What Can We Learn From How the State Responded to the Last Major Drought?

What Can We Learn From How the State Responded to the Last Major Drought? Summary For the second consecutive year, the state is experiencing extremely low rates of precipitation. As we prepare for what could be an extended period of dry conditions, it is helpful to review how the state responded to the last major drought. Such information can inform—and thereby potentially improve—the state’s current and ongoing response to developing conditions. In this report, we summarize the major activities, spending, and policy actions undertaken by the state to respond to the severe drought that occurred from 2012 through 2016. We also describe current conditions, and highlight some key lessons the Legislature can learn from previous efforts to help guide its response to the emerging drought. (We will provide our analysis of the Governor’s May Revision drought spending proposals in a future document.) GABRIEL PETEK LEGISLATIVE ANALYST MAY 2021 analysis full gutter AN LAO REPORT STATE EXPERIENCED MAJOR DROUGHT LAST DECADE Severe Drought Lasted From 2012 Through while the drought led to a decrease in deliveries 2016. California’s most recent drought included the from the state and federal water systems and a driest consecutive four-year stretch since statewide corresponding decline in agricultural production, precipitation record-keeping began—2012 through farmers and ranchers were able to moderate 2015—with 2014 representing the third driest impacts somewhat by employing short-term year on record. The effects of these trends were strategies, such as fallowing land, purchasing compounded by higher than normal temperatures. water from others, and—in particular—pumping Warmer temperatures contribute to the severity of groundwater. In contrast, some rural residential drought conditions by leading to more precipitation communities—mainly in the Central Valley— falling as rain rather than snow, faster melting of struggled to identify alternative water sources winter snowpack, greater rates of evaporation, upon which to draw when their domestic wells and drier soils. Annual statewide temperatures went dry. Multiple years of warm temperatures exceeded the historical average every year during and dry conditions also had severe effects on the last drought, and 2015 and 2014 were, environmental settings across the state, including respectively, the first and second warmest years degrading habitats for fish, water birds, and other on record. wildlife; promoting conditions that resulted in bark Drought Impacts Were Widespread, but beetles killing millions of trees; and contributing Varied by Sector. The severity of the drought’s to more prevalent and intense wildfires. For urban impacts varied significantly across the state communities, the primary drought impact was because of differences in both water needs and a state-ordered requirement to use less water, access to alternative water sources. For example, including mandatory constraints on the frequency of outdoor watering. MAJOR RESPONSE ACTIVITIES AND SPENDING State Spent $3.3 Billion for Drought Response spending in other categories—emergency response Activities, Mostly for Longer-Term Water Supply ($734 million), water conservation ($287 million), Projects. Figure 1 on the next page summarizes and environmental protection ($78 million)—was the state funding provided in response to the more targeted for addressing and ameliorating drought from 2013-14 through 2016-17. As urgent drought effects on people, agriculture, and shown, of the $3.3 billion in total appropriations, the environment. about two-thirds—$2.2 billion—was for activities State Funded Wide Variety of Emergency to increase water supplies. In most cases, the Response Activities. Emergency response types of activities funded in this category—such as spending spanned numerous efforts, with enhanced grants to local entities to build infrastructure like fire protection activities—such as for additional water recycling or wastewater treatment plants or firefighters and equipment—representing the facilities to remediate contaminated groundwater— largest category ($384 million). During the drought were not to provide immediate drought assistance. period, the state experienced four wildfires that Rather, because these projects typically take ranked among the top 20 for greatest area burned several years to complete, they were more likely in California, and two fires that were among the to enhance long-term supplies and build greater state’s 20 most destructive. This was partly due resilience for subsequent droughts. In contrast, the to extremely dry conditions combined with a 2 LEGISLATIVE ANALYST’S OFFICE analysis full gutter AN LAO REPORT large number of dead and dying trees across the and businesses saved over 201 billion gallons state, particularly in the southern Sierra region. of water, including by converting nearly 605,000 (As shown in the figure, the state also provided square feet of grass to more drought-tolerant $41 million to remove some of those trees.) The landscapes and installing over 155,000 water second largest emergency