GOVERNING BOARD AGENDA
MEETING, March 1, 2002

Pledge of Allegiance

Opening Comments:

• Norma J. Glover, Chair
• Other Board Members
• Barry R. Wallerstein, D. Env., Executive Officer

Adoption of Proclamation in memory of Dr. Robert Morris Zweig

• Glover

CONSENT CALENDAR (Items 1 through 30)

Note: Consent Calendar items held for discussion will be moved to Item No. 31.

1. Minutes of February 1, 2002 Board Meeting
Dix (909) 396-2500
(jdix@aqmd.gov)

2. Set Public Hearing April 5, 2002 to Amend Regulation IX - Standards of Performance for New Stationary Sources
Wallerstein (909) 396-3131
(bwallerstein@aqmd.gov)

Local air districts are authorized by EPA to implement federal standards set in 40 Code of Federal Regulations (CFR) Part 60, Standards of Performance for New Stationary Sources (NSPS) and Part 61, National Emission Standards for Hazardous Air Pollutants (NESHAPs). Periodic amendments to Regulations IX and X incorporate new or amended standards by reference. Eight actions regarding NSPS are proposed for incorporation into Regulation IX. There were no actions regarding NESHAP, Part 61 which is reflected in Regulation X. The NSPS changes include clarifications and corrections, administrative changes, and changes to test methods and monitoring. Affected industries include: commercial and industrial solid waste incineration units; electric utility steam generating units; industrial-commercial-institutional steam generating units; and large municipal waste combustors. (Review: Stationary Source Committee, February 22, 2002)

Budget/Fiscal Impact

3. Authorize Executive Officer to Purchase NOx RTCs
Wallerstein (909) 396-3131
(bwallerstein@aqmd.gov)

In May 2001, the Board amended RECLAIM, temporarily separating existing power plants from the RECLAIM market and precluding them from purchasing NOx RTCs to reconcile emissions to stabilize NOx RTC prices. For 2001, some power plants and other RECLAIM facilities have excess NOx RTCs, which are surplus in the RECLAIM market. This action proposes to authorize the Executive Officer to purchase excess NOx RTCs for the purposes of offsetting power plant emissions and RTC deductions from power plants. Funding for this purchase is available in the Executive Officer Mitigation Account, Fund 27.

4. Execute Contract to Cost Share Development of Odorant for Liquefied Natural Gas
Liu (909) 396-2105
cliu@aqmd.gov

Gaseous odorants are used in commercial and residential natural gas to alert consumers of gas leakage. These odorants are also found in compressed natural gas (CNG) which originates from odorized pipeline natural gas. However, liquefied natural gas (LNG) is a cryogenic liquid in which normal natural gas odorants freeze, separate and are not useful. Current LNG vehicles have methane detectors to warn of leakages instead of odorants. Staff proposes the initial development of an LNG odorant which expands the options for detecting methane leakage. Total project cost is approximately $418,320. Total AQMD cost to fund this project will not exceed $123,835. (Review: Technology Committee, January 25, 2002)

5. Execute Contract to Cosponsor Study for Commercialization of Advanced Hybrid Electric Vehicles
Liu (909) 396-2105
cliu@aqmd.gov

The Electric Power Research Institute (EPRI) assembled a working group that compared the impacts and benefits of various hybrid electric vehicle options for light and medium-duty vehicles. Technology developments in the areas of fuel cell hybrid electric vehicles, plug-in hybrid electric vehicles with vehicle-to-grid power capability and other advancements have enhanced the paths to commercialization. The total cost of this project to evaluate the paths to commercialization of advanced hybrid electric vehicles is $1,300,000. The AQMD’s contribution shall not exceed $250,000, with contributions of $250,000 from CARB, $150,000 from Department of Transportation, and $650,000 from EPRI and its members. Clean Fuel funds are available in the Technology Advancement Plan updated March 2002 in category M5-4. (Review: Technology Committee, January 25, 2002)

