Funding Alternatives to the Proposed Tax on Drinking Water
Most Californians have access to safe drinking water. The search for funding to provide safe water to the communities that don’t (primarily rural, disadvantaged communities) is vitally important. SB 845 proposes a charge on water bills with an opt-out feature as its primary funding source but there are other alternatives, including:
- California Form 540
The Legislature could add a new voluntary contribution fund check off to the California Form 540 and have it efficiently collected at a much lower cost by one state agency (the Franchise Tax Board) instead of requiring more than 3,000 community water systems to change their billing systems and hire new employees to bill and collect the funds and send them to Sacramento.
- Safe Drinking Water Funding Package
The second alternative to the proposed drinking water tax is the Safe Drinking Water Funding Package and is the current funding proposal by the coalition. This funding package is comprised of ongoing federal safe drinking water funds, voter-approved general obligation bond funds, the assessments related to nitrates in groundwater proposed in the budget trailer bill and in SB 623, and a limited amount of state general fund dollars.
- Safe and Affordable Drinking Water Trust
The third alternative would create an irrevocable trust that would be held for the sole purpose of providing funding for safe and affordable drinking water.
- Lease Revenue Bonds for Safe Drinking Water
The fourth alternative would use lease revenue bonds issued for safe drinking water.
- Cap and Trade Allocation for Safe Drinking Water
The fifth alternative would allocate a percentage of Cap and Trade funding for continuous appropriation for safe drinking water.
- Governance Solution
AB 2050 (Caballero, 2018), the Small System Water Authority Act of 2018, would propose a local solution for consolidation of non-compliant public water systems based on regional governance and administration.