BILL NUMBER: AB 2795	AMENDED
	BILL TEXT

	AMENDED IN SENATE   AUGUST 24, 1998
	AMENDED IN ASSEMBLY   MAY 26, 1998

INTRODUCED BY    Committee on Budget (Ducheny (Chair),
Aroner, Brown, Cardenas, Cardoza, Cedillo, Davis, Gallegos, Keeley,
Papan, Scott, Strom-Martin, Torlakson, and Wright)  
Assembly Member Oller 
    (Coauthors:  Senators Johannessen, Hurtt, and Thompson) 

                        MARCH 2, 1998

    An act relating to consumer affairs.   An
act to amend Sections 44000.5, 44011, 44012, 44013.5, 44014, 44015,
44017, 44020, 44021, 44024.5, 44033, 44036, 44045.5, 44050, 44056,
44060, 44062.1, 44081, and 44081.6 of, to add Section 44011.3 to, and
to repeal Sections 44003, 44010.5, 44014.2, 44014.4, 44014.5, and
44014.7 of, the Health and Safety Code, and to amend Section 4000.3
of the Vehicle Code, relating to air pollution, and declaring the
urgency thereof, to take effect immediately. 


	LEGISLATIVE COUNSEL'S DIGEST


   AB 2795, as amended,  Committee on Budget  
_____  .   Department of Consumer Affairs  
Motor vehicles:  smog check program  . 
   Existing law provides for the existence in state government of a
Department of Consumer Affairs.  Various boards and commissions are
within the jurisdiction of the department.
   This bill would express legislative intent to make necessary
statutory changes to implement the Budget Act of 1998 relative to the
Department of Consumer Affairs, including boards and commissions
within the department.  
   (1) Existing law establishes a motor vehicle inspection and
maintenance (smog check) program, administered by the Department of
Consumer Affairs; requires inspection of motor vehicles upon initial
registration, biennially upon renewal of registration, upon transfer
of ownership, and in certain other circumstances; and requires all
motor vehicles that are registered in designated areas of the state
to biennially obtain a certificate of compliance or noncompliance
with motor vehicle emission standards, except for certain exempted
motor vehicles.  Existing law also provides for an enhanced motor
vehicle inspection and maintenance program in each urbanized area of
the state, any part of which is classified by the United States
Environmental Protection Agency as a serious, severe, or extreme
nonattainment area for carbon monoxide with a design value greater
than 12.7 ppm, and in other areas of the state, as specified.
   This bill would repeal those provisions providing for an enhanced
program and would make related changes.
   This bill would also permit every motor vehicle subject to the
inspection program to be pretested, as defined.  The bill would also
require information contained in the renewal of registration notice
to notify the owner of the vehicle of the right to have the vehicle
pretested.
   (2) The bill would require the Bureau of Automotive Repair to
provide reimbursement to eligible smog check station owners for
certain costs incurred to comply with the enhanced smog check program
from specified funds appropriated pursuant to the Budget Act of
1998.
   (3) The bill would declare that it is to take effect immediately
as an urgency statute. 
   Vote:   majority   2/3  .
Appropriation:  no.  Fiscal committee:   no  
yes  .  State-mandated local program:  no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  
  SECTION 1.  It is the intent of the Legislature in  
  SECTION 1.  Section 44000.5 of the Health and Safety Code is
amended to read: 
   44000.5.  (a) The Legislature further finds and declares that the
motor vehicle inspection and maintenance program implemented under
this chapter has, since 1984, provided beneficial emission reductions
without undue inconvenience to California vehicle owners, and
vehicle owners will benefit from the maintenance by the state of a
substantially decentralized program giving them a choice among
thousands of independent licensed stations able to perform both
inspection and repair of vehicles.
   (b) With the enactment of this chapter, the Legislature does not
intend to create a statutory presumption that any motor vehicle,
solely by virtue of make, model, or year of manufacture, shall be
classified or categorized as a "gross polluter" or a "gross polluting
vehicle."
   (c)  (1)  With the enactment of this chapter, the
Legislature does not intend to place an unreasonable burden on fleet
vehicles with respect to compliance with smog inspection and
maintenance regulations.  
   (2) Fleet vehicles shall not be included in the certification
requirements established pursuant to Section 44014.7.   

  SEC. 2.  Section 44003 of the Health and Safety Code is repealed.
 
   44003.  (a) (1) An enhanced motor vehicle inspection and
maintenance program is established in each urbanized area of the
state, any part of which is classified by the Environmental
Protection Agency as a serious, severe, or extreme nonattainment area
for ozone or a moderate or serious nonattainment area for carbon
monoxide with a design value greater than 12.7 ppm, and in other
areas of the state as provided in this chapter.
   (2) The enhanced motor vehicle inspection and maintenance program
established pursuant to paragraph (1) shall be assessed jointly by
the department and the state board periodically to determine whether
changes in the program may be warranted.  On or before January 1,
2003, the department and the state board shall jointly issue a report
to the Legislature based on those periodic assessments, recommending
any modifications to the enhanced program to improve its operations
and lessen its impact on consumers while still achieving the
necessary emission reductions to attain air quality standards.
   (3) A basic vehicle inspection and maintenance program shall be
continued in all other areas of the state where a program was in
existence under this chapter as of the effective date of this
paragraph.
   (b) The department may prescribe different test procedures and
equipment requirements for those areas described in subdivision (a).
Program components shall be operated in all program areas unless
otherwise indicated, as determined by the department.  In those areas
where the biennial program is not implemented and smog check
inspections are required to complete the requirements set forth in
Sections 4000.1 and 4000.2 of the Vehicle Code, program elements that
apply in basic areas, including test equipment requirements for smog
check stations, shall apply.
   (c) (1) Districts classified as attainment areas may request the
department to implement all or part of the program elements defined
in this chapter.  However, the department shall not implement the
program established by Section 44010.5 in any area other than an
urbanized area, any part of which is classified by the Environmental
Protection Agency as a serious, severe, or extreme nonattainment area
for ozone or a moderate or serious nonattainment area for carbon
monoxide with a design value greater than 12.7 ppm.
   (2) Districts that include areas classified as basic program
nonattainment areas pursuant to subdivision (a) may, except as
provided in paragraph (1), request the implementation in those areas
of test procedures and equipment required for enhanced program areas
and any other program requirement specified for enhanced program
areas.   
  SEC. 3.  Section 44010.5 of the Health and Safety Code is repealed.
 
