BOARD MEETING DATE: April 2, 2010
AGENDA NO. 19
REPORT:
Legislative Committee
SYNOPSIS:
The Legislative Committee held its regular meeting on Friday, March 12, 2010. The next Legislative Committee meeting is scheduled for Friday, April 9, 2010 at 9:00 a.m. in Conference Room CC8. The Committee deliberated on agenda items for Board consideration:
RECOMMENDED ACTION:
Receive, file this report, and approve positions on the bills as specified in this letter.
Jan Perry, Acting Chair
Legislative Committee
Attendance [Attachment 1]
The Legislative Committee met on March 12, 2010. Vice-Chair Jan Perry (who served as Chair of the Committee) and Committee Members, Marion Ashley and Dr. William Burke (who was appointed to the Committee for this meeting) attended via videoconference. Chair Jane Carney and Committee Member Michael Antonovich were absent.
Update on Federal Legislative Issues
Mr. Chris Kierig, AQMD federal legislative consultant, reported that a meeting has been scheduled with EPW Committee staff to discuss marine vessel policy issues. He also said that indications are that the ‘cap and trade program’ legislation is off the table for now because there is not enough support to pass it. Since health care has taken a high priority for the administration and has unresolved issues, he does not expect anything meaningful on climate change legislation to occur at this time.
Regarding appropriations, Mr. Kierig reported that the House Republican Caucus wants to ban all earmarks. Ms. Judy Lemons, AQMD federal legislative consultant, reported that she spoke with Chairman Obey and it is still unresolved in the Democratic Caucus whether or not they will decide to ban all earmarks in the House.
Andy Ehrlich, AQMD federal legislative consultant, reported that he is scheduling meetings for AQMD staff who will be traveling to DC soon. The meeting discussion topics will include: offsets, transportation, and goods movement, among others.
Mr. Ehrlich is also working on the DOE and U.S. EPA contractual issue involving previously awarded federal appropriation funds with the other consultants and AQMD staff. Mr. Ehrlich mentioned that the President had 11 Senators, consisting of five Republicans and six Democrats (including Kerry, Lieberman, and Graham), in the White House discussing energy and climate change issues, which is even more notable, considering that the health care issue is so prominent currently. If the Senate were to consider an energy or climate bill it would likely be after the Spring.
Mr. Ehrlich also stated that the U.S. EPA Administrator has written to nine Democratic Senators stating that they will not issue any final rules for regulation of greenhouse gases by stationary sources in calendar year 2010 and that regulations in 2011 might be less strict. Over the last couple of months, U.S. EPA has been feeling the political pressure from both parties to slow down the regulation of greenhouse gases from stationary sources. However, U.S. EPA’s vehicle emissions standards have been sent over to the White House for final approval in an attempt to meet an end of March deadline.
Update on State Legislative Issues
Mr. Will Gonzalez, AQMD state legislative consultant, gave an update on SBX8 37 (introduced by Senators Cedillo and Pavley). This bill seeks to remove the cost-effectiveness threshold for the Carl Moyer program for a one-year period in order to get Moyer funding moving more expeditiously and create more jobs. However, the bill did not move in the eighth extraordinary session and is currently dead. It is possible that the author may consider moving the bill into a regular session bill. Both AQMD and CAPCOA have offered amendments to the author.
Mr. Gonzalez reported that 2,100 bills were introduced (1,300 in the Assembly and 800 in the Senate) recently, and highlighted some bills that would be of interest to the District:
SB 1479 is the Senate Public Employees and Retirement Committee’s omnibus bill which will include AQMD’s language to allow the District to prepay its retirement contribution to SBCERA at a substantial cost savings.
SB 722, by Senator Simitian, is a re-introduction of his renewable portfolio standard bill of last year. The bill currently places significant restrictions on the utility’s ability to bring renewable power from outside of California. Prospects are not good as the Governor has already indicated that he would veto this bill. The Governor has asked CARB to use their authority under AB 32 to create its own RPS program.
On AB 32 related issues, an initiative that would suspend AB 32 implementation until unemployment drops below 5% has received major contributions from Valero and Tesoro and may now qualify for the November ballot.
Mr. Jason Gonsalves, AQMD state legislative consultant, reported that in the eighth extraordinary session the legislature addressed $5 billion of the $19 billion deficit. Budget discussions will continue throughout the year. Complicating the discussion is the attempt to include CEQA exemptions in the budget negotiations. Speaker Perez has stated that he is willing to look at potential streamlining of CEQA but outright exemptions are a non-starter.
The Senate Democratic Leadership has committed itself to take up part of the reform package proposed by California Forward. Some key proposals include:
Prohibit the state from borrowing local and regional funds
2 year budget instead of an annual budget system
Elimination of 2/3 vote requirement for budget
Mr. Gonsalves stated that the meetings in Sacramento have been very successful. They met with each of the members of the leadership as well as the Governor’s office.
Ms. Carolyn V. Hunter, AQMD state legislative consultant, also reported on the visits with leadership in Sacramento.
