BOARD MEETING STATE OF CALIFORNIA AIR RESOURCES BOARD SAN JOAQUIN VALLEY UNIFIED AIR POLLUTION CONTROL DISTRICT 1990 EAST GETTYSBURG AVENUE BOARD ROOM FRESNO, CALIFORNIA THURSDAY, OCTOBER 28, 2004 9:00 A.M. JAMES F. PETERS, CSR, RPR CERTIFIED SHORTHAND REPORTER LICENSE NUMBER 10063 PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 ii APPEARANCES BOARD MEMBERS Dr. Alan Lloyd, Chairperson Ms. Dorene D'Adamo Supervisor Mark DeSaulnier Dr. Henry Gong Ms. Lydia Kennard Mayor Ronald Loveridge Ms. Barbara Patrick STAFF Ms. Catherine Witherspoon, Executive Officer Mr. Tom Cackette, Chief Deputy Executive Officer Mr. Michael Scheible, Deputy Executive Officer Ms. Lynn Terry, Deputy Executive Officer Ms. Diane Johnston, General Counsel Ms. Kathleen Tschogl, Ombudsman Mr. Robert Barham, Assistant Chief, Stationary Source Division Ms. Merrin Bueto, Regulatory Assistance Section Mr. Michael Carter, Chief, Emission Research & Regulatory Development Branch Mr. Bob Cross, Chief, Mobile Source Control Division Mr. John DaMassa, Chief, Modeling and Meteorology Branch PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 iii APPEARANCES STAFF Mr. Bob Fletcher, Chief, Planning and Technical Support Division Mr. Kurt Karperos, Manager, Transportation Strategies Group Ms. Renee Kemena, Manager, Planning & Regulatory Development Section Mr. Jack Kitowski, Chief, On-Road Controls Branch Mr. Earl Landberg, Air Pollution Specialist, Planning and Regulatory Development Section Mr. Aron Livingston, Staff Counsel Ms. Jackie Lourenco, Manager, Off-Road Controls Section Ms. Cynthia Marvin, Chief, Air Quality and Transportation Planning Branch Mr. Rob Oglesby, Legislative Director Mr. George Poppic, Senior Staff Counsel Mr. Ravi Ramalingam, Staff Air Pollution Specialist Mr. Andrew Spencer, Staff, Off-Road Controls Section Mr. Mike Tollstrup, Chief, Project Assessment Branch Mr. Peter Venturini, Chief, Stationary Source Division Ms. Beverly Werner, Manager, Regulatory Assistance Section ALSO PRESENT Ms. Diane Bailey, Natural Resources Defense Council Mr. John Beyer, United States Department of Agriculture Mr. David Crow, San Joaquin Valley Unified Air Quality Control District PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 iv APPEARANCES CONTINUED ALSO PRESENT Mr. Manuel Cunha, Nisei Farmers League Mr. Teresa De Anda Mr. Sean Edgar, Clean Fleets Coalition Ms. Dawn Friest, Engine Manufacturers Association Ms. Staci Heaton, California Trucking Association Ms. Gretchen Knudsen, International Truck and Engine Corporation Mr. David Mager, Bion Dairy Corporation Mr. Brent Newell, El Comite Para El Bienestar de Earlimant and Association of Irritated Residents Mr. Richard Penna, National Marine Manufacturers Mr. Paul Roberts, Sonoma Technology, Incorporated Ms. Stephanie Williams, California Trucking Association Mr. Paul Wuebben, South Coast Air Quality Management District PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 v INDEX PAGE Pledge of Allegiance 1 Roll Call 1 Opening remarks by Chairperson Lloyd 2 Item 04-9-1 5 Chairperson Lloyd 5 Executive Officer Witherspoon 6 Staff Presentation 7 Board discussion & Q&A 32 David Crow 48 David Mager 50 Manuel Cunha 56 Diane Bailey 78 Brent Newell 86 Teresa De Anda 102 John Beyer 106 Sean Edgar 109 Board discussion 113 Motion 113 Vote 116 Item 04-9-2 116 Chairperson Lloyd 116 Staff Presentation 117 Board discussion & Q&A 132 Afternoon Session 144 Item 04-9-3 144 Chairperson Lloyd 144 Executive Officer Witherspoon 144 Staff Presentation 145 Board discussion & Q&A 161 Richard Penna 162 Paul Roberts 175 Board discussion & Q&A 182 Item 04-9-5 184 Chairperson Lloyd 184 Executive Officer Witherspoon 186 Staff Presentation 187 Board discussion & Q&A 200 Paul Wuebben 201 Gretchen Knudsen 205 PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 vi INDEX CONTINUED PAGE (Item 04-9-5 continued) Staci Heaton 212 Stephanie Williams 220 Dawn Friest 227 Board Discussion & Q&A 233 Item 04-9-4 238 Chairperson Lloyd 238 Chief Deputy Executive Officer Cackette 239 Staff Presentation 239 Board discussion & Q&A 249 Public Comment 249 Adjournment 250 Reporter's Certificate 251 PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 1 1 PROCEEDINGS 2 CHAIRPERSON LLOYD: Good morning. 3 The October 28th, 2004, public meeting of the Air 4 Resources Board will now come to order. 5 Ms. D'Adamo, would you please lead us in the 6 Pledge of Allegiance. 7 (Thereupon the Pledge of Allegiance was 8 Recited in unison.) 9 CHAIRPERSON LLOYD: Thank you very much. 10 The Clerk of the Board, please call the roll. 11 BOARD CLERK ANDREONI: Ms. Berg? 12 Ms. D'Adamo? 13 BOARD MEMBER D'ADAMO: Here. 14 BOARD CLERK ANDREONI: Supervisor DeSaulnier? 15 BOARD MEMBER DeSAULNIER: Here. 16 BOARD CLERK ANDREONI: Dr. Gong? 17 BOARD MEMBER GONG: Here. 18 BOARD CLERK ANDREONI: Ms. Kennard? 19 BOARD MEMBER KENNARD: Here. 20 BOARD CLERK ANDREONI: Supervisor Patrick? 21 BOARD MEMBER PATRICK: Here. 22 BOARD CLERK ANDREONI: Mrs. Riordan? 23 Supervisor Roberts? 24 Ms. Pineda? 25 Mayor Loveridge? PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 2 1 Chairman Lloyd? 2 CHAIRPERSON LLOYD: Here. 3 Well, good morning. It's great to be in Fresno 4 and great to be coming back here. Thank you so much for 5 the hospitality. I'm going to turn it over to Barbara in 6 a minute. She'd like to say a few words of welcome. 7 Really appreciate the staff. Great reception we had last 8 evening. And We look forward to today. 9 It's always nice to come down here. This is the 10 second day for us. Several of us went down yesterday and 11 had a tour with Roger Isom and Manuel Cunha of cotton 12 ginning and almond packaging and crushing. And, again, I 13 think it was very educational for us and to me. It's 14 always I think a dramatic demonstration of the diversity 15 of California and the wonder opportunities we have. So 16 it's both inspiring, and we also see it can be 17 challenging. And Bob Fletcher and I noticed along the way 18 obviously there's still continued growth in various areas 19 too, which is very important. 20 And of course from Manuel we also heard that 21 things weren't necessarily doom and gloom, but there are 22 certain aspects of agriculture which are thriving. 23 But it meant a lot. And, again, I would like 24 also to compliment the staff, from what we heard 25 yesterday, that the relationship between the community in PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 3 1 this part of the world -- the agricultural community and 2 the staff has improved substantially. So I want to thank 3 Catherine and all the staff for the great job you're doing 4 there. So it was very nice to hear that. Because we 5 recognize the challenge that we all have. 6 I would also like to, again, turn it over to 7 Barbara. She would like to say a few words of welcome 8 since it's your hometown. 9 BOARD MEMBER PATRICK: Absolutely. Thank you on 10 behalf of the Governing Board of the San Joaquin Air 11 District, I'd like to welcome well everybody here and all 12 the folks from Sacramento. This is really a wonderful 13 partnership that we have between the Air Resources Board 14 and our local folks. 15 As you learned yesterday, the ag community's 16 working hard to clean up the air, and it's become an 17 enormously important issue to all of our constituents 18 here. And we're working hard and you all are helping us 19 to reach attainment. And we're anxious to show off and 20 talk about our own attainment plan. 21 CHAIRPERSON LLOYD: Thank you very much. 22 And also at this Board meeting we have two of our 23 new Board members. At the last meeting we had three of 24 the new five, ones appointed by Governor Schwarzenegger. 25 So at this time I'd like to welcome and PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 4 1 introduce -- a great pleasure to introduce Lydia Kennard, 2 one of the new members appointed by Governor 3 Schwarzenegger. 4 I'll give her an opportunity to say a few words. 5 BOARD MEMBER KENNARD: Thank you, Alan. And good 6 morning to all of you. This is very exciting for me to be 7 at my very first Board meeting here in Fresno. 8 I actually spent my summers in the San Joaquin 9 Valley in Tulare. My grandparents lived there and had a 10 farm. So this is not foreign country to me. 11 Many of you may know that in my recently past 12 life I was Executive Director Los Angeles World Airports, 13 which was the second largest system of airports in the 14 world. And LAX was one of our -- was our flagship 15 airport. 16 And as you can well imagine, airports are very 17 high polluting entities. And we did a lot of work with 18 CARB and I got to know Alan quite well. And so I'm very, 19 very pleased to have had this opportunity to serve on the 20 Air Resources Board. And I look forward to the 21 opportunity of doing the very, very good work that this 22 Board does. 23 CHAIRPERSON LLOYD: Thank you, Lydia. 24 Dr. Ron Loveridge will be arriving a little bit 25 later, so I'll give him the same chance. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 5 1 I realize I'm a little bit in jeopardy today 2 being flanked by two lawyers. So I feel a little bit 3 intimidated here. 4 (Laughter.) 5 CHAIRPERSON LLOYD: So with that I would like to 6 move on to the first agenda item. Agenda item 04-9-1. 7 I'd like to remind anyone in the audience who wishes to 8 testify on the item -- the agenda items today to please 9 sign up with the Clerk of the Board. And if you have 10 written copies of your testimony, to provide 30 copies to 11 the Board Clerk. 12 First agenda item is to consider approval of the 13 San Joaquin Valley 2004 ozone attainment plan as a 14 revision to the California State Implementation Plan. 15 Again, we last visited the district and were 16 hosted by Supervisor Patrick and Dave Crow in June of 2003 17 when the Board approved a new PM10 plan for the San 18 Joaquin Valley. The plan before us today updates the 19 district's strategy for meeting the federal 1-hour ozone 20 standard. 21 They all know that improving air quality in the 22 San Joaquin Valley is a major public health priority for 23 the Board. 24 I'm pleased to see that the ozone plan before us 25 is the first to use the results of the Central California PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 6 1 Ozone Study, setting a new benchmark for the science of 2 air quality modeling. I think to me this is a real 3 landmark meeting that we see the results of this modern 4 program. And I would like to recognize Supervisor Patrick 5 for her continued leadership of the Policy Committee which 6 has guided much of this effort. 7 And I'd also like to acknowledge the tremendous 8 public-private partnership that we've had in going back to 9 Washington seeking funds. I know that Manuel Cunha and 10 others have been instrumental in going back to BACC, going 11 back and getting federal dollars for this outstanding 12 effort. So it gives me great pleasure to see that coming 13 to fruition. 14 I would now like to turn it over to Ms. 15 Witherspoon, who will introduce the item and begin staff 16 presentation. However, before that I did verify that John 17 DaMassa doesn't have laryngitis. So he'll attempt to 18 intercept any questions which are directed to modeling. 19 EXECUTIVE OFFICER WITHERSPOON: I'm forewarned. 20 Good morning, Chairman Lloyd and members of the 21 Board. 22 The 2004 San Joaquin Valley Ozone Plan 23 accomplishes three objectives: 24 First, it updates the Valley's ozone attainment 25 strategy to reflect the most current scientific PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 7 1 information. 2 Second, it adds new emission reduction measures 3 to the existing ozone plan. These measures strengthen the 4 Valley's overall commitment to clean air and are a down 5 payment on the comprehensive strategies that will be 6 needed to achieve more stringent ozone standards in the 7 future. In 2007 the Valley needs to do another ozone plan 8 for the federal 8-hour ozone standard. 9 Third, the plan satisfies federal requirements by 10 meeting U.S. EPA's November 15 deadline for submittal of a 11 revised plan and the obligation to demonstrate attainment 12 for the federal 1-hour ozone standard by 2010. 13 ARB's emission control measures are vital to the 14 plan, providing over 60 percent of the total emission 15 reductions. 16 Mr. Ravi Ramalingam will make the staff 17 presentation. 18 (Thereupon an overhead presentation was 19 Presented as follows.) 20 AIR POLLUTION SPECIALIST RAMALINGAM: Thank you, 21 Ms. Witherspoon. 22 Good morning, Chairman Lloyd and members of the 23 Board. 24 Good morning also to members of the San Joaquin 25 Valley Air Pollution Control District Board who are here PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 8 1 today. 2 --o0o-- 3 AIR POLLUTION SPECIALIST RAMALINGAM: The San 4 Joaquin Valley Unified Air Pollution Control District's 5 Governing Board adopted its extreme ozone attainment 6 demonstration plan on October 8th to satisfy both federal 7 and State ozone planning requirements. 8 The elements that address the federal air quality 9 standard complies with the State Implementation Plan, or 10 SIP, that is the focus of our report and your actions 11 today. 12 The 2004 Valley ozone SIP shows how the region 13 will meet the federal 1-hour ozone standard by 2010. The 14 SIP builds on controls already adopted by this Board, the 15 District and U.S. EPA. It also includes commitments to 16 develop new rules that will provide the additional 17 emission reductions needed to meet the federal 1-hour 18 standard. 19 We are proposing that you adopt this San Joaquin 20 Valley 2004 ozone SIP and direct staff to submit it to the 21 U.S. Environmental Protection Agency for approval. 22 --o0o-- 23 AIR POLLUTION SPECIALIST RAMALINGAM: The Valley 24 developed this plan for the 1-hour standard. U.S. EPA 25 intends to revoke this standard and replace it with a more PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 9 1 health protected federal 8-hour standard next year. 2 The San Joaquin Valley has an outstanding 3 planning obligation for the 1-hour ozone standard. In its 4 regulation governing the transition to the new standard, 5 U.S. EPA provided a choice of planning approaches to 6 fulfill the outstanding planning obligation. The Valley 7 District chose the option to submit a plan and control 8 strategy that demonstrates attainment for the one-our 9 standard by 2010. This decision benefits public health 10 because it requires new emission reduction strategies over 11 the next several years. The measures in this plan will 12 aid in meeting the upcoming 8-hour ozone and fine 13 particulate standards as well. 14 --o0o-- 15 AIR POLLUTION SPECIALIST RAMALINGAM: In my 16 presentation today I'll review the air quality challenge 17 facing the San Joaquin Valley. I'll present the Valley's 18 ozone levels and discuss the sources of ozone-forming 19 emissions. I'll describe the planning process and plan 20 requirements. Finally, I'll summarize ARB staff's review 21 of the 2004 ozone SIP and our recommendation for your 22 action. 23 --o0o-- 24 AIR POLLUTION SPECIALIST RAMALINGAM: Now, let me 25 describe the nature of the challenge facing the Valley. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 10 1 The Valley currently violates all state and 2 federal ozone and particulate matter standards by 3 significant margins. This means that Valley residents 4 breathe unhealthy air throughout the year: High ozone in 5 summer and high particulate matter, or PM, in the fall and 6 winter. 7 The plan before you focuses on attaining the 8 federal 1-hour ozone standard. Over the next few years 9 our emphasis will turn to the federal 8-hour ozone 10 standard and the fine particulate, or PM2.5, standards 11 with new plans due in 2007 and 2008. 12 --o0o-- 13 AIR POLLUTION SPECIALIST RAMALINGAM: ARB's 14 children health study links the onset of asthma to high 15 ozone levels. In the study, sports active children who 16 play three or more sports and live in high ozone areas 17 were three times as likely to develop asthma as kids 18 living in areas with cleaner air. 19 Ozone causes chest pain, coughing, shortness of 20 breath, and threat irritation. More important, when 21 people breath ozone year in and year out it causes 22 long-term lung damage. Studies show that high ozone 23 triggers asthma attacks. It also weakens the ability of 24 the body to fight respiratory infections. 25 --o0o-- PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 11 1 AIR POLLUTION SPECIALIST RAMALINGAM: The San 2 Joaquin Valley features prime conditions for ozone 3 formation. There are three major reasons: 4 Emissions. The Valley has significant emissions 5 of the volatile organic compounds, or VOCs, and oxides of 6 nitrogen, or NOx, that would be apt to form ozone. 7 Topography. Mountains surround the rally on 8 three sides, with little place for polluted air to exit. 9 And meteorology. The summers are sunny and hot, 10 little wind. This sets up strong inversions in the Valley 11 in the air that trap pollution on the Valley floor between 12 the mountains. 13 Put all these together and you have the recipe 14 for many days of unhealthy air. 15 When weather conditions are not stagnant, winds 16 can transport both emissions and ozone from the Bay Area 17 into the Valley and Valley pollution eastward into the 18 Sierras. 19 --o0o-- 20 AIR POLLUTION SPECIALIST RAMALINGAM: A bit of 21 background on air quality standards may be useful. Both 22 U.S. EPA and ARB have adopted ambient air quality 23 standards to protect public health. Compliance is 24 measured region by region, with outdoor pollution 25 monitored in communities. U.S. EPA and ARB designate PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 12 1 areas that violate the standard as nonattainment and 2 require additional actions to meet the standard. 3 The standards are set based on the health effects 4 of air pollution. The economic cost of meeting the 5 standards is not considered in the standard-setting 6 process, but is considered in the development of emission 7 controls. 8 The federal 1-hour ozone standard we're 9 discussing today is a maximum concentration of 0.12 parts 10 per million or 120 parts per billion. 11 --o0o-- 12 AIR POLLUTION SPECIALIST RAMALINGAM: This slide 13 shows the continuum of air quality standards, which will 14 require progressively more emission reductions to attain 15 as you go up the list. The Valley's immediate challenge 16 is to reach the federal 1-hour ozone standard, first 17 milestone, then to meet the more protected standards. 18 We are concerned about the health impacts from 19 exposure to both high level ozone over a single hour and 20 sustained lower levels over the course of a day. U.S. EPA 21 has set federal ozone standards for one hour and eight 22 hour periods. ARB established California's own 1-hour 23 ozone standards. Staff from ARB and the Office of 24 Environmental Health Hazard Assessment are developing a 25 recommendation for the California 8-hour ozone standard PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 13 1 for your consideration next year. 2 I'll focus on the federal 1-hour standard for the 3 remainder of this presentation. 4 --o0o-- 5 AIR POLLUTION SPECIALIST RAMALINGAM: So what is 6 the Valley's ozone air quality? 7 --o0o-- 8 AIR POLLUTION SPECIALIST RAMALINGAM: The Valley 9 is recording fewer days with ozone levels above the 10 federal 1-hour standard. This slide shows the number of 11 days each year that the Valley's exceeded the standard 12 since 1980, from a high of 74 days back in 1988, to a low 13 of 9 days this year. 14 There are two factors at work. Steady emission 15 reductions drive the overall decrease in unhealthy days. 16 Weather accounts for significant variability year to year 17 based on how many hot days there are, just how hot it 18 gets, and whether there are strong inversions that trap 19 ozone near the ground. 20 The mild summer in 2004 contributed to the low 21 number of days over the standard, but it's not just the 22 weather. The weather was also mild in the summers of 23 1982, 1983, 1992, and 1997, but the number of exceedance 24 days was great in those years. 25 The graph shows consistent downward trends in PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 14 1 response to continuing emission reductions, from 43 2 unhealthful days in 1982 down to 9 now. 3 This graph shows the highest of peak 1-hour zone 4 levels measured anywhere in the Valley each year. You can 5 see a slight decline in these peak levels since 1980. In 6 recent years peak levels have hovered at about 160 parts 7 per billion. 8 Although the peak ozone levels have been 9 resistant to change, other air quality indicators show 10 more progress, again, using the federal 1-hour standard as 11 the benchmark. The number of days over the standard is 12 dropping for nearly all sites in the Valley, and air 13 quality modeling shows that the geographic extent to the 14 problem is shrinking, such that fewer communities are 15 exposed to the high levels. 16 Valley air quality is improving in response to 17 emission controls. But there is really a long way to go 18 to ensure healthful air everyday. 19 --o0o-- 20 AIR POLLUTION SPECIALIST RAMALINGAM: In the next 21 several slides I'll describe the magnitude and sources of 22 the Valley's ozone-forming emissions and how they are 23 changing over time. We'll start with this snapshot of 24 current emissions which highlight which agencies are 25 responsible for reducing those emissions. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 15 1 --o0o-- 2 AIR POLLUTION SPECIALIST RAMALINGAM: Manmade 3 sources emit about 400 tons of volatile organic compounds 4 of VOCs on a typical summer day in the Valley. 5 Natural or biogenic VOC emissions from plants 6 contribute to ozone formation in the Valley, while some 7 plants can also absorb pollution. Both of these phenomena 8 are taken into account in the analysis. 9 ARB has estimated the biogenic emissions by 10 vegetation type throughout the Valley. Because these 11 emissions are not subject to control, we include them in 12 the air quality modeling as a constant. But they aren't 13 reflected in the planning inventories used to set or meet 14 targets to reduce and control emissions. 15 We'll focus now on the 400 tons per day of 16 manmade emissions. 17 --o0o-- 18 AIR POLLUTION SPECIALIST RAMALINGAM: 19 The combination of sources of the district 20 jurisdiction accounted for half of the VOC emissions by 21 today, shown here as "other district sources," in red, at 22 36 percent, and "livestock waste," in pale blue, at 15 23 percent. The other stationary and area-wide sources under 24 the district's regulatory authority include activities 25 like oil and gas production and industrial solid refuse. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 16 1 The bulk of the livestock waste emissions are 2 from the large concentrated feeding operations at dairies 3 and feedlots. 4 The plan includes current emission estimates. 5 Extensive research is under way to better understand both 6 the quantity of waste associated with an animal and the 7 rate of emissions from that waste. 8 The next big piece of the pie, in magenta, at 27 9 percent, is emissions from gas vehicles like cars, 10 pickups, and sport utility vehicles as well as off-road 11 gas and propane equipment like lawnmowers forklifts and 12 recreational boats. ARB regulates these sources and their 13 fuels. 14 The Board also controls emissions from consumer 15 products like hair spray and home cleaners, in pink, at 6 16 percent. 17 The State Department of Pesticide regulation is 18 responsible for pesticide emissions, in yellow, at 6 19 percent. 20 ARB and U.S. EPA share authority controlling 21 diesel engines and fuels used in trucks and off-road 22 diesel equipment, in green, at 7 percent. 23 U.S. EPA has the exclusive authority to set 24 emission standards for new engines used in trucks 25 registered outside California and in most farm and PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 17 1 construction equipment. 2 Planes, trains and ships, in orange, at 2 3 percent, are under the legal or practical control of U.S. 4 EPA and international authorities. 5 For NOx the picture changes. 6 --o0o-- 7 AIR POLLUTION SPECIALIST RAMALINGAM: NOx 8 emissions are primarily a product of fuel combustion. 9 Diesel engines under federal an State control contribute 10 about half of all NOx emissions in the Valley, with 11 on-road vehicles producing 22 percent and off-road 12 equipment account for 23 percent. 13 Diesel trains generate nearly 6 percent of the 14 total NOx. Gas vehicles and off-road gas equipment 15 contribute 18 percent. District NOx sources, at a 16 combined 31 percent, include powerplants, manufacturing, 17 oil and gas production activities and agricultural 18 irrigation pumps. 19 Considering both VOC and NOx, the state, the 20 district, and the federal government each have 21 responsibility for reducing significant portions of the 22 emissions pie in the San Joaquin Valley. 23 --o0o-- 24 AIR POLLUTION SPECIALIST RAMALINGAM: This graph 25 shows how VOC and NOx emissions from all sources in the PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 18 1 Valley are changing between 1990 and 2010 with regulations 2 already in place. Existing state, local and federal 3 control programs will cut emissions by over 40 percent, 4 while the Valley population grows more than 50 percent in 5 the same timeframe. The control strategy in this plan 6 will drive emissions down further. 7 --o0o-- 8 AIR POLLUTION SPECIALIST RAMALINGAM: Now I'll 9 describe generally what goes into a SIP and what past 10 plans are applicable to the Valley. 11 --o0o-- 12 AIR POLLUTION SPECIALIST RAMALINGAM: 13 California's State Implementation Plan is the 14 comprehensive blueprint of how each nonattainment area 15 will meet the federal air quality standards by the 16 applicable deadline. The SIP includes the technical 17 foundation air quality monitoring that defines the scope 18 of the pollution problem, extensive data, cataloguing the 19 sources, and the mild contributing emissions and air 20 quality modeling to define the relationship between 21 monitored air quality and emission levels. The heart of 22 the SIP is a control strategy to reduce emissions to meet 23 the attainment targets for each pollutant. 24 Emissions from the transportation sector play a 25 critical role in every region's air quality strategy. To PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 19 1 ensure that transportation infrastructure investments do 2 not hinder attainment, federal law requires that SIPs 3 identify the maximum amount of emissions from 4 transportation sources that still allow the region to 5 demonstrate attainment and interim programs. 6 This is the transportation emissions plan. The 7 timeframe for a SIP is set by the Federal Clean Air Act, 8 which establishes a legal mandate to attain the standard 9 by a specified deadline. 10 --o0o-- 11 AIR POLLUTION SPECIALIST RAMALINGAM: In a 12 nutshell, an attainment demonstration is the analytical 13 proof that the control strategies in the plan will reduce 14 emissions to a level that photochemical modeling predicts 15 will lead to attainment standards. 16 The attainment demonstration starts with a 17 multi-day episode where the high ozone levels are 18 monitored and intensive weather measurements are 19 collected. We develop an emission inventory specific to 20 that episode, including the sources and their locations. 21 We run complex computer models that simulate the chemical 22 and physical ozone formation processes to correlate the 23 emissions, weather and air quality data. 24 Once the model can replicate the measured ozone 25 level, it's ready to be applied to the future. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 20 1 --o0o-- 2 AIR POLLUTION SPECIALIST RAMALINGAM: Under the 3 same weather conditions we look at how incremental 4 reductions in VOC and/or NOx would change future ozone 5 levels. 6 --o0o-- 7 AIR POLLUTION SPECIALIST RAMALINGAM: Next the 8 district and ARB identify the combination of VOC and NOx 9 attainment emission targets for a specific plan. 10 Finally, district and ARB staff design control 11 strategies for all categories of sources to bring 12 attainment to your emissions down to the target levels. 13 Let's look at an example. 14 --o0o-- 15 AIR POLLUTION SPECIALIST RAMALINGAM: The column 16 on the left shows the region's hypothetical emissions in 17 the attainment year with controls already in place. This 18 is a baseline inventory. The red horizontal line is the 19 attainment emission target projected by the air quality 20 modeling. 21 The right-hand column shows projected emissions 22 with the benefits of new measures in the plan that produce 23 the combined emissions from stationary, area-wide and 24 on-road mobile and off-road mobile sources to the target 25 level. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 21 1 I mention earlier that SIP would set 2 transportation emission budgets. The right-hand column 3 shows smaller on-road vehicle emissions because of new 4 controls in the plan. This is the motor vehicle emission 5 budget used for transportation conformity. I'll describe 6 transportation conformity a bit more. 7 --o0o-- 8 AIR POLLUTION SPECIALIST RAMALINGAM: The Clean 9 Air Act sets out special requirements to ensure that air 10 quality and transportation planning work together. 11 Specifically transportation planning agencies must 12 periodically show that the total emissions resulting from 13 build out of said transportation programs and projects 14 would fit within the motor vehicle emission budgets in the 15 SIP. The law requires an affirmative conformity finding 16 before federal agencies can provide transportation funding 17 or even approve projects funded solely by state or local 18 dollars. 19 Over $2.5 billion a year of federal 20 transportation funding in California depends on the 21 ability to make conformance findings in each nonattainment 22 area. Failure to conform can result in funding delays or 23 even loss of funding. 24 --o0o-- 25 AIR POLLUTION SPECIALIST RAMALINGAM: Local air PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 22 1 districts, ARB and U.S. EPA are all involved in SIP 2 development. ARB plays a dual role as partner and 3 oversight agency. We partner with air districts to 4 develop the technical elements and control strategies in 5 the plan. The Board is also the lead agency under state 6 law responsible for ensuring SIPs comply with federal law. 7 District and ARB work jointly to develop the 8 emissions inventory and to do the necessary air quality 9 modeling. ARB adopts the commitments with new statewide 10 emission reduction strategies, while each district adopts 11 its local control strategy. The district board holds a 12 public hearing and adopts the plan, then forwards it to 13 ARB for action. 14 All SIP revisions must come through ARB for 15 adoption before they can be submitted to U.S. EPA. We 16 bring plans that are significant or controversial to the 17 Board for your consideration. Routine submittals are 18 approved by the Executive Officer. 19 If you adopt this plan today, staff will forward 20 it to U.S. EPA for federal approval. Once U.S. EPA 21 approves the plan, the control measures and commitments to 22 develop measures contained in the plan, they become 23 federally enforceable. 24 --o0o-- 25 AIR POLLUTION SPECIALIST RAMALINGAM: It is PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 23 1 useful to briefly review the recent history of Valley 2 SIPs. Following the 1990 amendments to the Clean Air Act 3 U.S. EPA classified the Valley as a serious nonattainment 4 area for the 1-hour ozone standards and attainment 5 deadline of 1999. In 1994 the district adopted and ARB 6 submitted to U.S. EPA for its ultimate approval a 1-hour 7 ozone SIP demonstrating attainment in 1999. 8 That plan was based on our best understanding of 9 the Valley emissions and ozone chemistry at the time. 10 Hindsight tells us that the emission inventory was 11 underestimated. Ultimately the control measures in the 12 1994 plan were not sufficient for the region to attain by 13 the deadline. 14 When a region fails to meet its attainment 15 deadline federal law directs U.S. EPA to reclassify the 16 area to the next higher level, starting a new round of 17 planning and control measure Implementation with more time 18 to attain. The Valley was bumped up to a severe 19 classification with a new deadline of 2005. 20 In 2002 the district adopted a plan with new 21 measures to show continued progress in reducing emissions 22 through 2005. However, the Valley was not able to 23 identify control measures that would provide reductions 24 sufficient to attain by 2005. Consequently the district 25 requested a voluntary reclassification to extreme with a PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 24 1 2010 deadline, which brings us to this plan. 2 Last year the district and ARB adopted a plan to 3 attain the federal particulate matter, or PM10, standards 4 in the Valley by 2010. U.S. EPA has approved the 5 particulate plan, making the commitments for new measures 6 already federally enforceable. Many of the PM10 plan 7 measures will also reduce ozone-forming emissions. 8 --o0o-- 9 AIR POLLUTION SPECIALIST RAMALINGAM: ARB also 10 adopts a plan that describes the state's emission 11 reduction measures to support attainments of the air 12 quality standards across California. These measures cover 13 the emission sources under state control, including 14 vehicles, equipment, fuels and consumer products. 15 Regional SIPs take credit for the expected reductions from 16 these new measures. 17 In October 2003 the Board held a public hearing 18 and updated its comprehensive statewide strategy for ozone 19 and particulate matter concurrent with approval of the 20 South Coast SIP. 21 The 2003 statewide strategy described the 22 significant progress that ARB, other state agencies, and 23 the U.S. EPA have made in implementing the measures in the 24 1994 SIP. The new strategy updates the state's SIP 25 commitments and defines ARB's rule-making calendar over PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 25 1 the next few years, calling for development of 20 new 2 statewide measures. We also develop a longer-term process 3 to identify additional strategies. 4 When approving the 2003 statewide strategy the 5 Board directed the Executive Officer to calculate the 6 appropriate emission reductions for the new state measures 7 for other regions to credit towards the payment in their 8 SIPs. ARB staff calculated those numbers, and the 2004 9 San Joaquin Valley ozone SIP reflects the appropriate 10 benefits. 11 The Board does not need to take any further 12 action on the statewide strategy today. 13 --o0o-- 14 AIR POLLUTION SPECIALIST RAMALINGAM: The Board 15 has already adopted several measures in the 2003 statewide 16 strategy, including regulations for lawn and garden 17 equipment, truck idling, diesel controls, and the 18 near-term consumer products standards. 19 Other SIP measures are in development. They 20 include: The next rules to clean up the fleet diesel 21 engines used in trucks, off-road equipment and harbor 22 craft; programs to evaluate the feasibility of replacing 23 emission control components on passenger vehicles and to 24 approve smog check; standards for lower emission 25 industrial equipment like forklifts, pumps and PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 26 1 compressors; further controls on gasoline vapors from 2 storage and refueling; hydro-emission limits on consumer 3 products; and expanded funding for the successful Carl 4 Moyer program and other incentives for cleaner engines. 5 The Legislative Office will describe the new 6 incentive funding authorized this year as part of its 7 report to you this afternoon. 8 The commitment to the 2003 statewide strategy 9 recognizes that the Board may adopt the 20 specific 10 measures described in the plan or alternative approaches 11 that provide equivalent emission reductions to meet the 12 state's overall targets. 13 Next I'll summarize ARB staff's review of the 14 2004 San Joaquin Valley ozone SIP. 15 --o0o-- 16 AIR POLLUTION SPECIALIST RAMALINGAM: The legal 17 requirements for this plan include: Updated technical 18 information, including air quality data and complete 19 emission inventories; emission reduction strategies, 20 including adopted measures and enforceable commitments for 21 future measures; interim emission reduction milestones to 22 ensure steady progress; an attainment demonstration based 23 on photochemical modeling and transportation conformity 24 budgets. 25 --o0o-- PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 27 1 AIR POLLUTION SPECIALIST RAMALINGAM: The 2004 2 ozone SIP benefits from the extensive data and tools 3 developed as part of the ongoing central California ozone 4 study for C-Coast. C-Coast is a public-private $18 5 million multi-year program of meteorological and air 6 quality monitoring, emission inventory development, data 7 analysis, and air quality modeling. 8 C-Coast was designed to advance the science and 9 provide modeling capability for all of California north of 10 the Tehachapi Mountains. Data collected in C-Coast, 11 especially for the July-August 2000 intensive ozone 12 episode, provides the basis for the air quality modeling 13 and attainment demonstration in the Valley's 2004 ozone 14 SIP. 15 The Ozone SIP uses updated emission as estimates 16 for stationary, area-wide, and on- and off-road mobile 17 sources. This inventory reflects improved methodologies 18 for estimating emissions, recently adopted controls, 19 current growth projections, previously uninventoried 20 sources, and other upgrades. 21 The plan's on-road mobile source emissions were 22 estimated using California's current motor vehicle 23 emission factor model, called EMPACT 2002 and recent data 24 activity provided by the Valley's transportation planning 25 agencies. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 28 1 The tools and data used in the modeling analysis 2 for the 2004 ozone SIP represent the state of the science 3 and a significant step forward since 1994 in our 4 collective ability to understand the level of emission 5 controls needed to meet the ozone standard in the Valley. 6 The modeling results meet the performance criteria 7 established by both U.S. EPA and ARB. 8 --o0o-- 9 AIR POLLUTION SPECIALIST RAMALINGAM: What does 10 this plan accomplish? It demonstrates that measures 11 already adopted will cut VOC and NOx emissions by 24 12 percent between the 2000 starting point of the plan and 13 the 2010 attainment date. It includes new state and local 14 measures that will reduce emissions another 10 percent to 15 reach the attainment targets. 16 The combined 34 percent emission reduction 17 corresponds with 342 tons per day of VOC and NOx emissions 18 that will be eliminated under the plan. The plan also 19 shows that emission reductions will be steadily reduced to 20 show interim progress prior to the 2010 attainment date. 21 --o0o-- 22 AIR POLLUTION SPECIALIST RAMALINGAM: This table 23 summarizes the emission reduction accounting for the plan, 24 including the breakdown by jurisdiction. These numbers 25 all indicate the net change in emissions between 2000 and PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 29 1 2010 after accounting for growth. 2 Looking across the bottom row, you can see that 3 of the total 342 tons per day of reductions needed, 238 4 come from already adopted measures, 46 tons come from 5 measures included in the PM10 plan last year, and 58 tons 6 come from new measures included in the ozone plan. 7 Looking down the far right column, you can see 8 that the state is providing reductions of 211 tons per 9 day, with most of those coming from the ARB's regulations 10 for cleaner engines and fuels. For the district most of 11 the reductions are coming from new measures, either in the 12 PM10 plan or being added in this new ozone plan. 13 This reflects the district's rule-making 14 commitments, which will achieve feasible and 15 cost-effective reductions for sources under district 16 jurisdiction. Existing federal regulations contribute 52 17 tons per day of reductions with no new federal actions 18 assumed in the plan. 19 --o0o-- 20 AIR POLLUTION SPECIALIST RAMALINGAM: The local 21 control strategy builds on the district's prior 22 commitments in the PM10 plan to adopt new measures that 23 will reduce emissions by 36 tons per day. 24 The table on the last slide showed 33 tons per 25 day of reductions from new district ozone SIP strategies. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 30 1 There are two types of district measures to reach this 2 total. First, the district is committed to develop and 3 adopt 12 new measures to reduce emissions by another 23 4 tons per day. If the district board later finds that the 5 measure is infeasible based on additional information, it 6 will adopt the alternative to achieve equivalent 7 reductions in the same timeframe. And, second, the 8 district commits to identify longer-term measures by 2007 9 that rely on advanced technology to achieve the remaining 10 10 tons per day reductions. 