BOARD MEETING DATE: June 1, 2007
AGENDA NO. 37

PROPOSAL:

Adopt 2007 Air Quality Management Plan for South Coast Air Quality Management District and Certify the Final Program Environmental Impact Report

SYNOPSIS:

On October 10, 2006, staff released the Draft 2007 Air Quality Management Plan (AQMP) to satisfy both federal and state Clean Air Act requirements, address the attainment demonstration requirements of the federal Clean Air Act for 8-hour ozone and PM2.5, and establish transportation emission budgets based on the latest approved motor vehicle emissions model and planning assumptions. The proposed modifications to the Draft 2007 AQMP were released on March 2, 2007 to incorporate revisions to the emissions inventory, modeling, attainment demonstration, and transportation budgets. The Draft Program Environmental Impact Report (PEIR) was also released for public review on March 2, 2007. The Draft Socioeconomic Report was released for review on April 27, 2007. Regional public hearings were held on April 17 through April 19, 2007 throughout the four counties to receive additional public testimony on the 2007 AQMP. A Final PEIR incorporating comments received has also been prepared for the Board’s consideration.

COMMITTEE:

Mobile Source and Stationary Source, Reviewed
January 26, 2007, February 23, 2007, May 25, 2007

RECOMMENDED ACTION:

1. Authorize the Executive Officer to make appropriate changes to the 2007 AQMP and its appendices (if necessary) to reflect policies adopted at the Public Hearing;
2. Certify the Final Program Environmental Impact Report for the 2007 Air Quality Management Plan, in accordance with the attached Resolution (Attachment A);
3.  Adopt the 2007 Air Quality Management Plan in accordance with the attached Resolution; and
4. Direct the Executive Officer to forward the adopted 2007 Air Quality Management Plan to the California Air Resources Board for its approval and subsequent submittal to the U.S. Environmental Protection Agency.

Barry R. Wallerstein, D.Env.
Executive Officer

Background

The U.S. EPA promulgated the federal 8-hour ozone and PM2.5 standards in July 1997 which became effective in June 2004 and April 2005, respectively. For the 8-hour ozone standard, the South Coast Air Basin is classified as a “Severe 17” non-attainment area with an attainment date of June 2021, while the portion of the Salton Sea Air Basin under the District’s jurisdiction (Coachella Valley) is classified as “Serious”, with an attainment date of June 2013. As discussed below, District staff recommends requesting a “bump up” to “extreme” and “severe 15” respectively for these areas. Unlike the 8-hour ozone standard, area designations for the PM2.5 standard did not have a classification system (e.g., serious, severe) and these areas were designated as attainment, non-attainment, or unclassifiable. Accordingly, the Basin and the Coachella Valley were designated non-attainment and unclassifiable for PM2.5, respectively. The initial PM2.5 attainment date for areas such as the Basin is April 2010, however, a 5-year extension is allowed under the provisions of the federal Clean Air Act.

The purpose of the 2007 AQMP is to set forth a comprehensive program that will lead the Basin and Coachella Valley into compliance with all federal and state air quality planning requirements. Specifically, the 2007 AQMP revision is designed to satisfy: the SIP submittal requirements of the federal CAA to demonstrate attainment of the new 8-hour ozone and PM2.5 ambient air quality standards, the California CAA triennial update requirements, and fulfill the District’s obligation to update transportation emission budgets based on the latest approved motor vehicle emissions model and planning assumptions. Unclassifiable regions for PM2.5, such as the Coachella Valley Planning Area, do not require a planning demonstration for the federal standard and are not addressed in this document.

Public Process

Prior to releasing the Draft 2007 AQMP in October 2006, the AQMD conducted an Air Quality Summit in June 2006 with the participation of over 125 attendees including representatives from federal, state, and local governments, academia, and industry experts from a variety of areas and the public, to solicit new and innovative concepts to assist in designing a plan for attaining the ambient air quality standards. In total, District staff received about 200 control measure suggestions. In addition, beginning in 2006 the AQMD held a series of Technical Forums and Technical Roundtable discussions where air quality experts came together and discussed the best overall approach for the AQMP. Topics included emission trends, regional growth patterns, and discussion of the weekend effect.

