BILL ANALYSIS Ó
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|SENATE RULES COMMITTEE | SB 513|
|Office of Senate Floor Analyses | |
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UNFINISHED BUSINESS
Bill No: SB 513
Author: Beall (D)
Amended: 8/31/15
Vote: 21
SENATE TRANS. & HOUSING COMMITTEE: 10-0, 4/21/15
AYES: Beall, Cannella, Allen, Bates, Galgiani, Leyva, McGuire,
Mendoza, Roth, Wieckowski
NO VOTE RECORDED: Gaines
SENATE ENVIRONMENTAL QUALITY COMMITTEE: 7-0, 4/29/15
AYES: Wieckowski, Gaines, Bates, Hill, Jackson, Leno, Pavley
SENATE APPROPRIATIONS COMMITTEE: 7-0, 5/28/15
AYES: Lara, Bates, Beall, Hill, Leyva, Mendoza, Nielsen
SENATE FLOOR: 40-0, 6/3/15
AYES: Allen, Anderson, Bates, Beall, Berryhill, Block,
Cannella, De León, Fuller, Gaines, Galgiani, Glazer, Hall,
Hancock, Hernandez, Hertzberg, Hill, Hueso, Huff, Jackson,
Lara, Leno, Leyva, Liu, McGuire, Mendoza, Mitchell, Monning,
Moorlach, Morrell, Nguyen, Nielsen, Pan, Pavley, Roth, Runner,
Stone, Vidak, Wieckowski, Wolk
ASSEMBLY FLOOR: 54-26, 9/2/15 - See last page for vote
SUBJECT: Carl Moyer Memorial Air Quality Standards Attainment
Program: fees
SOURCE: California Air Pollution Control Officers Association
DIGEST: This bill makes a number of changes to the Carl Moyer
Memorial Air Quality Standards Attainment Program (Carl Moyer
Program).
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Assembly Amendments (1) authorize the Carl Moyer Program to
provide grants for school bus projects, including replacement,
repower, and retrofits, consistent with the existing Lower
Emission School Bus Program; and (2) make other technical and
clarifying changes.
ANALYSIS:
Existing law:
1)Establishes, pursuant to AB 1571 (Villaraigosa, Chapter 923,
Statutes of 1999), the Carl Moyer Memorial Air Quality
Standards Attainment Program (Carl Moyer Program) under the
state Air Resources Board (ARB). This program provides grants
through the state's 35 local air quality management and air
pollution control districts (air districts) for deployment of
engines, equipment, and emission-reduction technologies that
are cleaner than required by current laws or regulations. The
Carl Moyer Program provides approximately $60 million for
projects each year throughout the state. The Carl Moyer
Program was initially funded primarily through General Fund
appropriations.
2)Expands the Carl Moyer Program, pursuant to AB 923 (Firebaugh,
Chapter 707, Statutes of 2004), to address particulate matter
(PM) and reactive organic gases (ROG) emissions in addition to
nitrogen oxide (NOx) emissions. It established ongoing
funding by authorizing air districts to collect an additional
$2 surcharge on vehicle registration fees to fund
emission-reduction projects and by establishing a fee of 75
cents per tire. The AB 923 program funds Carl Moyer
Program-eligible projects as well as agricultural equipment,
school bus, and vehicle scrap programs.
3)Includes a provision, pursuant to AB 8 (Perea, Chapter 401,
Statutes of 2013), extending the tire fees and the AB 923
program until January 1, 2024. (The vehicle registration
surcharge does not have a sunset.) AB 8 also required ARB to
convene a workgroup to evaluate the Carl Moyer Program. ARB
and the air districts convened two public meetings of the
workgroup, in June and October 2014, to solicit input from
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stakeholders. ARB and the air districts then worked together
to develop statutory language to implement the Carl Moyer
Program improvements identified by the workgroup.
4)Requires a project to meet a cost-effectiveness test in order
to be eligible for funding. The air district reviewing the
project application calculates the project's
cost-effectiveness by dividing the annualized cost of the
potential project (dollars per year) by the annual weighted
surplus emission reductions the project will achieve (tons per
year). Initially, other public funds had to be deducted from
the cost-effectiveness calculation, to help ensure the Carl
Moyer Program did not overpay for projects receiving funds
from other sources. AB 1507 (Lieu, Chapter 571, Statutes of
2010) required ARB to revise program guidelines to exclude
from the calculation funds from federal greenhouse gas (GHG)
emission-reduction programs and the California Energy
Commission's Alternative and Renewable Fuel and Vehicle
Technology Program. AB 1507 aimed to address the unintended
consequence of discouraging projects that accomplish multiple
goals.
5)Prohibits the Carl Moyer Program from providing grants to
projects with a cost-effectiveness of more than $13,600 per
ton of NOx reduced in the state or a higher value that
reflects Consumer Price Index adjustments as determined by
ARB. For projects obtaining ROG and PM reductions, ARB shall
determine appropriate adjustment factors to calculate a
weighted cost-effectiveness.
6)Provides that the Carl Moyer Program shall only fund the
"incremental cost" of a project, defined as the cost of the
project minus a baseline cost that would otherwise be incurred
by the applicant in the normal course of business (e.g., to
meet existing federal, state, or local requirements).
Existing law also states that incremental cost may include
added lease or fuel costs as well as incremental capital
costs.
7)Provides that the following projects are eligible under the AB
923 program: purchase of new school buses or retrofit of
existing school buses; vehicle retirement ("scrap") or repair;
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replacement of natural gas fuel tanks on school buses owned by
a school district that are 14 years or older, not to exceed
$20,000 per bus; and enhancement of deteriorating natural gas
fueling dispensers of fueling infrastructure operated by a
school district with a one-time funding amount of not more
than $500 per dispenser. The air district may not use more
than 5% of funds collected for administrative expenses.
