Amended in Assembly August 19, 2016

Amended in Senate April 7, 2016

Senate Bill No. 1387

Introduced by Senators De León, Allen, and Lara

February 19, 2016

An act to begin delete amend end delete begin insert amend, repeal, and add end insert Sections begin delete 39616, 40420, end delete begin insert 40420 end insert and 40424 begin delete of end delete begin insert of, and to add Section 40426.1 to, end insert the Health and Safety Code, relating to nonvehicular air pollution.

LEGISLATIVE COUNSEL’S DIGEST

SB 1387, as amended, De León. begin delete Nonvehicular air pollution: market-based incentive programs: end delete South Coast Air Quality Management District board.

begin delete

(1) Existing law authorizes the board of an air pollution control or air quality management district to adopt a market-based incentive program as an element of a district’s plan for the attainment of the state or federal ambient air quality standards. Existing law requires a district board, within 5 years from the date of the adoption of a market-based incentive program, to commence public hearings to reassess the program and, within 7 years from the date of the air district’s initial adoption of the program, to ratify specified findings with the concurrence of the State Air Resources Board.

end delete begin delete

This bill instead would require a district board to submit to the State Air Resources Board for review and approval the district’s plan for attainment or a revision to that plan, as specified. The bill also would require a district board to submit to the state board for review and approval the district’s market-based incentive program and any revisions to that program, as specified. The bill would prescribe specified actions for the state board to take if the state board determines that a plan for attainment, a revision of a plan for attainment, a market-based incentive program, or a revision to a market-based incentive program do not comply with law. By adding to the duties of air districts, this bill would impose a state-mandated local program.

end delete begin delete

(2) Existing

end delete

begin insert Existing end insert law establishes the South Coast Air Quality Management District vested with the authority to regulate air emissions from stationary sources located in the South Coast Air Basin and establishes a district board, consisting of 13 members.

This begin delete bill end delete begin insert bill, until January 1, 2025, end insert would add 3 members to the district board, as specified. The bill would make various conforming changes.

begin insert

This bill also would prohibit a member of the south coast district board from being issued a vehicle from the south coast district for greater than 7 days in a 30-day period if the board member is eligible for a vehicle or vehicle allowance from the local government from which he or she is appointed.

end insert begin delete

The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

end delete begin delete

This bill would provide that no reimbursement is required by this act for a specified reason.

end delete

Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program:  begin delete yes end delete begin insert no end insert .

The people of the State of California do enact as follows:

begin delete

SECTION 1.  

Section 39616 of the Health and Safety Code is
amended to read:

39616.  

(a)  The Legislature hereby finds and declares all of
the following:

(1)  Several regions in California suffer from some of the worst
air quality in the United States.

(2)  While traditional command and control air quality regulatory
programs are effective in cleaning up the air, other options for
improvement in air quality, such as market-based incentive
programs, may be explored, provided that those programs result
in greater emission reductions while ensuring disadvantaged
communities, as identified pursuant to Section 39711, are not
disproportionately impacted by pollution.

(3)  The purpose of this section is to establish requirements
under which a district board may adopt market-based incentive
programs in a manner that achieves the greatest air quality
improvement while strengthening the state’s economy and
preserving jobs.

(b)  (1)  A district board may adopt a market-based incentive
program as an element of the district’s plan for the attainment of
the state or federal ambient air quality standards.

(2)  A market-based incentive program that satisfies the
conditions in this section may substitute for current command and
control regulations and future air quality measures that would
otherwise have been adopted as part of the district’s plan for
attainment, and may be implemented in lieu of some or all of the
control measures adopted by the district pursuant to Chapter 10
(commencing with Section 40910) of Part 3.

(c)  In adopting rules to implement a market-based incentive
program, a district board shall, at the time that the rules are
adopted, make express findings, and shall, at the time that the rules
are submitted to the state board, submit appropriate information
to substantiate the basis for making the findings that each of the
following conditions is met on an overall districtwide basis:

(1)  The program will result in an equivalent or greater reduction
in emissions at equivalent or less cost compared with current
command and control regulations and future air quality measures
that would otherwise have been adopted as part of the district’s
plan for attainment.

