FRIDAY, JULY 12, 1996 Board Minutes

SUMMARY MINUTES OF THE
SOUTH COAST AIR QUALITY MANAGEMENT DISTRICT
BOARD MEETING OF FRIDAY, JULY 12, 1996

Notice having been duly given, the regular meeting of the South Coast Air Quality Management District Board was held at District Headquarters, 21865 E. Copley Drive, Diamond Bar, California. Members present:

Supervisor Jon D. Mikels, Chairman
County of San Bernardino
Dr. William Burke, Vice Chairman
Speaker of the Assembly Appointee
Councilman Marvin Braude (arrived at 10:25 a.m.)
Cities of Los Angeles County - Western Region
Mayor Candace Haggard
Cities of Orange County
Ms. Mee H. Lee
Senate Rules Committee Appointee
Councilman Leonard Paulitz
Cities of San Bernardino County
Supervisor James W. Silva
County of Orange
Councilwoman Nell Soto
Cities of Los Angeles County - Eastern Region
Supervisor S. Roy Wilson, Ed.D.
County of Riverside

Members Absent:

Supervisor Michael D. Antonovich
County of Los Angeles
Mayor Ronald O. Loveridge
Cities of Riverside County

Vacant:

Governor's Appointee

The meeting was called to order at 9:40 a.m. by Chairman Mikels.

Opening Comments

Chairman Mikels. Announced the formation of an Ad Hoc Committee composed of himself, Vice Chairman Dr. Burke, Ms. Lee and Ms. Soto to consider implementation of the administrative changes adopted by the Board at its June 14, 1996 meeting in order to address concerns which prompted AB 3248 (Napolitano) -- Public Affairs Reorganization. The Board’s action at that time was provisional, to be implemented only upon the withdrawal of AB 3248 by Assemblywoman Napolitano. Although the bill was not withdrawn, Chairman Mikels believes there is merit in implementing some of the changes proposed.

CONSENT CALENDAR

Minutes of June 14, 1996 Board Meeting
Set Public Hearing August 9, 1996 to Amend Rule 1113 - Architectural Coatings
This item was withdrawn.
Approve Out-of-Country Travel
Execute Contracts for Air Quality Investment Program for the First Quarter of 1996
Execute Contracts for Air Quality Investment Program for the Final Quarter of 1995
(Continued from the June 14, 1996 Board Meeting)
Cost-Share the Development of a Prototype Economical Advanced Electric
Vehicle and a Plan for California Production (Continued from the June 14, Board Meeting)
Cost-Share the Retrofit of a Los Angeles County Metropolitan Transportation
Authority Methanol Bus to Operate on Compressed Natural Gas
Cost-Share the Modeling, Design, and Demonstration of a Fuel Cell Power System
for the Advanced Technology Transit Bus (ATTB)
Recognize and Appropriate Funds from the EPA for Three Air Monitoring Projects
Recognize and Appropriate Funds from the ARB for the Second Year Operation of
Monitoring Sites for the Children’s Health Study in the South Coast Air Basin
Recognize and Appropriate Funds From U.S. EPA to AQMD to be Used to Assist
States in Developing Their Small Business Assistance Programs
Issue RFP to Pre-Qualify Vendors for Library Services and Supplies
Issue RFP to Pre-Qualify Vendors for Replacement and Repair Services for the
Local Area Network, Wide Area Network, and Personal Computers
Issue RFQs to Pre-Qualify Vendors for Providing Recycled Copy Paper,
Printing Services, Miscellaneous Printing Paper Stock, Unleaded Fuel, and
Automotive Mechanical Repair and Service
Approve the Supplemental FY 1995-97 AB 2766 Discretionary Fund Work Program
and Execute Contracts
Public Advisor’s Report
AQMD Advisor, July 1996
Hearing Board Variances and Appeals
Lead Agency Projects and Environmental Documents Received by the AQMD
Rule Forecast

Agenda Items Nos. 7, 13, 14 and 15 were held for discussion.
ON MOTION OF MR. SILVA, SECONDED BY DR. WILSON, THE BOARD APPROVED AGENDA ITEMS 1 THROUGH 6, 8 THROUGH 12, AND 16 THROUGH 21 AS RECOMMENDED BY STAFF, BY THE FOLLOWING VOTE:

AYES: Burke, Haggard, Lee, Mikels, Paulitz, Silva (except Items 5 and 6), Soto and Wilson.
NOES: Silva (Items 5 and 6 only).
ABSENT: Antonovich, Braude and Loveridge.