Since December 2005, the AQMD staff has been working on the development of the 2007 AQMP with two Board advisory committees: the Air Quality Management Plan, and the Scientific, Technical, and Modeling Peer Review Advisory Committee. Since the process began, the AQMD has held 16 meetings for each committee where staff has solicited input and recommendations from committee members. In addition, AQMD staff has conducted a 5-member peer review on the modeling methodology and solicited consultant reviews on the updated emission inventory methodology and control strategies for their technical feasibility.

The Draft 2007 AQMP was released on October 10, 2006 in order to inform the public and other stakeholders of the challenges we face and begin the debate early so that the issues on the development of the 2007 AQMP can be adequately addressed.

Subsequent to the release of the Draft 2007 AQMP, nine public workshops were held throughout the four counties from October 24 through December 6, 2006 to discuss the Draft 2007 AQMP and solicit public input. In addition, an extensive outreach program was conducted including meetings such as city council and council of governments (COG) meetings. In all, over 100 meetings were conducted in which the 2007 AQMP was presented or discussed.

Based on comments received, revisions to the Draft 2007 AQMP were made and are contained in the Proposed Modifications to the Draft 2007 AQMP which was released for public review on March 2, 2007. An additional four public workshops on the Proposed Modifications to the Draft 2007 AQMP were held in March 2007. Five regional public hearings were held in April 2007 in each of the four counties, where additional public input and comments were solicited. As a result of this additional public process, an Addendum to the Proposed Modifications to the Draft 2007 AQMP was prepared and is being submitted to the Board for its consideration.

Proposal

The 2007 AQMP incorporates the most recent planning assumptions and the best available information such as: revised stationary point and area source emissions inventories; on-road and off-road mobile source emissions inventories based on CARB’s latest EMFAC2007 and Off-Road Models, respectively; the use of new meteorological episodes for ozone and expanded air quality modeling analysis; and the latest demographic growth forecasts based on the modified 2004 Regional Transportation Plan (RTP) developed by the Southern California Association of Governments (SCAG). The Plan also includes control strategies for demonstrating attainment with the federal air quality standards for 8-hour ozone and annual PM2.5; and provides a basis for a CO and NO₂ maintenance plan.

Draft 2007 AQMP

At the time of the Draft 2007 AQMP release, CARB had not released their state strategy and the emission inventory and modeling analysis had not been finalized. As a result, the Draft 2007 AQMP contained preliminary on-road and off-road emissions inventories based on a working draft of CARB’s EMFAC2007 on-road model and a draft version of CARB’s OFFROAD model. Because CARB had not completed their state strategy the Draft 2007 AQMP contained state control concepts rather then specific control measures. For attainment demonstration purposes, the AQMD staff included adjusted control measures for state and federal sources as part of the Draft 2007 AQMP.

Proposed Modifications to the Draft 2007 AQMP

Based on the comments received and additional analysis, the Proposed Modifications to the Draft 2007 AQMP were released on March 2, 2007. The Proposed Modifications to the Draft 2007 AQMP included updated emission inventories which incorporated CARB’s latest on-road model EMFAC2007 (v2.3) and OFFROAD model. The use of these models resulted in an overall decrease in future emissions and changes to the attainment demonstration. The modifications document also included CARB’s draft state strategy, as well as the AQMD’s suggested proposed policy options to supplement CARB’s control strategy.

