Kathleen Hartnett White, Chairman 

Larry R. Soward. Commissiorzer 

Martin A. Hubert, Commissioner 

Glenn Shankle, Executi~~e Director 

TEXAS COMMISSION ON ENVIRONMENTAL QUALITY 

Protecting Texas by Reducing and Preventir7g Pollution 

October 10, 2006 

Docket No. 2005-2006-RUL 

Richard E. Greene, Regional Administrator 

U.S. Environmental Protection Agency - Region 6 

1445 Ross Avenue 

Dallas, Texas 75202-2733 

Dear Mayor Greene: 

On September 20, 2006, the Texas Commission on Environmental Quality (Commission) adopted revisions to 

the State Implementation Plan (SIP). I- 3 

- 3 il 

- i. I . c-. 

The Commission adopted amendments to 30 TAC Chapter 114, Control of Air Pollution from Motor L , 73 (-1 ;-?I Vehicles, Subchapter K, Mobile Source Incentive Programs, Division 3, Sections 114.620, 114.622, ne&y -4 c-3 Section 114.624; and Subchapter K, new Division 4, new Sections 114.640, 114.642, 114.644, 1 14.8T55ndz 

114.648; and corresponding revisions to the SIP. The adoption implements House Bill 3469 and Houk all - 

248 1, 79th Legislature, 2005, Regular Session. The adopted rulemaking establishes rules for the ~ex&flea<? CC 

TrT School Bus Program as directed by House Bill 3469. The adopted rulemaking also clarifies cost effectiqesS3 .. requirements for the Texas Emissions Reduction Plan, establishes a rebate grant program as part of the BasLq 

Emissions Reduction Plan, and clarifies scrappage requirements for repower and replacement projects u&r cn 

the Texas Emissions Reduction Plan grant program as provided in House Bill 248 1. 

Enclosed are the proposed revisions to the SIP, a public hearing certification, a complete record of the public 

hearing, and the accompanying order. I look forward to your expeditious approval of these SIP revisions. 

Sincerely, 

Fathleen Hartnett White 

Chairman 

Logged ir-3 

P.O. Box 13087 Austin, Texas 78711-3087 512,239-1000 Internet address: www.tcel dac 

pr,:,te~I <,r, I;L\.I+J p,,:~~,r ~!,\::2 >,I, htt>?d 

i~a
Richard E. Greene, Regional Administrator 

Page 2 

October 10, 2006 

Enclosures 

cc: The Honorable Rick Perry, Governor of Texas 

Mr. Zak Covar, Office of Budget, Planning and Policy, Office of the Governor 

Mr. Glenn Shankle, Executive Director, Texas Commission on Environmental Quality 
THE STATE OF TEXAS $ 

COUNTY OF TRAVIS $ 

This is to certify that the attached are true and correct copies of documents for revisions to the Texas 

State Implementation Plan, adopted on September 20, 2006, pursuant to 40 Code of Federal Regulations 

(CFR) $51.104. I am the records administrator for the General Law Division of the Texas Commission on 

Environmental Quality. 

Director, General Law Division 

Texas Commission on Environmental Quality 
06 OCT I 3 F?l 2: :f, 

Texas Commission on 

Environmental Quality 

Public Hearing 

May 9,2006 

Concerning Revisions to Chapter 114, 

Control of Air Pollution from Motor Vehicles 

House Bill 3469 and House Bill 2481: 

Texas Clean School Bus Program 

Rule Project No. 2006-01 6-1 14-EN 
INTRODUCTION 

The Texas Commission on Environmental Quality (commission) held a public hearing in Austin on 

May 9, 2006, to receive testimony concerning revisions to 30 TAC Chapter 114, Control of Air 

Pollution from Motor Vehicles. 

The adopted rulemaking implements House Bill 3469 and House Bill 2481,79th Legislature, 2005. 

The adopted rulemaking establishes rules for the Texas Clean School Bus Program as directed by 

House Bill 3469, clarifies cost effectiveness requirements for the Texas Emissions Reduction Plan, 

establishes a rebate grant program as part of the Texas Emissions Reduction Plan, and provides for 

clarification of scrappage requirements for repower and replacement projects under the Texas 

Emissions Reduction Plan grant program as provided in House Bill 2481. 

The comment period closed on May 16, 2006. All testimony and comments have been reviewed 

and seriously considered. This hearing record contains a complete record of the public hearing and 

is divided into the following four sections: 

0 Public Notification and Proposal 

0 Written and Oral Testimony 

0 Evaluation of Testimony 

o Staff Recommendations/Order 

Additional copies of this hearing record are maintained in the TCEQ central office at 12100 Park 35 

Circle, Austin, Texas 78753. For further information, please contact Erik Gribbin at (512) 239-2590. 
PUBLIC 

NOTIFICATION AND 

PROPOSAL 
PUBLIC NOTIFICATION 

Notification to the public of the proposed revisions was conducted by the following procedures: 

1. Publication of notice of public hearings in the following newspapers on the date listed: 

Austin American Statesman; April 3, 2006 

Fort Worth Star-Telegram; April 3, 2006 

Houston Chronicle; April 3, 2006 

2. Publication of the proposed rules in the April 14, 2006, issue of the Texas Register 

(3 1 TexReg 31 87). 

3. Publication of the Notice of Public Hearing in the April 14, 2006, issue of the Texas Register 

(3 1 TexReg 3287). 

4. Correspondence forwarding the notice of public hearings to the following officials and agencies: 

Speaker of the House 

Lieutenant Governor 

City of Victoria Planning Department 

Dallas Department of Environmental and Health Services 

Dallas Department of Aviation 

El Paso City-County Health and Environmental District 

El Paso Metropolitan Planning Organization 

Federal Highway Administration 

Fort Worth Environmental Management Department 

Galveston County Health District 

Houston Department of Health and Human Services 
Harris County Pollution Control Department 

North Central Texas Council of Governments 

Houston-Galveston Area Council 

South East Texas Regional Planning Commission 

Texas Department of Transportation 

Texas Transportation Institute 

Arkansas Department of Pollution Control and Ecology 

Louisiana Department of Environmental Quality 

New Mexico Environmental Department 

Oklahoma Department of Environmental Quality 

U. S. Environmental Protection Agency 
Example of Newspaper Classified Ad 

Fort Worth Sfar-Telegram, April 3, 2006 
specific general permit. 

Further information may also be 

Quality Division, Storm Water 

4671. 

Si desea informacion en Espanol, uede llamar 1-800-687-4040, P 

TRD-200601994 

LaDonna Castariuela 

Chief Clerk 

Texas Commission on Environmen al Quality 

Filed: April 4. 2006 1 

Notice of Public Hearing on Proposed Revisions to 30 TAC 

Chapter 114 

The Texas Commission on Environmental Quality will conduct a public hearing to receive testimony concerning revisions to 30 TAC Chapter 114, Control of Air Pollution eom Motor Vehicles, under the requirements of Texas Health and Safety Code, $382.017; Texas Government Code, Chapter 2001, Subchapter B; and 40 Code of Federal Regulations $5 1.102, of the United States Environmental Protection Agency 

(EPA) regulations concerning state implementation plans (SIPS). 

The proposed rulemaking would implement House Bill 3469 and 

House Bill 2481, 79th Legislature, 2005. The proposed rulemaking 

would establish rules for the Texas Clean School Bus Program as 

directed by House Bill 3469. The proposed rulemaking would also 

clarify cost effectiveness requirements for the Texas Emissions Reduction Plan, establish a rebate grant program as part of the Texas 

Emissions Reduction Plan, and provide for clarification of scrappage 

requirements for repower and replacement projects under the Texas 

Emissions Reduction Plan grant program as provided in House Bill 

2481. 

A public hearing on this proposal will be held in Austin, Texas on May 

9,2006, at 2:00 p.m. at the Texas Commission on Environmental Quality in Building F, Room 2210, located at 121 00 Park 35 Circle. The 

hearing will be structured for the receipt of oral or written comments 

by interested persons. Individuals may present oral statements when 

called upon in order of registration. There will be no open discussion 

during the hearing; however, an agency staff member will be available 

to discuss the proposal 30 minutes prior to the hearing. 

Persons who have special communication or other accommodation 

needs who are planning to attend the hearing should contact Holly 

Vierk, Office of Legal Services, at (512) 239-0177. Requests should 

be made as far in advance as possible. 

Comments may be submitted to Holly Vierk, MC 205, Texas Register 

Team, Office of Legal Services, Texas Commission on Environmental 

Quality, P.O. Box 13087, Austin, Texas 78711-3087 or faxed to (512) 

239-4808. All comments should reference Rule Project Number 2006- 

016-1 14-EN. Comments must be received by 5:00 p.m., May 16,2006. 

Copies of the proposed rules can be obtained from the commission's 

Web site at http://w. tceq.state. tx. us/nav/nrles/propose_adopt. html. 

For further information, please contact Erik Gribbin, Air Quality Planning and Implementation Division, at (5 12) 239-2590. 

TRD-200601935 

Stephanie Bergeron Perdue 

Acting Deputy Director, Office of Legal Services 

Texas Commission on Environmental Quality 

Filed: March 31, 2006 

Revisions to 30 TAC 

The Texas Commission on 

sion) will conduct a public 

visions to 30 TAC Chapter 

ments of Texas Health and 

ment Code, Chapter 2001, 

islature, 2001, tha 

Persons planning to attend the aring who have special communication or other accommodation ne ds should contact Lola Brown, Office 

of Legal Services, at (512) 239- 348. Requests should be made as far 

in advance as possible. I 

IN ADDITION April 14,2006 31 TexReg 3287 
pkmbie eeltfleil]; 

fficers of all [Medid] providers of 

der arrangement. 

This agency hereby that the proposal has been reviewed 

by legal counsel be within the agency's legal authority to adopt. 

Filed with the Office oft e Secretary of State on April 3, 2006. 

TRD-200601986 

Cathy Campbell 

General Counsel 

Department of State Healt Services 

Earliest possible date of a option: May 14,2006 

For further information, pi se call: (512) 458-7111 x6972 

+ I + + 

25 TAC 5419.460 

Ith and Safety Code, 5534.052, 

rules necessary and appropriate 

to ensure the a ion of community based mental 

health services mental health authority; Health 

, which requires the department 

rehabilitation programs are availThe repeal affects over' ment Code, Chapter 531; and Health 

and Safety Code. Chaptb 534 and 1001. 

$419.460. Rehabilitative $ozmnseling and Psychotherapy. 

This agency hereby certifi s that the proposal has been reviewed 

by legal counsel and foun to be within the agency's legal authority to adopt. 

d 

I 

t Filed with the Office of the Secretary of State on April 3, 2006. 

TRD-200601987 I 

Cathy Campbell 

General Counsel 

+ + + 

TITLE 30. ENVIRONMENTAL QUALITY 

PART 1. TEXAS COMMISSION ON 

ENVIRONMENTAL QUALITY 

CHAPTER 114. CONTROL OF AIR 

POLLUTION FROM MOTOR VEHICLES 

SUBCHAPTER K. MOBILE SOURCE 

INCENTNE PROGRAMS 

The Texas Commission on Environmental Quality (commission) 

proposes amendments to §I 14.620 and s114.622. The commission also proposes new ss114.624, 114.640, 114.642, 114.644, 

114.646, and 114.648. 

The new and amended sections are proposed to be submitted 

to the United States Environmental Protection Agency (EPA) as 

revisions to the state implementation plan (SIP). 

BACKGROUND AND SUMMARY OF THE FACTUAL BASIS 

FOR THE PROPOSED RULES 

House Bill (HB) 3469, 79th Legislature, 2005, added Chapter 

390 to the Texas Health and Safety Code. This new chapter directs the commission to establish and administer a clean school 

bus program within the financial limits set by amended s386.051 

and s386.052 (HB 3469, 79th Legislature). This clean school 

bus program will fund efforts by school districts to improve the 

health of children by reducing emissions of diesel exhaust from 

school buses. Reduction of emissions from diesel-powered 

school buses will also benefit the public in ozone nonattainment 

areas by reducing emissions of nitrogen oxides (NO,). 

The commission is proposing new 55114.640, 114.642,114.644, 

114.646, and 114.648 to establish this program. Under these 

proposed sections, school districts, charter schools, and 

regional planning organizations would be eligible for reimbursement grants for the use of emissions reducing catalysts, 

particulate filters, qualifying fuels, and other emissions reducing 

add-on equipment or technology that the commission finds will 

reduce emissions. 

House Bill 2481, 79th Legislature, 2005, added s386.117 to the 

Health and Safety Code to add a rebate grant program under the 

Texas Emissions Reduction Plan (TERP). New $114.624 is proposed to implement this program. The rebate grant will streamline the grant application process for some applicants and will 

ease the administrative burden on program staff. 

Proposed amendments to s114.622 will clarify that for replacement and repower projects, the baseline vehicle, equipment, 

or engine must be scrapped or permanently removed from 

the State of Texas. Proposed amendments to $114.620 and 

$114.622 create an option for the commission to use an equivalent measure to the current $13,000 per ton cost effectiveness 

standard or an alternative approved by the commission. These 

amendments will improve TERP program effectiveness by 

ensuring that high-emitting engines cannot be reintroduced into 

PRC ?POSED RULES April 14,2006 31 TexReg 3187 
an affected county and allowing the commission to increase the 

emissions reductions created by grants. 

SECTION BY SECTION DISCUSSION 

The commission proposes administrative changes throughout 

this rulemaking to be consistent with guidance provided in the 

Texas Legislative Council Drafting Manual, November 2004, and 

to conform with Texas Register requirements and agency guidelines. 

The proposed amendment to $114.620 modifies the definition 

of "Cost-effectiveness" to clarify how the cost-effectiveness of 

TERP grant applications will be determined. The proposed 

amendment to $114.622 clarifies that, for grants entailing replacement or repower of an engine or other equipment, the 

original equipment must be permanently removed from the 

State of Texas. The proposed amendment to $114.622 also 

clarifies that the commission may establish cost-effectiveness 

standards lower than the statutory $13,000 per ton and that the 

commission may also make project selection decisions on a 

variety of factors in addition to cost-effectiveness. 

Proposed new $1 14.624, Rebate Grant Process, establishes a 

process that awards TERP funds as a rebate. This new process 

would provide for ongoing, first-come, first-served awarding of 

standardized rebates for designated project types. It would create a simple, streamlined process to award TERP funds. 

Proposed new $1 14.640, Definitions, provides definitions for the 

Texas Clean School Bus Program. This section provides definitions for important terms in the proposed new division. 

Proposed new $114.642, Applicability, establishes program eligibility for school districts and charter schools. This proposed section also allows regional planning organizations, such as Councils of Government, and private nonprofit organizations to apply 

for and receive grants to improve the program. 

Proposed new $114.644, Clean School Bus Program Requirements, establishes basic program requirements, including: the 

types of projects eligible for a clean school bus grant; the ability of the commission to limit or prioritize funding for the Texas 

Clean School Bus Program; the minimum useful life of a project 

under the grant program; a requirement that replaced equipment 

be permanently removed from the State of Texas; restricting the 

use of grant funds to pay incremental costs associated with the 

project and prohibition against using the grant for administrative 

expenses; prohibition against recipients using grant funding to 

meet federal or state legal requirements and using emissions 

reductions as part of an emissions banking or trading program; 

grant application requirements; and obligation of the grant recipient to return grant funds if they fail to meet the terms of a project 

grant or conditions of the proposed division. 

Proposed new $114.646, Monitoring, Recordkeeping, and Reporting Requirements, establishes that grant recipients must adhere to the reporting requirements of their grant, which will occur 

no less frequently than annually. 

Proposed new $114.648, lmplementation Schedule, establishes 

that the Texas Clean School Bus program will expire on August 

31, 2013. 

FISCAL NOTE: COSTS TO STATE AND LOCAL GOVERNMENT 

Nina Chamness, Analyst, Strategic Planning and Assessment 

Section, has determined that, for the first five-year period the proposed rules are in effect, no fiscal implications are anticipated for 

the agency or other units of state government as a result of administration or enforcement of the proposed rules. The proposed 

rules provide a mechanism to implement the "clean school bus 

program" and amend some provisions of the existing TERP program to provide more program flexibility and clarification of requirements. Fiscal implications are anticipated for regional planning organizations and local independent school districts if, when 

funding becomes available, they elect to participate in a "clean 

school bus program" or apply for a TERP grant. 

House Bills 2481 and 3469, 79th Legislature, amended parts of 

the Texas Health and Safety Code to direct the commission to: 1) 

add a rebate grant program under the Texas Emissions Reduction Plan (TERP); and 2) establish and administer a clean school 

bus program if TERP funds are available after achieving the 

emission reduction objectives of the State Implementation Plan 

(SIP). One part of the proposed rulemaking provides the mechanism to administer and manage a grant and rebate program to 

promote the use of cleaner diesel buses in schools. Under this 

program, independent school districts, charter schools, and regional planning organizations could become recipients of TERP 

funds (Account 5071) in order to reduce emissions of diesel exhaust from school buses. Another part of the proposed rulemaking clarifies requirements for TERP replacement and repower 

projects and amends the manner in which the cost effectiveness 

of projects applying for TERP grant funds will be judged. 

Although the proposed rules establish the needed framework for 

a clean school bus program, two criteria established for making TERP revenue available to fund clean school bus program 

grants are not expected to be met in the current biennium. The 

commission does not anticipate that TERP funds will exceed the 

comptrollers' revenue estimate, nor does the commission anticipate that excess TERP funds will be available after funding 

projects to meet the SIP objectives for air quality. In addition, 

the commission was not granted the needed appropriation authority to fund grants under the clean school bus program during 

the 2006 - 2007 biennium. 

Once the commission is given the needed appropriation authority, and TERP revenues reach the levels required to fund a clean 

school bus program, the estimated 1,255 independent school 

districts and charter schools in Texas could become eligible to re- 

' ceive funds in the form of reimbursement grants to reduce emissions from the estimated 35,142 diesel-powered school buses 

in the state. The proposed rules would also allow regional planning organizations to become grant recipients for the purpose of 

achieving the goals of the clean school bus program in their region. 

Under the clean school bus program, participation is voluntary, 

and grant funds are intended to offset the costs of using school 

buses that emit lower levels of air contaminants. Whether grant 

funding would be sufficient to offset the total cost of complying 

with grant requirements for these school buses depends on the 

amount of funding available, the number and age of qualifying 

buses, and the cost of the methods chosen by grant recipients 

to meet grant requirements. Options to utilize buses with lower 

diesel emissions run from a cost of $0.13 more per gallon of 

emulsified diesel fuel to $10,000 for diesel particulate filters. 

Currently, local governments can apply for funds under the 

existing TERP grant program to reduce vehicle emissions in 

the 41 counties covered by the TERP program. The proposed 

rulemaking, by making the criteria for judging cost effectiveness 

more flexible, may allow projects, not currently funded by TERP 

grants, to receive funding. Given the wide universe of applicants 

31 TexReg 3188 April 14, 2006 Texas Register 
and types of projects that could be funded by TERP grants, the 

fiscal implications to local governments are not known at this 

time. 

PUBLIC BENEFITS AND COSTS 

Ms. Chamness also determined that for each year of the first 

five years the proposed rules are in effect, the public benefd anticipated from the changes seen in the proposed rules will be the 

establishment of a program, which when funded, will promote 

lower emissions of air contaminants. 

If funding to implement the "clean school bus program" becomes 

available, school districts or charter schools transporting school 

children could become recipients of monies which could lower 

their costs of using buses that have lower diesel emissions. The 

proposed rulemaking provides a variety of acceptable options to 

lower diesel emissions from school buses. These options range 

from a cost of $0.1 3 more per gallon of emulsified diesel fuel to 

$10,000 for diesel particulate filters. 

Due to increased flexibility in judging cost effectiveness, busi-. 

nesses applying for TERP grants may see projects not previously funded receive TERP funding. 

SMALL BUSINESS AND MICRO-BUSINESS ASSESSMENT 

No adverse fiscal implications are anticipated for small or micro-businesses that serve as third party contractors to transport 

school children. If funding to implement the program becomes 

available, small or micro-businesses may qualify to receive grant 

funding to offset the costs associated with complying with the 

program's requirements. Increased flexibility in judging the cost 

effectiveness of a TERP grant project may increase the amount 

of TERP funding received by small or micro-businesses. 

LOCAL EMPLOYMENT IMPACT STATEMENT 

The commission has reviewed this proposed rulemaking and determined that a local employment impact statement is not required because the proposed rules do not adversely affect a local economy in a material way for the first five years that the 

proposed rules are in effect. 

DRAFT REGULATORY IMPACT ANALYSIS DETERMINAl-ION 

The commission reviewed the proposed rulemaking in light of the 

regulatory analysis requirements of Texas Government Code, 

52001.0225, and determined that this proposal is not subject to 

§2001.0025 because it does not meet the definition of a "major 

environmental rule" as defined in that statute. A "major environmental rule" means a rule the specific intent of which is to protect 

the environment or reduce risks to human health from environmental exposure and that may adversely affect in a material way 

the economy, productivity, competition, jobs, the environment, or 

the public health and safety of the state or a sector of the state. 

The proposed amendments to Chapter 114 modify the existing rules in accordance with House Bill 3469, 79th Legislature, 

which amended Texas Health and Safety Code, 5386.051 (b) and 

added Texas Health and Safety Code, Chapter 390 to require 

the commission to establish a clean School-BUS Program. The 

Clean School Bus Program is intended to reduce diesel exhaust 

emissions from school buses by funding eligible projects. These 

rule amendments are part of a voluntary incentive program with 

the goal of reducing diesel emissions and as such, the proposed 

rules will not adversely affect in a material way the economy, a 

sector of the economy, productivity, competition, jobs, the environment, or the public health and safety of the state or a sector 

of the state. 

Further, the proposed amendments to Chapter 114 modify 

the existing rules in accordance with House Bill 2481, 79th 

Legislature, which amended Chapter 386, Subchapter C of the 

Texas Health and Safety Code by adding 5386.117, directing 

the commission to adopt a process to award grants in the form 

of rebatesto streamline the grant application, contracting, reimbursement, and reporting processes for certain projects under 

the TERP. These rules amendments will implement procedural 

changes and will have no effect on the environment or human 

health. These rule amendments are part of a voluntary incentive 

program with the goal of reducing diesel emissions and as such, 

the proposed rules will not adversely affect in a material way the 

economy, a sector of the economy, productivity, competition, 

jobs, the environment, or the public health and safety of the 

state or a sector of the state. 

