BOARD MEETING DATE: September 11, 2009
AGENDA NO. 22

REPORT:

Legislative Committee

SYNOPSIS:

The Legislative Committee held its regular meeting on Friday, July 17, 2009. The next Legislative Committee meeting is scheduled for Friday, September 18, 2009 at 8:00 a.m. in Conference Room CC8. The Committee deliberated on agenda items including the following state legislation for Board consideration:

Bill/Title	Recommended Position
AB 1527 (Lieu) Motor Vehicle Emission Reduction Projects	Support with amendments
AB 1404 (De Leon) California Global Warming Solutions Act of 2006: Offsets	Support in concept with amendments

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 July 17, 2009. Committee Chair Jane Carney and Dr. Joseph Lyou were present. Committee Members Michael Antonovich, Jan Perry, and Dr. Roy Wilson were present via videoconference.
 

Update on Federal Legislative Issues
Mark Kadesh, AQMD federal legislative consultant, reported that Senator Boxer has postponed marking up the climate change legislation in the Environmental Public Works (EPW) Committee until the end of September which will allow AQMD staff to continue to provide input into the legislation.

Regarding marine vessel emission policies, Senator Boxer obtained the commitment of the USEPA Administrator to work on the issue and provide her with a few options. To help prompt the USEPA into action, the EPW Committee will also be working on its own analysis.

On the transportation bill, its markup has also been postponed, but the language reflects significant input from AQMD legislative staff. In the meantime, both Senator Boxer and Chairman Oberstar in the House have indicated that they want an 18-month extension of the current Highway Trust Fund.

In regards to Diesel Emissions Reduction Action (DERA) funding, Senate appropriations has continued funding for DERA at the current levels, but all appropriations bills are on hold pending resolution of health care reform.
 

Update on Federal Surface Transportation Legislation [Attachment 2]
Marc Carrel, Program Supervisor in Legislative & Public Affairs, reminded the Committee that at its March meeting it had adopted a series of legislative proposals for the surface transportation bill. He reported that the bill released by Chairman Oberstar incorporated many of the concepts requested by this Committee.

Dr. Barry Wallerstein requested that staff provide the Committee with a summary table of what AQMD requested and what is in the bill, and to have the summary included in the Committee report to the Governing Board.
 

Discussion of the Waxman-Markey Clean Energy and Security Act of 2009 as it pertains to Power Plants [Attachment 3]
Jill Whynot, Director of Strategic Initiatives, reported that this complex bill has been significantly amended and is now 1400 pages long. Essentially, the bill imposes some basic requirements for all power plants related to combined energy efficiency and increasing renewable energy standards. Beginning in the year 2012, six (6) percent of electricity generated must be from renewable sources. By 2020 up to twenty (20) percent must be achieved through a combination of energy efficiency or renewable energies. The bill additionally requires specific performance standards for coal-fired power plants and establishes a cap-and-trade program for CO₂. Dr. Lyou noted that California utilities will be controlled by the more stringent renewable portfolio standard (RPS) requirements under California law.

A summary of the bill from the National Association of Clean Air Agencies (NACAA) is attached. In addition, Chair Carney requested a generalized presentation of the bill at the September Committee meeting.
 

Update on State Legislative Issues
Dr. Barry Wallerstein reported that the legislative team has continued to work on SB 696 (Wright). Dr. Wallerstein along with staff met with Senator Wright and communicated to him the most recent Board discussions regarding power plants.

Dr. Wallerstein reported on the progress of AB 1318 (Perez). The bill would allow offsets for essential services and require AQMD to provide offsets to the Sentinel power plant in the Coachella Valley. The bill is now in Senate Rules Committee awaiting assignment.

Will Gonzalez gave an update on AB 892 (Furutani), AQMD’s sponsored legislation regarding Proposition 1B “turnback” funds. The bill passed the Assembly and the Senate Transportation Committee. Staff will start having conversations soon with the governor’s office.

