Senate Standing Committee on Rules

The Senate Committee on rules, will come to order. Before we begin today's agenda, can we please establish quorum and also welcome our new member to this committee, Senator Rosilicie Ochoa Bogh. Welcome.

Thank you, Beth. Madam Chair?

[Roll call]

Thank you. We've established quorum. If there's no objection, I'd like to take up first on today's agenda. Governor's appointments not required to appear. Starting with item 2C, the appointment of Anthony Surich as executive director of California Housing Finance Agency.

I will entertain a motion.

So moved.

We have a motion by Senator Reyes. Can we please call the roll?

[Roll call]

Alright. That item is approved. Four to zero. The next item for governor's appointments not required to appear is item 2D, Craig Snellings, JD as a member of the Workers' Compensation Appeals Board. I'll entertain a motion.

So moved. Thank you, Senator Laird, for making that motion. Can we please call the roll?

[Roll call]

Four to zero. Last item for governor's appointments not required to appear is item 2E, Nicholas Mueller for the Off Highway Motor Vehicle Recreation Commission. I'll enter it in a motion, please.

So moved.

Thank you, Senator Reyes. Can we please call the roll?

[Roll call]. Four to zero.

That item is approved. Four to zero. Our final item before we turn to governor appointees is item three, reference of bills to committees. I'll entertain a motion. So moved.

Thank you, Senator Laird, for making that motion. Can we please call the roll?

[Roll call]. Four to zero.

Alright. That motion is approved, four to zero. We are now going to turn to governor's appointees required to appear. Item one a, the appointment of Dorene D'Adamo, JD as a member of the State Water Resources Control Board. You are welcome to come forward, Miss D'Adamo.

You will have the opportunity to provide one to two minutes, for your opening testimony to this committee. In your opening, you're welcome to introduce any guest to that you may have here with you today. We will keep time of your opening, and we will prompt you when you are, approaching that time. You're welcome to begin.

Thank you so much, Senator, Members of the Committee. I'm really honored to be here today, and just also want to thank those of you who, I had the opportunity to meet with you and your staff. Thank you for that additional time. I love talking water and I know you do too. So thank you for that.

Before starting this statement, I'd just like to introduce my husband of forty two years, Berj Musikian. We reside in Turlock where we've raised, our family and just really happy that he could be here, to support me today. California water, as we know, is really complex, but particularly at this critical time as we're confronted with the effects of the changing climate that brings more frequent, longer lasting droughts, atmospheric rivers, and what we all have come to know as weather whiplash.

This calls upon our state and our board to be resilient in the face of climate change and to be to more actively manage our finite water supplies. I'd like to point out a few of my top priorities, but honestly, we work so well as a team at the board.

I, I believe I can say that this is these are top priorities for all of us at the board. Water use efficiency standards that provide for flexibility for local solutions, making conservation a way of life all the time. Drought. Implementation of the sustainable ground water management act in critically overdrafted basins that have been referred to our board from the department of water resources, working closely with these basins to get them on the path of sustainability.

Increasing opportunities for groundwater recharge permits, capture of high storm flows, and recycled water as we seek to meet the targets in the updated California water plan.

Healthy watersheds and ecosystem resilience through regulations to require flows in critical salmon bearing streams during drought, streamline permitting of ecosystem restoration projects, updates to the Bay Delta plan to provide for increased flow and ecosystem improvements. And I'm most proud of the progress that we've made on access to safe and affordable drinking water Since the passage of the safe and affordable fund in 2019 by the legislature, the number of Californians without access to safe drinking water has dropped from 1,600,000 to 800,000.

We still have a long way to go, and our board is committed to continuing this momentum, and I'm just really proud to be part of that effort. Thank you so much for the opportunity to provide my remarks, and I look forward to answering any questions you may have. Alright.

Thank you. Members, we'll begin with questions or comments. Any questions or comments? Senator Ochoa Bogh?

Thank you, Madam Chair. And thank you for meeting with with me and my and my team. Really enjoyed our conversation. The state auditor raised concerns with the safe drinking water program in 2022. Can you share with us any of the changes that have been made to the program since the audit?

Are there any state auditor recommendations left to complete with respect to the fixing the delays and oversight of its safe drinking water programs? And lastly, how are you monitoring this program to ensure we don't slide backwards from the improvement made so far?

Well, thank you for that question. So as I said, since 2019, the establishment of the program, we've been able to reduce the number from 1.6 to 800,000. And what I'd like to share with you is, some of the key strategies that we've used in order to get there. So first of all, we have a safer, advisory committee. It's important

Miss, that one, just really quickly. Are those, recommendations or the the what you've done, are those, response to the audit that was done in 2022?

Well, the the audit really focused on, momentum of the program, and so I, I think that just the the first few years of the program, it was important for us to get a handle on just even the assessment, and so it may have been a little slower going at first.

There were a lot of questions about the amount of funds that we provide for technical assistance, but the technical assistance that we provide to local communities really, I think we've been able to show that that has been what has led to solutions for communities and actual projects. So it was in response to the it was in response to the audit, but these are things that we were doing

that we were in process of doing anyway.

Okay. So, so the question, once again, is about what the audit came back with as far as their recommendations, and how the, the board has actually either implemented or not some of those recommendations. That's where I'm I'm heading. That's what I would like to know.

Yes. And I appreciate that. And I'm just not it's been a while since I've, you know, looked at the report. I was satisfied when I looked at the report knowing what process was underway with the development of this new program. And, the the reason for the focus on, we have an advisory committee that it was important for us not to have, not to implement these, funds, from the top down, but really to listen to communities.

So, it took a little bit of time for us to get a system in place, developing an advisory committee, making sure that we had voices from throughout the state, And then, also the development of an annual needs assessment. And that's really helped us to be able to target, you know, the highest priority, as far as, you know, projects that we should be looking at.

And all this done before the audit?

It was, it was underway while the audit was being developed.

Yes. Yes.

This is done since. Yes.

Thank you.

Yeah. In, in, in, in, full implementation. Now, this is a system that, you know, we get an annual needs assessment. It goes before the, advisory committee for their input. Just making sure that we're looking at all of the the right factors as we determine the need.

Also, moving beyond systems, not just looking at large systems, small systems, but also domestic wells, trying to get a better handle on the number of people in California that don't have safe drinking water. And so the program, you know, truly is growing. We have, as I said, a long way to go before we can say that we have achieved the human right to water for all Californians. But I'm really proud of the work that we've done.

And one area that we have really focused on is consolidation.

Before we received authorities from this body, for mandatory consolidation, we had, on average, about four consolidations a year. Since 2019, we've had a 180 consolidations. So we've been using that mandatory authority that you've provided us in a very strategic way. We have 200 consolidations that are in progress. And so, Aye, I do expect that, you know, we're going to see those numbers coming down as our staff moves forward.

That it doesn't go quickly because we work directly with communities, to make sure that we, are working with the communities on the development of long term sustainable supplies.

And then a follow-up question to that would be, so from those, realizing that one at 1,600,000 people were not, did not have access to clean, safe water, Now, you're at 800 thou 800,000 people. That's within the scope of seven years. What do you what is expected in the next couple of years? When do you think that we'll be able to meet that expectation of having the rest of the 800,000 folks?

I, I can't speak to the trajectory, but I do know, I'm not remembering the numbers right now, but I've seen our staff has put together because of the needs assessment and determining let's see here. I've got, on our annual needs assessment, the most recent one, we have 390 failing systems, public water systems, that are serving, 811,000 people. And then, we have 589 that are at risk of failing, potentially could fail. So we're watching through those systems as well.

So what I expect to happen is we we're gonna be prioritizing the failing systems, and then as those at risk systems potentially move into the failing systems, you know, keeping track, as we go.

So, there'll be systems that will come off the list, and, and then potentially others that go on the list. Okay.

Thank you, ma'am.

Thank you. Next, we'll go to Senator Laird.

Thank you very much and thank you for the time, to meet. I really appreciated it. And I would like to pick up, on that question. I happen to have been on the audit committee when the audit was done. And I think the key fact is is there was 1,600,000 Californians that didn't have safe clean drinking water.

By the time the audit was released, it was 1,000,000. So actually, the water board had moved 600,000 people into safe clean drinking water before that audit came out. And, and now as you say, it's 200,000 more.

And I think my question and, and I know I've done legislation on this because one of the problems you mentioned consolidation and one of the problems is is there's a disadvantaged community next to a non disadvantaged community and the law actually said the grant only went to the disadvantaged community and yet many times it was the community that was gonna take them in that needed the assistance. So I did a bill saying the grant could go either way.

Could go to the community coming in or the community taking it in, whatever it would take to facilitate it. But now, you you gave the precise numbers of 811,000 and everything. But as hard as this is to believe, the easier ones have been done and you are to the harder ones. So framing the question a little differently, what's in front of mind for you in trying to do the harder ones that are still ahead?

Well, you are spot on. So I, I, I wouldn't say that of the 200 that are in process that that they're gonna be more challenging. It's a matter of getting getting through the list. But as we move along, it is gonna get more challenging. The easier ones have been done.

And so, I think, you know, just looking at other tools that we might have, this, the safer, fund that the legislature has provided has been so helpful because it's so much more flexible than the revolving fund program that we have. And so, it's allowed us along with the authorities, whether it's consolidation or providing funding to the receiving, entity, it's provided us for the flexibility, and these things take time, because as I said, it's not top down.

We spend a lot of time with the communities to find out what is it that they're desiring. And so, I think that, it's, it's really been a successful program because of that. But as it gets more difficult, we're probably gonna have to look at, you know, if it's increased cost, but also, regionalization, ways to manage these systems.

These smaller systems are suffering from, you know, just they don't have the rate payer base, and then, because they don't have the funds coming in, you know, a lack of technical, managerial, and financial capacity to manage those systems. And so, you know, doing remote, having management consolidation, whether through regionalization or an entity that manages several of these systems.

So there's lots of different approaches that we can take as we go forward, but I think where it's helpful also is to have the ongoing input from communities, through this advisory committee. I actually attended advisory committee in, Salinas a few months ago, and it was and did a tour, went out and visited, a school that didn't have access to safe drinking water, domestic wells, near agricultural area and a number of others, places.

But, you know, to hear their passion and their desire for systems that they're looking for for, how they can be brought together, I think that gives us that that puts us on a path of success.

Well that was a very smart move to reference that you visited my district. Yes. And just we talked and maybe it's good to make a comment in front of the full committee. We talked about some of the problems that exist and, and there's one that's been represented in my district where the, the CZU fire was. It burned a lot of the houses and the brand new water pipe and everything for water district outside of Big Basin Park.

And now the the goal is to have them consolidate. But according to both sides, they're in a receivership now and the district going in, the water board is forcing a decision on a consolidation and then will trigger the feasibility study. And the water district that's taking them says, no. We want the feasibility study before we make the decision to take them.

And, and I think the the other one is as a legislature and the governor in putting prop four on revised the limits for projects and for the San Lucas one Where this little farm worker community is just about completely out of safe clean drinking water.

This allows the the state to have the financial authority to reach the level of the project and do the consolidation. And that's a non contiguous consolidation. And who knew that that you wanted a public district to go into a a company that's private but that allows the PUC to do rate support for the low income people.

So I guess my question is is do you find yourself grappling with the complexity of each of these issues and are you committed to sort of trying to break down these bureaucratic barriers to just push these projects ahead?

Yeah. I think at at our level, just because we have so many of these projects and we have a very dedicated team between, our division of drinking water and the division of financial assistance, we also have, an ongoing, you can submit your request in for financial assistance at any time. So there's not a deadline. And we try to keep it very flexible. We have an annual process that comes before us.

So we have the the, the state revolving fund, drinking water intended use plan. So that'll come before us by way of a workshop, and then for a final determination. Same thing for wastewater. And then we also have a fund expenditure plan for the safer, funds that the legislature's provided us. So there's multiple touch points, for us to, hear from communities directly, and then of course, we have nine regional boards, and, we split them up amongst the five Board Members.

