Existing law provides for state cooperation with the federal government in the construction of specified flood control projects, and prescribes requirements to be met prior to state authorization of flood management projects that receive state financial aid.

This bill would authorize the state to provide subvention funds, as prescribed, to the Santa Clara Valley Water District for the South San Francisco Bay Shoreline Project for flood control in areas along the south San Francisco Bay in the County of Santa Clara, as described, at an estimated cost to the state of the sum that may be appropriated for state cooperation by the Legislature upon the recommendation and advice of the Department of Water Resources and upon a determination by the department that the project meets specified financial aid requirements. The bill would provide that the state assumes no liability for damages that may result from the project by authorizing the provision of subvention funds, or by the appropriation of those subvention funds, as specified.

Existing law provides for state cooperation with the federal government in the construction of specified flood control projects, and prescribes requirements to be met prior to state authorization of flood management projects that receive state financial aid.

This bill would authorize the state to provide subvention funds, as prescribed, to the Santa Clara Valley Water District for the South San Francisco Bay Shoreline Project for flood control in areas along the south San Francisco Bay in the County of Santa Clara, as described, at an estimated cost to the state of the sum that may be appropriated for state cooperation by the Legislature upon the recommendation and advice of the Department of Water Resources and upon a determination by the department that the project meets specified financial aid requirements. The bill would provide that the state assumes no liability for damages that may result from the project by authorizing the provision of subvention funds, or by the appropriation of those subvention funds, as specified.

Existing law provides for state cooperation with the federal government in the construction of specified flood control projects, and prescribes requirements to be met prior to state authorization of flood management projects that receive state financial aid.

This bill would authorize the state to provide subvention funds, as prescribed, to the Santa Clara Valley Water District for the South San Francisco Bay Shoreline Project for flood control in areas along the south San Francisco Bay in the County of Santa Clara, as described, at an estimated cost to the state of the sum that may be appropriated for state cooperation by the Legislature upon the recommendation and advice of the Department of Water Resources and upon a determination by the department that the project meets specified financial aid requirements. The bill would provide that the state assumes no liability for damages that may result from the project by authorizing the provision of subvention funds, or by the appropriation of those subvention funds, as specified.

Existing law provides for state cooperation with the federal government in the construction of specified flood control projects, and prescribes requirements to be met prior to state authorization of flood management projects that receive state financial aid.

This bill would authorize the state to provide subvention funds, as prescribed, to the Santa Clara Valley Water District for the South San Francisco Bay Shoreline Project for flood control in areas along the south San Francisco Bay in the County of Santa Clara, as described, at an estimated cost to the state of the sum that may be appropriated for state cooperation by the Legislature upon the recommendation and advice of the Department of Water Resources and upon a determination by the department that the project meets specified financial aid requirements. The bill would provide that the state assumes no liability for damages that may result from the project by authorizing the provision of subvention funds, or by the appropriation of those subvention funds, as specified.

Existing law provides for state cooperation with the federal government in the construction of specified flood control projects, and prescribes requirements to be met prior to state authorization of flood management projects that receive state financial aid.

This bill would authorize the state to provide subvention funds, as prescribed, to the Santa Clara Valley Water District for the South San Francisco Bay Shoreline Project for flood control in areas along the south San Francisco Bay in the County of Santa Clara, as described, at an estimated cost to the state of the sum that may be appropriated for state cooperation by the Legislature upon the recommendation and advice of the Department of Water Resources and upon a determination by the department that the project meets specified financial aid requirements. The bill would provide that the state assumes no liability for damages that may result from the project by authorizing the provision of subvention funds, or by the appropriation of those subvention funds, as specified.

Existing law provides for state cooperation with the federal government in the construction of specified flood control projects, and prescribes requirements to be met prior to state authorization of flood management projects that receive state financial aid.

This bill would authorize the state to provide subvention funds, as prescribed, to the Santa Clara Valley Water District for the South San Francisco Bay Shoreline Project for flood control in areas along the south San Francisco Bay in the County of Santa Clara, as described, at an estimated cost to the state of the sum that may be appropriated for state cooperation by the Legislature upon the recommendation and advice of the Department of Water Resources and upon a determination by the department that the project meets specified financial aid requirements. The bill would provide that the state assumes no liability for damages that may result from the project by authorizing the provision of subvention funds, or by the appropriation of those subvention funds, as specified.

 UNFINISHED BUSINESS  

Bill No: SB 881

Author:

:

Vote:

SENATE NATURAL RES. & WATER COMMITTEE: 8-0, 3/13/18

AYES: Hertzberg, Stone, Allen, Jackson, McGuire, Monning, Stern, Vidak

NO VOTE RECORDED: Hueso

SENATE JUDICIARY COMMITTEE: 7-0, 4/17/18

AYES: Jackson, Moorlach, Anderson, Hertzberg, Monning, Stern, Wieckowski

SENATE APPROPRIATIONS COMMITTEE: 7-0, 5/25/18

AYES: Lara, Bates, Beall, Bradford, Hill, Nielsen, Wiener

SENATE FLOOR: 39-0, 5/31/18

AYES: Allen, Anderson, Atkins, Bates, Beall, Berryhill, Bradford, Cannella, De León, Dodd, Fuller, Gaines, Galgiani, Glazer, Hernandez, Hertzberg, Hill, Hueso, Jackson, Lara, Leyva, McGuire, Mitchell, Monning, Moorlach, Morrell, Newman, Nguyen, Nielsen, Pan, Portantino, Roth, Skinner, Stern, Stone, Vidak, Wieckowski, Wiener, Wilk

ASSEMBLY FLOOR: 78-0, 8/28/18 - See last page for vote

SUBJECT:

SOURCE: Santa Clara Valley Water District

DIGEST:

This bill authorizes the state to provide subvention funds to the Santa Clara Valley Water District for the South San Francisco Bay Shoreline Project (project) if specified conditions are met. This bill also specifies that the state assumes no liability for damages that may result from the project, except as specified.

Assembly Amendments

provide that the limitation on the state’s liability does not apply to damages resulting from activities the State Coastal Conservancy undertakes or manages for the project.

ANALYSIS:

Existing law:

1. Provides, pursuant to the State Water Resources Law of 1945, that the state may participate in funding local flood control projects that are authorized by the legislature and that meet all of the following criteria:
   1. The project qualifies for federal financial assistance and is authorized by Congress. Projects may be authorized pursuant to a Chief Engineer’s report, but cannot receive state funding until authorized by Congress.
   2. The total annual benefit exceeds the annual cost of providing protection from flood damages.
   3. The project provides protection from flood damages in the most efficient manner practicable, and with due regard for environmental and recreational considerations, and local economic conditions.
   4. The project's nonfederal sponsor is in compliance with federal laws requiring the preparation, adoption, and implementation of a floodplain management plan.
   5. All local communities benefiting from the project have an ordinance consistent with the National Flood Insurance Program's model floodplain management ordinance.
   6. The project avoids, minimizes, or mitigates impacts to environmental and recreational values.
   7. Project planning documents include an evaluation of opportunities to include multipurpose objectives.
   8. The nonfederal sponsor accommodates other partners who wish to provide the costs of including multipurpose objectives that are compatible with the project’s purpose and schedule.
2. Provides that before receiving payment or reimbursement from the state, the local agency must enter into an agreement with the Department of Water Resources (DWR) under which the local agency agrees to indemnify, hold, and save the state, and its officers, agents, and employees, harmless from any and all liabilities from damages associated with the maintenance and operation of the project.

This bill:

Authorizes the state to provide subvention funds to the Santa Clara Valley Water District for the for flood control in areas of the Project if the project is constructed in accordance with the federal Water Infrastructure Improvements for the Nation Act (Public Law 114-322) and substantially in accordance with the recommendations of the Engineers Report developed by the United States Army Corps of Engineers Chief of Engineers.

Provides that, except for liability for damages resulting from activities the State Coastal Conservancy undertakes or manages for the project, the state assumes no liability for damages that may result from the project by either of the following:

Authorizing the provision of subvention funds in accordance with this section.

The appropriation by the Legislature of these subvention funds upon the recommendations and advice of DWR.

Conditions the subvention funding on the county or local agency entering into an agreement with DWR whereby the county or local agency agrees to indemnify and hold and save harmless the state, its officers, agents, and employees for any and all liability for damages that may result from the project, except as provided in 2) (above).

FISCAL EFFECT: Appropriation: Fiscal Com.: Local:

According to the Assembly Appropriations Committee:

1. DWR estimates the state share of the nonfederal project costs to be between $40 million and $60 million (bond or General Fund) with project completion projected to take up to 13 years.
   
   The subvention program currently has approximately $120 million of Proposition 1E bond funds appropriated (expires in June 2023) and over $40 million of Proposition 84 bond funds appropriated. Existing bond funds are expected to be consumed by calendar year 2022 without any additional funding.
2. No additional State Coastal Conservancy costs.

