1.

Minutes of April 5, 2002 Board Meeting

2.

Set Public Hearings June 7, 2002 to Consider Amendments and/or Adoption to AQMD Rules and Regulations:

(A). Amend Rule 1168 - Adhesive and Sealant Applications

(B). Amend Rule 1193 - Clean On-Road Residential and Commercial
       Waste Collection Vehicles

3.

Issue RFP for Development of Hydrogen Fueling Station Template

4.

Execute Contracts for Technical Assistance for Advanced, Low- and Zero-Emission Mobile and Stationary Source Pollution Control Technologies

5.

Execute Contract for Maintenance and Management Services for Fast Fill Compressed Natural Gas Fueling Station at AQMD Headquarters

6.

Execute Contract to Cosponsor Development and Demonstration of Aftertreatment Technologies for PM Emissions Control of CNG-Fueled Heavy-Duty Engines

7.

Execute Contract to Cost Share Pilot Demonstration of Residential Fuel Cells

8.

Recognize Funds from CARB for Retrofitting Additional Particulate Trap Filters on Diesel School Buses and Execute Contract for New Lower-Emitting Diesel School Bus

9.

Recognize Revenues from U.S. Department of Energy to Augment AES Settlement Funds to Assist in Purchase of Natural Gas Passenger Cars for Taxicab Services

10.

Execute Contracts for AQIP Proposals Received During Fourth Quarter of 2001

11.

Execute Contract to Cofund Energy Efficiency Project

12.

Appropriate Funds for Newspaper Publication of Notices for Issuance of Permits Pursuant to Rule 212(g) Guidelines for Applications Subject to Regulations XXX (Initial and Revised Title V Permits), XIII, and XVII

13.

Approve Contracts Under Local Government Match Program as Part of FY 2001-02 AB 2766 Discretionary Fund Work Program; Grant MSRC Authority to Adjust Project Costs Up to 5%; and Authorize Board Chairman to Execute Agreements

14.

Public Affairs Report

15.

Report to Legislature and CARB on AQMD's Regulatory Activities for Calendar Year 2001

16.

Hearing Board Report

17.

Civil Filing and Civil Penalties Report

18.

Rule and Control Measure Forecast

19.

Lead Agency Projects and Environmental Documents Received by the AQMD

20.

Status Report on Major Projects for Information Management Scheduled to Start During Last Six Months of FY 2001-02

        Agenda Items 1, 2(A), and 3 were held for discussion. Mr. Antonovich indicated a conflict of interest on Agenda Items No. 6 and No. 10.

22.

Administrative Committee

23.

Finance Committee

24.

Legislative Committee

25.

Mobile Source Committee

26.

Stationary Source Committee

27.

Technology Committee

28.

Mobile Source Air Pollution Reduction Review Committee

29.

California Air Resources Board Monthly Report
(No Written Material - Transcripts of the meetings are available at CARB's web site, www.arb.ca.gov.)

DR. BURKE MOVED THAT THE BOARD APPROVE AGENDA ITEMS 2(B) AND 4 THROUGH 20; RECEIVE AND FILE AGENDA ITEMS 22 THROUGH 29; AND ADOPT THE FOLLOWING POSITIONS ON LEGISLATION, AS RECOMMENDED:

AB 2221 (Keeley) - Air Pollution Civil Actions   OPPOSE

AB 2312 (Chu) - Environmental Justice Grants   SUPPORT with
                                                                          AMENDMENTS

AB 2650 (Lowenthal) - Diesel Pollution at Ports SUPPORT with
                                                                          AMENDMENTS

AB 2682 (Chu) & SB 1994 (Soto) - Petroleum
Pollution Cleanup                                                SUPPORT

AB 2718 (Oropeza) - Distributed Generation      SUPPORT

SB 1827 (Torlakson) - AB 2766 Funding           OPPOSE

CARB Stationary Source Fee                             OPPOSE

THE MOTION WAS DULY SECONDED, AND PASSED BY THE FOLLOWING VOTE:

AYES:            Antonovich (except Items 6 & 10), Bernson, Burke,
                       Carney, Glover, LaPisto-Kirtley, Loveridge, Mikels,
                       Paulitz, Verdugo-Peralta, and Wilson.

