Bill Text: CA AB2807 | 2021-2022 | Regular Session | Introduced

NOTE: There are more recent revisions of this legislation. Read Latest Draft
Bill Title: Transportation funding programs: eligibility: commercial harbor craft: public transportation ferries.

Spectrum: Partisan Bill (Democrat 2-0)

Status: (Engrossed - Dead) 2022-08-11 - In committee: Held under submission. [AB2807 Detail]

Download: California-2021-AB2807-Introduced.html


CALIFORNIA LEGISLATURE— 2021–2022 REGULAR SESSION

Assembly Bill
No. 2807


Introduced by Assembly Member Mia Bonta

February 18, 2022


An act to amend Sections 39719.2, 44272, 44274, and 44274.10 of the Health and Safety Code, and to amend Section 75230 of the Public Resources Code, relating to transportation.


LEGISLATIVE COUNSEL'S DIGEST


AB 2807, as introduced, Mia Bonta. Transportation funding programs: eligibility: public transportation ferries.
(1) Existing law establishes the California Clean Truck, Bus, and Off-Road Vehicle and Equipment Technology Program, which is administered by the State Air Resources Board, in conjunction with the State Energy Resources Conservation and Development Commission, to fund development, demonstration, precommercial pilot, and early commercial deployment of zero- and near-zero-emission truck, bus, and off-road vehicle and equipment technologies.
This bill would expand the purposes of the program to include the funding of the development, demonstration, precommercial pilot, and early commercial deployment of zero- and near-zero-emission public transportation ferry technologies.
(2) Existing law establishes the Clean Transportation Program, administered by the State Energy Resources Conservation and Development Commission, to provide funding to certain entities to develop and deploy innovative technologies that transform California’s fuel and vehicle types to help attain the state’s climate change policies. Under existing law, the commission may only provide funding under the Clean Transportation Program to specified eligible programs and projects.
This bill would expand the programs and projects that are eligible to receive funding under the Clean Transportation Program to include programs and projects that accelerate the commercialization of public transportation ferries and alternative and renewable fuels and programs and projects to retrofit fleets of public transportation ferries with technologies that create higher fuel efficiencies.
(3) Existing law establishes the Air Quality Improvement Program, administered by the State Air Resources Board, for the purpose of funding air quality improvement projects relating to fuel and vehicle technologies, including, but not limited to, providing funding for research to determine and improve the air quality impacts of alternative transportation fuels and vehicles, vessels, and equipment technologies. Under existing law, the state board is limited to providing funding under the Air Quality Improvement Program to specified eligible programs.
This bill would expand the programs that are eligible to receive funding under the Air Quality Improvement Program to include incentives for public transportation ferries, including low- or zero-emission public transportation ferries.
(4) Existing law establishes the Medium- and Heavy-Duty Zero-Emission Vehicle Fleet Purchasing Assistance Program within the Air Quality Improvement Program to make financing tools and nonfinancial supports available to operators of medium- and heavy-duty vehicle fleets to enable those operators to transition their fleets to zero-emission vehicles. Existing law requires the State Air Resources Board to designate the California Pollution Control Financing Authority as the agency responsible for administering the program.
This bill would expand the eligibility to participate in the program to operators of public transportation ferries.
(5) Existing establishes the Low Carbon Transit Operations Program, administered by the Department of Transportation, to provide operating and capital assistance for transit agencies to reduce greenhouse gas emissions and improve mobility. Existing law authorizes, among other things, capital or operating assistance for new or expanded waterborne transit as an eligible expenditure under the program.
This bill would specifically provide that expenditures related to the purchase of zero-emission public transportation ferries are an eligible expenditure under the program if the expenditure would result in new or expanded waterborne transit.
Vote: MAJORITY   Appropriation: NO   Fiscal Committee: YES   Local Program: NO  

The people of the State of California do enact as follows:


SECTION 1.

 (a) The Legislature finds and declares all of the following:
(1) Ferry service is a critical part of the state’s public transit sector carrying over 4 million passengers annually.
(2) Ferry ridership has increased dramatically as Californians look for transportation alternatives to gridlocked freeways. Over the last decade ferry ridership has doubled on the San Francisco Bay Ferry, which provides service to several counties throughout the San Francisco Bay area.
(3) The State Air Resources Board adopted regulations requiring public transit providers to transition their fleets to zero-emission technology and the state has made available some funding to offset the cost. Unfortunately, these funding programs, which tend to focus on bus and rail, often inadvertently exclude ferries.
(b) It is the intent of the Legislature that all forms of public transit, including ferries, that are required to transition their fleets to zero-emission technology as a result of state regulation be allowed to access state funding to help offset those costs.