Draft Final 2007 AQMP

The Draft Final 2007 AQMP represents additional revisions to the Plan. The major revisions include: 1) The defined PM2.5 attainment strategy incorporated two enhanced measures for directly emitted PM2.5 proposed by AQMD, two transportation measures submitted by SCAG, and additional NOx reduction commitments to be assumed by CARB; 2) CARB’s revised draft short-term mobile source and consumer products measures were incorporated; 3) The Transportation Conformity Budgets section relative to the ozone conformity determination was expanded to match the years specified in the Reasonable Further Progress (RFP) demonstration; 4) Additional clarifications were provided in several AQMD control measures; and 5) Other minor revisions were also made throughout the AQMP chapters and appendices. A list of the documents contained in the Draft Final 2007 AQMP is provided as Attachment B to this Board letter.

Key Findings

Some of the key findings and highlights of the 2007 AQMP include:

1) Air Quality Trend - Although the long-term trend of air quality in the Basin has improved significantly and is expected to continue to improve because of existing air quality regulations, without additional controls the federal annual PM2.5 and 8-hour standards will not be achieved by 2015 and 2021, respectively;

2) Emissions Inventory - The estimated emissions inventory from mobile sources while continuing to decline over previous years, is projected to make up an overwhelming majority of the PM2.5 and ozone problems in out years (i.e., 73% in 2014). Significant additional reductions are required from these sources in order to demonstrate attainment with the federal standards;

3) Bump-up - The District is requesting that CARB formally submit a request to EPA for voluntary redesignation (bump-up) of the South Coast Air Basin from a designation of “severe-17” to “extreme” for 8-hour average ozone and modify the attainment date to June 15, 2024. In addition, the District is also requesting a bump up for the Coachella Valley from “serious” to “severe-15” and modify the attainment date to June 15, 2019. The reclassifications will enable the use of “black box” control measures for the South Coast Air Basin to ensure that the 8-hour ozone attainment is demonstrated and to alleviate the risk of potential federal sanctions;

4) PM2.5 SIP Submission – In order to design the most efficient path to clean air with clear regulatory commitments for the immediate future, the AQMD is submitting an integrated plan including both PM2.5 and ozone components to be forwarded to U.S. EPA. In addition, the AQMD is requesting a five-year extension from 2010 to 2015 to demonstrate attainment with the annual PM2.5 standard;

5) Attainment Demonstration - Based on the modeling analysis, the 2014 annual PM2.5 standard carrying capacities were determined to be 469 tons per day of VOC and 454 tons per day of NOx emissions requiring significant reductions (59 tons/day of VOC and 192 tons/day of NOx). The 2023 carrying capacities for the 8-hour ozone standard are 420 tons per day of VOC and 114 tons per day of NOx emissions requiring significant reductions (116 tons/day of VOC and 383 tons/day of NOx, including the controls required for the annual PM2.5 standard); and

6) Control Strategy - The overall control strategy proposed in the Plan will provide for attainment of the annual PM2.5 and 8-hour ozone standards by 2015 and 2024, respectively. After implementation of short-term and defined control measures proposed by the AQMD, CARB, and SCAG, 41 tons per day of additional NOx reductions would still need to be achieved in order to meet the annual PM2.5 standard by 2014. To close this gap, the AQMD staff is proposing that CARB commit to additional NOx reductions from mobile sources (Refer to District Staff’s Proposed PM2.5 Attainment Strategy under the Key Policy Issues section). Also, the 2023 deadline for achieving the necessary reductions for meeting the 8-hour ozone standard will require long-term strategies based on future technology advancements, greater implementation of innovative strategies, and additional public funding referred to as “black box” reductions (i.e., 29 tons/day of VOC and 188 tons/day of NOx).

Public Comments

Numerous comments have been received during the Plan development. The specific responses to over 40 written comment letters on the Draft 2007 AQMP as well as oral comments received at the workshops are addressed in the document, "Response to Comments on the Draft 2007 Air Quality Management Plan," dated February 2007. The comments were generally centered around a few control measures such as EGM-01 – Emission Reductions from New or Redevelopment Projects strongly opposing mitigation fees, CMB-04 – Natural Gas Fuel Specifications commenting that the AQMD lack lacked legal authority to regulate natural gas and the potential for fuel shortages, and MCS-01 – Facility Modernization with concerns on the cost impacts to industry. An additional 17 comment letters received after the release of the Proposed Modifications to the Draft 2007 AQMP and the Response to Comments on the Draft 2007 AQMP have been taken into account by staff and where appropriate, have been reflected in the Addendum to the Proposed Modifications to the Draft 2007 AQMP. Major comments received and the AQMD staff’s responses have been summarized in Attachment C to this Board Letter.