response spending saving devices. As evidence of these effects, category ($115 million) was for addressing statewide urban water usage in 2020 remained drinking water emergencies affecting thousands of significantly below 2014 levels. households—mostly in disadvantaged communities Spending for Environmental Protection in the southern San Joaquin Valley—for whom Was to Address Urgent Conditions for domestic wells went dry or became contaminated Fish and Wildlife. Most of the $78 million in as groundwater levels dropped due to heavy rates environmental protection spending was to of agricultural pumping. For example, the State respond to emergency conditions affecting fish Water Resources Control Board (SWRCB) provided emergency funding to more than 180 mostly small water systems for Figure 1 projects such as connecting with State Drought Response Appropriations another system or drilling new or 2013-14 Through 2016-17 (In Millions) deeper wells. (In addition to the Activity Amount drought spending shown in the figure, the state provided additional Water Supply funding to address drinking Support groundwater management and cleanup $843 Improve/increase water recycling, wastewater treatment, 609 water shortages in 2017-18 and stormwater management, and desalination 2018-19.) Fund Integrated Regional Water Management projects 473 Water Conservation Spending Improve drinking water infrastructure 311 Intended to Reduce Water Subtotal ($2,235) Usage. As shown in the figure, Emergency Response the state allocated a total of Expand/enhance fire protection $384 $287 million to increase water Address emergency drinking water needs 115 conservation and efficiencies Provide food and other assistance to drought-affected 99 communities and farmworkers across both the urban and Conduct statewide drought assistance, monitoring, and 55 agricultural sectors, as well as at response state facilities and wildlife refuges. Remove and dispose of dead trees 41 While such efforts were intended Monitor/enforce water rights and conservation regulations 20 help ameliorate water shortages Various other activities 21 in the 2012 to 2016 drought, they Subtotal ($734) also will provide some ongoing Water Conservation benefits for the current and future Increase urban water efficiency and conservation $126 droughts. This is because many Increase agricultural water efficiency and conservation 110 Fund innovative water efficiency technologies 30 of the expenditures—such as Conduct conservation outreach and public messaging 23 for rebates to remove residential Increase water efficiency at state facilities and wildlife 28 lawns and grants to improve refuges the efficiency of agricultural Subtotal ($287) irrigation systems—have resulted Environmental Protection in permanent reductions in Emergency fish and stream activities $70 water usage. For example, the Eradicate water hyacinth 4 Department of Water Resources Study and model flows 3 (DWR) estimates that state rebate Subtotal ($78) programs for urban households Total $3,334 www.lao.ca.gov 3 analysis full gutter AN LAO REPORT and wildlife. Activities included Figure 2 trucking hatchery-produced State Drought Funding by Source fish downstream—rather than releasing them in the typical 2013-14 Through 2016-17 Other Special Funds upstream locations—to avoid Greenhouse Gas migratory hazards and improve Reduction Fund survival rates; rescuing and relocating at-risk fish and other aquatic species, both from watersheds with deteriorated water conditions, as well as from hatcheries rendered General Fund unusable due to heat or disease; responding to increased incidents of human-wildlife contact; and intensive monitoring of how Bond Funds drought conditions were affecting at-risk, threatened, or endangered fish and wildlife species. Majority of Funding Was From Voter-Approved General Total: $3.3 Billion Obligation Bonds. Figure 2 highlights that the significant majority—$2.3 billion, or about coming from the state’s Greenhouse Gas Reduction 70 percent—of the state’s drought response Fund to support water conservation efforts. activities from 2013-14 through 2016-17 were Multiple State Departments Involved in supported by voter-approved general obligation Drought Response Activities. While certain state bonds. These funds were dedicated primarily to the departments—specifically DWR, the California water supply expenditures highlighted in Figure 1. Department of Fish and Wildlife (CDFW), SWRCB, Most of these bond funds (roughly $1.9 billion) and the Office of Emergency Services (OES)— were from Proposition 1, a large water bond that played particularly large roles in managing the voters approved midway through the drought in state’s response to the last drought, several November 2014. Additional bond funds were from others also assumed specific responsibilities. Proposition 84, approved in 2006. The state’s Figure 3 on the next page shows the 13 different General Fund supported close to one-quarter state departments that received a share of the (about $770 million) of the state’s drought response funding highlighted in Figure 1, along with a expenditures, including for emergency response, description of the major drought response activities water conservation, and environmental protection they undertook. To help coordinate statewide activities. The remainder was from 13 different efforts, Governor Brown convened an interagency special funds for various efforts that aligned with Drought Task Force in 2013 that met weekly each fund’s allowable uses, with the largest share throughout the drought. 