11 Like the South Coast, the Valley can rely on this 12 provision of the Clean Air Act for extreme ozone 13 nonattainment areas. 14 Let's take a close look at the 12 specific new 15 measures that the district has committed to develop as 16 part of this ozone SIP. 17 --o0o-- 18 AIR POLLUTION SPECIALIST RAMALINGAM: The 19 greatest reductions, over 15 tons per day, are expected to 20 come from new techniques and technology to cut VOC 21 emissions from animal waste, concentrated animal feeding 22 operations. This measure is part of the district's 23 compliance with Senate Bill 700 by Senator Florez that was 24 enacted in 2003. The statute requires the Air Resources 25 Board to define a large confined animal facility by PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 31 1 mid-2005 and local air districts in federal nonattained to 2 areas to adopt rules by mid-2006 controlling large 3 facility emissions to the extent feasible. 4 And the second significant category is open 5 burning. Senate Bill 705 requires the phaseout of 6 agricultural burning in the Valley. The statute provides 7 an exception to allow burning only for disease control, 8 not for day-to-day agricultural waste disposal. The 9 district estimates have combined 4 tons of VOC plus NOx 10 reductions from its measures to implement this provision. 11 Another new measure will reduce emissions from 12 large gasoline storage tanks at terminals and bulk plants. 13 The district included a single omnibus SIP 14 measure to tighten ten existing rules for industrial 15 coatings and solvents. Since these rules were last 16 amended other districts have started requiring lower VOC 17 solvents. But this measure upgrades the district's rules 18 to these new standards. 19 Other district measures would lower emissions 20 from solid fuel boilers, stationary turbines, school bus 21 fleets, automobile coatings, soil decontamination, 22 composting, and aviation refueling operations. This last 23 measure calls for vapor recovery while the bulk storage 24 tanks are being filled and during fuel transfer from these 25 tanks into delivery trucks. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 32 1 --o0o-- 2 AIR POLLUTION SPECIALIST RAMALINGAM: I've 3 covered the new measures that ARB is developing as part of 4 the 2003 statewide strategy. This ozone plan takes full 5 credit for the emission reductions expected from the 20 6 measures in the 2003 statewide strategy, building on the 7 Board's prior commitment in the Valley's PM10 plan. 8 Looking at the total line across the bottom, ARB 9 will need to adopt measures that provide 15 tons per day 10 of VOC and 20 tons per day of NOx reductions in the San 11 Joaquin Valley in 2010. 12 --o0o-- 13 AIR POLLUTION SPECIALIST RAMALINGAM: We conclude 14 that the Valley's plan is technically sound and meets 15 applicable requirements. It includes substantive new 16 commitments to reduce emissions and will provide public 17 health benefits for the residents of the San Joaquin 18 Valley. 19 Staff recommends that the Board adopt the 2004 20 State Implementation Plan for ozone in the San Joaquin 21 Valley and direct the Executive Officer to submit the plan 22 to U.S. EPA for approval. 23 This concludes my presentation. Thank you. 24 CHAIRPERSON LLOYD: Thank you very much. Clear 25 presentation. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 33 1 You'd mentioned earlier that in 1994 you 2 predicted attainment by 1999, by five years. You gave 3 some reasons why you didn't get attainment. 4 What comfort do we have that now looking again 5 five years down the line that we're going to be more 6 successful? 7 EXECUTIVE OFFICER WITHERSPOON: Are you directing 8 that to the modeling staff or the -- 9 (Laughter.) 10 CHAIRPERSON LLOYD: Whoever best can answer it. 11 EXECUTIVE OFFICER WITHERSPOON: Well, why don't 12 we start with the technical staff both on the inventory 13 updates that were made and the modeling assessment that 14 was done. 15 CHAIRPERSON LLOYD: You can see what I'm trying 16 to get at. I heard some reasons there. Obviously we get 17 a better model. But on the other hand I was a bit 18 surprised that we're saying -- we're assuming that the -- 19 we're not assuming that the Feds are going to do 20 anything -- not assuming to this plan, which is good in 21 one way. On the other hand it's bad. Why shouldn't they 22 be doing something? 23 And the other part of it is what margin of safety 24 do we have in the modeling that typically we tend to 25 overestimate our ability to show attainment? So what we PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 34 1 model at this time, how much margin of safety do we have 2 in the model? What's the difference between predicted and 3 we measure. 4 And then since John is here, when you've got -- 5 how many monitors are there in the whole region? And how 6 do we know that the monitors are of areas of peak ozone? 7 I know there's a bunch of stuff there. 8 MODELING AND METEOROLOGY BRANCH CHIEF DaMASSA: 9 Sure. I'll do my best to answer those. 10 When we ran the 1994 SIP model, as Ravi had 11 indicated, the emission inventory at that time was 12 appreciably underestimated. 13 CHAIRPERSON LLOYD: But that's nothing new. We 14 hear that every time. 15 MODELING AND METEOROLOGY BRANCH CHIEF DaMASSA: 16 As a modeler, that's ingrained in us. 17 (Laughter.) 18 MODELING AND METEOROLOGY BRANCH CHIEF DaMASSA: 19 But we went back a couple years ago and revisited 20 the 1994 SIP model and then revised estimate using updated 21 emissions. And the result that we came up from that 22 exercise are very consistent with the modeling that was 23 done for the current plan. In other words the attainment 24 target is very nearly the same from what we did for the 25 1994 updated modeling and the current modeling. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 35 1 You posed another question about the locations of 2 the model peaks versus monitors for the current round of 3 modeling. The model predicts peak locations in the 4 southern part of the San Joaquin Valley, which are not at 5 monitors. And that's a typical case. When we do our 6 carrying capacity diagrams from which we derive the 7 attainment targets, we take into consideration the 8 location of the peak model concentrations rather than only 9 at the monitors. So that is factored in. 10 Another thing that you had raised was the model's 11 ability to replicate the monitored value. 12 For the current round of modeling, we do tend to 13 underestimate the observed concentrations by on the order 14 of 2 to 10 percent. Most of the values are within a 2 to 15 5 percent range. This level of modeling is much better 16 than we have seen in previous SIPs in San Joaquin Valley 17 specifically and probably even in some of the SIPs that 18 we've done in southern California. So we believe it's the 19 best that we can attain at this point in time. And we are 20 continuing to update the modeling, the modeling tools. We 21 mentioned inventories, how we estimate things like 22 wildfire emissions and natural emissions. So we are 23 continuing to improve the modeling. But for the current 24 SIP modeling, we believe that it's very good. It 25 significantly exceeds both EPA and ARB for modeling PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 36 1 performance criteria. So we're very comfortable with it. 2 CHAIRPERSON LLOYD: When you show attainment, 3 you're shooting up a .12. 4 MODELING AND METEOROLOGY BRANCH CHIEF DaMASSA: 5 We actually shoot a .124. 6 CHAIRPERSON LLOYD: Okay. So given this level of 7 emission reductions, what is your maximum predicted 8 ambient air quality for ozone? 9 MODELING AND METEOROLOGY BRANCH CHIEF DaMASSA: 10 In the future year? 11 CHAIRPERSON LLOYD: Yes. 12 MODELING AND METEOROLOGY BRANCH CHIEF DaMASSA: 13 For the baseline for 2010 -- is that what you're 14 asking? 15 CHAIRPERSON LLOYD: Well, what I'm saying is that 16 given the emissions reductions, what are you projecting 17 will be -- you're projecting attainment. But is there any 18 margin of safety or do you say it's .124 and that's -- 19 MODELING AND METEOROLOGY BRANCH CHIEF DaMASSA: 20 There's very little margin of safety. You're 21 basically right at the .124 level. 22 CHAIRPERSON LLOYD: So if we pushed the Feds to 23 do a little bit more, that would be in the right 24 direction? 25 MODELING AND METEOROLOGY BRANCH CHIEF DaMASSA: PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 37 1 It would be, unless the inventory estimates 2 change significantly between now -- 3 CHAIRPERSON LLOYD: But you said you would have 4 much better inventory. So that's not likely to change. 5 MODELING AND METEOROLOGY BRANCH CHIEF DaMASSA: 6 The inventory's certainly much better. The 7 inventory has the ability to change over time. But based 8 on what we know right now, we believe that attainment is 9 achievable by 2010. 10 CHAIRPERSON LLOYD: Well, I think I was going to 11 ask maybe Catherine, because I know that you've been 12 working with the railroads to see if we can get cleaner 13 burning in the air. Is that factored into this or would 14 that help us get a greater margin of safety? 15 EXECUTIVE OFFICER WITHERSPOON: It's not factored 16 into this except that the district has 10 tons that are 17 unidentified at the current time, which they're taking 18 responsibility for. But in the event that federal 19 controls occurred between now and 2010, that might provide 20 some of the ten missing or provide an additional cushion 21 of safety. 22 And I would also point out that because we have 23 to come back with an 8-hour ozone plan in 2007, there is a 24 mid-course review of where we are for the one hour as 25 we're doing the eight hour. And there's also the question PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 38 1 of revocation of the one-hour standard, which EPA has 2 already proposed, has been sued over. And so this was a 3 very responsible step that the district took, putting 4 together a one-hour plan in the face of a standard that 5 might disappear. But all those things converge I think in 6 2007, and we'll know exactly where we are in terms of 7 federal steps forward and what we've negotiated with 8 railroad and the Port of Stockton in effect here too, 9 what's going on in the Bay Area and their plans coming up 10 in the spring, any other kinds of contributions to the 11 Valley's attainment strategy. 12 CHAIRPERSON LLOYD: I have a couple of questions 13 on that. One in terms of the transport which is -- is 14 factored into that transport from the Bay Area. And then 15 what percentage of -- is there any contribution for 16 biogenic hydrocarbons to the VOC emissions? 17 MODELING AND METEOROLOGY BRANCH CHIEF DaMASSA: 18 Was your first point a question or a statement? 19 CHAIRPERSON LLOYD: The amount of transport from 20 the Bay Area on the particular modeling days that you 21 chose. 22 MODELING AND METEOROLOGY BRANCH CHIEF DaMASSA: 23 We haven't actually quantified the amount of 24 transport from the Bay Area. The meteorology or the 25 weather event that we're simulating does include air flow PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 39 1 from the Bay Area into the San Joaquin. And the model 2 does account for that. We have not specifically 3 quantified that. It's not a straightforward issue. We 4 are working very closely with technical staff in the Bay 5 Area, Sacramento, San Joaquin -- 6 CHAIRPERSON LLOYD: That's Bay Area -- 7 BOARD MEMBER DeSAULNIER: I'm not doing it. 8 MODELING AND METEOROLOGY BRANCH CHIEF DaMASSA: 9 We are working very closely with technical staffs 10 from the districts to come up with consensus methodology 11 for how to quantify transport and characterize its 12 frequency of occurrence. That's something that we hope to 13 have available for in the 8-hour ozone plan modeling 14 timeframe. 15 I'm sorry. Your second question was -- 16 CHAIRPERSON LLOYD: Any contribution of biogenic 17 hydrocarbons to VOC emissions inventory? 18 MODELING AND METEOROLOGY BRANCH CHIEF DaMASSA: 19 The biogenics do contribute substantially to the 20 overall VOC inventory in the Valley. Ravi had presented 21 some numbers previously. 22 The biogenic inventory -- VOC inventory depends 23 greatly on temperature and on solar radiation. On very 24 hot days it can be very significant. However, the bulk of 25 the emissions come from species like valley oaks and PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 40 1 species which are above the valley floor. So it's not a 2 one-to-one relationship between biogenic emissions and 3 ozone increases. 4 CHAIRPERSON LLOYD: I just wanted to make sure 5 they're factored. And that's fine. 6 MODELING AND METEOROLOGY BRANCH CHIEF DaMASSA: 7 Yes, they are. 8 CHAIRPERSON LLOYD: All right. Let my colleagues 9 have a chance. 10 DEPUTY EXECUTIVE OFFICER TERRY: Dr. Lloyd, can I 11 could jump in. 12 One thing that John had to say relative to the 13 margin of safety concept; and, that is, he mentioned the 14 fact that this plan is designed around the model peak. 15 And so that is a 136 going down to a 124 standard. The 16 monitored value was only 115. So by choosing to use the 17 model peak value, we get a lot more emission reduction 18 than if we had simply used the lowered monitored value of 19 115. So in our mind that represents a margin of safety. 20 CHAIRPERSON LLOYD: Thanks for that. 21 Ms. D'Adamo. 22 BOARD MEMBER D'ADAMO: I have a couple of 23 questions regarding -- if we could get back to the 24 modeling and the inventory, specifically on growth. I 25 haven't followed this very closely so I may not be correct PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 41 1 on the information that I have. But I understand that -- 2 I think it was the Department of Finance recently revised 3 its growth projections for the state, specifically for the 4 Valley. And that I believe that it was originally 5 overestimated what the growth would be. And I'm just 6 curious what figures you used, the more recent ones or the 7 older data on growth projections? 8 AIR POLLUTION SPECIALIST RAMALINGAM: Thank you. 9 Yes, the Department of Finance recently put out 10 new numbers. And the new numbers are slightly lower than 11 what we used in this SIP, from the period of 2000 to 2010. 12 What numbers we used were 3 percent higher than Finance's 13 new numbers. 14 BOARD MEMBER D'ADAMO: Okay. So perhaps that 15 would give us a little bit of margin of safety. 16 AIR POLLUTION SPECIALIST RAMALINGAM: Margin of 17 safety. 18 BOARD MEMBER D'ADAMO: Right. And now getting 19 back to the transport question. 20 It's my understanding that the emissions 21 inventory only looks at the inventory within the air 22 district, correct? It doesn't include emissions from 23 outside sources such as the Bay Area or the Sacramento 24 region. 25 MODELING AND METEOROLOGY BRANCH CHIEF DaMASSA: PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 42 1 Actually the modeling domain or area that we 2 simulate does include Bay Area. The Sacramento Valley, 3 it's basically from Shasta south to the Tehachapi's. So, 4 yes, it does include emissions for the entire region. 5 CHAIRPERSON LLOYD: One of the advantages of the 6 new model. 7 BOARD MEMBER D'ADAMO: Okay. 8 MODELING AND METEOROLOGY BRANCH CHIEF DaMASSA: 9 Previously though the domain was smaller. But 10 this domain is much larger, to encompass -- to better 11 encompass transport and other issues like that. 12 BOARD MEMBER D'ADAMO: Modeling versus the 13 inventory or the inventory accounted for within the 14 modeling? 15 MODELING AND METEOROLOGY BRANCH CHIEF DaMASSA: 16 Right. 17 BOARD MEMBER D'ADAMO: I'm looking at these pie 18 charts. The slides -- 19 EXECUTIVE OFFICER WITHERSPOON: The pie charts do 20 Valley only. 21 BOARD MEMBER D'ADAMO: Oh, Okay. 22 EXECUTIVE OFFICER WITHERSPOON: But the model and 23 its estimates has the whole domain in it. And so when you 24 presume what's going on in the adjacent air districts and 25 how their emissions are changing, then that's reflected in PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 43 1 the mix in the atmosphere. 2 BOARD MEMBER D'ADAMO: Okay. So let's just take 3 one portion of these pie charts then, planes, trains and 4 ships. Under VOCs you show 2 percent inventory and under 5 NOx, 6 percent. 6 Assuming that somehow miraculously something can 7 be done on the train side of the equation, what sort of 8 impact would that have? If we're looking at these pie 9 charts, just look at the Valley, what sort of an impact 10 would that have on -- I guess it would be the modeling, 11 not the inventory, until something is done? 12 EXECUTIVE OFFICER WITHERSPOON: Next month the 13 Board will be considering a requirement for low sulfur 14 diesel fuel for -- locomotives. And that will give us a 15 modest emission reduction for that portion of rail track 16 that's in the Valley. Unfortunately most of the track 17 that's in the Valley is line haul on it. So you're not 18 going to see an immediate return on a low sulfur diesel 19 fuel except choices that the rail companies might make to 20 purchase more low sulfur fuel than they're required to do 21 under our proposed regulation. 22 We're also talking to them about 23 rail-yard-oriented strategies. But, again, it's not huge 24 rail yard in the Valley proper. They're smaller ones. 25 We're looking at reduced idling, more rapid response to PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 44 1 smoking diesel engines, cleaning them up. 2 And then for the longer term we're working 3 through the pace of locomotive turnover and to what new 4 standards the new engines will be engineered. Is it a 5 matter of bringing the tier 2 faster? Is it rebuilding to 6 an in-betweener emission standards? What degree of 7 penetration of all fuels is possible. What degree of 8 retrofit is possible? And these things are really just 9 beginning in the locomotive sector. 10 So the Valley will gain from them, but I think 11 over a longer term as we look at the 8-hour standard. 12 There will be some very modest decrease in the near term. 13 BOARD MEMBER D'ADAMO: Would anyone have 14 information on the Bay Area for that category, planes, 15 trains and ships? 16 EXECUTIVE OFFICER WITHERSPOON: The Bay Area will 17 have it in their SIP. 18 BOARD MEMBER D'ADAMO: No., does anyone here have 19 that information? Just to get an idea -- I'm trying to -- 20 you're talking about the policy. And I'm trying to get a 21 better sense of, if the policy changes are made, what sort 22 of impact it would be. You're saying over the long haul 23 it would be perhaps a minimal impact. But that's just in 24 terms of our inventory? Or would it account for the 25 transport? PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 45 1 EXECUTIVE OFFICER WITHERSPOON: I was talking 2 controlled strategies for locos and the way they play out 3 in the Valley. And there's not as much locomotive 4 activity in the Bay Area. 5 For ports it's a different situation and what we 6 might be able to achieve for those. They have more 7 facilities. Where marine vessels themselves will be the 8 most stubborn, high resistant to change because of the 9 whole complication of authority, the length of life of 10 those vessels, their ability to fuel up in other nations 11 and those sorts of things. So a lot of the near-term 12 benefits will come from cargo handling. Staff's also 13 working with the cargo handling rule and our diesel 14 clean-up strategies. And those will affect the Port of 15 Stockton, the Port of Oakland and the amount of transport 16 entering the Valley. 17 DEPUTY EXECUTIVE OFFICER TERRY: There's also 18 the -- just for clarification. This modeled inventory 19 includes all of the reductions that will occur in the Bay 20 Area from adopted rules. It does not include a number of 21 proposals that the Bay Area district is working on in 22 developing a current clean air plan which should be 23 completed early next year. 24 And so this plan for the Valley is really a 25 transitional plan in a certain sense because we're already PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 46 1 working on the next SIP for the Valley, which is to meet 2 the 2007 deadline. And in that process we've got a major 3 effort under way to deal with the transport, to 4 incorporate that rule review -- that rule comparison 5 exercise that you all have been involved in between the 6 districts within the broader region. And all of those new 7 measures will be incorporated into the modeling done over 8 the next year or so for the next SIP for the Valley. 9 EXECUTIVE OFFICER WITHERSPOON: Yeah, I do think 10 it's important that the Valley be a stakeholder in what 11 goes on in their imports, because there's about to be a 12 major initiative undertaken through state auspices over 13 CalEPA and the Air Resources Board attempting to figure 14 out what the control strategy, comprehensive strategy is 15 going to be. And the Valley is affected by Board 16 emissions -- 17 BOARD MEMBER D'ADAMO: I agree. I mean I think 18 it's easy -- it's easy to get folks engaged on this NOx 19 issue because -- 20 BOARD MEMBER DeSAULNIER: It's easy for you to 21 say. 22 (Laughter.) 23 BOARD MEMBER D'ADAMO: -- because drivers here 24 are subject to it. But the support issue, that's why I 25 was trying to get a better handling on what the emissions PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 47 1 inventory is in the Bay Area. And my hope is that if 2 policy changes are affected, that it would provide for a 3 significant benefit for the Valley, not knowing that it's 4 hard to get people engaged. 5 Thank you. 6 CHAIRPERSON LLOYD: Questions? 7 What about -- I guess I'll go back to Catherine. 8 Pesticides addressed here? I know we're about to 9 embark on some more characterization of pesticide emission 10 reactivity, et cetera. 11 EXECUTIVE OFFICER WITHERSPOON: Only the existing 12 pesticide measures were accounted for in this plan. The 13 Department of Pesticide Regulation is in the middle of a 14 process to develop new targets and strategies for the next 15 round. 16 CHAIRPERSON LLOYD: Okay. And one -- maybe a 17 question of Barbara. When this plan appeared before 18 you -- maybe Dave can comment some more -- did you have 19 any opposition to it then? 20 BOARD MEMBER PATRICK: No, no, absolutely. It 21 was unanimously supported by stakeholders and by the 22 governing board. 23 CHAIRPERSON LLOYD: Thank you very much. 24 With that I'd like to call the first witness. 25 And we remind the witnesses, if they have any written PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 48 1 comments, please provide those to the Board. 2 So we have Dave Crow, David Mager and Manual 3 Cunha. 4 MR. CROW: Good morning, Dr. Lloyd, members of 5 the CARB Board, staff. We're grateful for you attending 6 the meeting today here in Fresno. We think it's an 7 important opportunity to become more familiar with the 8 Valley issues and take an action today on a very important 9 plan. 10 On behalf of our governing board several members 11 are in the audience today: Supervisor Mike Nelson from 12 Merced, Dan Prince from the City of Ripon. And other 13 board members intend to be here through the course of your 14 meeting today. 15 We'd like to encourage the California Air 16 Resources Board to adopt this implementation plan. I have 17 to say that this plan has involved a great deal of 18 analytical work and a tremendous amount of cooperation 19 among the Valley stakeholders. As you know, it's 20 unprecedented for a district to voluntarily matriculate 21 itself to the extreme designation. And it was something 22 that was not done lightly in the San Joaquin Valley. 23 There was a great deal of effort in understanding and the 24 implications of understanding the responsibilities that 25 took place over an extended period of time. And as it was PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 49 1 noted, on October 8th our board unanimously approved the 2 plan that you have before you today. 3 This plan demonstrates attainment to the 1-our 4 ozone standard by November 15th of 2010. And it sets the 5 course for a whole list of planning objectives and 6 rule-making down the line that will take place over the 7 next several years. And this plan, as was noted, is 8 highly integrated to our ongoing efforts to achieve the 9 8-hour federal ozone standard, and it does incorporate 10 many of the measures that we have already approved in our 11 PM planning effort. 12 This plan also meets the federal rate of progress 13 requirements for the years 2008 to 2010. 14 It should be very obvious, and I know it is from 15 some of your questions thus far, that the efforts to 16 improve the air quality in the San Joaquin Valley are 17 absolutely a partnership, the efforts of the local 18 district combining with the efforts of the California Air 19 Resources Board and combining with the efforts of the 20 federal government. Transportation-related emissions are 21 predominant, emissions that we're focusing on. And as 22 made clear earlier by Dr. Lloyd's questions, federal 23 sources of interstate commerce, trains, trucks, boats and 24 planes, are a very significant issue for all us in 25 California. And it's imperative that collectively as PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 50 1 California we beseech the federal government to ramp up 2 progress that they're making so that we might achieve 3 these goals that we've laid out. 4 I urge your support of this plan. Again, it is 5 historic and not one that we entered into without 6 tremendous deliberation. 7 I'd also as an aside like to thank Ravi 8 Ramalingam for his service to our district over the years. 9 And welcome Doug Ito to fill Ravi's shoes. And I was able 10 to say Ravi Ramalingam. It took me three or four years to 11 be able to say that. Ravi was great. Whenever we would 12 mispronounce his name, he would turn it around and 13 mispronounce our names. 14 Thank you very much. 15 CHAIRPERSON LLOYD: Thank you very much. 16 Thank you, David. Again, I congratulate you on 17 renewed efforts here to clean the air. And we realize 18 it's a challenge. But clearly in the last couple years 19 we've seen a significant change in commitment, you know, 20 reflecting obviously the health impacts of air quality 21 here. So appreciate it very much. 22 Do we have any questions for Dave? 23 No. 24 David Mager, Manuel Cunha, Diane Bailey. 25 MR. MAGER: Good morning, Mr. Chairman and PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 51 1 members of the Board. 2 First I want to congratulate you and thank you 3 for the passage of the Vehicular Greenhouse Gas Emissions 4 Reduction Initiative that you recently passed. 5 And I'm here to support this SIP and the 6 15-ton-per-day production from livestock waste. And the 7 reason I'm here to support that is because it's 8 attainable. Bion has a technology that can mitigate most 9 releases to air and water associated with livestock. This 10 technology is installed on 18 dairies, the largest of 11 which is 3700 cows. The most recent is 1,250 cows. And 12 on that facility all of the inputs and outputs were 13 measured over a period of seven months using a testing 14 protocol that was peer reviewed and accepted by the San 15 Joaquin Valley Air District. The results from that 16 mirrored results in previously published peer-reviewed 17 documents, which shows no technology has greater 18 reductions of emissions to air and releases to water. 19 The San Joaquin Valley has a test of technology's 20 viability under APR 1035-2. And for VOCs that's $5,000 21 per ton. And this technology handily beats that. 22 If this technology were installed in the dairies 23 in San Joaquin Valley, the entire 15-ton-per-day goal that 24 you set for the SIP could be met. And in addition to 25 that, all of the carbon dioxide emission reductions goal PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 52 1 you have for the vehicular program could be met as well. 2 Thank you. 3 CHAIRPERSON LLOYD: I have a question. 4 I was just going to ask for a layman's 5 description of your technology. 6 MR. MAGER: Sure. It involves a -- it's not an 7 anaerobic process or an aerobic process. There is a -- 8 what's called a sweet spot, somewhere in between process 9 that calls for conditions of very little oxygen but not no 10 oxygen. And in those conditions the bacteria that we 11 introduce use hydrogen and phosphorus as a substitute. So 12 they're breaking down the nitrogen materials. And so this 13 process, by the way, also has virtually no releases from 14 ammonia and H2S. 15 So essentially if it's a scrape dairy or a flush 16 dairy, this culture of bacteria gets flushed through the 17 flush lane and the material bioconverts with the -- and 18 assumes all of the manure. And then it converts all of 19 those wastes into solids which are recovered and in fact 20 they become a fertilizer. 21 CHAIRPERSON LLOYD: So where is Bion located? 22 MR. MAGER: We're in New York. I'm from 23 Massachusetts, the home of the Red Sox. 24 (Laughter.) 25 BOARD MEMBER DeSAULNIER: What a way to PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 53 1 celebrate. 2 CHAIRPERSON LLOYD: So you have any presence in 3 California besides dairies here? 4 MR. MAGER: That's our intention, is to -- now 5 that the passage of SB 700 and there's a requirement to 6 address the air, emissions from dairies, and given that 7 they're about a third of the cows in this -- here, that's 8 exactly what our intention is. 9 CHAIRPERSON LLOYD: So the Governor's bus has 10 been back to New York to bring you back, to bring you over 11 here? 12 (Laughter.) 13 CHAIRPERSON LLOYD: Yeah, this seems very, very 14 attractive. 15 How many dairies are currently using this 16 technology? 17 MR. MAGER: There's 18 dairies. And, again, the 18 largest is 3700 cows, which is the range of the dairies 19 that we see around here. 20 CHAIRPERSON LLOYD: Questions? 21 BOARD MEMBER DeSAULNIER: Does your employer know 22 that you're from Massachusetts? 23 Never mind. 24 CHAIRPERSON LLOYD: Ms. D'Adamo. 25 BOARD MEMBER D'ADAMO: A couple of questions and PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 54 1 a comment. 2 You explained the technology very well. What 3 about the infrastructure? Do the lagoons that are on most 4 dairies stay in place and be -- with the current systems? 5 MR. MAGER: Yeah, this -- this technology can be 6 built on to new facilities or it could be easily 7 retrofitted on to existing anaerobic facilities. The 8 hydraulic retention time is less. So, for instance, in a 9 recent facility a 10-acre lagoon was shrunk to about an 10 acre to handle all the -- 11 BOARD MEMBER D'ADAMO: All right. And then 12 state, federal, or local funding, have you received any 13 money on the projects that you have? 14 MR. MAGER: We have not yet. We believe that the 15 technology will be qualified for the EQIP Program under 16 the USDA very soon. 17 BOARD MEMBER D'ADAMO: And then just a comment. 18 MR. MAGER: It would be a -- USDA is working on a 19 standards for mitigation technologies now. 20 BOARD MEMBER D'ADAMO: And then just a comment. 21 I believe your company was at a recent seminar that the 22 local government commission put on. I think there was a 23 woman there representing your company. Anyway, just for 24 the other Board members' information, U.S. EPA has formed 25 the San Joaquin Valley Dairy Manure Collaborative. The PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 55 1 name may need to be changed. 2 BOARD MEMBER DeSAULNIER: Quick, give us the 3 abbreviation. 4 BOARD MEMBER D'ADAMO: But they are working with 5 other state and federal agencies as -- specifically Cal 6 EPA. And the idea is to put together greater information 7 for use on these various technologies and hopefully 8 eventually a funding stream in order to get them on line 9 sooner rather than later. 10 Thank you. 11 MR. MAGER: Thank you. 12 CHAIRPERSON LLOYD: Just from your comments, you 13 have to go through certification with the EPA or USDA, or 14 you will be going through certification -- 15 MR. MAGER: I don't believe there's a 16 certification process for that. For the USDA there is a 17 process for qualifying technologies for the EQIP loans. 18 And then there's still the BACT programs. 19 CHAIRPERSON LLOYD: Is this expensive technology? 20 MR. MAGER: No, it's -- we see with the amount of 21 pollution that this mitigates, it actually pays for itself 22 with an expansion of the hertz size on the same footprint 23 of just 4 to 8 percent. So in other words, with this 24 large reduction that you can accomplish, you could 25 actually pay for the system with -- and, again, it's about PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 56 1 less than $500 per cow, a specific number. 2 CHAIRPERSON LLOYD: Thank you. 3 MR. MAGER: Sure. 4 CHAIRPERSON LLOYD: Manual Cunha, Diane Bailey, 5 Brent Newell. 6 MR. CUNHA: Good morning. I'm Manual Cunha, 7 President of the Nisei Farmers League; as well as a member 8 of the United States Department of Agriculture Air Quality 9 Task Force that was put into law in 1996 by Congress so 10 that USDA would have -- the Secretary of Agriculture would 11 have an advisory committee to advise him or her on air 12 quality issues, just like EPA has an advisory committee. 13 But on behalf of the Nisei Farmers League, 14 I've -- if I could just take a quick second. What I'm 15 passing out to some of you is the Conservation Management 16 Practice booklet that the agriculture industry partnered 17 with NRCS, which is a very important part of our USDA, 18 Natural Resource Conservation Service, and the San Joaquin 19 Valley Air District and ARB. We put together a thing 20 called Conservation Management Practices. EPA uses the 21 term "best available" or "best management." It's very 22 difficult to tell a farmer that this is the best, because 23 he may have something else. And, plus, conservation is 24 what agriculture lives on across the country. The farm 25 bill is based on conservation versus best. So we've come PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 57 1 up with conservation management practices. 2 This was a grant that we got through NRCS to 3 develop this booklet. 4 The other item you have before you is a thing 5 called partners magazine. Some of you may not have. We 6 ran out of copies. We ordered 20,000 of those. We did 7 send 50 copies of these to the Air Resources Board, along 8 with others. We will do a follow-up with this magazine 9 this coming year, summer of 2005. It will show the 10 results of -- by charts and formulas, how much reductions 11 we have gotten from our conservation management practices. 12 There's over a hundred in that booklet in that blue 13 tri-fold open. 14 But, again, I just want to bring to your 15 attention, that was a second effort after Regulation 8 16 that this air district adopted for PM10. It was again put 17 on by agriculture developing on educational material for 18 our farmers so they could understand in layman's terms. 19 Not taking away the technical staffs of both air district 20 and ARB, but farmers need to have it on a basis that is 21 easier. And nothing against our attorney, please. Would 22 not want that to be taken the wrong way. 23 But, again, voluntary measures that farmers came 24 together and put this magazine together. We are now going 25 to be developing another set of workshops on the CMP's in PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 58 1 December. We held in June. And the board adopted this in 2 May, on I believe the 21st. On the 25th of May we printed 3 this. We printed 40,000 copies. And had 18 workshops in 4 three weeks. And they averaged four hours a day. We did 5 a morning and night workshops put on by the ag industry, 6 NRCS and this district. The San Joaquin Valley District 7 did a tremendous job of having your staff available at all 8 these workshops. 9 Again, the staff that went to the workshops came 10 off of the technical bureaucratic level and came down to a 11 level that farmers appreciated very much. And it was 12 tremendous support from our industry granting -- or 13 thanking the district because they did a great job. 14 Again, that's just one item to show you that the 15 ag industry is very seriously looking at air quality. It 16 is an important issue for us. California is going to be 17 against stepping out in front of all the rest of the 18 nation. And I bet you we will get in trouble for that, 19 but that's okay, just like we step out in front on a lot 20 of things. 21 But on this I do want to thank Dr. Lloyd and the 22 Board, your staff -- Lynn Terry and many of the staff. 23 Catherine Witherspoon and Bob Fletcher, Peter Venturini. 24 Patrick Gaffney has come a long way. That young man has 25 lost a lot of weight over the last several years with us. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 59 1 But he has done a tremendous job in working with us on the 2 inventories and all that. So I do want to pay respect to 3 your staff working very hard with agriculture. 4 As well as the air district of San Joaquin 5 Valley. Mr. Crow and his staff have been just absolutely 6 outstanding to work with. We don't all agree, but at 7 least we have an understanding of working together and 8 communicating to making it a process that works. 9 Now, I'm here today to support the ozone plan. 10 You'll have to excuse me. I have to get my 11 glasses out, because all the government documents have 12 caused these problems. 13 CHAIRPERSON LLOYD: You're not eating enough 14 almonds there. 15 MR. CUNHA: Pardon? 16 CHAIRPERSON LLOYD: You're not eating enough 17 almonds. 18 BOARD MEMBER DeSAULNIER: Proper pronunciation. 19 MR. CUNHA: Almonds (Amonds). Almonds (Aulmonds) 20 is when they're on the tree and you knock the "L" out of 21 'em. 22 BOARD MEMBER DeSAULNIER: We're hearing the Welsh 23 pronunciation. 24 MR. CUNHA: Again, the first thing is we do 25 support the plan. The staff has done a tremendous effort PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 60 1 of outreaching workshops. Yes, it was short time comment 2 periods, but being confronted with many other things in 3 this basin from Regulation 8 to PM10 to 8-hour standards, 4 working on that, the one-hour standard. There's a just a 5 lot of things going on in this basin. 6 The first thing is on the plan, I would like 7 to -- and I'm going to go page by page, Dr. Lloyd, on just 8 4 item areas. But I think I need to. If not, I will lose 9 control of what I'm trying to get across here. 10 The first one will be under 3.24, Emissions 11 inventory uncertainty. The staff has, at the last Air 12 Board meeting, the Board took great amount of discussion 13 about NAFTA. And in there, there was a section in which 14 they will be discussing and incorporating NAFTA. NAFTA 15 meeting to me with this air district is the trucks. The 16 amount of trucks that will be coming in from the 22-mile 17 limitation that was invoked in 1992 by the President of 18 the North American Free Trade Agreement allowed those 19 trucks to start rolling in '95. Those trucks have not 20 started rolling through the states. They stopped 22 miles 21 into California, unloaded and go back across. Then our 22 trucks pick up the products, whatever it is and move it 23 forward. 24 The Supreme Court ruled in June very clearly 25 those trucks must start rolling period. NAFTA only really PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 61 1 dealt with the major issue of safety. It did not address 2 the air quality those type of environmental type issues at 3 all. Most of even the WTO, and upon what the WTO could do 4 down the road, will be another issue as somebody talked 5 about ships, that come in from foreign countries, do they 6 really have those type of technologies for their own 7 ships. 8 But be it said, I think I just want to thank the 9 staff for including that part in this plan that they are 10 going to really look at NAFTA working with this Air 11 Resources Board. I do appreciate the Governor signing the 12 legislation to allow the ARB to deal with the truck issue. 13 In this basin, it's going to be the I-5 corridor 14 and the 99. And today as you go down the 99, it's more 15 trucks than there is cars. And that is going to increase 16 my numbers from my source just like the newspaper, is that 17 it's 1.5 million miles a day added as soon as those trucks 18 start rolling from Mexico. And that has a major impact 19 for us for air quality, I believe, to the standards in 20 which they must meet and follow. It's going to be very 21 important. 22 If we're telling businesses, farmers clean up 23 their engines and we're telling schools to clean up their 24 busses and our trucks, then what is the difference of not 25 making sure those folks come across through Los Angeles PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 62 1 and through this basin. Definitely, the trucks will not 2 go through San Francisco, through 101 or 580. I think 3 they would be having to see psychologists after they try 4 to get through the type of congestion that would occur. 