So we spend a lot of time, in specific regions, and so then we'll hear from folks directly. As, the person on the board that has, irrigated agriculture, I've spent a lot of time in in your area because of, you know, the agricultural involvement there, at at San Lucas, San Gerardo, and, you know, these places that were green filled. So that has really been helpful, as I interact with staff.

I did wanna bring up one other thing, Senator, and that is that, I think it's important for us to, getting back to being creative, you know, on the on the challenges. The domestic well issue is a particular, concern, but we don't have jurisdiction over domestic wells.

But we're working with the ag community on the domestic well issue in two fronts. One is through our irrigated lands regulatory program, you know, trying to reduce, the, unnecessary or excess amount of nitrogen that gets applied, working with the AI communities on that program. But also, there's a program in the Central Valley. It's called CV Salt. And that program, it's, it's got an odd name because it doesn't necessarily fit Central Valley Salinity Alternatives for long term sustainability.

So they started, this was a collaborative effort between the regulated community, local communities, and also the regional board looking at Salt Buildup. And it morphed into a program looking at nitrates. And so what we have now through that regional board is an actual program that does provide funding, interim funding, and they're supposed to be working on long term solutions.

And so there's some synergy here between the SAFER funds, that program, in the Central Valley region, and we're hoping that a similar program will be developed on the Central Coast. And then another program is SGMA, the sustainable groundwater management act that we're trying to have synergies with, what they're doing in that program as well on domestic wells.

I had plenty of questions. My colleagues are are here because you raised SGMA and you do the groundwater permits for recharge and you have availed yourself of the DWR subsidence report in relation to what you're doing and maybe others will wanna ask about that.

But I have one more question you just sort of teed it up because I think one of the challenges in serving on your board and other boards is that with just five people or whatever it is, we want people from all over the state and we want people of some different perspectives that have credibility with different constituency groups that they don't usually have.

And you have come from a more agricultural area and it seems to me having watched you for the years you've been on the board that you're able to deliver hard news that they might not hear from anybody else And other times you're able to represent them into the process in a way where other people aren't doing it. Could you speak a little bit to that role and why you think it's important to somebody with that diversity and with that ability to talk to different stakeholders.

Sure. Well, agriculture is the largest water user in the state and

And I am channeling Senator Grove who is not here. So just for the record.

Well, thank you for that. Yeah. So, I, I live in the San Joaquin Valley, worked in the San Joaquin Valley for many years for members of Congress and worked primarily on agricultural, environmental, water issues, air quality, which is what brought me to the air board initially. And, I have found that, because of the, strong relationships that I've developed through the years in agriculture, I also, I, I am, trusted by that community.

I think that it can raise concerns that am I gonna just do whatever that community is asking for?

And the answer to that is no, because I am really motivated to be on this board out of protection of water quality and, protection of our water rights and balancing all beneficial uses, not just agriculture. And so what I have found through time is that, first of all, I'm able to flag issues for our staff and, you know, that I just bring up with the board about, well, gee, that may not necessarily work. This idea may not work, in practice as we're thinking.

So I think, it's been helpful to have someone that has an understanding of agricultural practices, and then also to play, the tough role with agriculture, who might be resisting, say, Sigma initially, and then spending time with those communities and making sure that they understand we will undertake the role. We have a responsibility that the legislature has provided to us, and we will undertake that responsibility.

So come along, join in, you know, the parade, and get to sustainable groundwater management, you know, and then working. And then I'll spend the time in those communities and offered up also, you know, like, maybe there's a general manager that understands, yes, we need to do more to come into sustainability, but maybe their board doesn't or maybe growers don't really appreciate, you know, the, the challenges and what could come their way with regulation, through Sigma, and so spending time, you know, directly with them.

That's where I think I've been able to, offer practical solutions and help bring agriculture along. And I, I'm just pleased that, that, that they've been working collaboratively with our board. That's my sense from the agricultural community.

Maybe at times it's more difficult than others, but for the most part, I think they're, seeking sustainability as well.

Okay. Thank you. I really appreciate that answer. Thank you, Madam Chair.

Senator Reyes?

Thank you, madam PT. I do apologize. I was not able to meet. Our committee hearing went longer than expected, but it was a very important committee hearing as well. I, I want to go back to the issue that was brought up by our newest colleague, and that is safe and clean drinking water.

Something that should be a human right, especially here in California. I understand, as you said, that we're down to 800,000. When I came in in 2016 as an Assembly member, my colleague, Assembly member Eduardo Garcia, used to remind me we have a million people who don't have safe drinking water. And I could not believe it. 800,000 still is

a number that I cannot believe. Walk us through, if you would, what is the plan? Because if we consider safe drinking water a human right, how do we get from where we are now to the point where, just as my colleague asked, where people can all turn on the faucet and they have safe drinking water? What is the plan? Because I'm sure there is a plan.

Well, certainly, we have, as as I said, we have the, this annual needs assessment that we, that informs our decision making and then we have an annual process, with the funded, the fund expenditure plan. That's for the funds that the legislature has provided to us, the SAFER, program. And then, also, the source of funding that we have, from the, state revolving fund loan program and grant program for the drinking water program.

And what we do every year is we pull together the intended use, where those funds are going to go, the factors that we're considering, and that all is fed into our process because of the community engagement that we have received directly from the communities. So

Tell me the goal. I mean, is the goal, in one year, we should have 100,000 less. In two years, we should have 200,000 less because if we don't have a goal that we have nothing to aim for. And so that's really what I'm looking for is, again, I'm gonna the the same statement.

If safe drinking water is a human right that every Californian should have in the fourth largest economy, what is our plan to make sure that we keep chipping away at that so that eventually, I, I will never hear, you will never hear, because I'm sure you want to you want the same thing I want.

We all want it. We never want to hear of the hundreds of thousands of Californians that don't have safe, clean drinking water.

Right. I, I absolutely agree. I think that, the the challenge here in part, so I'm looking at some notes that I prepared coming in here, of the failing systems that we know of right now, 390 failing systems, that brings us to 811. We know that there are systems that are at risk, and so those systems are at at risk of failing for a number of reasons.

Senator Ochoa Bogh and I spent quite a bit of time yesterday talking about, the newer standards that we have for Chrome Six.

And so as those systems come in, it it's, it's not the same deadline for everyone. Larger systems have a deadline sooner than the smaller ones. And so, as the compliance dates apply to communities, if those communities don't have, a treatment that they can apply, then they are at right now, we are assuming that they're at risk, but they will eventually actually get added to the list. And so it's that challenge. I've been an environmental regulator for a long time.

We saw this at the Air Board as well, just as, basins come into compliance and then we, ratchet down because we have increasing information, regarding public health. So for these contaminants, we are actually required to review, our goals, you know, every so many years. And so, as we adopt new standards, now we have more systems that get added to the list. But the If you have priority

If you have 390 that you've already said are failing systems, and, and I because we don't get too many opportunities to have you before us, I do push back because this is so important. It is a human right to be able to drink clean, Clean clean, it's safe drinking water. I, I and even if there isn't an answer today, I encourage you because I know the question will come up because I know that in in my in my committee as a sub chair.

If you have 390 that you've already said are failing systems, and, and I because we don't get too many opportunities to have you before us, I do push back because this is so important. It is a human right to be able to drink clean, Clean clean, it's safe drinking water. I, I and even if there isn't an answer today, I encourage you because I know the question will come up because I know that in in my in my committee as a sub chair.

It's something that we are absolutely interested in. There has to be a plan to say we have three hundred ninety failing.

We have some that are at risk. Let's set that aside. We have 390 that are failing. So in one year, that should be down to three hundred. Next year, we should be down to 200.

Yes, there will be others that are added on, but this is this is such an important part of what I believe the water board needs to do. And for me to have heard in 2016 that we were a million, we had a million people who did not have safe clean drinking water and we're at 800. That that that doesn't make me feel good, as a legislator. I I feel that that we collectively isn't just you. It isn't just the board.

Collectively, we are failing 800,000 people in the state of California. So I would just encourage you and the board to really look at setting goals that are that are that are attainable, but that you're able to say you can say those 390 failing systems, we're gonna chop take off 50 every year. Whatever we have to do, we we have to get 50 off that list. Yes. Another 50 may come in, but at least you're able to say we got 50 off that list.

And I think having those types of goals are extremely important.

I appreciate that. And, I know that we have, numbers. I'm just not remembering what they are right now. So, I'd like to follow-up with you on that because I would like that. I'm just not good at remembering numbers at my age.

But I the reason I brought up is the the at risk is that it I I'm just wanting to be honest with you that even as we move that list down and we do have numbers that our staff has provided, and I'm just hesitant to give you the exact number because I don't wanna be incorrect. So I'll follow-up with you on that. But just wanting to be truthful with you about these additional systems that are at risk because of changing standards and also aging infrastructure.

So, you know, it's it's a big challenge and, I actually I agree with everything that you're saying, so I'll follow-up with you on that.

It reminds me of when we deal with the issue of homelessness. When you have someone that has is already unhoused, the issues are so much more serious. If you have those who are at risk of losing their housing, We have to do everything we can to keep them in their housing. It costs money to put to to keep them in housing, but it's better than having them unhoused because then everything it it it changes everything we have to do.

And I think it's the same thing here.

Taking some of those taking care of some of those that are at risk, but then also taking care of those that are failing systems. And now speaking directly to that, given the uncertainty of the state budget and the clean water funding cuts by the federal administration, I think the number I saw was going from 900,000,000 down to 100,000,000,000. It's substantial. From 976 mill million, decreasing it to a 150,000,000, by the current administration.

Given this, how is the state water board looking to fund clean drinking water infrastructure?

So, we are following, what's going on in this body as well as, federally, and all I can say is right now, we are not at risk, but in the future, we may be, and we're not in a position, you know, we're a fee based organization. We take whatever we get and we're happy to, you know, whether it's through, Prop four, the, bipartisan infrastructure program where we got some additional funding for PFOS, which was terrific.

We just take what whatever we get and we find that providing this information regarding our needs and the assessment, that it is helpful. But, we're not in a position to be able to, you know, advocate one way or the other at this point. We're, you know, just following what's going on. We're not at risk at this point.

Alright. And besides funding, what are the primary challenges in bringing a safe and affordable drinking water bringing safe and affordable drinking water to the remaining residents who do not have it? Those 800,000.

I I think it just gets back to, this program, is, focused on, communities and what the communities, want and desire, and so spending time initially to understand what the problem is, understand what their needs are, whether it's infrastructure needs, treatment needs, aging infrastructure, and then understanding the communities around them because of that potential for consolidation, which is, you you know, a definitely a a preference that we have, and then working with those communities.

And it can take a long time to get communities to the point that, this is something that they would want to do. We have those, authorities, the mandatory authorities that, we use that most of those systems end up, converting over to a consolidation on a voluntary basis.

And so, you know, just looking for, other, creative opportunities that we might have, like what I was talking about earlier, synergies with the sustainable groundwater management program, because there's well mitigation, drinking water mitigation that requires in in those, programs, and then also through the irrigated lands program. So being really strategic so that we can leverage investments.

I I want I I would like to now turn to, the letters of opposition that we received. The letters, deal primarily with, environmental groups. They deal with tribes who who have who have felt that they were not heard. What is your I I know that you've received copies of the opposition letters. Yes.

What is your response to these letters of opposition?

Well, my response is that, first of all, I do appreciate, the concerns that they've raised, in particular about, the development of the Bay Delta plan and the options that we have, under consideration. But my sense is that, they are, they continue to voice their opposition to the plan and it's morphed into opposition for my confirmation. Unfortunately, we, I I think that where we're going as a board is just not where they would like for us to go. So, this plan has been under development for years.

We've had many workshops and hearings on this plan, and the one thing that, my key takeaway is that we need to act.

It's the the Bay Delta plan is long overdue for an update and we do need to address the ecosystem and the watershed. We do need to provide additional flows for the fisheries, because the system is, you know, in in need for for us to recognize and deal with it.

However, this is a watershed that, 25,000,000 people in the state rely on and, the supplies are not terribly secure at certain times and so our job as a board is really to balance all beneficial uses and the approach that we are taking at this point is to have the, the flow approach that, the opposition is calling for, but it's more in the way of a backstop.