6. Execute Agreement for Membership in Hybrid Electric Truck Operator's Forum
Liu (909) 396-2105
cliu@aqmd.gov

The Hybrid Electric Truck Operator's Forum (HETOF) is an industry/government program to enable and accelerate the hybrid-electric, medium-and heavy-duty truck market. Primary goals of the HETOF include coordinating efforts in advancing hybrid-electric technology and increasing the fuel efficiency of medium- and heavy-duty trucks. CALSTART will work with the National Automotive Center, a research and development organization within the Department of the Army, to launch HETOF. This action is to execute an agreement with CALSTART to provide $25,000 from the Technology Advancement Professional and Special Services Account for cosponsoring the HETOF in Calendar Year 2002. (Review: Technology Committee, January 25, 2002)

7. Approve Issuance of Program Announcement and Application for FY 2001-02 Lower-Emission School Bus Retrofit Program Funding
Liu (909) 396-2105
cliu@aqmd.gov

The State’s FY 2001-02 Budget contains $16 million for the Lower-Emission School Bus Program. The AQMD has received $5.31 million for the replacement and $1.77 million for the retrofit components of the program allocated for the South Coast Air Basin. The program announcement for the school bus replacement component of the program was issued on December 21, 2001. The proposed program announcement and application will provide funding for a total of $1.77 million to retrofit school buses with particulate traps. (Review: Technology Committee, February 22, 2002)

8. Approve Grants to Public School Districts to Purchase Lower-Emitting Diesel and Alternative Fuel School Buses and Infrastructure under Lower-Emission School Bus Replacement Program for FY 2001-02
Liu (909) 396-2105
cliu@aqmd.gov

The AQMD Program Announcement & Application PA2002-03 "Lower-Emission School Bus Program" was issued on December 21, 2001 to replace older school buses with new alternative fuel and lower-emitting diesel buses. A total of 32 applications were received. Staff recommends the approval of the school bus replacement awards for 39 CNG and 20 lower-emitting diesel buses in an amount not to exceed $6.841 million, comprised of $5.841 million from the Lower-Emission School Bus Fund, and $1 million from the AES Settlement Projects Fund set aside for the Adopt-a-School Bus Foundation. Staff also recommends an increase in the sales tax allocation for buses awarded in FY 2000-01 by a quarter of a percent in an amount not to exceed $48,067 due to increase in sales tax rate. (Review: Technology Committee, February 22, 2002)

9. Execute Additional Contracts to Generate Emissions Credits Under State Emissions Mitigation Program
Liu (909) 396-2105
cliu@aqmd.gov

At the July 20, 2001 meeting, the Board established the State Emissions Mitigation Fund to recognize up to $30,000,000 in State funds from the CARB. This action was in response to the Governor’s statewide program to mitigate excess emissions from peaker power generation units. The Board has so far approved the expenditure of $23,497,462, on projects approved and recommended by CARB. Staff recommends the reallocation of $1,049,745 from two unexecuted contracts by Tudor and Cattrac Construction Companies for projects approved by the Board on September 21, 2001, and the expenditure of $1,579,579 from the State Emissions Mitigation Fund on a new round of emission reduction projects for a total of $2,629,324. (Review: Technology Committee, February 22, 2002)

10. Modify Contracts Executed Under FY 1999-00 Carl Moyer Program
Liu (909) 396-2105
cliu@aqmd.gov

Under the CARB’s FY 1999-00 Carl Moyer Program, ENRG (formerly Pickens Fuel Corporation) was awarded infrastructure development funding for five stations. Negotiations with two of those stations have been terminated. ENRG is requesting that the funding awarded for these two sites be transferred to two new sites for which contracts are being negotiated. The new sites meet or exceed the cost effectiveness and fuel throughput requirements set forth under the Carl Moyer Program. Staff recommends approval of a no-cost contract amendment allowing the Carl Moyer Funds to be used for these two new stations. (Review: Technology Committee, February 22, 2002)

11. Execute Contract to Cosponsor Development and Demonstration of One CNG-Powered Midsize School Bus and Demonstrate Two Smaller CNG School Buses
Liu (909) 396-2105
cliu@aqmd.gov

