BILL ANALYSIS Ó
AB 1691
Page 1
Date of Hearing: April 18, 2016
ASSEMBLY COMMITTEE ON TRANSPORTATION
Jim Frazier, Chair
AB 1691
(Gipson) - As Amended April 12, 2016
SUBJECT: Vehicular air pollution: vehicle retirement
SUMMARY: Requires the California Air Resources Board (ARB) to
evaluate the Enhanced Fleet Modernization Program (EFMP)
guidelines to ensure that the program is not misused and that
priority is given to replacement of the oldest, high-mileage
vehicles. Specifically, this bill:
1)Declares the intent of the Legislature that the Plus Up Pilot
program be focused on disadvantaged communities and increase
the number of vehicles that are replaced annually.
2)Requires ARB, no later than June 30, 2017, to update the Plus
Up Pilot guidelines to ensure the following:
a) That each local air district implementing a vehicle
retirement program funded by ARB's Plus Up Pilot Project
with a backlog or a waiting list for applicants is required
to develop a plan on how to eliminate the backlog or
waiting list;
b) That specific steps are taken to ensure the program is
AB 1691
Page 2
not being misused, including, but not limited to, random
income eligibility verification and contact with program
participants at least once after their vehicles are
replaced;
c) That evaluation of whether prescreening of applicants
for the program can be enhanced; and,
d) For the portion of the program focused on disadvantaged
communities, that priority is given to the retirement of
vehicles that are 15 years old or older and vehicles with
more than 75,000 miles
EXISTING LAW:
1)AB 32 (Núñez), Chapter 488, Statutes of 2006, requires ARB to
reduce greenhouse gas (GHG) emissions to the 1990 level by
2020 and authorized ARB to use market-based mechanisms (cap
and trade) to achieve compliance with these regulations.
2)Created the Consumer Assistance Program (CAP) to encourage
voluntary accelerated vehicle retirement ("car scrap") which
provides a monetary incentives to vehicle owners to retire
older, high polluting vehicles. Under this program owners who
scrap their vehicles are given $1,000 ($1,500 for low income
consumers) for vehicles that have failed their last smog test.
3)Established the EFMP pursuant to AB 118 (Núñez), Chapter 750,
Statutes of 2007, to be funded by a $1 surcharge on motor
vehicle registration, to encourage the retirement of high
polluting passenger vehicles and light- and medium-duty trucks
in areas with the greatest air quality impacts. The program
offers $1,000 ($1,500 for low-income consumers) to retire
specified high-polluting vehicles.
AB 1691
Page 3
4)Established the EFMP-Plus-Up as a pilot project in the Greater
Los Angeles area and San Joaquin Valley to help low-income
individuals and families retire high-polluting vehicles and
purchase cleaner cars. The program provides increasingly
larger cash payments for the lowest-income families to move
into the cleaner cars.
5)Established the Charge Ahead California Initiative
(Initiative), pursuant to SB 1275
(de León), Chapter 530, Statutes of 2014, to provide incentives
that increase the availability of zero-emission vehicles (ZEV)
and near-zero-emission vehicles (NZEV) vehicles, particularly
in disadvantaged and low-and-moderate-income communities.
FISCAL EFFECT: Unknown
COMMENTS: Approximately 40% of emissions generated in
California can be attributed to the transportation sector.
Older vehicles are known to be some of the highest polluting
vehicles, because they lack the modern emission-reducing
technologies that are currently available. ARB estimates that
California has five times more cars that are over 20-years old
compared to the national average.
To help improve air quality and help meet the state's emissions
reduction goals and improve air quality, a number of programs
have been developed to encourage vehicle owners to scrap their
older, high-polluting cars and trucks and replace them with
AB 1691
Page 4
newer, cleaner vehicles. While many of these programs are
offered to all consumers, some programs are specifically target
toward disadvantaged communities and lower-income residents who
tend to own and operate some of the oldest, high-polluting cars
on our roads primarily because they are more affordable to
purchase, but not necessarily inexpensive to fuel and operate.
CAP, administered by the Bureau of Automotive Repair offers
low-income drivers money to complete repairs needed to pass a
smog test. The EFMP, administered by ARB, augments CAP by
allowing vehicles to be retired, without first having to fail a
smog test, by authorizing vouchers to replace older,
high-emitting vehicles with cleaner cars. The program offers
consumers $1,000 to retire an older, high polluting vehicle
($1,500 for low-income consumers).
In addition, ARB also administers EFMP Plus-Up in two air
districts in California that are classified as extreme
non-attainment (San Joaquin Valley and South Coast). EFMP
Plus-Up, with funding from the Greenhouse Gas Reduction Fund (or
cap-and-trade revenues), provides additional down payment
incentives (on top of the "base" EFMP incentives) to further
encourage individuals to retire and replace their older,
less-efficient vehicles with advanced-technology cars.
By "stacking" incentive payments, low-income consumers can
receive between $4,000 and $9,500 toward the purchase of a
replacement vehicle, depending on the make and model of the
replacement vehicle. While the program allows individuals to
trade in their high-polluting cars for cleaner gas-powered cars,
greater incentives are provided if the individual opts to
purchase a hybrid, hybrid-electric, or fully electric vehicle.