21(A) Items Deferred from Consent Calendar

7. Cost-Share the Development of a Prototype Economical Advanced Electric
Vehicle and a Plan for California Production (Continued from the June 14, Board Meeting)

The following individuals commented in support of the staff recommendation on this item:

TOM CACKETTE, Air Resources Board

Referred to two documents submitted to the Governing Board in response to it's request at the June 14, 1996 meeting for further information from ARB and Cal-EPA on this proposal: (i) a letter dated July 10, 1996 from James Strock, Cal-EPA Secretary for Environmental Protection, requesting the Board's support of the proposed project and pointing out that the project will help maintain California's leadership role in advanced transportation technologies; and (ii) a letter dated July 10, 1996 from ARB Chairman John Dunlap addressing four questions raised by the Governing Board at its June 14 meeting regarding the necessity for the proposed project in light of Toyota's prototype EV and the existing commitment by the major automobile manufacturers to produce low volumes of EVs, justification for the proposal not being competitively bid, and justification for engaging a company located in Michigan to perform the project.

JOHN STEARNS, Project California

Urged the Board to support the proposal from Troy Design and Manufacturing (TDM) because of TDM's qualifications (extensive automotive design and manufacturing experience and an existing customer base of mainstream automobile companies in both the U.S. and abroad), the product (not simply another prototype; but the proposal includes a complete manufacturing and production plan, which will give public authorities, for the first time, a concrete measure by which to judge estimates of vehicle price and manufacture ability) and the benefit to California (TDM is committed to a California manufacturing facility, and is already involving California companies Automotive Components Plastics Technologies of Huntington Beach is supplying composite technology, AeroVironment of Monrovia is supplying battery management technology and Northrop Grumman is providing the drivetrains for prototype vehicles).
(Submitted Written Comments)

JOHN SLIFKO, Congressman Howard Berman

Read into the record a letter submitted to the Board from Congressmen Howard Berman,
Anthony Beilenson, Julian Dixon and Henry Waxman expressing their support for the proposed project, which they believe will help American industry capture emerging global transportation markets and help advance the state-of-the-art for technologies such as fuel cells and advanced composite materials, as well as provide substantive technical support for ARB&'s ZEV Rule and valuable data in support of the AQMP.

The following individuals addressed the Board to speak in opposition to the staff recommendation:

*ANITA MANGELS, Californians Against Hidden Taxes
LES BERRIMAN, Drivers for Highway Safety
BILL WARD, Committees of Correspondence
WAYNE KING, concerned citizen
ANTHONY TRUJILLO, concerned citizen
ROBERT AULT, Committees of Correspondence
LUCI GRISMER, concerned citizen
MARIE WHALING, concerned citizen
DR. KENNETH GREEN, Reason Foundation
*Submitted Written Comments

The key points/issues raised by the individuals listed above are summarized as follows:

The proposed project will provide no measurable emissions reductions, therefore AQMD should not be involved.
EVs meeting the specifications of the TDM proposal are already available; and the ARB has entered into contracts with the "Big Seven" automakers to develop EVs, making the TDM contract a duplication of effort.
The TDM proposal was negotiated outside the competitive bidding process required of all state contracts.
The proposed contract will cause the export of almost $2 million in public funds to Michigan. Funds earmarked for the TDM contract are derived from state-mandated registration fees on motor vehicles in the District, and members of the public would view this charge as a tax.
TDM World Conversions, a division of TDM, performed a number of AQMD-funded CNG vehicle conversions for the San Bernardino County Sheriff's Department. Minutes of the MSRC meeting cite various and unavoidable delays, coupled with safety defects found in the majority of TDM vehicles. TDM abruptly closed its facility in April 1995 without fulfilling its contractual obligations.
This program and others like it will actually delay the development of practical EVs by interfering with free market funding mechanisms.

