BOARD MEETING DATE: March 7, 2008
AGENDA NO. 29

REPORT:

Stationary Source Committee

SYNOPSIS:

The Stationary Source Committee met Friday, February 15, 2008. Following is a summary of that meeting. The next meeting will be March 21, at 10:30 a.m., in Conference Room CC8.

RECOMMENDED ACTIONS:

Receive and file.

Dennis Yates, Chair
Stationary Source Committee

Attendance

The meeting began at 10:30 a.m. Present were Dennis Yates, Ronald Loveridge (left at 10:55 a.m.), Joseph Lyou, and Gary Ovitt. Absent was Jane Carney.

ACTION ITEM

1. Program Announcement and Application for a Natural Gas Hearth Product Buy-Down Pilot Program

Jill Whynot, Director of Strategic Initiatives, described that in addition to efforts to adopt Proposed Rule 445 – Wood Burning Devices, a complementary effort is proposed to provide financial incentives to the public to switch to cleaner hearth products. Ms. Whynot explained that the goal was to hire one or more contractors to implement the program and that a Program Announcement and Application that describes desired contractor capabilities has been developed for consideration. Ms. Whynot concluded by indicating that this item, designation of $500,000 from currently available Rule 1309.1 Priority Reserve funds and authorization to release the Program Announcement and Application, is on the March Governing Board meeting agenda.

No public comments were made. Committee Member Lyou mentioned that the funds would be from the 2001 amendments to 1309.1. He asked if it would be possible to prioritize areas affected by power plants or perhaps downwind, inland valley areas. Committee Chairman Yates indicated that the Carl Moyer methodology could be used to target specific areas for program implementation, including environmental justice (EJ) areas. Staff will add EJ areas to the program announcement criteria. Committee Member Loveridge indicated that many other air districts have implemented such programs and staff should implement the lessons learned from these agencies. He requested information on these programs be provided at the March 7^th Board meeting.

Moved (Lyou) seconded (Loveridge), and unanimously recommended for approval.

INFORMATIONAL ITEMS

2. Gregg Industries Compliance Update

Committee Chairman Yates announced, due to advice of counsel and ongoing settlement negotiations, discussion would be limited on this item as necessary to prevent disclosure of confidential attorney/client communications. He then highlighted that since the last Committee briefing on October 26^th, he and Committee Member Lyou co-hosted a Town Hall meeting at Rio Vista Elementary School in El Monte on December 17, 2007 which focused on odor situations in the local community. In addition, Carol Coy, Deputy Executive Officer for Engineering and Compliance, summarized information on the ten complaints received in 2008 including a multiple complaint odor event on February 13^th. Peter Mieras, District Prosecutor, concluded the discussion with brief comments on the status of ongoing Notice of Violation settlement negotiation.

Four individuals spoke during public comments. Joe Blackburn expressed continuing concern regarding his Gregg Industries odor complaints and the DTSC inspection findings and handed out a complaint letter to the Board. Larry Ortega, representing Amigos de los Rios, expressed concerns that many complainants have not accepted Gregg Industries’ invitations to tour the facility to better understand the situation. He further pointed out many employees live in the local area and he is concerned for their jobs. He felt there was a growing correlation between AQMD meetings and increased complaints. Bob Welemin shared his concerns regarding the amount of air pollution, especially particulates, that Gregg is allowed to emit. Ms. Kelly Andrews expressed continuing concerns about odors from Gregg Industries.

    2A. Review of Proposed Logos for Public Outreach of Wood Burning Program

Sam Atwood, Media Office Manager, presented three proposed logos and taglines to be used for “branding” all future media and public outreach efforts associated with proposed Rule 445 and the proposed gas-log incentive program.  The three taglines were: “Healthy Hearths,” “Be Green, Burn Clean” and “Light it Right.”  After discussion and feedback from the Board Members as well as the audience, the committee chose “Healthy Hearths” and its associated logo for use in future media and public outreach associated with the wood burning rule and incentive program.

3. Rule 1125 – Metal Container, Closure, and Coil Coating Operations

Larry Bowen, Planning and Rules Manager presented this item. The amendments to Rule 1125 set new VOC limits for inkjet inks, inkjet ink make-up solvents and end sealing compounds based on currently available technology. Overall it will achieve an estimated 0.3 tons per day VOC emission reduction at no additional cost to industry.

