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PROPOSAL:

Amend Rule 2202 – On-Road Motor Vehicle Mitigation Options and Implementation Guidelines

SYNOPSIS:

The proposed amendments will modify existing Rule 2202 to be consistent with amended Health & Safety Code Section 40458 effective June 19, 1998, and repealed Section 44243.5 (SB 432 (Lewis)). The law directs the AQMD to raise the employer applicability threshold for Rule 2202 compliance from 100 to 250, thus permanently exempting worksites with 100 to 249 employees. Rule 2202 Implementation Guidelines will be updated in order to reflect current legal requirements and policy and practice.

COMMITTEE:

Mobile Source, September 25, 1998

RECOMMENDED ACTION:

1. Amend Rule 2202 - On-Road Motor Vehicle Mitigation Options;

2. Amend Rule 2202 On-Road Motor Vehicle Mitigation Option Guidelines;

3. Certify the attached Notice of Exemption prepared for Proposed Amended Rule 2202 – On-Road Motor Vehicle Mitigation Options, in accordance with the attached Resolution.

Barry R. Wallerstein, D.Env.
Acting Executive Officer

Background

In December 1987, the Board adopted Regulation XV requiring trip reduction plans for larger employers, which over time was reduced to worksites with 100 or more employees. On April 14, 1995, the Board adopted Rules 1501 - Work Trip Reduction Plans and 1501.1 - Alternatives to Work Trip Reduction Plans to provide greater flexibility while still complying with federal and state requirements for extreme non-attainment areas. Subsequently, on December 8, 1995, in response to state legislation prohibiting the mandatory submittal of trip reduction plans, the Board adopted Rule 2202 as a replacement rule that did not mandate trip reduction plan submittals, yet allowed the AQMD to remain in compliance with federal and state Clean Air Act requirements.

On November 8, 1996, in response to Health & Safety Code Sections 40458 and 44243.5, (SB 836 Lewis), Rule 2202 was amended to temporarily exempt approximately 2,800 employer worksites with 100-249 employees from the requirements of the rule effective January 1, 1997. SB 836 required that studies be conducted to determine if voluntary ridesharing and other replacement measures would be able to achieve equivalent emission reductions to those achievable under Rule 2202. The bill further mandated that if the emission reductions were not attained, the threshold would return to 100 and those employer worksites would again be subject to Rule 2202 by June 1, 1998. If the emission reductions were attained, the compliance threshold of Rule 2202 would increase to 500 by June 1, 1998.

Studies were conducted to determine the effectiveness of voluntary ridesharing. The findings of the studies indicated that voluntary ridesharing failed to meet emission reduction equivalency. Since equivalency was not attained, the deregulated worksites should have been brought back under Rule 2202, as required by SB 836. Subsequently however, the legislature passed Senate Bill 432 (Lewis) which was then signed into law by Governor Wilson on June 19, 1998. SB 432 amended Health & Safety Code Section 40458 and repealed Section 44243.5. The new law directs AQMD to raise the employer applicability threshold for Rule 2202 compliance from 100 to 250, thus permanently exempting worksites with 100 to 249 employees.

Proposal

The amendment to Rule 2202 proposes to raise the applicability threshold from 100 to 250, thus exempting worksites with 100 to 249 employees. Also proposed is the update of Rule 2202 Implementation Guidelines and Employee Commute Reduction Program Guidelines to be consistent with Health & Safety Codes 40458 & 44243.5, and to reflect or modify current policy and practice.

A summary of proposed rule changes follows:

• Employee Threshold
  Change from 100 to 250

• SB 836 (Lewis)
  Delete all references, since bill’s requirements have been superceded

• Sunset Provision
  Change language from December 31, 1998 rescind date (if equivalent measure adopted) to rescind upon availability of an equivalent replacement measure

• Fee Requirements
  Delete reference to prior Rule 306-Plan Fees, and incorporate reference to Rules 308-On-Road Motor Vehicle Mitigation Option Fees and 311-Air Quality Investment Program Fees

• References to Guidelines
  Change Guidelines references from the December 8, 1995 adoption date to amendment date of October 9, 1998

A summary of the proposed Implementation Guidelines changes follows:

• Emission Reduction Strategies
  Summarized to be consistent with Regulation XVI

• Air Quality Investment
  Specific fee amount removed and replaced with a reference to Rule 311-Air Quality Investment Program Fees

• Example Programs
  Deleted

• Emission Reductions
  Clarification of "real reductions" and record-keeping requirements

• Glossary
  Clarified/modified to be consistent with ECRP Guidelines

• County and Site Specific Emission Factors Deleted
  Will be available upon request

A summary of proposed Employee Commute Reduction Program (ECRP) guidelines changes follows:

• Employee Threshold
  Change from 100 to 250

• Definition Changes/Clarification:
  Aggregate AVR
  Centralized Rideshare Service Center
  Employee Transportation Coordinator
  High AVR No-Fault Inspection
  Flexible Fuels
  Good Faith Effort
  Student Employee

• Permanent Due Date Change
  Considered an extension of time and subject to extension fee

• Geographic Programs
  Deleted as compliance option

• Annual Registration
  Change all references to "Annual Analysis"

AQMP and Legal Mandates

The baseline for the 1997 Air Quality Management Plan (AQMP) and the State Implementation Plan (SIP) includes emission reductions for Rule 2202 and its predecessors, Rules1501 and 1501.1. Due to the passage of SB 836 which exempts employers with worksites of 100-249 employees, Rule 2202 fell short of the emission reduction credits claimed in the 1997 AQMP and the SIP. The resulting shortfall for 1997 was offset by surplus emission reductions from the Rule 2202 Air Quality Investment Program. Likewise, the emission reduction shortfall that will occur during 1998 as a result of SB 432 must also be offset through other emission reduction measures in order for the District to remain in compliance with State and Federal Clean Air Acts.

