GOVERNING BOARD AGENDA
MEETING, August 1, 2003

A meeting of the South Coast Air Quality Management District Board will be held at 9:00 a.m., in the Auditorium at AQMD Headquarters, 21865 Copley Drive, Diamond Bar, California. The Governing Board Letters and their attachments (if any) for the month of August 2003 in Microsoft Word can be downloaded (self extracting compressed) from within the individual Board letter (click on "Attachment" at the end of the letter).

Pledge of Allegiance

Opening Comments:

• William A. Burke, Ed.D., Chair
• Other Board Members
• Barry R. Wallerstein, D. Env., Executive Officer

Recognition of Outgoing Board Member Hal Bernson

• Burke

Note: Consent Calendar items held for discussion will be moved to Item No. 28.

1. Minutes of July 11, 2003 Board Meeting
McDaniel (909) 396-2500
(smcdaniel@aqmd.gov)

2. Set Public Hearing September 5, 2003 to Adopt Proposed Rule 1105.1 - Reduction of PM10 and Ammonia Emissions from Fluid Catalytic Cracking Units
Tisopulos (909) 396-3123
(ltisopulos@aqmd.gov)

Proposed Rule 1105.1 will reduce PM10 and PM10 precursors, and ammonia emissions from fluid catalytic cracking units in refineries and will implement Control Measure CMB-09 of the Air Quality Management Plan (AQMP). The proposed rule establishes emission limits for filterable PM10 and ammonia and requires periodic source testing to ensure compliance. The proposal also requires monitoring, reporting, and recordkeeping of PM10 and ammonia emissions as well as equipment operating parameters. At full implementation, the proposed rule will reduce PM10 and ammonia emissions by approximately 2 tons per day. (Review: Stationary Source Committee, November 22, 2002, February 28, 2003, March 28, 2003 and April 25, 2003)

Budget/Fiscal Impact

3. Approve Workplan for the Asthma and Outdoor Air Quality Consortium and Contract for Administering the Consortium
Wallerstein (909) 396-3131
(bwallerstein@aqmd.gov)

At the February 2003 meeting, the Board committed 10 percent of FY 2002-03 penalty revenue to fund the Asthma and Outdoor Air Quality Consortium. This action is to approve a workplan for the Consortium, end operation of a Board-established advisory committee to address conflict-of-interest concerns, and authorize a contract with UCLA to manage the Consortium and implement the workplan.

4. Execute Contracts for Projects under CARB Emission Reduction Credit Bank Program
Liu (909) 396-2105
cliu@aqmd.gov

In May 2001, AQMD and CARB entered into an agreement to implement the CARB Emission Reduction Credit Bank program to offset NOx and PM10 emissions from new or expanding peaking powerplants. In exchange for emission reduction credits, AQMD collected $257,950 from Wildflower Energy LP and $417,600 from Alliance Colton, LLC, for funding emission reduction projects in the vicinity of these facilities. Staff proposes to fund CNG refueling infrastructure projects and the purchase of an alternatively fueled heavy-duty vehicle for a total of $675,550. (Review: Technology Committee, July 25, 2003)

5. Execute Contracts for AQIP Proposals Received During Fourth Quarter of 2002
Liu (909) 396-2105
cliu@aqmd.gov

Rule 2202 - On-Road Motor Vehicle Mitigation Options was adopted on December 8, 1995. One of the compliance strategies under Rule 2202 allows employers to invest in the AQIP. Monies received are placed in a restricted account to fund programs that result in equivalent emission reductions that would otherwise have been achieved by the participating employers. Staff evaluated the proposals received during the fourth quarter of 2002 and recommends projects for funding. The amount available for this quarter is $2,114,833. (Review: Mobile Source Committee, July 25, 2003)

6. Execute Contract to Cosponsor Optimization and Demonstration of Oxidation Catalysts to Further Reduce Exhaust Emissions from CNG-Fueled Heavy-Duty Engines
Liu (909) 396-2105
cliu@aqmd.gov

Recent studies have shown that oxidation catalysts (OXCAT) could further reduce non-methane hydrocarbon emissions (including toxic hydrocarbon emissions such as formaldehyde) from CNG heavy-duty engines by at least 85 percent. The OXCAT technology can also reduce CO and PM emissions from heavy-duty CNG engines. The emission-reduction potential of OXCAT, however, has not been fully realized because the majority of current CNG-fueled vehicles (in particular, transit buses) in the Basin either are not equipped with OXCATs or the OXCAT technology has not been fully optimized to reduce exhaust emissions. The proposed project is to optimize and demonstrate the OXCAT technology to further reduce exhaust emissions in existing CNG-fueled engines used in transit bus applications. The total project cost is $400,000, with the AQMD share not to exceed $365,000. (Review: Technology Committee, July 25, 2003)