So, what we are positioned, when in our most recent draft is to have an alternative pathway called Healthy Rivers and Landscapes that provides for flow and also environmental restoration. I'm very excited about it because I think that it's, giving us an opportunity to do something that, we can't do as a board.

We only have our lever on flow. And this I've spent a lot of time in these watersheds and, they are crying out for restoration. And so, I'm excited about this opportunity. I do think that, you know, there are a number of these groups that I have worked with for years. I'll continue to work with them.

This is, just the beginning of the plan. Once we adopt them, we have to implement, and part of the implementation does involve getting, the involvement from many of the people that, many of the, the groups that have submitted letters in opposition. So, there's gonna be an opportunity for ongoing outreach and, Science Committee Adaptive Management and we really do, welcome their voices going forward.

I'm glad to hear that because I think that, whenever we do get letters of opposition, it is important to hear their voices. If we disagree, I think that the what I what I got was not so much that they don't like the plan. They don't like that they are being heard. And they felt that their their opinions, are being minimized. Their concerns are being minimized.

And I think that's the part that, as as leaders, it's our responsibility to be sure that we do hear them and that their opinions are are not minimized or at least that they don't feel that they're minimized. I'm not saying that you minimize their concerns. They feel that their concerns are being minimized. But I appreciate your response to that and with that, I would yield. Thank you, madam PT. Thank you.

Thank you, Senator.

Thank you. We're gonna go back to, Senator Ochoa Vogue for a quick question.

Yeah. Just, just really quickly. So a lot of concern about folks that are still don't have access to clean safe water.

Realistically speaking, can the legislature expect to get to a zero where every Californian has access to safe and clean water, or because or due to the fact that we have advanced technologies happening, and we're able to assess new new measurements of different elements, will we always be at a at a state where we're going to have folks that don't necessarily, what unquote, have access to clean and safe water?

Right. Yes, I think that that will be an ongoing challenge, but I think it's on us to make sure that we note that early on. That's part of our job as we, update any MCL, a maximum contaminant level, whether it's for chromium six, PFAS, arsenic, disinfectant byproducts. There are a number that we're looking at, you know, in order to protect we're a public health organization in that respect, and it's our duty to protect the public health.

So we will always see, more adding to the list, but if we are doing our job as we adopt those standards, we will our division of drinking water will be getting that information about these are the systems that with this new MCL that will comply, and then here's the list of those that won't won't, comply.

And then it's on us to determine how much time should we give them to comply, to determine what treatment technologies are available, how long will it take them to comply, what's the cost. And so that that's all part of we have an economic analysis, and I think we talked a bit about this yesterday on Chrome six, and we'll be going through the same thing for PFAS as we move forward with that, and then, you know, eventually arsenic.

So these are, you know, these are unfortunately, toxic substances and so we have to take it seriously but, it's along as we get information out there so that communities are prepared. As they also deal with aging infrastructure, which is anothere challenge to systems.

And then just a final thought on that. Would you say that technologies will continue to advance? We're going to be aware of more substances that are going to be endangering the ability to have access to clean and safe water depending on the standards and the science at the time.

There's a fallback on us as a legislature to ensure that the funding is there to help and assist these water agencies to be able to have the technology, the equipment to actually provide that clean access to water because we can have all the standards that we want. But unless we prioritize the funding for these programs, we're not going to be successful in ensuring that we attain a, you know, 100%, ability or or access to clean and safe water by Californians.

Well, of course, I agree. Funding is is crucial and anything we can do, whatever the pots of funding are, I'll just say that my drinking water system where I live, we are not in compliance because of a newer, contaminant that got added to the list, one, two, three, TCP. It's, as a result of, fertilizers that were applied in the San Joaquin Valley. So, on a very personal level, I understand what you're saying and I think that your residents, your constituents, they just want it fixed.

And it gets down to dollars and unfortunately, in these smaller communities where they don't have the rate base, it can be a challenge.

And and I'm just really proud to be a resident of California where we've made this a priority. I hear your frustration, but I also know we're the first state to declare the human right to water, and it's a top priority for us. And so I'm really proud of that. Do we have more to do? Absolutely.

Thank you. I wanna just, piggyback on some of what my colleagues have brought up. And there was a conversation about domestic wells. In places like the Cuyama Valley, which I represent, domestic wells fell long before the agricultural wells do. And, I I would like for you to speak on what concrete actions, you supported to ensure that drinking water users are protected before irrigating pumping continues.

Yeah. That's, so for the sustainable groundwater management act requirements, there are a number of factors, that have to be considered before you can say you're sustainable. So, overdraft, subsidence, saltwater intrusion. There's a whole list. And so, what our what our board has done, actually, I'll back up a bit.

The Department of Water Resources has been just terrific, in working through this program. So, they provide the they have provided technical assistance grants to the local, districts, the Groundwater Sustainability Agencies, and in order to get those funds, they have to be looking at all of these issues, including the draw down that can affect domestic wells. And so our role has come in a little bit later in the process because we're the the backstop, so to speak.

So we only received, groundwater, sustainability plans, you know, coming from basins that didn't get the green light from the Department of Water Resources. So the information that I have is much more specific to the basins that we received, which is in the San Joaquin value.

And I can tell you that for what we've done, we have been absolutely committed. No plan is gonna get through if it doesn't have a domestic well mitigation program. And so that's just absolute and and these wells are much more shallow and so, of course, you know, they can fail for a number of reasons, you know, ongoing drought, agricultural over pumping, and failure of systems.

And so what these, plans have is a process where as far as what what we wanna see is if a well fails, to make sure that they get a replacement water supply immediately, so that nobody's without water.

And then it goes through a process where they've brought in technical assistance providers, typically like, self help enterprises, to come in and, help evaluate what the situation is, why did the well fail, and if it's due to the over pumping, then the Groundwater Sustainability Agency has to pay for it.

So then, on that note, so I'm hearing you say, that you think or what what I'm hearing what I think I'm hearing you say is that GSA should be required to fund the mitigation? Yes. Okay. For domestic wells, even if there is a constraint to agricultural pumping?

Yes. Okay. Yeah. Because that's yeah. Not sustainable.

Right.

Thank you. Now, while some of this, is not necessarily your doing, per se, it is you know, we talked about what happens and the function of when these things cannot be resolved, they at times, you know, go to adjudication. And so I'm wondering if you could just speak to where Sigma has worked and where it hasn't worked.

Because there, of course, all throughout our state, there are areas where we have some serious concerns in terms of not being actually able to resolve some of these issues, not meet some of the goals that Sigma had. And in the very communities at times where Sigma is supposed to be helping, it feels like it's become a little bit of an obstacle to actually, you know, ensure that there is fairness and equity in how water pumping happens.

Sometimes at the expense of small rural, working class communities that ask themselves this was never supposed to be this way. We were supposed to create a system where fair pumping occurs. And now, the system that exists, has resulted in an expense that is so high through the adjudication process, that they're asking themselves, is this really working for California? Can you react to that?

Yeah. I can a little bit. So it it it kind of back to what you were the the first question that you were asking about, you know, who who pays for it. I'm I'm referring to what our requirements are because these basins have come to us. So it's a limited number because we're the backstop.

They come to us because they haven't been able to show a plan of sustainability. What you're bringing up, I think, is that some of these plans, you know, if you go back and look at, what the legislation says, it is very clear. The best management is local management. What what we're doing as a state is stepping in if they are not able to show a path of sustainability. It doesn't mean that everything's gonna be just perfect.

It doesn't mean that everything's gonna be fair and that local entities are all gonna fully embrace a plan. And so what we've seen in the limited plans that we've been involved in, you know, sometimes there's finger pointing, like, one part of the basin says it's the other guy's fault, and or that their information that they're relying on, it's it's not technically accurate.

And so, again, just focusing on the few basins that we deal with, we have to sort through and determine what whether or not an updated plan, brings them into sustainability. If not, we will step in and we will actually create a plan. We're gonna hear the same thing when we create a plan.

Yeah. That, you know, it's not fair. This other this other area, you know, they have, more ground water rights than, than another. And could that trigger an adjudication? Yes.

That's possible. We wanna avoid that, And so I think that's why we're out there in the communities working with them to try to make them understand that's not gonna be in their best interest. Let's figure out a way to work this out.

So in overdrafted, base in communities like Cuyama, what specific triggers what specific qualities triggers create a probationary status? What does that look like? And what need what it needs to look? If you know that there are already overdraft communities, where do you come in? Right?

Because it's local control, but you're the backstop for this local control. And at what point do you override what is happening locally because it's just not working in overdrafted basins?

Yes. So we only, get involved when, we've been doing outreach all along, but we only get involved in specific basins where the Department of Water Resources has determined that the plan does not meet a sustainability standard. And they've, provided lots of guidelines, for the groundwater sustainability agencies. We only received seven plans and we did not receive Cuyama. So, I'm not able to speak directly to it.

I I would welcome the opportunity to look into it a little bit more, but I actually think it'd probably be in conversations with the Department of Water Resources. But I'll check with my staff, with our staff on that.

Cuyama is are done. The Cuyama Valley is unique in that it's four counties. Santa Barbara, Ventura, San Luis Obispo, and Kern County that share the Cuyama Valley. And so, center layered also. There there actually, there would have been three of us that would have had a touch point to Cuyama Valley if we had one more member here.

Yes. So when I went to the Cuyama Valley once, I had to spend two miles in Kern County on my way there. And I texted Senator Grover who thought I was coming to campaign against let me ask the the Pro Tems question a slightly different way and and it's a Cuayama example, but it's really it could come up in all seven of those plans. And I keep thinking after fifty years I know water and I learn new things.

And in that particular situation, there's two big growers that use 70% of the water in the valley and are not known for water conservation. And there's a small farmers that use one acre foot or five acre feet a year and they conserve dramatically and then they go into either adjudication or sigma and the baseline is their use. And so the people that conserved are penalized and the people that that don't conserve are rewarded. And and I guess the question might be, is there any way you can get at that issue in what you do?

I think that's part of where we were going and I know that you're gonna tell us that we set the laws that don't want you to do that and and would we please change the law. But if there's any other way you think you could get at that, could you please comment?

Well, I we're we're actually down to two basins. So of the seven, we returned five to the Department of Water Resources because, they understood that we would be developing the plan if they didn't. So, for the other five, they figured it out and we said, okay, see, back to DWR. So now, with the two remaining, I think we're gonna see similar issues there.

There are gonna be folks that have that are gonna say they've already conserved and they should get a credit or we're hearing all kinds of interesting things like, you should get credit for precipitation that has not yet occurred, or you get credit for precipitation and you can transfer it to some place else.

So there's just gonna be a lot that we're gonna have to sort through. I I can't sit here and, pretend to know all the different ways that this could play out. But I think for the basins that we get, it's our job to understand those dynamics that are going on the over there mostly because we it it's a race to see who submits the plan that meets sustainability.

So we're gonna move forward with an interim plan in these situations where we get the basin, but we're encouraging them to develop their own plan. And as they develop their own plan, they're gonna have the same challenge that we are.

Some are gonna view it as being inequitable, unfair because of their overlying ground water rights that they have a right to and it may trigger an adjudication.

I think that what you're hearing from us is that we would really hope you would take that into consideration and have that situational awareness. And that if you don't think you have the tools to deal with it, the board will reflect that to us in case we can give you the tools to deal with it. I think that's just what we're trying to say. But thank you. I appreciate your response.

Thank you. And and it is you know, what's happened in the Cuyama Valley, is something that we're hearing, is happening in other communities. Adjudication is happening in other places as well. And we are hearing these patterns of wait. The folks that are trying to do the right thing that have actually, in a lot of cases, significantly less resources.

They're finding that this is not working for them because they are the ones, that are the most disproportionately impacted. I feel like, equity is not something that is a product of what we are witnessing. And I know it is intended to be. I know that that is the goal. But when you are on the ground in these communities and you are watching how this is playing out, it doesn't feel equitable.