SEC. 2.

 Section 39719.2 of the Health and Safety Code is amended to read:

39719.2.
 (a) For purposes of this section, the following terms have the following definitions:
(1) “Public transportation ferry” has the meaning set forth in subdivision (e) of Section 66540.3 of the Government Code.
(2) “Zero- and near-zero-emission” means vehicles, public transportation ferries, fuels, and related technologies that reduce greenhouse gas emissions and improve air quality when compared with conventional or fully commercialized alternatives, as defined by the state board in consultation with the State Energy Resources Conservation and Development Commission. “Zero- and near-zero-emission” may include, but is not limited to, zero-emission technology, enabling technologies that provide a pathway to emissions reductions, advanced or alternative fuel engines for long-haul trucks, and hybrid or alternative fuel technologies for trucks and off-road equipment.

(a)

(b) The California Clean Truck, Bus, and Off-Road Vehicle and Equipment Technology Program is hereby created, to be administered by the state board in conjunction with the State Energy Resources Conservation and Development Commission. The program, from moneys appropriated from the fund for the purposes of the program, shall fund development, demonstration, precommercial pilot, and early commercial deployment of zero- and near-zero-emission truck, bus, public transportation ferry, and off-road vehicle and equipment technologies. Priority shall be given to projects benefiting disadvantaged communities pursuant to the requirements of Sections 39711 and 39713.

(b)

(c) Projects eligible for funding pursuant to this section include, but are not limited to, the following:
(1) Technology development, demonstration, precommercial pilots, and early commercial deployments of zero- and near-zero-emission medium- and heavy-duty truck technology, including projects that help to facilitate clean goods movement corridors. This includes peer-to-peer truck sharing platform demonstration. Until December 31, 2021, no less than 20 percent of funding made available for purposes of this paragraph shall support early commercial deployment of existing zero- and near-zero-emission heavy-duty truck technology.
(2) Zero- and near-zero-emission bus technology development, demonstration, precommercial pilots, and early commercial deployments, including pilots of multiple vehicles at one site or region.
(3) Zero- and near-zero-emission public transportation ferry technology development, demonstration, precommercial pilots, and early commercial deployments, including pilots of multiple public transportation ferries at one site or region.

(3)

(4) Zero- and near-zero-emission off-road vehicle and equipment technology development, demonstration, precommercial pilots, and early commercial deployments, including vehicles and equipment in the port, agricultural, marine, construction, and rail sectors.

(4)

(5) Purchase incentives, which may include point-of-sale, for commercially available zero- and near-zero-emission truck, bus, public transportation ferry, and off-road vehicle and equipment technologies and fueling infrastructure to support early market deployments of alternative technologies and to increase manufacturer volumes and accelerate market acceptance.

(5)

(6) Projects that support greater commercial motor vehicle and equipment freight efficiency and greenhouse gas emissions reductions, including, but not limited to, advanced intelligent transportation systems, autonomous vehicles, grid integration and integrated storage solutions, charging management demonstration and analytics, and other freight information and operations technologies.

(c)

(d) The state board, in consultation with the State Energy Resources Conservation and Development Commission, shall develop guidance through the existing Air Quality Improvement Program funding plan process for the implementation of this section that is consistent with the California Global Warming Solutions Act of 2006 (Division 25.5 (commencing with Section 38500)) and this chapter.

(d)

(e) The guidance developed pursuant to subdivision (c) shall do all of the following:
(1) Outline performance criteria and metrics for deployment incentives. The goal shall be to design a simple and predictable structure that provides incentives for truck, bus, public transportation ferry, and off-road vehicle and equipment technologies that provide significant greenhouse gas reduction and air quality benefits.
(2) (A) Ensure that program investments are coordinated with funding programs developed pursuant to the California Alternative and Renewable Fuel, Vehicle Technology, Clean Air, and Carbon Reduction Act of 2007 (Chapter 8.9 (commencing with Section 44270) of Part 5).
(B) The State Energy Resources Conservation and Development Commission shall advise the state board on how to allocate money for vehicle charging infrastructure consistent with the commission’s investment plan strategies on charging infrastructure.
(3) Promote projects that assist the state in reaching its climate goals beyond 2030, consistent with Section 38566.
(4) Promote investments in medium- and heavy-duty trucking, including, but not limited to, vocational trucks, short-haul and long-haul trucks, buses, public transportation ferries, and off-road vehicles and equipment, including, but not limited to, port equipment, agricultural equipment, marine equipment, and rail equipment.
(5) Implement purchase incentives for eligible technologies to increase the use of the cleanest vehicles or public transportation ferries in disadvantaged communities.
(6) Allow for remanufactured and retrofitted vehicles or public transportation ferries to qualify for purchase incentives if those vehicles or public transportation ferries meet warranty and emissions requirements, as determined by the state board.
(7) Establish a competitive process for the allocation of moneys for projects funded pursuant to this section.
(8) Leverage, to the maximum extent feasible, federal or private funding.
(9) Ensure that the results of emissions reductions or benefits can be measured or quantified.
(10) Ensure that activities undertaken pursuant to this section complement, and do not interfere with, efforts to achieve and maintain federal and state ambient air quality standards and to reduce toxic air contaminants.

