BILL ANALYSIS                                                                                                                                                                                                    






           SENATE TRANSPORTATION & HOUSING COMMITTEE       BILL NO: ab 1740
          SENATOR ALAN LOWENTHAL, CHAIRMAN               AUTHOR:  jeffries
                                                         VERSION: 2/22/10
          Analysis by:  Jennifer Gress                   FISCAL:  yes
          Hearing date:  June 15, 2010








          SUBJECT:

          Specially constructed vehicles:  smog check

          DESCRIPTION:

          This bill increases the number of specially constructed  
          vehicles, from 500 to 750, that the Department of Motor Vehicles  
          (DMV) may register using a process that may exempt the vehicle  
          from the smog check program and clarifies that an owner of a  
          specially constructed vehicle may re-register his or her vehicle  
          with a different model year in order to take advantage of the  
          exemption.

          ANALYSIS:

          Existing law prohibits the operation upon public highways of any  
          motor vehicle that has not been registered with DMV.  An  
          application for registration must be accompanied by payment of a  
          sales and use tax that is based on the vehicle's value and a  
          certificate of compliance indicating that the vehicle has passed  
          its smog inspection.  

          To meet federal air quality standards, existing law requires  
          California-registered, gasoline-powered and certain  
          diesel-powered vehicles to undergo biennial smog inspections to  
          measure motor vehicle-related pollutants.  New vehicles six  
          model-years old and newer, vehicles with a pre-1976 model year,  
          electric vehicles, motorcycles, and large commercial vehicles  
          are exempt from the smog check program.  

          The current smog inspection involves testing for the gaseous  
          emissions of hydrocarbons, carbon monoxide, and oxides of  




          AB 1740 (JEFFRIES)                                        Page 2

                                                                       


          nitrogen.  Emissions standards have become more stringent over  
          time and are established by model year.  For example, a 2004  
          model-year vehicle must produce fewer emissions to pass its smog  
          inspection than a 1990 model-year vehicle.  If a vehicle fails  
          any component of a smog inspection, the vehicle owner must, with  
          some exceptions, repair the vehicle and pass a subsequent smog  
          inspection before being able to register or renew the  
          registration of the vehicle.

          A specially constructed vehicle, sometimes referred to as a "kit  
          car," is defined as a vehicle that is "built for private use,  
          not for resale, and is not constructed by a licensed  
          manufacturer or remanufacturer."  In 2001, the Legislature  
          passed and the Governor signed SB 100 (Johannessen), Chapter  
          871, which authorizes DMV to register up to 500 "specially  
          constructed vehicles" each year in a manner that may exempt the  
          vehicles from the smog check program.  

          Under SB 100, a specially constructed vehicle must be inspected  
          by smog inspection facilities authorized to perform "referee"  
          functions for the purposes of determining the vehicle model year  
          or the engine year used in the vehicle and thus the appropriate  
          emission control application for that model year.  In  
          determining the model year of the vehicle or the engine (the  
          vehicle owner may choose whether the model year determination is  
          based on the vehicle or on the engine), the referee shall  
          compare the vehicle or engine to those of the era it most  
          closely resembles.  The referee shall assign the 1960 model year  
          if the vehicle or the engine does not sufficiently resemble a  
          previously manufactured vehicle or engine.  

          If DMV receives an application for registration of a specially  
          constructed vehicle after it has already registered 500 such  
          vehicles during that calendar year, and the vehicle has not been  
          previously registered, DMV shall assign the vehicle the same  
          model year as the calendar year in which the application is  
          submitted for purposes of determining emissions control  
          equipment and inspection requirements for the vehicle.   
          Specially constructed vehicles that were registered after DMV  
          registered the first 500 vehicles may re-apply for registration  
          as a specially constructed vehicle in future years, in which  
          case an authorized referee would determine the model year of the  
          vehicle or its engine.

           This bill  :





          AB 1740 (JEFFRIES)                                        Page 3

                                                                       


           Increases the number of specially constructed vehicles, from  
            500 to 750, that DMV may register using the SB 100 process  
            that may exempt those vehicles from the smog check program.

           Clarifies that an owner of a specially constructed vehicle  
            that was not one of the first 500 vehicles to register in a  
            given year may, in a subsequent year, re-register his or her  
            vehicle with a different model year in order to earn one of  
            the 500 slots and be exempted from the smog check program.
          
          COMMENTS:

           1.Purpose  . The author contends that the current 500 limit on the  
            number of specially constructed vehicles that may be exempted  
            from the smog check program is too low and too limiting.  The  
            types of cars that will be brought into California with the  
            removal of this limit are almost exclusively used for car  
            shows and have limited environmental impact.  Removing this  
            limit will allow hobbyists to more fully engage in their  
            trade, a trade which often has significant charitable and  
            economic benefits to California.

           2.Demand for increase  ?  At the time this analysis was prepared,  
            DMV had registered only 403 specially constructed vehicles  
            under the SB 100 provisions.  While all 500 slots will likely  
            be taken by the end of this calendar year, it does not appear  
            that 500 is a particularly low number.  

           3.Air quality impacts of specially constructed vehicles  .   
            Specially constructed vehicles typically lack emission control  
            equipment and thus produce high levels of emissions.   
            According to data provided by the Air Resources Board (ARB)  
            comparing the emissions of specially constructed vehicle to  
            those produced by 2005 model-year vehicles, specially  
            constructed vehicles emit, on average, 200 times more  
            smog-forming emissions than the conventional vehicle.   
            Supporters of the measure refute ARB's findings.  They contend  
            that while specially constructed vehicles are higher emitting  
            than conventional vehicles, their own analysis, based on one  
            vehicle, suggests that the magnitude of emissions is much  
            smaller than ARB indicates.  
          
           4.Costs of specially constructed vehicles and emission control  
            devices  .  According to representatives from the Specialty  
            Equipment Manufacturers Association, specially constructed  
            vehicles vary in cost from $80,000 to $450,000.  A retrofit  




          AB 1740 (JEFFRIES)                                        Page 4

                                                                       


            device designed to reduce emissions from specially constructed  
            vehicles costs $6,000 to $6,500 and can enable a vehicle to  
            meet the 2003 model-year emission standards.  Additionally,  
            General Motors is now manufacturing an engine that can be  
            placed in specially constructed vehicles that will enable the  
            vehicle to meet current 2010 emission standards.  These  
            engines cost $8,000 to $10,000.  In other words, the  
            technology exists to enable vehicles that register after the  
            500 cap has been met to meet more stringent emissions  
            standards.  Furthermore, specially constructed vehicles are  
            expensive vehicles and some argue that if a vehicle owner can  
            afford to build such a vehicle, he or she could also afford to  
            retrofit the vehicle with an emissions control device.

          Assembly Votes:
               Floor:    44-22
               Appr: 11-6
               Trans:    8-4

          POSITIONS:  (Communicated to the Committee before noon on  
          Wednesday, 
                     June 9, 2010)

               SUPPORT:  Cruisin' for a Cure
                         The Faithful
                         Good Guys Rod & Custom Association
                         Over the Hill Gang - Temecula Valley
                         Specialty Equipment Manufacturers Association
                         Approximately 1200 individuals

               OPPOSED:  Bay Area Air Quality Management District
                         California Air Pollution Control Officers  
          Associations
                         Sierra Club
                         South Coast Air Quality Management District