JOHN LONGVILLE, MSRC

In response to comments by Ms. Mangels with respect to hidden costs/taxes, pointed out that the costs we pay when we drive petroleum-powered vehicles are hidden in more than just tax dollars, but also in the health effects that petroleum generates for all of us in Southern California and throughout the nation.

(Mr. Braude arrived at 10:25 a.m., during public comment.)

Written Comments Submitted By:
Quenton Attwool, Handle With Care Packaging Store
Helen Bickham-Devine and Paul Bickham, Paul Bickham Insurance Service
Van T. Bivans, Super 8 Motel
Angelo B. Castagnola, Castagnola Tug Service, Inc.
George Dupray, California State Grange
Carol Frie, Thomson Law Office
Senator Raymond N. Haynes, California State Senate
Bernard Jorrick
Joseph Languemi Sr.
Douglas B. Large, Archbald & Spray, Attorneys at Law
Assemblyman Bill Morrow, Assembly, California Legislature
Jack A. Nelson, General Contractor
William Rayhern
George Reiss, Public Service Marine Inc.
Assemblyman Bernie Richter, Assembly, California Legislature
Eugene Rosato
Robin Sim
Harold L. Spencer
Curtis Stricker
Bill A. Trapp
Robin Tyler
Lewis K. Uhler, The National Tax Limitation Committee

Mr. Silva commented that, as a member of ARB, he supported the extension of the EV mandate. It his belief that the EV has a future, but in order for the EV to be successful--not only in California but throughout the United States--it will have to be market-driven. The proposed project will bring jobs to the South Coast basin and will provide information on design, development and production costs. The auto industry does not share this information, and rightfully so. This information will be valuable in planning future projects and will help AQMD in keeping its commitment to improve air quality in the basin.

ON MOTION OF MR. PAULITZ, SECONDED BY MS. SOTO, A UNANIMOUS VOTE WAS CAST BY THE BOARD MEMBERS PRESENT (Absent: Antonovich and Loveridge) AUTHORIZING THE CHAIRMAN TO EXECUTE A CONTRACT WITH THE ARB TO CO-FUND THE DESIGN AND PRODUCTION ANALYSIS OF AN ADVANCED ELECTRIC VEHICLE, NOT TO EXCEED $500,000, AS RECOMMENDED BY STAFF.

13. Issue RFP to Pre-Qualify Vendors for Library Services and Supplies

14. Issue RFP to Pre-Qualify Vendors for Replacement and Repair Services for the Local Area Network, Wide Area Network, and Personal Computers

15. Issue RFQs to Pre-Qualify Vendors for Providing Recycled Copy Paper, Printing Services, Miscellaneous Printing Paper Stock, Unleaded Fuel, and Automotive Mechanical Repair and Service

Ms. Soto thanked staff for the extra outreach effort now being made to encourage MBE/WBE/DVBE participation in AQMD contracting.

ON MOTION OF DR. WILSON, DULY SECONDED, A UNANIMOUS VOTE WAS CAST BY THE BOARD MEMBERS PRESENT (Absent: Antonovich, Loveridge and Mikels.) APPROVING AGENDA ITEMS 13, 14 AND 15 AS RECOMMENDED.

BOARD CALENDAR

22. Administrative Committee

23. Legislative Committee

24. Mobile Source Committee

25. Stationary Source Committee

Ms. Lee noted the following correction to the Stationary Source Committee report: There is no Committee meeting scheduled in July; the next Committee meeting is scheduled for
August 23, 1996.

26. Technology Committee

27. Interagency AQMP Implementation Committee

28. Mobile Source Air Pollution Reduction Review Committee

29. Air Resources Board Monthly Meeting Note: The summary of the May ARB monthly meeting will be provided in the agenda package for the August 9, 1996 Governing Board meeting.

