BILL ANALYSIS Ó
SENATE COMMITTEE ON APPROPRIATIONS
Senator Ricardo Lara, Chair
2015 - 2016 Regular Session
AB 1691 (Gipson) - Vehicular air pollution: vehicle retirement
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|Version: August 3, 2016 |Policy Vote: T. & H. 7 - 0, |
| | E.Q. 5 - 0 |
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|Urgency: No |Mandate: No |
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|Hearing Date: August 8, 2016 |Consultant: Mark McKenzie |
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This bill meets the criteria for referral to the Suspense File.
Bill
Summary: AB 1691 would require the California Air Resources
Board (CARB) to develop guidelines for the Plus-Up Pilot Project
and update guidelines for the Enhanced Fleet Modernization
Program (EFMP) by January 1, 2018 in order to reduce application
backlogs and waiting lists, target resources for the
lowest-income disadvantaged communities, and prioritize older,
higher-polluting vehicles for incentives, as specified.
Fiscal
Impact:
One-time CARB costs of up to $163,000 (Enhanced Fleet
Modernization Subaccount) to update EFMP guidelines and
establish Plus-Up Pilot Project guidelines, as specified, by
January 1, 2018.
Unknown cost pressures on the Greenhouse Gas Reduction Fund
AB 1691 (Gipson) Page 1 of
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(GGRF), potentially in the millions annually through 2021-22,
as a result of codified intent language that the number of
vehicles replaced under the Plus-Up Pilot Project is increased
annually.
Background: The Consumer Assistance Program (CAP) was created to encourage
voluntary accelerated vehicle retirement ("car scrap") which
provides 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.
Existing state law establishes the EFMP, administered by CARB
and the Bureau of Automotive Repair. EFMP provides for the
voluntary retirement of passenger vehicles and light- and
medium-duty trucks that are high polluters. Unlike CAP, EFMP
allows vehicles to be retired without first having to fail a
smog test, and offers a $1,000 voucher ($1,500 for low-income
owners) to retire a high-polluting vehicle.
EFMP includes a vehicle replacement component, referred to as
EFMP Plus-Up, which is operated by the San Joaquin and South
Coast air districts, both of which are designated as extreme
non-attainment areas for ozone, in partnership with CARB. Under
EFMP Plus-Up, a low-income owner who lives in one of these
districts can get a $2,500 "replacement" voucher in addition to
the $1,500 base EFMP "retirement" voucher. The owner may use
the funds to either purchase a car that is less than eight years
old, or to obtain a public transit voucher. If a low-income
owner lives within a disadvantaged community in one of these air
districts, and wants to purchase a hybrid, plug-in hybrid, or
battery electric vehicle, he or she can "stack" additional
incentives on top of these two vouchers. 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. Depending on income and the type of
replacement vehicle, the owner can get incentives worth up to
$12,000 total toward the purchase of a new car.
EFMP is funded through vehicle surcharges, whereas EFMP Plus-Up
has been funded through GGRF moneys. For 2015-16, funding for
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EFMP and EFMP Plus-Up is around $12.8 million which ARB
estimates will provide incentives for about 1,500 vehicles. In
the 2016-17 fiscal year, proposed funding for both programs
totals $37.4 million ($30 million of which is GGRF), and would
provide incentives for about 4,500 vehicles. EFMP Plus-Up Pilot
Program was funded in 2015-16 with $20 million from GGRF. The
2016-17 investment plan for CARB's low carbon transportation
investments proposes $30 million from GGRF.
Proposed Law:
AB 1691 would require CARB to develop guidelines for the
Plus-Up Pilot Project and update guidelines for the EFMP by
January 1, 2018 to ensure all of the following:
That each air district participating in either program that
has a backlog or waiting list for applicant develop a plan
with recommendations to CARB on how to eliminate the backlog
or waiting list.
That specific steps are taken to ensure the respective
programs are not being misused, including random income
eligibility verification and contact with program participants
at least once after a vehicle is replaced.
Inclusion of mandatory partnerships with, and a minimum amount
of funding allocated to outreach for, community-based
organizations to ensure accessibility for the lowest-income
disadvantaged communities. Districts must submit an outreach
and partnership report to CARB every six months after July 1,
2018.
The programs have enhanced prescreening of applicants, if it
is determined by CARB to be appropriate.
Priority is given to retirement or replacement of vehicles
that are 15 years or older with more than 75,000 miles. With
respect to the EFMP, this requirement only applies to the
portion of the program focused on disadvantaged communities.
The bill authorizes participating air districts to submit the
specified outreach and partnership report in combination with
another report that must be submitted to CARB at least annually.
SB 1691 also states legislative intent that the efforts of the
Plus-Up Pilot Project are focused on disadvantaged communities
and that the number of vehicles replaced is increased annually.
The bill's provisions would sunset on July 1, 2022.
AB 1691 (Gipson) Page 3 of
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Related
Legislation: AB 1965 (Cooper) would require CARB to update its
EFMP guidelines to expand the EFMP Plus-Up program in
disadvantaged communities and in areas with poor air quality, as
specified. That bill failed passage in the Senate Environmental
Quality Committee this year.
Staff
Comments: EFMP Plus-Up has been particularly successful in the
San Joaquin Valley, resulting in the retirement of 292
high-polluting vehicles in the first six months of the program.
The San Joaquin Valley program uses "grass roots" advertising
and outreach to invite low- and moderate-income vehicle owners
to participate in events where they can get a free smog test and
undergo pre-screening to determine whether they are eligible for
various incentives. The South Coast program uses more
traditional outreach tools such as flyers, billboards, and
websites. While the South Coast program is also successful,
with a long wait list, it does not currently offer pre-screening
services that would enable staff to prioritize applications for
the oldest, highest polluting cars. This bill would require
CARB to enact updated guidelines to standardize the programs in
participating air districts to ensure consistency in the
administration of the EFMP and Plus-Up programs.
Staff notes that current law does not explicitly mention the
Plus-Up program in statute. This bill would codify the program
by requiring CARB to develop guidelines for the program, and
place the requirements within the provisions of the Health and
Safety Code pertaining to the Air Quality Improvement Program, a
program administered by CARB to fund air quality improvement
projects relating to fuel and vehicle technologies. It is
unclear why the Plus-Up provisions of this bill are placed
within the AQIP statutes.
Recommended
Amendments: Staff recommends that the bill be amended to remove
GGRF cost pressures by deleting legislative intent that the
number of vehicles replaced under the Plus-Up Pilot Project is
AB 1691 (Gipson) Page 4 of
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increased annually. (page 3, lines 31-32 of the bill)
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