(2)  The program will provide a level of enforcement and
monitoring, to ensure compliance with emission reduction
requirements, comparable with command and control air quality
measures that would otherwise have been adopted by the district
for inclusion in the district’s plan for attainment.

(3)  The program will establish a baseline methodology that
provides appropriate credit so that stationary sources of air
pollution that have been modified prior to implementation of the
program to reduce stationary source emissions are treated equitably.

(4)  The program will not result in a greater loss of jobs or more
significant shifts from higher to lower skilled jobs, on an overall
districtwide basis, than that which would exist under command
and control air quality measures that would otherwise have been
adopted as part of the district’s plan for attainment. A finding of
compliance with this requirement may be made in the same manner
as the analyses made by the district to meet the requirements of
Section 40728.5.

(5)  The program will promote the privatization of compliance
and the availability of data in computer format. The district shall
endeavor to provide sources with the option to keep records by
way of electronic or computer data storage systems, rather than
mechanical devices, such as strip chart recorders.

(6)  The program will not in any manner delay, postpone, or
otherwise hinder district compliance with Chapter 10 (commencing
with Section 40910) of Part 3.

(7)  The program will not result in disproportionate impacts,
measured on an aggregate basis, on those stationary sources
included in the program compared to other permitted stationary
sources in the district’s plan for attainment.

(d)  (1)  A district’s plan for attainment or plan revision
submitted to the state board shall achieve equivalent emission
reductions and reduced cost and job impacts compared to current
command and control regulations and future air quality measures
that would otherwise have been adopted as part of the district’s
plan for attainment. A district shall not implement a market-based
incentive program or any revisions to an adopted market-based
incentive program unless the state board has determined that the
plan or plan revision complies with this paragraph.

(2)  (A) A plan or plan revision shall meet the provisions of
subdivision (c) and Section 40440.1 if applicable. The state board
shall review, approve, disapprove, or amend and approve the plan
or plan revision prior to program implementation, and shall make
its determination not later than 60 days from the date of submission
of the plan or plan revision.

(B) (i) If the state board determines that a plan or plan revision
submitted pursuant to this paragraph does not comply with this
section, the state board within 60 days of the date of the submission
of the plan or plan revision, shall do all of the following:

(I) Notify the district.

(II) Revise the plan or plan revision so that the plan or plan
revision complies with this section.

(III) Approve the plan or plan revision.

(ii) If the state board approves a plan or plan revision pursuant
to this subparagraph, the plan or plan revision shall take effect
immediately and be binding on the district.

(3)  (A) Upon the adoption of rules to implement the program
in accordance with subdivision (c), the district shall submit the
rules to the state board. The state board shall, within 90 days from
the date of submission, determine whether the rules meet the
requirements of this section and Section 40440.1, if applicable.
This paragraph does not prohibit the district from implementing
the program upon the approval of the plan or plan revision and
prior to submission of the rules.

(B) (i) If the state board determines that a district rule does not
comply with this section, the state board, within 60 days of the
date of the submission of the rule, shall do all of the following:

(I) Notify the district.

(II) Revise the rule so that the rule complies with this section.

(III) Adopt the rule.

(ii) If the state board approves a rule pursuant to this
subparagraph, the rule shall take effect immediately and have the
same legal force and effect as a district rule.

(e)  Within five years from the date of the adoption of a
market-based incentive program, the district board shall commence
public hearings to reassess the program and shall, not later than
seven years from the date of the district’s initial adoption of the
program, ratify the findings required pursuant to paragraphs (1),
(2), (5), and (6) of subdivision (c) and the district’s compliance
with Section 40440.1, if applicable, with the concurrence of the
state board. If the district board fails to ratify the findings within
the seven-year period, the district board shall make appropriate
revisions to the district’s plan for attainment.

