BILL ANALYSIS SB 535 Page 1 Date of Hearing: July 15, 2009 ASSEMBLY COMMITTEE ON APPROPRIATIONS Kevin De Leon, Chair SB 535 (Yee) - As Amended: July 6, 2009 Policy Committee: TransportationVote:9-2 Urgency: No State Mandated Local Program: Yes Reimbursable: No SUMMARY This bill allows certain highly fuel-efficient vehicles to travel in high-occupancy vehicle (HOV) lanes without the required number of passengers, beginning in 2011. Specifically, this bill: 1)Requires the DMV, upon request and payment of the required fee, to issue distinctive decals to the owners of vehicles meeting the state's enhanced advanced technology partial zero-emission vehicle (enhanced AT PZEV) standard that have a 65 miles per gallon or greater combined fuel economy rating. The total number of such stickers is limited to 65,000. 2)Allows vehicles displaying these stickers to travel in HOV lanes, regardless of whether they meet the lanes' occupancy requirements, but does not exempt such single-occupant vehicles from tolls in high-occupancy toll (HOT) lanes to be operated on State Routes 10 and 110 by the Los Angeles County Metropolitan Transportation Authority under a congestion pricing pilot program authorized in current law. 3)Makes the above effective from January 1, 2011 until the earlier of January 1, 2015 or at any time that the Secretary of State receives notice from Caltrans that federal law does not authorize HOV lane access for single-occupant vehicles with such stickers. 4)Extends the January 1, 2011 sunset for current HOV lane privileges for vehicles that meet the state's super ultra-low emission vehicle (SULEV) standard for exhaust emissions and the federal inherently low-emission vehicle (ILEV) evaporative SB 535 Page 2 emission standard until the Secretary of State receives the same notice as in (3). FISCAL EFFECT Minor costs to the DMV to issue decals up to the authorized limit, fully offset by fees charged to vehicle owners. COMMENTS 1)Background . An HOV lane, commonly referred to as a "carpool" or "diamond" lane, is part of a traffic management strategy designed to reduce the number of single occupancy vehicles during peak periods of traffic congestion. These lanes are intended to provide an incentive for commuters to form carpools by offering reduced travel times. AB 71 (Cunneen)/Chapter 330 of 1999, extended to certain "Clean Air" vehicles the privilege of using HOV lanes even when required occupancy levels are not met. Vehicles meeting AB 71's standard are generally limited to battery-powered vehicles and those operating on compressed natural gas, neither of which is especially prevalent in California's vehicle fleet. AB 2628 (Pavley)/Chapter 725 of 2004, extended the Clean Air provisions of AB 71 to hybrid vehicles that achieve 45 miles per gallon fuel economy. Since allowing large numbers of hybrids into HOV lanes would reduce the effectiveness of the lanes, AB 2628 limited the aggregate number of stickers for hybrids to 75,000 and allowed Caltrans to suspend HOV lane privileges for hybrids on any particular lane that reaches a specified level of congestion. AB 2600 (Lieu)/Chapter 614 of 2006, increased the limit on hybrid stickers to 85,000 and extended AB 2628's 2008 sunset date to 2011. (The DMV reached the 85,000 sticker cap for hybrids in February 2007 and is no longer issuing new hybrid stickers.) In June of 2007, the Federal Highway Administration (FHWA) requested Caltrans to submit a plan to address "HOV lane degradation" on California freeways. Caltrans' analysis had indicated that 54% of its HOV lanes had experienced such degradation-i.e. the lane does not maintain 45 mph or greater operating speed during peak commute hours for 90% or more of 180 consecutive workdays. Recognizing that one component of HOV lane congestion may be the presence of hybrid vehicles, one of the options that Caltrans is considering is banning SB 535 Page 3 hybrids in certain HOV lanes, as it is already authorized to do. Furthermore, absent action by Congress, the current federal authorization for non-HOVs operating in HOV lanes with Clean Air stickers is due to expire on September 30 of this year. (Recently-introduced legislation would extend the expiration to 2015.) 2)Purpose . This bill allows the DMV to issue up to 65,000 Clean Air stickers to "enhanced AT-PZEV" vehicles that achieve a combined fuel economy rating of 65 MPG-commencing on the January 1, 2011 sunset of the existing authorization for 85,000 fuel-efficient hybrids to operate in HOV lanes. According to the author, at least five new vehicles meeting this bill's standard are poised to enter the market: the Chevy Volt, Fisker Karma, and Chrysler ReEV "range extended electric vehicles" and the Ford Escape and Toyota Prius plug-in hybrids. Given the potential for such vehicles to reduce oil dependency, reduce air pollution and counter the emission of greenhouse gasses, the author believes the granting of HOV lanes privileges is an appropriate incentive to potential buyers of such vehicles. 3)Related Legislation . AB 1500 (Lieu), pending in Senate Appropriations, extends, until January 1, 2016, the sunset date for SULEV and ILEV vehicles to use HOV lane without the required number of passengers. Analysis Prepared by : Chuck Nicol / APPR. / (916) 319-2081