BILL ANALYSIS
AB 1527
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Date of Hearing: May 20, 2009
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Kevin De Leon, Chair
AB 1527 (Lieu) - As Introduced: February 27, 2009
Policy Committee:
TransportationVote:11-0
Urgency: No State Mandated Local Program:
No Reimbursable: No
SUMMARY
This bill allows a motor vehicle emissions reduction project to
be funded from multiple programs, including the Carl Moyer
Program and the Proposition 1B Goods Movement Emission Reduction
Program. This bill will be amended to add specificity.
FISCAL EFFECT
Cost pressure, potentially in the millions of dollars annually,
to allow bond proceeds or other monies to fund Carl Moyer and
goods movement projects. (Various special funds)
COMMENTS
1)Rationale . The author and sponsor seek funding flexibility so
that a project under consideration for the Prop 1B goods
movement program or Carl Moyer program would not risk losing
funding from those programs if it also received funding from
another state clean air/vehicle program.
2)Background .
a) The Carl Moyer Program Pays to Reduce Diesel Emissions .
The Carl Moyer Program, administered by the Air Resources
Board (ARB), provides grants to fund the incremental cost
of cleaner-than-required heavy-duty engines. Carl Moyer
has funded the incremental cost of a diverse range of
project types, including purchase of new alternative-fuel
heavy-duty vehicles (primarily transit buses and trash
trucks) and engine replacements or agricultural irrigation
pumps, construction equipment, and marine vessels.
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According to ARB, these projects have reduced smog-forming
nitrogen oxide (NOx) emissions by over 18 tons per day and
toxic diesel particulate matter (PM) emissions by almost 1
ton per day, with a cost-effectiveness of about $2,600 per
ton of NOx reduced. Funding for Carl Moyer is conditioned
upon a cost-effectiveness threshold.
b) Proposition 1B Funds Emissions Reductions From Goods
Movement . Proposition 1B (The Highway Safety, Traffic
Reduction, Air Quality, and Port Security Bond Act of 2006)
authorizes the state to sell $20 billion in general
obligation bonds for a variety of purposes. Among these
purposes is the reduction of air emissions associated with
the movement of goods on the state's trade corridors, for
which this bill provides $1 billion.
c) AB 118 Funds Air Quality Improvement, Technology, and
Fleet Modernization . AB 118 (Chapter 750, Statutes of
2007, N??ez) temporarily raises various vehicle and vessel
registration fees and smog abatement fees. The statute
created three new accounts into which the resulting revenue
is to be placed. AB 118 directs that revenues from the fee
increases be placed into thed) accounts in order to pay for
new programs, as follows:
i) Alternative and Renewable Fuel and Vehicle
Technology Fund . With estimated annual revenues of
about $100 million, this fund is to provide resources to
the Energy Commission for financial awards to further the
development and commercialization of technologies for
renewable and nonpetroleum fuels that help to achieve the
state's climate change goals. In addition, statute
requires that $10 million be transferred every year from
the fund to the Energy Commission-administered Public
Interest Research Development and Demonstration Fund.
ii) Air Quality Improvement (AQI) Fund . Bringing in
about $50 million each year, the AQI Fund is to provide
resources for ARB to award competitive grants for air
quality improvement projects related to fuel and vehicle
technologies.
iii) Enhanced Fleet Modernization Subaccount . With
annual revenues of about $30 million, this subaccount of
the High Polluter Removal and repair Account are to be
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used by the Bureau of Automotive Repair, in consultation
with ARB, to provide financial compensation for the
retirement of high-polluting California vehicles.
1)Supporters , including transportation industry groups, contend
more flexibility in the administration of air quality vehicle
emission programs will enable realization of more or
more-effective emission reduction projects. In addition,
supporters, noting the problems they face in this especially
difficult economy, problems compounded by ARB's
"ill-conceived" air quality regulations, seek additional
funding for vehicles upgrades and retrofits.
2)Opposition . There are no registered opponents to this bill.
However, the policy committee analysis observes that opponents
to this bill object that diesel emission reductions
anticipated from Carl Moyer and Prop 1B could be sacrificed,
should AB 118 funds be commingled with funds from those
programs.
Analysis Prepared by : Jay Dickenson / APPR. / (916) 319-2081