ON MOTION OF MS. LEE, SECONDED BY MR. PAULITZ, A UNANIMOUS VOTE WAS CAST BY THE BOARD MEMBERS PRESENT (Absent: Antonovich, Loveridge and Mikels.) APPROVING RECEIPT AND FILE OF AGENDA ITEMS 22 THROUGH 28 AS RECOMMENDED.

PUBLIC HEARINGS

30. Amend Rule 430 - Breakdown Provisions

Carol Coy, Assistant DEO of Stationary Source Compliance, presented the staff report. An errata sheet was distributed to Board members containing the following revision to Subparagraph (b)(3)(B) of PAR 430 recommended by staff:

"(B) Subparagraph (b)(3)(A) shall not apply to the following District Regulations, Rules and permit conditions:
(i) Regulation I, IX, X, XIV, XVII, XX , XXX, and XXXI;
(ii) Rules 218 and 402;
(iii) any permit condition which implements any Rule or Regulation specified in clause (i) or (ii)."

The public hearing was opened. There being no requests from the public to speak on this item, the hearing was closed.

Written Comments Submitted by:
Kenneth Bigos, United States Environmental Protection Agency

ON MOTION OF DR. WILSON, SECONDED BY MS. LEE, A UNANIMOUS VOTE WAS CAST BY THE BOARD MEMBERS PRESENT (Absent: Antonovich and Loveridge) ADOPTING RESOLUTION NO. 96-13, AMENDING RULE 430 AND CERTIFYING THE FINAL SUPPLEMENTAL ENVIRONMENTAL ASSESSMENT FOR PROPOSED AMENDED REGULATION XX, AS RECOMMENDED, WITH THE FOLLOWING MODIFICATION TO SUBPARAGRAPH (b)(3)(B) OF RULE 430 RECOMMENDED BY STAFF

"(B) Subparagraph (b)(3)(A) shall not apply to the following District Regulations, Rules and permit conditions:
(i) Regulation I, IX, X, XIV, XVII, XX , XXX, and XXXI;
(ii) Rules 218 and 402;
(iii) any permit condition which implements any Rule or Regulation specified in clause (i) or (ii)."

31. Amend Rules 2002 - Allocations for NO_x and SO_x, 2004 - Requirements, 2005 - New Source Review for RECLAIM, 2011 - Requirements for Monitoring, Reporting, and Recordkeeping for SO_x Emissions, 2012 - Requirements for Monitoring, Reporting, and Recordkeeping for NO_x Emissions, and 2015 - Backstop Provisions

Pang Mueller, Senior Enforcement Manager, presented the staff report.
Cindy Greenwald, Planning Manager, reported briefly on the socioeconomic assessment performed for the proposed amendments.

In response to concern expressed by Mr. Braude, Pat Leyden, DEO of Stationary Source Compliance, assured Mr. Braude that the proposed amendments are all essentially fine tuning issues and do not diminish in any way AQMD's ability to properly monitor industry compliance and to impose additional monitoring or regulatory provisions than currently exist in order to achieve the fundamental goals of RECLAIM.

The public hearing was opened, and the Board heard testimony from the following individuals:

LEE WALLACE, Southern California Gas Company
STAN HOLM, Mobil Oil Corporation

Expressed support for the proposed amendments, and commented that industry has made substantial progress in negotiations with staff on a number of issues which would further clarify the RECLAIM requirements for CEMS and missing data procedures.

TED METROSE, Western Independent Refiners Association

Commented that one of the main problems with the missing data procedures is that there are no variances allowed from missing data procedures; and there should be variances allowed to address cases where missing data procedures result in a significant overstatement of emissions. (Submitted Written Comments)

JOHN BENNETT, California Portland Cement Company

Expressed support of the proposed amendments pertaining to gray cement kilns, and requested that the July 1, 1996 and February 1, 1998 compliance dates in Rule 2015, Subparagraph (c)(3)(D), be extended one month to adjust for the one month delay of the public hearing date.

