BILL ANALYSIS Ó
SENATE COMMITTEE ON TRANSPORTATION AND HOUSING
Senator Jim Beall, Chair
2015 - 2016 Regular
Bill No: AB 1965 Hearing Date: 6/21/2016
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|Author: |Cooper |
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|Version: |5/31/2016 |
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|Urgency: |No |Fiscal: |Yes |
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|Consultant|Erin Riches |
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SUBJECT: Enhanced Fleet Modernization Program
DIGEST: This bill requires the state Air Resources Board (ARB)
to expand the Enhanced Fleet Modernization Program (EFMP),
relative to EFMP Plus-Up, in disadvantaged communities (DACs)
and in areas with poor air quality.
ANALYSIS:
1)Existing federal law, the Clean Air Act, requires the U.S.
Environmental Protection Agency to establish National Ambient
Air Quality Standards for certain air pollutants due to their
negative impact on public health above specified
concentrations. Regions that do not meet the national
standards for any one of the standards are designated as
non-attainment areas.
2)Existing state law establishes the smog check program,
administered by the Bureau of Automotive Repair (BAR). This
program generally requires vehicles registered in
non-attainment areas to undergo emission inspections.
Specifically, vehicle owners must have their vehicles tested
every two years, with some exceptions, including gas-powered
vehicles manufactured prior to 1976, alternatively-fueled
vehicles, and vehicles six years old or newer.
3)Existing state law also establishes the Consumer Assistance
Program (CAP) under BAR. CAP provides assistance to
low-income owners of vehicles that have failed a smog test in
AB 1965 (Cooper) Page 2 of ?
the form of a repair cost waiver, repair cost assistance, or a
monetary incentive of up to $1,500 to "retire" (scrap) the
vehicle.
4)Existing state law establishes the Enhanced Fleet
Modernization Program (EFMP), administered by the state ARB
and BAR. EFMP provides for the voluntary retirement of
passenger vehicles and light- and medium-duty trucks that are
high polluters. BAR determines whether an owner-applicant is
eligible for CAP or EFMP (or neither). EFMP offers a $1,000
voucher ($1,500 for low-income owners) to retire a
high-polluting vehicle.
EFMP includes a vehicle replacement component, now known as
EFMP Plus-Up, which is operated by the San Joaquin and South
Coast air districts in partnership with ARB. (These air
districts are the only ones in the state classified as extreme
non-attainment.) 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 DAC 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.
Depending on the owner's income and the type of replacement
vehicle, the owner can get up to $12,000 total toward the
purchase of a new car.
This bill requires ARB to expand EFMP, relative to EFMP Plus-Up,
as follows:
1)Requires ARB, in consultation with BAR, to set specific,
measurable goals for the retirement and replacement of
passenger vehicles and light-duty and medium-duty trucks that
are high polluters, for fiscal year 2016-17 and every fiscal
year thereafter,
2)Requires ARB, in consultation with BAR, to meet these goals by
updating the program guidelines by July 1, 2017, to:
a) Require specific steps be taken to ensure that the
vehicle replacement component of the program is available
in areas at risk of being designated as federal extreme
AB 1965 (Cooper) Page 3 of ?
non-attainment.
b) Require specific steps to be taken to ensure that the
vehicle replacement component of the program is available
in all districts containing DACs.
c) Require program funding for targeted outreach in
low-income communities and DACs to be increased from the
amounts allocated in fiscal year 2015-16.
d) Require improved coordination, integration, and
partnerships with other programs that target DACs and
receive GGRF monies.
3)Requires ARB, by July 1, 2018, and every other year
thereafter, to collect and post on its website the following
information:
a) Program performance relative to the goals it adopted
pursuant to this bill.
b) An accounting that includes, but need not be limited to,
funding allocated to the program, funding sources, and
program expenditures by region.
c) A comment on the overall success of the program, or lack
thereof, including but not limited to recommendations to
improve the overall performance of the program if ARB
determines it needs improvement.
4)Authorizes ARB, upon appropriation by the Legislature, to
allocate monies to expand the vehicle replacement component of
the program from the Enhanced Fleet Modernization Subaccount,
the High Polluter Repair or Removal Account, or the Vehicle
Inspection and Repair Fund.
