Report 2021-118 All Recommendation Responses

Report 2021-118: State Water Resources Control Board: It Lacks the Urgency Necessary to Ensure That Failing Water Systems Receive Needed Assistance in a Timely Manner (Release Date: July 2022)

Recommendation for Legislative Action

To provide transparency and accountability in the State Water Board's efforts to assist failing water systems, the Legislature should amend state law to require the State Water Board by June 2023 to include its timeliness goals and its performance in comparison to those goals in the annual expenditure plans and reports it already submits to the Legislature. The Legislature should also require the State Water Board to include in those reports a list of drinking water project applications that have exceeded the board's timeliness goals and a brief description of the reasons for delays, its strategies for overcoming those delays, and its estimated time to execute funding agreements.

Description of Legislative Action

As of January 31, 2023, the Legislature has not taken action to address this specific recommendation.

California State Auditor's Assessment of 6-Month Status: No Action Taken

Description of Legislative Action

As of October 21, 2022, the Legislature has not taken action to address this specific recommendation.

California State Auditor's Assessment of 60-Day Status: No Action Taken

Recommendation #2 To: Water Resources Control Board

To minimize the prolonged periods during which Californians suffer without safe drinking water, the State Water Board should do the following by January 2023, streamline its application process by eliminating the need to submit unnecessary application documents and financial information.

6-Month Agency Response

The Drinking Water State Revolving Fund 2022-23 Intended Use Plan was adopted on October 3, 2022: https://www.waterboards.ca.gov/water_issues/programs/grants_loans/docs/2022/dwsrf-iup-sfy2022-23-final.pdf

The plan allows for reduced financial documentation and review process in the following cases.

1. 100% non-repayable Planning project

2. 100% non-repayable Consolidation/Regionalization project

As an additional measure, staff are also developing the Expedited Drinking Water Grant Funding Program. The draft guidelines for this program outline a new streamlined application process to enable DFA to commit state grant funds to projects more quickly. State Water Board consideration of adoption is planned for March 7, 2023. More info online at: https://www.waterboards.ca.gov/drinking_water/services/funding/expedited-grant-funding.html

California State Auditor's Assessment of 6-Month Status: Fully Implemented

60-Day Agency Response

Revising the Financial Application submittal and review for 100% non-repayable funded projects.

Pending adoption of Drinking Water State Revolving Fund 2022-23 Intended Use Plan. Revise the financial capacity review process for one hundred percent (100%) non-repayable planning and consolidation projects: 1. For one hundred percent (100%) non-repayable planning projects, the Division of Financial Assistance (DFA) will generally not require the applicant to submit a complete financial security package or undergo financial security review prior to receiving funding, as long as the planning project will address financial capacity. 2. A Public Water System will generally not require to demonstrate financial capacity to operate and maintain its system if it will be consolidated into another PWS, but the receiving water system must satisfy financial capacity requirements. DFA may apply alternative financial capacity review for the receiving water system(s) under certain circumstances.

California State Auditor's Assessment of 60-Day Status: Pending

We look forward to reviewing the State Water Board's revised financial application review process.

Recommendation #3 To: Water Resources Control Board

To minimize the prolonged periods during which Californians suffer without safe drinking water, the State Water Board should do the following by January 2023, review and revise its credit review process, including the creation of a limited credit review process for grant-funded projects.

6-Month Agency Response

The Drinking Water State Revolving Fund 2022-23 Intended Use Plan was adopted on October 3, 2022: https://www.waterboards.ca.gov/water_issues/programs/grants_loans/docs/2022/dwsrf-iup-sfy2022-23-final.pdf

The plan allows for reduced financial documentation and review process in the following cases.

1. 100% non-repayable Planning project

2. 100% non-repayable Consolidation/Regionalization project

As an additional measure, staff are also developing the Expedited Drinking Water Grant Funding Program. The draft guidelines for this program outline a new streamlined application process to enable DFA to commit state grant funds to projects more quickly. State Water Board consideration of adoption is planned for March 7, 2023. More info online at: https://www.waterboards.ca.gov/drinking_water/services/funding/expedited-grant-funding.html

California State Auditor's Assessment of 6-Month Status: Fully Implemented

60-Day Agency Response

Revising the Financial Application submittal and review for projects receiving 100% non-repayable financing. This will allow the Financial Review unit to create a new process for 100% non-repayable financing projects with a higher priority and a concise list of financial documentation. In addition of establishing a Fundable List tracking mechanism for better communication with Applicants of the various stages of their application. Pending adoption of Drinking Water State Revolving Fund 2022-23 Intended Use Plan.