NOES:            None.

ABSTAIN:      Antonovich (on Items 6 & 10 only).

ABSENT:        Silva.

21.

Items Deferred from Consent Calendar

1.

Minutes of April 5, 2002 Board Meeting

        Ms. Verdugo-Peralta requested that the Minutes be corrected with regard to the discussion on Agenda Item No. 5 on page 4 to reflect that she had pulled the item to discuss CNG and hydrogen compatibility and express her concern that the compressors were going to be sized for CNG fueling with the capability for future conversion to hydrogen, versus sizing the compressors for hydrogen fueling with the capability of conversion to CNG.

ON MOTION OF DR. WILSON, DULY SECONDED, AND CARRIED UNANIMOUSLY (Absent: Loveridge and Silva), THE BOARD APPROVED THE MINUTES OF THE APRIL 5, 2002 BOARD MEETING, CORRECTED TO REFLECT COMMENTS AS STATED BY MS. VERDUGO-PERALTA.

3.

Issue RFP for Development of Hydrogen Fueling Station Template

        At Ms. Verdugo-Peralta’s request, staff confirmed, with respect to CNG/hydrogen compatibility, that the templates being developed would have adequate design parameters for hydrogen fueling. Mr. Bernson clarified that the hydrogen fueling requires a higher degree of pressure than CNG and the concern was if the fueling equipment was sized for CNG, it would not be compatible for hydrogen. However, if it was sized for hydrogen, it would be compatible for CNG.

ON MOTION OF MS. VERDUGO-PERALTA, SECONDED BY MS. LaPISTO-KIRTLEY, AND CARRIED UNANIMOUSLY (Absent: Silva), THE BOARD APPROVED AGENDA ITEM
NO. 3 AS RECOMMENDED BY STAFF.

30.

Emission Reduction Credit System Modernization White Paper

        At Ms. Carney’s request, Dr. Elaine Chang, DEO of Planning, Rule 
Development & Area Sources gave a brief report and slide presentation on the item.

ON A MOTION DULY MADE AND SECONDED, AND CARRIED UNANIMOUSLY (Absent: Antonovich, Mikels, Paulitz, and Silva), THE BOARD APPROVED AGENDA ITEM NO. 30, RECEIVING AND FILING THE EMISSION REDUCTION CREDIT SYSTEM MODERNIZATION WHITE PAPER AND DIRECTING STAFF TO PROCEED WITH RULEMAKING TO IMPLEMENT THE RECOMMENDATIONS.

2(A)

Set Public Hearing June 7, 2002 to Amend Rule 1168 – Adhesive and Sealant Applications

        Mr. Kwonki Baik addressed the Board and commented that shoe repair businesses subject to the requirements of PAR 1168 are small operations that use a very small amount of adhesive, and there are no low-VOC alternative adhesives available to this industry. Also, these businesses do not have the resources to comply with recordkeeping requirements.

        Dr. Wallerstein noted that the item before the Board at this time was only the notification to the public that the Board will hold a public hearing on June 7 to consider adoption of proposed amendments to Rule 1168. He stated his understanding was that the shop owners would prefer a permanent exemption from Rule 1168, or at least an exemption through 2010. Staff was proposing an exemption through the end of 2008, with a one-year grace period for the shop owners to deplete their existing supply of materials. Staff is proposing 2009 in order to obtain the emission reductions and credit them to AQMD’s efforts to meet the 2010 date for attainment with the federal standard.

ON MOTION OF DR. WILSON, SECONDED BY MS. CARNEY, AND CARRIED UNANIMOUSLY (Absent: Silva), THE BOARD APPROVED AGENDA ITEM NO. 2(A) AS RECOMMENDED BY STAFF.

31.

Merits of a Centralized Market for RECLAIM

        In response to Ms. Verdugo-Peralta’s concern about market manipulation,
Dr. Chang indicated that staff believes timely posting of trade information under the current system would significantly minimize the potential for market manipulation. RECLAIM is a very small market, and any attempt at market manipulation would become obvious quickly. If staff were to notice that there was market manipulation, the AQMD could impose penalties. However, staff would first have to define what behavior constitutes or contributes to market manipulation, which, because of the way the present market is designed, would be difficult, if not impossible, at this time.