(e)

(f) In evaluating potential projects to be funded pursuant to this section, the state board shall give priority to projects that demonstrate one or more of the following characteristics:
(1) Benefit disadvantaged communities pursuant to Sections 39711 and 39713 or communities with a community emissions reduction program implemented pursuant to Section 44391.2.
(2) The ability to leverage additional public and private funding.
(3) The potential for cobenefits or multiple-benefit attributes.
(4) The potential for the project to be replicated.
(5) Regional benefit, with a focus on collaboration between multiple entities.
(6) Support for technologies with broad market and emissions reduction emissions-reduction potential.
(7) Support for projects addressing technology and market barriers not addressed by other programs.
(8) Support for enabling technologies that benefit multiple technology pathways.

(f)

(g) In implementing this section, the state board, in consultation with the State Energy Resources Conservation and Development Commission, shall create an annual framework and plan. The framework and plan shall be developed with public input and may use existing investment plan processes and workshops workshops, as well as existing state and third-party research and technology roadmaps. The framework and plan shall do all of the following:
(1) Articulate an overarching vision for technology development, demonstration, precommercial pilot, and early commercial deployments, with a focus on moving technologies through the commercialization process.
(2) Outline technology categories and performance criteria for technologies and applications that may be considered for funding pursuant to this section. This shall include technologies for medium- and heavy-duty trucking, including, but not limited to, vocational trucks, short-haul and long-haul trucks, buses, public transportation ferries, and off-road vehicles and equipment, including, but not limited to, port equipment, agricultural equipment, construction equipment, marine equipment, and rail equipment.
(3) Describe the roles of the relevant agencies and the process for coordination.

(g)For purposes of this section, “zero- and near-zero-emission” means vehicles, fuels, and related technologies that reduce greenhouse gas emissions and improve air quality when compared with conventional or fully commercialized alternatives, as defined by the state board in consultation with the State Energy Resources Conservation and Development Commission. “Zero- and near-zero-emission” may include, but is not limited to, zero-emission technology, enabling technologies that provide a pathway to emissions reductions, advanced or alternative fuel engines for long-haul trucks, and hybrid or alternative fuel technologies for trucks and off-road equipment.

(h) (1) In addition to the requirements of Section 44258.4, commencing with the funding plan for the 2019–20 fiscal year of the Air Quality Improvement Program (Article 3 (commencing with Section 44274) of Chapter 8.9 of Part 5), the state board shall include a three-year investment strategy that includes the immediate fiscal year and a forecast of estimated funding needs for the subsequent two fiscal years for zero- and near-zero-emission heavy-duty vehicles vehicles, public transportation ferries, and equipment commensurate with meeting the goals of this chapter and the goals of the state.
(2) The three-year investment strategy shall do all of the following:
(A) Describe the role of public investments in supporting the demonstration and deployment of advanced technologies.
(B) Provide an assessment of available funding and the investment needed.
(C) Provide a description of the state board’s portfolio of investments.
(3) The state board, in consultation with the State Energy Resources Conservation and Development Commission, shall include in the investment strategy information related to milestones achieved by the state’s schoolbus incentive programs and the projected need for funding funding, taking into consideration the state’s schoolbus inventory, turnover, and useful life.

SEC. 3.