California State Auditor's Assessment of 60-Day Status: Pending

We look forward to reviewing the State Water Boards revised financial application review process.

Recommendation #4 To: Water Resources Control Board

To minimize the prolonged periods during which Californians suffer without safe drinking water, the State Water Board should do the following by January 2023, develop a process to fast-track urgent water projects, particularly for failing water systems affecting a large number of people or serving a disadvantaged community. One option for doing so would be to use state-only funding that is not subject to federal requirements.

6-Month Agency Response

The Draft Fiscal Year 2022-23 Fund Expenditure Plan for the Safe and Affordable Drinking Water Fund (adopted October 3, 2022, https://www.waterboards.ca.gov/water_issues/programs/grants_loans/docs/2022/final-2022-23-sadw-fep.pdf) includes an avenue for expedited funding for high priority capital projects through our Urgent Drinking Water Needs program, with the Safe and Affordable Drinking Water Fund (state grant funds). Criteria to select projects for this new approach include: project cost less than $500,000, projects serving a small disadvantaged community that is out of compliance or at-risk with a high priority public health need or consolidation opportunity, ready to proceed or low-complexity planning/approvals outstanding.

As an additional, broader option to fast-track urgent projects, staff are also developing the Expedited Drinking Water Grant Funding Program that will utilize multiple state grant sources and will target specific high priority, grant eligible construction projects. The draft guidelines describe a new streamlined application process to enable DFA to commit funds to projects more quickly. State Water Board consideration of adoption is planned for March 7, 2023. More info online at: https://www.waterboards.ca.gov/drinking_water/services/funding/expedited-grant-funding.html

California State Auditor's Assessment of 6-Month Status: Fully Implemented

60-Day Agency Response

The Draft Fiscal Year 2022-23 Fund Expenditure Plan for the Safe and Affordable Drinking Water Fund includes an avenue for expedited funding for high priority capital projects through our Urgent Drinking Water Needs program. Draft criteria to select projects for this new approach include: project cost less than $500,000, projects serving a small disadvantaged community that is out of compliance or at-risk with a high priority public health need or consolidation opportunity, ready to proceed or low-complexity planning/approvals outstanding. Staff are already reviewing upcoming needs to identify projects to prioritize for this path, and staff will begin implementing this new approach upon Board approval of the draft language. Board consideration is scheduled for October 3, 2022.

California State Auditor's Assessment of 60-Day Status: Pending

We look forward to reviewing the State Water Boards revised process to fast-track urgent water projects.

Recommendation #5 To: Water Resources Control Board

To minimize the prolonged periods during which Californians suffer without safe drinking water, the State Water Board should do the following by January 2023, establish expectations for how quickly its staff will review initial applications, communicate to water systems about the need for additional information or revisions, and wait for water systems to respond before reaching out to determine the cause of application delays. In addition, the State Water Board should document and measure staff adherence to these expectations and make adjustments to its review and communication processes as necessary.

6-Month Agency Response

The DFA developed expectations and Key Performance Indicators (KPIs) for the initial phases of staff review, as well as for water system responsiveness.

California State Auditor's Assessment of 6-Month Status: Fully Implemented

State Water Board developed procedures regarding expectations for how quickly its staff will review initial applications, communicate to water systems about the need for additional information or revisions, and wait for water systems to respond before reaching out to determine the cause of application delays. The procedures further include staff application review metrics.

60-Day Agency Response

The Division of Financial Assistance is developing Key Performance Indicators (KPIs) for different phases of staff review, as well as for water system responsiveness. KPIs will be established by December 2022.

California State Auditor's Assessment of 60-Day Status: Pending

We look forward to reviewing the State Water Board's key performance indicators for different phases of staff review and how it will document and measure staff adherence to these expectations and adjust its review and communication processes as necessary.