And we're trying to understand what laws or tools could help. And we also I think to to Senator Laird's point, we wanna make sure that there's an awareness. This is not the only place in this state where this is happening. It's not the only place where the smaller farmers, the smaller communities are not able to keep up. And we can talk about how you get people, you know, on some of these boards.

You know, I mean, this is this is harder. So I I hope that this will not be a conversation that stops here, but that continues to really look at how we help all of our communities think about access to water.

And I feel like that's been a theme here. Everybody wants access to water. We feel like it is a right, and and we dig a little deeper to understand. There are places in our state that don't have access to clean water, and there are places in our state where we're watching that access be really threatened by who has more access under what circumstances and conditions and who gets left out.

Yeah. Thank you for that. Could I just, respond? I I don't think that this is going to, address fully your concern. But just to let you know where, where we have weighed in on the equity, piece for Sigma.

So first of all, if we look at the criteria, you know, it's all it's all hydrologically related and, you know, we we get reports and we can figure out whether or not there's subsidence, whether or not there's saltwater intrusion. You know, it's it's, information that we would get and that weighs in on our decision about whether or not there's a plan that meets sustainability.

But on the, the the issue of equity, I can just speak to what we've done most recently, and that is we are moving forward on two of these basins, and we have been down in those communities several times. We have language interpretation services and we have made it very clear that we want to see these plans develop locally, but they have to have an open public process and they can't shut people out.

And so, we have seen things that don't look great as far as, you know, meetings that occur and, then we'll later on hear from, environmental justice or drinking water organizations that they feel that they've been shut out.

But I do see an improvement in those areas. And also, the plans that we've sent back to the Department of Water Resources, we did end up hearing from a lot of the clean water advocates that and drinking water advocates that the plans took into account the concerns that they raised. So, this is an area that's important to us and we will continue to, manage it that way. And then on fees, we are going to be imposing fees for the first time on pumping.

So $300 per well and then also, so I think it's $20 an acre foot for pumping.

We have exempted small farms that are pumping under 20 acre feet, I believe, and we determined that that was the right thing to do because, first of all, there's, language barriers for many of these small farms, and then also, it's such a small it might be one to 2% by volume in the basin. And so, really, we wanna focus on, you know, where where the problems lie, as far as, our main focus. We are a fee based organization.

We have to recoup our costs, but, we think that that's an appropriate adjustment, that we've made.

Thank you. Thank you. I appreciate that, and I look forward to seeing how that rolls out, in in our state. So with that, this is the time that we're going to welcome members of the public to come forward. We're going to start with members of the public who are here to speak and support.

The first two individuals will have two minutes each, and then it will be just name, affiliation, and position only. And we will do the same for opposition. Alright. You're welcome to come forward.

Thank well, thank you. Thank you for the opportunity to speak, committee. Good afternoon. My name is Eddie Ocampo. I'm the, Public First Director for Self Help Enterprises, the technical assistant provider that Doreen D'Adamo just mentioned during her testimony.

We work closely with communities across the San Joaquin Valley on water and wastewater, community development and affordable housing issues, and also on providing technical assistance to many of the communities in our nine county service area. Wanted to share our very strong support for Didi Adama who stands out to us on how practical and collaborative she is with the different agencies that we work with and the different organizations that we work with. The water space is a very complicated space as we're all aware of.

We need connector people. We need people that be able to build consensus.

Didi has been building consensus with amongst a very diverse set of individuals and interests across California and particularly the San Joaquin Valley for our organization, organizations like us. And I really want to stress how important that consensus building process is in this water space that we operate in. We regularly reach out to people on the ag side. I'm talking about self help enterprises.

We regularly reach out to people on our community side who we represent and who we work alongside with to make sure that they're included in these processes.

It's important to have folks who understand how difficult that relationship building is and who actually take that on as a challenge to help improve those communications. And I think Didi has done that for us and for many organizations in our space, and I strongly support her reappointment. Thank you.

Thank thank you. Next.

Robert Gore from the Guoco Group here today on behalf of the San Bernardino Valley Municipal Water District, in in enthusiastic support of vice chair, D'Adamo. A Senate staff member recently said to me, water, it's a complex beast. Well, who better to tame the beast, than someone with a proven breadth, depth, and and diversity of of integrity and experience to work for all 40,000,000 California water users. We're in, again, in in enthusiastic support.

And I would urge the Senate, in response to some of the questions, to perhaps consider restoring the $30,000,000, that's safer lost in the in the realignment. That would immediately, address, drinking water issues. Thank you.

Good afternoon. Oops. I'm sorry about that.

Thank you. Thank you. And just a reminder, those were the first two that had some time to speak. Now it's just name, position, and affiliation.

Emily Rooney, president of Agricultural Council of California. Also fifth generation resident of San Joaquin County and former member of the SAFER advisory committee in strong support of Dede Adama. Thank you.

Thank you.

Good afternoon. Alex Biering from California Farm Bureau in, strong and enthusiastic support of our friend, Dee. Good afternoon.

Noel Kramer with Wine Institute, also in strong support of vice chair D'Adamo.

Hello, madam pro tem and members. I was asked to express support on behalf of a few people. One is the San Luis and Delta Mendota Water Authority, Scott Peterson, who's the water policy director there, Kenan Michael of Bulls Forming, Farming, who is the chair, United Water Conservation District in Ventura County, and then also on behalf of myself, I have worked with Didi Diadamo for decades in our very respective roles. She is a listener, and she really tries to facilitate solutions for all people, strongly in support.

Good afternoon, madam pro tem and senators. Joshua Golka with the Santa Clara Valley Water District also in support. Good afternoon, chair and members. Brenda Bass with KP Public Affairs here on behalf of Western Growers in support. Thank you.

Sarge Green, Association of California Water Agencies executive committee member, Fresno Metropolitan Flood Control, and the Tule Basin Land and Water Conservation Trust, which is dealing with the retired land in the probation areas that that Doreen is working on. Well, the state board, I support.

Thank you. Good afternoon. Jamie Minor on behalf of a few entities including the California Stormwater Quality Association, Monterey One Water, Eastern Municipal Water District, and Santa Margarita Water District in strong support. Thank you so much. Thank you.

Michael Belote, California Association of Wine Grape Growers. We enthusiastically support this confirmation. Thank you.

Good afternoon. Aaron Sassy with the Elsinore Valley Municipal Water District here in support. Thank you.

Good afternoon. Mark Smith on behalf of the Grassland Water District, Patterson Irrigation District, the California Waterfowl Association, and Ducks Unlimited in support. Thank you.

Good afternoon. Josh Weimer with the Turlock Irrigation District in strong support of our neighbor from Turlock. Good afternoon. Caitlin Leventhal with California State Association of Counties in support of this confirmation. Thank you.

Good afternoon. Tim Carmichael with the California Council for Environmental and Economic Balance in strong support.

Good afternoon. Danielle Coats, Rancho California Water District serving the Temecula Valley in very strong support.

Good afternoon. Kyle Jones representing the San Joaquin Valley Water Collaborative Action Program and also ask to express support on behalf of Clean Water Action. Thank you.

Thank you.

Good afternoon. Chris Anderson on behalf of the California Chamber of Commerce in strong support. Also been asked to register the support of Irvine Ranch Water District. Thank you.

Thank you.

Good afternoon. Jason Eichard on behalf of the California Municipal Utilities Association. Very happy to be here and support today.

Thank you.

Good afternoon. Beth Olhasso on behalf of Inland Empire Utilities Agency and Water Reuse California in strong support. Thank you. Thank you.

Kasia Hunt with political solutions here on behalf of the California Water Association in support.

Thank you.

Tia Fleming, executive director of the California Water Efficiency Partnership in strong support.

Thank you.

James Pfeiffer, executive director of the Regional Water Authority in strong support.

Amy Tullo with the Regional Water Authority speaking on behalf of the Association of California Water Agencies.

Thank you.

Good afternoon. David Guy, Northern California Water, strongly supporting Dede D'adamo.

Thank you.

Good afternoon. Dennis Albiani with California Advocates on behalf of the Pacific Egg and Poultry Association, California Pear Growers, California Seed Growers, California Grain and Feed, and several other agricultural organizations in support of miss D'Adamo.

Thank you.

George Cavinta on behalf of the Almond Alliance in support of this confirmation.

Thank you. Do we have one more in support? No. Okay. Alright.

Seeing no one else in support, we will welcome anyone in opposition. The opposition does have two minutes each to give remarks if you would like.

Thank you. Good afternoon, Pro Tem Lamone and committee members. My name is Max Gomberg. I'm here today on behalf of the Delta Tribal Environmental Coalition, and I'm also gonna speak from personal experience. In 2010, I was working for the Public Utilities Commission when eight people, including one of my coworkers and her 13 year old daughter, were killed by a gas line explosion, caused by PG and E's negligence.

In the aftermath of that tragedy, it was revealed that the PUC president had been having inappropriate communications with PG and E. He was forced to leave, and the legislature took steps to reign in the PG and PUC's overly cozy relationship with regulated utilities. Over the past several decades, a separate tragedy has been unfolding in our river, aided by another state agency with an overly cozy relationship with regulated industry. The State Water Board has consistently tipped the scales on behalf of agriculture and urban water interests.

And as a result, we have multiple species headed towards extinction.

We have toxic algal blooms choking our waterways and environmental justice communities like Stockton. Tribes are unable to perform safe cultural practices. Now I worked for the State Water Board for ten years, from 2012 to 2022, and I was proud to be part of many important initiatives during that time, including those that were just discussed, like safe drinking water, climate change, conservation.

But those accomplishments do not excuse or justify the board's unwillingness to take on its most important duty, which is protecting the environment, and which it has not done in our most important estuary which is the Sacramento San Joaquin Delta. Vice Chair D'Adamo during her thirteen year tenure on this board has been a vocal supporter of agriculture.

She has worked internally to weaken climate and racial justice commitments related to water rights, and she has publicly expressed opposition to proposals that would mandate more flows in our rivers to protect the environment. This committee should not condone the ongoing environmental catastrophe in our delta via regulatory capture of this board. Urge your no vote. Thank you.

Thank you.

Thank you, Chair Limon and members of the committee. My name is Gary Bauker. I'm the program director at Friends of the River. I'm not here to make any statements negative about Didi. Sorry, miss D'adamo.

Or suggest that she hasn't performed positive accomplishments in her life. I'm here to oppose her reappoint simply because more more because what she hasn't done than what she has done. One of the board's biggest challenges is the ecological and water quality crisis that's affecting California's great signature aqua aquatic ecosystem, San Francisco Bay, the San Joaquin, Sacramento Delta, and the rivers of the Central Valley. And we are seeing waves of extinction coming. We are seeing more severe, more frequent, longer lasting, toxic events.

We are seeing devastating impacts on communities that depend on fishing for subsistence, for commerce, or for cultural resources. This is one of the big crisis of California. Unfortunately, miss D'Adamo, in her tenure on the board, she was the only vote against improving protections for the Bay Delta back in 2018, protections which, by the way, the board has yet to implement eight years later. And she's been a voice really against, timely and effective action to address the problems that we really know are there.

Now I am not suggesting that miss D'Adamo or any other board member is acceptable only if they agree with exactly what I think the solutions are.

But I do want Board Members who are outraged about this crisis in the Bay Delta and the way it affects many communities and who push timely and effective action to address the root causes while looking at the impacts to all users. We don't have that now. We desperately need it. Instead, what

we're looking at is the board is poised to make a decision which will essentially take what regulated community is willing to do instead of the action that we need to know to avoid multiple extinctions of species, the loss of important legacies to the communities I mentioned, and increasing toxic water quality events. Miss Diadamo has had thirteen years to deal with that. I I just think it's time for a change.

I think there are big responsibilities that the board has that that it needs new leadership, and new membership to, to address those problems. So with all due respect, I oppose the renomination.

Thank you. Alright. Please just state your name, your affiliation, and position. Thank you.

Thank you.

Cynthia Cortez with Restore the Delta in opposition.

Christy Ralston with San Francisco Baykeeper in opposition.

Thank you.

Van Staplin, executive director of Golden State Salmon Association in opposition.

Thank you.