   44010.5.  (a) The department shall implement a program with the
capacity to commence, by January 1, 1995, the testing at test-only
facilities, in accordance with this chapter, of 15 percent of that
portion of the total state vehicle fleet consisting of vehicles
subject to inspection each year in the biennial program and that are
registered in the enhanced program area, as established pursuant to
paragraph (1) of subdivision (a) of Section 44003.
   (b) (1) The department shall increase the capacity of the program
so that the capacity exists to commence, by January 1, 1996, the
testing at test-only facilities of that portion of the state vehicle
fleet that is subject to inspection and is registered in the enhanced
program area, which is sufficient to meet the emission reduction
performance standards established by the Environmental Protection
Agency in regulations adopted pursuant to the Clean Air Act
Amendments of 1990, taking into account the results of the pilot
demonstration program established pursuant to Section 44081.6.
   (2) Upon increasing the capacity of the program pursuant to
paragraph (1), the department shall afford smog check stations that
are licensed and certified pursuant to Sections 44014 and 44014.2 the
initial opportunity to perform the required inspections.  The
department shall adopt, by regulation, the requirements to provide
that initial opportunity.
   (3) If the department determines that there is an insufficient
number of licensed test-only smog check stations operating in an
enhanced area to meet the increased demand for test-only inspections,
the department may increase the capacity of the program by utilizing
existing contracts.
   (c) The program shall utilize loaded mode dynamometer test
equipment, as determined through the pilot demonstration program.
   (d) Vehicles in the enhanced program area which are not subjected
to the program established by this section may be tested at smog
check stations licensed pursuant to Section 44014 that use loaded
mode dynamometers.
   (e) (1) The department may implement the program established
pursuant to subdivision (a) through a network of privately operated
test-only facilities established pursuant to contracts to be awarded
pursuant to this section.
   (2) The initial contracts awarded pursuant to this section shall
terminate not later than seven years from the date that the contracts
were executed.
   (f) No person shall be a contractor of the department for
test-only facilities in all air basins, exclusively, where the
enhanced program is in effect unless the department determines, after
a public hearing, that there is not more than one qualified
contractor.  The South Coast Air Basin shall have at least two
contractors, and the combined enhanced program area that includes
Bakersfield, Fresno, and Sacramento shall have at least two
contractors.  The department may operate test-only facilities on an
interim basis while contractors are being sought.
   (g) (1) In awarding contracts under this section, the department
shall request bids through the issuance of a request for proposal.
   (2) The department shall first determine which bidders are
qualified, and then award the contract to the qualified bidder,
giving priority to the test cost and convenience to motorists.
   (3) The department shall provide a contractual preference, as
determined by the department, not to exceed 10 percent of the total
proposal evaluation score, based on the following factors:
   (A) Up to 5 percent to bidders providing firm commitments to
employ businesses that are licensed or otherwise substantially
participating in the smog check program after January 1, 1994.
   (B) Up to 5 percent to bidders based on the extent to which
bidders maximize the potential economic benefit of the smog check
program on this state over the term of the contract.  That potential
economic benefit shall include the percentage of work performed by
California-based firms, the potential of the total project work force
who will be California residents, and the percentage of subcontracts
that will be awarded to California-based firms.
   (4) Any contract executed by the department for the operation of a
test-only facility shall expressly require compliance with this
chapter and any regulations adopted by the department pursuant to
this chapter.
   (h) The department shall ensure that there is a sufficient number
of test-only facilities, and that they are properly located, to
ensure reasonable accessibility and convenience to all persons within
an enhanced program area, and that the waiting time for consumers is
minimized.  The department may operate test-only facilities on an
interim basis to ensure convenience to consumers.  The department
shall specify in the request for proposal the minimum number of
test-only facilities that are required for the program.  Any
contracts initially awarded pursuant to this section shall ensure
that the contractors are capable of fulfilling the requirements of
subdivision (a).
   (i) Any data generated at a test-only facility shall be the
property of the state, and shall be fully accessible to the
department at any time.  The department may set contract
specifications for the storage of that data in a central data storage
system or facility designated by the department.
   (j) The department shall ensure an effective transition to the new
program by implementing an effective public education program and
may specify in the request for proposal a dollar amount that bidders
are required to include in their bids for public education
activities, to be implemented pursuant to Section 44070.5.
   (k) The department shall ensure the effective management of the
test-only facilities and shall specify in the request for proposal
that a manager be present during all hours of station operation.
   (l) The department shall ensure and facilitate the effective
transition of employees of businesses that are licensed or otherwise
substantially participating in the smog check program and may specify
in the request for proposal that test-only facility management be
Automotive Service Excellence (ASE) certified, or be certified by a
comparable program as determined by the department.
   (m) As part of the contracts to be awarded pursuant to subdivision
(e), the department may require contractors to perform functions
previously undertaken by referee stations throughout the state, as
determined by the department, at some or all of the affected stations
in enhanced areas, and at additional stations outside enhanced areas
only to the extent necessary to provide appropriate access to
referee functions.
   (n) Notwithstanding any other provision of law, to avoid delays to
the program implementation timeline required by this chapter or the
Clean Air Act, the Department of General Services, at the request of
the department, may exempt contracts awarded pursuant to this section
from existing laws, rules, resolutions, or procedures that are
otherwise applicable, including, but not limited to, restrictions on
awarding contracts for more than three years.  The department shall
identify any exemptions requested and granted pursuant to this
subdivision and report thereon to the Legislature.
   (o) This section shall not be implemented unless the memorandum of
agreement described in Section 44081.6 is signed by both the
California Environmental Protection Agency and the Environmental
Protection Agency.
   (p) The department shall implement the program established in this
section only in urbanized areas classified by the Environmental
Protection Agency as a serious, severe, or extreme nonattainment area
for ozone or a moderate or serious nonattainment area for carbon
monoxide with a design value greater than 12.7 ppm, and shall not
implement the program in any other area.
   (q) If existing smog check stations, in order to participate in
the enhanced program, have been required to make additional
investments of more than ten thousand dollars ($10,000), the
department shall submit recommendations to the Governor and the
Legislature for any appropriate mitigation measures.   
  SEC. 4.  Section 44011 of the Health and Safety Code is amended to
read: 
   44011.   (a)  All motor vehicles powered by
internal combustion engines that are registered within an area
designated for program coverage shall be required biennially to
obtain a certificate of compliance or noncompliance, except for all
of the following:  
   (1)  
   (a)   Every motorcycle, and every diesel-powered vehicle,
until the department, pursuant to Section 44012, implements test
procedures applicable to motorcycles or to diesel-powered vehicles,
or both.  
   (2)  
   (b)  Any motor vehicle that has been issued a certificate of
compliance or noncompliance or a repair cost waiver upon a change of
ownership or initial registration in this state during the preceding
six months.  
   (3) (A)  
   (c) (1)  Prior to January 1, 2003, any motor vehicle
manufactured prior to the 1974 model-year.  
   (B)  
   (2)  Beginning January 1, 2003, any motor vehicle that is 30
or more model-years old.  
   (4) (A)  
   (d) (1)  Any motor vehicle four or less model-years old.

   (B)  
   (2)  Any motor vehicle excepted by this  paragraph
  subdivision  shall be subject to testing and to
certification requirements as determined by the department, if any of
the following apply:  
   (i)  
   (A)  The department determines through remote sensing
activities or other means that there is a substantial probability
that the vehicle has a tampered emission control system or would fail
for other cause a smog check test as specified in Section 44012.

   (ii)  
   (B)  The vehicle was previously registered outside this state
and is undergoing initial registration in this state.  
   (iii)  
   (C)  The vehicle is being registered as a specially
constructed vehicle.  
   (iv)  
   (D)  The vehicle has been selected for testing pursuant to
 Section 44014.7 or  any  other 
provision of this chapter authorizing out-of-cycle testing.  

   (5)  
   (e)  Any motor vehicle or class of motor vehicles exempted
pursuant to subdivision (b) of Section 44024.5.  
   (6)  
   (f)  Any motor vehicle that the department determines would
present prohibitive inspection or repair problems.  
   (7)  
   (g)  Any vehicle registered to the owner of a fleet licensed
pursuant to Section 44020 if the vehicle is garaged exclusively
outside the area included in program coverage, and is not primarily
operated inside the area included in program coverage.  
   (b) Vehicles designated for program coverage in enhanced areas
shall be required to obtain inspections from appropriate smog check
stations operating in enhanced areas.   
  SEC. 5.  Section 44011.3 is added to the Health and Safety Code, to
read:
   44011.3.  Every motor vehicle that is subject to testing pursuant
to this chapter may be pretested.  As used in this section, a pretest
is a smog inspection in which the motor vehicle is submitted to some
or all of the required elements of the emissions inspection as
specified in Section 44012, the results of which will not be reported
to the Department of Motor Vehicles and for which a certificate will
not be issued.  A person choosing to have his or her vehicle
pretested has the right to have a complete pretest of the vehicle
unless the person requests a partial pretest.  If the person requests
a partial pretest, the licensed technician or an authorized
representative of the licensed smog check station shall inform the
vehicle owner that the partial pretest may not indicate the
likelihood of the vehicle passing a subsequent official inspection.
 
