BOARD MEETING DATE: October 2, 2009
AGENDA NO. 34

REPORT:

Legislative Committee

SYNOPSIS:

The Legislative Committee held its regular meeting on Friday,
September 18, 2009. The next Legislative Committee meeting is scheduled for Friday, October 9, 2009 at 8:00 a.m. in Conference Room CC8. The Committee deliberated on agenda items including the following legislation for Board consideration:

Bill/Title	Recommended Position
H.R. 3367 (Levin) Heavy Duty Hybrid Incentives Improvement Act of 2009.	Support

 

RECOMMENDED ACTION:

Receive, file this report, and approve positions on the bills specified in this letter.
 

Jane W. Carney, Chair
Legislative Committee

Attendance [Attachment 1]
The Legislative Committee met on September 18, 2009. Committee Chair Jane Carney, Dr. Joseph Lyou, and Mayor Dennis Yates (who was appointed to the Committee for this meeting) were present. Committee Members Michael Antonovich and Jan Perry were present via videoconference.

Recommend Positions on the following federal bill [Attachment 2]
Dr. Pom Pom Ganguli briefed the Committee on H.R. 3367 (Levin) Heavy Duty Hybrid Incentives Improvement Act of 2009.

H.R. 3367 (Levin) extends the tax credit for hybrids by an additional five years and also makes heavy duty hybrids eligible for the tax credit. Absent the bill, the tax credit is scheduled to sunset this year.
Staff recommends supporting this bill as it has a positive effect on air quality, as shown in the staff analysis. Dr. Wallerstein added that this bill supports the development and deployment of heavy-duty hybrid vehicles being supported by a recent Department of Energy award under the American Recovery & Reinvestment Act program funding. Dr Ganguli noted there was no opposition to the bill.

The Legislative Committee recommended to Support H.R. 3367 (Levin).

Update on Federal Legislative Issues

Mr. Kadesh reported that the climate change bill has taken a back seat to health care reform. Chairman Boxer has indicated that she would still like to introduce her bill by the end of the month. The committee staff director is reviewing the recommendations that staff provided.

Mr. Kadesh stated that the surface transportation bill was initially going to move this year; however, they are now simply negotiating for a three month extension of the current highway trust fund with the possibility of an eighteen month extension. Negotiations will not begin in earnest on a new surface transportation bill until next year.

Mr. Kadesh reported that the interior appropriation bill is on the floor. Senator Lisa Murkowski, ranking member of the Energy Committee, is proposing an amendment to the interior bill that would prohibit, in most cases, the EPA from being able to regulate stationary sources of greenhouse gases.

Mr. Chris Kierig stated that the interior appropriation bill currently has $5 million allocation for the AQMD which they are attempting to expand to $7.5 million for diesel emissions reductions.

Update on State Legislative Issues [Attachment 3]
Dr. Wallerstein briefed the committee on the four bills that are related to the AQMD permit moratorium.

Dr. Wallerstein reported that AB 1318 (Perez) passed both houses of the legislature and is on the Governor’s desk for signature. The bill requires AQMD to provide offsets to the Sentinel power plant in the Coachella Valley. This is the only large power plant under any of the bills that would be allowed to call upon the bank for new construction. In addition, the bill requires the State Air Resources Board to do a power needs assessment for the region, which incorporates issues including AB 32, once through cooling, renewable portfolio standard, energy efficiency policies of the state, and the offset credit issue. The language requires the study to be conducted in consultation with the CEC, CAL-ISO, CPUC and the Water Resources Board (due to the once through cooling issue).

Dr. Wallerstein reported that SB 388 (Calderon) was a “gut and amend” bill on the last day of the session. This bill is a carbon copy of AB 1318 (Perez), but instead of the Sentinel power plant the bill provides credits to the Walnut Creek Mission Energy project, which is the second of three projects that Edison has approved through the PUC. The bill language is very specific, stating that the project has to have PUC approval and be located in the City of Industry. Dr. Wallerstein added that this is a ‘single power plant bill’ and is held on the Senate floor, making it a two-year bill.

Dr. Wallerstein reported that SB 827 (Wright) (formerly SB 696) had a “gut and amend” in the Assembly due to some procedural issues. SB 827 does not include any large new power plants but addresses the permit moratorium issue for essential public services, small businesses and other facilities exempt under Rule 1304. The bill provides credits for any exemptions within AQMD Rules 1304 and 1309.1, prior to the Board’s amendments that allowed power plants to call upon Rule 1309.1. The bill is currently at the Governor’s desk for signature.

Dr. Wallerstein reported that SB 579 (Lowenthal) went to the Assembly floor, but is currently being held at the desk. There are two main policy differences in SB 579 (Lowenthal) and SB 827 (Wright), despite the fact that they look identical in many respects. The first difference is that SB 579 still contains an urgency provision. The second and main policy difference is that the bill has proposed language by the plaintiffs that states in issuing credits under the bill AQMD can only rely upon the old tracking system that existed prior to Rule 1315. This bill awaits potential action in the assembly and we expect to address this bill next year. Staff does not believe that SB 579 solves the permit moratorium.

Dr. Lyou requested that staff provide the board with the number of credits currently in the bank for each pollutant.

Dr. Wallerstein commended the legislative team, staff, and consultants who worked very hard on this legislation and did a remarkable job.

Bill Lamar congratulated staff on their tireless efforts on this legislation. Mr. Lamar expressed his concern that small businesses applying for permits and offsets could face uncertainties midway through the process, due to the fact that SB 827 (Wright) sunsets in 2012. Mr. Lamar further noted that small businesses are hoping that there will be a more permanent fix for the permit moratorium issue.

Greg Adams thanked the staff on behalf of essential public services for their efforts on SB 827 (Wright).

Kris Flaig speaking on behalf of essential public services thanked staff for their efforts. Mr. Flake informed the committee of their support and willingness to continue to resolve Rule 1315 issues in a positive manner.

AQMD consultant Will Gonzalez completed the legislative update. He reported that AB 892 (Furutani), AQMD’s sponsored legislation regarding Proposition 1B “turnback” funds, received great bipartisan support and is on the Governor’s desk for signature. Mr. Gonzalez stated that all indications are that the Governor will sign the bill.

Regarding the renewable energy, Senator Negrete-Mcleod’s ‘feed in-tariff’ legislation (SB 32) had many challenges, but eventually received bipartisan support and is currently sitting on the Governor’s desk as well.

Issue RFP for Legislative Representation in Sacramento, CA
This item was also heard at the Administrative Committee meeting on September 18, 2009. Refer to October 2, 2009 Board Agenda item #14 for additional information on this item.

The Legislative Committee unanimously recommended issuing the RFP for Legislative Representation in Sacramento, CA.

Update on the American Clean Energy and Security Act of 2009 [Attachment 4]
Due to lack of time, the update on the American Clean Energy and Security Act of 2009 (Waxman/Markey bill) was tabled to the next Legislative Committee meeting on October 9, 2009.

Home Rule Advisory Group Committee Legislative Report [Attachment 5]
Written Report

Public Comments
None

Attachments (EXE, 1.13m)
1. Attendance Roster
2. H.R. 3367 Levin – Heavy Duty Hybrid Incentives Improvement Act of 2009
3. State Bills
- SB 827 (Wright)
- SB 579 (Lowenthal)
- AB 1318 (Perez)
- SB 388 (Calderon)
4. Update on the American Clean Energy and Security Act of 2009 (Waxman/Markey Bill)
5. Report from AQMD Home Rule Advisory Committee