At present, major manufacturers commercially offer 40 foot school buses with alternative fuel engines, but none offer any alternative fuel midsize (approximately 30 foot) school buses. AQMD, in conjunction with the Ford Motor Company, ARBOC Ltd., and ENRG, Inc. will develop and demonstrate one 30 foot CNG-powered midsize school bus and demonstrate two smaller CNG-powered school buses. The Ford Motor Company is committed to commercializing technology developed under this proposed project, which will assist in lowering NOx and PM emissions from midsize school buses. Staff recommends AQMD's participation in an amount not to exceed $600,000 from the Clean Fuels Fund. Total funding for this project is $1,688,000. (Review: Technology Committee, February 22, 2002)

12. Execute Contract to Conduct Indoor and Outdoor Air Quality Study in Mira Loma Area
Hogo (909) 396-3184
hhogo@aqmd.gov

A special PM2.5 program is being conducted by the University of California at Riverside's College of Engineering - Center for Environmental Research and Technology (CE-CERT). The study includes chemical characterization of PM2.5 outdoors and within 20 homes and a school in the Mira Loma area. Mira Loma has been identified as the area with the highest ambient (outdoor) PM2.5 mass concentrations in the Basin. The total cost of the study is $360,000. The County of Riverside has awarded $310,000 to this project. This action is to execute a contract with CE-CERT for an amount not to exceed $35,000 and $15,000 in-kind technical analysis. Funds are available in the Clean Fuels Program. (Review: Technology Committee, January 25, 2002).

13. Appropriate Funds and Reissue RFQ to Purchase Gas Chromatograph/Mass Spectrometer System
Hogo (909) 396-3184
hhogo@aqmd.gov

On February 16, 2001, the Board recognized subvention funding from CARB and allocated funds for fixed asset purchases to improve laboratory analysis equipment. As part of the AQMD's compliance efforts, the laboratory routinely analyzes samples from point, fugitive, and area sources for VOC and other emissions. A gas chromatograph/mass spectrometer system (GC/MS) is essential for accurate sample analysis. This GC/MS will replace an instrument that is over 15 years old and will ensure continued capabilities to analyze these samples. The original RFQ was issued on August 17, 2001, but due to insufficient bids, staff recommends the reissuance of the RFQ. This action is to appropriate $120,000 from the Reserve for Subvention Compliance to the FY 2001-02 Budget and to reissue the RFQ for the purchase of the GC/MS. (Review: Administrative Committee, February 8, 2002)

14. Renew Contracts with Strategy Workshop and TLC MediaWorks for Media and Public Relations Services
Solomon (909) 396-3780
(msolomon@aqmd.gov)

On February 16, 2001, the Board authorized the execution of one-year contracts for media and public relations services with Strategy Workshop for an amount not to exceed $120,000 and TLC MediaWorks for an amount not to exceed $55,000. Both contracts expire March 9, 2002. Staff recommends renewing the Strategy Workshop contract for one year for an amount not to exceed $120,000, and the TLC MediaWorks contract for one year for an amount not to exceed $75,000. (Review: Administrative Committee, February 8, 2002)

15. Establish Classification and Add and Delete Positions
Tharp (909) 396-3018
(etharp@aqmd.gov)

To provide needed assistance and support to District Counsel, as proposed by the Board’s Personnel Committee, staff recommends (1) establishing the classification of Principal Deputy District Counsel, which may be used in either District Counsel's or District Prosecutor's offices; and (2) adding a Principal Deputy District Counsel and deleting a Senior Deputy District Counsel position in the District Counsel's office. Based on current fifth-step annual salaries, these actions would result in an annual increase of approximately $4,933. (Review: Administrative Committee, February 8, 2002)

16. Approve Contracts under Diesel Particulate Trap Retrofit 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
Kleindienst

In July 2001, as part of the FY 2001-02 AB 2766 Discretionary Fund Work Program, the Board approved release of a Program Announcement for a $1 million Diesel Particulate Trap Retrofit Program. The program began October 1, 2001 and ends September 30, 2002. Proposals totaling $1,615,000 were received within the first three weeks of the program. At this time, the MSRC requests approval of three projects totaling $994,500. The MSRC also requests authority to adjust contracts up to 5 percent and authority for the Board Chairman to execute agreements. The MSRC may allocate additional funds to the program depending on how much turn-back funds are received in the near future. If so, the MSRC will return to the Board for approval of additional projects at that time.