7. Execute Contract to Cost Share Demonstration of Technologies to Reduce PM Emissions From Airport Ground Support Equipment in South Coast Basin
Liu (909) 396-2105
cliu@aqmd.gov

Airport ground support equipment (GSE) contribute significantly to airport NOx, PM, and toxics emissions. On December 6, 2002, the Board approved the issuance of an RFP to solicit proposals for developing and demonstrating control technologies for GSE to reduce particulate matter emissions at airports. Staff proposes to award a contract to Engine Control Systems, Ltd for an amount not to exceed $778,552. The contract funding for this demonstration program will be equally cost shared by the Air Transport Association. (Review: Technology Committee, July 25, 2003)

8. Issue RFP to Solicit Projects for FY 2002-03 Carl Moyer Memorial Air Quality Standards Attainment Program Funding
Liu (909) 396-2105
cliu@aqmd.gov

The State’s FY 2002-03 budget contains $19.5 million to continue the Carl Moyer Program. The AQMD expects to receive $8,148,088 of this funding. Returned Moyer Program funds from previous years' awards totaling $4,196,732, and $1,100 in rollover funds from last year, will also be available. Staff recommends the release of an RFP for $12.3 million to provide incentives for low emission on- and off-road vehicles and equipment. Staff also recommends the award of $19,774 allocated by CARB to an interdistrict project. (Review: Technology Committee, July 25, 2003)

9. Execute Contract to Obtain Technical and Functional Support for Upgrading PeopleSoft Financials System Software
Marlia (909) 396-3148
cmarlia@aqmd.gov

On May 2, 2003, the Board approved release of an RFP to obtain technical and functional support for upgrading AQMD’s PeopleSoft Financials System Software to a new release. Keeping relatively current on new software releases is important for enterprise software systems such as PeopleSoft. Without upgrading to new releases, AQMD will not benefit from delivered software enhancements and technology advances that improve productivity, flexibility, and efficiency. Additionally, manufacturer’s technical support for the current Release 7.5 will end in December, 2004. This action is to execute a contract for technical and functional support during the upgrade process. Funds ($160,000) for this purchase are included in the FY 2003-04 Budget. (Review: Administrative Committee, July 18, 2003)

10. Approve Task Orders for Previously Approved Contracts for Ethnic Community Outreach and Amend Existing Contract with Oralia Michel Marketing & Public Relations
Abarca (909) 396-3242
(oabarca@aqmd.gov)

At its March 16, 2001 meeting, the Board approved allocation of $1.5 million for enhanced education and outreach to African-American, Hispanic, and Asian-American communities in the South Coast. The Board subsequently authorized staff to execute initial level-of-effort contracts with consulting teams, under which a series of detailed task orders were approved by the Board in December 2001, April 2002, July 2002 and March 2003. This item sets forth the next set of task orders, deliverables, and timelines for the outreach campaigns. In addition, a “no-cost” extension of the contract with Oralia Michel Marketing & Public Relations is proposed. (Review: Administrative Committee, July 18, 2003)

11. Recognize and Appropriate Grant Funds from U.S. EPA for Boiler Tune-Up Outreach Program
Ganguli (909) 396-3185
(aganguli@aqmd.gov)

U.S. EPA has awarded the AQMD $100,000 in Section 103 grant funds to implement a multi-agency program to assist small businesses in performing regular boiler tune-ups. AQMD will work with U.S. EPA and the small business assistance programs in Hawaii, Nevada, and Arizona to develop and implement the program using grant funds. (Review: Stationary Source Committee, July 25, 2003)

12. Recognize Revenues from U.S. Department of Defense for Adaptation of Urban Air Monitoring Instruments to Demonstrate Feasibility to Measure Low Level Pollutant Concentrations
Hogo (909) 396-3184
hhogo@aqmd.gov

An AQMD proposal has been selected for award by the U.S. Department of Defense (DOD) for the adaptation of urban air monitoring instruments to measure low level pollutant concentrations in an amount of $900,000. Under the provided funding, the AQMD will evaluate various, and purchase the best suited, measurement instruments to detect low level concentrations. This action is to recognize the revenue of $900,000 and execute a contract with DOD to conduct the study. (Review: Administrative Committee, July 18, 2003)