Natalie Brown on behalf of the Resource Renewal Institute and Defenders of Wildlife in opposition. Thank you.

Molly Colton on behalf of Sierra Club California in opposition.

Thank you. Alright. With that, we will conclude public comment. We're gonna bring it back, to the, dais. Senator Reyes.

I I know that I asked earlier about your response to the letters of opposition. I do want to give you an opportunity to respond. And sometimes the response isn't I disagree or or we just don't agree on the the the the what the plan should be. But figuring out how we work with those who oppose where we're headed to take a pause and see what it is that we can do to be inclusive, equitable in our decisions. So I would like to give you that opportunity.

Thank you for that. I appreciate it. So, I think I'd like to go back to 2018, when I voted no for the, basin plan amendment for the San Joaquin that, has a provision that's similar to what the opposition is calling for now, and that is unimpaired flow. So, remember when I was saying earlier that we only have one knob and to turn, and that's flow, and that's what we did as a board, in 2018 for the San Joaquin Valley.

And so this would be for the, Stanislaus, Tuolumne, and Merced Rivers that we adopted.

I voted no because I was very concerned about the water supply impacts that it would have on urban and other users agriculture and industrial uses as well and thinking that there was another approach that we could take. And, right when, we had that vote in 2018, it was right as governor Brown was outgoing and governor Newsom coming into office.

They sent our board a letter and asked for some additional time before we voted on that because they wanted to have an opportunity to see if there was an alternative compliance path that might, provide benefits to the fishery, but at a lesser water cost. And I was very much in supportive of that approach.

And so when our board adopted the resolution, it included a provision, directing our staff to work directly with the entities that had come forth with a sort of a framework back then in 2018.

It didn't have enough meat on the bone, so it didn't it wasn't fully vetted, hadn't been analyzed in any level of detail. And so, in 2018, that process, began but it wasn't our process. It was actually, when governor Newsom came in, he directed the secretary of the natural resources agency and EPA to work with, public water suppliers and environmental groups. That was not our process. We needed to stay out of the process because we're the decision makers.

And so, it wouldn't have been right for us to be in there developing something, you know, like that with the regulated community. It's my understanding that tribal interests were not invited into that process. I think of the, again, I wasn't involved in that process, but from what I understand, looking back, they should have included an invitation to tribal communities.

Once the once the, program was further developed into something that we could actually analyze, we received it in 2023, That's when our process began and I have full confidence that we had a very full public process at that point. We, outreach to tribes, the environmental organizations, those that are here and others, not, And had a number of hearings and workshops.

We, sought tribal consultation on three separate occasions. And I think that we learned a lot in that process. And there were a number of, criticisms, that were raised that we've incorporated into our decision making. One of the things that we did do is we took more time so that we could analyze and include, tribal beneficial uses for cultural practices.

So, I and and then others other concerns that were raised, looking for more accountability on this healthy rivers and landscapes proposal, strong enforcement provisions and a strong backstop.

That backstop mirrors what we had in the 2018 plan for the San Joaquin. So it's included in there. We've got some components of what they're seeking, but it's not the proposal that they prefer. I'm, again, just, excited about going forward because we need to implement. It's time to get some of that, you know, additional flow restoration projects and improved outreach and bringing these groups into the process because the way the governance is, portion of the, program is structured, it includes a wide variety of interests.

And so, I'm hoping that some of the groups that were here today or others in the environmental community, tribal community, that we can include them, in that process going forward.

Are you committed to including them then in this decision making process?

Oh, in the in our decision going forward? Well, we we are yes. Yes. Absolutely.

Yes. Clearly, you have lots of support also. And we don't want to minimize the the great support that those who have come to speak. But I always want to emphasize that if we have those who are feeling that they are left out, that it is an inequitable process that it's something to to to look at. I I I don't have a problem voting to to have you confirmed.

I but I do have final question. Should there be term limits? We all have term limits. Twelve years. Should there be term limits?

That's a good question. Yeah. I've been on the board for a long time. This is thirteen years and, you know, really thought long and hard about whether or not it was time to step aside. I have grandchildren.

I wanna spend more time with them. Want to, you know, maybe take care of my health a little bit more, but, I've invested so much time in this, and, we have some big decisions that are before us, and so I felt that it was important to be here through the end of that. And then with implementation, you know, it'll take several years. It'll be time to move on and have somebody else in this seat.

But at this time, I think that it was just it felt like, you know, leaving before the delivery, so to speak.

So felt that it was important to stay on. And also, I just we we we have a terrific board. We collaborate so well together. And in this time in our country where, you know, it's very divisive, I just really enjoy. Our chair's wonderful and the vice chair work closely with him and everybody and, I I think that it has produced really good results.

Some of the things we talked about earlier, you know, drinking water, sigma, etcetera.

Thank you so much. Thank you, Senator Laird.

Thank you. I appreciate the exchange there and I think one of the things just as hard as it is to believe this is an abbreviated hearing in some ways and and one of the things we didn't talk about was the Bay Delta plan and it is treacherous to get into the issues of the Bay Delta.

But I feel obligated having witnessed the beginning of that process to comment briefly and frame what you were just asked because the water board has the authority to regulate and move ahead on the Bay Delta. Authority to regulate and move ahead on the Bay Delta. And the decision was made by two administrations to try to get voluntary agreements and try to leverage the threat of the regulation to bring people to agree in a way that they might not agree without that kind of pressure.

And, unfortunately, this has gone on for a decade, and there has been no ultimate final decision. And I think part of in addition to the inclusion issues, part of what you were hearing was the frustration in the lack of getting to the end, particularly from some people, salmon industry and others that believe enforcing a strong regulatory response is the right place to go to protect these issues. And I think, unfortunately, and I would like to see a decision finally made.

I think in many ways because part of it is the administration and not the water board that that is one of the reasons that it has taken so long and that's one of the reasons that you haven't had the complete political or administrative ability to go ahead. And I think in many ways what has happened is you are being blamed for the entire water board and the entire fact that that decision has not been made.

And and I think the frustration is palpable and the frustration is correct. It it should be getting there. The clock is ticking. Climate is changing. But I don't think it's because of your work that this is delayed or this has not happened.

And the other thing I was going to say just in general was I am sure I would be happy if all five Board Members were from Marin and Santa Cruz and agreed with me on everything. We would have the best water policy I think that we could have except there just happened to be 40,000,000 people in the state and they just happened to be all over with different interests.

And I honestly believe there's tremendous value to having somebody that is trusted by the agricultural community and that trust is used to occasionally tell them that they can't have what they want and you might be the only person that has them walk away and believe it or walk away and understand that's the case.

And so I think that is a valuable role and I I watched when I was on the college board the fact that there was a former head of the classified employers union, there was a city attorney, there was a contractor, there was me, there was this incredible diversity that in the way we didn't have split votes and we brought the whole community in. I think that is a valuable role for boards and I think that is what is happening here.

So as much as I might occasionally wish that these decisions were made quicker or they were a 100% environmental, I think there is value to that diversity. And so if it is the appropriate time, I would move that we advance this appointment to the floor.

Thank you, Senator Laird. And I'm going to, before taking your motion, also echo, I think, what's been said by my colleagues. And in my time in the legislature, you know, I'll speak to to, the Delta. This has been an ongoing issue, And so this issue precedes all of us as legislators and may also still be there once we are termed out.

But but I do think that one of the pieces and recognizing that we have no one on this dais in this moment that is from the region.

You talked about bringing diverse, you know, voices. And you also talked about this moment in time where things feel divided. Just not here today. Just the the world feels divided. And I think that this is this issue water issues are very much from my perspective have been issues that feel more pronounced from the depending on the region you're from.

And your position tends to be oftentimes, influenced. I actually don't fully see it as partisan. I feel like your region will tend to influence more how you feel. And I say that because I don't I I think an acceptance that we just have differing of opinions, and it stops there, is really hard on an issue that is this big, where it is ongoing. It doesn't end.

We've been at this for decades trying to determine what may or may not happen. But certainly, I really appreciate your very clear answer to say yes. They will be included in your deliberative process. I I think that that's important. And and I wanna emphasize just how important it is to us too.

You are, you know, part of, the the state water board. You have a different role to play, but I I hope that you hear that from the legislature's perspective, including, the diverse voices, is important for us too. And I'm appreciate that you also said it's important for you. So Thank you. Thank you.

With that, I will go ahead and accept the motion that we have on the table, by Senator Laird.

[Roll Call]

The appointment has been approved to move to the full Senate for confirmation with the four zero vote. Congratulations. Thank you. As we transition We are going to recess for five minutes.

The appointment has been approved to move to the full Senate for confirmation with the four zero vote. Congratulations. Thank you. As we transition We are going to recess for five minutes.

Convene again.

Thank you everyone, for your patience. We are now going to reconvene, our committee. We will, go, to our governor's appointees required to appear item one b, the appointment of Siva Gunda as a member of the California Energy, Commission. Mister Gunda, you are welcome to come forward. You will have the opportunity to provide one to two minutes for your opening testimony to this committee.

And in your opening, you're welcome to make any introductions of your guests. I see you might have a special one here today. And we will keep a tab of your time and prompt you when it, when your time has concluded.

Thank you, chair. I would like to introduce, my wife, Courtney, and, daughter, Nora, here. Thank you. So, you know, it is a genuine, honor to appear, before you today. I began this role in February 2021 during COVID and just months after the 2020 rotating outages.

Since then, thanks to the collective work of the state agencies, the legislature, the governor, his team, utilities and countless stakeholders across California and the West, we have not had a flex alert over the last three years. The grid is now over sixty five percent zero carbon. Petroleum demand peaked in 2017 and has been declining. Building electrification is beginning to bend the demand curve for natural gas. These are critical steps towards achieving our climate goals, and I'm proud to have been a part of the collective effort.

But California is at an inflection point. We are managing not only one, but three energy transitions simultaneously, decarbonizing the grid, electrifying transportation and buildings and responsibly winding down petroleum and natural gas systems. California's transition is part of a larger regional and global shift. The grid we depend on spans the entire West and our fuel supply is tied to the forces beyond our borders. California cannot navigate these transitions alone, It requires coordination with local, regional and federal partners.

And it will involve carefully considering trade offs for communities, workers, consumers and rate payers. The only way to navigate these trade offs well is with transparency, rigorous analysis and trust across all parties involved. That commitment will guide by second term. If it moved forward, strengthening the planning methods we use, including how we measure impacts on public health, workers and communities, advancing Western energy markets that deliver real reliability and affordability for California ratepayers and guiding the petroleum transition with the seriousness it deserves.

In all of this, with honesty about the trade offs and the opportunities, so that this legislature and the public can make informed decisions.

I'm deeply grateful for the partnerships across the energy community and for the extraordinary team in our office and in the energy commission who work tirelessly every day. I would not be here without my family, my wife and children, my in laws, who live nearby and help our family every day, and my parents, my mother, and my father who passed away recently. His greatest wish for me was simply to be a public servant, and I carry that with me today. Thank you. I'll take your questions.

Thank you. Members, questions or comments? We'll start with Senator Rosalie Ochoa Bogh

You know, it's a mouthful. So let me begin, on behalf of Senator Grove, as she is not able to be here today. Senator Grove has been speaking with mister Gunda about this issue, and so he's aware. And so I will be asking the following question. Mister Vice Chair Ganda, Senator Grove has asked me to thank you for your strong and active support for Kern Energy.

She greatly appreciates your efforts to assist California's last small refinery and the only refinery in the San Joaquin Valley that produces transportation fuels. That said, there are deep concerns that the disproportionate compliance burdens on this small refinery are now threatening Kearns Energy's long term viability. The San Joaquin Valley and California as a whole cannot afford to lose another refinery. As a governor's point person on transportation fuels, what specific actions is your office taking right now to recognize Kern Energy's unique role and ensure it remains operational?

Thank you, Senator. Just wanted to recognize, the incredible partnership we've been having, with current energy. And I also wanna recognize the unique situation they're in, both in terms of being landlocked, both for the access for crude, but also the scale at which they operate. Many of the fixed costs that large refineries can scale cannot be easily scaled for current energy and smaller refineries.