(f)  The district board shall reassess a market-based incentive
program if the market price of emission trading units exceeds a
predetermined level set by the district board. The district board
may take action to revise the program. A predetermined market
price review level shall be set in a public hearing in consideration
of the costs of command and control air quality measures that
would otherwise have been adopted as part of the district’s plan
for attainment, costs and factors submitted by interested parties,
and any other factors considered appropriate by the district board.
The district board may revise the market price review level for
emission trading units every three years during attainment plan
updates required under Section 40925. In revising the market price
review level, the district board shall consider the factors used in
setting the initial market price review level as well as other
economic impacts, including the overall impact of the program on
job loss, rate of business formation, and rate of business closure.

(g)  For sources not included in market-based incentive
programs, this section does not apply to, and shall in no way limit,
existing district authority to facilitate compliance with particular
emission control measures by imposing or authorizing sourcewide
emission caps, alternative emission control plans, stationary for
mobile source emission trades, mobile for mobile source emission
trades, and similar measures, whether imposed or authorized by
rule or permit condition.

(h)  This section does not apply to the implementation of
market-based transportation control measures that do not involve
emissions trading.

end delete

begin delete SEC. 2. end delete

begin insert SECTION 1. end insert   

Section 40420 of the Health and Safety Code is
amended to read:

40420.  

(a) The south coast district shall be governed by a
district board consisting of 16 members appointed as follows:

(1) (A) Two members appointed by the Governor, with the
advice and consent of the Senate.

(B) One member appointed pursuant to this paragraph shall begin delete be
a representative of a bona fide nonprofit environmental justice
organization that advocates for clean air and pollution reductions
in one or more communities within the South Coast Air Basin. end delete

begin insert reside in and work directly with communities in the South Coast
Air Basin that are disproportionately burdened by and vulnerable
to high levels of pollution and issues of environmental justice,
including, but not limited to, communities with diverse racial and
ethnic populations and communities with low-income populations.
In addition to any other applicant who may be considered, the
Governor shall accept an application from a member of a city
council or county board of supervisors who meets the criteria in
this subparagraph and shall give appropriate consideration to
appointing that applicant. end insert

(2) (A) Two members appointed by the Senate Committee on
Rules.

(B) One member appointed pursuant to this paragraph shall begin delete be
a representative of a bona fide nonprofit environmental justice
organization that advocates for clean air and pollution reductions
in one or more communities within the South Coast Air Basin. end delete

begin insert reside in and work directly with communities in the South Coast
Air Basin that are disproportionately burdened by and vulnerable
to high levels of pollution and issues of environmental justice,
including, but not limited to, communities with diverse racial and
ethnic populations and communities with low-income populations.
In addition to any other applicant who may be considered, the
Senate Committee on Rules shall accept an application from a
member of a city council or county board of supervisors who meets
the criteria in this subparagraph and shall give appropriate
consideration to appointing that applicant. end insert

(3)  (A) Two members appointed by the Speaker of the
Assembly.

(B) One member appointed pursuant to this paragraph shall begin delete be
a representative of a bona fide nonprofit environmental justice
organization that advocates for clean air and pollution reductions
in one or more communities within the South Coast Air Basin. end delete

begin insert reside in and work directly with communities in the South Coast
Air Basin that are disproportionately burdened by and vulnerable
to high levels of pollution and issues of environmental justice,
including, but not limited to, communities with diverse racial and
ethnic populations and communities with low-income populations.
In addition to any other applicant who may be considered, the
Speaker of the Assembly shall accept an application from a member
of a city council or county board of supervisors who meets the
criteria in this subparagraph and shall give appropriate
consideration to appointing that applicant. end insert

(4) Four members appointed by the boards of supervisors of the
counties in the south coast district. Each board of supervisors shall
appoint one of these members, who shall be one of the following:

(A) A member of the board of supervisors of the county making
the appointment.

(B) A mayor or member of a city council from a city in the
portion of the county making the appointment that is included in
the south coast district.

(5) Three members appointed by cities in the south coast district.
The city selection committee of Orange, Riverside, and San
Bernardino Counties shall each appoint one of these members,
who shall be either a mayor or a member of the city council of a
city in the portion of the county included in the south coast district.