On energy matters, Ms. Hunter reported that SBX8 34, introduced by Padilla, originally drafted to expedite the approval of and site selection for, solar thermal power plants was amended to focus on mitigation measures and not on the process.
State Legislation Addressing Air District Enforcement of Odor Nuisances.
Mr. Kurt Wiese, General Counsel, presented this item, concerning the District’s enforcement of Public Nuisances caused by odors. Under the Health and Safety code section 41700, local air districts throughout the state are authorized to enforce public nuisances that affect a considerable number of persons or the general public.
Senator Rod Wright, approached the District with a concern regarding the method of enforcement of odor nuisances and the method of processing complaints regarding such nuisances. The concern was raised with Senator Wright by a group of foundries located in the Bay Area. In response, Senator Wright has asked the District for recommendations for specific language for the bill. What staff proposes to do is to codify the enforcement criteria that the South Coast District uses in enforcing odor nuisances.
Chair Jan Perry asked for staff’s recommendation regarding this issue.
Mr. Wiese recommended that the committee authorize staff to go back to Senator Wright and to the Foundries Coalition to work on developing a bill which will codify the District’s enforcement practices regarding odor nuisances.
Ms. Perry inquired if Senator Wright approached the District because he lives in our District. Mr. Wiese affirmed this, and added that staff had worked closely with him on SB 827 issues last year. Dr. Wallerstein stated that it was not uncommon for a legislative office to reach out to staff for technical information or input. He added that this also relates to environmental justice issues where the District has been very strong, from a policy perspective. The Committee concurred with continuing discussions with Senator Wright on this issue.
Recommend Position on State Bills
[Attachment 2]
Oscar Abarca, Deputy Executive Officer, Legislative & Public Affairs, briefed the Committee on the following state legislation:
AB 1740 (Jeffries) Vehicles: Specially Constructed Vehicles
The bill is sponsored by the Association of Car Clubs in California. This bill proposes to remove the existing 500 vehicle limitation cap for specially constructed vehicles and allow an unlimited number of such vehicles to be registered in accordance with the model year of the vehicle or the engine. The proposed revisions would increase the number of specially constructed vehicles that are registered under older model years and that would be therefore subject to less stringent emission standards. The proposed revisions would also increase the number of specially constructed vehicles that would not be subject to a biennial smog check. Staff is recommending an oppose position because this would cause an increase in criteria pollutant emissions.
The Legislative Committee approved staff’s recommendation to Oppose AB 1740.
AB 1863 (Gaines) Diesel Generators: Health Facilities
This bill is sponsored by the California Hospital Association. Existing law requires health facilities to test their diesel-powered backup generators on a monthly basis with testing intervals of not less than 20 days and not more than 40 days. However, these requirements will be repealed on January 1, 2011. This bill would extend the sunset date to January 1, 2016. Extension of the sunset date will allow the monthly testing to continue, as opposed to weekly. Staff believes extending the sunset date will decrease diesel emissions and reduce the exposure to toxic risks to the surrounding communities. AQMD staff recommends a support position.
The Legislative Committee approved staff’s recommendation to Support AB 1863.
SB 1433 (Leno) Air Pollution Penalties: Inflation Adjustments
This bill is sponsored by Breathe California and the Bay Area AQMD. This legislation would require the State Air Resources Board to adjust maximum civil and criminal penalties, as specified in the Health and Safety Code, based on the Consumer Price Index (CPI), and to publish the inflation-adjusted maximum penalties via its website. AQMD believes that such adjustments to the penalties will assist in stabilizing and achieving consistency in the economy and ensure that they act as an effective deterrent to the violation of air pollution control laws.
Chairman Burke asked if this would be a mandate, and Dr. Wallerstein replied that it would and that it is setting the ceiling on penalties, but that our prosecutors would still have the flexibility within the ceiling to determine the appropriate amount of penalties. There is also a two-year delay in implementing the bill. Dr. Wallerstein further stated that staff believes that this is a good bill which provides an alternative to less effective legislation dealing with the same issue.
AQMD staff recommended a support position on SB 1433.
The Legislative Committee approved staff’s recommendation to Support SB 1433.
Dr. Anupom Ganguli, Assistant DEO, Legislative & Public Affairs, briefed the Committee on the following state legislation:
AB 2289 (Eng) Smog Check Program: Testing: Penalties
This bill would provide authorization to develop new emissions test procedures for motor vehicles, allow management of smog check stations by additional entities, authorize referees to perform testing of vehicles presenting unusual inspection circumstances, and provide performance standards for test stations. This legislation will address major defects in the smog check program and will substantiate the emission reductions claimed for California’s Smog Check Program in the State Implementation Plan. AQMD staff recommended a support position on AB 2289.
Dr. Wallerstein stated that it was disclosed recently that there are major defects in the Smog Check program. AQMD depends on the Smog Check program for emission reductions contained in the Air Quality Management Plan. This legislation represents the state administration’s efforts to fix this program for air quality improvements.
