BILL ANALYSIS Ó
SENATE COMMITTEE ON ENVIRONMENTAL QUALITY
Senator Wieckowski, Chair
2015 - 2016 Regular
Bill No: AB 1965
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|Author: |Cooper |
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|Version: |5/31/2016 |Hearing |6/29/2016 |
| | |Date: | |
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|Urgency: |No |Fiscal: |Yes |
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|Consultant:|Rebecca Newhouse |
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SUBJECT: Vehicle retirement and replacement.
ANALYSIS:
Existing law:
1) Establishes the Enhanced Fleet Modernization Program (EFMP),
which allows for the voluntary retirement of passenger vehicles
and light-duty and medium-duty trucks that are high polluters
and requires the program be administered by the Bureau of
Automotive Repair (BAR) pursuant to guidelines adopted by the
California Air Resources Board (ARB). (Health and Safety Code
§44125)
2) Establishes the Charge Ahead Initiative administered by ARB
with the goals of reaching at least one million zero-emission
and near-zero-emission vehicles by January 1, 2023, and
increasing accessibility for disadvantaged, low-income, and
moderate-income communities. ARB is required to establish
programs that further increase access to and direct benefits
for disadvantaged, low-income, and moderate-income communities
and consumers from electric transportation. (HSC §44258 et
seq.)
3) Under the California Global Warming Solutions Act of 2006 (also
known as
AB 32), requires ARB to determine the 1990 statewide greenhouse
gas (GHG) emissions level and approve a statewide GHG emissions
limit that is equivalent to that level, to be achieved by 2020,
and to adopt GHG emissions reductions measures by regulation.
AB 1965 (Cooper) Page 2 of ?
ARB is authorized to include the use of market-based mechanisms
to comply with these regulations. (Health and Safety Code
§38500 et seq.)
4) Establishes the Greenhouse Gas Reduction Fund (GGRF) in the
State Treasury, requires all moneys, except for fines and
penalties, collected pursuant to a market-based mechanism be
deposited in the fund. (Government Code §16428.8)
5) Prohibits the state from approving allocations for a measure or
program using GGRF moneys except after determining that the use
of those moneys furthers the regulatory purposes of AB 32, and
requires moneys from the GGRF be used to facilitate the
achievement of reductions of GHG emissions in California. (HSC
§39712)
This bill:
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 2017-18 and every fiscal
year thereafter.
2) Requires ARB, in consultation with BAR, to meet these goals by
updating the program guidelines by July 1, 2018, to:
a) Require specific steps to be taken to ensure that the
vehicle replacement component of the program is available in
all districts that have more than one million residents.
b) Require program funding for targeted outreach in
low-income communities or disadvantaged communities for the
program is evaluated and, if necessary, enhanced to obtain
the program's retirement and replacement goals.
c) Require, where applicable improved coordination,
integration, and partnerships with other programs that
target disadvantaged communities and receive GGRF moneys.
3) Requires ARB, by July 1, 2018 and every other year thereafter,
to collect and post on its Internet website the following
information:
a) Program performance relative to the goals it adopted
AB 1965 (Cooper) Page 3 of ?
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) An analysis broken down by district of the program's
performance to identify areas to be emphasized when setting
future goals or updating the program guidelines.
4) Authorizes ARB, upon appropriation by the Legislature, to
allocate moneys 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.
Background
1) Air pollution in California and the transportation sector. The
federal Clean Air Act, and its implementing regulations are
intended to protect public health and environmental quality by
limiting and reducing pollution from various sources. Under the
federal Clean Air Act, the United States Environmental
Protection Agency (US EPA) establishes National Ambient Air
Quality Standards (NAAQS) that apply for outdoor air throughout
the country. These federal standards exist for several air
pollutants due to their negative impact on public health above
specified concentrations, including ozone, particulate matter
(PM), NOx, oxides of sulfur (SOx), carbon monoxide, and lead.
US EPA reviews each NAAQS at five-year intervals to ensure that
the standards are based on the most recent scientific
information.
Regions that do not meet the national standards for any one of
the standards are designated nonattainment areas. The Clean
Air Act sets deadlines for attainment based on the severity of
nonattainment and requires states to develop comprehensive
plans, known as the state implementation plan (SIP), to attain
and maintain air quality standards for each area designated
nonattainment for an NAAQS.
California has some of the most severe air pollution problems
in the country. The South Coast and San Joaquin air basins,
which contain over half of the state's population, are extreme
nonattainment regions (the highest degree of severity) for
AB 1965 (Cooper) Page 4 of ?
ozone pollution and are both nonattainment regions for
particulate matter (PM).
