MEETING BEFORE THE CALIFORNIA AIR RESOURCES BOARD BOARD HEARING ROOM 2020 L STREET SACRAMENTO, CALIFORNIA THURSDAY, AUGUST 27, 1998 9:30 A.M. Vicki L. Medeiros, C.S.R. License No. 7871 PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 ii MEMBERS PRESENT John D. Dunlap, III, Chairman Joseph C. Calhoun Mark DeSaulnier Dr. William Friedman Jack C. Parnell Barbara Patrick Sally Rakow Barbara Riordan Ron Roberts Staff: Tom Cackette, Chief Deputy Executive Officer Mike Scheible, Deputy Executive Officer Kathleen Walsh, General Counsel Jim Schoning, Ombudsman PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 iii I N D E X --o0o-- Page Proceedings 1 Call to Order 1 Pledge of Allegiance 1 Roll Call 1 Opening remarks by Chairman Dunlap 1 AGENDA ITEMS: 98-8-1 Continuation of a Public Meeting to Consider the Adoption of a Regulatory Amendment Identifying Diesel Exhaust as a Toxic Air Contaminant Introductory remarks by Chairman Dunlap 2 Staff Presentation: Mike Shceible 4 Geneveive Shiroma 5 Dr. Froines 12 Dr. Denton 17 Public Presentation: Kelly Jensen 24 Jeff Sickenger 25 Dr. Chung S. Lui 27 Bonnie Holmes-Gen 28 Jed Mandel 31 Allen Schaffer 33 Todd Campbell 35 Janet Hathaway 36 Stephanie Williams 37 98-9-1 Public Meeting to Consider Approval of Triennial Progress Reports and Plan Revisions Developed Under the California Clean Air Act Introductory remarks by Chairman Dunlap 47 PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 iv I N D E X (Continued) --o0o-- Page Staff Presentation: Lynn Terry 49 Peggy Taricco 50 Public Comment: Ellen Garvey 71 Douglas Quetin 75 Kathy Reheis 76 98-9-2 Public Hearing to Consider Amendments to the California Cleaner-Burning Gasoline Regulations Introductory remarks by Chairman Dunlap 81 Staff Presentation: Mike Scheible 83 Richard Vincent 84 Bruce Oulrey 122 Public Presentation: Todd Campbell 98 Mike Kulakowski 100 Al Jessel 111 Tom Koehler 118 Janet Hathaway 119 Catherine Witherspoon 121 Afternoon Session 133 Kathleen Walsh 159 Tom Jennings 159 98-5-6 Continuation of a Public Hearing to Consider the Adoption, Amendment and Repeal of Regulations Regarding Certification Procedures and Test Procedures for Gasoline Vapor Recovery Systems Introductory remarks by Chairman Dunlap 133 PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 v I N D E X (Continued) --o0o-- Page Staff Presentation: Tom Cackette 133 Cindy Castronovo 136 Bruce Oulrey 142 98-9-3 Public Hearing to Consider the Amendment of Regulations Regarding Stationary Source Test Methods Introductory remarks by Chairman Dunlap 146 Staff Presentation: Tom Cackette 146 Cindy Castronovo 148 Bruce Oulrey 153 98-9-5 Public Meeting to Consider Appointments to the Research Screening Committee Introductory remarks by Chairman Dunlap 156 Staff Presentation: Dr. John Holmes 157 98-9-4 Public Meeting to Consider Research Proposals Introductory remarks by Chairman Dunlap 164 Staff Presentation: Dr. John Holmes 165 Open Session to Provide an Opportunity for Members of the Public to Address the Board on Subject Matters within the Jurisdiction of the Board 168 Pollution Prevention Week Presentation Introductory remarks by Chairman Dunlap 169 PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 vi I N D E X (Continued) --o0o-- Page Staff Presentation: Joe Irvin 169 Adjournment 179 Certificate of Reporter 180 --o0o-- PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 1 1 P R O C E E D I N G S 2 --o0o-- 3 CHAIRMAN DUNLAP: Will the August meeting of the 4 California Air Resources Board please come to order. 5 We would ask the audience to please rise with 6 Barbara Riordan while she leads us in the Pledge of 7 Allegiance. 8 (Thereupon the Pledge of Allegiance was recited.) 9 CHAIRMAN DUNLAP: Thank you, Mrs. Riordan. 10 Ms. Hutchens, would you please call the roll. 11 MS. HUTCHENS: Calhoun. 12 BOARD MEMBER CALHOUN: Here. 13 MS. HUTCHENS: DeSaulnier. 14 BOARD MEMBER DeSAULNIER: Here. 15 MS. HUTCHENS: Edgerton. 16 Friedman. 17 BOARD MEMBER FRIEDMAN: Here. 18 MS. HUTCHENS: Parnell. 19 BOARD MEMBER PARNELL: Here. 20 MS. HUTCHENS: Patrick. 21 BOARD MEMBER PATRICK: Here. 22 MS. HUTCHENS: Rakow. 23 BOARD MEMBER RAKOW: Here. 24 MS. HUTCHENS: Riordan. 25 BOARD MEMBER RIORDAN: Here. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 2 1 MS. HUTCHENS: Roberts. 2 BOARD MEMBER ROBERTS: Here. 3 MS. HUTCHENS: Silva. 4 Chairman Dunlap. 5 CHAIRMAN DUNLAP: Here. 6 Thank you. 7 I would like to remind those of you in the audience 8 who would like to present testimony to the Board on any of 9 today's Agenda items, to please sign up with the Clerk of the 10 Board. If you have a written statement, we would ask you to 11 please give 20 copies to our Clerk. 12 The first Item on the Agenda today is 98-8-1, which 13 is a Continuation of a Public Hearing to Consider the 14 Adoption of a Regulatory Amendment Identifying Diesel Exhaust 15 as a Toxic Air Contaminant. 16 This Item will be the staff's proposal to identify 17 diesel exhaust as a TAC, which is being continued from our 18 July thirtieth hearing. 19 Because of Legislative interest, we decided to 20 defer action on this Item until after the August fourth 21 Senate Transportation Committee hearing, in which the 22 identification of diesel exhaust was discussed. 23 Staff will discuss the outcome of that hearing 24 later in their presentation. The record from the July 25 hearing has remained open, and we will again take public PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 3 1 testimony after the staff presentation. 2 I would like to acknowledge two members of the 3 Scientific Review Panel who are here today, Dr. John Froines, 4 from UCLA, who has been acting as the Chair of the SRP, and 5 Dr. Craig Byus. 6 Thank you, gentlemen, for coming. I would also 7 like to note that Joan Denton, our Director of OEHHA, is 8 here. 9 Good morning, gentlemen. The SRP continues to make 10 an invaluable contribution to our Toxic Air Contamination 11 Program by providing comprehensive and scientific peer review 12 of our reports. 13 I know that staff has continued to work closely 14 with interested stakeholders on trying to discuss the issues 15 discussed at the July thirtieth hearing. 16 It appears that great progress has been made in 17 gaining agreement on how the most significant issues can be 18 addressed. 19 I understand that staff has a revised proposal for 20 us today that responds to many of the concerns that we heard 21 last month, and which has, we're told, the support of many of 22 those who testified in July. 23 I believe that it is important for the Board to 24 make its decision on this Item. 25 To that end, Mr. Scheible, would you please begin PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 4 1 the staff presentation. 2 MR. SCHEIBLE: Thank you, Mr. Chairman, and Members 3 of the Board. As Chairman Dunlap indicated, the staff has 4 worked very hard with the interested stakeholders since the 5 July hearing. 6 We believe that we have identified an approach 7 which is consistent with the scientific information assembled 8 by OEHHA and the SRP, acceptable to a broad coalition of 9 stakeholders and fully effective in protecting public health. 10 To that end, we are modifying the original staff 11 proposal, which was to identify whole diesel exhaust as a 12 toxic air contaminant, and now recommending the Board 13 identify particulate emissions from diesel fueled engines as 14 a toxic air contaminant. 15 Staff will present how this approach will be used 16 to comprehensively deal with all of the harmful substances in 17 diesel exhaust in the risk management process. 18 Because we will consider comprehensively all of 19 those harmful substances, we believe this approach is just as 20 protective of public health as our original proposal. 21 Staff also proposes the Board include language in 22 its adopting Resolution to address issues related to future 23 risk management activities by the Air Resources Board and the 24 district and also include the language about the relationship 25 of the ARB action and other legal challenges related to PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 5 1 diesel emissions, such as Proposition 65. 2 With that, I would like to call upon Genevieve 3 Shiroma, Chief of the Air Quality Measures Branch in the 4 Stationary Source Division, to present a short overview of 5 this Item, a summary of the outcome of the Senate 6 Transportation Committee hearing and a staff proposal to 7 address the issues. 8 Thank you. 9 Ms. Shiroma. 10 MS. SHIROMA: Thank you, Mr. Scheible, and good 11 morning Chairman Dunlap, and Members of the Board. 12 My name is Genevieve Shiroma, and I will be 13 presenting a brief summary from the July Board hearing, a 14 summary of the Senate Transportation Committee hearing and 15 the staff's proposal to address the issues that have been 16 raised. 17 Today the Board is continuing its deliberation on 18 the listing of diesel exhaust as a toxic air contaminant. 19 The listing would be based on whether it meets the 20 definition of a toxic air contaminant and whether or not a 21 threshold exposure level can be identified below which no 22 significant adverse health effects are anticipated. 23 In adopting an identification, the Board accepts 24 but does not adopt the cancer and noncancer risk values as 25 presented in the comprehensive risk assessment. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 6 1 In doing so, a central guidance is provided to the 2 risk management process. As discussed at the July hearing, 3 we have a comprehensive Toxic Air Contaminant Program in 4 California. 5 A toxic air contaminant, or TAC, is defined in the 6 law as an air pollutant which may cause or contribute to an 7 adverse or an increase in mortality or in serious illness, or 8 which may pose a present or potential hazard to human health. 9 As a reminder, this slide shows the chronology of 10 the extensive nine-year process for the evaluation of diesel 11 exhaust. 12 Many issues were discussed at the July Board 13 hearing. However, the comments focused on three themes: The 14 form of the listing; the use of risk values; and the 15 potential litigation under Proposition 65. 16 Since the Board hearing, we have worked very hard 17 with a broad spectrum of stakeholders to address these 18 issues. 19 As Mr. Scheible indicated, we believe we have 20 identified an approach which is consistent with the 21 scientific information assembled by OEHHA and the SRP, 22 acceptable to most, if not all, stakeholders, and fully 23 effective in protecting public health. 24 In the next three slides I will talk about these 25 three issues in more detail and our specific proposal to PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 7 1 address each. 2 As you heard at the July thirtieth hearing, there 3 is concern over the form of the listing of diesel exhaust as 4 a TAC. 5 Primarily, there are concerns that given the 6 continuing advances in engine technology and fuel, the nature 7 of the emissions may change to a point where the toxic 8 components are not a concern and it would be inappropriate to 9 call diesel exhaust a toxic air contaminant. 10 To address these concerns, commenters asked that 11 the form of listing be modified to reflect specific 12 components of the emissions that are of concern. 13 In response to this comment, we determined that we 14 could clarify the listing to focus on the pollutants in 15 diesel exhaust of greatest concern. These are the 16 particulate emissions and organic vapor phase components. 17 I would like to take you through the logic of this 18 proposed clarification. As you have heard, diesel exhaust is 19 a complex mixture of gases and fine particles. 20 The available evidence indicates that particulate 21 matter in organic vapor phase emissions are the most likely 22 contributors to adverse health impacts from exposures to 23 diesel exhaust. 24 Many of the organic vapor phase substances emitted 25 by diesel fueled engines have already been listed by U.S. EPA PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 8 1 as hazardous air pollutants, and by the ARB as TACs. 2 Other organics can be controlled as VOCs if we 3 determine they convey a substantial part of a health risk 4 posed by diesel exhaust. 5 Listing the particulate emission from diesel fueled 6 engines will complete the process of identifying the 7 emissions that pose the greatest risk and enable all harmful 8 emissions to be addressed. 9 The staff, therefore, proposes to list particulate 10 emissions from diesel fueled engines as a TAC. We believe 11 this approach is equally health protective and provides the 12 clarification needed to address the concerns. 13 Also, on July thirtieth, you heard concerns about 14 the use of the range of risk health numbers in the context 15 that they were derived from studies which used older engines 16 and fuels. 17 I note that the range of risk estimates reflect the 18 best scientific information available. It incorporates the 19 results from over 30 human studies, which used standard 20 scientific methods and risk assessment practices. 21 We also acknowledge the changes in fuel formulation 22 and engine technologies have reduced the mass emissions, 23 which we accounted for in our exposure estimates. 24 These changes may also have had an effect on the 25 particulate characteristics and chemical composition. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 9 1 Further research would be helpful in this area. 2 ARB and OEHHA staff will follow the future studies. 3 To provide guidance to the air pollution control 4 districts, we will develop risk management guidelines for use 5 in their permitting and other stationary source programs. 6 We will work closely with the air districts, 7 effected industry, environmental groups and other interested 8 parties, and we will report within one year to the Board on 9 our progress. 10 Also, on July thirtieth, you heard concerns that 11 this listing may generate many separate civil actions and 12 proceedings under other statutes, or general provisions of 13 the law. 14 You heard a thorough discussion from Mr. Kirk 15 Oliver, of our Office of Legal Affairs, that the ARB's Toxic 16 Air Contaminant Program and Proposition 65 are two different 17 programs which act separately and operate independently of 18 each other. 19 Proposition 65 is a notice law. Under Proposition 20 65, diesel exhaust has been listed as a chemical known to 21 cause cancer since 1990. 22 Since that time, lawsuits have been filed and 23 prosecuted independent of the proposal to identify diesel 24 exhaust as a TAC by ARB. 25 The action we are proposing today is under the PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 10 1 purview of the AB 1807 statues for the identification and 2 control of TACs, and the risk values were developed in the 3 context of this Program. 4 However, we are sensitive to concerns voiced on 5 July thirtieth regarding the potential use of the reported 6 unit risk values in the context of civil litigation. 7 We propose that language be included in the Board's 8 Resolution that acknowledges this and specifies that the 9 proper courts must determine whether the use of the risk 10 values is appropriate for specific sources, fuel 11 formulations, engine technologies and exposures and issues in 12 any such litigation. 13 Next, I will give a short overview of the August 14 fourth Senate Transportation Committee hearing on the future 15 of diesel fuel and related health effects. 16 There were four panels: A panel of scientific 17 representatives; industry representatives; environmental 18 representatives; and engine manufacturing representatives. 19 The same issues as those discussed on the July 20 thirtieth hearing were raised through the course of the 21 discussion. 22 At the end of the hearing, Senator Quinton Kopp 23 provided his views. He's the Chair of the Committee. 24 Again, the ARB has had a full public process of 25 almost a decade. ARB has fully followed the AB 1807 law. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 11 1 In his view, ARB should continue with its process 2 for identification, and he felt that some guidance would be 3 helpful on the use of the range of risk. 4 In conclusion, we recommend that the Board approve 5 our modified proposal to identify particulate emissions from 6 diesel fueled engines as a toxic air contaminant with no 7 identified level of exposure below which no carcinogenic 8 effects are anticipated. 9 We recommend that the Board direct staff to begin 10 the risk management phase and to form a diesel emissions risk 11 management working group to coordinate efforts with the U.S. 12 EPA, industry, environmental groups and other interested 13 parties. 14 We would convene a first meeting within two months 15 of a listing. We also recommend that the Board direct staff 16 to work closely with OEHHA, the air districts, affected 17 industry and other interested parties to develop risk 18 management guidelines that the districts can use for 19 permitting stationary diesel engines. 20 The staff will report back to the Board within one 21 year on the progress towards developing these guidelines. 22 Again, we believe this approach is consistent with 23 the scientific information assembled by OEHHA and the SRP, 24 acceptable to a broad coalition of stakeholders and fully 25 effective in providing protection of public health as the PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 12 1 original staff proposal. 2 Thank you. That ends my presentation. 3 We would be happy to answer any questions you may 4 have. 5 CHAIRMAN DUNLAP: Thank you, Ms. Shiroma. 6 It is clear that great progress has been made, but 7 before we get into asking the staff questions, I would like 8 to turn the time to Dr. Froines, who, as all of you know, has 9 been serving as the Chair of the SRP, to give some indication 10 to the Board about how he views the staff's modified 11 proposal. 12 Dr. Froines, is the staff's recommendation to list 13 the particulate emissions from diesel fueled engines a 14 reasonable way to proceed? 15 DR. FROINES: Thank you, Chairman Dunlap. Good 16 morning, Members of the Board. 17 I would like to take a couple of minutes. I would 18 like to take a couple of minutes answering the question for 19 you. 20 First, I wanted to -- 21 CHAIRMAN DUNLAP: We have got you using the light 22 there, Dr. Froines. 23 It happens to me too, so -- 24 BOARD MEMBER FRIEDMAN: He's a Professor. 25 DR. FROINES: At the Board meeting a month ago, I PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 13 1 reported on the findings of the SRP with respect to diesel 2 exhaust, and at that meeting I commented on two papers, two 3 scientific papers that had been reported after the SRP had 4 met, and I described them to you and described that they 5 showed an increased risk of lung cancer associated with 6 exposure to diesel exhaust. 7 Now, I just want to take a second to mention two 8 other papers for the record that have actually been published 9 since the last Board meeting. 10 One is a paper entitled, "Occupational Exposure to 11 Gasoline, Diesel and Propane Engine Emissions and Risk of 12 Lung Cancer," and the second paper is entitled, "Enhancement 13 of Allergic Inflammation by the Interaction Between Diesel 14 Particles and the Immune System." 15 Without taking time to quote from them, I will just 16 simply say that both papers demonstrate a positive 17 relationship between adverse health consequences and exposure 18 to diesel exhaust. 19 So, they represent, I think, the importance of 20 continuing research, and they add to the consistency of 21 results that we have had on these issues indicating that 22 there are health problems in humans associated with exposure 23 to diesel exhaust. 24 I begin my remarks by commenting on those papers, 25 because as the person representing the Scientific Review PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 14 1 Panel, I really do want to always emphasize and reemphasize 2 the conclusions of the Scientific Review Panel on the health 3 effects of a particular toxic air contaminant. 4 I want you to in a sense realize that our focus 5 will always be on the science. The issue of diesel exhaust 6 has been very controversial. Everybody in the room knows 7 that. 8 The Legislature has been involved, as Genevieve 9 just said, and there has been a considerable discussion, at 10 times relatively heated. 11 I want to emphasize one important point here, and 12 that is the SRP will always attempt to bring to this Board 13 our best evaluation of the scientific issues associated with 14 a proposed toxic air contaminant. 15 We will always try to be the window into which the 16 Board can view the scientific issues separate from other 17 matters of concern. 18 We will always do our very best to present 19 objective scientific information to you. 20 To turn to the Chair's question, I want to be quite 21 emphatic, if I did not believe the approach that was proposed 22 by staff before you today was not adequate scientifically, I 23 would be the first to say so. 24 I would be the first to tell you that this doesn't 25 work if I thought it didn't work as a matter of science. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 15 1 This process has gone on too long, and there have 2 been such important issues at stake that I would be remiss if 3 I accepted changes that would compromise the science and, 4 therefore, the public health. 5 I won't do that now, and I won't do it ever. 6 I support, and I strongly support the approach 7 proposed by staff and believe it will serve us well as they 8 move forward to address issues of risk exposure, health, 9 technology, fuels and other diesel related matters. 10 I think this approach is very good. I think the 11 approach provides an incentive for industry, environmental 12 groups and government to move forward to address the control 13 of diesel related exposures. 14 I believe the participants in the discussions that 15 led to this approach should be congratulated for putting 16 together an approach which will serve us well in the future. 17 I want to make a couple of comments for the record 18 on the approach. I think it is extremely important that the 19 Resolution acknowledges, and I quote, "Whereas the scientific 20 evidence indicates particulate matter and organic vapor phase 21 emissions are the most likely contributors to adverse health 22 effects from diesel exhaust," I think this statement is 23 important because we need to specifically recognize that 24 there may be contributions from both gases, vapors and 25 particulate matter in the health effects associated with PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 16 1 diesel exhaust. 2 That doesn't in any way detract from the approach 3 suggested here, but it's important to recognize that health 4 effects may occur as a result in combination of vapor and 5 particulate and that we are dealing with a multi-causal 6 phenomena. 7 I think it would be useful in the future, over 8 time, for the Board, for the staff to identify vapor phase 9 components that haven't been identified as TACs to move 10 forward to identify them as TACs, and as we think would be 11 appropriate and necessary to improve our understanding of the 12 causality associated with diesel exhaust emissions. 13 I now think that doing lots more epidemiologic 14 studies may or may not be in the best interest of the science 15 associated with this particular issue. 16 I now think that mechanistic studies to better 17 identify causal factors might actually be better and have 18 more short-term benefits. 19 As we look forward to research in the future, I 20 think we need to look at the issues and ask ourselves, what 21 is the best kind of research that needs to be done, and I 22 think mechanistic research might be of particular value. 23 In addition to organic vapors and particulate 24 matter, I think that we shouldn't forget the potential role 25 of criteria pollutants, nitrogen oxides, ozone, what have PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 17 1 you. 2 The Board clearly has a way to deal with those risk 3 related issues, although I think that that shouldn't be lost 4 as we look at this overall issue, because we don't know how 5 chemicals interact to produce some of the effects that may be 6 occurring. 7 So, finally, I want to say once again that I 8 support this Resolution, and I believe that it will serve us 9 well in the future, and I congratulate everybody who 10 participated in developing it. 11 Thank you, very much. 12 CHAIRMAN DUNLAP: Thank you, Dr. Froines. I 13 appreciate those views, also the comments about research. 14 We'll come back to that as we conclude on this 15 Item. 16 Before -- again, I will forestall questions just 17 for a few more minutes. 18 Dr. Denton, Director of OEHHA, I appreciated your 19 involvement as a partner, not only with the SRP but with our 20 team here. 21 Joan, how do you view the staff's modified 22 recommendation to list the particulate matter portion of 23 diesel exhaust? 24 That's the primary question of the day. 25 DR. DENTON: Mr. Chair, Members of the Board, for PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 18 1 the record, I just want to assure you, Members of the Board, 2 that identifying the particular component of diesel exhaust 3 is fully consistent with OEHHA's health risk assessment 4 developed over the last nine years. 5 So, John, the short answer is, yes. 6 CHAIRMAN DUNLAP: Thank you. Very good. 7 Mr. Schoning, would you please address the process 8 prior to today by which this Item came before us and share 9 any concerns or other comments that you may have with the 10 Board at this juncture. 11 MR. SCHONING: Yes, Mr.Chairman and Members. 12 Last month, we shared with you in some detail the 13 record of this decade-long Item and process by which it came 14 before you. 15 Today, I think it's prudent simply to be brief and 16 to commend all of the peacemaker stakeholders involved in 17 bringing this proposal to you, and particularly a very hard 18 working ARB staff who put in many hours into this issue along 19 with all of the stakeholders. 20 We are very pleased with the process. 21 CHAIRMAN DUNLAP: All right. Very good. 22 Thank you, Jim. Okay. 23 Now, did any of the Board Members have any 24 questions before we get into the witnesses? 25 We have eight witnesses that have signed up, and PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 19 1 they are a broad cross-section of stakeholders, including 2 industry, environmental community and a regulatory agency or 3 two. 4 Would your preference be to hear from them? 5 Dr. Friedman. 6 BOARD MEMBER FRIEDMAN: I just want to add my 7 congratulations. 8 I found inspiriting the discourse between the 9 industry, environmentalists and the staff in forging, what I 10 think, is a major advance. 11 With respect to the particulate issue, I think that 12 it was the wisdom of the Scientific Review Panel in the first 13 place to give us data normalized for particulates from the 14 very beginning, and this, in fact, is simply a recognized 15 extension of that principle, so I think, you know, I think 16 it's exactly the right way to go about doing business. 17 Further, it's the really small particulates that I 18 am concerned about with respect to the cancer risk, because 19 they hang around. 20 If there are molecules attached to them that are 21 toxic, and I think that very likely, that is the key focus of 22 interest. 23 It also affords, as John said a moment ago, 24 opportunities for research that won't take 35 to 40 years 25 before an answer is forthcoming. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 20 1 The whole issue of creating a risk management 2 working group is very sound. It is always appropriate to 3 serially evaluate a scientific basis of decisions. 4 This is entirely in keeping with our responsibility 5 and the charge to the Board. 6 So, I just wanted to add my own congratulations, 7 and I think it is a really good step forward. 8 Thank you. 9 CHAIRMAN DUNLAP: Thank you, Dr. Friedman. 10 Supervisor Roberts. 11 BOARD MEMBER ROBERTS: I want to make sure I am 12 speaking in the microphone and not the light here. 13 John, just as one of the lay people here, not part 14 of the scientific community, when we first visited this we 15 really talked about this mix, this diesel exhaust as it was a 16 soup, and now we are talking about certain things in that 17 soup, the meatballs and the vegetables that have been 18 identified as being the problems, I guess. 19 The thought occurred to me as the difference in 20 approach is that in one case we were talking about the whole 21 as opposed to all these pieces, and as I remember the earlier 22 presentation, the breakdown of pieces is pretty complex. 23 Are we in a position -- do we feel comfortable that 24 we are -- that we have the proper research to identify all of 25 those pieces? PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 21 1 CHAIRMAN DUNLAP: Well, Dr. Froines, I will let 2 you, and perhaps Genevieve, take a stab at responding, but 3 maybe I would lead with this. 4 The most important, the meatballs and the, what did 5 you say, vegetable, I guess, are really incorporated in the 6 particle element, and that is what we know, we have more 7 certainty about, and that's why the emphasis, where we are 8 hearing the support, certainly from those that we have heard 9 from thus far, and hopefully we will hear some feeling from 10 those that are set to testify, is that we are on the right 11 course for dealing with what we know most about. 