5 So we know they're not going to do that, so San Francisco 6 is safe. 7 BOARD MEMBER DeSAULNIER: There are a lot of 8 therapists in San Francisco. 9 (Laughter.) 10 MR. CUNHA: We may need some over here. But 11 again, it is an important issue for us, so I appreciate 12 the staff on that issue of addressing it and making it 13 part. And I'd hope the Air Resources Board continues with 14 its vigilance of dealing with this issue. The Department 15 of Transportation Secretary will be here in November I 16 understand to talk with the agriculture industry, the air 17 district. And it's invited some folks to address the 18 NAFTA issue, because we have also a pest issue under AFIS, 19 in which these trucks will not properly be inspected to 20 allow the fruit fly, oriental fruit fly, moth -- if those 21 critters get into this Valley, unload a truck and it's 22 never been inspected, it would be a disaster. You could 23 lose 75-mile radius, which could be close to an $8 billion 24 impact on this Valley, just alone for ag. So again, 25 that's a separate issue from this but again I appreciate PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 63 1 the staff's effort. 2 Also, we talked about -- there was discussion 3 about rails. The agriculture industry in this Valley, 4 including George Sores Conway, by working with the Port of 5 Oakland. And in that process is to deepen the Port of 6 Oakland from 44 feet to 50 feet, which will take a ship 7 that caries 2,500 to 3,500 containers will be able to 8 carry 8,000 containers. They're called the new ships of 9 the future. 10 Those ships will carry that many containers, but 11 they have the new cleaning burning engines, which is very, 12 very important to the issue of transport for both the Bay 13 Area as well as the San Joaquin Valley and even the 14 Sacramento Valley. 15 The ag Industry is its largest client, is the 16 Port of Oakland. We are their single largest client. The 17 agricultural product that is the biggest, that I think all 18 of us enjoy, I believe, is wine. Wine is their largest 19 single agricultural commodity that goes. And the next is 20 the fruits and vegetables that we have as well as cotton 21 and other products. 22 The ag industry is working with the Port of 23 Oakland also on a train system, called the Sears Project. 24 That Project will allow, working with Burlington Railroad 25 And the Department of Transportation and the District here PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 64 1 along with EPA upon its new funding called Regional 2 Diesels Partnership Program. We hope that they will fund 3 part of this project. 4 What that is that the rails will pick up 5 containers out of the Valley. It would stop, for example, 6 in Modesto. It would be in Fresno and Shafter. The 7 concept is that we can eliminate truck-carrying containers 8 over to the bay area or over the Altamont Pass. 9 For an example, let me give you what one train 10 will hold. One train will hold 251 containers, which will 11 eliminate 1,200 truck trips for those containers. One 12 train can carry that many containers and would eliminate 13 that many trucks. I am not advocating going against the 14 trucking industry no. But when we all have to do our part 15 for cleaning up the air, then that has to be looked as the 16 very means of also. 17 Again, the ag industry is working very closely to 18 put a distribution point out of Coalinga, in which many of 19 the containers would be delivered out in the Coalinga 20 area, between them and Kerman, which would help eliminate 21 many truck travels from out there into Fresno and 22 distribution. And locking at a new distribution point 23 somewhere between here and Madera, a landing area in which 24 those vehicles would then be picked up by natural gas 25 driven trucks. That's the concept that would pick up the PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 65 1 containers from the farmers, deliver them, and if the 2 distribution point is out in Coalinga, then the train 3 would automatically go out that way. There's 2 rails. 4 They both are 40-mile an hour rails. And they can, 5 working with Burlington Railroad and other folks, to 6 develop that down the road. So there is tremendous 7 movements on that project with agriculture and the Port of 8 Oakland. 9 Agricultural burning, SB 705. SB 705 only 10 addressed agriculture in the San Joaquin Valley. 11 Agriculture from the Air Resources Board 2002 Inventory 12 showed agriculture was 23 to 27 percent of total smoke, 13 out of the inventory. Seventy-three percent of the smoke 14 that was remaining -- and there was 3 other percent from 15 other sources -- but 73 percent of the smoke comes from 16 parts and forestry burning. 17 So if we're going to continually go down the road 18 with the State Air Resources Board and this district, 19 making sure this district has the authority and the 20 opportunity to control smoke from parts and prescribed 21 burns or forestry that that be part of the entire SIP plan 22 for the State. If in fact the feds do not want to 23 cooperate with the San Joaquin Valley district, then I 24 would hope the Air Resources Board would take control. 25 Because if agriculture is going to reduce its 23 PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 66 1 to 27 percent by -- let's say 20 percent, because we are 2 going to have to burn. In our industry there will have to 3 be some burning. But if we reduced it, lets say, by 2010, 4 by 20 percent, you still have 73 percent out there that we 5 need to deal with. And that definitely is transported. 6 So I would hope that in the State SIP that we 7 look more at the prescribed burns in all those areas. 8 This district is doing a job of smoke management. But I 9 believe in my findings and hearings they've had some 10 complications with the feds The feds believe that they 11 don't have to comply with any law, in most cases. And 12 again that's not going to happen. 13 If I'm going to clean up something dang well 14 those feds are going to do their part. Excuse that tone. 15 The other part that we need to worry about is the 16 WRAP, Western Regional Air Partnership, in which you have 17 13 states dealing with transport of pollutants coming from 18 other states, from burns, from wild fires, prescribed 19 fires, agricultural fires and other pollutants that 20 transport across through this state. 21 So I think we need to be watching very carefully 22 what the WRAP is doing, and how does that affect into our 23 State SIPs as well as even the one-hour standard that's 24 going to come up. Because transport was discussed this 25 morning, not just from the Bay Area or the Sacramento or PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 67 1 from the San Joaquin Valley maybe dumping into Edwards Air 2 Farce Base or something else that we may be doing, but I 3 think we need to look outside of what transport is coming 4 in from other areas, especially if Oregon's Volcano did 5 erupt, St Helens, what type of emissions would that do 6 with our Valley or even with Sacramento or even the Bay 7 Area. So I would hope that we look at that as well in the 8 future for the State. 9 The San Joaquin Valley Air District is doing -- I 10 give them a tremendous amount of credit of working with 11 agriculture on the open burn program that we are working 12 with the staff. And I want to make this on the record. 13 This was all being done before 705 was ever implemented. 14 There was an ag burn committee. And we were working very 15 closely with the District on reductions of agriculture 16 burning due to using the bio facilities if we can't 17 continually work with those as well as incorporation of 18 product into land in ornamental uses. 19 I'll make this real quick. 20 CHAIRPERSON LLOYD: I was just going to ask staff 21 while you're moving on, on the ag issue, how do we see 22 that? Are we working with the feds or have we gotten into 23 that issue are we're trying to work together on that? 24 EXECUTIVE OFFICER WITHERSPOON: You mean both the 25 burning and the WRAP? PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 68 1 CHAIRPERSON LLOYD: Well burning I was 2 particularly interested in. 3 EXECUTIVE OFFICER WITHERSPOON: Yeah, Lynn's been 4 tangling with the feds for the last several months. Do 5 you want to -- 6 DEPUTY EXECUTIVE OFFICER TERRY: Sure. A couple 7 of years ago we established a working group among all of 8 the area agencies and the federal land managers. It was a 9 statewide group but the focus really has been the San 10 Joaquin Valley. So the technical folks have been working 11 together. We've worked on protocol for the situations 12 where the federal land managers like to make use of wild 13 fires that turn into prescribed burn. We've worked with 14 protocol on what to do there. 15 There will always be differences of opinion among 16 the technical staff as to when is it appropriate to burn. 17 And that's really the focus of our efforts is to make sure 18 that we come to agreement on that and conflict resolution. 19 But we're not there yet. It's a really hard path to go 20 down to get agreement on the need to address both air 21 quality and their need to burn for forest health reasons. 22 CHAIRPERSON LLOYD: Ms. D'Adamo. 23 BOARD MEMBER D'ADAMO: Just a follow up. If 24 you're not there yet with the federal agencies, what about 25 the State agencies, Forestry, Parks. Do you have a PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 69 1 protocol? 2 DEPUTY EXECUTIVE OFFICER TERRY: Yeah, actually I 3 should -- it's not just the federal. The State agencies 4 participate in that working group as well. 5 BOARD MEMBER D'ADAMO: Do you have a protocol 6 that's in place for the State agencies? 7 DEPUTY EXECUTIVE OFFICER TERRY: Not -- I do 8 believe and I'll throw it to Bob. They are not signators 9 to the agreement. But they have participated in the 10 meetings. And when we adopted our smoke management 11 Regulation in 2000, they were very active in that process. 12 And I think that was really the turning point for 13 developing this mutual understanding of what their 14 mandates are and what air agency's mandates are, and the 15 fact that we need to work through those issues. 16 And on the positive, they have put a lot of 17 resources, the land managers, into meteorologists to do 18 some additional monitoring when they're doing burns. So I 19 think there's a recognition of needing to work with us, 20 but it's going to be an ongoing process. 21 MR. CUNHA: I appreciate that. I think we don't 22 want to see the San Diego Fires in the San Joaquin Valley 23 or even in the Sacramento basin. So I think the Senator 24 Feinstein's and those folks's forest management program in 25 allowing the logging and those type of activities to PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 70 1 continue and improve, I think that would be a benefit 2 of -- but we don't need another San Diego fire in the San 3 Joaquin Valley to destroy Yosemite and others, because we 4 don't allow logging or proper management. 5 But again, Lynn, I appreciate that. We just need 6 to keep the State agencies and the federal agencies 7 responsible for their part. If not, it's not right for 8 just industry and the local agencies to do all theirs when 9 the feds can just do what they want. I think that's 10 inappropriate behavior. 11 The last, 4.40 is Sustainable Incentives. This 12 is a big issue for all of us. And, again, I want to give 13 support to the Air Resources Board staff, the San Joaquin 14 Valley to go outside of the box, to look at other ways to 15 reduce the emissions without having to have mandatory 16 regulations or mandatory requirements on things that 17 aren't going to get the type of sustainable reductions we 18 want. 19 So I think this part is very, very important, 20 such programs as Operation Clean Air, bringing all 14 21 different industry groups working together on an incentive 22 basis, to do empowerment zone areas, to allow counties to 23 get funds to help do more creative things, but on a 24 voluntary basis. 25 And also looking at other ways to reduce PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 71 1 emissions by giving industry the flexibility in the rules 2 to allow that to happen. So from the ag side, 3 sustainability or incentives of this type are important. 4 Carl Moyer, again I want to thank Dr. Lloyd your staff, 5 the Governor, and Chuck Poochigian, Louis Brown and George 6 Sores and even Barbara Lee, for the efforts of working to 7 get Carl Moyer through that night. 8 By the end of that night, Senator Poochigian was 9 able to work out the type of thing that agriculture needed 10 to make sure they were part of that equation to help our 11 farmers down the road. 12 So I definitely want to thank those 3 people, 13 because I know there were there until 3 in the morning 14 trying to get that. Dr. Lloyd your staff was very 15 helpful, and along with the Governor. We thank you for 16 that. Again We, we appreciate you allowing this to 17 happen. So again Thank you. 18 Just about done, Dr. Lloyd. Just about done. 19 CHAIRPERSON LLOYD: I've lost count. I thought 20 you said 4 points. 21 (Laughter.) 22 MR. CUNHA: It was four pages. This is a big one 23 52 million, or 3029.5 million or 500,000 I think the PM10 24 study, but we did get to 31 million. Ozone 1 which was 18 25 million in 1986 started under Jan Sharpless and others. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 72 1 And now we're on Ozone 2, which was about 12 million, I 2 guess, somewhere around there. And ozone 3 is coming on a 3 short way after staff creates more ideas for more 4 modeling. 5 But again I appreciate the air district board 6 last week or a couple weeks ago allowing more information 7 to be granted in the document to give credit to the study. 8 The study agency, the policy committee, the staff of the 9 ARB, that's a lot of money to spend for PM10 models to 10 understand what's going on, ozone models. And I do have 11 to say in front of you as a board, you've created probably 12 the highest credibility of research models in the country. 13 Bion with New York use the IMS95 models for PM 10. Also, 14 New York used the ozone 1 information that was developed 15 from California. 16 So again what this ARB is doing with the air 17 districts and industry, developing models of research that 18 really can be used by other air districts to me is a real 19 positive direction and something that I would say I 20 appreciate all of the work that all of you people have 21 done with this. And I appreciate more information on that 22 and the staff has done that, Dr. Lloyd, and I appreciate 23 that. 24 Mr. Crow is really lucky this would never happen 25 to me during his presentation ever. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 73 1 (Laughter.) 2 MR. CROW: Don't get him any water. 3 (Laughter.) 4 MR. CUNHA: The last is biogenics. A big issue. 5 I appreciate the staff putting the white paper. This 6 white paper was developed by the request of Dr. Lloyd in 7 2002 by the Agriculture Advisory Committee that Dr. Lloyd 8 and his assistant, when he's not there, is DD, and of 9 course Catherine Witherspoon, and Lynn Terry are part of 10 making sure that ARB is there to hear what agriculture -- 11 what is going on. 12 But biogenics is a big important issue for all us 13 in the state and across the country. But we must be very 14 careful about biogenics. Many, many years ago if you took 15 away what was here in this basin, it was tules and wild 16 grass and a tremendous amount of fires. Many of the 17 agricultural plants and some ornamentals of areas do help 18 clean up the air. 19 So I think if we're going to go down a road and 20 we're going to look at what do plants do for the 21 environment, we also must look at what do plants do for 22 erosion? What do they do for the type of protection of 23 our soils? 24 We also have to consider that, because certain 25 plants are planted only for the purpose of erosion PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 74 1 protection. Because they have a vigorous root system, 2 they help control the erosion of soils due to weather 3 conditions or whatever. 4 But again, I want to thank the staff and Dr. 5 Lloyd for allowing this activity to go forward in 2002 to 6 put together a constructive group of people to look at 7 this. And I think it's important for us to look at, but 8 we must be very careful at how we look at biogenics, and 9 how we deal with nurseries, people that grow plants for 10 ornamental purposes, et cetera. 11 And I just want to say in conclusion, it's been a 12 pleasure working with your staff, Dr. Lloyd, and the 13 Board. I think Catherine Witherspoon, Lynn Terry, Bob 14 Fletcher, Peter Venturini, and Patrick Gaffney those 15 people have given the ag industry the support we need when 16 we've asked for it. 17 Sometimes we don't agree all. But that's okay, 18 that's what a democracy is about. And in the San Joaquin 19 Valley, I appreciate their efforts and the new effort 20 being put forth by EPA, Region 9 of wanting to work closer 21 with us on issues. And I think that's important. If 22 we're going to get through this plan -- and, Dr. Lloyd, 23 your safety-net issues I think are important, from 94 to 24 99. And there are some folks behind me that are probably 25 going to oppose the plan, because they're going to have PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 75 1 some reasons why that they should go forward, I believe. 2 But that's okay. But I think what the staff has 3 prepared in this document and all of us working together 4 with Operation Clean Air, OCA, with all of the 53 cities 5 in this basin all working to clean up the air together, 6 agriculture doing its part, economically, feasible and 7 technologically available, ag will be there. 8 Bion. Bion, Dr. Lloyd, by information was 9 working with Fresno State on putting the activity at 10 Fresno State to work. Due to bureaucracies between the 11 State and university levels, that project did not take off 12 as fast as it should have for Fresno. But I do appreciate 13 the gentleman's comments, that technology, I think, is 14 something we need to look at. I think it has some real 15 merits of what Bion is talking about. 16 But again we must be looking at economics, 17 because a farmer cannot pass on the cost to the public. 18 He cannot or she cannot. 19 Again, thank you very, very much for coming to 20 the great San Joaquin Valley. I appreciate the staff 21 getting in the mud yesterday. And, Dr. Lloyd, I want to 22 let the Board know your staff is not afraid of mud. 23 They're not afraid of going out and walking and suddenly 24 sinking into their ankles. 25 But, again, we appreciate the efforts of you PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 76 1 folks being down here in the Valley and holding your 2 meeting here. Again, thank you. And, Barbara, thank you 3 very much for the representation from our air district, in 4 being on the Board. We appreciate that very much. 5 BOARD MEMBER PATRICK: Thank you. 6 CHAIRPERSON LLOYD: Thanks for your efforts. One 7 question, I got the message vis a vis regulation and 8 incentive. And, of course, we very much value Carl Moyer 9 and appreciate that Governor's support of that and the 10 Legislature. That's great. 11 But I hadn't thought about Operation Clean Air 12 recently. How many tons has Operation Clean Air taken out 13 of the air today? 14 MR. CUNHA: Well, they really have just got 15 started. They're doing a tremendous amount right now of 16 outreach and education. They did receive a $500,000 grant 17 to deal with trains and buses on synchronizing where folks 18 can get from smaller communities. And that was with the 19 Department of Transportation. 20 Hey're in their first, really, I guess second 21 year. And they have not identified any real tons. But 22 what is great about this group, Dr. Lloyd, is you have 23 14 -- you have the Lung Association, you have the 24 builders, you have the construction industry, you have 25 CalTrans, you have various groups all coming into a room PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 77 1 working together to go out beyond what the air district is 2 doing or what ARB is doing and to come up with other ideas 3 that they can promote that doesn't require regulation. 4 But what this does is that it brings all groups 5 together to work together versus fighting and arguing and 6 suing each other. This is a group that wants to achieve 7 things on a voluntary basis, and maybe in another year 8 we'll be able to give you some of that information. But 9 right now, I think it's just outreach and trying to get 10 people to work and do things beyond the norm. 11 CHAIRPERSON LLOYD: Another particular viewpoint, 12 we've got to get tons out of the air, so we can make 13 breathing easier. So I hope that that comes to fruition. 14 MR. CUNHA: That's definitely their goal. The 15 last thing on funding, the Natural Resources Conversation 16 Service Equip funding is designed in the farm bill for 17 farmers. That money, by Congress, in 1930 something was 18 there to give farmers money. It does not fund individual 19 entities such as research areas. It does not fund 20 commercial businesses. It funds and gives money to 21 farmers directly. 22 Now, the Bion is referring to there is grant 23 monies in ARS or CREES to help fund some of these type of 24 research projects. And that's part of the task force to 25 continue on down the road, to get more funds to do PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 78 1 research such as what Bion is talking about. But the 2 incentive monies that Bion is talking about could be used 3 for the farmer to purchase the type of technology and use 4 it for the purpose of what it is, and that's reducing 5 pollution and not anything else. 6 So thank you. 7 CHAIRPERSON LLOYD: Thank you very much. We've 8 Diane Bailey, Brent Newell and then Teresa De Anda. 9 MS. BAILEY: Good morning, Chairman Lloyd and 10 Members of the Board and staff. I just want to note that 11 I'm pleased to see some new faces and old faces as well. 12 My name is Diane Bailey, and I'm a scientist with the 13 Natural Resources Defense Council. And thank you for the 14 opportunity to speak here today. 15 I'm here today because air quality in the San 16 Joaquin Valley is really a priority to us just as our 17 other priorities on diesel climate change, land use and 18 environmental justice. 19 And I regret not being able to participate in 20 this planning process sooner, but we did prepare comments 21 together with Earth Justice and I have them with me here 22 today, some written comments. And my apologies for not 23 getting them to you sooner. 24 Earth Justice and NRDC are very concerned over 25 the SIP and the generally slow progress towards better air PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 79 1 quality in the Valley. And so we're submitting these 2 written comments on behalf of a number of environmental 3 and health groups today. And I just received a call that 4 Latino Issues Forum have also signed on in support of 5 these comments and concerns. 6 We're not saying that we're opposed to the plan. 7 We're only saying that we're concerned with a lack of 8 stronger measures, and certain aspects of the plan. And 9 we go into those details in our written comments, so I'll 10 be brief here today. 11 Our biggest concern is really that the SIP does 12 not do enough to improve air quality fast enough in the 13 Valley. And while the one-hour ozone attainment deadline 14 is not until 2010, The Clean Air Act does state clearly 15 that their attainment should be reached as expeditiously 16 as practicable. And so I hope that we can do everything 17 that we can as soon as possible and not wait till 2010, 18 and not wait till the 2013 8-hour deadline. 19 We would really like to see some more leadership 20 from the ARB and partnership with the air districts as 21 we've seen in the South Coast, where they've experienced a 22 faster rate of improvement on their air quality. And we'd 23 also like to see a sense of urgency among this Board. 24 There is a sense of urgency here in the Valley. 25 And that's because the Valley is in a health crisis right PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 80 1 now, a very serious health crisis. And just one example 2 of that is right here in Fresno, 1 in 5 children have 3 asthma. And I'm not going to rattle a litany of 4 statistics at you. I think that you've heard them already 5 and that you understand the health crisis here. 6 But I do just want to point out that it is 7 related to the air quality, the ozone specifically, and 8 other pollutants as well. And that this is really taking 9 a toll on people, not just in terms of diminished quality 10 of life, but also financially. And so that could end up 11 having impacts on business and other impacts as well. 12 Another large concern that we have with the plan 13 is that it doesn't do enough to control large industrial 14 agricultural sources and pesticides CAFOs that has 15 confined animal feeding operations are really some of the 16 largest sources of ozone precursors in the Valley. 17 And the measures that are included in the plan 18 seem somewhat weaker and vague -- and more vague than some 19 of the other measures that we've seen. So what we're 20 really urging you to do is take a stronger look at the 21 industrial agriculture. We're not asking you to look at 22 the smaller family farms, but to attempt to regulate and 23 clean up these industrial agricultural resources, which 24 can also be major sources of air toxics, particularly the 25 pesticides, and regulate them at the same levels as we're PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 81 1 seeing other industrial regulations. 2 Another issue that I want to highlight is the 3 10-ton per day shortfall. That is 5 tons of NOx and 5 4 tons of VOCs. And we're a little concerned about the 5 potential measures that are listed in the plan that these 6 aren't particularly well thought out. There aren't a lot 7 of details. And there may be some real feasibility 8 challenges with them. And so we would urge you to take a 9 stronger look at those measures. 10 And another issue with the measures is that 11 they're also relied on as contingency measures. And so 12 this might, in effect, be a form of double counting and 13 added risk that the attainment may not be met on time. 14 I want to note that I appreciate the discussion 15 on intermodal cargo that went on earlier and the air 16 quality impacts of that cargo in the Valley as opposed to 17 coastal areas. I hope that future plans can better 18 address those cargo issues, because I do think that there 19 are some pretty serious implications in the Valley with 20 the major ports growing at the rate that they're growing. 21 Cargo may triple in the next 10 or 20 years. And this may 22 lead to some serious impacts from the trucking and rail 23 here in the Valley. 24 And I also wonder if air cargo hubs might grow in 25 the Valley as congestion increases in the coastal areas, PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 82 1 and at what rate the distribution centers will grow. I 2 think that Manuel mentioned a project that the Port of 3 Oakland is interested in with Valley distribution hubs, a 4 rail project. And I think that actually may be common 5 grown between us. And that hopefully we can work together 6 to explore projects that take dirty trucks off the road 7 and replace them with rail between the coastal cities and 8 the Valley where a lot of distribution centers are 9 growing. So I hope to see more efforts on cargo in future 10 plans. 11 And finally I'd like to mention chip reflash. 12 And unfortunately, I can't be here later today when this 13 item comes up, but I just want to briefly say that we are 14 very disappointed with the progress towards the voluntary 15 program goals. And I think this really highlights the 16 problem with voluntarily programs that they seem to 17 consistently under achieve. And in an area like the San 18 Joaquin Valley, where we're struggling so much to attain 19 ozone standards, it's just particularly disappointing that 20 these trucks continue to pollute more NOx than they're 21 allowed, while we struggle to meet the ozone standard, and 22 to see the very severe health impacts. 23 So what we really hope to see is that in December 24 that this Board can implement the regulatory backstop to 25 fix this rule. And I hope that we can all work together PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 83 1 on future ozone plans and move forward faster than the 2 deadline, because I think the health crisis here really 3 calls for that. 4 Thanks. 5 CHAIRPERSON LLOYD: Thanks Diane. I hear your 6 comments I. I think your comments obviously on the goods 7 movement and what not, we're working on that tough issue. 8 So I'm sure staff is right on top of that are there. 9 Chip reflash, yeah, we'll hear more about that 10 this afternoon. But you say you've got another crack back 11 at that. 12 The other part you mentioned on that, have you 13 been out to visit one of the facilities. 14 MS. BAILEY: I have. I visited -- I've driven by 15 several. And I have not had on-site visit. But -- 16 CHAIRPERSON LLOYD: I'm sure you can do that. 17 MS. BAILEY: I've experienced it, how do you say 18 it, nasaly. 19 (Laughter.) 20 MS. BAILEY: You know, just looking at the 21 emission inventories, I think these are really a daunting 22 problem. 23 CHAIRPERSON LLOYD: I think one of the things 24 you've got to recognize with us and a number of us went 25 out last year, including Didi, and not only experienced PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 84 1 the nasal impact, but also on our feet and elsewhere. 2 It's a tough issue. I mean, we have to recognize this. 3 It's not a, as Bob Fletcher was saying yesterday, it's not 4 some of our traditional sources, so trying to identify the 5 sources and how we mitigate them. So I think we're trying 6 to grapple with that, trying to work with the operators 7 there. 8 Last year, I was impressed when people were 9 actually very willing to work with us as long as they knew 10 that we were coming up with some procedures that made 11 sense, not trying to come up from the desk and telling 12 them that something would work and they know it doesn't 13 work. 14 So I became much more convinced that yes it is a 15 big issue, but also it's not an easy issue, because of 16 different points in the process and whatnot, and that's 17 why I was particularly interested in the technology. So 18 just bear with us a little bit in terms of trying to 19 understand and get the inventory correct, and then try to 20 find the solutions there. 21 So it's a big issue, but one that we're very 22 sensitive to that. 23 CHAIRPERSON LLOYD: Ms. D'Adamo. 24 BOARD MEMBER D'ADAMO: I'd just like to follow up 25 on something that you said earlier, Diane. And that is PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 85 1 you want to work closely with the District, ARB and the 2 stakeholders. And I just wanted to mention that the 3 Diane, Manuel Cunha, Brent Newell and others met in 4 Modesto a couple of weeks ago. There were probably about 5 15 environmental stakeholders and about 15 ag 6 stakeholders. 7 And although they will probably disagree more 8 times than they will agree, we did point out or locate a 9 couple areas of common ground; Carl Moyer technologies on 10 dairies, and then, as you say, the rail issue, the NAFTA 11 issue that Manuel raised earlier. So I'm really hoping 12 that we can continue the dialogue, because I think that 13 there is a tremendous potential for looking through some 14 of these solutions. 15 MS. BAILEY: I hope so too. And I just want to 16 add that, you know, I understand the complexity of this 17 issue that we are facing a very daunting task, but I hope 18 that we all can feel a sense of urgency in dealing with 19 these emissions. 20 CHAIRPERSON LLOYD: Dr. Loveridge. 21 BOARD MEMBER LOVERIDGE: Do you have NRDC's 22 comments written? 23 MS. BAILEY: I'm about to hand them in. 24 BOARD MEMBER LOVERIDGE: Okay. It's nice to have 25 them before hand. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 86 1 CHAIRPERSON LLOYD: Thank you. And again, Didi, 2 you reminded me, thank you for your outstanding leadership 3 on the ag issue. I wasn't aware at all that you were 4 trying to work on the environment. 5 Thanks. 6 Brent Newell and then Teresa De Anda. 7 Thanks for coming today, Brent, and giving your 8 comments on the insight in the EPA. It's fantastic. Good 9 thing it's not a waste of your time. 10 MR. NEWELL: I haven't seen that report. Perhaps 11 you can -- 12 CHAIRPERSON LLOYD: I haven't seen that. 13 MR. NEWELL: Well, good morning, Mr. Chair and 14 members of the Air Resources Board. I'm Brent Newell for 15 the Center on Race, Poverty and the Environment. And I'm 16 appearing here this morning on behalf of El Comite Para El 17 Bienestar de Earlimant, which is a group of Valley 18 residents in Tulare county, and also Association of 19 Irritated Residents, which is another local grassroots 20 organization in the southern Valley. 21 I regret that I could not attend the district 22 hearing. And I want to start off by thanking the Board 23 for its strong stance in adopting the regulations 24 implementing the Pavley -- those CO2 regulations are 25 critical. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 87 1 CHAIRPERSON LLOYD: The Greenhouse gas? 2 MR. NEWELL: Excuse me? 3 CHAIRPERSON LLOYD: Greenhouse gas. 4 MR. NEWELL: Greenhouse gas are critical. And I 5 respect your efforts. I'm also looking forward to the 6 implementation of the Mexican trucks rules to control 7 those trucks as Mr. Cunha talked about. 8 I have 2 points this morning to raise in 9 opposition to the plan. 10 One is in regard to Rule 4570, which is the 11 concentrated animal feeding operation commitment. Also, 12 pesticides remain exempt from control measures. So in 13 regard to CAFOs, there's really a massive invasion 14 happening in the Valley of dairy cows of large new 15 facilities. 16 For example, in the Wasco area there are more 17 than 100,000 cows worth of dairy plant or several miles 18 near Wasco in Kern County. Five out of the eight counties 19 in the Valley that have conditional use permit schemes 20 estimate more than 750,000 cows worth of new and expanded 21 dairies are in the permit process. 22 So there is a massive wave of new dairies and 23 dairy emissions that are coming in this valley as 24 reflected somewhat in the inventory in this plan. 25 CHAIRPERSON LLOYD: What percentage increase is PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 88 1 that, Brent? 2 MR. NEWELL: I have no idea. Perhaps somebody 3 from the district can step up and talk about the tons per 4 day. 5 I think one neat example is one that Dave Warner 6 gave to Senator Florez's agricultural -- or Air Quality 7 Committee. He testified in Wasco they talk about how 8 those 100,000 cows, even at a 50 percent control 9 efficiency would emit one and a half tons per day of VOC, 10 which was enough to wipe out the last couple of years' 11 worth of district VOC rules. 12 This is a significant amount of emissions. 13 There's a lot of disagreement about how large those 14 emissions are. The dairy industry likes to attack the 15 emission factor that the Air Resources Board uses and the 16 District uses. That's under refinementI. But I think all 17 parties agree that there's a lot of VOC pollution from 18 sources. 19 Specifically with regard to this commitment, it 20 references Section 40724.6 of the Health and Safety Code 21 being the basis of the rule. 40724.6 is Section 7 of 22 Senate Bill 700, which creates a permit program for 23 existing large confined animal facilities. 24 Now, you compare that with the Clean Air Act, 25 Section 182 of the Clean Air Act requires reasonably PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 89 1 available control technology for major stationary sources 2 of Volatile Organic Compounds. 3 What that means is is that any dairy facility 4 that's emitting or has a potential to emit more than 10 5 tons of VOC is supposed to have reasonably available 6 control technology required under this plan. The district 7 decided in California law to say that they're going to use 8 a different standard, which is best available retrofit 9 control technology. And they're going to apply it under 10 40724.6 to so-called large confined animal facilities. 11 Well, the disconnect here is that large confined 12 animal facility is a term of art in the statute that has 13 not been defined yet. The Air Resources Board is supposed 14 to define what a large confined animal facility is. 15 So the problem here is that the plan has a rule 16 commitment that's based on an undefined term, that uses a 17 different regulatory control, pollution control standard 18 than what is required in the Clean Air Act. 19 Today, you're suppose to approve this plan that's 20 compliant with the Clean Air Act under Health and Safety 21 Code section 41650(a). And I don't think you can do that, 22 because the commitment to reduce the largest chunk of VOC 23 reductions -- it's something like 12 or 15 tons per day -- 24 is based on an undefined size of facility with no 25 reference to whether their major stationary sources in PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 90 1 tons per day of VOC is an extreme nonattainment area or 2 not. 3 You luckily have the authority under the Health 4 and Safety Code to amend the plan. 41652 in the Health 5 and Safety Code gives you authority during this review 6 process to fix the plan. 7 And we'd like to ask you to fix the plan so that 8 it's consistent with the Clean Air Act and California law. 9 I think it's critical that whatever plan you adopt today 10 and send up to EPA is going to meet the Clean Air Act. 11 That's what it's supposed to do. And right now it's just 12 saying that large confined animal facilities, whatever 13 that means, are going to adopt a different control 14 technology. 15 My second point goes to pesticides. And I have a 16 couple of visuals to help me out here. I want to do a 17 little history in regards to pesticide controls. 18 (Thereupon an overhead presentation was 19 Presented as follows.) 20 MR. NEWELL: First of all, in 1994 the ozone 21 State Implementation Plan contains a commitment that says 22 the pesticides in 5 air basins are going to be cut by 20 23 percent between 1990 and 2005. You are being sued because 24 of that commitment, and the fact that the regulations 25 contained in that commitment have not been adopted. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 91 1 In 2002, something called the California Clean 2 Air Plan was adopted. It was quickly rescinded, but 3 within the California Clean Air Plan, were several -- 4 CHAIRPERSON LLOYD: What is the California -- 5 MR. NEWELL: It was proposed, and then not 6 adopted, right? 7 CHAIRPERSON LLOYD: I need to look to Catherine. 8 EXECUTIVE OFFICER WITHERSPOON: I'm sorry. We 9 were talking about the WRAP issue, but repeat the 10 question. 11 CHAIRPERSON LLOYD: The California Clean Air Plan 12 I don't think ever get to the Board. 13 EXECUTIVE OFFICER WITHERSPOON: No, we brought 14 you, instead, the 2003 comprehensive strategy for sources 15 under the Air Resources Board's jurisdiction. 16 MR. NEWELL: The difference between the 2 is that 17 the California Clean Air Plan in 2002 contained mandatory 18 pesticide Volatile Organic Compound controls like no spray 19 days, product reformulation, stuff like that. 20 Mark Grossia wrote a very interesting article 21 about how that plan was withdrawn in their award winning 22 Last Gasp special section. 23 The 2003 Statewide Strategy says that what's 24 going to happen is well, we're just going to keep 25 implementing this 1994 plan where we're going to have PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 92 1 voluntarily controls. This is the commitment that you're 2 being sued over. You're going to continue this 10-year 3 old voluntary program to cut pesticide control. 4 Recently, in my first visual here, is this DPR 5 document, which was posted on their web site for about 1 6 week. And it says that the target for the San Joaquin 7 Valley is a 20 percent 2005 target. And it also says that 8 what they want to do in terms of this plan that you're 9 adopting today is cut pesticides by 30 percent -- an 10 additional 30 percent from 1999 levels. 11 This plan went to the ARB Agricultural Advisory 12 Committee and was withdrawn the same day. It was taken 13 off the Department of Pesticide Regulation's web site that 14 very same day. 15 And now, the extreme plan says we're just going 16 to continue the 1994 thing with no change. Why am I 17 talking about all this history? 18 I'd like to put up the second visual. 