Recommendation #6 To: Water Resources Control Board

To minimize the prolonged periods during which Californians suffer without safe drinking water, the State Water Board should do the following by January 2023, establish and implement a process for project managers and staff to document their communications with water systems.

6-Month Agency Response

DFA developed a process to document communications with water systems. See attachment #6.

California State Auditor's Assessment of 6-Month Status: Fully Implemented

State Water Board developed procedures to document communications with applicants.

60-Day Agency Response

The Division of Financial Assistance (DFA) currently has a process in place to document communications with water systems. DFA is reviewing this process and identifying opportunities for further improvements to the process, as well as ensuring staff have been properly trained on the expected documentation procedures.

California State Auditor's Assessment of 60-Day Status: Pending

We look forward to reviewing the State Water Board's revised process to document communications with water systems.

Recommendation #7 To: Water Resources Control Board

To minimize the prolonged periods during which Californians suffer without safe drinking water, the State Water Board should do the following by January 2023, develop metrics and performance benchmarks for key phases of the application and funding processes, including the number of days it should take to execute a funding agreement after it receives a complete application. It should also review recent past applications in light of these new metrics to identify common reasons for delays—including an increase in consolidation projects—and develop processes to overcome these delays.

1-Year Agency Response

The State Water Board's 1 year update was due on July 26, 2023. It did not respond to our request for information.

California State Auditor's Assessment of 1-Year Status: Pending

We look forward to reviewing the State Water Board's progress toward implementing our recommendation.

6-Month Agency Response

Key performance indicators (KPIs) for key phases of the the application review and agreement development/execution process have been developed for planning and construction projects, including number of days to execute an agreement from determining a complete application, assuming no eligibility issues identified during the course of the eligibility review and timely engagement/responsiveness from the applicant. An evaluation of recent applications in light of these proposed KPIs is now underway to identify common reasons for delay, including consolidation projects. See attachment #7.

California State Auditor's Assessment of 6-Month Status: Partially Implemented

Although State Water Board developed benchmarks for key phases of the application and funding processes, its response indicates it is in the process of reviewing past applications in light of these new metrics to identify common reasons for delays and develop processes to overcome these delays. We look forward to reviewing its analysis and new processes to overcome application funding delays.

60-Day Agency Response

Key Performance Indicators (KPIs) have been added to the Drinking Water State Revolving Fund Draft Intended Use Plan. State Board consideration of adoption is October 2022. Additional KPIs are under development for the application review and agreement processes and will be completed by December 2022. State Board staff are conducting a Lean Six Sigma evaluation of the consolidation process.

California State Auditor's Assessment of 60-Day Status: Pending

We look forward to reviewing the State Water Board's metrics and performance benchmarks for key phases of the application and agreement processes.

Recommendation #8 To: Water Resources Control Board

To minimize the prolonged periods during which Californians suffer without safe drinking water, the State Water Board should do the following by January 2023, determine whether to change the way it assigns staff to projects, including whether to dedicate staff to working only on applications or on monitoring projects under construction.

1-Year Agency Response

The State Water Board's 1 year update was due on July 26, 2023. It did not respond to our request for information.

California State Auditor's Assessment of 1-Year Status: Pending

We look forward to reviewing the State Water Board's progress toward implementing our recommendation.

6-Month Agency Response

The Division of Financial Assistance completed the reorganizational structure in January 2023 that will address the Division's operational needs, support new state and federal funding, and address concerns about delays in providing funding for water quality projects. The new structure aligns workload to meet critical program needs.

California State Auditor's Assessment of 6-Month Status: Pending

We requested a copy of State Water Board's reorganization, but have not yet received the requested evidence.

60-Day Agency Response

The Division of Financial Assistance has submitted a re-organization request, which will result in changes in staff assignments that should result in expedited processing of applications. The re-organization is expected to be completed by October 2022.

California State Auditor's Assessment of 60-Day Status: Pending

We look forward to reviewing the State Water Board's reorganization of its staff and its analysis of the impact this staff reorganization has on processing applications.

Recommendation #9 To: Water Resources Control Board

To minimize the prolonged periods during which Californians suffer without safe drinking water, the State Water Board should do the following by January 2023, obtain input from its advisory group on the development and execution of staff expectations, metrics, and benchmarks related to its application and funding processes.