12 Genevieve, you and Dr. Froines, perhaps, would like 13 to answer that better. 14 MS. SHIROMA: Yes. 15 Supervisor Roberts, yes, we are confident that we 16 are tackling the right actors, the particulate emissions, the 17 vapor organics. 18 Diesel exhaust has water vapor, carbon dioxide and 19 so forth. We know enough to have said even in the staff 20 report that we would be focusing all the particulate 21 emissions and the vapor organics. 22 CHAIRMAN DUNLAP: Okay. Dr. Froines. 23 DR. FROINES: Am I on? 24 CHAIRMAN DUNLAP: You are on. 25 DR. FROINES: I think there are a couple of PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 22 1 issues, and I'll be very brief, Bill Friedman said that it's 2 the academics that go on and on, and judging from how short 3 Joan was, I fall into that trap. 4 I just want to say that one of the important 5 features is that we don't know what causes lung cancer from 6 tobacco smoke. 7 We know that particulates play an important role, 8 and vapors play an important role, and we have moved ahead in 9 this society to address tobacco smoke and environmental 10 tobacco smoke, and we haven't said, we need to know what each 11 individual one of those thousands of chemicals contribute 12 before we can do something about tobacco smoke. 13 I think diesel exhaust is exactly the same issue. 14 We don't know what each chemical within diesel exhaust 15 contributes, and they probably interact. 16 They probably are all contributing, or a number of 17 compounds are contributing, and it's going to be hard to sort 18 out which compounds are contributing, which is why the 19 Polanca bill wanted to take us out to too fine a level of 20 detail. 21 I think that what we are dealing with now in terms 22 of addressing the issue of particulate is precisely the 23 approach to take, and I think over time to sort out some of 24 the issues about vapor and particles will be valuable, and so 25 I think the answer to the question is, yes, we are moving in PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 23 1 the right direction, and I would only argue that we have to 2 stay away from trying to subdivide these thousands of 3 chemicals. 4 BOARD MEMBER ROBERTS: That's precisely the 5 question that I was asking. 6 I wanted to make sure we weren't going down to too 7 far a level. 8 DR. FROINES: I would think that that would not be 9 in the best public health interest. 10 I think, of course, we always want to know more 11 about the importance of some of those compounds and learn 12 more about that. 13 BOARD MEMBER ROBERTS: That was exactly the 14 question. 15 DR. FROINES: I think that research is necessary 16 to do that in the way that in the new PM 2.5 standard, we 17 want to learn more about what causes the morbidity and 18 mortality, but I think we also want to avoid sort of becoming 19 paralyzed by saying, we need to know the contribution from 20 every chemical before we can move forward. 21 I think that would be a mistake, and I think this 22 is the kind of compromise that allows us to move forward and 23 yet acknowledges that there are differences. 24 BOARD MEMBER ROBERTS: So, the next step would have 25 been getting down to something smaller than the meatball, and PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 24 1 we haven't done that yet? 2 DR. FROINES: We don't want to do that. 3 CHAIRMAN DUNLAP: Culinary examples do work on 4 occasion. 5 Thank you, Ron. 6 Now, if there aren't any other pressing questions, 7 why don't we go on to the witness list, if that's okay. 8 So, I will ask those who have signed up, I'll just 9 run down the list in the order that I was given them. 10 Kelly Jensen, from the California Chamber, Jeff 11 Sickenger, from WSPA, Chung Lui, from South Coast, Bonnie 12 Holmes-Gen, from Sierra Club, Jed Mandel, from EMA, Allen 13 Schaffer, from American Trucking Association, Todd Campbell, 14 from the Coalition for Clean Air and Janet Hathaway, if I 15 could get you to kind of cue up. 16 Bruce, if you would wave to them and let them know 17 they can have a seat up front. Stand up, Bruce, maybe they 18 can see you better. 19 If you come towards Bruce, he will give up his 20 seat, voluntarily, and we will get you up front so we can cue 21 right up. 22 Good morning, Kelly. 23 MR. JENSEN: Good morning, Chairman Dunlap, and 24 Members of the Board. Kelly Jensen, on behalf of the 25 California Chamber of Commerce, and also representing the PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 25 1 Californian's for a Sound Fuel Strategy, which is a 2 broad-based coalition compromised with 25 business 3 organizations and labor organizations throughout the State. 4 We are very supportive of the changes that have 5 been made to the Resolution. We believe that it allows the 6 good parts to move forward, that would be the risk assessment 7 and the risk management phase, to move forward, but provides 8 some insulation to industry from litigation. 9 We believe that this needs to be regulated in the 10 right place at the local air districts and here at the State 11 Board, and not by individual courts up and down the State, 12 which could cripple commerce and clearly impact movement of 13 goods throughout the State. 14 So we thank you very much for those changes. We do 15 thank the Board staff. They had a very open door policy with 16 our Coalition and the Chamber, and it was a pleasure working 17 with all of you. 18 Thank you, very much. 19 CHAIRMAN DUNLAP: Thank you, Mr. Jensen. 20 I appreciate that. 21 Any questions for the witness? 22 Mr. Sickenger, from WSPA. 23 Good morning, Jeff. 24 MR. SICKENGER: Mr. Chairman, Members of the Board. 25 My name is Jeff Sickenger, and I am representing the Western PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 26 1 States Petroleum Association. 2 I would like to begin by briefly underscoring the 3 Chamber's comments. In addition to a number of technical 4 issues WSPA has raised in the past with staff and before the 5 Board, our key concerns were directed of the listing of whole 6 diesel exhaust and the indirect effect, as Kelly articulated, 7 that the listing and the acceptance of the various technical 8 documents that are a part of the proceedings potentially 9 could have on litigation, permitting and on other 10 environmental programs. 11 We believe that the Resolution that you have before 12 you today considers these concerns and addresses them in a 13 very fair and reasonable way, and we appreciate being part of 14 the process to bring that before you. 15 We are prepared to commit resources, to working 16 with staff and with the Board over the next several months to 17 help better characterize the emissions and health impacts 18 associated with use of today's fuels and engine technologies. 19 In that regard, we urge ARB to proceed with the 20 next generation of the research work and to consider 21 participating in some research that we understand is being 22 planned by Dr. Joe Motterly at the Lovelace Institute along 23 the same lines, and we also commit to work with you in the 24 risk management phase of the process that will result from 25 this listing, and to work with staff and the districts, PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 27 1 again, to help develop guidelines that will be used by the 2 districts, and with permit riders specifically, to deal with 3 issues related to diesel exhaust exposures. 4 Thanks again for the opportunity again to address 5 you this morning. 6 CHAIRMAN DUNLAP: I also want to acknowledge, for 7 those that maybe haven't been tracking the issue as closely 8 as other's might, WSPA has been a partner working with this 9 Board in the fuels area in making cleaner and better fuels, 10 and we need that to continue, certainly in the risk 11 management phase, so I want to acknowledge that. 12 Thank you, Chuck. 13 Any questions of the witness? 14 Very good. Chung Lui, from South Coast. 15 Chung, it is my understanding that you have some 16 written testimony, which we have up here. 17 DR. LUI: I'll be brief. Mr. Chairman, Members of 18 the Board, good morning. 19 For the record, my name is Chung Lui. I am 20 Assistant Executive Officer with the South Coast Air Quality 21 Management District. 22 I'm here to convey our Agency's position on the 23 issue of listing diesel related emission as a toxic air 24 contaminant. 25 Our Governing Board believes firmly that if the PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 28 1 scientific data demonstrates that diesel, whether it is 2 exhaust, or fuel, or particulates, meets the criteria of a 3 toxic air contaminant, that the Air Resources Board should 4 make such a designation. 5 In addition, our Governing Board for many years has 6 expressed concerns regarding both the toxic and the criteria 7 pollutant effects of diesel related emissions. 8 Further, our Board has adopted many policy 9 statements calling for the control of pollutant emissions 10 from diesel fuel use. 11 Therefore, in evaluating the extent of risk posed 12 by diesel related emissions, one has to consider not only the 13 cancer risk, but also the noncancer effects and additional 14 mortality risks associated with diesel in any particulate 15 pollution levels. 16 In closing, the South Coast AQMD is supportive of 17 ARB's effort to formally list diesel related emissions as a 18 toxic air contaminant. 19 I should add also that the District is looking 20 forward to working with ARB and others on the development of 21 the risk management guidelines. 22 I also congratulate the ARB staff's efforts on 23 this. 24 Thank you. 25 CHAIRMAN DUNLAP: Thank you, Dr. Lui. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 29 1 Any questions of the witness? 2 Thank you. Bonnie Holmes-Gen, from Sierra Club, 3 followed by Jed Mandel and Allen Schaffer. 4 Good morning, Bonnie. 5 MS. HOLMES-GEN: Good morning. Bonnie Holmes-Gen, 6 with Sierra Club California. 7 We are here also today to strongly urge you to 8 complete this lengthy nine-year process and to move ahead and 9 to list diesel emissions as a toxic air contaminant. 10 We believe that taking this action and formally 11 recognize the scientific findings is an important step right 12 now to move us ahead to reducing public exposure to diesel 13 exhaust. 14 We want to say that we believe this is an action 15 that is not just significant on the State level, but this is 16 a nationally historic decision. 17 We hope that it will precipitate a change in focus 18 at the national level also for research and regulatory 19 controls now that we know that diesel exhaust is not just a 20 source and criteria of pollutants, such as nitrogen oxide is, 21 and fine particulates. 22 Now we know that diesel is also a toxic air 23 contaminant and causes significant lung damage, including 24 cancer. 25 The findings today should spur us to aggressively PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 30 1 pursue cleaner technologies and alternative fuels at the 2 State and national levels. 3 We plan to be a part of this effort. We need to 4 pursue cleaner diesel fuel on a Federal level as a first 5 step. 6 We are obviously all concerned about the trucks 7 that come in and out of California, and they are operating on 8 fuels from out of State, and we need to have a single 9 national fuel that is a cleaner fuel. 10 We hope that this action today by the Air Board 11 will change the tunnel vision of agencies like the Department 12 of Energy, which, from our perspective, has been wrongly 13 focused on diesel as a solution to global warming and energy 14 efficiency. 15 We need to change the focus of the Department of 16 Energy to be focusing on alternative fuels not on diesel. 17 This is a beginning of a long process, and we, too, 18 plan to be part of that process to look at the range of 19 measures to reduce diesel pollution. 20 We believe that conversions to cleaner fuels, 21 cleaner alternative fuels, should be one of the measures and 22 guidelines, a key measure, and we are continuing to support 23 Legislation and proposals to provide incentives to truck 24 owners to help them convert to cleaner equipment and fuels, 25 and we believe that needs to be part of the solution. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 31 1 All of this discussion cannot occur until you 2 complete the listing process. We urge you to complete this 3 process to do your job to protect public health. 4 You know that the public is behind you. You know 5 that the science is behind you, and we urge to you to 6 complete the process and declare particulates from diesel 7 fueled engines a toxic air contaminant. 8 CHAIRMAN DUNLAP: Very good. Thank you. 9 I appreciate your role, too, Bonnie, in being 10 involved with working this out, too. So, that is important. 11 Any questions of Ms. Holmes? 12 All right. Very good. 13 Thank you. 14 Jed, good to see you. 15 We have your testimony here. It's well crafted. 16 I have had a chance to read it. 17 Anything you want to add to it? 18 MR. MANDEL: I was going to present it to you with 19 hand gestures. 20 CHAIRMAN DUNLAP: Okay. If you must. 21 MR. MANDEL: Good morning, Mr. Chairman, nice to 22 see you again, and Members of the Board. I'm Jed Mandel, 23 speaking on behalf of the Engine Manufacturers Association. 24 Last month, the Board decided to defer action until 25 today on the proposal to list diesel exhaust as a TAC. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 32 1 The Board decided to keep the hearing record open, 2 and it directed the staff to consider not only the extensive 3 comments that were presented to the Board, but also the 4 testimony that was presented at the Senator Kopp's August 5 fourth Legislative hearing. 6 The additional month allowed the staff and other 7 interested parties an opportunity to further consider the 8 important issues that have been raised. 9 For example, we have expressed concern that a TAC 10 listing of whole diesel exhaust, a nonspecific, 11 unidentifiable, uncontrollable substance that has and will 12 always exist as a byproduct of diesel fueled engine 13 combustion, would not be good public policy. 14 Such a listing would provide no help in identifying 15 what specific constituent of diesel exhaust might cause 16 adverse health effects and would provide no guidance as to 17 what specific constituent of diesel exhaust, if any, should 18 be reduced to protect public health. 19 The staff has listened to those concerns, and we 20 appreciate their efforts. If the proposed listing on 21 particulate matter from a diesel fueled engine is a specific, 22 identifiable and controllable substance, indeed it already 23 has been highly regulated by this Board in the form of new 24 engine emission standards and diesel fuel specifications. 25 Any other potentially harmful substances discussed PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 33 1 in the OEHHA and SRP reports are organic compounds, which 2 have been and continue to be controlled and reduced by this 3 Board's regulation of hydrocarbon emissions. 4 The knowledge base on the health effects associated 5 with diesel fueled engines, indeed of all combustion sources, 6 continues to expand and develop. 7 The conclusions that can be drawn from that data 8 continue to be refined. We think that process must continue, 9 and as such, we really appreciate and applaud the staff's 10 recommendation to closely follow health studies with respect 11 to diesel fueled engines. 12 As we hope you appreciate, questions remain 13 unanswered and uncertainties still exist with respect to the 14 conclusions concerning health risk assessment. 15 The written comments regarding those uncertainties 16 remain part of this record. It is imperative to further 17 understand, refine and reassess the quantifications of such 18 health risks in response to new data. 19 Meanwhile, we are committed to working with you and 20 the staff to address what additional controls, if any, might 21 be warranted as a result of today's action by the Board. 22 For over 20 years, we have been corroborating with 23 ARB to reduce emissions from diesel fueled engines. We are 24 not about to stop now. 25 If you have any questions, I will be pleased to PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 34 1 answer them. 2 Thank you. 3 CHAIRMAN DUNLAP: Thank you. I appreciate that. 4 I also, again, want to acknowledge your role in 5 demystifying this process as it relates to the engine 6 technology and what is coming, and that has been very 7 important. 8 Any questions for Jed? 9 Very good. Thank you. 10 Allen Schaffer, American Trucking Association. 11 Allen, good of you to come out and join us. 12 MR. SCHAFFER: Thanks very much, Mr. Chairman, 13 Members of the Board. I will be brief this morning. 14 I do not have a written statement. My name is 15 Allen Schaffer, and I am Vice President of Environmental and 16 Highway Policy of the American Trucking Association. 17 We represent trucking companies nationwide, around 18 35,000, all of which have some form of diesel equipment in 19 their operations. 20 I want to commend the Board and the staff of the 21 ARB for the important progress made here in the last 30 days. 22 We are very encouraged by the proposed Resolution 23 and the staff report. We want to thank you all for listening 24 to us and our concerns. 25 We think it validates the work and comments that we PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 35 1 have made over the last few years, and it is a reasonable 2 compromise for us all, protecting public health and setting 3 an agenda for us to move forward and address what we believe 4 are the concerns of the citizens of California, and also to 5 allow diesel users to continue to meet the needs of the 6 economy of California. 7 We are also committed to working with you all in 8 the next phase of the process, the risk management phase, and 9 we are prepared to engage and address the issues about a 10 national fuel standard and to do more on our part to help 11 reduce in-use emissions, smoke emissions from trucks 12 nationwide. 13 Thank you, very much. 14 CHAIRMAN DUNLAP: I can assure you we will be in 15 tough on that national fuel strategy, so we will work with 16 them on that. 17 MR. SCHAFFER: Undoubtedly. 18 CHAIRMAN DUNLAP: Okay. Thank you. 19 Any questions of Mr. Schaffer before he runs off? 20 All right. Very good. 21 Todd Campbell, from the Coalition for Clean Air, 22 Janet Hathaway, and a new witness, Stephanie Williams, from 23 CTA. 24 If I could get you to cue up, we will get you up 25 here. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 36 1 MR. CAMPBELL: Good morning, Chairman Dunlap, 2 Members of the Board, my name is Todd Campbell. 3 I represent the Coalition for Clean Air, not for 4 profit, dedicated to restoring healthful air to California. 5 We are here today to show our strong support for 6 this listing. The scientific evidence is clear. 7 After nine years of rigorous research and public 8 participation, and with similar findings from international 9 and national health organizations, it is time for California 10 to move ahead with this listing, and the Coalition looks 11 forward to working with the interested parties in the risk 12 reduction phase. 13 We agree with the Sierra Club that this is a very 14 historic decision, or it will be, and we urge this Board to 15 do the right thing for the public health of all of 16 Californians. 17 Thank you. 18 CHAIRMAN DUNLAP: Very good. 19 Any questions for Mr. Campbell? 20 It appears that we will be seeing you from time to 21 time. 22 You were here, what, last month was your maiden 23 voyage with us, right? 24 MR. CAMPBELL: Yes. 25 CHAIRMAN DUNLAP: Welcome. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 37 1 Janet Hathaway, who knows the way to Sacramento 2 from the Bay Area. 3 MS. HATHAWAY: Mr. Chairman, Members of the Board, 4 I'm Janet Hathaway -- excuse me, I'm an attorney with the 5 Natural Resources Defense Council. 6 I just want to take this moment to congratulate the 7 staff of ARB, who has worked so very diligently on this 8 issue, the OEHHA staff, and most particularly, the Scientific 9 Review Panel, which, I think, really is second to no 10 scientific body in terms of their rigor and their effort to 11 really ensure that health protection is primary here. 12 I just also want to thank the various participants 13 in discussions about trying to ensure that there is no 14 compromise of public health protection here, and at the same 15 time that the emphasis is placed where the science suggests 16 that it must be placed, on the vapor phase constituents and 17 particles from diesel. 18 I do think this is a truly historic moment for 19 California, and really, it will be looked at nationally and 20 internationally. 21 Making progress and reducing risk from diesel will 22 protect a large number of people, and I think that your 23 efforts on behalf of those folks really need to be applauded. 24 So, thank you very much, and I hope to work with 25 you on risk reduction measures. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 38 1 CHAIRMAN DUNLAP: Very good. Thank you. 2 We have some water for you, Janet, after the fact. 3 Stephanie Williams, you are our final speaker on this Item. 4 MS. WILLIAMS: I thank the Board, and I tell you 5 that you we appreciate your recognizing our industry's 6 concerns. 7 We want to work together to move to get some of the 8 older vehicles off the road and start immediately with the 9 public health protection, and with the Coalition that will -- 10 coming together on the science. 11 We think this is very positive and appreciate you 12 working on this. 13 CHAIRMAN DUNLAP: Very good. Thank you. 14 Is there any other, not that I'm looking for any 15 necessarily, is there anyone else that wishes to speak on 16 this Item? 17 Ms. Hutchens, has anyone seen you? 18 MS. HUTCHENS: No. 19 CHAIRMAN DUNLAP: All right. Very good. 20 What we will do then is we will conclude the public 21 testimony, and then, Dr. Friedman, I will come to you in just 22 a second. 23 We, staff, I know you received some mail. I have 24 gotten some myself. 25 Do you want to take a few minutes and go through PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 39 1 the written comments we received from them and summarize them 2 in a group, if you would. 3 MR. VENTURINI: Ms. Shiroma will do this very 4 briefly, Mr. Chairman. 5 MS. SHIROMA: Yes, thank you. 6 Twenty-five letters were received prior to the July 7 thirtieth hearing from stakeholders who did not give oral 8 testimony, and no new issues were raised in these letters. 9 Since July thirtieth, we received 23 letters and 10 numerous phone calls. Again, no new issues were raised. 11 Twenty-one of the letters were expressions of 12 support, and all of the phone calls were of support. 13 CHAIRMAN DUNLAP: All right. Very good. 14 So, we will, Mr. Scheible, before I go to Dr. 15 Friedman, is there anything that you wanted to add to this? 16 MR. SCHEIBLE: No. 17 It seems like there is a consensus of the staff, 18 and we recommend that you act to identify particulate 19 emissions from diesel fueled engines as a toxic air 20 contaminant. 21 CHAIRMAN DUNLAP: All right. Very good. 22 Dr. Friedman, thanks for your patience. 23 BOARD MEMBER FRIEDMAN: Yeah, I just wanted to move 24 approval of Resolution 98-35, which does exactly what 25 Mr. Scheible just mentioned, and also includes the notion of PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 40 1 a working group, a management working group, to look at 2 health information and also do that stationary source risk 3 management guideline. 4 BOARD MEMBER ROBERTS: Second. 5 CHAIRMAN DUNLAP: All right. Great, and there is a 6 second by Supervisor Roberts, but let's put that on hold for 7 just a moment. 8 Let me do a little bit of housekeeping here, or 9 Ms. Walsh is going to jump on me. We need to officially 10 close the record, and I'll do that now. 11 However, the record will be reopened when the 12 15-day notice of public availability is issued. Written or 13 oral comments received after this hearing date but before the 14 15-day notice is issued will not be accepted as part of the 15 official record on this Agenda Item. 16 When the record is reopened for a 15-day comment 17 period, the public may submit written comments on the 18 proposed changes, which will be considered and responded to 19 in the final statement of reasons for the regulation. 20 All right. Just as a remainder, again, to the 21 Board of our policy concerning ex parte communications, while 22 we may, of course, communicate off the record with outside 23 persons regarding Board rulemaking, we must disclose the 24 names of our contacts and the nature of the contents of the 25 discussion on the record. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 41 1 This requirement applies specifically to 2 communications which take place after notice of a Board 3 hearing has been published. 4 Are there any communications which need to be 5 disclosed? 6 I know that I have a few. 7 BOARD MEMBER PATRICK: Yes, Mr. Chairman. 8 CHAIRMAN DUNLAP: Supervisor Patrick, if I might, I 9 will come to you in just a moment. 10 I will start over here with Ron. 11 Ron, do you have any? 12 BOARD MEMBER ROBERTS: No, I don't. 13 CHAIRMAN DUNLAP: Okay. Supervisor Patrick. 14 BOARD MEMBER PATRICK: Yes. 15 After the San Joaquin Valley Air District meeting, 16 I was double-teamed by Les Clark and Manny Cunia, as only Les 17 Clark and Manny Cunia can double team someone. 18 I don't see them here today, but I would certainly 19 say that to their face as well. 20 They brought some concerns to me. This was prior 21 to the discussion of some kind of a resolution, or compromise 22 on this issue. Their concerns were about the expansion of 23 the toxic hot spots area because of this, and also concern 24 about cancer clusters in the San Joaquin Valley that someone 25 could say was because of diesel fuel as opposed to some of PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 42 1 the things that have been explored by EPA and also just 2 vulnerability of government in general, you know, school 3 districts and so forth, because of school buses, and so 4 forth, so that was the essence of their comments. 5 CHAIRMAN DUNLAP: Thank you. 6 Dr. Friedman. 7 Okay. Mr. Calhoun. 8 Mrs. Riordan. 9 BOARD MEMBER RIORDAN: Yes. 10 One person that I spoke to over the phone prior to 11 the July meeting, Gene Caluso, who heads Riverside Cement's 12 Environmental Department, spoke to me basically with nothing 13 other than what was in the testimony of the Trucking 14 Association, just questions and nothing that would be 15 different from any testimony that was held during that July 16 meeting. 17 CHAIRMAN DUNLAP: All right. 18 Mr. Parnell. 19 BOARD MEMBER PARNELL: Yes. 20 I was contacted by members of the Engine 21 Manufacturers Association, the California Chamber of 22 Commerce, the California Farm Bureau and WSPA. 23 The concerns were range of risk and the general 24 tone of the debate as it has been aired, last hearing, not 25 this hearing. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 43 1 CHAIRMAN DUNLAP: Very good. Thank you. 2 Ms. Rakow. 3 BOARD MEMBER RAKOW: No contacts. 4 CHAIRMAN DUNLAP: Mark. 5 BOARD MEMBER DeSAULNIER: No. 6 CHAIRMAN DUNLAP: Okay. I have a few. 7 Now bear with me. There are more than a few. 8 I had a meeting with Jack Coffee, from Chevron, on 9 July second; Kelly Jensen, from California Chamber, on July 10 fourteenth; Bob Welp, on July fifteenth, of the California 11 Environmental Association; Ken Churchill, of UPS, on the 12 thirteenth of July; Joe Anderson, of CTA, on the fifteenth of 13 July; Michael Rush, of the Railroad Association, on the 14 fifteenth of July; Kirk Markwold, of California Environmental 15 Associates, on the same date; Mr. Caldera and Mr. Levenson, 16 of the U.S. Postal Service, on the twentieth of July; Paul 17 Curry and Alva Cooper, both of the State Sheriff's 18 Association, on the twenty-second of July; Jed Mandel, on the 19 twenty-eighth of July; Allen Zarenberg, on the twenty-ninth 20 of July; Dwayne Morbick, Anne Farmer, Clark Rigley of Costco, 21 on the thirteenth of August; Candice Trigger, of UPS, on the 22 twentieth of August; Kent Stoddard, Waste Management, on the 23 twentieth of August; Susan Allen, of CNF, on the twentieth of 24 August; Karen Rasmussen, of Ryder, in that same period; Jean 25 Urban, of Nielsen Merksmer, also on the twentieth of August; PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 44 1 all dealing with the issue, as Mr. Parnell has cited, that 2 the breadth of the identification, also industry concerns. 3 I believe also there is another with Tim 4 Carmichael, of the Coalition for Clean Air, I believe on the 5 thirtieth of July. 6 Okay. With that, we have, let me say a word or two, 7 first of all, we have heard it said several times that this 8 discussion today, in how far we have come from last month to 9 this month has been kind of, I believe, nothing short of 10 remarkable. 