19 --o0o-- 20 MR. NEWELL: This is the most recent graph 21 showing pesticide levels in the San Joaquin Valley Air 22 Basin. Not really pesticide levels, but VOC emissions 23 from pesticide use. And the arrow on the left is just 24 under 25 tons per day. That's the level that -- the 25 baseline level, 1990. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 93 1 The arrow on the right is the most recent number, 2 which is from 2002. And it shows that it's just slightly 3 under where we started 12 years ago. And it's well above 4 the so-called 1999 goal, which I disagree with, because 5 really the commitment is a 2005 20 percent cut. 6 But the reason I'm showing you this is that to 7 make the point that voluntary pesticide controls don't 8 work. You can see the massive spike. And we are now 9 basically where we started 12 years ago. 10 This is failing. The voluntary control program 11 is failing. 12 --o0o-- 13 MR. NEWELL: My third visual is a document 14 submitted to Judge Carlton recently. Judge Carlton is the 15 judge that's presiding over the case El Comite versus 16 Helliker. And this document lays out the position -- your 17 position as articulated by your lawyer that there is no 18 pesticide commitment in the 1994 State Implementation 19 Plan. 20 Your staff report for this plan that you've 21 released says that there is a commitment in the SIP, and 22 that that's the strategy that we're using. The 2003 23 Statewide Strategy says that there's a commitment in the 24 SIP to control pesticides. The plan says that there's a 25 pesticide commitment in the SIP. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 94 1 Now, what I'd like to know is whether your lawyer 2 was lying to the judge or whether those 3 documents that I 3 just talked about are lying to the public? What is going 4 on? Is there a commitment to cut pesticides in the State 5 Implementation Plan, or is there no commitment to cut 6 pesticides in the State Implementation Plan? 7 CHAIRPERSON LLOYD: That's your testimony? 8 MR. NEWELL: No. I wanted to say what we'd like 9 out of this process. I think it's -- 10 CHAIRPERSON LLOYD: We'll come back to our staff. 11 MR. NEWELL: I'll let them think about it for a 12 little while. 13 What El Comite would like is are real VOC control 14 measures that cut one of the largest sources of VOC 15 emissions in this Valley. Pesticides represent one of the 16 largest sources, and they are unregulated. Voluntary 17 control measures really just -- they're really just a 18 euphemism for exemption. There's no requirement to cut 19 the significant sources of smog-forming pollution at all. 20 We are suing you, and I'm sorry that it comes to 21 that, but we had to go to court to get the regulations 22 adopted to control this pollution. All sources of 23 pollution should be controlled, not just some, not part, 24 but all significant sources of smog-forming pollution need 25 to be controlled. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 95 1 It was mentioned that there was a 10-ton per day 2 shortfall in this plan. Okay, if there were real 3 pesticide control regulations, I think you can either get 4 that 10-ton per day shortfall or come darn close. 5 That's all I have to say. Are there are any 6 questions, Mr. Chairman? 7 CHAIRPERSON LLOYD: Well, I'd like staff to 8 respond to some of the legal issues that you've raised. 9 GENERAL COUNSEL JOHNSTON: Well, I think this -- 10 is Diane Johnston, General Counsel. And I will ask George 11 Poppic, our Senior Staff Counsel, to address the issue 12 more specifically. 13 But basically the dispute in this litigation 14 involves what the commitments actually were that the ARB 15 committed to in the earlier SIP. And Mr. Newell is 16 relying on a document that was published in the Federal 17 Register that was not the final commitment, and is making 18 that document represent the final commitment of the ARB 19 and the Department of Pesticide Regulation, where is that 20 document that was published in the Federal Register is not 21 the final commitment. 22 And so that's basically what the litigation 23 involves is, you know, whether that was the final 24 commitment or the final federal adopted SIP plan was in 25 fact what we committed to, and the Department of Pesticide PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 96 1 Regulation. 2 EXECUTIVE OFFICER WITHERSPOON: Before we get 3 really deep into the legal technicalities though, because 4 it does turn on legal technicalities in this lawsuit on 5 pesticides, the broader sort of understanding of what's 6 going on in pesticide regulation in California is that DPR 7 is the sole agency authorized to regulate pesticides and 8 their pesticidal use. Neither the Air Resources Board nor 9 the Air District can propose regulations or mandate 10 regulations. So the request that Brent ended upon is not 11 really something that this Air Resources Board can do. 12 What happened instead, procedurally is that we 13 worked with the Department of Pesticide Regulation to 14 understand the emission sources creating ozone 15 nonattainment in the Valley, and the extent to which 16 pesticide measures could be employed to help us meet our 17 targets. 18 In prior plans DPR has been heavily reliant on 19 its integrated pest management strategies, which are a 20 variety of techniques to reduce pesticide applications 21 through the use of counteracting bugs, you know, that work 22 to protect plants, disease resistant crops, different 23 methods of irrigation and of sewing and of reaping and the 24 rest of it to reduce overall pesticide loading. 25 And they believed at the time we did the '94 SIP PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 97 1 that the integrated pest management strategies were going 2 to be sufficient to reach the target that was set out for 3 attainment in that plan of a 20 percent VOC reduction. 4 And they now think that they're not sufficient. 5 And DPR is exploring a mandatory measure to achieve the 6 additional tons needed. However, none of that is related 7 to the litigation which turns on at a specific moment in 8 time did California or not satisfy reasonable progress 9 requirements in federal law exactly where were we on the 10 emission inventory continuum. So that's what the lawsuit 11 is about. 12 Looking forward in the document that Mr. Newell 13 referred to that was discussed at the Ag Advisory 14 Committee. When we first started on the 2010 plan, DPR 15 sort of took as a framing idea that perhaps they should 16 try to achieve a proportional reduction in pesticides. 17 And they wanted to start the discussion from them. 18 Nothing in the law requires that they do that. We had not 19 suggested that target to them. DPR thought it would be 20 fair and equitable to simply -- let's presume that that's 21 our obligation, and then let's talk about can we or can we 22 not meet that. 23 They had not committed to that level of 24 reduction. They had not done any analysis yet on whether 25 it was feasible. And what happened when we sat down with PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 98 1 the agricultural industry is they were alarmed. And the 2 fact that there's been so much litigation in this arena 3 alarmed them even more. So to some extent the litigation 4 has been counter productive and has had a dampening effect 5 on dialogue and analysis. 6 And so they said you've got to take that off of 7 your web site immediately. If you start with that as an 8 assumption, that will be litigated too, and you have 9 nothing to support it. DPR admitted, you're right, we 10 don't. We haven't done any analysis yet. It was a 11 conjecture that wouldn't it be nice if we hit that target. 12 So DPR willingly agreed to remove the target even 13 as the starting point. And since then build from the 14 analysis up to what was within the realm of possibility 15 and feasibility, both considering the mandatory rule 16 they're working on now, over the past plan and then 17 looking forward what's going on in the pesticide world 18 that could be applied to achieve greater emission 19 reductions. 20 Since none of that was ripe enough to include in 21 this plan update, we sort of left the existing pesticide 22 measure as the transitional one that carried forward. And 23 again this work will drop into the '07 data hour ozone 24 SIP, which will be fundamental and derive the lion's share 25 of the control strategies for this basin. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 99 1 So that's the context on pesticides. 2 BOARD MEMBER D'ADAMO: Before moving on to the 3 legal issues, I want to just add that I was at that 4 meeting as well, and my recollection is exactly what Ms. 5 Witherspoon related. But then in addition, there were 6 some inventory issues that had not yet been worked out 7 because that inventory needs quite a lot of work. So it 8 is hard to come up with a target not knowing whether or 9 not it was feasible, but also not even knowing exactly 10 what the inventory was. 11 EXECUTIVE OFFICER WITHERSPOON: The crucial part 12 of the inventory question is that most of the emissions 13 are coming from fumigants in the pesticide category. And 14 EPA has been petitioned to remove certain fumigants from 15 the VOC category because they are not reactive. 16 However, they are toxic and damaging throughout 17 the upper atmosphere. So it wasn't clear whether EPA was 18 going to be able to do that one action on ozone without 19 getting tangled up in other issues about Methyl Bromide in 20 particular. 21 So there were a lot of issues that needed to be 22 sorted out, and whether they needed to be individual books 23 on pesticide, one for fumigants and one for more 24 traditional VOCs and how that might affect legal 25 commitments and control targets. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 100 1 GENERAL COUNSEL JOHNSTON: If I may suggest to 2 the Board, if we're going to -- because of the litigation 3 if we're going to discuss this any further, I suggest that 4 we do it in closed session for the Board. 5 DEPUTY EXECUTIVE OFFICER TERRY: Diane, can I 6 just make one simple clarification that Catherine 7 referenced the 20 percent reduction commitment. And 8 actually it's 12 percent in the Valley for 1990 and the 20 9 percent applied only to the later, I think, 2005 going 10 forward. 11 GENERAL COUNSEL JOHNSTON: Okay. 12 EXECUTIVE OFFICER WITHERSPOON: And perhaps we 13 can respond to the RACT issue, which is not in litigation 14 at the moment. And on RACT the representation was made 15 that the federal law requires more controls for dairies 16 for all dairies without a threshold, because RACT is 17 required for all nonattainment sources. But EPA has never 18 established a RACT determination for dairies as an 19 emission source. 20 On the contrary, EPA has established a Safe 21 Harbor for dairies from enforcement under other Clean Air 22 Acts Statutes, because they wish to conduct fundamental 23 research on the nature of dairy emissions before they move 24 into either enforcement actions or regulatory actions. 25 So I think the district was correct in siting PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 101 1 State law as the basis for coming up with dairy controls. 2 And also the 15-ton per day target that they put in the 3 Act is not a limit on going beyond that, if that's in fact 4 what technology allows us to do, which is something we 5 evaluated right now. 6 And that speaks Diane Bailey's testimony too, 7 that somehow we're putting a ceiling on what's feasible 8 and she asked the Board to raise the target. But it's the 9 district's best estimate of what at least they'll be able 10 to accomplish and that they're willing to have a federal 11 government be able to enforce against them. And so we're 12 now just beginning this technology assessment. 13 CHAIRPERSON LLOYD: Thank you. 14 MR. NEWELL: I just want to go on record in 15 saying that I disagree with the legal characterizations 16 made by staff. And I want to also raise that the Safe 17 Harbor Agreement that Ms. Witherspoon just talked about is 18 only a proposal. It's not a finalized EPA deal. It's 19 called the Animal Feeding Operation Consent Agreement and 20 Final Order. And it's really just an internal document at 21 this point. It hasn't even been proposed in the Federal 22 Register. 23 CHAIRPERSON LLOYD: What about the issue, and 24 maybe I can -- I don't know whether this gets into the 25 violation of the issue raised earlier, that since we have PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 102 1 defined what a CAFOs is, that it's not consistent with the 2 Clean Air Act, is that -- did we address that earlier and 3 not talk about that? 4 GENERAL COUNSEL JOHNSTON: We can address that 5 briefly. The mandates in SB 700 for CAFOs require us to 6 coordinate the definitions between federal and State law. 7 And those will be -- that will be done in developing the 8 definition of CAFO. So I don't think that there's any 9 legal issue in going forward with a plan now, because 10 those will be forward moving. 11 EXECUTIVE OFFICER WITHERSPOON: And the CAFO 12 rulemaking will be before you next July I believe, July 13 12th. 14 CHAIRPERSON LLOYD: Thank you. 15 Now, we have Teresa De Anda in Bakersfield. 16 MS. De ANDA: Good morning to all of you over 17 there. I wish I could have driven over there, but it was 18 a little bit foggy, and I was kind of scared to drive and 19 I had to get my kids off to school at 8:30. I have a lot 20 of kids. I have a lot of grand kids. And since Brent 21 talked about all of the legal aspects and all those big 22 words and all the regulations and stuff that were met or 23 not met -- it's kind of weird, because I don't know where 24 to look at. 25 I'll just talk about health. When I'm filmed or PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 103 1 something they say look here, so I know where to look, but 2 here I don't know where to look, but look cross-eyed. 3 (Laughter.) 4 CHAIRPERSON LLOYD: You're coming across fine. 5 MS. De ANDA: Okay. I think I'll talk about my 6 grandson who's very healthy. And he's playing tackle 7 football right now. He's 8 years old. And I didn't want 8 him to play. I said, I don't want him to play. I told my 9 daughter and my son-in-law don't let him play, because I 10 don't want him to get asthma, because I know when they're 11 out there playing that there's high ozone, high PM, that 12 he can get asthma just by being out there and exerting all 13 of that energy. 14 And I love that he exercises, and I love that 15 he's healthy, but I want him to stay healthy. And with 16 the air being the way it is in the Valley, it's kind of -- 17 it's very scary for me as grandma to think that my healthy 18 son -- my health grandson is going to get asthma just for 19 playing football. 20 It wasn't like that before. I think we could 21 play sports more easily before when I was growing up. But 22 now it's different. And the air has gotten considerably 23 worse. 24 And I'll also talk about my 2 other grandkids. I 25 have 5 grand kids. I just had one last Saturday. And PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 104 1 they name her Emily Teresa. And I like that because I'm 2 Teresa. 3 (Laughter.) 4 MS. De ANDA: But she was born healthy. She 5 wasn't premature. But my other 2 grand kids from my son, 6 they were born premature. That means that their lungs 7 weren't developed fully, so they're very, very vulnerable 8 to asthma. 9 Angel is very -- he's 4. He's very active, very 10 running around and stuff. And I worry about him. I look 11 at him and I say, my God, when he does get asthma, because 12 it's inevitable he's going to get asthma because his lungs 13 weren't developed enough. And I said he's not going to be 14 able to run around like that anymore or he'll have to have 15 the little inhaler all the time, or the nebulizer, like so 16 many kids that I no have. 17 And then my little -- my grandson from my son, 18 Casey Jr., he's going to get asthma, because his lungs are 19 premature because he was premature. So I'm just looking 20 at you and telling you to -- first, I better say that I'm 21 in opposition to this, because it doesn't say anything 22 about pesticides. And I am the Director of El Comite Para 23 El Bienestar de Earlimant. I came here today presenting 24 Californians for Pesticide Reform. 25 The pesticides aren't even in that plan. And PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 105 1 that's like trying to change the tires on a car when the 2 motor is broken. If pesticides contribute to so much of 3 the ozone by the VOC's that they put out -- and I'm not 4 very educated about all that stuff, but I do know that 5 pesticides do let off a lot of VOC's. Certain pesticides, 6 not all pesticides. And a lot of pesticides have a lot of 7 toxic stuff in them. 8 But the VOCs aren't being addressed here, the 9 pesticides let off, and that's why I'm in opposition to 10 the plan. But I really enjoy working with everybody here. 11 And I just -- I hate to be in opposition to anything. I'm 12 not a troublemaker. I'm not. 13 (Laughter.) 14 MS. De ANDA: So I guess that's all. 15 CHAIRPERSON LLOYD: Thank you very much for 16 taking the time. Believe me, we're on your side. We want 17 to get to cleaner, the faster the better. And if you look 18 from the date of it, staff presented earlier you can see 19 this last year was one of the cleanest times. Recognize 20 that meteorology plays a big role and we need to continue 21 to do our part. 22 Thank you very much. 23 MS. De ANDA: Thank you. 24 CHAIRPERSON LLOYD: John Beyer and Sean Edgar. 25 Those are the last 2 witnesses. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 106 1 MR. BEYER: Good Morning, Dr. Lloyd and Board 2 Members. My name is John Beyer. I'm with the U.S. 3 Department of Agriculture, Natural Resources Conservation 4 Service. 5 I'd like to talk about a program a little bit 6 different. This is not a nebulous program. This is not a 7 program where you have computer modeling or anything. 8 This is actual on-the-ground practices that are being 9 installed by agricultural growers to reduce particulate 10 matter, NOx and VOCs. 11 And through this handout on here you'll have an 12 indication of how successful this program is. It's a 13 voluntary program. And that's what we want to support 14 under this plan is the options of voluntary application by 15 growers through incentives, makes it a lot more easier for 16 the grower to adopt these practices. 17 You see in the handout that in the last 4 or 5 18 years we've -- our agency has put almost $14 million 19 towards application of these practices on the ground. 20 We've had 3,000 growers sign up to participate in the 21 program. Although because of funding limitations, only 22 about 2,000 have been able to be funded. 23 What am I talking about on these types of 24 programs? This is dust control on roads. Over the years 25 we are averaging about 300 miles of roads that dust PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 107 1 control has been applied to. This amounts to roughly 2 1,200 to 1,300 miles currently. That's every year that 3 growers are putting dust control products. 4 Now, this is a cost-sharing program with the 5 grower. So the grower can receive up to 50 percent of the 6 cost on there. But we're talking about major reductions 7 in NOx, VOCs and PM. 8 Another part of the program deals with reduction 9 in burning, and that's a major reduction in NOx and VOCs. 10 Through the program on here, we have roughly 80,000 -- 11 almost 80,000 acres that have been reduced or have changed 12 their practices from burning in the past now to a measure 13 of chipping or non-tailings that reduces the burning 14 aspects. 15 Roughly 3,000 acres have been taken out. In 16 other words, the orchard has been pushed out on their and 17 we've encouraged chipping of these products rather than 18 the burning of those. So, you know, and in conjunction 19 with those any practices that we do on there have been 20 researched. We have an estimate of the emission 21 reductions with the application of that practice. 22 So you'll see on the chart the actual numbers of 23 applications of acres or miles or roads with the NOx and 24 VOC reductions. 25 You'll also see an increase of interest by the PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 108 1 growers. Last year, as another example, conservation 2 tillage, which is reducing the number of passes across the 3 field. And as you can expect, when we reduce the number 4 of passes across a field, you reduce the particulate 5 matter that's being emitted, also the NOx and VOCs that 6 are coming from the internal combustion engines that have 7 been used. 8 So you're talking almost a three fold increase by 9 grower's interest in participating in the program. Last 10 year we had 21,000 acres that were included. 11 The last item that I'd like to share is like on 12 the diesel engine replacement, we've worked in concert 13 with the San Joaquin Air District on there. They have, 14 over the last 4 years, replaced over 3,000 engines. We've 15 just started in the last year or 2 to work in concert with 16 them. And we have roughly 300 engines that have been 17 replaced on there. 18 These are stationary engines used for irrigation 19 pumping. And we'll expand our program into mobile engines 20 used for irrigation pumping this coming year. 21 So what I'm trying to say is agricultural growers 22 have an interest in reducing emissions and improving the 23 air quality of the Valley. One way of doing this is 24 through an incentive program, voluntary that the growers 25 have by indications on here, are very interested in and PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 109 1 have availed themselves of this cost-sharing program to 2 enhance the air quality through the Valley. 3 Thank you. 4 CHAIRPERSON LLOYD: Thank you very much. 5 Any questions? 6 Last speaker is Sean Edgar. 7 MR. EDGAR: Good morning, Mr. Chairman and Board 8 Members, Sean Edgar on behalf of Clean Fleets Coalition. 9 Good to see you in Fresno this morning. 10 Unfortunately, I'm not qualified to speak on 11 happy or unhappy cows or pesticides or infer who might or 12 might not be telling the truth on a lot. But I'm him to 13 speak specifically in support of this plan and the hard 14 work that this district has done over many, many months 15 and echo Mr. Crow's comments and ask that this Board 16 approve that plan. 17 I agree wholeheartedly with Ms. Witherspoon's 18 assessment that litigation is counter-productive in many 19 respects, and just wanted to provide you our support for 20 the plan as well as a brief update on the refuse rule that 21 was implemented on July 20th. 22 And this plan, I believe on the mobile source 23 side, goes pretty deep, and frankly from the industry 24 perspective our folks operating mobile sources in the 25 Valley we'd like to go a little bit deeper on it. But I'd PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 110 1 guess to say in the vernacular here in the Valley we're 2 sucking it up and we're moving forward with regard to 3 implementing your landmark retrofit rule for garbage 4 trucks. 5 And frankly, if I had a little bit more kind of, 6 you know, down discussions this morning, I was going to 7 ask Manuel for some of his wine, and I'd like to just cut 8 out early and relax a little bit. But unfortunately, 9 guess what, I get to go further down the valley and speak 10 with a local county, Tulare county in particular about 11 implementing a transfer station project, which has 12 promised to eliminate hundreds of thousands of vehicle 13 miles traveled hopefully. And I won't have wine and I'll 14 be able to further that project. 15 But very briefly, our company would like to dig a 16 little bit deeper on mobile sources. A quick update for 17 you, working with air district staff here, we've been 18 working more creative, beyond the -- what is the -- beyond 19 the moving the box or outside the box, the blowing up the 20 box I believe in the vernacular. So we're working on 21 trying to blow up the box with some DMV surcharge money, 22 some of the SB 709 money. The Board has got some creative 23 ideas here on how that money could be directed more toward 24 mobile sources. So we're actively engaged in that. 25 With Operation Clean Air, Chairman Lloyd had PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 111 1 asked the question what they're doing. We've been working 2 very closely on creating a federal legislative strategy to 3 bring multiples of tens of millions of dollars here to the 4 central Valley to try and assist mobile sources in rolling 5 out emissions reductions faster. 6 We're looking forward to participating more 7 deeply in the LERP project, the Large Emission Reduction 8 Program, that a lot of those items were left over. You 9 know, the portion of that culminated in AB 923 Firebaugh 10 this year. But we hope to be able to dig a little bit 11 deeper there. 12 The CPR Commission was here in Fresno on 13 September 17th. I went up told them I said, "We'll, gee, 14 on the one hand it might be convenient to say Air 15 Resources Board go away, because we happen to have a big 16 obligation put on our shoulders." 17 In reality, we need an advisory body, we need 18 some expertise, we need a body to help us do the best in 19 public health that we can to further making our refuse 20 rule happen. And we'll see how that evolves in the 21 Legislature the early part of next year. 22 And finally on the technology side, I'm working 23 with several dozen fleet managers every day. And really I 24 think the exercise there is one of packing a lunch, 25 understanding what the technology limitations are. We're PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 112 1 putting temperature probes on trucks. We're figuring out 2 how to make it work. So going back to, yes, litigation is 3 counter-productive, we're trying to direct that energy 4 towards actually getting products on the road and on our 5 trucks that will be able to clean the air. And we've been 6 trying to encourage our members to fully participate in 7 chip reflash and we hope to have an update from our 8 company over the next couple of weeks on that. 9 As a last item, I would just briefly touch on, we 10 will be submitting comments by November 15th on the 11 federal waiver issue that will -- the executive officer 12 has asked for comments. To a large degree, we feel it has 13 huge implications and would be a major policy shift for 14 this Board based on your leadership on fuel neutrality and 15 letting the marketplace decide what the best technology 16 is. 17 We're right now in the middle of, I can say with 18 some confidence, that the 12,000 or so garbage trucks in 19 this State that your staff pointed out, I think there may 20 be a few more than that. But if we go with your staff's 21 12,000 number, I can say with some confidence that more 22 than 3,000 of those trucks are being dealt with right now 23 and will likely have devices on them sometime in the next 24 several months. 25 So we're really jump-starting this thing. We're PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 113 1 moving down a path very rapidly to put the breaks or put a 2 side-door or a trap-door. And say we'll gee, it's not 3 this technology it should be this other technology, which 4 would, I think, be a disservice to the folks who are 5 really trying to make diesel reduction happen as quickly 6 as possible. 7 So with that, thank you very much for moving this 8 plan forward. We'll continue to work with you and work 9 with the district. And thanks much for your time this 10 morning. 11 CHAIRPERSON LLOYD: Thank you very much. 12 Any questions? 13 Thank you. 14 Ms. Witherspoon any additional comments? 15 EXECUTIVE OFFICER WITHERSPOON: Nothing, Chairman 16 Lloyd. 17 CHAIRPERSON LLOYD: Thank you. 18 Since this is not a regulatory item, it's not 19 necessary to officially close the record. However, we do 20 have a resolution before us. So you see the motion, if 21 there's any further discussion on this item? 22 Ms. Patrick. 23 BOARD MEMBER PATRICK: Mr. Chairman, I would make 24 a motion to approve the resolution that is before us with 25 the comment that, you know, a lot of peep worked very, PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 114 1 very hard on this plan, and we believe that this is going 2 to bring us into attainment. And with that, we all have a 3 tough job ahead of us making sure that we do have it. But 4 I believe that this is an excellent plan. And everything 5 that I've been able to gather in terms of information is 6 that this is the plan that's going to take us where we 7 need to go. 8 CHAIRPERSON LLOYD: Second? 9 BOARD MEMBER D'ADAMO: Second. 10 CHAIRPERSON LLOYD: Any discussion? 11 I would like to ask maybe -- a couple of quick 12 comments came up today and maybe Didi could -- the 13 advisory committee would maybe appropriate coming to you, 14 such as the pesticides keeping track of that. I know that 15 we're entering into the research program to look at some 16 of the reactivity of pesticides, which I think will help 17 the database. And clearly the whole issue of CAFOs and 18 how that's complying is going to be a big one. But I know 19 that staff is on top of those. 20 BOARD MEMBER D'ADAMO: Mr. Chairman, I'd be happy 21 to do that. And I would like to echo Supervisor Patrick's 22 comments that everyone worked really hard on this. And 23 for those that have concerns, I'm very confident that 24 working through the process we're going to get those 25 concerns addressed, especially with the CAFO definition PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 115 1 coming up and additional rule-making in the district. 2 And then on the pesticide issue, I believe 3 working closely with the DPR is this solution on that. 4 CHAIRPERSON LLOYD: And do -- 5 BOARD MEMBER D'ADAMO: We're committed to helping 6 out. And also continuing the dialogue that we started a 7 couple of weeks ago with the ag an environmental 8 stakeholder groups put together. 9 CHAIRPERSON LLOYD: Great. That's what I 10 thought. 11 Supervisor DeSaulnier. 12 BOARD MEMBER DeSAULNIER: I just wanted to thank 13 Bob Crow, Barbara and Didi in particular. A few years 14 ago, I wouldn't have looked forward representing the Bay 15 Area coming out here for one of these. Although, I did 16 try to get 2 bus loads of people to come. 17 (Laughter.) 18 BOARD MEMBER DeSAULNIER: For those of who 19 remember that hearing in San Francisco. But I really I 20 it's an indication of how far we've come thanks to your 21 commitment and I think also the Bay Area, the transport 22 has become less of an issue. Although it's always going 23 to be an issue. I think maybe we can have the 24 discussions, particularly around the Port of Oakland and 25 those intermodal trips. They're so important as we PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 116 1 continue to have dialogue between the districts in the Bay 2 Area. But smog check wasn't that hard after all. 3 CHAIRPERSON LLOYD: I think again you highlight 4 some of the dynamic issues here. The issue are the goods 5 movement, expansion of false CAFOs. They weren't so high 6 on the priorities 10 years ago. We have to be vigilant of 7 especially for the challenges ahead. 8 So with that, all in favor say aye? 9 (Ayes.) 10 CHAIRPERSON LLOYD: Anybody against? 11 BOARD MEMBER LOVERIDGE: Abstain. 12 CHAIRPERSON LLOYD: Abstention? 13 Thank you. With that, I need take a quick break 14 for our court reporter. 15 What I'd like to do with my colleagues and with 16 staff is to get to the ledge item before lunch, which 17 would be about 20 minutes or so. Lunch is here, but kept 18 warm. Maybe if we can -- would 5 minutes be okay? 19 Five-minutes break while we turn staff over and go on to 20 the ledge item after that. 21 Thank you very much, staff. 22 Thank you. 23 (Thereupon a recess was taken.) 24 CHAIRPERSON LLOYD: The second item on today's 25 agenda is 04-9-2, review of air quality legislation for PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 117 1 2004. The legislature just finished the second year of a 2 2-year session in August, and the Governor has taken 3 action on all of the bills that reached his desk. 4 Therefore, I have asked Rob Oglesby, our Leg Director, to 5 give us an overview of the legislative year, including the 6 major bills that were signed into law, special hearings 7 related to air quality and major issues that he expects to 8 carry over into the next legislation session. 9 And before I let Rob speak, I would like to 10 congratulate him and his staff on another outstanding year 11 of dedication, right up until the last early hours of that 12 morning. You did an outstanding job for the Board. So 13 I'd like to thank you and your staff for a great job. 14 LEGISLATIVE DIRECTOR OGLESBY: Thank you, Mr. 15 Chairman. 16 (Thereupon an overhead presentation was 17 Presented as follows.) 18 LEGISLATIVE DIRECTOR OGLESBY: Thank you for your 19 kind words, Mr. Chairman and members of the Board, and Ms. 20 Witherspoon. Thank you for the opportunity to provide a 21 brief review of significant air quality legislation, and 22 particularly for the new members of the Board, I will 23 provide a brief primer on the ARB's Office of Legislative 24 Affairs. I'll begin with introductions 25 --o0o-- PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 118 1 LEGISLATIVE DIRECTOR OGLESBY: The Legislative 2 Office staff includes Sheila Marsee, Jon Costantino, Lisa 3 Macumber, Bruce Oulrey, Elizabeth Miller and executive 4 assistant Ollie Awolowo. This photo includes our summer 5 intern from Berkeley Lizzie Betuzi. All tolled, the 6 legislative office brings more than 125 years of 7 legislative and air quality experience to the Board. 8 --o0o-- 9 CHAIRPERSON LLOYD: So young. 10 (Laughter.) 11 CHAIRPERSON LLOYD: Yet so wise. 12 (Laughter.) 13 LEGISLATIVE DIRECTOR OGLESBY: It was awesome 14 when we totaled the numbers up. Since we are kind of a 15 small staff. The Legislative Office serves as the 16 Administration's principal resource for analysis and 17 advice on the merits of air quality legislation. Of 18 course the legislative office is also available to you as 19 a resource on air quality legislation. 20 Bills relating to air quality are identified and 21 analyzed with support and input from ARB's excellent 22 technical staff and executive officer, and then submitted 23 through the change of command to the Governor's office. 24 The ensure that the Administration speaks with 25 one clear and consistent voice, all positions on PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 119 1 legislation are the Governor's position, and only 2 positions approved by the Governor's office are made 3 public. 4 New board members should also be aware that the 5 Legislative Office is available to help guide you through 6 the appointee confirmation process in the State Senate. 7 Now on to the legislative session. 8 --o0o-- 9 LEGISLATIVE DIRECTOR OGLESBY: The 2003/2004 10 legislation session recessed on August 28th. And the 11 deadline for the Governor to sign or veto bills was 12 midnight on September 30th. Overall, 2,200 bills were 13 introduced and. The Governor signed 600 and vetoed 133, 14 which set a record for the number of vetoed bills. In 15 doing so, the Governor made extensive use of signing and 16 veto messages to define and communicate his position on 17 legislative issues. 18 This year about 143 bills related to air quality 19 some good, some bad. Of these air quality bills, 43 were 20 signed into law, and the rest failed passage of were 21 vetoed. 22 Now I'll highlight specific bills and legislative 23 issues, beginning with the budget and related fiscal 24 issues. 25 --o0o-- PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 120 1 LEGISLATIVE DIRECTOR OGLESBY: Reflecting the 2 Governor's priority on improving California air quality, 3 ARB's operating budget did quite well. There was some 4 bill tightening. But on the whole, ARB essentially held 5 even at about 130 million, which is note-worthy at a time 6 of deep cuts in the State budget. The ARB budget was 7 revised, now only relying on trace amounts of the General 8 Fund, less than 2 percent. 9 Next month, you will be asked to consider 10 revising fees on pollution sources to replace about 2.6 11 million general fund revenues that have historically 12 supported programs related to these pollution sources. 13 --o0o-- 14 LEGISLATIVE DIRECTOR OGLESBY: Turning to the 15 funding of emission reduction reducing incentive programs. 16 In July the Governor approved the first permanent funding 17 for the popular Carl Moyer program as part of the budget 18 package. This historic action raises $61 million 19 annually. The Carl Moyer program began in 1998, and has 20 distributed over 154 million to reduce primarily NOx 21 emissions from the State's highest emitting diesel 22 engines. 23 But until this year's budget, no additional funds 24 were available for future projects. Budget trailer bill 25 SB 1107 provides an ongoing funding sources for the Carl PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 121 1 Moyer program using a mechanism that reduces smog-forming 2 emissions and at the same save consumer's money. 3 How was this accomplished? By creating a 4 smog-check exemption for cars that rarely fail a smog 5 check and collecting a modest fee to more than make up to 6 the for-gone emission reductions through the Carl Moyer 7 program. 8 Specifically, the smog-check exemption period for 9 new motor vehicles will be increased from 4 years to 6 10 years. And the exemption fee will be increased from $6 to 11 $12 annually. In addition, vehicles up to 4 years old 12 will be exempt from a smog inspection upon change of 13 ownership. 14 Together these changes will cut consumer 15 smog-check inspection costs by $48.5 million annually, 16 raise an additional $6.8 million per year for low-income 17 vehicle repair and assistance, and, as I mentioned, 18 provide a dedicated source of $61 million here to the Carl 19 Moyer program. 20 --o0o-- 21 LEGISLATIVE DIRECTOR OGLESBY: Testing newer cars 22 5 and 6 years old generates only 3 tons per day 23 smog-forming emission reductions at a cost effectiveness 24 of about $40,000 per ton, very cost ineffective. Under 25 this bill, the augmentation to the Carl Moyer program will PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 122 1 deliver more than 30 tons per day in net emission 2 reductions, at a cost of effectiveness of only $5,000 per 3 ton. 4 --o0o-- 5 LEGISLATIVE DIRECTOR OGLESBY: Building on this 6 success, the Governor signed legislation in September that 7 provides about $80 million annually for 10 years to some 8 of the state's most successful air quality programs. This 9 is a significant accomplishment. And you will be asked to 10 help implement this landmark legislation soon. So I'll 11 take a few moments to review the major features of this 12 bill for you now. 13 Early legislative efforts to develop a stable and 14 substantial funding source for pollution reduction 15 incentive programs faltered. CalEPA Secretary Tamminen 16 personally stepped in to become the catalyst for a 17 successful proposal that reflects a bipartisan consensus 18 between stakeholders from the environment, local air 19 districts, agriculture and industry. 20 The proposal became embodied in Assemblymember 21 Firebaugh's AB 923, and creates 2 significant funding 22 streams, one at the local level and one at the State 23 level. 24 --o0o-- 25 LEGISLATIVE DIRECTOR OGLESBY: The funding PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 123 1 Components provide a $2 increase in local motor vehicle 2 registration fees and a State fee a .75 cents per tire on 3 the sale of new tires. I'll come back to these mechanisms 4 in a minute. 5 --o0o-- 6 LEGISLATIVE DIRECTOR OGLESBY: The existing Carl 7 Moyer program targets NOx from diesel engines and adds 8 particulate reductions as a favorable consideration for 9 determining eligible projects. AB 923 amends the Carl 10 Moyer program to include additional pollutants, PM and 11 ROG. It also expands the eligible projects to include 12 light- and medium-duty vehicle projects. And this 13 includes an accelerated vehicle retirement usually 14 referred to as scrap programs and vehicle repair programs. 15 The bill also provides funding for the purchase 16 of new school buses pursuant the ARB's lower emission 17 school bus program. In addition, the bill allows the 18 purchase of retrofit repower or add-on equipment for 19 previously unregulated agricultural sources. 20 An important feature of AB 923 allows these 21 agricultural projects to receive incentive funds after the 22 adoption of new regulations by local air districts. 23 Existing law cuts off eligibility when some rules are 24 adopted, even though actual compliance dates may be far in 25 the future. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 124 1 Finally, the bill includes a funding formula for 2 grant distribution among mobile air districts. 3 Thankfully, the formula reflects a consensus agreement 4 among the local air districts. The bill calls on ARB to 5 update grant criteria and guidelines no later than January 6 1, 2006. 