AB 985: San Joaquin Valley Unified Air Pollution Control District: emission reduction credit system.

Existing law imposes various limitations on emissions of air contaminants for the control of air pollution from vehicular and nonvehicular sources. Existing law generally designates the State Air Resources Board as the state agency with the primary responsibility for the control of vehicular air pollution and air pollution control and air quality management districts with the primary responsibility for the control of air pollution from all sources other than vehicular sources.

Existing law requires the board of every air district to establish by regulation a system by which all reductions in the emission of air contaminants that are to be used to offset certain future increases in the emission of air contaminants be banked prior to use to offset future increases in emissions, except as specified. Existing law requires the state board to develop and adopt a methodology for use by air districts to calculate the value of credits issued for emission reductions from stationary, mobile, indirect, and areawide sources when those credits are used interchangeably, consistent with certain requirements. Existing law also requires the state board to periodically update the methodology as it applies to future transactions, if necessary.

Existing law provides for the establishment of the San Joaquin Valley Unified Air Pollution Control District vested with the authority to regulate air emissions from stationary sources located in the San Joaquin Valley Air Basin.

This bill would require the state board, except as provided, to conduct an analysis of each credit identified in the San Joaquin Valley Unified Air Pollution Control Districts ledger of available emission reduction credit banks for certain pollutants credits to determine if any credits were issued in violation of state, local, or district laws, rules, regulations, or procedures in place at the time of original issuance, and to complete the analysis no later than January 1, 2027. As part of the analysis, the bill would require the state board to ensure that emission reduction credits are deemed invalid if they were issued in violation of state, local, or district laws, rules, regulations, or procedures in place at the time of original issuance. If the invalidation of those credits leads, or would have led, to the districts program failing to meet applicable federal emission reduction requirements, the bill would require current and future credits to be valued at the time of use. The bill would also require the state board to conduct a stationary source analysis for all permits in the district that use a credit for oxides of nitrogen (NOx), volatile organic compounds (VOCs), or a pollutant for which the invalidation of credits leads, or would have led, to the failure to meet federal requirements, as provided. The bill would require, upon completion of the analyses, analysis, the state board to submit a report to the Legislature that includes a summary of the results of the analyses. analysis.

This bill would require the district to aggregate and make publicly available on its internet website specified information regarding permits issued during a specified time period that require or required the use of one or more emission reduction credits. By adding to the duties of the district, this bill would impose a state-mandated local program.

This bill would make legislative findings and declarations as to the necessity of a special statute for the San Joaquin Valley Air Basin.

The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

This bill would provide that no reimbursement is required by this act for a specified reason.