SUPPORT: (Verified 8/28/18)

Santa Clara Valley Water District (source)

Bay Area Council

California Municipal Utilities Association

California Special Districts Association

City of Palo Alto

City of San Jose

Cupertino Chamber of Commerce

Midpeninsula Regional Open Space District

Milpitas Chamber of Commerce

National Association for the Advancement of Colored People

Santa Clara Chamber of Commerce

Santa Clara Valley Open Space Authority

Silicon Valley Leadership Group

Silicon Valley Organization

OPPOSITION: (Verified 8/28/18)

None received

ARGUMENTS IN SUPPORT: According to the author, “SB 881 would add the South San Francisco Bay Shoreline Project (Shoreline Project) of the Santa Clara Valley Water District (District) to the list of flood control projects authorized to receive state flood control subventions reimbursements in accordance with the process established in existing law.

“California is challenged by the increased intensity of storms and rising sea levels brought on by global warming and climate change. While no single storm can be directly attributed to climate change, the increased volatility in local climates is taking a toll. Sea level rise, already felt in Bay Area coastal communities, requires a multi-faceted response involving significant public works projects that couple levees with natural barriers such as restoring marshes to increase the resiliency of the shoreline to storm actions and sea level rise.

“The Shoreline Project incorporates a multi-benefit approach to flood protection by combining environmental restoration of wetlands and traditional levee construction to protect properties in the South San Francisco Bay Area. The project would provide flood protection to portions of Palo Alto, Mountain View, Sunnyvale, San Jose, and the community of Alviso from the risk of high tides and rising seas.”

ASSEMBLY FLOOR: 78-0, 8/28/18

AYES: Acosta, Aguiar-Curry, Travis Allen, Arambula, Baker, Berman, Bigelow, Bloom, Bonta, Brough, Burke, Caballero, Calderon, Carrillo, Cervantes, Chau, Chávez, Chen, Chiu, Choi, Chu, Cooley, Cooper, Cunningham, Daly, Eggman, Flora, Fong, Friedman, Gabriel, Gallagher, Cristina Garcia, Eduardo Garcia, Gipson, Gloria, Gonzalez Fletcher, Gray, Grayson, Harper, Holden, Irwin, Jones-Sawyer, Kalra, Kamlager-Dove, Kiley, Lackey, Levine, Limón, Low, Maienschein, Mathis, Mayes, McCarty, Medina, Melendez, Mullin, Muratsuchi, Nazarian, Obernolte, O'Donnell, Patterson, Quirk, Quirk-Silva, Reyes, Rivas, Rodriguez, Rubio, Salas, Santiago, Steinorth, Mark Stone, Thurmond, Ting, Voepel, Waldron, Weber, Wood, Rendon

NO VOTE RECORDED: Dahle, Frazier

Prepared by:

8/28/18 21:31:12

**** END ****

SENATE THIRD READING

STR Bill Id:SB 881

Author:(Wieckowski)

As Amended Ver:August 23, 2018

Majority vote

SENATE VOTE: 39-0

SUMMARY: This bill authorizes the state to provide flood control subvention funds to the Santa Clara Valley Water District (SCVWD) for the South San Francisco Bay Shoreline Project (project) if specified conditions are met. This bill also specifies the state assumes no liability for damages that may result from the project, except as specified. Specifically, this bill:

Authorizes the state to provide subvention funds for flood control in areas of the project, as specified.

Requires the SCVWD to enter into an agreement with the Department of Water Resources (DWR) to indemnify and hold and save harmless the state, as specified, for any and all liability for damages, as defined, that may result from the flood protection components of the project.

Provides the state assumes no liability for damages that may result from the project, except for liability from damages resulting from activities the State Coastal Conservancy undertakes or manages for the project.

EXISTING LAW:

1. Provides, pursuant to the State Water Resources Law of 1945, that the state may participate in funding local flood control projects that are authorized by the Legislature and that meet specified criteria.
2. Provides that before receiving payment or reimbursement from the state, the local agency must enter into an agreement with the DWR under which the local agency agrees to indemnify, hold, and save the state, and its officers, agents, and employees, harmless from any and all liabilities from damages associated with the maintenance and operation of the project.

FISCAL EFFECT: According to the Assembly Appropriations Committee:

1. DWR estimates the state share of the nonfederal project costs to be between $40 million and $60 million (bond or General Fund) with project completion projected to take up to 13 years.
2. The subvention program currently has approximately $120 million of Proposition 1E bond funds appropriated (expires in June 2023) and over $40 million of Proposition 84 bond funds appropriated. Existing bond funds are expected to be consumed by calendar year 2022 without any additional funding.
3. No additional State Coastal Conservancy costs.

COMMENTS: The DWR administers the Flood Control Subventions program. First, projects are federally authorized and then local agencies seek legislative authorization from the state, which includes cost sharing. If the project is approved by the Legislature, the state contributes to the non-federal costs of the project pursuant to a formula established in existing law.

The project adopts a multi-benefit approach to improving flood protection. The total design and construction cost for the flood risk management structures, ecosystem restoration, and recreational improvements for the project is estimated to be $177 million. The total non-federal share of this project cost will be $105.5 million with $43 million for the levee and related structures, $59 million for the ecosystem restoration, and $3.5 million for the recreational improvements. The SCVWD will provide $45 million to cover the flood aspects of the project, with an estimated $4 to $7 million expected to be eligible for the state flood subventions reimbursements.

Indemnification from liability has become a standard provision in legislation that adds projects to those eligible to receive subvention funds. That has become necessary due to a California Supreme Court ruling (Paterno v. State, 2003) that held the state liable for the failure of a levee generally operated and maintained by a local levee maintenance district. Additionally, AB 1147 (Honda), Chapter 1071, Statutes of 2000, among other things, required a local agency, prior to receiving subvention funds, to enter into an agreement with DWR on liability.

The bill contains provisions requiring the SCVWD to indemnify and hold harmless the state, its officers, agents, and employees for any and all liability for damages that may result from the project. Unlike many prior projects, the state is playing an active role in the project, as the State Coastal Conservancy is taking part in the project. Accordingly, this bill limits the state's liability shield with regards to any damages incurred as a result of the Coastal Conservancy's actions in undertaking or managing the project. According to the State Coastal Conservancy, this bill does not affect the preexisting relationship between the conservancy and SCVWD, but rather maintains the status quo.

Recent amendments add coauthors and make technical, non-substantive changes.

Analysis Prepared by: Ryan Ojakian / W., P., & W. / (916) 319-2096 FN: 0004351

SENATE THIRD READING

STR Bill Id:SB 881

Author:(Wieckowski)

As Amended Ver:June 19, 2018

Majority vote

SENATE VOTE: 39-0

SUMMARY: This bill authorizes the state to provide flood control subvention funds to the Santa Clara Valley Water District (SCVWD) for the South San Francisco Bay Shoreline Project (project) if specified conditions are met. This bill also specifies the state assumes no liability for damages that may result from the project, except as specified. Specifically, this bill:

Authorizes the state to provide subvention funds for flood control in areas of the project, as specified.

Requires the SCVWD to enter into an agreement with the Department of Water Resources (DWR) to indemnify and hold and save harmless the state, as specified, for any and all liability for damages, as defined, that may result from the flood protection components of the project.

Provides the state assumes no liability for damages that may result from the project, except for liability from damages resulting from activities the State Coastal Conservancy undertakes or manages for the project.

EXISTING LAW:

1. Provides, pursuant to the State Water Resources Law of 1945, that the state may participate in funding local flood control projects that are authorized by the Legislature and that meet specified criteria.
2. Provides that before receiving payment or reimbursement from the state, the local agency must enter into an agreement with the DWR under which the local agency agrees to indemnify, hold, and save the state, and its officers, agents, and employees, harmless from any and all liabilities from damages associated with the maintenance and operation of the project.

FISCAL EFFECT: According to the Assembly Appropriations Committee:

1. DWR estimates the state share of the nonfederal project costs to be between $40 million and $60 million (bond or General Fund) with project completion projected to take up to 13 years.
2. The subvention program currently has approximately $120 million of Proposition 1E bond funds appropriated (expires in June 2023) and over $40 million of Proposition 84 bond funds appropriated. Existing bond funds are expected to be consumed by calendar year 2022 without any additional funding.
3. No additional State Coastal Conservancy costs.

COMMENTS: The DWR administers the Flood Control Subventions program. First, projects are federally authorized and then local agencies seek legislative authorization from the state, which includes cost sharing. If the project is approved by the Legislature, the state contributes to the non-federal costs of the project pursuant to a formula established in existing law.