  SEC. 6.  Section 44012 of the Health and Safety Code is amended to
read: 
   44012.  The test at the smog check stations shall be performed in
accordance with procedures prescribed by the department, pursuant to
Section 44013, shall require , at a minimum, loaded mode
dynamometer testing in enhanced areas, and  two-speed
testing in all  other  program areas, and shall
ensure all of the following:
   (a) Emission control systems required by state and federal law are
reducing excess emissions in accordance with the standards adopted
pursuant to subdivisions (a) and (c) of Section 44013.
   (b) Motor vehicles are preconditioned to ensure representative and
stabilized operation of the vehicle's emission control system.
   (c) For other than diesel-powered vehicles, the vehicle's exhaust
emissions of hydrocarbons, carbon monoxide, carbon dioxide, and
oxides of nitrogen in an idle mode or loaded mode are tested in
accordance with procedures prescribed by the department.  In
determining how loaded mode and evaporative emissions testing shall
be conducted, the department shall ensure that the emission reduction
targets for the enhanced program are met. 
   (d) For other than diesel-powered vehicles, the vehicle's fuel
evaporative system and crankcase ventilation system are tested to
reduce any nonexhaust sources of volatile organic compound emissions,
in accordance with procedures prescribed by the department.
   (e) For diesel-powered vehicles, if the department determines that
the inclusion of those vehicles is technologically and economically
feasible, a visual inspection is made of emission control devices and
the vehicle's exhaust emissions in an idle mode  or loaded
mode  are tested in accordance with procedures prescribed by
the department.  The test may include testing of emissions of any or
all of the pollutants specified in subdivision (c) and, upon the
adoption of applicable standards, measurement of emissions of smoke
or particulates, or both.
   (f) A visual or functional check is made of emission control
devices specified by the department, including the catalytic
converter in those instances in which the department determines it to
be necessary to meet the findings of Section 44001.  The visual or
functional check shall be performed in accordance with procedures
prescribed by the department.
   (g) A determination as to whether the motor vehicle complies with
the emission standards for that vehicle's class and model-year as
prescribed by the department.
   (h) The test procedures may authorize smog check stations to
refuse the testing of a vehicle that would be unsafe to test, or that
cannot physically be inspected, as specified by the department by
regulation.  The refusal to test a vehicle for those reasons shall
not excuse or exempt the vehicle from compliance with all applicable
requirements of this chapter.   
  SEC. 7.  Section 44013.5 of the Health and Safety Code is amended
to read: 
   44013.5.  (a) If the department, in consultation with the state
board, determines that substantial demand for emission retrofit
devices exists, the department shall develop a program for the
certification of emissions retrofit device installations by licensed
installers.  The department may require installers of emissions
retrofit devices to be qualified pursuant to this chapter.  The
department may assess biennial license fees upon those installers in
an amount not to exceed the reasonable cost of administering the
emissions retrofit device certification program.
   (b) The certification shall be performed at a referee  or
test-only  station and shall be based on a visual inspection
of the emissions retrofit device and its installation, and
verification of the proper operation of any new or modified
components that are a part of the emissions retrofit device, and not
on the results of an emissions test.
   (c) The department shall develop a program for the identification
of retrofitted vehicles at smog check stations and for providing
information required for the inspection of those systems to smog
check stations.
   (d) This section shall become inoperative pursuant to Section 33
of the act adding this section or, in any case, five years from the
date determined pursuant to Section 32 of the act adding this
section, and on the January 1 following the date upon which this
section becomes inoperative, is repealed.   
  SEC. 8.  Section 44014 of the Health and Safety Code is amended to
read: 
   44014.  (a) Except as otherwise provided in this chapter, the
testing and repair portion of the program shall be conducted by smog
check stations licensed by the department, and by smog check
technicians who have qualified pursuant to this chapter.
   (b)  (1) A smog check station may be licensed by the
department as a smog check test-only station and, when so licensed,
need not comply with the requirement for onsite availability of
current service and adjustment procedures specified in paragraph (3)
of subdivision (b) of Section 44030.  A smog check technician
employed by a smog check test-only station shall be qualified in
accordance with this section.
   (2)  The department may authorize the placement of
referees in qualified  test-only   smog check
 stations to provide referee services as a matter of convenience
to the public.  The department shall supply those referees directly
or through a contractor.  A referee shall have no ownership interest
in the facility at which the referee is located.  Referees shall be
solely responsible for issuing repair cost waivers, certificates of
compliance or noncompliance, and hardship extensions, in accordance
with regulations adopted by the department.
   The department may adopt regulations to establish qualification
standards and any special administrative, operational, and licensure
standards that the department determines to be necessary for 
test-only   smog check  stations that perform
referee services.
   (c) A smog check station may also be licensed as a repair-only
station, and if so licensed, may perform repairs to reduce excessive
emissions on vehicles  which   that  have
failed the smog check test.  Repair procedures and equipment
requirements shall be established by the department.  Technicians
employed by a smog check repair-only station shall be qualified in
accordance with this section.
   (d) Smog check technicians are qualified to test and repair only
those classes and categories of vehicles for which they have passed a
qualification test administered by the department.  The department
shall provide for smog check technicians to be qualified for
different categories of motor vehicle inspection based on vehicle
classification and model-year.
   (e) The consumer protection-oriented quality assurance portion of
the program may be conducted by one or more private entities pursuant
to contracts with the department.   
  SEC. 9.  Section 44014.2 of the Health and Safety Code is repealed.
 
   44014.2.  The department shall develop a program for the voluntary
certification of licensed smog check stations, or the department may
accept a smog check station certification program proposed by
accredited industry representatives.  Such a certification program,
which may be called a "gold shield" program, shall be for the purpose
of providing consumers, whose vehicles fail an emissions test at a
test-only facility, an option of services at a single location to
prevent the necessity for additional trips back to the test-only
facility for vehicle certification.   
  SEC. 10.  Section 44014.4 of the Health and Safety Code is
repealed.  
   44014.4.  (a) A licensed smog check station that has been
certified pursuant to Section 44014.2 may advertise that fact, and
the advertisement may include the scope of work established by the
program.
   (b) It is an unfair business practice and a violation of Section
17500 of the Business and Professions Code for any licensed smog
check station that is not so certified to advertise as having
obtained certification or as complying with the scope of work, code
of ethics, or certification standards established by the
certification program.   
  SEC. 11.  Section 44014.5 of the Health and Safety Code is
repealed.  
   44014.5.  (a) The enhanced program shall provide for the testing
and retesting of vehicles in accordance with Sections 44010.5 and
44014.2 and this section.
   (b) The repair of vehicles at test-only facilities shall be
prohibited, except that the minor repair of components damaged by
station personnel during inspection at the station, any minor repair
that is necessary for the safe operation of a vehicle while at a
station, or other minor repairs,
     such as the reconnection of hoses or vacuum lines, may be
undertaken at no charge to the vehicle owner or operator if
authorized in advance in writing by the department.
   (c) The department shall provide for the distribution to consumers
by test-only facilities of a list, compiled by region, of smog check
stations licensed to make repairs of vehicular emission control
systems.  A test-only facility shall not refer a vehicle owner to any
particular provider of vehicle repair services.
   (d) The department shall establish standards for training,
equipment, performance, or data collection for test-only facilities.

