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124 Part I California Water maintaining affordability,positions these utilities relatively well for the challenges of upgrading aging infrastructure,a perennial challenge for utilities(Chapter 3). Flood management Flood management faces greater financial difficulties.This sector traditionally has relied on federal cost-sharing (typically 65 percent, sometimes higher), and local entities are now subject to public votes for raising local assessments under Proposition 218. Although no comparable exercise exists to estimate statewide flood control spending needs, the Department of Water Resources estimates that the minimum cost of restoring the Sacramento-San Joaquin Flood Control Projects is more than$20 billion (M.Inamine,DWR,personal communication).58 This estimate does not include upgrading the system to a higher level of protection, as mandated by the new flood legislation passed in 2007, nor does it include flood-related investment needs in other parts of California,many of which are also vulnerable. In recent decades, federal investments in California flood protection have been modest, leaving Californians to shoulder most of this financial burden.State flood protection funds have come from general obligation bonds ($5 billion from Propositions 1E and 84—see Table 2.9)and other general fund resources(such as emergency levee repair legislation).State bond funding has put California well ahead of the U.S.Army Corps of Engineers,although bond sales were limited by the onset of the recession (Figure 2.16). Over the longer term, the bigger problem will be raising new sources when the bonds are exhausted, given the vast unfunded capital needs.As discussed in Chapter 6,new forms of regional or statewide risk-based assessments or fees will be needed. Environmental mitigation Although the estimated funding requirements for environmental mitigation are smaller than those in the flood management sector, the management of polluted stormwater and other types of runoff face similar challenges because of Propositions 218 and 26. City and county governments are required by law to meet Clean Water Act standards regarding these nonpoint sources of pol- lutants,yet they are required to go to voters to raise the necessary funding— a difficult task when the problems caused by pollution occur downstream rather than close to home (Hanak and Barbour 2005). 58. For comparison purposes,the New York Times reports the cost of levee system reconstruction in New Orleans at $15 billion(Schwartz 2010).