Senate Standing Committee on Local Government

The Senate committee on local government will come to order. Good morning to everyone. Thank you for joining us for this meeting. The Senate welcomes the public in person, and we are holding our committee hearings in the Capitol Building. I ask all members of the committee to be present in Room 112 so we can establish our quorum.

We have 31 bills on today's agenda, six of which are on consent. File item 6, AB 1622. File item 12, AB 182. File item 14 and 15, AB 2219 and AB 2890. Item number 24, AB 2512, and item 27, AB 2341.

We ask everyone to keep their remarks as short as possible for this lengthy agenda. First, more housekeeping. At the request of the authors, the following bills have been pulled from today's hearing. File item 16, AB 2033, and file item 21, AB 2139. We will get started as a subcommittee, and I think we have, yes, one one member, Assemblymember Schultz, if you'd like to come up.

Good morning. Welcome.

Good morning, Madam Chair and colleagues. Thank you. Thrilled to start off your day. Sounds like it's gonna be a long one. Try to give you something nice and simple if I can.

I am pleased to present AB 306. I believe you both have heard this before, but just for the sake of the record, I'll be quick. I will note thank you to the committee and your staff for the hard work. We do accept the amendments further described on page six of the analysis.

By way of background, AB 306 would require the California Building Standards Commission, to hear and decide appeals regarding a local agency's implementation of the state building code and issue code interpretations.

California's 540 jurisdictions independently interpret and amend state building standards leading to both in in inefficiency and inconsistency. There is currently no mechanism in our state for a housing proponent to appeal a local code interpretation and no mechanism to apply for a code equivalency determination across multiple jurisdictions. The current appeals process requires local agency participation, which is extremely rare. It also requires prior exhaustion of all local appeals. The limitations of the current appeals process, has led to negative outcomes.

Navigating approvals across 540 independent jurisdictions is a major impediment to scaling innovation statewide, and it significantly increases costs and timelines for project delivery. In closing, AB 306, addresses the lack of a practical and effective statewide appeals process to resolve code related issues of broad significance. It does so by establishing a more workable process for resolving building code issues that have statewide implications while preserving local authority over matters that are appropriately addressed at the local level.

With me to speak today in support of AB 306 is Mike Malinowski, a licensed architect and consultant with the American Institute of Architects, California, of course, and Ali Saperman, advocacy and policy manager with the Housing Action Coalition.

Good morning. Where would like to begin?

Madam Chair and Members, I'm Mike Malinowski. Forty six years

You have two two minutes. Thank you each.

Understand. Forty six years of licensed architect representing AI California whose 11,000 design professionals prepare the design documents for virtually all commercial and high density residence development in our state. I want to thank the Chair and committee staff for time and collaboration in refining this bill. We're sponsoring this bill because the current system for building code interpretation and appeals creates unnecessary inconsistency, delay and cost. The same state code can be interpreted differently across five forty jurisdictions, which leads to negative consequences, particularly impacting housing delivery.

Consider a seemingly simple example, a townhouse jurisdictions differ on which code applies. Is it the simpler CRC or the more complex CBC? How occupancy is classified? Is it R2 or is it R3? And the detailing of walls that separate units.

This means a set of plans approved on one site may not work across the street that affects cost timelines. And sometimes whether a project moves forward at all, AB 306 provides practical workable process for appeals and statewide code interpretations while preserving local control over local issues and project specific decisions.

This bill builds on models proven to work such as the state fire marshals well used and highly functional code interpretation process through which any person can request clarification of the fire code with results posted online and coordination with local jurisdictions built into that process. AB 306 directly supports housing innovation.

For example, three d printed concrete homes are already being used through a local alternate materials and methods approval in the campfire rebuild area that could be scaled, but it currently requires review by jurisdictions one at a time.

Each of these approvals can come with unique conditions and requirements, goodbye efficiency and cost effectiveness. This is a balanced and practical reform. I respectfully ask for your support.

Good morning. My name is Ali Saberman, advocacy and policy manager for the Housing Action Coalition. I'm speaking today in strong support of AB 306. At Hack, we represent developers, architects, attorneys, construction professionals, and labor unions across California who enter who encounter building code inconsistencies as a daily barrier to housing delivery. California's 540 jurisdictions independently interpret state building standards, and there is currently no practical mechanism for an affected party to appeal a local interpretation of their own.

The existing process requires local agency participation, meaning a jurisdiction must essentially agree to appeal its own decision, which essentially never happens. AB 306 fixes that. The bill's code interpretation request process is a meaningful addition, giving the person an ability to request a determination from the California Building Standards Commission. The state body that adopts and publishes this California's Building Standards Code creates real accessible pathway for resolving ambiguity that currently gets resolved inconsistently across jurisdictions or not at all.

For hack members working on adaptive reuse, this matters especially.

Local code amendment triggers for adaptive reuse projects vary dramatically across the state, and there has been no state level forum to address that. AB 306 begins to change that. That transparency requirement requiring local agencies to post their code interpretations and amendments online is simple and overdue. Hack members regularly discover local interpretations mid project. Making them publicly accessible upfront reduces cost and delay.

I respectfully request your Aye vote on AB 306. Thank you.

Thank you very much. Is there anyone in else in support of AB 306? If you can please come up with the microphone. Thank you.

Morning. John Scoglin with the County of Los Angeles in support.

Morning. Freddie Quintana with the California Apartment Association in support.

Thank you.

Stephanie Jimenez on behalf of Bay Area Council in support.

Danny Curtain, California Conference of Carpenters in support. We have to attack this housing crisis. Thank you.

Okay. Is there anyone in opposition to AB 306? Please come forward. No? Okay.

Seeing none, come to the dais. Questions, comments? Nope. Seeing none. Then you may wrap up.

I'll respectfully ask your Aye vote at the appropriate time. Thank you.

Thank you. And we're just here as a subcommittee, so as soon as we get the the Members to come on down, we'll take up a vote. Thank you.

Thank you. We have who's next? Good morning. I think Assembly Member Quirk-Silva. I don't see anybody else.

So you're next. Good morning.

Cassie's out to

Oh, how do we just to the circuit.

Should leave him for the rest. Okay. Good morning, Assembly Member.

Good morning, Madam Chair and Member. Thank you for having me today. My final time presenting in local government here. I am pleased to present AB 956, which clarifies existing accessory dwelling unit law by allowing a homeowner to build up to two detached ADUs on a property, provided those units comply with all existing requirements related to size, height, setbacks, as well as health and safety. This bill also clarifies how ADU law applies to HOAs and common interest development, CIDs.

In 2019, the legislature enacted AB 670 to prevent CC and Rs from prohibiting or unreasonably restricting the construction of ADUs. However, ambiguity in current state statute has created uncertainty regarding which properties within common interest developments are covered by those protections. The amendments taken in Senate housing maintains consistency with SB 9 and avoids inadvertently triggering density bonus law. Specifically, the bill authorizes either two detached ADUs that meet requirements or one detached ADU and one attached JADU, consistent with current law.

And we brought you this little handout.

Many families use ADUs to support aging parents who want to live close by, but also even young adults who are finding it very difficult to find an affordable place to live. Others, we know that there have been many attempts for young adults, as we just said, to find housing, and this is another solution. Over the last several years, the legislature has worked diligently to reduce barriers to ADU construction, and yet, there is still clarity issues within there, within how many units, where, and so forth.

Basically, this bill provides clarity. With me today in support of AB 956 and to answer any questions are Matt Doble, policy manager with YIMBY, and Ryan O'Connell, president of How To ADU.

Go first.

Good morning, Chair and Member of the committee. My name is Max Dubler. I'm a city planner and, policy manager at California YIMBY. California California's ADU reforms have led the nation, creating tens of thousands of new homes every year without, disrupting the look and feel of existing neighborhoods. Existing state law lets homeowners build three ADUs, one new detached unit in the yard and two from existing floor space.

AB 956 maintains the existing density limits while giving homeowners more flexibility in how they arrange their ADUs. For example, instead of converting their garage to an interior ADU and building a detached ADU, a homeowner would be able to do two detached ADUs, preserving their off street parking. This flexibility will particularly benefit people who own small houses on large lots and will help multi generational families live together while meeting maintaining privacy and independence.

The bill also clarifies the existing ADU exemption from CC and Rs, ensuring that single family homeowners whose properties are formally defined as condos are allowed to build ADUs. We respectfully ask for your aye vote.

Good morning, Chair and Members of the committee. My name is Ryan O'Connell, and I manage How To ADU, which is a community with over a 150,000 members on Facebook, all trying to build accessory dwelling units in California. And we run into so many of these same equity issues that Max just referred to. I think, thanks to the work of the legislature, ADUs have become a really important source of housing over the past decade in California. Right?

One in five new permits. But there's still this issue where even though the state allows multiple accessory dwelling units to be developed on a single family home property, really only homeowners with very large homes can make use of all of those ADUs because they can afford to chop off 500 square feet as a junior or something like that. This would open it up and allow for folks to, within the bounds of local regulations, trade that interior conversion for a second detached unit.

And it would clarify and open up opportunities for people in condo condos and TICs and CC and Rs to do more too. I see this in Napa all the time with big home with big homes where you can afford to chop off a master bedroom and an en suite and get that extra unit.

But on smaller properties from older homes, nineteen fifties and before, well under 1,200 square feet, there's much less of an opportunity to do that even though they're sometimes on relatively large lots where they'd be able to build that second unit. So, this highly tailored build creates a narrow way for homeowners to build those two units of new construction ADUs under the same government code, and I respectfully urge you to vote at the appropriate time. Thank you.

Thank you very much. Is there anyone else here in support of AB 956? Please come forward.

Madam Chair, Michael Gunning, Lighthouse Public Affairs here on behalf of Abundant Housing Los Angeles in support.

Thank you.

Madam Chair Bob Naylor for Fieldstead and Company. That's Howard Amundson junior, Orange County businessman. Thank you.