The project adopts a multi-benefit approach to improving flood protection. The total design and construction cost for the flood risk management structures, ecosystem restoration, and recreational improvements for the project is estimated to be $177 million. The total non-federal share of this project cost will be $105.5 million with $43 million for the levee and related structures, $59 million for the ecosystem restoration, and $3.5 million for the recreational improvements. The SCVWD will provide $45 million to cover the flood aspects of the project, with an estimated $4 to $7 million expected to be eligible for the state flood subventions reimbursements.

Indemnification from liability has become a standard provision in legislation that adds projects to those eligible to receive subvention funds. That has become necessary due to a California Supreme Court ruling (Paterno v. State, 2003) that held the state liable for the failure of a levee generally operated and maintained by a local levee maintenance district. Additionally, AB 1147 (Honda), Chapter 1071, Statutes of 2000, among other things, required a local agency, prior to receiving subvention funds, to enter into an agreement with DWR on liability.

The bill contains provisions requiring the SCVWD to indemnify and hold harmless the state, its officers, agents, and employees for any and all liability for damages that may result from the project. Unlike many prior projects, the state is playing an active role in the project, as the State Coastal Conservancy is taking part in the project. Accordingly, this bill limits the state’s liability shield with regards to any damages incurred as a result of the Coastal Conservancy’s actions in undertaking or managing the project. According to the State Coastal Conservancy, this bill does not affect the preexisting relationship between the conservancy and SCVWD, but rather maintains the status quo.

Analysis Prepared by: Ryan Ojakian / W., P., & W. / (916) 319-2096 FN: 0004122

Date of Hearing: August 8, 2018

ASSEMBLY COMMITTEE ON APPROPRIATIONS

Lorena Gonzalez Fletcher, Chair

SBPCA Bill Id:SB 881

Author:(Wieckowski) – As Amended Ver:June 19, 2018

Urgency: No State Mandated Local Program: No Reimbursable: No

SUMMARY:

This bill authorizes the state to provide flood control subvention funds to the Santa Clara Valley Water District (SCVWD) for the South San Francisco Bay Shoreline Project (project) if specified conditions are met. This bill also specifies the state assumes no liability for damages that may result from the project, except as specified. Specifically, this bill:

Authorizes the state to provide subvention funds for flood control in areas of the project, as specified.

Requires the SCVWD to enter into an agreement with the Department of Water Resources (DWR) to indemnify and hold and save harmless the state, as specified, for any and all liability for damages, as defined, that may result from the flood protection components of the project.

Provides the state assumes no liability for damages that may result from the project, except for liability from damages resulting from activities the State Coastal Conservancy undertakes or manages for the project.

FISCAL EFFECT:

1. DWR estimates the state share of the nonfederal project costs to be between $40 million and $60 million (bond or GF) with project completion projected to take up to 13 years.

The subvention program currently has approximately $120 million of Proposition 1E appropriated (expires in June 2023) and over $40 million of Proposition 84 appropriated.  Existing bond funds are expected to be consumed by calendar year 2022 without any additional funding.

1. No additional State Coastal Conservancy costs.

COMMENTS:

1. Purpose. According to the author, “This bill adds the South San Francisco Bay Shoreline Project to the list of flood control projects authorized to receive state flood control subvention reimbursements in accordance with the process established in existing law.”
2. Background. DWR administers the Flood Control Subventions program. First, projects are federally authorized and then local agencies seek legislative authorization from the state, which includes cost sharing. If the project is approved by the Legislature, the state contributes to the non-federal costs of the project pursuant to a formula established in existing law.

Typically, the federal government provides funding for 50% to 75% of a project’s cost and the local agency, as the entity participating in the project construction under agreement with the federal agency, is responsible for providing the nonfederal share of project costs to the federal agency. If the local agency complies with the Water Code and program guidelines, the state will reimburse the local entity for 50% to 70% of the nonfederal share (not to exceed specified limits). The reimbursement rate is based on how effectively the project achieves multi-purpose objectives.

Indemnification from liability has become a standard provision in legislation that adds projects to those eligible to receive subvention funds. That has become necessary due to a California Supreme Court ruling (Paterno v. State, 2003) that held the state liable for the failure of a levee generally operated and maintained by a local levee maintenance district.

Additionally, AB 1147 (Honda), Chapter 1071, Statutes of 2000, among other things, requires a local agency, prior to receiving subvention funds, to enter into an agreement with DWR on liability.

According to the State Coastal Conservancy, this bill does not affect the preexisting relationship between the conservancy and SCVWD, but rather maintains the status quo.

1. The South San Francisco Bay Shoreline Project. When completed, the project is anticipated to provide flood protection to the communities of Palo Alto, Sunnyvale, San Jose, and Santa Clara.

In addition to the traditional construction and reinforcement of levees, this project will provide for wetland restoration and other environmentally beneficial enhancements to better use nature as a defense against large storms and other flood risks. The project proposes to restore 15,100 acres of historic wetlands and return 2,900 acres of former salt production ponds to tidal marsh habitat.

Analysis Prepared by: Jennifer Galehouse / APPR. / (916) 319-2081

Date of Hearing: June 28, 2018

ASSEMBLY COMMITTEE ON JUDICIARY

Mark Stone, Chair

SBPCA Bill Id:SB 881

Author:(Wieckowski) – As Amended Ver:June 19, 2018

PROPOSED CONSENT

SENATE VOTE: 39-0

SUBJECT: Flood control: County of Santa Clara: South San Francisco Bay Shoreline Project

KEY ISSUE: SHOULD THE South San Francisco BAY SHORELINE PROJECT BE AUTHORIZED TO RECEIVE STATE FLOOD CONTROL SUBVENTION FUNDS, SO LONG AS THE SANTA CLARA WATER DISTRICT AGREES TO INDEMNIFY THE STATE FOR MOST LIABILITY?

SYNOPSIS

This non-controversial measure would add the South San Francisco Bay Shoreline Project, a $177 million dollar habitat restoration and levee construction project, to the list of flood control projects authorized to receive state flood control subvention payments. This bill is essential to obtaining state funds that will assist in matching federal flood prevention funding to support the project. This project will utilize $45 million from the Santa Clara Valley Water District, and approximately $4 to $7 million of state dollars in addition to federal and other funds. To protect the state, this bill requires the Santa Clara Valley Water District to indemnify the state for all liability associated with the project, except for any liability incurred by the State Coastal Conservancy, which is serving as a participant on the project.

This bill is modeled on provisions to authorize subvention payments for other local flood protection projects across California in recent years. This bill is sponsored by the Santa Clara Valley Water District and is strongly supported by a coalition of local governments and civic organizations in the South Bay and Silicon Valley. These groups promote the strong safety and ecological benefits that, upon completion, this project will provide to the region. This bill has no known opposition, was approved by the California Senate 39-0, and recently passed the Assembly Committee on Water, Parks, and Wildlife by a vote of 15-0.

SUMMARY: Adds the South San Francisco Bay Shoreline Project by the Santa Clara Valley Water District to the list of flood control projects authorized to receive state flood control subvention reimbursements, clarifies that the state assumes no liability for damages that may result from the project through the authorization and appropriation of subvention funds, and requires the District to indemnify the state for all aspects of the project except those activities undertaken by the State Coastal Conservancy in relation to the project. Specifically, this bill:

1. Provides that the state may provide subvention funds in accordance with existing law to the Santa Clara Valley Water District for the South San Francisco Bay Shoreline Project for flood control in areas along the south San Francisco Bay in the County of Santa Clara that is authorized by Section 1401 of the federal Water Infrastructure Improvements for the Nation Act (Public Law 114-322) and that is substantially in accordance with the recommendations of the Chief of Engineers of the United States Army Corps of Engineers Report, dated December 18, 2015, as follows:
   1. The funds provided are at an estimated cost to the state of the sum that may be appropriated for state cooperation by the Legislature upon the recommendations and advice of the Department of Water Resources, and
   2. Upon a written determination by the Department of Water Resources that the project meets the requirements of existing law.
2. Provides that the state assumes no liability for damages that may result from the project by either of the following:
   1. Authorizing the provision of subvention funds in accordance with this section, or
   2. The appropriation by the Legislature of these subvention funds upon the recommendations and advice of the department.
3. Provides that the Santa Clara Valley Water District may receive the subvention funds only if it enters into an agreement with the Department of Water Resources pursuant to which the district agrees to indemnify and hold and save harmless the state, its officers, agents, and employees for any and all liability for damages that may result from the project, except for liability for damages resulting from activities that the State Coastal Conservancy undertakes or manages, in whole or in part, for the project.
4. For the purpose of the bill, defines “liability for damages” to include, but not be limited to, liability for damages relating to the construction or operation of the project or the failure of the project to operate as intended.