4 LEGISLATIVE ANALYST’S OFFICE analysis full gutter AN LAO REPORT MAJOR POLICY CHANGES In addition to increased funding, the state’s from undergoing environmental impact reviews response to the 2012 to 2016 drought included typically required by the California Environmental both temporary and permanent policy changes. Quality Act (CEQA). For example, DWR and (For a detailed list of significant drought-related SWRCB approved certain transfers of water policy changes implemented through the beginning between buyers and sellers, and CDFW undertook of 2016, please see the Appendix of our report, The several restoration and upgrade projects on its 2016-17 Budget: The State’s Drought Response.) lands, all without conducting CEQA reviews. In Drought Response Included Numerous addition, state regulatory agencies exercised their Short-Term Policy and Regulatory Changes. regular—nonemergency—authority to respond Because certain drought conditions require to drought conditions. For example, SWRCB immediate response but do not continue forever, ordered and enforced that less water be diverted many policy changes undertaken between from some of the state’s rivers and streams, and 2012 and 2016 were authorized on a temporary CDFW closed some rivers and streams to fishing basis, often by gubernatorial executive order or in order to protect fish in low water flows. SWRCB emergency departmental regulations. Such actions also approved (with some modifications) several included expediting certain drought-response petitions from the federal Bureau of Reclamation projects and activities by exempting them from and DWR to temporarily relax flow and water meeting some state contracting requirements and quality standards within the Delta and thereby Figure 3 Drought Response Responsibilities Spread Across Multiple State Departments Department Major Drought Response Activities CalFire Conducted fire protection activities; removed and disposed of dead trees. CCC Conducted conservation outreach and messaging. CDFA Allocated grants to increase agricultural water efficiency. CDFW Conducted emergency fish and stream activities; improved water efficiency at wildlife refuges. CSD Assisted drought-impacted farmworkers. DGS Increased water efficiency at state facilities. DSS Provided food to drought-affected communities. DWR Allocated water conservation grants; assisted with drinking water shortages; supported and monitored groundwater use and management; installed/removed Delta emergency rock barriers; managed State Water Project allocations and transfers; managed Save Our Water campaign; allocated Integrated Regional Water Management grants. EDD Provided job training in drought-affected communities. HCD Assisted and relocated drought-affected households. OES Coordinated statewide drought response; provided emergency drinking water; allocated grants to remove dead trees on public lands. Parks Conducted water hyacinth eradication activities. SWRCB Provided emergency drinking water; made emergency improvements to drinking water systems; adopted/monitored/enforced water rights and conservation regulations; allocated bond-funded grants for various water supply projects. CalFire = California Department of Forestry and Fire Protection; CCC = California Conservation Corps; CDFA = California Department of Food and Agriculture; CDFW = California Department of Fish and Wildlife; CSD = Department of Community Services and Development; DGS = Department of General Services; DSS = Department of Social Services; DWR = Department of Water Resources; EDD = Employment Development Department; HCD = Department of Housing and Community Development; OES = Office of Emergency Services; Parks = Department of Parks and Recreation; and SWRCB = State Water Resources Control Board. www.lao.ca.gov 5 analysis full gutter AN LAO REPORT allow the federal Central Valley Project and State that will affect statewide water usage and drought Water Project to modify the volume and timing of resilience on an ongoing basis. Of these, the reservoir releases. These steps were taken with the most significant was the Sustainable Groundwater intent of both maximizing the amount of water the Management Act of 2014—Chapters 346 (SB 1168, projects could deliver and addressing the needs of Pavley), 347 (AB 1739, Dickinson), and 348 migrating fish. (SB 1319, Pavley)—which represented California’s Improving Water Conservation Was Major first comprehensive statewide requirement to Focus During Drought. One of the most publicized monitor and operate groundwater basins to avoid short-term policies implemented during the 2012 to depletion. Local agencies still are in the early 2016 drought was Governor Brown’s call for a stages of implementing the requirements of this 25 percent statewide