AB 1691
Page 5
The EFMP Plus-Up has been extremely successful and has resulted
in the retirement of 292 high emitting vehicles in the first six
months of the program in the San Joaquin Valley alone. The
model used for EFMP Plus-Up pilot program in the San Joaquin
Valley differs slightly for the pilot program established in the
South Coast Air District. For example, in the San Joaquin
Valley, the program uses "grass roots" advertising to encourage
low- and moderate-income individuals and households to
participate. The programs are offered at "events" where
participants are offered free smog testing and information about
what programs are available and participants are screened to
determine their program qualification status. Following the
screening participants are encouraged to take part in various
programs for which they qualify. At the events, which are
offered monthly, substantial numbers of individuals are offered
vouchers for smog repairs and other interested qualifying
individuals are guided through the car scrap and vehicle
replacement programs by program staff. Using the pre-screening
process, staff are able to identify participants qualifying
participants with the greatest need and who own and operate the
oldest, highest polluting vehicles.
This style of outreach is contrasted with the EFMP Plus-Up
program piloted in the South Coast Air District whereby
individuals are encouraged to participate using more traditional
outreach methods like posters, flyers, billboards, and websites.
While this style of outreach has been successful, resulting in
long waiting lists of participants, it does not necessarily
provide the pre-screening that would allow staff to prioritize
applications so that older, dirtier cars are addressed first.
AB 1691
Page 6
The author has introduced AB 1691 to help encourage the most
efficient use of EFMP funds within the Plus-Up program, to
encourage the replacement of the oldest and dirtiest cars from
California roadways, and to help the lowest-income individuals
and households access the EFMP programs. To accomplish this,
this bill would require ARB to update EFMP guidelines by June
30, 2017, to ensure that districts implementing the program have
strategies in place to eliminate backlogs and waiting lists.
Additionally, this bill would also call upon ARB to ensure the
programs are not misused by requiring income eligibility
verification and follow up with participants. AB 1691 also
calls upon ARB to continuously evaluate the program to determine
where program enhancements might be made.
The requirement that ARB continuously work to enhance and update
the program will undoubtedly increase program success by
encouraging the use of new and innovative methodologies to
better reach and assist low income program participants and
further encourage the retirement and replacement of the oldest
and dirtiest cars. With these measures in place, this bill
will result in air quality improvements in some of California's
most highly polluted areas.
Committee suggested amendments: This bill, in its current form,
identifies the EFMP Plus-Up pilot program rather than EFMP, upon
which the Plus-Up pilot is based. The author may wish to amend
the bill to reference to the EFMP program as well as to include
provisions that require ARB to evaluate community partnerships
and outreach to ensure the programs are accessed by the lowest
AB 1691
Page 7
income disadvantaged communities in the state and that an
outreach and partnership report be submitted to the state board
every six months after July 1, 2017. The author may also wish
to include sunset provisions (of July 1, 2022) since by that
date it is likely that the program will be running smoothly and
to avoid the imposition of unnecessary long-term reporting
requirements.
Related legislation: AB 1965 (Cooper), requires ARB to expand
the EFMP Plus-Up in disadvantaged communities and in areas with
poor air quality to increase the retirement and replacement of
high-polluting vehicles. AB 1965 passed out of this committee
on April 11, 2016, with a vote of 12-3, and is awaiting a
hearing in the Assembly Appropriations Committee.
Previous legislation: AB 1275 (de León), Chapter 530, Statutes
of 2014, created the Charge Ahead California Initiative with the
goal of placing at least 1 million ZEV and NZEVs into service by
January 1, 2023, and increasing access to these vehicles by
disadvantaged, low-income, and moderate-income communities and
consumers.
SB 459 (Pavley), Chapter 437, Statutes of 2013, required ARB to
update the EFMP guidelines by June 30, 2015, in accordance with
specified goals and considerations. SB 459 included provisions
that restricted program eligibility and adjusted vehicle
retirement and replacement compensation amounts to ensure the
AB 1691
Page 8
program achieved greater emission reductions while also serving
low-income drivers. Additionally, SB 459 permitted the vehicle
retirement component of CAP to accept vehicles that have lapsed
in registration.
AB 118 (Núñez), Chapter 750, Statutes of 2007, created the
California Alternative and Renewable Fuel, Vehicle Technology,
Clean Air, and Carbon Reduction Act of 2007 that required the
California Energy Commission to implement certain programs and
provide funding to develop and deploy technologies and
alternative and renewable fuels in the marketplace to help
attain the state's climate change policies.
AB 32 (Núñez), Chapter 488, Statutes of 2006, required ARB to
develop and implement regulations necessary to reduce emissions
to 1990 levels by the year 2020.
REGISTERED SUPPORT / OPPOSITION:
Support
None on file
AB 1691
Page 9
Opposition
None on file
Analysis Prepared by:Victoria Alvarez / TRANS. / (916) 319-2093