EXISTING LAW:

1. Pursuant to the State Water Resources Law of 1945, provides for the study and funding of flood control projects throughout the state. (Water Code Section 12570 et seq.)
2. Declares that recurrent floods on streams, rivers, and other waterways of the state, causing loss of life and property, disruption of commerce, interruption of transportation and communications, and wasting of water, are detrimental to the peace, health, safety, and welfare of the people of the state; the control, storage and full beneficial use of flood waters, and the prevention of damage by flood waters, and the washing away of river and stream banks by floods are proper functions and activities of the state, in cooperation with counties, cities, state agencies, and public districts, and in cooperation with the United States, or any of its departments or agencies. (Water Code Section 12579.)
3. Declares that the state should engage in the study and coordination of all water development projects, including flood control projects, undertaken by counties, cities, state agencies, public districts, and the United States or any of its departments or agencies, so that such allocations and appropriations made by the California Legislature for such purposes will be expended upon those projects in a manner that is most beneficial to the state, and which will bring maximum benefits to the people of the state from the expenditure of public funds, and also that the state should participate in the construction of flood control works and projects and render beneficial aid thereto, when the benefits are in excess of the estimated cost. (Water Code Section 12580.)
4. Provides, pursuant to the State Water Resources Law of 1945, that the state may provide financial assistance to local flood control projects, so long as all of the following conditions are satisfied:
5. The project qualifies for federal financial assistance under the requirements applicable to federal water resource development projects and is federally authorized.
6. The total annual benefit of providing protection from flood damage exceeds the annual cost of the project allocable to flood management; and the project is designed to produce the greatest feasible reduction in flood damages in the most efficient manner practicable, with due regard for environmental and recreational considerations, and local economic conditions.
7. The project’s nonfederal sponsor, or other appropriate local agency, complies with provisions of the federal law that require the preparation, adoption, and implementation of a floodplain management plan designed to reduce the impacts of future floods; all local communities benefiting from the project shall have an ordinance consistent with the National Flood Insurance Program’s model floodplain management ordinance.
8. The project avoids, minimizes, or mitigates impacts to environmental and recreational values.
9. The project planning documents include an evaluation of opportunities to include multipurpose objectives and the nonfederal sponsor accommodates other partners that provide the costs of including multipurpose objectives that the nonfederal sponsor determines are compatible with the project’s schedule and primary flood management purpose. (Water Code Section 12582.7 (a).)
10. Requires the Reclamation Board or the Department of Water Resources, in its advisory role, to provide sufficient review and oversight in the initial scoping process, feasibility evaluation, environmental review, and project approval processes for flood management projects to determine whether the requirements set forth in 4), above, are satisfied; requires the Department or the Reclamation Board to inform the nonfederal sponsor and any local sponsor whether the project meets those requirements during the feasibility evaluation and environmental review process; and requires, prior to state authorization, the Department or the Reclamation Board to submit a report to the Legislature that indicates whether the project meets the requirements. (Water Code Section 12582.7 (b).)
11. Provides authorizations for flood control projects approved in the Sacramento-San Joaquin Watersheds pursuant to 4). (Water Code Section 12645 et seq.)
12. Authorizes small flood control projects approved pursuant to 4), above. (Water Code Section 12750 et seq.)
13. Provides authorization for flood control projects approved outside of the Sacramento-San Joaquin Watersheds pursuant to 4), above. (Water Code Section 12671 et seq.)
14. Requires, pursuant to federal law, that construction of any project for local flood protection, or any project for hurricane or storm damage reduction, that involves Federal assistance from the Secretary of the Army, the non-Federal interest to agree to participate in and comply with applicable Federal floodplain management and flood insurance programs. (30 U.S.C. 15, Section 701b-12 (a).)

FISCAL EFFECT: As currently in print this bill is keyed fiscal.

COMMENTS: This bill serves to provide the legislative authority necessary to authorize state flood control subvention payments to the South San Francisco Bay Shoreline Project. Similar to prior project authorizations for subvention payments in recent years, the bill provides indemnity to the state for all liability for damages that may result from the project to the extent that a state entity did not undertake or manage that aspect of a project.

Existing law requires legislative approval for the issuance of subvention funds to flood control projects, among other requirements. Since the 1940s, existing law has permitted the state to study and fund flood control projects throughout California. The funding provided under existing law is administered by the Department of Water Resources through the Flood Control Subventions Program. That program reimburses local agencies for the state cost-share of federally authorized projects conducted in cooperation with the United States Army Corps of Engineers. As the author notes, these funds may reimburse local agencies for the relocation of channels and levee projects, and for the cost to secure rights-of-way. State law requires that the local agency supporting a project secure a determination from the Department of Water Resources indicating that the project qualifies for the program. The Department of Water Resources then must submit a report to the Legislature finding that the project qualifies for funding under state and federal law. Lastly, the California Legislature must enact legislation approving the project in order to officially authorize the payment of subvention funds to cover the state’s share of the project’s costs.

This bill. In accordance with state and federal law, this bill would provide formal legislative authorization for the South San Francisco Bay Shoreline Project, thereby authorizing state subvention funding, in addition to local funds and the federal funding approved by the Water Infrastructure Improvements for the Nation Act. (Public Law 114-322, Section 1401, December 16, 2016.) The bill would make all of the findings necessary to carry out the approval. Finally, as has been standard for projects approved in recent years, this bill requires the Santa Clara Valley Water District to indemnify the state for any liability incurred unless the liability arises as the result of damages incurred by the activities of the State Coastal Conservancy in managing the project.

Author’s Statement. In support of this measure, the author highlights the need for the project and its potential benefits. The author states:

California is challenged by the increased intensity of storms and rising sea levels brought on by global warming and climate change. While no single storm can be directly attributed to climate change, the increased volatility in local climates is taking a toll. Sea level rise, already felt in Bay Area coastal communities, requires a multi-faceted response involving significant public works projects that couple levees with natural barriers such as restoring marshes to increase the resiliency of the shoreline to storm actions and sea level rise.

The Shoreline Project incorporates a multi-benefit approach to flood protection by combining environmental restoration of wetlands and traditional levee construction to protect properties in the South San Francisco Bay Area. The project would provide flood protection to portions of Palo Alto, Mountain View, Sunnyvale, San Jose, and the community of Alviso from the risk of high tides and rising seas.

The project will help protect globally-recognized businesses that power the region’s and the nation’s economy, including Cisco and Google, as well as three wastewater facilities that are critical to the communities of Palo Alto, Sunnyvale, San Jose, and Santa Clara. The area at risk also includes the NASA/Ames Research Center.

SB 881 would authorize state flood control subventions funding, subject to the requirements established in current law, for reimbursement of a small portion of costs for a vitally important project that will help protect an area of national economic importance.

The South San Francisco Bay Shoreline Project adopts a multi-benefit approach to improving flood protection in Silicon Valley. The South San Francisco Bay Shoreline Project seeks to utilize multiple strategies for flood protection. In addition to the traditional construction and reinforcement of levees, this project will provide for wetland restoration and other environmentally beneficial enhancements to better use nature as a defense against large storms and other flood risks. The South San Francisco Bay Shoreline Project is proposed to restore 15,100 acres of historic wetlands, and return 2,900 acres of former salt production ponds to tidal marsh habitat.

When completed, the South San Francisco Shoreline Project is anticipated to provide flood protection to the communities of Palo Alto, Sunnyvale, San Jose, and Santa Clara. According to the Bay Area Council, should a 100-year flood strike this region without the protections to be provided by the South San Francisco Bay Shoreline Project, an estimated $6.14 billion in damage would occur across 4,700 acres of land that would impact 5,000 structures.

Ensuring that state taxpayers are protected from liability. This bill contains two provisions regarding potential liability that are modeled after similar language included in prior subvention project approvals. The bill defines “liability for damages” to include liability for damages relating to the construction or operation of the project, or the failure of the project to operate as intended. The bill provides that the state is not liable for any damages stemming from the authorization or appropriation of the subvention funds. These provisions mirror provisions contained in subvention authorizations for the flood control projects on the Pajaro River in Santa Clara and Monterey Counties; the Napa River in Napa County; and Santa Barbara streams and the Lower Mission Creek, in Santa Barbara County.

This bill also contains provisions requiring the funding recipient, in this case the Santa Clara Valley Water District, to indemnify and hold harmless the state, its officers, agents, and employees for any and all liability for damages that may result from the project. This is similar to language in other prior projects including the aforementioned Pajaro River in Santa Clara and Monterey Counties. However, unlike many prior projects, the state is playing an active role in the project, as the State Coastal Conservancy is taking part in the South San Francisco Shoreline Project. Accordingly, as recently amended, this bill limits the state’s liability shield with regards to any damages incurred as a result of the Coastal Conservancy’s actions in undertaking or managing the project.

