State of California

AIR RESOURCES BOARD

Notice of Public Availability of Modified Text

PUBLIC HEARING TO CONSIDER AMENDMENTS TO THE CURREN T

REGULATIONS FOR SMALL OFF-ROAD ENGINES

Public Hearing Date: November 21, 2008 Public Availability Date: February 4, 2010 Deadline for Public Comment: February 19, 2010

This notice announces a supplemental period in whic h the public may comment on additional proposed modifications to the regulation for small off-road engines. No action by the public is necessary unless a person w ishes to comment on the additional

modifications.

At its November 21, 2008, public hearing, the Air R esources Board (ARB or Board) approved amendments to the California Code of Regul ations (CCR), title 13, chapter 9, sections 2403, 2405, 2406, 2408, and 2409. The app roved amendments to the regulations include discontinuation of the producti on emission credit program,

modifications to the certification emissions credit program, and the addition of a zero-emission equipment (ZEE) credit program for sm all off-road engines.

At the conclusion of the hearing, the Board adopted Resolution 08-41, in which it approved the originally proposed amendments. Staff responded to the comments made at the hearing in the Final Statements of Reas ons that was submitted to the Office of Administrative Law (OAL) as part of the s ubmittal for final regulatory action approval. The final rulemaking package was submitt ed to OAL on September 8, 2009.

On October 27, 2009, OAL formally disapproved the r ulemaking action regarding the 2008 amendments to the small off-road engine regula tions. The main reasons for OAL’s disapproval was a lack of consistency with pr oposed section 2403(i) and a lack of specificity with ZEE credit program provisions.

Modifications in response to OAL’s disapproval of t he regulatory action, as well as corrected drafting errors in the regulatory text, a re now being made available for a 15 day comment period and are presented below.

By this notice, the modified text is being made ava ilable for comment before resubmittal to OAL for final regulatory action approval. The m odifications are discussed below and set forth in the document appended to this notice a s an Attachment. The Attachment to this notice contains the text of CCR, title 13, cha pter 9, sections 2401, 2403, 2404, 2405, 2406, 2408, and 2408.1 that shows the propose d 15 day modifications to theDate of Release of 45-Day Notice: October 3, 2008 Date of Board Hearing: November 21, 2008 Date of 15-Day Notice: February 4, 2010 – February 19, 2010 2 originally proposed regulatory amendments. Resolut ion 08-41 is available at ARB’s website for this rulemaking: http://www.arb.ca.gov/regact/2008/sore2008/sore2008 .htm

. I. Summary of the Proposed Modifications

A. Substantive Modifications to the Regulatory Text

1. Section 2401. Staff is adding definitions of “eight-hour workday” in order to establish a basis of comparison of ZEE ope ration with that of conventional equipment; “professional level” to establish a basi s of equipment performance comparisons; “standard battery package” to establis h a basis for quantifying battery capacity delivered in a one-hour period; “zero-emis sion equipment credits” to identify emission reductions achievable by ZEE; and, “zero-e mission equipment engine family” to identify specific ZEE that generate credits.

2. Section 2403(i). Staff had proposed to allow the Executive Officer the discretion to make minor technical changes to t he test procedures to provide for

harmonization with the United States Environmental Protection Agency’s regulations that were promulgated after October 3, 2008. Howev er, this creates a process that is inconsistent with Government Code Section 11340.5(a ). For that reason, staff is removing this language from the proposed regulation changes.

3. Sections 2404(m)(1) and (2). Staff is adding an optional ZEE label because staff believes placing professional-l evel ZEE labels may encourage and facilitate environmentally conscious commercial con sumers to purchase ZEE over conventional equipment. Staff has made this label optional because some of the smallsized equipment lack available space due to the oth er labeling requirements.

4. Section 2405(h)(1). Staff is adding a requirement that ZEE, including batteries and battery chargers, be warran ted against defects for at least two

years.

5. Section 2405(h)(2). Staff is adding an allowance for equipment manufacturers to make contractual agreements with b attery manufacturers to provide warranty coverage for the batteries. The equipment manufacturer is ultimately responsible for covering all of the consumer’s warr anty needs.

6. Section 2408(f)(7). Staff removed this section because the provisions for a ZEE credit program were not well d efined. Accordingly, staff introduced a more defined program in section 2408.1.