So as a part of, the special session, the second special session that we had, the Energy Commission advocated for requiring the exemption of small refineries.

So, they are not necessarily be a part of the compliance for SBX12. And through the development of the resupply analysis and the guidelines, the Energy Commission has exempted or indicated potential exemption for current energy and the small scale that they are. In terms of, the broader compliance clause that, you know, an entity like current energy has, that is under the jurisdiction of a sister agency, CARB, and we actively work with them on sharing information that we have and will continue to do so.

Okay. Perfect. And just as a suggestion, Senator Grove also wanted to just state that if there are any other details that you would like to add that you may not have available today that you could, actually provide a more responsive follow-up letter to the committee on that end.

That's what we will do.

So that said, that's on behalf of Senator Grove. Now on my end, we discussed briefly in my office, and thank you for meeting with me prior to the hearing, where we are in respect to the high fuel cost in California and where we are as far as the transition to alternative fuels. So I understand, just learned yesterday actually after a meeting that the draft for the California Transportation Fleet Rules Plan was just released on May 1, sixteen months after the legislature had requested this report.

Since the report is very new, would you mind actually, just elaborating a little bit on what it says? And, most importantly, does it give us a road map, to address the current fuel crisis?

And what is our transition plan to alternative transportation fuels that doesn't make Californian more expensive to live in? Yeah.

Thank you, Senator, for that question. Just thinking through two specific reports that were released, both the transition plan, which was led by CARB that you just mentioned, which CEC was a part of, as well as the CEC's, SB 237 report. Both of them largely, provide a menu of options, for navigating, towards our clean energy goals, especially the transportation, transition that we have to go through.

It includes broad categories and the main categories are looking at fuel options, whether it's ethanol, whether it's regional blends, opportunities for alternate blends that ultimately could make the overall supply situation more competitive. Second, it recognizes the importance that this transition is Harabedian.

And as the transition happens, there'll be a number of burden stakeholders that includes workers, that includes communities, who host these refineries today, from an environmental liability standpoint, as as well as cities that might have fiscal issues as we transition. So the the broadly, it recognizes the importance of continuing to work towards how to support this transition for those stakeholders. And finally, it also recognizes the importance on doubling down on our demand strategies.

So it looks at both reduction of VMT overall at the vehicle mail's traveled by improving transit and other opportunities. It also recognizes the opportunity for improving EVs and alternate technologies that are clean for the future.

Okay. Is there anything else that should have been added to the report that is not included that in your opinion should have been considered?

Senator, I think one of the points that we are at right now is many of the agencies have very clear statutory lanes in working. And I think as with the previous discussion and many of the oversight hearings that we are currently having, I think one of the most important things right now is how do we think about this as a holistic industrial transition moving away from not just an energy or a climate, but more holistically.

So I think it'll it'll require a back and forth conversation with the legislature and the agencies on how best to go from point a to point b.

Okay. And then,

I'm trying to think whether or not I address this question or should I let Senator Laird lead the way. He takes it. He takes it. I was gonna say, I I did wanna talk a little bit about the role that Diablo Canyon plays in ensuring that the state has a clean, reliable electricity supply. So I was debating on that, but I I'm sure that

She's messing with my district.

Thank you, Senator

But to be fair, as a vice chair of energy, it falls within my realm of purview to actually want to address this.

Thank you, Senator for that question. I think the, specific to any technology, I wanna just first, begin the conversation with just how we plan. So when when we're thinking about future electrification load in California and the amount of generation that we add, what the guidance we have from the legislature today is plan for the future of the grid as if Diablo is going to retire at the 2030. So that's how the CPUC, the Energy Commission, CAISO, CARB are all planning.

So as we move forward, I think it's a policy question between the four stated goals that we have in the state.

It's clean, reliable, affordable, and equitable. There is analysis, from the the CPUC, that they put out last year that does show opportunity for having affordability and rate positively impact the rate payers under certain conditions. So I think from a pure reliability and structural planning, you know, we have not been using Diablo as a resource. So I think it comes down to a conversation on how the state wanna move forward in terms of, specific technologies and assets.

So the legislature needs to take the initiative on on the approach on that end? Yep. Okay. Wanted to have that. So let me ask you moving forward in your professional opinion.

Do you think that the state will be prepared to retire Diablo Canyon by 2030 without compromise and real reliability, particularly given that the CEC has recently projected that the electricity demand will increase by 50% by 2045? And if not, what are the consequences of the state continuing to include a 2030 retirement date in statute, and how are we planning for that loss of power?

Yeah. Absolutely, Senator. I think, as of today, if we continue to build at the rate we are building and the way we are planning is obviously to include the retirement of Diablo Canyon, we would not see any reliability issues either just by retiring Diablo because the idea is to plan as if we are retiring Diablo.

It's always great to have every electron you have access to, but at the same time, the Western markets are expanding, and there is more opportunity for us to bring, electrons from the broader West into California and also export our excess solar. So I think overall, the current planning, does not take into account the need for Diablo.

And I think we'll, again, it goes back to the previous, conversation on, is it, you know, a good policy? I think has a lot of trade offs that we need to think through. Okay.

Thank you, sir. And then, I'm going to, continue on the, in your opinion, how do you see a near California energy future working functionally, say, by 2032, where California only imports fuels because California refineries were pushed out due to regulatory force? And with only importing fuel, California will see severe strains in reliable clean burning fuels refined by considerably less clean foreign refineries, costing consumers massively at the pump due to increased shipping cost.

Thank you, Senator, for the question. I think right now, just to kind of take stock of where we are in California, roughly 75% of our crude oil is imported into California, 10% of the 75 comes from broader US, especially Alaska, and the rest of the 65%, comes from elsewhere. We do have dependents, including, Persian Gulf.

What we have seen, during this war and during this conflict, is that the refineries in California have been quickly able to for the sake for the purposes of crude oil move from Persian Gulf to Latin America. So in terms of crude oil access that's what we're doing.

But there was also a recognition from the legislature last year in passing of two thirty seven that was really important for some of the California refineries to perform really well, need access to California crude. And I'm grateful that the legislature acted on that to increase production for that purposes. In terms of refined product, we are today importing about 20% of our supply to meet our demand.

And over the last year since the closure of Valero or the announcement of closure of Valero and the closure of P66 Wilmington, we have steadily increased our imports. So broadly, if we ask our question, are there enough molecules globally to source California?

The answer seems to be yes. Are there enough vessels to transport? The answer seems to be yes. But it's more about the question on can we offload those molecules and make sure we distribute. That's on purely supply and demand.

But when we think about the holistic transition, what are we gonna do with the workers, how do we support our communities, It becomes a much bigger question around where do we wanna go from here, in in into the long term. I think it's prudent for us to make sure we t retain the refineries we have in California today until we have our long term plan really ironed out.

Okay. So following on that with the you said, right now, we've been able to import about 20% of the crude oil that we need to

The refined gasoline.

The refined gasoline on there. We're importing them from which countries as of right now. And the reason I'm asking is ultimately, it is my understanding that most other countries do not have the same environmental standards that we have here in California. Environmental, labor, the regulatory environments. We have the highest standards here in California.

So in your opinion, if we're trying to achieve these clean goals, is it reasonable in your personal professional opinion to be importing these, you know, the oils, or the fuels from these other countries? And you're more than welcome to explain which countries we're importing the the the fuels from and whether or not their standards are at the same level as we are.

To me, in my opinion, my humble opinion, if we're importing it from other countries that do not have the same standards, we're kind of nullifying every effort that we're making here in California. And I my personal opinion, and I'm not an expert, but I would say, you know, it would be to our best interest if we really want to impact the environment to ensure that we're actually utilizing the full potential of California and their ability to, produce the oil here.

Yeah. You know, Senator, I really read your, the spirit of your questions on really thinking about how do we really procure the molecules and serve California taking into account the holistic, impacts of that, plan. So, to your, first question, about 50% of our imports currently are coming from the broader United States. It's either Washington, the state of Washington, or from the Gulf Coast, and the Gulf Coast molecules typically go through Bahamas and come back to California. So about 50% of that is coming, from there.

The other 50% is broadly Asia, including India being one of the largest, exporter of refined product to California. We also have Japan and South Korea. And every once in a while, we do get some supply from UK. To your point, more broadly on what's the best way to move forward, and I think I want to tread carefully on that question because it's much more analytically important analysis beyond the scope of the Energy Commission.

But I do honor that we should really dig into what are the impacts that we see from the broader sourcing of molecules from everywhere in the world.

So I think I recognize your question and I think I would continue to have the discussion with you.

Okay. And so on the environmental part of it, that's that's one of the concerns that I have and I would love to to continue that that conversation. But also on the cost of what it what it what it takes to import and and transfer that fuel throughout the state of California per our needs versus doing it here and processing it here.

Absolutely. I think there is a few pieces on that. So one, I think, you know, in the response to the governor last year, you know, that that our office, wrote regarding how to stabilize the industry in California. We did, recognize the importance of the strategic alignment of local and state regulations broadly to make sure that the industry clearly understands a durable, place on where the regulations are going so they can adequately plan. So I I do wanna recognize that.

On the other side of it is, you know, we're also thinking through the economics. So for example, the legislature has passed the two thirty seven, essentially allowing for about 2,000 new permits in Kern County, every year. While we have that, we haven't fully seen Kern County producing yet. And I think part of it, it goes to the global dynamics.

The way it stitches that is the producers in California even in a prior to some of the regulatory burden that they had, had some reduction in production based on economics and and how they compete globally because it's a global market.

In terms of refined product, you're also correct. For example, today, in today's context, a molecule that's leaving you know, India and getting on a freight, that's about, two or three times more expensive than before the war, those costs do get passed on to the consumers. And I think it's important for us to, recognize that as the transition happens, some of that is also the business, decisions and the corporate decisions on how they wanna use the money, where they wanna invest the money for long term.

Okay. I'm just trying to think of the logic of Senator Grove if she were here. She's not here on that end. I'm just on the I just wanna make the final point that when it comes to the environment, how we're processing it, as well as the cost?

Because I the fuel even prior to, I'm assuming, and and correct me if I'm wrong, but even prior to the war, would you say that it costs the same or more to import that that fuel to our to the state versus producing it here or refining it here?

Yeah. On the refined product, today, the marginal barrel is import barrel, as of today. That means that the last barrel that we're selling in California that is imported is more expensive than in state.

Okay. That suffices for me. Thank you. Thank you.

Thank you. We'll go with Senator Laird then Senator Reyes.

Thank you very much, madam chair. Thanks for meeting but that's something you do anyway whether it's energy projects, battery storage fires, or Diablo. So we've been doing that a lot. Let me follow-up on what was just asked but ask it a different way because when you were sort of a point person for energy projections at the time that Diablo was considered for extension in 2022.

You your point was absent that decision to look at what the energy projections were for what was gonna be on the grid and you could match the 9% or whatever it was that that Diablo put on the total grid against that.

So you made projections in 2022 and how we would look for all the years up to the extension in 2030. How are we doing? What have been the trends and what do you see the trends? I mean that was implicit in the question but I thought it explicitly asked about the demand side.

Yeah, absolutely. Senator, thank you for that question. I think when we were considering the extension of Diablo in 2022, we as a state were structurally short. So we were coming into the analysis and the reason why we found it prudent to extend Diablo at least through 2030 was given the resources we had in state, given the confidence of how much imports are gonna come into the state, we were potentially looking at, you know, three to 6,000 megawatts of shortfall from 2020 through 2020 2030.

And one of the, one of the two things that the legislature have done during that time was making sure we had the Diablo Canyon as, you know, as a backstop to make sure we had those electrons available, but at the same time, directing the agencies to plan for its retirement by 2030 and plan even during this time as if that didn't exist.

Second, you also gave us the strategic, reserve that allowed for an insurance policy if we needed those resources. As we sit in 2026, given that we have added 30,000 megawatts of new resources since 2020 and we have another 28,000 to 30,000 resources in the pipeline under contract, we don't see the same structural deficit that we sat in 2022.