Chairman Burke asked if this effort was due to fraud in the program. Dean Saito, Fleet Rule Implementation Manager, Science & Technology Advancement, replied in the affirmative and stated that the Air Resources Board and the Bureau of Automotive Repair recently released a report that indicated 70 tons per day emissions reductions shortfall in California from the Smog Check program, as referenced in the State Implementation Plan. This bill would eliminate the 70 tons per day emissions reductions shortfall.
The Legislative Committee approved staff’s recommendation to Support AB 2289.
AB 2691 (Hill) California Global Warming Solutions Act of 2006: Fees
The bill is sponsored by the California Manufacturers & Technology Association. This bill affects market compliance mechanisms and fee regulations, with respect to greenhouse gases, by prohibiting air districts and other local government entities from charging fees for greenhouse gases to any source covered under a market mechanism adopted by CARB for greenhouse gases pursuant to AB 32.
This bill would prevent air districts from charging a fee to sources that would otherwise be subject to AQMD regulations and requirements. CAPCOA has taken an oppose position on this bill. Staff believes that local air districts have a proper role in the reporting, administration and enforcement of greenhouse gas regulations. Because the details of the compliance mechanisms and fee regulations have not been developed by CARB, staff believes that it is premature to pursue a “blanket” prohibition on air districts and other local government entities from collecting greenhouse gas emissions fees, and therefore recommends a position of oppose.
Dr. Wallerstein stated that the federal program on greenhouse gas regulation is still evolving. The federal government is asking local air districts to implement part of that program. Staff is concerned that this bill could impose a prohibition on the AQMD from being able to establish cost-of-service fees, and to be able to recoup expenses for federally mandated programs.
The Legislative Committee approved staff’s recommendation to Oppose AB 2691.
AB 2037 (M. Perez and Salas) Electricity: Air Pollution
The bill is sponsored by the County of Imperial. This bill would allow air districts to participate in the decision-making process for the site selection or expansion of an electrical generating facility. The bill prohibits publicly-owned electric utilities from entering into long term power contracts with energy plants which lack certification, do not meet air pollution standards, and that will contribute to the nonattainment of state or federal air quality standards. This bill will also prohibit the California Public Utilities Commission (CPUC) from approving long-term contracts unless the administering local air agency makes certain air quality related findings.
The bill is aimed at preventing utilities from entering into contracts with energy plants built just across the international border with Mexico, thereby avoiding health-protective air quality emissions standards. The pollution from those plants do not respect the border and impact the communities on the California side, while the plant operators profit from the sale of electricity.
AB 2037 is intended to address air pollution transport by authorizing the CPUC to only approve energy contracts with power plants that meet California emissions and offsets standards. Staff believes that this legislation will allow local air districts to determine the impacts of developing electrical generating facilities on the attainment of air quality standards, which is in the best interest of local air quality. Staff recommends a position of support.
The Legislative Committee approved staff’s recommendation to Support AB 2037.
SB 1114 (Florez) Emission Reduction Credits: Private and Public Moneys –
This bill would authorize an air district to create emission reduction credits from marine vessel or locomotive emission reductions funded by both public and private funds, under certain conditions. This bill would also create the Emission Reduction Sales Fund and will remain in effect only until January 1, 2015. SB 1114 is a complex bill that, though well intended, has a significant potential for being problematic, given the number of unknown factors identified within the staff’s analysis.
On the positive side, this bill is intended to incentivize the marine vessel and locomotive industries to invest in emission reducing technologies and be reimbursed for that investment by the sale of the emission reduction credits that are thereby generated. However, as the bill analysis points out, the legislation has serious implications for the Carl Moyer Program, may result in credits generated in our region to be used to fund projects in other portions of the state, and inadvertently result in a net growth in emissions.
Because of these significant issues, staff recommends to WORK WITH AUTHOR TO CLARIFY PROVISIONS AND REPORT BACK IN 30 DAYS.
The Legislative Committee approved staff’s recommendation to work with the author to clarify provisions and to report back in 30 days.
SB 1194 (Hollingsworth) Air Pollution Control Districts: Residential Wood-Burning Devices
This bill overturns provisions of AQMD’s Rule 445 by not permitting air districts from adopting or implementing rules that prohibit the installation of wood-burning fireplaces, stoves and heaters in new or existing residential structures. If passed and signed into law, this bill would forego the 1.0 ton per day emissions reduction from AQMD Rule 445, which is a key part of the AQMP control strategy to achieve the federal 2015 PM2.5 air quality standard. However, it would not prevent the wood burning curtailment program as the bill does not limit the authority of air districts to regulate the operation or use of existing wood-burning fireplace. Staff recommends an oppose position.
The Legislative Committee approved staff’s recommendation to Oppose SB 1194.
Home Rule Advisory Group Committee Legislative Report
[Attachment 3]
Please refer to Attachment 3 for a written report.
Other Business: None
Public Comments: None
Attachment (EXE, 1.3m)
Attendance Roster
Bill Language and AQMD Bill Analyses
Report from AQMD Home Rule Advisory Committee