Thank you.

In support.

Okay.

Danny Curtin, California Conference of Carpenters in support of one of the few, products that are actually growing after all these thank you and congratulations.

Thank you.

Harrison Linder with LeadingAge California here in support.

Freddy Quintana with the California Department Association in support.

Thank you. Okay. Is there anyone no one else in support? Seeing none, is there anyone in opposition to a B956? No one?

Anyone in opposition? Please come forward. If you wanna take some time or you'll just whatever

you brief.

Yeah. Good morning, Chair members. Brady Guertin on behalf of the League of California Cities in respectful opposition. Wanted to first off extend our appreciation for limiting it to the two detach that was helpful, but we do remain concerned about ministerial approval process, and look forward to continued conversations. Thank you.

Thank you.

Good morning. Kiara Ross on behalf of the cities of Burbank, Thousand Oaks, Carlsbad, and San Marcos echoing the League of Cities concerns.

Thank you.

Good morning. Tracy Ryan with the Rural County Representatives of California. I'd like to echo the comments of the folks before me in opposition. Thank you.

Thank you. Anyone else in opposition to AB 956? K. Seeing none, bring it to the dias. Any questions or comments?

Yes. Senator Seyarto.

Thank you. During the the testimony here, you brought up something about the townhomes, HOAs. Townhomes are pretty much you own the property that is under your townhome. Are you talking about turning to ADU garage? How does that come into play here?

Because that opens up something Yeah. Thanks for the question. To me. So the the the issue that we've dealt with that we've seen is someone who owns a single family townhome, who wanted to convert his garage into an ADU, and his HOA did not want him to do that. And so the idea here and his his his townhome was formally defined as a condominium, although it was, like, on its own parcel with no units above or below it.

So the idea here was just to clarify the existing CC and R override and it will apply it to single family properties that are like technically condos.

Yeah. That that's the because all the space around them is is all HOA, common interest property. And and when we start applying this to stuff like that, there's all kinds of different stuff that comes into the mind. When you're converting a garage in a townhome development, you're creating a parking problem, because they already they already have parking issues in almost every townhome development I know. And taking cars out of garages, and that's part of sometimes people using them for storage.

But creating an incentive to have somebody rent downstairs in your garage and moving the cars out into the thing will create a huge problem. So that needs to be cleaned up a little bit. So we we're we're doing what you're saying. I can think of the ones over by the colleges there that that's that kinda has that layout a little bit, but they do have attached walls and stuff. So the ministerial approval, what does that mean to you, author?

How is that defined in your in your bill?

By right.

See, and that's the problem I have. Ministerial approval to me means that the planning director can hold the hearing, get input from the the the public and, and approve it at his level. Somehow the two have become conflated, and by right somehow means ministerial. And, and to me that's another terminology that needs to be cleaned up because there's a difference. To me, by right is they just come in, they put their application in and go start building.

By right.

That's a by right. And that needs to be more clearly defined because that that language affects a lot of of what we're doing, this legislation that we're trying to do, because it does exclude the cities from having any say whatsoever. By right, that's what that means. It means they can go in and do what they want. And because it fits whatever is in the the bill that we're doing.

And so that that creates problems for those bills as well. So , anyway, those are just the concerns I have with this particular bill. Your next one, I think, you'll be okay.

Senator Choi.

I also have, some concerns, on this bill because, basically, your bill is, trying to allow one ADU in the back of the house to two units. And do you have any specifications or limitations on the ADU size?

Okay. Do you wanna answer?

Yes. So, we're using the current framework just to speak to, the the previous question as well. So we're not changing the ministerial process, and the size restrictions in place in the existing government code section six six three two three would still be in place and applied to both detached ADUs. And and that is an 800 square foot limit.

Yeah. Can you tell me what previously I read about the main dwelling unit size has relationship to ADUs, certain percentage not to be over 15% or something 20%, etcetera. That's what I'm referring to.

That is an accessory dwelling unit in a separate part of the code, which we won't be touching. It's in section six six three one four. This is specifically to the three two six six three two three a d s.

Excuse me, Senator. We're just gonna take one second to establish quorum now that we have Senator Laird. Okay?

Okay.

Thank you.

[Roll Call] You have a quorum.

Thank you. Thank you, Senator Laird. Go ahead, Senator Choi.

Okay. My second question is that, especially, the residential single family zones, especially in my city of Irvine, we have a general plan for single family homes and the multi unit areas or industrial areas, commercial areas are separated. That makes our city very unique and desirable place to live. If this bill passes, already one ADU is allowed.

So when you add multiple units, in the originally planned zone area, for single family homes, and then the capacity for, like, utilities, water, especially sewage and electricity, gasoline, all of those will be impacted.

And then also traffic because we don't know the reason I asked about the size or set size of the ADUs will determine number of people who may be able to do well, live in that ADUs. So it could be single. It could be five. Who knows? You know?

In in total. So that will impact characteristics, and then also parking area parking parking issues on the street. Some some HOAs are very particular about even demanding us to not to park on the streets, to park on in the garages to enhance the characteristics of that community. So this will be all the ADUs is not gonna demand to build additional garages.

So this will change so much of the beautiful characteristics of that particular dwelling areas and how detrimental this impact that this bill will will impact the the such such areas or or cities.

Have you thought about the the demand of the the capacity of the demand by increasing the population in that area, which was not designed for?

Thank you for your question. I think we have two issues here. We have increased density and we have parking. On the parking piece, especially in HOA communities, HOA communities have the power to require permit parking, and many of them do not issue street parking permits to homeowners who have converted their their garages into ADUs. So there is there is the power to to manage street parking at the local level.

Second of all, if your ADU is further than half a mile from public transit, then you have you are local governments may require the construction of one parking space off street per ADU. On the density piece, I would say that keeping single family homes as single family homes does not prevent them from becoming overcrowded. California has some of the worst household overcrowding in the country, and overcrowding and density are not the same thing.

When I was in my early twenties, I lived in a single family home with six roommates and seven cars. We parked on the street.

There was no ADU. Allowing ADUs to have more physical flexibility and especially by allowing people to skip converting their garage into an ADU and instead build a second unit as a detached unit in the back back backyard, which will preserve their off street parking, reduces overcrowding while likely maintaining the same overall level of density in the neighborhood.

So I hear your concerns, but I think that we need to to separate out the issues of overcrowded street parking, overcrowded housing, and the density of actual dwelling units in the neighborhood.

Yeah. In the practical sense, now I had a little bit similar experience. I extended my home because I had a little bit of a space, but it was not a single ADU, so it was expansion. Even then, city brought up a lot of issues, like a separate address, separate mailbox, etcetera. And the mailbox are already fully fixed unless you pay for big metal mailbox in there and the creation of a new address.

But and when you create the two ADUs and then also separate bill, as I remember, the right for the homeowner to separately sell, not as a part of the main dwelling unit. So that will create all kinds of in in addition to parking issues, mailbox issues, address issues. This will create so much confusion for that region. Have you thought about it?

I don't think you.

You can maybe you can do that in wrap, if you wrap up, include some of the Senators' concerns. Okay. Go ahead. If there's no other or if you want anybody have any questions. If not, then you can wrap up, and please include references to Senator Choi's questions.

Yeah. To the Senators that, that, are opposed, I understand I understand, the concern of parking or overcrowding or, as you even mentioned, all the things that go with another residence on one side, mailboxes and and infrastructure. And and they are concerns. We know that neighborhoods have changed and are gonna continue to change in the future. This bill is an attempt to clarify what can be put on a property.

There have been amendments taken, and, there will continue to be work towards understanding and trying to make sure that, we work with neighborhoods, League of City, and others to, to address concerns. But, right now, neighborhoods are changing. This has been one of the few glimmers, if you want to say, in housing, which is allowing homeowners to have flexibility with their property. And when we think about that, I know sometimes people will say, well, they're building yoga students or art studios.

The vast majority of these ADUs are to house many times seniors.

We used to call them granny flats, and, many times they were built without permits because there was so much happening at the city level that people just, they even called them lean ons, I think, at one point. So times are changing, and this bill is to offer flexibility and to clarify. With that, I respectfully ask for your Aye vote.

Well and I wanna thank you for the visuals here. Some of us do much better with visuals. With that, I want do we have a motion? Anybody?

If you if you handle the gap Oh, you want he wants to.

Oh, I see. I'm not leaving. Okay. I move the bill.

Alright. Thank you. And, we have a motion by, Senator Durazo. Go ahead and call the roll.

The motion is do passed to the committee on appropriation. [Roll call]

Alright. Thank you very much. That'll be on call. Return that back.

Okay. Forgot. Sorry. Assembly member Quirk-Silva has another bill, AB 1751. You can go ahead and get started.

Alright, members. Another exciting bill to offer to the Senate Local Government Committee.

Alright. Of course, we want to thank the committee staff for their very, very step-by-step conversations with us. We are accepting many, many amendments today. I have a long list, but I am not going to read it out unless you would like me to read all the amendments. Okay.

But we accept all of them. Yes. Yes. We will accept all the amendments. These amendments strengthen the bill's focus on genuine, missing middle production while preserving the ministerial pathway that is the heart of AB 1751.

The bill itself builds on recent housing reforms by expanding access to one of the most attainable pathways to home ownership, town homes. Home ownership is moving farther out of reach for too many Californians. As you all know, we've had this conversation many times. A family now needs an annual income of roughly $221,000 to purchase their first home.

These numbers reflect a market that is pushing tradespeople, nurses, teachers, firefighters, and young adults out of stability, out of their communities, and even in some cases, out of our state.

This is a structural failure that is pricing out the people who keep our communities running. AB 1751 allows for ministerial approval of qualifying townhome projects that meet clear objective standards. It also allows local inclusionary housing ordinances to apply for projects with more than 11 units. The bill protects environmentally sensitive sites from being built on, consistent with existing laws on starter homes, and built townhomes would be no higher than three stories of occupiable living space.