6-Month Agency Response

As part of the November 17, 2022 Advisory Group Meeting, staff presented an update for advisory group members on development of expectations, metrics, and benchmarks, to gather input on these aspects of the program. The presentation, meeting notes, and recording are available online: https://www.waterboards.ca.gov/safer/advisory_group.html

California State Auditor's Assessment of 6-Month Status: Fully Implemented

60-Day Agency Response

Staff are preparing an update for advisory group members to gather input on these aspects of the program to inform our audit response, as part of the scheduled November 17, 2022 advisory group meeting. Input from the members will be incorporated into final recommendations.

California State Auditor's Assessment of 60-Day Status: Pending

We look forward to reviewing the advisory group's updated comments and recommendations and how the State Water Board intends to implement these recommendations.

Recommendation #10 To: Water Resources Control Board

To increase transparency in the funding process and make its online search tool more useful to water systems applying for funding, by January 2023 the State Water Board should update its online search tool for funding applications to include a description of the additional information the State Water Board needs from the water system to continue processing its application.

1-Year Agency Response

DFA staff completed the implementation of new data elements in LGTS and modifications to the mobile app status tool in April 2023. DFA staff will continue to provide timely updates to the new milestone status data elements in LGTS and will be highlighted in an upcoming LGTS training sessions. DFA staff will update data reported in the mobile app status tool on at least a monthly basis. The tool is available online here: https://public.waterboards.ca.gov/dfaAppSTAT/

California State Auditor's Assessment of 1-Year Status: Fully Implemented

The State Water Board's online search tool now provides the status of the application and what sections of the application are incomplete, and identifies if the applicant is nonresponsive to requests for documents, among other upgrades.

6-Month Agency Response

DFA staff are working with contractors to include new data fields in our Loans and Grants Tracking (LGTS) database to better track the status of each of the four application packages. These new data fields will provide additional details on what is missing or not yet complete, and where the application package is in the review process. DFA staff are also working with our Division of Information Technology to make the necessary modifications to the online Application Status Report to accept and report the new status fields, as well as additional information to help applicants and other stakeholders follow the process and understand anticipated process timelines. Due to resource limitations, staff plan to complete this work by March 2023.

California State Auditor's Assessment of 6-Month Status: Pending

We look forward to reviewing the State Water Board's progress in implementing this recommendation.

60-Day Agency Response

Division of Financial Assistance is looking to make changes to the Loans & Grants Tracking System to be able to track missing documentation that is specific to each application package. Submit request to database contractor in September 2022.

California State Auditor's Assessment of 60-Day Status: No Action Taken

Recommendation #11 To: Water Resources Control Board

To increase transparency in the funding process and make its online search tool more useful to water systems applying for funding, by January 2023 the State Water Board should update its online search tool for funding applications to include any deadlines the State Water Board has issued to the water system to provide additional information.

1-Year Agency Response

DFA staff completed the implementation of new data elements in LGTS and modifications to the mobile app status tool in April 2023. DFA staff will continue to provide timely updates to the new milestone status data elements in LGTS and will be highlighted in an upcoming LGTS training sessions. DFA staff will update data reported in the mobile app status tool on at least a monthly basis. The tool is available online here: https://public.waterboards.ca.gov/dfaAppSTAT/

California State Auditor's Assessment of 1-Year Status: Fully Implemented

The State Water Board's online search tool now provides the date the status was last updated for an application and identifies if the applicant is nonresponsive to requests for documents, among other upgrades.

6-Month Agency Response

DFA staff are working with contractors to include new data fields in our Loans and Grants Tracking (LGTS) database to better track the status of each of the four application packages. These new data fields will provide additional details on what is missing or not yet complete, and where the application package is in the review process. DFA staff are also working with our Division of Information Technology to make the necessary modifications to the online Application Status Report to accept and report the new status fields, as well as additional information to help applicants and other stakeholders follow the process and understand anticipated process timelines. Due to resource limitations, staff plan to complete this work by March 2023.

California State Auditor's Assessment of 6-Month Status: Pending

We look forward to reviewing the State Water Board's progress in implementing this recommendation.