11 The stakeholders have worked together. Dr. 12 Froines, his colleagues at the SRP also played a very 13 important role in listening and discussing some of these 14 issues. 15 Our staff, Mike Kenny, who is not with us, who is 16 on a vacation, a well-deserved vacation, who did an awful 17 lot, the stakeholders, the environmental community, in 18 particular, I think, took a very reasoned approach in 19 discussing this, and this represents, I think, what's best 20 about working in government, when it comes together, and 21 people feel that they got a chance to be heard and to touch 22 this issue, and that's happened today. 23 It is our job to, obviously, make sense of all of 24 the information that we received on this, and I think we have 25 done that here, but it has not just been this Board. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 45 1 It's been those that have participated. So, I want 2 to commend everybody that has been involved. 3 Also, there have been a few trade associations. We 4 heard from Mr. Jensen, from the California Chamber today, 5 they got involved and tried to get their arms around some of 6 the advocacy that has gone on and that made an important 7 difference, and I wanted to acknowledge that. 8 There are very effective ways for trade 9 associations to tackle issues, and I think if they can do it 10 in a coordinated fashion and speak as best they can with one 11 voice, it can really make a difference, and I want to 12 certainly recognize that. 13 So, with that, I would share Dr. Friedman and 14 Supervisor Roberts' recommendation that we accept the 15 modified staff proposal as it stands before us to identify 16 particulate emissions from diesel fueled engines as a toxic 17 air contaminant, and then initiate the risk assessment phase. 18 So, we have a motion to adopt the Resolution before 19 us. 20 Is there any discussion further that we need to 21 have on it? 22 Yes. Ms. Rakow. 23 BOARD MEMBER RAKOW: One quick comment. One of the 24 speakers used the word, compromise, and I don't look on this 25 as a compromise at all. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 46 1 I think it is a very rationale solution to put the 2 public health interest of the State of California into effect 3 immediately, so that the risk management process can start 4 right away instead of years of bickering and fighting over 5 the issue in the future. 6 CHAIRMAN DUNLAP: Yeah. Thank you. 7 Mr. Calhoun. 8 BOARD MEMBER CALHOUN: Mr. Chairman, I intend to 9 support the staff recommendation. 10 One of the reasons why I say that is because of the 11 fact that the initial staff recommendation of designating the 12 whole diesel exhaust as a toxic air contaminant was very 13 troubling to me. 14 Prior to this time, I think every proposal that 15 came from the staff for designation of a compound as a toxic 16 air contaminant was very specific. 17 I could not sleep at night thinking about 18 designating all of the diesel exhaust as a toxic air 19 contaminant. 20 Now, having said that, I have attended some of the 21 hearings where all of the technical discussions were held 22 regarding diesel exhaust, and, in fact, everyone in this room 23 has probably heard something about diesel exhaust, that it is 24 toxic in our lifetime, but what the staff has recommended 25 today is more in keeping with what I think should be done. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 47 1 In addition to that, the Engine Manufacturers 2 Association has mentioned, Jed Mandel mentioned, in fact, 3 that there are controls already in place now, and you will 4 see more of these in the future, and so they are already 5 addressing the problem. 6 So, as I said, I want to support the staff's 7 recommendation. 8 CHAIRMAN DUNLAP: Thank you, Mr. Calhoun. 9 Okay. It is very fitting that we had Dr. Friedman 10 make that motion to adopt that Resolution 98-35, being that 11 he has been very involved with this issue, looking very 12 closely at the science, and so I am pleased that he made the 13 motion. 14 We have a second from Supervisor Roberts. 15 Any further discussion? 16 Okay. If not, we will proceed with a voice vote. 17 All those in favor of approving Resolution 98-35, 18 identifying the particulate portion of diesel exhaust as a 19 toxic air contaminant, please say aye. 20 Any opposed? 21 Very good. The motion carries unanimously. 22 Thank you. All right. 23 We will allow for turmoil in the hearing room 24 while people change places. 25 All right. We will allow for a little bit of PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 48 1 turmoil in the hearing room while people change places. 2 We will ask the staff involved with the next Item 3 to please come forward and take their spots. I need quiet in 4 the hearing room. 5 There is cause for a lot of celebration, but if you 6 could do it in the hallway, we will continue with the next 7 Item. 8 The next Item on the Agenda is 98-9-1, a Public 9 Meeting to Consider Approval of the Triennial Progress Report 10 and Plan Revisions under the California Clean Air Act. 11 This Item is the consideration of the approval of 12 the triennial progress reports and plan revisions submitted 13 by the local air districts. 14 Although much of what we do as a Board is driven by 15 the Federal Clean Air Act, it is important to remember that 16 the Board has responsibilities under the Act, as well, 17 including the review and approval of district plans and plan 18 updates. 19 Earlier this year, the Board considered the South 20 Coast Triennial Plan Revision and Progress Report. Today we 21 will consider the triennial updates submitted by 17 other 22 districts. 23 Please, if I could have some quiet. 24 At this point, I would like to ask Ms. Terry to 25 introduce this Item. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 49 1 Lynn, the time is yours. 2 MS. TERRY: Thank you, Chairman Dunlap. 3 Air quality is an important exercise that 4 identifies the strategies needed to ensure steady progress 5 towards attainment of health based air quality standards. 6 The Federal Clean Air Act Amendments of 1990 and 7 the 1988 California Clean Air Act lay the foundation for our 8 current air quality planning efforts in California. 9 In most cases, the fundamental planning 10 requirements of the two Acts are aligned. The districts have 11 a single plan that addresses both requirements. 12 However, one difference is that the California 13 requirement is that districts review their plan every three 14 years. 15 The most recent of these triennial updates were due 16 at the end of 1997. 17 Another difference between the planning 18 requirements of the two Acts is the annual emission reduction 19 requirement. 20 The Federal Act requires a three percent per year 21 reduction in VOC, while the California Act requires a five 22 percent per year reduction in all nonattainment pollutants or 23 their precursors. 24 If the five percent reduction is not achievable, 25 then every feasible measure must be implemented. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 50 1 When the local districts plans were first approved 2 by the Board in 1992, these approvals were based on the 3 criteria of every feasible measure for the purposes of 4 meeting the Act's progress requirement. 5 Thus, the emphasis of staff's review has been 6 whether or not the local plans continue to meet the every 7 feasible measure criteria in this planning cycle. 8 Seventeen districts submitted Triennial Progress 9 Reports and Plan Revisions. The San Joaquin Valley District 10 is in a process of preparing their Triennial Progress Report 11 and Plan Revision, and you will have an opportunity to 12 consider that update at a future Board hearing. 13 I will now ask Ms. Peggy Taricco, of the Office of 14 Air Quality and Transportation Planning, to begin the staff 15 presentation. 16 MS. TARICCO: In our presentation today, we will 17 provide you with an overview of the air quality planning, how 18 we have worked to integrate the Federal and State planning 19 processes, as well as the requirement for triennial reports 20 that are in the California Clean Air Act that have brought us 21 here today. 22 This will be followed by a discussion on our 23 evaluation of the triennial reports and our recommendations 24 for Board action. 25 Air quality plans identify the control strategies PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 51 1 that are implemented to continue progress towards meeting the 2 health based air quality standards. 3 They are based on the best data available, 4 including monitoring data, emissions inventory and air 5 quality models. 6 Plans also address all the diverse emission sources 7 in a given area and are necessarily dynamic. 8 Air quality planners must periodically update plans 9 to reflect new information and continually be on the look-out 10 for new strategies and new technologies that can be woven 11 into the plans to continue clean air progress. 12 Finally, plans must meet the State and Federal 13 statutory requirements of the 1988 California Clean Air Act, 14 and the 1990 amendments to the Federal Clean Air Act. 15 These two Acts lay the foundation for our current 16 planning efforts. The California Clean Air Act requires 17 districts to develop plans to attain the State Ambient Air 18 Quality Standards. 19 It also requires that these plans demonstrate 20 annual emission reductions of at least five percent for each 21 nonattainment pollutant, or commit to adopt every feasible 22 measure. 23 Districts are also required to submit triennial 24 progress reports and any plan revisions to the ARB. 25 As Ms. Terry mentioned, the initial California PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 52 1 Clean Air Act plans were prepared in 1991. This was a 2 significant undertaking and identified the control strategies 3 that would be implemented to meet progress towards meeting 4 the State Ambient Air Quality Standards. 5 These plans were also designed to meet the 6 fundamental performance requirement to achieve a five percent 7 annual reduction in emissions of each nonattainment 8 pollutant, or its precursors. 9 The 1990 amendments to the Federal Act were the 10 primary driving force for the 1994 planning cycle, which 11 resulted in the State Implementation Plan for Ozone, or the 12 SIP. 13 While there are some differences in requirements 14 under the State and Federal plans for the areas that were 15 subject to both the State and Federal planning requirements, 16 the 1991 California Act plans formed the foundation for the 17 SIP and, with some modifications, were integrated with the 18 1994 Federal plans. 19 The 1994 planning event was an important 20 undertaking as the districts, the ARB and other responsible 21 agencies worked together to revamp and revise the control 22 strategy to reflect the best data available and also 23 identified the measures that would bring these areas into 24 attainment with the Federal standards and well on their way 25 to meeting the State standards. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 53 1 The most recent milestone was the preparation of 2 the 1997 triennial reports and plan revisions. The key 3 requirement related to the 1997 triennial reports and 4 revisions relates to the every feasible measure criteria of 5 the California Clean Air Act. 6 As I mentioned a moment ago, the Act allows for the 7 inclusion of every feasible measure as an alternative 8 approach when the five percent annual reduction cannot be 9 achieved. 10 In 1991, when the first plans were prepared, each 11 district plan committed to the adoption of every feasible 12 measure as no district was able to demonstrate the five 13 percent reduction. 14 The determination of feasibility takes into account 15 technology and cost effectiveness. Because technology 16 continues to advance, it's important to reassess the 17 feasibility criterion as newer technologies emerge. 18 District specific factors, such as transport, are 19 also considered to ensure that the districts strategies 20 effectively address the local emissions contribution. 21 To help the districts in their ongoing assessment 22 of technologies that offer emission reductions potential, 23 earlier this year we provided the districts with a resource 24 document that identified achievable performance standards and 25 emerging technologies for 25 stationary source categories. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 54 1 This resource document is a tool that they can use 2 then to help identify new emission reduction sources that can 3 be used to update their current and future plans to ensure 4 continued compliance with the every feasible measure mandate. 5 While in some cases the development of this 6 document coincided with the preparation of the 1997 triennial 7 reports and districts were able to update their plans based 8 on the information in the resource document, others, as we 9 will discuss later, have committed to reviewing the 10 information post submittal of their triennial reports to 11 determine if additional opportunities exist for them that 12 they can then incorporate into their rulemaking activities. 13 The next requirement we want to review pertains to 14 the triennial progress reports. The California Clean Air Act 15 requires triennial progress reports and plan reviews to 16 determine if plan revisions are necessary. 17 The first of these reports were due in 1994 and 18 coincided with the 1994 Ozone SIP. The second reports, which 19 are the subject of the Board Item today, were due in 1997. 20 The triennial reports include information on air 21 quality improvement and expected and revised emission 22 reductions for each district measure that was scheduled for 23 adoption in the preceding three-year period. 24 In addition to the progress reports, a triennial 25 plan review was also required. This process provides an PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 55 1 opportunity to incorporate new data, take advantage of new 2 technologies and revise the control strategy if necessary. 3 There are 21 areas that are required to submit 4 triennial reports. Eighteen districts have submitted their 5 updates, as shown here on this slide. 6 The South Coast plan update was considered by the 7 Board last January and was conditionally approved at that 8 time. 9 Today you are considering the 17 other triennial 10 reports. 11 Before we go on, I would also like to mention that 12 the triennial reports submitted by the Glen and El Dorado 13 districts were draft and will be considered for adoption by 14 their respective boards in the near future. 15 According to the District staff, however, they do 16 not expect the draft versions to change substantially prior 17 to their board's consideration. 18 Not all the districts were able to complete the 19 triennial reporting requirements in time for today's Board 20 hearing. 21 These were Santa Barbara, San Joaquin and Imperial 22 Districts. As you may know, the Santa Barbara County Air 23 Pollution Control District was recently bumped up by the U.S. 24 EPA from moderate to serious under the Federal Act, and as a 25 result, the District's staff are following an expedited plan PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 56 1 development schedule to enable them to submit the required 2 SIP revision later this year. 3 They have informed us that they will also be 4 meeting the California triennial reporting requirements at 5 that time as well. 6 The San Joaquin Valley Unified Air Pollution 7 Control District was also not able to complete the triennial 8 report in time for today's Board hearing. However, they are 9 currently preparing a draft triennial progress report and 10 plan to share that draft at public workshops later this 11 summer in the Valley. 12 Last, the Imperial County Air Pollution Control 13 District has not submitted an update to the 1991 Imperial 14 County Air Quality Attainment Plan. 15 Over the past several years, the District's 16 planning resources have been focused on the Federal PM 10 17 planning requirements, and in addition, the District has been 18 working closely with the ARB, U.S. EPA and Mexico to develop 19 the technical tools that will enable them to prepare a 20 regional plan that would address the international transport 21 issue. 22 In our evaluation, we focused on reviewing how the 23 districts progressed over the past three years. We reviewed 24 district rulemaking for 1995 to 1997 and compared the 25 rulemaking and emission reductions to those in the plan. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 57 1 If deficiencies were noted, we looked to see if the 2 district committed to correcting that deficiency. 3 What we found was that progress in fulfilling the 4 rulemaking commitments in the plans varied. Some districts 5 have implemented their plans on schedule, while in other 6 cases, many districts were not able to adopt all the rules 7 scheduled in the 1995 to 1997 planning cycle due to resource 8 constraints, unexpected lengthy rule adoption processes, and 9 the like. 10 For the districts that did not adopt the rules as 11 planned, the law requires that these deficiencies be 12 corrected in the next planning cycle. 13 In the 1997 plan revisions, the districts that were 14 in this situation addressed this requirement by updating the 15 rulemaking schedules to reflect their commitment to adopt the 16 necessary rules in the current planning cycle from 1998 to 17 the year 2000. 18 In assessing the adequacy of the districts 19 rulemaking commitments, we focused on the Act's every 20 feasible measure requirement. 21 As I alluded to earlier, this assessment took into 22 account districts specific factors, including the severity of 23 the air quality problem, technical feasibility and the 24 contribution of emissions transported from other regions. 25 It is also important to mention that the factors PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 58 1 related to feasibility were considered in the context of the 2 current planning cycle. 3 The triennial review requirement reflects the 4 reality that what constitutes feasible is clearly time 5 dependent and will change as technology evolves and districts 6 regulatory programs move forward. 7 Based on our review then, we found that most 8 districts continue to meet the every feasible measure 9 criterion for the current planning cycle, and that several 10 districts have committed to look for additional emission 11 reductions as well. 12 Based on our review of the district control 13 strategies, we find that for four districts, Kern County, 14 Mojave Desert, Monterey County and San Luis Obispo, the 15 strategy that is being implemented addresses the local 16 contribution to the air pollution problem for this planning 17 cycle. 18 However, these districts do need to continue to 19 track emissions from local sources, maintain effective 20 programs for new sources and reevaluate in the next planning 21 cycle whether or not additional emission reductions from 22 local sources is necessary. 23 For the other districts, shown here on this slide, 24 additional emission reductions are necessary to continue 25 clean air progress and to address the local emissions under PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 59 1 district jurisdiction in this planning cycle. 2 These districts need to complete the rulemaking 3 scheduled for this planning cycle, and in some cases, 4 evaluate whether or not there are new emission reductions 5 from local sources that they can pursue. 6 San Diego and Bay Area have already completed an 7 evaluation process in late 1997 to identify new measures for 8 consideration. 9 As a result, the San Diego District was able to 10 incorporate new commitments into their plan prior to 11 submittal to the ARB, and the Bay Area District has agreed to 12 add three measures to their rulemaking schedule. 13 For the broader Sacramento area and Ventura 14 Districts, we requested that they evaluate the information 15 from the resource document that I mentioned earlier, to 16 determine if additional emission reduction opportunities 17 exist that can then be incorporated into their rulemaking 18 schedules and to report back to us on which source categories 19 they are going to evaluate. 20 For the Northern Sacramento Valley, they need to 21 complete the rulemaking process for those measures that were 22 planned for adoption between 1995 and 1997 and not yet 23 adopted. 24 Now, air quality improvement, overall, California 25 is experiencing improved air quality. With regards to air PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 60 1 quality improvement, the California Act specifies review of 2 air quality data over the preceding three years. 3 However, it is difficult to reach any conclusions 4 based on such a short timeframe. Generally, trends are 5 evaluated over several planning cycles, say 10 to 20 years, 6 to minimize the impact that uncontrollable factors, such as 7 meteorology, may have on ozone levels in a given single year. 8 While the air quality trend is positive, it is also 9 clear that additional controls are necessary to continue 10 progress and meet the State Ozone Standard. 11 One area, the San Joaquin Valley, is of particular 12 concern because air quality is not improving as it is in 13 other areas of the State. 14 Imperial County is also showing minimal progress, 15 primarily due to international emissions and transport. 16 Based on the review of the triennial reports from 17 the 12 districts shown here on this slide, we find that the 18 reports satisfy the California Clean Air Act requirements for 19 the Triennial Progress Report and Plan Revision and are 20 recommending full approval under the California Clean Air Act 21 for these districts. 22 In the notice for this Item, you may recall that we 23 were proposing a conditional approval for the Bay Area. 24 However, we were recently able to come to agreement on the 25 three measures that were the basis for the earlier PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 61 1 conditional approval recommendation and are now able to 2 recommend full approval for the Bay Area. 3 For five districts, those in the broader Sacramento 4 area and Ventura, we are recommending conditional approval of 5 the Triennial Reports and Plan Revisions, and in each case, 6 the condition pertains to ensuring that that control strategy 7 continues to satisfy the every feasible measure requirement 8 of the Act. 9 In the case of Ventura, Sacramento and Yolo/Solano 10 Districts, the district staff have already reviewed the 25 11 stationary source categories in the resource document and 12 identified those that they will evaluate further. 13 So, the proposed condition for these districts 14 reflects their commitments and requires them to commit to a 15 schedule for consideration of new or revised rules that 16 reflect achievable performance standards for the district. 17 For the El Dorado and Placer Districts, the 18 proposed conditions requires the districts to conduct a 19 review of the 25 stationary source categories in the ARB 20 resource document provided earlier this year and identify 21 those that they will conduct further study on and then commit 22 to a schedule for consideration of new or revised rules. 23 We also recommend that the conditional approval be 24 converted to a full approval once the Executive Officer 25 determines that the conditions specified for each individual PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 62 1 district has been met. 2 For the draft plans that we reviewed, those from 3 El Dorado and the Glen Districts, there is an error there. I 4 apologize. 5 We recommend that the Board delegate the authority 6 to the Executive Officer to approve the final plans as 7 recommended by the staff, provided the final plans are not 8 substantially different than the draft plans. 9 In the case of these districts, the staff had 10 recommended conditional approval for El Dorado and full 11 approval for Glen County. 12 To sum up, we believe that the triennial reporting 13 requirements of the California Act are a useful check point 14 and provide us with an opportunity to asses how we are doing 15 and where we need to make adjustments in our plans. 16 Clearly, we have made significant progress towards 17 clean air, but we still need to be looking for additional 18 opportunities for emission reductions to continue that 19 progress. 20 Based on our review of the triennial reports 21 submitted, we are, therefore, recommending that 12 be granted 22 full approval and 5 conditional approvals. 23 That concludes our presentation today. We will be 24 happy to take any questions that you may have. 25 CHAIRMAN DUNLAP: Okay. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 63 1 Are there any questions? 2 Yes. Mr. Calhoun. 3 BOARD MEMBER CALHOUN: One, I guess I have two 4 questions. 5 One pertaining to the all feasible measures that's 6 published by EPA. Who decides what is feasible and what 7 isn't feasible? 8 MS. TARICCO: It is a district specific 9 determination, and each district needs to decide what 10 measures are going to be feasible for that district and take 11 into account many factors, as far as the technology, the 12 resources that they have, the environment. 13 We, the ARB has provided guidance on how to go 14 about that process, both in 1991, and then in the document 15 that you considered back in March, also has guidance on how 16 to determine what is going to be feasible. 17 MS. TERRY: I think, conceptually, the technical 18 assistance that ARB staff have provided or really focused on 19 two key elements of that feasibility, which is technological 20 feasibility and cost effectiveness. 21 I think the process that our staff goes through in 22 reviewing what technologies have been demonstrated, what 23 rules on the books throughout California and, in fact, other 24 states in some cases, form the baseline for that assessment. 25 So, we basically look at what has been done out PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 64 1 there and achieved, what new technologies are on the horizon, 2 so there are two elements in the resource document, what is 3 clearly demonstrated today, as well as what we envision, 4 perhaps in the next planning cycle. 5 So, again, it is an ongoing in terms of reviewing 6 the technology and the cost effectiveness. 7 BOARD MEMBER CALHOUN: My next question pertains to 8 conditional approval. 9 You recommended that we grant conditional approval 10 to several districts. How long will that condition last? 11 Three years from now will we be reviewing the 12 conditional approval? 13 What is the check in order to make sure that 14 something happens? 15 MS. TERRY: Well, I suggest that the check would be 16 for the Executive Officer to report back to the Board in 17 short order in terms of the progress that districts have made 18 in their evaluations. 19 The positive is that districts have sent us letters 20 outlining their commitment to review the resource document, 21 in the case of the broader Sacramento Air District, some of 22 them, for example, and so within the next couple of months, 23 we would expect them to complete that process. 24 Also, several of the districts have already 25 outlined a tentative rulemaking schedule for some additional PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 65 1 measures, and so, once those commitments go into the 2 rulemaking calendar, then in our view, we consider that to be 3 the condition being met, and we would recommend that the 4 Executive Officer convert the approval. 5 BOARD MEMBER CALHOUN: Do you think it would be 6 appropriate to have the staff come back to the Board, or at 7 least something, to let us know that the conditional approval 8 that were granted have been, conditions have been removed, or 9 something? 10 MS. TERRY: Absolutely. 11 I think it is very important for the Board to be 12 updated on the progress that is being made, because after 13 all, that is the ultimate goal of the plan, is to see the 14 reductions achieved. 15 CHAIRMAN DUNLAP: Supervisor Patrick. 16 BOARD MEMBER PATRICK: Really, my questions are 17 more about the San Joaquin Valley plan that is not before us 18 today than anything else, and I'm concerned about the status 19 plan, and do you feel that we are truly on target for going 20 to public hearing late this summer, I mean, it is already 21 late this summer, and for adoption in the fall? 22 We have got a couple of people representing the 23 District, but I would like to hear what you folks have to say 24 about that. 25 The progress on the rule development on these 25 PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 66 1 stationary sources that we adopted plans for in March, and 2 also, just your response in general to concern about the lack 3 of progress in the San Joaquin Valley, and what is that going 4 to mean for the San Joaquin Valley when we move from serious 5 to severe next year? 6 MS. TERRY: Well, we will start with the status of 7 the District's effort to comply with the triennial progress 8 requirements. 9 CHAIRMAN DUNLAP: Start with the third question. 