reduction in urban water act, with the goal of balancing the extraction from use. In response to direction from an executive and replenishment of the most critically overdrafted order, SWRCB passed emergency regulations groundwater basins by 2040. (Other high- and implementing temporary water conservation medium-priority basins are required to reach requirements for urban potable water users, sustainability by 2042.) Other notable permanent including certain limitations on outdoor irrigation. policy changes adopted during the drought Specific reduction requirements varied across water included authorizing SWRCB to consolidate supply agencies from 4 percent to 36 percent small water systems that consistently fail to meet compared to 2013, depending on previous usage drinking water standards, as well as requiring that levels. The restrictions were modified in June 2016 surface water rights holders measure and report and then ended in April 2017 when statewide water on the amount of water they divert from the state’s conditions improved and Governor Brown lifted the streams and rivers. Both of these changes were statewide emergency proclamation. Consequently, included in Chapter 27 of 2015 (SB 88, Committee in 2018, the Legislature enacted legislation that on Budget and Fiscal Review). Additionally, DWR surpassed previous statutory water reduction (working through the regulatory authority of the targets to better position local water agencies to California Water Commission) increased state withstand future dry periods. Previous legislation requirements for water efficiency in new and had established a goal of reducing statewide urban retrofitted outdoor landscapes. water use by 20 percent between 2009 and 2020, While it was adopted a few years after the which had already been met and exceeded by drought ended, Chapter 120 of 2019 (SB 200, 2018. Chapters 14 (SB 606, Hertzberg) and 15 Monning) was developed partially in response to (AB 1668, Friedman) of 2018 included requirements the drinking water shortages that were exacerbated that urban water agencies develop and meet new during the drought. That legislation established water use efficiency objectives based on their the Safe and Affordable Drinking Water Fund, local conditions, and added new components to which provides up to $130 million annually from urban and agricultural water management planning the Greenhouse Gas Reduction Fund for efforts activities. The legislation requires local agencies to to provide safe drinking water for every California meet their new water use objectives by 2027. community. (For more information on that legislation State Also Adopted Some Permanent Policy and its implementation, please see our November Changes to Respond to Droughts. In addition 2020 report, Expanding Access to Safe and to its actions on water conservation, California Affordable Drinking Water in California—A Status adopted a number of other permanent statutory Update.) changes in response to the 2012 to 2016 drought 6 LEGISLATIVE ANALYST’S OFFICE analysis full gutter AN LAO REPORT UPDATE ON CURRENT CONDITIONS State Is Experiencing Another Multiyear Dry in December. (The federal Central Valley Project Period. California experienced below average announced to its agriculture service water precipitation in 2020—receiving only roughly contractors that they may not receive any water 60 percent of the rain and snow that falls in a deliveries this year.) Around the same time, SWRCB normal year. So far, 2021 is shaping up to be even mailed early warning notices to approximately drier. As of May 10, 2021, precipitation levels were 40,000 water right holders, urging them to plan tracking at 48 percent of average for the year in the for potential shortages by reducing water use and Northern Sierra region, 49 percent in the mid-Sierra adopting conservation measures. San Joaquin region, and 36 percent further south in Governor Declared Drought Emergency, the Tulare Basin region. At this point in the “water Proposes $5 Billion in New Spending. On year” (which measures precipitation from October April 21, 2021, the Governor declared a regional through September each year), 2020-21 represents drought emergency in Mendocino and Sonoma the third driest year on record, with little chance Counties due to extremely dry conditions in the of significant additional precipitation on the Russian River watershed. That proclamation horizon until the fall. Current snowpack levels are also directed state agencies to take actions to roughly 9 percent of normal for this time of year prepare for worsening conditions statewide, such for the Northern and Central Sierra regions, and as by working with local governments to identify only 4 percent of normal for the Southern Sierra. watersheds, communities, public water systems, Moreover, all of the major reservoirs across the and ecosystems that may require coordinated state state currently contain less water than historical and local actions to address drought impacts. average levels this date, with the two largest— On May 10, 2021, the Governor expanded this Shasta and Oroville—at 56 percent and 50 percent emergency proclamation to