ARGUMENTS IN SUPPORT: This bill is supported by a coalition of local governments and civic associations from across the southern portion of the Bay Area. Echoing the sentiment of much of the group, the bill’s sponsor, the Santa Clara Valley Water District, states:

Global warming and climate change are causing changes in seas level and in the way California experiences winter storms. Reports indicate that sea level rise could range from 2.5 to a catastrophic 10 feet over the next century. It is projected that a one-percent tidal flood event in Silicon Valley could cause $6.14 billion in damage to homes, businesses, roads, highways, parks, an airport, wastewater treatment plants, utility infrastructure, and the new Silicon Valley Advanced Water Purification Center.

The Shoreline Project addresses these threats by restoring 15,100 acres of former salt ponds to historical tidal marsh, and by building a levee alone the South Bay. The Shoreline project increases flood protection for infrastructure vital to the regional, state, and national economies, all while creating new habitat for sensitive species.

REGISTERED SUPPORT / OPPOSITION:

Support

Santa Clara Valley Water District (sponsor)

AFSCME Local 101

Association of California Water Agencies

Bay Area Council

California Municipal Utilities Association

California Special Districts Association

City of Palo Alto

City of San Jose

City of San Jose, Councilmember Lan Diep

Cupertino Chamber of Commerce

Midpeninsula Regional Open Space District

Milpitas Chamber of Commerce

National Association for the Advancement of Colored People, San Jose/Silicon Valley Branch

Santa Clara Chamber of Commerce

Santa Clara Valley Open Space Authority

Silicon Valley Leadership Group

Silicon Valley Organization

Opposition

None on file

Analysis Prepared by: Nicholas Liedtke / JUD. / (916) 319-2334

Date of Hearing: June 26, 2018

ASSEMBLY COMMITTEE ON WATER, PARKS, AND WILDLIFE

Eduardo Garcia, Chair

SBPCA Bill Id:SB 881

Author:(Wieckowski) – As Amended Ver:June 19, 2018

SENATE VOTE: 39-0

SUBJECT: Flood control: County of Santa Clara: South San Francisco Bay Shoreline Project

SUMMARY: Authorizes the state to provide subvention funds to the Santa Clara Valley Water District (SCVWD) for the South San Francisco Bay Shoreline Project (project) if specified conditions are met. This bill also specifies that the state assumes no liability for damages that may result from the project. Specifically, this bill:

Authorizes the state to provide subvention funds for flood control in areas of the project, as specified.

Provides that the state assumes no liability for damages that may result from the project, except for liability from damages resulting from activities the State Coastal Conservancy undertakes or manages for the project.

Requires the SCVWD to enter into an agreement with the Department of Water Resources (DWR) in which the SCVWD agrees to indemnify and hold and save harmless the state, as specified, for any and all liability for damages, as defined, that may result from the flood protection components of the project.

EXISTING LAW:

1. Provides, pursuant to the State Water Resources Law of 1945, that the state may participate in funding local flood control projects that are authorized by the Legislature and that meet all of the following criteria:
   1. The project qualifies for federal financial assistance and is authorized by Congress. Projects may be authorized pursuant to a Chief Engineer’s report, but cannot receive state funding until authorized by Congress.
   2. The total annual benefit exceeds the annual cost of providing protection from flood damages.
   3. The project provides protection from flood damages in the most efficient manner practicable, and with due regard for environmental and recreational considerations, and local economic conditions.
   4. The project's nonfederal sponsor is in compliance with federal laws requiring the preparation, adoption, and implementation of a floodplain management plan.
   5. All local communities benefiting from the project have an ordinance consistent with the National Flood Insurance Program's model floodplain management ordinance.
   6. The project avoids, minimizes, or mitigates impacts to environmental and recreational values.
   7. Project planning documents include an evaluation of opportunities to include multipurpose objectives.
   8. The nonfederal sponsor accommodates other partners who wish to provide the costs of including multipurpose objectives that are compatible with the project’s purpose and schedule.
2. Provides that before receiving payment or reimbursement from the state, the local agency must enter into an agreement with the DWR under which the local agency agrees to indemnify, hold, and save the state, and its officers, agents, and employees, harmless from any and all liabilities from damages associated with the maintenance and operation of the project.

FISCAL EFFECT: Unknown.

COMMENTS:

Author’s Statement:

This bill would add the South San Francisco Bay Shoreline Project to the list of flood control projects authorized to receive state flood control subventions reimbursements in accordance with the process established in existing law.

The South San Francisco Bay Shoreline Project incorporates a multi-benefit approach to flood protection by combining environmental restoration of wetlands and traditional levee construction to protect properties in the South San Francisco Bay Area. The project would provide flood protection to portions of Palo Alto, Mountain View, Sunnyvale, San Jose, and the community of Alviso from the risk of high tides and rising seas. The project will help protect globally-recognized businesses that power the region’s and the nation’s economy, including Cisco and Google, as well as three wastewater facilities that are critical to the communities of Palo Alto, Sunnyvale, San Jose, and Santa Clara. The area at risk also includes the NASA/Ames Research Center.

The authorization in the bill would allow for reimbursement of a small portion of costs for a vitally important project that will help protect an area of national economic importance. Protecting Silicon Valley from tidal flood risk exacerbated by intensifying storms and sea level rise is sound public policy and a smart public investment.

Background: State Flood Control Subventions Fund. The DWR administers the Flood Control Subventions Program. The DWR’s website describes the program as follows: “When projects are federally authorized, local agencies are responsible for soliciting the state to consider cost sharing in the project. After we evaluate the project benefits, we may submit a report to the Legislature with an eligibility determination. If the project is approved by the California Legislature and specifically added to the California Water Code, we can share in the non-federal costs of the project.”

The South San Francisco Bay Shoreline Project. In 2006, the U.S. Army Corps of Engineers (Corps), the SCVWD, and the State Coastal Conservancy (Conservancy) jointly studied the existing flood threat and biological conditions of the Santa Clara County shoreline. In 2011, the agencies focused on a high-risk region in the Alviso neighborhood of San Jose to develop a project that would:

• Protect low-lying areas of Alviso and San Jose from flooding in a 100-year storm event;
• Protect the area from over 2 feet of sea level rise;
• Protect urban areas in North San Jose and Alviso from tidal flooding, including the city and county water pollution control plant;
• Restore up to 3.5 square miles of wetland habitat, with extensive habitat for endangered species, fish, and migratory birds; and
• Provide enhanced public trails and recreation opportunities.

The SCVWD certified a final Environmental Impact Statement/Environmental Impact Report (EIS/EIR) in March 2016, to be in compliance with the California Environmental Quality Act (CEQA).

According to the Senate Natural Resources and Water Committee analysis, the project authorized by this bill appears to meet all the requirements for state subvention funding.

The total design and construction cost for the flood risk management structures, ecosystem restoration, and recreational improvements is estimated to be $177 million. The total non-federal share of this project cost will be $105.5 million with $43 million for the levee and related structures, $59 million for the ecosystem restoration, and $3.5 million for the recreational improvements. The SCVWD will provide $45 million to cover the flood aspects of the project, with an estimated $4 to $7 million expected to be eligible for the state flood subventions reimbursements.

State Liability Associated with the Project. This bill would define “liability for damages” to include liability for damages relating to the construction or operation of the project or the failure of the project to operate as intended. The bill would provide that the state assumes no liability for damages resulting from the project by either of the following:

• Authorizing the provision of subvention funds in accordance with this section; or,
• The appropriation by the Legislature of these subvention funds upon the recommendations and advice of the DWR.

These specific provisions have been included in numerous flood control projects and insulate the state from liability for simply facilitating the funding of these projects.

In addition, this bill would provide that the SCVWD may receive the subvention funds only if it enters into an agreement with the DWR pursuant to which the SCVWD agrees to indemnify and hold and save harmless the state, its officers, agents, and employees for any and all liability for damages that may result from the planning, design, construction, operation, maintenance, repair, and rehabilitation of the flood protection components of the project. This language would therefore require the SCVWD to indemnify the state for the flood control elements that arguably should be borne by the SCVWD. The provision does not implicate the other components of the project, such as the ecosystem restoration, in which the Conservancy will be more actively involved.

Indemnification from liability has become a standard provision in legislation that adds projects to those eligible to receive subvention funds. That has become necessary due to a California Supreme Court ruling (Paterno v. State, 2003) that held the state liable for failure of a levee generally operated and maintained by a local levee maintenance district.

Double-Referral: This bill is double referred to the Judiciary Committee.

Prior and Related Legislation:

SB 619 (Strickland), Chapter 195, Statutes of 2009, added the Lower Mission Creek project, which is in the county of Santa Barbara, to the list of approved projects to receive state subventions funding. The bill was structured similarly to this bill.