7 As I mentioned, there are 2 principal revenue 8 streams created by AB 923. 9 --o0o-- 10 LEGISLATIVE DIRECTOR OGLESBY: AB 923 authorizes 11 air district governing boards to increase local motor 12 vehicle registration fees by up to $2 up -- from $4 13 currently to up to $6 per vehicle, and that should raise 14 about $55 million. 15 The bill specifies that air districts may only 16 use the additional $2 increase on a set of proven 17 cost-effective emission reducing programs, including Carl 18 Moyer matching grants, low-emissions school bus 19 replacement programs, accelerated vehicle repair or 20 scrappage programs, and the repower or replacement of 21 agricultural sources of air pollution. 22 Air districts retain flexibility for the use of 23 revenues derived from the existing $4 fee, also known as 24 AB 2766 fees, to mitigate motor vehicle pollution for 25 planning. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 125 1 The second revenue stream is derived from a .75 2 cent California Tire Recycling Act fee. That should raise 3 about 25 million annually that will be administered by the 4 ARB. Revenue from the current fee is used to divert or 5 safely manage more than 33 million waste tires generated 6 in the state each year, and to clean up illegal disposal 7 sites. 8 The .75 cent increase is earmarked for air 9 pollution emission reduction programs that mitigate the 10 type of air pollution caused by tires, particulate matter. 11 It may surprise you to learn that tire wear accounts for 12 more than 8 tons per day of PM. 13 The Governor also approved hard-fought 14 legislation that improves the effectiveness of the 15 smog-check program. 16 --o0o-- 17 LEGISLATIVE DIRECTOR OGLESBY: AB 2687 by 18 Assemblywoman Lieber implements ARB recommendations from 19 smog-check program evaluations that took place in 2000, 20 and again in 2003. The bill also validates Governor's 21 campaign pledge to clean up the most polluting vehicles. 22 Current law exempts every car older than 30 years 23 from smog check. This is commonly referred to as the 24 rolling 30-year exemption. Older vehicles contribute a 25 disproportionate amount of the emissions despite their PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 126 1 relatively low numbers in use. 2 Excluding older vehicles that are most likely to 3 need emission related repairs, significantly reduces the 4 effectiveness of the smog-check program. In fact, 5 vehicles 20 to 30 years old fail smog check 30 to 40 6 percent of the time, compared to an overall fleetwide 7 failure rate of about 16 percent. 8 --o0o-- 9 LEGISLATIVE DIRECTOR OGLESBY: SB 2683 freezes 10 the rolling 30-year exemption. That means cars that are 11 currently exempt from the program stay exempt. But 1976 12 and newer cars will be retained in the smog-check program. 13 The bottom line in keeping the 1976 and newer 14 vehicles in the smog-check program will reduce 15 smog-forming emissions statewide by 5.7 tons per day in 16 2010. This is equal to the emissions from about 367,000 17 new 2004 vehicles. 18 --o0o-- 19 LEGISLATIVE DIRECTOR OGLESBY: In addition to the 20 continued smog-check exemption for pre-76 vehicles, car 21 enthusiasts were provided with an additional concession in 22 the form of a partial smog-check exemption for any 23 collector car used to exclusively for shows and parade 24 purposes. 25 Because required emission control parts may be PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 127 1 missing from these generally well maintained cars, no 2 visual inspections are required for these vehicles. But 3 these cars must still pass the tailpipe test. 4 --o0o-- 5 LEGISLATIVE DIRECTOR OGLESBY: These new 6 provisions complement existing smog-check program features 7 designed to help car enthusiasts and low-income vehicle 8 owners. 9 For example, the Bureau of Automotive Repair 10 already operates a toll free parts availability locator 11 service. And to address the financial burden on 12 low-income vehicle owners, the Bureau of Automotive Repair 13 offers an existing consumer assistance program that allows 14 qualified motorists to receive up to $500 in emissions 15 related repairs from the State. In addition, qualified 16 consumers can be eligible for a one-time repair cost 17 waiver. 18 I'm also happy to report the success of a bill 19 that authorizes the cleanest most fuel efficient hybrid 20 electric vehicles or HEVs to use carpool lanes. 21 --o0o-- 22 LEGISLATIVE DIRECTOR OGLESBY: AB 2628 by 23 Assemblywoman Pavley was jointly sponsored by the 24 Administration and the State Treasurer's office, partly to 25 provide an incentive to increase sales, but mostly to PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 128 1 increase public awareness of the cleanest and most fuel 2 efficient hybrid electric vehicles. Ultra clean, fuel 3 efficient hybrids support California's goals for clean 4 air, energy independence and reduce greenhouse gas 5 emissions. 6 HEVs use some of the same advanced technology 7 components as battery and hydrogen fuel cell vehicles and 8 offer a bridge to a zero emissions future. 9 Very briefly, AB 2628 would authorize new HEVs to 10 California's Advanced Technology Partial Zero Emission 11 vehicle, or ATPZEV standard and to achieve a 45-miles per 12 gallon fuel economy rating to use for the carpool lanes. 13 The bill grandfathers existing 2004 and older hybrids that 14 achieve a 45-mile per gallon fuel economy rating and meet 15 California's ultra-low emission vehicles standard. 16 The Bill limits the overall number of hybrids 17 that would benefit from an incentive to 75,000 vehicles 18 and directs the Department of Transportation to stop 19 issuing decals if significant congestion occurs. 20 Finally, the bill sunsets on January 1, 2008. 21 Now, federal law must also be amended to implement this 22 bill, and measures to do this are pending in Congress. 23 I'll quickly mention a couple of other signed bills. 24 --o0o-- 25 LEGISLATIVE DIRECTOR OGLESBY: The Governor PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 129 1 approved Legislation banning garbage incineration by 2 cruise ships near it's California shores, and that's AB 3 471 by Assemblymember Simitian, and legislation to ensure 4 foreign trucks entering California under NAFTA meet 5 federal emission standards. That's AB 1009 by Senator 6 Pavley. 7 --o0o-- 8 LEGISLATIVE DIRECTOR OGLESBY: The cruise ship 9 legislation is self-executing, but you will be asked to 10 approve regulations implementing foreign truck 11 restrictions by the end of next year. 12 --o0o-- 13 LEGISLATIVE DIRECTOR OGLESBY: ARB also 14 participated in a large number of special hearings on the 15 air quality issues. The number of these hearings has 16 increase significantly in recent years. And while special 17 hearings usually have been convened during legislative 18 recesses in the past, now many are concurrent with the 19 regular legislative sessions. And this is just a quick 20 menu of the ones we've participated on. 21 Let me turn to an issue that was not resolved 22 this past year. Air pollution related to the growing 23 activity at the State's courts and rail facilities. 24 Two major controversial bills attempted to 25 address this issue. Senator Escutia's SB 1397, that among PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 130 1 other provisions would have imposed a fee on locomotives 2 to fund local programs to mitigate rail emissions, and 3 Assemblymember Lowenthal's AB 2042 that attempted to 4 settle a local emission's ceilings at the ports of Los 5 Angeles and Long Beach. 6 SB 1397 the locomotive bill was opposed by the 7 ARB and failed passage. ANd SB 2042, the Port bill, was 8 vetoed by the Governor. 9 While I do not want to revisit the controversy 10 related to these bills in great detail, I want to 11 highlight these bills, because the issue that they intend 12 to address is important. And working on reducing 13 emissions from these sources is under way and will 14 continue. 15 --o0o-- 16 LEGISLATIVE DIRECTOR OGLESBY: Clearly, growing 17 economic activity at the port and railyards and other 18 intermodal transportation facilities has regional air 19 quality implications. But the most intense impacts are 20 filled by the neighboring communities that bear a greater 21 burden of exposure to toxic diesel particulates. 22 One of the key challenges facing these bills and 23 local and State efforts to reduce emissions from these 24 sources is the lack of State and local authority on ships 25 and locomotives. In fact, the Federal Clean Air Act is PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 131 1 explicit in reserving authority to regulate these sources 2 to the federal level. 3 In response, the Governor in his veto message of 4 AB 2042 directed the county and the ARB to work with the 5 Ports, the railroads U.S. EPA, local air districts and 6 local communities to develop a program to reduce emissions 7 from these sources. 8 --o0o-- 9 LEGISLATIVE DIRECTOR OGLESBY: He also urged the 10 South Coast District to make good use of the substantial 11 additional funds now available through the Carl Moyer 12 program and AB 923 to target emissions at these sites, and 13 ask the federal government to provide the necessary 14 regulations and incentives that would result in early 15 reduction of emissions related to goods movement. 16 --o0o-- 17 LEGISLATIVE DIRECTOR OGLESBY: The ARB Executive 18 Office is already making progress to achieve emission 19 reductions by regulation and negotiation from the rail 20 industry and the ports in a detailed board presentation on 21 this subject is planned for the near future. 22 --o0o-- 23 LEGISLATIVE DIRECTOR OGLESBY: In closing, I'm 24 going to draw your attention to our annual legislative 25 summary, which you should have before you, and copies both PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 132 1 in paper form and CD ROM are available to the public. And 2 the report can also be accessed on line from the ARB's web 3 site. 4 I want top thank you for your attention and on 5 behalf of the entire legislative office, I want to thank 6 the Chairman, Board Members, Ms. Witherspoon and the 7 Executive Officers and program staff for their steadfast 8 support and guidance throughout the year. 9 CHAIRPERSON LLOYD: Thank you very much, Rob. An 10 excellent presentation. Just 2 questions and then I'll 11 open it up to my colleagues. 12 When is the hybrid vehicle legislation effective? 13 You buy a certain vehicle now, can you access it or does 14 it become effective January 1? 15 LEGISLATIVE DIRECTOR OGLESBY: Well, technically 16 the bill has a statute that becomes effective January 1, 17 but it can only become operational upon passage of federal 18 legislation. 19 There are provisions to allow access that are 20 pending in Congress right now, as part of the 21 transportation funding package. In addition, there are 22 some discussions by individual members of Congress to 23 split that issue from the funding package and run a stand 24 alone bill. We'll see what happens when they come back 25 after this election break. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 133 1 CHAIRPERSON LLOYD: My understanding is that they 2 have such similar legislation in Virginia and they ignore 3 the feds. What happens if he California did that? 4 LEGISLATIVE DIRECTOR OGLESBY: Well, whether we 5 ignore the law isn't an avenue that we really explored. 6 (Laughter.) 7 LEGISLATIVE DIRECTOR OGLESBY: In general, we try 8 to avoid that. 9 (Laughter.) 10 EXECUTIVE OFFICER WITHERSPOON: Did the bill 11 include the language that federal authorization was 12 required or is that just -- 13 LEGISLATIVE DIRECTOR OGLESBY: The bill includes 14 that language federal authorization is required. The 15 issue, however, with Virginia is that they went ahead and 16 interpreted existing law. That was followed by a specific 17 inquiry to Transportation Secretary Mineta, who then 18 explicitly responded and said that federal legislation was 19 required. So the gray area was kind of removed by 20 communication from Secretary Mineta. 21 CHAIRPERSON LLOYD: I understand from Mr. Cunha 22 that Secretary Mineta is going to come out to California 23 next month or so, is that true? 24 BOARD MEMBER PATRICK: That's what he said. 25 CHAIRPERSON LLOYD: Well, maybe he's doesn't go PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 134 1 back until we get some more specific -- 2 (Laughter.) 3 CHAIRPERSON LLOYD: No, I'm not talking about -- 4 LEGISLATIVE DIRECTOR OGLESBY: Well, he doesn't 5 have interpretive authority and that was the essence of 6 his legislation. 7 CHAIRPERSON LLOYD: But the point is why, if this 8 is legislation, if we can't do anything about it, it's not 9 very -- 10 LEGISLATIVE DIRECTOR OGLESBY: Well, the 11 legislation is introduced in parallel with the federal 12 legislation. The California legislation proceeded through 13 the legislature and was signed into law. The federal 14 legislation is still pending. 15 CHAIRPERSON LLOYD: So the best -- 16 LEGISLATIVE DIRECTOR OGLESBY: It's just a matter 17 of time. 18 CHAIRPERSON LLOYD: So the best case on the 19 federal, when would that be? 20 LEGISLATIVE DIRECTOR OGLESBY: If they return 21 after the elections, it could happen then. It could 22 probably most likely beginning of next calendar year. 23 CHAIRPERSON LLOYD: All right. 24 BOARD MEMBER KENNARD: I have a question on the 25 same issue. One is do you have an idea of how many PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 135 1 vehicles are grandfathered? 2 LEGISLATIVE DIRECTOR OGLESBY: Twenty thousand. 3 BOARD MEMBER KENNARD: And is that part of the 4 75,000? 5 LEGISLATIVE DIRECTOR OGLESBY: It counts against 6 the 75,000. 7 BOARD MEMBER KENNARD: And then what happens in 8 2008, everything goes away, so if you have a hybrid 9 vehicle, you will no longer -- I mean would you anticipate 10 that -- 11 LEGISLATIVE DIRECTOR OGLESBY: By the time 2008 12 comes along there will be an evaluation. And we'll have 13 to look at the carpool lanes and see what level of 14 congestion exists and whether the program should be 15 continued or not. To continue it would take some 16 legislation at the State level. 17 CHAIRPERSON LLOYD: So the expectation would be 18 that the sales of the vehicle would have exceeded 75,000 19 by then anyway. 20 LEGISLATIVE DIRECTOR OGLESBY: Yeah. At that 21 point, the judgement has to be made whether the 22 vehicles -- the availability of the program will have 23 served its purpose. 24 CHAIRPERSON LLOYD: Supervisor Patrick. 25 BOARD MEMBER PATRICK: Thank you. I have a PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 136 1 question about the special hearings that you listed here. 2 Is this all of the special hearings or are there more that 3 you did? 4 LEGISLATIVE DIRECTOR OGLESBY: Those were -- 5 that's our best stab at a comprehensive list. 6 BOARD MEMBER PATRICK: Okay. Because I certainly 7 recognize a couple of these as being held in Kern County. 8 I think one of the most amazing things is that these sort 9 of come from out of nowhere, don't they. And, you know, 10 you're on a really short timeframe that all of a sudden 11 this thing is being held. 12 And your group always does such a great job on 13 very short notice at these special hearings. And so I 14 just want to pass along my compliments to you and to your 15 team, because whenever ARB is asked to attend any of these 16 special hearings, whether it's the legislative folks or 17 the policy folks, I mean it's really with a few days 18 notice, and they are there with a comprehensive report, 19 where everybody in the room can be assured that ARB is 20 just on top of everything. 21 So I want to pass that along to you and to all 22 the people that have been apart of these, because they 23 just -- my experience, again, has been that, you know, 24 like next we're having a hearing and you better be there 25 and you better be good. And you always are. So thank PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 137 1 you. 2 LEGISLATIVE DIRECTOR OGLESBY: You have the 3 Legislative office staff which works long hours to meet 4 that. And I want to thank you. But I also want to say we 5 the substantial resources of the ARB as a whole. We 6 appreciate the support we get. 7 BOARD MEMBER PATRICK: It's a good group. 8 Thank you. 9 CHAIRPERSON LLOYD: What would you say the major 10 challenge is of this upcoming year? 11 LEGISLATIVE DIRECTOR OGLESBY: I think that 12 there's going to be -- some adjustments are going to take 13 place in the Legislature because of the election of 14 course, but certainly because of the change in leadership 15 in the Senate. So we'll have to see how the membership 16 changes. And I think one of the significant changes of 17 this coming year as opposed to recent years is that a lot 18 of the members that have a lot of the -- a lot of the 19 senior members that have a lot of expertise in the very 20 complicated and deep issue of air quality -- it's not 21 simple subject as you all appreciate -- will be termed out 22 of the Legislature. So we'll lose some veterans. 23 The committee assignments will be changing. In 24 terms of topics, I believe that the intermodal 25 transportation issue is going to be a very active issue in PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 138 1 the coming year. And we'll continue to be focusing our 2 attention there. There will be light-duty vehicle issues 3 that we already are aware of are that are going to pop up, 4 and so those will be -- that will keep us busy. 5 CHAIRPERSON LLOYD: Dr. Gong. 6 BOARD MEMBER GONG: Could you comment on the 7 status of the California Performance Review? Is there 8 something going to happen next year? 9 LEGISLATIVE DIRECTOR OGLESBY: The results of the 10 panel -- 11 BOARD MEMBER DeSAULNIER: Will you still be here? 12 (Laughter.) 13 LEGISLATIVE DIRECTOR OGLESBY: The game plan 14 there is that the results of the panel is doing has done 15 the hearing now to submit the recommendations to the 16 Governor. And then the Governor's platform for pursuing 17 that will be unveiled in the coming year. 18 EXECUTIVE OFFICER WITHERSPOON: Though just last 19 week we received word that the panel itself had recanted 20 on its recommendation to eliminate the Air Resources Board 21 and the Water Resources Control Board, though not to 22 retain other CalEPA boards, such as the Waste Board. 23 When we saw the actual text of the write-up, it 24 was a little more ambiguous than that. It spoke about not 25 having sufficient justification and needing more analysis. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 139 1 And then it's final -- it was in bullet form and the final 2 bullet was well perhaps we should keep the Air Resources 3 Board but eliminate all the Air Pollution Control 4 Districts from them. 5 (Laughter.) 6 BOARD MEMBER DeSAULNIER: I can think of a 7 couple. 8 (Laughter.) 9 EXECUTIVE OFFICER WITHERSPOON: They opened up 10 another can of worms. But it is our sense that there will 11 be a recommendation in the final proposal from Governor's 12 office will retain the Air Resources Board. But we're 13 waiting to see if there will be hybrid forms, new advisory 14 committees, new consolidation at the staff levels and the 15 operational level within CalEPA, because the CPR retains 16 the Departmental structure for CalEPA itself. 17 And right now there's still independent agencies 18 overseen by Secretary Tamminen, but there might be some 19 further integration and revision down the road. 20 CHAIRPERSON LLOYD: Thank you. 21 Dr. Loveridge. 22 BOARD MEMBER LOVERIDGE: The first thing, one is 23 I look forward to the legislative authorization at the 24 national level. 25 One just quick point from southern California in PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 140 1 terms of goods movement. I think you're going to see good 2 smooth movement with the technical transportation issue 3 increasing the political issue. And if in the gateway 4 communities, some 2 million strong, identified problems 5 with air quality is a reason to oppose various kinds of 6 expansions at the port, both ports. 7 So I think the point of view of southern 8 California, Lowenthal et cetera, this whole question of 9 air quality and the ports and goods movement is going to 10 become more important for the region in southern 11 California. 12 LEGISLATIVE DIRECTOR OGLESBY: I think the 13 Governor's been really clear that he also considers it 14 important and that there should be substantial emission 15 reductions from those sources. 16 The Governor's communication on this point 17 indicates that he's interested in a multi-pronged report 18 that combines a regulatory incentive and to create where 19 necessary memorandums of understanding or other 20 cooperative agreements to get accelerated emission 21 reductions the ports. 22 The Governor also wanted to make sure that the -- 23 or wanted to encourage the local district there to make a 24 priority for some of the incentive funds that had just 25 been made available to be coming to that source -- to make PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 141 1 that source -- that area a priority. 2 BOARD MEMBER LOVERIDGE: Just two kind of 3 political science reflections. At the end, one you 4 mentioned that this was a good year, despite the budget 5 deficit, despite the emphasis upon the economy. How do 6 you explain a good year? 7 LEGISLATIVE DIRECTOR OGLESBY: A good year 8 because at a time of fiscal constraints, the Air Board's 9 program has clearly been represented as a priority. The 10 resources have been made available to continue effective 11 cost-effective incentive programs. And I'd also say it's 12 a good year because no negative -- no bills that would 13 have reduced our authority in areas were successful in the 14 legislature. So we retained authority, and had our air 15 quality programs strengthened, as a result of this. So in 16 that sense I say overall it was a very good year. 17 BOARD MEMBER LOVERIDGE: Just one quick 18 observation. In Congress they're very few pieces of 19 legislation that come have come out of committee. There 20 are not very many pieces of legislation that pass. IN 21 Sacramento you have all kinds of authorization, all kinds 22 of bills. So why the difference between what happens in 23 Congress versus what happens at the State Legislation 24 Level. 25 LEGISLATIVE DIRECTOR OGLESBY: In Congress PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 142 1 certainly there's a gate-keeping process that controls the 2 flow of bills. There traditions of the House that relate 3 to the way bills are formulated and developed before they 4 ripen and they're considered before. 5 There are rules that are different from 6 California rules related to the scope of bills that can be 7 considered in Congress. In California the Legislature of 8 course every bill can be set for hearing or heard at the 9 request of an author. Bills are limited to a single 10 subject rule, except the budget, which is a large bill. 11 And the norms of the House are to have more 12 engagement by all, even junior members of the Houses of 13 the State Legislature. 14 CHAIRPERSON LLOYD: Thank you very much, Rob. 15 I guess since we don't have any witnesses signed 16 up, Ms. Witherspoon, any further comments? 17 EXECUTIVE OFFICER WITHERSPOON: No further 18 comments. 19 CHAIRPERSON LLOYD: With that I guess since this 20 is not a regulatory item, it is not necessary to 21 officially close the record. But thank you, Rob, again, 22 an outstanding job with the staff. Thank you for the 23 report here. And we look forward to -- you've got a short 24 respite, I guess, off you go again. 25 LEGISLATIVE DIRECTOR OGLESBY: Thank you very PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 143 1 much. 2 CHAIRPERSON LLOYD: So great job. 3 With that, we're going to take a luncheon break 4 till 1:00. Let's be realistic, 1 o'clock. 1 o'clock on 5 that clock there. 6 (Thereupon a lunch break was taken.) 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 144 1 AFTERNOON SESSION 2 CHAIRPERSON LLOYD: The next item is Agenda 3 04-9-3, a status report on the catalyst testing that was 4 performed on inboard and sterndrive marine engines. 5 In July 2001 this Board approved exhaust 6 standards for the inboard sterndrive boats. The 7 regulations implement clean standards for 2003 and newer 8 engines, and catalyst-based standards that will be phased 9 in between 2007 and 2009. 10 As part of the 2001 rulemaking, the Board 11 directed staff to undertake a joint venture with 12 industry's participation to demonstrate the safety and 13 durability of catalysts in the marine environment. Today 14 staff will report to the Board the findings of the 15 catalyst test program. 16 At this point, I would ask Ms. Witherspoon to 17 introduce the item. 18 EXECUTIVE OFFICER WITHERSPOON: Thank you, 19 Chairman Lloyd. The staff's presentation this afternoon 20 is informational only. We're not proposing any regulatory 21 changes. However, staff will talk about some concerns 22 that industry has recently raised which may require 23 consideration of regulatory changes in the future. 24 This update focuses on results from the catalyst 25 test program for the inboard and sterndrive rulemaking. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 145 1 Staff will also cover recent events related to this 2 category including federal rulemaking, carbon monoxide 3 concerns and recent requests from the boating industry for 4 rule adjustments. 5 I'll turn the presentation over to Mr. Andrew 6 Spencer from the Mobile Source Control Division. 7 (Thereupon an overhead presentation was 8 Presented as follows.) 9 MR. SPENCER: Thank you, Ms. Witherspoon. Good 10 afternoon, Chairman Lloyd and Members of the Board. 11 This presentation will first briefly revisit the 12 regulatory actions that this Board has taken with regards 13 to recreational gasoline-fueled marine engines. Staff 14 will then summarize the on-water demonstration project 15 from marine catalysts, followed by other related issues of 16 importance that have occurred since the inboard sterndrive 17 rulemaking. And lastly staff's conclusions. 18 --o0o-- 19 MR. SPENCER: The first 2 vessel types to be 20 addressed will be the outboard boats and personal 21 watercraft or PWCs. Here is an image of an outboard boat. 22 Outboard engines come both in 2-stroke and 4-stroke 23 designs. The engine and propeller are assembled together 24 as a unit that is mounted external to the hull of the 25 boat, hence the name outboard. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 146 1 These engines range from 3 to 300 horsepower, and 2 are used in a variety of mostly recreational applications, 3 from small fishing boats to high performances cruisers. 4 --o0o-- 5 MR. SPENCER: Here is an image of a PWCs which 6 are commonly referred to by their trade names, jet skis 7 and Wave Runners. Engines in these vessels used to be all 8 2-strokes. After our regulations, the introduction of 9 clean 2- and 4-strokes began, both with rather impressive 10 emission levels and performance capabilities. 11 --o0o-- 12 MR. SPENCER: The U.S. EPA was the first to set 13 exhaust emission standards for outboard and PWC engines in 14 1996. Since 1998 outboards and PWCs have been subject to 15 these exhaust emission standards that, over the years, 16 become more and more stringent. In 2006, these federal 17 standards reach their most stringent levels. 18 --o0o-- 19 MR. SPENCER: Shortly after the federal 20 rulemaking, a revised emissions inventory was modeled for 21 California. The contribution from outboards and PWCs was 22 determined to be alarmingly high, particularly on summer 23 weekends. Because of this finding, California needed to 24 move ahead of the federal rule. In 1998, the Board 25 approved standards that required the 2006 federal PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 147 1 standards to start in California in 2001, followed by 2 2 additional tiers of more stringent standards in 2004 and 3 2008. 4 For this current 2004 model year, the second tier 5 of standards is in effect now, which are 20 percent 6 cleaner than our 2001 standards. In 2008, the third tier 7 of standards will be required. These are 65 percent 8 cleaner than 2001. 9 When proposed to the Board staff demonstrated 10 that this rulemaking was a cost-effective control measure, 11 resulting in emission reductions above and beyond those 12 that would have been obtained with the federal rule alone. 13 Further demonstrating the cost-effectiveness is 14 the fact that several manufacturers are already 15 demonstrating compliance with our 2008 standards. 16 --o0o-- 17 MR. SPENCER: The benefits of our regulations are 18 highlighted in this chart. The red base-line bars 19 represent the tons per day inventory with only the federal 20 standards in place. The reduced emissions inventory, due 21 to our more stringent standards, is shown in the green 22 bars. The combined HC and NOx reductions are 110 tons in 23 2010. 24 --o0o-- 25 MR. SPENCER: The next 2 vessel types to be PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 148 1 addressed are inboards and sterndrives. As with 2 outboards, the inboard name reflects the location of the 3 engine. In this image the engine cover is visible in 4 between the driver and passenger. Inboard boats like this 5 one are especially popular with water skiers. 6 --o0o-- 7 MR. SPENCER: The image on the left shows the 8 engine compartment of an inboard boat with its cover down. 9 The image on the right is a view of the engine with a 10 compartment hood open. The engine is an automotive V-8 11 engine that has been marinized for marine applications. 12 --o0o-- 13 MR. SPENCER: Here is an image of a sterndrive 14 boat. Unlike an inboard the engine is located at the very 15 rear of the boat. Much of the sterndrive unit can be seen 16 extending from the back end of the boat just above the 17 white water. 18 --o0o-- 19 MR. SPENCER: This is an image of V-8 engine 20 attached to a sterndrive unit. Sterndrives comprise about 21 two-thirds of all inboard and sterndrive sales. The 22 exhaust system is different from cars. The exhaust gases 23 go through water-jacketed exhaust manifolds, then through 24 the boat's rear wall and into the outer casing of the 25 sterndrive unit, where it finally exits into the water via PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 149 1 the propeller shaft. 2 --o0o-- 3 MR. SPENCER: Although there were standards in 4 place for outboards and PWCs, inboard and sterndrive 5 engines were still unregulated. Staff determined that 6 significant emission reductions could be achieved from 7 inboard and sterndrive engines. Therefore in 2001, staff 8 proposed exhaust standards, which the Board approved. 9 Because of this rulemaking, clean standards have 10 been in place for California since 2003 and will be 11 followed by catalyst based standards in 2007. 12 As part of that rulemaking, the Board directed 13 staff in Resolution 01-23 to undertake a joint venture 14 with industry to demonstrate that catalysts are safe and 15 durable in the marine environment. 16 --o0o-- 17 MR. SPENCER: Since the 2003 model year, as 18 mentioned in the previous slide, inboards and sterndrives 19 have been subject to a clean standard of 16 grams for 20 combined HC and NOx. This standard is equivalent to the 21 2008 outboard and PWC standard. 22 Beginning in 2007, engines meeting the 5 gram 23 catalyst based standard will be phased in over 3 years in 24 accordance with the percentages you see here. By 2009 all 25 new engines will comply with the 5 gram HC plus NOx PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 150 1 standard. 2 Included with the catalyst-based standards are 3 requirements for onboard diagnostics or OBD systems. The 4 OBD system is required to monitor the catalyst, fuel 5 system, oxygen sensor, and computer sensed engine 6 components. Misfire monitoring is optional. 7 To give the manufacturers flexibility, the OBD 8 systems can be a more basic design for the first 2 years. 9 In 2009, the OBD systems are required to be more advanced 10 in their monitoring. 11 Staff also demonstrated that this rulemaking was 12 a cost-effective control measure that would generate 13 significant emission reductions. 14 --o0o-- 15 MR. SPENCER: With the red bars again 16 representing the base-line, this chart shows the air 17 quality benefits of the inboard sterndrive rulemaking. By 18 2020, combined HC and NOx emissions will be reduced by 56 19 tons per day. 20 --o0o-- 21 MR. SPENCER: Now that the regulatory background 22 of gasoline marine engines has been summarized, staff will 23 move forward to the on-water catalyst project. 24 As directed by the Board, staff and industry 25 collaborated on this project with the aim of demonstrating PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 151 1 that catalysts were safe and durable when used in the 2 marine environment. 3 --o0o-- 4 MR. SPENCER: Besides ARB's financial 5 contribution and project management, the other 6 participants included members of NMMA, the National Marine 7 Manufacturers Association, who provided the boats and 8 engines; members of MECA, the Manufacturers of Emission 9 Controls Association, who provided the emission control 10 devices and related expertise; the United States Coast 11 Guard, who provided the personnel to operate the boats; 12 and SWRI, the Southwest Research Institute, who was 13 contracted to conduct the test program, which included 14 fabricating new exhaust systems and sampling the exhaust 15 emissions. 16 --o0o-- 17 MR. SPENCER: There were a total of 4 boats in 18 the project. The first phase of the project involved 19 fabricating the new exhaust systems with catalysts. The 20 engines also had to be fitted with closed-loop fuel 21 controls. Adding to the challenge was getting everything 22 to fit within the existing engine compartments on the 23 boats. 24 In the test plan, exhaust emissions were 25 scheduled to be sampled at 0 hours in the laboratory, PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 152 1 followed by samples taken while on the water, and then 2 laboratory testing again at the completion of 480 hours of 3 operation. 4 --o0o-- 5 MR. SPENCER: Here is a cut aware of a sterndrive 6 exhaust manifold, highlighting the differences between the 7 original automotive application and the marine 8 application. There is a double-walled exhaust manifold 9 and riser. The exhaust gas passages are colored red. The 10 white arrows show the flow of the exhaust gases. 11 The cooling water passages are in the outer wall 12 and are colored blue. In an automotive application water 13 jackets such as these are not used. In the upper right 14 corner just past the rubber coupling is the point at which 15 the water and exhaust gases mix. Downstream of this point 16 the exhaust is a mixture of liquid water and gases. This 17 is done to cool the exhaust gases for safety and to allow 18 the use of the rubber connections in the exhaust lines. 19 --o0o-- 20 MR. SPENCER: This illustration depicts the 21 catalyst-equipped exhaust system that was fabricated by 22 South West Research. Exhaust gases exiting the engine via 23 the exhaust manifold, shown by the red and yellow arrows, 24 flow into the sea-shaped riser on the left. The gases 25 then travel upwards and into the catalyst which is shown PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 153 1 directly above the engine. 2 At the far right is where cooling water is mixed 3 with the exhaust gases. For cooling purposes the exhaust 4 system is water-jacketed throughout, as the blue edging 5 along the exhaust system depicts. 6 --o0o-- 7 MR. SPENCER: Here are 2 images of a completed 8 engine that has been installed in an inboard boat. As the 9 image on the right shows Southwest Research was successful 10 in making the modified engine fit in the existing engine 11 compartment. 12 --o0o-- 13 MR. SPENCER: This chart highlights the emission 14 reductions that were obtained by modifying the exhaust in 15 fuel systems. Base-line exhaust emissions were first 16 sampled using the 5-mode steady state test cycle that is 17 used for certification testing. 18 After the catalyzed exhaust systems and 19 closed-loop fuel control systems were installed, the 20 5-mode test cycle was repeated. The combined HC and NOx 21 emission were reduced 80 percent or more. These are the 22 0-hour results. 23 --o0o-- 24 MR. SPENCER: This chart compares the HC plus NOx 25 emissions at 0 hours and at 480 hours, which is equal to PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 154 1 the 16-year useful life of the engine. As staff had 2 anticipated, the 480 hour levels are slightly higher. 3 Such levels indicate expected deterioration. As shown in 4 the first 3 comparisons, these engines remained well below 5 the 5-gram standard throughout the duration of the 6 project. 7 The comparison on the right is from an engine 8 that developed mechanical problems, which led to emissions 9 that slightly exceeded the 5 gram standards. 10 Specifically, low compression was discovered on 11 one cylinder, later determined to be caused by a burnt 12 exhaust valve. However, even under this condition, the 13 emissions are still well below the base-line levels. 14 Staff believes these data demonstrate that catalysts are 15 indeed durable and can function quite efficiently in the 16 marine environment. 17 Besides the durability concern, there were 18 concerns about safety, which revolved round the issue of 19 heat from the catalysts. The boating industry adheres to 20 a 200 degree standard for the outer or skin temperature of 21 the engine. 22 This chart shows the skin temperatures of the 23 catalysts that were measured while the engine was being 24 exercised over the 5-mode test cycle. 25 --o0o-- PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 155 1 MR. SPENCER: Staff believes these data, combined 2 with the fact that there were no heat-related safety 3 issues during the on-water operation, demonstrate that 4 catalysts are indeed safe in the marine environment. 5 --o0o-- 6 MR. SPENCER: Besides one engine developing low 7 compression, there were other mechanical problems that 8 were encountered. On 2 of the V-8 engines used in the 9 Malibu and MasterCraft boats, cracks developed in the 10 exhaust manifolds that led to excessive water into the 11 engine. Enough so, that the engines became hydro-locked, 12 which is a condition that prevents the engine from 13 running. 14 On the surface this may seem like a rather high 15 failure rate. However, staff has learned that these two 16 particular exhaust manifolds were of an older design with 17 limited water-jacketing, compared to the other two 18 manifolds that were of a newer design with full 19 water-jacketing and which did not crack. 20 The V-6 engine also developed a hot start problem 21 midway through the project, but was remedied by replacing 22 the ignition coil in a high tension wire. 23 One unfortunate boat, the Malibu, had its 24 propeller changed twice -- there's an image of one of them 25 there -- demonstrating that propellers are designed for PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 156 1 vessel propulsion not for chopping floating wooden logs in 2 half. 3 (Laughter.) 4 MR. SPENCER: But despite these problems, the 5 catalysts continue to function efficiently and safely. 6 Moreover, these mechanical problems that arose, were not 7 due to the installation of the catalysts for the emission 8 control systems. 9 --o0o-- 10 MR. SPENCER: A year after the ARB inboard 11 sterndrive regulations were approved, the U.S. EPA 12 proposed evaporative standards for gasoline marine 13 engines. This proposal contained both diurnal and 14 permeation standards. In recent discussions, the staff 15 has learned that EPA is still evaluating their evaporative 16 proposal. 17 More recently, EPA has begun to look at 18 establishing carbon monoxide standards for these engines. 19 Carbon monoxide exposure has become a common issue and 20 will be covered in more detail in the following slide. 21 --o0o-- 22 MR. SPENCER: EPA is also considering harmonizing 23 with California's catalyst based standards. Staff expects 24 to see EPA's revised proposal covering most of these 25 measures in early 2005. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 157 1 --o0o-- 2 MR. SPENCER: Since the 2001 hearing, exposure to 3 carbon monoxide emissions has become a very prominent 4 issue. In particular, there have been several news 5 reports that have focused on deaths that have occurred 6 including children who have been exposed to lethal levels 7 of carbon monoxide. 8 According to the National Institute of 9 Occupational Safety and Health or NIOSH concentrations as 10 high as 1,200 parts per million are immediately dangerous 11 to life and health. NIOSH has always established a 12 workplace recommended exposure limit or REL of 35 parts 13 per million for a full work shift. This REL is averaged 14 over 8 hours with a ceiling of 200 parts per million. 