In addition, a draft regulatory impact analysis is not required because the rules do not meet anv of the four a~~licabilitv criteria 

for requiring a regulatory analysis of a "major environmental rule" 

as defined in the Texas Government Code. Section 2001.0225 

applies only to a major environmental rule the result of which 

is to: 1) exceed a standard set by federal law, unless the rule 

is specifically required by state law; 2) exceed an express requirement of state law, unless the rule is specifically required 

by federal law; 3) exceed a requirement of a delegation agreement or contract between the state and an agency or representative of the federal government to implement a state and federal program; or 4) adopt a rule solely under the general powers 

of the agency instead of under a specific state law. This rulemaking does not exceed a standard set by federal law, and the 

proposed technical requirements are consistent with applicable 

federal standards. In addition, this proposal does not exceed 

an express requirement of state law and is not proposed solely 

under the general powers of the agency, but is specifically authorized by the provisions cited in the STATUTORY AUTHORITY section of this preamble. Finally, this rulemaking does not 

exceed a requirement of a delegation agreement or contract to 

implement a state and federal program. 

The commission invites public comment on the draft regulatory 

impact analysis determination. 

TAKINGS IMPACT ASSESSMENT 

The commission evaluated this rulemaking action and performed 

an analysis of whether the proposed rules are subject to Texas 

Government Code, Chapter 2007. The primary purpose of the 

rulemaking is to amend Chapter 114 in accordance with House 

Bill 3469 and House Bill 2481. These amendments im~lement a

voluntary program and only affect motor vehicles and equipment 

which are not considered to be private real propertv. Therefore. .. - promulgation and enforcement of these proposed rules are neither a statutory nor a constitutional taking because they do not 

affect private real property. Therefore, these rules do not constitute a taking under Texas Government Code, Chapter 2007. 

CONSISTENCY WITH THE COASTAL MANAGEMENT PROGRAM 

The commission reviewed the proposed rulemaking and found 

that the proposal is subject to the Texas Coastal Management 

Program (CMP) in accordance with the Coastal Coordination 

Act, Texas Natural Resources Code, §§33.201 et seq., and 

therefore must be consistent with all applicable CMP goals 

and policies. The commission conducted a consistency determination for the proposed rules in accordance with Coastal 

Coordination Act Implementation Rules, 31 TAC 5505.22, and 

PROPOSED RULES April 14,2006 31 TexReg 31 89 
found the proposed rulemaking is consistent with the applicable 

CMP goals and policies. 

The applicable goal of the CMP is to protect, preserve, restorei 

and enhance the diversity, quality, quantity, functions, and values of coastal natural resource areas. The specific CMP policy 

applicable to these rules is that commission rules comply with 40 

Code of Federal Regulations (CFR), to protect and enhance air 

quality in coastal natural resource areas (31 TAC 5501.32). The 

commission reviewed this proposed rulemaking for consistency 

with the Texas CMP goals and policies in accordance with the 

regulations of the Coastal Coordination Council and determined 

that the amendments are consistent with CMP goals and policies because this proposed rulemaking action would reduce air 

pollution from diesel-powered school buses. No new sources of 

air contaminants are authorized and nitrogen oxides and particulate air emissions would be reduced as a result of these rules. 

This proposed rulemaking complies with 40 CFR Part 51. This 

proposed action is part of the control strategy for ozone nonattainment areas in accordance with SIP requirements in 40 CFR 

Part 51 and reduces emissions of particulate matter consistent 

with National Ambient Air Quality Standards set for particulate 

matter in 40 CFR Part 50. 

Promulgation and enforcement of these rules will not violate or 

exceed any standards identified in the applicable CMP goals and 

policies because the proposed rules are consistent with these 

CMP goals and policies, because these rules do not create or 

have a direct or significant adverse effect on any coastal natural resource areas, and because the proposed rules will reduce 

emissions of air pollutants. 

Written comments on the consistency of this rulemaking may be 

submitted to the contact person at the address listed under the 

SUBMITTAL OF COMMENTS section of this preamble. 

ANNOUNCEMENT OF HEARING 

A public hearing on this proposal will be held in Austin on May 9, 

2006, at 2:00 p.m. at the Texas Commission on Environmental 

Quality Complex located at 12100 Park 35 Circle in Building F, 

Room 2210. The hearing will be structured for the receipt of 

oral or written comments by interested persons. Individuals may 

present oral statements when called upon in order of registration. 

There will be no open discussion during the hearing; however, 

an agency staff member will be available to discuss the proposal 

30 minutes prior to the hearing and will answer questions before 

and after the hearing. 

Persons who have special communication or other accommodation needs who are planning to attend the hearing should contact 

Holly Vierk at (512) 239-0177. Requests should be made as far 

in advance as possible. 

SUBMITTAL OF COMMENTS 

Comments may be submitted to Holly Vierk, MC 205, Office of Legal Services, Texas Commission on Environmental Quality, P.O. Box 13087, Austin, Texas 78711-3087, 

or faxed to (512) 239-4808. All comments should reference Rule Project Number 2006-016-114-EN. The proposed rules may be viewed on the commission's Web site 

at hffp://www.tceq.state.tx.us/nav/ruledpropose~adopt.html. 

Comments must be received by 5:00 p.m., May 16, 2006. 

For further information please contact Erik Gribbin, Air Quality 

Planning and Implementation Division, (512) 239-2590. 

DIVISION 3. DIESEL EMISSIONS 

REDUCTION INCENTIVE PROGRAM 

FOR ON-ROAD AND NON-ROAD VEHICLES 

30 TAC 55114.620, 114.622, 114.624 

STATUTORY AUTHORITY 

The amendments and new section are proposed under Texas 

Water Code, 55.102, which provides the commission with the 

general powers to carry out its duties under the Texas Water 

Code; 55.103, which authorizes the commission to adopt any 

rules necessaryto carry out the powers and duties under the provisions of theTexas Water Code and other laws of this state; and 

55.105, which authorizes the commission by rule to establish 

and approve all general policy of the commission. The amendments and new section are also proposed under Texas Health 

and Safety Code, Texas Clean Air Act, 5382.017, which authorizes the commission to adopt rules consistent with the policy 

and purposes of the Texas Clean Air Act; 5382.01 1, which authorizes the commission to establish the level of quality to be maintained in the state's air and to control the quality of the state's air; 

5382.012, which authorizes the commission to prepare and develop a general, comprehensive plan for the control of the state's 

air; and Chapter 386, which establishes the TERP. Finally, the 

amendments and new section are proposed as part of the implementation of House Bill 2481, 79th Legislature, 2005. 

The proposed amendments and new section implement Texas 

Clean Air Act, 55382.002, 382.011, 382.012, 382.017, 386.051, 

and House Bill 2481, 79th Legislature, 2005. 

.f114.620. Definitions. 

Unless specifically defined in the Texas Clean Air Act (TCAA) or in 

the rules of the commission, the terms used in this subchapter have 

the meanings commonly ascribed to them in the field of air pollution 

control. In addition to the terms which are defined by the TCAA; and 

583.2, 101.1, and 114.1 ofthis title(re1ating to Definitions), the following words and terms, when used in this division shall have the following 

meanings, unless the context clearly indicates otherwise. 

(I) Cost-effectiveness--The total dollar amount expended 

divided by the total number oftons of nitrogen oxides emissions reduction attributable to that expenditure. In calculating cost-effectiveness, 

onetime grants of money at the beginning of a proiect shall be annualized using a time value of public finds or discount rate determined for 

each project by the commission,!aking into account the interest rate on 

bonds, interest earned by state funds, and other factors the commissa 

considers appropriate. 

(2) - (7) (No change.) 

(8) Qualifying fuel--Any liquid or gaseous fie1 or additives registered or verified by the United States Environmental Protec- 

- tion Agency [EM] that is ultimately dispensed into a motor vehicle or 

on-road or non-mad diesel that provides reductions of nitrogen oxides 

emissions beyond reductions required by state or federal law. 

(9) (No change.) 

(10) Retroiit--To equip an engine and fuel system with new emissions-reducing parts or technology verified by the United States 

Environmental Protection Agenc~ [EM] after manufacture of the original engine and fuel system. 

(1 1) .(No change.) 

f114.622. Incentive Ptvgrcim Reyuiremenh. 

(a) - (b) (No cha~~ge.) 

31 TexReg 3190 April 14, 2006 Texas Register 
(c) For a proposed project that includes a replacement of 

equipment or a repower, the old equipment or engine must be recycled, scrapped, or otherwise permanently removed from the State 

of Texas. [terneveti #kern aH eetfriks Wd in +l-l4629 of this We 

frebtmg b ~~ Gemt4es and kRpleme~&en S&etiule+] 

(d) To be eligible for a grant, the cost-effectiveness of a proposed project as listed in subsection (a) of this section, except for infrastructure projects and infrastructure purchases that are part of a broader 

retrofit, repower, replacement, or add-on equipment project, must not 

exceed a cost-effectiveness of $13,000 per ton of NO, emissions reduced. The commission may set lower cost-effectivhess limits as 

needed to ensure the best use of available funds. The commission may 

also base project selection decisions on additional measures to evaluate 

the effectiveness of projects in reducing NO, emissions in relation to 

the funds to be awarded. [$-eQ00 pef ten eM, entissiens] ' 

(e) - (i) (No change.) 

AY114. 624. Rebate Grant Process. 

@J This section establishes a process to provide fast and simple access to rebate grants, in accordance with Texas Health and Safety 

Code, $386.1 17. 

@J The rebate grant process shall: 

II) designate certain types of projects eligible for rebates; 

Q project standardized oxides of nitrogen emissions re- ductions for each designated project type; 

rn assign a standardized rebate amount for each designated proiect type; 

(4J allow for processing rebates on an ongoing first-come, 

first-served basis; and 

@ consolidate, simplify, and reduce the administrative 

work for applicants and the commission associated with grant application, contracting, reimbursement, and reporting processes for 

designated project types. 

@J The commission may: 

II) award rebate grants as a pilot project for a specific re- gion or may award the grants statewide; 

a limit or expand the designated project types as neces- sary to further the goals of the program; and 

122 administer the rebate grants or may designate another 

entity to administer the grants. 

This agency hereby certifies that the proposal has been reviewed 

by legal counsel and found to be within the agency's legal authority to adopt. 

Filed with the Office of the Secretary of State on March 31,2006. 

TRD-200601933 

Stephanie Bergeron Perdue 

Acting Deputy Director, Office of Legal Services , 

Texas Commission on Environmental Quality 

Earliest possible date of adoption: May 14. 2006 

For further information. please call: (512) 239-0177 

DIVISION 4. TEXAS CLEAN SCHOOL BUS 

PROGRAM 

30 TAC @114.640, 114.642,114.644, 114.646,114.648 

STATUTORY AUTHORITY 

The new sections are proposed under Texas Water Code, 

55.1 02, which provides the commission with the general powers 

to carry out its duties under the Texas Water Code; 55.103, 

which authorizes the commission to adopt any rules necessary 

to carry out the powers and duties under the provisions of the 

Texas Water Code and other laws of this state; and 55.105, 

which authorizes the commission by rule to establish and ap 

prove all general policy of the commission. The new sections 

are also proposed under Texas Health and Safety Code, Texas 

Clean Air Act, 5382.017, which authorizes the commission to 

adopt rules consistent with the policy and purposes of the Texas 

Clean Air Act; 5382.011, which authorizes the commission to 

establish the level of quality to be maintained in the state's air 

and to control the quality of the state's air; 5382.012, which 

authorizes the commission to prepare and develop a general, 

comprehensive plan for the control of the state's air; Chapter 

386, which establishes the TERP; and Chapter 390, which 

establishes the Clean School Bus Program. Finally, the new 

sections are proposed as part of the implementation of House 

Bill 3469, 79th Legislature, 2005. 

The new sections implement Texas Clean Air Act, 55382.002, 

382.011, 382.012, 382.017, 386.051, and House Bill 3469, 79th 

Legislature, 2005. 

$114.640. Definitions. 

Unless specifically defined in the Texas Clean Air Act (TCAA) or in 

the rules of the commission, the terms used in this subchapter have 

the meanings commonly ascribed to them in the field of air pollution 

control. In addition to the terms which are defined by the TCAA and 

3§3.2,101.1, and 114.1 of this title (relating to Definitions), the following words and terms, when used in this division shall have the following 

meanings, unless the context clearly indicates otherwise. 

II) Diesel exhaust--One or more of the air pollutants emitted from an engine by the combustion of diesel fuel, including particulate matter, nitrogen oxides, volatile organic compounds, air toxics, 

and carbon monoxide. 

Incremental cost--The cost of an applicant's project less 

a baseline cost that would otherwise be incurred by an applicant in the 

normal course of business. Incremental costs may include added lease 

or fuel costs as well as additional capital costs. 

fi Qualifying fuel--Includes any liquid or gaseous fuel or additive registered or verified by the United States Environmental Protection Agency, other than standard gasoline or diesel, that is ultimately 

dispensed into a school bus that provides reductions of emissions of 

particulate matter. 

(4J Repower--To replace an oldine powering an 

on-road or non-road diesel with a new engine; a used engine; a 

remanufactured engine; or electric motors, drives, or fuel cells. 

@ Retrolit--To equip an engine and fuel system with new 

emissions-reducing parts or technology verified by the United States 

Environmental Protection Agency after manufacture of the original engine and fuel system. 

$114.642. Agplicabilig 

(aJ Any school district orcharter school in this state that oper- 

- ates one or more diesel-fueled school buses or a transportation systeln 

provided by a countywide school district maydy for and receive a 

g;rant under the program. 

PROPOSED RULES April 14,2006 31 TexReg 3191 
(bJ The commission may allow a regional planning commission, council of governments, or similar regional planning agency created under Local Government Code, Chapter 39 1, or a private nonprofit 

organization to apply for and receive a grant to improve the ability of 

the program to achieve its goals. 

,f114.644. Clean School Bus Progranr Requirements. 

{aJ Eligible proiects include: 

(IJ diesel oxidation catalysts for school buses builtbefore 

1994; 

(2J diesel particulate filters for school buses buill from 

1994 to 1998; 

(3J Ihe purchase and use of emission-reducing add-on 

equipment for school buses, including devices that reduce crankcase 

emissions; 

the use of qualifying fuel; and 

other technologies that the commission finds will bring 

about significant emissions reductions. 

(bJ commission may limit fiinding under a particular 

funding round to certain areas of the state, types of applicants, and/or 

of projects. The commission may place a priority on fundingfor 

proiects conducted in areas that do not attain certain national ambient 

- air quality standards, 

@ Prior to each fundinaod, the commission may establish 

priorities and omiteria for reductioan diesel exhaust emissions 

tobe achieved by proiects funded during that period, including designation of additional pollutants to be addressed. A proposed project 

must achieve a reduction in emissions of diesel exhaust compared with 

the baseline emissions according to the percentage reduction level and 

other priorities established by the commission. The commission may 

also establish maximum levels for the funding awarded in relation to 

&emission reductions proiected to be achieved by a project, in order 

to maximize the use of available funds. 

@J A school bus proposed for retrofit must be used on a regular, daily route to and from a school and have at least five years of useful 

life remaining unless the applicant agrees to remove the retrofit device 

at the end of the life of the bus and reinstall the device on another bus. 

[eJ For a proposed project thatincludes a replacement of 

equipment or a repower, the old equipment or engine must be recycled, 

scrapped, removed from the State of Texas. 

@ An application for a grant under this program is only eligible if it is made on the form provided by the comlnission and contains - - 

- the information required bytl,ecommission. 

Apiei>t of a grant under this division shall use the grant 

to pay incremental costs of the project for which the grant is made, 

which may include the reasonable and necessary expenses jncurred for 

the labor needed to install emissions-reducing equipment. The recipient may notuse the grant to pay the recipient's administrative expenses. 

(hJ Pmiects finded with a grant from this psram maynot 

be used for credit under any state or federal emissions reduction credit 

averaging, banking, or tradina program except-asprovided under Texas 

Health and Safety Code, 1386.056. 

(9 . &proposed project as listed in subsection (a) of this section 

is not eltgtble if it is required by any state or federal law, rule or regulation, memorandum of agreement, or other legally binding document. 

- This subsection does not apply to an otherwise qualified project, regardless of the fact that the state implementation plan assumes that the 

change in equipment, vehicles, xoperations-will-occur, if on the date 

the grant is awarded the change knot required by any state or federal 

law, rule or regulation, memorandum of agreement, or other legally 

binding document or the purchase of an on-road diesel or equipment 

required only by local law or regulation or by corporate or controlling 

board policy of a public or private entity. 

0 If a grant recipient fails to meet the terms of a project grant 

or the conditions of this division, the executive director can require that 

the grant recipient return some or all of the grant funding to the extent 

that emission reductions are not achieved or cannot be demonstrated. 

~7114.646. monitor in^. Recordkeeping, and Reporting Requirrments. 

Grant recipients must meet the reporting requirements of their grant, 

which must occur no less frequently than annually. 

,6114.648. Implementation Schedule. 

This division expires August 31, 2013. 

This agency hereby certifies that the proposal has been reviewed 

by legal counsel and found to be within the agency's legal authority to adopt. 

Filed with the Office of the Secretary of State on March 31,2006. 

TRD-200601934 

Stephanie Bergeron Perdue 

Acting Deputy Director, Office of Legal Sewices 

Texas Commission on Environmental Quality 

Earliest possible date of adoption: May 14, 2006 

For further information, please call: (512) 239-0177 

CHAPTER 29 1. UTILITY REGULATIONS 

The Texas Commission o Environmental Quality (commission) 

proposes amendments t $9291.8, 291.15, 291.21, 291.22, 

291.24, 291.26, 291.28, 91.29, 291.31, 291.34, and 291.81. 

The commission also pro oses to add new 5291.35. 

BACKGROUND AND S MMARY OF THE FACTUAL BASIS 

FOR THE PROPOSED 1 ULES 

oceeding in which the agency has 

September 1, 2001. Additionally, 

.145, Multiple Systems Consolinew subsection (b) which states, 

a public utility that provided utility 

31 TexReg 31 92 April 14, 2006 Texas Register 
Kathleen Hartnett White, Chairman 

R. B. "Ralph" Marquez, Commissio?7er 

Larry R. Soward, Commissioner 

Glenn Shanltle, Executive Director 

Protecting Texas by Reducing and Preventing Pollution 

NOTICE OF PUBLIC HEARING BY THE 

TEXAS COMMISSION ON ENVIRONMENTAL QUALITY 

ON PROPOSED REVISIONS TO 

30 TAC CHAPTER 114 AND TO THE STATE IMPLEMENTATION PLAN 

The Texas Commission on Environmental Quality will conduct a public hearing to receive testimony 

concerning revisions to 30 TAC Chapter 114, Control of Air Pollution from Motor Vehicles, under the 

requirements of Texas Health and Safety Code, 8382.017; Texas Government Code, Chapter 2001, 

Subchapter B; and 40 Code of Federal Regulations 551.102, of the United States Environmental Protection 

Agency (EPA) regulations concerning state implementation plans (SIPS). 

The proposed rulemaking would implement House Bill 3469 and House Bill 248 1, 79th Legislature, 

2005. The proposed rulemaking would establish rules for the Texas .Clean School Bus Program as 

directed by House Bill 3469. The proposed rulemaking would also clarify cost effectiveness 

requirements for the Texas Emissions Reduction Plan, establish a rebate grant program as part of the 

Texas Emissions Reduction Plan, and provide for clarification of scrappage requirements for repower 

and replacement projects under the Texas Emissions Reduction Plan grant program as provided in 

House Bill 248 1. 

A public hearing on this proposal will be held in Austin on May 9, 2006, at 2:00 p.m. at the Texas 

Commission on Environmental Quality in Building F, Room 2210, located at 12100 Park 35 Circle. 

The hearing will be structured for the receipt of oral or written coinments by interested persons. 

Individuals may present oral statements when called upon in order of registration. There will be no 

open discussion during the hearing; however, an agency staff member will be available to discuss the 

proposal 30 minutes prior to the hearing. 

Persons who have special communication or other accommodation needs who are planning to attend the 

hearing should contact Holly Vierk, Office of Legal Services, at (512) 239-0177. Requests should be 

inade as far in advance as possible. 

Comments may be submitted to Holly Vierk, MC 205, Texas Register Team, Office of Legal Services, 

Texas Coininission on Environinental Quality, P. 0. Box 13087, Austin, Texas 7871 1-3087 or faxed 

to (512) 239-4808. All comments should reference Rule Project Nuinber 2006-016-114-EN. 

Comments inust be received by 5.00 p.m., May 16, 2006. Copies of the proposed rules can be 

obtained from the coininission's Web site at htp://www. tceg. state. tx. us/lzav/rules/propose adopt. html. 

For further information, please contact Erik Gribbin, Air Quality Planning and ~in~lement~ion 

Division, at (512) 239-2590. 

Issued in Austin, Texas, on Marclz 29, 2006. 

P.0. Box 13087 Austin, Texas 78711-3087 512/23(-I-1.000 Internet acldress: www.tceq.state.tx.~~s 

lli.lll. I,', I,, I ..i!ll,l,'r, illill. ,ii. !,.,.I<! ,ill 
WRITTEN AND 

ORAL TESTIMONY 
Reference Number 

W-I 

INDEX OF WRITEN TESTIMONY 

Submitted by 

Ramon Alvarez, Ph.D. and Betin Santos, Enironmental 

Defense 

Bruce A. May, on behalf of himself 

Brandt Mannchen, Sierra Club, Houston Regional Group 

Cyrus Reed, Texas Center for Policy Studies 

Thomas H. Diggs, United States Enironmental Protection 

Agency 
MAY-1 6-2006 TUE 02 : 12 PM FAX NO, 

I'<E: 1:nle l'rojcct Number 2006-01G-114-EN 

, . .,'* I',r~virc~~~t.r~~r~tal 1)cfense apprcciatcs the oppor~~~nity to provide commcnts on 1 CkQs 

propc~s~:~I ndcs to irn~.~lcrr,ont I-3B3169, 79" l'cxas Lcgislaturc. 

Whilc wc a.re disnprointcd that thc Lcgislahnre did not appropriatc funds fox this 

i1nport:lnt program, wc arc optimistic that ii~~lding will be niadc available during the next 

s~ssiori. Coriscrlua~ltly, it is crucial to 21avo thc b:~sic rulcs in 1)lac.c so dlat thc 'IiCEC~c:tn 

proceed cxpcditiously to 11l~1ic p;r'i~lis whcrx rhc filnding bcc.orr~cs avfiilab2c. 

.In gcncral, wrr: support thc 'TCEqs proposed n~lcs to establish thc Tcxas Clean School 

1311s 13rogr.01n. T-Jowzvcr, the Co~nrnissiotl slrould rcfir~c die l>ro]>oscd rvlcs to bctlcr 

rcllcct 1.11~ Icgislativcly-statcd goal of impl-oving thc "rnicro-cnvironmti~t" in and around 

school luscs. 