10 MS. TERRY: Oh, you would rather start with the 11 third one? 12 Okay. 13 BOARD MEMBER PATRICK: I didn't mean to give you so 14 many, Lynn. 15 I mean, she's smart enough to remember them. 16 CHAIRMAN DUNLAP: I just felt the press thing -- 17 BOARD MEMBER PATRICK: We will see how she answers 18 it, because I will be asked it, I'm sure, as well. 19 This is really important stuff, and I'm just real 20 concerned that we are not on target for doing what we need to 21 be doing. 22 MS. TERRY: Well, I think actually the three 23 questions are very closely linked, so I can manage them. 24 The District had sent us a letter outlining their 25 timeframe for doing the review of the 25 categories in our PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 67 1 resource document. 2 So, we really appreciate that commitment on their 3 behalf. They have outlined, essentially close to a year to 4 do that process, the commitment is, I believe, by July of 5 1999, that would be complete. 6 That is a fair amount of time, but I think given, 7 you know, the concern about progress in the Valley, it is 8 better to take the time to do a very thorough job, and that 9 ARB staff, I think, really is -- needs to be involved in that 10 process. 11 It is a tough challenge in the Valley, so we are 12 committed to working through those issues with the technical 13 staff at the District to make sure that it is a very thorough 14 review of the existing sources that are out there. 15 That timing, I think, works in the sense of what 16 you pointed out, a possible planning process relative to the 17 Federal standard next year. 18 They are -- the attainment date and the current SIP 19 for the San Joaquin Valley is July of 1999. It is clear from 20 what has happened in the last few years in terms of air 21 quality that we are not going to get there. 22 I think this review process from the stationary 23 source side will compliment very nicely what ARB staff will 24 be doing to look at the impacts of our control programs that 25 are in the works, as we speak, and hopefully completed by end PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 68 1 of this year. 2 So, we will be looking at the State element, the 3 mobile sources, and include the stationary sources as well. 4 So, they are closely linked, I think, that 5 commitment to do the work in terms of the State standard is 6 the very same work that needs to be done in terms of 7 addressing the Federal issue. 8 CHAIRMAN DUNLAP: Does that do it, Supervisor 9 Patrick? 10 BOARD MEMBER PATRICK: Yes, it does. 11 Thank you. 12 CHAIRMAN DUNLAP: Dr. Friedman. 13 BOARD MEMBER FRIEDMAN: Well, I just want to 14 revisit Joe Calhoun's question and your response. 15 We are not grandfathering, I hope, a sort of plan 16 that forever delays by districts, at least I thought that you 17 thought that we had enough checks and balances and reviews 18 and so forth, that this won't be a perennial kind of an 19 issue, so -- 20 MS. TERRY: Exactly, and that is a very important 21 point, that this finding is a three-year window. 22 Every three years we look at what's feasible, and 23 we also at the same time are looking at what we expect to be 24 feasible, perhaps, in the next three-year window. 25 In the case of the Sacramento region, they had a PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 69 1 very aggressive regulatory agenda in the 1994 SIP, and they 2 are making good progress. 3 What we want to see is for them to complete that 4 rulemaking, as a first step, and then what we have really 5 done with this conditional approval is, say, even since 1994, 6 we think that there things that maybe they can add to their 7 rulemaking calendar, so it is continuing to press the 8 envelope on an at least every three-year basis. 9 CHAIRMAN DUNLAP: Okay. We have one witness. 10 Mark, I will let you introduce the witness. 11 BOARD MEMBER DeSAULNIER: Before Ellen comes up, 12 there are two issues in regards to the Bay Area submittal, 13 one, is from WSPA, that was submitted, an oral document, a 14 written document, I should say, and this is in regards to our 15 NOx controls. 16 In the Bay Area they are contesting that legally, 17 and Kathleen can answer any legal questions, but Kathleen, 18 Mike, and I know John has had some conversations. I was 19 designated by the Bay Area Board to try to work on an 20 alternative plan with WSPA. 21 They have submitted that and run it by the 22 Chairman, and Kathleen and Mike have seen it, but in the 23 meantime they have already gone and had a hearing date in 24 court, and we are expected to hear a decision on WSPA's 25 contention that CEQA should have been included on the NOx PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 70 1 controls, and further concluded, you can correct me when I am 2 finished, Kathleen, let me go ahead while I'm on a roll, and 3 what WSPA would like to do is to put us on after that, they 4 think that the Bay Area plan should not be approved at this 5 time because of that issue. 6 I think our Board, and Ellen can add to this, I'm 7 sure she will, would advise this Board to go ahead and accept 8 it as is, and that will play out before the end of the month, 9 because I'm told the judge is going to retire at the end of 10 the month, so he has to have something back, and then the 11 other issue is the issue that, speaking to Mike in the last 12 24 hours, and Ellen, with the three control issues, on 13 stationary sources, and I understand that we have worked out 14 language, as the report said, that is agreeable to our staff 15 to go ahead and approve it. 16 So, I would encourage the Board to approve ours, 17 and with all due respect to WSPA, suggest that we find out 18 what happens with the judge sometime before he retires. 19 MS. WALSH: Right, Supervisor DeSaulnier, and what 20 I would have said, not to correct you, because your -- 21 BOARD MEMBER DeSAULNIER: Go ahead and correct me. 22 MS. WALSH: Your summary was quite accurate, but 23 just to provide you with a little bit of legal advice, that 24 is that CEQA actually addresses this very specific situation 25 that you are faced with here where a lead agency has produced PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 71 1 CEQA documentation that's being challenged in court. 2 What CEQA says is that a responsible agency, which 3 ARB is in this case, is required to assume that that 4 documentation is adequate and to proceed ahead and take 5 action on the basis of that documentation. 6 The idea being to make sure that you have all of 7 the issues related to CEQA adequacy being handled in one 8 forum and not have a bunch of different bodies trying to take 9 action on the same issue. 10 BOARD MEMBER DeSAULNIER: And lastly, I should 11 acknowledge that Supervisor Patrick has been working, in 12 terms of the alternative plan, in regards to NOx and 13 transport, so we still may come to some alternative plan 14 around NOx. 15 CHAIRMAN DUNLAP: Okay. Go ahead, Mark, introduce 16 the witness. 17 BOARD MEMBER DeSAULNIER: I thought you were going 18 to say, and now, Ellen Garvey, but if you want me to be David 19 Letterman, I would like to introduce one of my dearest 20 friends, Ellen Garvey. 21 MS. GARVEY: Thank you, very much, Supervisor 22 DeSaulnier. 23 I don't have a top ten David Letterman type list, 24 but I do have a few comments for Chairman Dunlap and the 25 Members of the Board of Directors. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 72 1 Good morning. Thank you for the opportunity this 2 morning to provide you with some comments on the Bay Area Air 3 District's 1997 update to our Clean Air plan. 4 As I look at the Clean Air plans for California 5 that have been developed under the terms and conditions of 6 the California Clean Air Act, they are really a blueprint for 7 how to continue to control air pollution, not only throughout 8 the State, but specifically in the San Francisco Bay Area. 9 The Act provides a very ambitious but practical 10 mechanism for continuing on a step-by-step basis to improve 11 air quality in regions like the San Francisco Bay Area and 12 regions like our downwind neighbors, many of whom are 13 represented here today in the audience. 14 We have worked very consciously to make sure that 15 we are able to fulfill, we have fulfilled, all of the 16 requirements as set forth in the California Clean Air Act. 17 We have also worked diligently to meet all of the 18 deadlines for plan submittal that have been laid out in the 19 California Clean Air Act. 20 The Air District's Board of Directors adopted a 21 1997 Clean Air Plan and a triennial assessment on December 22 17, 1997. 23 We submitted the plan and the associated documents 24 to the California Air Resources Board by the prescribed 25 deadline set forth in the Act on December 31, 1997. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 73 1 Because years ago we adopted what I call, a lot of 2 the easy measures, already, we are, as ARB staff correctly 3 pointed out in their presentation, we are unable to meet the 4 five percent per year emission reduction target laid out in 5 the Act. 6 We have, however, worked diligently to identify all 7 feasible control measures and to include these control 8 measures in our plan. 9 I would like to say that ARB's review of the 10 District's draft plan has proven very, very helpful to make 11 sure that we identify all candidate control measures, and 12 that we gave all of these candidate control measures full and 13 serious consideration. 14 After submittal of the final plan to the ARB, there 15 did remain a few issues regarding the inclusion of all 16 feasible measures in our plan. 17 All of these measures have been considered and have 18 all been discussed at various levels of the staffs between 19 the two agencies, and they have all been resolved to our 20 mutual satisfaction. 21 Therefore, I believe that our plan, in combination 22 with the August twenty-fourth letter, that I believe you have 23 before you at your place, in which we commit to reexamine 24 three additional measures for nitrogen oxide controls, that 25 our plan now meets all of the requirements of State law, of PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 74 1 State regulation and of State guidance. 2 I, therefore, ask that you approve the Bay Area's 3 plan, along with our triennial assessment. If you have an 4 opportunity to read through our plan, you will see that we 5 are going to be very, very busy over the next three years. 6 Our plan sets forth a very ambitious schedule to 7 continue to implement control measures to improve air quality 8 in the San Francisco Bay Area as we move forward on our quest 9 to attain the State standard for ozone. 10 We use this State plan for resources for Federal 11 planning requirements that the District is currently 12 embarking on, and will be embarking on into the mid-term 13 future. 14 In conclusion, I am going to say that I take very 15 seriously our obligation to protect the respiratory health, 16 not only of the six and a half million people that live in 17 the San Francisco Bay Area, but also of our downwind 18 neighbors. 19 We will do everything that we can, and I will 20 commit all the resources that I can through my Agency to make 21 sure that all of these measures that have been identified in 22 the plan are adopted and implemented on an expeditious 23 schedule as possible. 24 That concludes my remarks, Mr. Chairman, and I will 25 be happy to answer any questions that you or other Board PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 75 1 Members may have. 2 CHAIRMAN DUNLAP: Any questions for Ms. Garvey? 3 Very good. Thank you. 4 You might be available, because I am going ask WSPA 5 in a minute, after Mr. Quentin comes forward, if they want to 6 say anything to help clarify this issue. 7 Kathy, I see you back there. It's an invitation, 8 not a required presence, but I will call you up after Doug, 9 if you want to say anything. 10 Mr. Quentin. 11 MR. QUENTIN: Mr. Chairman, Members of the Board. 12 I'm Douglas Quentin, Air Pollution Control Officer for the 13 Monterey Air District, and I appreciate the opportunity to 14 comment. 15 Your Board found that the North Central Coast Air 16 Basin and the Bay Area Basin were joined, forming -- the Bay 17 Area is upwind and the North Central Coast Basin is downwind. 18 We are finding, generally, in our air basin that 19 about half of our violations of the State Ozone Standard are 20 overwhelmingly the responsibility of the Bay Area transport, 21 and about half are shared responsibility of both air basins. 22 So, this issue is very important to us and to our 23 Board Members. We participated in the Bay Area plan 24 development, and we support their plan as proposed in your 25 Agenda. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 76 1 We also would urge your approval of the triennial 2 assessment for our air basin as well, and I would compliment 3 the ARB staff for working closely with us. 4 They are very professional and did a great job, and 5 that's it for me. Thank you. 6 CHAIRMAN DUNLAP: Okay. 7 Any questions of Doug? 8 All right. Very good. 9 Thank you. Kathy Reheis, of WSPA, the question 10 that I have for you, Kathy, and if you could attempt to 11 respond to would be, is there anything in the package that's 12 before us today that would preclude or serve as a problem or 13 hurdle for you all to do an alternative Bay Area NOx plan, 14 that's, I think, that is the essence of, certainly I'm 15 interested, and probably what Mark's interested in knowing? 16 MS. REHEIS: Well, since I'm not a lawyer, I'm not 17 sure on the implications of this Board's action to approve a 18 plan which is in the state of uncertainty, the litigation and 19 court case -- 20 I think the purpose for our letter and what we 21 submitted is to appraise the Board of the situation and to 22 let you know that the litigation is ongoing and that the 23 settlement discussions are continuing with the downwind 24 districts and with the ARB as directed by the Bay Area on the 25 alternative compliance plan. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 77 1 We are waiting to hear, sort of, the Bay Area's 2 view on that compliance plan, and I think they are waiting to 3 hear the court's view on the litigation before they engage 4 with that activity. 5 So, our letter is submitted for the record to 6 protect our interests in the litigation. 7 CHAIRMAN DUNLAP: Okay. Well, I mean, maybe let me 8 ask the staff this question, depending on which way the 9 litigation is dealt with, and we don't know, we can't predict 10 what the court will do, but by adopting this do you think it 11 would kill the ability to have this alternative control plan 12 approach, Kathleen? 13 MS. WALSH: Chairman Dunlap, there is nothing in a 14 decision that this Board would make today to approve the Bay 15 Area plan that would preclude future actions in response to 16 either a settlement agreement or should the judge make an 17 order that directed the District to go back and revisit their 18 plan, that would preclude that activity from going forward. 19 CHAIRMAN DUNLAP: Okay. 20 BOARD MEMBER RAKOW: But would it prejudice it? 21 MS. WALSH: No. 22 BOARD MEMBER DeSAULNIER: John, I think the answer 23 to the question is that my Board still wants to look at the 24 alternative plan, but they wanted to run a parallel course to 25 go ahead with the litigation, so depending on what happens, PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 78 1 it will obviously be different perspectives, but it's going 2 to go ahead. 3 CHAIRMAN DUNLAP: Yeah, and I think that 4 Ms. Reheis and her colleagues, they are interested in keeping 5 this thing in play to see if you can get there cheaper, 6 quicker, more efficiently, etcetera, and that is a reasoned 7 thing to try to seek. 8 I don't think it is anybody's intention to, you 9 know, kill that, or, you know, to not allow that to emerge, 10 if, in fact, people can embrace it. 11 BOARD MEMBER DeSAULNIER: I think the next step, 12 John, is really at your suggestion, is regardless of what 13 happens legally, is for the technical people with support 14 from here to the air districts to see if the alternative plan 15 can deliver what the plan was suggesting that it can. 16 MS. REHEIS: And a discussion with your legal 17 counsel, that is our understanding, as well, that there is 18 nothing that the action taken today would preclude that. 19 CHAIRMAN DUNLAP: Okay. Gotcha. 20 That answers that for me. 21 Ellen, is there anything -- did I get any of that 22 wrong, from your view? 23 Okay. All right. 24 Very good. That is end of the witnesses. 25 Thank you, Ms. Reheis. Sorry to pull you up like PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 79 1 that, but it helped. 2 Written comments? 3 Anything, Dean? 4 MR. SAITO: We just had the one comment from WSPA 5 that Supervisor DeSaulnier summarized previously. 6 CHAIRMAN DUNLAP: Okay. All right. 7 Ms. Terry, anything that you want to add? 8 MS. TERRY: Nothing else. 9 CHAIRMAN DUNLAP: Okay. If I could just say a 10 word, I will make it brief. 11 The rulemaking responsibilities that, you know, the 12 State has, and the locals have, are essential, and I want to 13 encourage everybody here representing local districts, and 14 our own staff, to make sure that we keep our eye on meeting 15 rulemaking commitments, things that are in plans should be 16 dealt with, because we need to be able to continue progress, 17 obviously, because we have a serious air quality challenge in 18 the State. 19 Also, and I have said this before, you know, we are 20 asked repeatedly to go to the Legislature and explain our 21 Program. 22 I can't tell you how many times this year we have 23 had to send our people over there to answer questions, and 24 also on occasion even have to answer questions about local 25 air districts. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 80 1 So, I want to encourage you all representing the 2 local districts, and again, our rulemaking staff, to make 3 sure that we live up to our commitments and make sure that we 4 are clear on our communications and that we understand that 5 when we've hit bumps in the road that we are going to need to 6 take a change of course, because if we don't communicate with 7 ourselves, we can't do a very good job in defending the 8 Program. 9 So, again, I just wanted to emphasize the point 10 that we need to, you know, live up to our commitments. 11 Okay. If there isn't anything else on this Item, 12 we don't have to close the record. 13 We have before us Resolution 98-36, which contains 14 the staff recommendation. 15 The Chair would entertain a motion and a second. 16 Supervisor Roberts, and a second by Mr. Parnell. 17 Any discussion that we need to have? 18 Very good. All right. 19 Then we will do a voice vote. 20 All those in favor of approving the staff 21 recommendation, Resolution 98-36, please say aye. 22 Any opposed? 23 Very good. Thank you. 24 Ms. Terry, thank you. Okay. 25 Okay. We will move to, how are we doing with time, PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 81 1 are we doing okay? 2 We will move to the next Item, Amendments to the 3 Cleaner Burning Gasoline Regulations, 98-9-2. 4 This Item is a proposal from staff to change 5 certain regulatory provisions concerning oxygen in gasoline. 6 The changes would give refiners some limited 7 additional flexibility for the amount of oxygen that may be 8 used in fuel, gasoline. 9 The Board's Reformulated Gas Program, also known as 10 Cleaner Burning Gasoline, has been extremely successful. The 11 air quality benefits of this Program are equivalent to 12 removing 3.5 million cars from our roadways. 13 Last year the staff began discussions with the 14 refining industry to see what steps could be taken to provide 15 more flexibility to refiners to manage oxygenates usage. 16 The discussions were entered into with the 17 understanding that any regulatory changes could not result in 18 a loss of air quality benefits. 19 At this point, we have before us one step in 20 providing more flexibility in the Cleaner Burning Gasoline 21 Program. 22 I understand that work will be under way to develop 23 future proposals. However, one crucial element of oxygenate 24 flexibility is not in our control. 25 The Board can provide only limited flexibility as PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 82 1 long as Federal law requires a minimum oxygen content in 2 reformulated gasoline, and severe and extreme ozone 3 nonattainment areas, even though the oxygen is not the only 4 way to the emission performance of cleaner burning gasoline. 5 For California, 70 percent of our gasoline is 6 subject to this Federal Oxygenate mandate. I believe that as 7 long as emission benefits of our Program would remain intact, 8 the Board should do what it can to enable refiners to have 9 flexibility in the use of oxygenates. 10 However, we need to recognize that the overlay of 11 Federal law on our regulations limit the practical effect of 12 anything that we may do. 13 In recognition of this, I have personally testified 14 in support of Congressman Bilbray's Legislation, HR 630, and 15 have gone on record in support of Senator Feinstein's 16 companion bill. 17 Both bills would allow California to have its own 18 program and not be subject to the Federal minimum oxygenate 19 requirement. 20 As long as California's program provides the same 21 benefits as the Federal program, I encourage all to support 22 these bills. 23 At this point, I would like to ask Mr. Scheible to 24 introduce the Item and his team. 25 Mike. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 83 1 MR. SCHEIBLE: Thank you, Mr. Chairman. 2 Earlier this year, we began an effort to bring to 3 you a number of changes to increase flexibility in the 4 Cleaner Burning Gasoline Program, quite a bit more 5 comprehensive than what we have before us today. 6 What we found out in that effort is that we were 7 limited mostly by time and events in terms of the number of 8 changes requested by the industry that we could deal with in 9 1998. This is for several factors. 10 First, the technical information available for us 11 to update the model to relate how emissions change, changes 12 in the fuel parameters, was not as broad as we wanted, and 13 the model was a very difficult thing to put together and get 14 working properly. 15 We weren't able to fully solve that to our 16 satisfaction or the satisfaction of the industry. 17 The second reason was just alluded to by the 18 Chairman, which is to gain real flexibility relative to the 19 amount of oxygen used in gasoline in California, we needed a 20 change in the Federal law, and that change, although we 21 supported it and introduced by both the Senate and the House, 22 it was not moving quickly enough, so making a change this 23 year would not have the practical benefits for the refiners. 24 Third, we have a somewhat difficult issue of 25 determining how we can ensure that we provide flexibility PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 84 1 without compromising air quality benefits, and we weren't 2 able to fully complete that work. 3 So, today we are bringing you a relatively modest 4 proposal for a couple of changes in the Cleaner Burning 5 Gasoline Regulation, but with the hope that we will continue 6 to work on this issue and will at a future date return to the 7 Board with a set of changes that will both ensure that we 8 continue the benefits of the Program and yet provide refiners 9 with the maximum flexibility that we can, to that supply, 10 price, and we get more flexibility in the future in terms of 11 how much oxygen is used and the type of that oxygenate. 12 With that, I would like to turn the presentation 13 over to staff, and Richard Vincent, of the Stationary Source 14 Division, will give the staff's presentation. 15 Thank you. 16 MR. VINCENT: Thank you, Mr. Scheible. 17 The first slide shows the structure of this talk. 18 After reviewing the factors that influence these, 19 of oxygenates and gasoline, I will present the regulatory 20 changes that we are proposing today. 21 The Board's current gasoline regulations took 22 effect in 1996. They set limits on eight gasoline properties 23 that effect emissions. 24 Those limits were selected to provide the maximum 25 reduction of emissions. The right column on this table shows PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 85 1 the cap limits, which apply to all gasoline at all points in 2 commerce. 3 These caps are fixed. They cannot be changed by 4 any means. 5 Gasoline leading refinery, or importing side, also 6 is subject to more stringent limits, which we call the flat, 7 or the averaging limits, except for RVP, those limits can be 8 adjusted, as I will explain shortly. 9 This slide shows the flat and averaging limits that 10 apply if a refiner chooses the basic compliance option. 11 Under this basic option, each batch of gasoline 12 contains 1.8 to 2.2 weight percent oxygen. The ARB does not 13 control what oxygen bearing compound can provide that oxygen. 14 The oxygen cap is now at 2.7 by weight. Like all 15 the property limits, the cap for oxygen was set in 1991, 16 before the predicted model was even developed. 17 The staff chose 2.7 for that cap because we were 18 unsure of NOx emissions and higher oxygen contents. With the 19 expectation of creating a predictive model to allow oxygen 20 contents greater that the basic limit at 2.2 percent, it was 21 still prudent to limit such higher contents to 2.7 percent. 22 To comply with respect to any of the property 23 limits, each refiner can meet the basic flat limit with each 24 batch of gasoline, or for six properties, the refiner can 25 move the basic averaging limit. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 86 1 In compliance by averaging, some batches of 2 gasoline can exceed the averaging limit if they are offset by 3 other batches that are below the limit. 4 However, no batch may exceed the associated cap 5 limit. A third alternative for refiners is to use the 6 predictive model. 7 This option was added to the regulations in 1994. 8 The model identifies alternative flat and averaging limits 9 that provide the same or greater emission benefits in 10 hydrocarbons, NOx and toxic emissions, as do the basic 11 limits. 12 Virtually all gasoline in California is now made to 13 limits set by the predictive model. Using the model allows 14 refiners to reduce compliance costs and increase their 15 production capacity for complying gasoline. 16 A particular use of the model is to set oxygen 17 limits outside the basic compliance range of 1.8 to 2.2 18 weight percent. 19 A refiner can reduce the minimum oxygen to zero, 20 except during the winter, and can increase the maximum limit 21 up the cap limit, the 2.7 percent. 22 Except in the winter, the predictive model allows 23 compliance with the California RFG regulations without the 24 use of oxygen. 25 If a refiner does add oxygen to gasoline, it may PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 87 1 choose any oxygenate allowed by the U.S. EPA. The California 2 regulations do not distinguish among the oxygenates. 3 So far, MTBE has been the refiner's oxygenate of 4 choice for technical and economic reasons. The Federal Clean 5 Air Act requires oxygen in gasoline that must be Federal RFG 6 standards, with an average content of 2 weight percent. 7 Those standards apply to about 70 percent of the 8 gasoline used in California. In addition, the Act 9 conditionally requires State Implementation Plans to include 10 oxygen in gasoline in Federal CO nonattainment areas. 11 The map shows the areas where the Federal RFG 12 standards apply. The winter oxygen requirement is a special 13 requirement to the California RFG regulations. 14 It was adopted in 1991 in response to a Federal law 15 that requires such a program in CO nonattainment areas. 16 The Board made this statewide in 1991, because 17 there were then eight non CO attainment areas that accounted 18 for 80 percent of the gasoline used in the State. 19 However, with this excess of the Mobile Source and 20 Fuel Programs, only Los Angeles is now classified as Federal 21 nonattainment for CO. 22 Now, I will turn to the matter of increasing 23 flexibility under the California RFG regulations. 24 Early this year, the Western States Petroleum 25 Association asked the staff to develop several changes to the PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 88 1 regulations. 2 WSPA requested updating the predictive model with 3 recent test data and adding a model for evaporative 4 hydrocarbon emissions. 5 WSPA also requested higher cap limits on five 6 properties and rescinding the winter oxygen requirement where 7 that would be appropriate. 8 WSPA's goal is to gain for refiners more 9 flexibility to change the type and amount of oxygenate added 10 to gasoline. 11 Regardless of whatever changes the ARB may 12 incorporate with its own regulations, meaningful flexibility 13 would require a change in Federal law to waive for California 14 the oxygen requirement in the Federal RFG. 15 House Bill 630, introduced by Congressman Bilbray 16 and a similar Senate Bill by Senator Feinstein, would make 17 the needed change. 18 The staff supports these bills. 