17. Approve AQMD Annual Investment Policy and Delegation of Authority to Appointed Treasurer to Invest AQMD Funds
Pearce (909) 396-2828
(rpearce@aqmd.gov)

State law requires a local government entity to annually provide a statement of investment policy for consideration at a public meeting and to renew its delegation of authority to its treasurer to invest or to reinvest funds of the local agency. (Review: Investment Oversight Committee, February 15, 2002)

Action Items/No Fiscal Impact

18. Ratify and Clarify Status of Board Committee to Facilitate Rulemaking on Refinery Control Measures FUG-04, FUG-05 and CMB-09
Glover

At the February 1, 2002 Board meeting, a committee consisting of Jane Carney and Leonard Paulitz was created to facilitate rulemaking on Refinery Control Measures FUG-04, FUG-05 and CMB-09. This action is to ratify that appointment and clarify that this committee is an ad hoc committee charged with only the specific task of facilitating the development of these control measures in a limited period of time.

Information Only - Receive and File

19. Public Affairs Report
Solomon (909) 396-3780
(msolomon@aqmd.gov)

This report highlights the January 2002 activities of the Public Affairs Office which includes the following: Environmental Justice Update, Community Events/Public Meetings, Business Assistance, Intergovernmental Affairs, Media Communications, and Transportation Programs.

20. Hearing Board Report
Camarena (909) 396-2500
(ecamarena@aqmd.gov)

This reports the actions taken by the Hearing Board during the period of January 1 through January 31, 2002.

21. Civil Filing and Civil Penalties Report
Mieras (909) 396-3400
(pmieras@aqmd.gov)

This reports the monthly penalties from December 1 through December 31, 2001, and legal actions filed by the District Prosecutor during the period January 1 through January 31, 2002. A glossary explaining the key terms and Index of District's Rules are attached with the penalty report.

22. Lead Agency Projects and Environmental Documents Received by the AQMD
Chang (909) 396-3186
(echang@aqmd.gov)

This report provides for the Board's consideration, a listing of CEQA documents received by the AQMD between December 1, 2001 and December 31, 2001, and those projects for which the AQMD is acting as lead agency pursuant to CEQA. (Review: Mobile Source Committee, February 22, 2002)

23. Rule and Control Measure Forecast
Chang (909) 396-3186
(echang@aqmd.gov)

24. Home Rule Advisory Group Annual Report
Chang (909) 396-3186
(echang@aqmd.gov)

This report summarizes the efforts undertaken in 2001 by the Home Rule Advisory Group. (Review: Stationary Source Committee, January 25, 2002)

25. Status Report on Mobile Source Pilot Credit Generation Rules
Chang (909) 396-3186
(echang@aqmd.gov)

In 2001, the Board adopted six pilot credit generation rules. As part of the adopted resolution, the Board directed staff to provide a status report on implementation of the pilot credit generation programs every six months. The status report includes information regarding EPA approval of the pilot credit generation rules, implementation of the rules, and generation and use of credits. (Review: Stationary and Mobile Source Committees February 22, 2002)

26. Notification of OEHHA's Finalization of Chronic Reference Exposure Levels
Chang (909) 396-3186
(echang@aqmd.gov)

The March 2000 amendments to Rule 1402 - Control of Toxic Air Contaminants from Existing Sources, require that staff notify the Board and affected parties when the state adds chemicals or changes risk values for Toxic Air Contaminants. In December 2001, the Office of Environmental Health Hazard Assessment finalized Chronic Reference Exposure Levels for 13 compounds. At the May 3, 2002 Board meeting, staff will propose amendments to Rule 1401 and report on potential impacts to facilities subject to Rules 1401 and 1402. (Review: Stationary Source Committee, February 22, 2002)

27. This item was moved to "Public Hearings"; see Item No. 44.

28. Report of RFPs and RFQs Scheduled for Release in March
Pearce (909) 396-2828
(rpearce@aqmd.gov)

This report summarizes the RFPs and RFQs for budgeted services over $50,000 scheduled to be released for advertisement for the month of March. (Review: Administrative Committee, February 8, 2002)

29. FY 2001-02 Contract Activity
Pearce (909) 396-2828
(rpearce@aqmd.gov)

The attached report lists the number of contracts let during the first six months of FY 2001-02, their respective dollar amounts, award type, and the authorized contract signatory for the AQMD.