1 I 113409 clearly st~tes tl~st thc purpose of the clean school bus program is "to reducc the 

cxposllrc of school childrcn to dicsel wliaust ill and aj;oy~d dicscl-fueled scllool huscs" 

(Scctiur~ 33i).002, emphasis adtlcct). Nunlcrol~s studics sllow that in-cabill lcvcls of I'M 

2.5 ar~tl olllcr dic;scl ~.clateil ~>ollu iants cnrl L)c cl~~va~ccl re1;liivc ro n.irll:>icnt: lcvcls (scc 

a l r:~chcd sl.lmn-lnly of srudics). 

Wc !;lipport prol~nsed Scctions 114.640 and 114.G42. Wc ~rould notc that ccrtnin school 

cli:;tric'~s in tli(: s~;\tc c.orltr;lc:t out sornc or i111 ofthcir transportatio~~ scrviccs, and thc 

;);;cl.~h:y sl.tot~l~.l 11111s considcr w;rys to cnsurc buscs olser-arcd by third patties can parricipfl~c 

in t:11 is 1i~:o?,l-:t ITL. 
MAY-1 6-2006 TUE 02 : 13 PM FAX NO, 

I'ro~~x<::~l scc~ion 114.644(a)(2) outlines ~1,igiLility csfdicsel partic~datc filters (DPl's) i1t-111 

Ii~r~itr; rl~c usc of filttrs to sdlc:,ol buses made bctwccn 1091 2ind 1.998. 'l'he enginc 

s~:tntliirrI!i Tor: I'M emissions arc thc siline for rnodcl ycnrs 1994-2006 and DI'Fs havc 

k~ccrl vi:ri ficd for tbcsc modcl ycars. Sce t': t3,A a.nd CJARl3 wcbsitcs ror currcnr list 

(\V.BX!.C~L!.+J)V/~ t+q[r~~~~fit[r~~r~.y~-r~.fi~:ciljst.l~ t~n ) and 

~!~~~:~t~-~~.c:n.{;~~/(~~.c~~_r!vcr(~ ~v/~~!~c.~~~~;r!~crifiedt:ec11.~itri~ . AS t hc progriim ~volvcs into 

1,I;li: fiit.i~rc, thc cornrnissiun shoilld look to cxpand thc ra~~gc of madcl yea.rs covered by 

~JIC p,l:cJl:r;i t 71 to I n:l~c.l,r thosc for wl.~ich thcrc &rc vcri'ficd tcrJi t~ologics. 

L"rnpo:;cd sccti or) I 1.4.644 (h) is inconsistent with thc statutory language aild should bc 

rcrnovcrl, Ir.1 particular, thc ComrlJssio~l shor~ld 11a limit funding to ccrtairl arc:is of ~hc 

S~R~C. A.s ~iiltcii ;ltovc, tllc ~)ropiln,'~ purpose is to rcducc rxposurcs i~find arnrlnd school 

buscs ;~rltl tllt~~c is 110 rc8son ro treat a bus in Midland any differcudy tlnn a bus in 

1 Ious~on, 

r \ 1I.r~ Cornmission should d;~rifyin. yrol~oscd section 114.644(c) what il: ~ncar~s by r* "ndcli ~ior~:.~l ~~t.~Ilutanls LO I;lt: ntldscsscrl" clurinm n finding pcdod. 1 lli s language appcnrs P 

SI~~~:~J~/I('JIIS in lip,llt of the spccific tcchnolog~cs cnurncmted in Section 114.644 (a). 

Wc 11 rgc ihc Col~lrnission to lcccp 111c prngram simplc for school clisr~.icrs by ~sprcssly 

~.\rgsCns rlrc vents to n slrldl nurnbm of proven tccl~nclogics like thosc in Scction 

I 14.811(~), whicll hwc al~arly llccu vcrificd by EPA. Admini~t~~tivc case will bc 

important to nttrilct pi11 tjtril~;~ [ion ,from tlzc sn~dcr school districts in the stxte. 

In clo:,irq<, IVC 1001~ fo~ward cn woi-king with thc TCEQslaffitl jmplcnlenbng tl~c Tcxirs 

CllL:;ir~ SctlooI 11~:; l.'r.i~g~am. We would cspccially urge 111c Commission to build inlo ils 

I,r:gisI:i~ivc Appropriation Rcclacst arl~~llc ruuding for this program. 

l'lcas~: contncr Ilctin Santus at 713/94.2-5821 if you 11nve ally questions. 

-. 'i., ,Y - (. . /3 yL >~~~~TJ~~~ .S,, - .... f... 

l'\t;rii~ Sa.t~(.os 

lMnl~:~gcr, I-1,ouston C11:;ln Air fht 'l',jfc Campaign 
MAY-1 6-2006 TUE 02 : 13 PM FAX NO, 

€?NVIRONMeNf'AL DeFeNSe 

finding tlro ways lhht work 

'!Zit)] ISSTONS ~~xOM SC:F~OO~, R~JSES INcPE.A.SE POLI~UTZON LEVELS INSI'DIZ ?lIE BUS 

T'lre 'Ilu! t c~l'Sri~ntiGc Si isdics Sug~est that SL-If-:-ll'ollution is Real 

I.'\~.;cc:r.lt :;tu&e:; shw that. air pollrl~nt lcvcls inside school brrscs can bc greater tljan the ambio~t levels 

ciulsiciz .llrc: l)\lv. 'l'hc cl~vxtcd levels arc ;\t~rik~utcJ to crnissions frotr.1 rhc bus itsclftl~at inmldc into thc 

bus c:rbin, a process soll~ctirncs cnllcd usclf-pollui~on.* Factors that affect the mount of these cmissiotls 

entwitrg rllc tus kiclurlc wind spccd dnd dircction, wlletlxr windows are opened or closed, agc and 

cor~djtion of tlic bus. A smdzr numhcr ofstr~dics question wl~edler school bus self-pollutjon ;rciually 

occurs to atly significi~nt cxtcnt, typically a~~tihi~tirlg pollution inside a school bus to other vcl~iclcs on the 

roac.1. Tlle cxistii.rg cvidrncc is surnmasijr~d in the attached rcview. 

On l:,,llnrrcc, rlit:.rc is strong evirlctlcc th;st school bus self-pollution is a rcal phcnomenol~. IGvc 

inclcpc.ndcnt t cscarcl~ t~t:lrns using different. n~ct.l.iods havc documented tljc drcct Ivr nlaily buscs in 

Ilrir.rtr.troor; locaticns. I3y comp~-ir;on, thc studics with negaiive resl~lts cxanlined fewer comyoncnts of tile 

er1;;inc's cmis~;ions at13 cunscquently failed to fully characterize the problcrn. 

# ', I l~isc ;ITC ~IVO PourceEi of crnissiorks that crrntritute to the self-pollution effect: the cnbrjnc c;r~nkcase and r 1 1 til 1.11~ cr:i~zkcasc on I-IIOS~. djcscl cngncs is vented to the air, which results in emissions of 

volntilisscd crlginc oil, as wtJl3~ unburncd fuel and cxhaust gases that lealr through or "blow-by" the yis~on P, rings. I Ilc rclx~ivc strengths of thc' crankcase and tllc tailpip nrc not well estd~lishccl; howcver, 

I>onnld::osi cstir~t;trcs hat the crankcase accout~ts for 10-25% of an engine's total partim1;lte crrzissions.' 

'.l'h~: C1c:ln Air Task l:orcc's rrltasatemcnts of in-cabin pollution lcvcls show that, obscm:d ultrafine 

p:~t iic:lc:: (<IJIFII), black ra~~l>on and PAH originarc from dic tailpipe while thc majority of the ~bser~~d 

I!iL3'%.T ~rznss corncs fion.~ the crnnkcasc. 

C:ornrric.rcially avnilalilc tccll~iolo~rzs can cffccrively rcnlovc ncarly all of the cnjissions that contribute to 

c:l~~:~t~:i~I 17r,ll\1t ion lcvcls iasit-le scl\onl l~uscs. Crankcase fil~ration systems, whid~ itap oil mists and 

ri.:~c,)~~to crnnl~:c:ir;e ernissinr~s back to the engine air intake, can reduce pa.rticulatc cmissio~ls by rnorc than 

9046. I2.icst.:l1~:i rt-iculatc filters (1,IbF) l~nvc bccn verified by )(:PA to reduce tailpipcpadculatc cmissioi~s 

by 9.594 or. rncm tvhilc dicscl oxids.tjon catalysts (DOC) cm, aclrjevc reductions in tllc 25% rnrelgc. 

'l'l~vst: tlcvir.:r:s c:~n also dr~rn:\cic;~l.iy improve air quality inside school buscs a.nd outsidc of schools. The 

C.l.cnn A.il.'.l';~slc :I:urc:t: fo~ind tlmt P cra~lkcasc liltcr and a 13P'I{ usecl irl tandcm, can rcducc a11 111c kCy 

dic.s:.l plli.[tai~t I~::vi:,ls' i KIS~L~C ~~11001 buses down ro arlzbicnt levels. 
FAX NO, 

a I.lill, L1.13., %Ii~ulmc.rman, N.J., and Cooch, J., "A Multi-City Invcstigntio~~ of rhc Fflcc~ivcncss oF 

I<utrtsfit I:l:snissioas Corlirols in licducjng 1.3xl>osurcs to I'arficulatc Matter in School Bu.ses," 2005; 

:iv,~ i lal>lc :it y~y~~.~;irf,~~s/~~~jJ~]j.~fi t ioi3s/vicw/82. 

J ~~vcsti:;ates tllc cn~lscs of scl~ool hrrs sclf-polluri on and doculncnts tllc reductions in palticulate mattcr 

~~ollution i~isidc! sckiool bus cabins wtrofit with various emission control dcviccs. Idcntifics thc txilpipc as 

t1~ source oft11 1.filfi11~ l>i\r.[jclc~, bl~cl; carbon, and particle-bound I'AH in L~C buscabin, and crarrkc;lsc 

snaissions 38 the ddos11i~13rit source of in-cal3in levcls of PM2.5, A diesel particulate filtcr effcctivcly 

1'crIlavizs ilr:: ullrt~firlc particles, black c.arlon ant1 PAH, wllilc ;L doscd-~cranlccase filtra.tior~ device 

effi.:ctivr:ly rc;.r.onvec-l'h42.5, WJ- en cornbiiled, the iw contl.01 devices newly elillinate all measured 

par-ciclc specie:;. 

(E h/(a.r:ij.~ll, J.1:). and I~C~~CIII-Z, l?., uVcl~iclr, Self-Pollution Intakc Fraction: Childrcn's Expoourc to 

Sclzool 13us IS~nissinns,'' E~lvironrnontal Scicncc and Tcchnolagy, 2005, p. 2559 

17si11g rl3t::i fii-orc~ Pitx ct nL, tIGs papcr finds that the fi-action of pollution insidc a sd~ool bus attributable 

to tl~c brls itxclf'is "subatantid." Concludes that seducing c~nissions from school buscs, cvcn ifdoi11g SO 

r\e.w 111111.11 1110~~ CX~CI~S~VC pet giarn orritid rhnn for eon ivcngc vchide, "it would still be less evpensivc per 

EYIAIII it:frir:t?w', (r~,l~13i.~ll is a bct~.cr pro:xy [or hc:llcll crccrs. Calls hr rcseatch to identify the n-rcdlanisn of .I 

scll-rmllu tion. 

uf Ontnrio Pulalic 1lc.alth Association, 'Scliool nuses, Air Pollution E;c Children's Hcalth: 

1111l)rovi nj; Clildrtn's IJcdth and Local fir by Rcclucing School Bus Emissions," 2005; 

a u;ii 1 ~1?1,:: 2.t. J~J.?!W&:~)~~~,_O_~_~~~~[E:CS~LI~ ccs/sch ooIb11 s.pdf. 

tioll '11 pl'0vi:ks n g-f.~wd survey and syrltilcsis a f p~.cvious work on the issue, Ainol~g other things, 

c:onriudcs 4hat '"'LVhilc clrildren may only spend a few hours per day on school buses, the high levcls of 

cslil~o::\~rc cricounlcred on-hoard school buscs can add considerably to th& daily and annual uyosurcs to 

air r)c~lli~~:ln~s su uh as [clicscl pa~~iculatc matter] and PM2.5." 

41 Ncw BIT ~nswick I,unj; Assorintion, "Ex~,osurc of School Children to Dicscl Miaust from School 

I~II!:~.!;, 2005 (As rcportcd in O!?l.U, 2005) 

Avc:r;~r;c c:q>r>srrrc:i to Ph42.5 on school buscs wcrc 5-6 tiri~cs grcatcr than ambicnt Icvcls, avcrnb+g 32.1 

]I~/YII~. 'i~x~m~,tt~cs to l'M;!,.S, 1'Ml.O arltl black carbon wcrc folbund to bc a.pproxirnnt,ely thrcc timcs 

I-ligl blsr c11~l-i ng lri~!: ~irlcs thsn du.ri ng rlrc average walking commute. 

a P:'~PI':, D.R.., VViucr, A.M., rt of., "Chal-actciixing the: Rarig-c of C1JJ.dren's Pollutatlr Exposurc 

.I.)uri~,;; Scl~ool :[$us C:ort~~nt~tcs," ]!'in31 I{epost to the California Air Resources noard, 2003; 

a~ il abfc fro j.11 ~~~~~~~,c;l.r~;~,~Lrc~~~c~2/.s.choo1k~~$:!s.~:ho~c!~~u~~h~~~

On a.vc:ra.gc:: 0.0396 (range 0.02 - 0,29%1) of R bus's exhaust can penetrate thc cabin, as detcrnlincd tllrough 

t.hc 11.s~ uf 311 Sl:;'6 LrAc.cr rnctcred into thc crlgi110 exhaust. ?Pic rc1ati.v~ arnourlr oPexh;~usc exh;luscnsit:lc tbc bus 
MAY-16-2006 TUE 02: 14 PM FAX NO, 

h.igh(:r with thc windows doscd. The tracu conccn~rations messwed inside thc cabin correlatctl 

rcarooilldy wid wit11 black carl>on. Convrntional buses cwMbitcd higher conccntrations of blaclc cn~.lmn 

:tnd PAT]: tllatl onc o~~tfit~cd witha pa~~iculatc trap. 

& C:~lif~rnia Air Reso~~~~cts Board, ''Charactmi~i~lg d~e Rarlgc of Childrerl's Pollutant l?.q>osurc 

T)i~t-ing Schcwl BLIS Commutes," ARB StzftInterpret.ivc Surnrnary of Study J<esults, 2003; 

awila tJc 2 r y~yw,~rh.~a.ap'~v~rescar_~h/~c~~o_o~b~s~~~~~~ tnq.pd 

Comp2rcs thc P-vcragc 1b:iclc carban conmntrations nleasured by fir^ d al. in school buses (92 ~rg/m3) to 

cutrr.m rstions xncasui-cd in a d iCfc~cnt sturly in cars in Lor Angeles (5.9 pgh3). From t hcse 

VR~LI~~, (::A1113 s~niCrsti~nstcs a 3430 .incrcnsc i11 the daily expnsurc to black cubon. l'rcdicts iilcreascs it1 

tl ~c risli. of c;lnc.ar, astllm~ hospi~lization, and lower .rcsyiwtory symptoms. 

13 );iiz, I)., "Evaluation of I.:rrlission Control Equipmcm in a School Bus Application, Final lieport," 

I!rcparcd fix T3onaldson Company, 2003 

Mr:?s?-lrcd conrlcnsatiorr p;r~*tidc counts and lcvcls of PAH, VOC and CO jzlsidc the cabin of a school bus 

trvi.cl,it~:,. orl a ~acal. route sncl under stationary idling condjlions, in both cases with and without a second 

Lms in fro21 t, 'l'h~' sz z~ionary idling tests showed that interior conccntrations of pnr~iclcs in tllc trailing bus 

wert: rcc111crd vfllcn the lcat3i11g bus used control dcviccs, aftcr adjusting for hackgroulld levels. 

Spccific;~lly, 1.h~ reduction in puticle counts clue to a pdculatc trap wcrc 96% and roughly 60% clue to a 

tliccic.1 oxidstion catalysr - cr~rdwasc filtcr corn1:~ination. The use of a mnkcasc filter in conjunction with 

thc I~;~~~~id~ trap furthcr ~C~UCC~ pfi~tidc counts, The tests on moving buses appcarcd inconcliisivc 

h~c~~tisi: t:~c.I~~ro~~nd 1cds WCIC 1101' rr1~8surcd. 'rhc effect: of crankrdsc filters inay have been 

ur~clcri~xtir 11,11cd duc to thc lack ol PM2.5 rncasuremen ts. 

Wargo, J,, "C11il.drcn's Exposurc ro Dicscl Exl~a.ust on School Buses," 1Snvironmcnt and 1 J'uinan 

I Ir.;,\ttli, I nc., 2002; xuailablc at wv~r.ch~~i,~.o~~~~~~ports/diesd. 

13ascrl on rcsrl1i.s of pcrson:~I PM monitors won1 by studcnts during a scl~oal day, csrimatcs that lcvcls of 

1m.rtj(:111~1i! r~tilt~cr in and aratind school buses can bc up to 5-10 times Jlighcr than backgrol~nd lcvcls. 

Also rrladr. 1'1M2.5 and bleck cuboll rncasurcments inside crnpiy school buses during a simulated 1x1s 

roul s: a rttl whiI.ct idlitl~;. Tfle higllcst PM2.S Ic~rels dc~cc.tcd within buscs excccdc J lOOp.g/m3 d ring 7 of 

27 bl:,$ ¶-!Ins. 

S~lon>nn, G.M. c%. nj., "NO Xlrcathing in the Aisles: Dicscl Exhaust Xtlsidc School Buses," Natural 

l:cso\~ic r:~ 1)~f.n~~: Council, 2001; nvslilal-~le at; 

- wjwy! ..- - nrijccq~,q!ai t-/I GI r~~~?c?,<a$~~dschool lx~s(sb~~sin~.~s~ 

M'c,:~sr~rcd I'hf2.S and hlarlc. carbon inside 4 school buses in I,os Angclcs. Reports that dics~l d~al~st 

~nr~icrll:~ti: Icv,lr; insidr- rhc b~iscs (clcrivcd fro111 rllc black carbon n~cn.s\lrcmc~lts) ranged fror11 8-13 

pp;/1t\.'3, ~vllich was 10 #.+.00?/o I ~ighcr ihm thc Ic~~cls rncasurcd inside a passcngcr car driving dircctly ahcnd 

of tl.11: 1,trs. 
MAY-16-2006 TUE 02: 14 PM FAX NO, 

(J. Ira;cm, K.(.:.. (:I oZ., "Estirr~a(ion ofl'artia.~latc Maticr Canccritrarions in a Sd~ool. 1311s ISsirlg a 

Thcl -D;~:;ccl 'l'raccr - A S crisi tivt: and Specific Mct tlod for Q~antiljir~g Vehiclc Coritril~ui ions," 

'Jqr.:nt.r:;l>nl-t.ation llesenrd-\ Rccord, No. 1880, pp. 21-28,2004 (sr Ionger version is also available,: 

CaliforrJa EnSICI.IT, "Esdmatcd Concentrations of Dicscl Particulates Insidc a School Bus 

B:ist.d OII Traccr Arldccl to its F~id," prcparc.d for Intcnlatior~al Tmck arid Enginc Corfioratio~~, 

2003; av;i..i 1 a bl c at :y~~~rg~~QgscL~ch~~ojg?~.co m/~lef~~Jt~~~p~,ar,c.h;~y~~fact). 

Estirn:ttcil that 1c-; llnn 1% of thc PM2.5 pollution inside a school bur (022 p,g/:/m3 out of nn avclagl: d +. /L jq:5/11:'3) carnc frorn ~LY ow11 editi~ist: by mczsuring the amount of an iridium traccr addcd to the bus's 

dicrel file1 hat was collrcted on n filtcr inside lethe ci1,i.n. Coupled wi~h rncasurcd bn£ 

c.onot?ni.~:atic~ns of PM2.4 in a lead vehicle that urwe 30-40% greatcr than those measured in tllc study bus, 

~l~c; :lt>ihor:s rr)~rr.:luclc tll:~tls~e dicszl y:~r~icularc Jcvc;ls inside the bus :crc not fro111 t11c bus's cnginc but from 

o111er BOIZ~~:CR. Sincc the lead velticlc wns roughly5 rninutcs ahcad ofuhc bus, it is unclear how wc1l il~c 

:lt~nhicnt air in I flc ir-rlrrtrdiate vicinity of the bus IVS characterized. There is no discussion of the possiible 

inflt~cn.cc of C~IL~~CXSC emissions, a notable omission since other studies note that the crarlkcasc is 

ri:spo~isillt: :lor tllc;: brillc, of PM2.5 rnxss detcctcd inside bus c;~bins, which was rclatiwly high in this study 

(7% ly:/11\3 on s\l~;r;::;c). Tbc sclcction of an url~an bus route with high background I'M2.5 levels may 

J~:lvc cosifbur~rlrd thc i tr LI~~GI'ICC OF ~clr-~>ol111tiun. 

PY 1301.rrk, 1. ck al., "Con~p;~rison ofN1OSI-I 504.0 Mcthod vcrsus Acthalometer to Monitor Diescl 

Partic;ul~l.c in School Ruscs and at Work Sites," AIIU JOUL-nal, 64, p, 260, 2003; availn.ble 

thronj;lz ~~~,~~1i~~~~~2.~~p:/co~~t~~~t/~~~essj(Peiformed under contract to 

Ir'~tc-~-~~l'la iic>n:~l ''I'r~r dc and Enfiine Coiporation.) 