(6) A member appointed by the cities of the western region of
Los Angeles County, consisting of the Cities of Agoura Hills,
Artesia, Avalon, Bell, Bellflower, Bell Gardens, Beverly Hills,
Calabasas, Carson, Cerritos, Commerce, Compton, Cudahy, Culver
City, Downey, El Segundo, Gardena, Hawaiian Gardens,
Hawthorne, Hermosa Beach, Hidden Hills, Huntington Park,
Inglewood, La Habra Heights, La Mirada, Lakewood, Lawndale,
Lomita, Long Beach, Lynwood, Malibu, Manhattan Beach,
Maywood, Montebello, Norwalk, Palos Verdes Estates, Paramount,
Pico Rivera, Rancho Palos Verdes, Redondo Beach, Rolling Hills,
Rolling Hills Estates, Santa Fe Springs, Santa Monica, Signal Hill,
South Gate, Torrance, Vernon, West Hollywood, Westlake Village,
and Whittier. These cities shall organize as a city selection
committee for the purposes of subdivision (f), and shall be known
as the city selection committee of the western region of Los
Angeles County. The member appointed shall be either a mayor
or a member of the city council of a city in the western region.

(7) A member appointed by the cities of the eastern region of
Los Angeles County, consisting of the cities in Los Angeles County
that are not listed in paragraph (6) or (8), and excluding the Cities
of Lancaster, Los Angeles, and Palmdale. These cities shall
organize as a city selection committee for the purposes of
subdivision (f), and shall be known as the city selection committee
of the eastern region of Los Angeles County. The member
appointed shall be either a mayor or a member of the city council
of a city in the eastern region.

(8) A member appointed by the Mayor of the City of Los
Angeles from among the members of the Los Angeles City
Council.

(b)  All members shall be appointed on the basis of their
demonstrated interest and proven ability in the field of air pollution
control and their understanding of the needs of the general public
in connection with air pollution problems of the South Coast Air
Basin.

(c) The member appointed by the Governor who is not the
member appointed pursuant to subparagraph (B) of paragraph (1)
of subdivision (a) shall be either a physician who has training and
experience in the health effects of air pollution, an environmental
engineer, a chemist, a meteorologist, or a specialist in air pollution
control.

(d) Each member shall be appointed on the basis of his or her
ability to attend substantially all meetings of the south coast district
board, to discharge all duties and responsibilities of a member of
the south coast district board on a regular basis, and to participate
actively in the affairs of the south coast district. A member shall
not designate an alternate for any purpose or otherwise be
represented by another in his or her capacity as a member of the
south coast district board.

(e) Each appointment by a board of supervisors shall be
considered and acted on at a duly noticed, regularly scheduled
hearing of the board of supervisors, which shall provide an
opportunity for testimony on the qualifications of the candidates
for appointment.

(f) The appointments by cities in the south coast district shall
be considered and acted on at a duly noticed meeting of the city
selection committee, which shall meet in a government building
and provide an opportunity for testimony on the qualifications of
the candidates for appointment. Each appointment shall be made
by not less than a majority of all the cities in the portion of the
county included in the south coast district having not less than a
majority of the population of all the cities in the portion of the
county included in the south coast district. Population shall be
determined on the basis of the most recent verifiable census data
developed by the Department of Finance. Persons residing in
unincorporated areas or areas of a county outside the south coast
district shall not be considered for the purposes of this subdivision.

(g) The members appointed by the Senate Committee on Rules
and the Speaker of the Assembly who are not the members
appointed pursuant to subparagraph (B) of paragraph (2) or
subparagraph (B) of paragraph (3) of subdivision (a) shall have
one or more of the qualifications specified in subdivision (c) or
shall be a public member. begin delete None of those end delete begin insert Those end insert appointed members
may begin insert not end insert be a locally elected official.

(h) All members shall be residents of the district.

(i) (1) The member who was serving on the district board as
of June 1, 2007, who had been appointed to represent the eastern
region of Los Angeles County shall be deemed on January 1, 2008,
to be the member appointed to represent the western region of Los
Angeles County pursuant to paragraph (6) of subdivision (a) and
shall serve from January 1, 2008, until the end of the term of office
for the member who had been appointed to represent the western
region of Los Angeles County. At the end of that term, the city
selection committee of the western region of Los Angeles County
shall make an appointment pursuant to paragraph (6) of subdivision
(a).