Key Policy Issues

There are four key policy issues related to the adoption of the 2007 AQMP for Board consideration which are briefly presented here:

1. “Bump-up” Request – Section 181(b)(3) of the CAA, “voluntary reclassification,” provides that “the EPA Administrator shall grant the request of any State to reclassify a nonattainment area in that State in accordance to a higher classification.” The voluntary request for reclassification to a more severe designation is commonly referred to as a “bump-up.” Under its current non-attainment classification, the District is prohibited from relying on “black-box” measures to demonstrate attainment. Areas classified “Extreme” may rely on ‘black box” measures to demonstrate attainment. The regional ozone modeling analyses demonstrates that without the use of the “black-box” measures, the 2024 maximum projected ozone design for the Basin would be, approximately 120 percent of the standard. Additional emissions reductions through 2023 are required to demonstrate ozone attainment. Therefore, the District is formally requesting CARB to submit a request to EPA for a voluntary reclassification of the South Coast Air Basin from “Severe-17” to “Extreme” nonattainment for ozone and that the EPA Administrator grant such request upon receipt. Through this request, the District is also seeking an extension of the ozone attainment date from June 15, 2021 to June 15, 2024.

A similar situation exists for the Coachella Valley Portion of the Salton Sea Air Basin. The District is formally requesting CARB to submit a request to EPA for a voluntary reclassification of the Coachella Valley Portion of the Salton Sea Air Basin from “Serious” to “Severe-15” nonattainment for ozone and that the EPA Administrator grant such request upon receipt. Through this request, the District is also seeking an extension of the ozone attainment date from June 15, 2013 to June 15, 2019.

2. Bifurcation of the Plan - The formal deadline for submission of the ozone attainment plan is June 15, 2007. The formal deadline for submission of the PM2.5 plan is April 5, 2008. Therefore, technically speaking, the PM2.5 plan is not due until 2008. However, the annual PM2.5 attainment date (i.e., 2015) is earlier than the 8-hour ozone attainment date of 2021 or 2024. In order to design the most efficient path to clean air, it is imperative that an integrated plan including both PM2.5 and ozone be developed. Furthermore, there are only seven years left to implement the necessary measures to attain the annual PM2.5 standard. The South Coast region needs a road map now to commit its resources for rule development, public and private funding, and technology deployment. District staff therefore recommends submitting an integrated plan including the annual PM2.5 and 8-hour ozone attainment demonstrations

3. District Staff’s Proposed PM2.5 Attainment Strategy - In the draft Plan, released in February 2007, District staff identified a reduction gap of 71 tons per day for PM2.5 attainment by 2015 based on the estimated reductions from the draft proposed State strategy along with District’s proposed control measures. Consequently, three policy options based on implementation of additional control measures and incentive funding were provided to close the gap (described in Appendix IV-B-2). In the revised draft state strategy, the reduction gap has increased to 74 tons per day of NOx due to foregone emission reductions for one of the state measures (i.e., off-road diesel equipment).

Based on further 3-agency (i.e., District, CARB, and SCAG) discussions to date, the District staff is proposing the following:

• The District is enhancing two of its proposed control measures (i.e., wood-burning fireplaces and wood stoves and commercial under-fired charbroilers) to obtain an additional 1.4 tons per day of directly-emitted PM2.5, which is equivalent to about 11 tons per day of NOx.
   