COMMENTS:
1)Purpose. The author states that according to ARB, at least 2
million cars in the state, or 9% of the state's light-and
medium-duty vehicles, are more than 20 years old. This is
five times the national average. In 2011, the 9% of the fleet
that was model year 1992 or older produced 40% of total
smog-forming emissions from passenger vehicles. According to
state and local agency estimates, 10% to 15% of the state's
motor vehicles, known as gross polluters, are responsible for
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more than half of light-duty vehicle smog in the state.
Expanding EFMP Plus-Up to other regions will help get more
people into newer, cleaner, safer, and more reliable cars.
2)Need for the program. According to ARB, 75% of vehicular air
pollution is caused by just 25% of the fleet. While much
attention has been focused on the zero-emissions vehicle (ZEV)
mandate, which aims to have ZEVs comprise 15% of new cars sold
in California by 2025, programs such as EFMP and EFMP Plus-Up
are key to getting older, high-polluting cars off the road and
thereby achieving significant emissions reductions. Because
gross-polluting cars are often owned by lower-income
individuals, providing financial assistance can be an
essential element to helping them scrap these cars and replace
them with newer, cleaner cars.
3)How does EFMP Plus-Up work? 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. In addition, all of the families
served in the first six months were in DACs. 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 necessarily provide the
pre-screening that would enable staff to prioritize
applications for the oldest, highest-polluting cars.
4)How much does it cost? According to the Assembly
Appropriations Committee analysis, funding for EFMP and EFMP
Plus-Up totals $12.8 million in 2015-16, which ARB estimates
will provide incentives for about 1,500 vehicles. For
2016-17, proposed funding for both programs totals $37.4
million (of which $30 million is Greenhouse Gas Reduction
Fund), and would provide incentives for about 4,500 vehicles.
EFMP Plus-Up covers two air districts encompassing about 55%
of the state's population. Assuming the program expansion
required in this bill would increase the eligible population
by 50%, additional costs would be about $19 million.
5)Time to expand the success story? Currently, EFMP Plus-Up
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only serves two regions, the South Coast and San Joaquin air
districts. The author states that other regions - in
particular, the Bay Area and Sacramento air districts - have
expressed interest in utilizing EFMP Plus-Up to assist their
disadvantaged populations and to target the dirtiest segment
of the vehicle fleet. This bill aims to help expand the
program to other regions with poor air quality and to improve
coordination, integration, and partnerships with other
programs that target DACs, such as weatherization and
energy-efficiency initiatives.
6)South Coast concerns. The South Coast air district has taken
a "support with amendments" position on this bill. South
Coast states that it does not anticipate having a wait list
beyond fiscal year 2016-17, but also states that clearing the
backlog is partly dependent on state funding levels for EFMP
and EFMP Plus-Up. South Coast asks for amendments to allocate
funding in equal levels to EFMP and EFMP Plus-Up.
7)Double-referral. This bill has also been referred to the
Environmental Quality Committee.
Related Legislation:
AB 1691 (Gipson) - requires ARB to update EFMP, relative to EFMP
Plus-Up, to help increase efficiencies and reduce program abuse.
This bill will also be heard in this committee today.
SB 1275 (De Leon, Chapter 530, Statutes of 2014) - established
the Charge Ahead Initiative, to provide incentives to increase
the availability of ZEVs and near-ZEVs, particularly in DACs.
SB 459 (Pavley, Chapter 437, Statutes of 2013) - required ARB to
update the EFMP guidelines by June 30, 2015, to, among other
things, focus program assistance on lower-income vehicle owners.
Assembly Votes:
Floor: 55-23
Appr: 15-3
Trans: 12-3
FISCAL EFFECT: Appropriation: No Fiscal Com.: Yes
Local: No
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POSITIONS: (Communicated to the committee before noon on
Wednesday,
June 15, 2016.)
SUPPORT:
Valley Clean Air Now (sponsor)
Alliance of Automobile Manufacturers
Bay Area Air Quality Management District
Charge Ahead California
Coalition for Clean Air
Communities for a Better Environment
Environment California
Greenlining Institute
Natural Resources Defense Council
Sacramento Metropolitan Air Quality Management District
Union of Concerned Scientists
OPPOSITION:
None received
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