Amended in Assembly June 16, 2014

Amended in Senate March 25, 2014

Senate Bill No. 913

Introduced by Senator DeSaulnier

(Coauthors: Senators Beall, Cannella, Galgiani, and Jackson)

(Coauthors: Assembly Members Bonilla and Daly)

January 23, 2014

An act to amend Section 44125 of the Health and Safety Code, relating to vehicular air pollution.

LEGISLATIVE COUNSEL’S DIGEST

SB 913, as amended, DeSaulnier. Vehicular air pollution: vehicle retirement.

Existing law creates an enhanced fleet modernization program for the retirement of high polluting vehicles to be administered by the Bureau of Automotive Repair in the Department of Consumer Affairs pursuant to guidelines adopted by the State Air Resources Board. Existing law requires the department to pay a person who retires his or her vehicle $1,500 for a low-income motor vehicle owner, as defined, and $1,000 for all other motor vehicle owners, and authorizes additional payments above these amounts based on consideration of specified criteria.

Under existing law, the Bureau of Automotive Repair establishes the Consumer Assistance Program to provide incentives for low-income motor vehicle owners to retire a qualified vehicle.

This bill would require the guidelines adopted by the state board to additionally include specific goals for retirement and replacement of passenger vehicles and light- and medium-duty trucks that are high polluters. The bill would require the state board and the bureau to cooperate in the issuance of a specified number of replacement vouchers through the Enhanced Fleet Modernization Program for specified fiscal years and a specified number of retirement vouchers through the Consumer Assistance Program and the Enhanced Fleet Modernization Program for specified fiscal years. The bill would state the intent of the Legislature regarding the funding of these activities. begin insert The bill would require the state board to study and consider specified elements. end insert The bill would require the state board and the bureau, on or before September 1, 2016, to make publicly available, on their respective Internet Web sites, a report regarding whether the goals for the numbers of vehicle retirements and replacements have been met and, if not, the manner in which the state board and the bureau plan to revise the program to increase the numbers of vehicle retirements and replacements.

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

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

SECTION 1.  

Section 44125 of the Health and Safety Code is
amended to read:

44125.  

(a) No later than July 1, 2009, the state board, in
consultation with the bureau, shall adopt a program to commence
on January 1, 2010, that allows for the voluntary retirement of
passenger vehicles and light-duty and medium-duty trucks that are
high polluters. The program shall be administered by the bureau
pursuant to guidelines adopted by the state board.

(b) No later than June 30, 2015, the state board, in consultation
with the bureau, shall update the program established pursuant to
subdivision (a). The program shall continue to be administered by
the bureau pursuant to guidelines updated and adopted by the state
board.

(c) The guidelines shall ensure all of the following:

(1) Vehicles retired pursuant to the program are permanently
removed from operation and retired at a dismantler under contract
with the bureau.

(2) Districts retain their authority to administer vehicle
retirement programs otherwise authorized under law.

(3) The program is available for high polluting passenger
vehicles and light-duty and medium-duty trucks that have been
continuously registered in California for two years prior to
acceptance into the program or otherwise proven to have been
driven primarily in California for the last two years and have not
been registered in another state or country in the last two years.
The guidelines may require a vehicle to take, complete, or pass a
smog check inspection.

(4) The program is focused where the greatest air quality impact
can be identified.

(5) (A) Compensation for retired vehicles shall be at least one
thousand five hundred dollars ($1,500) for a low-income motor
vehicle owner, as defined in Section 44062.1, and no more than
one thousand dollars ($1,000) for all other motor vehicle owners.

(B) Replacement may be an option for all motor vehicle owners
and may be in addition to compensation for vehicles retired
pursuant to subparagraph (A). For low-income motor vehicle
owners, as defined in Section 44062.1, compensation shall be no
less than two thousand five hundred dollars ($2,500).
Compensation for all other motor vehicle owners shall not exceed
compensation for low-income motor vehicle owners.

(C) Compensation for either retired or replacement vehicles for
low-income motor vehicle owners may be increased as necessary
to maximize the air quality benefits of the program while also
ensuring participation by low-income motor vehicle owners, as
defined in Section 44062.1. Increases in compensation amounts
may be based on factors, including, but not limited to, the age of
the retired or replaced vehicle, the emissions benefits of the retired
or replaced vehicle, the emissions impact of any replacement
vehicle, participation by low-income motor vehicle owners, as
defined in Section 44062.1, and the location of the vehicle in an
area of the state with the poorest air quality.

(6) Cost-effectiveness and impacts on disadvantaged and
low-income populations are considered. Program eligibility may
be limited on the basis of income to ensure the program adequately
serves persons of low or moderate income.

(7) Provisions that coordinate the vehicle retirement and
replacement components of the program with the vehicle retirement
component of the bureau’s Consumer Assistance Program,
established pursuant to other provisions of this chapter, to ensure
vehicle owners participate in the appropriate program to maximize
emissions reductions.