201r~:1~\1r;.tl I.,Incl; citrI>ori (1.0-1.2 ~l.g/ln3) with an acthalometer and, sirnultai~cously~ timc-weigbtcd 

:iv~;ri:/;;~; elernur\~al c;~rliun (< 1.0 \.r.g/m3 to 1.9 pg/rn3) with thc WIOSII 5040 Method inside 3 school, 

l:,u:+c.s a1.l a 17 a~sl-olnotivt tcst [:I-ack, Chtcstior~s t llc cf~cctivencss of acthalornctcrr: on moving vahiclcs 

1:uccntlsc tllcy \vt:ri: fo~incl to b~ scnsitivc to movcrntnt and vibration, potentixlty cauisir~g negative blacic 

c3rl)on rc:.r:nding.;, and suggcsts tI\c ix~stru~nent's ~rsclirlncss woztld bc limitcJ in nlovingvchicles (such a 

problem wa.s not c~bsc.rv(:rl l~y the CA'l.'P). 1kcl.usc no mcaswcrnents of l'M.2.5 Inass wrrc msdc, study 

c1oc.s. nr>t nclc!rer;s tf~c co~ltrihution fro171 111~ crankcase. 

a O'PJcill, D,, 'A Rcpl-eacnrativc S:implc of IFnirFt~x Corrrliy PubIic Schools Buscs Found to bt. Frcc 

of Si&$.licau~: Dic.sc.1 Exhaust," Fairfax County I'txtslic Sd~ools l.)cparrmcnt of G'cncral Scrvi~cs, 

2001,; :?vnih'(.)1~: at ~~,~,~~c~~t;,~.(?~/f~s/s~f~~f~-sc~~~i~/p~bLi~ati~ns/husexl~~

A4c~1s11rr:r-I l?M10, r.le~~~cr.~~:ll c:~rLorl (KC) and organic carbon (OC) on 12 buses over roughly 90 ininutc 

routct:;. All of rhc EC mcas~uscmcrrts ai~d 8 of 17, 1'MIO rnc9,surcmctlts wcrc bc1ow tllc rclativdy high P ? 

t3 utc.c~.ir)n Iirnits of 4-5 j.~z/sn3 and 5 1-65 l~,g/~n.'3, respccrivcly. I. hc four posi tivc PA410 rcadings ranged 

liolr~ 120-200 11,1;/m3, QC': lcvcls ranged from 50,-130 1.r.gl1113. The authors rcly on rl~c ladr of detcctablr? 

'1'CCl 10 COI\C~I.IC~L: ha^ tll~rt' w:~c; no evidence that the bus's cxlr~ust contaa~inat.ed zlle cabin, insrc:~d 

:kr tr;l.j\\~.;rig IIXC C,\>SC~VCL~ OC to gasolinc vehicle rra.flic. "l'llere is no discussior~ of tl~e high ]?.MI0 a~ld C)C 

lcvcl:;, ~ld.lir11 could I>c~ t.11~ resalt ~l?crankciist crnissions. 
May 2, 2006 

Texas Commission on Environmental Quality 

Dear Sir: 

Subject: Require Clean Air and Air Conditioning in all School Buses n 

Texas School Buses are being used year round to ferry students to 

to special events, sporting events, after school programs, and summer events. 

Remember when our school classes were not air conditioned and only a 

few teachers had fans in the room which were ineffective. For all the reasons 

that school rooms were air conditioned to improve learning, and for the health of 

the students, teachers, administrators, and employees, please see that all school 

buses are modified to filter out toxins, pollution, and also condition the air for 

comfort and health. 

'The first step would be to require all new school bus purchases be air 

conditioned and air filtered. 

The next step would be to establish an ongoing modification program of 

existing school buses to the new standards as time and budget allow. 

Bruce A. May 

21 06 Glenbrook Meadows Dr. 

Garland, Texas 75040-4 1 40 

Phone: 972-495-7835 

Fax: 972496-3355 

E-Mail: bruce.mav@verizon.net 

Enclosures 
lvlay 02 06; 09:l /p BRUCE MAY 

OFFICE OF THE GOVERNOR 

RICK PERRY 

GOVERNOR 

April 27,2006 

Mr. Bruce A. May 

2 106 Glenbrook Meadows Drive 

Garland, Texas 75040-4140 

Dear Mr. May: 

Thank you for taking the time to contact the Office of the Governor regarding your concerns. 

The U.S. Enviro~mental Protection Agency, a federal entity, has developed clean air standards 

with which states must comply. .Among other efforts to address this issue, Governor Perry has 

worked with school disbicts in Dallas/Fort Worth and Houston to reduce pollution caused by 

school buses. Further information is enclosed. 

Ultimately, decisions regarding school buses fall within the purview of local school district 

off~cials. School districts that wish to retrofit buses to reduce diesel emissions or purchase new 

buses may contact the Texas Commission on Environmental Quality to inquire about available 

grants for those purposes. School districts also have discretion to purchase air conditioned buses. 

Should you wish to pursue this issue at the local level, you may consider contacting your local 

school board members; contact information is enclosed. 

As you are aware, any change in state law would require legislative action. Should you wish to 

offer recommendations to Legislators, given their authority to introduce and vote on legislation; 

their contact information is enclosed. In the meantime, I have shared your comments with our 

budget and policy staff. , 

Please let us know if we may assist you in the future. 

~ede Keith 

Administration and Constituent Services 

Offlice of the Governor 

Enclosures 
lvlay U'L ~b UY:~ /p BKULt IVlHY Y /Z-4Y6-YYSS p.3 

Texas Governor Rick Perry - Press Release - October 7,2002 Page 1 o: 

Oct. 07, 2002 

Gov. Perry Applauds New Adopt-A-School Bus Program 

DaZlas/Fort Worth Program to Help Schools Buy New Buses, Retrofit Older Buses to Clean Air 

DALLAS - Gov. Rick Perry oined Environmental Protection Agency Administrator Christie Whitman 

today at the kickoff of an A B opt-A-School Bus program that aims to help Texas schoolchildren breathe 

a lide easier and provide a national model for innovative clean air pro, =rams. 

The program, which uses corporate s onsors to help school districts purchase clean buses or retrofit 

older buses, is a cooperative partners E ip between the American Lung Associatjon, the Environmental 

'--'.'-'-Prot'ection Agency, state agencies, local elected officials and corporate sponsors. The Dallas/Fort 

Worth program has set of goal of replacing 500 pre-lgg3 model diesel school buses in the area over the 

next three years. 

"The Ado t-A-School Bus program is more evidence that Texas is committed to improving air quality," 

Perry said: "The EPA and Administrator Whitman are to be commended for bringing together public and private partners in this unique effort. " 

Whitman said the Texas program will se& as a model that can be duplicated in other communities. 

"Working together, usin all the tools available to us, can really make a difference for the environment 

and? more important, for our children," Whitman said. "Cleaner buses mean fewer respiratory ailments, fewer school days lost to illness and a brighter, healthier future. I want to ap laud all those 

~.ho are supporting this important effort, including Governor Perry, state and local o cials and the 

Dallas business community. 

Ri 

More than one-third of the school buses in Texas predate current air ollution standards. Buses built 

before 1993 are allowed to emit up to six times more toxic soot an 8 up to three times more smo 

.forming nitrogen oxides than newer models. These older school buses expose children to greater leve 

of air pollution. 

% 
lvlay W Ub UY:l6p BKUCt lVlAY 

Texas Governor Rick Perry - Press Release - October 7,2002 Page 1 of 

Gov. Perry Announces Houston ISD to Convert Buses to Green 

Diesel 

Move Builds on State Actions to Help Clean Air in Southeast Texas, Goveranor Says 

HOUSTON - Gov. Rick Perry announced today that the Houston Independent School District has 

committed to convertin- more than 600 school buses to cleaner-burning green diesel fuel, a moveethat 

mill reduce nitrogen oxiae emissions by 46 tons a year. 

"In Texas, our commitment to clean air is unwavering," Perry said. "This is just the latest bit of good . .. . news, and it.builds on a number of visionary efforts and new laws that are working to clean our air. ' 

In June, Perry directed the Texas Department of Transportation to begin using cleaner diesel fuel in 75 

percent of its Houston district fleet and establish rules requiring its contractors worlcing in Southeast 

Texas to use cleaner-burning emulsified diesel fuel in off-road equi ment. Those actions are expected 

to remove 5.8 tons of nitrogen oxide, a major componeEt of air pol ution, from the air each day. That 

would amount to a reduction in emissions of at least 19 percent. 

P 

"By taking new measures to use cleaner, greener forms of fuel, we have every expectation that we will 

be able to raise the speed limit in Houston again in the very near future," Perry sald. 

To reinforce his point, the governor resented Entironmental Protection Agency (EPA) Administrator 

number 65. 

Christie Whiiman, who also attende 2 today's announcement, with a Houston Texans jersey bearing the 

In late September, the Texas Commission on Environmental Quality asked the EPA to consider raising 

Houston-area s eed limits to a maximum of 65 miles per hour. The EPA still must approve the change. The area's spee 5 limits were lowered earlier this year as part of a plan to comply with federal clean air , standards by 2 007.. Howeyer, later EPA studies concluded that lower speed limits would not achieve a 

significant reduction in pollutants. 

Houston ISD, the state's largest school district and the first to commit to using green diesel, will apply 

for a variety of grants to pay for the bus conversions. 
SIERRA 

CLUB 

FOUNDED 1892 

April 6, 2006 

Ms. Holly Vierk 

Office of Legal Services 

MC 205 

Texas Commission on Environmental Quality 

P.O. Box 13087 

Austin, Texas 7871 1-3087 

Houston Regional Group 

P. 0. Box 3021 

Houston, Texas 77253-3021 

713-895-9309 

http://texas.sierraclub.org/houston/ 

RECEIVED 

Dear Ms. Vierk, 

Enclosed are the comments of the Houston Regional Group of the Sierra Club 

(HSC) regarding the proposed new or amended 114.620, 114.622, 144.624, 

144.640, 114.642, 114.646, and 114.648. 

1) Under 114.622(c) and 114.644(e), the HSC supports permanently removing 

from the State of Texas "the old equipment or engine" via recycling, scrapping, or 

other permanent methods of removal or disabling so emissions are no longer 

generated. 

2) Under 114.644(a)(I) & (2), the HSC supports not limiting the use of diesel 

oxidation catalysts and particulate filters to certain school bus years. The HSC 

wants the installation of air pollution control devices to be as widespread as 

possible as quickly as possible to reduce the health risk to students. 

3) Under 114.644(d), the HSC supports paying for air pollution control devices on 

school buses that have 3 years of useful life left and not five years of useful life. 

The HSC wants the installation of air pollution control devices to be as 

widespread as possible as quickly as possible to reduce the health risk to 

students. 

The HSC supports the promulgation and approval of this series of rules. It is 

immensely important to reduce school bus diesel emissions to protect children 

and others from 'the health and welfare effects of toxic air emissions and 

precursors of ozone air pollution like nitrogen oxides and volatile organic 

compounds. 

"When we tly to pick out anything by itself, we find it hitched to everydung else in the universe." Joh MIfir 

Printed on 100% Kenaf tree free paper 
The HSC appreciates this opportunity to comment. Thank you. 

Sincerely, 

Brandt Mannchen 

Chair, Air Quality Committee 

Houston Regional Group of the Sierra Club 

hone Star Chapter 

5431 Carew 

Houston, Texas 77096 

71 3-664-5962 

brandtshnfbt@iuno.com 
TEXAS CENTER 

1:011 .llO1.lCI' Ii 1' 111)1 11 5 

May 16,2006 

Holly Vierk 

MC205 

Office of Legal Services 

Tew Commission on Environmental Quality 

P.O. Box 13087 

 us tin, TX 7871 1 

VIA FAX (512) 239-3187 

Dear Ms. Vjerk: 

W; Rule Project Number 2006-01 6-1 14-EN 

The Texas Center for Policy Studies appreciates the opportunity to provide comments 

on TCEQ's proposed rules to implement HB 3469, 79' Legslature. 

While nor actively involved in the legislation itself, we were disappointed that .the 

Legislature was unable 10 find funds for this important project - wluch will help to both 

reduce emissions - particularly particulate matter - and help improve rbe health of our 

school childxen (including my own children). We will be working wit11 both TCEQ and the 

Legislature through the appropriations precess to make sure &at there is hding made 

available to support this worthwhile effort 

Wit11 two exceptions, we suppori TCEQ's proposed rules to establish the Texas Ciean 

Bus Program. First, the rules should make it clear that the program is both intended to 

reduce emissions to the ambient air but also to improve the "micro-environment" of the 

school bus men itself - particularly where kids get in md off the bus. While the overall 

reductions in NOx and VOCs by retrofitting, repowering and replacing our older diesel 

buses is relatively small compared to other efforts, we see one of the rnain benefits as 

simply protec~ing our most precious resource - kids. The rules shodd reflect tltat 

honorable god nnd TCEQ sl~ould consider adding language in thc definition or preamble. 
Secondly, we believe that section 114,644 (b) is inconsiaent wirb both the intent and 

,even the statutory language oi HB 3469 and should be removed. HB 3469 was intended 

to not only serve the nomtlainment and early compact areas which has been smed by 

TERP funding, but also to be available to other areas where PM 2,5 standards and school 

children's Mth are threatened by older diesel buses. Indeed, a case can be made that rhe 

near nonattainment and attoinmen1 areas may have a greater need for potential grant 

funding since the nonattainment areas may be able to use other funding sources to replace 

older school buses or retrofit older models (such as "normal" TERP funding). During the 

2005 Legislative Session, I worked as a registered lobbyist for the Lone Star Chaprcr of 

the Sierra Club, and I can assure you ht much of the bipartisan support enjoyed by the 

legislation was predicated on the fwt that future funds could be used by all school 

districts around the state and not just those in Houston and Dallas. While we believe it is 

appropriare for TCEQ ro prioritize hding as it becomes available to "get the most bang 

for the buck," we do not believe we should put any limits in rhe rules themselves. 

The Texas Center for Policy Studies looks forward to working with the TCEQ staff in 

implementing rhe Texas Clean School Bus Program. We would urge the Cornrnission to 

build into its Legislative Appropriation Request mple funding for this important 

C y rus Reed 

Texas Center for Policy Studies 

cr(a?rem.scenter.org - 

5 12-740-4086 

cc, Reprcsenrative Sylvester Tumer 

Representarive Scott Hochberg 

Representative Warren Chisum 

Senaror Chris Harris 

Senator Kip Averitt 
UNITED STATES ENVIRONMENTAL PROTEC'TION AGENCY 

REGION 6 

1445 ROSS AVENUE, SUITE 1200 

DALLAS, TX 75202-2733 

May 16,2006 

Ms. Holly Vierk 

Office of Legal Services, MC 205 

Texas Commission on Environmental Quality 

P.O. Box 13087 

Austin, TX 7871 1-3087 

Dea Ms. Vierk: 

Thank you for the opportunity to comment on proposed revisions to the Texas 

Emission Reduction Plan (TERP) rules. The Texas Legislature enacted House Bill 3469 

in the 2005 Legislative Session to establish a clean school bus program for the State. We 

support the Texas Commission on Environmental Quality's efforts to make school bus 

retrofits pa. of the TERP funding program. Many studies have confirmed the 

detrimental effect of diesel exhaust on children's health. We support the proposed 

revisions, but we offer the following comments for your consideration. 

Modifications may be required to make the school bus retrofit program viable. 

Few retrofits are available that provide the substantial NOx reductions for which the 

TERP program was established. Therefore, it is improbable that these retrofits will meet 

the $13,00O/NOx ton reductions cost effectiveness standard that is proposed in Section 

114.622(d). We anticipate that using the referenced additional measures to evaluate the 

effectiveness of projects in reducing NOx will be necessary to accomplish the program's 

goals. Accordingly, we recommend that section 144.622(d) be revised to identify what 

the "additional measures" are in addition to, and that the commission provide guidance 

describing such additional measures and how they will be considered. 

In Section 114.640, Definitions, there should be a comma after the word "bus" to 

indicate that the final "that" clause does not apply to school buses but instead to the fuel. 

Additional documentation may be necessary if the clean school bus program is 

submitted as a State Implementation Plan (SIP) revision. Among other things, for any 

provisions submitted to EPA as a SIP revision, the state should provide a demonstration 

of the rules' consistency with section 1 lO(1) of the Clean Air Act. Please confirm your 

understanding of whether this action is consistent with section 1 lO(1). Also, for the clean 

RecycledlRecyclable .Printed with Vegetable Oil Based Inks on 100% Recycled Paper (40% Postconsumer) 
school bus program to be approvable into the SIP under the Economic Incentive program, 

reductions created by the plan must be surplus, quantifiable, enforceable, and permanent, 

and should be made consistent with the principles of equity and environmental benefit. 

See EPA 's Improvi~zg Air Quality with Economic Iizceiztive Programs guidance, chapters 

4 and 8 (January 2001). EPA considered this guidance in our approval of the previous 

TERP regulations in 2005 (70 FR 48647). We request you confirm that this revision 

continues to be consistent with this policy. 

Region 6 continues to offer Texas our support in implementing the TERP 

program. Please let us ltnow how we may be of further assistance by contacting me at 

(214) 665-3102 or Ms. Sandra Rennie of my staff at (214) 665-7367. 

Sincerely yours, 

Thomas H. Diggs 

Chief 

Air Planning Section 

cc: Ms. Candice Garrett 

Texas Commission on Environmental Quality 
INDEX OF ORAL TESTIMONY 

May 9, 2006, 2:00 p.m., Texas Commission on Environmental Quality 

No oral testimony was received pertaining to this proposal. 
Texas Commission on Environmental Quality 

Public Hearing Registration 

May 9,2006 

2:00 p.m. 

Rule Project No.: 2006-016-1 14-EN 

Short Title: HB 3469 and HB 2481: Texas Clean School Bus Program. 

Location: 12100 Park 35 Circle, Building F, Room 2210 

Concerning: Revisions to 30 TAC Chapter 114 

Presenting Oral Testimony? 

(Circle One) 

Yes No 

Yes No 

Yes No 

Yes No 

Yes No 

Yes No 

Name 

(Please Print) Representing 
EVALUATION OF 

TESTIMONY 
Texas Commission on Environmental Quality INTEROFFlCE MEMORANDUM 

To: Commissioners Date: September 1, 2006 

Thru: LaDonna Castaiiuela, Chief Clerk 

Glenn Shankle, Executive Director 

From: David C. Schanbacher, P.E., Chief Engineer 

Chief Engineer's Office 

Docket No.: 2005-2006-RUL 

Subject: Commission Approval for Rulemaking Adoption 

Chapter 114, Control of Air Pollution from Motor Vehicles 

House Bill (HB) 3469 and HB 248 1: Texas Clean School Bus Program 

Rule Project No. 2006-016-1 14-EN 

Reasons for the rule package: 

This rule package is necessary to comply with the provisions of HB 2481 (Representative Bonnen) and HB 

3469 (Representative Hochberg) from the 79th Legislature. HE3 3469 requires the agency to establish a 

grant program to provide funding to school districts, charter schools, and possibly regional planning 

commissions to use technologies that significantly reduce emissions of particulate matter (PM) from diesel 

school buses in Texas. The commission is directed to establish, by rule, "criteria for setting priorities for 

projects eligible to receive grants under this chapter." The grant program will provide grant funding to 

school districts, charter schools, and regional planning organizations. 

HB 2481 contains several provisions allowing the commission greater flexibility in determining costeffectiveness for grant applications that it considers for the Texas Emissions Reduction Plan (TERP) 

program. It also directs the commission to offer a rebate mechanism for certain project types under the 

TERP program. 

Under what authority are we adopting these changes? 

For the TERP program, the Subchapter K, Division 3 amendments and new sections are proposed under 

Texas Water Code, $5.102, which provides the commission with the general powers to carry out its duties 

under the Texas Water Code; $5.103, which authorizes the commission to adopt any rules necessary to 

carry out the powers and duties under the provisions of the Texas Water Code and other laws of this state; 

and $5.105, which authorizes the commission by rule to establish and approve all general policy of the 

commission. The amendments and new sections are also proposed under Texas Health and Safety Code, 

Texas Clean Air Act, $382.017, which authorizes the commission to adopt rules consistent with the policy 

and purposes of the Texas Clean Air Act; $382.01 1, which authorizes the commission to establish the level 

of quality to be maintained in the state's air and to control the quality of the state's air; $382.012, which 

authorizes the commission to prepare and develop a general, comprehensive plan for the control of the 

state's air; and Chapter 386, which establishes the TERP. Finally, the amendments and new sections are 

proposed as part of the implementation of HB 248 1. 

For the Texas Clean School Bus Program, the amendments and new sections are proposed under Texas 

Water Code, $5.102, which provides the commission with the general powers to carry out its duties under 

the Texas Water Code; $5.103, which authorizes the commission to adopt any rules necessary to carry out 
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the powers and duties under the provisions of the Texas Water Code and other laws of this state; and 

$5.105, which authorizes the commission by rule to establish and approve all general policy of the 

commission. The amendments and new sections are also proposed under Texas Health and Safety Code, 

Texas Clean Air Act; $382.017, which authorizes the commission to adopt rules consistent with the policy 

and purposes of the Texas Clean Air Act; $382.01 1, which authorizes the commission to establish the level 

of quality to be maintained in the state's air and to control the quality of the state's air; 8382.012, which 

authorizes the commission to prepare and develop a general, comprehensive plan for the control of the 

state's air; Chapter 386, which establishes the TERP; and Chapter 390, which establishes the Texas Clean 

School Bus Program. Finally, the amendments and new sections are proposed as part of the 

implementation of HB 3469. 

Is this rulemaking required by federal rule or state statute? Which ones? 

New Subchapter K, Division 4 applies to the Texas Clean School Bus Program, Texas Health and Safety 

Code, Chapter 390, §386.051(b) and 052(b). 

Are there any legal deadlines by which these rules must be adopted or effective? 

Agency policy is to have the rules adopted prior to the next regular legislative session. 

What issue(s) or problem(s) are we trying to solve? 

Division 3 changes address the following needs: 1) to clarify replacementlscrappage requirements for 

replacement and repower projects under the TERP program; 2) to include an option for the commission to 

use an equivalent measurement to the current $13,000 per ton cost effectiveness requirement; and 3) to 

establish a process for awarding rebates under the TERP program. These rule changes will improve the 

TERP program's efficiency to achieve nitrogen oxides (NOx) reductions in affected counties. NOx 

reductions will ultimately lower ozone levels. 

Proposed rules for Division 4 address the establishment of the Texas Clean School Bus Program. The new 

rules provide definitions necessary for the program, eligibility requirements for applicants, eligibility 

requirements for projects, the ability of the commission to establish funding priorities for the program, 

application requirements, and grant reporting requirements. This program will reduce exposure by the 

public and school children in particular to diesel exhaust from school buses. 

Why is it important that we do this rule package? 

1) to comply with state law; 

2) to make the TERP program more efficient; 

3) to maximize reductions of NOx emissions achieved by the TERP program; and 

4) provide a rule based foundation for the Texas Clean School Bus Program, which creates opportunities to 

reduce the exposure of children to air pollutants. 

Other important background or historical information. 

The TERP program was adopted during the 2001 legislative session. This state implementation plan (SIP) 

control strategy is aimed at reducing NOx emissions from diesel powered on-road and non-road equipment. 

