BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                  SB 459
                                                                  Page  1

          Date of Hearing:   August 21, 2013

                        ASSEMBLY COMMITTEE ON APPROPRIATIONS
                                  Mike Gatto, Chair

                    SB 459 (Pavley) - As Amended:  August 5, 2013 

          Policy Committee:                              
          TransportationVote:11-5

          Urgency:     No                   State Mandated Local Program:  
          No     Reimbursable:               

           SUMMARY  

          This bill establishes an outreach campaign to encourage  
          replacement of older high-polluting vehicles and requires  
          updating of the Enhanced Fleet Modernization Program (EFMP)  
          guidelines. Specifically, this bill:

          1)Requires the Air Resources Board (ARB), in collaboration with  
            the Bureau of Automotive Repair (BAR) and local air districts,  
            to conduct a one-year multilingual outreach program in federal  
            non-attainment areas in order to increase use by low-income  
            owners of the vehicle replacement portion of the EFMP.

          2)Requires the ARB to contract with a district or grass roots  
            community network to implement a community-based outreach  
            effort.

          3)Makes implementation of the above subject to appropriation by  
            the Legislature, through a transfer from the Vehicle  
            Inspection and Repair Fund to the High Polluter Repair or  
            Removal Account.

          4)Requires the board, within two years following the  
            appropriation, to report on the costs and benefits of the  
            program, as specified.

          5)Requires the ARB, by January 1, 2015, and in consultation with  
            the BAR to update the EFMP guidelines, as specified, including  
            coordination of the vehicle retirement and replacement  
            components with BAR's Consumer Assistance Program (CAP) to  
            maximize participation by persons eligible under both  
            programs.








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           FISCAL EFFECT  

          1)The extent of the outreach campaign is undefined, but  
            contracts for such a campaign in the non-attainment areas  
            would likely result in a one-time cost in the low millions of  
            dollars.

          2)The ARB would incur costs of $400,000 for two years, beginning  
            in 2014-15, for 2.5 positions to define the scope of the  
            campaign and develop and monitor contracts, respond to  
            increased hotline call volumes resulting from the campaign,  
            incorporate lessons learned from the campaign into the  
            program, complete the outreach program evaluation report, and  
            update the program guidelines, as specified, and implement  
            program modifications consistent with the guidelines.

            Per the bill's provisions, funding for the outreach program is  
            subject to appropriation from the Vehicle Inspection and  
            Repair Fund, which is projected to have a balance of about $54  
            million as of July 1, 2014.

          3)Costs for BAR to consult with the ARB should be minor and  
            absorbable.

           COMMENTS  

           1)Background  . Current law establishes CAP for the voluntary  
            retirement of high-polluting passenger vehicles and light to  
            medium duty trucks from operation in the state through the  
            purchase and dismantling of these vehicles.  This program is  
            available to owners when their vehicles fail to pass the smog  
            check inspection. Under CAP, low-income vehicle owners can  
            receive $1,500 to retire their vehicle.

            The EFMP provides for the voluntary retirement of passenger  
            vehicles and light and medium duty trucks that are high  
            polluters. Under the EFMP, vehicles do not have to fail smog  
            inspection in order to be eligible for EFMP benefits, whereby  
            eligible low-income vehicle owners can qualify for a $2,500  
            voucher to be used toward the purchase of a newer vehicle (up  
            to eight years old).

           2)Purpose  . The author notes that under EFMP, 90% of the  
            approximately $30 million available for the program annually  








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            has been spent for vehicle retirement, but very little of that  
            money has been spent to provide vouchers to help individuals  
            purchase new, cleaner vehicles.  According to the author, the  
            available funding allowed BAR to retire over 12,000  
            high-polluting vehicles in the program's first year, but to  
            date, only 12 vouchers have been issued. The author has  
            introduced this bill which would help to make the current  
            vehicle retirement program more accessible, convenient, and  
            financially feasible for low income vehicle owners.

           3)Related Legislation  . SB 11 (Pavley), also on today's committee  
            agenda, extends fees for air pollution reduction programs,  
            including the EFMP.

           Analysis Prepared by  :    Chuck Nicol / APPR. / (916) 319-2081