19 The staff worked on WSPA's request under the 20 constraint that the benefits in the regulation should not 21 diminish. 22 The staff held an initial workshop on March 23 twenty-third about the idea of increased flexibility. 24 During the next two months, we held biweekly public 25 meetings to present our progress and to receive the work and PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 89 1 views of other interested parties. 2 On June fifth, we held a second workshop to review 3 some possible changes to the regulations. After several 4 months of work, several technical problems and issues 5 remained unresolved. 6 We found that there was not enough data to update 7 the predictive model correctly, and there are technical 8 problems with drafting new models. 9 These matters are not necessarily intractable; 10 however, they will require new data and more analysis than 11 can be done in the short-term. 12 Of the potential changes investigated by the staff, 13 only increasing the cap limit on oxygen and rescinding the 14 winter oxygen requirement in CO attainment areas can be 15 proposed today. 16 By themselves, these changes can provide only minor 17 improvements to flexibility in oxygen management. 18 We are proposing that the Board increase the cap on 19 the oxygen content from 2.7 to 3.5 percent by weight, and to 20 rescind the minimum requirement for oxygen in the areas that 21 have reached attainment for the Federal and CO standards for 22 ambient CO. 23 Also, we recommend four technical changes to the 24 regulations that are not related to flexibility issues. 25 Increasing the oxygen cap to 3.5 percent by weight PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 90 1 would allow up to 10 percent ethanol in gasoline. 2 The predictive model would remain valid in its 3 current form, and it would protect against increases in 4 exhaust emissions under the higher oxygen cap. 5 The proposal to rescind the minimum oxygen 6 requirement for winter gasoline applies to all areas that 7 have attained the Federal and State CO standards, that is, 8 Northern California and San Diego. 9 Because of continuing violations of the Federal 10 standard in Los Angeles, the requirement cannot be rescinded 11 in the greater South Coast area. 12 Also, we recommend retaining the requirement in 13 Imperial County. Even though Imperial is not Federally 14 designated as nonattainment, it records violations of the 15 Federal CO standard. 16 The recession can be immediate in most of the 17 attainment areas; however, we recommend delaying the date of 18 effect for two years in Fresno and in Lake Tahoe so that the 19 vehicle fleet turnover can provide an extra cushion of 20 emission reductions. 21 It should be remembered that the proposed change 22 would remove a requirement that applies only to winter 23 gasoline and that 70 percent of the gasoline in the State 24 would still be subject to the year-round Federal requirement 25 for oxygen and Federal RFG. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 91 1 We also are recommending four technical changes 2 that are not related to flexibility. One change would allow 3 small retail sites more time with the start of the winter to 4 turn their storage tanks over to oxygenated gasoline. 5 Another would correct an anomaly that prevents an 6 enforcement action against certain noncompliant batches under 7 the averaging system of compliance. 8 A third change would apply the RVP limit to 9 gasoline shipped into Southern California from the Bay Area 10 during the RVP phase-in period. 11 And the fourth change would clarify that racing 12 fuel is exempt from California RFG regulations. 13 The direct effects of adopting a proposal would be 14 small. There would be no new costs imposed on any regulated 15 party, and the changes would preserve the emission benefits 16 of the Gasoline Program, except for possible temporary 17 increase in CO emissions in attainment areas, the increase 18 would not endanger maintaining compliance with the ambient CO 19 standards. 20 However, there could be a major indirect effect on 21 the Board's ability to control the evaporative hydrocarbon 22 emissions with the RVP limit on gasoline. 23 Under the proposed oxygen cap, gasoline could 24 contain 10 percent ethanol. A provision of State law exempts 25 such gasoline for the Board's RVP limit unless the Board PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 92 1 determines that the ozone forming potential of emissions 2 would increase. 3 Without that Board finding, the RVP of 10 percent 4 ethanol blends could increase by about one pound per square 5 inch beginning next March. 6 This would allow a large increase in evaporative 7 emissions from each gallon of exempt gasoline. The increase 8 would not be offset by the predictive model, which addresses 9 only exhaust emissions. 10 To address the effect of such an emission increase, 11 State law allows the Board to make a finding of increased 12 ozone forming potential of emissions from high RVP ethanol 13 leaded gasoline. 14 If the Board makes such a finding, the RVP 15 exemption would no longer apply. The staff has completed an 16 emission test program on 10 percent ethanol gasoline, and the 17 data is publicly available and staff has solicited comments. 18 We are also reviewing relative data from other 19 studies. We plan to bring the Board a recommendation for a 20 finding in December. 21 As I stated before, the current proposal can 22 provide only limited flexibility in oxygen management, 23 especially in light of the oxygen requirements in Federal 24 law. 25 Therefore, we will continue to investigate changes PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 93 1 to the predictive model and other elements of the 2 regulations. 3 The work will continue in consultation with 4 refiners, the auto industry and other groups concerned about 5 the composition of gasoline. 6 Once again, we recommend that the Board raise the 7 oxygen cap limit to 3.5 weight percent, rescind the 8 requirement for oxygen in winter gasoline in attainment areas 9 and make four technical changes to the regulations. 10 That concludes the presentation. 11 CHAIRMAN DUNLAP: All right. 12 Do the Board Members have any questions before we 13 get into witnesses? 14 BOARD MEMBER DeSAULNIER: It is so infrequent that 15 I understand why you could be startled. 16 The question is, will this action make it easier 17 for refiners to do, as TOSCO has done in Northern California 18 at their Rodeo plant, to have the flexibility not to use MTBE 19 and just use ethanol or some other oxygen? 20 MR. SIMEROTH: Supervisor DeSaulnier, it certainly 21 provides them the additional flexibility, particularly in the 22 wintertime, and it also gives them a wider range of ethanol 23 to use year-round. 24 BOARD MEMBER DeSAULNIER: I will share with my 25 Board Members, since they have done this at their UnoCal PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 94 1 stations in the East Bay, they have put up big signs, no 2 MTBE, I don't know if it's working as a marketing strategy, 3 but it's not working as well as dropping the price. 4 MR. SCHEIBLE: It does increase flexibility, but it 5 is very limited. The other factors will still, I think, keep 6 the current practices occurring. 7 This is just a small step in the right direction. 8 CHAIRMAN DUNLAP: Yes, Mr. Calhoun. 9 BOARD MEMBER CALHOUN: If we assume that ethanol is 10 going to be the oxygenate that will be used to increase the 11 level from the current up to the maximum allowed, there is a 12 potential down-side, that is the change in vapor pressure, 13 and you cite that in your presentation. 14 Now, what are we going to do about that? 15 MR. SIMEROTH: Board Member Calhoun, the intention 16 is that we will come back in December with a recommendation 17 to the Board regarding the finding that we are authorized to 18 make under the State law, that is if use of ethanol results 19 in an increase in ozone forming potential, we will make a 20 finding recognizing that, and that means the RVP waiver will 21 not go into place. 22 If we find that there is no increase in ozone 23 forming potential, then there is not an impact on ozone, 24 there may be impact on benzine emissions that we will have to 25 address separately. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 95 1 BOARD MEMBER FRIEDMAN: I want to follow-up on, you 2 know, this oxygen cap appears in absolute terms to be a small 3 number, but it's a 30 percent increase in what exists 4 currently. 5 Since we are going to either simulate, or test to 6 see the influence of raising the vapor pressure and come to 7 some conclusion in December, why are we waiting until 8 December to act on this proposal? 9 I have no clue what the cumulative effect is going 10 to be, and you are telling us, I think, that soon we will 11 know a couple months from now. 12 MR. SCHEIBLE: We have confidence that we currently 13 have the data and can proceed to make that finding in 14 December. 15 We have packaged this together as a group of 16 changes. We think we have incorporated a mechanism to ensure 17 that there won't be a problem come next season when the vapor 18 pressure season comes into effect, we will have dealt with 19 it. 20 During the wintertime the vapor pressure is not an 21 issue. In the summertime, by the time that the summer smog 22 season starts next year, we will have dealt with the issue 23 completely, and our regs will be whole. 24 BOARD MEMBER FRIEDMAN: Mike, this is because you 25 have either real data or simulated data? PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 96 1 MR. SCHEIBLE: No. 2 We have real test data. We have a wealth of test 3 data with this. 4 We simply have to interpret it and go through a 5 whole new process. 6 CHAIRMAN DUNLAP: Mike, let me be more direct, how 7 come it is not packaged with this thing now? 8 I mean, is it just a merge? 9 I mean, you could just say, we just got it, 10 whatever it is, but you need to give us an indication on why 11 it couldn't have been coupled now. 12 MR. SCHEIBLE: Well, the test data became available 13 fairly recently, and we would have had to delay this entire 14 thing today, and we wanted to move ahead as soon as possible 15 providing the most flexibility that we can for this winter. 16 CHAIRMAN DUNLAP: But it will be dealt with in 17 time, in answer to Dr. Friedman's question, for them to deal 18 with it for the summer? 19 MR. SCHEIBLE: Yes. 20 We have to do that, otherwise we would not be 21 responsible in addressing this environmental -- 22 CHAIRMAN DUNLAP: So, WSPA is going to speak. 23 Mr. Kulakowski is going to speak. 24 We are going to ask him in a minute, if he's here, 25 to talk about is that is enough time. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 97 1 Is he here? 2 All the witnesses, if you come up to the front row, 3 we will get you up here. 4 Dr. Friedman, I stepped on you there. 5 BOARD MEMBER FRIEDMAN: No, I'm listening. You 6 know me, if I have some more questions, I will ask. 7 CHAIRMAN DUNLAP: All right. 8 BOARD MEMBER CALHOUN: Did I not understand you, 9 Mr. Scheible, to state in your intro that the data that you 10 have collected so far did not fit the model, the predictive 11 model? 12 MR. SCHEIBLE: We didn't have all the information 13 that we wanted so that we really could relate on numerous of 14 the parameters in the predictive model in terms of T50, other 15 contents, so that we could revise the whole model. 16 That wasn't related to the finding in terms of 17 increased vapor pressure and the effect on emissions. 18 BOARD MEMBER CALHOUN: So, you need to do some more 19 work? 20 MR. SCHEIBLE: With respect to the model, yes. 21 The model is a very complicated black box. 22 CHAIRMAN DUNLAP: Okay. Why don't we get the 23 witnesses up here. 24 Todd Campbell, Mike Kulakowski, and Al Jessel. 25 Did you check in with Ms. Hutchens? PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 98 1 MR. CAMPBELL: Chairman Dunlap, Members of the 2 Board, Todd Campbell, Coalition for Clean Air, and also 3 representing the Sierra Club on this issue. 4 We would like to send a strong statement of 5 opposition to this Item at this time, given that it has been 6 the Coalition's long understanding that any modification to 7 the California Reformulated Gasoline Regulations would not 8 result in an increase of emissions to threaten the goal of 9 emissions equivalents in the flexibility process. 10 However, the proposed amendment, as it was said in 11 the presentation, triggers an outdated 1991 RVP exemption for 12 ethanol blends, blends that CARB staff themselves have found 13 to cause 10 to 18 percent increase in hydrocarbons emissions. 14 We do not agree with the staff's recommendation to 15 pass this rulemaking at this time, allowing this adverse 16 exemption only to retract it at some future date when CARB 17 finalizes its ethanol findings. 18 We feel that this is a premature move. The fact 19 that CARB's own data indicates that ethanol blends increase 20 ozone forming emissions should be a cause for concern. 21 CHAIRMAN DUNLAP: So, you think we should not allow 22 this exemption as of this date; is that correct? 23 MR. CAMPBELL: We should not go forward and pass 24 this rulemaking without making the findings final. 25 We think, you know, if we have the data -- PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 99 1 CHAIRMAN DUNLAP: Okay. Mr. Campbell, let me ask 2 this question. 3 We are going to have the data, Mike, right, in the 4 December timeframe to deal with this; is that correct? 5 MR. SCHEIBLE: We are going to complete the 6 analysis of the data. 7 CHAIRMAN DUNLAP: Are we likely to deal with his 8 concern then? 9 MR. SCHEIBLE: Yes. We have to. 10 And also, to clarify, let's presume we look at the 11 data and we find out that there is an increase in ozone 12 forming potential, we do not rescind the allowance to a 3.5 13 percent oxygenate. 14 We simply say that when you use that you have to 15 use it in a non RVP season, or you have to blend the fuel 16 with a lower RVP base mix so that you don't exceed the vapor 17 pressure standards. 18 CHAIRMAN DUNLAP: I did not mean to cut you off, 19 but I understand where you are coming from, but we are going 20 to have this dealt with effectively in December. 21 I would like it all today, too. I'm where you are 22 with that, but we can't. 23 MR. CAMPBELL: We have a concern about the process, 24 you know, we don't want to jump the gun and, you know, it 25 seems like an out of step move for us, and we have some PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 100 1 strong concerns on this issue. 2 CHAIRMAN DUNLAP: Okay. We have noted it, and I 3 wouldn't necessarily disagree with you about the timing. 4 I understand the urgency of it. Okay. 5 Good. Thank you. 6 Mr. Kulakowski, and Mr. Jessel, and then Ms. 7 Hathaway, if you will check in with the Clerk, Janet. 8 MR. KULAKOWSKI: Mr. Chairman, Members of the 9 Board. Good morning. 10 My name is Mike Kulakowski. I work for the biggest 11 little company that you have probably never heard Eculon 12 Enterprises, which is refining and marketing alliance between 13 Shell and Texaco. 14 I am here today representing the Western States 15 Petroleum Association. You should have or will have our 16 written comments, and my oral comments today will summarize 17 those. 18 WSPA is a trade organization with over 30 members. 19 We produce, market, refine and transport the bulk of 20 petroleum and petroleum products in the five western states. 21 We support ARB's proposal to rescind at above 22 minimum oxygen content for the Federal CO nonattainment areas 23 before you today. 24 We also support ARB's objective of providing 25 refiners a greater number of certification options for PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 101 1 cleaner burning gasoline, because it can allow refiners to 2 ease production constraints and alter oxygenate contents in 3 significant ways. 4 We are, however, somewhat disappointed that the 5 modifications ARB staff is presenting today to the Board do 6 not achieve the intended objective. 7 Nonetheless, WSPA is willing to move forward with 8 the ARB staff to resolve outstanding issues that can lead to 9 useful changes. 10 We also want to clearly state that in the 11 development of new options, we support and will continue to 12 support maintenance of the emission benefits to the 13 California Cleaner Burning Gasoline Program that were 14 expected when the Board adopted the rules for 1991. 15 We also wish to reiterate, and it has been clearly 16 pointed out by staff, that even if the ARB were to approve 17 more certification options for the CBG Program, oxygenate use 18 could be altered only modestly, if at all, by refiners. 19 These alterations are limited by the U.S. 20 regulations on Federal reformulated gas as required in most 21 of the State. 22 To relieve this constraint, the ARB, local air 23 districts, water supply agencies and WSPA support passage of 24 the Bilbray/Feinstein Legislation, which remove the 25 duplication and overlap of the two programs. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 102 1 Without passage of this Legislation, we find 2 ourselves little ability to reduce or change the use of 3 oxygenates. 4 We request that the ARB continue to work with WSPA, 5 U.S. EPA, Congress and other Administration officials to 6 promote passage of the Legislation. 7 When we started this rulemaking, we had high hopes. 8 We had four recommendations we made to the staff of things 9 that they should evaluate and to remunerate in their proposal 10 or their presentation. 11 We discussed updating and making other changes to 12 the predictive model, considering evaporative emissions as a 13 part of the predictive model, increasing cap limits for 14 several of the control parameters and rescinding the 15 wintertime minimum requirements. 16 Only one of these, actually the last item, only a 17 small part of the next to last item are considered for 18 adoption today. 19 Clearly, this package does little to achieve our 20 original goals. While I highlight the commitment by all was 21 great, progress was significant, although several issues 22 could not be resolved in adequate time to present a 23 comprehensive package to the Board today. 24 Addressing the specific issues before you today, 25 WSPA does support the proposal to remove the wintertime PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 103 1 minimum oxygenate requirement. 2 EPA's action to redesignate the CO nonattainment 3 areas, and ARB's analysis of the safety margin demonstrate 4 unequivocally that the Program is not needed and consumers 5 should not have to pay for it in many parts of California. 6 We support staff's judgment on Fresno and Lake 7 Tahoe and believe that the two year delay in that recision is 8 appropriate. 9 We do have a concern, however, that while ARB staff 10 proposes to end the winter program as soon as possible, Board 11 action by itself does not accomplish this goal. 12 We ask the ARB to expedite the next steps so that 13 California refiners can make operational changes where 14 possible. 15 The winter oxygenated gas season starts October 16 first in most of the State. That means that refiners are 17 currently making gasoline to those requirements for a lot of 18 retail stations to be in compliance at the proper time. 19 Once the Board takes the steps today, there are 20 several steps that must be achieved before refiners 21 completely change their formulas. 22 Some of these steps apply to the State and some to 23 the Federal EPA. We urge the Board to direct staff to submit 24 the necessary documents quickly to complete the State steps, 25 including an expedited submission to the Office of PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 104 1 Administrative Law. 2 We also urge ARB to take the steps necessary for 3 the Federal process as quickly as possible. It's our 4 understanding that pursuant to Federal law the oxygen 5 requirements are included in the SIP and are, therefore, 6 likely Federally enforceable. 7 The revision to the SIP, as needed, should be filed 8 immediately with the EPA with the request that it be approved 9 as quickly as possible. 10 For the regulatory reasons described above, 11 California should not expect immediate changes in the use of 12 oxygenate with the Board's decision today. 13 Even once EPA has approved the SIP revision, the 14 State has completed the processes, California should not 15 expect huge changes because of the Federal reformulated 16 gasoline requirements. 17 CHAIRMAN DUNLAP: Even about oxygenated choice? 18 Other than MTBE, is what I am getting at. 19 MR. KULAKOWSKI: I'm sorry, in reference to? 20 CHAIRMAN DUNLAP: You are saying that we shouldn't 21 expect big changes. 22 MR. KULAKOWSKI: I think that oxygenate choice is 23 an issue for each refinery. 24 Each individual refinery is making that choice. I 25 think there was reference to one. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 105 1 CHAIRMAN DUNLAP: Not to confound this discussion, 2 but you are saying, don't expect big changes. 3 What I am getting at is, are there, is there any 4 movement to look at other oxygenate other than MTBE, as far 5 as volume to choose and concerns that people are expressing? 6 MR. KULAKOWSKI: I can speak for my company to say 7 that there aren't -- cut-out some changes in flexibility, so 8 the changes that we had mentioned earlier in our testimony, 9 there is not a lot of flexibility to make those changes. 10 CHAIRMAN DUNLAP: Okay. 11 MR. KULAKOWSKI: I would just like to close by 12 saying that there may be a question in some people's minds 13 about the value of the State taking action before Federal 14 Legislation on oxygenate or Federal reformulated gasoline 15 changes. 16 WSPA strongly believes that to make real progress, 17 changes in both State and Federal rules must be made in 18 today's action and represents an important first step. 19 That concludes my formal testimony, and I would be 20 happy to answer any questions. 21 CHAIRMAN DUNLAP: Mike, Peter, what about some of 22 his suggestions about SIP updates and paperwork, you know, 23 getting things moving, are those reasonable requests? 24 Are we dealing with them? Are we positioned well? 25 What can you say about that? PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 106 1 MR. VENTURINI: Mr. Chairman, this is something 2 that we have discussed, and we have, in prior discussions, 3 the staff's intent to follow, as quickly as we can, the State 4 process, prepare the documents, get it through the OAL 5 process as quickly as possible. 6 We will also proceed as quickly as we can to submit 7 the SIP revision to EPA. 8 Also, beyond that, I think we have made a 9 commitment that is reflected in the draft Resolution to try 10 to work along with the WSPA and other companies, with EPA to 11 urge them to move very quickly in their approval of that SIP 12 revision. 13 CHAIRMAN DUNLAP: All right. It sounds like you 14 have gotten that under way. 15 If you would talk to this gentleman and find out if 16 he has some ideas that maybe you haven't thought about, make 17 sure we are not depositioning ourselves relative to schedules 18 and process. 19 MR. VENTURINI: We will do that. 20 CHAIRMAN DUNLAP: Mr. Kulakowski. 21 MR. KULAKOWSKI: I thought your question, 22 Mr. Chairman, was more pointed at the other items included in 23 the WSPA list. 24 This solely pertains to oxygenate, and there were a 25 number of other items listed also in there. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 107 1 CHAIRMAN DUNLAP: Yeah, not to belabor it, I mean, 2 there is some discretionary things that I believe, I have 3 said this before, that I think your industry could do 4 relative to the MTBE issues, which is largely a public 5 information one, and there are some serious concerns out 6 there. 7 That is all. 8 My question was just to say, you know, are you guys 9 working on anything other than being so dependent upon, 10 process-wise, using MTBE? That is all. 11 It wasn't a trick question. I know that you can't 12 speak for every company. 13 There's economic decisions, and all of this, I 14 understand that, but there is an opportunity for leadership 15 in your industry, too. 16 We have been a partner, as you know, with your 17 industry to deliver a cleaner product, but at the same time, 18 you know, again, this issue about MTBE in particular is 19 crying out for leadership from industry not just government. 20 You and Mr. Jessel, you can take that message back, 21 that's an encouraging comment about exploring all options, 22 because I think you can make a real difference. 23 MR. KULAKOWSKI: Just in response, Mr. Dunlap, I 24 think that the petition that we did file that requested 25 changes to the regulations to increase flexibility can be PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 108 1 construed as a statement of leadership. 2 We took the initiative to try to make the changes 3 that we all agreed were necessary to promote true oxygen 4 flexibility. 5 CHAIRMAN DUNLAP: Understood, but the individual 6 decision to use MTBE is what I am focusing on more 7 specifically. 8 BOARD MEMBER CALHOUN: I guess I'm looking at Peter 9 Venturini, and I think that Mike's questions are, at least 10 two, are kind of tied into each other. 11 There were other issues that WSPA brought before 12 you, and we just glossed over them. Some of these changes 13 may be needed to do what WSPA would like. 14 Why don't you just tell us the status of where the 15 staff is in terms of trying to resolve these other issues? 16 MR. VENTURINI: Okay. But let me just briefly, and 17 then maybe Mr. Simeroth will want to go into a little more 18 detail. 19 We undertook this discussion and the proposals by 20 WSPA with collectively the hope that we could provide some 21 additional flexibility to allow California refiners a little 22 more flexibility to managing oxygenates through some changes 23 to the predictive model with the constraint that we would not 24 compromise the benefits of the Program. 25 As we got into the extensive technical work, and PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 109 1 both WSPA members and staff spent a lot of time doing a lot 2 of technical work, running models, assessing new data, as 3 well as representatives from the auto industry and others, 4 and basically what we came down to is that when we started to 5 take a look at, for example, how some of the new test 6 programs on vehicle emissions, and we started to insert them 7 into the model, we saw, for example, strange, or weird 8 responses in the model that you wouldn't expect from a 9 technical perspective, and we couldn't resolve very quickly, 10 or readily, and I think as a result of that we kind of 11 stepped back, and I think collectively, kind of, maybe we are 12 moving too fast, let's do what we can now and then let's 13 follow-up with these other items, which we intend to do to 14 see what other steps we can take to provide some additional 15 flexibility through the model. 16 CHAIRMAN DUNLAP: Dr. Friedman. 17 BOARD MEMBER FRIEDMAN: I'm, you know, as a medical 18 term, I'm constipated on this issue, and the reason that I am 19 is because, first of all, it's a very important issue, and I 20 would like to be in a position to make a determination that 21 is data driven, and I'm not seeing any, and I'm puzzled by 22 this. 23 I appreciate your sort of checks, balances, kind of 24 total result, probably that is right, but we ought to know 25 that for a fact before we make a change like this. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 110 1 I appreciate the market forces, and the issue of 2 winter, summer and so forth, and it may be that we have to 3 wait a little while and really look at the data and then move 4 ahead, maybe, you know, on a different schedule that would be 5 optimal for this coming summer, but most of the 6 determinations that we have been making about big issues like 7 this have been backed by substantial information. 8 I think I'm really having a problem. I don't think 9 that I can support this just on that basis, not because I 10 don't think it will all work out, but be convincing, and I 11 want to be convinced with real information, and I don't see 12 that right at the moment, so -- 13 CHAIRMAN DUNLAP: Okay. Well, what I think that 14 I would like to do, and we are going to have to deal with 15 Dr. Friedman's concern, and I share it, at least in part, so 16 why don't we come back to that. 17 I would like to work through the witnesses. Mike, 18 I will ask you to keep a list, so that we can deal with this 19 and come back in a systematic way. 20 Anything else for our witness? 21 BOARD MEMBER ROBERTS: I'm feeling the same unease, 22 but it seems to be underscored by the fact that on the need 23 to hurry is offset by the fact that there are so many other 24 hurdles out there, and it's a question of the process here, 25 why are we doing this when there are so many other things out PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 111 1 there that we are trying to accelerate a piece of this 2 without having the basic information? 