• Two control measures (i.e., High Speed Transport System and Truck-Only Lanes) submitted by SCAG are now incorporated in the draft Final AQMP which would achieve 22 tons per day of NOx reductions by 2014. Since these are mobile source-related, District staff proposes that CARB will backstop these reductions, only if necessary to ensure that these reductions are achieved.
   
• District staff proposes that CARB commit to an additional 41 tons per day of NOx reductions to close the attainment gap, bringing the total commitment to 163 tons per day by 2014.

In its revised draft State strategy, CARB staff has suggested that the District consider additional local measures for directly-emitted PM sources to close the reduction gap. Specifically, CARB staff has suggested mandatory curtailment of the use of fireplaces and woodstoves during winter months, requiring additional controls on commercial cooking (i.e., charbroilers), and strengthening fugitive dust controls.

District staff has agreed to enhance its existing control measure on wood-burning fireplaces and woodstoves but has serious concerns over the feasibility and enforceability of the mandatory curtailment suggested by CARB staff and the uncertainty in ambient concentrations from wood-burning. Also, the District’s control measure on commercial under-fired charbroilers has been strengthened to achieve additional PM2.5 reductions based on the installation of new and retrofit control equipment, similar to the proposed regulation currently being developed by the Bay Area Air Pollution Control District. However, despite these new reductions from measures proposed by District and SCAG, the PM2.5 standard can not be fully achieved by 2015, without additional reductions from mobile sources. In addition, inadequate initial steps would be made towards attainment of the new 24-hour PM2.5 standard and 8-hour ozone standard.

Therefore, since not fully attaining the annual PM2.5 standard by 2015 is not an acceptable or legally allowed public policy, the District staff is proposing that CARB commit to the additional 41 tons per day of NOx reductions from mobile sources to close the reduction gap for PM2.5 attainment by 2015. These NOx reductions will also be critically needed for achieving the 8-hour ozone and the 24-hour PM2.5 standards and making expeditious progress to implement all feasible measures. The District staff’s proposal represents a combination of possible regulatory actions and public funding programs which could be used by CARB to achieve the additional NOx reductions. District staff believes these measures are feasible.

4. Funding Availability – Substantial expenditures will be required in order to implement the strategies in the 2007 AQMP. The overall costs of implementing the control measures proposed in the Draft 2007 AQMP are expected to be in the billions of dollars. In-use mobile source fleet modernizations, accelerated retirement of high-emitting vehicles and equipment, alternative fuels and their infrastructure, advanced retrofits, facility modernization, and product reformulations and replacements are among strategies which require significant levels of expenditures. However, the economic values of avoiding adverse health effects are projected to be many times higher than the implementation cost of clean air strategies. In addition, the District staff believes the most effective use of public funding is to focus on early compliance and economic hardship in combination with regulatory requirements.

In order to meet the federal PM2.5 and 8-hour ozone ambient air quality standards, a significant amount of public and private funding will be required to implement some measures. A close collaboration among all stakeholders, government agencies, businesses, and residents would be critical to identify and secure adequate funding sources for implementing the AQMP control measures.

CEQA

Pursuant to California Environmental Quality Act (CEQA) Guidelines §15168, the AQMD has prepared a Program Environmental Impact Report (PEIR) for the 2007 Air Quality Management Plan.  The Draft PEIR was released for a 45-day public review and comment period beginning on March 2, 2007, and ending on April 17, 2007.  The Draft PEIR analyzed potential adverse impacts from implementing AQMP control measures in the following environmental areas: air quality; energy; hazards and hazardous materials; hydrology and water quality; and solid/hazardous waste.  Responses to all comments received have been prepared and incorporated into the Final PEIR for the proposed project.  Finally, since significant adverse environmental impacts and mitigation measures were identified for the proposed project, a Statement of Findings, a Statement of Overriding Considerations, and a Mitigation Monitoring Plan were prepared in accordance with the requirements of CEQA (Attachment 2 to the Board Resolution).