13. Recognize and Appropriate Funds for Special Particulate Air Monitoring Program
Hogo (909) 396-3184
hhogo@aqmd.gov

As part of a special national monitoring program, the U.S. EPA requested assistance from the AQMD to collect samples at various AQMD monitoring stations. This special particulate monitoring program is fully funded through the U.S. EPA, with a total allocation of $1,017,466. The federal FY 2003 portion is $415,858, with the FY 2004 portion being $601,608. This action is to recognize $1,017,466 for the monitoring program upon receipt and appropriate these funds to the FY 2003-04 Budget. (Review: Administrative Committee, July 18, 2003)

14. Approve Contract Awards as Part of MSRC's FYs 2001-02, 2002-03 and 2003-04 AB 2766 Discretionary Fund Work Programs; Grant MSRC Authority to Adjust Project Costs Up to Five Percent; and Authorize Board Chairman to Execute Agreements
Kleindienst

On October 4, 2002, the Board approved the FY 2002-03 AB 2766 Discretionary Fund Work Program in Concept totaling $14.95 million, including $1.25 million for the implementation of strategically located, publicly accessible alternative fuel infrastructure in the SCAQMD. Subsequently, on July 24, 2003, the MSRC approved five awards at $250,000 per station totaling $1.25 million under the infrastructure program as part of the FY 2002-03 Work Program. At the same meeting, the MSRC also unanimously approved: 1) a replacement contract to Long Beach Transit Agency for $684,837 for the installation of 99 retrofit traps as part of the FY 2001-02 Work Program; and 2) an allocation of $146,385 to exercise the second-year option for FY 2003-04 technical advisor services, $109,789 as part of the FY 2003-04 Conceptual Work Program and $36,596 as part of the FY 2003-04 5% Administrative Budget. The MSRC seeks AQMD approval of these seven contract awards and authority to adjust project costs up to five percent and for the Board Chairman to execute these multiple agreements.

Action Items/No Fiscal Impact

15. Amend Governing Board Meeting Procedures Regarding Receipt of Public Testimony
(Continued from July 11, 2003 Board Meeting)
Burke

Chairman Burke has advised that Board meetings will proceed in a more orderly fashion if members of the public submit speaker cards before the meetings begin. An amendment to make the necessary changes to the Board meeting procedures is therefore proposed.

16. Adopt Resolution for Eligibility with State of California to Receive Property under Federal Surplus Personal Property Program
Hogo (909) 396-3184
hhogo@aqmd.gov

The State of California periodically surpluses equipment that is of value to the AQMD such as ambient monitoring equipment. In order for the AQMD to receive this equipment, the State requires that the AQMD apply for and receive “donee” status through the Federal Surplus Personal Property Program. The State further requires the Board to adopt a resolution for such an application. Approval of the application will allow the AQMD to receive surplus property items from the federal government. (Review: Administrative Committee, July 18, 2003)

17. Audit Report of AB 2766 Fee Revenue Recipients for FYs Ending June 30, 2000 and 2001, and Set Public Hearing September 5, 2003 Regarding Final Resolution of Unresolved Audit Findings and Recommendations
Pearce (909) 396-2828
(rpearce@aqmd.gov)

Health and Safety Code 44244.1 requires any agency that receives fee revenues subvened from the Department of Motor Vehicles to be audited once every two years. This audit of AQMD's share, MSRC's share, and local governments' share of such subvened funds, performed by independent Certified Public Accountants, has been completed. (Review: Administrative Committee, July 18, 2003)

Information Only - Receive and File

18. Public Affairs Report
Abarca (909) 396-3242
(oabarca@aqmd.gov)

This report highlights the June 2003 outreach activities of Public Affairs which include: Environmental Justice Update, Community Events/Public Meetings, Business Assistance, and Local Governmental Activity.

19. Hearing Board Report
Camarena (909) 396-2500
(ecamarena@aqmd.gov)

This reports the actions taken by the Hearing Board during the period of  June 1 through June 30, 2003.

20. Civil Filing and Civil Penalties Report
Mieras (909) 396-3400
(pmieras@aqmd.gov)

This reports the monthly penalties from May 1 through May 31, 2003, and legal actions filed by the District Prosecutor during June 1 through June 30, 2003. A glossary explaining the key terms and Index of District Rules are attached with the penalty report.

21. Lead Agency Projects and Environmental Documents Received by AQMD Between June 1, 2003 and June 30, 2003
Chang (909) 396-3186
(echang@aqmd.gov)

This report provides, for the Board's consideration, a listing of CEQA documents received by the AQMD between June 1, 2003 and June 30, 2003, and those projects for which the AQMD is acting as lead agency pursuant to CEQA. (Review: Mobile Source Committee, July 25, 2003)

22. Rule and Control Measure Forecast
Chang (909) 396-3186
(echang@aqmd.gov)

This report highlights AQMD rulemaking activity and public workshops potentially scheduled for the year 2003.