(2) The member who was serving on the district board as of
June 1, 2007, who had been appointed to represent the western
region of Los Angeles County shall be deemed on January 1, 2008,
to be the member appointed pursuant to paragraph (8) of
subdivision (a) until the end of that member’s term. At the end of
that term, the Mayor of the City of Los Angeles shall make an
appointment pursuant to paragraph (8) of subdivision (a).

(3) On or after January 1, 2008, the city selection committee of
the eastern region of Los Angeles County shall convene promptly
to make an appointment pursuant to paragraph (7) of subdivision
(a).

begin insert

(j) This section shall remain in effect only until January 1, 2025,
and as of that date is repealed, unless a later enacted statute, that
is enacted before January 1, 2025, deletes or extends that date.

end insert

begin insert

begin insert SEC. 2. end insert   

end insert

begin insert Section 40420 is added to the end insert begin insert Health and Safety Code end insert begin insert ,
to read: end insert

begin insert

begin insert 40420. end insert   

(a) The south coast district shall be governed by a
district board consisting of 13 members appointed as follows:

(1) One member appointed by the Governor, with the advice
and consent of the Senate.

(2) One member appointed by the Senate Committee on Rules.

(3) One member appointed by the Speaker of the Assembly.

(4) Four members appointed by the boards of supervisors of
the counties in the south coast district. Each board of supervisors
shall appoint one of these members, who shall be one of the
following:

(A) A member of the board of supervisors of the county making
the appointment.

(B) A mayor or member of a city council from a city in the
portion of the county making the appointment that is included in
the south coast district.

(5) Three members appointed by cities in the south coast district.
The city selection committee of Orange, Riverside, and San
Bernardino Counties shall each appoint one of these members,
who shall be either a mayor or a member of the city council of a
city in the portion of the county included in the south coast district.

(6) A member appointed by the cities of the western region of
Los Angeles County, consisting of the Cities of Agoura Hills,
Artesia, Avalon, Bell, Bellflower, Bell Gardens, Beverly Hills,
Calabasas, Carson, Cerritos, Commerce, Compton, Cudahy,
Culver City, Downey, El Segundo, Gardena, Hawaiian Gardens,
Hawthorne, Hermosa Beach, Hidden Hills, Huntington Park,
Inglewood, La Habra Heights, La Mirada, Lakewood, Lawndale,
Lomita, Long Beach, Lynwood, Malibu, Manhattan Beach,
Maywood, Montebello, Norwalk, Palos Verdes Estates, Paramount,
Pico Rivera, Rancho Palos Verdes, Redondo Beach, Rolling Hills,
Rolling Hills Estates, Santa Fe Springs, Santa Monica, Signal Hill,
South Gate, Torrance, Vernon, West Hollywood, Westlake Village,
and Whittier. These cities shall organize as a city selection
committee for the purposes of subdivision (f), and shall be known
as the city selection committee of the western region of Los Angeles
County. The member appointed shall be either a mayor or a
member of the city council of a city in the western region.

(7) A member appointed by the cities of the eastern region of
Los Angeles County, consisting of the cities in Los Angeles County
that are not listed in paragraph (6) or (8), and excluding the Cities
of Lancaster, Los Angeles, and Palmdale. These cities shall
organize as a city selection committee for the purposes of
subdivision (f), and shall be known as the city selection committee
of the eastern region of Los Angeles County. The member
appointed shall be either a mayor or a member of the city council
of a city in the eastern region.

(8) A member appointed by the Mayor of the City of Los Angeles
from among the members of the Los Angeles City Council.

(b)  All members shall be appointed on the basis of their
demonstrated interest and proven ability in the field of air pollution
control and their understanding of the needs of the general public
in connection with air pollution problems of the South Coast Air
Basin.