 Section 44272 of the Health and Safety Code is amended to read:

44272.
 (a) The Clean Transportation Program is hereby created. The program shall be administered by the commission. The commission shall implement the program by regulation pursuant to the requirements of Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code. The program shall provide, upon appropriation by the Legislature, competitive grants, revolving loans, loan guarantees, loans, or other appropriate funding measures to public agencies, California federally recognized tribes, tribal organizations, vehicle and technology entities, businesses and projects, public-private partnerships, workforce training partnerships and collaboratives, fleet owners, consumers, recreational boaters, and academic institutions to develop and deploy innovative technologies that transform California’s fuel and vehicle types to help attain the state’s climate change policies. The emphasis of this program shall be to develop and deploy technology and alternative and renewable fuels in the marketplace, without adopting any one preferred fuel or technology.
(b) A project that receives more than seventy-five thousand dollars ($75,000) in funds from the commission shall be approved at a noticed public meeting of the commission and shall be consistent with the priorities established by the investment plan adopted pursuant to Section 44272.5. Under this article, the commission may delegate to the commission’s executive director, or the executive director’s designee, the authority to approve either of the following:
(1) A contract, grant, loan, or other agreement or award that receives seventy-five thousand dollars ($75,000) or less in funds from the commission.
(2) Amendments to a contract, grant, loan, or other agreement or award as long as the amendments do not increase the amount of the award, change the scope of the project, or modify the purpose of the agreement.
(c) The commission shall provide preferences to those projects that maximize the goals of the Clean Transportation Program, based on the following criteria, as applicable:
(1) The project’s ability to provide a measurable transition from the nearly exclusive use of petroleum fuels to a diverse portfolio of viable alternative fuels that meet petroleum reduction and alternative fuel use goals.
(2) The project’s consistency with existing and future state climate change policy and low-carbon fuel standards.
(3) The project’s ability to reduce criteria air pollutants and air toxics and reduce or avoid multimedia environmental impacts.
(4) The project’s ability to decrease, on a life-cycle basis, the discharge of water pollutants or any other substances known to damage human health or the environment, in comparison to the production and use of California Phase 2 Reformulated Gasoline or diesel fuel produced and sold pursuant to California diesel fuel regulations set forth in Article 2 (commencing with Section 2280) of Chapter 5 of Division 3 of Title 13 of the California Code of Regulations.
(5) The project does not adversely impact the sustainability of the state’s natural resources, especially state and federal lands.
(6) The project provides nonstate matching funds. Costs incurred from the date a proposed award is noticed may be counted as nonstate matching funds. The commission may adopt further requirements for the purposes of this paragraph. The commission is not liable for costs incurred pursuant to this paragraph if the commission does not give final approval for the project or the proposed recipient does not meet requirements adopted by the commission pursuant to this paragraph.
(7) The project provides economic benefits for California the state by promoting California-based technology firms, jobs, and businesses.
(8) The project uses existing or proposed fueling infrastructure to maximize the outcome of the project.
(9) The project’s ability to reduce on a life-cycle assessment greenhouse gas emissions by at least 10 percent, and higher percentages in the future, from current reformulated gasoline and diesel fuel standards established by the state board.
(10) The project’s use of alternative fuel blends of at least 20 percent, and higher blend ratios in the future, with a preference for projects with higher blends.
(11) The project drives new technology advancement for vehicles, vessels, engines, and other equipment, and promotes the deployment of that technology in the marketplace.
(12) The project’s ability to transition workers to, or promote employment in, the alternative and renewable fuel and vehicle technology sector.
(d) The commission shall rank applications for projects proposed for funding awards based on solicitation criteria developed in accordance with subdivision (c), and shall give additional preference to funding those projects with higher benefit-cost scores.
(e) Only the following shall be eligible for funding:
(1) Alternative and renewable fuel projects to develop and improve alternative and renewable low-carbon fuels, including electricity, ethanol, dimethyl ether, renewable diesel, natural gas, hydrogen, and biomethane, among others, and their feedstocks that have high potential for long-term or short-term commercialization, including projects that lead to sustainable feedstocks.
(2) Demonstration and deployment projects that optimize alternative and renewable fuels for existing and developing engine technologies.
(3) Projects to produce alternative and renewable low-carbon fuels in California. the state.
(4) Projects to decrease the overall impact of an alternative and renewable fuel’s life-cycle carbon footprint and increase sustainability.
(5) Alternative and renewable fuel infrastructure, fueling stations, and equipment. The preference in paragraph (10) of subdivision (c) shall not apply to renewable diesel or biodiesel infrastructure, fueling stations, and equipment used solely for renewable diesel or biodiesel fuel.