apply to an additional of average levels, respectively. In many of the 39 counties, and directed SWRCB to consider state’s major rivers—including the Feather and modifying requirements for reservoir releases American Rivers, and the inflow into Shasta Lake— and water diversions in order to balance the current flow rates are currently tracking below the water needs of households, farmers, and the runoff levels for the same date in 2014 and 2015. environment. In addition, the Governor announced State Has Taken Some Initial Steps in that his May Revision budget proposal contains Response to Dry Conditions. In March 2021, $5.1 billion over four years in water-related DWR announced that the State Water Project expenditures, including for both long-term water expects to deliver just 5 percent of requested supply infrastructure projects and for immediate supplies to its water contractors this year, down response activities. from an initial allocation of 10 percent announced LESSONS FOR THE CURRENT DROUGHT Administration Recently Released Report (3) efforts in which the state achieved notable Summarizing Lessons From the Previous successes, (4) efforts in which the state needs to Drought. In March 2021, the California Natural make improvements, and (5) recommendations for Resources Agency (CNRA) released a legislatively improving the state’s response in the future. The required report that summarized the following report focuses on recommendations that should information pertaining to the 2012 to 2016 be implemented by state departments and does drought: (1) major drought response activities not concentrate on suggested legislative actions. undertaken, (2) major challenges encountered, Nevertheless, it provides a helpful starting place www.lao.ca.gov 7 analysis full gutter AN LAO REPORT for discussions regarding how the state should such proposals and their potential impacts respond to the escalating conditions it currently ahead of time could avoid some delays if is confronting. Some of the key recommendations it becomes clear that such transfers are included in the report are to: necessary. Similarly, the Legislature could direct that state departments get contracts • Provide earlier notice and longer lead times to in place now for anticipated needs, such as local agencies for applying for state financial for local providers of emergency drinking assistance. water supplies in well-dependent San Joaquin • Dedicate staff to ongoing drought Valley communities. preparedness and response work. • Coordination and Efficiency of State • Better account for wildlife needs before and Departments Is Key. As discussed earlier, during droughts. numerous state departments were involved • Improve the quality and timeliness of in responding to the 2012 to 2016 drought, forecasting and data. including several departments that undertook • Restore forest health in upper watersheds. similar efforts. For example, as shown in Figure 3, three different departments— Key Issues for the Legislature to Consider in DWR, SWRCB, and OES—were funded to Confronting the Current Drought. The impacts respond to drinking water shortages, and California experienced and actions it undertook two departments—OES and the California during the most recent severe drought can and Department of Forestry and Fire Protection— should help inform how the state responds to the received funding for removing dead trees. emerging drought. For example, the state can seek To most effectively respond to immediate to replicate successful practices, avoid previous and emerging challenges, the state should mistakes, and target past areas of concern for ensure that departments have clearly defined early intervention before they become crises. Along responsibilities, avoid duplication, and ensure these lines, Figure 4 summarizes some key issues that all state entities are working in close for the Legislature to keep in mind as it considers how to address Figure 4 increasingly dry conditions, and Lessons to Inform the State’s Response to the we discuss each point in greater Current Drought detail below. 9 • Taking Action Soon Can Taking Action Soon Can Help the State Address Issues Before Help the State Address Conditions Worsen Issues Before Conditions 9 Worsen. While the severity The Coordination and Efficiency of State Departments Is Key and length of the emerging 9 Large Water Supply Investments Typically Are Not Able to Address drought still is unknown, Urgent Conditions taking actions now can 9 prepare the state for a more Because of Its Flexibility, the General Fund Is Usually the Best Fit for effective and expedient Emergency Response Activities response if conditions 9 Ongoing Drinking Water Challenges Become Compounded During escalate. For example, Droughts state agencies could begin to accept and review 9 Rural, Vulnerable Communities Are Particularly Affected by Drought applications for potential 9 water transfers among users The State Has the Responsibility to Help Protect Fish and Wildlife now, before they are needed. 