BILL ANALYSIS                                                                                                                                                                                                    




                   Senate Appropriations Committee Fiscal Summary
                           Senator Christine Kehoe, Chair

                                           2289 (Eng)
          
          Hearing Date:  08/09/2010           Amended: 08/02/2010
          Consultant: Mark McKenzie       Policy Vote: BP&ED  5-2; T&H 7-2
          _________________________________________________________________ 
          ____
          BILL SUMMARY:  AB 2289 would revise procedures for the smog  
          check program to require testing of model year 2000 and newer  
          vehicles using onboard diagnostic systems (ODB-II) beginning  
          January 1, 2013, and provide for referee inspections for  
          vehicles that present prohibitive or unusual inspection  
          circumstances.  The bill would require the Department of  
          Consumer Affairs (DCA) to establish inspection-based performance  
          standards that test-only and Gold Shield stations must meet to  
          issue certificates of compliance or non-compliance, and  
          prescribe a license suspension and appeals process for stations  
          not meeting the performance standards.  The bill would also  
          revise enforcement provisions and penalties for smog check  
          stations and technicians who violate provisions of the smog  
          check program.
          _________________________________________________________________ 
          ____
                            Fiscal Impact (in thousands)

           Major Provisions         2010-11     2011-12       2012-13     Fund
           DCA/ BAR regulations   $75        $125        $50       Special*

          BAR referee inspectionsall costs covered by inspection  
          feesSpecial*

          Administrative penalties          unknown, likely minor increase  
          in revenues            Special**

          ARB consultation       minor and absorbable costs        
          Special**
          ____________                                            
          * Vehicle Inspection and Repair Fund (VIRF)
          ** High Polluter Repair or Removal Account in the VIRF
          *** Air Pollution Control Fund
          _________________________________________________________________ 
          ____

          STAFF COMMENTS: 










          
          The Bureau of Automotive Repair (BAR) within DCA administers  
          California's smog check program, which began in 1982.  Existing  
          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.  All vehicles 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.  The smog check program requires both a tailpipe  
          emissions test and a visual inspection, which includes  
          inspection of a vehicle's OBD II system, for vehicles with a  
          model year of 1996 or newer.  Federal law requires all newer  
          vehicles to include an OBD II system, which monitors the  
          performance of the vehicle's emission control systems.  BAR  
          anticipates that OBD II-only testing will reduce the cost of  
          inspections from an average of about $48 today to around $20 for  
          consumers.
          Page 2
          AB 2289 (Eng)

          This bill would require BAR and DCA to adopt regulations for  
          revised testing procedures that allow for OBD-II testing and  
          identifying vehicles that present prohibitive and unusual  
          inspection circumstances, to establish inspection-based  
          performance standards for evaluating testing stations, and for  
          the revised and expanded enforcement provisions.  BAR indicates  
          that it has permanent staff in place to address any new  
          requirements for adopting regulations, and that any costs  
          related to updating or adopting regulations related to this bill  
          would be absorbable.  Staff estimates, however that the new  
          workload created by this bill would impose staffing costs in the  
          range of $250,000 over several years, some of which may not be  
          absorbable.  For instance, BAR would be required to have a "real  
          time" computer program in place by 2013 that would identify  
          irregularities and excessive variances in testing and adopt  
          procedures for handling those vehicles, BAR would be required to  
          establish performance-based inspection standards for evaluating  
          smog check stations and notify testing stations of those  
          standards by January 1, 2012, and BAR would need to adopt  
          regulations for the procedures and penalties related to the  
          revised enforcement provisions. 

          The California Air Resources Board would coordinate with BAR on  
          the adoption of revised testing procedures.  ARB indicates that  










          any costs associated with coordination with BAR would be  
          absorbable, and consistent with its current level of  
          consultation.  

          The bill also requires an annual evaluation of the performance  
          of the smog check program by BAR, in cooperation with the ARB,  
          using data collected from a roadside audit program, beginning  
          July 1, 2011.  BAR indicates that any costs to do the annual  
          report would be absorbable.

          Any penalty revenue derived from enhanced administrative fines  
          would be deposited into the High-Polluter Repair or Removal  
          Account within the Vehicle Inspection and Repair Fund.  These  
          revenues are not anticipated to be significant.