Governor revives water bill tax

With little attention and no fanfare, Gov. Jerry Brown plans to resurrect the idea of a state tax on local water bills. Last summer, the state Assembly held a hearing on Senate Bill 623, which would impose a monthly fee on the size of a customer’s water meter.

Individuals served with a one-inch meter would pay 95 cents per month. If the meter were between 1 and 2 inches, the state tax would be $4 monthly. The highest rate would have been $10 per month for meters greater than 4 inches.

Low-income customers would have been exempt. The bill also proposed a tax on fertilizer and milk. The estimated revenues, greater than $100 million annually, would be used to repair or construct safe drinking water projects in disadvantaged communities, which did not have the capability to raise the construction funding themselves.

Then, no further action was taken, except for several editorials throughout the state panning the idea.

However, Brown has revived the proposal and included it in his fiscal year 2018-19 budget.

“The Administration is proposing statutory language, consistent with the policy frame work of SB 623, introduced in the 2017-18 legislative session. The Governor wants to establish a program that … provides grants, loans, and administrator contracts or services to assist eligible communities and households in securing access to safe and affordable drinking water,” according to his budget document.

In 2018-19, the governor is proposing an initial budget of $4.7 million. This will be used to establish the program and begin its implementation, including an assessment of how much funding will be needed.

The most commonly found contaminants are arsenic, perchlorate and nitrates from human actions or nature. The first is often natural mineral deposits in the water way. Military and industrial areas are the usual source of perchlorates. And nitrates frequently are come from fertilizers, which is why that product is being taxed, too.

The State Water Resources Control Board already has identified more than 300 water systems that are contaminated. Nearly half a million residents may be served from these systems, according to the SWRCB. The state has a law declaring that safe, clean, affordable and accessible water is a basic human right.

The Legislative Analyst noted that the total revenue likely to be collected has not been determined. Further, many of the unsafe water systems have nitrates. Consequently, the cleaning of these systems may be subsidized by clean-water systems rather than the polluter. Finally, the state does not yet have an estimate of the funding needed to repair or restore safe water to these communities.

Local water district general managers were skeptical of the potential success of the program and concerned about how it might affect their districts. A state tax on water bills is significant competition for additional operating revenue.

“It’s a tough question,” said Victor Jimenez, Fern Valley’s general manager. “I don’t think [the money] will go where it is supposed to go. And where is the federal money for safe water?”

“If it is the same [as SB 623], it was not well thought out how this would work,” expressed Idyllwild’s General Manager Jack Hoagland.