BILL ANALYSIS Ó
SENATE TRANSPORTATION & HOUSING COMMITTEE BILL NO: Sb 913
SENATOR MARK DESAULNIER, CHAIRMAN AUTHOR: DeSaulnier
VERSION: 3/25/14
Analysis by: Erin Riches FISCAL: yes
Hearing date: April 1, 2014
SUBJECT:
Vehicle emissions reductions: Enhanced Fleet Modernization
Program (EFMP) and Consumer Assistance Program
DESCRIPTION:
This bill requires the state Air Resources Board (ARB) and the
Bureau of Automotive Repair (BAR) to cooperate in issuing a
specified number of vouchers through EFMP and the Consumer
Assistance Program to retire high-polluting cars and a specified
number of vouchers through EFMP to replace high-polluting cars.
ANALYSIS:
Smog Check Program
Existing law establishes the Motor Vehicle Inspection Program,
commonly known as the smog check program. The Department of
Consumer Affairs administers this program through BAR. The smog
check program generally requires vehicle owners to have their
vehicles tested every two years, with some exceptions, including
gas-powered vehicles manufactured prior to 1976, alternatively
fueled vehicles, and vehicles six model years old or newer.
Consumer Assistance Program
If a vehicle fails a smog check, the owner must, in most cases,
repair the vehicle and pass a subsequent smog check in order to
register a vehicle or renew its registration. A vehicle owner
whose vehicle fails a smog test can obtain financial assistance
through the Consumer Assistance Program, administered by BAR.
The Consumer Assistance Program provides three options:
Repair cost waiver . A repair cost waiver allows a vehicle
owner to register the vehicle for two years even if it fails
the smog test. In order to qualify for the waiver, the owner
must spend at least $450 on repairs. Low-income vehicle
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owners (defined as those with household income at or below 185
percent of the federal poverty level) qualify if the repair
estimate exceeds $250.
Repair cost assistance . Vehicle owners who are current on
their vehicle registration fees and whose vehicle has failed a
smog test qualify for $500 toward emission-related repairs.
In addition, the owner's household income must be at or below
225 percent of the federal poverty level and the owner cannot
have previously received assistance under this program for the
same vehicle.
Vehicle retirement . If a vehicle has failed a smog test, the
owner may apply for up to $1,500 (household income at or below
225 percent of the federal poverty level) or $1,000 (all other
individuals) in exchange for scrapping the car. To qualify
for retirement, a vehicle must be currently registered as
operable, with registration fees paid, must have failed its
most recent smog test, and:
o have been continuously registered for two
years prior to application; or
o have been registered as non-operational for a maximum of
60 days during the prior two years, occurring at least 90
days prior to application; or
o have had lapsed registration for less than 121 days
during prior two years, provided the vehicle is registered
for at least 90 days prior to application.
Under this program, the owner takes the BAR approval letter to
a BAR-approved vehicle dismantler, who destroys the vehicle
and issues the owner a check. The Consumer Assistance Program
retired 12,000 vehicles in 2012-13.
Enhanced Fleet Modernization Program (EFMP)
EFMP provides for the voluntary retirement of passenger vehicles
and light- and medium-duty trucks that are high polluters. A
vehicle need not have failed a smog test to qualify for EFMP,
but it must meet ARB's definition of high-polluting. The
vehicle must be currently registered as operable and must have
been continuously registered for two years prior to the
application, unless the owner can provide specified information
to show the vehicle has been operated in the state during that
period. EFMP has a statewide component and a local component.
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Under the statewide component, ARB administers a program, in
consultation with BAR, to retire high-polluting vehicles. Under
this program, EFMP offers a $1,500 voucher to low-income vehicle
owners (household income at or below 225 percent of federal
poverty level), or a $1,000 voucher to all other vehicle owners,
to retire a high-polluting vehicle. EFMP retired approximately
25,000 high-polluting vehicles in 2012-13.
Under the local component, ARB administers a program, authorized
in the San Joaquin Valley Air Pollution Control District and the
South Coast Air Quality Management District, to replace
high-polluting vehicles. In addition to the retirement vouchers
described above, the local EFMP program offers:
A $2,500 voucher to low-income vehicle owners (household
income at or below 225 percent of federal poverty level) to
replace a high-polluting vehicle, by either purchasing a
vehicle eight years old or newer, or using the voucher toward
public transit.
A $2,000 voucher to all other vehicle owners to replace a
high-polluting vehicle by either purchasing a vehicle four
years old or newer, or using the voucher toward public
transit.
EFMP has issued less than two dozen replacement vouchers since
the program's inception in 2010, all in the South Coast Air
Quality Management District.
This bill requires ARB to include in EFMP guidelines specific
goals for retirement and replacement of passenger vehicles and
light- and medium-duty trucks that are high polluters.
This bill also requires ARB and BAR to cooperate in the issuance
of a specified number of replacement vouchers through EFMP, and
a specified number of retirement vouchers through EFMP and the
Consumer Assistance Program.
Specifically, this bill requires ARB to adopt guidelines that
include the following targets:
Issue at least 15,000 retirement vouchers under the Consumer
Assistance Program in
2014-15 and at least 20,000 in 2015-16.