30. Status Report on Major Projects for Information Management Scheduled to Start During Last Six Months of FY 2001-02
Marlia (909) 396-3148
cmarlia@aqmd.gov

Information Management is responsible for data systems management services in support of all AQMD operations. This action is to report on major automation contracts and projects to be initiated by Information Management during the last six months of FY 2001-02.

31. Items Deferred from Consent Calendar

32. Administrative Committee
Chair: Glover
Wallerstein (909) 396-3131
(bwallerstein@aqmd.gov)

33. Investment Oversight Committee
Glover
Pearce (909) 396-2828
(rpearce@aqmd.gov)

34. Legislative Committee
Chair: LaPisto-Kirtley
Solomon (909) 396-3780
(msolomon@aqmd.gov)

The Legislative Committee considered agenda items including the following draft federal Legislative Concepts for 2002 which the Board will consider for approval:

Concept #1 - Hydrogen Fueling Infrastructure Project

Concept #2 - Transition Assistance for Dry Cleaning Operations

Concept #3 - Natural Gas Engine Research, Demonstration, and Deployment

Concept #4 - Homeland Security/Air Contaminant Monitoring Equipment

35. Mobile Source Committee
Chair: Wilson
Chang (909) 396-3186
(echang@aqmd.gov)

36. Stationary Source Committee
Chair: Loveridge
Coy (909) 396-2434
(ccoy@aqmd.gov)

37. Technology Committee
Chair: Bernson
Liu (909) 396-2105
cliu@aqmd.gov

38. Mobile Source Air Pollution Reduction Review Committee
Board Liaison: Glover
Hogo (909) 396-3184
hhogo@aqmd.gov

39. California Air Resources Board Monthly Report
(No Written Material -: Transcripts of the meetings are available at CARB's web site, www.arb.ca.gov)
Board Rep: Burke
Dix (909) 396-2827
(jdix@aqmd.gov)

40. California Fuel Cell Partnership Steering Team Meeting
Board Rep: Paulitz
Liu (909) 396-2105
cliu@aqmd.gov

This report summarizes the California Fuel Cell Partnership meeting held January 29-30, 2002 in Sacramento. (Review: Technology Committee, February 22, 2002)

PUBLIC HEARINGS

41. Prehearing and Status Report on Controlling Volatile Organic Compound and Ammonia Emissions from Composting and Related Operations
(Staff will be recommending continuance to the April 5, 2002 Board Meeting)
Chang (909) 396-3186
(echang@aqmd.gov)

As part of the development of Proposed Rule 1133, staff has been evaluating methods to control emissions from composting operations. The 1999 amendment to the 1997 AQMP requires staff to report to the Board, at a public meeting, when cost-effectiveness for a draft rule/amendment may exceed $13,500 per ton of VOC reduced. The report must be presented at least 90 days prior to rule adoption and include viable control alternatives within the industry source categories intended to be regulated. This report fulfills this obligation and provides an update on recently completed source test, potential control technologies, effectiveness and cost, with recommended actions to reduce emissions from composting operations. (Review: Stationary Source Committee, December 7, 2001 and January 25, 2002)

42. Annual RECLAIM Audit Report for 2000 Compliance Year
Coy (909) 396-2434
(ccoy@aqmd.gov)

The annual report on the NOx and SOx RECLAIM program is prepared in accordance with Rule 2015 - Backstop Provisions. The report assesses emission reductions, average annual price and availability of RECLAIM Trading Credits (RTCs), job impacts, compliance issues and other measures of performance for the seventh year of this program. (Review: Stationary Source Committee, February 22, 2002)

43. Adopt Update of Technology Advancement Plan for Clean Fuels Program and Approve Technology Advancement Annual Report
Liu (909) 396-2105
cliu@aqmd.gov