Although there was not a specific appropriation for the Clean School Bus Program when it was enacted, 

HB 3469 allows NOx reduction projects to be funded for diesel powered school buses. School bus projects 
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to reduce NOx emissions have been funded to date and the agency will continue to fund school bus projects 

in the future. 

Scope of the rulemaking: 

The new clean school bus program rule establishes the basic authority and criteria for the commission to 

issue grants under the program. More specific guidelines regarding the types of projects that will be 

funded, how projects will be selected, and how the long-term monitoring and reporting requirements are to 

be met will be established through the program solicitation and contracting documents. The rule will: 

define the terms to be used in the Texas Clean School Bus Program; 

explain that the program applies to all school districts and charter schools in Texas with one or 

more diesel-fueled bus; 

identify the program requirements such as: 

the type of eligible projects (example - replacements, repowers, retrofits, qualifying fuel); 

provisions for the commission to apply restrictions for particular periods; 

use requirements and restrictions, such as five-year project life and use on a regular, daily 

route; 

provisions for the commission to limit the use of funds to incremental costs of new equipment 

and prohibition on reimbursement for administrative costs; 

allowances for grants to reduce pollutants other than PM and NOx; 

provide for the commission to award grants to regional planning commissions, councils of 

government, etc. to improve the ability of the program to meets its goals; and 

provide a program expiration date of August 3 1, 201 3. 

The rule revisions for the TERP program include: 

a clarification that, for replacement and repower projects, the baseline vehicle, equipment, or 

engine must be scrapped or otherwise permanently removed from the State of Texas; 

an option for the commission to use an equivalent measure to the current $13,000 per ton NOx 

reductions cost effectiveness requirement or an alternative approved by the commission; and 

a process for awarding rebate grants under the TERP program. 

The rulemaking is expected to be completed in September 2006, with the application forms for the Texas 

Clean School Bus Program completed thereafter. 

Changes required by federal rule: None. 

Changes required by state statute: 

o HB 2481 does not expressly require the commission to adopt new or revised rules for the 

TERP program. HB 3469 requires that the "commission by rule shall establish criteria for 

setting priorities for projects eligible to receive grants under this chapter." 

Staff recommendations that are not expressly required by federal rule or state statute: 

For the TERP program, proposed amendments and the new section in Division 3 are not expressly 

required by HB 2481. Those recommendations will: 

1) provide clarification that for replacement and repower projects, the baseline vehicle, equipment, or 

engine must be scrapped or permanently removed from the State of Texas; 
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2) provide a new definition of cost-effectiveness that clarifies how the commission will determine a 

project's cost effectiveness; and 

3) provide the basic requirements for a rebate grant program under TERP. 

For the Texas Clean School Bus Program, HB 3469 expressly requires the commission to "establish 

criteria for setting priorities for projects eligible to receive grants under this chapter7' by rule. Staff 

recommends the commission also establish by rule a set of basic program requirements, similar to basic 

TERP program requirements including: 

1) program definitions; 

2) applicability for school districts, charter schools, and regional planning organizations; 

3) basic program requirements and rules; 

4) monitoring and reporting requirements; and 

5) program expiration date. 

Impact on the regulated community: 

Who will be affected? 

Changes to the TERP rules (Division 3) will affect only those parties voluntarily applying for TERP 

grants. New rules for the Texas Clean School Bus Program (Division 4) will affect only those school 

districts, charter schools, and regional planning organizations voluntarily applying for grants under the 

established program. 

Does it create a group of affected persons who were not affected previously? How? 

Changes to the TERP rules (Division 3) will not create a group of persons who were not previously 

affected. New rules for the Texas Clean School Bus Program (Division 4) may create a group of school 

districts, charter schools, and regional planning organizations who were not previously affected. Those 

entities would only become affected if they voluntarily chose to apply for and receive grants under the 

Texas Clean School Bus Program. 

Will there be a fiscal impact? If so, estimate. 

The Texas Clean School Bus Program (Division 4) proposed rules provide a mechanism to implement the 

clean school bus program. The proposed amendments to Division 3 provide clarification to TERP program 

requirements. Fiscal implications (i.e., increased revenue) are anticipated for regional planning 

organizations, local school districts, and charter schools if they elect to participate in a clean school bus 

program. The Legislative Budget Board's fiscal note for HB 3469 estimated that school districts, charter 

schools, and regional planning organizations could realize approximately $1.7 million (based on 2006 

TERP revenues) per year. Parties voluntarily applying for and receiving a TERP grant may experience 

fiscal impacts (i.e., increased revenue). 

Impact on the public: 

Who will be affected? 
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The public, particularly school children and school staff, will benefit from proposed new rules in Division 

4 through the reductions in diesel exhaust from school buses. The public will benefit from proposed 

revisions to the TERP program rules (Division 3) through reduced emissions of NOx. 

Does it create a group of affected persons who were not affected previously? How? 

Adopted changes to Division 3 for the TERP program and new Division 4 for the Texas Clean School Bus 

Program will not create a new affected group. 

Will there be a ffical impact? If so, estimate. 

There is no projected cost to the public for this program. 

Impact on agency programs: 

For TERP program rules (Division 3), staff will need to put new administrative procedures in place. The 

commission will need to develop and implement a new Texas Clean School Bus grant program. 

Stakeholder meetings: 

Have any stakeholder meetings been held? 

The commission held a public hearing at TCEQ headquarters on May 9, 2006, but no one attended. 

There have been no stakeholder meetings held at this time. Staff will discuss these proposed changes to 

TERP program rules (Division 3) with potential TERP applicants at upcoming TERP workshops. 

With whom? N/A. 

What were the general sentiments? N/A. 

Were any changes made in response to stakeholder concerns? N/A. 

Policy issues: 

What policy issues are affected? 

The proposed rule changes to the TERP program (Division 3) impact air quality planning issues (SIP) for 

41 affected counties. The proposed rules for the Texas Clean School Bus Program primarily address PM 

pollution but allow for NOx emissions reduction projects as well. Texas currently has one area, the City of 

El Paso, which is nonattainment for PMIo. In light of the fact that the United States Environmental 

Protection Agency is proposing to revise the national ambient air quality standards for PM, the proposed 

new rules for the Texas Clean School Bus Program (Division 4) impact air quality planning issues for 

PMz.5 and PMcoarse. The state does not currently have nonattainment areas for PM2.5 or PMcoarse, but 

monitored PM levels in several counties are approaching the the proposed standards. Having a PM control 

strategy in place in these at-risk areas may be helpful. 
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Are any policies that are not currently based on rule being made into a rule? 

Staff recommends that the requirement for TERP grant recipients to remove baseline equipment in 

replacement or repower projects from affected counties be changed to require those grant recipients to 

permanently remove baseline equipment from the State of Texas. Staff makes the same recommendation 

for recipients of grants under the Texas Clean School Bus Program. 

Staff also recommends changes to how cost effectiveness for a project is calculated: "In calculating costeffectiveness, one-time grants of money at the beginning of a project shall be amualized using a time value 

of public funds or discount rate determined for each project by the commission, taking into account the 

interest rate on bonds, interest earned by state funds, and other factors the commission considers 

appropriate. " 

What are the consequences if this rulemaking is not approved to go forward? 

HB 3469 requires the commission to adopt criteria for program priorities by rule. Failure to adopt this 

provision would mean the commission has not complied with statutory requirements. 

Without these rule changes, the TERP program may have difficulty in maximizing the reductions achieved 

through the TERP program. 

Are there alternatives? 

HB 2481 requires the commission to establish, by rule, "criteria for setting priorities for projects eligible 

to receive grants under this chapter." Since much of the implementation of the TERP program is 

developed in the program guidelines, it might be possible to amend the current TERP emissions reduction 

incentive grants program guidelines to incorporate the clean school bus program criteria, without 

rulernaking. However, given the direction in HB 2481, it appears that rulemaking is required to implement 

the clean school bus program. 

Potentially controversial matters: 

Proposed amendments to the TERP program rules (Division 3), particularly the item referring to 

equivalent cost effectiveness criteria, may change the competitiveness of some types of projects. Some 

stakeholders may not support the resulting changes. 

Key points in adoption rulemaking schedule: 

Texas Register proposal publication date: April 14, 2006 

Anticipated effective date: October 12, 2006 

Six-month Texas Register filing deadline: October 14, 2006 
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Public comment: 

A public hearing was held on May 9, 2006 at which no oral comments were received. Written comments 

were received from the U.S. EPA (EPA), Houston Regional Group of the Sierra Club (HSC), the 

Environmental Defense Fund (EDF), the Texas Center for Policy Studies (TCPS), and one individual. All 

commenters expressed general support for the Texas Clean School Bus Program. The EPA and EDF also 

commented that many studies have shown that school bus exhaust can be harmful to children and school 

staff. Individual highlights: 

HSC commented that they favored the widest possible use of pollution control devices including broader 

model year eligibility and shorter project life requirements than are specified in HB3469. 

The EPA asked that the commission confirm that the rule changes were consistent with section 1 lO(1) (antibacksliding requirements) and federal guidance on economic guidance programs. 

The EDF, similarly to HSC, commented that particulate filters and catalysts are verified technologies on 

model year buses outside of the ranges specified in HB 3469. 

The EDF commented that the commission should find a way to fund pollution control devices on privately 

owned school buses that are contracted to school districts or charter schools. 

The EDF and TCPS commented that proposed $1 14.644(b), which allows the commission to prioritize 

clean school bus grants to certain parts of the state and certain projects, was inconsistent with HB3469. 

The EDF commented that when implementing a clean school bus program, the commission should 

emphasize administrative ease for school districts and charter schools by focusing grants on a small group 

of already verified technologies. 

Si-cant changes from proposal: 

No rule language was changed in response to public comments. Staff inserted language in the response to 

comments confirming the Division 3 and Division 4 rule changes were consistent with section 1 lO(1) of the 

Federal Clean Air Act and federal guidance on economic incentive programs - as requested by EPA. 

Agency contacts: 

Erik Gribbin, Rule Project Manager, 239-2590, Air Quality Planning and Implementation Division 

Brad Patterson, Staff Attorney, 239- 1201 

Holly Vierk, Texas Register Coordinator, 239-0177 

Attachments 
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cc: Chief Clerk, 5 copies 

Executive Director's Office 

David C. Schanbacher, P.E. 

Jason Skaggs 

Ashley K. Wadick 

Brent Wade 

Office of General Counsel 

Erik Gribbin 

Holly Vierk 

cc (without attachments): 

Brad Patterson, Staff Attorney 

Kerry Howard, Program Office Liaison 

Erik Gribbin, Division Liaison 

Booker Harrison, OLS Liaison. 

Russ Kimble, OLS 
EVALUATION OF TESTIMONY 

The Texas Commission on Environmental Quality (commission) adopts amendments to 

§I 14.620 and 51 14.622. The commission also adopts new 551 14.624, 114.640, 114.642, 

114.644, 114.646, and 114.648. The amendments and new sections are adopted without 

changes to the proposed text as published in the April 14, 2006, issue of the Texas Register 

(31 TexReg 3187) and will not be republished. 

'The amended §I 14.620 and §I 14.622 and new §§I 14.624, 114.640, 114.642, 114.644, 

114.646, and 114.648 are adopted to be submitted to the United States Environmental 

Protection Agency (EPA) as revisions to the state implementation plan (SIP). 

BACKGROUND AND SUMMARY OF THE FACTUAL BASIS FOR THE ADOPTED RULES 

House Bill (HB) 3469, 79th Legislature, 2005, added Chapter 390 to the Texas Health and 

Safety Code. This new chapter directs the commission to establish and administer a clean 

school bus program within the financial limits set by amended s386.051 and s386.052 (HB 

3469, 79th Legislature). This clean school bus program will fund efforts by school districts to 

improve the health of children by reducing emissions of diesel exhaust from school buses. 

Reduction of emissions from diesel-powered school buses will also benefit the public in ozone 

nonattainment areas by reducing emissions of nitrogen oxides (IVO,). 

The commission is adopting new 551 14.640, 1 14.642, 1 14.644, 1 14.646, and 1 14.648 to 

establish this program. Under these sections, school districts, charter schools, and regional 

planning organizations would be eligible for reimbursement grants for the use of emissions 

reducing catalysts, particulate filters, qualifying fuels, and other emissions reducing add-on 

equipment or technology that the commission finds will reduce emissions. 
House Bill 2481, 79th Legislature, 2005, added 5386.1 17 to the Health and Safety Code to add 

a rebate grant program under the Texas Emissions Reduction Plan (TERP). New §I 14.624 is 

adopted to implement this program. 'The rebate grant will streamline the grant application 

process for some applicants and will ease the administrative burden on the agency. 

Amendments to 51 14.622 will clarify that for replacement and repower projects, the baseline 

vehicle, equipment, or engine must be scrapped or permanently removed from the State of 

Texas. Amendments to §I 14.620 and 51 14.622 create an option for the commission to use an 

equivalent measure to the current $1 3,000 per ton cost effectiveness standard or an alternative 

approved by the commission. These amendments will improve TERP program effectiveness by 

ensuring that high-emitting engines cannot be reintroduced into an affected county and allowing 

the commission to increase the emissions reductions created by grants. 

SECTION BY SEC'l7ON DISCUSSION 

The commission adopts administrative changes throughout this rulemaking to be consistent with 

guidance provided in the Texas Legislative Council Drafting Manual, November 2004, and to 

conform with Texas Register requirements and agency guidelines. 

The adopted amendment to 51 14.620 modifies the definition of "Cost-effectiveness" to clarify 

how the cost-effectiveness of TERP grant applications will be determined. The adopted 

amendment to 51 14.622 clarifies that, for grants entailing replacement or repower of an engine 

or other equipment, the original equipment must be permanently removed from the State of 

Texas. The adopted amendment to 51 14.622 also clarifies that the commission may establish 

cost-effectiveness standards lower than the statutory $1 3,000 per ton and that the commission 

may also make project selection decisions on a variety of factors in addition to costeffectiveness. 
Adopted new §I 14.624, Rebate Grant Process, establishes a process that awards TERP funds 

as a rebate. This new process would provide for ongoing, first-come, first-served awarding of 

standardized rebates for designated project types. It would create a simple, streamlined 

process to award 'TERP funds. 

Amended §I 14.620 and 51 14.622 and new §I 14.624 are also adopted to be submitted to the 

EPA as revisions to the SIP. 

Adopted new §I 14.640, Definitions, provides definitions for the Texas Clean School Bus 

Program. This section provides definitions for important terms in the proposed new division. 

Adopted new §I 14.642, Applicability, establishes program eligibility for school districts and 

charter schools. This section also allows regional planning organizations, such as councils of 

government, and private nonprofit organizations to apply for and receive grants to improve the 

program. 

Adopted new §I 14.644, Clean School Bus Program Requirements, establishes basic program 

requirements, including: the types of projects eligible for a clean school bus grant; the ability of 

the commission to limit or prioritize funding for the Texas Clean School Bus Program; the 

minimum useful life of a project under the grant program; a requirement that replaced 

equipment be permanently removed from the State of Texas; restricting the use of grant funds 

to pay incremental costs associated with the project and prohibition against using the grant for 

administrative expenses; prohibition against recipients using grant funding to meet federal or 

state legal requirements and using emissions reductions as part of an emissions banking or 

trading program; grant application requirements; and obligation of the grant recipient to return 

grant funds if they fail to meet the terms of a project grant or conditions of the proposed division. 
Adopted new §I 14.646, Monitoring, Recordkeeping, and Reporting Requirements, establishes 

that grant recipients must adhere to the reporting requirements of their grant, which will occur no 

less frequently than annually. 

Adopted new §I 14.648, Implementation Schedule, establishes that the Texas Clean School Bus 

program will expire on August 31, 2013. 

New §§I 14.640, 114.642, 114.644, 114.646, and 114.648 are also adopted to be submitted to 

the EPA as revisions to the SIP. 

FINAL REGULATORY IMPACT ANALYSIS DETERMINATION 

The commission reviewed the rulemaking in light of the regulatory analysis requirements of 

Texas Government Code, §2001.0225, and determined that this rule action is not subject to 

S2001 .0025 because it does not meet the definition of a "major environmental rule" as defined 

in that statute. A "major environmental rule" means a rule the specific intent of which is to 

protect the environment or reduce risks to human health from environmental exposure and that 

may adversely affect in a material way the economy, productivity, competition, jobs, the 

environment, or the public health and safety of the state or a sector of the state. 

'The adopted amendments to Chapter 114 modify the existing rules in accordance with House 

Bill 3469, 79th Legislature, which amended Texas Health and Safety Code, §386.051(b) and 

added Texas Health and Safety Code, Chapter 390 to require the commission to establish a 

Clean School Bus Program. The Clean School Bus Program is intended to reduce diesel 

exhaust emissions from school buses by funding eligible projects. The adopted rule 

amendments are part of a voluntary incentive program with the goal of reducing diesel 

emissions and as such, the adopted rules will not adversely affect in a material way the 
economy, a sector of the economy, productivity, competition, jobs, the environment, or the 

public health and safety of the state or a sector of the state. 

Further, the adopted amendments to Chapter 114 modify the existing rules in accordance with 

House Bill 2481, 79th Legislature, which amended Chapter 386, Subchapter C of the Texas 

Health and Safety Code by adding 5386.1 17, directing the commission to adopt a process to 

award grants in the form of rebates to streamline the grant application, contracting, 

reimbursement, and reporting processes for certain projects under the TERP. These rule 

amendments will implement procedural changes and will have no effect on the environment or 

human health. 'These rule amendments are part of a voluntary incentive program with the goal 

of reducing diesel emissions and as such, the adopted rules will not adversely affect in a 

material way the economy, a sector of the economy, productivity, competition, jobs, the 

environment, or the public health and safety of the state or a sector of the state. 

In addition, a regulatory impact analysis is not required because the adopted rules do not meet 

any of the four applicability criteria for requiring a regulatory analysis of a "major environmental 

rule" as defined in the Texas Government Code. Section 2001.0225 applies only to a major 

environmental rule the result of which is to: 1) exceed a standard set by federal law, unless the 

rule is specifically required by state law; 2) exceed an express requirement of state law, unless 

the rule is specifically required by federal law; 3) exceed a requirement of a delegation 

agreement or contract between the state and an agency or representative of the federal 

government to implement a state and federal program; or 4) adopt a rule solely under the 

general powers of the agency instead of under a specific state law. This rulemaking does not 

exceed a standard set by federal law, and the adopted technical requirements are consistent 

with applicable federal standards. In addition, this rulemaking does not exceed an express 

requirement of state law and is not adopted solely under the general powers of the agency, but 
is specifically authorized by the provisions cited in the STA-I-LITORY AUTHORITY section of this 

preamble. Finally, this rulemaking does not exceed a requirement of a delegation agreement or 

contract to implement a state and federal program. 

The commission invited public comment on the draft regulatory impact analysis determination 

during the public comment period that ended May 16, 2006. No comments were received on 

the draft regulatory impact analysis. 

TAKINGS IMPACT ASSESSMENT 

The commission evaluated this rulemaking action and performed an analysis of whether the 

adopted rules are subject to Texas Government Code, Chapter 2007. The primary purpose of 

the rulemaking is to amend Chapter 114 in accordance with House Bill 3469 and House Bill 

2481. These amendments implement a voluntary program and only affect motor vehicles and 

equipment which are not considered to be private real property. Therefore, promulgation and 

enforcement of these adopted rules are neither a statutory nor a constitutional taking because 

they do not affect private real property. Therefore, these rules do not constitute a taking under 

Texas Government Code, Chapter 2007. 

CONSISTENCY WITH THE COASTAL MANAGEMENT PROGRAM 

The commission reviewed the adopted rulemaking and found that the rulemaking is subject to 

the Texas Coastal Management Program (CMP) in accordance with the Coastal Coordination 

Act, Texas Natural Resources Code, $533.201 et seq., and therefore must be consistent with all 

applicable CMP goals and policies. The commission conducted a consistency determination for 

the adopted rules in accordance with Coastal Coordination Act Implementation Rules, 31 TAC 

$505.22, and found the adopted rulemaking is consistent with the applicable CMP goals and 

policies. 
The applicable goal of the CMP is to protect, preserve, restore, and enhance the diversity, 

quality, quantity, functions, and values of coastal natural resource areas. The specific CMP 

policy applicable to these rules is that commission rules comply with 40 Code of Federal 

Regulations (CFR), to protect and enhance air quality in coastal natural resource areas (31 TAC 

5501.32). The commission reviewed this adopted rulemaking for consistency with the Texas 

CMP goals and policies in accordance with the regulations of the Coastal Coordination Council 

and determined that the amendments are consistent with CMP goals and policies because this 

rulemaking action would reduce air pollution from diesel-powered school buses. No new 

sources of air contaminants are authorized and nitrogen oxides and particulate air emissions 

would be reduced as a result of these rules. This adopted rulemaking complies with 40 CFR 

Part 51. This adopted action is part of the control strategy for ozone nonattainment areas in 

accordance with SIP requirements in 40 CFR Part 51 and reduces emissions of particulate 

matter consistent with National Ambient Air Quality Standards set for particulate matter in 40 

CFR Part 50. 

Promulgation and enforcement of these rules will not violate or exceed any standards identified 

in the applicable CMP goals and policies because the adopted rules are consistent with these 

CMP goals and policies, because these rules do not create or have a direct or significant 

adverse effect on any coastal natural resource areas, and because the adopted rules will 

reduce emissions of air pollutants. 

Written comments on the consistency of this rulemaking were invited during the public comment 

period which closed May 16, 2006. No comments were received on the consistency of this 

rulemaking with the CMP. 
PUBLIC COMMENT 

A public hearing on the adopted rules was held in Austin on May 9, 2006, at 2:00 p.m. at the 

Texas Commission on Environmental Quality Complex. The public comment period closed May 

16, 2006. No comments were received at the public hearing, but the commission did receive 

written comments from the Houston Regional Group of the Sierra Club (HSC), Environmental 

Defense (ED), the United States Environmental Protection Agency (EPA), the Texas Center for 

Policy Studies (TCPS), and one individual generally supporting the proposed rules. 

RESPONSE TO COMMENTS 

The HSC supports provisions in §I 14.622(c) and 51 14.644(e) which require grant recipients for 

replacement or repower projects to permanently remove old engines or vehicles from Texas. 

The commission appreciates the support. Removing these "old" vehicles or engines 

from use in Texas ensures that they cannot continue to pollute the air in Texas. 

The HSC does not support limiting the use of diesel oxidation catalysts and particulate filters to 

certain model years of school buses under §I 14.644(a)(I) and (2), but rather supports the 

widespread use of these pollution control devices. ED comments that these pollution control 

devices are verified by the U.S. EPA or certified by the California Air Resources Board for model 

years beyond those included in the proposed rules. ED asks that the commission expand the 

range of model years covered by the clean school bus program to match those for which there 

are verified technologies. 