If we are serious about addressing affordability, we need to create more pathways into homeownership.

This bill delivers one. With me to testify today in support is Ed Manning on behalf of the New California Coalition, who are the sponsors, and Michael Gunning on behalf of Habitat for Humanity.

Go ahead if you want to get started, and you each have two minutes.

Thank you, Madam Chair. Good morning, everyone. Ed Manning with KP Public Affairs on behalf of the sponsor, New California Coalition. Thank you, Chair, and Mister Faverina Sorba, for all the work on this bill. You know, the main thing with all the amendments that was critical for us is that when we came away from the bill, we had a high level of confidence that we would get townhomes built and that the requirements in the bill would work in practice.

And I'm here to tell you that they will. So I appreciate all the hard work. We wouldn't have gotten here without you. Why townhomes and why this bill? Townhomes are neither fish nor fowl in the zoning world.

They're not single family homes, even though they're owner occupied and affordable. And they often don't fit in a lot of multifamily densities. And so this bill is trying to find a solution to be able to build more townhomes. And why townhomes? They're 30% more affordable than single family homes.

Based on technical analysis done by MapCraft on this bill, we will have enough sites available now to build on, which we don't currently. And that will mean that people making between 150% to 250% of area median income will now have a lot more options to buy a townhome. They're producible, they're affordable, they're fairly dense. And so the price point is significantly lower, and therefore people can get financing and afford to get into the entry level housing.

We had 100,000 housing starts last year, give or take, and over the last five years.

And about 20 to 25% were ADUs, which are not homeownership, so that's a problem. And this bill seeks to give people access to housing that they can't get now in a significant way. There are a lot of technical issues in the bill that were addressed, and I'm happy to discuss any of those amendments if there are questions. Thank you, and I appreciate your support.

Thank you very much. Go ahead, Mister Gunning.

Thank you, Madam Chair. Michael Gunning here on behalf of Habitat for Humanity California in strong support of AB 1751 by Assembly Members Quirk-Silva and Wicks. California's housing crisis is not just about building more homes; it's about creating more opportunities for working families to become homeowners. Habitat for Humanity affiliates across California increasingly build townhomes and other multifamily ownership communities because higher-density homeownership is often the only affordable homeownership that's feasible in today's market.

The recent approval of the veterans and affordable housing bond, with its dedicated investment in affordable homeownership, is a significant step forward, but funding alone cannot produce homes.

We think that pairing these investments with smart land use policies like AB 1751 is what will actually translate those dollars into more affordable homeownership opportunities for low income working families. AB 1751 creates a predictable approval process for qualifying townhome developments, helping reduce development costs, making more efficient use of scarce land, and ultimately building more entry level homes for Californians that they can afford to own. For Habitat, the bill reflects the future of affordable homeownership in California.

While many still picture Habitat building detached single family homes, today's reality is that they're increasingly building thoughtfully designed townhomes and multifamily ownership communities that will allow more families to build equity, stability, and generational wealth. For those reasons, we respectfully ask for your aye vote.

Thank you.

Okay. Thank you. Thank you very much. We'd like to have anybody else who's in support of AB 1751 please come forward. All in support.

Madam Chair and members, Bob Naylor for Fieldstead and Company in support.

Thank you.

Madam Chair and members, Danny Curtin, California Conference of Carpenters. We still want to express our opposition to the removal of the minimum wage increase to the lowest paid, most exploited workers. We are in strong support because it is the housing crisis. We are not neutral on the basis of that activity. We still think it's needed. Thank you very much.

Hi. David Rommel with Veterans and Business Network, and we support this bill.

Thank you.

Marisol Ibarra-Bouslama with Family Business Association in support.

Thank you. Anyone else in support of AB 1751? Seeing none. All those in opposition to AB 1751, please come forward.

Good morning, Chair and members. Brady Guertin on behalf of the League of California Cities in respectful opposition to AB 1751. I want to express our concern about three important issues for our local governments. First, I want to acknowledge that this bill would require local governments to potentially decrease the density in their communities that they have planned for.

For the last ten years, the legislature has encouraged our cities to upzone and promote more infill development and larger developments, and our cities are doing their housing elements accordingly.

This measure says if it is 75% of the same minimum density, we cannot do our objective standards and meet our local zoning plans as required. And we would recommend, if there are amendments around this issue, that we address and follow the local development standards and density requirements that we have planned for in our community. We are doing this in response to what has been expected of local governments and the housing crisis to ensure we are having good, strong development.

And we also, as a result of this ability to decrease the density, would provide cities a lot of challenges regarding no net loss. So one of the things that you could have is, if we are planning for 100 units of affordable or of multifamily housing, and a project comes in for a three story townhome project to provide that, and it only provides 75, we're going to have to find 25 other sites within our housing element to stay in compliance with the law.

So we're very concerned about those changes. And then finally, I want to address that this bill would require a by right approval process and a nondiscretionary review of these townhome projects. So we do continue to be concerned. We appreciate all the discussions on this and look forward to reading the amendments, but we do remain opposed today and are happy to answer any questions.

Thank you. Thank you very much. Anyone else in opposition?

Good morning. Tracy Ryan with Rural County Representatives of California. We do appreciate the recent amendments, but we do continue to be opposed.

Thank you. Thank you.

Good morning. Kira Ross on behalf of the City of Thousand Oaks in opposition.

Thank you.

Good morning. Anya Lawler on behalf of the Public Interest Law Project, the California Rural Legal Assistance Foundation, and Housing California. We really appreciate the hard work of the committee on this. We are reviewing the committee amendments, but very likely we'll remove our opposition when those go into print. Thank you.

Thank you.

Good morning. Benjamin Henderson with the Western Center on Law and Poverty. We are evaluating the committee amendments and anticipate moving our position to neutral. Thank you.

Thank you.

Chair and members, Nick Romo on behalf of the City of San Jose. We look forward to reviewing the amendments and appreciate all the work that's been done today. Thank you.

Thank you. Thank you very much. Any comments or questions? Senator Seyarto?

Thank you. When this was up in housing, I supported it. And because from a housing perspective, it makes perfect sense to actually build what consumers have a demand for, as opposed to building what they really don't and hoping that they'll cram themselves in. Right now, we've gotten way ahead of ourselves, way over our skis in small apartment development. We have a lot of those.

In my region, they're building them like crazy. The concern I have here is that while we're trying to force local government to allow development of stuff that people actually have in demand, when they're doing that, they're not going to get credit from HCD for building what's in demand, and they're going to be forced to try to build what's not in demand even more, because we have an agency that's just counting bricks. That's all they're doing. They're just counting rooftops.

No matter what's under those rooftops, whether it's a 250 square foot rooftop or a 900 square foot rooftop or a townhome that's 1,750 square feet.

That needs to change, because otherwise, you know, I want to support bills like this, because I think we're more responsive to the demand. But if we don't change our rules so the HCD can be a little bit more flexible with communities on this, that's going to hold up other stuff. Because I can't go on creating more impositions on cities, and then having an unresponsive agency because we've made rules that they say, hey, we've got to follow those rules, and so we're out. I'm frustrated.

I've tried to work with them, and it's not working. Somehow we have to reel that in. I also would like, at some point, and I can't believe we have to make legislation to figure out what's ministerial versus by right.

But there's a difference, and we need to be able to address that. We need to figure that out so that we can have a ministerial process that makes sense and still give cities some leverage over what's being built and some control over what's being built and how it's being built. Not necessarily the product, but how it looks, how it fits, the infrastructure, all of that. Cities need to have control over that.

And when you're talking by right, they have very little control. And when they have little control, I mean, just go on Facebook and look at some of the comments from citizens. They're talking about what is actually a good project.

They're frustrated. The citizens are frustrated. Eventually, they get sick and tired of this. And they take it out on us, they shoud, we're their representatives.

And so we're not doing them any favors by not addressing this. Today, I'm going to support this because I think it's an example of a project that needs to go forward. But later, we need to address this other stuff with HCD, and the cities and the relationships, and how we accomplish these goals without absolutely obliterating the general plans of cities that are trying to do their best to accommodate this housing shortage.

But we can go from a housing shortage to an abundance of housing and a glut in no time. We've done it before.

And I don't want to put us in that situation, because when that happens, you have a tremendous loss of value and people's financial empires are ruined, because some of it, hopefully at least a third of it, is built on having real estate. So those are my concerns going forward. It's not going to affect your bill today.

But certainly, I think those are things we need to start thinking about if we want to continue down this path, because I am not supportive of leaving our communities out like that. Thank you.

I just want to make a few comments. I thank the author very much and the coalition that you put together. And I hope and continue to rely on the cities to raise the issues that need to be raised, because this has not, you know, we've gone from one extreme to the other and back and forth, and we haven't settled down yet on how to accommodate the city's responsibilities, but also what it takes to carry out that responsibility.

So thank you for hanging in there and keep pushing back. I just want to say, I'm really glad to see ownership at the core of this bill.

That's always something that we should care about, because that's generational wealth that can be passed on to our kids or families, whoever. We had a project started when I was first elected at the 710 Corridor in Los Angeles, and there were hundreds of Caltrans properties that were not going to be used anymore because a stop was put to the freeway. 400 properties owned by Caltrans. What do you do with them? There are many different directions to go.

And we decided, and I'm really glad, even though it's taken some time, to make those open to ownership, make those properties owned by rehabbing them. In fact, we work with Habitat for Humanity. We work with a number of organizations with our formerly incarcerated who are going through their construction trades skills and apprenticeships. Some of them were set aside for rehabbing and then reselling them.

Some were set aside for low income rental, all within filling in a community that had lost those properties.

And now, how do you refill the community with new homes, with new opportunities to rent, with new opportunities to buy? And that had not been done. It was trying to make up for the fact that those properties were sold when they shouldn't have been sold to try to build a freeway. So there are many opportunities if we look at them. I'm really glad that you're raising the idea of ownership and what we can do to streamline the opportunities for homeownership.