Socioeconomic Analysis

The socioeconomic analysis of the 2007 AQMP includes the cost, benefit, and other socioeconomic impacts of meeting the federal and state air quality standards. The analysis is presented at the sub-county level (19 regions within the four-county area).

Compliance with the federal annual PM2.5 and ozone standards and progress toward the state standards, including the state visibility standard, is projected to result in an average annual benefit of $14.6 billion. The $14.6 billion includes roughly $634 million for averted illness and $9.1 billion for averted premature deaths, $966 million for congestion relief, $3.6 billion for visibility improvements, $204 million for reduced damage to materials, and $18 million for increased crop yields. Not all of the benefits associated with the implementation of the 2007 AQMP can be quantified. The health benefit does not account for reduced emissions from pollutants other than PM2.5 and ozone. Neither have reductions in vehicle hours traveled for personal trips and damages to plants, livestock, and forests been quantified.

The projected annual implementation cost of the draft final Plan is $2.3 billion annually, on average. Transportation control measures alone contribute to 19 percent of the total cost with stationary source measures accounting for 5 percent of the total costs. A regional economic modeling was conducted to assess the AQMP economic impacts. Implementation of the 2007 AQMP as proposed could result in a net job gain due to clean air and avoided health effects. Eastern Los Angeles County areas are expected to have the largest share of benefit due to improvements in air quality and Southern Los Angeles County areas are expected to bear the highest control costs. Other socioeconomic parameters, such as competitiveness, occupational shifts, and price of consumption goods are not expected to have a significant change due to plan implementation.

The 2007 AQMP submitted for the Governing Boards’ consideration consists of the documents entitled:

• Draft 2007 Air Quality Management Plan (October 2006) including the following appendices:
   
  • Appendix I – Health Effects (October 2006)
  • Appendix II – Current Air Quality (October 2006)
  • Appendix IV-C – Transportation Control Measures (October 2006)
     
• Proposed Modifications to the Draft 2007 Air Quality Management Plan (February 2007) including the following appendices:
   
  • Appendix II – Current Air Quality (February 2007)
  • Appendix III – Base and Future Year Emission Inventories (February 2007)
  • Appendix IV-A – District’s Stationary and Mobile Source Control Measures (February 2007)
  • Appendix IV-B-1 – Air Resources Board Proposed State Strategy for California’s 2007 State Implementation Plan (February 2007)
  • Appendix IV-B-2 – District Staff’s Proposed Policy Options to Supplement CARB’s Control Strategy (February 2007)
  • Appendix IV-B-3 – South Coast Air Quality Management District’s Implementation of the Carl Moyer Memorial Air Quality (February 2007)
  • Appendix IV-C – Transportation Control Measures (February 2007)
  • Appendix V – Modeling and Attainment Demonstration (February 2007)
  • Appendix VI – Reasonably Available Control Measures (RACM) Demonstration (February 2007)
     
• Response to Comments on the Draft 2007 Air Quality Management Plan (February 2007)
   
• Draft Final AQMP (Attachment B)
   
  • Draft Final 2007 AQMP- Main Document (May 2007)
  • Addendum to the Proposed Modifications to the Draft 2007 AQMP – Appendices (May 2007)
     
• Final Program Environmental Impact Report for the 2007 Air Quality Management Plan (Attachment D)
   
  • Statement of Overriding Considerations (Attachment 2 to the Resolution)
     
• Draft Final Socioeconomic Report for the 2007 Air Quality Management Plan (Attachment E)

Due to the bulk of the above materials, they have been provided to the Governing Board members only. All of the above documents have been made available to the public on the AQMD Website and have also been made available through the AQMD Public Information Center.

Attachments (EXE 33.2mb )

1. Resolution
2. Draft Final 2007 AQMP
3. Summary of Major Comments Received on the Proposed Modifications to the Draft 2007 AQMP
4. Final Program Environmental Impact Report for the 2007 Air Quality Management Plan
5. Draft Final Socioeconomic Report for the 2007 Air Quality Management Plan