The commission appreciates these comments. The model year designations in 

51 14.644(a)(I) and (2), 1994 for oxidation catalysts and 1994 to 1998 for particulate filters, 

reflect requirements set in the statute (Texas Health and Safety Code, §390.002). 'The 
commission notes that 51 14.644(a)(5) allows the commission to approve "other 

technologies that the commission finds will bring about significant emissions 

reductions." This ability would allow the commission to fund a wide variety of emissionreducing projects. The commission did not revise the proposed rules as a result of this 

comment. 

The HSC supports reducing the requirement for a project life of five years proposed under 

§I 14.644(d) to three years of useful life. The HSC wants installation of pollution control devices 

to be as widespread as possible as quickly as possible. 

The commission appreciates this comment. The requirement for five years of useful life 

proposed under 51 14.644(d) reflects statutory requirements (Texas Health and Safety 

Code, §390.004(b)). State law and the proposed rule (§I 14.644(d)) also allow for a 

pollution control device to be used on a particular school bus for a period less than five 

years if that pollution control device is reinstalled on another school bus for the 

remainder of the required five years. 

One individual comments school buses are used year-round for a variety of activities such as 

class, special eventslfield trips, sporting events or other competitions, summer events, and after 

school programs. 

The commission acknowledges this comment. 

One individual comments school buses should be air-conditioned and filtered, similar to 

classrooms, in order to increase learning and protect the health of students, teachers, and other 

staff. The first step in protecting students and teachers from exposure to air pollution on school 
buses would be to require that all new school buses be air-conditioned and fitted with filters. 

The second step would be to establish a modification program for existing school buses so that 

standards for existing buses could be met as time and budget allow. 

Air-conditioning school buses is outside the scope of this rulemaking. 'The commission 

agrees that reducing air pollution from school buses would help protect the health of 

students, teachers, and other staff who work in our school systems. 

The EPA and ED comment that many studies have confirmed the detrimental effect of diesel 

exhaust on children's health and that they support the commission's efforts to establish a clean 

school bus program for the State of Texas. 

The commission appreciates the support. 

The EPA comments that there are very few retrofits available that provide the substantial NO, 

reductions for which the TERP program was established. It is improbable those retrofits would 

meet the $1 3,000 per ton cost effectiveness requirements used in the TERP program. They 

comment making the clean school bus program a viable part of the TERP program could require 

some modifications to the program. The EPA recommends proposed §I 14.622(d) be revised to 

identify what the "additional measures" are in addition to, and that the commission provide 

guidance describing such additional measures and how they will be considered. 

The commission notes while the TERP program and the Clean School Bus program 

share a similar method of finance, they are two separate programs. The programs are 

authorized by separate chapters of the Texas Health and Safety Code. Furthermore, 

Texas statute and the commission's rules do not establish a specific cost effectiveness 
requirement for emissions reduction projects under the Clean School Bus program. 

Section 114.622(d) does not apply to projects under the newly adopted Division 4. The 

commission did not revise the proposed rules as requested. 

The EPA recommends the proposed definition of "Qualifying fuel" under $1 14.640 be modified 

by placing a comma after the word "bus" to indicate that the final "that" clause does not apply to 

school buses but instead to the fuel. 

The commission appreciates the EPA's comment. The definition included in the rule is 

the literal definition that was adopted into the Texas Health and Safety Code by the 79th 

Legislature. The commission did not revise the proposed rules as suggested. 

The EPA comments additional documentation may be necessary if the clean school bus 

program is submitted as a SIP revision. More specifically, the EPA comments the commission 

should provide a demonstration of the adopted rules' consistency with Federal Clean Air Act, 

$1 1 O(1). -The EPA also corr~ments if the clean school bus program is to be approvable into the 

SIP under the Economic lncentive Program, reductions must be surplus, quantifiable, 

enforceable, and permanent. The EPA requests the commission confirm that the adopted rule 

changes are consistent with Federal Clean Air Act, $1 lO(1) and with its guidance entitled "EPA's 

Improving Air Quality with Economic lncentive Programs" (Chapters 4 and 8, January 2001). 

The EPA notes it has previously approved the TERP program under these conditions. 

Adopted rules for the Texas Clean School Bus Program are consistent with requirements 

of the Federal Clean Air Act, §110(1). Under the EPA's guidance for economic incentive 

programs, the Texas Clean School Bus Program meets the requirements of a financial 

mechanism economic incentive program. Although the Clean School Bus Program 
derives its funding from the same source, the program is separate from the TERP 

Emissions Reduction Inventive Grant Program. The primary requirements of the EPA 

guidance are: 

Surplus: Under the Clean School Bus Program an activity will not be eligible if it is 

required by any state or federal law, regulation, memorandum of agreement, or other 

legally binding document. The program solicitation documents and grant instructions 

will outline additional restrictions and describe other eligible activities. 

Enforceable: The Clean School Bus program will require a review of each project funded. 

Contracts will require achievement of the emission reductions over the designated 

project life. Emission reductions will be verified through reports on use of the grantfunded buses and on-site monitoring and audit visits. Contracts will contain provisions 

that allow the state to recapture grant money for the failure to comply with grant 

obligations. The reports and monitoring activities will be used by TCEQ to track 

compliance and effectiveness of the grant recipients in fulfilling their obligations under 

the contract. The TCEQ may, at any time, before or after reimbursement, request 

additional evidence concerning costs. 

Quantifiable: Emissions reductions achieved through the Texas Clean School Bus 

Program will be quantified using a comparison of baseline NOx and particulate matter 

emissions with reduced NOx and particulate matter emissions. Engine emissions 

certifications and retrofit system verifications by the EPA will be used to verify the 

emissions of the reduced-emissions engines and retrofit systems. Baseline emission 

rates for uncontrolled engines will be based on factors developed and used for SIP 

modeling purposes by the TCEQ. 
The Clean School Bus Program solicitation documents and grant instructions will outline 

the approach for determining incremental costs, emission reductions and costeffectiveness. The application forms will require the applicant to provide data on the 

incremental costs of each activity, vehicle or equipment usage patterns, and information 

about the vehicle or equipment needed to determine emission rates. Emission factors, 

load factor, and usage pattern information will be used by the TCEQ to calculate 

emission reductions attributed to an activity. The solicitation documents and grant 

instructions will contain information on how to determine the level of NOx and particulate 

matter emissions for the baseline and the new vehicle and equipment. Using this 

information, the TCEQ will determine the emissions reductions and cost effectiveness of 

the project. 

For a project to be eligible for Clean School Bus Program funding, the emission rate of 

engines or the emission reduction factor for retrofit systems must be certified or verified 

under an applicable EPA certification or verification program. In accordance with 

agreements between the EPA and California Air Resources Board (CARB), CARB 

certification or verification will also be accepted. In some cases, the TCEQ may also 

accept testing results under EPA, CARB, andlor TCEQ approved test protocols to 

determine the emission rate or emission reduction factor. This approach will provide the 

most flexibility for the program while also restricting the evaluation process to those 

technologies or products that can provide documentation that will be acceptable to the 

E PA. 

Permanent: The TCEQ will establish minimum requirements for the life of a project, 

which will be at least five years. The project life will be the period in which the grant 

recipient is contractually obligated to monitor and report on the use of the grant-funded 
vehicle, equipment, andlor fuel. Environmental benefits from projects under the Clean 

School Bus Program will occur for at least this period. Emissions reductions achieved 

through this program are contractually and statutorily permanent for the project life 

established in the grant contract and will be permanently retired. Emissions reductions 

from the Clean School Bus Program will not be usable in an averaging, banking, or 

trading program. 

General Equity Principle and Environmental Justice Principle: The Texas Clean School 

Bus Program is not a banking and trading program so program disbenefits are not 

expected. By design, this program reduces NOx and particulate matter emissions with a 

concentration on cleaner diesel engines through economic incentives in the form of 

grants. Eligible projects include (but are not necessarily limited to) diesel oxidation 

catalysts, diesel particulate filters, purchase and use of emission reducing add-on 

equipment, the use of qualifying fuel, and other technologies that the commission finds 

will bring about significant emissions reductions. 

Penalty ~rovisions: Upon the performing party's failure to comply with the requirements 

of a Clean School Bus grant, the TCEQ may, at its own discretion, require that the 

performing party return or repay all or a portion of the reimbursement funds. 

Procedures for Public Disclosure of Information and Provisions for Addressing 

Uncertainty: Performing parties will maintain project financial information and data used 

in the preparation or support of any request for reimbursement (direct and indirect) and 

copies of any cost information or analysis submitted to the TCEQ. The TCEQ, the Texas 

State Auditor's Office, or any of their authorized representatives will have access to all 

such books, records, documents, and other evidence for the purpose of review, 
inspection, audit, excerpts, transcriptions, andlor copying during normal business hours. 

Furthermore the performing party must agree to the disclosure of all information and 

reports resulting from access to records under the grant. 

Additionally, property records of grant equipment will be maintained that describe the 

usage, ownership, and any other details as outlined in the grant contract. All data and 

other information developed under the grant agreement will be furnished to the TCEQ 

and will be public information except to the extent that it is exempted from public access 

by the Texas Public Information Act, Texas Government Code, Chapter 552. 

Safeguards will be established to monitor program funding and emission reductions. 

Applicants of Clean School Bus Program funding will be required to monitor the use of 

grant-funded vehicles, equipment, and fuel and to report to the TCEQ for the life of each 

grant-funded activity. Grant recipients will be required to complete the project according 

to the time frames explained in the grant agreement. 

Adopted revisions to the TERP program rules in Division 3 are also consistent with 

Federal Clean Air Act, §llO(I) and are being submitted to the EPA as a SIP revision. The 

adopted rules will serve to make the program more accessible and more cost-effective; 

thereby making the program more effective overall. As the EPA notes in its comment, 

the TERP program is already approved under federal guidelines for economic incentive 

programs and the revised rules will continue to meet federal guidance. 

ED generally supports the rule and comments that it is crucial to have basic rules in place for 

the Texas Clean School Bus Program so that the commission can proceed quickly to award 

grants when funding becomes available. 
The commission agrees and appreciates ED's support. 

ED and TCPS comment while they generally support the rules as proposed, they would like to 

see the rules refined to "better reflect the legislatively-stated goal of improving the 'rnicroenvironment' in and around school buses." 

'The commission contends the adopted rules for the Texas Clean School Bus Program 

are consistent with HB 3469. The adopted rules develop the basic framework of a clean 

school bus program. The program will be implemented with a more comprehensive set 

of guidelines and requirements. 

ED supports new §I 14.640 and $1 14.642. ED notes certain school districts contract out some 

or all of their transportation services to private companies and suggests that the commission 

explore ways to ensure buses operated by third parties can participate in the Texas Clean 

School Bus program. 

'The commission appreciates ED's support. HB 3469, as enacted, empowers the 

commission to issue grants only to school districts (including countywide school 

districts), charter schools, a regional planning commission (or a similar regional agency 

created under Texas Government Code, Chapter 391), councils of government, and 

private nonprofit organizations. The commission is not aware of a way to include buses 

owned by private companies in the Texas Clean School Bus Program, but it does 

welcome further ideas from stakeholders as the program is implemented. 

ED and TCPS comment that proposed $1 14.644(b) is inconsistent with the statutory language 

of HB 3469 and should be removed. 
'The commission contends proposed §114.644(b) is consistent with language in HB 3469 

which gives the commission the authority to "establish criteria for setting priorities for 

projects eligible to receive grants under this chapter" (Texas Health and Safety Code, 

§390.004(a)). Setting program priorities will allow the commission to ensure that 

available funds are spent as effectively as possible. 

ED comments the commission should clarify what it means by "additional pollutants to be 

addressed" during a funding period (§I 14.644(c)). ED contends that such language is 

superfluous in light of the specific technologies enumerated in §I 14.644(a). 

In order to spend available funds as effectively as possible, the commission wishes to 

have the ability to prioritize one or more pollutants over others if scientific evidence 

warrants such a priority. 

ED comments the clean school bus program should be made as simple as possible for school 

districts by expressly targeting grants to a small number of already verified technologies like 

those in §I 14.644(a). It believes administrative ease will attract participation from smaller 

school districts. 

'The commission appreciates ED'S suggestion. 
STAFF 

RECOMMENDATIONS 
SUBCHAPTER K: MOBILE SOURCE INCENTIVE PROGRAMS 

DIVISION 3: DIESEL EMISSIONS REDUCTION INCENTIVE PROGRAM FOR ON-ROAD 

AND NON-ROAD VEHICLES 

51 14.620, 51 14.622, 51 14.624 

STATUTORY AUTHORITY 

The amendments and new section are adopted under Texas Water Code, s5.102, which 

provides the commission with the general powers to carry out its duties under the Texas Water 

Code; s5.103, which authorizes the commission to adopt any rules necessary to carry out the 

powers and duties under the provisions of the Texas Water Code and other laws of this state; 

and 55.105, which authorizes the commission by rule to establish and approve all general policy 

of the commission. The amendments and new section are also adopted under Texas Health , 

and Safety Code, Texas Clean Air Act, s382.017, which authorizes the commission to adopt 

rules consistent with the policy and purposes of the Texas Clean Air Act; s382.011, which 

authorizes the commission to establish the level of quality to be maintained in the state's air and 

to control the quality of the state's air; s382.012, which authorizes the commission to prepare 

and develop a general, comprehensive plan for the control of the state's air; and Chapter 386, 

which establishes the TERP. Finally, the amendments and new section are adopted as part of 

the implementation of House Bill 2481, 79th Legislature, 2005. 

The adopted amendments and new section implement Texas Clean Air Act, ss382.002, 

382.01 1, 382.01 2, 382.01 7, 386.051, and House Bill 2481, 79th Legislature, 2005. 
§I 14.620. Definitions. 

Unless specifically defined in the Texas Clean Air Act (TCAA) or in the rules of the 

commission, the terms used in this subchapter have the meanings commonly ascribed to them 

in the field of air pollution control. In addition to the terms which are defined by the TCAA; and 

553.2, 101.1, and 1 14.1 of this title (relating to Definitions), the following words and terms, when 

used in this division shall have the following meanings, unless the context clearly indicates 

otherwise. 

(1) Cost-effectiveness--The total dollar amount expended divided by the total 

nurr~ber of tons of nitrogen oxides emissions reduction attributable to that expenditure. In 

calculating cost-effectiveness, one-time grants of money at the beginnirlg of a project shall be 

annualized using a time value of public funds or discount rate determined for each project by the 

commission, taking into account the interest rate on bonds, interest earned by state funds, and 

other factors the commission considers appropriate. 

(2) Guidelines-- Texas Emissions Reduction Plan: Guidelines for Emissions 

Reduction lncentive Grants Program (RG-388) adopted by the commission under Texas Health 

and Safety Code, 5386.053, as amended. 

(3) Incremental cost--The cost of an applicant's project less a baseline cost that 

would otherwise be incurred by an applicant in the normal course of business and may include 

added lease or fuel costs as well as additional capital costs. 
(4) Motor vehicle--A self-propelled device designed for transporting persons or 

property on a public highway that is required to be registered under Texas Transportation Code, 

Chapter 502. 

(5) Non-road diesel--A vehicle or piece of equipment, excluding a motor vehicle 

or on-road diesel, that is powered by a non-road engine, including: non-road non-recreational 

equipment and vehicles; construction equipment; locomotives; marine vessels; and other highemitting diesel engine categories. 

(6) Non-road engine--An internal combustion engine that is in or on a piece of 

equipment that is self-propelled or that propels itself and performs another function, excluding a 

vehicle that is used solely for competition, or a piece of equipment that is intended to be 

propelled while performing its function, or a piece of equipment designed to be and capable of 

being carried or moved from one location to another. 

(7) On-road diesel--An on-road diesel-powered motor vehicle that has a gross 

vehicle weight rating of 8,500 pounds or more. 

(8) Qualifying fuel--Any liquid or gaseous fuel or additives registered or verified 

by the United States Environmental Protection Agency that is ultimately dispensed into a motor 

vehicle or on-road or non-road diesel that provides reductions of nitrogen oxides emissions 

beyond reductions required by state or federal law. 

(9) Repower--To replace an old engine powering an on-road or non-road diesel 

with a new engine; a used engine; a remanufactured engine; or electric motors, drives, or fuel 

cells. 
(10) Retrofit--To equip an engine and fuel system with new emissions-reducing 

parts or technology verified by the United States Environmental Protection Agency after 

manufacture of the original engine and fuel system. 

(1 1) Small business--A business owned by a person who: 

(A) owns and operates not more than two vehicles, one of which is: 

(i) an on-road diesel with a pre-1994 engine model; or 

(ii) a non-road diesel with an engine with uncontrolled emissions; 

and 

(B) has owned the on-road or non-road diesel for more than one year. 

5114.622. Incentive Program Requirements. 

(a) Eligible projects include: 

(1) purchase or lease of on-road and non-road diesels; 

(2) emissions-reducing retrofit projects for on-road or non-road diesels; 

(3) emissions-reducing repower projects for on-road or non-road diesels; 
(4) purchase and use of emissions-reducing add-on equipment for on-road or 

non-road diesels; 

(5) development and demonstration of practical, low-emissions retrofit 

technologies, repower options, and advanced technologies for on-road or non-road diesels with 

lower nitrogen oxides (NO,) emissions; 

(6) use of qualifying fuel; 

(7) implementation of infrastructure projects; 

(8) replacement of on-road and non-road diesels with newer on-road and nonroad diesels; and 

(9) other projects that have the potential to reduce anticipated NO, emissions 

from diesel engines. 

(b) For a proposed project as listed in subsection (a) of this section, other than a project 

involving a marine vessel or engine, not less than 75% of vehicle miles traveled or hours of 

operation projected for the five years immediately following the award of a grant must be 

projected to take place in a nonattainment area or affected county of this state. 

(c) For a proposed project that includes a replacement of equipment or a repower, the 

old equipment or engine must be recycled, scrapped, or otherwise permanently removed from 

the State of Texas. 
(d) To be eligible for a grant, the cost-effectiveness of a proposed project as listed in 

subsection (a) of this section, except for infrastructure projects and infrastructure purchases that 

are part of a broader retrofit, repower, replacement, or add-on equipment project, must not 

exceed a cost-effectiveness of $1 3,000 per ton of NOx emissions reduced. The commission 

may set lower cost-effectiveness limits as needed to ensure the best use of available funds. 

The commission may also base project selection decisions on additional measures to evaluate 

the effectiveness of projects in reducing NOx emissions in relation to the funds to be awarded. 

(e) Projects funded with a grant from this program may not be used for credit under any 

state or federal emissions reduction credit averaging, banking, or trading program except as 

provided under Texas Health and Safety Code, s386.056. 

(f) A proposed project as listed in subsection (a) of this section is not eligible if it is 

required by any state or federal law, rule or regulation, memorandum of agreement, or other 

legally binding document. This subsection does not apply to: 

(1) an otherwise qualified project, regardless of the fact that the state 

implementation plan assumes that the change in equipment, vehicles, or operations will occur, if 

on the date the grant is awarded the change is not required by any state or federal law, rule or 

regulation, memorandum of agreement, or other legally binding document; or 

(2) the purchase of an on-road diesel or equipment required only by local law or 

regulation or by corporate or controlling board policy of a public or private entity. 

(g) A proposed retrofit, repower, replacement, or add-on equipment project must 

achieve a reductior~ in NO, emissions to the level established in the commission's Texas 
Emissions Reduction Plan: Guidelines for Emissions Reduction lncentive Grants Program (RG388) for that type of project compared with the baseline emissions adopted by the commission 

for the relevant engine year and application. 

(h) If a grant recipient fails to meet the terms of a project grant or the conditions of this 

division, the executive director can require that the grant recipient return some or all of the grant 

funding to the extent that emission reductions are not achieved or cannot be demonstrated. 

(i) Criteria established in the guidelines, including revisions to the commission's Texas 

Emissions Reduction Plan: Guidelines for Emissions Reduction lncentive Grants Program (RG388), apply to the Texas Emissions Reduction Plan program. Notwithstanding the provisions of 

this chapter, as authorized under Texas Health and Safety Code, §386.053(d), revisions to the 

guidelines may include, among other changes, adding additional pollutants; adding stationary 

engines or engines used in stationary applications; adding vehicles and equipment that use 

fuels other than diesel; or adjusting eligible program categories; as appropriate, to ensure that 

incentives established under this program achieve the maximum possible emission reductions. 

51 14.624. Rebate Grant Process. 

(a) This section establishes a process to provide fast and sirr~ple access to rebate 

grants, in accordance with Texas Health and Safety Code, S386.117. 

(b) The rebate grant process shall: 

(1) designate certain types of projects eligible for rebates; 
(2) project standardized oxides of nitrogen emissions reductions for each 

designated project type; 

(3) assign a standardized rebate amount for each designated project type; 

(4) allow for processing rebates on an ongoing first-come, first-served basis; and 

(5) consolidate, simplify, and reduce the administrative work for applicants and 

the commission associated with grant application, contracting, reimbursement, and reporting 

processes for designated project types. 

(c) The commission may: 

(1) award rebate grants as a pilot project for a specific region or may award the 

grants statewide; 

(2) limit or expand the designated project types as necessary to further the goals 

of the program; and 

(3) administer the rebate grants or may designate another entity to administer 

the grants. 
SUBCHAPTER K: MOBILE SOURCE INCENTIVE PROGRAMS 

DIVISION 4: TEXAS CLEAN SCHOOL BUS PROGRAM 

§§114.640, 114.642, 114.644, 114.646, 114.648 

STATUTORY AUTHORITY 

The new sections are adopted under Texas Water Code, 55.102, which provides the 

commission with the general powers to carry out its duties under the Texas Water Code; 

55.103, which authorizes the commission to adopt any rules necessary to carry out the powers 

and duties under the provisions of the Texas Water Code and other laws of this state; and 

55.105, which authorizes the commission by rule to establish and approve all general policy of 

the commission. The new sections are also adopted under Texas Health and Safety Code, 

Texas Clean Air Act, 5382.017, which authorizes the commission to adopt rules consistent with 

the policy and purposes of the Texas Clean Air Act; 5382.011, which authorizes the commission 

to establish the level of quality to be maintained in the state's air and to control the quality of the 

state's air; 5382.012, which authorizes the commission to prepare and develop a general, 

comprehensive plan for the control of the state's air; Chapter 386, which establishes the TERP; 

and Chapter 390, which establishes the Clean School Bus Program. Finally, the new sections 

are adopted as part of the implementation of House Bill 3469, 79th Legislature, 2005. 

