Senate BillNo. 459


Introduced by Senator Pavley

February 21, 2013


An act to add Section 44266 to the Health and Safety Code, relating to vehicular air pollution.

LEGISLATIVE COUNSEL’S DIGEST

SB 459, as introduced, Pavley. Fuel-efficient vehicles: financial incentives: middle-income households.

Existing law requires the State Air Resources Board (state board), in conjunction with the State Energy Resources Conservation and Development Commission (energy commission), to develop and administer a program to provide grants to individuals, local governments, public agencies, state agencies, nonprofit organizations, and private businesses, to encourage the purchase or lease of a new zero-emission vehicle.

This bill would require the state board, in consultation with the energy commission, air pollution control and air quality management districts, and the Bureau of Automotive Repair, to submit a specified plan to the Legislature that identifies opportunities to utilize existing legal authorities to reduce fuel expenditures by middle-income households by accelerating the adoption of more fuel-efficient vehicles, as specified. The bill would require the state board to convene an advisory board to provide guidance in developing the plan, as specified.

Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no.

The people of the State of California do enact as follows:

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SECTION 1.  

The Legislature finds and declares all of the
2following:

3(a) Millions of residents are stuck in an energy trap without
4access to alternatives and are forced to spend more of their income
5on gasoline, repairs and maintenance, and financing for their cars
6than they spend on food, healthcare, and other critical expenses.

7(b) The average household spends $8,300 on transportation
8every year, nearly $2,000 more than is spent on food, and $5,000
9more than is spent on health care.

10(c) In 2011, residents spent more than $1 billion on gasoline
11every week, of which almost two-thirds left the state.

12(d) A resident who drives a 32-mile-per-gallon car instead of
13the average new vehicle will save over $3,000 in fuel expenses
14over five years, the average duration of vehicle ownership, and a
15resident who drives a typical zero-emission vehicle will save over
16$9,000 in fuel over the same number of years.

17(e) Higher up-front purchase costs are one of the primary barriers
18to the adoption of more fuel-efficient vehicles, including low- and
19zero-emission vehicles.

20(f) There is a direct correlation between increases in gasoline
21prices and increases in market prices for fuel-efficient vehicles,
22making it more difficult for potential car buyers to purchase more
23fuel-efficient vehicles when they are needed most.

24(g) More fuel-efficient vehicles, including low- and
25 zero-emission vehicles, certified to more stringent emissions
26standards provide significant public health benefits by reducing
27emissions of smog-forming and toxic air pollution, and are a critical
28solution to persistent air quality problems, particularly in air basins
29that historically fail to meet multiple National Ambient Air Quality
30Standards.

31(h) Currently, the majority of new vehicle buyers and nearly 80
32percent of zero-emission vehicle buyers in the state earn over
33$100,000 annually.

34(i) Eighty percent of potential tax filers are unable to take full
35advantage of federal tax credits that reduce the purchase cost of
36plug-in electric vehicles.

37(j) Current automotive lending practices generally fail to account
38for the decreased risk of default and enhanced credit-worthiness
P3    1associated with buyers and lessors of more fuel-efficient cars,
2though some innovative creditors and nonprofit lenders have had
3success in the state and in other states issuing lower interest loans
4for fuel-efficient vehicles, including car buyers with subprime
5credit, who sometimes pay 30 percent interest on auto loans.

6(k) It is in the public interest of the state to help residents out
7of the energy trap and into more fuel-efficient cars, including low-
8and zero-emissions vehicles, to reduce fuel expenditures, improve
9access to jobs, increase disposable income, and deliver broader
10public health, environmental, and economic benefits to the state.

11

SEC. 2.  

Section 44266 is added to the Health and Safety Code,
12to read:

13

44266.  

(a) On or before November 1, 2014, the state board,
14in consultation with the State Energy Resources Conservation and
15Development Commission, districts, and the Bureau of Automotive
16Repair, shall submit a plan to the Legislature that identifies
17opportunities to utilize existing programs and funding sources to
18reduce fuel expenditures by middle-income households by
19accelerating the adoption of more fuel-efficient vehicles, including,
20but not limited to, low- and zero-emission vehicles.

21(b) (1) In developing the plan, pursuant to subdivision (a), the
22state board shall consider a wide range of opportunities, including,
23but not limited to, optimizing the use of existing funds, including
24the Air Pollution Control Fund, created pursuant to Section 43015;
25the Air Quality Improvement Fund, created by Section 44274.5;
26the Alternative and Renewable Fuel and Vehicle Technology Fund,
27created by Section 44273; the Vehicle Inspection and Repair Fund,
28created by Section 9886 of the Business and Professions Code;
29and the Greenhouse Gas Reduction Fund, created pursuant to
30Section 16428.8 of the Government Code.

31(2) Pursuant to paragraph (1), the state board shall consider all
32of the following, among other strategies, to cost-effectively
33optimize the use of existing special funds:

34(A) Whether automotive dealers and lenders can be offered
35enhanced incentives to sell or lease more fuel-efficient vehicles,
36including low- and zero-emission vehicles.

37(B) Whether consumer automotive loan terms can better reflect
38the correlation between vehicle fuel efficiency and loan
39performance, rewarding customers who choose more efficient
40vehicles with better terms that reflect reduced fuel expenditures.

P4    1(C) Whether public funds can be efficiently used to leverage
2more private investment.

3(D) Whether the value of federal tax credits for plug-in electric
4vehicle purchases can be passed through to households lacking
5sufficient federal tax liability to claim the credits.

6(E) Whether the Consumer Assistance Program, established
7pursuant to Section 44062.1 and administered by the Bureau of
8Automotive Repair, is achieving the maximum benefits.

9(F) Whether enhanced point-of-sale rebates for middle-income
10households can increase the adoption of more fuel-efficient
11vehicles, including low- and zero-emission vehicles.

12(c) (1) The state board shall convene an advisory board to
13provide guidance in developing the plan pursuant to subdivision
14(a).

15(2) Membership of the advisory board created pursuant to
16paragraph (1) shall include, but is not limited to, experts in banking,
17consumer finance, automobile manufacturing, public health,
18environmental protection, transportation policy, consumer
19protection, and automobile retailing.

20(3) The advisory board shall be subject to the Bagley-Keene
21Open Meeting Act (Article 9 (commencing with Section 11120)
22of Chapter 1 of Part 1 of Division 3 of Title 2 of the Government
23Code).



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