(6) Projects to develop and improve light-, medium-, and heavy-duty vehicle technologies that provide for better fuel efficiency and lower greenhouse gas emissions, alternative fuel usage and storage, or emission reductions, including propulsion systems, advanced internal combustion engines with a 40 percent or better efficiency level over the current market standard, lightweight materials, intelligent transportation systems, energy storage, control systems and system integration, physical measurement and metering systems and software, development of design standards and testing and certification protocols, battery recycling and reuse, engine and fuel optimization electronic and electrified components, hybrid technology, plug-in hybrid technology, battery electric vehicle technology, fuel cell technology, and conversions of hybrid technology to plug-in technology through the installation of safety certified supplemental battery modules.
(7) Programs and projects that accelerate the commercialization of vehicles and public transportation ferries, as defined in subdivision (e) of Section 66540.3 of the Government Code, and alternative and renewable fuels, including buy-down programs through near-market and market-path deployments, advanced technology warranty or replacement insurance, development of market niches, supply-chain development, and research related to the pedestrian safety impacts of vehicle technologies and alternative and renewable fuels.
(8) Programs and projects to retrofit medium- and heavy-duty onroad and nonroad vehicle fleets or fleets of public transportation ferries, as defined in subdivision (e) of Section 66540.3 of the Government Code, with technologies that create higher fuel efficiencies, including alternative and renewable fuel vehicles and technologies, idle management technology, and aerodynamic retrofits that decrease fuel consumption.
(9) Infrastructure projects that promote alternative and renewable fuel infrastructure development connected with existing fleets, public transit, and existing transportation corridors, including physical measurement or metering equipment and truck stop electrification.
(10) Workforce training programs related to the development and deployment of technologies that transform California’s the state’s fuel and vehicle types and assist the state in implementing its climate change policies, including, but not limited to, alternative and renewable fuel feedstock production and extraction; renewable fuel production, distribution, transport, and storage; high-performance and low-emission vehicle technology and high tower electronics; automotive computer systems; mass transit fleet conversion, servicing, and maintenance; and other sectors or occupations related to the purposes of this chapter, including training programs to transition dislocated workers affected by the state’s greenhouse gas emission policies, including those from fossil fuel sectors, or training programs for low-skilled workers to enter or continue in a career pathway that leads to middle skill, industry-recognized credentials or state-approved apprenticeship opportunities in occupations related to the purposes of this chapter.
(11) Block grants or incentive programs administered by public entities or not-for-profit technology entities for multiple projects, education and program promotion within California, the state, and development of alternative and renewable fuel and vehicle technology centers. The commission may adopt guidelines for implementing the block grant or incentive program, which shall be approved at a noticed public meeting of the commission.
(12) Life-cycle and multimedia analyses, sustainability and environmental impact evaluations, and market, financial, and technology assessments performed by a state agency to determine the impacts of increasing the use of low-carbon transportation fuels and technologies, and to assist in the preparation of the investment plan and program implementation.
(13) A program to provide funding for homeowners who purchase a plug-in electric vehicle to offset costs associated with modifying electrical sources to include a residential plug-in electric vehicle charging station. In establishing this program, the commission shall consider funding criteria to maximize the public benefit of the program.
(f) The commission may make a single source or sole source award pursuant to this section for applied research. The same requirements set forth in Section 25620.5 of the Public Resources Code shall apply to awards made on a single source basis or a sole source basis. This subdivision does not authorize the commission to make a single source or sole source award for a project or activity other than for applied research.
(g) The commission may do all of the following:
(1) Contract with the Treasurer to expend funds through programs implemented by the Treasurer, if the expenditure is consistent with all of the requirements of this article and Article 1 (commencing with Section 44270).
(2) Contract with small business financial development corporations established by the Governor’s Office of Business and Economic Development to expend funds through the Small Business Loan Guarantee Program if the expenditure is consistent with all of the requirements of this article and Article 1 (commencing with Section 44270).
(3) Advance funds, pursuant to an agreement with the commission, to any of the following:
(A) A public entity.
(B) A recipient to enable it to make advance payments to a public entity that is a subrecipient of the funds and under a binding and enforceable subagreement with the recipient.
(C) An administrator of a block grant program.
(h) The commission shall collaborate with entities that have expertise in workforce development to implement the workforce development components of this section, including, but not limited to, the California Workforce Development Board, the Employment Training Panel, the Employment Development Department, and the Division of Apprenticeship Standards.