I think that's a really great direction to go, so I want to thank the author and the coalition very much for this. And if you would like to wrap up, Madam Quirk-Silva.

Thank you, Madam Chair, for sharing that story, because it does reflect exactly how long it takes to, if you want to say, build as a whole. I remember that project particularly because I was on SCAG as a representative from local government probably fifteen years ago when the 710 came up, and it's taken these many, many years to resolve that. So as much as we try to push and we want to see accomplishments, particularly in housing, we know it can be very slow.

That being said, I'm proud of the work we've done on this bill. We know it doesn't address all the issues. I 100% agree with the Senator, and I think he's from Murrieta.

I do agree with you on the HCD. We need to work on that flexibility, as you've stated, and I think there will be continued work in that area. But with that, I respectfully ask for an aye vote.

Is there a motion?

You know what? I'm going to make a courtesy motion.

Good for you.

That's a sign of good luck. I move the bill? Okay. I can't move the bill. That's right.

That's right. Sorry. Getting all mixed up. Okay. We've got a bill.

We've got a motion.

A bill and a motion. Now we have a vote.

[Roll Call]

The bill will remain on call. Thank you.

Assembly Member Wilson, I think you're next. Okay.

Assembly Member, you are set to go.

Thank you, Madam Chair and senators. First, I'd like to thank your office for working with us on this bill, and I do accept the committee amendments. I'm pleased to present AB 912, a bill that proposes amendments to the Vallejo Flood and Wastewater Districts Enabling Act to modernize the composition of the district's board of trustees and improve governance efficiency, responsiveness, and operational effectiveness.

AB 912 modifies the board's composition to reduce governance conflicts, improve fiduciary independence, and ensures the district can continue to effectively manage long-term infrastructure and service responsibilities. The district's current governance structure presents practical and legal challenges because city council members constitute a majority of the district board.

In situations involving negotiations, litigations, or other conflicts between the district and the city, recusal from one governing role does not fully resolve governance conflicts and often creates quorum issues. The conflicts and quorum issues consistently hold up negotiations on contracts, which further delays projects and necessary agreements for the basic functionality of the district.

Our bill seeks to address these issues by returning the district to a modified governance structure consisting of two Vallejo City Council members, one Solano County Board of Supervisors, and two at large trustees appointed by the remaining trustees. With that, I would like to introduce my witness, Mark Tomko, general manager of Vallejo Flood and Wastewater District.

Thank you. Madam Chair

You have two minutes. Thank you.

Thank you. Madam Chair and senators, I am, Mark Tomko. I'm the General Manager of Vallejo Flood and Wastewater District and, coming to support AB 912. This is also supported by the City Council. It's supported by our unanimously by our board and by the board of supervisors.

So everybody's that's involved is just supportive of it. So this hopefully should be fairly easy. We are a special district. We do wastewater and stormwater. Our current board, as was mentioned, was started in 1995.

It includes eight members, seven of which are the city council and one is the county board of supervisor. The city and the district were completely independent agencies, but that independence gets challenged when the majority of your board is the city council. As as we talked about, the interest don't align. So we have some misalignment of interests, certainly with, as far as legal issues, as far as that clarity and, the privilege concerns and also just dealing with development projects and also getting a quorum.

So this new board that was described a five member board, which is pretty typical for special districts, has the two members of the City Council, one county supervisor and two appointed.

We believe that this will resolve a lot of the conflicts and will actually be more beneficial to the to the the people that we serve. So we're certainly in support of it and hopefully you will as well. Thank you.

Thank you very much. Anyone here in support of AB912? Please come forward.

Good morning, Madam Chair and members. Karen Lang on behalf of the Solano County Board of Supervisors in support. Thank you.

Good morning Madam Chair and members of the committee. Paul Gonsalves on behalf of the city of Vallejo in support. Just like to say thank you to the committee staff for all their hard work on this bill. We really appreciate it. Thank you.

Thank you. Anyone else in support? Seeing none, anyone in opposition to AB 912? Nobody? Anybody in opposition?

Seeing none. Questions or comments? Bill has been moved. You may wrap up.

Thank you. Thank you for all the time spent on this bill, helping us to make sure we got it right. And as General Manager Tomko noted that this is unanimously supported by all parties, the city, the county, and the sewage district. I respectfully ask for an aye vote.

You ought to get this just for all that, getting everybody on the same page. Thank you. Motion has been made.

The motion is do passed to the committee on appropriation. [roll call]

The bill is on call. We'll we'll go on to file item number seven. Assemblymember Carrillo. Good morning.

Good morning, Madam Chair and committee members.

This is item number seven.

Thank you for allowing me to present Assembly bill 1710. I would like to thank the committees for their work on this measure, and I will be accepting the committee's amendments.

AB 1710 is a bipartisan effort to address Californians unprecedented housing crisis, a crisis that has too many people without a home struggling to pay rent and unable to achieve ownership. This bill builds up on the proven success of SB 330 in 2019 by ensuring that once a housing project begins the entitlement process, it is not subject to sudden regulatory changes except for essential updates related to health and safety concerns or to mitigate significant CEQA environmental impact report among others.

Thank you.

As a former city planner, I've seen firsthand how bureaucratic hurdles and inconsistent regulation stall projects for years, driving up the cost and making building housing unattainable. A 2025 study found that California is the most expensive state to build multifamily housing, largely because of the long approval timelines. Projects in California take over twenty-two months longer to finish than in Texas, which greatly increases costs.

If we don't fix our permitting system, we will continue to lose housing investments to other states that offer a more predictable and efficient approval process. A strong reliable housing supply is critical to keeping workers in California supporting local businesses and filling economic growth. Without enough housing, employers face hiring challenges and workers commute become longer and more costly. AB 1710 addresses these challenges head on by increasing transparency, providing certainty, and ensuring fair and timely project approvals.

With me to testify in support today are Nick Cammarota, on behalf of the California Building Industry Association, and Debra Carlton, with the California Apartment Association.

Good morning, Madam Chair and members. I'm actually gonna step in here for a moment with Nick, but there'll be just two of us. But Steve Cruz. Correct. Yeah.

On behalf of the California Building Industry Association. And, thank you to the Assembly member for \ authoring this important bill for CBIA. I know we're gonna accept amendments today as the author indicated, to narrow the focus of the bill to Section two, and I just wanna make a few comments on that.

That is, still an important part of the bill that would make adjustment to the reasonable person standard and, the ensure that public agencies, when they're assessing projects for consistency, that there are objective standards that they may comply with. And so we're we're grateful that we are able to move forward with those provisions intact and would ask for an aye vote.

No. He covered it.

Just here for questions if you have them.

Thank you. Anyone else in, support of AB 1710, please come forward?

Madam Chair, Michael Gunning here on behalf of SPUR, Abundant Housing Los Angeles, and Circulate Planning and Policy, all in support of AB 1710.

Thank you.

Freddie Quintana on behalf of the California Apartment Association in support.

Thank you.

Good morning, Chair members of the committee. Jordan Panana Carbajal, on behalf of California YIMBY, in support. Thank you so much.

Thank you.

Madam Chair, Bob Naylor for Fieldstead and Company in support.

Thank you.

Good morning. Henry Reinen, on behalf of Lieutenant Governor Eleni Kounalakis, in support.

Thank you.

Harrison Linder on behalf of LeadingAge California here in support.

Thank you. Seeing no more in support, anyone here in opposition to AB 1710? In opposition?

Thank you, Chair and members. Anthony Tannehill with the California Special Districts Association. We had an opposed unless amended. Looking forward to seeing these amendments in print and reevaluating, and want to express our gratitude to the committee, the author, and all the stakeholders for engaging with us all of these months. Thank you.

Thank you.

Good morning. Kylie Wright with the Association of California Water Agencies. Also want to appreciate the author and the committee's work on this bill and the amendments that were taken today. Looking forward to reviewing the bill in print and reconsidering. Thank you.

Thank you.

Hi. Good morning. Keeley Morris on behalf of the California Municipal Utilities Association. We are respectfully opposed unless amended. Thank you.

Thank you very much. Nobody else, come to the dais. Any comments or questions? Questions, Senator Seyarto?

Thank you. So the opponents of the bill right now are asking for the amendments. Are the amendments that are you're that are pending, are those do those address their concerns, or is there more work to be done?

That is my understanding that those amendments will address their concerns. That's my understanding, but I don't know if there'll be other concerns after they see what's gonna be in print.

Okay. Alright. Very good. I'll move the bill.

Any other questions or comments? Seeing none, the bill has been moved. We're ready. Oh, close it.

Madam Chair, this bill is designed to bring consistency and certainty to the house and approval process. I respectfully ask for an eye vote. Thank you.

You're welcome.

The motion is do passed as amended to the committee on appropriation. [roll call]

The bill is on call. Thank you very much. Anyone here?

Cool. Need a a motion for the consent calendar? Consent calendar. Bill has been moved by Senator Cervantes.

[Roll Call]

On call. We don't have anyone. We're going back to AB 306, and I need a motion for that, please. The bill has been moved by Senator Cervantes. Call the roll.

[Roll Call]

Bill is on call. Waiting.

We have Assembly member Johnson. Yes. Ready?

Good morning. Good morning. Welcome. Assembly member, we're going to hear about AB 2080. Go ahead and make your presentation.

Good morning, Madam Chair and committee members. I'm here to present AB 2080, a straightforward measure intended to improve local government efficiency and remove unnecessary administrative burdens. Under current law, county board of supervisors must go through formal renewal process every single year to delegate investment authority to their county treasurer. This creates a reoccurring admin0istrative hurdle that serves no practical oversight purpose, but carries significant technical risks.

In many cases, simply scheduling delays or agenda backlogs can cause this once a year period to lapse, putting the county in technical noncompliance with the law.