(c) The member appointed by the Governor shall be either a
physician who has training and experience in the health effects of
air pollution, an environmental engineer, a chemist, a
meteorologist, or a specialist in air pollution control.

(d) Each member shall be appointed on the basis of his or her
ability to attend substantially all meetings of the south coast district
board, to discharge all duties and responsibilities of a member of
the south coast district board on a regular basis, and to participate
actively in the affairs of the south coast district. A member shall
not designate an alternate for any purpose or otherwise be
represented by another in his or her capacity as a member of the
south coast district board.

(e) Each appointment by a board of supervisors shall be
considered and acted on at a duly noticed, regularly scheduled
hearing of the board of supervisors, which shall provide an
opportunity for testimony on the qualifications of the candidates
for appointment.

(f) The appointments by cities in the south coast district shall
be considered and acted on at a duly noticed meeting of the city
selection committee, which shall meet in a government building
and provide an opportunity for testimony on the qualifications of
the candidates for appointment. Each appointment shall be made
by not less than a majority of all the cities in the portion of the
county included in the south coast district having not less than a
majority of the population of all the cities in the portion of the
county included in the south coast district. Population shall be
determined on the basis of the most recent verifiable census data
developed by the Department of Finance. Persons residing in
unincorporated areas or areas of a county outside the south coast
district shall not be considered for the purposes of this subdivision.

(g) The members appointed by the Senate Committee on Rules
and the Speaker of the Assembly shall have one or more of the
qualifications specified in subdivision (c) or shall be a public
member. None of those appointed members may be a locally elected
official.

(h) All members shall be residents of the district.

(i) This section shall become operative on January 1, 2025.

end insert

SEC. 3.  

Section 40424 of the Health and Safety Code is
amended to read:

40424.  

(a) Except as provided in subdivision (b), nine members
of the south coast district board shall constitute a quorum, and no
official action shall be taken by the south coast district board except
in the presence of a quorum and upon the affirmative votes of a
majority of the members of the south coast district board.

(b)  Notwithstanding subdivision (a), whenever there are two
or more vacancies on the south coast district board, eight members
shall constitute a quorum, and the two vacant positions shall not
be counted toward the majority required for official action by the
south coast district board. Thereafter, whenever at least one of
those vacancies is filled, the quorum and voting requirements of
subdivision (a) shall apply.

begin insert

(c) This section shall remain in effect only until January 1, 2025,
and as of that date is repealed, unless a later enacted statute, that
is enacted before January 1, 2025, deletes or extends that date.

end insert

begin insert

begin insert SEC. 4. end insert   

end insert

begin insert Section 40424 is added to the end insert begin insert Health and Safety Code end insert begin insert ,
to read: end insert

begin insert

begin insert 40424. end insert   

(a) Except as provided in subdivision (b), seven
members of the south coast district board shall constitute a
quorum, and no official action shall be taken by the south coast
district board except in the presence of a quorum and upon the
affirmative votes of a majority of the members of the south coast
district board.

(b) Notwithstanding subdivision (a), whenever there are two or
more vacancies on the south coast district board, six members
shall constitute a quorum, and the two vacant positions shall not
be counted toward the majority required for official action by the
south coast district board. Thereafter, whenever at least one of
those vacancies is filled, the quorum and voting requirements of
subdivision (a) shall apply.

(c) This section shall become operative on January 1, 2025.

end insert

begin insert

begin insert SEC. 5. end insert   

end insert

begin insert Section 40426.1 is added to the end insert begin insert Health and Safety
Code end insert begin insert , to read: end insert

begin insert

begin insert 40426.1. end insert   

A member of the south coast district board who is
eligible for a vehicle or vehicle allowance from the local
government from which he or she is appointed shall not be issued
a vehicle from the south coast district for greater than seven days
in a 30-day period.

end insert

begin delete

SEC. 4.  

No reimbursement is required by this act pursuant to
Section 6 of Article XIII B of the California Constitution because
a local agency or school district has the authority to levy service
charges, fees, or assessments sufficient to pay for the program or
level of service mandated by this act, within the meaning of Section
17556 of the Government Code.

end delete