15 California ambient air quality standards for 16 carbon monoxide are 9 parts per million for 8-hour 17 standards and 20 parts per million for 1-hour standards. 18 Unlike occupational exposure standards that are 19 set for generally healthy adults, the California standards 20 are designed to protect even the most vulnerable 21 subpopulations against adverse health effects from 22 exposure. 23 The U.S. Coast Guard recently directed NIOSH to 24 conduct a carbon monoxide study at Lake Norman in North 25 Carolina. In the study were 16 recreational boats ranging PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 158 1 from new to 13 years old. None of which were equipped 2 with catalysts. The boats were evaluated while stationary 3 and at multiple speeds. Most of the boats generated 4 hazardous carbon monoxide concentrations often exceeding 5 the 1,000 parts per million limit of the measuring 6 equipment used in the study. 7 While stationary, the mean of the carbon monoxide 8 concentrations at the stern of many boats ranged between 9 500 to 1,000 parts per million. NIOSH staff conducted a 10 similar study on 2 of the catalyst-equipped boats in our 11 project. The concentrations that were measured indicated 12 that the carbon monoxide concentrations were low enough to 13 conform to NIOSH's workplace REL. 14 --o0o-- 15 MR. SPENCER: Besides directing the project at 16 Lake Norman, the U.S. Coast Guard has been holding 17 periodic workshops to discuss carbon monoxide exposure. 18 Efforts to educate boating enthusiasts about the dangers 19 of carbon monoxide and ways to avoid exposure are under 20 way. Lastly, Governor Schwarzenegger recently approved 21 legislation to make teak surfing a punishable offense in 22 California. 23 Teak surfing is an on-water activity in which a 24 person grabs the boat's rear platform and then gets towed 25 slowly around by the boat. The close proximity to the PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 159 1 exhaust leads to rapid exposure to dangerous 2 concentrations or carbon monoxide. 3 The combination of cleaner engines and an 4 educated boating community should lead to fewer cases of 5 these carbon monoxide poisonings. To that end, carbon 6 monoxide warning labels and related information will be 7 provided by the Department of Boating and Waterways and 8 the Department of Motor Vehicles by May 2005. 9 --o0o-- 10 MR. SPENCER: At the time of the 2001 hearing, it 11 was thought that industry would be best served by phasing 12 in the catalyst-based standards over the 2007 to 2009 13 timeframe. Since then, industry has reevaluated the 14 situation and is now requesting 100 percent implementation 15 in 2008. 16 Statewide the air quality impact of such an 17 alternative is negligible. Although some local districts 18 may be counting on the emission benefits of a partial 19 fleet of catalyst equipped boats in 2007. 20 --o0o-- 21 MR. SPENCER: Industry would also like the 22 regulations amended to allow their 500 plus horsepower 23 engines to be certified for sale by averaging them in with 24 the catalyst equipped engines. The existing regulations 25 require all engines to meet the 5 gram standards by 2009. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 160 1 Another item that industry is requesting to 2 change involves onboard diagnostics. Specifically, they 3 have requested a revised phase in. Their proposed Phase 4 1, which would still coincide with the introduction of 5 catalyst-equipped engines, would consist of all the 6 requirements currently in the regulations except for 7 catalyst monitoring. 8 Phase 2, which industry would like delayed until 9 2012, would add catalyst monitoring and misfire 10 monitoring. The current regulations phase in the OBD 11 systems in tandem with the phase-in of the 12 catalyst-equipped engines. 13 Lastly, industry would like to have a salt water 14 test program to demonstrate the effect of salt water on 15 catalysts. Staff believes that a full scale test, program 16 like the one we just completed, is not necessary. 17 Perhaps, some additional laboratory effort together with 18 EPA and industry would suffice to show that the presence 19 of salt on catalysts will not negatively affect catalyst 20 durability. 21 --o0o-- 22 MR. SPENCER: In conclusion, staff believes the 23 catalyst project successfully demonstrated that catalysts 24 are both safe and durable in the marine environment. 25 Staff also believes the project as further demonstrated PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 161 1 that the catalyst based standards are indeed achievable. 2 The staff is prepared to continue discussions 3 with industry to address their concerns and evaluate the 4 changes they are requesting. Staff also believes that 5 although a demonstration project as thorough as the one 6 just completed is not necessary to resolve any issues or 7 concerns with regards to salt water, a limited 8 laboratory-based study may provide useful information. In 9 2005 staff can return with proposed changes for the Board 10 to consider if necessary. 11 This concludes the staff's presentation. Staff 12 is ready to answer any questions the Board may have. 13 CHAIRPERSON LLOYD: Thank you very much. 14 Questions? 15 When the industry asked for an implementation in 16 2008 instead of the phase-in, what was the expected 17 phase-in percentage per year, was it uniform or was it -- 18 MR. SPENCER: No. In 2007 45 percent of sales 19 would be catalyst-based engines. In 2008 it would go from 20 45 to 75 and then by 2009 100 percent. 21 CHAIRPERSON LLOYD: So 2008 implementation. 22 MR. SPENCER: Yeah. So in the middle all of it 23 at one time is what they are requesting now. 24 CHAIRPERSON LLOYD: All right. It seems to be 25 stepping up. Seems to be reasonable. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 162 1 MR. SPENCER: Well, yeah. I mean there's a 2 slight delay, because we would have some catalyst runs in 3 2007. But yes then we'd get the entire fleet the 4 following year. So net, net by 2010, it's a wash. 5 CHAIRPERSON LLOYD: So when do you expect in 2005 6 to be coming back, what's the estimate? 7 MR. SPENCER: We can come back early with our 8 findings. And if we need to do any regulatory action, we 9 can do it later in the same year. There must be time to 10 speak with the manufacturers individually. 11 CHAIRPERSON LLOYD: Well, thank you very much. 12 I've got 2 witnesses signed up. Before we get to the 13 witnesses, just to let you know we are going to switch the 14 next 2 items. So we will have -- right after this, we 15 will do the reflash item and then we will do the one on 16 school bus. So that will make some people happy and some 17 people unhappy. But looking at the audience, it probably 18 will make more people happy than not happy. 19 But I recognize that people have traveled a fair 20 distance to look at the reflash. 21 So we have Richard Penna and Paul Roberts. 22 MR. PENNA: Thank you, Dr. Lloyd and Members of 23 the Commission. I'm Richard Penna. I'm counsel for the 24 National Marine Manufacturers Association. With me today 25 are Francine Martinson and Dana Ghast who are both of PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 163 1 Malibu Boats from Merced California, as well as Mark 2 Rickers from Mercury Marine and John McNight from the 3 National Marine Manufacturers Association. 4 At the outset, I'd like to thank the Board for 5 its staff for the cooperative attitude and efforts that 6 have been taken since the adoption of these rules in July 7 of 2001. The Staff's efforts leading up to and during the 8 Southwest Research Program have been helpful to all the 9 manufacturers of sterndrive inboard engines. 10 In particular, I'd like to thank Andrew who gave 11 the presentation, Jackie Lourenco, Mike Carter, Bob Cross 12 and their staff. They have worked pretty tirelessly on 13 this effort. So it's greatly appreciated from our 14 perspective. 15 Since there are several new board members since 16 2001, what I'd like to do is just give a very brief 17 overview of what this industry consists of so that some of 18 the things that I'll be talking about, some of the issues 19 that Andrew raised in his presentation you can put into 20 proper context. 21 The annual production of gasoline sterndrive 22 inboard engines is about 120,000 per year nationally. 23 Seven companies make these engines. There's 2, what I'll 24 call, large and put that in quotes "large" companies and 5 25 small businesses. Virtually, all the blocks for these PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 164 1 engines come from General Motors, and the total sterndrive 2 inboard production is about 2 to 3 percent GM's total car 3 and truck production for the United States. And it's 4 about -- it's slightly less than one percent of their 5 worldwide production of engines. So it's a very, very 6 small number of engines that we're talking about. 7 Many of the sterndrive inboard engines are used 8 in specialized boats such as ski boats that Malibu makes. 9 Malibu is a manufacturer of tournament water ski boats. 10 And they purchase their engines from Inmar Products, which 11 is a family owned company from Tennessee with about 50 12 employees. Inmar's entire engineering and compliance 13 staff is 4 people. So we're talking about very small 14 companies. 15 The 2 "large" companies, again put that in 16 quotes, Mercury and Volvo Penta, are smaller than all the 17 light-duty car and truck companies. They probably would 18 just barely make it into the intermediate vehicle category 19 of the LEV 2 rules. There's an argument as to whether 20 Volvo would or wouldn't. Mercury probably would just 21 barely make the 4,500 unit limit in sales for California. 22 So we're not talking about large amounts. 23 These 2 companies also have pretty limited 24 engineering staff due to the low volume of overall 25 production. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 165 1 The engines that these companies make are 2 generally sold to buyer groups. So that the engine 3 manufacturer really doesn't know where the engine goes 4 once they've produced the engine. The Malibu Inmar 5 example is really the exception and not the rule. 6 Typically what happens is these engines get sold. They go 7 to boat builders. The boat builder then installs the 8 engine, and the engine manufacturer has no idea where the 9 boat -- the boat where that engine is installed is going 10 to be sold. So there is -- I think that's going to be 11 important when we talk about the phase-in issues from 2007 12 to 2008. 13 NMMA is here today believes these rules are 14 national. Given the low volume that we have and the fact 15 that you really don't know where these engines end up, the 16 effect of these rules are national. And I think as 17 Andrew's presentation pointed out, EPA is likely to pick 18 up these rules and incorporate them in their upcoming 19 rulemaking as part of that. 20 So, in essence, the Air Resources Board has led 21 what's going on. And due to the volumes in this industry 22 it's pretty clear that these rules -- the effect of these 23 rules will become national. 24 We're here today to discuss really some minor 25 changes in rules we believe will decrease the burden on PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 166 1 the small businesses that make up much of the sterndrive 2 inboard industry, without affecting the environmental 3 benefits that come from this. 4 We'd also ask the Board to join within NMMA and 5 the Coast Guard in seeking support from U.S. EPA to do 6 some critical salt water testing and winter maintenance 7 testing of the catalyst systems to make sure that these 8 things are going to work in the way that people would 9 actually use boats in both the fresh water, salt water 10 condition. And these boats in the winter -- many parts of 11 the country, maybe not so much here in California, but -- 12 well, maybe up in Tahoe, but other parts of the country 13 these boats are out of water for a fair period of time. 14 And we also want to identify the onboard 15 diagnostic issue, where we think there's further 16 development that is going to be necessary because of the 17 unique situation that occurs with water. 18 CHAIRPERSON LLOYD: Could you try to summarize. 19 We've got this written down here. Recognize this isn't a 20 regulatory hearing, so staff has agreed to bring this 21 back. So highlight the key issues that you see from your 22 viewpoint -- 23 MR. PENNA: The key issues. 24 CHAIRPERSON LLOYD: -- and work with staff. 25 MR. PENNA: Right. The key issues go to the 2008 PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 167 1 implementation. The reason that we believe that is 2 necessary becomes a problem of the engine manufacturer has 3 no control on where those engines go. So in 2007 you go 4 to a dealership, and there may be a boat without a 5 catalyst and with a catalyst. There's going to be a price 6 differential. 7 The customer chooses the less expensive boat. 8 The engine manufacturer is the one that's on the hook, not 9 the boat builder, not the dealer, not anyone else. So we 10 feel from a competitive perspective, the 2008, which 11 requires everyone to comply at the same time, is 12 necessary. That's the 2008 issue. 13 With respect to the issue of the 500 horsepower 14 engines. There are probably in the hundreds of those made 15 a year. Out of 120,000, you're probably looking at under 16 200 done nationally. Most of those never end up in 17 California. Many of those end up outside the United 18 States. 19 What we're asking for is the ability for those 20 manufacturers to do averaging, banking and trading with 21 the other engines that they make. With respect to onboard 22 diagnostics, this is one where I think it's critical that 23 the engine manufacturers really sit down and work with ARB 24 staff, a staff who has graciously agreed to meeting -- 25 individual meetings, but also a collective meeting. Mike PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 168 1 McCarthy who is Onboard Diagnostics expert down in the El 2 Monte office has agreed to work with the individual -- to 3 work with the industry collectively and then there's going 4 to be individual meetings. 5 But the real issue there is the technology that's 6 used in automotive settings, that is the rear catalyst -- 7 the rear O2 sensor and the front O2 sensor doesn't work in 8 marine setting because you're bringing water back into the 9 exhaust system which literally will take out the O2 sensor 10 within a matter of days. And so you have to use other 11 means. And what we're trying to figure out is what are 12 those other means and can we implement those in the 2008 13 time period. 14 Finally, with respect to the salt water testing, 15 the Coast Guard has agreed to provide facilities, the 16 engine manufacturers and boat builders are going to 17 provide boats. We think this can be done quickly. We 18 agree it does not have to be as lengthy a process as the 19 original southwest research study, but we think that can 20 be done, we hope, by the summer of 2005. You know, 21 because everything is lined up to do it and we think that 22 is going to be critical, because again these boats are 23 used in both fresh water and salt water. 24 The final thing I'd like to do is talk for a 25 minute about where the industry is going with respect to PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 169 1 EPA rulemaking and CO2 and CO, I should say. 2 CHAIRPERSON LLOYD: That was good. 3 (Laughter.) 4 MR. PENNA: No CO2, sir. That was last month. 5 (Laughter.) 6 MR. PENNA: We've been working -- the industry 7 has been working closely with EPA and the Coast Guard over 8 the past several years on evaporative controls. This 9 effort is continuing. EPA is going to move forward with a 10 rulemaking probably early in 2005. And NMMA, the boat 11 builders, and particularly small businesses who make the 12 tanks, turns out that the people who make the tanks are 13 even smaller than the manufacturers. 14 There's 3 of them. Combined their employment is 15 under 300 people. It's really a tiny little industry that 16 is associated with the tanks. So we've been working 17 pretty closely with EPA on that rulemaking. With regard 18 to CO2, I think the data that you saw from the Southwest 19 Research Program shows that there's excellent reductions 20 in CO as a byproduct of putting the catalytic converters 21 on the sterndrive inboard engines. 22 And also we've worked with staff on the your 23 recently completed small off-road engines rules for the 24 marine generators. And the catalyst rules there we 25 believe also have the same type a very positive benefit. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 170 1 So NMMA believes both of these actions go along 2 way toward reducing CO on marine vessels. 3 So what we ask for is an indication today that 4 2008 is something that is going to be doable, understand 5 procedurally you cannot make a formal decision. But at 6 least from our planning perspective, the industry planning 7 perspective, we can have a sense that the Board believes 8 that this is something that is reasonable and doable. We 9 can plan accordingly and work with the staff so that we 10 can come up with regulatory language next year that would 11 work. 12 So that really concludes the presentation. Any 13 questions you have, I have a group of people back here who 14 would be more than happy to answer them. They know a 15 whole lot more about some of these issues than I do. 16 Thank you. 17 CHAIRPERSON LLOYD: Thank you very much. One of 18 the questions I'd like to ask staff, clearly the issue of 19 the 2008, and I know that staff highlighted there may be 20 implications on air quality, so I'd like to ask staff's 21 advice on that. 22 EXECUTIVE OFFICER WITHERSPOON: Well, Chairman 23 Lloyd, I did want to clarify that although we're open to 24 looking at this issue, it was brought to us fairly 25 recently, staff has not made any commitment yet or even PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 171 1 reached its own conclusion that there should be a delay in 2 any of the time tables you adopted in 2001. And also no 3 other stakeholder has had an opportunity to be aware that 4 this conversation is going on, and to weigh in with their 5 concerns. 6 I would disagree a little bit with the 7 characterization that it's a negligible impact on air 8 quality. There is a difference in 2007 and there's a 9 cumulative difference in 2010, which is our cause for 10 concern. The reason we're here today is because you asked 11 us to come back and report on how the catalyst program 12 testing was going and whether the reg is truly feasible. 13 And it wasn't meant to be, unless there was a problem, a 14 reopening of the regulation itself. 15 But having said that, staff is always available 16 to industry. And if there's a better way of getting the 17 job done, we're open to it. But I don't want to tell you 18 that we've concluded already that we would recommend. 19 CHAIRPERSON LLOYD: Why is there a cumulative 20 impact by 2010? 21 EXECUTIVE OFFICER WITHERSPOON: Because turnover 22 matters in the boating sector. And if you start a year 23 earlier, you have more cumulative reductions, even if you 24 move to 100 percent in the second year. 25 CHAIRPERSON LLOYD: The comment was made that PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 172 1 engines are going to go in 2008. 2 EXECUTIVE OFFICER WITHERSPOON: Well, that's an 3 issue that's why we're looking at it to see if in fact we 4 would accomplish what our regulations sets out to do. But 5 it's presuming that we would, it would be a net loss, you 6 know. 7 CHAIRPERSON LLOYD: Yes, Ms. D'Adamo. 8 BOARD MEMBER D'ADAMO: Could staff respond to the 9 issue of the salt water testing, and also I'm not quite 10 sure I understand it, but the concept of averaging and 11 training. 12 EXECUTIVE OFFICER WITHERSPOON: No. Mike, you 13 have to go to the podium. 14 MOBILE SOURCE CONTROL DIVISION CHIEF CROSS: Salt 15 water testing, we think that the test program which we 16 record ran did most of -- showed that most of the problems 17 which were supposed to be problems with catalysts aren't 18 problems. 19 With that said, I don't want to say that there 20 can't be any salt water problems. We will look at this 21 within industry, but I don't think we're, at this point, 22 ready to recommend a full blown program. I think we need 23 to look and say, okay, what's different about salt water 24 from the test program that we already ran, and how do we 25 focus on answering those questions. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 173 1 Really the question is related to the content of 2 the salt in the water, going through the system and coming 3 in. -- the salt content of the air that the engine ingests 4 and whether that's going to a problem or not. We will 5 look at that with industry. 6 BOARD MEMBER D'ADAMO: And then also on the 7 weather issue, the conditions -- weather conditions, I 8 believe was -- 9 MOBILE SOURCE CONTROL DIVISION CHIEF CROSS: Oh, 10 the wintery conditions. I think that's probably a matter 11 of getting the -- making sure they can get the system dry. 12 In other words, if you have freezing problems, it could 13 damage the catalyst, but it could also damage the engine 14 block. 15 EXECUTIVE OFFICER WITHERSPOON: Can you address 16 averaging too, Bob. 17 MOBILE SOURCE CONTROL DIVISION CHIEF CROSS: 18 Averaging, the engine -- the 500 horsepower engine we did 19 make this and the Board made a conscious decision to 20 insist on controlling those engines. And I think we had 21 the data back then, which showed that they were a fairly 22 small part of the population. 23 With that said, let us look at it again as part 24 of the other stuff that we're looking at, because I think 25 that the technical job of making the 500 horsepower engine PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 174 1 comply is much, much harder than the would involve the 2 littler ones. And it may turn out that the sales numbers 3 that he's talked about are sure to come back on that. 4 So the overall story is let us meet with the 5 industry over the next month or so and bring back our 6 proposal for the industry. 7 BOARD MEMBER D'ADAMO: Okay. Thank you. Maybe 8 just a comment getting back to the salt water issue and 9 the weather conditions. The concern that I'm sure we all 10 share is that we want to make sure that this works. It 11 doesn't produce any performance -- significant performance 12 or safety issues. So hopefully you'll be able to work 13 that out. 14 MR. PENNA: Yeah, the wintering issue is one, as 15 Bob points out, you need to dry the system out. But 16 typically what people do is they fog the engine with foil 17 to keep the engine from rusting, corroding on the inside 18 the engine. And so the effect of that burning that out, 19 we think that can be done very quickly, the testing for 20 that. Dr. Lloyd, your look surprised. But that is a. -- 21 CHAIRPERSON LLOYD: Well, the thought of burning 22 oil off is not -- 23 MR. PENNA: Well, that's right. That's what the 24 issue is. So we think -- 25 MOBILE SOURCE CONTROL DIVISION CHIEF CROSS: It PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 175 1 won't hurt it. 2 CHAIRPERSON LLOYD: What? 3 MOBILE SOURCE CONTROL DIVISION CHIEF CROSS: It 4 won't hurt it. The catalyst will just burn it up. 5 CHAIRPERSON LLOYD: What about us though? 6 (Laughter.) 7 MR. PENNA: We think that there are materials 8 that can be used that will do the job. What we want to do 9 is test those out so the manufacturers can recommend those 10 to their customers, you know, and their owner's manuals 11 and service managers. We want to make sure that what is 12 going to be recommended is not going to do any harm to 13 them. 14 CHAIRPERSON LLOYD: Questions, comments? 15 Well, I think the request from staff is try to 16 move as quickly as possible, particularly on that issue of 17 the 2008, because certainly it is important for the 18 industry, so the sooner we can bring that forward. But I 19 respect the wisdom of staff to look at all of the issues 20 around this. 21 MR. PENNA: Thank you very much. 22 CHAIRPERSON LLOYD: Thank you very much. Paul 23 Roberts. 24 MR. ROBERTS: Thank you, Chairman Lloyd and 25 Members of the Board and ARB staff. First, I want to PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 176 1 strongly support the type of research that was done that 2 the ARB staff has presented today. And this real world 3 testing of new control systems first spark ignition, 4 inboard and sterndrives is really important for making 5 sure we can control VOC and NOx and make sure that that's 6 possible. 7 You know and certainly this is very much more 8 important as control of existing traditional sources 9 reduced, these smaller sources that used to be not very 10 important become more and more important in our ozone 11 plans like this morning. It was also very important that 12 ARB staff concluded CO as a test parameter in these tests 13 that the Southwest Research Institute ran. 14 You know, most of the regulations focused on the 15 VOC, NOx and those controlled. But I want to spend a 16 couple minutes actually talking about the CO issue and 17 that's what I want to add and bring to the Board today. 18 CO is a recognized major health hazard around 19 operating recreational boats. And really there's 3 areas 20 that were briefly mentioned earlier that are really of 21 concern. One is the teak surfing issue. One which you 22 probably heard about is CO from generators on houseboats 23 especially on Lake Powell. 24 And the third is really accumulation of CO when 25 there are numerous numbers of boats what are operating in PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 177 1 a fairly small self-contained area. 2 And of those really AB 2222 is part of how you 3 address the teak surfing issue. Obviously, education is 4 very important there too. And the manufacturers have 5 really retrofitted the exhausts on houseboats, and I think 6 that's a major step towards improving that. I'd like to 7 talk about the third issue a little bit here. 8 So we were involved in some work at the bridge 9 water channel, which is the waterway under the London 10 Bridge on Lake Havasu. And the study we did demonstrated 11 very high concentrations of CO late in the afternoon, and 12 this is a semi-open. This is not a closed area. There's 13 banks around it that are 10 or 15 feet high a ways away 14 from the water. 15 And I've attached a NIOSH publication that came 16 out of some of the work we did with NIOSH, and you can 17 look at that later. 18 Just in summary, in this case the CO 19 concentrations on holiday weekends increase quite rapidly 20 in the late afternoon when the winds die down. And there 21 are hourly CO concentrations in the 20 to 120 EM range. 22 And you heard staff say early, you know, our CO standard 23 here in California is 9. 24 And this lasted for several hours, and 25 potentially exposed boaters and the public and the public PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 178 1 safety workers to CO concentrations above the NIOSH 2 standard of -- they were recommending 35 ppm over an 3 8-hour workday average. 4 You know, there were short-term CO concentrations 5 that we measured on boats that were often over 200 ppm. 6 And the maximum 8-hours were 20 to 40. 7 And in the context of doing this, we did some 8 simple calculations. And it turns out if you just compare 9 current motor vehicle and current boat emissions, the 10 ratio is about 188. So it takes 188 current cars to emit 11 about the same as one uncontrolled boats. 12 So that's obviously why control regulations are 13 going the way they are at EPA, and that your putting in., 14 And I think that's very important. To carry CO along with 15 VOC and NOx, we have to be concerned about those. 16 I guess I'm concerned about the situation like in 17 bridge water channel may exist in places in California. 18 And part of the reason I think this is not thought about 19 too much is most emergency rooms do not do CO blood levels 20 on people that drowned, or alcohol level often, too. And 21 in fact a few tests have been done like that and CO has 22 been a contributing factor to the death of boaters. 23 I think that the issue may be worse than that, we 24 didn't really know. But if you take the situation at 25 bridge water channel and say might that be occurring other PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 179 1 places? 2 I've listed a number of places around California 3 where this may be an issue too. And we're talking about 4 cases where there's operating boats and basically low wind 5 speed. So in the middle of the day if the wind speeds are 6 high, I don't think this is an issue. 7 But for instance near marinas and protected coves 8 on recreational lakes and rivers and if we think about 9 where the marinas are at Lake Shasta, for example, or Lake 10 Mendocino, or in Sonoma Berryessa, Folsom, even Tahoe or 11 Lake Arrowhead, there could be places where the CO would 12 not get blown away even if just a few boats are operating, 13 the CO concentrations might be high. 14 Similar situations might exist in narrow or 15 protected channels, such as where people ski and fish in 16 the Sacramento River, Delta, or sometimes just boats hang 17 out in those places together and they continue to run 18 their engines. Part of the problem here is they want to 19 run their stereos, and they run their engines to keep 20 their batteries charged. So even when they're sitting 21 still sometimes, there's CO emissions. 22 And, you know, there's sort of informal docking 23 areas along the Delta for houseboats and ski boats in the 24 summer. So those are the kinds of areas I'm concerned 25 about that still might be places where CO is a potential PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 180 1 hazard for boaters. 2 If high CO concentrations exist at such locations 3 in California, then members of the public may be exposed 4 at levels over the established limits, much like what was 5 going on at Lake Havasu. 6 To take a measurement survey of several 7 California locations most likely to exhibit high CO 8 concentrations could help ARB evaluate whether this is a 9 possibility within our community. And if they were 10 documented as high, then you could obviously review and do 11 some analysis on that and understand whether there may be 12 actions warrant. 13 And part of the concern here is that these 14 regulations are coming along, but the turnover in boats is 15 actually much lower than the turnover in automobiles. So 16 just because we have new regulations that I think are very 17 good, coming along in '08 say, you know, these boats last 18 20 years. I think, you know, the 480 hours represented a 19 16-year life cycle of those boats. So the turnover is 20 kind of slow. 21 We have this intermediate period where we need to 22 be concerned about educating the public and making sure we 23 don't have other areas which may be of concern. 24 In addition, I think it would be valuable to 25 conduct more complete review of existing boat engine PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 181 1 emissions data, specifically for CO, especially at low 2 operating speeds when the engines are sometimes operating 3 at non-optimum conditions. And that's the kind of case 4 that often goes on at Lake Havasu and maybe some of these 5 other locations. And certainly future boat emissions 6 testing should include data for CO not just VOC and NOx. 7 I guess I'd like to point out one other thing in 8 the Southwest Research demonstration study. You know, the 9 CO concentrations just because of the control technology 10 were reduced by about 50 percent on 3 of the 4 boats. The 11 smaller engine did not result in that much improvement. 12 You know, we don't really know whether that's enough to 13 get us underneath these kinds of health problems. 14 So I appreciate you listening. I just think the 15 CO issue for boats needs to stay up on our list. It can't 16 be dropped off. And I'd be happy to answer any questions 17 if there are any. 18 CHAIRPERSON LLOYD: Thank you, Paul. 19 Thank you for work. I know it's interesting. 20 Dr. Gong. 21 BOARD MEMBER GONG: Just a comment. Thank you 22 for your information. It's educational, but I think it 23 just -- to me, I've heard the same stories. It reminds me 24 of basically like a parking lot enclosed parking lot, 25 basically leave the cars running, idling and that's in PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 182 1 essence what's happening at times even in so-called open 2 spaces. 3 Another point is that I agree with you the carbon 4 monoxide is a very serious health issue. It's very 5 insidious in its poisoning of people. And, in essence, 6 it's very -- how should I say -- it will kill you before 7 VOCs and nitrogen oxides. So I think we need to have it 8 on the radar, like you said. 9 MR. ROBERTS: Thank you. 10 CHAIRPERSON LLOYD: Thank you very much. 11 Any other questions, Board Members? 12 Comments from staff? 13 EXECUTIVE OFFICER WITHERSPOON: I would say we 14 agree that the CO issue is huge. It's a reason to proceed 15 with catalyst standards. It's a reason to be prompt. Its 16 a reason to consider the South Coast's proposals, which 17 you heard, not only considering the South Coast's plan in 18 October of last year, I think that was, where they 19 proposed a scrappage program. And we said great idea why 20 don't you undertake one, because the district has the 21 authority to initiate such an activity and now has funding 22 from the Carl Moyer program expanded for ozone precursors, 23 which are crucial. And boats are a huge player in that 24 out through 2010, especially in South Coast. 25 And as far as the monitoring proposal, if we're PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 183 1 looking at some of the lakes likely to have the highest CO 2 readings, we'll have to go back and look at what that 3 might cost and what we could integrate in. But the Air 4 Board perhaps could focus on the areas, the entertainment 5 regions that aren't going to get attention in the same way 6 that recreational boating in nonattainment areas is being 7 looked at because of its ozone contribution. 8 CHAIRPERSON LLOYD: I guess this is not a 9 regulatory so it is not necessary to officially close the 10 record, but I guess thanks to staff and we expect to hear 11 from you. 12 With that, we'll move onto the agenda item that 13 last. And while we take time for staff to turn over we'll 14 take an opportunity to have Dr. Loveridge say a few words 15 from his appointment by Governor Schwarzenegger. Because 16 of a prior commitment this is his first board meeting. So 17 Dr. Loveridge will give you an opportunity to say a few 18 words. Welcome to the Board. 19 BOARD MEMBER LOVERIDGE: Just thank you for your 20 welcome. I look forward to more discussions on this 21 board. 22 It's an honor to be member of the Air Resources 23 Board. I look forward to serving. I spent some 10 years 24 on the South Coast board representing an area where air 25 quality is very poor important in terms of quality of life PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 184 1 and the future we want for the eastern end of the south 2 coast basin. 3 I look forward to the Board agenda and being on 4 the board and participating. I'm honored to be a part of 5 the Board. 6 CHAIRPERSON LLOYD: Welcome, Dr. Loveridge. I'm 7 aware of your contribution over the years at South Coast. 8 I would say, by the way, having somebody 9 reminding me earlier of the SIP last year that we were 10 rightly chastised for doing our part because the air 11 quality was getting worse in the south coast last year. 12 We hope that because of the dramatic improvement this year 13 we get credit for the improvement, that we've done our 14 job, dramatically reducing mobile source contributions. 15 BOARD MEMBER DeSAULNIER: That might have 16 something to do with the representative on the Board. 17 (Laughter.) 18 BOARD MEMBER LOVERIDGE: I'm not sure that -- 19 CHAIRPERSON LLOYD: We didn't think so last year 20 either. 21 Anyway, welcome. 22 So with that, I would like to introduce the item. 23 Interim report on the installation of low NOx software 24 also known as chip reflash on heavy-duty Diesel trucks. 25 In March of this year the Board adopted a PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 185 1 regulation mandating the installation of new software in 2 certain diesel trucks. However, we decided to stay that 3 regulation temporarily pending the outcome of a voluntary 4 reprogram to reflash the affected trucks. 5 The final report back from staff on the voluntary 6 program is not due until our December meeting. And I 7 suggest to my colleagues that we all withhold judgment 8 until that time. 9 But I also wanted to respond to Supervisor 10 DeSaulnier's request that we look at preliminary results 11 available in September. The staff has done so, and is 12 prepared to report back on the preliminary results. 13 Again, I think we want to -- I think we'll also 14 be hearing from the California Trucking Association that 15 has made an extraordinary effort to get the word out to 16 its members and to get the trucks reflashed. 17 I think that we were impressed at the March board 18 hearing of Stephanie's plans to outreach to their members. 19 And I understand CTA has delivered very much on that 20 promise. 21 I sincerely appreciate the efforts CTA has made 22 in this regard in recognizing that this is a tough issue 23 and we look forward to a status report today. 24 I also again remind my colleagues on the Board or 25 the new members that in this particular regulation, we put PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 186 1 a stay because there was some concern whether we had the 2 authority or whether we would be sued. But also we 3 thought that with a new administration this was a chance 4 to see whether a voluntarily program would work. So this 5 is very much sort of a work-in-progress. And we're 6 hopeful that it would work out, because of previous 7 history we weren't completely confident that would be the 8 case. 9 So this gives us an opportunity today to see 10 exactly where we are. So with that I'll turn it over to 11 Ms. Witherspoon to introduce the item and begin staff 12 presentation. 13 EXECUTIVE OFFICER WITHERSPOON: Thank you, Dr. 14 Lloyd. As you indicated in March the Board directed staff 15 to proceed with a voluntary chip reflash program to 16 attempt to achieve the same tonnage reductions through 17 that process as we were counting on from the low NOx 18 software upgrade regulations that you also adopted in 19 March. 20 At that time, the Board also established specific 21 milestones for gauging progress to determine whether the 22 voluntary approach is working. The California Trucking 23 Association stepped up to the plate immediately in terms 24 of reaching out to its members in the trucking industry. 25 Staff will talk more about those efforts, but I'd like to PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 187 1 personally thank Stephanie Williams and her staff for 2 their hard work and partnership in implementing the 3 voluntary program. It was not for lack of trying. 4 But for the fine work that's been done, the 5 preliminary results are not as robust as staff had hoped. 6 As of September 1st our preliminary numbers suggest that 7 only 15 percent of the California engines eligible for low 8 NOx software upgrades have been reflashed. This suggests 9 that when we report the final results to you in December 10 we may fall short of the 35 percent goal you established 11 for that date. 12 I'll now turn the presentation over to Mr. Earl 13 Landberg. 14 AIR POLLUTION SPECIALIST LANDBERG: Thank you, 15 Ms. Witherspoon. Good day Chairman Lloyd and members of 16 the Board. 17 (Thereupon an overhead presentation was 18 Presented as follows.) 19 AIR POLLUTION SPECIALIST LANDBERG: We are today 20 to provide and interim update on the heavy-duty diesel 21 engine software upgrade program that the Board approved in 22 March of this year. 23 In my presentation to you today, I will discuss 24 the background of this program, including a brief history 25 of the federal consent decrees and the California specific PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 188 1 settlement agreements. The software upgrade regulations 2 which the Board adopted in March, and the efforts and 3 preliminary results of the voluntary program to install 4 low NOx software to reduce emissions of oxides of nitrogen 5 from eligible engines. And finally the next steps that 6 will occur up to and including your evaluation of the 7 program on December 9th. 8 --o0o-- 9 AIR POLLUTION SPECIALIST LANDBERG: First, I will 10 review the background information to set the stage for 11 this update. 