The new sections implement Texas Clean Air Act, 55382.002, 382.01 1, 382.012, 382.017, 

386.051, and House Bill 3469, 79th Legislature, 2005. 

51 14.640. Definitions. 

Unless specifically defined in the Texas Clean Air Act (TCAA) or in the rules of the 

commission, the terms used in this subchapter have the meanings commonly ascribed to them 

in the field of air pollution control. In addition to the terms that are defined by the TCAA and 
$53.2, 101 .I, and 114.1 of this title (relating to Definitions), the following words and terms, when 

used in this division shall have the following meanings, unless the context clearly indicates 

otherwise. 

(1) Diesel exhaust--One or more of the air pollutants emitted from an engine by 

the combustion of diesel fuel, including particulate matter, nitrogen oxides, volatile organic 

compounds, air toxics, and carbon monoxide. 

(2) Incremental cost--The cost of an applicant's project less a baseline cost that 

would otherwise be incurred by an applicant in the normal course of business. Incremental 

costs may include added lease or fuel costs as well as additional capital costs. 

(3) Qualifying fuel--Includes any liquid or gaseous fuel or additive registered or 

verified by the United States Environmental Protection Agency, other than standard gasoline or 

diesel, that is ultimately dispensed into a school bus that provides reductions of emissions of 

particulate matter. 

(4) Repower--To replace an old engine powering an on-road or non-road diesel 

with a new engine; a used engine; a remanufactured engine; or electric motors, drives, or fuel 

cells. 

(5) Retrofit--To equip an engine and fuel system with new emissions-reducing 

parts or technology verified by the United States Environmental Protection Agency after 

manufacture of the original engine and fuel system. 
51 14.642. Applicability. 

(a) Any school district or charter school in this state that operates one or more dieselfueled school buses or a transportation system provided by a countywide school district may 

apply for and receive a grant under the program. 

(b) The commission may allow a regional planning commission, council of governments, 

or similar regional planning agency created under Local Government Code, Chapter 391, or a 

private nonprofit organization to apply for and receive a grant to improve the ability of the 

program to achieve its goals. 

51 14.644. Clean School Bus Program Requirements. 

(a) Eligible projects include: 

(1) diesel oxidation catalysts for school buses built before 1994; 

(2) diesel particulate filters' for school buses built from 1994 to 1998; 

(3) the purchase and use of emission-reducing add-on equipment for school 

buses, including devices that reduce crankcase emissions; 

(4) the use of qualifying fuel; and 

(5) other technologies that the commission finds will bring about significant 

emissions reductions. 
(b) The commission may limit funding under a particular funding round to certain areas 

of the state, types of applicants, andlor types of projects. The commission may place a priority 

on funding for projects conducted in areas that do not attain certain national ambient air quality 

standards. 

(c) Prior to each funding period, the commission may establish priorities and other 

criteria for reductions in diesel exhaust emissions to be achieved by projects funded during that 

period, including designation of additional pollutants to be addressed. A proposed project must 

achieve a reduction in emissions of diesel exhaust compared with the baseline emissions 

according to the percentage reduction level and other priorities established by the commission. 

The commission may also establish maximum levels for the funding awarded in relation to the 

emission reductions projected to be achieved by a project, in order to maximize the use of . 

available funds. 

(d) A school bus proposed for retrofit must be used on a regular, daily route to and from 

a school and have at least five years of useful life remaining unless the applicant agrees to 

remove the retrofit device at the end of the life of the bus and reinstall the device on another 

bus. 

(e) For a proposed project that includes a replacement of equipment or a repower, the 

old equipment or engine must be recycled, scrapped, or otherwise permanently removed from 

the State of Texas. 

(f) An application for a grant under this program is only eligible if it is made on the form 

provided by the commission and contains the information required by the commission. 
(g) A recipient of a grant under this division shall use the grant to pay incremental costs 

of the project for which the grant is made, which may include the reasonable and necessary 

expenses incurred for the labor needed to install emissions-reducing equipment. The recipient 

may not use the grant to pay the recipient's administrative expenses. 

(h) Projects funded with a grant from this program may not be used for credit under any 

state or federal emissions reduction credit averaging, banking, or trading program except as 

provided under Texas Health and Safety Code, 9386.056. 

(i) A proposed project as listed in subsection (a) of this section is not eligible if it is 

required by any state or federal law, rule or regulation, memorandum of agreement, or other 

legally binding document. This subsection does not apply to an otherwise qualified project, 

regardless of the fact that the state implementation plan assumes that the change in equipment, 

vehicles, or operations will occur, if on the date the grant is awarded the change is not required 

by any state or federal law, rule or regulation, memorandum of agreement, or other legally 

binding document or the purchase of an on-road diesel or equipment required only by local law 

or regulation or by corporate or controlling board policy of a public or private entity. 

(j) If a grant recipient fails to meet the terms of a project grant or the conditions of this 

division, the executive director can require that the grant recipient return some or all of the grant 

funding to the extent that emission reductions are not achieved or cannot be demonstrated. 

51 14.646. Monitoring, Recordkeeping, and Reporting Requirements. 

Grant recipients must meet the reporting requirements of their grant, which must occur 

no less frequently than annually. 
$1 14.648. Implementation Schedule. 

This division expires August 31, 2013. 
TEXAS COMMISSIONN ENVIRONMENTAL QALITY 

CO"~&RR~S 

Tm m~ion on Environmental Q&y 

ORDER ADOPTING NEW AND AMENDED RULES AND 

REVISIONS TO THE STATE IRIPLEMENTATION PLAN 

Docket No. 2005-2006-RUL 

On September 20, 2006, the Texas Commission on Environmental Quality (Commission), during a 

public meeting, considered adoption of amendments to 30 TAC Chapter 114, Control of Air Pollution from 

Motor Vehicles, Subchapter K, Mobile Source Incentive Programs, Division 3, Sections 1 14.620, 1 14.622, 

new Section 114.624; and Subchapter K, new Division 4, new Sections 114.640, 114.642, 114.644, 

114.646, and 114.648; and corresponding revisions to the State Implementation Plan (SIP). The 

Commission adopts these amendments to 30 TAC Chapter 114, Control of Air Pollution from Motor 

Vehicles, Subchapter K, Mobile Source Incentive Programs, Division 3, Sections 1 14.620, 1 14.622, new 

Section 1 14.624; and Subchapter K, new Division 4, new Sections 1 14.640, 1 14.642, 1 14.644, 1 14.646, 

and 114.648; and corresponding revisions to the SIP. The adopted rulemaking establishes rules for the 

Texas Clean School Bus Program as directed by House Bill 3469, 79' Legislature. The adopted 

ruleinaking also clarifies cost effectiveness requirements for the Texas Emissions Reduction Plan, 

establishes a rebate grant program as part of the Texas Emissions Reduction Plan, and clarifies scrappage 

requirements for repower and replacement projects under the Texas Emissions Reduction Plan grant 

prograin as provided in House Bill 2481, 7gLh Legislature. Under Texas Health & Safety Code 56 382.01 1, 

382.012, and 382.023, the Cormnission has the authority to control the quality of the state's air and to issue 

orders consistent with the policies and purposes of the Texas Clean Air Act, Chapter 382 of the Tex. Health 

& Safety Code. The proposed rules were published for comment in the April 14, 2006 issue of the Taas 

Register (3 1 TexReg 3 187). 

Pursuant to Tex. Health & Safety Code 5 382.017, Tex. Gov't Code Chapter 2001, and 40 Code of 

Federal Regulations 5 5 1.102 and after proper notice, the Coininission conducted public hearing to consider 

the amendments to 30 TAC Chapter 114, Control of Air Pollution froin Motor Vehicles, Subchapter K, 

Mobile Source Incentive Programs, Division 3, Sections 114.620, 114.622,' new Section 114.624; and 

Subchapter K, new Division 4, new Sections 114.640, 114.642, 114.644, 114.646, and 114.648; and 

corresponding revisions to the State Impleinentation Plan (SIP). Proper notice included prominent 

advertisement in the areas affected at least 30 days prior to the date of the hearing. A public hearing was 

held at the Texas Cominission on Environmental Quality coinplex in Austin, Texas on May 9, 2006. 

The Cominission circulated hearing notices of its intended action to the public, including interested 

persons, the Regional Administrator of the EPA, and all applicable local air pollution control agencies. The 

public was invited to subinit data, views, and recoinmendations on the proposed amendments to 30 TAC 

Chapter 114, Control of Air Pollution froin Motor Vehicles, Subchapter K, Mobile Source Incentive 

Programs, Division 3, Sections 1 14.620, 114.622, new Section 1 14.624; and Subchapter K, new Division 

4, new Sections 114.640, 114.642, 1 14.644, 114.646, and 114.648; and corresponding revisions to the 

4 
SIP, either orally or in writing, at the hearing or during the comment period. Prior to the scheduled 

hearing, copies of the proposed amendments to 30 TAC Chapter 114, Control of Air Pollution from Motor 

Vehicles, Subchapter K, Mobile Source Incentive Programs, Division 3, Sections 114.620, 114.622, new 

Section 1 14.624; and Subchapter K, new Division 4, new Sections 1 14.640, 1 14.642, 114.644, 1 14.646, 

and 114.648; and corresponding revisions to the SIP were available for public inspection at the 

Cormnission's central office and on the Coimnission's Web site. 

Data, views, and recommendations of interested persons regarding the proposed amendments to 30 

TAC Chapter 114, Control of Air Pollution from Motor Vehicles, Subchapter K, Mobile Source Incentive 

Programs, Division 3, Sections 114.620, 114.622, new Section 114.624; and Subchapter K, new Division 

4, new Sections 114.640, 114.642, 1 14.644, 114.646, and 114.648; and corresponding revisions to the SIP 

were submitted to the Commission during the comment period, and were considered by the Coinmission as 

reflected in the analysis of testimony incorporated by reference to this Order. The Commission finds that 

the analysis of testimony includes the naines of all interested groups or associations offering cormnent on 

the proposed amendments to 30 TAC Chapter 114, Control of Air Pollution from Motor Vehicles, 

Subchapter K, Mobile Source Incentive Programs, Division 3, Sections 114.620, 114.622, new Section 

114.624; and Subchapter K, new Division 4, new Sections. 114.640, 114.642, 114.644, 114.646, and 

114.648; and corresponding revisions to the SIP, and their position concerning the same. 

IT IS THEREFORE ORDERED BY THE COMMISSION that the amendments to 30 TAC Chapter 

114, Control of Air Pollution from Motor Vehicles, Subchapter K, Mobile Source Incentive Programs, 

Division 3, Sections 114.620, 114.622, new Section 114.624; and Subchapter K, new Division 4, new 

Sections 1 14.640, 114.642, 114.644, 114.646, and 114.648; and corresponding revisions to the SIP 

incorporated by reference to this Order are hereby adopted. .The Commission further authorizes staff to 

make any non-substantive revisions to the rules necessary to comply with Texas Register requirements. The 

adopted rules and the preamble to the adopted rules and the revisions to the SIP are incorporated by 

reference in this Order as if set forth at length verbatim in this order. 

IT IS FURTHER ORDERED BY THE COMMISSION that on behalf of the Commission, the 

Chairman should transmit a copy of this Order, together with the adopted rules and revisions to the SIP, to 

the Regional Administrator of EPA as a proposed revision to the Texas SIP pursuant to the Federal Clean 

Air Act, 5 110, codified at 42 U.S. Code Ann. $$7410 - 7671q, as amended. 

This Order constitutes the Order of the Cominission required by the Administrative Procedure Act, 

Tex. Gov't Code, $ 2001.033. 

If any portion of this Order is for any reason held to be invalid by a court of competent jurisdiction, 

the invalidity of any portion shall not affect the validity of the remaining portions. 

Date issued: SEP 2 (1 2006 TEXAS COMMISSION ON 

ENVIRONMEmAL QUALITY 
ber printed in bold face type. The insurer may provide an e-mail address or web address printed in bold face type. The notice must be 

attached to, or printed on the reverse side of, a copy of the Insurance 

Code §§1952.301 - 1952.307. The written notice must read as follows: 

Figure: 28 TAC §5.501(h) 

(i) The verbal notice at a minimum must consist of the following: BY LAW, YOU HAVE THE RIGHT TO SELECT WHERE 

YOUR MOTOR VEHICLE IS REPAIRED AND THE PARTS USED 

FOR REPAIRS. HOWEVER, AN INSURANCE COMPANY IS NOT 

REQUlRED TO PAY MORE THAN A REASONABLE AMOUNT 

FOR SUCH REPAIRS AND PARTS. YOUR RIGHTS CONCERNING MOTOR VEHICLE REPAIRS ARE EXPLAINED IN THE 

INSURANCE CODE §§1952.301 - 1952.307, A COPY OF WHICH 

WILL BE MAILED TO YOU WITHIN 15 BUSINESS DAYS. IF 

YOU HAVE ANY QUESTIONS ABOUT YOUR MOTOR VEHICLE REPAIR RIGHTS, CONTACT THE TEXAS DEPARTMENT 

OF INSURANCE AT 1-800-252-3439. 

(i) These amendments are effective April 1, 2007. 

This agency hereby certifies that the adoption has been reviewed 

by legal counsel and found to be a valid exercise of the agency's 

legal authority. 

Filed with the Office of the Secretary of State on September 22, 

2006. 

TRD-200605250 

Gene C. Jarmon 

General Counsel and Chief Clerk 

Texas Department of Insurance 

Effective date: October 12, 2006 

Proposal publication date: June 23, 2006 

For further information, please call: (512) 463-6327 

TITLE 30. ENVIRONMENTAL QUALITY 

PART 1. ' TEXAS COMMISSION ON 

ENVIRONMENTAL QUALITY 

CHAPTER 114. CONTROL OF AIR 

POLLUTION FROM MOTOR VEHICLES 

SUBCHAPTER K. MOBILE SOURCE 

II'JCEI'JTIVE PROGRAMS 

The Texas Commission on Environmental Quality (commission) 

adopts anlendments to 5114.620 and 5114.622. The commission also adopts new 5S114.624, 114.640, 114.642, 114.644, 

114.646, and 114.648. The amendments and new sections are 

adopted without changes to the proposed text as published in 

the April 14,2006, issue of the Texas Register(31 TexReg 31 87) 

and will not be republished. 

The amended 5114.620 and 5114.622 and new 55114.624, 

114.640, 114.642, 114.644, 114.646, and 114.648 are adopted 

to be submitted to the United States Environmental Protection 

Agency (EPA) as revisions to the state implementation plan 

(SIP). 

BACKGROUND AND SUMMARY OF THE FACTUAL BASIS 

FOR THE ADOPTED RULES 

House Bill (HB) 3469, 79th Legislature, 2005, added Chapter 

390 to the Texas Health and Safety Code. This new chapter directs the commission to establish and administer a clean school 

bus program within the financial limits set by amended 5386.051 

and 5386.052 (HB 3469, 79th Legislature). 'This clean school 

bus program will fund efforts by school districts to improve the 

health of children by reducing emissions of diesel exhaust from 

school buses. Reduction of emissions from diesel-powered 

school buses will also benefit the public in ozone nonattainment 

areas by reducing emissions of nitrogen oxides (NOx). 

The commission is adopting new 55114.640, 114.642, 114.644, 

114.646, and 114.648 to establish this program. Under these 

sections, school districts, charter schools, and regional planning 

organizations would be eligible for reimbursement grants for the 

use of emissions reducing catalysts, particulate filters, qualifying 

fuels, and other emissions reducing add-on equipment or technology that the commission finds will reduce emissions. 

House Bill 2481, 79th Legislature, 2005, added 5386.117 to the 

Health and Safety Code to add a rebate grant program under 

the Texas Emissions Reduction Plan (TERP). New 5114.624 

is adopted to implement this program. The rebate grant will 

streamline the grant application process for some applicants 

and will ease the administrative burden on the agency. 

Amendments to 51 14.622 will clarify that for replacement and repower projects, the baseline vehicle, equipment, or engine must 

be scrapped or permanently removed from the State of Texas. 

Amendments to 5114,620 and 5114.622 create an option for the 

commission to use an equivalent measure to the current $1 3,000 

per ton cost effectiveness standard or an alternative approved 

by the commission. These amendments will improve TERP program effectiveness by ensuring that high-emitting engines cannot be reintroduced into an affected county and allowing the commission to increase the emissions reductions created by grants. 

SECTION BY SECTION DISCUSSION 

The commission adopts administrative changes throughout this 

rulemaking to be consistent with guidance provided in the Texas 

Legislative Council Drafting Manual, November 2004, and to 

conform with Texas Register requirements and agency guidelines. 

The adopted amendment to 5114.620 modifies the definition 

of "Cost-effectiveness" to clarify how the cost-effectiveness 

of TERP grant applications will be determined. The adopted 

amendment to 5114.622 clarifies that, for grants entailing replacement or repower of an engine or other equipment, the 

original equipment must be permanently removed from the 

State of Texas. The adopted amendment to 5114.622 also 

clarifies that the commission may establish cost-effectiveness 

standards lower than the statutory $1 3,000 per ton and that the 

commission may also make project selection decisions on a 

variety of factors in addition to costeffectiveness. 

Adopted new 5114.624, Rebate Grant Process, establishes a 

process that awards TERP funds as a rebate. This new process 

would provide for ongoing, first-come, first-served awarding of 

standardized rebates for designated project types. It would create a simple, streamlined process to award TERP funds. 

Amended 5114.620 and 5114.622 and new 5114.624 are also 

adopted to be submitted to the EPA as revisions to the SIP. 

Adopted new 5114.640, Definitions, provides definitions for the 

Texas Clean School Bus Program. This section provides definitions for important terms in the proposed new division. 

ADOPTED RULES October 6,2006 31 ~ex~e~ 8375 
Adopted new 9114.642, Applicability, establishes program eligibility for school districts and charter schools. This section also 

allows regional planning organizations, such as councils of government, and private nonprofit organizations to apply for and receive grants to improve the program. 

Adopted new 5114.644, Clean School Bus Program Requirements, establishes basic program requirements, including: the 

types of projects eligible for a clean school bus grant; the ability of the commission to limit or prioritize funding for the Texas 

Clean School Bus Program; the minimum useful life of a project 

under the grant program; a requirement that replaced equipment 

be permanently removed from the State of Texas; restricting the 

use of grant funds to pay incremental costs associated with the 

project and prohibition against using the grant for administrative 

expenses; prohibition against recipients using grant funding to 

meet federal or state legal requirements and using emissions 

reductions as part of an emissions banking or trading program; 

grant application requirements; and obligation of the grant recipient to return grant funds if they fail to meet the terms of a project 

grant or conditions of the proposed division. 

Adopted new 5114.646, Monitoring, Recordkeeping, and Reporting Requirements, establishes that grant recipients must adhere to the reporting requirements of their grant, which will occur 

no less frequently than annually. 

Adopted new 5114.648, Implementation Schedule, establishes 

that the Texas Clean School Bus program will expire on August 

31, 201 3. 

New 55114.640, 114.642, 114.644, 114.646, and 114.648 are 

also adopted to be submitted to the EPA as revisions to the SIP. 

FINAL REGLILATORY IMPACT ANALYSIS DETERMINATION 

The commission reviewed the rulemaking in light of the regulatory analysis requirements of Texas Government Code, 

52001.0225, and determined that this rule action is not subject 

to 52001.0025 because it does not meet the definition of a 

"major environmental rule" as defined in that statute. A "major 

environmental rule" means a rule the specific intent of which 

is to protect the environment or reduce risks to human health 

from environmental exposure and that may adversely affect in a 

material way the economy, productivity, competition, jobs, the 

environment, or the public health and safety of the state or a 

sector of the state. 

The adopted amendments to Chapter 114 modify the existing 

rules in accordance with House Bill 3469, 79th Legislature, 

which amended Texas Health and Safety Code, 5386.051(b) 

and added Texas Health and Safety Code, Chapter 390 to require the commission to establish a Clean School Bus Program. 

The Clean School Bus Program is intended to reduce diesel exhaust emissions from school buses by funding eligible projects. 

The adopted rule amendments are part of a voluntary incentive 

program with the goal of reducing diesel emissions and as such, 

the adopted rules will not adversely affect in a material way the 

economy, a sector of the economy, productivity, competition, 

jobs, the environment, or the public health and safety of the 

state or a sector of the state. 

Further, the adopted amendments to Chapter 114 modify the existing rules in accordance with House Bill 2481, 79th Legislature, which amended Chapter 386, Subchapter C of the Texas 

Health and Safety Code by adding 5386.117, directing the commission to adopt a process to award grants in the form of rebates 

to streamline the grant application, contracting, reimbursement, 

and reporting processes for certain projects under the TERP. 

These rule amendments will implement procedural changes and 

will have no effect on the environment or human health. These 

rule amendments are part of a voluntary incentive program with 

the goal of reducing diesel emissions and as such, the adopted 

rules will not adversely affect in a material way the economy, a 

sector of the economy, productivity, competition, jobs, the environment, or the public health and safety of the state or a sector 

of the state. 

In addition, a regulatory impact analysis is not required because 

the adopted rules do not meet any of the four applicability criteria 

for requiring a regulatory analysis of a "major environmental rule" 

as defined in the Texas Government Code. Section 2001.0225 

applies only to a major environmental rule the result of which 

is to: 1) exceed a standard set by federal law, unless the rule 

is specifically required by state law; 2) exceed an express requirement of state law, unless the rule is specifically required 

by federal law; 3) exceed a requirement of a delegation agreement or contract between the state and an agency or representative of the federal government to implement a state and federal program; or 4) adopt a rule solely under the general powers 

of the agency instead of under a specific state law. This rulemaking does not exceed a standard set by federal law, and the 

adopted technical requirements are consistent with applicable 

federal standards. In addition, this rulemaking does not exceed 

an express requirement of state law and is not adopted solely 

under the general powers of the agency, but is specifically authorized by the provisions cited in the STATUTORY AUTHORITY section of this preamble. Finally, this rulemaking does not 

exceed a requirement of a delegation agreement or contract to 

implement a state and federal program. 

The commission invited public comment on the draft regulatory 

impact analysis determination during the public comment period 

that ended May 16, 2006. No comments were received on the 

draft regulatory impact analysis. 

TAKINGS IMPACT ASSESSMENT 

The commission evaluated this rulemaking action and performed 

an analysis of whether the adopted rules are subject to Texas 

Government Code, Chapter 2007. The primary purpose of the 

rulemaking is to amend Chapter 114 in accordance with House 

Bill 3469 and House Bill 2481. These amendments implement a 

voluntary program and only affect motor vehicles and equipment 

which are not considered to be private real property. Therefore, 

promulgation and enforcement of these adopted rules are neither a statutory nor a constitutional taking because they do not 

affect private real property. Therefore, these rules do not constitute a taking under Texas Government Code, Chapter 2007. 