23. Recommendation Regarding Comments to U.S. EPA on Proposed Rule to Implement Eight-Hour National Ambient Air Quality Standard for Ozone
Chang (909) 396-3186
(echang@aqmd.gov)

On June 2, 2003, U.S. EPA published a Proposed Rule to Implement the Eight-Hour Ozone National Ambient Air Quality Standard. The proposed rule addresses numerous issues related to implementation of the new eight-hour standard, including attainment deadlines, planning requirements, emission controls, and other matters. Most significantly, the proposed rule would revoke the current one-hour standard and its year 2010 attainment deadline for the South Coast District, and establish an attainment deadline for the eight-hour standard that could be as late as the year 2021. This agenda item presents staff’s recommendations regarding comments on the proposed rule. The comments support expeditious but reasonable attainment deadlines, and seek to maintain progress towards healthful air quality. (Review: Mobile Source Committee, July 25, 2003)

24. Status Report on Major Projects for Information Management Scheduled to Start During First Six Months of FY 2003-04
Marlia (909) 396-3148
cmarlia@aqmd.gov

Information Management is responsible for data systems management services in support of all AQMD operations. This action is to report on major automation contracts and projects to be initiated by Information Management during the first six months of FY 2003-04.

25. Report of RFPs and RFQs Scheduled for Release in August
Pearce (909) 396-2828
(rpearce@aqmd.gov)

This report summarizes the RFPs and RFQs for budgeted services over $50,000 scheduled to be released for advertisement for the month of August. (Review: Administrative Committee, July 18, 2003)

26. Progress Report on Installation of NOx Control Equipment at RECLAIM Facilities, and RECLAIM Trading Activities
Coy (909) 396-2434
(ccoy@aqmd.gov)

On May 11, 2001 the Board amended Regulation XX - RECLAIM, to address increased demand for NOx RTCs due to California's energy crisis. The amendments sought to reduce demand for RTCs from power producing facilities by imposing restrictions on their trading activities and requiring them to install Best Available Retrofit Control Technologies. Additionally, the amendments also imposed a requirement for larger RECLAIM facilities to implement plans to ensure compliance with annual NOx allocations either by installing control equipment, making process modifications, or purchasing NOx RTCs. To improve market efficiency, the amendments required additional trade information and more timely disclosure of trade activities. This report summarizes information regarding permit applications received by AQMD since May 2001 for installation of NOx control equipment and quarterly trading activities. This information has been provided to the Stationary Source Committee on a monthly basis.

27. Report on Emission Limits for Rule 1136 - Wood Product Coatings
Tisopulos (909) 396-3123
(ltisopulos@aqmd.gov)

Rule 1136 requires operators to submit progress reports and staff to evaluate the state of current technology toward meeting the future effective VOC limits of July 1, 2005. Based on the reports submitted and staff's evaluation, technology exists to support the future limits for all coating categories. (Review: Stationary Source Committee, June 27, 2003)

28. Items Deferred from Consent Calendar

Note: The June 26, 2003 MSRC meeting was canceled; the next meeting is scheduled for July 24, 2003.

29. Administrative Committee
Chair: Bernson
Wallerstein (909) 396-3131
(bwallerstein@aqmd.gov)

30. Legislative Committee
Chair: LaPisto-Kirtley
Abarca (909) 396-3242
(oabarca@aqmd.gov)

The Legislative Committee considered agenda items including the following legislation for which the Board will consider approving a position:

31. Mobile Source Committee
Chair: Wilson
Chang (909) 396-3186
(echang@aqmd.gov)

32. Stationary Source Committee
Chair: Loveridge
Coy (909) 396-2434
(ccoy@aqmd.gov)

33. Technology Committee
Chair: Paulitz
Liu (909) 396-2105
cliu@aqmd.gov

34. California Air Resources Board Monthly Report
(No Written Material - Transcripts of the meetings are available at CARB's web site, www.arb.ca.gov)
Board Rep: Burke
McDaniel (909) 396-2821
(smcdaniel@aqmd.gov)

PUBLIC HEARINGS

35. Adopt 2003 Revision to Air Quality Management Plan and Certify Final Environmental Impact Report
Chang (909) 396-3186
(echang@aqmd.gov)