ON MOTION OF DR. BURKE, SECONDED BY
MS. LaPISTO-KIRTLEY, AND CARRIED UNANIMOUSLY (Absent: Silva), THE BOARD RECEIVED AND FILED ITEM NO. 31, AS RECOMMENDED BY STAFF.

32.

Adopt Executive Officer's FY 2002-03 AQMD Budget and Work Program

33.

Amend Regulation III - Fees

        Rick Pearce, DEO of Finance, and Larry Bowen, Senior Air Quality Engineering Manager, gave the staff reports on Items 32 and 33, respectively. Staff distributed to Board members, and made available to the public, copies of a revision to Subparagraph (x)(1) of PAR 301 inserting the word "operated" in the second sentence in order to clarify past and present practice.

        Ms. Carney expressed her appreciation to staff for adding language to
PAR 301 regarding specific time and material costs for selected special processing fees, as discussed at the Board’s April 19 workshop on the budget and proposed amendments to Regulation III.

        The public hearing was opened. There being no requests from the public to comment on Agenda Items 32 or 33, the public hearing was closed.

DR. WILSON MOVED APPROVAL OF THE STAFF RECOMMENDATIONS ON AGENDA ITEMS 32 AND 33:

1. REMOVING FROM RESERVES AND DESIGNATIONS ALL AMOUNTS ASSOCIATED WITH THE FY 2001-02 BUDGET;
   
   
2. APPROVING TOTAL APPROPRIATIONS OF $99,156,515;
   
   
3. APPROVING AN UNDESIGNATED FUND BALANCE OF $16,669,771 AND TOTAL RESERVES AND DESIGNATIONS OF $33,949,832;
   
   
4. RECOGNIZING ESTIMATED REVENUES OF $98,366,900; AND
   
   
5. ADOPTING RESOLUTION NO. 02-12, AMENDING REGULATION III (INCLUDING RULES 301, 303, 304, 304.1, 306, 307, 307.1, 308, 309, AND 311) AND CERTIFYING THE NOTICE OF EXEMPTION FROM CEQA REQUIREMENTS, AS RECOMMENDED BY STAFF, WITH THE FOLLOWING MODIFICATION TO RULE 301:

10. Fees for Non-Permitted Emission Sources Subject to Rule 222

            THE MOTION WAS SECONDED BY
            MS. VERDUGO-PERALTA AND CARRIED 
            UNANIMOUSLY
            (Absent: Paulitz and Silva).

34.

Amend Rule 1401 - New Source Review of Toxic Air Contaminants, and Report on Impacts Relative to Sources Subject to Rule 1402 - Control of Toxic Air Contaminants from Existing Sources

        Dr. Chang commented that the proposed amendments to Rule 1401 would update the list of compounds and effective dates in Table I of the rule to include chronic risk values for 13 compounds that were finalized by the Scientific Review Panel and the Office of Environmental Health Hazard Assessment. Staff's analysis conducted pursuant to Rule 1402 concluded that there will be no significant impacts on existing sources from use of the updated risk factors.

ON MOTION OF MS. LaPISTO-KIRTLEY, SECONDED BY
MS. VERDUGO-PERALTA, AND CARRIED UNANIMOUSLY (Absent: Paulitz and Silva), THE BOARD:

1. ADOPTED RESOLUTION NO. 02-13, AMENDING RULE 1401, RECEIVING AND FILING THE REPORT ON POTENTIAL IMPACTS RELATIVE TO SOURCES SUBJECT TO RULE 1402, AND CERTIFYING THE ADDENDUM TO THE JULY 1998 FINAL ENVIRONMENTAL ASSESSMENT FOR RULE 1401 AND MARCH 2000 FINAL ENVIRONMENTAL ASSESSMENT FOR RULE 1402; AND
   
   
2. ESTABLISHED AN EFFECTIVE DATE OF MARCH 1, 2003 FOR USING THE NEW AND UPDATED RISK VALUES IN HEALTH RISK ASSESSMENTS FOR RULE 1402.

35.

