BILL ANALYSIS AB 2289 Page 1 Date of Hearing: May 12, 2010 ASSEMBLY COMMITTEE ON APPROPRIATIONS Felipe Fuentes, Chair AB 2289 (Eng) - As Amended: April 21, 2010 Policy Committee: TransportationVote:8-3 Urgency: No State Mandated Local Program: No Reimbursable: No SUMMARY This bill authorizes the Department of Consumer Affairs (DCA) to require smog check stations to use computerized onboard diagnostic systems for new vehicles and provides DCA with administrative and civil penalty authority. Specifically, this bill: 1)Authorizes DCA to require Smog Check stations to use onboard diagnostic (OBD) systems for vehicles model year 2000 and newer. 2)Provides for an alternative Smog Check test system for vehicles not equipped with second generation onboard diagnostic systems (OBD II) and vehicles with emission problems that may not be adequately detected by the vehicle's OBD II, as determined by DCA and the Air Resources Board (ARB). 3)Authorizes DCA to certify smog check stations that meet higher standards and that may inspect and certify problematic or especially polluting vehicles. 4)Allows DCA to impose an administrative fine, of no less than $100 and no more than $5,000 per violation, against a licensee, contractor, or fleet owner who violates Smog Check requirements and provides for appeal. Directs revenues to the High Polluter Repair or Removal Account (HPRRA) within the Vehicle Inspection and Repair Fund (VIRF). 5)Allows law enforcement officials, acting on behalf of DCA, to impose a civil penalty of not more than $5,000 for each day AB 2289 Page 2 the violation occurs, and specifies that any person who fraudulently attempts to obtain a certificate of compliance will be subject to a civil penalty of not more than $5,000. 6)Requires DCA, in consultation with ARB, to collect and analyze Smog Check data and make the analysis publicly available each year. FISCAL EFFECT 1) Annual costs to DCA, ranging from $350,000 to $450,000, to develop new Smog Check standards, certify test stations that meet higher standards, enforce compliance, and collect, analyze and publish data (VIRF). 2) Minor, absorbable costs to ARB to consult with DCA. COMMENTS 1)Rationale . The DCA and ARB (sponsors) contend this bill will save consumers time and money, improve consumer protection and reduce air pollution. This is because, according to the sponsors, OBD II equipment is less costly than conventional smog check equipment and allows, faster and more-accurate testing of a vehicle's emissions. The sponsors also contend the more-stringent standards for high performance Smog Check stations will ensure older, higher polluting vehicles not equipped with OBD II will receive accurate emissions testing and repair and the enhanced enforcement provisions will better guarantee program compliance, thereby reducing air pollution. 2)Background . a) Smog Check . The Bureau of Automotive Repair (BAR) within DCA administers California's Smog Check program, which began in 1982. State law requires California-registered gasoline-powered motor vehicles registered in areas of the state suffering from high levels of air pollution to have a Smog Check inspection every two years. In addition, all cars must be tested for emissions upon change of ownership and initial registration. BAR licenses two types of Smog Check test centers-test only centers, which cannot repair vehicles, and "gold shield" centers, which can make repairs. AB 2289 Page 3 California's Smog Check program includes two inspection procedures for 1996 and newer model-year vehicles: a tailpipe emission test and inspection of a vehicle's OBD II system. Federal law requires all newer vehicles to include an OBD II system, which monitors the performance of the vehicle's emission control systems. b) Effectiveness of OBD II. The Inspection and Maintenance Review Committee (IMRC) is created in law as an advisory body to review and evaluate the Smog Check program and to recommend program improvements. According to IMRC: i) The United States Environmental Protection Agency and state authorities have generally found, when compared to existing tailpipe testing procedures, OBD II systems are more effective in detecting emission-related malfunctions on in-use vehicles. ii) Vehicles are more than twice as likely to fail an OBD II-based inspection as the tailpipe emissions test. iii) Nearly every state besides California that has a smog check program relies exclusively on OBD II system inspections for 1996 and newer vehicles. c) Sierra Research-A Check on Smog Check . Operating under a contract with ARB, Sierra Research, Inc. conducted an analysis of the Smog Check program. Using data collected from 2003 to 2006, Sierra observed roadside emission inspection results for 1976-95 model year vehicles, which are not equipped with OBD II. Sierra then compared these results to inspection results for the same vehicles as reported by Smog Check stations. Of the vehicles sampled, 19% passed a tailpipe inspection at a licensed Smog Check station, but failed a roadside audit inspection within a year. In addition, Sierra found 49% of vehicles sampled that failed a roadside audit inspection had failed, and then subsequently passed, a tailpipe inspection at a Smog Check station within the past year. Sierra did not attempt to explain the discrepancy between the roadside test results and the Smog Check station test results. However, Sierra noted that if Smog Check stations were to achieve emissions test results in keeping with the observed roadside test results, vehicle emissions avoided because of the Smog Check program would increase by 30%. 3)Support . This bill is supported by ARB, BAR, and a numerous AB 2289 Page 4 environmental health organizations, who contend it will reduce costs to consumers and improve air quality. 4)Opposition . The bill is opposed by California Emissions Testing Industries and several other industry groups. These opponents contend this bill: a) Causes the loss of over 5,000 jobs and millions of dollars in economic activity. b) Ends the separation of Smog Check testing from vehicle repair, thereby threatening the livelihood of test-only center operators whose specialize businesses are not equipped to compete with full-service Smog Check centers. c) Threatens the integrity of the Smog Check program because of the unreliability of OBD II test results. Analysis Prepared by : Jay Dickenson / APPR. / (916) 319-2081