BILL ANALYSIS                                                                                                                                                                                                    Ó



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          Date of Hearing:  August 19, 2015


                        ASSEMBLY COMMITTEE ON APPROPRIATIONS


                                 Jimmy Gomez, Chair


          SB 513  
          (Beall) - As Amended August 17, 2015


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          Urgency:  No  State Mandated Local Program:  NoReimbursable:  No


          SUMMARY:


          This bill makes numerous modifications to the Carl Moyer  
          Memorial Air Quality Standards Attainment Program and local air  
          district AB 923 incentive programs. Specifically, this bill:









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          1)Clarifies that local air districts can continue to levy AB 923  
            program fees, even after they come into compliance with  
            National and California Ambient Air Quality Standards  
            (attainment), in order to maintain compliance with the  
            standards. 

          2)Specifies that repowering of school buses and alternative fuel  
            and electric infrastructure are eligible AB 923 projects. 

          3)Requires the Air Resources Board (ARB), in collaboration with  
            the air districts, to adjust, as specified, the  
            cost-effectiveness formula used to evaluate project proposals  
            under the Moyer Program.

          4)Allows for leveraging of Moyer Program funds with other public  
            funding sources, including the Greenhouse Gas Reduction Fund  
            (GGRF).

          5)Recognizes greenhouse gas (GHG) reductions, so that funded  
            projects can achieve both criteria pollutant and GHG emissions  
            reductions.

          6)Allows the ARB to determine additional project categories  
            under the Moyer Program as necessary to meet state air quality  
            goals and allows funding for infrastructure projects and  
            certain additional marine projects.

          7)Streamlines and updates program administrative requirements,  
            and increases the statutory cap on administrative and outreach  
            expenditures (as a percentage of total program expenditures)  
            by the ARB and local districts; generally a 0.5% increase for  
            the ARB and increases of 1.25% for larger districts and 2.5%  
            for smaller districts.

          FISCAL EFFECT:


          The Carl Moyer Program is funded through a portion of the smog  








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          abatement fee included in the annual registration of newer  
          vehicles ($6) and through a fee on the sale of new tires ($0.75)  
          that together generate about $69 million annually. ARB disburses  
          these funds to the local air districts, who implement the  
          programs in their local jurisdictions.


          The AB 923 program is funded from a $2 surcharge on vehicle  
          registration fees in areas where a local air district's board  
          has approved the collection of these funds. Currently, 19 of the  
          states 35 air districts collect these funds, which total about  
          $50 million annually statewide.


          This bill will create unknown, but potentially significant cost  
          pressures by expanding eligible uses of the funds generated by  
          both programs. There will also be additional cost pressure on  
          the GGRF for projects that seek funding from both the GGRF and  
          the Moyer Program.


          The ARB indicates that it will not require additional  
          administrative resources to implement the provisions of this  
          bill. The increase in the cap on administrative costs will allow  
          ARB to spend an additional $350,000 on administration and  
          $350,000 on outreach annually from current program revenues. The  
          local districts together would be allowed to spend at least an  
          additional $860,000 from current Moyer Program revenues on  
          administration. For the AB 923 program,  local districts  
          together would be allowed to spend an additional $625,000 from  
          current program revenues on administration annually. 


          COMMENTS:


          Background and Purpose. The Moyer Program, enacted in 1999 and  
          administered by the ARB and local air districts, funds the  
          incremental cost of cleaner-than-required vehicles, engines, and  








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          equipment. The primary objective of the program, which provides  
          grants through the state's 35 air districts, is to achieve air  
          quality emission reductions that would not otherwise occur  
          through regulations or other legal mandates. The Moyer Program  
          was expanded by AB 923 (Firebaugh), Chapter 707, Statutes of  
          2004 which authorized an increase in the surcharge local air  
          districts are allowed to levy on motor vehicle registrations  
          within their jurisdictions from $4 to $6, expanded the types of  
          emissions covered by the Moyer Program and increased the tire  
          fee by $0.75 to fund programs under ARB and local air districts  
          to mitigate or remediate air pollution caused by tires.





          AB 8 (Perea) Chapter 401, Statutes of 2013 extended, until  
          January 1, 2024, the assessment of the higher tire fee and the  
          ability of locals to assess the vehicle registration surcharge.  
          AB 8 also required ARB to convene a workgroup to evaluate the  
          program. The workgroup identified a number of program  
          improvements, and many were addressed by ARB in 2014 through  
          updates to the Moyer Program Guidelines. SB 513 encompasses  
          recommendations from the work group that require statutory  
          changes. Specifically, SB 513, in part, clarifies that local air  
          districts can continue to levy program fees even after they  
          achieve attainment, makes adjustments to cost-effectiveness  
          calculations to incentivize the statewide deployment of cleaner  
          technologies, encourages leveraging of other public funding  
          sources, recognizes GHG reductions so that funded projects can  
          achieve both criteria pollutant and GHG emissions reductions,  
          and streamlines program administration.





          Analysis Prepared by:Chuck Nicol / APPR. / (916)  
          319-2081








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