Amend Rule 1309.1 - Priority Reserve

        Dr. Laki Tisopulos, Assistant DEO/Planning, Rule Development & Area Sources, commented that PAR 1309.1 was a technical amendment whereby staff was proposing to allow a critical public works project access to the Priority Reserve bank for particulate emission credits. The public hearing was opened, and the Board heard testimony from the following individual:

PATRICK DENNIS, Attorney at Law, (for Jeff Blesner), City of Long Beach
        Expressed support for the proposed amendment, and indicated that he,
Mr. Blesner, and Charlie Plant, of Thums Long Beach, were prepared to answer any questions or address any comments regarding the proposed amendment.

        There being no further requests to address the Board on this item, the public hearing was closed.

ON MOTION OF DR. BURKE, SECONDED BY DR. WILSON, AND CARRIED UNANIMOUSLY (Absent: Bernson,
LaPisto-Kirtley, and Silva), THE BOARD ADOPTED RESOLUTION NO. 02-14, AMENDING RULE 1309.1 AND CERTIFYING THE ADDENDUM TO THE NOVEMBER 2001 FINAL ENVIRONMENTAL ASSESSMENT, AS RECOMMENDED BY STAFF.

36.

Adopt Ordinance Approving Addendum No.3 to Installment Purchase Agreement Relating to Diamond Bar Headquarters Facilities

37.

Adopt Resolution Approving Third Supplemental Trust Agreement, Escrow Agreement, and Preliminary Official Statement for SCAQMD Building Corporation Bonds Relating to Diamond Bar Headquarters Facilities

        Mr. Pearce reported briefly on Items 36 and 37; and the public hearing was opened.

        In response to questions by Ms. Carney, Mr. Pearce indicated that he believed it was best for long term planning to spread out the savings from the 2009 Term Bond redemption over the remaining 12 years of the bond term and realize savings each year to lower the annual budget, rather than having approximately an additional $6 million that could be utilized in 2009. He believed the interest differential between having the $6 million available in 2009 or spreading the money out over the remaining years of the bond term would be very small.

        Mr. Paulitz commented that many times there is a tendency, when you have a lump sum, to spend it; however, he concurred with staff’s recommendation as the best utilization of the savings from the bond redemption.

        There being no requests from the public to comment on Item 36 or Item 37, the public hearing was closed.

ON MOTION OF MS. VERDUGO-PERALTA, SECONDED BY MR. PAULITZ, AND CARRIED UNANIMOUSLY (Absent: Antonovich, Loveridge, and Silva), THE BOARD:

1. ADOPTED ORDINANCE NO. 02-01, APPROVING ADDENDUM NO. 3 TO THE INSTALLMENT PURCHASE AGREEMENT RELATING TO HEADQUARTERS FACILITY; AND
   
   
2. ADOPTED RESOLUTION NO. 02-15, APPROVING THE THIRD SUPPLEMENTAL TRUST AGREEMENT, THE

2002 ESCROW AGREEMENT, THE NOTICE INVITING PROPOSALS, THE CONTINUING DISCLOSURE AGREEMENT AND THE PRELIMINARY OFFICIAL STATEMENT FOR SCAQMD BUILDING CORPORATION BONDS RELATING TO HEADQUARTERS FACILITIES, AS RECOMMENDED BY STAFF.

        There was no public comment on non-agenda items.

        The Board recessed to closed session at 10:30 a.m. pursuant to Government Code sections:

• 54956.9(a), to confer with its counsel regarding pending litigation which has been initiated formally and to which the District is a party--the actions are Communities for a Better Environment v. Cenco Refining Company, et al., United States District Court Case No. 00-05665 AHM (AIJx) and MacDougall v. Thomas, AQMD, Los Angeles Superior Court Case No. GC027653; and
  
  
• 54956.9(c), to confer with its counsel to decide, based on existing facts and circumstances, whether to initiate litigation (one case).

        Following closed session, District Counsel Barbara Baird announced that a report of actions taken by the Board in closed session would be available in the Clerk of the Board’s office, and the meeting was adjourned at 10:30 a.m.

        The foregoing is a true statement of the proceedings held by the South Coast Air Quality Management District Board on May 3, 2002.

Respectfully Submitted,
 

SAUNDRA McDANIEL
Senior Deputy Clerk

Date Minutes Approved: ________________________

____________________________________________
                     Norma J. Glover, Chairman