AB 1147 (Honda), Chapter 1071, Statutes of 2000, among other things, required a local agency, prior to receiving subvention funds to enter into an agreement with the DWR on liability, as prescribed.

Supporting Arguments: Supporters state that this bill is a necessary step to authorize subvention funding to the SCVWD for the South San Francisco Bay Shoreline Project. This will facilitate a multi-benefit approach to flood protection, wetlands restoration and tidal flood rish reduction for multiple communities in the South Bay. It is projected that a one-percent tidal flood event in the Silicon Valley could cause $6.14 billion in damage to homes, businesses, roads, highways, parks, an airport, wastewater treatment plants, utility infrastructure and the new Silicon Valley Advanced Water Purification Center. The South San Francisco Bay Shoreline Project addresses these threats by restoring 15,100 acres of former salt ponds to historical tidal marsh, and by building a levee along the South Bay.

REGISTERED SUPPORT / OPPOSITION:

Support

Bay Area Council

California Municipal Utilities Association

California Special Districts Association

City of San Jose

City of San Jose, District 4

Cupertino Chamber of Commerce

Midpeninsula Regional Open Space District

Milpitas Chamber of Commerce

Palo Alto City Council

San Jose/Silicon Valley NAACP

Santa Clara Chamber of Commerce

Santa Clara Valley Open Space Authority

Santa Clara Valley Water District (Sponsor)

Silicon Valley Leadership Group

Silicon Valley Organization, The

Opposition

None on file

Analysis Prepared by: Ryan Ojakian / W., P., & W. / (916) 319-2096

 THIRD READING  

Bill No: SB 881

Author:

:

Vote:

SENATE NATURAL RES. & WATER COMMITTEE: 8-0, 3/13/18

AYES: Hertzberg, Stone, Allen, Jackson, McGuire, Monning, Stern, Vidak

NO VOTE RECORDED: Hueso

SENATE JUDICIARY COMMITTEE: 7-0, 4/17/18

AYES: Jackson, Moorlach, Anderson, Hertzberg, Monning, Stern, Wieckowski

SENATE APPROPRIATIONS COMMITTEE: 7-0, 5/25/18

AYES: Lara, Bates, Beall, Bradford, Hill, Nielsen, Wiener

SUBJECT:

SOURCE: Santa Clara Valley Water District

DIGEST:

This bill authorizes the state to provide subvention funds to the Santa Clara Valley Water District for the South San Francisco Bay Shoreline Project (project) if specified conditions are met. This bill also specifies that the state assumes no liability for damages that may result from the project.

ANALYSIS:

Existing law:

1. Provides, pursuant to the State Water Resources Law of 1945, that the state may participate in funding local flood control projects that are authorized by the legislature and that meet all of the following criteria:
   1. The project qualifies for federal financial assistance and is authorized by Congress. Projects may be authorized pursuant to a Chief Engineer’s report, but cannot receive state funding until authorized by Congress.
   2. The total annual benefit exceeds the annual cost of providing protection from flood damages.
   3. The project provides protection from flood damages in the most efficient manner practicable, and with due regard for environmental and recreational considerations, and local economic conditions.
   4. The project's nonfederal sponsor is in compliance with federal laws requiring the preparation, adoption, and implementation of a floodplain management plan.
   5. All local communities benefiting from the project have an ordinance consistent with the National Flood Insurance Program's model floodplain management ordinance.
   6. The project avoids, minimizes, or mitigates impacts to environmental and recreational values.
   7. Project planning documents include an evaluation of opportunities to include multipurpose objectives.
   8. The nonfederal sponsor accommodates other partners who wish to provide the costs of including multipurpose objectives that are compatible with the project’s purpose and schedule.
2. Provides that before receiving payment or reimbursement from the state, the local agency must enter into an agreement with the Department of Water Resources (DWR) under which the local agency agrees to indemnify, hold, and save the state, and its officers, agents, and employees, harmless from any and all liabilities from damages associated with the maintenance and operation of the project.

This bill:

Authorizes the state to provide subvention funds to the Santa Clara Valley Water District for the for flood control in areas of the Project if the project is constructed in accordance with the federal Water Infrastructure Improvements for the Nation Act (Public Law 114-322) and substantially in accordance with the recommendations of the Engineers Report developed by the United States Army Corps of Engineers Chief of Engineers.

Provides that the state assumes no liability for damages that may result from the project by either of the following:

Authorizing the provision of subvention funds in accordance with this section.

The appropriation by the Legislature of these subvention funds upon the recommendations and advice of DWR.

Conditions the subvention funding on the county or local agency entering into an agreement with DWR whereby the county or local agency agrees to indemnify and hold and save harmless the state, its officers, agents, and employees for any and all liability for damages that may result from the project.

FISCAL EFFECT: Appropriation: Fiscal Com.: Local:

According to the Senate Appropriations Committee, significant cost pressures in the low- to mid-millions (likely bond funds) for subvention reimbursements.

SUPPORT: (Verified 5/25/18)

Santa Clara Valley Water District (source)

California Municipal Utilities Association

California Special Districts Association

City of Palo Alto

City of San Jose

Midpeninsula Regional Open Space District

Milpitas Chamber of Commerce

Santa Clara Chamber of Commerce

Santa Clara Valley Open Space Authority

Silicon Valley Leadership Group

OPPOSITION: (Verified 5/25/18)

None received

ARGUMENTS IN SUPPORT: According to the author, “SB 881 would add the South San Francisco Bay Shoreline Project (Shoreline Project) of the Santa Clara Valley Water District (District) to the list of flood control projects authorized to receive state flood control subventions reimbursements in accordance with the process established in existing law.

“California is challenged by the increased intensity of storms and rising sea levels brought on by global warming and climate change. While no single storm can be directly attributed to climate change, the increased volatility in local climates is taking a toll. Sea level rise, already felt in Bay Area coastal communities, requires a multi-faceted response involving significant public works projects that couple levees with natural barriers such as restoring marshes to increase the resiliency of the shoreline to storm actions and sea level rise.

“The Shoreline Project incorporates a multi-benefit approach to flood protection by combining environmental restoration of wetlands and traditional levee construction to protect properties in the South San Francisco Bay Area. The project would provide flood protection to portions of Palo Alto, Mountain View, Sunnyvale, San Jose, and the community of Alviso from the risk of high tides and rising seas.”

Prepared by:

5/26/18 15:20:25

**** END ****

SENATE COMMITTEE ON

Senator Ricardo Lara, Chair

2017 - 2018 Regular Session

SB 881 (Wieckowski) - Flood control: County of Santa Clara: South San Francisco Bay Shoreline Project

This bill meets the criteria for referral to the Suspense File.

Bill Summary:

SB 881 authorizes the state to provide subvention funds to the Santa Clara Valley Water District (District) for the South San Francisco Bay Shoreline Project (project) if specified conditions are met. The bill also specifies that the state assumes no liability for damages that may result from the project.

Fiscal Impact:

Significant cost pressures in the low- to mid-millions (likely bond funds) for subvention reimbursements. (See staff comments)

Background:

The Flood Control Subventions Program (program). The program provides financial assistance to local agencies participating in the construction of federally authorized flood control projects located outside of the Central Valley. The Department of Water Resources (DWR) administers the program and disburses subvention reimbursements to eligible (federally authorized) projects that fall into one of three categories:

• Major Flood Control Projects (authorized by United State Army Corp of Engineers (USACE) and Congress)
• Small Flood Control Projects (small USACE projects authorized by the federal Flood Control Act and USACE)
• Watershed Protection Projects (Natural Resources Conservation Service (NRCS) projects authorized by California Water Code and the Administrator of the NRCS after the reports are reviewed by the Agriculture Committees of Congress).

Typically, the federal government provides funding for 50 to 75 percent of a project’s cost and the local agency, as the entity participating in the project construction under agreement with the federal agency, is responsible for providing the nonfederal share of project costs to the federal agency. If the local agency complies with the Water Code and program guidelines, the state will reimburse the local entity for 50 to 70 percent of the nonfederal share (not to exceed specified limits). The reimbursement rate is based on how effectively the project achieves multi-purpose objectives. After reimbursement, the distribution of project costs is as follows:

federal funds (50-75%) + state funds (19-25%) + local funds (6-25%)

Proposed Law: This bill:

Authorizes the state to provide subvention funds to the District for the for flood control in areas of the Project if the project is constructed in accordance with the federal Water Infrastructure Improvements for the Nation Act (Public Law 114-322) and substantially in accordance with the recommendations of the Engineers Report developed by the USACE’s Chief of Engineers.

Provides that the state assumes no liability for damages that may result from the project by either of the following:

Authorizing the provision of subvention funds in accordance with this section.

The appropriation by the Legislature of these subvention funds upon the recommendations and advice of the department.