12 --o0o-- 13 AIR POLLUTION SPECIALIST LANDBERG: Prior to the 14 1990s, mechanical controls were used to control the engine 15 parameters that affect diesel emissions. As emission 16 standards became more stringent in the early 1990s engine 17 manufacturers replaced the mechanical controls with 18 computer controlled systems. These computer controlled 19 systems could provide precise controls of the timing and 20 the amount of fuel injected into the engine that was 21 necessary to meet low-emission standards. 22 Many of the heavy-duty diesel engine 23 manufacturers also used new flexibility to control engine 24 parameters to include fuel consumption, especially during 25 highway operation. Unfortunately, the techniques they PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 189 1 used also caused NOx emissions to increase by a factor of 2 2 to 3. They were able to do this because the emission 3 compliance test does not include much highway driving, and 4 thus the high NOx emissions do not prevent them from 5 meeting emission standards. 6 The high NOx emissions during highway operations 7 are referred to as off-cycle NOx. The computer 8 programming that created these high emissions is called a 9 defeat device. 10 --o0o-- 11 AIR POLLUTION SPECIALIST LANDBERG: This is a 12 graph of an actual emission test of a 1998 model year 13 truck performed at ARB's Stockton laboratory. The engine 14 is in the low-emission mode for about 220 seconds. When 15 the engine senses it is no longer in urban driving, 16 typical of the emission compliance test, the computer 17 selects the high NOx mode that provides better fuel 18 economy. In this test the concentration of NOx nearly 19 doubles. 20 --o0o-- 21 AIR POLLUTION SPECIALIST LANDBERG: After the 22 problem of high off-cycle NOx emissions was discovered, 23 the U.S. EPA, the ARB and the U.S. Department of Justice 24 negotiated legally binding agreements with the affected 25 engine manufacturers in 1998. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 190 1 The federal agreements are called consent 2 decrees, while the California specific agreements are 3 called settlement agreements. These agreements include a 4 number of mitigating provisions. 5 One of the provisions is the low NOx rebuild 6 program that requires the engine manufacturers, which are 7 listed on this slide, to partially mitigate the high NOx 8 emissions caused by their engines. The low NOx rebuild 9 program requires the engines manufacturers to provide a 10 fix to the high NOx emissions created by their use of 11 computer based strategies. 12 The fix is called low NOx software upgrades. The 13 process of installing low NOx software upgrades is 14 sometimes referred to as reflashing the engine or chip 15 reflash. Under the low NOx rebuild program the low NOx 16 software upgrade is to be installed at the time of engine 17 rebuild or upon request by the vehicle owner or operator. 18 --o0o-- 19 AIR POLLUTION SPECIALIST LANDBERG: During the 20 time that the consent decrees and settlement agreements 21 were negotiated, the U.S. EPA and the ARB expected engine 22 rebuild to occur at 350,000 miles per line haul truck. 23 These are trucks that travel long distances primarily on 24 highways and at about 300,000 miles for other heavy-duty 25 diesel trucks and vehicles. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 191 1 However, engines are lasting up to 750,000 to 1 2 million miles before rebuild is necessary. As a result, 3 relatively few low NOx software upgrades have been 4 installed. In fact, as of March 31st, 2004 only 13 5 percent of the engines eligible for the low NOx software 6 upgrade have been reflashed. That means the majority of 7 the 1993 through 1999 model year vehicles equipped with 8 engines using defeat device software programming continue 9 to emit at high levels of NOx. 10 --o0o-- 11 AIR POLLUTION SPECIALIST LANDBERG: Once solution 12 to reduce the high off-cycle NOx emissions is to require 13 the installation of low NOx software upgrades on every 14 eligible engine as soon as possible. 15 --o0o-- 16 AIR POLLUTION SPECIALIST LANDBERG: The 17 regulation adopted by the Board in March is applicable to 18 1993 through 1999 model year heavy-duty diesel trucks, 19 school buses and motor homes that are equipped with 20 specific 1993 through 1998 model year engines that have 21 high NOx emissions. We include 1999 model year vehicles 22 because some of these use 1998 model year engines. 23 The Regulation applies to all heavy-duty diesel 24 vehicles with applicable engines that operate in 25 California. This includes vehicles registered out of PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 192 1 state that travel into and within California. 2 The Regulation excludes engines that are not 3 electronically controlled or to which low NOx software has 4 not been developed. 5 --o0o-- 6 AIR POLLUTION SPECIALIST LANDBERG: At the March 7 2004 hearing, the Board adopted the mandatory NOx software 8 upgrade regulations proposed by the staff, but also proved 9 the implementation of a voluntary program for the 10 installation of low NOx software upgrades. A voluntary 11 program is yet another solution to reduce high off-cycle 12 emissions. 13 In approving the voluntary program the Board 14 directed the staff to hold filing of the Regulation with 15 the Office of Administrative Law until the Board has a 16 chance to review the results of the voluntary program. 17 This means the Regulation is a backstop only to be 18 implemented if the Board determines the voluntary 19 reprogram has not achieved its emission reduction targets 20 or if achieving future emission reduction targets does not 21 appear sustainable. 22 The formal review of the voluntary program is 23 scheduled to take place at the December 9th, 2004 public 24 hearing. The Board also suggested we might obtain a 25 glimpse of how the voluntary program is working by looking PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 193 1 at data collected through the summer. This is the reason 2 why we are reporting to you today, 6 weeks in advance of 3 the December board meeting. 4 --o0o-- 5 AIR POLLUTION SPECIALIST LANDBERG: The voluntary 6 program is a cooperative effort between the vehicle 7 owners, the California Trucking Association, California 8 dealers, the engine manufacturers and the ARB staff to 9 install low NOx software upgrades on a voluntary basis. 10 The goal of this program is to achieve the same 11 emission reductions by 2008 from California registered 12 heavy-duty diesel vehicles as could be achieved through 13 the Regulation. 14 --o0o-- 15 AIR POLLUTION SPECIALIST LANDBERG: Part of the 16 Board's action in March 2004 was to establish performance 17 targets for the voluntary program. The first target is to 18 achieve 35 percent of the emission reduction benefits of 19 the regulatory program with reflashes performed through 20 October 28th, 2004. 21 At the December board meeting, we will report if 22 this goal has been met. We will also report whether the 23 rate at which reflashes are occurring is sufficient to 24 allow meeting the 60, 80 and 100 percent targets listed on 25 this slide. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 194 1 --o0o-- 2 AIR POLLUTION SPECIALIST LANDBERG: I'm now going 3 to discuss the outreach efforts by the various parties 4 involved in the voluntary program, as well as the 5 technical work performed by the ARB staff to track the 6 reflashes reported to us through August 31st. 7 I will start with the outreach performed by the 8 ARB staff. In general, we have been actively involved in 9 an outreach effort since March 2004. We have worked 10 closely with the California Trucking Association, the 11 engine manufacturers and the software upgrade coordination 12 group to raise awareness to the program. 13 Specifically, we generated and mailed out over 14 60,000 letters in English and in Spanish to owners of 1993 15 through 1999 model year heavy-duty diesel vehicles. We 16 sent letters to truck owners, motor home owners and school 17 districts. We initiated telephone calls to approximately 18 200 authorized dealers and distributors to inform them of 19 the voluntary software upgrade program. 20 In addition, we also responded to telephone calls 21 from numerous vehicle owners about the low NOx software 22 installation program and have bilingual staff available to 23 assist in these efforts. 24 The ARB enforcement staff distributed a low NOx 25 software upgrade brochure and staffed a booth at the PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 195 1 International Truck Show in Anaheim in September to 2 promote low NOx software upgrades. 3 --o0o-- 4 AIR POLLUTION SPECIALIST LANDBERG: As was 5 discussed at the March meeting, the engine manufacturers 6 testified that they know the serial numbers of high NOx 7 engines, but don't know the identification of the vehicles 8 in which the engine is installed. Staff identified those 9 California registered vehicles that may have a high NOx 10 engine and worked extensively with the truck builders to 11 match the truck ID to the engine. 12 This way when the engine manufacturers report an 13 engine has been reflashed, we can determine if it is one 14 of the vehicles subject to the voluntary program and not 15 one that is based out of state. 16 This took months of effort, but we now are 17 confident we can report accurately the progress toward 18 meeting the goals established by the Board. 19 --o0o-- 20 AIR POLLUTION SPECIALIST LANDBERG: At the March 21 hearing the California Trucking Association committed to 22 conduct extensive outreach throughout the State to raise 23 awareness of and promote participation in the voluntary 24 programs. I am very pleased to report that the California 25 Trucking Association came through on that promise and we'd PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 196 1 like to publicly to thank everyone involved for their huge 2 efforts. 3 Guided by Stephanie Williams and Staci Heaton, 4 the California Trucking Association held outreach events 5 in its regional unit areas to raise awareness within the 6 trucking community. As part of these outreach events, 7 meetings with authorized dealers and distributors were 8 conducted to specifically inform them of the program, 9 answer questions, relay the experiences of other dealers 10 and distributors and assess their level of program 11 awareness. 12 To top off these meetings, a lunch-time barbecue 13 for the dealers, distributors and truckers provided the 14 ARB staff the opportunity to answer questions about the 15 program and allow truck owners to network with area 16 dealers and distributors authorized to perform the 17 reflashes. 18 The California Trucking Association also 19 participated at the International Truck Show in September 20 to promote the voluntary program and contacted large 21 fleets to inform them of the program. 22 --o0o-- 23 AIR POLLUTION SPECIALIST LANDBERG: The engine 24 manufacturers also conducted some outreach events -- some 25 outreach to promote the voluntary program. Their efforts PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 197 1 included sending letters to their dealers, distributors 2 authorized to perform low NOx software upgrades to inform 3 them of the voluntary program. 4 They also conducted follow-up calls to authorized 5 dealers and distributors to resolve implementation issues 6 that invariably occur with a new program. Also, the 7 engine manufacturers agree to cover the costs of 8 electronic control modules, or ECM, replacement if failure 9 occurred during reflash. 10 --o0o-- 11 AIR POLLUTION SPECIALIST LANDBERG: Several times 12 I've mentioned authorized dealers and distributors. This 13 slide shows the dealers and distributors located in 14 northern California that are authorized to install low NOx 15 software upgrades. Each dot represents an individual 16 dealer. The dots are color-coded to indicate which engine 17 by manufacturer they're authorized to reflash. 18 While for the most part the dealer coverage was 19 adequate, as you will see later in the presentation, the 20 engine manufacturers were not able to generate the 21 sufficient interest in the program among dealers. 22 --o0o-- 23 AIR POLLUTION SPECIALIST LANDBERG: This slide 24 shows the distribution of authorized dealers and 25 distributors located in southern California. A number of PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 198 1 dealers who were authorized to reflash chose not to 2 participate or dropped out of the program, particularly in 3 southern California. 4 --o0o-- 5 AIR POLLUTION SPECIALIST LANDBERG: September 7th 6 was the first reporting date on the voluntary program. At 7 that time, the engine manufacturers were required to 8 report the number of reflashes performed from April 1st 9 through August 31st. As you can see the engine 10 manufacturers report is a total 1,288 engines reflashed 11 during this period. 12 Wee would have expected about 280 reflashes in 13 the absence of a voluntary program. So the voluntary 14 program is having an effect. 15 We also calculated that on average only 1.6 16 reflashes per month are being performed per dealer. 17 --o0o-- 18 AIR POLLUTION SPECIALIST LANDBERG: This graph 19 puts the progress to date into perspective. As of the 20 March 2004 Board Meeting, about 13 percent of the high 21 emitting trucks had already been reflashed. As of the end 22 of August 15 percent have been reflashed an increase of 2 23 percentage points. The target for October 28th is 35 24 percent. 25 I think it is clear that the number of voluntary PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 199 1 reflashes performed so far in this first reporting period 2 is far less than we expected. Our expectation, based on 3 communications between the engine manufacturers and the 4 dealers, was that each affected truck seeking service at a 5 dealership would be reflashed unless the owner refused. 6 Clearly this is not happening. 7 --o0o-- 8 AIR POLLUTION SPECIALIST LANDBERG: This slide 9 shows our estimate of the reflashable engine population 10 for each engine manufacturer and what percent of their 11 engines have been reflashed. The highest reflash 12 percentage is from Detroit Diesel Corporation, or DDC, at 13 26 percent. This percentage is the closest to the first 14 target of 35 percent. Most of DDC's reflashes were done 15 under a nationwide incentive program and not under this 16 program. We should mention that at the start of the 17 voluntary program, DDC had 21 percent of their engines 18 reflashed. 19 --o0o-- 20 AIR POLLUTION SPECIALIST LANDBERG: Engine 21 manufacturers will be sending us more reported reflashes 22 in just a few days. The next reporting deadline is 23 November 1st. The total number of engines reflashed will 24 be used to evaluate if the first target, the 35 percent 25 target, has been met by the voluntary program. Staff will PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 200 1 analyze these data to verify the reflashes are of 2 California registered engines, calculate the emission 3 benefits, and estimate if it is likely the future years' 4 targets can be met. 5 At the December 9th hearing we will present our 6 assessment and look to you for direction on how to 7 proceed. 8 That concludes my presentation. 9 Thank you for your attention. 10 CHAIRPERSON LLOYD: Thank you. 11 Any questions? 12 CHAIRPERSON LLOYD: Mr. Loveridge. 13 BOARD MEMBER LOVERIDGE: Help me out. Let's 14 assume I own a truck that is consent to this time period. 15 What's the cost of this chip reflash? How long would it 16 take me if I had a truck for this to be done? What is the 17 particular incentive? Why would I want to take the cost 18 and the time to do it? 19 AIR POLLUTION SPECIALIST LANDBERG: Well, the 20 cost of the reflash is currently free under the voluntary 21 program for the truck owner/operator. The reflash can 22 take about 15 to 30 minutes. And the incentive would be 23 that if the Regulation was in place, then they may have to 24 pay for the reflash. So right now is the opportunity. 25 BOARD MEMBER LOVERIDGE: Well, what would be the PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 201 1 cost later? 2 AIR POLLUTION SPECIALIST LANDBERG: The costs 3 vary by engine manufacturer. We've seen it about as high 4 as $300 or $400. 5 BOARD MEMBER LOVERIDGE: Thanks. 6 CHAIRPERSON LLOYD: Questions? 7 Thank you very much. 8 With that, I'd like to see if there are any other 9 comments from staff? 10 I'd like to turn now and call up the first 3 11 witnesses. Paul Wuebben, Gretchen Knudsen and Stephanie 12 Williams and Staci Heaton. 13 MR. WUEBBEN: Good afternoon, Mr. Chairman and 14 members of the board. I am Paul Wuebben, the Clean Fuels 15 Officer for the South Coast Air Quality Management 16 District. And I'm here this afternoon on behalf of our 17 executive officer to provide some comment on this 18 voluntary software upgrade program. 19 First and foremost, your staff deserve a 20 tremendous amount of credit for the diligent efforts that 21 they've taken to achieve the optimistic goals of the 22 program. They've done their usually outstanding job in 23 this regard. And we'd also like to acknowledge very 24 publicly that CTA has worked very hard in providing 25 valuable help in program design, outreach, coordination, PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 202 1 et cetera. 2 Now, as you know, engine manufactures have a 3 unique obligation to address their noncompliance with 4 heavy-duty emission standards for over 50,000 trucks that 5 have been equipped with inappropriate defeat devices. 6 These obligations are the result, as you were told, of a 7 legal consent decree entered into with both the justice 8 department and with your board. 9 The excess emissions from these trucks contribute 10 significantly to the nonattainment air burden -- air 11 quality burden in the south coast air basin. 12 The Board has shown great flexibility and 13 patience in attempting to find the most effective path to 14 addressing this problem. You have provided more than 15 ample time to initiate a voluntary program. You've 16 delayed the filing of the adopted regulatory program to 17 implement a mandatory backstop. And you've worked in much 18 good faith with the engine manufacturers despite the less 19 than honorable context of this problem. 20 In other words, no one can accuse you of being 21 heavy handed or premature or insensitive to the concerns 22 of industry or the users. Yet despite your best efforts, 23 we now find ourselves at a juncture which many have 24 anticipated from the beginning, namely that voluntary 25 efforts to address this problem simply fall short as a PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 203 1 means of adequately addressing this problem. 2 There is also the first 5 months since April 1 3 are now in, and from our standpoint, are -- we share your 4 view that they are very disappointing. Of the 5,400 5 trucks -- 54,000 trucks that are subject to this upgrade 6 only 2.4 percent of them have been voluntarily upgraded 7 since that April 1 date. 8 The 35 percent target was supposed to be reached 9 today, October 28th. So waiting an additional 8 weeks for 10 additional data we don't think will result in a miraculous 11 reversal of these numbers. 12 Even the Boston Red Sox could not overcome those 13 odds. 14 EXECUTIVE OFFICER WITHERSPOON: Yes, they could. 15 (Laughter.) 16 MR. WUEBBEN: Okay. 17 So what do we think is at stake today? The Board 18 has already convened a public hearing. You carefully 19 weighed the alternative courses of action and you adopted 20 a mandatory backstop program concurrent with the voluntary 21 program. And at the March hearing you, of course, 22 instructed the Executive Officer to delay the filing of 23 that package with the Office of Administrative Law. 24 So now we have facts that are on the ground that 25 are quite different. So in light of all those facts PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 204 1 today, we urge the Board to direct your staff to 2 immediately file the mandatory regulatory package with the 3 Office of Administrative Law as previously adopted. And 4 we think in doing so that the Board will have a certain 5 knowledge that you're acting today with real 6 deliberateness, and also with a firm sense about the 7 public health imperatives of this whole situation. 8 So with that, we appreciate the opportunity to 9 provide comment and we certainly look forward to our 10 continued support for the many excellent programs of the 11 ARB. 12 CHAIRPERSON LLOYD: Thank you, Paul. 13 Is this your first trip to Fresno in your 14 capacity with the Board? 15 MR. WUEBBEN: Yes and I'm happy to come up. 16 CHAIRPERSON LLOYD: On a serious note, one of the 17 issues that came up and might come up in the staff 18 presentation is cost is an issue. Is South Coast 19 mechanism to maybe try to help the facilitate this, offset 20 some of the costs? 21 MR. WUEBBEN: Well, we haven't looked at that in 22 a formal manner. We do understand that with the costs 23 that were explained that this is a very cost effective 24 program, and that's why, in your wisdom, the Board adopted 25 the backstop program, not assuming some additional PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 205 1 support. But as always we would certainly want to look at 2 whatever opportunities now exist and there may be some 3 additional opportunities, but of course I'm not in the 4 position to do that. 5 CHAIRPERSON LLOYD: No, I understand. Thank you 6 very much. Thank you for your comments. Gretchen 7 Knudsen, Stephanie Williams, Dawn Friest. 8 Gretchen, before you start I must applaud your 9 courage in coming out given the very performance of the 10 company -- the progress you've made. So congratulations 11 on your courage. 12 (Laughter.) 13 MS. KNUDSEN: I appreciate that. 14 (Laughter.) 15 BOARD MEMBER DeSAULNIER: That's the nicest thing 16 you've ever said. 17 (Laughter.) 18 MS. KNUDSEN: Good afternoon. My name is 19 Gretchen Knudsen and I represent the International Truck 20 and Engine Corporation. As you know, International has 21 supported the voluntary program from the start. And we 22 believe that while the program may have gotten off to a 23 slow start, we do believe that it's working. 24 It's important to keep in mind that the numbers 25 before you are preliminary and do not take into account, PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 206 1 at least in the case of International, the previous 2 2 months. With that, I was also notified today that the 3 numbers that you have before you are not reflective of our 4 numbers in the database. Apparently, some of the dealers 5 have been turning in information late, so our August 6 totals are going to increase. 7 I think it's important to note though that in the 8 last 4 months of activity we've reflashed more engines 9 than we have in the past 4 years. And I think that it 10 does show that, while the numbers may not be there and we 11 didn't get off to such a quick start as we'd hoped, it is 12 working. The vehicles are coming in, and the vehicles are 13 being reflashed. 14 International has met its obligations under the 15 settlement agreement. It has also met its obligations 16 under the voluntary program. But we've been trying to 17 take steps to go beyond just dealer notification. In 18 addition to notifying our 25 authorized dealers via phone 19 calls, letters, E-mails, web site alerts, I personally 20 picked up the phone and started calling them as well, we 21 did notify them about the program, we educated them and we 22 got them enthusiastic. 23 I want to just address something that Earl said 24 earlier, we didn't have any dealers, I guess you could 25 say, drop out. In fact, these were authorized dealers PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 207 1 that didn't have -- we don't authorize them to have the 2 reflash program codes. So there were just certain dealers 3 that were not capable and should not be cable of 4 reflashing and hence they were not allowed to participate. 5 In early March though, even before the program 6 was adopted, our IT Department worked over the weekend to 7 pull together a list of 32,000 vehicles to match engine 8 serial numbers with vehicle identification numbers in 9 order to assist staff in identifying reflashable vehicles. 10 In addition, our service team reconfigured its 11 computerized service tool to alert technicians any time a 12 vehicle is brought if it was eligible for reflash, they 13 were notified. 14 We also worked -- we had to modify our engine 15 software upgrade on-line tool so that we can take the tool 16 and use it off site. Where the vehicle -- we want to take 17 it to the fleets where the vehicles are located and that 18 took time to get that off the ground. In addition, we 19 participated in a few planning meetings with CTA. We 20 certainly supported that effort and we encourage the 21 dealers to be involved in that as well. 22 After reviewing the program totals in August, we 23 took a second look to see what could we do going beyond 24 that. And we pulled together a list where we identified 25 the fleets that had the most vehicles. We are currently PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 208 1 in the process of selecting dealers and pulling together 2 service teams to be able to go on site to these fleets and 3 go ahead and reflash them on site in order to encourage 4 reflashes to a current faster rate. 5 For example, we just worked out a deal with San 6 Diego Unified a couple weeks ago to go down and reflash 55 7 of their school buses. This is something going beyond, 8 this is something that International is committed to 9 covering the additional costs of that, the overtime for 10 the service people, the travel time and the additional 11 expense. 12 In addition, we are going to send out additional 13 alerts to our dealers. We are also -- we've developed an 14 ad that will be running in major newspapers throughout 15 California, as well as trade press to try to get out to 16 our customers again, alert them and encourage them to 17 bring their vehicles in. And frankly, these were 2 18 programs effort that we were flatly moving ahead with. 19 The only reason I report these to you today is 20 just because you were receiving an update, we felt that it 21 was important that you be informed of that. 22 The voluntary program is increasing the rate of 23 reflashes. And at least on International's commitment, 24 CTA's and engine manufacturers, we think that the 25 commitment is there. The slow start may be typical of a PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 209 1 large program that involves thousands of customers, 2 hundreds of companies, dealerships and other stakeholders. 3 International's own program launch was delayed. We had to 4 wait for EPA to sign-off on our changes to our dealer 5 notification letters as part of our consent decree and 6 settlement agreement. That took an additional 5 weeks. 7 So at this point we really feel like we've got 8 all the tools in place now, that dealers are alerted, and 9 we've seen an increase in the daily reflash rate since 10 May. And we think that this is obviously a direct result 11 of the voluntary program. So we are committed to this. 12 We are still -- you know, given the date, we're still 13 moving forward with our plans. We're going to try to 14 increase the rates and we really want this program to 15 succeed. We think it has a lot of potential. We think it 16 makes sense for the customers as well as the stakeholders 17 and we hope that it will continue. 18 CHAIRPERSON LLOYD: Thank you. 19 BOARD MEMBER LOVERIDGE: Help me out. What's 20 the -- why do you come down on the side of the voluntary 21 as opposed to a regulatory program? Why is voluntary good 22 and the regulatory program bad? 23 MS. KNUDSEN: I think the reason that we would 24 support the voluntary program, we've talked to the dealers 25 and this is just a logistical concern, we are concerned PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 210 1 that if there are time dates -- a lot of these dealers, 2 they may be an International dealer, they may also service 3 DDC, Cummins, Caterpillar, other engines. And there's 4 real concern there when you look at the numbers they may 5 just not have the capacity to have all of the flood of 6 vehicles coming in all at once. 7 The dealers right now are telling me that there 8 are times during the season they just don't have anywhere 9 to park these vehicles. So we really want to try to get 10 out there to do as much as we can on-site, and to send the 11 service teams out. 12 I think more importantly though, it's the right 13 thing to do for the vehicle owners. It gives them an 14 opportunity to get their vehicles in. It gives them an 15 opportunity to do it for free, and I think, as part of 16 customer service, that's what we need to be doing. 17 So that's why we would be supportive. And I 18 think this is really a unique opportunity for members of 19 industry, the environmental groups, ARB staff and CTA to 20 really pull together and do something that's cooperative 21 and that really does try to get some of these reflashes 22 taken care of. 23 CHAIRPERSON LLOYD: Part of the reason -- part of 24 the reason also Mr. Loveridge when we had the earlier 25 hearing it was very clear from the engine manufacturers PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 211 1 that if we passed a certain Regulation it would lead to 2 certain litigation, at which point there'd be no reflashes 3 going over. So we felt it was worth trying out a 4 voluntary program to see if it would be worth while. 5 Supervisor Patrick. 6 BOARD MEMBER PATRICK: Yes. Now, have the 7 individual owners of these trucks, and school buses and so 8 forth been notified that they're supposed to be doing 9 this? 10 MS. KNUDSEN: We have contacted some of our key 11 customers. And I know that staff has been working very 12 hard to send out letters and notify customers. So we're 13 just doing a second round right now. We're trying to 14 target, for instance, San Diego that has 55 school buses. 15 BOARD MEMBER PATRICK: I guess maybe I'm 16 surprised that they would not step up to the plate. I 17 mean they should have done this during the summer when 18 their buses are not running 5 days a week. 19 MS. KNUDSEN: I think that's where you get into 20 the -- you know, it's up to the individual what makes 21 sense and where the vehicles are, but we were surprised. 22 There were some fleets out there. We thought, for 23 instance, the public fleets that would really make an 24 effort to bring their vehicles in. 25 So I think there's more opportunity to try to PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 212 1 outreach to those particular groups and really encourage 2 them to bring the vehicles in. 3 I'd just like to address something that Dr. Lloyd 4 said earlier. International, at this point, really is 5 pushing to make a voluntary program. And we have not said 6 that we would file a suit. I know that the other engine 7 manufacturers have said so, but that's not been our 8 position to date. 9 BOARD MEMBER PATRICK: I'm just wondering, for 10 example, with public fleets maybe they shouldn't be 11 notifying their fleet operator, and we ought to be 12 notifying the elected officials about this, so that 13 they'll put pressure on people to have this be 14 accomplished. I just don't understand why public fleets 15 would be sitting on their hands about this. 16 MS. KNUDSEN: We would welcome the opportunity to 17 work with the staff and provide them a list of targeted 18 fleets that we would like to bring in. Maybe we can work 19 on that in the next month. 20 CHAIRPERSON LLOYD: Stephanie Williams, Staci 21 Heaton and dawn Friest. 22 MS. HEATON: Good afternoon, Chairman Lloyd and 23 Members of the Board. I want to -- I'm Staci Heaton from 24 the California Trucking Association, CTA's Director of 25 Environmental Affairs. And I want to start out by talking PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 213 1 about our part in the program and what we've done so far. 2 And then I'm going to turn the podium over to Stephanie so 3 that she can talk about where we want to go from here. 4 CTA, at the March 25th board meeting, we did make 5 commitments to this program. And proudly I say that we 6 have stuck with our commitments to this program and worked 7 very hard. We had 3 full-time staff people dedicated to 8 this program, and that's not including myself, and we have 9 done a lot of very hard work on this program over the 10 course of these months. 11 The things that we committed to do included 12 making the outreach pamphlet for the program, which we 13 did. And I don't know if all of you have seen it, I 14 should have brought copies of it. Now, I'm kind of 15 kicking myself. But it had this truck on the front, had 16 all the information inside, the contact information on the 17 back, who the individual truck owners should call if they 18 had questions, this included myself, other members of CTA 19 staff and the ARB staff. 20 This pamphlet was used, not only by CTA staff and 21 ARB staff, it was used by CTA's field representatives. 22 Those were our sales people. We deployed them out to 23 retention visits with our current members and also on 24 sales visits to our potential members. And they educated 25 our reflash as well as our sales calls. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 214 1 We conducted extensive outreach to California 2 truck owners, not just to CTA members but to nonmembers as 3 well. The 3 dedicated full-time staff members that we had 4 spent a good 2 months of their time just making phone 5 calls, and not just to CTA members, but also to 6 non-members as well. 7 The fleets that we contacted ranged from 8 owner/operators with one truck all the way up to the 9 largest fleets in the state. So we contacted a good 10 portion of the truck owners in the state during this 11 process to educate them about reflash, to answer 12 questions. 13 Those staff members also took questions, 14 dedicated a lot of their time to faxing out information to 15 truck owners about where they could take their vehicles to 16 have them reflashed, which engines were reflashable and, 17 you know, all the pertinent information. So we spent a 18 lot of time on that. 19 Earl already discussed our outreach workshops. 20 We conducted outreach workshops, one per month, starting 21 in May. We started in the Sacramento area. We did the 22 San Joaquin area, Bay Area, Central Coast. And then at 23 our International Trucking Show in September we invited 24 our LA/Orange unit members, our San Bernardino/Riverside 25 unit members, as well as the dealers to learn about PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 215 1 reflash. 2 We did a commercial that ran every 15 minutes at 3 our trucking show that directed attendees over to the Air 4 Resources Board booth so that they could learn more about 5 reflash. We did press outreach, and unfortunately our 6 press outreach wasn't very successful because the press 7 really only pays attention to us when they think we're 8 doing something bad, so we didn't get as much press 9 outreach as we had hoped for. 10 BOARD MEMBER DeSAULNIER: Join the club. 11 MS. HEATON: We issue press releases before each 12 one of our events, and unfortunately didn't receive that 13 much press, but we tried. We did extensive outreach at 14 our regular member meetings. Our CTA's geographical units 15 meet every month. And I personally travel throughout the 16 state and spoke at these member meetings. And at these 17 member meetings we had between 20 and 50 truck owners at 18 each meeting that heard about reflash and also received a 19 brochure, a list of reflashable engines and a list of 20 where they could go to have their trucks reflashed. 21 We worked hard to secure some sponsorship money. 22 We were only able to secure 1 sponsorship from 23 ConocoPhillips. We had other interested parties, but they 24 didn't want to get involved under the pending litigation 25 proposals. So we weren't as successful at that as we had PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 216 1 originally hoped. 2 One thing that we didn't commit to but that we 3 thought was a good idea that we did and that was very 4 beneficial to the program was to organize meetings with 5 local authorized engine dealers before each workshop -- 6 outreach workshop in each location. And these meetings 7 were not only educational for us but they were educational 8 for them. There was a lot of shared information. And 9 through these meetings with authorized dealers, we learned 10 about a lot of obstacles that we didn't know were out 11 there when we began the program. 12 So that was our part of the outreach. And some 13 of the issues that came up during these dealer meetings 14 and during the course of the program were, first of all, 15 we had seasonal concerns with our truck owners. March 16 through September/October is the peak season for many 17 trucking companies. There's a driver shortage right now. 18 At the ports where some of -- where a lot of 19 these trucks are located the ports are heavily congested 20 right now. They're having to have four trucks to do the 21 job that one work truck would normally due because trucks 22 can't get in and out of the ports as quickly as they used 23 to. And that's creating a lot of issues with truck owners 24 taking their trucks out of service to get them reflashed. 25 We had the issue of ECM failures arise that we PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 217 1 didn't know existed beforehand, that if an engine is 2 reflashed, and it's not properly done, it can erase the 3 entire electronic control module. We had a couple of 4 these instances during the course of the program. Air 5 Resources Board staff did a great job in negotiating with 6 the OEMs to get these truck owners reimbursed. They were 7 owner/operators, so it was even more important, because 8 they couldn't really afford to lay out $1,500 for a new 9 ECM. So the Air Resources Board staff did a great job at 10 jumping on that and getting that issue resolved. 11 During the first 2 months of the program, we saw 12 a marked lack of education and knowledge among the dealer 13 locations. We were meeting with dealers and inviting them 14 over, and they were telling us that they didn't know about 15 the program, they didn't know they were supposed to be 16 doing it. As the program went on, the education and 17 awareness of the program increased, but it did take a 18 little while for that ramp up. I don't believe the letter 19 from the OEMs got out to the authorized dealers. It took 20 some time. Where CTA jumped right in, you know, not 21 everybody was quite as quick and able to do it as quickly 22 as we were. 23 A few of the issues that came up that have not 24 yet been resolved are the availability of mobile 25 reflashes. We were under the assumption that mobile PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 218 1 reflashes could be done without any problem. We found out 2 that only one manufacturer had made it available to do 3 reflashes mobily. And the authorized dealers were not 4 willing to send technicians out to trucking companies to 5 reflash, because they didn't want to give up their staff 6 that could be working on doing things that are making them 7 more money. 8 We've had a lot of resistance from the -- 9 especially from the independent authorized engine dealers. 10 We find that they don't feel they're being appropriately 11 compensated by all of the OEMs for doing the reflashes. 12 We were under the assumption it would take 15 to 30 13 minutes to do the reflash. And to do the reflash itself 14 it does, but there's paperwork issues involved that take a 15 technician off of doing other things. And then there can 16 also be problems that arise during the reflash that extend 17 the labor time, and they just don't feel they're being 18 properly compensated, particularly in the 4-county south 19 coast air basing, which is where most of the trucks are. 20 We held a dealer meeting at our international 21 trucking show, and all but the one distributor 22 representative that was there told us that they were 23 rerouting those trucks that came in for reflashes to the 24 distributors, and that they weren't doing it, because they 25 were losing money. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 219 1 Obviously, since that's where most of the trucks 2 are, we find that to be a great issue, and something that 3 has not yet been resolved. 4 There have always been issues -- 5 CHAIRPERSON LLOYD: Staci, are you going to give 6 Stephanie a chance to talk? 7 (Laughter.) 8 MS. HEATON: Yes, I am. I promise. I have just 9 a few more things. 10 We had some issues with engine serial numbers 11 coming up as not reflashable. When they would go in to 12 get reflashed, the dealers finding the information that 13 they couldn't be reflashed, and this has not been resolved 14 yet. 15 And finally, password delays. Some of the 16 dealers have been reporting up to 4-hour delays on getting 17 a password, just so that they could log in and download 18 the software so that they can reflash the engine. 