3 CHAIRMAN DUNLAP: Well, and I think as this plays 4 out we will see that there is some support to do this small 5 step, but at the same time, I would agree that there is some 6 more work that needs to be done and some things need to come 7 back so that we get the whole picture. 8 Are there any questions on this side, because I am 9 going to excuse the witness, and we will get to the next 10 couple. 11 Thank you. The next witness is Mr. Jessel, from 12 Chevron, Tom Koehler, from the Ethanol Industry and Ms. 13 Hathaway. 14 MR. JESSEL: Thank you, Mr. Chairman, and Board. 15 I'm pleased to be here. 16 I think that some of the things that I am going to 17 say here, I am going to start speaking to some of the issues 18 that the Board Members raised, and maybe as a representative 19 of a specific company, I can be a little more specific about 20 at least what Chevron is doing in this regard. 21 I will read my statement and then let you have a 22 chance for some questions and answers. As you are probably 23 aware, Chevron has publicly stated our desire to 24 significantly reduce, or eliminate the use of MTBE due to the 25 concerns and demands of our customers. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 112 1 To achieve this goal, we believe that the Federal 2 reformulated gasoline and oxygen content mandate must be 3 removed, and the California gasoline rules need to be 4 modified. 5 To these ends, we have been actively involved in 6 support of the Bilbury/Feinstein bills in Congress, and the 7 ARB process to develop additional reformulation options for 8 California gasoline. 9 We wish to speak today directly to the decision of 10 the minimum oxygenate requirements as proposed by your staff. 11 We feel recision is a very important step in 12 allowing us to reduce MTBE and strongly urge to adopt the 13 staff proposal. 14 Chevron is capable of making a significant quantity 15 of non oxygenated gasoline for sale in Northern California 16 regions not covered by the Federal RFG, and we did so during 17 the last two summers. 18 The only thing stopping us right now from 19 continuing that summer practice right into winter is the last 20 few steps that the ARB and the EPA need to take to make 21 today's proposed action final and fully effective, assuming, 22 of course, that the Board adopts today's proposal. 23 Inasmuch as the staff report recommends the 24 recision take place as soon as possible, and that's on the 25 staff report, page 9, we recommend the ARB act today to PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 113 1 authorize and direct the Executive Officer to clear the last 2 few steps. 3 In our estimation, the biggest remaining obstacle 4 after you act to rescind your goal today is approval by the 5 Federal Environmental Protection Agency of direction. 6 Traditionally, the ARB revises the State 7 Implementation Plan that must then be approved by the EPA 8 before the recision can become fully effective. 9 This process could easily take months, or years as 10 EPA's SIP revisal process has suffered hundreds of times. 11 In the meantime, the current rules are then 12 Federally enforceable, even though ARB has repealed them. 13 As an alternative to the SIP revision process in 14 this unique instance, ARB and the fuels industry could 15 request a simple statement from EPA to the effect that EPA 16 will not take actions to enforce the requirement. 17 This fall and winter, once the Board has rescinded 18 this, this could come from an exercise of enforcement 19 discretion, or we think it could also come from interpreting 20 the Clean Air Act as not requiring the EPA. 21 Section 211 M6, of the Clean Air Act states that 22 nothing in Section 211 M, which established the Clean Air Act 23 requirements for Wintertime Gasoline Oxygenate Programs in CO 24 nonattainment areas, shall be interpreted as requiring an 25 oxygenated gasoline program in any area which is in PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 114 1 attainment for CO. 2 It contains a narrow assumption that in areas 3 designated to attainment of the carbon monoxide standard, 4 which is the situation that we are dealing with now, and I 5 quote, the requirements of the subsection shall remain in 6 effect to the extent that such program is necessary to 7 maintain some standard thereafter. 8 You have the issue of keeping enough provisions in 9 the regulations to maintain the CO standard, even once you 10 are designated attainment. 11 The staff report clearly states that there is no 12 need for the Winter Oxygenate Program in the 10 redesignated 13 areas for recision. 14 You are adopting the staff's conclusions as part of 15 your findings in your adoption of the Resolution today. 16 Therefore, ARB is today determining that the 17 Program is not required. EPA should not stand in the way of 18 refiners beginning to comply immediately upon the completion 19 of the California rescission process. 20 We have invited ARB to share this interpretation of 21 the law with EPA in hopes of attaining immediate EPA 22 concurrence. 23 We are probably a little bit optimistic. We also, 24 we wrote this yesterday -- we also asked the ARB to take all 25 of their steps to attain EPA approval so that a rescission PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 115 1 can take place as soon as possible. 2 We suggest that you include specific authorization 3 and direction to the Executive Officer to promptly take all 4 actions which are appropriate to obtain EPA's approval. 5 We and the ARB both need EPA's approval that the 6 rescission take effect immediately. As soon as we receive 7 official authorization from ARB, or if EPA approves, we can 8 rely on your rescission and supply significant quantities of 9 nonoxygenated gasoline for sale in Northern California 10 regions not covered by the Federal RFP rules. 11 In closing, we wish to applaud the Board's support 12 for allowing more options in oxygenated use, including 13 support from the Bilbury/Feinstein bills, and the action 14 proposed to be taken today, while a very important step to 15 these actions, well, one of several that need to be to taken 16 for Chevron to be able to fulfill our goal. 17 Thank you. I will happy to entertain your 18 questions. 19 I gave to the Clerk a short letter with some 20 suggested letters. At your discretion you can include it in 21 your Board Resolution. 22 Since I got here, of course, I have seen the 23 proposed Resolution, and the proposed Resolution, I must say, 24 goes a long way to satisfy my concerns, but I don't think it 25 goes all the way, but I do appreciate the Board's and staff's PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 116 1 attempts to try to get the rest of these paperwork issues 2 dealt with as quickly as possible. 3 If they can be done, within a week Chevron can 4 start blending gasoline for Northern California. 5 We are now shipping gasoline into the Northern 6 California region pursuant to the winter oxygen rules with 7 oxygenated fuel because we find that demand. 8 CHAIRMAN DUNLAP: So, this will allow you to 9 produce it without oxygen? 10 MR. JESSEL: This would allow us to back out again, 11 as much of a winter season as we have available for us to do 12 that. 13 CHAIRMAN DUNLAP: So, you would argue that that's 14 why you need us to take action today? 15 MR. JESSEL: That's correct. 16 The sooner it happens, and the paperwork process is 17 completed, the Secretary of State filing and the EPA, 18 whatever EPA has to do, then we can rely on that, begin to 19 rescind the requirement. 20 In the Resolution before you, it does a couple -- 21 it does one very important thing, it says that the staff 22 should work very hard to get the SIP approval through EPA, 23 and we certainly applaud that. 24 What I think we have an opportunity to do is 25 support, explore some other ways of getting to the same PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 117 1 point, at least temporarily to make this effective this 2 winter season, and that is why we are suggesting a little bit 3 different language in your Board Resolution to allow for 4 exploration of other avenues. 5 CHAIRMAN DUNLAP: Okay. All right. 6 Any questions? 7 Ms. Rakow. 8 BOARD MEMBER RAKOW: Yes. 9 Do you have any knowledge of EPA working, or coming 10 out with an approval, or -- quickly, in any case, previously? 11 MR. JESSEL: We talked to EPA yesterday in trying 12 to prepare this testimony, and they seemed very open to 13 moving through the process as quickly as they can. 14 BOARD MEMBER RAKOW: What in their minds is 15 quickly? 16 MR. JESSEL: That's something you have to ask EPA, 17 but we only have their history to go by. 18 They can work in months when they want to move 19 quickly. Their processing if they go as fast as they can 20 will take the rest of this winter oxygenate season. 21 BOARD MEMBER RAKOW: Not meet the October first. 22 MR. JESSEL: No, it will not be October first. 23 CHAIRMAN DUNLAP: Thank you, Mr. Jessel. 24 Tom Koehler, Janet Hathaway and then Catherine 25 Witherspoon. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 118 1 MR. KOEHLER: My name is Tom Koehler, representing 2 the Ethanol Industry today. 3 We support the -- what is before you, as far as the 4 inclusion of 3.5 percent oxygen. 5 We feel that it is, indeed, a small step to get 6 more flexibility. There are other things that need to be 7 done to allow ethanol to fully compete in the market place. 8 Some of those things include the inclusion of a 9 carbon monoxide as ozone precursor in the predictive model, 10 the calibration of the predictive model to more accurately 11 reflect real world emissions; these are all things that I 12 believe staff will be working on, and an inclusion of an 13 evaporative emission model that gives flexibility for RVP. 14 Also, I think it is important to know that while we 15 are revisiting some of these issues, there is one issue which 16 hasn't been addressed in the workshops and work to date, 17 which is the inclusion of a greenhouse gas emission factor 18 for fuel. 19 Recently, Vice President Gore and EPA announced 20 that climate change is a very serious air quality issue, 21 because, as you all know, when temperature rises, more ozone 22 is created. 23 So, I would urge the Board to direct staff to 24 include greenhouse gas emissions as part of fuel parameters 25 in the future. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 119 1 I would also comment that the ethanol industry has 2 always risen to the occasion to provide the supply for the 3 demand, and the industry is poised to do that here in 4 California. 5 So, going to 3.5 would make it more economical for 6 refiners today to use ethanol in the wintertime, certainly, 7 and quite frankly, in response, Chair, to your leadership 8 issue, there is no reason why refiners could not use ethanol 9 in the wintertime today, and I would obviously encourage 10 that. 11 CHAIRMAN DUNLAP: All right. Thank you. 12 I appreciate your industry's continued interest in 13 this matter, and I know you guys have had the nose pressed 14 against the glass on this for a long time, and I wanted to 15 acknowledge that. 16 MR. KOEHLER: Yeah, and we continue to appreciate 17 working with you. 18 CHAIRMAN DUNLAP: Ms. Hathaway, you checked in with 19 the Clerk? 20 MS. HATHAWAY: I have checked in with the Clerk 21 now, so -- 22 My name is Janet Hathaway, and I am representing 23 the Natural Resources Defense Council. 24 I just wanted to say there is only one concern that 25 we have with this proposal, and it could be separated from PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 120 1 the rest of the proposal and held until December. 2 Our concern is about this allowing 3.5 percent 3 oxygen content, because there is data that ARB now has that 4 suggests that that will increase ozone forming potential. 5 We do support what Al Jessel was talking about, 6 which is getting rid of the minimum oxygen content. 7 We do think that is not necessary, and that would 8 be beneficial to do right now. 9 The part that is problematic is increasing the 10 potential that you have, ozone forming content, and that is 11 something that you really shouldn't take up now until you do 12 have that data before you, which would be probably December, 13 and at that time, making the decision to go to 3.5 with the 14 caveat that if it is increasing, the ozone forming potential, 15 that ethanol blend will have to be done with a sub RVP 16 gasoline, so that you don't have the increase in RVP, would 17 make sense. 18 So, our suggestion to you is if you could separate 19 those issues and hold it until December, the process would 20 make more sense and you would not have the potential on that 21 if in December the Board looks different because we have a 22 new Governor, and with all due respect to you, I hope you 23 continue to be here, but who knows what December will bring. 24 CHAIRMAN DUNLAP: I don't think he gets to 25 reappoint until January, Janet. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 121 1 MS. HATHAWAY: If you could hold this so that the 2 decision is made simultaneously, it would make sense. 3 CHAIRMAN DUNLAP: Not that you need to hear it, but 4 I will, this Board is going to be doing its job up until 5 there are changes, and we are not going to be worried about 6 political calendars, but I appreciate that word of caution. 7 All right. Now, Mike, add that to your list, we 8 are going to come back to it, explain that to us. 9 All right. Ms. Witherspoon, you are the last 10 witness on this issue. 11 Is there anyone else? 12 MS. WITHERSPOON: Chairman Dunlap, and Members. 13 Catherine Witherspoon, representing today the American 14 Methanol Institute. 15 I appreciate the consternation that many of the 16 Board Members are feeling about this Item, because I felt the 17 same way when the written staff report came out and there was 18 disclosed, pretty much for the first time, that we had the 19 baggage of a volatility exemption with this rulemaking the 20 staff is considering today. 21 As Janet indicated, there really is only one 22 controversial item in the mixture of staff's proposals, and 23 it is the three and a half percent oxygen cap being raised 24 without simultaneously making the finding with respect to the 25 ozone impacts. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 122 1 All the other pieces of your proposal could proceed 2 if the Board wished to take a small step forward, and I 3 believe all of the other industry witnesses today indicated 4 to you that they would be beneficial when the rescission, the 5 changing of the minimum and the racing fuel, the rest of it, 6 is not problematic. 7 CHAIRMAN DUNLAP: Okay. Very good. 8 Any questions? 9 Good to see you back, Catherine. 10 Mr. Oulrey, I owe you an apology. 11 I always go to the Ombudsman earlier in the 12 process. I apologize. 13 Could you give us update on how this Item came to 14 come before us? 15 MR. OULREY: Sure. 16 Mr. Chairman, and Members of the Board, as you 17 heard from staff, the proposal before you today was an issue 18 that was initiated by concerns of varying MTBE use in fuels 19 and by requests from the Western States Petroleum Association 20 to develop technical changes to the California Reformulated 21 Gasoline Regulations. 22 To prepare for today's proposal, between March and 23 June of 1998, staff conducted two workshops, four 24 consultation meetings, seven technical subcommittee meetings 25 along with numerous one-on-one phone conversations with the PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 123 1 effected stakeholders. 2 Active participants included WSPA, California 3 Independent Oil Manufacturers Association, major gasoline 4 producers, including, Chevron, TOSCO, Mobil, Exxon, Arco, 5 Kern Oil, UnoCal, Paramount Petroleum, the Oxygenated Fuels 6 Association, Renewable Fuels Association, American Automobile 7 Manufacturers Association, major auto manufacturers, 8 including GM, Toyota, Honda and Chrysler, and environmental 9 groups, including the Sierra Club, the Natural Resources 10 Defense Council, or I'm sorry, NRDC, Natural Resources 11 Defense Fund, California Energy Commission, California Trade 12 and Commerce Agency and Assemblywoman Deborah Bowen's Office. 13 All the meetings were announced on the ARB Website 14 and by notices mailed to 1800 people who have been interested 15 in past issues concerning ARB's fuels regulations. 16 The initial statement of reasons in support of the 17 proposal, including the proposed amendments, was also posted 18 on the Website and then mailed to the same list. 19 Other stakeholders notified of the staff's activity 20 include the Engine Manufacturers Association, State Water 21 Resources Board, Cal EPA's Board, Departments and Offices and 22 the U.S. EPA. 23 Staff conducted an extensive outreach to 24 stakeholders to identify all potential issues and to promote 25 participation by all the parties that may be interested in or PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 124 1 affected by the recommendations before you. 2 CHAIRMAN DUNLAP: All right. Thank you for your 3 patience, Bruce. 4 Written comments, Peter, do you want to summarize 5 those, or Dean? 6 MR. SIMEROTH: Mr. Chairman, all the written 7 comments we have had representatives address except for one 8 letter from the American Lung Association. 9 The letter is dated May twenty-first, and it is 10 actually addressing the workshop that we held on June fifth. 11 It is urging us to preserve the benefits of the 12 Program in consideration of changes. 13 CHAIRMAN DUNLAP: All right. There is some 14 confusion on this, Mike. It has been compounded a little 15 bit. 16 MR. SCHEIBLE: We made diesel exhaust too easy. 17 CHAIRMAN DUNLAP: Yeah, how could it be that diesel 18 was easier than this one? 19 Let me lead into this. There is some confusion up 20 here. I am confused. 21 So, what I would like you to do is sort through 22 this, weave through this, Mike, and I want you to answer some 23 questions. 24 Also, the environmentalists pose a concern, and 25 it's been amplified. The WSPA representatives talked about, PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 125 1 you know, this is meaningful for them, it allows them to have 2 some more flexibility, etcetera, but -- I guess at some point 3 I want you to address why we shouldn't delay doing this whole 4 thing until December until it gets sorted out. 5 So, I will look for you to explain the logic there. 6 MR. SCHEIBLE: Okay. I believe that for the 7 purposes of discussion, we should split -- the Board should 8 split its discussion into two separate proposals that are 9 before you. 10 I will deal with, which I think is the easiest one 11 first. We propose to eliminate those areas that do not need 12 the CO reductions to maintain attainment of the minimum 13 oxygenate requirement. 14 I think that all the witnesses supported that, and 15 the issue was, how fast can you do this and get Federal 16 approval, and there is clearly some benefits -- 17 CHAIRMAN DUNLAP: Let me stop you there. 18 Is there a consensus on that? 19 BOARD MEMBER RIORDAN: Yes. 20 I just have a question that the wording that was 21 offered by Mr. Jessel, how do you see that? 22 MR. SCHEIBLE: We reviewed that, and it is 23 acceptable to us to include that in the Resolution. 24 CHAIRMAN DUNLAP: Okay. So we have consensus on 25 the easy part. Okay. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 126 1 Kathleen, do you want us to deal with that now, or 2 how do you want us to deal with this? 3 MS. WALSH: Well, I think it would probably be 4 better to move ahead and consider the second issue that Mike 5 is going to discuss. 6 CHAIRMAN DUNLAP: Okay. Go ahead, Mike. 7 MR. SCHEIBLE: Okay. On the second issue, what 8 staff has proposed is that we make the change now to allow up 9 to 3.5 percent oxygen content in gasoline. 10 When we do that, we acknowledge that we have an 11 obligation to come to you and make the finding, will this, 12 when coupled with the other provisions of law, lead to an 13 increase in ozone forming emissions. 14 The risk you run is not that we don't make that 15 finding, we make that finding, we either find it, if there is 16 an increase and there is no RVP allowance allowed because 17 that process takes it away, when we find that there is no 18 increase, in which case it is okay to do it. 19 The only risk is that we don't come to the Board 20 and we don't complete that process. Under that situation, 21 then we have changed the reg and people can avail themselves 22 of that, and we haven't resolved the issue. 23 Our promise to the Board was that we come and do 24 that in December and complete it, so that was why we proposed 25 it the way that we. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 127 1 The Board has a second option, which is to say, we 2 don't want to run that risk. We want to delay our action on 3 that part of the staff proposal, and say, staff come back to 4 us when you are ready to make the finding, and we will do 5 both at once, and that I think is the choice. 6 If you are uncomfortable with the staff 7 recommendation, then you can go to the second choice, which 8 is you say you want to eliminate running that risk by 9 combining the two items. 10 CHAIRMAN DUNLAP: Okay. Now, who -- the later 11 option was that we delay until December. 12 MR. SCHEIBLE: Right. 13 But the downside of that is that certain fuel 14 producers could take advantage of the increased oxygen 15 content in a way that doesn't hurt air quality in the 16 interim. 17 CHAIRMAN DUNLAP: By building the sub RVP fuel, 18 which Ms. Hathaway suggested. 19 MR. SCHEIBLE: Or in the wintertime when there is 20 not an RVP constraint using a higher ethanol content because 21 the economics of it work out. 22 CHAIRMAN DUNLAP: Okay. Bill, you and Ron. 23 BOARD MEMBER FRIEDMAN: Part one is easy. I like 24 the second part of part two. 25 I personally like the idea of waiting. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 128 1 CHAIRMAN DUNLAP: You have to hit the button there. 2 BOARD MEMBER FRIEDMAN: You've enunciated my 3 position very well in the second part of part two. 4 I am in favor of waiting until the information is 5 in and then having a look at it, and then making a more 6 informed determination. 7 CHAIRMAN DUNLAP: Okay. Ron. 8 BOARD MEMBER ROBERTS: I likewise feel comfortable 9 with that second option that he spelled out and being able to 10 take the first step also, separate it out. 11 BOARD MEMBER RAKOW: I need some clarification on 12 the overwhelming advantage to adopt part two and part one 13 together, I mean, part two also, putting a 3.5 percent cap 14 now instead of waiting for the data in December. 15 MR. SCHEIBLE: I think the advantage is that it 16 would allow all fuel producers greater options in how they 17 blend oxygen. 18 In most of the country ethanol is blended at higher 19 than 2.7 percent, so it provides economic flexibility. 20 BOARD MEMBER RAKOW: Mike, then if in December we 21 find that we have to rescind a potential action today, 22 doesn't that put those producers at a disadvantage that have 23 been working for three months trying to do something that 24 they are going to have to stop in December? 25 MR. SCHEIBLE: No, because in December if we make PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 129 1 the finding that there is an adverse effect on ozone because 2 of the RVP exemption, that does not rescind the 3.5 percent. 3 The fuel producers are allowed to blend to 3.5 4 percent. What they have to do is when they do that is do it 5 in a way that doesn't violate, doesn't exceed the 7 RVP 6 limit. 7 CHAIRMAN DUNLAP: Okay. Mr. Kulakowski, could you 8 articulate one more time your view on that decoupling issue 9 as it relates to the two options that we have before us? 10 I would like to hear your recommendation. 11 MR. KULAKOWSKI: We were very careful to not 12 mention this part of the proposal in our testimony, and 13 advisedly so. 14 I really can't say anything as a representative of 15 the Association, other than maybe to point out the fact that 16 staff that, I think that there is not a November one date 17 attached to that proposal to ensure that the impacts don't 18 occur. 19 I can verify that we understand there is not a 20 unified position among all the producers about this 21 provision; therefore, WSPA does not have a position. 22 CHAIRMAN DUNLAP: Well, I tried. You are welcome 23 to take your seat back there. 24 What do you want to do? 25 We have two or three of our colleagues feel PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 130 1 strongly about decoupling it and going with the second 2 option, which is delaying until December until it gets sorted 3 out, not taking the position to support the 3.5. 4 BOARD MEMBER RAKOW: But we could take a position 5 on the first. 6 BOARD MEMBER FRIEDMAN: I move that we rescind the 7 requirement for the winter oxygen in the CO attainment areas, 8 end of motion. 9 CHAIRMAN DUNLAP: Let's articulate that. 10 MR. SCHEIBLE: It is to remove it in the areas that 11 have been redesignated as Federal attainment areas as 12 specified in the staff report and the timing as specified. 13 BOARD MEMBER RIORDAN: I'll second the motion if 14 the maker would add the wording that -- in Mr. Jessel's 15 letter, which seemed to not trouble staff but might assist 16 them a bit. 17 MS. WALSH: Chairman Dunlap, if I might suggest, if 18 you want to go ahead and take a vote on this second issue, so 19 that you can convey to staff the Board's consensus, perhaps 20 what we could do is to take a break for lunch, we could make 21 changes to the Resolution, reflect it and bring it back. 22 CHAIRMAN DUNLAP: That would be fine. 23 Why don't we do that. We will take a 35 minute 24 break for lunch. We will ask staff to come back with the 25 language reflecting the motion and the second that is before PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 131 1 us. 2 We will have some discussion. I will deal with 3 ex parte, and then we will move on. Okay. 4 We will reconvene at 1:00. 5 MS. WALSH: Chairman Dunlap, if I could ask, if you 6 would go ahead and have a vote on the motion that's before 7 you on the second issue, which would provide the direction to 8 staff to go ahead and do the -- 9 CHAIRMAN DUNLAP: All right. That's fine. 10 We have a motion before us to -- 11 You have to turn on your mike. 12 MR. JENNINGS: One more point of clarification, 13 which is I think the consensus is to have the Board adopt the 14 entire proposal except for raising the 3.5 cap, there were 15 some other cleanup elements that I don't think were 16 controversial. 17 CHAIRMAN DUNLAP: The Chair would entertain a 18 motion as stated by Counsel. 19 BOARD MEMBER FRIEDMAN: So moved. 20 BOARD MEMBER RIORDAN: I second. 21 CHAIRMAN DUNLAP: It's moved, and seconded by 22 Dr. Friedman and Mrs. Riordan. 23 I will do a voice vote. 24 All of those in favor -- well, wait a minute, do I 25 need to do ex parte before we do that? PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 132 1 All right. We don't. 2 All those in favor, say aye. 3 Any opposed? 4 All right. Very good. 5 We will come back and deal with this after lunch. 6 We will reconvene at 1:00. 7 (Thereupon the lunch recess was taken.) 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 133 1 A F T E R N O O N S E S S I O N 2 --o0o-- 3 CHAIRMAN DUNLAP: Okay. I'm going to ask people to 4 take their seats. 5 Tom, is Mr. Luskatoff here? 6 What I think we are going to do is we are going to 7 deal with the Resolution, which is in typing, so it's going 8 to come back, those of you that are waiting on the earlier 9 Item. 10 So, we will have Mr. Luskatoff come and give his 11 presentation, which is Item 98-5-6, a Continuation of a 12 Public Hearing to Consider the Adoption, Amendment and Repeal 13 of Regulations Regarding Certification Procedures and Test 14 Procedures for Gasoline Vapor Recovery Systems. 15 This Item is a continuation of Item presented in 16 May of this year and involves revisions to the certification 17 and test procedures at gasoline dispensing facilities, bulk 18 plants, terminals and cargo tanks. 19 The vapor recovery procedures are periodically 20 updated to keep up with new technology. The last such update 21 occurred in 1996. 22 Mr. Cackette, would you introduce this brief Item 23 for us. 24 MR. CACKETTE: As you will recall, in May we 25 presented for your consideration a set of proposed PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 134 1 certification and test procedure revisions related to Stage 2 II Vapor Recovery Systems. 3 ARB certified Stage II equipment for use in 4 California and, in fact, we certified it for use in almost 5 all of the nation. 6 Stage II is the term we use for the pollution 7 control refueling nozzles that you see at gas stations, the 8 things that have the bellows on it, more recently the one's 9 that do not have the bellows on it. 10 The need for changes in certification test 11 procedure relates in part to the fact that the 1998 new cars, 12 and subsequent model new cars, have an on-board vapor 13 recovery system on them, and it's basically a system which 14 competes with the Stage II System to collect the gasoline 15 refueling vapors. 