9 Spending time reviewing Drought Conditions Increase the Risk of Severe Wildfires 8 LEGISLATIVE ANALYST’S OFFICE analysis full gutter AN LAO REPORT coordination. This could involve formalizing when they can be spent, making them more and providing explicit funding to support flexible and accessible for meeting varied an interagency drought task force, as was and evolving needs. As such, in the coming established by Governor Brown during the last months—and, potentially, years—the General drought and recently reconvened by Governor Fund likely will be a key funding source for Newsom. This issue was also highlighted addressing urgent drought conditions. in CNRA’s recent report, which called for • Ongoing Drinking Water Challenges hiring dedicated drought response staff at Become Compounded During Droughts. key departments. Currently, over one million Californians • Large Water Supply Investments Typically lack access to safe and affordable drinking Not Able to Address Urgent Conditions. water that meets established water quality Because large projects—such as water standards. These conditions worsened recycling, treatment, and desalination during the last drought, when thousands facilities—take time to plan, permit, finance, of wells serving residential homes dried up and construct, initiating new water supply or became affected by contaminants that projects during a drought generally will emerged in the underlying aquifers. While the not help to alleviate current conditions. As Legislature established a new program and such, if the Legislature is most concerned fund to make progress on these issues, as with addressing pressing water shortages the drought worsens it should be prepared and emergency conditions, providing for problems to again become exacerbated funding for large, long-term projects is not by dry conditions and increased agricultural the most effective strategy. However, such groundwater pumping. Steps the state could projects could help to improve resilience to consider taking include (1) more regular subsequent droughts. As noted, the state monitoring of groundwater quality and spent heavily on water supply projects during levels in at-risk areas to identify emerging the previous drought. While comprehensive problems, (2) pre-positioning emergency data are not yet available on how those drinking water supplies in areas where investments increased overall statewide water problems are anticipated, and (3) providing supplies, the funded projects should help additional staff and funding to respond when put the communities that received grants problems develop. and undertook projects in better positions to • Rural, Vulnerable Communities Particularly weather the emerging drought. Affected by Drought. The communities • Because of Its Flexibility, General Fund most impacted by drinking water challenges Usually Best Fit for Emergency Response during the last drought were small and rural; Activities. While bonds were the largest many were farmworker communities located source of state funds for drought-response in California’s Central Valley. Moreover, activities between 2013-14 and 2016-17, many of the communities that lost—or most of that funding was used for longer-term remain vulnerable to losing—access to safe water supply projects. This is because bond drinking water contain high proportions of language typically limits expenditures to both lower-income and Latino residents. certain types of capital projects and, as noted, In addition to drinking water impacts, those generally take a long time to plan and decreased agricultural production due to implement. In contrast, the state used General limited water supplies can negatively impact Fund monies to support most emergency the economies in the affected regions. response activities, with additional—and Because the last drought revealed that these lesser—support from numerous special funds. vulnerable communities and populations are In general, this approach was due to General disproportionately affected, the Legislature Fund dollars not being as limited in how and may want to focus spending and assistance www.lao.ca.gov 9 analysis full gutter AN LAO REPORT specifically on mitigating such impacts. This is its responsibility to manage public trust particularly true given that many households resources—including fish, wildlife, and in this region likely already are struggling waterways—on behalf of all Californians, the from the impacts of coronavirus disease Legislature will need to continually balance the 2019 (COVID-19), which research shows also needs of both humans and the environment had disproportionate economic impacts on when making water management and lower-income communities of color. While the drought response decisions. For example, the state did provide some assistance specifically Legislature could consider providing resources for farmworker communities during the last to CDFW for additional staff and equipment to drought, not all of it was well-targeted. For closely monitor streams where temperatures example, CNRA’s recent drought report notes and flows became dangerous for sensitive fish that there was relatively low interest in a state during the last drought. This would allow the program that provided temporary relocation department to identify problems