19 So these are some of the, we think, pretty large 20 issues that have come up during the process that we were 21 not aware of ahead of time, and that we feel need to be 22 resolved. 23 So with that, if you don't have any questions for 24 me, I'll ask our Senior Vice President, Stephanie Williams 25 to come up and do her part of the presentation. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 220 1 CHAIRPERSON LLOYD: Congratulations on the 2 outreach. Clearly it's a great job. 3 MS. HEATON: We want to see this done as much as 4 you do. 5 MS. WILLIAMS: Staci did a great job. So here we 6 are. I mean it's months past where we expected to be. 7 There's been some large obstacles. And I've talked to 8 some of the dealers and different people that are involved 9 in this. And there's really 2 ways we can go. I don't 10 think the California Trucking Association would oppose 11 Regulation. Our members want to reflash their trucks to 12 follow the process. 13 But it goes to court and there's leaks out there 14 that we'll likely litigate on class action, but they 15 bought these vehicles knowing -- or at least assuming you 16 know, that clean air worthy. And the engine manufacturers 17 have an agreement that's signed by a judge that says this 18 is all that they need to do. 19 So we've committed to this and we want every 20 truck flashed in the shortest amount of time. And I think 21 there's only one way to get this done quickly and that's 22 if we get private funds and give grants to the LA dealers 23 and negotiate the half-hour labor, and that's where we 24 want to move from here. 25 Now, when we went out to get private funds before PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 221 1 and we had quite a number of people that had signed up, I 2 thought I'd raised $100,000. Only $25,000 of it came 3 through, because some of the people I raised money for 4 didn't want to be involved in litigation, and then have 5 their name on a brochure that then goes into a litigation 6 network. So it would be bad press instead of good press. 7 And that's where we got caught up. 8 So we'd like to move forward, at least especially 9 in the LA area in this direction. 10 CHAIRPERSON LLOYD: How much money are you 11 talking about? 12 MS. WILLIAMS: I think if we started with 13 $100,000, and we went to -- LA Freightliner is, at least 14 for my members, that's where everybody gets their trucks. 15 I mean the guy that owns it is the Chair of our LA unit. 16 And they had a unit meeting and talked about some of the 17 problems. They're at capacity. So to take off rebuild 18 and things they make money on to bring these trucks in for 19 a loss, that's a lot to ask somebody to do, and put your 20 business in peril. And we don't want to do that to our 21 dealers. So we want to find a way that makes it work. 22 So if they have the money up front and we 23 negotiate the half-hour labor, EMA can keep their bargain, 24 not EMA but their individual members. They have their 25 half hour -- that period of time that they're paying is a PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 222 1 half hour, some of them, some are paying an hour. What's 2 in question is the half hour of labor. So it's $75. 3 So if we go out with grants and we say here this 4 is for X number of reflashes and we negotiate with these 5 LA dealers, I think that we could pull it together. And 6 in my mind there's -- if it goes to court, there's going 7 to be -- no one's going to do it. 8 You can't imagine for us. I mean here we are, 9 we're calling people. We're asking them to go get their 10 trucks reflashed. And they call back and they say oh, 11 they didn't know. Then we have to call ARB, and ARB has 12 to call the dealer. So there's this huge circle 8 13 happening. It's not as easy as it looks. And the mobile 14 idea, which would have been great for our big fleets, 15 just -- it's not a reality. It's not going to happen. 16 CHAIRPERSON LLOYD: Staff would you comment on 17 this? 18 MS. WILLIAMS: Because there's -- these dealers 19 have a business unit. And there's not that many dealers. 20 And they have to make profits in repairing trucks. And 21 some of these dealers don't sell, they're just repair 22 facilities. 23 So we can't ask them to go out. They have 24 nothing to do with this. The trucking companies bought a 25 truck they thought was fine. The engine manufacturers PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 223 1 have to deal with this and take the risk. The dealers 2 aren't even involved. And I think the trucking companies 3 are closer to the dealers than the engine manufacturers. 4 The engine manufactures have absolutely no leverage over 5 the dealers whatsoever. They can't make them do anything. 6 We'd have these meetings and they'd come in and 7 say no, we're not doing that. So we'd have to go to our 8 big trucking companies and leverage the dealers and that's 9 where the leverage would come in. So we're asking the 10 engine manufacturers to do something impossible. We're 11 asking the trucking companies to attempt to keep trying to 12 get this done, but people are saying no. 13 So we need to find a way to just do it and not 14 have litigation. We need to forget about litigation. We 15 need commit to it. One thing we did learn, and I can't 16 tell you how man times the LA Times calls me every year, 17 this is the one time they just won't write it. I mean 18 this is not newsworthy for some reason. 19 So everything else that we do is in the press. 20 You see our port bills are in the press. Everybody knows 21 what we're doing. It's not newsworthy. So unless we have 22 somebody out there, some movie star or, you know, the 23 Governor, somebody out there with the mission to get the 24 trucks flashed, we need that kind of press, so people will 25 feel like they're motivated to do it. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 224 1 And I think that would help the dealers, too. It 2 became something that was a great thing to do, but until 3 we get that press, especially in the L A region, it's 4 tough. 5 CHAIRPERSON LLOYD: I'll ask staff what -- do you 6 think the money is an obstacle? 7 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Well, 8 it appears clear that the dealers, after the initial 9 problem of getting the message out, this is something that 10 should be done, are still not doing it. And I would guess 11 that the number one issue is the reimbursement rate. 12 So money would solve -- help the problem a lot. 13 But I think the money would be much greater than, you 14 know, what is started. We've got about 40,000 to 50,000 15 trucks that need to be reflashed, and at $100,000, that's 16 a couple bucks a truck. 17 So it seems to me like the incentive if it's 18 taking them a half an hour longer or something has got to 19 be $50 or something that at least reimburses their time, 20 which would start adding up pretty rapidly. 21 So I don't know if Stephanie thinks she can raise 22 that kind of money, but, you know, it's got to be more 23 than -- a million dollars not -- 24 MS. WILLIAMS: I think we can leverage it. 25 Because in northern California, we didn't have this PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 225 1 problem. We convinced them to do it, because we're their 2 customer, and so they did it. 3 In southern California there's more trucks, 4 there's a higher capacity usage of the dealers. So 5 they're going to get a little bit more, but getting money 6 up front, versus getting paid on a warrantee claim 7 individually, there's, you know, part of that up-front 8 grant that's appealing. And, I mean, I was at a meeting 9 and the Freightliner dealer said, "Stephanie, yeah, if you 10 did it that way, there's no problem." 11 So we just need to sit down with them and say 12 okay here's what we're going to do -- and get some 13 sponsors and get some press. 14 CHAIRPERSON LLOYD: Maybe we can have staff work 15 with you on that and maybe work with the South Coast and 16 see what -- 17 MS. WILLIAMS: But there's a hearing coming up in 18 December. We know there's going to be a lot more 19 reflashes. You have to understand we're did not get 20 started until June, because we didn't get the dealer 21 letter out until May. I mean, the dealer letter told 22 dealers that they were actually going to be refunded. 23 So we started in June. And June and July is what 24 you're looking at in the numbers, because we know there's 25 a lot that's been done. We want to commit to the numbers, PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 226 1 and make sure that they're done and be able to come to you 2 in December and say they're done also. 3 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: If I 4 could add one other comment, too, is remember the DMA and 5 their members are partners in this too. They're the ones 6 paying for it. And maybe the question to them is what 7 more can they do? They don't control their dealers, but 8 their dealers, in some instances, are arm of the 9 companies. And so perhaps they can help out. 10 CHAIRPERSON LLOYD: While this is tough 11 Stephanie, it's much easier to work with you than against 12 you. 13 MS. WILLIAMS: There's flip flop on both sides. 14 BOARD MEMBER DeSAULNIER: No flip-flopping. 15 MS. WILLIAMS: You know it was kind of fun being 16 a regular. We were very offended when we saw EMA's 17 letter. Besides ourselves. They asked us well, why 18 didn't you call, because we called the ARB. We thought we 19 were working with them. 20 BOARD MEMBER DeSAULNIER: How did you feel about 21 South Coast's letter? 22 MS. WILLIAMS: The South Coast letter, I haven't 23 seen that. I better read it. But we appreciate working 24 together with you on projects like this. It's good for 25 California. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 227 1 CHAIRPERSON LLOYD: Thank you. Let's hope we can 2 explore further avenues so that we can be successful. 3 And last we have Dawn Friest. 4 MS. FRIEST: Good afternoon. My name is Dawn 5 Friest, and I'm here today representing the Engine 6 Manufacturers Association. As you know, EMA's members are 7 among many stakeholders that are involved in the voluntary 8 program. The voluntary program was adopted and endorsed 9 by the Board on March 25th, 2004. 10 At that time, the Board determined that the early 11 success of the program should be assessed based on 12 information from reflashes performed through October 28th, 13 today. 14 Those results are to be presented at the December 15 board hearing. The results presented today only include 16 information from the early ramp up efforts and do not 17 include any reflashes that have taken place in the last 7 18 weeks. 19 Frankly at the March board hearing we thought 20 that the next time this Board would be talking about NOx 21 reflash would be at the December board hearing. 22 Nevertheless, here we are today talking about very 23 preliminary, sketchy and unanalyzed data. 24 The early results that are available tell us one 25 thing, that the program experienced a slow start. And PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 228 1 you've heard that from the other stakeholders who have 2 spoken already. 3 What the results also told us is that it's 4 complicated to match VIN date and engine serial numbers, 5 and to determine which reflashes should count and for how 6 much. And that has yet to be done. 7 But the results don't offer any insight into what 8 the program will deliver in the future or what has been 9 accomplished most recently. Through no fault of any of 10 the stakeholders, the program took some time to get 11 rolling. Engine manufacturers needed time to identify 12 dealers and explain the voluntary program to them in 13 coordination with ARB staff. Procedures for tracking and 14 reporting reflashes needed to be established. ARB needed 15 time to develop materials to explain the program to 16 truckers in California, and the ARB, CTA and others needed 17 time to develop and then implement a campaign to promote 18 the program. 19 And we appreciate the efforts that those other 20 stakeholders have made and the extra efforts that's been 21 put into promoting the program. 22 Given this, the early results are not surprising. 23 What is surprising is that we're discussing them today, 24 and we're concerned about discussing them today. This is 25 well in advance of the December date that was planned, PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 229 1 that is planned for the initial assessment of the program 2 based on reflashes conducted through the end of October. 3 We feel that the results today are not only 4 incomplete and unrepresentative and potentially misleading 5 and they don't know what they mean in terms of the 6 emission benefits. And clearly success is to be 7 determined by emission benefits. 8 A number of issues need to be resolved in order 9 to facilitate a complete analysis of any data. ARB and 10 manufacturers are working to pin down the total number of 11 California registered vehicles with eligible reflashable 12 engines. ARB is working to provide VIN data that was 13 promised. And there's still some of the data that's 14 missing. And emission benefits associated with the 15 reflashes need to be determined. It's not clear that all 16 reflashes are being counted. 17 Resolution of these issues is needed to allow for 18 meaningful, accurate, representative analysis of the data. 19 Examining the voluntary program at this time without the 20 benefit of a comprehensive analysis of representative data 21 undermines the efforts of all the stakeholders involved 22 and runs the risk of poisoning the well on a positive 23 program prematurely. 24 Engine manufacturers have made a major commitment 25 to the voluntary program and we have delivered on our PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 230 1 commitment. We believe that given time the program can 2 deliver significant emission benefits to the state cost 3 effectively more so than a mandatory program, and set an 4 important precedent for other cooperative programs. We 5 urge the Board to give the Board program time. 6 I'd be pleased to answer your questions. 7 CHAIRPERSON LLOYD: Questions? Dr. Loveridge. 8 BOARD MEMBER LOVERIDGE: How would you declare 9 success with the later numbers? What would be a 10 successful target to be achieved? 11 MS. FRIEST: I think that's up to the Board to 12 decide, but I think -- 13 BOARD MEMBER LOVERIDGE: I'm asking you. What 14 would you see as achieving success? 15 MS. FRIEST: I think that it's a success if we 16 all work together and we make progress. I think the 17 reflashes that -- even the numbers that have been done 18 now, although they don't -- they haven't hit an arbitrary 19 target that was set, they're growing. I think the most 20 important thing that we should focus on today is that the 21 stakeholders involved committed to the program, everybody 22 met their commitments. 23 Even though we got off to a slow start, people 24 are communicating. When issues came up, people worked 25 together. The stakeholders worked together to resolve PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 231 1 those issues. There was some reference to ECM failures. 2 Engine manufacturers paid for those ECM failures. 3 So where things have come up, stakeholders have 4 come together and resolved those issues. And I think that 5 in itself is a success. And I think that the progress -- 6 the numbers are going to grow. There is more momentum in 7 the program now. And the data that you're looking at is a 8 snapshot of a ramp-up effort. 9 BOARD MEMBER LOVERIDGE: And I respect that point 10 that was made. But I just was curious if you look 11 prospectively ahead of what the -- like the range that you 12 consider to be a success. 13 MS. FRIEST: I don't think we have a number in 14 mind. I think that the Board put a number down. And it's 15 not unit volume. I think that's another point to make. 16 It shouldn't be focusing on unit volume. It should be 17 focusing on emission benefits. And if you take a look at 18 the emission benefits that come out of the voluntary 19 program and, you know, at the appropriate time make as 20 assessment as to what emission benefits you'll get if you 21 go to a mandatory program, then that's a valid comparison. 22 But it's not time to do that. 23 CHAIRPERSON LLOYD: So you're comfortable with 24 coming -- staff coming back to the Board in December? 25 MS. FRIEST: I think that's a deadline that the PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 232 1 staff has set, and we're prepared to be here at that time 2 and talk about what the report shows at that time, what 3 the data shows and what it means at that time, after 4 there's an appropriate analysis and more complete data. 5 CHAIRPERSON LLOYD: I know you say maybe not the 6 right parameter, but how confident are you that we'll be 7 fairly close to that 35 percent? 8 MS. FRIEST: I don't have numbers in front of me 9 even covering the reflashes from the last 7 weeks, which 10 have happened, because those numbers haven't been tallied. 11 So, at this point, there's still some issues that we have 12 to resolve with ARB staff about what a specific reflash on 13 a specific engine means in terms of the emission benefit 14 that goes along with that. So I just -- I can't answer 15 that question. 16 CHAIRPERSON LLOYD: What about the comment you 17 made early that you have better leverage on the dealers 18 and the manufacturers number 1. Number 2 is financial 19 reimbursement a significant issue? 20 MS. FRIEST: I think that -- I think that what 21 Stephanie said is that we don't have any leverage over the 22 dealers, and that is accurate. We don't control the 23 dealers. And if she's -- Stephanie is very correct in 24 stating that her members and her organizations have far 25 greater leverage over the dealers than we do. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 233 1 And it's the pockets of dealers. It's not, as 2 Stephanie mentioned, you know -- most of the dealers that 3 would -- we've seen very good results from many of the 4 dealers and a willingness to do this once they understood 5 that, you know, what was going to be reimbursed by the 6 engine manufacturers. 7 Quite frankly this is the first that I've heard 8 today about an unwillingness by certain dealers to do the 9 reflashes. This was news to me. And I contacted Jed and 10 it was also news to him. So, you know, obviously it's an 11 issue that we are going through. 12 CHAIRPERSON LLOYD: Thank you. 13 Thank you for coming up. 14 Seeing no more witnesses, any other comments from 15 staff? 16 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Just 17 that I think the good news is that some reflashes 18 occurred, and if we had adopted the regulation in March, 19 there probably would have been none beyond the normal 20 trend occurring, so we kind of have a small victory here. 21 But I think -- I don't think it can be sugar-coated. We 22 managed to get 2 percentage points worth of engines 23 reflashed, going from 13 to 15 percent and the target is 24 35. 25 So unless things get substantially turned around PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 234 1 in the last -- since September 1, when we got our first 2 bundle of data, it's going to be difficult to expect that 3 the program will meet the target by December. 4 However, not -- outstanding that, I guess we 5 believe we should wait. The data is coming in here in a 6 matter of 2 or 3 days, and we will be able to analyze it 7 not just in terms of truck numbers, but in terms of 8 emissions, which is what the performance standard is. And 9 I think that's -- you know, that's what the Board asked us 10 to do is help them suggest a performance standard. It 11 wasn't -- at least as we understood it, it was not -- the 12 goal was not to try and fail. The goal was to succeed. 13 And that's going to ultimately be determined by the 14 emission reductions that we get, and not by the good 15 efforts that everybody is going to put forward. 16 CHAIRPERSON LLOYD: I Agree with you, Tom. I 17 think it's discouraging the way it's progresses so far. I 18 guess, given what we've heard about the late start and 19 some of the difficulties and some of the suggestions that 20 have come forward, that we can all work together and come 21 up with a much better picture in December. 22 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Well, I 23 hope so. But again not to get your hopes too high, the -- 24 you know, the rate at which these engines are being 25 reflashed at 1.6 per dealer per month is, you know, almost PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 235 1 a factor of 10 lower than what would have been needed for 2 that whole time period. So we have to see a huge 3 increase, which we have found a couple of dealers that are 4 all of a sudden doing that, are talking about having done 5 50 a day and having to work over time. So, you know, 6 there's a possibility that it will increase, but it's a 7 very big uphill challenge at this point. 8 I hope we've better news to report than we are 9 reporting right now. 10 CHAIRPERSON LLOYD: Yes. 11 BOARD MEMBER GONG: Clarification. Since I'm a 12 new member, second meeting -- I'm counting them. 13 (Laughter.) 14 BOARD MEMBER GONG: The voluntary program 15 schedule, that was voted in or agreed to by the Board at 16 their March meeting. So if in December the numbers come 17 in 35 percent, we will smile at each other and say we're 18 somewhat on target and we'll just keep moving with the 19 voluntary program at that point. 20 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: One 21 nuance to that is that we promise to give you two 22 statistics. One is was the 35 percent met. And then in 23 the way that it's being met or the rate at which engines 24 are being reflashed, is there a reasonable probability to 25 that 60 percent can be met. It could be that, for PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 236 1 example, that only school buses got reflashed. That 2 would -- and no line-haul trucks. That would be a recipe 3 for failure at the next level. It's just a hypothetical. 4 But that kind of thing we've offered to assess for you. 5 BOARD MEMBER GONG: And if December comes around 6 and it's less than 35 percent, 25, 20 whatever, then the 7 Board could reconsider the schedule? 8 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Well, 9 the reason why we needed to look at the following goals is 10 because the regulation, when you pass them, only have a 11 life of less than one year before they have to be formally 12 submitted and become law. And if we don't meet that 13 deadline, which I believe is February 6th, then the whole 14 Regulation goes away and you have to start all over. 15 So we picked December in order to give you the 16 opportunity that, should you want to make the Regulation 17 go forward, if the voluntary program is not working, you 18 would tell the executive officer go ahead and file the 19 Regulation between December 6 and February 6 that process 20 could be completed. 21 So that's why we have to look at the likelihood 22 of success of the future goals as well, because once that 23 February 6th date goes by, then we have to start the whole 24 process over again to do the Regulation. 25 CHAIRPERSON LLOYD: Thank you. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 237 1 Supervisor DeSaulnier. 2 BOARD MEMBER DeSAULNIER: Well, I appreciate the 3 report. And from may perspective, as best as I can 4 recollect, since March is a long time for me to remember, 5 Stephanie, you and I had a sidebar with Jed after the 6 hearing. And both because of your public comments and 7 Staci's comments and Jed's comments, I actually thought 8 that this would be more of a celebration. You know, 9 rather than have the threat of litigation, we'd be able to 10 say that we were really moving ahead. And we'd also have 11 a preliminary Koom Ba Ya and say let's get to the final. 12 So the idea that this somehow -- you now, maybe 13 I'm subjective, since I offered it in the first place -- 14 that this would somehow poison the well, I'll have to take 15 that up with the Jed personally since he didn't come here. 16 That was the other reason I suggested this to give him 17 another opportunity to get out of Chicago. 18 (Laughter.) 19 BOARD MEMBER DeSAULNIER: I'm not ready to 20 prejudge what will happen in December. I think we've all 21 come too far to try to avoid litigation. I'm not of a 22 mind that thinks that maybe I'm being naive, that 23 anybody's prejudged that we will be in litigation. I 24 mean, we're relatively -- though we're far apart, maybe 25 this is because I'm a life-time Red Sox fan, and the day PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 238 1 after, but I actually think, as far apart as we are, we 2 still have so much to gain if we can make this work rather 3 than go through litigation, both for each of the 4 constituents who are here today, but for the public health 5 values. 6 So I think it was helpful. I'm disappointed that 7 it's not -- what I thought would happen would be a more 8 positive report. But on the other hand I'm sensitive to 9 the demands that you folks are all under. And maybe we've 10 learned something collectively here that we can sort of 11 push the ball down the field and declare a victory in 12 December. At least that's my hope. 13 So from my perspective, I hope Jed feels that the 14 well hasn't been poisoned and we should keep working it 15 out. 16 CHAIRPERSON LLOYD: Thank you very much. I guess 17 since this is not a regulatory item, it's not necessary to 18 officially closed the record. 19 We'll move on to the last agenda item today, 20 which is the school bus item. The next agenda item is 21 04-9-4 an update on the Implementation of the Airborne 22 Toxic Control Measure to limit school bus idling and 23 idling at schools. 24 The School bus idling Air Toxic Control Measure 25 is just one step in our comprehensive strategy to reduce PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 239 1 public exposure to health risks associated with diesel 2 emissions. This Regulation has been very successful in 3 reducing idling from school buses and other vehicles that 4 operate at or near schools. As a result, children's 5 exposure to diesel exhaust particulate matter (or diesel 6 PM) and other Toxic Air Contaminants and air pollutants 7 has decreased. 8 At this time, I'll turnover it over to Mr. 9 Cackette or Mr. Scheible -- Mr. Cackette to introduce the 10 item and an update from staff on this important measure. 11 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Just 12 let me introduce Ms. Merrin Bueto of the Stationary Source 13 Division who will make the presentation. 14 (Thereupon an overhead presentation was 15 Presented as follows.) 16 MS. BUETO: Thank you, Mr. Cackette. Good 17 afternoon, Chairman Lloyd and Members of the Board. In 18 December 2002, staff presented to the Board the Airborne 19 Toxic Control Measure to limit school bus idling and 20 idling at schools as a first step in carrying out the Air 21 Resources Board diesel exhaust particulate matter risk 22 reduction plan. 23 The Board unanimously approved the Airborne Toxic 24 Control Measure, or ATCM. I am pleased to report back to 25 the Board today on the positive implementation of and PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 240 1 compliance with the measure. 2 --o0o-- 3 MS. BUETO: In today's presentation I will 4 provide the Board with background information on the 5 development of the diesel risk reduction plan and staff's 6 progress in implementing that plan; summarize the specific 7 requirements of the school bus idling ATCM; discuss 8 implementation and outreach; and cover enforcement 9 activities and compliance statistics. 10 --o0o-- 11 MS. BUETO: The public's exposure to toxic air 12 contaminants is a significant public health issue in 13 California. In 1983, the California Legislature 14 established in State law a 2-step process to address the 15 potential health effects from toxic air contaminants. The 16 first step is to identify toxic air contaminants. And the 17 second is to control those contaminants. 18 --o0o-- 19 MS. BUETO: In August 1998, the Board identified 20 Diesel PM as a toxic air contaminant. Diesel PM has been 21 shown through animal and human studies to cause cancer, 22 adverse developmental effects and respiratory reactions. 23 --o0o-- 24 MS. BUETO: The health impacts of diesel PM 25 include increased incidents of lung cancer, chronic PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 241 1 respiratory problems, such as asthma, and cardiovascular 2 disease. Diesel PM contributes about 70 percent of the 3 total potential cancer risk from all toxic air 4 contaminants. 5 --o0o-- 6 MS. BUETO: As this slide shows, there are 7 significant health impacts from diesel PM. Children and 8 the elderly are the most susceptible to the associated 9 health risks. 10 --o0o-- 11 MS. BUETO: Staff estimates there are more than 1 12 million stationary, portable and mobile diesel engines in 13 California. 14 --o0o-- 15 MS. BUETO: In September 2000, the Board approved 16 the diesel risk reduction plan. The plan envisions a 17 sweeping effort to reduce diesel PM emissions from the 18 State's more than 1 million existing diesel engines and to 19 ensure that new diesel engines sold in California are 20 significantly cleaner than they have been in the past. 21 --o0o-- 22 MS. BUETO: Since approving the diesel risk 23 reduction plan, the Board has adopted a number of 24 measures, which are identified in this slide, to reduce 25 harmful air emissions from diesel engines. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 242 1 --o0o-- 2 MS. BUETO: ARB staff will present additional 3 measures to the Board in the future aimed at reducing 4 exposure to diesel PM emissions through the control of 5 existing engines in public fleets, private fleets, cargo 6 craft and ocean vessels to name a few. 7 --o0o-- 8 MS. BUETO: Now I'd like to move on to the ATCM 9 to limit school bus idling and idling at schools. It was 10 adopted by the Board in December of 2002. The ATCM became 11 effective July 15th, 2003 just in time for the fall school 12 year. 13 --o0o-- 14 MS. BUETO: Daily more than 26,000 school buses 15 and numerous other buses and heavy-duty vehicles operate 16 at or near schools. The ATCM limits school bus idling and 17 idling at public and private schools, grades kindergarten 18 through 12, to only when necessary for safety or 19 operational concerns. 20 Regardless of fuel type, the Regulation applies 21 to school transportation, including school buses, school 22 pupil activity buses and youth buses, and general public 23 para-transit vehicles and to transit buses and heavy-duty 24 vehicles operating at or near schools. 25 --o0o-- PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 243 1 MS. BUETO: The ATCM requires the driver of any 2 school transportation vehicle to turn off the engine upon 3 arriving at a school or when within 100 feet of a school 4 and restart their engine no more than 30 seconds before 5 departing. 6 At locations beyond 100 feet such as at bus stops 7 or school activity destinations, drivers are not allowed 8 to idle for more than 5 consecutive minutes at each stop. 9 --o0o-- 10 MS. BUETO: The ATCM also requires drivers of 11 other vehicles to limit their idling. Just like school 12 buses, transit buses and heavy-duty vehicles are required 13 to turn the engine off upon arriving at a school, and 14 restart no more than 30 seconds before departure. 15 However, when within 100 feet of a school, these 16 vehicles may idle, but not for more than 5 minutes. In 17 July of this year, the Board approved a Regulation that 18 essentially extends the 5-minute idling limitation to all 19 commercial heavy-duty diesel fueled vehicles greater than 20 10,000 pounds at all locations statewide. That new 21 Regulation will become effective in the 2005. 22 --o0o-- 23 MS. BUETO: The ATCM also establishes training 24 and record keeping requirements to ensure drivers and 25 employers are familiar with the regulation requirements. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 244 1 --o0o-- 2 MS. BUETO: As part of the implementation 3 process, staff's outreach activities have involved 4 interaction with a variety of government agencies, 5 industry, organizations, environmental groups, and other 6 interested parties. A web site with list-serve capability 7 to over 5,000 subscribers was developed and regularly 8 updated to provide information about the ATCM, its status, 9 and whom to contact for additional information. 10 In addition, the ARB's internet site for kids, 11 "The Know Zone", was expanded to provide students and 12 teachers with information about the ATCM in a more age 13 appropriate format. Staff also prepared several articles 14 and brochures that were used in newsletters, trade 15 magazines and other forms of publication. 16 --o0o-- 17 MS. BUETO: Staff developed and distributed 18 educational materials to over 1,000 school districts and 19 4,000 private schools. The school districts and private 20 schools were encouraged to reproduce and distribute the 21 educational materials to school officials, drivers, 22 parents and to companies with commercial vehicles that 23 conduct business with their schools. 24 --o0o-- 25 MS. BUETO: Staff also developed educational PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 245 1 materials including a fact sheet and enforcement advisory 2 for owners and operators of affected transit buses and 3 school activity buses, such as charter buses. These 4 owners and operators have incorporated these materials in 5 existing procedures to inform and keep records on drivers. 6 --o0o-- 7 MS. BUETO: To ensure school bus drivers were 8 aware of the requirements, staff worked with the 9 California Department of Education and the California 10 Highway Patrol to incorporate the ATCM's requirements into 11 existing required training, testing and record keeping 12 programs. 13 School bus drivers are required by the Department 14 of Education to receive initial and annual driver's 15 training. ARB staff worked with the Department of 16 Education to incorporate the new idling limits into the 17 curriculum for school bus drivers. The Department of 18 Education began using it last fall. 19 The California Highway Patrol, which tests and 20 certifies school bus drivers, has included, as of 21 September of this year, questions about the ATCM's 22 requirements in driver exams. In addition, the 23 enforcement division has incorporated information about 24 the ATCM into the tampering detection course that is 25 offered to peace officers. The course reaches nearly 500 PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 246 1 peace officers a year. 2 --o0o-- 3 MS. BUETO: Staff has been conducting extensive 4 training to ensure awareness and compliance with the ATCM. 5 In-service training sessions and presentations have been 6 provided for school bus drivers at the request of 7 California school transportation official chapters and 8 driver trainers. 9 These types of training provide school bus 10 drivers with the opportunity to revisit the ATCM's 11 requirements, and then ass ask questions about situations 12 they are uncertain whether or not the ATCM applies. 13 Staff has also been visiting individual school 14 districts and transportation offices to directly speak 15 with personnel, including bus driver trainers and 16 supervisors. 17 In addition, the enforcement division is in the 18 process of conducting a statewide survey to verify if a 19 school district have the ATCM requirements in place. At 20 this time, 97 percent of the school districts surveyed 21 have responded that they are aware of the ATCM and had the 22 requirements in place. 23 --o0o-- 24 MS. BUETO: In addition to ARB's efforts for 25 outreach, several of the local air districts have also PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 247 1 mailed notifications to the public and private school 2 district transportation and administration departments, 3 transit operators and bus leasing operators. 4 Other states, such as Arizona and New Jersey and 5 the City of Philadelphia have developed anti-idling 6 regulations that are modeled after the school bus idling 7 ATCM. 8 --o0o-- 9 MS. BUETO: Now, I will briefly discuss the 10 enforcement of and compliance with the ATCM the. ARB is 11 the primary enforcement agency, but the California Highway 12 Patrol, air districts and local peace officers may also 13 enforce the regulation. Any driver that does not comply 14 with the Regulation is subject to penalties under the 15 Health and Safety or Vehicle codes. 16 As an ongoing effort to ensure compliance with 17 the ATCM, the Enforcement Division tracks complaints and 18 conducts on-site inspections. Complains are tracked 19 through the 1-800-ENDSMOG complaint line, which was 20 expanded to register complaints about excessive bus or 21 vehicle idling at or near schools and a new on-line 22 complaint form. 23 As of this week, a total of 10 complaints have 24 been received and followed up on by Enforcement Division 25 staff. In response to the Board's direction, the PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 248 1 Enforcement Division conducts spot inspections to 2 determine compliance rates. Inspectors have witnessed 3 more than 300 school buses at drop-off and loading sites 4 throughout the State to ensure proper compliance with the 5 ATCM. 6 Inspectors, while on school premises, also watch 7 for delivery vehicles and other vehicles subject to the 8 ATCM to ensure they are also in compliance. At this time 9 no violations have been issued. 10 --o0o-- 11 MS. BUETO: Based on staff's outreach and 12 enforcement activities, minimal complaints have been 13 received and a high compliance rate was found during 14 on-site spot inspection. 15 --o0o-- 16 MS. BUETO: In summary, staff conducted extensive 17 outreach to ensure the requirements of the ATCM were 18 widely broadcast. The compliance statistics show that 19 affected drivers are conforming to the requirements of the 20 ATCM. As such, children's and other's exposure and 21 associated potential cancer risk and other adverse health 22 effects due to diesel PM and other toxic air contaminants 23 has been reduced. 24 We will continue to monitor the implementation of 25 the ATCM and to track compliance to ensure the continued PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 249 1 success of the program. That concludes my presentation. 2 Thank you Chairman Lloyd and Members of the Board. 3 CHAIRPERSON LLOYD: Thank you very much. 4 Questions? 5 Dr. Loveridge. 6 BOARD MEMBER LOVERIDGE: Kudos. I thought it was 7 detailed, informed report. It looks like it has been 8 effectively -- the story has been told. I thought it was 9 well done. 10 CHAIRPERSON LLOYD: Dr. Gong. 11 BOARD MEMBER GONG: I just wanted to know this 12 applies to both private and public schools? 13 Your answer is yes. 14 CHAIRPERSON LLOYD: If there's a violation who's 15 responsible for the fine, is it the owner of the owner of 16 the vehicle or the driver personally? 17 REGULATORY ASSISTANCE MANAGER WERNER: It would 18 be the driver personally or -- yeah, the record keeping 19 requirements would be the employer, but the driver would 20 be also responsible for the violation. 21 CHAIRPERSON LLOYD: Thank you very much indeed. 22 Again, since this is not a regulatory item, it's not 23 necessary to officially close the record. 24 Any public comments? 25 No public comments? PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 250 1 BOARD CLERK ANDREONI: No. 2 CHAIRPERSON LLOYD: With that, I'd like to 3 officially bring the October 28th meeting of the Air 4 Resources Board to a close -- not to a close, to adjourn 5 it until tomorrow when we will restart at 9:00 a.m. in 6 Sacramento at CalEPA, 1001 I Street. 7 See you all then. 8 Drive safely. 9 (Thereupon the California Air Resources 10 Board meeting recessed at 3:30 p.m. until 11 Friday, October 29, 2004 at 9:00 a.m.) 12 13 14 15 16 17 18 19 20 21 22 23 24 25 PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 251 1 CERTIFICATE OF REPORTER 2 I, JAMES F. PETERS, a Certified Shorthand 3 Reporter of the State of California, and Registered 4 Professional Reporter, do hereby certify: 5 That I am a disinterested person herein; that the 6 foregoing California Air Resources Board meeting was 7 reported in shorthand by me, James F. Peters, a Certified 8 Shorthand Reporter of the State of California, and 9 thereafter transcribed into typewriting. 10 I further certify that I am not of counsel or 11 attorney for any of the parties to said meeting nor in any 12 way interested in the outcome of said meeting. 13 IN WITNESS WHEREOF, I have hereunto set my hand 14 this 11th day of November, 2004. 15 16 17 18 19 20 21 22 JAMES F. PETERS, CSR, RPR 23 Certified Shorthand Reporter 24 License No. 10063 25 PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345