Ms. Coy indicated staff's agreement to extension of the two dates from "July 1, 1996" and "February 1, 1998" to "August 1, 1996" and "March 1, 1998", respectively.

With respect to the inability to obtain a variance from the missing data procedures,
Ms. Leyden explained that EPA has indicated that it would not approve the rule if it included a variance provision. Most companies have their CEMS installed and operating, so this issue involves only a small subset of companies--most of which have purchased the equipment and with due diligence are trying to get their CEMS to operate. Staff is working with industry to bring an amendment to the rule back to the Board before the end of 1996 that would allow a minor extension of time on the use of interim reporting in those cases where companies have purchased and installed the equipment and is simply trying to get the equipment to test and certify correctly.

ON MOTION OF MS. LEE, SECONDED BY MS. HAGGARD, A UNANIMOUS VOTE WAS CAST BY THE BOARD MEMBERS PRESENT (Absent: Antonovich and Loveridge) ADOPTING RESOLUTION NO. 96-14, AMENDING RULES 2002, 2004, 2005, 2011, 2012 AND 2015 AND CERTIFYING THE FINAL SUPPLEMENTAL ENVIRONMENTAL ASSESSMENT, AS RECOMMENDED BY STAFF, WITH THE MODIFICATION TO SUBPARAGRAPH (c)(3)(D) OF RULE 2015 TO CHANGE THE
"JULY 1, 1996" AND "FEBRUARY 1, 1998" COMPLIANCE DATES TO " AUGUST 1, 1996 " AND "MARCH 1, 1998", RESPECTIVELY, AS RECOMMENDED BY STAFF.

PUBLIC COMMENT PERIOD - (Public Comment on Non-Agenda Items, Pursuant to Government Code Section 54954.3)

There was no public comment on non-agenda items.

CLOSED SESSION

32. Closed Session to Consider Pending or Potential Litigation and Personnel Matters

The Board recessed to closed session at 11:12 a.m.:

* Pursuant to Government Code Section 54957.6(a), to meet with designated representatives regarding salaries and benefits of represented and unrepresented employees. Agency negotiator(s): Nick Nikkila/Charles Goldstein. Employee organizations: San Bernardino Public Employees Association and Teamsters Local 911.
* Pursuant to Government Code Section 54956.9(a), to confer with counsel regarding the following pending litigation which has been initiated formally and to which the District is a party: Advincula, et. al. v. SCAQMD, et al., Los Angeles Superior Court, Case
No. BC109296.
* Pursuant to Government Code Section 54956.9(b)(1), to confer with counsel because based on existing facts and circumstances there is a significant exposure to litigation against the agency.

The Board reconvened at 11:49 a.m., and General Counsel Peter Greenwald indicated that the report on action taken by the Board in closed session is on file in the Clerk of the Boards'; Office.

ADJOURNMENT

The meeting was adjourned by Chairman Mikels at 11:50 a.m.

The foregoing is a true statement of the proceedings held by the South Coast Air Quality Management District Board on July 12, 1996.

Respectfully Submitted,

SAUNDRA McDANIEL

Senior Deputy Clerk

Date Minutes Approved: ________________________

____________________________________________

Jon D. Mikels, Chairman

ACRONYMS

AB = Assembly Bill
AQMD = (South Coast) Air Quality Management District
AQMP = Air Quality Management Plan
ARB/CARB = California Air Resources Board
Cal-EPA/U.S. EPA = California/United States Environmental Protection Agency
CNG = Compressed Natural Gas
DEO = Deputy Executive Officer
EV = Electric Vehicle
FY = Fiscal Year
MBE/WBE/DVBE = Minority-, Woman-, Disabled Veteran-Owned Business Enterprise
MSRC = Mobile Source (Air Pollution Reduction) Review Committee
NOx = Oxides of Nitrogen
PAR = Proposed Amended Rule
RECLAIM = REgional CLean Air Incentives Market
RFP = Request for Proposals
RFQ = Request for Quotations
SIP = State Implementation Plan
SOx = Oxides of Sulfur
ZEV = Zero Emission Vehicle

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