LOS ANGELES - Lawmakers from California's central coast introduced a bill in the state Senate that would allow the Monterey Peninsula Water Management District to issue water rate relief bonds.

Senate Bill 936, introduced by Sen. Bill Monning, D-Carmel, would authorize the California Public Utilities Commission to allow the district to issue the bonds to finance a portion of the California American Water Company Monterey Peninsula Water Supply Project.

"I am honored to author this legislation as it is designed to protect rate payers by potentially providing an additional financing option for the construction of a desalination facility," Monning said in a statement.

Cal-Am proposed the construction of a desalination plant as a way to meet the reduction in water supply mandated in an order from the State Water Resources Control Board. The plant, as well as conveyance and storage facilities, is estimated to cost between $277 million and $320 million.

In addition to a desalination facility, the water project also includes the construction of slant intake wells and related facilities, including water pipelines and disposal facilities.

"In July, sixteen different groups, including elected officials and environmental and business leaders, agreed to pay for part of the desalination project with public funding," said Robert MacLean, President of California American Water. "This legislation will make that contribution possible, which provides a direct benefit to our customers."

The bond issuance would generate ratepayer savings estimated to be more than $8 million in the first year, and a cumulative savings of up to $66 million, according to a release from Monning's office.

Other authors of the bill include Sen. Anthony Cannella, R-Ceres, and Assemblymembers Mark Stone, D-Scotts Valley, and Luis Alejo, D-Watsonville.

SB 396 was introduced on Feb. 3 and will be referred to a Senate policy committee for a hearing.

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