Legal Alerts Oct 03, 2014

Governor Signs Legislation Amending California's Water Service Duplication Statute

Under Some Circumstances, Cities May Have the Opportunity to Provide Recycled Water Service Within the Service Area of Private Water Companies

Assembly Bill 2443, signed Monday by Gov. Jerry Brown, amends California’s Water Service Duplication Statute to allow for political subdivisions, such as municipalities or county water districts, to provide recycled water service to customers within the service area of privately owned water companies that do not currently provide recycled water service, upon the political subdivision’s compliance with the Water Recycling Act.

Under previous law, the California Water Service Duplication Statute attempted to grant privately owned water companies the right to be paid compensation for the diminution in the value of their property occurring as a result of the duplication of water service by a political subdivision, which was interpreted by some to prevent the expansion of recycled water service. The lone exception to this rule was a legislative amendment that exempted the use of recycled water by entities in Los Angeles County from the compensation requirement of the Statute. 

Specifically, AB 2443 makes inapplicable the requirement that a mutual water company is entitled to compensation when a public agency constructs facilities to provide or extend recycled water service to the territory of the mutual water company and has fully complied with the Water Recycling Act. However, this exemption would not apply in the case of a public agency providing or extending recycled water service to the territory of the mutual water company that already provides recycled water service, or has developed specific plans to provide recycled water service, by Dec. 31.

For more information about how this amendment to the Water Service Duplication Statute will affect your agency, please contact one of the attorney authors of this legal alert listed at right in the Environmental Law & Natural Resources practice group, or your BB&K attorney.

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