16 What we presented to you in May as largely a 17 technical revision to test procedures turned out to have 18 significant implications that we had not fully explored. 19 As suggested by the testimony, these seemingly 20 minor certification and test procedure changes could require 21 wide spread replacement of Stage II equipment at service 22 stations at considerable cost. 23 Furthermore, it was pointed out that the 24 interaction of the Stage II equipment with these new cars 25 which have the on-board vapor recovery system could cause PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 135 1 significant increases in emissions and there were ways to 2 remedy this. 3 Now, we were aware of these issues and, in fact, we 4 have had two research projects underway for some time to 5 quantify impacts of refueling these new, what we call, ORVR 6 equipped vehicles, and we have also completed, in cooperation 7 with the districts, a field survey of existing vapor recovery 8 equipment using these new test procedures that we have 9 developed, and the survey revealed that there was a 10 significant fraction of the bellowless type, the one's 11 without the boot on them, the vapor recovery equipment that 12 was not capturing refueling vapors properly and this was 13 causing excess emissions. 14 So, what we failed to do in May was to reach out to 15 all the stakeholders and address the larger picture of 16 overall Stage II Vapor Recovery System operation and 17 efficiency. 18 Since May, we have met several times with 19 stakeholders. We have a group formed which includes the oil 20 industry, vapor recovery equipment manufacturers, the local 21 districts and automobile manufacturers, and we believe that 22 we could have turned what appeared to be a disagreement over 23 test procedures into a new opportunity to reduce refueling 24 emissions above and beyond what is occurring now. 25 This could, in the end, result in new Stage II PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 136 1 Vapor Recovery equipment being installed at service stations. 2 It could result in new diagnostic equipment being 3 installed at service stations, so that when the system is not 4 working right, the people will be alerted to that. 5 It could result in other program improvements that 6 will further reduce emissions in California. 7 As you might guess from the breadth of the issues 8 and the implications here, it is going to take us a while 9 longer to collect and analyze all the necessary data, perform 10 cost effective assessments and work out the details with many 11 of the stakeholders. 12 We will be able to return to you with our 13 recommendations for this more global look at Stage II Vapor 14 Recovery in the first half of 1999. 15 In the meantime, we are proposing today that you 16 adopt the other vapor recovery certification and procedure 17 changes for which there are no outstanding issues that we are 18 aware of. 19 So, at this time, I would like to turn the 20 presentation over to Cindy Castronovo, of the Monitoring and 21 Laboratory Division. 22 MS. CASTRONOVO: Good afternoon, Chairman Dunlap, 23 Members of the Board. 24 As indicated by Mr. Cackette, we presented 2 new 25 and 13 revised procedures at the May Board meeting. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 137 1 The testimony focused on the proposed On-Board 2 Refueling Vapor Recovery, or ORVR, test procedure, which has 3 been removed from today's proposal along with one other test 4 procedure. 5 Today we will present the remainder of the original 6 May procedures, which consist of one new test procedure and 7 twelve revised procedures. 8 We plan to present the two postponed procedures at 9 a 1999 Board meeting as part of our new enhanced Vapor 10 Recovery Program. 11 I will now discuss our proposed revisions to the 12 vapor recovery procedures. These test procedures are used by 13 the Air Resources Board to certify vapor recovery systems, 14 and some are used by districts for ensuring compliance with 15 performance specifications. 16 We are requesting a temporary exemption for airport 17 refueler cargo tanks to allow them to conduct their annual 18 leak decay test safely and legally. 19 A new test procedure, the Tie-Tank Test, was 20 requested by the districts to ensure that the gasoline 21 dispensing facility underground storage tanks are connected 22 correctly. 23 Finally, we proposed several improvements and 24 clarifications to the existing test procedures, which result 25 primarily from both agency and private test requirements. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 138 1 These revisions do not increase the stringency of 2 the procedures and some changes result from harmonization 3 with Federal requirements. 4 We propose a temporary exemption for airport 5 refuelers. An airport refueler is defined as a cargo tank 6 which has a total capacity no greater than 2,000 gallons, 7 exclusively transports av gas and jet fuel and is not 8 licensed for public highway use. 9 As part of their annual certification, all cargo 10 tanks subject to vapor recovery regulations must undergo a 11 Pressure Decay Test to check for leaks. 12 However, for safety reasons, gasoline vapors must 13 be removed before this test is conducted. The test procedure 14 prohibits venting vapors to atmosphere, and most cargo tank 15 operators can satisfy this requirement by venting to a 16 loading rack control system, or loading with diesel fuel just 17 before the test. 18 Airport refuelers do not leave the airports and do 19 not meet the Department of Transportation or Motor Vehicle 20 Code requirements to travel on public roads. 21 They cannot switch fuel with diesel due to the 22 danger of av gas contamination, thus airport refuelers must 23 seek various relief to vent emissions legally before the 24 test. 25 This proposed exemption will expire. At least two PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 139 1 ARB certified mobile vapor processors are available. 2 These processors would travel to the airports, and 3 thus could be used to degas the airport refuelers of vapors 4 on-site. 5 Two mobile degassers were contacted by staff. They 6 both use internal combustion engines to destroy hydrocarbons 7 transferred from treated sources. 8 They have successfully purged hundreds of 9 underground and above ground tanks at dispensing facilities. 10 At least one of these companies is already 11 permitted by the South Coast AQMD, and is very interested in 12 providing airport cargo tank degassing services. 13 Staff will work with interested companies to 14 facilitate certification of mobile degassers. 15 This slide summarizes the remainder of the proposed 16 revisions. 17 The Tie-Tank Test is a proposed new test procedure 18 to check for proper underground plumbing configurations at 19 gasoline dispensing facilities. 20 This procedure was requested by several air 21 pollution control districts to assist with their inspection 22 and permitting of gasoline dispensing facilities. 23 Other improvements include clarifications to the 24 test procedures as requested by private testers, districts 25 and ARB staff, who use these procedures. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 140 1 Some test method issues have not yet been resolved, 2 including the Pressure Decay Test used by districts for 3 compliance purposes. 4 Although we are clarifying the language at the 5 present Pressure Decay Test, we are committed to working with 6 the districts to further evaluate this particular test method 7 and to develop methods that will best ensure ongoing 8 compliance of vapor recovery systems. 9 Two workshops were held to solicit input from 10 affected parties before the May Board meeting. Updates on 11 these procedures were also provided at an ORVR working group 12 meeting and a recent workshop on enhanced vapor recovery. 13 The staff would like to acknowledge the assistance 14 provided by the CAPCOA Vapor Recovery Technical Committee, 15 particularly the Bay Area AQMD and San Diego APCD, who 16 provided the original drafts of some of the proposed 17 procedures. 18 We also appreciate the comments and suggestions 19 from the equipment manufacturers, independent tester and 20 industry associations. 21 Although the airport refueler exemption will allow 22 airport tankers to continue operation for now, there are 23 costs associated with the eventual termination of the 24 exemption. 25 Depending on the type of system used to control PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 141 1 hydrocarbon emissions, certification costs for the mobile 2 degassers are expected to be in the range of $2,000 to 3 $6,000. 4 Once two mobile degassers are certified, airport 5 refuelers will be subject to costs estimated at $500 to 6 $1,000 to degas a cargo tank. 7 BOARD MEMBER FRIEDMAN: Per year or per degasser? 8 MS. CASTRONOVO: We estimate hydrocarbon emissions 9 of a tenth of a ton per year as a result of the airport 10 refueler exemption. 11 We emphasize, again, that this is a temporary 12 exemption that will expire once two mobile degassers are 13 certified. 14 In summary, I would like to point out the 15 consequences of not adopting these proposed revisions. 16 Denying the airport refueler exemption will force 17 these cargo tanks to discontinue operation or operate in 18 violation of the law. 19 If the method revisions are not adopted, some 20 confusion will remain regarding method requirements. 21 As I close my presentation, I would like to draw 22 your attention to the package of recommended 15-day changes, 23 which has been provided to you. 24 Many of these comments were distributed by mail and 25 the ARB Web Page in July. Additional changes have been added PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 142 1 since July regarding the airport refueler cargo tanks 2 eligible for the venting exemption and harmonization of cargo 3 tank Pressure Test limits with Federal requirements. 4 All of these revisions will be distributed through 5 our mailing list and through the Website for a minimum of a 6 15-day comment period. 7 In conclusion, we ask that you approve the 8 certification and test procedure changes. In addition, we 9 will return to you in 1999 with a proposed revision to the 10 Vapor Recovery Program, which will address the issue shown on 11 this slide, in which we will provide additional reductions in 12 emissions. 13 As shown here, we will propose ORVR compatibility 14 to ensure there is no loss in emission control efficiency 15 when refueling ORVR vehicles, propose Program improvements, 16 including warranty and liability clarification along with 17 in-service performance issues and will propose in-station 18 diagnostics to alert the facility operator of vapor recovery 19 equipment malfunction. 20 This concludes my presentation. 21 CHAIRMAN DUNLAP: Thank you. 22 Mr. Oulrey, do you want to address the process 23 prior to today, where which this Item came to the Board. 24 MR. OULREY: Mr. Chairman, and Members of the 25 Board. The proposal before you today was first considered PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 143 1 during the May Board meeting. 2 At that time, the proposal addressed On-Board Vapor 3 Recovery, or ORVR, Enhanced Vapor Recovery, EVR, as well as 4 the Cargo Tank Vapor Recovery Test method changes, which are 5 before you today. 6 Following the May meeting, approximately 800 7 stakeholders were notified by letter on July fourteenth, that 8 all items pertaining to On-Board Vapor Recovery and Enhanced 9 Vapor Recovery had been postponed until the December Board 10 meeting. 11 Additional opportunity for comments on today's Item 12 were provided through response to the July fourteenth letter, 13 and through two ORVR/EVR workshops held July first, and 14 August eleventh, of this year. 15 No comments on today's Item were received as a 16 result of these opportunities. The only comments received 17 since the May Board meeting were verbal comments from CAPCOA, 18 which staff intends to address during the 15-day comment 19 period. 20 Staff currently are taking a very proactive 21 approach with stakeholders for the development of the 22 ORVR/ERV items. 23 CHAIRMAN DUNLAP: All right. Thank you. 24 Do any of the Board Members have questions? 25 Yes, Dr. Friedman. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 144 1 BOARD MEMBER FRIEDMAN: With respect to this issue 2 of the temporary exemption for the airport refueler, we have 3 a letter in our file, you capped it at 2,000 gallons, and 4 there is a letter in the file speaking about a few of these 5 refuelers for forest fires that go up to 5,000; do you have 6 an objection, is that within the parameters of what you are 7 looking for, since the exemption is temporary anyhow? 8 MS. CASTRONOVO: Yeah, I was going to discuss that 9 when we came to the summary of the comment letters. 10 We did get a letter from Mr. Wilson, of Corporate 11 Aircraft in Fresno, that requested that we increase the 12 gallonage from 2,000 to 5,000 gallons, and that we agreed to 13 make that change because those larger tanks are used to 14 support firefighting efforts in the State, and it is a part 15 of the 15-day change package. 16 CHAIRMAN DUNLAP: All right. Good. 17 If there aren't any other questions, we will go to 18 the witness list. 19 There isn't one. 20 Then we will go to the -- any written comments, do 21 you want to summarize those? 22 MS. CASTRONOVO: That was it, the one letter from 23 Mr. Wilson. 24 CHAIRMAN DUNLAP: All right. That will conclude 25 the public testimony. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 145 1 Cindy, do you want to say anything about the other 2 letter? 3 MS. CASTRONOVO: I can't. 4 I don't think this made it into our letter file, 5 but we did meet with these people from Kinder Morgan at the 6 last Board meeting in May, and we did make the changes they 7 are requesting regarding the PV valves, and those are in the 8 15-day package. 9 CHAIRMAN DUNLAP: Okay. All right. 10 Mr. Cackette, do you have anything further that you 11 want to say? 12 MR. CACKETTE: No, nothing else. 13 CHAIRMAN DUNLAP: All right. I will now officially 14 close the record on this Item. 15 The record will be reopened when the 15-day notice 16 of public availability is issued. Written or oral comments 17 received after this hearing date, but before the 15-day 18 notice is issued will not be accepted as part of the official 19 record on this Item. 20 When the record is reopened for a 15-day comment 21 period, the public may submit written comments on the 22 proposed changes, which will be considered and responded to 23 in the Final Statement of Reasons for the regulation. 24 Do we have any ex parte communications to report? 25 All right. We have before us Resolution 98-27. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 146 1 The Chair would entertain a motion and a second to 2 adopt the staff proposal with the assurance that this 15-day 3 notice package is going to deal with those issues as staff 4 has outlined. 5 Is there a motion? 6 Moved by Mr. Parnell. Seconded by Mr. Roberts. 7 Any discussion? 8 Very good. We will proceed with a voice vote on 9 Resolution 98-27. 10 All those in favor, say aye. 11 Any opposed? 12 Very good. The motion carries. 13 The Resolution has been approved. 14 Mr. Luskatoff, would you like to, or Mr. Cackette, 15 would you like to introduce the brief next Item, Stationary 16 Source Test Methods, which, of course, are going to reflect 17 sound technical information, accurate measurement of source 18 emissions, State law requires us to adopt these procedures 19 and this is part of your continuing effort to do the best job 20 possible. 21 Tom will introduce this for us. 22 MR. CACKETTE: Thank you, Chairman Dunlap, and 23 Members of the Board. Since the early 1980's, the Board has 24 adopted 61 different stationary source or vapor recovery test 25 methods. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 147 1 These methods are used to determine compliance with 2 district rules and also to evaluate the effectiveness of air 3 pollution control equipment, support control measure 4 development and develop emission inventories. 5 Most of ARB methods are developed to support 6 district regulations and the ARB State regulations, such as 7 the Air Toxic Control Measures, the Air Toxics Hot Spots 8 Programs. 9 The ARB methods are also used for research studies 10 where using a consistent measurement technique is always 11 desirable. 12 During preparation of proposed revised methods, the 13 staff has consulted interested parties, including EPA, 14 districts, source test contractors and analytical 15 laboratories. 16 The revisions were initially prompted by U.S. EPA 17 requests that the ARB upgrade its methods to be incorporated 18 in the State Implementation Plan. 19 Care has been taken to promote consistency with 20 U.S. EPA methods to avoid multiple test requirements for the 21 same pollutant in a facility. 22 Revised methods are not expected to increase the 23 cost of testing to any significant extent. 24 Once again, Cindy Castronovo, of the Monitoring 25 Laboratory Division, will present the Item to you. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 148 1 MS. CASTRONOVO: Thank you, Mr. Cackette. In this 2 presentation I'll explain the reasons for our proposed 3 amendments for several of the ARB stationary source test 4 methods. 5 We have proposed revisions to 20 of the ARB source 6 test methods, which are listed here. Methods 1 through 4 are 7 foundation methods for almost all the staff tests, providing 8 assessment of proper sampling locations, flow characteristics 9 and moisture content of the stack gas. 10 Methods 5-A through 11 determine particulate sulfur 11 compounds, carbon monoxide and hydrogen sulfide emissions. 12 Methods 12 through 16-A measure lead fluoride and 13 reduce sulfur compounds. Method 17 is an in-stack filter 14 method. 15 Method 20 is for stationary gas turbines, and 16 Method 21 determines VOC compound leaks. These revisions 17 were triggered by a request from U.S. EPA Region 9 that we 18 review and modify our test methods to make them more 19 consistent with their U.S. EPA counterpart methods. 20 We took this opportunity to update older methods to 21 align them with improvements already included in more recent 22 methods. 23 We also discovered several errors in emissions 24 dating from when the methods were originally typed. 25 State law directs ARB to adopt test procedures to PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 149 1 measure compliance with its nonvehicular emissions standards 2 and those of districts. 3 Since 1983, the Board has adopted 61 test 4 procedures for both criteria and toxic air pollutants. All 5 of the test methods proposed for revision today are based on 6 similar U.S. EPA methods. 7 The districts also have authority to adopt their 8 own test procedures, and some of the larger districts, such 9 as the South Coast and Bay Area, have opted to do so. 10 One downside of relying on the non Air Resources 11 Board Method is that revisions might be made that diminish 12 the quality of the emission results from a California 13 perspective. 14 That is why ARB has chosen to adopt methods that 15 are very similar to U.S. EPA methods that include provisions 16 where necessary to meet California source test needs. 17 Another advantage of adopting our own methods is to 18 provide California districts and testers with timely 19 decisions on requests to modify test methods. 20 Due to specific source configurations, it may be 21 necessary to request a change in conducting a test. 22 For example, process conditions may be of such 23 short duration that minimum sampling times cannot be met. 24 Requests for a site-specific change on an U.S. EPA 25 method must be forwarded to U.S. EPA staff for review and PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 150 1 approval. 2 Finally, State law requires that ARB methods be 3 used as default methods in district rules where no other 4 method is specified. 5 Periodic revisions to stationary source test 6 procedures are expected and desirable. As technology 7 changes, improvements can be made in the existing procedures. 8 Also, more recent attention to quality assurance to 9 assess dependability of emission results has led to 10 additional requirements in test procedures. 11 This slide summarizes the development of the 12 proposed test method revisions. A workshop was held on April 13 fourteenth, which elicited very few comments. 14 More extensive written comments were received from 15 the U.S. EPA and the San Diego APCD. These comments were 16 then used to improve the revised procedures. 17 The latest revisions were mailed with the Board 18 meeting notice and staff report to all districts, interested 19 parties, including staff testers, on our mailing list. 20 The proposed revised procedures have also been 21 posted on the ARB Webpage. Many changes were made in each of 22 the revised procedures, most of the significant changes were 23 due to harmonizing the ARB method with the most current U.S. 24 EPA counterpart. 25 These included new calibration checks and other PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 151 1 quality assurance improvements. Dozens of minor editorial 2 changes were also made to the revised methods. 3 A significant change made to all of the revised 4 methods has been removal of district authority to permit 5 modifications to an ARB method. 6 The current methods allow either the district or 7 the ARB to approve test method modifications. A similar 8 change was proposed and adopted when our last stationary test 9 method update was presented to you in August of 1996. 10 Some districts have expressed concerns regarding 11 this change, which we will address on the next two slides. 12 We believe limiting approval of deviations to test 13 procedures at the State level provides a more consistent 14 application of the procedures throughout the State. 15 Although some districts are fortunate to have 16 source test experts among their staff, differences can occur 17 between experts on whether a method modification is 18 acceptable, and because data collected at one source might 19 someday be used to evaluate a similar source in another 20 district, it is important that measurement techniques be 21 comparable. 22 Another advantage to having all of the requests 23 come to ARB is that we can identify if changes are warranted. 24 For example, numerous requests to modify the method 25 for ethylene oxide measurement led to recent changes in the PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 152 1 ETO test procedure. 2 The districts concern is whether ARB can respond 3 quickly to method modification requests. Our records 4 indicate that tests that are requested to revise the 5 procedures are rare, less than 10 per year. 6 Staff already handled these requests within one 7 day, if necessary, to avoid delays to a test team in the 8 field, by giving a verbal approval, followed by a letter. 9 Many ARB methods outline pretest plan requirements 10 that should identify any potential problems in advance. 11 Harmonization of ARB and U.S. EPA methods allows 12 either method to be used to satisfy the test requirement for 13 a given pollutant. 14 This is important to avoid having a source pay for 15 two source tests for the same pollutant to meet State and 16 Federal requirements. 17 The additional quality assurance requirements may 18 result in some small cost increases to some testers. 19 Most testers are already equipped to conduct both 20 U.S. EPA and ARB test procedures, and thus would not incur 21 additional costs. 22 One tester estimated costs for audit samples, a 23 common QA measure, might run about $60 a month, but 24 emphasized that it is already current practice for most 25 testers. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 153 1 To summarize, we have prepared revisions to 20 test 2 procedures to harmonize ARB methods with current U.S. EPA 3 requirements. 4 We have included additional improvements based on 5 staff's detailed review. We have changed all the revised 6 procedures to reflect that the ARB Executive Officer approval 7 is required on a case-by-case basis for test method 8 deviation. 9 In conclusion, we request that you approve the 10 proposed revisions. Staff has addressed and resolved the 11 concerns raised during the outreach process. 12 These method revisions are expected to result in 13 minimal, if any, increases in source test costs. 14 This concludes my presentation. 15 CHAIRMAN DUNLAP: Thank you. 16 Mr. Ombudsman, do you want to tell us about this 17 one, briefly? 18 MR. OULREY: Yes, Mr. Chairman. 19 The staff proposal is the result of two years of 20 cooperation between ARB, U.S. EPA, local air districts staff 21 and other interested parties. 22 A public workshop was conducted in Sacramento, on 23 April 14, 1998, for all of the proposed method revisions 24 before you today. 25 Notice went to some 150 stakeholders, and a notice PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 154 1 was posted on our ARB Website. Detailed comments previously 2 received from U.S. EPA and from the San Diego Air Pollution 3 Control District were considered in revising the initial 4 draft revisions presented at the workshop, as well as scores 5 of telephone conversations and E-mails, and no concerns were 6 raised at that time. 7 In conclusion, it appears stakeholder involvement 8 in the development of this Item was reasonable and that all 9 is well with the proposed package before you today. 10 CHAIRMAN DUNLAP: Thank you. 11 Any of the Board Members have questions? 12 All right. Very good. 13 Any written -- we have no witnesses, is there any 14 written correspondence that we have on this? 15 MS. CASTRONOVO: Yeah, we received one E-mail from 16 Robert Whitenfeld, of Quaterra, Incorporated, who suggested 17 some modifications to our Method 12 that would allow updated 18 analytical techniques, and we have made his suggested changes 19 and included them in the 15-day package. 20 CHAIRMAN DUNLAP: All right. Very good. 21 Mr. Cackette, anything else that you want to add? 22 MR. CACKETTE: Nothing else, Mr. Chairman. 23 CHAIRMAN DUNLAP: All right. Thank you. 24 We will now close the record. However, the record 25 will be reopened when the 15-day notice of public PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 155 1 availability is issued. 2 Written or oral comments received after the hearing 3 date but before the 15-day notice is issued will not be 4 accepted as part of the official record on this Item. 5 When the record is reopened for a 15-day comment 6 period, the public may submit written comments on the 7 proposed changes, which will be considered and responded to 8 in the Final Statement of Reasons for the regulation. 9 Any ex parte communications we need to disclose? 10 All right. Very good. 11 We have before us Resolution 98-38, which contains 12 the staff recommendation. 13 Do I have a motion and a second to the staff 14 proposal? 15 BOARD MEMBER RAKOW: I so move. 16 CHAIRMAN DUNLAP: Ms. Rakow. 17 Seconded by Supervisor Patrick. 18 Any discussion? 19 All right. Very good. 20 We will proceed with a voice vote. 21 All those in favor, say aye. 22 Any opposed? 23 Very good. Thank you. 24 Bill, appreciate it. Tom, nice work. 25 Okay. We are going to take care of Dr. Holmes, PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 156 1 Mr. Barnes items, and then we will come back. 2 Again, my apologies to those waiting on the fuels 3 Item. We will come back to that. 4 We are going to deal with the Research Screening 5 Committee Item first. 6 This is a public meeting to consider 98-9-5, to 7 consider appointments for the Research Screening Committee. 8 This statute creating the Board also authorized the 9 Board to appoint a Research Screening Committee to advise the 10 Board on its extramural research activities. 11 The Committee has nine members total, each 12 representing a scientific or technical discipline that is 13 relevant to review and advise on an air quality research 14 program. 15 We have been privileged over the years to have a 16 host of eminent scientists serve on this Committee. 17 As you know, the workload is significant and the 18 pay symbolic, at best. Their input has been invaluable to 19 the Board over the years. 20 Three excellent, extremely qualified candidates 21 have been assembled for the Board's consideration today. 22 We all have had an opportunity to review the 23 information on the candidates, and Dr. Holmes, if you 24 wouldn't mind, if you would just mention names and 25 disciplines, and then we will bring this to a conclusion. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 157 1 DR. HOLMES: Thank you, Mr. Chairman. As you said, 2 we have three names today that we believe are eligible and 3 certainly are willing to serve the Board on the Research 4 Screening Committee. 5 You have in your folders a summary of the 6 qualifications of these candidates. I will go through them 7 quickly for you. 8 Dr. John Balmes, is an Associate Professor of 9 Medicine at the University of California, San Francisco. 10 Dr. Catherine Koshland, is an Assistant Professor 11 of Environmental Health Sciences at UC Berkeley. 