SEC. 4.

 Section 44274 of the Health and Safety Code is amended to read:

44274.
 (a) The Air Quality Improvement Program is hereby created. The program shall be administered by the state board, in consultation with the districts. The state board shall develop guidelines to implement the program. Prior to the adoption of the guidelines, the state board shall hold at least one public hearing. In addition, the state board shall hold at least three public workshops with at least one workshop in northern California, one in the central valley, and one in southern California. The purpose of the program shall be to fund, upon appropriation by the Legislature, air quality improvement projects relating to fuel and vehicle technologies. The primary purpose of the program shall be to fund projects to reduce criteria air pollutants, improve air quality, and provide funding for research to determine and improve the air quality impacts of alternative transportation fuels and vehicles, vessels, and equipment technologies.
(b) The state board shall provide preference in awarding funding to those projects with higher benefit-cost scores that maximize the purposes and goals of the Air Quality Improvement Program. The state board also may give additional preference based on the following criteria, as applicable, in funding awards to projects:
(1) Proposed or potential reduction of criteria or toxic air pollutants.
(2) Contribution to regional air quality improvement.
(3) Ability to promote the use of clean alternative fuels and vehicle technologies as determined by the state board, in coordination with the commission.
(4) Ability to achieve climate change benefits in addition to criteria pollutant or air toxic emissions reductions.
(5) Ability to support market transformation of California’s the state’s vehicle or equipment fleet to utilize low carbon or zero-emission technologies.
(6) Ability to leverage private capital investments.
(c) The program shall be limited to competitive grants, revolving loans, loan guarantees, loans, and other appropriate funding measures that further the purposes of the program. Projects to be funded shall include only the following:
(1) On-road and off-road equipment projects that are cost effective.
(2) Projects that provide mitigation for off-road gasoline exhaust and evaporative emissions.
(3) Projects that provide research to determine the air quality impacts of alternative fuels and projects that study the life-cycle impacts of alternative fuels and conventional fuels, the emissions of biofuel and advanced reformulated gasoline blends, and air pollution improvements and control technologies for use with alternative fuels and vehicles.
(4) Projects that augment the University of California’s agricultural experiment station and cooperative extension programs for research to increase sustainable biofuels production and improve the collection of biomass feedstock.
(5) Incentives for small off-road equipment replacement to encourage consumers to replace internal combustion engine lawn and garden equipment.
(6) Incentives for medium- and heavy-duty vehicles vehicles and public transportation ferries, as defined in subdivision (e) of Section 66540.3 of the Government Code, and equipment mitigation, including all of the following:
(A) Lower emission schoolbus programs.
(B) Electric, hybrid, and plug-in hybrid on-road and off-road medium- and heavy-duty equipment.
(C) Low- or zero-emission public transportation ferries, as defined in subdivision (e) of Section 66540.3 of the Government Code.

(C)

(D) Regional air quality improvement and attainment programs implemented by the state or districts in the most impacted regions of the state.
(7) Workforce training initiatives related to advanced energy technology designed to reduce air pollution, including state-of-the-art equipment and goods, and new processes and systems. Workforce training initiatives funded shall be broad-based partnerships that leverage other public and private job training programs and resources. These partnerships may include, though are not limited to, employers, labor unions, labor-management partnerships, community organizations, workforce investment boards, postsecondary education providers including community colleges, and economic development agencies.
(8) Incentives to identify and reduce emissions from high-emitting light-duty vehicles.
(d) (1) Beginning January 1, 2011, the state board shall submit to the Legislature a biennial report to evaluate the implementation of the Air Quality Improvement Program established pursuant to this chapter.
(2) The report shall include all of the following:
(A) A list of projects funded by the Air Quality Improvement Account.
(B) The expected benefits of the projects in promoting clean, alternative fuels and vehicle technologies.
(C) Improvement in air quality and public health, greenhouse gas emissions reductions, and the progress made toward achieving these benefits.
(D) The impact of the projects in making progress toward attainment of state and federal air quality standards.
(E) Recommendations for future actions.
(3) The state board may include the information required to be reported pursuant to paragraph (1) in an existing report to the Legislature as the state board deems appropriate. The state board may also include in an existing report the description of how grant, loan, voucher, or other incentive projects that receive moneys from the Air Quality Improvement Fund are implementing the labor standards required by Chapter 3.6 (commencing with Section 39680) of Part 2, as applicable.
(e) Projects using grants, loans, vouchers, or other incentives funded in part or whole by the Air Quality Improvement Fund shall be conditioned on the requirements of Chapter 3.6 (commencing with Section 39680) of Part 2, as applicable.

SEC. 5.