On February 25, 2003, staff released the draft 2003 AQMP to satisfy both federal and state Clean Air Act requirements, address the attainment demonstration requirements of the federal Clean Air Act for one-hour ozone, PM10, and carbon monoxide, and establish transportation emission budgets based on the latest approved motor vehicle emissions model and planning assumptions. The Draft Environmental Impact Report (EIR) for the 2003 AQMP was also released for public review on April 8, 2003. Proposed modifications to the draft 2003 AQMP were released on June 6, 2003 to incorporate revisions to the emissions inventory, control strategy, modeling, and transportation budgets. Written comments received were considered in preparing the draft final 2003 AQMP. A Final EIR incorporating comments received has also been prepared for the Board’s consideration. (Review: Mobile Source and Stationary Source Committees, June 27 and July 25, 2003)

36. Adopt 2003 Coachella Valley PM10 State Implementation Plan
Tisopulos (909) 396-3123
(ltisopulos@aqmd.gov)

On June 21, 2002, the AQMD adopted the 2002 Coachella Valley PM10 State Implementation Plan (2002 CVSIP), which included a request for extension of the PM10 deadline and met all applicable federal CAA requirements, including a Most Stringent Measures analysis, control measures, and attainment demonstration. U.S. EPA approved the 2002 CVSIP on April 18, 2003. At the time of the 2002 CVSIP adoption, the AQMD committed to revising the emissions inventories, emission budgets, and attainment modeling with the latest approved mobile source emissions estimates and planning assumptions, when they became available. The 2003 CVSIP updates those elements of the 2002 CVSIP; the control strategies and control measure commitments have not been revised and remain the same as in the 2002 CVSIP. (Review: Mobile Source Committee, June 27, 2003 and July 25, 2003)

OTHER BUSINESS

PUBLIC COMMENT PERIOD - (Public Comment on Non-Agenda Items, Pursuant to Government Code Section 54954.3)

CLOSED SESSION – (No Written Material)
Baird (909) 396-2302
(bbaird@aqmd.gov)

It is necessary for the Board to recess to closed session pursuant to Government Code section 54956.9(a) to confer with its counsel regarding pending litigation which has been initiated formally and to which the District is a party. The actions are: California Paint Alliance, et al. v. South Coast Air Quality Management District, et al., United States District Court Case No. CV-03-1656HLH (JWJx); National Paint & Coatings Association, Inc. v. South Coast Air Quality Management District, United States District Court Case No. CV-03-1578HLH (JWJx); Engine Manufacturers Association, et al. v. SCAQMD, et al., United States Supreme Court Case No. 02-1343; Viaz, et al. v. South Coast Air Quality Management District, et al., Los Angeles Superior Court Case No. LC062706; and People of the State of California ex rel South Coast Air Quality Management District v. BP West Coast Products, LLC, et al., Los Angeles Superior Court Case No. BC291876. It is also necessary for the Board to recess to closed session pursuant to Government Code section 54956.9(c) to confer with its counsel regarding determining whether to initiate litigation (two cases).

ACRONYMS

AQIP = Air Quality Investment Program
AVR = Average Vehicle Ridership
Cal/EPA = California Environmental Protection Agency
CARB = California Air Resources Board
CEMS = Continuous Emissions Monitoring Systems
CEQA = California Environmental Quality Act
CE-CERT = College of Engineering-Center for Environmental Research and Technology
CNG = Compressed Natural Gas
CO = Carbon Monoxide
CTG = Control Techniques Guideline
EJ = Environmental Justice
EPA = Environmental Protection Agency
EV = Electric Vehicle
FY = Fiscal Year
HRA = Health Risk Assessment
IAIC = Interagency AQMP Implementation Committee
IGA = Intergovernmental Affairs
LAER = Lowest Achievable Emissions Rate
LEV = Low Emission Vehicle
LNG = Liquefied Natural Gas
MOU = Memorandum of Understanding
MSERCs = Mobile Source Emission Reduction Credits
MSRC = Mobile Source (Air Pollution Reduction) Review Committee
NESHAPS = National Emission Standards for Hazardous Air Pollutants
NGV = Natural Gas Vehicle
NOx = Oxides of Nitrogen
NSPS = New Source Performance Standards
NSR = New Source Review
PAMS = Photochemical Assessment Monitoring Stations
PAR = Proposed Amended Rule
PM₁₀ = Particulate Matter < 10 microns
PM_2.5 = Particulate Matter < 2.5 microns
PR = Proposed Rule
RFP = Request for Proposals
RFQ = Request for Quotations
SCAG = Southern California Association of Governments
SIP = State Implementation Plan
SOx = Oxides of Sulfur
TCM = Transportation Control Measure
ULEV = Ultra Low Emission Vehicle
VMT = Vehicle Miles Traveled
VOC = Volatile Organic Compound
ZEV = Zero Emission Vehicle