So as long as we continue to take the planning with the criteria of increasing demand and making sure we're building at the rate we are building, for which I have confidence. We have been building 6,000 megawatts in 2024, almost seven in 2025. So if we keep up with that, we are in a completely different situation in terms of pure reliability in need of Diablo.

So the decision about 2030, and I don't mean to put you on the spot but you're leading us there. The decision is is that we could live without Diablo on the Grid but it's always nice to have extra electricity and that is the nature of the decision we would be making on a potential extension.

And affordability. So given that affordability has been such an issue, I think the CPUC ran a few sensitivities in their IRP process last year and their preliminary analysis suggested about $1,000,000,000 in rate payer savings each year. And they are continuing to update that analysis. And I think that's something the legislature should look at.

And for those of us that are laypeople, what kind of energy is it that has been coming on that you you gave the numbers? Right. I mean, is that primarily battery battery storage? Is it more wind and solar? Where are we and what is actually coming online?

Nearly half of that is storage, and the the rest of the majority is solar. So we have largely added a lot of energy onto the system. And, going back to 2022, as well as 2020 when we had the lights go off, the reason for that was our struggle through the net peak, meaning when the solar goes down, and we needed something to ramp up. And that's precisely what the storage does.

And we have been able to add about 17,000 megawatts of storage onto the system in California, both on the bulk, plus the rest.

And and I get that storage is is necessary for when the wind doesn't blow and the sun doesn't shine. Is it such that we have wind and solar online that we can't utilize in the grid in California because we don't have enough storage? And then actually when we bring storage on, we're allowed to utilize things that are already there. Is that in part what's happening?

Yeah. Absolutely. I think

Do we export it from California if we don't?

Yes. We do. And yeah. Absolutely. And I think, you know, just touching briefly on the markets, the EIM, the energy imbalance market, and more recently, Caiso has moved into the EDAM, which is the extended day ahead market.

You know, the precisely the reason why we save dollars for the consumers by being a part of the markets is that shuffle. There is cheap energy available outside of California at certain times of the day and certain times of the day we can export our energy to make sure that it's coming at both the benefit of reliability but also cost pay rate payer savings.

And it seems to me that one of the issues that isn't always totally understood about Diablo Canyon is the nuclear power plant fires up and it fires up for a week. Unmodulated. They just do that and it goes. And so if it turns out we have a real excess of renewables, we cannot modulate Diablo Canyon to deal with the fact that we have a lot of wind and a lot of solar on in that moment. So how do we deal with that now when that happens?

Yeah. So I think the the basically, that's how the market that's where the market becomes really important in how we dispatch those resources. So as you said, base loads such as Diablo run continuously twenty four seven, and they usually are just taken as present in the market. And then you have other resources that are intermittent going up and down, and you dispatch them in a way that it's economical and reliable.

And even today, even with the advent of the amount of storage we have on the system, we still curtail.

And the hope is that as we have more storage in the system, the curtailments reduces and as market becomes more efficient, we don't use lose electrons.

And we're in what is known as the mid transition from starting the climate goals to getting to carbon neutrality. What are the other challenges that you might not have named in the second half of this transition? What kinds of things are you grappling with to try to make sure that we get there?

Yeah. Senator, I think that's a really important question that, I think the legislature and the agencies should work very closely on. The place where we are in terms of declining demand in petroleum, beginnings of the decline of natural gas and the increasing electricity did not happen in vacuum. And those were driven very clearly by the climate policy of the state.

So given that we are in that moment, as we have declining levels, for example, in petroleum, we still do not have the alternate system, which is the EVs completely at scale.

So I think it's important for us to recognize how do we both going to manage a decline that's smooth, but also double down on the investments we've made in terms of transitioning into the clean resources. So I think the mid transition requires us to do things proactively. One, making sure that the existing system is managed in a way that we do not preemptively push the system out before the new system is built. That also means we need to continue to invest in the new system.

Given that no matter what the transition is, that will be impacted stakeholders and impacted communities, we need to proactively support the transition.

We need to make sure the workers are protected, the transition funding exists, and the communities are protected from potential environmental liability. The cities are protected from potential fiscal shortfalls. I think those are the things we have to proactively do, and I know the legislature has a lot of competing issues that you're dealing with. But I think as we go into this mid transition, it's important for us to have a plan on where we are going and ensuring that we invest in that plan.

Well, you can tell from the other hearing that we have another interest that is competing that we're really dealing with. But on that score, one of the things you didn't mention was data centers. Now is that something that is skewing your projections or you're having to deal with?

Yeah. So data centers is a big one. We have made a significant progress and thanks to CPUC's partnership on this. The utilities have been essentially sharing with them the applications that they see coming in. So we have, you know, based on today's applications, we could have as much as 25 gigawatts of data centers by 2045.

But the important thing for us to recognize in that is how can we use historically available data to understand what is the credible load that is going to come online. So what the staff have done is looked at historical information on when a data centric application comes in, what are the different steps that go in, and what is the throughput rate at each of those points.

So baked on that, the Energy Commission has baked in about five gigawatts into the planning for the fifteen year forecast, which PUC is planning to. And for the local reliability, we baked in about seven gigawatts. I think it's really important for us to note that some of the developers who have interest in building in California are the same developers in the rest of the West.

And so the state agencies have to be very prudent that some of these applications are not duplicative and this load is actually credible. So given that it's looking at a fifteen year long term, we have and the forecasting and the planning happens every year, we have the opportunity to be agile and continue to modify our path as we move forward.

And when you were talking earlier about the projections of of where you were and and we were using the context of Danilo, those projections include what you just described about data centers.

Back in 2022 now. I know not in 2022. But today, yes.

But now.

Yes, we do.

Okay. So if there's an argument made that that our estimates are not right on the money because we haven't factored in data centers, you are working Yes. At estimates.

Okay. Then on another subject related, the legislature adopted AB 205 a few years ago and for battery storage projects and some others of certain sizes, a developer can opt into a state process and go past the locals. It's minorly controversial in parts of my district. I was gonna ask you how that was working and like have you had many projects? How do you deal with it?

Has there been local inclusion in sort of your hearing process if in fact they're bypassing the locals? How is that working?

Yeah. I want to just uplift two people from the CEC. One, commissioner Garrido, who's the lead commissioner on this issue, and also our executive director Drew Bohin, who has direct statutory and regulatory mandates to lead that process. I think it's going well. Our first project was a learning experience.

And as we went through the first to today, I think the processes are getting better and better. To your point, local input is extremely important. The state process is not, does not mean that we are not going to take the local input. And we currently, have total of 10 applications. The CEC denied one project, approved two.

We approved the second one about a couple of weeks ago. We have another three currently under assessment in the two seventy day window and another four that were incomplete and sent back. So overall, I think the process is going well and it's always helpful to have more resources as these projects come in.

Well, that was timely. And then lastly, last question. We have a letter of concern about your appointment and the and the concern is about the time frame in which the time line for resupply and minimum inventory rules might be provided. And the concern is is that somehow we would confirm you before that happened and we're not leveraging you for the right pressure to do that. Speak to that.

I mean, what's the intent? When might it happen? Is there something we should be concerned about?

Yeah. Senator, thank you for that question. And I want to make sure first I acknowledge the extraordinary moment we're in. The conflict in The Middle East has absolutely impacted the prices across the globe. It has impacted the prices in California.

It has impacted the prices in the rest of The U. S. And hence, both the questions that we're getting from the legislature as well as key stakeholders such as the consumer watchdog are really important for us to be able to hear and respond to. And the consumer watchdog has always been an important voice in Just

for the record, they're the ones that suggested what we're talking about.

Yeah. And it's really important voice for us to be accountable to. So, with that, I think the important thing to recognize, the the last two and a half years to three years has been a significant evolution in the petroleum industry in California. Right after the passage of the second special session, we had P66 Wilmington that announced closure. It was unrelated.

They said that publicly, but it was an important thing for us to think about whether that refining capacity can be met through imports. You know, a few months later, we had Valero, you know, in Benicia, they, announced closure of Benicia Asset. And then we received a letter from the governor and and making sure we really doubled down on efforts, to coordinate.

And what the CEC has tried to do is to take the totality of the information we have and both through a set of regulatory processes and enhanced coordination, bring in voluntary compliance into what we need to manage supply. So let me give you an example.

In 2022 and 2023, that precipitated the special sessions, one of the key measure that we used in California was what was the delta between The U. S. Prices, gas prices and California gas prices. And the reason why we used that metric was the delta between The US average and California average was indicative of something very specific to California, and that's why we use that.

The current prices, as as while they are really high and and very concerning, the overall delta between The California and The US has not changed since the beginning of the war.

The when the war started, the California US differential was roughly, one sixty six. And today, it's it's four cents lower than that. So just wanna recognize that this particular event is driven by a completely different thing than what we were seeing in '22 and '23. To that end

Meaning meaning the the shock from The Middle East is driving both up at almost an equal level.

Exactly. Both The US and the rest, you know and some of the states are experiencing this much worse in The United States than us. Today, from the start of the conflict to where we are in terms of prices, we are twenty eighth on the list in terms of how much prices have gone up versus others. Ohio is actually leading because of some of the supply issues they have today.

But I think the coming back to the question, it's also really important for us to note that the tools, if we used, would not have dealt with a situation like this.

Those tools were not responsive to the current extraordinary moment that we are seeing. And finally, to to add that, it's not that we have put those, tools aside. What we have done is we passed a regulation that makes the industry provide their resupply plans whenever they have a planned outage, and we currently have them. Because we have them, we are able to coordinate behind the scenes on how to bring in more supply.

And as I mentioned earlier in my comments, both in March and April, after the start of the war, we had more imports into California of refined product than ever before.

So I just wanted to note that. And finally, there was a concern that was laid out in the, in the letter of opposition that the refinery margins, you know, might expand to, a dollar about January, meaning close to a dollar 50. We just posted our data for the month of March, and it's actually at about $1 which is exactly as, you know, three of the last four years. So just wanted to note that, for you to consider.

Okay. Thank you. I really appreciate. You've been very responsive tonight.

Yeah. Thank you, Senator Reyes.

Thank you so much. And I want to begin by thank you thanking you for always being available. There are, complicated questions as we navigate the issues having to do with energy. And it's good to have a trusted source, that we can call on to ask questions candidly, without feeling like we are uneducated, dumb in asking questions. You provide answers to to help to educate us in making some of these very important decisions.

I want to thank you for that and for for the many meetings you've had with me and with my staff. I I I also wanna thank you for this. You recently did a you you were a witness. You testified and you gave this as one of your exhibits whatever.

I want to thank you for that and for for the many meetings you've had with me and with my staff. I I I also wanna thank you for this. You recently did a you you were a witness. You testified and you gave this as one of your exhibits whatever.

Showing where the crude oil is coming from.

That's very informative and it helps us to see exactly where it's coming from. Whether it's gasoline inputs imports or crude oil. And to see the visual of where our the the gasoline or crude oil is coming from just reminds me how we need to be good neighbors to Canada.

That's for sure. The other is where you talk about the, you know, with the loss of Phillips 66 in Rodeo, Wilmington, and Valero, and Venezio.

What what we're going to have to deal with, in what we're what we're going to what we what we're losing. So I thank you for that. Those sorts of things that help to educate us so that we can see the big picture.

I do want to talk about the zero carbon electricity going back to to the the legislation from De Leon and also from Senator Laird about what our goals were.

And my question is, do you feel that we have the capability and capacity to meet our 2045 goals?

Absolutely. I think the planning is in place. I think the goals are feasible. The processes are in place. I don't really see at risk of us meeting that, Senator, as long as we continue to build in California.

It's important to note that we are talking about building about 300 gigawatts of resources. So those are about 3,000,000 acres of land in California.

So when we have those numbers, it's important again to the spirit of the previous conversation too, that everyone needs to be at the table to make sure the projects happen quickly and you know get interconnected. So as long as we are able to do that, yeah, we I don't see a risk in meeting that.

Wonderful. And I wanna talk about the opt in certification. The trailer bill from '22 which is updated in '25. How has the opt in certification process been working so far? And how how does the CC determine which projects are approved?