Ground level ozone (or tropospheric ozone) is a primary
component of smog and is formed from the reaction of NOx with
volatile organic compounds in sunlight. Ozone has a number of
negative health effects including irritated respiratory system,
reduced lung function, aggravated asthma and inflammation and
damage of the lining of the lung. Active children are at
highest risk from ozone exposure.
PM can be directly emitted from combustion or can be formed in
the atmosphere when gaseous pollutants such as SO2 and NOx
react to form fine particles. Very fine particulate matter is
particularly dangerous since it burrows deep into the lungs
where it can enter the bloodstream and harm the heart and other
organs. Fine particulate pollution poses an especially
critical health danger for children, the elderly, and people
with existing health problems. Exposure to PM 2.5 is also
linked to cardiovascular disease. A 2010 ARB analysis based on
scientific assessments by US EPA, reported that approximately
9,000 people in California are estimated to die prematurely
each year as a result of exposure to fine particle pollution.
Nationally and statewide, the transportation sector is
responsible for a major fraction of air pollution, and in
particular NOx, which contributes to both ozone and PM
formation. Across the US, motor vehicles emit more than half
of all NOx emissions. In California, the transportation sector
accounts for approximately 80% of the NOx emissions, and
according to ARB, 75% of vehicular air pollution in the state
is caused by just 25% of the fleet.
2) Car scrap program. 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.
3) EFMP and EFMP Plus-Up. Existing state law establishes the
Enhanced Fleet Modernization Program (EFMP), administered by
the ARB and BAR. EFMP provides for the voluntary retirement of
passenger vehicles and light- and medium-duty trucks that are
AB 1965 (Cooper) Page 5 of ?
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, now known as
EFMP Plus-Up, which is operated by the San Joaquin and South
Coast air districts in partnership with ARB (both designated
extreme non-attainment areas for ozone). 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 up to $12,000 total
toward the purchase of a new car.
Funding. EFMP is funded through vehicle surcharges, whereas
EFMP Plus-Up has been funded through GGRF moneys. For 2015-16,
funding for 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 (of which $30 million is Greenhouse Gas
Reduction Fund), and would provide incentives for about 4,500
vehicles.
EFMP Plus-Up pilot program was funded in FY 2015-16 with $20
million from GGRF. The 2016-17 FY investment plan for ARB's
low carbon transportation investments proposes $30 million from
GGRF.
Implementing EFMP Plus-Up. 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
AB 1965 (Cooper) Page 6 of ?
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.
Comments
1) Purpose of Bill. According to the author, "AB 1965 will
provide financial incentives for low-income individuals to
replace their high polluting, less reliable and inefficient
vehicles with newer, cleaner and more reliable cars while
helping reduce vehicular pollution and improve air quality.
Additionally, the bill requires increased targeted outreach to
low-income households and disadvantaged communities to ensure
that EFMP Plus-Up is accessible to the neediest Californians.
AB 1965 also requires ARB to set specific goals for retirement
and replacement of high polluting passenger vehicles."
2) Combining efforts. The Committee will also be hearing AB 1691
(Gipson) which also directs ARB to update their EFMP
guidelines, relative to the EFMP Plus-Up program. AB 1691
works to reduce and eliminate backlogs and waitlists for the
EFMP Plus-Up program, and prioritize older, higher-polluting
vehicles for incentives.
AB 1965 (Cooper), the subject of this analysis, also directs
ARB to update their EFMP guidelines, and requires the update by
July 1, 2018. Specifically, AB 1965 expands the EFMP Plus-Up
program to additional local air districts.
Although the bills are not necessarily conflicting, they
establish different timelines for when these updates to the
EFMP guidelines relative to the EFMP Plus-Up program are
required. As updating guidelines pursuant to the
Administrative Procedures Act is a time consuming process, and
could result in significant administrative expense, the authors
of these measures may wish to combine efforts going forward to
consolidate both measures into a single bill.
Related/Prior Legislation
AB 1965 (Cooper) Page 7 of ?
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 by this committee today.
SB 1275 (de León, Chapter 530, Statutes of 2014) established the
Charge Ahead Initiative, to provide incentives to increase the
availability of zero-emission vehicles and near-zero-emission
vehicles, particularly to low-income and moderate-income consumers
and disadvantaged communities.
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.
DOUBLE REFERRAL:
This measure was heard in Senate Transportation and Housing
Committee on June 21, 2016, and passed out of committee with a
vote of 8-1.
SOURCE: Valley Clean Air Now
SUPPORT:
Alliance of Automobile Manufacturers
Bay Area Air Quality Management District
Charge Ahead California
Coalition for Clean Air
Communities for a Better Environment
Environment California Research & Policy Center
Natural Resources Defense Council
Sacramento Metropolitan Air Quality Management District
The Greenling Institute
Union of Concerned Scientists
OPPOSITION:
None received
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