SECTIONS 12928-12928.6 - California Statutes

WATER CODE

SECTION 12928-12928.6

12928. (a) The money in the 1985 Water Conservation and Groundwater
Recharge Bond Fund shall be available for appropriation by the
Legislature for loans to local agencies to aid in the conduct of
projects for artificial groundwater recharge and the purposes set
forth in this section. The loan program shall be administered by the
department. Administrative costs of the loan program shall be paid
from moneys available therefor in the 1985 Water Conservation and
Groundwater Recharge Bond Fund as appropriated by the Legislature in
the annual Budget Bill.
(b) The department may enter into a contract for a loan if it
finds that the agency has the ability to repay the requested loan,
that the project is economically justified, and that the project is
feasible from an engineering and hydrogeologic viewpoint. However,
any contract concerning an eligible project for artificial
groundwater recharge shall include, in substance, all of the
following:
(1) An estimate of the reasonable cost and benefit of the project,
including a feasibility report which shall set forth the economic
justification and the engineering, hydrogeologic, and financial
feasibility of the project, and shall include explanations of the
proposed facilities and their relation to other water-related
facilities in the basin or region.
(2) An agreement by the agency to proceed expeditiously to
complete the project in conformance with the approved plans and
specifications and the feasibility report and to operate and maintain
the project properly upon completion throughout the repayment
period.
(3) Loan contracts may not provide a moratorium on payment of
principal or interest.
(4) Loans shall be for a period of up to 25 years with an interest
rate set annually by the department at 50 percent of the average
interest rate paid by the state on general obligation bonds in the
calendar year immediately preceding the year in which the loan
agreement is executed.
(5) No single project may receive more than five million dollars
($5,000,000) from the department.

12928.1. The department shall give priority to projects of agencies
located in overdrafted groundwater basins and those projects of
critical need, to projects whose feasibility studies show the
greatest economic justification and the greatest engineering and
hydrogeologic feasibility as determined by the department, and to
projects located in areas which have existing water management
programs.

12928.2. A contract for a loan pursuant to Section 12928 shall
require the prior approval of the California Water Commission.

12928.3. The department shall adopt rules and regulations necessary
to carry out the purposes of this chapter. The rules and regulations
shall include, but not be limited to, criteria and procedures for
establishing the eligibility of an agency and a project to qualify
for loans, and any terms and conditions necessary to protect the
investment of the state and to carry out the purposes of this
chapter.

12928.4. As a part of the contract for a loan, the agency shall
agree to indemnify and hold and save the state, the department, and
its employees free from any and all liability for damages that may
arise out of the work performed on projects financed under this
chapter.

12928.6. Groundwater recharge projects developed pursuant to this
chapter shall be eligible for funding pursuant to any bond law
previously or subsequently approved by the voters if the projects are
otherwise eligible for funding under the bond law.