SB 98 (Alarcon) amended and extended the Clean Fuels Program until January 1, 2005. Amendments under Health & Safety Code Section 40448.5.1 require the submittal of an Annual Report covering the past year’s Clean Fuels Program activities to the Legislative Analyst and air quality committees of the State Legislature by March 31, following Board approval. The law also requires the Board to adopt the Technology Advancement Plan for the current year. These documents have been accordingly prepared, reviewed and approved by the state-mandated Clean Fuels Advisory Group, and submitted for Board approval. (Review: Technology Committee, January 25, 2002)

44. Annual Report for 2001 on AB 2588 Air Toxics "Hot Spots" Program
Chang (909) 396-3186
(echang@aqmd.gov)

The Air Toxics "Hot Spots" Information and Assessment Act of 1987 requires local air pollution districts to prepare an annual report. This report summarizes the program progress over the 2001 calendar year. Highlights for last year include review and approval of 30 health risk assessments, holding of three public notification meetings, and consolidation of criteria and toxic emission reporting. Proposed activities for 2002 include the elimination of the health risk assessment backlog and development of public notification procedures for the industry-wide categories of retail gasoline stations, dry cleaners, and metal plating and finishers.

OTHER BUSINESS

45. Approve Memorandum of Understanding with SCAQMD Professional Employees Association
Tharp (909) 396-3018
(etharp@aqmd.gov)

AQMD management and representatives of SCAQMD Professional Employees Association (SC-PEA), representing the Professional Bargaining Unit, have reached agreement on a labor contract for the period July 1, 2002, through June 30, 2005, which has been ratified by bargaining unit members. This action is to present the ratified agreement to the Board for approval as a new three-year memorandum of understanding.

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

CLOSED SESSION

46. Closed Session (No Written Material)
Baird (909) 396-2302
(bbaird@aqmd.gov)

It is necessary for the Board to recess to closed session pursuant to Government Code section 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. It is also necessary for the Board to recess to closed session pursuant to Government Code section 54957.6(a) to meet with designated representatives regarding represented employee salaries and benefits or other mandatory subjects within the scope of representation [Negotiator: Eudora Tharp; Represented Employees: SCAQMD Professional Employees Association and Teamsters Local 911] and to meet with labor negotiators regarding unrepresented employees [Agency Designated Representatives: Barry Wallerstein and Eudora Tharp; Unrepresented Employees: Designated Deputies and Management and Confidential employees].

OPEN SESSION

47. Open Session (No Written Material)
Glover

Possible action following discussion in Closed Session concerning Designated Deputies and Management and Confidential employees.

AQIP = Air Quality Investment Program
CARB = California Air Resources Board
AVR = Average Vehicle Ridership
Cal/EPA = California Environmental Protection Agency
CEMS = Continuous Emissions Monitoring Systems
CEQA = California Environmental Quality Act
CE-CERT = College of Engineering-Center for Environmental Research and Technology
CNG = Compressed Natural Gas
CO = Carbon Monoxide
CTG = Control Techniques Guideline
EPA = Environmental Protection Agency
EV = Electric Vehicle
FY = Fiscal Year
HRA = Health Risk Assessment
IAIC = Interagency AQMP Implementation Committee
IGA = Intergovernmental Affairs
LAER = Lowest Achievable Emissions Rate
LEV = Low Emission Vehicle
LNG = Liquefied Natural Gas
MOU = Memorandum of Understanding
MSERCs = Mobile Source Emission Reduction Credits
MSRC = Mobile Source (Air Pollution Reduction) Review Committee
NESHAPS = National Emission Standards for Hazardous Air Pollutants
NGV = Natural Gas Vehicle
NO_x = Oxides of Nitrogen
NSPS = New Source Performance Standards
NSR = New Source Review
PAMS = Photochemical Assessment Monitoring Stations
PAR = Proposed Amended Rule
PM₁₀ = Particulate Matter < 10 microns
PM_2.5 = Particulate Matter < 2.5 microns
PR = Proposed Rule
RFP = Request for Proposals
RFQ = Request for Quotations
SCAG = Southern California Association of Governments
SIP = State Implementation Plan
SO_x = Oxides of Sulfur
TCM = Transportation Control Measure
ULEV = Ultra Low Emission Vehicle
VMT = Vehicle Miles Traveled
VOC = Volatile Organic Compound
ZEV = Zero Emission Vehicle