BILL ANALYSIS Ó
SB 459
Page 1
Date of Hearing: September 11, 2013
ASSEMBLY COMMITTEE ON TRANSPORTATION
Bonnie Lowenthal, Chair
SB 459 (Pavley) - As Amended: September 6, 2013
SENATE VOTE : 36-0
SUBJECT : Enhanced Fleet Modernization Program (EFMP)
SUMMARY : Directs the California Air Resources Board (ARB) to
take specific steps to improve the EFMP. Specifically, this
bill :
1)States the intent of the Legislature that ARB should take all
steps necessary to improve the EFMP to: increase the benefits
of the program to low-income Californians; promote cleaner
replacement vehicles; and enhance emissions reductions gained
by the program.
2)Allows vehicles that have been registered without a
substantial lapse in the state for at least two years prior to
retirement and that have failed a smog test qualify for the
Bureau of Automotive Repair's (BAR's) Consumer Assistance
Program (CAP).
3)Requires, by June 30, 2015, ARB in consultation with BAR, to
update the EFMP guidelines to:
a) Consider requiring that a vehicle take, complete, or
pass a smog check inspection;
b) Establish $1,500 as the minimum replacement compensation
for low-income vehicle owners and $1,000 as the maximum
compensation for all other vehicle owners;
c) Direct that compensation for either retired or
replacement vehicles for low-income vehicle owners may be
increased as necessary to maximize air quality benefits
while also ensuring low-income vehicle owner participation;
d) Provide that increases in compensation amount may be
based on factors including age of the vehicle, emissions
impact of the replacement vehicle, participation by
low-income vehicle owners, and location of the vehicle in
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areas of the state with the poorest air quality.
e) Provide that program eligibility may be limited on the
basis of income to ensure the program adequately serves
persons of low or moderate income.
f) Provide coordination between vehicle retirement and
replacement components of EFMP and CAP to ensure that
vehicle owners participate in the appropriate program to
maximize emissions reductions.
g) Streamline administration of EFMP to simplify
predication while protecting the accountability of money
spent.
h) Ensure vehicles eligible for retirement have sufficient
remaining life as demonstrated by proof of current
registration, passing a recent smog check inspection, or
passing another test similar to a smog check inspection.
4)Authorize ARB, when updating the EFMP, to study and consider
the following elements:
a) Methods of financial assistance other than vouchers;
b) An option for automobile dealerships or other used car
sellers to accept cars for retirement, provided the cars
are dismantled consistent with program requirements;
c) An incentive structure with varied incentive amounts to
maximize program participation and cost-effective emissions
reductions;
d) Increased emphasis on the replacement of high-polluting
vehicles with cleaner vehicles or increased use of public
transit that results in increased use of the vehicle
replacement program;
e) Increased emphasis on the reduction of greenhouse gas
emissions through the increased vehicle efficiency or
transit use as a result of the program; and,
f) Increased partnerships and outreach with community-based
organizations.
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EXISTING LAW :
1)Establishes the smog check program, administered by BAR and
the ARB and requires, generally, vehicles that are registered
in non-attainment areas for ozone or carbon monoxide pollutant
emissions to undergo biennial emission (smog check)
inspections.
2)Requires BAR, in consultation with ARB, to identify target
populations and disseminate information about the smog check
program by all feasible means, including advertisements in
various media and by using grass roots community networks.
3)Establishes CAP, administered by BAR, 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. The 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.
4)Provides, under the EFMP pursuant to guidelines adopted by ARB
in consultation with BAR, a program for the voluntary
retirement of passenger vehicles and light and medium duty
trucks that are high polluters, pursuant to AB 118 (Núñez),
Chapter 750, Statutes of 2007. Under the EFMP as administered
by BAR, vehicles do not have to fail smog inspection in order
to be eligible for EFMP benefits.
5)Requires EFMP to focus efforts where the greatest air quality
impact can be identified and to consider cost-effectiveness
and impacts on disadvantaged and low-income populations.
Under EFMP, 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). EFMP funding from motor
vehicle registration fees are scheduled to sunset on January
1, 2016.
6)Defines "low-income motor vehicle owner" as a person whose
income does not exceed 225% of the federal poverty level, as
published quarterly in the Federal Register by the United
States Department of Health and Human Services.