60-Day Agency Response

Division of Financial Assistance is exploring options on how we could track some of the deadlines for additional documentation requests. This would coincide with additional changes needed in the database. Submit request for changes September 2022.

California State Auditor's Assessment of 60-Day Status: No Action Taken

Recommendation #12 To: Water Resources Control Board

To increase transparency in the funding process and make its online search tool more useful to water systems applying for funding, by January 2023 the State Water Board should update its online search tool for funding applications to include the cause of any prolonged delays in the process, including the need for reviews by external parties.

1-Year Agency Response

DFA staff completed the implementation of new data elements in LGTS and modifications to the mobile app status tool in April 2023. DFA staff will continue to provide timely updates to the new milestone status data elements in LGTS and will be highlighted in an upcoming LGTS training sessions. DFA staff will update data reported in the mobile app status tool on at least a monthly basis. The tool is available online here: https://public.waterboards.ca.gov/dfaAppSTAT/

California State Auditor's Assessment of 1-Year Status: Fully Implemented

The State Water Board updated its online search tool to allow the project manager to track the status of the individual application packages and includes a drop down menu for status options-including, additional document requests and if the applicant is non response to additional document requests.

6-Month Agency Response

DFA staff are working with contractors to include new data fields in our Loans and Grants Tracking (LGTS) database to better track the status of each of the four application packages. These new data fields will provide additional details on what is missing or not yet complete, and where the application package is in the review process. DFA staff are also working with our Division of Information Technology to make the necessary modifications to the online Application Status Report to accept and report the new status fields, as well as additional information to help applicants and other stakeholders follow the process and understand anticipated process timelines. Due to resource limitations, staff plan to complete this work by March 2023.

California State Auditor's Assessment of 6-Month Status: Pending

We look forward to reviewing the State Water Board's progress in implementing this recommendation.

60-Day Agency Response

Division of Financial Assistance is exploring options on how we could track some of the causes for delay. This would coincide with additional changes needed in the database. Submit request for changes September 2022.

California State Auditor's Assessment of 60-Day Status: No Action Taken

Recommendation #13 To: Water Resources Control Board

To increase transparency in the funding process and make its online search tool more useful to water systems applying for funding, by January 2023 the State Water Board should update its online search tool for funding applications to include the date the State Water Board expects to complete its reviews and award funding to the water system.

1-Year Agency Response

DFA staff completed the implementation of new data elements in LGTS and modifications to the mobile app status tool in April 2023. DFA staff will continue to provide timely updates to the new milestone status data elements in LGTS and will be highlighted in an upcoming LGTS training sessions. DFA staff will update data reported in the mobile app status tool on at least a monthly basis. The tool is available online here: https://public.waterboards.ca.gov/dfaAppSTAT/

California State Auditor's Assessment of 1-Year Status: Fully Implemented

The State Water Board updated its online search tool to include general timeframes for phases of the review and approval process, and the actual dates of the timeframes. These milestones include that applicants are typically issued a funding agreement for signature within 2.5 months form the date date the supervising engineer approves the project.

6-Month Agency Response

DFA staff are working with contractors to include new data fields in our Loans and Grants Tracking (LGTS) database to better track the status of each of the four application packages. These new data fields will provide additional details on what is missing or not yet complete, and where the application package is in the review process. DFA staff are also working with our Division of Information Technology to make the necessary modifications to the online Application Status Report to accept and report the new status fields, as well as additional information to help applicants and other stakeholders follow the process and understand anticipated process timelines. Due to resource limitations, staff plan to complete this work by March 2023.

California State Auditor's Assessment of 6-Month Status: Pending

We look forward to reviewing the State Water Board's progress in implementing this recommendation.

60-Day Agency Response

Division of Financial Assistance is looking at existing database information, such as key milestone dates in the contract development process, to determine which would be applicable to report in the online tool. Modifications to existing reports will be needed. Submit request to database contractor in September 2022.

California State Auditor's Assessment of 60-Day Status: Pending

Recommendation #14 To: Water Resources Control Board

To ensure that it has sufficient staff to process funding applications in a timely manner, by July 2023 the State Water Board should evaluate its progress in meeting its performance goals and assess whether its current staffing levels are sufficient. If the State Water Board finds that it needs additional staff to meet its goals or to prevent a backlog of applications, it should request additional funding from the Legislature to meet its staffing needs.

