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REPORT:
Annual Report on AB 2766 Funds from Motor Vehicle Registration Fees for FY
2005-06
SYNOPSIS:
This report contains data on the AB 2766 Subvention Fund Program for FY 2005-06 as requested by CARB.
COMMITTEE:
Mobile Source, July 27, 2007, Reviewed
RECOMMENDED ACTION:
Approve the AB 2766 Subvention Fund Program report for FY 2005-06 for submittal to CARB.
Barry R. Wallerstein, D.Env.
Executive Officer
Background
In September 1990, Assembly Bill 2766 was signed into law authorizing a $2 motor vehicle registration fee surcharge, with a subsequent increase to $4 in 1992. Section 44223 of the Health & Safety Code (H&SC), enacted by AB 2766, specifies that this motor vehicle registration fee be used “…for the reduction of air pollution from motor vehicles pursuant to, and for related planning, monitoring, enforcement, and technical studies necessary for the implementation of, the California Clean Air Act of 1988.” Local jurisdictions receive 40% of the first $4 of each vehicle registration fee to implement projects that reduce mobile source emissions. The AQMD distributes these dollars quarterly to South Coast cities and counties based upon their prorated share of population. In 2004, a $2 surcharge was added pursuant to H&SC Section 44229 to provide a source of funding for expansion of the Carl Moyer Memorial Air Quality Standards Attainment program and to drive early introduction of clean air technology such as cleaner vehicle engines, a Lower-Emission School Bus Program, and accelerated vehicle retirement and repair programs.
Local agencies that are subvened motor vehicle registration fees for air pollution programs report annually to AQMD on their use of the fees, and the results of programs funded by the fees. The reporting by local governments follows the guidelines and methodology specified by CARB. The attached report to CARB details local government expenditures during FY 2005-06.
Summary of Subvention Fund Program Report
This report accounts for the projects, financial expenditures, quantifiable emission reductions and associated cost-effectiveness implemented by local governments through the AB 2766 Subvention Fund Program for FY 2005-06.
AQMD staff provided technical assistance to local governments including one-on-one meetings, telephone calls and training sessions to guide them in determining project eligibility, emission reduction quantification and project reporting. All 158 cities and counties receiving Subvention Funds submitted annual project reports for FY 2005-06.
During FY 2005-06, local governments received $19.6 million from motor vehicle fees and spent $20 million on mobile source emission reduction projects, spending down an accumulated balance of $28.1 million from prior years. Of the accumulated balance, approximately $18.7 million or 67% was earmarked for future projects. This represents a decrease in funds earmarked from FY 2004-05 where 72% of the ending balance was earmarked for future projects. Expenditures in the Transportation Demand Management and Alternative Fuels/Electric Vehicles categories, as in prior years, were the two highest spending categories as many local governments have directed their spending priorities to comply with employee rideshare programs and to continue their transition to cleaner fleets. However, the number of Alternative Fuels/Electric Vehicles projects as well as the overall expenditures in this category was less than in FY 2004-05, as no one local government purchased a significant number of vehicles as was the case in the previous reporting period. Quantifiable emission reductions from projects implemented during FY 2005-06 reduced 4,536 tons (VOC, NOx, PM10 and CO/7) of emissions, as estimated using EMFAC 2002, Version 2.2. This methodology is consistent with CARB methodology and has been consistent over the last three years.
The 4,536 tons of emissions reduced from projects funded during FY 2005-06 had an overall average cost-effectiveness of $0.99 per pound of emissions reduced. Excluding one outlying Traffic Management project which had a significant effect on the overall cost-effectiveness, the average cost-effectiveness would be $6.67 per pound, which is under the $10 per pound cost-effectiveness threshold established by CARB.
In accordance with H&S Code 44244.1, AB 2766 fee revenues are audited periodically by an independent auditor selected by the AQMD. Inappropriate fund use is identified by the audit team for reimbursement to the account. Further, in response to Governing Board concerns raised regarding the pooling of AB 2766 funds between local governments and Councils of Governments, a new financial reporting element was added for the Councils of Governments who received AB 2766 subvention funds from member cities and counties to provide project descriptions and fund expenditure details.
Proposal
Approve the attached staff report for submittal to CARB.
Attachment
(doc 774kb)
AB 2766 Funds Report from Motor Vehicle
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