Joint powers agreements: water corporations.

Assembly Member Blanca Rubio's legislation expands California's joint powers agreement framework to enable water corporations to participate in insurance and risk pooling arrangements alongside mutual water companies and public agencies.

The bill establishes specific requirements for these new collaborative arrangements. Water corporations must demonstrate that joint powers agreements provide greater customer benefits than existing insurance policies before receiving Public Utilities Commission approval. The agreements must maintain 100% reinsurance coverage with no joint liability or financial obligations for participating members. Any cost savings achieved through these arrangements must be directed toward reducing customer rates or improving services.

To ensure accountability, participating water corporations must submit initial documentation of historical insurance costs and file annual reports detailing realized savings and customer benefits. The legislation prohibits water corporations from joining joint powers agreements unless a mutual water company is already participating, and restricts these agencies from exercising powers beyond insurance provision and risk pooling. The Public Utilities Commission maintains oversight authority to verify that arrangements comply with customer benefit requirements.

The measure includes provisions to protect public agency participants, requiring indemnification against underlying debts and liabilities of joint powers agencies. Revenue generated through insurance activities may only fund necessary operations and support services aimed at reducing risk exposure and enhancing members' technical and managerial capabilities.