1-Year Agency Response

The State Water Board's 1 year update was due on July 26, 2023. It did not respond to our request for information.

California State Auditor's Assessment of 1-Year Status: Pending

We look forward to reviewing the State Water Board's progress toward implementing our recommendation.

6-Month Agency Response

DFA received 25 PY in the current fiscal year budget to support administration of new federal and State funding. DFA anticipates that the combination of filling these new positions, and efficiencies gained through process improvements and DFA's recent re-organization, will allow DFA to meet its performance goals. The Governor's FY 23/24 Budget, therefore, does not include a request for additional staff resources.

California State Auditor's Assessment of 6-Month Status: Pending

We have requested supporting documentation from the State Water Board and look forward to reviewing its progress in implementing this recommendation.

60-Day Agency Response

The staffing resources of the State Water Board are determined by State Legislature and the Governor's Office. In 2022 State Budget Act, the Division of Financial Assistance received 25 new positions to help administer an increase in Drinking Water and Clean Water State Revolving Fund financing provided under the federal Infrastructure Investment and Jobs Act. These positions are in addition to new positions provided in the 2021 Budget Act to help administer approximately $1.3B in drinking water and clean water project funding.

California State Auditor's Assessment of 60-Day Status: No Action Taken

Recommendation #15 To: Water Resources Control Board

To ensure that it effectively manages technical assistance projects and oversees technical assistance providers' performance, by January 2023 the State Water Board should establish performance metrics and time frames for its review of technical assistance providers' deliverables to verify that the providers have addressed water systems' needs in an appropriate and timely manner. The State Water Board should include its metrics and performance expectations in all of its technical assistance provider agreements.

6-Month Agency Response

December 2022 - Review draft recommendations w/Technical Assistance providers (see attached presentation #15a, slide 20)

January 2023 - Final expectations/metrics approved by Deputy Director (see attached memo #15b)

Agreements will be amended over time to incorporate appropriate expectations and metrics. "

California State Auditor's Assessment of 6-Month Status: Fully Implemented

The State Water Board provided its performance expectations and metrics - including time frames for its review of technical assistance providers' deliverable.

60-Day Agency Response

September 2022 - Meet w/Technical Assistance providers

October 2022 - Develop key performance indicators and expectations

November 2022 - Review w/Technical Assistance providers/finalize

December 2022 - Notify Technical Assistance providers of Key Performance Indicators (KPIs)/expectations.

New and amended agreements will include KPIs and expectations.

California State Auditor's Assessment of 60-Day Status: Pending

Recommendation #16 To: Water Resources Control Board

To ensure that it is maximizing the number of water systems that are aware of available technical assistance and funding options, including failing water systems and water systems serving disadvantaged communities, the State Water Board should immediately amend the contract with its current outreach provider to coordinate with the State Water Board to ensure that the provider does not work with systems already receiving technical assistance. The State Water Board should also develop a plan by January 2023 to avoid future outreach work that duplicates the efforts of its providers or of its staff.

1-Year Agency Response

The State Water Board's 1 year update was due on July 26, 2023. It did not respond to our request for information.

California State Auditor's Assessment of 1-Year Status: Pending

We look forward to reviewing the State Water Board's progress toward implementing our recommendation.

6-Month Agency Response

The technical assistance agreement referenced in the audit report (D1917007), which includes unique outreach work to at risk systems, has been amended (#16 attached) to incorporate new processes to avoid duplication of effort, including a semi-annual outreach plan identifying which systems they will target and why, and to outline the general outreach approach planned. This will allow us to weigh in on priorities and assist them in cross-checking to avoid any duplication with other outreach and technical assistance efforts. Other technical assistance agreements require a Division approved Assistance Request prior to starting work with a system to eliminate potential for duplication.

California State Auditor's Assessment of 6-Month Status: Partially Implemented

60-Day Agency Response

The technical assistance agreement referenced in the audit report (D1917007) is being amended to incorporate new processes including a semi-annual outreach plan identifying which systems they will target and why, and to outline the general outreach approach planned. This will allow us to weigh in on priorities and assist them in cross-checking to avoid any duplication with other outreach or technical assistance efforts. Their quarterly reporting will also provide data from the initial outreach and any recommended next steps for the contacted systems based on initial outreach efforts. The amendment is expected to be executed by December 2022/January 2023.