7. Section 2408.1(a). As with the certification emission credit program, the credit program for ZEE is a voluntary program. Staff is proposing that ZEE may begin to generate ZEE credits with the 2010 model year, and ZEE creditsDate of Release of 45-Day Notice: October 3, 2008 Date of Board Hearing: November 21, 2008 Date of 15-Day Notice: February 4, 2010 – February 19, 2010 3 may be used to offset negative credits from any sma ll off-road engine family beginning with the 2011 model year. However, any equipment t hat receives funding by any emission reduction program funded by ARB (e.g., Ass embly Bill 118 funding), or a manufacturer participating in the Blue Sky program, may not generate ZEE credits. Accordingly, staff is adding language to address th is issue.

8. Section 2408.1(b)(1). Although staff wishes to encourage new technology by providing a ZEE credit program, the p ossibility of manufacturers introducing other equipment that has excessive emis sions is undesirable. To address this concern, staff is adding language which would prevent the usage of ZEE credits to offset excessively “dirty” engines.

9. Section 2408.1(b)(2). Staff is adding an exclusion for any ZEE that is not sold in California from generating ZEE credits. Staff’s intention is to allow credit generation only to equipment that are sold a nd used in California.

10. Section 2408.1(b)(3). Staff is adding an allowance for manufacturers that find it difficult to separate ou t exact sales of an engine family in California, to use their entire production of that engine family when calculating the usage of ZEE credits. This option is only allowed for the usage of credits, and not in the generation of credits.

11. Section 2408.1(b)(4)(A). Staff is adding a requirement that a ZEE may generate ZEE credits when it is certified. Als o, ZEE credits may be used for averaging, banking or trading, or a combination of these three actions.

12. Section 2408.1(b)(4)(B). Staff is adding a durability requirement for ZEE. Staff proposes to set the durability requ irement at the maximum durability period to ensure that only professional-level equip ment can generate ZEE credits. This is meant to encourage new technology that may not y et be in production. The durability periods would be different for each engine displace ment category. The displacement category would correspond to the engine in the conv entional equipment.

13. Section 2408.1(b)(4)(C). In response to comments at the Board hearing, staff proposes to allow a reduced ZEE dura bility requirement with a corresponding reduction in credit generation. A ZE E certified at the lower durability level may generate only seventy-five percent of the ZEE credits that the engine family would have generated at the normal durability perio d. To generate reduced ZEE credits, the engine family must meet a minimum dura bility period of 225 hours for engines with a displacement under 80cc or 375 hours for engines with displacement greater than 80 cubic centimeters (cc) and less tha n 225cc. This provision would be allowed through the 2012 model year.Date of Release of 45-Day Notice: October 3, 2008 Date of Board Hearing: November 21, 2008 Date of 15-Day Notice: February 4, 2010 – February 19, 2010 4

14. Section 2408.1(b)(4)(D). Staff is adding minimum professionallevel requirements. Conventional professional-leve l lawn and garden equipment are generally expected to provide one hour of continuou s use before refueling is required. A similar one-hour operating period expectation wil l apply to professional-level ZEE. However, because current battery technology does no t enable a single battery to power equipment constantly for one hour, staff is allowin g for up to four batteries to be used. If multiple batteries are necessary to meet this re quirement, they must be provided with the equipment. Additional requirements are also in cluded for durability testing and minimum battery durability.

15. Section 2408.1(b)(4)(E). Staff is clarifying the requirement that enough batteries be provided to allow for one hour of continuous operation.

16. Section 2408.1(b)(4)(F). In addition to the required one hour of continuous operation, staff proposes to require man ufacturers to demonstrate that a commercial operator could use the equipment through a typical workday without difficulty. The manufacturer must show that this i s possible with the limitations of the battery charging and recharging times.

17. Section 2408.1(b)(4)(G). Staff is clarifying how manufacturers must comply with the use of ZEE credits.

18. Section 2408.1(b)(4)(H). Staff proposes requirements that would track batteries originally sold with ZEE for credit generation. This requirement would be

useful for both consumers and manufacturers to iden tify which batteries are covered under warranty. This section also clarifies that r eplacement batteries cannot generate

ZEE credits.

19. Section 2408.1(c)(1). Staff proposes that up to fifty percent of the negative emission credits from a particular engine family may be offset by ZEE credits. The remaining credit balance must be offset by posi tive certification credits. Requiring the use of certification emission credits, in addit ion to ZEE credits, encourages

manufacturers to use other advanced emission contro l technologies in addition to the zero emission technology.

20. Section 2408.1(c)(2). To ensure that ZEE credits used to offset emissions from other equipment are legitimate, staf f is requiring that ZEE credits be banked before they can be used.