Emission Impacts

After passage of SB 836, voluntary efforts to reduce emissions by exempted employers fell short of obtaining the emission reductions expected under Rule 2202. Thus, SB 836 led to the following emission reduction shortfall (tons per day) in 1997:

The recent passage of SB 432 has made the exemptions of smaller employers permanent, therefore a shortfall in emission reductions is expected to occur in 1998 as well. While the magnitude of the 1998 shortfall is uncertain at this time, a study will be conducted to ascertain the size of the shortfall and its changes over time. This type of analysis calls for collecting information from deregulated employers to determine whether any changes in the travel behavior of their employees, or in the use of emission reduction strategies at their work sites, has taken place since 1997. The data collection is expected to be completed by mid-November and the results of the study will become available in January 1999.

On September 3, 1998 AQMD staff convened a Rule 2202 Emissions Equivalency Task Force. The Task Force, comprised of representatives from government agencies, employers, community groups and other interested parties, is charged with the task of identifying strategies to offset the shortfall in emission reductions from 1998 and beyond. Proposed strategies/programs identified by this Task Force may result in more cost-effective emission reduction options that expand the scope of existing compliance options offered under Rule 2202. The Task Force efforts may also result in a recommended Rule 2202 replacement measure which produces an equivalent level of emission reductions that are real, quantifiable and surplus relative to the most recently adopted SIP.

CEQA & Socioeconomic Impacts

The AQMD has reviewed the proposed amendments pursuant to California Environmental Quality Act (CEQA) Guidelines §15002(k)(1), the first step of a three-step process for deciding which document to prepare for a project subject to CEQA. The proposed amendments are exempt from CEQA for two reasons. First, the AQMD has no discretion regarding the portion of the proposed amendments which codifies the requirements of Health & Safety Code Sections 40458 and 44243.5 (SB 432, Lewis). As a result, this portion of project approval is a ministerial action and thus is exempt from the requirements of CEQA pursuant to Public Resources Code §21080(b)(1). Second, the remaining portion of the proposed amendments (e.g., deletion of obsolete language, streamlining redundant text, etc.) is strictly administrative. Since it can be seen with certainty that this portion of the proposed amendments has no potential to generate significant adverse environmental impacts, it is exempt from CEQA pursuant to state CEQA Guidelines §15061(b)(3) - Review for Exemption.

A Notice of Exemption has been prepared pursuant to state CEQA Guidelines §15062 - Notice of Exemption. The Notice of Exemption will be filed with the county clerks of Los Angeles, Orange, Riverside and San Bernardino counties immediately following the adoption of the proposed amendments.

The proposed amendments formally exempt those worksites between 100 and 250 employees from compliance with Rule 2202. To date, there are approximately 2,845 worksites in this size category. The following industries are those most affected by the exemption in the proposed amendments (percentages indicate an industry’s share of all workplaces exempted): manufacturing (24.9 percent), services (22.8 percent), wholesale and retail trade (18.8 percent), and transportation and public utilities (11.9 percent). The worksites exempted in the proposed amendments are not currently subject to Rule 2202. Therefore, there will be no socioeconomic impacts of the proposed amendments.

Rule Adoption Relative to the Cost-Effectiveness Schedule

On October 14, 1994, the Governing Board adopted a resolution that requires staff to address whether proposed rules being considered for adoption are being presented in rank order by cost-effectiveness. The 1997 AQMP ranks, in order of cost-effectiveness, all of the proposed control measures for which costs were quantified. The proposed amendments to Rule 2202 are not part of the 1997 AQMP, but, rather, are being proposed to make Rule 2202 consistent with SB 432. Consideration in the order of cost-effectiveness is, therefore, not applicable.

Incremental Cost-Effectiveness

Health and Safety Code Section 40920.6 requires an incremental cost-effectiveness analysis when there is more than one control option which would achieve the emission reduction objective of the proposed amendments, relative to ozone, CO, SOx, NOx, and their precursors. Since the proposed amendments to Rule 2202 do not result in emission reductions, the incremental cost-effectiveness analysis requirement does not apply here.

Implementation Plan

Pursuant to Health & Safety Codes 40458 & 44243.5, the applicability threshold of 250 was effective immediately upon passage by the California legislature on June 19, 1998. The administrative changes to Rule 2202 as well as the amendments to the Guidelines will be effective immediately upon adoption of Rule 2202 by the AQMD Governing Board.

Resource and Fiscal Impacts

The permanent exemption of employer worksites with less than 250 employees or elimination of fees levied on these employers will continue to result in an annual loss of approximately $1.2 million in employer fee revenues. Under current State Law, (SB 432-Lewis), the District is no longer required to appropriate $1.5 million annually to the Regional Transportation Agencies Coalition (RTAC) to promote voluntary ridesharing in the basin.

Attachments

A. Summary of Proposed Rule and Guideline Amendments
B. Issues, Comments and Responses
C. Rule Development Process
D. Key Contacts List
E. SB 836 and SB 432
F. Resolution
G. Notice of Exemption
H. Rule Language
I. Implementation Guidelines
J. Employee Commute Reduction Program (ECRP) Guidelines

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