 Section 44274.10 of the Health and Safety Code is amended to read:

44274.10.
 For purposes of this article, the following definitions apply:
(a) “Administering agency” means the California Pollution Control Financing Authority.
(b) “Financing tools” includes, but is not limited to, any of the following:
(1) Capital instruments, which are financing instruments that increase access to capital or other resources or reduce the cost of capital, or both, such as interest rate reductions, public-backed “soft” loans, grants, bonds, and investment aggregation, also known as warehousing.
(2) Risk reduction instruments, which are financing instruments that reduce exposure to risk or uncertainty, such as performance guarantees and asset residual value guarantees.
(3) Cost smoothing instruments, which are financing instruments that reduce and smooth up-front or recurrent costs, or both, such as operational leasing, all-inclusive leasing, also known as wet leasing, lease-purchase agreements, and on-bill financing.
(c) “Fleet” means one or more vehicles under common control or ownership.
(d) “Medium- and heavy-duty vehicle” or “vehicle” includes, but is not limited to, trucks, buses, public transportation ferries, and vehicles used for construction and earth moving purposes.
(e) “Nonfinancial supports” means technical support, such as supports for technical management of electric medium- and heavy-duty vehicles, technical assistance for financing approaches, battery health programs, and creation of residual markets, or policy action, such as policy measures to enable financing or encourage fleet transitions.
(f) “Program” means the Medium- and Heavy-Duty Zero-Emission Vehicle Fleet Purchasing Assistance Program established pursuant to Section 44274.11.
(g) “Underserved community” means any of the following communities:
(1) A low-income community as defined by paragraph (2) of subdivision (d) of Section 39713.
(2) A community identified as a disadvantaged community by the California Environmental Protection Agency pursuant to Section 39711.
(3) A community selected by the state board pursuant to Section 44391.2.
(4) A community located on lands belonging to a federally recognized California Native American tribe.
(h) “Public transportation ferry” has the meaning set forth in subdivision (e) of Section 66540.3 of the Government Code.

SEC. 6.

 Section 75230 of the Public Resources Code is amended to read:

75230.
 (a) The Low Carbon Transit Operations Program is hereby created to provide operating and capital assistance for transit agencies to reduce greenhouse gas emissions and improve mobility, with a priority on serving disadvantaged communities.
(b) Funding for the program is continuously appropriated pursuant to Section 39719 of the Health and Safety Code from the Greenhouse Gas Reduction Fund established pursuant to Section 16428.8 of the Government Code.
(c) Except as provided in subdivision (v), funding shall be allocated by the Controller on a formula basis consistent with the requirements of this part and with Section 39719 of the Health and Safety Code, upon a determination by the Department of Transportation that the expenditures proposed by a recipient transit agency meet the requirements of this part and guidelines developed pursuant to this section, and that the amount of funding requested is currently available.
(d) A recipient transit agency shall demonstrate that each expenditure of program moneys allocated to the agency reduces greenhouse gas emissions.
(e) A recipient transit agency shall demonstrate that each expenditure of program moneys does not supplant another source of funds.
(f) Moneys for the program shall be expended to provide transit operating or capital assistance that meets any of the following:
(1) Expenditures that directly enhance or expand transit service by supporting new or expanded bus or rail services, new or expanded water-borne waterborne transit, or expanded intermodal transit facilities, and may include equipment acquisition, fueling, and maintenance, and other costs to operate those services or facilities.
(2) Operational expenditures that increase transit mode share.
(3) Expenditures related to the purchase of zero-emission buses, including electric buses, and the installation of the necessary equipment and infrastructure to operate and support these zero-emission buses.
(4) Expenditures related to the purchase of zero-emission public transportation ferries, as defined in subdivision (e) of Section 66540.3 of the Government Code, and the installation of the necessary equipment and infrastructure to operate and support these zero-emission public transportation ferries if the expenditure would result in new or expanded waterborne transit pursuant to paragraph (1).
(g) (1) For a recipient transit agencies agency whose service areas include area includes disadvantaged communities, as identified pursuant to Section 39711 of the Health and Safety Code, at least 50 percent of the total moneys received pursuant to this chapter shall be expended on projects or services that meet the requirements of subdivisions (d), (e), and (f) and benefit the disadvantaged communities, as identified consistent with the guidance developed by the State Air Resources Board pursuant to Section 39715 of the Health and Safety Code.
(2) The requirement of paragraph (1) is waived if the recipient transit agencies expend agency expends the funding provided pursuant to this section on any of the following:
(A) New or expanded transit service that connects with transit service serving disadvantaged communities, as identified in pursuant to Section 39711 of, or in low-income communities, as defined in paragraph (2) of subdivision (d) of Section 39713 of, the Health and Safety Code.
(B) Transit fare subsidies and network and fare integration technology improvements, including, but not limited to, discounted or free student transit passes.
(C) The purchase of zero-emission transit buses or public transportation ferries, as defined in subdivision (e) of Section 66540.3 of the Government Code, and supporting infrastructure.
(3) Expenditures made pursuant to paragraph (2) shall be deemed to have met all applicable requirements established pursuant to Section 39713 of the Health and Safety Code.
(4) This section does not require a recipient transit agency to provide individual rider data to the Department of Transportation or to the State Air Resources Board.
(h) The Department of Transportation, in coordination with the State Air Resources Board, shall develop guidelines that describe the methodologies that a recipient transit agencies agency shall use to demonstrate that proposed expenditures will meet the criteria in subdivisions (d), (e), (f), and (g) and establish the reporting requirements for documenting ongoing compliance with those criteria.
(i) Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code does not apply to the development of guidelines for the program pursuant to this section.
(j) A recipient transit agency shall submit the following information to the Department of Transportation before seeking a disbursement of funds pursuant to this part:
(1) A list of proposed expense types for anticipated funding levels.
(2) The documentation required by the guidelines developed pursuant to this section to demonstrate compliance with subdivisions (d), (e), (f), and (g).
(k) For capital projects, the a recipient transit agency shall also do all of the following:
(1) Specify the phases of work for which the recipient transit agency is seeking an allocation of moneys from the program.
(2) Identify the sources and timing of all moneys required to undertake and complete any phase of a project for which the recipient transit agency is seeking an allocation of moneys from the program.
(3) Describe intended sources and timing of funding to complete any subsequent phases of the project, through construction or procurement.
(l) A recipient transit agency that has used program moneys for any type of operational assistance allowed by subdivision (f) in a previous fiscal year may use program moneys to continue the same service or program in any subsequent fiscal year if the agency can demonstrate that reductions in greenhouse gas emissions can be realized.
(m) Before authorizing the disbursement of funds, the Department of Transportation, in coordination with the State Air Resources Board, shall determine the eligibility, in whole or in part, of the proposed list of expense types, based on the documentation provided by the a recipient transit agency to ensure ongoing compliance with the guidelines developed pursuant to this section.
(n) The Department of Transportation shall notify the Controller of approved expenditures for each recipient transit agency, and the amount of the allocation for each agency determined to be available at that time of approval.
(o) A recipient transit agency that does not submit an expenditure for funding in a particular fiscal year may retain its funding share, and may accumulate and use that funding share in a subsequent fiscal year for a larger expenditure, including operating assistance. The recipient transit agency must first specify the number of fiscal years that it intends to retain its funding share and the expenditure for which the agency intends to use these moneys. A recipient transit agency may only retain its funding share for a maximum of four fiscal years.
(p) A recipient transit agency may, in any particular fiscal year, loan or transfer its funding share to another recipient transit agency within the same region for any identified eligible expenditure under the program, including operating assistance, in accordance with procedures incorporated by the Department of Transportation in the guidelines developed pursuant to this section, which procedures shall be consistent with the requirement in subdivision (g).
(q) A recipient transit agency may apply to the Department of Transportation to reassign any savings of surplus moneys allocated under this section to the agency for an expenditure that has been completed to another eligible expenditure under the program, including operating assistance. A recipient transit agency may also apply to the Department of Transportation to reassign to another eligible expenditure any moneys from the program previously allocated to the agency for an expenditure that the agency has determined is no longer a priority for the use of those moneys.
(r) The A recipient transit agency shall provide annual reports to the Department of Transportation, in the format and manner prescribed by the department, consistent with the internal administrative procedures for the use of the fund proceeds developed by the State Air Resources Board.
(s) The Department of Transportation and recipient transit agencies shall comply with the guidelines developed by the State Air Resources Board pursuant to Section 39715 of the Health and Safety Code to ensure that the requirements of Section 39713 of the Health and Safety Code are met to maximize the benefits to disadvantaged communities, as described in identified pursuant to Section 39711 of the Health and Safety Code.
(t) A recipient transit agency shall comply with all applicable legal requirements, including the requirements of the California Environmental Quality Act (Division 13 (commencing with Section 21000)), and civil rights and environmental justice obligations under state and federal law. This section does not expand or extend the applicability of those laws to recipient transit agencies.
(u) The audit of public transportation operator finances already required under the Transportation Development Act (Chapter 4 (commencing with Section 99200) of Part 11 of Division 10 of the Public Utilities Code) pursuant to Section 99245 of that code shall be expanded to include verification of receipt and appropriate expenditure of moneys from the program. Each recipient transit agency receiving moneys from the program in a fiscal year for which an audit is conducted shall transmit a copy of the audit to the Department of Transportation, and the department shall make the audits available to the Legislature and the Controller for review on request.
(v) Notwithstanding subdivision (c), the Controller shall allocate funding pursuant to this section for the 2019–20 to 2022–23, inclusive, fiscal years to recipient transit agencies pursuant to the individual operator ratios described in Section 99314.10 of the Public Utilities Code.

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