FISCAL EFFECT : According to the Assembly Appropriations
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Committee, minor and absorbable costs for ARB to update program
guidelines.
COMMENTS : According to the author, retiring older,
high-polluting vehicles is a cost effective way to reduce air
pollution since a small number of high-polluting cars produce
the vast majority of pollution. The author reports that many of
these older, high-polluting vehicles tend to have poor fuel
economy and that these cars, which are often owned by poor
working families, can keep owners trapped in a cycle of paying
high fuel costs and therefore unable to afford newer, cleaner
vehicle with better fuel economy. The author points out that if
a greater number of these high-polluting vehicles are retired
and replaced with cleaner cars, California would have cleaner
air and working families would have lower overall fuel costs.
The author notes that under EFMP, 90% of the approximately $30
million available for the program annually has been spent for
vehicle retirement but that very little of that money has been
spent to provide vouchers to help individuals purchase a 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.
To help accelerate the rate of retirement for high-polluting
vehicles, 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.
Writing is support of this bill, the San Joaquin Valley Air
Pollution Control District notes that this bill would have a
significant positive impact on efforts to clean the air in the
San Joaquin Valley because this region of the state, in
particular, has many low income motor vehicle owners who drive
high-emitting vehicles but cannot afford to replace them. The
San Joaquin Valley Air Pollution Control District notes that
many of these vehicle owners are often unaware of the
availability of vehicle replacement program assistance and that
helping to eliminate barriers for participation in the program
would help to get cleaner cars on the road and reduce mobile
source emissions.
Writing in opposition to this bill, the Association of
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California Car Clubs (ACCC) raises concerns that scrappage
programs such as CAP and EFMP cause valuable and rare car parts
to be lost rather than allowing these parts to be used for
vehicle restoration projects. ACCC contends that individuals
using the vehicle retirement program frequently scrap cars that
are infrequently used, ultimately doing little to improve air
quality.
This bill was recently amended to establish a minimum
replacement compensation for low-income vehicle owners and a
maximum compensation for all other vehicle owners. The
amendments also addressed limits to EFMP eligibility to ensure
that qualifying vehicles have sufficient remaining life to
better capture air quality benefits of removing high-polluting
vehicles from California's roadways.
Proposed amendments : The author is proposing additional
amendments that would establish that vehicle replacement may be
an option for all motor vehicle owners, that retirement programs
may be combined, that compensation for low-income vehicle owners
not be less than $2,500, and that compensation for all other
vehicle owners not exceed that provided to low-income vehicle
owners.
Related bills : SB 11 (Pavley) of 2013, extends fees for air
pollution reduction programs, including the EFMP established
under AB 118. SB 11 scheduled to be heard in the Assembly
Transportation Committee.
AB 8 (Perea) of 2013 extends, until January 1, 2024, extra
charges on vehicle registrations, boat registrations, and tire
sales in order to fund, among other programs, the AB 118,
program. This bill would also extend the authority of local air
districts to impose vehicle registration surcharges in their
area. AB 8 is pending on the Senate Floor.
Previous legislation : AB 787 (Hill), Chapter 231, Statutes of
2010, authorizes BAR to pay up to $1,500 to a low-income
individual and up to $1,000 to any other individual who retires
their vehicle under the CAP smog check program or EFMP as
authorized under AB 118.
SB 901 (Steinberg) of 2011, as introduced, would have
prioritized EFMP expenditures for the highest polluting vehicles
registered in areas that are out of attainment with federal air
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quality standards. Those provisions were deleted by subsequent
amendments to that bill.
REGISTERED SUPPORT / OPPOSITION :
Support
American Lung Association in California
Asian Pacific Environmental Network
Breathe California
California Council for Environmental and Economic Balance
Coalition for Clean Air
Consumer Action
Consumer Federation of California
Consumers for Auto Reliability and Safety
Greenlining Institute
Natural Resources Defense Council
San Joaquin Valley Air Pollution Control District
South Coast Air Quality Management District
Union of Concerned Scientists
ValleyCAN
Opposition
Association of California Car Clubs
Analysis Prepared by : Victoria Alvarez / TRANS. / (916) 319-
2093