This uncertainty can impact not just the county government, but also the school districts and special districts that rely on county investment pools. AB 2080 fixes this by shifting an annual renewal model to an ongoing delegation that remains in effect until the board chooses to revoke it. The bill is sponsored by the California Association of County Treasures and Tax Collectors and has received bipartisan support and no no votes.

It's a very common sense fix that provides stability to local investment operations while maintaining a very straight well, strict board oversight. With me to testify is Karen Lange on behalf of the California Association of County Treasurers and Tax Collectors.

Good morning. You have two minutes.

Great. Good morning, Madam Chair and members. Thank you so much for hearing the bill, and thank you so much to the author for taking it on. As she outlined to you, this is really a technical change where the delegation will occur. And then when a board of supervisors feels as though, maybe something's not quite right, they can have a hearing and potentially redesignate the authority to themselves.

But doing so will provide all of the stakeholders in the county treasury an opportunity to participate. While we hold a lot of money for ourselves in county treasuries, we also have the special districts money and a lot of local schools' dollars, and those folks are also stakeholders in the management of the county treasury.

And occasionally, when a board or a tax collector might not get it on the agenda in time before the end of the year, Technically, that responsibility falls back to the board of supervisors, and nobody wants to be out of compliance. So this actually tightens that up, but also gives the public an opportunity to participate in any revocation of an investment authority. All of these changes were made in the nineties after the Orange County bankruptcy.

I see we have two members on the committee that represent Orange County. We're not doing anything to, dilute or diminish the reporting that must be done on a monthly and quarterly basis as far as where the money is and how it's performing. So we're not doing anything from a public access standpoint. We would never, come here and ask Jonathan to analyze a bill that would do that. He's been wonderful to work with.

Your staff has been fabulous, working on another bill related to investments, and we are, very mindful of the the the committee's dedication to making sure that money is managed appropriately. And we ask for your aye vote, and, again, thank the author for taking it on.

Thank you. Anyone, else in support of AB 2080 please come forward? Okay. Seeing none. Do we have anybody in opposition to AB 2080?

Anybody in opposition? Seeing none. We have questions or comments at the dais, members? Move the bill. Alright.

Bill has been moved. Would you like to wrap up?

Thank you. I just respectfully ask for your aye vote on AB 2080.

Thank you very much. Go ahead.

The motion is do passed to the Senate floor. [roll call]

Bill is on call. Thank you very much. And as soon as we get our more of our members, we'll take up the vote. Assemblymember Zbur, I think you have two bills. We'll start with AB 1740.

\Good morning.

Good morning, Madam Chair and members. Thank you so much fo(r allowing me to present AB 1740, which is sponsored by the city of Santa Monica and Streets for All. I want to first begin by thanking every stakeholder who has worked tirelessly with me to get this proposal to where it is today, including the committee chairs and incredible committee consultants in a variety of committees in both houses.

I'd also like to thank the bill sponsors for their tireless advocacy, and additionally, my sincere thanks to the Coastal Commission and Coastal Commission staff. I'm also happy to be joined today by my friends in the environmental community.

I've worked hand in hand with these groups for decades and will continue to work with them to fight to protect our beautiful, vibrant, and delicate California environment and coastline. The California Coastal Act of 1976 was a landmark policy achievement in the fight to protect and manage California's 1,100 miles of precious vibrant coastline. The historic law balanced resource and ecological protection, coastal access, and economic vitality, and its passage marked a critical inflection point in California's commitment to defending our priceless coastline.

This bill has always been one whose intention was to advance and protect the policies of the Coastal Act. As as originally introduced, it intended to advance pedestrian enhancements, housing, and visitor serving uses in the coastal zone in areas that are highly urbanized and in which there are not other coastal resources present.

Therefore, the goal was to advance good community projects and at the same time protect the things that the California public cherishes like clean water, our beaches, wetlands, species, and habitat. Achieving these goals in a policy proposal is complicated, and we understand why there was so much focus around this bill.

When AB 1740 was introduced earlier this year, it proposed targeted exemptions from coastal development permit requirements for a specified type of urban transit rich and coastal city that met standards around public access transit and greenhouse gas reduction. Santa Monica, in my district, is among the most transit rich and multi multimodal cities in the coastal zone. It also remains one of the only coastal cities without a certified local coastal program.

The earlier versions of AB 1740 were vetted, and the feedback we received fostered a subsequent extensive and collaborative process among the Coastal Commission, the City of Santa Monica, and environmental housing and mobility advocates. These conversations over the past months have led to the city of Santa Monica and the Coastal Commission reaching an agreement that puts Santa Monica on a path to a certified local coastal program.

Several weeks ago, after decades without a local coastal program, Santa Monica and the Coastal Commission agreed on a memorandum of understanding to guide LCP negotiations with both sides saying completion within eighteen months is feasible. Santa Monica City Council voted seven zero to approve the MOU on May 26. Developing and mutually agreeing on an MOU for an LCP is almost unprecedented, and it is a testament to the reinvigorated energy and willingness of all parties to see the city granted a certified LCP.

Once certified, a local coastal program will allow most coastal development permits to be processed by the city, rather than requiring separate coastal commission approval, creating a more predictable and locally controlled process while maintaining the commission's traditional mechanisms for oversight in the coastal zone. So this bill, consistent with the agreement to, quickly move forward with an LCP, AB 1740 now provides clear timelines, accountability measures, and reporting requirements designed to ensure that an LCP for Santa Monica is completed and implemented.

AB 1740 concurrently provides for smart climate strategies by giving the Coastal Commission new tools to support investments in transit, bike lanes, and pedestrian transportation across the state by creating an expedited statewide permitting process within the Coastal Commission's jurisdiction for bike, transit, and pedestrian projects. This process eliminates requirements for traffic studies and empowers the executive director to waive permit requirements if she deems the project provides commensurate and enhanced public access to the coast.

The bill also requires the Coastal Commission to publicly report data on the approvals of these projects, providing transparency to the legislature and the public.

The bill before you today represents a win-win-win approach and rewards a good faith effort between the Coastal Commission and the city of Santa Monica, which is why I'm happy to hear that the Coastal Commission will be agendizing this bill for their July hearing in order to consider taking a formal position of support. They've already removed their opposition.

This bill brings both parties to the table and supports the city of Santa Monica in certifying an LCP that will preserve the California Coastal Commission's traditional authority and ability to protect our beaches and coastal resources from activities that threaten sensitive habitats. Madam Chair, I'm happy to accept the two amendments outlined in the committee analysis when being technical, the other removing reference to ATP funding. I ask for your aye vote at the appropriate time.

And with me today in support of the bill, I'd like to introduce Sylvia Solis Shaw, representing the City of Santa Monica, and Laura Deehan, state director for Environment California.

Yeah. Go ahead. You have two minutes, madam. Go ahead.

Thank you, Mister Vice Chair. Good morning. Sylvia Solis Shaw here on behalf of the City of Santa Monica. Our coastline is central to our community's identity, economy, and quality of life. Many of you are familiar with visions of the pier, and just our very, very vast coastline and beaches.

For decades, Santa Monica has been a leader in environmental stewardship, sustainability, and public coastal access, and we remain firmly committed to those goals. The city sponsored AB 1740 to address long standing permitting challenges in urban coastal communities, while also preserving strong environmental protections and public access.

We are very appreciative of the collaboration among Assembly members of Byrd, the Coastal Commission, our cosponsors, and other stakeholders to for getting this bill to a consist consensus based framework that creates a clear path towards certification of the city's local coastal program. Without the LCP, the city has faced permitting delays that can hinder projects that improve mobility, public access, sustainability, and economic vitality. Goals that are not only local, but statewide goals as well.

AB 1740 establishes timelines and accountability measures that will help the city complete its LCP while preserving the commission's oversight, authority, and strong coastal protections. We ask for your support of this bill.

You have two minutes.

Thank you, Vice Chair and senators. My name is Laura Deehan. I'm the state director for Environment California. We're a statewide environmental advocacy group that works for clean air, clean water, protecting our open spaces and beautiful coastline, and making sure we have a livable future for all of us. And we are really pleased to be able to support AB 1740.

We are very grateful to Assembly member Zbur for working with coastal groups, the coastal commission, and others to address the concerns with an earlier version. And the version here before you today has no exemptions to the Coastal Act, and it really helps encourage the city of Santa Monica to be able to make those local decisions through a local coastal program that they need to make. We also support the provisions to encourage walking, biking, and public transit use to be able to get to the beach.

And we really appreciate the Assembly member's commitment to the environment that he's shown with these changes in the bill and with other bills that we've gotten to work with him on as well. The Coastal Act really is a bedrock environmental protection that the public supported fifty year over fifty years ago, and we wanna make sure that we continue to keep it strong so that our coast stays beautiful.

And we respectfully ask for an aye vote.

Thank you. Any other, support in the audience? State your name and, organization and your position.

Sure. John Scoglin with the County of Los Angeles in support.

Stephanie Jimenez with Housing Action Coalition in support.

Shanta Bacon with the California Downtown Association in support.

Okay. Any lead opposition group? Anyone in the audience? Okay. I would like to ask our members.

Any questions? Okay. Motion has been made by Senator Seyarto. I have a simple question. Your bill summary says basically a very simple local Santa Monica's local coastal program will be developed and will be submitted to coastal commission, and the coastal commission shall follow the timeline as specified.

With this bill, without the bill, what what they will do their their job? What does your particular bill will achieve by enacting this bill?

So, Santa Monica is one of a handful of jurisdictions that doesn't have a local coast a certified local coastal program, and it's been after decades of actually going back and forth, trying to develop one. So, yes, there are timelines. So this doesn't change the standards, that the Coastal Commission needs to apply for coastal program. They will apply the existing laws.

What it does do is it sets up a process by which both the city needs to submit an application for a coastal program, and if they don't meet, you know, they're not required to do that now.

And if they don't meet that, then

Has they submitted the pro program plans?