Yeah. There is a robust process and just to add, I think that from my vantage point, you know, as as one of the commissioners who ultimately have to vote on this, while I don't lead it, the process, in terms of making sure there is procedural equity,

everybody is be able to be at the table, the risks, and all the CEQA, the different parameters in CEQA are well understood.

The impacts are understood, whether they are mitigable and whether the benefits outweigh the costs is an important part of the overall process. So I would continue to say that, you know, in the leadership of Commissioner Gallardo, and our executive Drew Bohan, I continue to see progress in making sure the process learns from each project we approve or deny and the input we get in.

So I think the success of voting on the largest solar and storage project, the Darden project about 2,000 I mean two gigawatts, that was an incredible success.

And an important part of the process is also community benefits, which was, a deliberate thing that the legislature asked us to look into. And having these conversations is not easy.

And when we hear the comments from all parties, the two projects we forwarded, really do see feel like we're doing a good job.

Wonderful. Because it includes the entire community. And I appreciate that that's part of it. I'd like to now talk about the the ZEVs, the incentive programs specifically for medium and heavy duty vehicles. I know that the state has done a lot to incentivize.

We've invested in programs, like HVIP, delivered more than $1 billion in funding to fleet statewide since its inception and supported almost 12,000 clean vehicle, vehicle statewide.

The problem that I'm seeing is that even with these incentives, the cost of a truck of a ZEV truck has not gone down. And in Europe, the prices have come down. And we can't be doing the incentives forever. The incentive is to to help, the manufacturers know that we really are transitioning.

We're going to help people get into the trucks, but we we we need for those truck prices to go down. So it's less incentive and less price and makes it better. But why do you think the prices are still rising so much in California?

Yeah. I'm sorry. I wanna be mindful on this one. I do not track the specific incentive programs and I know that CARB is kind of the lead on this issue.

But having said that, I think the sentiment that you just mentioned in providing public monies, I think the idea is to scale and make sure the market then picks up and reduces the costs and that the incentives do not then become a reason why the prices stay elevated.

So I think I absolutely agree with you. I do not know exactly the specifics. I would imagine there are some impacts of the tariffs.

There are some impacts of how the global transition is happening, where the vehicles are coming from or not coming from and how we are able to scale that. But I will come back to you on that question a little bit better.

Wonderful. It's a really important question as you know in in my community. Menjivar heavy duty trucks caused the greatest harm to the health of the community Absolutely. Because of the the diesel particulate matter. So transitioning so important.

And if we're making those investments, I want to see that there is there's something good happening. Specifically with the prices. So that more of those who own trucks and who transport in trucks are able to transition over.

The my last question because we you've already addressed the the opposition letter, which is, for me, opposition letters are very important. It is something that always needs to be addressed.

So I appreciate that my colleague has already asked about that. In in 2023, it just happens to be one of my bills.

But we established we criteria to make sure that we are prioritizing disadvantaged communities in our investments and making sure that that as we make those decisions that we do look and I understand there are points given to make the disadvantaged community as you're evaluating.

But how do you prioritize investments in disadvantaged communities?

Yeah. Absolutely. Senator, in the Energy Commission, as it pertains to the investments that we need to make, we do have guidance from DCAG, so and which is the disadvantaged communities advisory group, which advises both CEC and PUC.

And we also have a specific advisory board as it pertains to transportation investments. So between those two, there has been a lot of work done to ensure at least 50% of all investments that are going out of out of CEC do make it to disadvantaged communities.

And I believe, based on the information we have today, that is true. What we continue to have to do is while we are geographically investing in disadvantaged communities, 50% or higher, it is important for us that those impacts are truly being felt by the community that is getting that money.

So that's something that we are actively looking into, and I know that's been a priority for you, and we do not take it lightly, and we continue to make progress on that.

Wonderful. I sincerely appreciate your responses. It's been very informative and it's it's the things like this that help us to to understand these very complicated issues and I sincerely appreciate that and whenever you have an opportunity to share with us, please do so.

I mean, I have very good staff that looks for these things and make sure that that I have them and that I'm aware of them.

I just wanna take a a moment on that Senator. The work that I'm able to present, I stand on the shoulders of a thousand staff at CEC, and it's their work that I present.

And, one of the persons who worked on that particular slide worked all weekend to make sure we presented that. His name is Sunit. So I would have prepared it for the record.

They did a great job.

Thank you.

Thank you. I'm going to ask you just a little bit. You know, some of some of the work that the CSC has been able to do has been in a different in a lot of different areas.

But one of the things that was created through legislative action that became under the purview of the CSC is the petroleum market oversight.

And so I wonder if you can speak a little bit to the what that has done in terms of price gouging, and our understanding thereof, what you've learned from the implementation of that, if there are still gaps left to better understand and get a sense of this all started from this mystery, tax and this mystery cost.

And so help us understand where we are at now that legislation has passed, and that you have, an authority that you didn't have previously.

Yeah. Absolutely. And, Chet, thanks for asking the question. I just wanted to start with, I think the creation of DPMO, the Department for Petroleum Market Oversight was an extraordinary thing and was very important.

Prior to the department being created and wanted to recognize that they are independent within the Energy Commission, And because they do a lot of legal work, we do not necessarily have access to what they do completely.

But, you know, they have helped us enormously in trying to figure out what is the right kind of data that we should get from the industry. So overall, in our efforts on just improving transparency, DPMO has been a very important partner.

In terms of what the Energy Commission has historically done and where DPMO comes in, The Energy Commission going all the way back four decades to the PIDA statute, the WARNAQIS Act, the IPRSS statute has historically focused on what is the supply demand balance

in California, what are the forecast looking like, what are the emergency plans when we have a shortfall. And we put out the information we had on prices more from the point of observation.

But we never had a specific entity focused on understanding whether that numbers those numbers we are putting out, are actually because of market power or market manipulation. And so, yesterday me and, director Meijlder, as well as, professor Bornstein all testified.

And one of the things that, DPMO is right now looking at as it pertains to the current war is the differential between, the high cost at branded stations versus unbranded, stations and that being a dollar amount, which they presented yesterday.

And similarly, just looking at some of the work that they have already started, they have been advising us whenever they have when they have analysis that might not be completely open to us. They do guide us on any market issues.

But most of the market power, I imagine, are currently under investigation, and I'm not privy to that analysis.

Thank you. One area that we haven't touched on, I don't believe I heard, has to do with pathways initiative. And so I'm wondering if you could speak just a little bit in terms of the status of the regional organization, and where you see that going and the impact that it could have on consumers.

Yeah. Thank you, Senator. The energy commission and PUC were absolutely a part of, working on the value of a potential regional organization that can provide the market design that benefits the West as a whole.

So the West can see the markets as for the West by the West. But once we do that, it was important for us that we, the state agencies, as we have this regional organization, really ensure that the perspectives of California are being presented similarly as other states do.

So where we are, as you know, the California ISO has taken, certain, decisions to move forward, with being able to join, an organization when and if that is formed.

Today, I'm tracking next I mean, about six months to a year from now, they're expecting to have a full board for that and then constitute that, and that's when the real work starts.

The real work is around what the guidelines are and what is the agreement between Kaiso and the regional diversification are gonna be look like and those are the processes that are beginning to start. And from, I think this is something you raised in the past.

You want California consumers to be absolutely protected in this process and that is our job moving forward. I think both CPUC, CEC, our job is to be one of those voices, stable, and advocate for the protection of our rate payers.

Thank you. And and that is indeed very important to me. And, as we've talked about some of the policies that have and some of the topics that have been brought up, I will say that that continues to be important to me in so many of the different areas, including Diablo.

So let let me ask you just a little bit what almost everyone has asked you about, which also has to do not just with gasoline but also electricity. And I represent an area that has regular, natural disasters, particularly wildfires.

And, there, at times, are moments where those natural disasters, are the reason for outages. But we also, as a state, worry for other reasons, and that includes our supply. So there's the things that we can control, and the things that we have less control.

But it turns out that when mother nature, you know, mother nature always wins. Yeah.

And help me understand in terms of the risk for future outage outages or the lack of risk and what we've done as a state in particular through the CEC to reduce that risk for customers in California.

Yeah. Absolutely. Chey, I think the main point as we the lessons that we learned as we were coming out of the 2020 outages were broadly three. One was we are use we were using most of the climate data, historical climate data to plan for the future.

And we recognized that we cannot do that. So just kind of looking at trends would not be enough. So the important part of the lesson there was how do we bake in the climate change and its impact on the demand? So that was one.

Two, we looked at, you know, being behind on procurement, and really making sure that we procure. And since then, the, PUC has done extraordinary amount of procurement, through their processes.

And finally, that the state agencies have to desilo and communicate better. So that required CAISO, CARB, CEC, and PUC to be a single unit as we plan these things. So as we move forward, we also have DWR at the table now and many of the, POUs at the table.

So based on that five years on, we have done everything we can to incorporate the climate change impacts to center lay it's point early earlier on the data centers.

There are a few uncertainties that we still have to think about, whether it's data centers, whether it's the future of hydrogen what does that mean, how much is the load.

So we are able to adequately bake that risk into the forecast. And we've done significant amount of procurement and the the data point there is we've been able to add 30,000 megawatts or 30 gigawatts, and we continue to see another 30 in the pipeline, so which is really healthy.

So taking all that into account, this summer, we have come in with almost 6,000 megawatts of resources in excess of standard planning.

And even if a 2020 or a 2022 level heat event were to happen, we would still have reserves on the system. But to your point, mother nature always wins.

If you have a coincidental risk where you have extraordinary heat across the West and combined with fire that knocks out important generations, it'll still put us under immense stress, and that's something we plan for through contingencies now since 2020.

And we have about 4,000 megawatts of contingency resources that we could lean on if that happens.

Thank you. I want to echo the thanks that you received from others. You have been one of the most accessible appointees, to the legislature, and, that goes a long way for the legislature.

And certainly, we have had a lot of conversations. And sometimes we agree, sometimes we don't agree, But that exchange of information has been really important, to our deliberative process in terms of where we get to as a legislature.

So I wanna thank you, for that. It's, not as common as I would like sometimes, but I appreciate that exchange of information that has happened between you and and many in the legislature.

And that also means participation in hearings, which you've never shied away from, participating. So thank you.

Cheerah, I just wanna say thank you. I think I equally appreciate the opportunity to be able to, share with you the information, build the necessary trust and accessibility, but also get your guidance in real time. So I appreciate, the access and and your guidance. Thanks.

Thank you. With this with that, we are going to now welcome those that are here for public comment. We're going to begin with those in support. We're gonna ask you to come forward. Just as a reminder, we have four minutes.

So we're gonna do two and two for folks who have comments to say. We will Are we doing this? Nope. We will have to limit you. Let me see. After the two minutes, we will go to just Position, name, position, and affiliation. And then we will do this for the opposition after we do the support. You bet. Thank you.

Good afternoon. Daniel Barad, on behalf of Union of Concerned Scientists in aggressively strong support of Vice Chair Gunda's confirmation.

Over the past several years, the Vice Chair has been called upon to solve some of the most urgent and complicated issues facing the state, from electricity reliability to gasoline supply.

These issues have required balancing competing but crucially important interests under an unbelievable amount of pressure. I had the opportunity to work closely with the Vice Chair in response to the closure of two in state refineries.

The Vice Chair responded by Locking Enviro's, communities, cities, labor, and industry all in a room for hours, and he didn't let us leave until we heard each other out fully and came up with a plan to move the conversation forward.

His intelligence, vulnerability, humility, and unwillingness to leave anyone behind helped guide these extremely difficult conversations and led to a thoughtful and thorough 24 page letter,

which was the basis for SB 237 last year and will continue to serve as a road map for these conversations and important work as we move forward.

The hearing that the Vice Chair brought up yesterday, he didn't mention that he was on two panels back to back and sat at a microphone for six hours, and he was just as thoughtful and attentive in the first hour as he was in hour six.

He's a machine, but he's a machine with a big heart, and that's exactly what the state needs in this moment. Siva Gunda is has been an incredible Vice Chair, but he's somehow an even better human being.

We respectfully request your Aye vote.

Thank you. Next.