21. Sections 2408.1(c)(3) and (4). Keeping ZEE credits separated by displacement categories was requested by manufactur ers. Staff also believes that it is beneficial to segregate ZEE credits by displacement because of the differential in the emission standards for each displacement category. In addition, ZEE is expected toDate of Release of 45-Day Notice: October 3, 2008 Date of Board Hearing: November 21, 2008 Date of 15-Day Notice: February 4, 2010 – February 19, 2010 5 replace equivalently performing conventional equipm ent, so the credits should be used only in that displacement category. Accordingly, s taff is adding language that specifies this requirement.

22. Sections 2408.1(d)(1) and (2). Staff is proposing provisions for banking ZEE credits. Specifically, banking of thes e credits may begin in the 2010 model year, and that these credits can be banked on ly at the end of the model year.

23. Sections 2408.1(d)(3) and (4). Staff is proposing that ZEE credit life be limited to five years just as are certifica tion emission credits. After five years, ZEE credits would expire and would no longer be usa ble for offsetting negative

certification emission credits.

24. Section 2408.1(e). Staff is proposing provisions for trading ZEE credits. Specifically, credits that are available for trading are credits that were banked in previous model years, and that these credits exp ire five years from the time they were generated.

25. Section 2408.1(f). This section provides clarifying language for the

calculation of ZEE credits.

26. Section 2408.1(g). Staff is adding the certification requirements for equipment that generate ZEE credits. These req uirements mirror the requirements

for certification emission credits.

27. Section 2408.1(h). Staff is proposing that the maintenance of records requirements for ZEE credits also mirrors t he requirements for certification

emission credits. The records for ZEE credits also include maintaining records for the

batteries, as well.

28. Section 2408.1(i). Staff is proposing that the end-of-year and final reports for ZEE credits be similar to the reports f or certification emission credits.

B. Non-Substantive Modifications to the Regulatory Text

Staff has made other non-substantial modifications throughout the regulation to correct grammatical and typographical errors, correct references and citations, and improve the overall clarity of the d ocument.

1. Section 2403(b)(3). Minor changes to correct references were

made in this section.Date of Release of 45-Day Notice: October 3, 2008 Date of Board Hearing: November 21, 2008 Date of 15-Day Notice: February 4, 2010 – February 19, 2010 6

2. Section 2406(b)(2). Staff is correcting the grammar in the sentence by pluralizing the word “call.” 3. Section 2408(i)(3). The mailing address for the end-of-year and final reports was changed to indicate the correct a ddress.

Comments and Subsequent Action

In accordance with section 11346.8 of the Governmen t Code, the Board directed the Executive Officer to adopt section 95550, title 17, CCR, after making it available to the public for comment for a period of at least 15 days . The Board further provided that the

Executive Officer shall consider such written comme nts as may be submitted during this period, shall make such modifications as may be app ropriate in light of the comments received, and shall present the regulation to the B oard for further consideration if

warranted.

Written comments will only be accepted on the modif ications approved by the Board and may be submitted by postal mail or electronic m ail submittal as follows:

Postal mail: Clerk of the Board, Air Resources Boa rd 1001 I Street, Sacramento, Cali fornia 95814

Electronic submittal: http://www.arb.ca.gov/lispub/comm/bclist.php

Please note that under the California Public Record s Act (Government Code section 6250 et seq.), your written and oral commen ts, attachments, and associated contact information (e.g., your address, phone, ema il, etc.) become part of the public record and can be released to the public upon reque st. Additionally, this information may become available via Google, Yahoo, and any oth er search engines.

In order to be considered by the Executive Officer, comments must be directed to ARB

in one of the two forms described above and receive d by ARB by 5:00 p.m., on the deadline date for public comment listed at the begi nning of this notice. Only comments relating to the above-described modifications to th e text of the regulations shall be considered by the Executive Officer.

If you need this document in an alternate format (i .e., Braille, large print, etc.) or another language, please contact the Clerk of the Board at (916) 322-5594 or by facsimile at (916) 322-3928 no later than five (5) business days from the release date of this notice. TTY/TDD/Speech to Speech users may dial 711 for the California Relay Service.

Si necesita este documento en un formato alterno (p or decir, sistema Braille, o en impresión grande) u otro idioma, por favor llame a la oficina del Secretario del ConsejoDate of Release of 45-Day Notice: October 3, 2008 Date of Board Hearing: November 21, 2008 Date of 15-Day Notice: February 4, 2010 – February 19, 2010 7 de Recursos Atmosféricos al (916) 322-5594 o envíe un fax al (916) 322-3928 no menos de cinco (5) días laborales a partir de la fe cha del lanzamiento de este aviso. Para el Servicio Telefónico de California para Per sonas con Problemas Auditivos, ó de teléfonos TDD pueden marcar al 711.

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