They they have in other years. And I think the last time they submitted one was in 2018, I believe. 2018, and then the Coastal Commission asked them to withdraw the pro to withdraw the application, because they there were differences and they didn't have the resources to move it forward quickly according to their the timelines that the Coastal Commission needed to follow. So at that point, it sort of stalled the process, and then COVID came, and now it's sort of stale.

So now they're gonna have to submit a new application for a coastal program, which requires city processes to develop that so that it has the appropriate public input.

So but the city has committed the resources just to go through the city process to prepare the application in a certain amount of time. If they don't do that, there's transparency provisions in the bill that require the city to explain why that hasn't happened. The Coastal Commission then has to process it within six months. That's actually faster than the normal time period. It's with it's not waiving anything, but, you know, that's typical that's faster than what they typically would do.

So the Coastal Commission has agreed to devote resources to get that done. If they don't accept the application, they've got to report wise to the legislature. So there's a bunch of transparency things that don't reduce the Coastal Commission's authority or change the law, but really requires both parties to really focus on this and get it done as quickly as possible.

While this plan is being developed, is the city of Santa Monica coordinating with the commission for that that they once this application has been submitted, it'll go smoothly according to the timelines?

Yes. And thank you to the Assembly member and to leadership in the city. We are working collaboratively with the commission so that we stay on track.

Okay. With the motion made, the Senator, would you like to close

Again, I just I wanna thank the the bill, the bill cosponsors, City of Santa Monica and Streets for All who's devoted a lot of energy to this because of the bikeway and pedestrian focus that they have. And I also want to thank, really all the the Coastal Commission staff. I think they really deserve a lot of credit.

They spent a lot of time with us, negotiating both with the city of Santa Monica on the MOU and and with my office to sort of support that with the bill, and then with our partners in the environmental community who've been so focused on this bill and I think, you know, have been, you know, doing their job to really protect the coast. And I just wanna thank them for working with our office.

Thank you. Okay. Motion has been made. Clerk, please call the rolls.

The motion is do passed as amended to the committee on appropriations. [roll call]

You have another bill while you are here, bill number AB 2181. When you're ready ready, you can go ahead.

Mr. Chair, Members. First of all, I want to thank Madam Chair for her attention to this bill as well as being a principal co-author of the bill. I know she's not here right now, but I'd like to thank her. I'd also like to thank the committee staff for the work on the bill. I'm proud to present AB 2181, which is co-sponsored by Unite Here International and Unite Here Local 11.

AB 2181 is a narrow clarification that ensures that density bonus potential can only be used in valuations for hotels and motel or motels when it is real, approved, and vested. It simply ensures that ground lease rent resets reflect reality, not speculation. This is a pro housing bill that promotes and protects density bonus law, which is one of the state's most important tools to incentivize affordable housing.

The bill does not change or limit density bonus eligibility in any way. Instead, it protects the integrity of the policy by ensuring that benefits are tied to actual housing production. This bill addresses a real problem that has emerged. Appraisers are using hypothetical residential development scenarios to inflate land values when no housing development is planned or contemplated.

Density bonuses that have not been pursued or approved are often used to inflate property values, and that inflated value is then used to reset hotel and motel lease rents, creating real financial consequences impacting existing businesses and workers, especially in the hospitality industry. For example, I have a fully operating hotel in my district supporting jobs and tourism.

It has a long term ground lease that makes redevelopment of that parcel now infeasible for decades. No housing project is proposed or approved. It could be done because of the ground lease. Yet appraisal, the appraisal assumes high density residential development using the density because of the density bonus law.

No housing is being built, but the idea of housing is driving real consequences such as worker job, potential worker job loss, reduced tourism activity, and pressure on long standing productive land uses. The state is appropriately expanding density bonus tools to increase housing production, and new policies like higher density thresholds or double density concepts increase theoretical development capacity.

However, without guardrails, that expanded capacity can be misapplied in appraisal scenarios and used to further inflate land values based on hypotheticals. AB 2181 provides a simple guardrail where density bonus can only be pursued in valuation when it is pursued, approved, and vested.

That will ensure that housing incentives remain tied to real projects and valuations reflect legally permissible realistic conditions. The bill is narrow in scope and intentionally is focused on hotels and motels. This is where long term ground leases are common, redevelopment is often constrained, and impacts are most acute. To be clear, this bill does not restrict housing development.

It does not change the density bonus law, and it does not prevent future development. This is a technical fix with real world impact. This it protects hospitality worker jobs. It prevents speculation speculative valuation processes and keeps housing policy tied to actual production. I ask for your aye vote at the appropriate time. And with me today in support, I'd like to introduce Laura Strand, consultant representing Unite Here Local 11, and Maria Espinoza, member of Unite Here Local 11 and a housekeeper in the City of Santa Monica.

Each person will have two minutes.

Good morning, Honorable Acting Chair Choi and Members. Laura Strand representing Unite Here Local 11 on behalf of more than 32,000 hospitality workers across Southern California and Arizona. We are proud to co-sponsor with Unite Here International, AB 2181, Zbur, and respectfully urge your support for this bill.

This bill is about preserving commercial uses of property that are critical of California's economy. Hotels and other hospitality businesses provide thousands of good paying jobs, union jobs. They generate significant economic activity, and they help sustain California's vibrant visitor economy.

This bill seeks to close a loophole that can put these businesses and jobs at risk. Fundamentally, AB 2181 is in alignment with two other Unite Here Local 11 and Unite Here International Union co-sponsors bills from last year, SB 838, Durazo, and SB 92, Blakespear, which went through and were both signed by the governor in 2025.

These bills are principally about making sure that housing laws are being used for housing purposes, not just for the creation of good housing, which, of course, we deeply support, but also because the clarity of rules ensures no gamesmanship and a clear playing field. We thank Assembly Member Zbur for his leadership on this issue, and we respectfully request your aye vote on AB 2181. Thank you.

The second person.

[Translated]

Good morning. I'll be translating for the witness. My name is Maria Espinoza, and I work as a hotel housekeeper at the at a hotel in Santa Monica, California for over 22 years. I am a proud member of Unite Here Local 11. Every day, I clean rooms, turn over beds, and make sure guests have a good experience.

It's hard work, and it's work that keeps our hotels running. But too often, the people who do this work, the housekeepers, the servers, the front desk staff, don't have a real voice in the decisions that affect our jobs and our workplace. That's why this bill matters. AB 2181 is about making sure that the hospitality industry works not just for owners and investors, but also for the workers who keep it going every day.

It's about fairness, respect, and making sure that when decisions are made, they don't come at the expense of the people on the ground. For workers like me, stability matters. Fair treatment matters. Knowing that our jobs are protected and that our work is valued, that matters. This bill helps move us in that direction. It recognizes that hospitality workers are essential to California's economy and deserve to be treated that way. I'm proud of the work that I do. I just want to know that the system we work in supports us too. I respectfully ask for your support on AB 2181. Thank you.

In support of this bill, just your name and position.

Madam Chair, Member. Sara Flocks, California Federation of Labor Unions, in support. Thank you.

[Translated] Good morning. My name is Andrea Herrera. I am a housekeeper at a hotel in Santa Monica, California, and a proud member of Unite Here Local 11. I support AB 2181. Thank you.

Good morning. Delilah Clay on behalf of the California Hotel and Lodging Association in support.

Okay. Any, lead opposition witness? Any me too opposition in the audience? No. Then questions from the Members. Okay. Motion has been made. Okay. No other question, then you can close the your statement.

Again, I wanna thank Unite Here International and Local 11 for stepping up to protect their workers from risks that are out there due to density bonus law. I wanna thank Madam Chair for being a a co-author of this bill with us and working with our office. And with that, I respectfully ask for your aye vote.

Okay. Motion has been made. Clerk, please call the roll.

The motion is do pass to the Senate floor. [Roll Call]

Thank you.

The bill will remain on call. Who's next? He ran out. Wait. Wait.

Okay. Member Pappan, you're next. This is a B2469.

Two before you this morning.

2469 And2 619.

You got it. Okay. Okay. Thank you, madam Chair. Delighted to be with you.

So I've got two bills that are related this morning to data centers and the water that data centers use. The first bill, I call the get the info before you break ground bill. So given the focus of this committee being local government, I I wanna focus my remarks on what this bill means for local governments.

And in this regard, with the chair's permission, I'd like to read just a couple exemplars of what public comment is looking like out there in local governmental hearings and what we find, local government officials having to grapple with as it relates to data center proposals that are coming before them. So in in Imperial, we heard the following.

And I quote, this project does not exist in isolation. It impacts real neighborhoods, families, and schools, and is also setting a precedent for how you treat your constituents. The other one, same hearing, said, if the full scope of this project cannot be clearly presented and independently verified, then residents are essentially being asked to make decisions without the information that they deserve. And that's what these bills tried to get at.

So I could go on and on and on about different this is very prevalent in the press these days, but this really is unlike anything municipalities have seen before.

And we find that localities are asking the following questions, and they're very fundamental. Do we have enough water now? Will we have enough water in a drought year? What are the long term impacts on our community? And what is the cost to our community?

Responses to these inquiries is where this bill, AB 2469, comes in. The bill will create a consistent baseline so every community, large and small, starts with the information that it needs prior to making a decision on a data center. Because permitting isn't the same in every city statewide. The information about data centers and water and their water use is not always collected, or is it always complete?

What we're seeing is that local governments often have to negotiate for fundamental facts on a project by project basis.

And now we're seeing that when a locality can't get the information they need, they're just banning data centers altogether. So let's get into the particulars of the bill and how it works. The bill has two major components. The first is the amount of water. The bill requires a water supply assessment before project approval, where a project proponent provides information about its project needs, and then the water supplier determines whether a reliable and sustainable water supply is available to serve the project.

The second component of the bill is about the cost impacts on the community. It ensures that if additional water infrastructure is needed to serve one of these large facilities or if existing infrastructure must be expanded, those costs must be borne by the project and not existing rate payers. Members, this bill is about informed local decision making for long term water impacts. It's about transparency, and it's about protecting rate payers.