Regarding renewable energy legislation, Senator Negrete-Mcleod’s feed in-tariff legislation (SB 32) continues to move forward. Recently, Assemblyman Fuentes gutted and amended his AB 1106 bill along similar lines and it is now anticipated that the two bills will be joined. Renewable Portfolio Standard (RPS) legislation on the other hand is seeing increasing opposition. The two leading bills, AB 64 (Krekorian) and SB 14 (Simitian), are being opposed by environmentalists, developers, and utilities. Labor is also opposing the bills because they believe the bills’ preference for out-of-state power production would take jobs out of California.

Paul Gonsalves, Sacramento legislative consultant, updated the Committee on the budget and emphasized that there are no impacts to air quality funding in this year’s budget.

Dr. Lyou asked what would happen if legislation starts moving between now and the next meeting of the Legislative Committee in September. Dr. Wallerstein stated that if staff didn’t have enough guidance from previous positions from the Board, a special meeting of the committee would be called.
 

Recommend Positions on the following state bills [Attachment 4]
Dr. Pom Pom Ganguli briefed the Committee on AB 1527 (Lieu) Motor Vehicle Emission Reduction Projects and AB 1404 (De Leon) California Global Warming Solutions Act of 2006: Offsets.
 

AB 1527
Staff recommended supporting this bill with amendments, as shown in the staff analysis.

The bill encourages projects that meet the requirements of Prop 1B and the Carl Moyer program, to apply and receive additional grants from multiple funding sources to achieve further incremental emission reductions.

The Legislative Committee recommended to Support AB 1527 with Amendments.
 

AB 1404
Staff recommended supporting this bill in concept with amendments, as shown in the staff analysis.

This bill would limit the use of "compliance offsets" to 10% of the greenhouse gas (GHG) emission reductions expected from market mechanisms used to meet GHG reduction goals of the Global Warming Solutions Act of 2006 (AB 32). It would also give priority to offsets that benefit air quality in-state, and particularly within communities disproportionately impacted by air pollution and to offsets in the same air district where they will be used. The recommendation to “support in concept” is recommended by staff because although they support the intent of the bill, they are uncertain as to what the appropriate percentage limit should be.

Staff further recommends amendments to ensure that compliance offsets do not cause or contribute to adverse effects on health or the environment and to allow local air districts to participate with CARB in developing protocols and being third-party verifiers. Dr. Lyou also requested amendments to the definition of compliance offsets to ensure that they be real, quantifiable, verifiable, and enforceable.

The Legislative Committee recommended to Support AB 1404 in Concept with Amendments.
 

Issue RFP for Legislative Representation in Washington D.C. [Attachment 5]
Dr. Ganguli stated that the contract for the federal consultants expires in January 2010, and due to the lead time needed to publicize, review, interview and have the committee recommend and the Board approve a consultant in a timely fashion, staff recommends the release of the RFP. Total expenditure remains unchanged from the current year.

Dr. Wallerstein noted that he added a clarification of Section 185 of the Clean Air Act in the RFP’s list of legislative priorities. Dr. Lyou suggested the following language change to the RFP’s list of legislative priorities: “6. Seek, revise, or clarify Section 185 of the Clean Air Act to reflect current conditions in the region including promoting equity among emission sources”. The same language should be reflected on pg 2 of the Federal RFP Board Letter. Dr. Wallerstein stated staff would make the change. Dr. Lyou’s recommended language change will be incorporated into the RFP board letter for September’s Board Meeting.

Chair Carney requested that staff bring proposed legislative goals and objectives for 2010 before the Committee prior to Committee interviews of potential consultants.

The Legislative Committee recommended issuing the RFP for legislative representation in Washington, D.C. with Amendments

(This item was also heard at the Administrative Committee meeting on July 17, 2009.)
 

Public Comments

No Public Comments
 

Attachments (EXE, 1.2m)

1. Attendance Roster
2. Comparison of AQMD Proposals to STAA
3. NACAA Presentation on Waxman-Markey Bill
4. State Bills:
   - AB 1527 (Lieu)
   - AB 1404 (De Leon)
5. Issue RFP for Legislative Representation in Washington D.C.
6. Report from AQMD Home Rule Advisory Committee