8)Provides that the following projects are eligible under the
Carl Moyer Program: purchase of new very low- or
zero-emission vehicles or heavy-duty engines; retrofit of
engines or replacement of old engines with engines certified
to more stringent emissions standards or with electric motors
and drives; purchase and use of emission-reducing add-on
equipment; and light- and medium-duty vehicle projects. The
Carl Moyer Program may fund installation of fueling or
electrification infrastructure.
9)Provides that funds not expended by an air district within a
two-year period shall revert back to ARB within 60 days for
further allocation.
This bill makes multiple changes to the Carl Moyer and AB 923
programs, including the following.
1)Requires ARB to revise program guidelines to encourage
leveraging of other public funding sources.
2)Requires ARB, in collaboration with air districts, to
establish cost-effectiveness values in the program guidelines
that account for factors such as the cost of emission control
technologies and the cost-effectiveness values for NOx, PM, or
ROG for any adopted rule or control measure in any district's
approved state implementation plan or ARB rule.
3)Expands project eligibility to authorize repower and retrofit
school buses with cleaner engines; removes the dollar cap on
replacement of natural gas fuel tanks and dispensers on school
buses; removes the requirement that the bus be owned by a
school district; adds funding of certain alternative fuel and
electric infrastructure projects; and increases the
administrative set-aside.
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4)Deletes references to obsolete and redundant code sections,
revises and recasts a number of provisions, and makes related,
clarifying amendments.
Comments
Purpose. The author states that ARB and the state's local air
districts, with public and stakeholder input, have identified
several limitations of the Carl Moyer Program. These include
the inability to provide meaningful grant amounts to the
cleanest, most advanced technologies and the inability to
combine Carl Moyer Program funding with other funding sources.
This bill addresses these limitations by establishing a process
to adjust the cost-effectiveness limit; allowing greater
leveraging of funds from multiple sources; expanding eligible
project categories; and further streamlining the Carl Moyer
Program. The source of this bill is the California Air
Pollution Control Officers Association (CAPCOA), which
represents the state's 35 local air districts.
Time for an update. The Carl Moyer Program and the AB 923
program have enjoyed significant success: Since 1998, these
programs have cleaned up more than 46,000 engines and eliminated
174,600 tons of ozone precursors and 6,400 tons of PM. CAPCOA
notes that the project types originally identified in the Carl
Moyer and AB 923 programs were based on technology ideas
available at that time. This bill will provide flexibility to
better allow for both current and future technology
opportunities. CAPCOA also notes that for many years, virtually
all mobile emission reductions were surplus; however, as the
Legislature and ARB have enacted more laws and regulations, the
bar has moved much higher for achieving surplus reductions. In
addition, the cleanest technology to achieve air quality
standards has gotten more expensive, making it more difficult
for business owners to clean up their equipment. This bill
updates the Carl Moyer and AB 923 programs to help them more
effectively address the state's air quality concerns.
FISCAL EFFECT: Appropriation: No Fiscal
Com.:YesLocal: No
According to the Assembly Appropriations Committee:
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The Carl Moyer Program is funded through a portion of the smog
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 state's 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 Greenhouse Gas Reduction Fund (GGRF) for projects that
seek funding from both the GGRF and the Carl 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 Carl 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.
SUPPORT: (Verified9/1/15)
California Air Pollution Control Officers Association (source)
American Lung Association
Bay Area Air Quality Management District
Butte County Air Quality Management District
California Electric Transportation Coalition
California Fresh Fruit Association
California Natural Gas Vehicle Coalition
California Trucking Association
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CALSTART
Clean Energy
Coalition for Clean Air
Glenn County Board of Supervisors
Green California
Imperial County Air Pollution Control District
Imperial County Board of Supervisors
Rural County Representatives of California
Sacramento Metropolitan Air Quality Management District
San Joaquin Valley Air Pollution Control District
Santa Barbara County Air Pollution Control District
South Coast Air Quality Management District
Tehama County Board of Supervisors
U.S. Hybrid
Yolo-Solano Air Quality Management District
OPPOSITION: (Verified9/1/15)
None received
ASSEMBLY FLOOR: 54-26, 9/2/15
AYES: Achadjian, Alejo, Bloom, Bonilla, Bonta, Brown, Burke,
Calderon, Campos, Chau, Chiu, Chu, Cooley, Cooper, Dababneh,
Daly, Dodd, Eggman, Frazier, Cristina Garcia, Eduardo Garcia,
Gatto, Gipson, Gomez, Gonzalez, Gordon, Gray, Roger Hernández,
Holden, Jones-Sawyer, Levine, Lopez, Low, Mayes, McCarty,
Medina, Mullin, Nazarian, O'Donnell, Olsen, Perea, Quirk,
Rendon, Ridley-Thomas, Rodriguez, Salas, Santiago, Mark Stone,
Thurmond, Ting, Weber, Williams, Wood, Atkins
NOES: Travis Allen, Baker, Bigelow, Brough, Chang, Chávez,
Dahle, Beth Gaines, Gallagher, Grove, Hadley, Harper, Irwin,
Jones, Kim, Lackey, Linder, Maienschein, Mathis, Melendez,
Obernolte, Patterson, Steinorth, Wagner, Waldron, Wilk
Prepared by:Erin Riches / T. & H. / (916) 651-4121
9/2/15 18:54:17
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