With me today, I have Eric Massenet from UC Santa Barbara and Sean Bothwell with the California Coast Keeper Alliance.

We'll start with Mister Massenet professor Massenet, I should say.

Perfectly fine. Thank you so much. Welcome. Welcome.

Good morning. And I just wanna remind you you have two minutes each.

Two minutes. Thank you. Thank you, madam Chair. My name is Eric Massenet, and I have conducted research on the sustainability of data centers for two decades. Thank you to the committee for the opportunity to speak with you today.

As I mentioned in my testimony for the original bill, the rapid expansion of data centers can pose risks to local water supplies, especially in times of drought. But with intelligent planning to reduce those risks, our state can achieve its economic and digital leadership goals while simultaneously protecting the state's water resources.

But such planning will require some basic data, particularly the quantities of water that will be required at specific locations so that local stakeholders can make informed decisions, the expected peaks in water demand that can occur so that proactive measures can be taken to avoid supply stress, and basic information on the cooling strategies at specific sites that will lock in water use for years to come.

I'd like to point out that such data not only help us better plan for the data centers being built today, they will also drastically improve the state's ability to make forecasts that are critical for identifying strategies that balance water stewardship and economic growth in the future. So why not rely on voluntary disclosures?

While all companies have the needed data in hand, only a tiny fraction has actually shared them voluntarily. In fact, only Google and Meta report the water use of individual US data centers and only after those data centers have been built and are operating, which is when water use has already been locked in. Therefore, expected water use remains a major blind spot for planners. In my view, disclosing expected water use poses no major confidentiality risks. Companies routinely tout the water efficiency and advanced cooling capabilities they have.

Upfront assessments would merely ask them to back those claims with transparent data like we would for any other sector. In some, requiring upfront assessment seems like common sense is a must for sensible planning and is most certainly in the best interest of California citizens. Thank you for your time and I'd be happy to answer any questions you may have.

Thank you very much. Go ahead.

Morning, Chair. Committee be committee members. Sean Bothwell. I'm the executive director for California Coastkeeper Alliance. We really see this bill as a transparency bill to protect rate payers.

Our communities' water supplies portfolios are already built out and are constrained statewide. Right? We're already looking for where can we get more water, And yet these data centers are coming in and putting new pressures on our communities, and these communities should know before the data centers are built what type of pressure that is. Now some of these data centers are, you know, using non potable water, recycled water. That's all great, but that's water's already been spoken for.

We have already set policies in this state to recycle all of our recycle all of our wastewater that's feasible to be recycled. We need to do that because of climate change. The governor has made proclamations. The water board has set goals. That water has spoken for.

And so when we have new demands on the system, those communities should know about those demands and be, you know, transparent about it before going in to building these centers. The bill also requires these data centers to be responsible for any new infrastructure that's required because of their strain on the system. And that's important because without that, that these data centers can just walk away and leave the rate payers on the hook for those stranded assets, which is not fair to the rate payers.

And then lastly, the definition of CII, we need to look at CII facilities different, than we do other CII or we need to view data centers differently than other CII customers because data centers use water consumptively. Meaning, when they use it, it goes away.

It doesn't go back in the system. It's not able to be recycled. It doesn't go downriver to the next community. It's gone. And so we need to look at those facilities differently than we do other CII classes.

With that, I'll ask for your aye vote. Thank you.

Thank you very much. Anyone here in support of AB 2469?

Good morning. Kyle Jones on behalf of the Community Alliance with Family Farmers, Resources Renewal Institute, California Water Impact Network, and Restore the Delta in support. Thank you.

Thank you.

Remi Velakis with the Planning and Conservation League in support.

Ashley Walker with Nauserman on behalf of Santa Clara Valley Water District in support.

Thank you.

Marissa Hagerman with Traton Price Consulting registering support for California environmental voters. Thank you.

Gabriela Fazio with Sierra Club California in support.

Thank you. I I just wanna check, Assembly member if you accepted the amendment.

Yes. Okay.

Thank you, madam Chair.

Thank you. Okay. Anyone here in opposition to AB 2469? Please come forward. Thank you.

Good morning. And you have two minutes each.

Great. Thank you, madam Chair and members. Chris Anderson on behalf of the California Chamber of Commerce. Okay. A little closer?

California Chamber of Commerce, respectfully in opposition. I'll I'll note if there are committee amendments, we we haven't seen them. So, you know, we'll basing my comments off of the bill in print. You know, I wanna first start off by discussing the bill's mandate that data center operators pay the quote unquote full cost of infrastructure necessary to service their facility.

Yes. Great.

As the committee analysis noted, water agencies assess connection fees and capacity charges whenever a facility is connecting to a water system. And that those fees reflect the proportional cost of the infrastructure necessary to service the facility, and those fees can also be used to purchase additional water supplies if necessary. The constitution and the mitigation fee act, again, mandate that these costs are proportional.

I'll also note that the mitigation fee act details the formula agencies must use in assessing costs, provides a public process for adopting these fees, mandates separate accounting, and spells out an appeals process if these fees are to be challenged. This provision doesn't do any of that.

There's nothing about this provision that's particularly useful to a water agency. At best, this provision is redundant of existing law, and therefore unnecessary, and at worst, it's creating a new and unconstitutional standard. You know, I'll also note that it gives DWR a role in assess, determining these fees. DWR plays no role in assessing the fees of local water agencies, so it's very unclear why this why they would be given a role here.

You know, the other thing I'll note is that the proponents describe this as an information seeking bill, ensuring that these facilities have sufficient water supplies before being permitted.

Between water supply assessments, connection fees, and capacity charges, urban water management plans, existing law already requires supply demand assessments, both for individual projects and based on long term planning projections. So it is unclear exactly what gap this is this bill is filling. So for these reasons, I'm more respectful ask for your no vote.

Thank you. Go ahead.

Good morning, Chair and members. My name is Ashanti Smith on behalf of the Silicon Valley Leadership Group in respectful opposition to AB 2469. We appreciate the committee's focus on water stewardship and thoughtful planning for California's growth of data center infrastructure. And this is an important conversation that we wanna be constructive on. Data centers are critical infrastructure.

They support the health systems, university systems, medical research, financial services, emergency government, operations, artificial intelligence, and the broader digital economy that Californians rely on daily. Unfortunately, as amended, AB 2469 built a separate regulatory framework around a single industry without giving a state comprehensive picture of statewide, water demand or how that demand should be managed across large water users. We have three primary concerns with this bill. First, this is a permitting bill, not a disclosure bill.

The amended version bars, and and when I say amended version, we haven't seen the most recent amendment, so I'm talking about the bill in print.

Bars a city from or a county from approving a data center through discretionary or ministerial permit, unless the applicant satisfies a list of preconditions. A water scarcity plan, a water supply assessment, and a water use assessment. Because it reaches ministerial approvals, it overrides even by right projects that today move forward without discretionary review. That is a citing an approval mandate and not transparency. Second, it ignores the real operational trade offs in modern data center design.

Water use, energy efficiency, cooling technologies are all balanced against one none one another, and against local grid and climate conditions. A facility that reduces water use often increases energy use and vice versa. On top of that, the amended bill forces an applicant to assume the full cost of conveyance treatment storage or distribution upgrades as determined by DWR, or the water supplier with no cap or no cost sharing framework, creating an open ended and unpredictable liability.

And third, it creates an unavoidable risk to privacy, security, competitiveness, and California's digital infrastructure. Detailed facility level water siting, and workforce information can expose competitively sensitive and security relevant details about where and how critical infrastructure operates.

And the added cost and approval uncertainty will push investment to other states that are actively courting it. SBOG supports transparency, innovation, and responsible resource management. California can advance smart water policy and continue to work on infrastructure. And for those reasons, we respectfully urge your NOVA.

Thank you very much. Anyone else in opposition to AB 2469?

Good morning. Tracy Ryan with the Royal County Representatives of California. We have an opposed and less amended position on the bill. We look forward to reviewing the amendments as outlined in the committee analysis. Thank you.

Thank you.

Good morning. Charles Delgado, California State Association of Counties. Opposed unless amended on the current version of the bill. We look forward to seeing the amendments put forward, by the committee, and I'd also like to thank the author, and their staff for working with us on this. We look forward to continuing the conversation.

Thank you.

Leila Romero on behalf of the League of California Cities, and we are opposed unless amended, but we look forward to reviewing the committee amendments when it comes into print. Thank you.

Good morning. Timothy Byrd junior on behalf of TechNet and the data center coalition in opposition. Thank you.

Thank you. Okay. Seeing no more no more witnesses in opposition. Bring it to the dais. Questions or comments?

Senator Choi? Thank

you, Chair. I have a number of technical questions. Whoever who has knowledge about that, you can answer. Obviously, in the era we are living in, technical technical advancement and the data center need has risen recently so rapidly. And so they need to build somewhere data centers, but, obviously, the problem is what I hear is that a lot of water usage.

And I basically questioned myself, why is that the matter? The water cannot be reused, but from the opposition witness, what I hear is that that that's not reusable. So once the water is used, is that contaminated? To my knowledge, common sense and knowledge is that water is used to cool the system. Nothing no chemical added.

So it will be if this is the machine computer, it'll pass through, cool the machine, and go down and let it stay for an hour or two hours of when it's cooled, it can be recycled. It's not possible, and why not? That's my first question. Number two is that if this is contaminated, where does the water go? How harmful it is?

Is it retreated? If that's the case, then fortunately, in California, we have a lot of coastal region where data centers can go. Why not build in the coastal area where nobody is using rather than farmland as we hear the shortage of water. So if you can answer these two questions first.

Senator Choi, who do who are you addressing the question?

Anyone who has knowledge about that.

If I may refer to one of my witnesses.

Absolutely.

Perfect question. We'll get it answered for you. Take it away, Sean.