   (e) The department shall prohibit test-only facilities from
engaging in other business activities that represent a conflict of
interest, as determined by the department.
   (f) The test-only facility may charge a fee, established by the
department, sufficient to cover the facility's cost to perform the
tests or services, including, but not limited to, referee services
and the issuance of waivers and hardship extensions required by this
chapter.  In addition, the station shall charge and collect the
certificate fee established pursuant to Section 44060.  This
subdivision shall apply only to facilities contracted for pursuant to
subdivision (e) of Section 44010.5.
   (g) The department shall ensure that there is a sufficient number
of test-only facilities to provide convenient testing for the
following vehicles:
   (1) All vehicles identified and confirmed as gross polluters
pursuant to Section 44081 and Section 27156 of the Vehicle Code.
   (2) (A) Vehicles initially identified as gross polluters by a smog
check station licensed as a test-and-repair station and certified
pursuant to Section 44014.2 may be issued a certificate of compliance
by a test-only facility or by the licensed smog check station
certified pursuant to Section 44014.2 at which they were initially
identified as a gross polluter.
   (B) For purposes of this section, the department may conduct a
pilot program to allow vehicles initially identified as gross
polluters to be repaired and issued a certificate of compliance by a
facility licensed and certified pursuant to Section 44014.2.  For the
purposes of this pilot program, the department may adopt regulations
imposing additional station requirements.
   (3) All vehicles designated by the department pursuant to Sections
44014.7 and 44020.
   (4) Vehicles issued an economic hardship extension in the previous
biennial inspection of the vehicle.
   (h) The department shall provide a sufficient number of test-only
facilities authorized to perform referee functions to provide
convenient testing for those vehicles that are required to report to,
and receive a certificate of compliance from, a test-only facility
by this chapter, including all of the following:
   (1) All vehicles seeking to utilize state-operated financial
assistance or inclusion in authorized scrap programs.
   (2) All vehicles unable to obtain a certificate of compliance from
a licensed smog check station pursuant to subdivision (c) of Section
44015.
   (3) Any other vehicles that may be designated by the department.
   (i) Gross polluters shall be referred to a test-only facility, or
a test-and-repair station that is both licensed and certified
pursuant to Sections 44014 and 44014.2 and is participating in the
pilot program pursuant to subparagraph (B) of paragraph (2) of
subdivision (g), for a postrepair inspection and retest pursuant to
subdivision (g).  Simply passing the emissions test shall not be a
sufficient condition for receiving a certificate of compliance.  A
certificate of compliance shall only be issued to a vehicle that does
not have any defects with its emission control system or any defects
that could lead to damage of its emission control system, as
provided in regulations adopted by the department.   
  SEC. 12.  Section 44014.7 of the Health and Safety Code is
repealed.  
   44014.7.  (a) The department shall require 2 percent of the
vehicles required to obtain a certificate of compliance each year in
enhanced program areas to receive their certificate from a test-only
facility.
   (b) The department may require a number not to exceed 2 percent of
the vehicles required to obtain a certificate of compliance each
year in basic program areas to receive their certificate from a
test-only facility.
   (c) The vehicles specified in subdivisions (a) and (b) shall be
selected at random.  The vehicles may be included among the vehicles
subject to subdivision (d) of Section 44010.5, to the extent that the
vehicles are registered in enhanced program areas.  The review
committee may review the selection process to ensure that it is a
statistically significant representation of the vehicles subject to
the basic and enhanced programs.  The department shall select the
vehicles and the Department of Motor Vehicles shall notify the owners
of their obligation under this section pursuant to Section 4000.3 of
the Vehicle Code.  Selection shall be made from vehicles in an area
where a test-only facility is located.   
  SEC. 13.  Section 44015 of the Health and Safety Code, as amended
by Chapter 92 of the Statutes of 1998, is amended to read: 
   44015.  (a) A licensed smog check station shall not issue a
certificate of compliance, except as authorized by this chapter, to
any vehicle that meets the following criteria:
   (1) A vehicle that has been tampered with.
   (2) A vehicle that, prior to repairs, has been initially
identified by the smog check station as a gross polluter.  
Certification of a gross polluting vehicle shall be conducted by a
designated test-only facility, or a test-and-repair station that is
both licensed and certified pursuant to Section 44014 and 44014.2 and
is participating in the pilot program pursuant to subparagraph (B)
of paragraph (2) of subdivision (g) of Section 44014.5. 
   (3) A vehicle described in subdivision (c).
   (b) If a vehicle meets the requirements of Section 44012, a smog
check station licensed to issue certificates shall issue a
certificate of compliance or a certificate of noncompliance.
   (c) (1) A repair cost waiver shall be issued, upon request of the
vehicle owner, by an entity authorized to perform referee functions
for a vehicle that has been properly tested but does not meet the
applicable emission standards when it is determined that no
adjustment or repair can be made that will reduce emissions from the
inspected motor vehicle without exceeding the applicable repair cost
limit established under Section 44017 and that every defect specified
by paragraph (2) of subdivision (a) of Section 43204, and by
paragraphs (2) and (3) of subdivision (a) of Section 43205, has been
corrected.  A repair cost waiver issued pursuant to this paragraph
shall be accepted in lieu of a certificate of compliance for the
purposes of compliance with Section 4000.3 of the Vehicle Code.  No
repair cost waiver shall exceed two years' duration.  No repair cost
waiver shall be issued until the vehicle owner has expended an amount
equal to the applicable repair cost limit specified in Section
44017.
   (2) An economic hardship extension shall be issued, upon request
of a qualified low-income motor vehicle owner, by an entity
authorized to perform referee functions, for a motor vehicle that has
been properly tested but does not meet the applicable emission
standards when it is determined that no adjustment or repair can be
made that will reduce emissions from the inspected motor vehicle
without exceeding the applicable repair cost limit, as established
pursuant to Section 44017.1, that every defect specified in paragraph
(2) of subdivision (a) of Section 43204, and in paragraphs (2) and
(3) of subdivision (a) of Section 43205, has been corrected, that the
low-income vehicle owner would suffer an economic hardship if the
extension is not issued, and that all appropriate emissions-related
repairs up to the amount of the applicable repair cost limit in
Section 44017.1 have been performed.
   (d) No repair cost waiver or economic hardship extension shall be
issued under any of the following circumstances:
   (1) If a motor vehicle was issued a repair cost waiver or economic
hardship extension in the previous biennial inspection of that
vehicle.  A repair cost waiver or economic hardship extension may be
issued to a motor vehicle owner only once for a particular motor
vehicle belonging to that owner.  However, a repair cost waiver or
economic hardship extension may be issued for a motor vehicle that
participated in a previous waiver or extension program prior to
January 1, 1998, as determined by the department.  For waivers or
extensions issued in the program operative on or after January 1,
1998, a waiver or extension may be issued for a motor vehicle only
once per owner.
   (2) Upon initial registration of all of the following:  a direct
import motor vehicle, a motor vehicle previously registered outside
this state, a dismantled motor vehicle pursuant to Section 11519 of
the Vehicle Code, a motor vehicle that has had an engine change, an
alternate fuel vehicle, and a specially constructed vehicle.
   (e) Unless the certificate is issued to a licensed automobile
dealer, a certificate of compliance or noncompliance shall be valid
for 90 days.  If the certificate is issued to a licensed automobile
dealer,  the certificate shall be valid for 180 days.
   (f) A test may be made at any time within 90 days prior to the
date otherwise required.   
  SEC. 14.  Section 44017 of the Health and Safety Code is amended to
read: 
   44017.  (a)  Except as otherwise provided in this section
or Section 44017.1, a   A  motor vehicle owner
shall qualify for a repair cost waiver only after expenditure of
 not less than four hundred fifty dollars ($450) 
 an amount  for repairs, including parts and labor 
.   as follows:  
   (b) The limit established pursuant to subdivision (a) shall not
become operative until the department issues a public notice
declaring that the program established pursuant to Section 44010.5 is
operational in the relevant geographical areas of the state, or
until the date that testing in those geographic areas is operative
using loaded mode test equipment, as defined in this article,
whichever occurs first.  Prior to that time, the following cost
limits shall remain in effect: 
   (1) For motor vehicles of 1971 and earlier model years, fifty
dollars ($50).
   (2) For motor vehicles of 1972 to 1974, inclusive, model years,
ninety dollars ($90).
   (3) For motor vehicles of 1975 to 1979, inclusive, model years,
one hundred twenty-five dollars ($125).
   (4) For motor vehicles of 1980 to 1989, inclusive, model years,
one hundred seventy-five dollars ($175).
   (5) For motor vehicles of 1990 to 1995, inclusive, model years,
three hundred dollars ($300).
   (6) For motor vehicles of 1996 and later model years, four hundred
fifty dollars ($450).  
   (c)  
   (b)  The department shall periodically revise the repair cost
limits specified in  subdivisions   subdivision
 (a)  and (b)  in accordance with changes in
the Consumer Price Index, as published by the United States Bureau of
Labor Statistics. 
   (d)  
   (c)  No repair cost limit shall be imposed in those cases
where emissions control equipment is missing or is partially or
totally inoperative as a result of being tampered with.   
  SEC. 15.  Section 44020 of the Health and Safety Code is amended to
read: 
   44020.  Notwithstanding any other provision of this chapter, the
department may license any registered owner of a fleet of 10 or more
motor vehicles subject to this chapter, who so elects, to implement
and conduct the tests and to perform necessary service and adjustment
on the fleet's vehicles under this chapter, subject to all of the
following conditions:
   (a) The registered owner's facilities or personnel, or both, or a
designated contractor of the registered owner, shall be licensed by
the department as a fleet smog check station, and the test and repair
system shall conform, in the department's determination, with all
provisions of this chapter and all rules and regulations adopted by
the department.  The regulations shall provide for adequate onsite
inspection by the department.  Mobile testing equipment certified by
the department may be used in accordance with procedures established
by the department.  The department may prohibit the use of mobile
testing equipment if violations occur.
   (b) A license issued under this section is subject to Sections
44035, 44050, and 44072.10, and may be suspended or revoked by the
department whenever the department determines, on the basis of random
periodic spot checks of the owner's inspection system and fleet
vehicles, that the system fails to conform or that certificates of
compliance have been issued by the owner in violation of regulations
adopted by the department.  Any person licensed to conduct tests and
service and adjustments under this section is deemed to have
consented to provide the department with whatever access,
information, and other cooperation the department reasonably
determines are necessary to facilitate the random periodic spot
checks.
   (c) The department or its contractor, on a random periodic basis,
shall inspect or observe the inspections performed by licensed fleet
smog check stations on not less than 2 percent of the total business
fleet vehicles subject to this chapter.
   (d) A fleet owner licensed to conduct tests or make repairs
pursuant to this chapter shall issue certificates of compliance for
motor vehicles.  The cost limits in Section 44017 and the economic
hardship extension provisions in this chapter shall not apply to any
motor vehicle owned by a fleet owner licensed pursuant to this
section.
   (e) Notwithstanding subdivision (d), certificates of compliance or
noncompliance prepared solely for the disposal or sale of motor
vehicles owned by a fleet owner licensed pursuant to this section
shall be subject to the cost limits in Section 44017.
   (f) The department shall establish initial and renewal license
fees, which shall not exceed the reasonable costs of administering
this section.
   (g)  Notwithstanding any other provision of this section,
fleets consisting of vehicles for hire or vehicles which accumulate
high mileage, as defined by the department, shall go to a test-only
station when a smog check certificate of compliance is required.
Initially, high mileage vehicles shall be defined as vehicles which
accumulate 50,000 miles or more each year.  In addition, fleets which
do not operate high mileage vehicles may be required to obtain
certificates of compliance from the test-only station if they fail to
comply with this chapter.
   (h)  Notwithstanding any other provision of this chapter,
the department shall have the authority, by regulation, to require
testing of vehicle fleets consistent with regulations adopted by the
Environmental Protection Agency, if necessary to meet the emission
reduction performance standard established by the agency, as
determined by the department.   
  SEC. 16.  Section 44021 of the Health and Safety Code is amended to
read: 
   44021.  (a) (1) The Inspection and Maintenance Review Committee is
hereby created to analyze the effect of the improved inspection and
maintenance program established by this chapter on motor vehicle
emissions and air quality.  The functions of the review committee
shall be advisory in nature and primarily pertain to the gathering,
analysis, and evaluation of information.
   (2) The members of the review committee shall receive no
compensation, but shall be reimbursed by the department for their
reasonable expenses in performing committee duties.  The state board
and the department shall provide the review committee with any
necessary technical and clerical support in its evaluation and study.

   (3) (A) The review committee shall consist of 13 members, nine to
be appointed by the Governor, two by the Senate Committee on Rules,
and two by the Speaker of the Assembly.  All members shall be
appointed to four-year terms, and the Governor shall appoint from
among his or her appointees the chairperson of the review committee.

