The Sacramento Bee: Gavin Newsom budget calls for drinking water tax to help poor communities

By Dale Kasler, Ryan Sabalow, and Alexi Koseff

January 10, 2019 11:52 AM, Updated January 14, 2019 10:25 AM

Tackling what promises to be a controversial issue, Gov. Gavin Newsom proposed a tax on drinking water Thursday to help disadvantaged communities clean up contaminated water systems.

Newsom’s plan for a “safe and affordable drinking water fund,” included in the new governor’s first budget proposal, attempts to revive an idea that died in the Legislature last year.

A McClatchy investigation last year showed that at least 360,000 Californians rely on water that does not meet state standards for toxins. McClatchy also found that 6 million Californians have water providers that have violated state standards at some point since 2012.

“That is a disgrace,” Newsom told reporters at a budget press conference, citing a figure of 1 million people without access to safe drinking water.

Newsom said he also wants to earmark $25 million for safe drinking water, to jump-start the effort. His proposal was immediately hailed by safe drinking water advocates.

“These are our fellow Californians, and it’s past time to get this crisis resolved,” said Jonathan Nelson, policy director at a nonprofit advocacy group, the Community Water Center.

But Jon Coupal of the Howard Jarvis Taxpayer Association said he thinks improvements for water systems shouldn’t be addressed with a new tax when the state is sitting on a $14.8 billion budget surplus.

Coupal called Newsom’s proposal an example “of California’s knee-jerk reaction to default to a new tax whenever there’s a new problem.”

Details of Newsom’s plan weren’t immediately available, and state Sen. Bill Monning, D-Carmel, who spearheaded the tax proposal last year, said it could take several weeks to figure out the specifics.

Last year’s proposal would have taxed residential customers 95 cents a month, to raise about $110 million a year. Most of the Californians with unsafe drinking water resources live in the Southern San Joaquin Valley and the Mojave Desert, McClatchy found.

Dairy producers and feedlot operators would have contributed about $30 million in fees, for a total annual fund of $140 million. The dairy industry largely supported the bill, which provided some relief from disciplinary action as long as dairies followed “best practices” to limit toxins such as nitrate from cattle manure from leaching into drinking water.

“We’re excited,” said Anja Raudabaugh, CEO of Western United Dairymen. “We appreciate Gov. Newsom’s commitment to providing long-term solutions to drinking water in our communities, and we’re looking forward to providing a solution that includes certainty for our dairy producers.”

The Legislature scrapped the idea after protests from some segments of the agricultural community and the Association of California Water Agencies, which represents more than 400 water districts. It became clear that the proposal would have trouble it was proving increasingly difficult to secure the two-thirds super-majority needed to impose a new tax. Former Gov. Jerry Brown tried to resurrect the program last fall as a voluntary tax, but that died in the Legislature as well.

Cindy Tuck, a deputy executive director at the water agency association, said her group still has major concerns about the proposal.

“We think the problem can be solved without a tax,” she said.

Democrats’ success in the November elections means the tax could have a better chance of passing this year. Democrats now hold super-majorities in both houses of the Legislature, unlike last year.

But it’s no sure thing the proposed tax will make it through the Legislature even with Democrats firmly in charge. In November, California voters rejected the $8.9 billion Proposition 3 water bond that promised $500 million to clean up drinking water.

And within hours of Newsom’s announcement, some Democrats were expressing anxiety about a new tax.

Assemblyman Phil Ting, a San Francisco Democrat, said it would be a “very tough lift” in the Legislature to tax all Californians, most of whom have clean drinking water, to pay to fix pollution in a “very specific area.”

“It really comes down to how much time he and his staff are going to put toward it,” Ting said. “One of Gov. Brown’s strengths was really having a very narrow list of things to work on and get done, and because of that, he was able to get them done.”