(8) Streamlined administration to simplify participation while
protecting the accountability of moneys spent.

(9) Specific steps to ensure the vehicle replacement component
of the program is available in areas designated as federal extreme
nonattainment.

(10) A requirement that vehicles eligible for retirement have
sufficient remaining life. Demonstration of sufficient remaining
life may include proof of current registration, passing a recent
smog check inspection, or passing another test similar to a smog
check inspection.

(d) (1) In addition to subdivision (c), the guidelines shall include
all of the following:

(A) Specific goals for retirement and replacement of passenger
vehicles and light-duty and medium-duty trucks that are high
polluters.

(B) A requirement that the state board and the bureau cooperate
in issuing the following:

(i) Not less than 15,000 retirement vouchers through the
Consumer Assistance Program for the 2014-15 fiscal year.

(ii) Not less than 20,000 retirement vouchers through the
Consumer Assistance Program for the 2015-16 fiscal year.

(iii) Not less than 25,000 retirement vouchers through the
Enhanced Fleet Modernization Program for the 2014-15 fiscal
year.

(iv) Not less than 28,000 retirement vouchers through the
Enhanced Fleet Modernization Program for the 2015-16 fiscal
year.

(C) A requirement that the state board issue, through the
Enhanced Fleet Modernization Program, not less than 1,000
replacement vouchers for the 2014-15 fiscal year and not less than
2,000 replacement vouchers for the 2015-16 fiscal year.

(2) (A) It is the intent of the Legislature that the activities
undertaken pursuant to paragraph (1) be funded by the Enhanced
Fleet Modernization Subaccount, the High Polluter Repair or
Removal Account, and the Vehicle Inspection and Repair Fund.

(B) It is the intent of the Legislature that if moneys in the
subaccount, account, and fund specified in subparagraph (A) are
not sufficient to fully fund the activities undertaken pursuant to
paragraph (1), any and all outstanding loans to the General Fund
from the subaccount, account, and fund be repaid to fund those
activities.

(e) When updating the guidelines to the program established
pursuant to subdivision (a), the state board shall study and consider
all the following elements:

(1) Methods of financial assistance other than vouchers.

(2)  begin insert (A) end insert begin insert   end insert An option for automobile dealerships or other used car
sellers to accept cars for retirement, provided the cars are
dismantled consistent with the requirements of the program.

begin insert

(B) In studying and developing the option pursuant to this
paragraph, the state board shall also consider consumer protection
measures for the purchase and financing of any replacement
vehicle to ensure that benefits of the incentive accrue to consumers,
including, but not limited to, the following measures:

end insert begin insert

(i) Requiring, encouraging, or educating consumers to borrow
from reputable lending institutions or join credit unions to establish
credit prior to purchase.

end insert begin insert

(ii) Prohibiting vehicle loans by the selling dealership.

end insert begin insert

(iii) Leveraging financial counseling offered by credit unions
by directing consumers to those resources.

end insert begin insert

(iv) Suggesting or requiring consumers to be preapproved for
financing before visiting a dealer or other used car seller.

end insert begin insert

(v) Implementation of consumer protection measures in
collaboration with consumer advocacy groups that provide
financial counseling.

end insert begin insert

(vi) Directing consumers to California’s low-cost auto insurance
program.

end insert begin insert

(vii) Requiring an estimate for total cost of car ownership with
a truth-in-lending statement.

end insert begin insert

(viii) Establishing preapproved pricing for used vehicles.

end insert begin insert

(ix) Requiring vehicle inspection and disclosure by an
independent automobile mechanic.

end insert begin insert

(x) Requiring the vehicle history to be provided and attached
to the purchase paperwork.

end insert begin insert

(xi) Requiring a vehicle warranty for a specified timeframe.

end insert

(3) An incentive structure with varied incentive amounts to
maximize program participation and cost-effective emissions
reductions.

(4) Increased emphasis on the replacement of high polluters
with cleaner vehicles or the increased use of public transit that
results in the increased utilization of the vehicle replacement
component of the program.

(5) Increased emphasis on the reduction of greenhouse gas
emissions through increased vehicle efficiency or transit use as a
result of the program.

(6) Increased partnerships and outreach with community-based
organizations.

begin insert

(7) Including private party sales in the program.

end insert begin insert

(8) Providing a combined retirement and replacement incentive.

end insert begin insert

(9) Requiring a minimum efficiency standard for a replacement
vehicle of 27 miles per gallon for passenger vehicles and 23 miles
per gallon for light- and medium-duty trucks.

end insert

(f) On or before September 1, 2016, the state board and the
bureau shall make publicly available, on their respective Internet
Web sites, a report regarding whether the goals for the numbers
of vehicle retirements or replacements specified in paragraph (1)
of subdivision (d) were met and, if not, the manner in which the
state board and the bureau plan to revise the Consumer Assistance
Program and the Enhanced Fleet Modernization Program to
increase the number of vehicle retirements and replacements.