So there are technologies out there that can reuse the water. It's just a question of whether the data center is using it or not. And I think we're actually gonna get to that in the second bill because there are advances we're looking at, you know, setting best practices. Those have not been set in California yet. And so some data centers, the majority that I know, use the water once.

And it's not necessarily about water quality. It's more that just dissipates. So, like, a power plant, when you run the water through, it evaporates out into the atmosphere. It's not that it's necessarily contaminated. Now these technologies and I'm not an expert on all the technologies, but I I I have a fairly decent background on, like, one stoo cooling and and some of the technologies alternatives to that.

So there are dry and wet, cooling systems that reuse the water. And my understanding is, particularly for the the the wet cooling systems, you use them, you keep reusing it, and as it condenses, the whatever the water quality was just gets more, acute. And so you do need to, retreat the water after so many uses. So so there is a water quality piece for those alternative technologies. It's more of a question of whether they're using the technologies in the first place.

And, again, that's what I think the second bill is gonna speak to towards. But our issue is the ones that are consumptive where it just evaporates out into the the air, then When you present? That's my understanding. Yes.

So what we understand is that many of them can recycle for several cycles, but round about the seventh cycle, the water is gone. So that's why they're what we call a a an ultimate consumptive user. And so it is very important to know at the outset

So really surprising to hear the cooling, the water water sys water, passing through the system just because of the intensive heat, I believe, is evaporates rather than passing through. I mean, there should be better technology to, let it pass through a more speedy way so that the water before water evaporates, it can be recaptured, then the cool, then the recycle rather than sitting there for a long time. So that's my another question, if you can if your professors may have answers to that.

And number two is that cooling methodologies fan can be another way of doing it. I don't know whether the fan will cool the system cool enough for it to operate.

So, obviously, that's not the case. That's the reason the water is used. Can you comment on that on that?

I'm sorry. Did you want to respond to that?

And then and then you can go back to

I I I just wanna briefly speak to I mean, some of the members that SBOG has, that are data center operators and builders here in the state of California are constantly in an innovation cycle, where they are making their servers more efficient, where they are able to run at higher temperatures without needing cooling systems.

So for most of the time, you're talking about servers who are not needing that additional water that is like pumped over to cool them, because they're being able to operate at higher temperatures. And then they are cooled off rather quickly to go under that ambient temperature of roughly around 85, degrees Fahrenheit.

So not only are they continuing to use less water because they're making more efficient, cooling systems, but they're also making more efficient, servers that are able to run at higher temperatures, rather than, like, constantly, cooling. So you have the recyclable, nature of the water that is actually being used in these facilities, and then there is quite a bit of innovation in the technology themselves that allow them to use less water.

And that was a part of a report that quite a few of our, facilities had put out recently. So I just wanna add that.

Thank you very much. Yeah.

Yeah. I I have one following question.

Yeah. He had his hand up. He wanted to answer the question.

Okay. Yeah. I'll I'll try to be very brief. So I think the best way to think about water use in the data center is to recognize that there are generally two loops. The first loop, if water is used to cool the servers, is a closed loop.

The water just recycles. That's what removes heat from the servers. It doesn't evaporate. It gets warm, and then that heat has to be rejected from the building. That's where evaporation comes in.

That second loop, which is also water based often and running through cooling towers, will evaporate some of that water into the atmosphere to take the heat with it. When that happens, as Sean mentioned, the minerals, some of the treatment chemicals, and the remaining water get concentrated. So you do have water discharge from evaporative cooling systems at data centers, and by and large, that goes into the way wastewater treatment system.

Okay. So that means, you are saying that's contaminated. That's not good.

Well, it's it's the same sort of discharge one would have at an office building or a warehouse that's using cooling towers. It's pretty standard. We've been using these technologies for, you know, many, many years.

Or the water is discharged,

are they treated? It's possible to to treat the water and recycle it, or it's possible to discharge it as long as it doesn't Doesn't

it have to be mandated to be treated before It could be, but

you can also discharge water that is within the limits of the wastewater treatment system. So there are many different options that data centers have. I just wanted to clarify on the nature of the water use itself and the discharges.

Okay. I have a question. The point

that we're trying to make is there are multitudes of systems that different users and data centers employ, And the purpose of this bill is to make sure that localities can be prepared to provide enough water so that these data centers can succeed, whichever technology they might be using.

Okay. I have another question to the author. Now your bill is prohibiting cities and the counties not to issue any permits.

No.

If that's the case, to me, cities and oh, I don't know why somebody's listening. The cities and the counties where the data center will be located will know much better than any outsiders whether water supply is sufficient for that area. So why not let the cities and counties determine final approval of the data center, and you are prohibiting that. That's my quest quest question. And the second one is that if you prohibit local governments to make their decision approval decisions, then who's gonna approve?

Or is it gonna be state agency newly newly formed?

So, actually, it is quite the opposite. The localities will determine whether or not to permit. All this bill does is say, you must you, the applicant, the data center developer You

will say

must provide the information so that a permit can be issued. We are agnostic about what will work for a particular water supplier. They'll have to determine for themselves. You know, in the state of California, it was something like 3,500 different water suppliers. This is a very local issue.

Water comes rather locally. So the locals are in the best position to determine whether or not they will be able to accommodate a heavy water user like a data center. All this bill says is prior to permitting, get that information. Help us help you. Because if you run out of water, we'll all not survive.

So let's make it so that we know exactly localities know exactly what's coming into their community so that they can make an informed decision about how they permit a data center. We are not mandating what localities should decide.

I see. Thank you.

Okay. Any more questions, comments? Okay. Seeing none, I I will be supporting your your bill today. Aye, I think the issue of information I know there's a lot of issues, multiple issues in this bill, but the issue of information for the local areas is really important.

I have a similar bill, to provide water supply assessments, and I think it's something that everyone needs to know to have it. Someone used the term blind spot for for planners. This should not be a blind spot for for planners. Madam Pappen, you may you may wrap up.

Wrap up. Okay. I just thank you for the the discourse. It's it's a very important issue. I agree with you, madam Chair, and I thank you for the aye recommendation and respectfully request an

I vote at the time. Thank you. We have built Motion made by Senator Cervantes.

The motion is do passed as amended to the committee on appropriation. Senators deRazzo? Aye. Derezzo, aye. Choi?

No. Choi, no. Arregin Ashby Cervantes? Aye. Cervantes, aye.

Larry Segardo. Two one.

Bill's on call. Thank you. Okay. And we'll go on, Assembly Member, with AB 2619.

And I'll be brief. Thank you, Madam Chair. So AB 2619 has a simple but essential goal, ensuring that local governments and water suppliers have the data they need about the actual and continuing water use of large facilities. AB 2619 requires data centers to provide their water use data to, their water use data to localities as part of the existing business licensure process. The bill also requires water agencies to include data centers in their urban water management plans and their annual water supply assessment.

I know that the urban one, I think, has to be done every five years, and the water supply is an assessment that's done annually. And it directs the Department of Water Resources to develop data center water usage best practices, nothing mandated, and a local planning guidance for our localities. When it comes to water, you know, it really is the old adage, you can't manage what you haven't measured. So this is just to keep measuring as we go along. Same witnesses as before, Eric Masanet and Sean Bothwell.

Hello again. Thank you again to the committee for the opportunity to speak. As I mentioned in my testimony for the original bill, better data on the drivers and quantities of data center water use will enable much better planning, much better forecast to balance economic and water goals, much less confusion and more evidence based dialogues between all stakeholders, and the identification of best practices for water efficiency that can be incentivized and rewarded.

In short, everyone benefits from better data, but as I mentioned earlier, voluntary reporting has fallen short. Let me share with you some numbers that are based on twenty years of voluntary data compiled by my lab. First, the positive news. Of the 80 or so major global operators we track, around two thirds report some sort of water data, and the numbers of reporters has been increasing over time.

Now, the not so positive news. Reported types are not at all consistent. Some report withdrawals, some report consumption, and some use only vague terms like total water. Reporting levels are also not consistent. Around two thirds of reporters disclose only corporate wide water use rather than the water use of data centers themselves.

When data center water use is reported, it's overwhelmingly at the global or regional levels rather than for specific what sites like those here in California. Very few of the companies we track disclose their cooling technologies, which gives us a sense of water lock in. And finally, what they report can change by year, even from the same company. The situation leaves analysts, planners, and stakeholders trying to make local decisions with a patchwork of incomplete, incompatible, and unreliable data.

But we don't have to settle for this in California, where practically every other major sector is assessed using collected data. All operators already have the data in hand, and many are already reporting these data to governments abroad, so we know that it can be done. Lastly, I'm skeptical that disclosing water use would reveal proprietary secrets. My lab has tried for years to reverse engineer reported data.

Trust me. And it can't be done with reasonable scientific confidence. Companies already tout their water efficiency goals and advanced cooling capabilities, so better reporting would allow them to both back these claims with data and get credit where credit is due. Thank you for your time. I'll be happy to answer any questions.

Thank you. Go ahead.

Again, Sean Bothwell, California Coastkeeper Alliance. In an ideal world, our state constitution requires that water users pay their proportional share of how much it costs to deliver water to them, in an ideal world. And the less data we have when we come to setting water rates, the more regressive our water rates will be. Meaning that high end users are putting the burden on low income communities to subsidize that infrastructure that's being put on by the higher end users, not the low income communities.

And so this bill and the annual reporting allows local agencies to determine the proper rate structure so that people are being charged the proportional share of what it cost to deliver them their proportional piece of water. The second part about the bill about DWR setting best practices, we had a good discussion about how innovative data centers are being.

This bill just really shines some light on that and what practices are out there. It does not require anything. In fact, if you put it in context of other cooling systems, power plants, they're mandated to use a certain technology at least as a floor. And this bill just looks at exploring best practices so that data centers can innovate to the best of their ability to conserve water. So with that, I'll ask for your aye vote. Thank you.

Thank you very much. Anyone in support of AB 2619? Please come forward.

Good morning. Remi Vrilakas with the Planning Conservation League in support.