12 Dr. Forman Williams, is the Chairman of the 13 Department of Applied Mechanics and Engineering Sciences at 14 UC San Diego. 15 We recommend these names for your consideration as 16 Members of the Screening Committee. 17 CHAIRMAN DUNLAP: All right. Very Good. 18 BOARD MEMBER RIORDAN: I move approval, Mr. 19 Chairman. 20 BOARD MEMBER FRIEDMAN: Second. 21 CHAIRMAN DUNLAP: All right. There is a motion and 22 a second to move approval. 23 Do the Board Members have any questions or any 24 discussion on these? 25 BOARD MEMBER FRIEDMAN: I would just like to PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 158 1 comment. I read the full CV's and bibliographies, these are 2 really impressive people, who I think are going to contribute 3 very significantly to the screening process. 4 CHAIRMAN DUNLAP: Very good. Thank you. 5 Is there -- very good. We have no public 6 testimony. No one signed up. 7 Do we have any written comments? 8 All right. Very good. 9 We have a motion and a second to approve these 10 three eminently qualified professionals to serve on the 11 Research Screening Committee. 12 We will do the voice vote. 13 All those in favor, say aye. 14 Any opposed? 15 Very good. Thank you. 16 BOARD MEMBER FRIEDMAN: How many Members are there 17 now on the Committee? 18 DR. HOLMES: That brings it up to the statutorily 19 required nine. 20 CHAIRMAN DUNLAP: All right. Very good. 21 Why don't we go ahead, Dr. Holmes, why don't you 22 just sit, stay put. 23 Let's go back to the Item 98-37. 24 Ms. Walsh, why don't you take a minute and 25 reacquaint us where we left off. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 159 1 MS. WALSH: As we left, the Board had indicated a 2 desire to bifurcate, in effect, the proposal that the staff 3 had brought before you and to move ahead with a 4 noncontroversial part of that proposal, and on the second 5 issue, related to the oxygen limit, to go ahead and continue 6 that to the December meeting, at which time you will consider 7 a staff proposal, also to make a finding related to that 8 regulatory limit. 9 We have gone ahead in the lunch hour and the few 10 additional minutes that we took to make some revisions to the 11 proposed Resolution. 12 Tom Jennings of the Legal Office is prepared to 13 walk you through those briefly. 14 CHAIRMAN DUNLAP: All right. Tom, would you like 15 to do that now. 16 MR. JENNINGS: Yes. You have copies of the new 17 Resolution. 18 There aren't any changes before page four, because 19 the context in the staff's proposal didn't change. 20 I eliminated in the finding section at the bottom 21 of page four, the finding of the necessity of raising the 22 cap, and then I inserted on page five, the second, third, 23 fourth and fifth full paragraphs, contained the findings 24 regarding the possible emission impacts of raising the cap, 25 and I moved those in from the CEQA findings that had been a PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 160 1 page or two later. 2 Then on the CEQA findings, page six, I deleted the 3 references to raising the cap. Then the key actions of the 4 Board, start at the bottom of page six, and then in the now 5 therefore be it resolved that they take action, in the second 6 line, it now says amending 2262.5 A and E, that deletes the 7 subsection B that contained the raising the cap. 8 On page seven, the second, be it further resolved, 9 is the one that Chevron wanted added, and then the third, be 10 it further resolved, postpones consideration on raising the 11 cap until our December Board meeting, and the following, be 12 it further resolved, directs the staff to present at that 13 Board meeting a report on the emissions impact of the RVP 14 exemption and a recommendation on whether the Board should 15 make the finding. 16 CHAIRMAN DUNLAP: Okay. 17 Ms. Walsh, does that seem to capture what the Board 18 had directed the staff to develop? 19 MS. WALSH: Yes, Chairman Dunlap, I believe it 20 does. 21 CHAIRMAN DUNLAP: Okay. 22 Dr. Friedman, does that do it for you? 23 BOARD MEMBER FRIEDMAN: I just don't know how to 24 read lawyer language, but I think it does. 25 BOARD MEMBER ROBERTS: Tom, would you go through PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 161 1 the second paragraph on page five? 2 MR. JENNINGS: This is the paragraph starting, 3 increasing the oxygen cap? 4 It says, increasing the oxygen cap as proposed by 5 staff would have a certain impact of -- 6 CHAIRMAN DUNLAP: Are you reading verbatim what's 7 on there? 8 MR. JENNINGS: I will read it verbatim, increasing 9 the oxygen cap from 2.7 to 3.5 weight percent as proposed by 10 staff would permit the sale of gasoline containing 10 volume 11 percent ethanol as long it meets the predictive model 12 criteria, and such gasoline would be exempt from the RVP 13 standard and the reformulated gasoline regulations, unless 14 the Board makes the findings specified in 4383 OG. 15 So, that says what would happen if the Board was to 16 raise the cap from 2.7 to 3.5. 17 CHAIRMAN DUNLAP: But we are not doing that, so 18 explain to us how that explanation means that we are not 19 doing it? 20 Is it somewhere else in here? 21 MS. WALSH: What it's explaining is basically the 22 logic behind the Board's decision not to go ahead with that 23 part of the action today, saying that you've considered that, 24 you heard some concerns about the effect of that and that 25 with the possible emissions effect you want to wait until PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 162 1 December to see what those are going to be before you make a 2 final decision on that part. 3 CHAIRMAN DUNLAP: Where's the other stuff that -- 4 MR. JENNINGS: In terms of the findings on page 5 five, the fifth paragraph, in order to avoid possible 6 increases in the ozone forming potential of vehicular 7 emissions resulting from the RVP exemption, it is appropriate 8 to continue consideration of the proposed amendment of 2262.5 9 B, Title 13, California Code of Regulations, raising the 10 oxygen cap to the December 10, 1998 Board meeting, so that it 11 can be considered at the same time that the Board considers 12 whether to make the findings. 13 BOARD MEMBER FRIEDMAN: We all have the same 14 problem. 15 Why don't you, in parentheses, indicate that this 16 is Section 2262.5 B, because that is what you are deleting 17 later, at least make it clear that there is a segway to the 18 now therefore be it resolved. 19 MS. WALSH: We can make that change and make that 20 clarification. 21 BOARD MEMBER FRIEDMAN: I read it the same way. I 22 think that would take care of it. 23 BOARD MEMBER ROBERTS: It made me nervous when I 24 read that. That's all. 25 It made me feel the same way. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 163 1 CHAIRMAN DUNLAP: Why don't you orally insert that 2 in that second paragraph. 3 MS. WALSH: A cross-reference to 2262.5 B, which is 4 the section which you are deferring action on. 5 CHAIRMAN DUNLAP: Okay. That seems to do it. 6 We have before us the modified, and modified again, 7 Resolution that incorporates our concern about the oxygenate 8 cap. 9 The Chair would entertain a motion after I ask if 10 anybody has any ex parte communications they need to 11 disclose. 12 I believe I have closed the record, but, Kathleen, 13 if you think I need to run through that again, I can. 14 MS. WALSH: You are closing the record on the part 15 of this proposal other than the adoption of 2262.5 B, because 16 that will be continued to the December meeting. 17 CHAIRMAN DUNLAP: Okay. Very good. 18 In closing the record, since all written and oral 19 testimony and staff comments have been entered into the 20 record and the Board has not granted an extension of the 21 comment period, I am officially closing the record on this 22 portion of Agenda Item 98-9-2. 23 Written or oral comments received after the comment 24 period has been closed will not be accepted as part of the 25 official record on this Agenda Item. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 164 1 There is no ex parte that I am aware of. We have 2 before us this Resolution. 3 We have a motion and a second. Moved by Mr. 4 Parnell, seconded by Dr. Friedman. 5 Any further discussion that we need to have? 6 Very good. Then we will proceed with a voice vote. 7 All those in favor of approving Resolution 98-37, 8 say aye. 9 Any opposed? 10 Very good. The motion carries. 11 Thank you. Tom, thanks for working through this. 12 I appreciate it. 13 All right. That takes us to Tom, you and Dr. 14 Holmes and Mr. Barham, to talk about research proposals. 15 If I could find my file I will do justice to this 16 Item, 98-9-4. The next Item of business before the Board 17 today are these six research proposals. 18 Have all the Members of the Board had an 19 opportunity to review them? 20 Are there any additional concerns or comments by 21 Members of the Board? 22 If not, and if the Board is prepared to vote on 23 these Resolutions, we can move them. 24 BOARD MEMBER FRIEDMAN: I just wanted to say that I 25 have reviewed these pretty comprehensively and did direct PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 165 1 some questions to the Division, including getting the total 2 package for further review, and I find them all quite 3 satisfactory. 4 CHAIRMAN DUNLAP: Okay. Why don't we do this, just 5 take an extra minute, Bob, or John, why don't you just take 6 15 seconds on each and just describe, say, here is what it is 7 going to do, here is what the dollar amount is, just run 8 through all six, and then we will move on the Resolution. 9 Would you do that for us? 10 DR. HOLMES: Thank you, Mr. Chairman. It is 11 difficult to do this, but I will try. 12 Item one is a proposal from Southwest Research, a 13 demonstration of a fast-response onboard NOx sensor for 14 heavy-duty vehicles. 15 The investigator is Dan Pugner. The amount of 16 money, $348,133. 17 An important part of the SIP that was adopted last 18 year involves reductions of NOx from heavy-duty diesels. 19 This onboard NOx sensor, I think, will help us do 20 that. 21 Item two, research proposal from Automotive Testing 22 Laboratories in Southern California. Heavy-duty gasoline 23 truck evaporative emissions testing for emissions inventory, 24 $128,000,160. 25 We have evaporative emissions for automobiles and PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 166 1 for light and medium-duty trucks. We don't have a 2 corresponding bid for heavy-duty gasoline trucks. 3 These are very important, and particularly in urban 4 areas, so we want to get hard data that will incorporate 5 these vehicles into our emission inventory. 6 Item three, from Dillingham Software Engineering, 7 Incorporated, the development of Hot Spots Analysis and 8 Reporting Program. 9 As you know, we have done inventory work on hot 10 spots around the State. We have done modeling. This add-on 11 to our existing modeling package would allow us to establish 12 iso-plots, if you will, of risk in the vicinity of a 13 particular source. 14 That's very important. We could get it right down 15 to the block or the street level using the Geographic 16 Information System. 17 Item four, University of California, Davis, 18 particulate air pollution and cardiovascular morbidity, PI is 19 Dr. Mary Hong. The amount of money is $199,480. 20 This project will rely on a very large database 21 that has been gathered by the National Institute of Health. 22 It will help us establish whether or not there is a linkage 23 between cardiovascular disease and exposure to particulate 24 matter and other pollutants. 25 Item five, from the U.S. Forest Service, the PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 167 1 ambient ozone patterns and ozone injury risk to Ponderosa and 2 Jeffrey Pines in the Sierra Nevada, Michael Arvol and others. 3 The amount of money, $77,569. 4 These particular species of pine are the most 5 economically valuable to the timber industry in the State. 6 There is considerable concern that ozone damage in 7 the foothills and the Sierra are going to decrease the 8 productivity of these forests, which could eventually have a 9 major impact on the timber industry in our State. 10 Item six, a research proposal from Cal Poly, in San 11 Luis Obispo. This is a follow-up project to what we did 12 earlier to analyze the emissions from various kinds of 13 consumer products. 14 This project would add 40 more aerosol coatings to 15 that database. The amount of money is $28,885. 16 CHAIRMAN DUNLAP: Thank you, Dr. Holmes. 17 DR. HOLMES: Did that meet your specifications? 18 CHAIRMAN DUNLAP: You did quite well. 19 These projects are diverse. 20 I think, you know, I have said it time and again, I 21 know Supervisor Roberts is tired of hearing about it, but he 22 did quite a lot of work early in his tenure to educating us 23 to making sure we are getting overhead rates down and cost 24 effectiveness, and I feel good about where we are going. 25 We are policing ourselves well, as staff is, and I PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 168 1 appreciate that. So, the Chair would entertain a motion to 2 approve Resolutions 98-39, 98-40, 98-41, 98-42, 98-43 and 3 98-44, which are the Research Proposals that Dr. Holmes just 4 ran through. 5 Is there a motion? 6 BOARD MEMBER FRIEDMAN: So moved. 7 BOARD MEMBER PATRICK: Second. 8 CHAIRMAN DUNLAP: Moved by Dr. Friedman, and 9 seconded by Supervisor Patrick. 10 Any discussion that we need to have? 11 Very good. We will proceed with a voice vote. 12 All those in favor of these Resolutions, please say 13 aye. 14 Any opposed? 15 Very good. Thank you very much. 16 Okay. Open comment period. 17 This is the Item that we have had on our Agenda for 18 the last couple of years that provides for members of the 19 public to address the Board, although no formal Board action 20 may be taken, we will provide an opportunity for members of 21 the public to directly address the Board of items of interest 22 that do not appear on today's Agenda. 23 We are asking that each witness limit his or her 24 testimony to topics that are within the subject matter 25 jurisdiction of the Board to ensure that everyone has a PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 169 1 chance to speak. 2 We are also asking that each witness limit his or 3 her testimony to no more than five minutes. 4 Is there anyone that wishes to address the Board? 5 Very good. No one signed up. 6 We will move to the last Item, that will be where 7 our Communications Director, Mr. Irvin, is going to present a 8 resolution to us on Pollution Prevention Week, and I believe, 9 Joe, you have one other item you want to share with us. 10 BOARD MEMBER ROBERTS: Mr. Chairman, if I could 11 make a quick comment when we finish this? 12 CHAIRMAN DUNLAP: You bet. 13 Joe, do you want to take just a moment and talk 14 about the genesis of Pollution Prevention Week and what this 15 resolution means. 16 MR. IRVIN: Sure thing, Mr. Chairman, and Members. 17 Pollution Prevention Week has been around for quite a few 18 years now, and that is the concept that we have heard, those 19 two words together, pollution prevention, that really signal 20 a new, and now really current way of applying the way that 21 manufacturing takes place and individuals take an approach to 22 limiting pollution from getting into the atmosphere and the 23 environment. 24 The local government commission has been charged in 25 recent years with overseeing California's efforts to educate PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 170 1 the public about what pollution prevention, or P2 is. 2 As part of that, certainly Cal EPA and here at the 3 Air Resources Board, we have embraced that effort both as a 4 public outreach and part of our mission. 5 Having said that, I would like to read the 6 Resolution before you for the record. 7 Whereas Californian's are blessed with a bounty of 8 natural wonders in their State and are supportive of a clean 9 environment for all, and whereas protecting and improving the 10 environment is one of California's most important challenges, 11 and whereas the practice of pollution prevention has moved 12 from potential to practical as one of the most favorable 13 strategies for maintaining a clean environment which offers 14 industrial efficiency, economic competitiveness and 15 environmental protection, and whereas National Pollution 16 Prevention Week, September twenty-first through 17 twenty-seventh, 1998, presents an opportunity for government 18 agencies to join forces with business, industry and 19 environmental groups and individuals to educate others about 20 this common sense approach to protecting our natural 21 resources, and whereas by committing to the ethic and 22 practice of pollution prevention, the Air Resources Board 23 will meet the challenges of improving air quality consistent 24 with its mission to protect public health, while considering 25 the effects of its actions on the economy, and whereas of PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 171 1 notable importance to the pollution prevention movement is 2 the development and use of environmental technologies which 3 prevent or minimize the creation of waste streams for mobile 4 and stationary sources of air pollutants and which will 5 continue to make dramatic strides in the millennium, and 6 whereas individuals can make a difference in preventing air 7 pollution by practicing any of the ideas found in the 8 brochure, 50 Things You Can Do For Cleaner Air, which can be 9 obtained by calling the Air Resources Board at 10 1-800-End-Smog; 11 Therefore, be it resolved that the Air Resources 12 Board recognizes the week of September twenty-first through 13 twenty-seventh, 1998, as Pollution Prevention Week in 14 California, and urges its organizations, businesses and 15 citizens to participate in local and regional activities that 16 both educate and embrace the practice of pollution prevention 17 as a proven means of achieving a prosperous, healthy and 18 sustainable future for all Californians. 19 CHAIRMAN DUNLAP: Thank you. We will. 20 We have before us this Resolution 98-45. Many of 21 us have already signed it. 22 So, I would entertain a motion to approve this 23 Resolution and have it framed and displayed wherever you 24 think is appropriate, Joe. 25 So, is there a motion to approve 98-45? PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 172 1 BOARD MEMBER PATRICK: So moved. 2 CHAIRMAN DUNLAP: Moved by Supervisor Patrick, and 3 seconded by Supervisor Roberts. 4 Any discussion that we need to have further? 5 Very good. We will proceed with a voice vote. 6 All those in favor, say aye. 7 Any opposed? 8 Thank you, Joe. 9 You have one more quick item for us, and then I 10 will turn the time over to Supervisor Roberts. 11 MR. IRVIN: Okay. Mr. Chairman, and Members, I 12 wanted to bring your attention to a very beautiful poster 13 that was presented to us by the Ventura County Air Pollution 14 Control District. 15 Their Public Information Office has some very 16 creative talent. As you can see, this is a picture of the 17 sky. 18 It looks good for the camera, and a nice butterfly. 19 Anyhow, obviously this is a public outreach tool. 20 It says a few things as you look at it more, and 21 obviously we are going to have this appropriately displayed 22 here in the building. 23 Let me read to you real quickly the poem that is on 24 the back. This is from, I think I got this right, Chang 25 Chau, who is a philosopher from the third or forth century, PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 173 1 B.C. 2 He said in this poem, I do not know whether I was 3 then a man dreaming I was a butterfly, or whether I am now a 4 butterfly dreaming I am a man. 5 So, I thought about that, of course, before making 6 this presentation, it was nice for daydreaming. 7 BOARD MEMBER DeSAULNIER: I vote for butterfly. 8 MR. IRVIN: But obviously it sort of shows that the 9 symbiotic relationship we have with nature, and vice versa, 10 so I think they have kind of captured the essence of the 11 message that we all try to take to individuals in the pursuit 12 of cleaner air, and we all have a responsibility here and an 13 outcome at stake. 14 Thank you. 15 CHAIRMAN DUNLAP: We do want to recognize the 16 outreach element of the work for cleaner air. As you know, 17 there are a lot of things that you can do to touch people and 18 let them know that this is a still a concern and a problem. 19 Joe's team is a small group located on the fifth 20 floor that has been working to participate in outreach 21 advances and participated in the State Fair. Jack brought an 22 electric car over there and participated in a parade, and 23 they are doing the Gold Country Fair, and they participate, 24 as you know, in different areas around the State. 25 As you sit, particularly those Board Members that PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 174 1 come from local districts, and think we ought to have a 2 presence in your community, please let us know. Joe's people 3 will be have a small budget where they can do some 4 sponsorship of an event here and there, and they are willing 5 to do that if you think it is important. 6 Supervisor Roberts. 7 BOARD MEMBER ROBERTS: First of all, I am relieved 8 to see that wasn't the world's largest butterfly that we 9 killed. 10 I don't know what the message was in that poster, 11 but it's beautiful. I received, as part of my handouts 12 today, a report on the electric vehicle that we're involved 13 with that I'd asked for information on, and it struck me as 14 we were talking about the research reports that sometimes we 15 fund these things and we never hear about what is happening 16 to them, or what -- there is some pretty interesting 17 information that has come back on this, and somehow or other 18 it seems there should be maybe a closing of that loop, some 19 feedback that some of these, I think, these projects are so 20 esoteric that they might only have a very narrow focus and 21 their application might not be of interest to us, but I think 22 something like this WEV, the World Electric Vehicle, so 23 called, that we were the principal sponsor of, and all of the 24 things that rolled out from this in terms of production line, 25 studies and other things, I think would be of strong interest PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 175 1 to all of the Members of this Board, and I would hope that 2 maybe in the future sometime could become, you know, maybe 3 periodically, quarterly, or something, and that an item could 4 be scheduled to bring back some of the data and information 5 and some of the results of these programs. 6 CHAIRMAN DUNLAP: Okay. Mike, if could I ask 7 you -- 8 BOARD MEMBER CALHOUN: Publish a report annually to 9 give the results. 10 CHAIRMAN DUNLAP: Well, let me just say this. 11 I agree with Ron. There needs to be a better 12 feedback loop, and so, why don't we, staff, I'll ask you when 13 Mike gets back to take this up with him, but why don't we 14 have an informational item that we can get in advance of 15 every -- whether it's four times a year, or twice a year, 16 let's see what we are looking at. 17 Ron, it may be -- 18 BOARD MEMBER ROBERTS: I was just pulling out -- 19 CHAIRMAN DUNLAP: A couple times a year. 20 BOARD MEMBER ROBERTS: But, you know, I was just 21 looking at this, and it was something that I was particularly 22 interested in, and we never did have a formal report. 23 I didn't know that we had the car, and the Zebra 24 Battery was something that, you know, you brought panels in 25 here, and they worked all over the world, and we talked about PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 176 1 that, and yet, when it comes down to it and there is some 2 performance data that we somehow we were left out of the 3 loop, and I would feel better that we have a more complete 4 picture of what's going on and what we are getting for our 5 money. 6 CHAIRMAN DUNLAP: I'll just direct staff to come 7 and put on the Agenda at least twice a year and give a 8 report, a written report and an oral compliment to that on 9 what we have learned and what has happened. 10 Okay. We will do that. 11 Dr. Friedman. 12 BOARD MEMBER FRIEDMAN: I think it should be 13 analogous, not necessarily as thick, as the update that we 14 get annually on the research that we support. 15 We are making investments in more than research. I 16 think it is a very good idea. 17 It should take that same form and it would be very 18 helpful. I don't think it has to be done more than once a 19 year, to be candid. 20 What the Research Division has done, very 21 interestingly, has subdivided by year, so that the year that 22 you initiate something, you mention it and then you get 23 progress thereafter, but you start with the oldest stuff and 24 bring it right up to the present time. 25 They have done a good job. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 177 1 CHAIRMAN DUNLAP: Yeah, but, Supervisor Roberts is 2 right on the money. 3 There are some things like the USC health effects 4 work, you know, we have given a lot of money there. I get 5 regular blurbs I see internally, mail and things like this, 6 but I don't think the Board has a chance to see where those 7 millions of dollars have gone, and we have a positive story 8 to tell. 9 I'm, also, by the way, I'm comfortable with some 10 research not working out on occasion. So, staff doesn't need 11 to fret about coming back and saying, hey, we invested a 12 couple hundred thousand dollars and it didn't bear fruit. 13 That is going to happen. That is what leadership 14 is about. 15 So, on occasion, but if you do that nine out of ten 16 times, we need a new team. 17 MR. CACKETTE: On rare occasion. 18 CHAIRMAN DUNLAP: So, you don't need to fret about 19 coming back and saying something didn't work out. 20 That is my view. 21 MR. CACKETTE: If I could also point out to the 22 Board Members that on the research programs themselves, you 23 should be getting, and if you are not, look for it, there is 24 a one-page kind of glossy two-sided thing that describes what 25 we have learned from every research program and that can help PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 178 1 supplement some of this, and we will try to do that maybe on 2 more programs that aren't so researchy, but like this one, 3 which was really a partnership investment program. 4 CHAIRMAN DUNLAP: And there -- you know, we can, 5 let's try this a couple times a year thing, or less 6 frequently, but I think at least twice, even if it is just a 7 written report. 8 I am very willing, with your support, to have kind 9 of a, what would you call it, a liaison in individual 10 research projects. 11 For example, there is occasion when Joe is very 12 interested in a mobile one, you know, that he has been 13 watching for a number years and he wants to be brought in and 14 briefed, and Dr. Friedman has done that on occasion, so if 15 any of you have a research proposal in particular that you 16 like, that you want to track, we can arrange for you to be 17 briefed and brought in to working groups, I mean if you have 18 the time and inclination. We can certainly do that. 19 There is no reluctance, I don't think, to have you 20 involved. 21 By the way, on that point, today we just approved, 22 with diesel, this working group, and if you know anything as 23 Barbara knows about this San Joaquin work, you know, you 24 track what goes on there, this working group is likely to be 25 a really big deal, so I would imagine there would need to be PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 179 1 a couple of you all to participate and attend these meetings 2 when it gets up and running. 3 So, if you would maybe think -- I mean, three or 4 four if you wanted, but at least two that would want to go 5 and participate in this, it would help the Board, because 6 when we come back in a couple of years and we are looking at 7 risk management activities, you can stand up and say, hey, I 8 have been involved, here is what I have learned, or this is 9 how the process has worked out. 10 So, I think this is about inclusiveness and just 11 being kept in the loop. Ron, good point, we will make sure 12 that happens. 13 Okay. Is there anything else? 14 All right. Then the August meeting of the 15 California Air Resources Board will now adjourn. 16 (Thereupon the August meeting of the Air 17 Resources Board was adjourned at 2:10 p.m.) 18 --o0o-- 19 20 21 22 23 24 25 PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 180 1 CERTIFICATE OF SHORTHAND REPORTER 2 3 I, VICKI L. MEDEIROS, a Certified Shorthand 4 Reporter of the State of California, do hereby certify: 5 That I am a disinterested person herein; that the 6 foregoing hearing was reported in shorthand by me, Vicki L. 7 Medeiros, a Certified Shorthand Reporter of the State of 8 California, and thereafter transcribed into typewriting. 9 I further certify that I am not of counsel or 10 attorney for any of the parties to said hearing nor in any 11 way interested in the outcome of said hearing. 12 IN WITNESS WHEREOF, I have hereunto set my hand 13 this seventh day of September, 1998. 14 15 16 VICKI L. MEDEIROS 17 Certified Shorthand Reporter License No. 7871 18 19 20 21 22 23 24 25 PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345