Date: February 6, 2013 to: Transportation Policy Committee (tpc) from

Take a position on SB 11 (Pavley/Rubio) and AB 8 (Perea/Skinner) (the Bills), companion bills proposed in the California Senate and Assembly regarding the State’s alternative fuel and vehicle technologies funding programs.

The Bills would extend various alternative fuel and technology programs statewide to improve air quality and lower greenhouse gas (GHG) emissions. The Bills propose to:

• 
  Renew funding from AB 118, the Air Quality Improvement Program (AQIP), slated to expire in 2014. The AQIP, established by the California Alternative and Renewable Fuel, Vehicle Technology, Clean Air, and Carbon Reduction Act of 2007, is a voluntary incentive program with oversight from the Air Resources Board, designed to fund alternative fuel investments including research, staff training and infrastructure. Annually the AQIP gives $200 million statewide for various renewable fueling projects.
  
• 
  Extend the Carl Moyer and AB 923 Incentive Programs until the year 2024 (currently the Programs expire at the beginning of 2015).
  
  • 
    Established in 1998, the Carl Moyer Memorial Air Quality Standards Attainment Program (Carl Moyer Program) provides funding for engines and equipment that exceed clean air industry requirements. Local air districts, along with the Air Resources Board monitored grant recipient practices, ensuring that the Program reduced pollution and improved California’s air. Eligible projects include cleaner on-road, off-road, marine, locomotive, lawn & garden, light duty passenger vehicles being scrapped and agricultural equipment.
    
  • 
    AB 923, implemented in 2005, expanded funding for the Carl Moyer Program, increasing the tire fee from $0.75 to $1.50 and allowing air districts to increase DMV vehicle registration fees from $4 to $6 for specified projects. AB 923 broadened the parameters of the Carl Moyer Program to include agricultural sources, light and medium-duty vehicle projects, and projects that reduce only particulate matter or only reactive organic gases (previously all projects had to reduce nitrogen oxides).
    
• 
  Delay implementation of the low carbon fuel standard (LCFS) until 2018. The LCFS was intended to ensure that 100 hydrogen-fueling stations would be built to sustain the more than 25,000 hydrogen fuel cell vehicles anticipated in California by 2024. In lieu of implementing the LCFS, the Bills explicitly earmark $20 million to build the stations. The delay represents a compromise with large petroleum companies to provide more time to gain better technology at a lower cost to the manufacturers and consumers.
  
• 
  Require the State Energy Resources Conservation and Development Commission, in partnership with the State Air Resources Board to develop and adopt a plan to increase the use of alternative transportation fuels and report out to the public every two years on its progress.
  
• 
  Extend the smog abatement fee and the vehicle / vessel registration fee increases in the amounts required to make these deposits into the Alternative and Renewable Fuel and Vehicle Technology Fund, the Air Quality Improvement Fund, and the Enhanced Fleet Modernization Subaccount until January 1, 2024.
  

The Leadership Group has not taken a position on the bills mentioned above (AB 118, AB 923 or the Carl Moyer Program). In 2012, a bill similar to the Bills was introduced to the state legislature (SB 1455), but it was not enacted. SB 1455 gained support from over 130 California companies, Silicon Valley Leadership Group members, organizations and government regulatory agencies. Supporters of SB 1455 include: ChargePoint, Bay Area Air Quality Management District, California Air Resources Board, Tesla and BAE Systems.

The Bills would continue tested programs to reduce the environmental and health impact of our transportation system through targeted reduction of air pollution and GHG emissions. They also align with the TPC 2013 Work Plan’s green vehicles and technology priorities by increasing electric vehicle infrastructure and hydrogen fuel cell stations. Extending the Carl Moyer Program would also help with the Leadership Group’s efforts to electrify Caltrain, as purchasing new electric cars would be an eligible expense (due to pollution reduction). As the TPC is well-aware, electrification of Caltrain will improve the system’s service and fiscal position.

SB 11 has been referred to the Senate Committees on Transportation & Housing and Environmental Quality (no hearing date as of 1/30/2013). AB 8 has been referred to the Assembly Committees on Transportation and Natural Resources (hearing date: 2/4 in the Transportation Committee).