   (B) The appointees of the Governor shall include an air pollution
control officer from  an enhanced   a 
program nonattainment area, three public members, an expert in air
quality, an economist, a social scientist, a representative of the
inspection and maintenance industry, and a representative of
stationary source emissions organizations.
   (C) The appointees of the Senate Committee on Rules shall include
an environmental member with expertise in air quality, and a
representative from the inspection and maintenance industry.
   (D) The appointees of the Speaker of the Assembly shall include an
environmental member with expertise in air quality, and a
representative of a local law enforcement agency charged with
prosecuting violations of this chapter in  an enhanced
  a  program nonattainment area.
   (4) In preparing its evaluations of program effectiveness as
provided in paragraph (1), the review committee shall consult with
the Department of the California Highway Patrol, the Department of
Motor Vehicles, and any other appropriate agencies, as well as the
department and the state board, shall schedule and conduct periodic
meetings in the performance of its duties, and shall meet and consult
with local, state, and federal officials involved in the evaluation
of motor vehicle inspection and maintenance programs.  At the request
of the committee, the department or the state board may, on behalf
of the committee, contract with independent entities to assist in the
committee's evaluations.
   (b) The review committee shall submit periodic written reports to
the Legislature and the Governor on the performance of the program
and make recommendations on program improvements at least every 12
months.  The review committee's reports shall quantify the reduction
in emissions and improvement in air quality attributed to the
program.  Any reports, other than those required by this section,
that the review committee is required to provide pursuant to this
chapter shall also be transmitted to the Secretary for Environmental
Protection and the Secretary for State and Consumer Services.
   (c) The review committee shall work closely with all interested
parties in preparing the information required by subdivisions (a) and
(b) and shall consider the reports provided pursuant to subdivision
(e).  The review committee shall hold at least one public hearing on
its findings and recommendations prior to submitting its reports.
The reports shall include statutory language to implement its
recommendations, and shall recommend the timeframe for making any
changes to the program.  The review committee shall seek comments
from the department, the Department of Motor Vehicles, the Department
of the California Highway Patrol, and the state board prior to
submitting its reports, and those comments shall be published as an
appendix to the report.
   (d) The review committee shall participate in the demonstration
program authorized by Section 44081.6, as provided by that section.
   (e) The state board, in cooperation with the department, shall
periodically submit reports to the review committee.  The reports
shall include an assessment of the impact on emissions of continuing
the exemption from inspection of motor vehicles newer than five years
old; a comparison of the actual mass emission reductions 
being achieved by the enhanced program to those required by
the State Implementation Plan; and recommendations to improve the
effectiveness and cost-effectiveness of the program, including
specific recommendations addressing any discrepancy between emissions
achieved and those in the State Implementation Plan.  The first
report shall be submitted not later than January 1, 2000, and reports
shall be submitted triennially thereafter.  In preparing the
reports, the state board shall use data collected during inspections
and repair, and data collected using roadside measurements, and may
conduct additional testing, as determined to be necessary, to
accurately quantify the mass emissions reduced.   
  SEC. 17.  Section 44024.5 of the Health and Safety Code is amended
to read: 
   44024.5.  (a) The department shall compile and maintain
statistical and emissions profiles of motor vehicles that are subject
to the motor vehicle inspection program.  The department may use
data from any source, including remote sensing data and other motor
vehicle inspection program data, to develop and confirm the validity
of the profiles.
   (b) The department, in cooperation with the state board, shall
perform periodic analyses of the statistical and emissions profiles
created pursuant to subdivision (a).  The department and the state
board, in consultation with the Inspection and Maintenance Review
Committee, may determine that, in addition to the vehicles excepted
pursuant to Section 44011, certain other motor vehicles may be
excepted from the biennial certification requirements of this chapter
without significantly compromising the emission reduction objectives
set forth in the State Implementation Plan (SIP).
   (c) The department may conduct a pilot program to except from the
biennial certification requirement those vehicles that may be jointly
determined by the department and the state board, after consultation
with the Inspection and Maintenance Review Committee, to warrant
exception.  The department shall provide written notification to the
Legislature specifying the number of vehicles to be exempted as well
as the geographic location and duration of the pilot program not less
than 30 days prior to the implementation of the pilot program.  The
department shall submit the results of the pilot program to the state
board and the Inspection and Maintenance Review Committee for
review.  Subject to the approval of the Environmental Protection
Agency as an amendment to the SIP, the department may establish the
exception program as a permanent program.
   (d) For vehicles four model years old or less, the department
shall  use test data generated pursuant to Section 44014.7 to
 develop statistical and emissions profiles.  The
department may use data from any source, including remote sensing
data, warranty repair and recall data, and other motor vehicle
inspection program data, to develop and confirm the validity of the
data.  If the department and state board jointly determine that the
emissions from a class of motor vehicles would potentially compromise
the emission reduction objectives set forth in the SIP, the state
board shall consider appropriate corrective action, including, but
not limited to, recall pursuant to Section 43105.   
  SEC. 18.  Section 44033 of the Health and Safety Code is amended to
read: 
   44033.  (a)  (1)  Any facility meeting the
requirements established by the department pursuant to this chapter
may be licensed as a  test-only,  test and repair
 ,  or repair-only smog check station.  A licensed
smog check station shall display an identifying sign prescribed by
the department in a manner conspicuous to the public.  
   (2) A licensed smog check station certified pursuant to Section
44014.2 shall display an identifying sign prescribed by the
department. 
   (b) No licensed or certified smog check station shall require, as
a condition of performing the test, that any needed repairs or
adjustment be done by the person, or at the facility of the person,
performing the test.
   (c) If a motor vehicle, including a commercial vehicle, is tested
at a facility licensed to perform tests and repairs pursuant to this
chapter, the facility shall provide the customer with a written
estimate pursuant to Section 9884.9 of the Business and Professions
Code.  The written estimate shall contain a notice to the customer
stating that the customer may choose another smog check station to
perform needed repairs, installations, adjustments, or subsequent
tests.
   (d) Charges for testing or repair, or both, shall be separately
stated.
   (e) The department shall require the posting of station licenses
and qualified technicians' certificates prominently in each place of
business so as to be readily visible to the public.   
  SEC. 19.  Section 44036 of the Health and Safety Code is amended to
read: 
   44036.  (a) The consumer protection-oriented quality assurance
portion of the motor vehicle inspection program shall ensure uniform
and consistent tests and repairs by all qualified smog check
technicians and licensed smog check stations throughout the  state,
and shall include a number of stations providing referee functions
available to consumers.
   (b) All licensed smog check stations shall utilize original
equipment and replacement parts that are certified by the department.
  The department shall charge a fee for certification testing of the
equipment or the replacement parts.  The fee for certification
testing of equipment shall be fixed by the department based upon its
actual costs of certification testing, shall be calculated from the
time that the equipment is submitted for certification testing until
the time that the certification testing is complete, and shall not
exceed ten thousand dollars ($10,000).  The fee for certification
testing of replacement parts shall be determined by the department
based upon its actual costs of certification testing, shall be
calculated from the time that the replacement part is submitted for
certification testing until the time that the certification testing
is complete,                                              and shall
not exceed two thousand five hundred dollars ($2,500).  The
department shall adopt, and may revise, standards for certification
and decertification of the equipment, which may include a device for
testing of emissions of oxides of nitrogen.  As expeditiously as
possible, the department shall adopt equipment standards that include
a test analyzer system containing all of the following:
   (1) A microprocessor to control test sequencing, selection of
proper test standards, the automatic pass or fail decision, and the
format for the test report and the recorded data file.  The
microprocessor shall be capable of using a standardized programming
language specified by the department.
   (2) An exhaust gas analysis portion with an analyzer for
hydrocarbons, carbon monoxide, and carbon dioxide that is designed to
accommodate an optional oxides of nitrogen analyzer.   An
oxides of nitrogen analyzer shall be required in the enhanced program
areas. 
   (3) Equipment necessary to perform visual and functional tests of
emission control devices required by the department.
   (4) A device to accept and record motor vehicle identification
information, including a device capable of reading bar code
information pursuant to regulations of the state board.  The device
shall have the ability to identify, with the cooperation of the
Department of Motor Vehicles, smog inspections performed on vehicles
sold by used car dealers.
   (5) A device to provide a printed record of the test process and
diagnostic information for the motorist.
   (6) A mass storage device capable of storing not less than the
minimum amount of program software and data specified by the
department.
   (7) A device to provide for the periodic modification of all
program and data files contained on the mass storage device, using a
standardized form of removable media conforming to specifications of
the department.
   (8) A device that provides for the storage of test records on a
standardized form of removable media conforming to specifications of
the department.
   (9) One or more communications ports conforming to the
specifications established by the department as necessary to provide
real time communication, or communication that is consistent with
maintaining a superior quality assurance program and efficient
information transfer, between the test equipment and the centralized
computer data base through the computer network maintained by the
department pursuant to Section 44037.1.
   (10) An interface capable of monitoring equipment used with loaded
mode testing, idle testing, on board diagnostic testing, or other
tests prescribed by the department.
   (11) Any other features that the department determines are
necessary to increase the effectiveness of the program, including,
but not limited to, a loaded mode dynamometer for purposes of oxides
of nitrogen detection, and other equipment necessary to detect
nonexhaust-related volatile organic compound emissions, such as found
in fuel system evaporative emissions and crankcase ventilation
emissions.
   (c) The department shall require all smog check stations to use
equipment meeting the requirements of subdivision (b) as soon as
possible, but not later than January 1, 1996.  However, the
department may defer the requirement for any equipment, external to
the chassis of the test analyzer system, needed to read bar code
information, until a substantial portion of the vehicles subject to
this chapter are equipped with bar code labels.  Prior to the
imposition of a requirement for equipment meeting the requirements of
subdivision (b), every smog check station shall use equipment
meeting the specifications of the department in effect on January 1,
1988.
   (d) The quality assurance portion shall provide for inspections of
licensed smog check stations, data collection and forwarding,
equipment accuracy checks, operation of referee stations, and other
necessary functions.  If the services are contracted for pursuant to
subdivision (e) of Section 44014, the department shall prepare
detailed specifications and solicit bids from private entities for
the implementation of the quality assurance functions.
   (e) The department may revise the specifications for equipment
annually if the cost thereof is less than 20 percent of the total
system cost.  A more comprehensive revision to the specifications may
be required not more often than every five years.
   (f) (1) Equipment manufacturers shall furnish to the department,
and shall install, software updates as  specified by the department.
The department shall allow equipment manufacturers six months, from
the date the department issues its proposed specifications for
periodic software updates, to obtain department approval that the
updates meet the proposed specifications and to install the updates
in all equipment subject to the updates.  During the first 30 days of
the six-month period, the manufacturers shall be permitted to review
and to comment upon the proposed specifications.  However,
notwithstanding any other provision of this section, the department
may order manufacturers to install software changes in a shorter
period of time upon a finding by the department that a previously
installed update does not meet current specifications.  A
manufacturer's failure to furnish or install software updates as so
specified is cause for the department to decertify the manufacturer's
test analyzer system or to issue a citation to the manufacturer.
The citation shall specify the nature of the violation and may
specify a civil penalty not to exceed one thousand dollars ($1,000)
for each day the manufacturer fails to furnish or install the
specified software updates by the specified period.  In assessing a
civil penalty pursuant to this subdivision, the department shall give
due consideration, in determining the appropriateness of the amount
of the civil penalty, to factors such as the gravity of the
violation, the good faith of the manufacturer, and the history of
previous violations.
   (2) The citations shall be served pursuant to subdivision (c) of
Section 11505 of the Government Code.  The manufacturer may request a
hearing in accordance with Chapter 5 (commencing with Section 11500)
of Part 1 of Division 3 of Title 2 of the Government Code.  A
request for a hearing shall be submitted in writing within 30 days of
service of the citation, and shall be delivered to the office of the
department in Sacramento.  Hearings and related procedures under
this subdivision shall be conducted in the same manner as proceedings
for adjudication of an accusation under  that 
Chapter 5  (commencing with Section 11500) of Part 1 of Division
3 of Title 2 of the Government Code  , except as otherwise
specified in this article.
   (3) If within 30 days from the date of service of the citation,
the manufacturer fails to request a hearing, the citation shall be
deemed the final order of the department.
   (4) Any failure to comply with the final order of the department
for payment of a civil penalty, or to pay the amount specified in any
settlement executed by the licensee and the Director of Consumer
Affairs, is cause for decertification of the manufacturer's test
analyzer system.   
  SEC. 20.  Section 44045.5 of the Health and Safety Code is amended
to read: 
   44045.5.  (a) This section describes the qualifications to be met
by smog check technician applicants effective January 1, 1995.  The
department shall, by regulation, establish requirements for the
licensure of smog check technicians  which  
that  are necessary to enable the program to meet the applicable
emission reduction performance standards, to include, at a minimum:

   (1) Either of the following:
   (A) Certification standards for all technicians in the program
 which   that  are equivalent or superior
to the standards applicable for certification by an established
national certification or accrediting institution to perform service
on automotive engines and electrical systems.
   (B) Successful completion of a training program certified by the
department under Section 44045.6.
   (2) In addition to the requirement in paragraph (1), a minimum of
two years' experience performing repairs to motor vehicle emission
control systems or experience approved by the department, or an
associate degree in an automotive technology curriculum or an
equivalent degree as determined by the department.
   (3) An examination process that effectively determines whether
applicants are all of the following:
   (A) Knowledgeable regarding the visual, functional, and exhaust
and evaporative emissions inspection and testing procedures specified
by the department, including a demonstrated understanding of loaded
mode testing principles, purpose, procedures and equipment.
   (B) Knowledgeable regarding misfire detection, air injection
testing, closed-loop system testing, and generic idle adjustment
procedures specified by the department.  
   (C) Capable of using emissions manuals and tuneup labels to
properly identify required emission control systems and components on
any vehicle subject to the enhanced program. 
   (4)  Not later than July 1, 1995, the   The
 examination shall use state-of-the-art technology, which may
include computer simulations or other computer-based examination
formats to determine whether applicants can properly identify,
diagnose, and repair emission-related problems.  The department may
contract for the development and administration of this examination.

   (b) The department shall not license any technician unless the
department has determined that the person is able to perform the
inspection, testing, and repair tasks required under the program on
all vehicles subject to the program, except that the department may
limit this requirement to specified makes or models of vehicles if a
technician requests licensing limited to specified makes or models of
vehicles.
   (c) The department may establish more than one category or level
of licensure, and may provide for the licensing of interns or
trainees if those persons do all of their test and repair work under
the supervision of a licensed technician.
   (d) The department shall require the renewal of smog check
technician licenses every two years, and shall establish any
necessary and appropriate requirements for renewal.   
  SEC. 21.  Section 44050 of the Health and Safety Code is amended to
read: 
   44050.  (a) If, upon investigation, the department has probable
cause to believe that a licensed smog check station,  a
test-only station contractor,  or a fleet owner licensed
under Section 44020 has violated this chapter, or any regulation
adopted pursuant to this chapter, the department may issue a citation
to the licensee  , contractor,  or fleet owner.
The citation shall specify the nature of the violation and may
specify a civil penalty assessed by the department pursuant to
Section 44051 or 44051.5.
   (b) If, upon investigation, the department has probable cause to
believe that a qualified smog check technician has violated Section
44012, 44015, 44016, or 44032, or any regulation of the department
adopted pursuant to this chapter, the department may issue a citation
to the technician.  The citation shall specify the nature of the
violation and, in addition, whichever of the following applies:
   (1) For a first citation, the smog check technician shall
successfully complete one or more retraining courses prescribed by
the department pursuant to subdivision (c) of Section 44031.5.
   (2) For a second citation, the smog check technician shall
successfully complete one or more retraining courses prescribed by
the department pursuant to subdivision (c) of Section 44031.5 and the
technician shall perform inspections or repairs pursuant to this
chapter under the direction of a technician in good standing, as
defined by the department.
   (3) For a third citation, the smog check technician shall
successfully complete an advanced retraining course prescribed by the
department and shall perform no inspection or repair pursuant to
this chapter until that completion.
   (4) For a fourth citation, the smog check technician's
qualification may be permanently revoked.
   (c) The citation shall be served pursuant to subdivision (c) of
Section 11505 of the Government Code.   
  SEC. 22.  Section 44056 of the Health and Safety Code is amended to
read: 
   44056.  (a) Except as otherwise provided in Sections 44051 and
44051.5, any person who violates this chapter, or any order, rule, or
regulation of the department adopted pursuant to this chapter, is
liable for a civil penalty of not less than one hundred fifty dollars
($150) and not more than two thousand five hundred dollars ($2,500)
for each day in which each violation occurs.  Any action to recover
civil penalties shall be brought by the Attorney General in the name
of the state on behalf of the department, or may be brought by any
district attorney, city attorney, or attorney for a district.
   (b) The penalties specified in subdivision (a) do not apply to an
owner or operator of a motor vehicle, except an owner or operator who
does any of the following:
   (1) Obtains, or who attempts to obtain, a certificate of
compliance, noncompliance or a repair cost waiver, or an economic
hardship extension without complying with Section 44015.
   (2) Obtains, or attempts to obtain, a certificate of compliance, a
repair cost waiver, or economic hardship extension by means of
fraud, including, but not limited to, offering or giving any form of
financial or other inducement to any person for the purpose of
obtaining a certificate of compliance for a vehicle that has not been
tested or has been tested improperly.
   (3) Registers a motor vehicle at an address other than the owner's
or operator's residence address for the purpose of avoiding the
requirements of this chapter.
   (4) Obtains, or attempts to obtain, a certificate of compliance
 by other means when required to report to the test-only
facility   without complying with this chapter 
after being identified as a tampered vehicle or gross polluter
pursuant to Section 44015 or 44081.
   (c) Any person who obtains or attempts to obtain a repair cost
waiver, or economic hardship extension pursuant to this chapter by
falsifying information shall be subject to a civil penalty of not
less than one hundred fifty dollars ($150) and not more than one
thousand dollars ($1,000), and shall be made ineligible for receiving
any repair assistance of any kind pursuant to this chapter.   
  SEC. 23.  Section 44060 of the Health and Safety Code is amended to
read: 
   44060.  (a) The department shall prescribe the form of the
certificate of compliance or noncompliance, repair cost waivers, and
economic hardship extensions.
   (b) The certificates, repair cost waivers, and economic hardship
extensions shall be in the form of an electronic entry filed with the
department, the Department of Motor Vehicles, and any other person
designated by the department.  The department shall ensure that the
motor vehicle owner or operator is provided with a written report,
signed by the licensed technician who performed the inspection, of
any test performed by a smog check station, including a pass or fail
indication, and written confirmation of the issuance of the
certificate.
   (c) (1) The department shall charge a fee to a smog check station,
including  a test-only station, and  a station
providing referee functions, for a motor vehicle inspected at that
station that meets the requirements of this chapter and is issued a
certificate of compliance, a certificate of noncompliance, repair
cost waiver, or economic hardship extension.
   (2) The fee charged pursuant to paragraph (1) shall be calculated
to recover the costs of the department and any other state agency
directly involved in the implementation, administration, or
enforcement of the motor vehicle inspection and maintenance program,
and shall not exceed the amount reasonably necessary to fund the
operation of the program, including all responsibilities,
requirements, and obligations imposed upon the department or any of
those state agencies by this chapter, that are not otherwise
recoverable by fees received pursuant to Section 44034.
   (3) Except for adjustments to reflect changes in the Consumer
Price Index, as published by the United States Bureau of Labor
Statistics, the fee for each certificate, waiver, or extension shall
not exceed seven dollars ($7).
   (4) Fees collected by the department pursuant to this subdivision
shall be deposited in the Vehicle Inspection and Repair Fund.  It is
the intent of the Legislature that a prudent surplus be maintained in
the Vehicle Inspection and Repair Fund.  If the surplus exceeds the
reasonable costs of administration of the programs specified in this
chapter and in Chapter 20.3 (commencing with Section 9880) of
Division 3 of the Business and Professions Code, the department
shall, by regulation, prescribe a lower fee for the certificates,
waivers, and extensions.
   (d) (1) Motor vehicles exempted under paragraph (4) of subdivision
(a) of Section 44011 shall be subject to an annual smog abatement
fee of four dollars ($4).  Payment of this fee shall be made to the
Department of Motor Vehicles at the time of registration of the motor
vehicle.
   (2) Fees collected pursuant to this subdivision shall be deposited
on a daily basis into the Vehicle Inspection and Repair Fund.
   (e) The sale or transfer of the certificate, waiver, or extension
by a licensed smog check station  or test-only station
 to any other licensed smog check station or to any other
person, and the purchase or acquisition of the certificate, waiver,
or extension, by any person, other than from the department, the
department's designee, or pursuant to a vehicle's inspection or
repair conducted pursuant to this chapter, is prohibited.
   (f) Following implementation of the electronic entry certificate
under subdivision (b), the department may require the modification of
the analyzers and other equipment required at smog check stations to
prevent the entry of a certificate  that has not been issued or
validated through prepayment of the fee authorized by subdivision
(c).
   (g) The fee charged by licensed smog check stations to consumers
for a certificate, waiver, or extension shall be the same amount that
is charged by the department.   
  SEC. 24.  Section 44062.1 of the Health and Safety Code is amended
to read: 
   44062.1.  (a) The department shall offer a low-income repair
assistance program beginning March 1, 1998, through entities
authorized to perform referee functions.
   (b)  (1) The repair assistance program shall be available to
eligible individuals based on a maximum income level of 175 percent
of the federal poverty level, as published quarterly in the Federal
Register by the Department of Health and Human Services.
   (2) The department shall offer low-income repair cost assistance,
funded by the High Polluter Repair or Removal Account in the Vehicle
Inspection and Repair Fund created pursuant to subdivision (a) of
Section 44091 and revenues generated by the smog impact fee pursuant
to Section 6262 of the Revenue and Taxation Code, to individuals who
obtain an economic hardship extension, based on the
cost-effectiveness and air quality benefit of the needed repair.
Repair assistance may include retesting costs.
   (3) An applicant for low-income repair assistance shall file an
application on a form prescribed by the department and shall certify
under penalty of perjury that the applicant meets the applicable
eligibility standards.
   (4) Verification of low-income eligibility shall be based on at
least one form of documentation, as determined by the department,
including, but not limited to, (A) an income tax return, (B) an
employment warrant, or (C) a form of public assistance verification.