Conditions the subvention funding on the county or local agency entering into an agreement with DWR whereby the county or local agency agrees to indemnify and hold and save harmless the state, its officers, agents, and employees for any and all liability for damages that may result from the project.

Staff Comments:

Project subventions. According to the District, the total project costs equal $177 million, of which approximately $4 to $7 million would be eligible for subventions payments. (Subventions are only paid for flood protection elements of a project.) DWR’s calculations tentatively supports the district’s figures, but note the potential for state liability up to $50 million for eligible future elements should the project change to incorporate any or all of the elements.

The District indicates that it does not plan to seek subventions for the restoration. Instead, the State Coastal Conservancy, the project partner, seeks to cover those costs with local and statewide bond funds. Once prepared, the State Cost-Share Report to DWR will identify the estimated $4 to 7 million.

Program funding. According to DWR, the program has been bond funded for roughly 16 years. Approximately $210 million in Proposition 1E funds (which will be spent down through June 2023) and about $50 million in Proposition 84 funds are currently available to spend. DWR anticipates about $218 million in reimbursement expenses over the next five years on existing authorized projects and four projects that are expected to become “newly authorized projects” requiring an estimated $200 million to $475 million in future reimbursement requests.

.-- END --

SENATE JUDICIARY COMMITTEE

Senator Hannah-Beth Jackson, Chair

2017-2018 Regular Session

Bill No: SB 881 (Author:Wieckowski)

Version: April 3, 2018

Hearing Date: April 17, 2018

Fiscal: Yes

Urgency: No

Consultant: CK

SUBJECT

Flood control: County of Santa Clara: South San Francisco Bay Shoreline Project

DESCRIPTION

This bill would add the South San Francisco Bay Shoreline Project of the Santa Clara Valley Water District to the list of flood control projects authorized to receive state flood control subventions reimbursements. It would make clear that the state assumes no liability for damages that may result from the project through the authorization and appropriation of subvention funds and requires the District to indemnify the state, as specified.

BACKGROUND

The State Water Resources Law of 1945 provides for the study and funding of flood control projects throughout the state. (Wat. Code Sec. 12570 et seq.) The state has declared that the control, storage, and full beneficial use of flood waters, the prevention of damage by flood waters, and the washing away of river and stream banks by floods are proper functions and activities of the State, in cooperation with counties, cities, state agencies, and public districts, and in cooperation with the United States, or any of its departments or agencies. (Wat. Code Sec. 12579.) Existing law provides the processes and guidelines for the provision of subvention funds for projects authorized by the Legislature.

The Department of Water Resources (DWR) administers the Flood Control Subventions Program. DWR’s Web site lays out the process: “When projects are federally authorized, local agencies are responsible for soliciting the State to consider cost sharing in the project. After we evaluate the project benefits, we may submit a report to the Legislature with an eligibility determination. If the project is approved by the California Legislature and specifically added to the California Water Code, we can share in the non-federal costs of the project.”

This bill would authorize subvention funds in connection with the South San Francisco Bay Shoreline Project. The Santa Clara Valley Water District is the lead agency on the project and has partnered with the State Coastal Conservancy and the U.S. Army Corps of Engineers. According to the author:

The total design and construction cost for the flood risk management structures, ecosystem restoration, and recreational improvements is estimated to be $177 million. The total non-federal share of this project cost will be $105.5 million with $43 million for the levee and related structures, $59 million for the ecosystem restoration, and $3.5 million for the recreational improvements. The District will provide $45 million to cover the flood aspects of the project, with an estimated $4 to $7 million expected to be eligible for the state flood subventions reimbursements.

The Shoreline Project will increase flood protection for Silicon Valley where a 100-year coastal flood event could cause billions in damages, impacting thousands of acres and thousands of structures including roads, highways, parks, an airport, sewage treatment plants, and utility infrastructure.

According to the analysis completed by the Senate Natural Resources and Water Committee, the project authorized by this bill appears to meet all the requirements for state subvention funding.

This bill recently passed the Senate Natural Resources and Water Committee on an 8-0 vote.

CHANGES TO EXISTING LAW

Existing law, the State Water Resources Law of 1945, provides for the study and funding of flood control projects throughout the state. (Wat. Code Sec. 12570 et seq.)

Existing law, the Flood Control Law of 1946, provides there is a state interest in assuming the cost of cooperation by the State with the United States in the construction of flood control projects. (Wat. Code Sec. 12800 et seq.)

Existing law provides that the control, storage and full beneficial use of flood waters, and the prevention of damage by flood waters, and the washing away of river and stream banks by floods are proper functions and activities of the State, in cooperation with counties, cities, state agencies and public districts, and in cooperation with the United States, or any of its departments or agencies. (Wat. Code Sec. 12579.)

Existing law declares the State should engage in the study and coordination of all water development projects, including flood control projects, undertaken by counties, cities, state agencies and public districts, and the United States or any of its departments or agencies in order that such allocations and appropriations as are made by the State Legislature for such purposes will be expended upon those projects which are most beneficial to the State, and which will bring maximum benefits to the people of the State from the expenditure of public funds, and also that the State should participate in the construction of flood control works and projects and render beneficial aid thereto, when the benefits are in excess of the estimated cost. (Wat. Code Sec. 12580.)

Existing law requires a flood management project that receives financial assistance pursuant to the State Water Resources Law of 1945 or the Flood Control Law of 1946 to meet all of the following requirements prior to state authorization:

• the project shall qualify for federal financial assistance under the requirements applicable to federal water resource development projects and shall be federally authorized;
• the total annual benefit of providing protection from flood damages shall exceed the annual cost of the project allocable to flood management. The project shall be designed to produce the greatest feasible reduction in flood damages in the most efficient manner practicable, with due regard for environmental and recreational considerations, and local economic conditions, as specified;
• the project’s nonfederal sponsor, or other appropriate local agency, shall be in compliance with Section 701b–12 of Title 33 of the United States Code, which requires the preparation, adoption, and implementation of a floodplain management plan designed to reduce the impacts of future floods. All local communities benefiting from the project shall have an ordinance consistent with the National Flood Insurance Program’s model floodplain management ordinance;
• the project shall avoid, minimize, or mitigate impacts to environmental and recreational values; and,
• project planning documents shall include an evaluation of opportunities to include multipurpose objectives. The nonfederal sponsor shall accommodate other partners that provide the costs of including multipurpose objectives that the nonfederal sponsor determines are compatible with the project’s schedule and primary flood management purpose. (Wat Code Sec. 12582.7(a).)

Existing law provides that the Reclamation Board or department, in its advisory role, shall provide sufficient review and oversight in the initial scoping process, feasibility evaluation, environmental review, and project approval processes for flood management projects to determine whether the requirements set forth above are met. The department or the Reclamation Board shall inform the nonfederal sponsor and any local sponsor whether the project meets those requirements during the feasibility evaluation and environmental review process. Prior to state authorization, the department or the Reclamation Board shall submit a report to the Legislature that indicates whether the project meets the requirements. (Wat. Code Sec. 12582.7(b).)

Existing law provides the guidelines and procedures for the provision of subvention funds for projects authorized by the Legislature on or after January 1, 2002. (Wat. Code Sec. 12585.7.)

This bill would authorize subvention funds in accordance with Section 12585.7 to the Santa Clara Valley Water District for the South San Francisco Bay Shoreline Project for flood control in areas along the south San Francisco Bay in the County of Santa Clara, that is authorized by Section 1401 of the federal Water Infrastructure Improvements for the Nation Act (Public Law 114-322) and that is substantially in accordance with the recommendations of the Chief of Engineers of the United States Army Corps of Engineers Report, dated December 18, 2015, as follows:

• at an estimated cost to the state of the sum that may be appropriated for state cooperation by the Legislature upon the recommendations and advice of the department; and
• upon a specific written determination by the department that the project meets the requirements of Section 12582.7.

This bill would provide that the state assumes no liability for damages that may result from the project by either of the following:

• authorizing the provision of subvention funds in accordance with this section;
• the appropriation by the Legislature of these subvention funds upon the recommendations and advice of the department.

This bill would define “liability for damages” to include liability for damages relating to the construction or operation of the project or the failure of the project to operate as intended. The bill would provide that the Santa Clara Valley Water District may receive the subvention funds only if it enters into an agreement with the department pursuant to which the District agrees to indemnify and hold and save harmless the state, its officers, agents, and employees for any and all liability for damages that may result from the planning, design, construction, operation, maintenance, repair, and rehabilitation of the flood protection components of the project.

COMMENT

1. Stated need for the bill

According to the author:

SB 881 would add the South San Francisco Bay Shoreline Project (Shoreline Project) of the Santa Clara Valley Water District (District) to the list of flood control projects authorized to receive state flood control subventions reimbursements in accordance with the process established in existing law.