and intervene due to drought-related job losses, because before conditions become too dire. many residents—understandably—preferred • Drought Conditions Increase Risk of Severe to remain in their communities or make more Wildfires. The last drought revealed that permanent arrangements to settle elsewhere. not only does a lack of precipitation result in • State Has Responsibility to Help Protect water shortages, it also has major impacts on Fish and Wildlife. As was evident during the the state’s forests. An estimated 129 million last drought, the impacts of dry conditions trees died in California’s forests between are not limited to humans; they also have 2010 and 2017 due to a combination of low significant harmful effects on the environment. moisture, high temperatures, and resulting Moreover, certain drought response decisions bark beetle infestations. These dead trees that benefit humans have the potential to provided fuel for and likely exacerbated amplify negative impacts for fish and wildlife. several severe wildfires during and following One example of this dynamic occurred the drought. Given these previous trends, the during the last drought when water was Legislature should probably be prepared for released from the Shasta reservoir for urban the state to experience a need for increased and agricultural users early in the summer. tree removal and fire response activities—and This resulted in less and warmer water in associated costs—if the drought continues. the Sacramento River later in the summer, The state may also want to conduct increased which directly contributed to the death of monitoring on tree conditions in potential 95 percent of juvenile winter-run Chinook high-risk areas to identify trends and intervene salmon in both 2014 and 2015—practically early, such as by removing some dead and eliminating two out of three existing cohorts dying trees before fires are ignited. of this endangered species. Because of CONCLUSION Significant State Funding Surplus Could are tracking significantly higher than originally Help Support Drought Response, but Certain forecast, even compared to the Governor’s Spending Limitations Exist. Unlike in 2012, when January budget estimates. These positive trends the state budget was still recovering from the great provide additional resources that the Legislature recession, California is entering this new drought could choose to dedicate to drought response in a very healthy fiscal condition. Recent economic activities as part of the 2021-22 budget—as the data show that the state’s General Fund revenues Governor is proposing—and/or in future months 10 LEGISLATIVE ANALYST’S OFFICE analysis full gutter AN LAO REPORT and years depending upon how conditions develop. a two-thirds vote and the funds are deposited in a Of course, the Legislature will want to consider dedicated emergency response fund. funding such activities within the context of its Previous Experiences Can Provide Lessons numerous other budget priorities, including helping for Addressing Both Current and Future California households and businesses recover from Droughts. Current conditions in the state’s the economic effects of the COVID-19 pandemic, reservoirs, streams, and rivers are concerning. mitigating the growing risk of severe wildfires, The state, however, is becoming increasingly and addressing long-standing statewide issues experienced in responding to dry conditions. The like housing affordability and homelessness. events of 2012 through 2016 provided California Additionally, as we discuss in our recent report, The with a recent opportunity to learn how to effectively State Appropriations Limit, constitutional provisions anticipate, identify, and respond to the widespread likely will place significant constraints on how impacts that droughts can have on the state’s the state can spend surplus funding in 2021-22 residents, agricultural sector, and environment. and future years. However, spending for some Moreover, climate scientists suggest that droughts drought-related activities could be exempted from will become more frequent and intense in California these limitations under certain circumstances, such as the planet continues to warm. As such, learning as if funding is dedicated towards capital outlay from and improving upon past successes and projects. Given that the Governor has declared challenges will be important not only for the coming a drought emergency, spending also could be months—and, potentially, years—as the current dry exempted if the Legislature appropriates funds with period continues, but also for the inevitable future droughts the state will have to confront. LAO PUBLICATIONS This report was prepared by Rachel Ehlers, and reviewed by Brian Brown and Anthony Simbol. The Legislative Analyst’s Office (LAO) is a nonpartisan office that provides fiscal and policy information and advice to the Legislature. To request publications call (916) 445-4656. This report and others, as well as an e-mail subscription service, are available on the LAO’s website at www.lao.ca.gov. The LAO is located at 925 L Street, Suite 1000, Sacramento, CA 95814. 11 LEGISLATIVE ANALYST’S OFFICE