California State Auditor's Assessment of 60-Day Status: Pending

Recommendation #17 To: Water Resources Control Board

To address the funding gap identified in its needs assessment report, the State Water Board should immediately work with the Legislature, and with federal agencies to the extent possible, to request the resources necessary to ensure that water systems can meet drinking water standards, including repairing or improving water treatment technologies, consolidating water systems, and providing technical assistance.

1-Year Agency Response

State funding priorities are determined annually by the State Legislature and Governor.

The State Water Board informs the State Legislature of its funding investments and updates identified needs annually through its SAFER Fund Expenditure Plan and the Drinking Water Intended Use Plan.

State Budget Act of 2023: The $1.3B for wastewater and drinking water projects provided under the State Budget Act of 2022 was reduced by $200M. The $200M funding may be re-appropriated in a subsequent fiscal year. The State Water Board elected to allocate the $200M reduction to primarily to the wastewater allocation due to overwhelming demand for the drinking water projects that address high public health priorities.

California State Auditor's Assessment of 1-Year Status: Fully Implemented

6-Month Agency Response

State funding priorities are determined annually by the State Legislature and Governor.

The State Water Board informs the State Legislature of its funding investments and updates identified needs annually through its SAFER Fund Expenditure Plan and the Drinking Water Intended Use Plan.

State Budget Act of 2021, the Division of Financial Assistance (DFA) received: $1.3B for wastewater and drinking water projects; $30M for Per-and polyfluoroalkyl substances (PFAS) support for water systems; $150M for groundwater cleanup and water recycling projects.

State Budget Act of 2022, DFA received: $50M for Drinking Water Emergencies; $400M for Clean Water (CW) and Drinking Water (DW) State Revolving Funds (SRF); $190M for water recycling; $50M PFAS support for water systems.

This new funding supports our safe drinking water programs and is in addition to existing State bond and continuously appropriated DWSRF monies, which are further capitalized by the federal Bipartisan Infrastructure Law. In FY 22/23, the DWSRF received approximately $220M in federal funding for any eligible drinking water project, $73M in federal funding for drinking water projects addressing emerging contaminants and $250M in federal funding for the replacement of lead services lines.

Collectively, this funding will continue to provide for drinking water benefits via a variety of projects, including technical assistance, addressing aging infrastructure, new treatment improvements and consolidation of drinking water systems. These significant federal and State investments are sufficient in the near-term to support priority projects for which planning has been completed and to address planning needs in failing systems requiring such assistance.

California State Auditor's Assessment of 6-Month Status: Fully Implemented

60-Day Agency Response

The State and federal funding priorities are determined annually by the State Legislature, Governor's Office and Congress.

State Budget Act of 2021, the Division of Financial Assistance (DFA) received: $1.3B for wastewater and drinking water projects; $30M for Per-and polyfluoroalkyl substances (PFAS) support for water systems; $150M for groundwater cleanup and water recycling projects

State Budget Act of 2022, DFA received: $50M for Drinking Water Emergencies; $400M for Clean Water (CW) and Drinking Water (DW) State Revolving Funds (SRF); $190M for water recycling; $50M PFAS support for water systems.$47M earmarked for 11 projects; $5M for water refilling stations at schools.

This new funding provides direct and indirect benefit for safe drinking water and is in addition to existing general obligation bond and continuously appropriated DWSRF monies, which are further capitalized by the federal Infrastructure and Investment and Jobs Act. In State Fiscal Year 2022-2023, the DWSRF was provided approximately $220M in federal funding for any eligible drinking water project, $80M in federal funding for drinking water projects addressing emerging contaminants and $250M in federal funding for the replacement of lead services lines.

Collectively, this funding will continue to provide for drinking water benefits via a variety of projects, including technical assistance, repairing and replacing aging infrastructure, new treatment improvements and consolidation of drinking water systems.

California State Auditor's Assessment of 60-Day Status: Pending

All Recommendations in 2021-118

Agency responses received are posted verbatim.