4. Rule 461 – Gasoline Transfer and Dispensing

Larry Bowen presented this item. The amendments to Rule 461 will assist in the implementation of Phase II of the state-mandated enhanced vapor recovery program by requiring a compliance plan from those gasoline dispensing operators that have not yet installed the required equipment as the implementation deadline approaches. In addition, the proposal addresses training and other issues regarding installation and repair contractors and testers to enhance vapor recovery equipment efficiency and field enforceability of program requirements.

Ron Wilkniss, representing WSPA, stated they want a smooth transition for implementation of EVR and suggested a one month delay in the rule adoption. WSPA recommends a waiving of permit fees as a financial incentive for early compliance and will continue to work with staff to resolve specific issues.

Carol Kaufman, representing Metropolitan Water District, requested a Phase II EVR exemption for fleet operators, mostly public agencies, that fuel their ORVR-equipped vehicles at their own low-throughput, non-retail dispensing facilities.

Chairman Yates suggested that fuel suppliers share accountability for gasoline storage and dispensing equipment compliance.

5. Status Report on Proposed Rule 314 – Architectural Coatings Fees

Larry Bowen presented this item. Proposed Rule 314 is a fee rule to recover the AQMD cost of regulating architectural coatings as authorized by state law. The proposed fee is based on both coating quantities and emissions from the coatings. Adoption has been delayed a number of times at the request of the paint industry in attempts to resolve issues they have with the rule. Staff recommends moving forward with implementation in 2008.

Billy Evans, Chairman of the Board of Dunn Edwards stated he knows it is no surprise to the Committee the he and the industry do not want the fee. But if there is to be a fee, there is no need to rush a proposal through particularly in these times of economic downturn. He also stated that this is not a good time for the AQMD to expand the program solely to pre-fund anticipated program costs.

Curtis Coleman, representing Sherwin Williams stated the company also has concerns about the enhanced program versus the current program costs. If there are to be fees they should be phased in over three years and in order to work out some of the issues, and the hearing should be postponed to May when the other fee rules are heard.

John Long, representing Vista Paints, requested the program, particularly any enhancements, should be phased in gradually over several years and there should an assessment of who the rule violators actually are. A fee program for the retailers is superior to one for the manufacturers. One targeting the distributors is also more accurate than one targeting just the manufacturers.

Dave Darling, representing NPCA agreed that a program targeted to the retailers or distributors would be more equitable than one targeted to manufacturers. This is in general the position of his member companies. He suggested there should be a sunset provision and an assessment of where non-compliance is found.

Howard Berman, representing Zinsser and Rustoleum, stated any fee program should be phased-in over several years and requested a delay to the May hearing date to work out remaining issues.

Based on these comments, the Committee directed staff to reevaluate the rule, particularly focusing on equity between in-state and out-of-state manufacturers.

6. Rule 1149 – Storage Tank Cleaning and Degassing

This item was carried over to the March meeting.

7. Status Report on Results of South Bay Flare Event Notification Survey

This item was carried over to the March meeting.

8. RECLAIM Annual Report

Carol Coy reported that this regular Annual RECLAIM Report would be presented in public hearing at the March Board meeting and in recognition of the late hour called the Committee’s attention to the summary attached to the Committee agenda. The summary highlights continuing high compliance rates and the issue of increasing investor holdings of future year credits which has the potential to result in a seller’s market.

WRITTEN REPORTS

A written report for Proposed Rule1472 – Requirements for Facilities with Multiple Stationary Emergency Standby Diesel-Fueled Internal Combustion Engines was provided to the Committee.  Ms. Julie Puentes, from the Hospital Association of Southern California, addressed the Committee.  She thanked AQMD staff for working with them and their constituents, and questioned the compliance dates for the hospitals. It was not clear to Ms. Puentes if the rule language is consistent with staff’s intent. Dr. Chang noted that she would meet with Ms. Puentes after the meeting to go over her concerns. The Committee directed Elaine Chang and AQMD staff to meet with Ms. Puentes and Mr. Tom Schipper, State Chair of California Society for Healthcare Engineering, Inc., to discuss how the rule compliance dates have been structured to be consistent with the compliance dates for acute care hospitals that require seismic retrofit.  (Staff will also give a presentation to the Hospital Association at their Orange County facility on Tuesday, Feb. 19, 2008.)

All written reports were acknowledged by the Committee.

The meeting was adjourned at 12:10 p.m.

Attachments (doc 73kb)

February 15, 2008 Committee Agenda (without its attachments)