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.