   (c) The low-income repair assistance program shall be funded by
the High Polluter Repair or Removal Account until June 30, 1998.
Thereafter, a minimum of twenty million dollars ($20,000,000) shall
be made available annually for the program through funding provided
by revenues generated by the smog impact fee pursuant to Section 6262
of the Revenue and Taxation Code.
   (d) All repairs subsidized by the state through the program shall
be performed at a repair station licensed and certified pursuant to
 Sections   Section  44014  and
44014.2  at the time of testing and application for an
economic hardship extension.  Repair shall be based upon a
preapproved list of repairs for cost-effective emission reductions.
   (e) The qualified low-income motor vehicle owner receiving repair
assistance pursuant to this section shall contribute a copayment
equivalent to the repair cost limit, as determined by the department
as specified in Section 44017.1, either in cash, or in
emissions-related partial repairs as verified by a  test-only
  licensed smog check  station pursuant to
paragraph (2) of subdivision (c) of Section 44015, or a combination
thereof.  If the repair cost exceeds the applicable repair cost
limit, the department shall inform a qualified low-income motor
vehicle owner of all options for compliance at the time of testing
and repair.
   (f) The department shall collect data from the program to provide
information on how to improve the program.  Data collection shall
include all of the following:
   (1) The number of low-income motor vehicle owners that are
eligible for repair assistance.
   (2) The number of eligible motor vehicle owners that use repair
assistance funds.
   (3) The potential for fraud.
   (4) The average repair bills.
   (5) The types of repairs being done.
   (6) The amount of partial repairs done prior to receipt of repair
assistance.
   (7) The emissions benefits of providing repair assistance.
   (g) The department shall collect data and develop information and
shall report to the Legislature on or before April 1, 1999, on
eligibility criteria, program participation, the cost of vehicle
repairs, and the funding resources needed to implement the program.
   (h) For purposes of this section, "low-income motor vehicle owner"
means a person whose income does not exceed 175 percent of the
federal poverty level.   
  SEC. 25.  Section 44081 of the Health and Safety Code is amended to
read: 
   44081.  (a) (1) The department, in cooperation with the state
board, shall institute procedures for auditing the emissions of
vehicles while actually being driven on the streets and highways of
the state.  The department may undertake those procedures itself or
seek a qualified vendor of these services.  The primary object of the
procedures shall be the detection of gross polluters.  The
procedures shall consist of techniques and technologies determined to
be effective for that purpose by the department, including, but not
limited to, remote sensing.  The procedures may include pullovers for
roadside emissions testing and inspection.  The department shall
consider the recommendations of the review committee based on the
outcome of the pilot demonstration program conducted pursuant to
Section 44081.6.
   (2) The department may additionally use other methods to identify
gross polluting vehicles for out-of-cycle testing and repair.
   (b) The department shall, by regulation, establish a program for
the out-of-cycle testing and repair of motor vehicles found, through
roadside auditing, to be emitting at levels that exceed specified
standards.  The program shall include all of the following elements:

   (1) Emission standards, and test and inspection procedures and
regulations, adopted in coordination with the state board, applicable
to vehicles tested during roadside auditing.  Emission standards for
issuance of a notice of noncompliance to a gross polluter shall be
designed to maximize the identification of vehicles with substantial
excess emissions.
   (2) Procedures for issuing notices of noncompliance to owners of
gross polluters, either at the time of the roadside audit, or
subsequently by certified mail, or by obtaining a certificate of
mailing as evidence of service, using technologies for recording
license plate numbers.  The notice of noncompliance shall provide
that, unless the vehicle is brought to a  designated
test-only facility, or a  test-and-repair station that is
both licensed and certified pursuant to  Sections 
 Section  44014  and 44014.2 and is participating in
the pilot program pursuant to subparagraph (B) of paragraph (2) of
subdivision (g) of Section 44014.5,  for emissions testing
within 30 days, the owner will be required to pay an administrative
fee of five hundred dollars ($500) to be collected by the Department
of Motor Vehicles at the next annual registration renewal or the next
change of ownership of the vehicle, whichever occurs first.
Commencing on the 31st day after issuance of the notice of
noncompliance, the fee shall accrue at the rate of five dollars ($5)
per day up to the five hundred dollars ($500) maximum.
   (3) Procedures for the testing of vehicles identified as gross
polluters by  a designated test-only facility, or  a
test-and-repair station that is both licensed and certified pursuant
to  Sections   Section  44014  and
44014.2 and is participating in the pilot program pursuant to
subparagraph (B) of paragraph (2) of subdivision (g) of Section
44014.5,  to confirm that the vehicle exceeds the minimum
emission standard for gross polluters set by the department.
   (4) Procedures requiring owners of vehicles confirmed as gross
polluters to have the vehicle repaired, resubmitted for testing, and
obtain a certificate of compliance from a designated test-only
facility or removed from service as attested by a certificate of
nonoperation from the Department of Motor Vehicles within 30 days or
be required to pay an administrative fee of not more than five
hundred dollars ($500), to be collected by the Department of Motor
Vehicles at the next annual registration renewal or the next change
of ownership, whichever occurs first.  Commencing on the 31st day
after issuance of the notice of noncompliance, the fee shall accrue
at the rate of five dollars ($5) per day up to the five hundred
dollars ($500) maximum.  The registration of a vehicle shall not be
issued or renewed if that vehicle has been identified as a gross
polluter and has not been issued a certificate of compliance.  Except
as provided in subdivision (b) of Section 9250.18 of the Vehicle
Code, any revenues collected by the
         Department of Motor Vehicles pursuant to this subdivision
and Section 9250.18 of the Vehicle Code shall be deposited in the
Vehicle Inspection and Repair Fund.  If the ownership of the vehicle
is transferred, the administrative fee provided for in this
subdivision shall be waived if the vehicle is brought into
compliance.
   (5) A procedure for notifying the Department of Motor Vehicles of
notices of noncompliance issued, so that the Department of Motor
Vehicles may provide effective collection of the administrative fee.
The Department of Motor Vehicles shall cooperate with, and implement
the requirements of, the department in that regard.
   (c) The department may adopt any other regulations necessary for
the effective implementation of this section, as determined by the
department.
   (d) Upon the request of the department, the Department of the
California Highway Patrol shall provide assistance in conducting
roadside auditing, to consist of (1) the stopping of vehicles and
traffic management, and (2) the issuance of notices of noncompliance
to gross polluters.  The department shall reimburse the Department of
the California Highway Patrol for its costs of providing those
services.  The Department of Transportation and affected local
agencies shall provide necessary assistance and cooperation to the
department in the operation of the program.
   (e) There shall be no repair cost limit imposed pursuant to
Section 44017 for any repairs that are required to be made under the
roadside auditing program, except as provided in subdivision (c) of
Section 44017.
   (f) This section does not apply to vehicles operating under a
valid repair cost waiver or economic hardship extension issued
pursuant to Section 44015.   
  SEC. 26.  Section 44081.6 of the Health and Safety Code is amended
to read: 
   44081.6.  (a) The California Environmental Protection Agency, the
state board, and the department, in cooperation with, and with the
participation of, the Environmental Protection Agency, shall jointly
undertake a pilot demonstration program to do all of the following:
   (1) Determine the emission reduction effectiveness of alternative
loaded mode emission tests compared to the IM240 test.
   (2) Quantify the emission reductions, above and beyond those
required by Environmental Protection Agency regulation or by the
biennial test requirement, achievable from a remote sensing-based
program that identifies gross polluting and other vehicles and
requires the immediate repair and retest of those gross polluting
vehicles  at a test-only station established by this chapter
 .
   (3)  Determine if high polluting vehicles can be
identified and directed to test-only stations using criteria other
than, or in addition to, age and model year, and whether this reduces
the number of vehicles which would otherwise be subject to
inspection at test-only stations.
   (4)  Qualify emission reductions above and beyond those
that are required by the regulations of the Environmental Protection
Agency, achievable from other program enhancements pursuant to this
chapter.  
   (5) Determine the extent to which the capacity of the test-only
station network established pursuant to Section 44010.5 needs to be
expanded to comply with Environmental Protection Agency performance
standards. 
   (b) The California Environmental Protection Agency shall enter
into a memorandum of agreement with the Environmental Protection
Agency to establish the protocol for the pilot demonstration program.
  The memorandum of agreement shall ensure, to the extent possible,
that the Environmental Protection Agency will accept the results of
the pilot demonstration program as the findings of the Administrator
of the Environmental Protection Agency.  The pilot demonstration
program shall be conducted pursuant to the memorandum of agreement.
   (c) The review committee established pursuant to Section 44021
shall review the protocol for the pilot demonstration program, as
established in the signed memorandum of agreement, and recommend any
modification that the review committee finds to be appropriate for
the pilot demonstration program.  Any such modification shall become
effective only upon the written agreement of the California
Environmental Protection Agency and the Environmental Protection
Agency.
   (d) The department shall contract, on behalf of the committee,
with an independent entity to ensure quality control in the
collection of data pursuant to the pilot demonstration program.  The
department shall also contract, on behalf of the committee, for an
independent analysis of the data produced by the pilot demonstration
program.
   (e) Any contract entered into pursuant to this section shall not
be subject to any restrictions that are applicable to contracts in
the Government Code or in the Public Contract Code.  The department
shall report to the Legislature any action that is taken in
accordance with this subdivision.
   (f) To the extent possible, the pilot demonstration program shall
be conducted using equipment, facilities, and staff of the state
board, the department, and the Environmental Protection Agency.
   (g) The pilot demonstration program shall provide for, but not be
limited to, all of the following:
   (1) For the purposes of this section, any vehicle subject to the
inspection and maintenance program may be selected to participate in
the pilot demonstration program regardless of when last inspected
pursuant to this chapter.
   (2) Registered owners of vehicles selected to participate in the
pilot demonstration program shall make the vehicle available for
testing within a time period and at a testing facility designated by
the department.  If necessary, the department shall increase the
capacity of the existing referee network in the area or areas where
the pilot demonstration program will be operating, in order to
accommodate the convenient testing of selected vehicles.
   (3) If the department finds that a vehicle is emitting excessive
emissions, the vehicle owner shall be required to make necessary
repairs within the existing cost limits and return to a testing
facility designated by the department.  The vehicle owner shall have
additional repairs made if the repairs are requested and funded by
the department.  The department shall also fund the cost of any
necessary repairs if the owner of the vehicle has, within the last
two years, already paid for emissions-related repairs to the same
vehicle in an amount at least equal to the existing cost limits, in
order to obtain a certificate of compliance or an emission cost
waiver.
   (4) Vehicle owners who fail to bring the vehicle in for inspection
or fail to have repairs made pursuant to this section shall be
issued notices of noncompliance.  The notice shall provide that,
unless the vehicle is brought to a designated testing facility for
testing, or repair facility for repairs, within 15 days of notice of
the requirement, the owner will be required to pay an administrative
fee of not more than five dollars ($5) a day, not to exceed two
hundred fifty dollars ($250), to be collected by the Department of
Motor Vehicles at the next annual registration renewal or the next
change of ownership of the vehicle, whichever occurs first.
Commencing on the 31st day after issuance of the notice of
noncompliance, the fee shall accrue at the rate of five dollars ($5)
per day up to the two hundred fifty dollars ($250) maximum.  Except
as provided in subdivision (b) of Section 9250.18 of the Vehicle
Code, any revenues collected by the Department of Motor Vehicles
pursuant to this subdivision and Section 9250.18 of the Vehicle Code
shall be deposited into the Vehicle Inspection and Repair Fund by the
Department of Motor Vehicles.
   (h) The Department of Motor Vehicles, the Department of
Transportation, local agencies, and the state board shall provide
necessary support for the program established pursuant to this
section.
   (i) As soon as possible after  the effective date of this
section   September 30, 1994  , the department and
the state board shall develop, implement, and revise as needed,
emissions test procedures and emissions standards necessary to
conduct the pilot demonstration program.   
  SEC. 27.  Section 4000.3 of the Vehicle Code is amended to read:

   4000.3.  (a) Except as otherwise provided in Section 44011 of the
Health and Safety Code, the department shall require biennially, upon
renewal of registration of any motor vehicle subject to Part 5
(commencing with Section 43000) of Division 26 of the Health and
Safety Code, a valid certificate of compliance issued in accordance
with Section 44015 of the Health and Safety Code.  The department, in
consultation with the Department of Consumer Affairs, shall develop
a schedule under which vehicles shall be required biennially to
obtain certificates of compliance.
   (b) The Department of Consumer Affairs shall provide the
department with information on vehicle classes that are subject to
the motor vehicle inspection and maintenance program.
   (c) The department shall include any information pamphlet provided
by the Department of Consumer Affairs with notification of the
inspection requirement and with its renewal notices.   The
information pamphlet in the renewal notice shall also notify the
owner of the motor vehicle of the right to have the vehicle pretested
pursuant to Section 44011.3 of the Health and Safety Code. 

  SEC. 28.  (a) It is the intent of the Legislature to reimburse smog
check station owners for the reasonable costs incurred as a result
of complying with the regulations for enhanced vehicle inspection and
maintenance areas.
   (b) The Bureau of Automotive Repair (BAR) shall provide
reimbursement from funds appropriated pursuant to Item 1111-001-0582
of Section 2.00 of the Budget Act of 1998 to eligible smog check
station owners for appropriate costs including, but not limited to,
both of the following:
   (1) All reasonable equipment and installation costs associated
with complying with BAR regulations for enhanced vehicle inspection
and maintenance areas.
   (2) Costs associated with reasonable structural building
modifications made to accommodate the equipment.
   (c) For purposes of implementing this section, the BAR shall
determine all of the following:
   (1) The proper documentation required to verify reimbursable
expenses pursuant to subdivision (b).
   (2) The scope of acceptable and reasonable reimbursement costs.
   (3) A reasonable deadline for the submission of claims from
affected smog check and test-only station owners.
  SEC. 29.  This act is an urgency statute necessary for the
immediate preservation of the public peace, health, or safety within
the meaning of Article IV of the Constitution and shall go into
immediate effect.  The facts constituting the necessity are:
   In order to make statutory changes to implement the Budget Act of
1998 at the earliest possible time, it is necessary that this act
take effect immediately.   enacting this act to make the
necessary statutory changes to implement the Budget Act of 1998
relative to the Department of Consumer Affairs, including boards and
commissions within the department.