Issue at least 25,000 retirement vouchers under EFMP in
2014-15 and at least 28,000 in 2015-16.
Issue at least 1,000 replacement vouchers under EFMP in
2014-15, and at least 2,000 in 2015-16.
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This bill also requires ARB and BAR to make publicly available
on their respective websites, by September 1, 2016, a report as
to whether these targets were met and, if not, how ARB and BAR
plan to revise the programs to increase vehicle retirements and
replacements.
COMMENTS:
1.Purpose . The author notes that just 25 percent of cars on the
road are responsible for 75 percent of smog-forming emissions
from motor vehicles. According to ARB, a typical 20-year-old
vehicle emits 30 times more smog-forming pollutants per mile
than a 5-year-old vehicle. Retiring these older,
high-polluting vehicles is a key part of meeting the state's
emissions reduction goals. At the same time, it is essential
to ensure that vehicle owners can afford a replacement vehicle
that is cleaner, safer, and more reliable. While the
governor's goal to get 1.5 million zero-emission vehicles
(ZEVs) on California's roads by 2025 is laudable, most
low-income households are priced out of the ZEV market. A
February 2014 Next Generation report finds that for low-income
Californians, particularly in rural areas, "getting into a
relatively more efficient vehicle is more realistic than
getting into a new electric vehicle, which is expensive, or
onto public transit, which is often ineffective in serving
rural households." This bill aims to help more owners replace
their high-polluting vehicles by setting hard targets for
vehicle retirement and replacement under the Consumer
Assistance Program and EFMP.
2.EFMP regulations are a work in progress . SB 459 (Pavley) of
2013 (see "Previous legislation" below) requires ARB, in
consultation with BAR, to update EFMP regulations by June 30,
2015. This legislation requires the guidelines to include a
variety of new policies, including allowing for retirement and
replacement vouchers of larger amounts, focusing the program
more heavily on lower income owners, and streamlining program
requirements to facilitate participation. SB 459 also
requires BAR to expand Consumer Assistance Program eligibility
to allow a vehicle that has failed a smog check and has been
registered for at least two years in California without
substantial lapse (currently, a vehicle that has not been
registered continuously for two years must not have had a
lapse of more than 120 days and must be registered for at
least 90 days prior to the application). BAR and ARB are
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both in the process of soliciting stakeholder input as they
draft the revised regulations. In March, ARB issued a white
paper describing the proposed revisions; ARB will vote on the
final revised regulations in June. The white paper does not
propose to include targets for vehicle retirement and
replacement.
3.How are these programs doing ? As noted above, EFMP retired
approximately 25,000 high-polluting vehicles in 2012-13, of
which about 60 percent belonged to low-income individuals.
The Consumer Assistance Program retired approximately 12,000
vehicles in 2012-13, of which nearly 9,000 belonged to
low-income individuals. EFMP has issued only 21 replacement
vouchers since the program's inception in 2010.
RELATED LEGISLATION:
This committee will hear two related bills at today's hearing:
SB 1204 (Lara) creates a Clean Truck, Bus, and Off-Road
Vehicle and Equipment Technology Program to fund
development, demonstration, pilot projects, and commercial
deployment of zero- and near-zero-emission trucks, buses,
and off-road vehicles and equipment technologies. SB 1204
provides that the program shall be funded from the
Greenhouse Gas Reduction Fund, and shall prioritize
projects located in disadvantaged communities.
SB 1275 (De Leon) requires ARB to expand EFMP to provide
for ridesharing and car-sharing vouchers as an alternative
to vehicle-replacement vouchers. It also requires ARB to
adopt a funding plan for projects under the Air Quality
Improvement Program (AQIP), adopt specified revisions to
AQIP, and establish programs to increase access to and
direct benefits for disadvantaged and low- and
moderate-income communities from electric transportation.
PREVIOUS LEGISLATION:
SB 359 (Corbett), Chapter 415, Statutes of 2013,
provides $48 million in additional funding in the current
fiscal year to ARB to support EFMP and several other
programs.
SB 459 (Pavley), Chapter 437, Statutes of 2013, requires
ARB, in consultation with BAR, to update the EFMP
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guidelines as specified by June 30, 2015.
AB 8 (Perea), Chapter 401, Statutes of 2013, extends
until January 1, 2024, a $1 extra fee on vehicle
registrations to fund EFMP.
AB 787 (Hill), Chapter 231, Statutes of 2010, authorized
BAR to pay up to $1,500 to a low-income individual and up
to $1,000 to any other individual who retires his or her
vehicle under the smog check program or EFMP.
AB 823 (Hill) of 2009, which Governor Schwarzenegger
vetoed, would have limited eligibility for financial
assistance under the Consumer Assistance Program to
low-income individuals, defined as a vehicle owner whose
income does not exceed 225 percent of the federal poverty
level.
POSITIONS: (Communicated to the committee before noon on
Wednesday, March 26,
2014.)
SUPPORT: Breathe California
California New Car Dealers Association
OPPOSED: None received.