California is challenged by the increased intensity of storms and rising sea levels brought on by global warming and climate change. While no single storm can be directly attributed to climate change, the increased volatility in local climates is taking a toll. Sea level rise, already felt in Bay Area coastal communities, requires a multi-faceted response involving significant public works projects that couple levees with natural barriers such as restoring marshes to increase the resiliency of the shoreline to storm actions and sea level rise.

The Shoreline Project incorporates a multi-benefit approach to flood protection by combining environmental restoration of wetlands and traditional levee construction to protect properties in the South San Francisco Bay Area. The project would provide flood protection to portions of Palo Alto, Mountain View, Sunnyvale, San Jose, and the community of Alviso from the risk of high tides and rising seas.

The project will help protect globally-recognized businesses that power the region’s and the nation’s economy, including Cisco and Google, as well as three wastewater facilities that are critical to the communities of Palo Alto, Sunnyvale, San Jose, and Santa Clara. The area at risk also includes the NASA/Ames Research Center.

SB 881 would authorize state flood control subventions funding, subject to the requirements established in current law, for reimbursement of a small portion of costs for a vitally important project that will help protect an area of national economic importance. Protecting Silicon Valley from tidal flood risk exacerbated by intensifying storms and sea level rise is sound public policy and a smart public investment.

2. Indemnification

This bill would define “liability for damages” to include liability for damages relating to the construction or operation of the project or the failure of the project to operate as intended. The bill would provide that the state assumes no liability for damages resulting from the project by either of the following:

• authorizing the provision of subvention funds in accordance with this section; or,
• the appropriation by the Legislature of these subvention funds upon the recommendations and advice of the department.

These specific provisions have been included in numerous flood control projects and insulate the state from liability for simply facilitating the funding of these projects. (See

Wat. Code Secs. 12687.5, 12748.3, 12749.98.)

In addition, this bill would provide that the Santa Clara Valley Water District may receive the subvention funds only if it enters into an agreement with the department pursuant to which the District agrees to indemnify and hold and save harmless the state, its officers, agents, and employees for any and all liability for damages that may result from the planning, design, construction, operation, maintenance, repair, and rehabilitation of the flood protection components of the project. Again, language similar to this is found in various statutes and ensures that the state is not taking on responsibility for the various projects funded through the State Water Resources Law of 1945. (See Wat. Code Secs. 12670.11, 12670.22, 12670.23, 12687.5, 12748.3, 12749.98.) However, one difference with this particular project is that there is a state agency involved as a partner in the project, the State Coastal Conservancy. Therefore, the language of the bill could effectively immunize the State Coastal Conservancy from liability arising from its partnership in the project.

It should be noted that existing law separately provides that “[p]rior to any local agency receiving payment or reimbursement pursuant to Section 12585.5 or 12585.7, for projects authorized on or after January 1, 2001, the agency shall enter into an agreement with the department or Reclamation Board pursuant to which the agency agrees to indemnify and hold and save the state, and its officers, agents, and employees, harmless from any and all liability for damages, as provided in Sections 12642 and 12828.” (Wat. Code Sec. 12643.) Section 12642 of the Water Code provides that “where the Federal Government does not maintain and operate projects, it is the responsibility and duty of the county, city, state agency, or public district affected to maintain and operate flood control and other works, constructed pursuant to Chapters 1 and 2 of this part, after their completion and hold and save the State and the United States free from damages.”

The language used in this bill has been narrowed to apply only to the “planning, design, construction, operation, maintenance, repair, and rehabilitation of the flood protection components of the project.” This language would therefore require the District to indemnify the state for the flood control elements that arguably should be borne by the lead agency, here the District. The provision does not implicate the other components of the project, such as the ecosystem restoration, which the Coastal Conservancy will be more actively involved.

Support: California Municipal Utilities Association; California Special Districts Association; City of San Jose Councilmember Lan Diep; County of Santa Clara; Midpeninsula Regional Open Space District; Milpitas Chamber of Commerce; Palo Alto City Council; Santa Clara Chamber of Commerce; Santa Clara Valley Open Space Authority; Silicon Valley Leadership Group; The Silicon Valley Organization

Opposition: None Known

HISTORY

Source: Santa Clara Valley Water District

Related Pending Legislation: None Known

Prior Legislation: SB 619 (Strickland, Ch. 195, Stats. 2009) added the Lower Mission Creek project, which is in the County of Santa Barbara, to the list of approved projects to receive state subventions funding. It provides the template for the current bill.

Prior Vote: Senate Natural Resources and Water Committee (Ayes 8, Noes 0)

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SENATE COMMITTEE ON NATURAL RESOURCES AND WATER

Senator Robert Hertzberg, Chair

2017 - 2018 Regular

Bill No: SB Hearing Date: March 13, 2018

Subject: Flood control: County of Santa Clara: South San Francisco Bay Shoreline Project

BACKGROUND AND EXISTING LAW

1. Under the State Water Resources Law of 1945, §12582.7, the state may participate in funding local flood control projects that are authorized by the legislature and that meet all of the following criteria:

• The project qualifies for federal financial assistance and is authorized by Congress. Projects may be authorized pursuant to a Chief Engineer’s report, but cannot receive state funding until authorized by Congress.
• The total annual benefit exceeds the annual cost of providing protection from flood damages.
• The project provides protection from flood damages in the most efficient manner practicable, and with due regard for environmental and recreational considerations, and local economic conditions.
• The project's nonfederal sponsor is in compliance with federal laws requiring the preparation, adoption, and implementation of a floodplain management plan.
• All local communities benefiting from the project have an ordinance consistent with the National Flood Insurance Program's model floodplain management ordinance.
• The project avoids, minimizes, or mitigates impacts to environmental and recreational values.
• Project planning documents include an evaluation of opportunities to include multipurpose objectives.
• The nonfederal sponsor accommodates other partners who wish to provide the costs of including multipurpose objectives that are compatible with the project’s purpose and schedule.

1. Before receiving payment or reimbursement from the state, the local agency must enter into an agreement with the Department of Water Resources (DWR) under which the local agency agrees to indemnify, hold, and save the state, and its officers, agents, and employees, harmless from any and all liabilities from damages associated with the maintenance and operation of the project. §12643

PROPOSED LAW

This bill would:

1. Authorize the state to provide subvention funds to the Santa Clara Valley Water District for the South San Francisco Bay Shoreline Project for flood control in areas along the south San Francisco Bay in the County of Santa Clara, that is authorized by Section 1401 of the federal Water Infrastructure Improvements for the Nation Act (Public Law 114-322) and that is substantially in accordance with the recommendations of the Chief of Engineers of the United States Army Corps of Engineers Report.
2. Provide that the state assumes no liability for damages that may result from the project by either of the following:

• Authorizing the provision of subvention funds in accordance with this section.
• The appropriation by the Legislature of these subvention funds upon the recommendations and advice of the department.

1. Condition the subvention funding on the county or local agency entering into an agreement with DWR whereby the county or local agency agrees to indemnify and hold and save harmless the state, its officers, agents, and employees for any and all liability for damages that may result from the project.

ARGUMENTS IN SUPPORT

According to the author, “SB 881 would add the South San Francisco Bay Shoreline Project (Shoreline Project) of the Santa Clara Valley Water District (District) to the list of flood control projects authorized to receive state flood control subventions reimbursements in accordance with the process established in existing law.

California is challenged by the increased intensity of storms and rising sea levels brought on by global warming and climate change. While no single storm can be directly attributed to climate change, the increased volatility in local climates is taking a toll. Sea level rise, already felt in Bay Area coastal communities, requires a multi-faceted response involving significant public works projects that couple levees with natural barriers such as restoring marshes to increase the resiliency of the shoreline to storm actions and sea level rise.

The Shoreline Project incorporates a multi-benefit approach to flood protection by combining environmental restoration of wetlands and traditional levee construction to protect properties in the South San Francisco Bay Area. The project would provide flood protection to portions of Palo Alto, Mountain View, Sunnyvale, San Jose, and the community of Alviso from the risk of high tides and rising seas.”

ARGUMENTS IN OPPOSITION: None received

COMMENTS

The project authorized by this bill appears to meet all the requirements for state subvention funding.

Double-referral The Rules Committee referred this bill to both the Committee on Natural Resources and Water and to the Committee on Judiciary. Therefore, if this bill passes this committee, it will be referred to the Committee on Judiciary, which will consider the issues within their jurisdiction

SUGGESTED AMENDMENTS: None

SUPPORT

Santa Clara Valley Water District (Sponsor)

California Municipal Utilities Association

City of San Jose

Midpeninsula Regional Open Space District

Milpitas Chamber of Commerce

Santa Clara Chamber of Commerce

Santa Clara Valley Open Space Authority

Silicon Valley Leadership Group

OPPOSITION

None Received

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