CONSISTENCY WITH THE COASTAL MANAGEMENT PROGRAM 

The commission reviewed the adopted rulemaking and found 

that the rulemaking is subject to the Texas Coastal Management Program (CMP) in accordance with the Coastal Coordination Act, Texas Natural Resources Code, 5533.201 et seq., and 

therefore must be consistent with all applicable CMP goals and 

policies. The commission conducted a consistency determination for the adopted rules in accordance with Coastal Coordination Act lmplementation Rules, 31 TAC 5505.22, and found the 

adopted rulemaking is consistent with the applicable CMP goals 

and policies. 

The applicable goal of the CMP is to protect, preserve, restore, 

and enhance the diversity, quality, quantity, functions, and val31 TexReg 83 76 October 6, 2006 Texas Register 
ues of coastal natural resource areas. The specific CMP policy 

applicable to these rules is that commission rules comply with 

40 Code of Federal Regulations (CFR), to protect and enhance 

air quality in coastal natural resource areas (31 TAC S501.32). 

The commission reviewed this adopted rulemaking for consistency with the Texas CMP goals and policies in accordance with 

the regulations of the Coastal Coordination Council and determined that the amendments are consistent with CMP goals and 

policies because this rulemaking action would reduce air pollution from diesel-powered school buses. No new sources of air 

contaminants are authorized and nitrogen oxides and particulate air emissions would be reduced as a result of these rules. 

This adopted rulemaking complies with 40 CFR Part 51. This 

adopted action is part of the control strategy for ozone nonattainment areas in accordance with SIP requirements in 40 CFR 

Part 51 and reduces emissions of particulate matter consistent 

with National Ambient Air Quality Standards set for particulate 

matter in 40 CFR Part 50. 

Promulgation and enforcement of these rules will not violate or 

exceed any standards identified in the applicable CMP goals and 

policies because the adopted rules are consistent with these 

CMP goals and policies, because these rules do not create or 

have a direct or significant adverse effect on any coastal natural resource areas, and because the adopted rules will reduce 

emissions of air pollutants. 

Written comments on the consistency of this rulemaking were 

invited during the public comment period which closed May 16, 

2006. No comments were received on the consistency of this 

rulemaking with the CMP. 

PUBLIC COMMENT 

A public hearing on the adopted rules was held in Austin on May 

9, 2006, at 2:00 p.m. at the Texas Commission on Environmental Quality Complex. The public comment period closed May 16, 

2006. No comments were received at the public hearing, but the 

commission did receive written comments from the Houston Regional Group of the Sierra Club (HSC), Environmental Defense 

(ED), the United States Environmental Protection Agency (EPA), 

the Texas Center for Policy Studies (TCPS), and one individual 

generally supporting the proposed rules. 

RESPONSE TO COMMENTS 

The HSC supports provisions in §114.622(c) and §114.644(e) 

which require grant recipients for replacement or repower 

projects to permanently remove old engines or vehicles from 

Texas. 

The commission appreciates the support. Removing these "old" 

vehicles or engines from use in Texas ensures that they cannot 

continue to pollute the air in Texas. 

The HSC does not support limiting the use of diesel oxidation 

catalysts and particulate filters to certain model years of school 

buses under §114.644(a)(I) and (2), but rather supports the 

widespread use of these pollution control devices. ED comments that these pollution control devices are verified by the 

U.S. EPA or certified by the California Air Resources Board for 

model years beyond those included in the Dr0~0sed rules. ED 

requirements set in the statute (Texas Health and Safety Code, 

5390.002). The commission notes that §114.644(a)(5) allows 

the commission to approve "other technologies that the commission finds will bring about significant emissions reductions." 

This ability would allow the commission to fund a wide variety of 

emission-reducing projects. The commission did not revise the 

proposed rules as a result of this comment. 

The HSC supports reducing the requirement for a project life of 

five years proposed under §114.644(d) to three years of useful 

life. The HSC wants installation of pollution control devices to be 

as widespread as possible as quickly as possible. 

The commission appreciates this comment. The requirement 

for five years of useful life proposed under §114.644(d) reflects statutory requirements (Texas Health and Safety Code, 

§390.004(b)). State law and the proposed rule (§114.644(d)) 

also allow for a pollution control device to be used on a particular 

school bus for a period less than five years if that pollution control device is reinstalled on another school bus for the remainder 

of the required five years. 

One individual comments school buses are used year-round for 

a variety of activities such as class, special eventslfield trips, 

sporting events or other competitions, summer events, and after 

school programs. 

The commission acknowledges this comment. 

One individual comments school buses should be air-conditioned and filtered, similar to classrooms, in order to increase 

learning and protect the health of students, teachers, and other 

staff. The first step in protecting students and teachers from 

exposure to air pollution on school buses would be to require 

that all new school buses be air-conditioned and fitted with 

filters. The second step would be to establish a modification 

program for existing school buses so that standards for existing 

buses could be met as time and budget allow. 

Air-conditioning school buses is outside the scope of this rulemaking. The commission agrees that reducing air pollution from 

school buses would help protect the health of students, teachers, and other staff who work in our school systems. 

The EPA and ED comment that many studies have confirmed 

the detrimental effect of diesel exhaust on children's health and 

that they support the commission's efforts to establish a clean 

school bus program for the State of Texas. 

The commission appreciates the support. 

The EPA comments that there are very few retrofits available 

that provide the substantial NOx reductions for which the TERP 

program was established. It is improbable those retrofits would 

meet the $13,000 per ton cost effectiveness requirements used 

in the TERP program. They comment making the clean school 

bus program a viable part of the TERP program could require 

some modifications to the program. The EPA recommends proposed §114.622(d) be revised to identify what the "additional 

measures" are in addition to, and that the commission provide 

guidance describing such additional measures and how they will 

be considered. 

asks that the commission expand the range' of model years The commission notes while the TERP program and the Clean 

covered by the clean school bus program to match those for School Bus program share a similar method of finance, they are which there are verified technologies. two separate programs. The programs are authorized by sepThe commission appreciates these comments. The model arate chapters of the Texas Health and Safety Code. Furtheryear designations in s114,644(a)(1) and (2), 1994 for oxida- more, Texas statute and the commission's rules do not estabtion catalysts and 1994 to 1998 for particulate filters, reflect lish a specific cost effectiveness requirement for emissions reADOPTED RULES October 6,2006 31 TexReg 8377 
duction projects under the Clean School Bus program. Section 

114.622(d) does not apply to projects under the newly adopted 

Division 4. The commission did not revise the proposed rules as 

requested. 

The EPA recommends the proposed definition of "Qualifying 

fuel" under S114.640 be modified by placing a comma after the 

word "bus" to indicate that the final "that" clause does not apply 

to school buses but instead to the fuel. 

The commission appreciates the EPA's comment. The definition 

included in the rule is the literal definition that was adopted into 

the Texas Health and Safety Code by the 79th Legislature. The 

commission did not revise the proposed rules as suggested. 

The EPA comments additional documentation may be necessary 

if the clean school bus program is submitted as a SIP revision. 

More specifically, the EPA comments the commission should 

provide a demonstration of the adopted rules' consistency with 

Federal Clean Air Act, §110(1). The EPA also comments if the 

clean school bus program is to be approvable into the SIP under 

the Economic lncentive Program, reductions must be surplus, 

quantifiable, enforceable, and permanent. The EPA requests the 

commission confirm that the adopted rule changes are consistent with Federal Clean Air Act, §I 1 O(1) and with its guidance entitled "EPA's Improving Air Quality with Economic Incentive Programs" (Chapters 4 and 8, January 2001). The EPA notes it has 

previously approved the TERP program under these conditions. 

Adopted rules for the Texas Clean School Bus Program are consistent with requirements of the Federal Clean Air Act, §110(1). 

Under the EPA's guidance for economic incentive programs, the 

Texas Clean School Bus Program meets the requirements of a 

financial mechanism economic incentive program. Although the 

Clean School Bus Program derives its funding from the same 

source, the program is separate from the TERP Emissions Reduction Inventive Grant Program. The primary requirements of 

the EPA guidance are: 

Surplus: Underthe Clean School Bus Program an activity will not 

be eligible if it is required by any state or federal law, regulation, 

memorandum of agreement, or other legally binding document. 

The program solicitation documents and grant instructions will 

outline additional restrictions and describe other eligible activities. 

Enforceable: The Clean School Bus program will require a review of each project funded. contracts will require achievement of the emission reductions over the designated project life. 

Emission reductions will be verified through reports on use of 

the grant-funded buses and on-site monitoring and audit visits. 

Contracts will contain provisions that allow the state to recapture 

grant money for the failure to comply with grant obligations. The 

reports. and monitoring activities will be used by TCEQ to track 

compliance and effectiveness of the grant recipients in fulfilling 

their obligations under the contract. The TCEQ may, at any time, 

before or after reimbursement, request additional evidence concerning costs. 

Quantifiable: Emissions reductions achieved through the Texas 

Clean School Bus Program will be quantified using a comparison of baseline NOx and particulate matter emissions with reduced NOx and particulate matter emissions. Engine emissions 

certifications and retrofit system verifications by the EPA will be 

used to verify the emissions of the reduced-emissions engines 

and retrofit systems. Baseline emission rates for uncontrolled 

engines will be based on factors developed and used for SIP 

modeling purposes by the TCEQ. 

The Clean School Bus Program solicitation documents and grant 

instructions will outline the approach for determining incremental costs, emission reductions,and cost-effectiveness. The application forms will require the applicant to provide data on the 

incremental costs of each activity, vehicle or equipment usage 

patterns, and information about the vehicle or equipment needed 

to determine emission rates. Emission factors, load factor, and 

usage pattern information will be used by the TCEQ to calculate emission reductions attributed to an activity. The solicitation 

documents and grant instructions will contain information on how 

to determine the level of NO, and particulate matter emissions 

for the baseline and the new vehicle and equipment. Using this 

information, the TCEQ will determine the emissions reductions 

and cost effectiveness of the project. 

For a project to be eligible for Clean School Bus Program funding, the emission rate of engines or the emission reduction factor 

for retrofit systems must be certified or verified under an applicable EPA certification or verification program. In accordance 

with agreements between the EPA and California Air Resources 

Board (CARB), CARB certification or verification will also be accepted. In some cases, the TCEQ may also accept testing results under EPA, CARB, and/or TCEQ approved test protocols to 

determine the emission rate or emission reduction factor. This 

approach will provide the most flexibility for the program while 

also restricting the evaluation process to those technologies or 

products that can provide documentation that will be acceptable 

to the EPA. 

Permanent: The TCEQ will establish minimum requirements for 

the life of a project, which will be at least five years. The project 

life will be the period in which the grant recipient is contractually obligated to monitor and report on the use of the grantfunded vehicle, equipment, andlor fuel. Environmental benefits 

from projects under the Clean School Bus Program will occur 

for at least this period. Emissions reductions achieved through 

this program are contractually and statutorily permanent for the 

project life established in the grant contract and will be permanently retired. Emissions reductions from the Clean School Bus 

Program will not be usable in an averaging, banking, or trading 

program. 

General Equity Principle and Environmental Justice Principle: 

The Texas Clean School Bus Program is not a banking and trading program so program disbenefik are not expected. BY design, 

this program reduces NO, and particulate matter emissions with 

a concentration on cleaner diesel engines through economic incentives in the form of grants. Eligible projects include (but are 

not necessarily limited to) diesel oxidation catalysts, diesel particulate filters, purchase and use of emission reducing add-on 

equipment, the use of qualifying fuel, and other technologies that 

the commission finds will bring about significant emissions reductions. 

Penalty Provisions: Upon the performing party's failure to comply with the requirements of a Clean School Bus grant, the TCEQ 

may, at its own discretion, require that the performing party return or repay all or a portion of the reimbursement funds. 

Procedures for Public Disclosure of Information and Provisions 

for Addressing Uncertainty. Performing parties will maintain 

project financial information and data used in the preparation or 

support of any request for reimbursement (direct and indirect) 

and copies of any cost information or analysis submitted to 

the TCEQ. The TCEQ, the Texas State Auditor's Office, or 

any of their authorized representatives will have access to all 

such books, records, documents, and other evidence for the 

31 TexReg 83 78 October 6, 2006 Texas Register 
purpose of review, inspection, audit, excerpts, transcriptions, 

andlor copying during normal business hours. Furthermore the 

performing party must agree to the disclosure of all information 

and reports resulting from access to records under the grant. 

Additionally, property records of grant equipment will be maintained that describe the usage, ownership, and any other details 

as outlined in the grant contract. All data and other information 

developed under the grant agreement will be furnished to the 

TCEQ and will be public information except to the extent that it 

is exempted from public access by the Texas Public Information 

Act, Texas Government Code, Chapter 552. 

Safeguards will be established to monitor program funding and 

emission reductions. Applicants of Clean School Bus Program 

funding will be required to monitor the use of grant-funded vehicles, equipment, and fuel and to report to the TCEQ for the life 

of each grant-funded activity. Grant recipients will be required to 

complete the project according to the time frames explained in 

the grant agreement. 

Adopted revisions to the TERP program rules in Division 3 are 

also consistent with Federal Clean Air Act, §I 1 O(1) and are being 

submitted to the EPA as a SIP revision. 'The adopted rules will 

serve to make the program more accessible and more cost-effective; thereby making the program more effective overall. As 

the EPA notes in its comment, the TERP program is already 

approved under federal guidelines for economic incentive programs and the revised rules will continue to meet federal guidance. 

ED generally supports the rule and comments that it is crucial 

to have basic rules in place for the Texas Clean School Bus 

Program so that the commission can proceed quickly to award 

grants when funding becomes available. 

The commission agrees and appreciates ED's support. 

ED and TCPS comment while they generally support the rules 

as proposed, they would like to see the rules refined to "better 

reflect the legislatively-stated goal of improving the 'micro-environment' in and around school buses." 

The commission contends the adopted rules for the Texas Clean 

School Bus Program are consistent with HB 3469. The adopted 

rules develop the basic framework of a clean school bus program. The program will be implemented with a more comprehensive set of guidelines and requirements. 

ED supports new §114.640 and S114.642. ED notes certain 

school districts contract out some or all of their transportation 

services to private companies and suggests that the commission explore ways to ensure buses operated by third parties can 

participate in the Texas Clean School Bus program. 

The commission appreciates ED's support. HB 3469, as enacted, empowers the commission to issue grants only to school 

districts (including countywide school districts), charter schools, 

a regional planning commission (ora similar regional agency created under Texas Government Code, Chapter 391), councils of 

government, and private nonprofit organizations. The commission is not aware of a way to include buses owned by private 

companies in the Texas Clean School Bus Program, but it does 

welcome further ideas from stakeholders as the program is implemented. 

ED and TCPS comment that proposed §114.644(b) is inconsistent with the statutory language of HB 3469 and should be removed. 

The commission contends proposed §114.644(b) is consistent 

with language in HB 3469 which gives the commission the authority to "establish criteria for setting priorities for projects eligible to receive grants under this chapter" (Texas Health and 

Safety Code, §390.004(a)). Setting program priorities will allow 

the commission to ensure that available funds are spent as effectively as possible. 

ED comments the commission should clarify what it means by 

"additional pollutants to be addressed" during a funding period 

(§114.644(c)). ED contends that such language is superfluous 

in light of the specific technologies enumerated in §I 14.644(a). 

In order to spend available funds as effectively as possible, the 

commission wishes to have the ability to prioritize one or more 

pollutants over others if scientific evidence warrants such a priority. 

ED comments the clean school bus program should be made 

as simple as possible for school districts by expressly targeting 

grants to a small number of already verified technologies like 

those in §114.644(a). It believes administrative ease will attract 

participation from smaller school districts. 

The commission appreciates ED's suggestion. 

DIVISION 3. DIESEL EMISSIONS 

REDUCTION INCENTIVE PROGRAM 

FOR ON-ROAD AND NON-ROAD VEHICLES 

30 TAC §§114.620, 114.622, 114.624 

STATUTORY AUTHORITY 

The amendments and new section are adopted under Texas Water Code, S5.102, which provides the commission with the general powers to carry out its duties under the Texas Water Code; 

§5.103, which authorizes the commission to adopt any rules necessary to carry out the powers and duties under the provisions of 

the Texas Water Code and other laws of this state; and 55.105, 

which authorizes the commission by rule to establish and approve all general policy of the commission. The amendments 

and new section are also adopted under Texas Health and Safety 

Code, Texas Clean Air Act, S382.017, which authorizes the commission to adopt rules consistent with the policy and purposes 

of the Texas Clean Air Act; §382.011, which authorizes the commission to establish the level of quality to be maintained in the 

state's air and to control the quality of the state's air; 5382.012, 

which authorizes the commission to prepare and develop a general, comprehensive plan for the control of the state's air; and 

Chapter 386, which establishes the TERP. Finally, the amendments and new section are adopted as part of the implementation of House Bill 2481, 79th Legislature, 2005. 

The adopted amendments and new section implement Texas 

Clean Air Act, SS382.002, 382.011, 382.012, 382.017, 386.051, 

and House Bill 2481, 79th Legislature, 2005. 

This agency hereby certifies that the adoption has been reviewed 

by legal counsel and found to be a valid exercise of the agency's 

legal authority. 

Filed with the Office of the Secretary of State on September 22, 

2006. 

TRD-200605251 

ADC IPTED RULES October 6,2006 31 TexReg 8379 
Robert Martinez 

Director, Environmental Law Division 

Texas Commission on Environmental Quality 

Effective date: October 12, 2006 

Proposal publication date: April 14, 2006 

For further information, please call: (512) 239-0177 

+ + + 

DIVISJON 4. TEXAS CLEAN SCHOOL BUS 

PROGRAM 

30 TAC #114.640, 114.642, 114.644, 114.646, 114.648 

STATUTORY AUTHORITY 

The new sections are adopted under Texas Water Code, 55.102, 

which provides the commission with the general powers to carry 

out its duties under the Texas Water Code; 55.1 03, which authorizes the commission to adopt any rules necessary to carry out 

the powers and duties under the provisions of the Texas Water 

Code and other laws of this state; and S5.105, which authorizes 

the commission by rule to establish and approve all general policy of the commission. The new sections are also adopted under 

Texas Health and Safety Code, Texas Clean Air Act, 5382.017, 

which authorizes the commission to adopt rules consistent with 

the policy and purposes of the Texas Clean Air Act; 5382.011, 

which authorizes the commission to establish the level of quality 

to be maintained in the state's air and to control the quality of the 

state's air; $382.012, which authorizes the commission to prepare and develop a general, comprehensive plan for the control 

of the state's air; Chapter 386, which establishes the TERP; and 

Chapter 390, which establishes the Clean School Bus Program. 

Finally, the new sections are adopted as part of the implementation of House Bill 3469, 79th Legislature, 2005. 

The new sections implement Texas Clean Air Act, 55382.002, 

382.011, 382.012, 382.017, 386.051, and House Bill 3469, 79th 

Legislature, 2005. 

This agency hereby certifies that the adoption has been reviewed 

by legal counsel and found to be a valid exercise of the agency's 

legal authority. 

Filed with the Office of the Secretary of State on September 22, 

2006. 

TRD-200605252 

Robert Martinez 

Director, Environmental Law Division 

Texas Commission on Environmental Quality 

Effective date: October 12, 2006 

Proposal publication date: April 14, 2006 

For further information, please call: (522) 239-0177 

CHAPTER 11 6. CONTROL OF AIR 

POLLUTION BY PERMITS FOR NEW 

CONSTRUCTION OR MODIFJCATJON 

SUBCHAPTER F. STANDARD PERMITS 

30 TAC 5116.603 

The Texas Commission on Environmental Quality (agency 

or commission) adopts an amendment to 5116.603 without 

changes to the proposed text as published in the May 12,2006, 

issue of the Texas Register (31 TexReg 3839), and will not be 

republished. 

The amended section will be submitted to the United States Environmental Protection Agency (EPA) as a revision to the state 

implementation plan. 

BACKGROUND AND SUMMARY OF THE FACTUAL BASIS 

FOR THE ADOPTED RULE 

The commission is adopting a revision to §I 16.603, Public Participation in Issuance of Standard Permits, that will require newspaper notice of proposed standard permits with statewide applicability in Austin, Dallas, Houston, and any other regional newspapers designated by the executive director on a case-by-case 

basis. Also, the executive director will use press releases and 

appropriate electronic means to inform state and local officials. 

Electronic means include, but are not limited to, the use of e-mail 

addresses, Web sites, or electronic bulletin boards and publications. This change will increase notification with state and local 

officials and provide an opportunity for more statewide newspaper coverage through commission press releases. 

Texas Health and Safety Code, 5382.05195(b), requires the 

commission to publish notice of a standard permit in one or 

more statewide or regional newspapers designated by rule 

that will, in the commission's judgement, provide reasonable 

notice throughout the state. The regulation in S116.603 required 

publication in 11 newspapers. Six standard permits have been 

issued under the requirements of 5116.603 and over 80% of 

the comments originated from the Austin, Dallas, and Houston 

areas. The amendment will also save up to $4,500 per standard 

permit notice at a time that an increase in the number of new 

standard permits may be expected. Publishing notice in Austin, 

Dallas, Houston, and any other regional newspapers designated 

by the executive director on a case-by-case basis, along with 

the required Texas Register publication and posting on the 

agency Web site will provide reasonable notice of proposed 

standard permits and will give the commission discretion to 

target the specific areas affected. 

The amendment makes the standard permit public notice more 

consistent with the agency's existing non-individual permit requirements. This includes the Water Quality General Permits, 

which require publication in at least one newspaper of statewide 

or regional circulation. Also, air standard permit amendments 

and revocations, permits by rule, and Title V general operating 

permits with statewide applicability are required to be published 

in newspapers in Austin, Dallas, and Houston. 

SECTION DISCUSSION 

The commission adopts an amendment to §116.603(a). The 

amendment requires newspaper notice of proposed standard 

permits with statewide applicability in Austin, Dallas, Houston, 

and any other regional newspapers designated by the executive 

director on a case-by-case basis. This allows the commission to 

focus its efforts in areas most affected by standard permits. The 

commission will continue to post each draft standard permit on 

its Web site and conduct stakeholder meetings, as appropriate. 

The executive director will issue a press release and will publish 

notice in the Texas Register. The executive director may also 

use appropriate electronic means to notify selected state and 

local officials in the affected area. The rule no longer requires 

newspaper notice for each standard permit proposal in Amarillo, 

31 TexReg 8380 October 6,2006 Texas Register