BILL ANALYSIS
AB 859
Page 1
Date of Hearing: April 29, 2009
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Kevin De Leon, Chair
AB 859 (Jones) - As Amended: April 20, 2009
Policy Committee: TransVote:8-6
Urgency: No State Mandated Local Program:
Yes Reimbursable: No
SUMMARY
This bill requires vehicles 15 years and older to undergo annual
smog check inspections, and changes the amounts of financial
assistant available for vehicle repair and the eligibility for
that assistance. Specifically, this bill:
1)Requires vehicles 15 years and older, with certain exceptions,
to undergo annual smog check inspections, instead of the
existing biennial inspection schedule.
2)Directs any additional revenue resulting from more frequent
inspection to be deposited in the High Polluter Repair or
Removal Account (HPRR Account).
3)Increases from $450 to $750 the maximum possible payment to an
eligible owner of a high polluter vehicle.
4)Restricts eligibility for financial assistance for vehicle
repair to "low-income motor vehicle owners."
5)Increases the maximum income for purposes of defining a
"low-income vehicle owner" from 200% of the federal poverty
level to 300% of that level.
6)Requires BAR, in cooperation with ARB, to perform biennial
analyses, instead of "periodic" analysis as currently
required, of the statistical and emissions profiles of
vehicles subject to smog check.
FISCAL EFFECT
1)Annual revenue starting in 2010-11 of approximately $23
AB 859
Page 2
million resulting from additional annual certificate of
compliance fees. (HPRR Account.)
2)Annual costs starting in 2010-11 of approximately $20 million
from significantly more motorists being eligible for repair
assistance and from the potential need to provide this
assistance annually rather than biennially. (HPRR Account.)
3)Annual savings of $4 million starting in 2010-11 as a result
of eliminating the eligibility of non-low income vehicle
owners for financial assistance for vehicle repairs. (HPRR
Account.)
4)One-time costs in 2009-10 of $1 million to BAR for electronic
programming and other upgrades to implement bill. (HPRR
Account.)
5)One-time costs of $1 million to DMV in 2009-10 for update of
computer programming to implement this bill. (Vehicle
Inspection and Repair Fund or Motor Vehicle Account.)
6)Annual costs starting in 2010-11 of $650,000 to BAR for
increased dispute resolution and periodic electronic upgrades.
(HPRR Account.)
7)Annual costs of $1.5 million to DMV starting in 2010-11 for
costs associated with increased customer transactions. (Motor
Vehicle Account.)
COMMENTS
1)Rationale . This bill, by requiring older cars to be inspected
under the smog check program annually instead of biennially,
implements a recommendation made by the Inspection and
Maintenance Review Committee (IMRC), a public/private advisory
entity created by the Legislature. Subjecting these vehicles,
currently totaling about 2.2 million statewide, to annual
inspection is expected to yield cost-effective reductions in
the emissions of vehicular air pollutants, since older
vehicles fail their smog check inspections at three times the
rate of vehicles seven to 14 years old.
The author, concerned that the annual inspection requirement
for older vehicles would disproportionately impact low income
vehicle owners, argues that eligibility for low-income repair
cost assistance should be expanded to include higher incomes,
AB 859
Page 3
the amount of financial assistance available for repairs
should be increased, and revenue generated by the additional
certification of compliance fees should be earmarked to
increase resources available to BAR for the repair cost
assistance program and the vehicle retirement program.
2)Background. Current law establishes the smog check program,
administered by BAR and ARB, which generally requires vehicles
that are registered in non-attainment areas for ozone or
carbon monoxide to undergo biennial smog checks. Vehicles
that pass the inspection are provided a certificate of
compliance and are allowed to be registered and driven for
another two years. Vehicles that fail smog check must be
repaired or retired ("scrapped").
BAR offers financial assistance of up to $450 for vehicle
repair, with eligibility limited to individuals with incomes
at 200% of the federal poverty level, though BAR may increase
the maximum income level to 225%. However, a vehicle owner,
regardless of income, is eligible to receive financial
assistance for vehicle repair if the vehicle failed smog check
inspection at a "test-only" facility-one that conducts the
smog check but does not offer repair services.
Alternatively, vehicle owners are sometimes offered the option
of retiring their vehicles and receiving $1,500 from the
state. The program establishes no income level for
participation in the voluntary "scrappage" program.
3)Federal Poverty Level. The 2008 federal poverty level for a
household of four persons is $21,200. If the current income
cap for low-income repair cost assistance is increased from
225% to 300% of the federal poverty level, motorists from a
household of four persons would be eligible for this
assistance if their household income is less than $63,600.
Since the median household income for a family of four in
California is currently about $55,400, many households in
California would be eligible for BAR's low-income repair cost
assistance if the threshold is increased to 300%.
1)Related Legislation.
a) AB 823 (Hill), also before this committee today, is
similar to this bill in that it increases the amount paid
to an owner of a vehicle that fails smog check and who
AB 859
Page 4
chooses to retire the vehicle and restricts such funding to
low-income individuals.
b) AB 118 (Nunez), Chapter 750, Statutes of 2007,
established an enhanced fleet modernization program for the
retirement of high polluting vehicles that pass smog check
to be administered by BAR pursuant to guidelines adopted by
the ARB.
Analysis Prepared by : Jay Dickenson / APPR. / (916) 319-2081