Report on Reductions Achieved from Incentive-Based

Emission Reduction Measures in the San Joaquin Valley 

APPENDIX D: Prop 1B Goods Movement – 2008 Program

Guidelines for Implementation

Release Date: September 22, 2014

Hearing Date: October 23, 2014

California Environmental Protection Agency 

Air Resources Board
PROPOSITION 1B: 

GOODS MOVEMENT 

EMISSION REDUCTION PROGRAM

FINAL 

GUIDELINES FOR IMPLEMENTATION 

Adopted February 28, 2008 

 
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DOCUMENT AVAILABILITY

Electronic copies of this document and related materials can be found at: 

http://www.arb.ca.gov/gmbond. Alternatively, paper copies may be obtained from the 

Board’s Public Information Office, 1001 I Street, 1st Floor, Visitors and Environmental 

Services Center, Sacramento, California, 95814, (916) 322-2990. 

For individuals with sensory disabilities, this document is available in Braille, large print, 

audiocassette or computer disk. Please contact ARB's Disability Coordinator at 

(916) 323-4916 by voice or through the California Relay Services at 711, to place your 

request for disability services. If you are a person with limited English and would like to 

request interpreter services, please contact ARB's Bilingual Manager at 

(916) 323-7053. 

DISCLAIMER

This report has been reviewed by the staff of the Air Resources Board and approved for 

publication. Approval does not signify that the contents necessarily reflect the views 

and policies of the Air Resources Board, nor does mention of trade names or 

commercial products constitute endorsement or recommendation for use. 
ARB CONTACT

Mr. Douglas Ito, Manager 

Goods Movement Strategies Section 

Planning and Technical Support Division 

Air Resources Board 

P.O. Box 2815 

Sacramento, California 95812 

Information Line: (916) 44-GOODS (444-6637) 

Email: gmbond@arb.ca.gov

Website: http://www.arb.ca.gov/gmbond

ARB CONTRIBUTORS

Primary Author: Douglas Ito 

Co-authors: Matthew Botill, Bridget Brown, Nicole Dolney, Jim Fischer, P.E., 

 Chris Halm, Ph.D., Ajay Mangat, Hurshbir Shahi, Luis Woodhouse, Ph.D.

Andy Alexis 

Michael Benjamin, D.Env. 

Tony Brasil 

Joe Calavita 

Grant Chin 

Dan Donohoue 

Judith Friedman 

John Gruszecki, P.E. 

Harold Holmes 

Mike Jaczola 

Kathy Jaw, Ph. D 

Deborah Kerns, Esq. 

Rachel Kirlis 

Leslie Krinsk, Esq. 

Mike Miguel 

Cherie Rainforth 

Todd Sax, D. Env. 

Todd Sterling 

Judy Tanimoto 

Mike Tollstrup 

Floyd Vergara, Esq., P.E. 

Mike Waugh 

Bill Welty 

Erik White 

Lisa Williams 

Todd Wong 

Seungju Yoon, Ph.D. 

Reviewed and Approved by: Cynthia Marvin, Assistant Division Chief, 

 Planning and Technical Support Division 

ACKNOWLEDGMENTS

This proposal would not have been possible without the support of Jack Kitowski, 

Lucina Negrete, Heather Arias, and John Kato of ARB’s Carl Moyer team who so 

generously shared their time to help us launch this new program. 

We would like to recognize the staff of the Bay Area Air Quality Management District, 

the Imperial Air Pollution Control District, the Sacramento Metropolitan Air Quality 

Management District, the San Diego Air Pollution Control District, the San Joaquin 

Valley Air Pollution Control District, and the South Coast Air Quality Management 

District for offering their “on the ground” experiences in running air quality incentive 

programs. 
Table of Contents, page 1 

Table of Contents 

I. Overview ................................................................................................................. 1 

A. Introduction......................................................................................................... 1 

B. Authority.............................................................................................................. 2 

1. Proposition 1B............................................................................................... 2 

2. Senate Bill 88 and Assembly Bill 201 .......................................................... 2 

3. Governor Schwarzenegger’s directives...................................................... 9 

C. Definitions........................................................................................................... 9 

II. ARB Program Administration ............................................................................. 14 

A. Program Guidelines ......................................................................................... 14 

B. Program Funding Targets and Priorities........................................................ 15 

1. Trade corridor funding targets................................................................... 15 

2. Source category funding targets ............................................................... 16 

3. Priorities for FY2007-08 funds ................................................................... 16 

C. Project Specifications and Emissions............................................................ 17 

1. Project specifications for each funding cycle .......................................... 17 

2. Quantifying project benefits....................................................................... 19 

a) Pollutants..................................................................................................... 19 

b) Project benefits calculators.......................................................................... 20 

D. Application Process for Local Agency Projects............................................ 20 

1. Notice of funding availability ..................................................................... 20 

2. Registration of local public entities........................................................... 20 

3. ARB review of applicant and project eligibility ........................................ 21 

a) Completeness ............................................................................................. 21 

b) Qualification as an applicant........................................................................ 22 

c) Consistency with legal and equipment project specifications ...................... 22 

d) Consistency with air quality plans for goods movement .............................. 22 

e) Availability of full funding ............................................................................. 22 

f) Project schedule and milestones................................................................. 22 

g) Data to determine air quality benefits and cost-effectiveness...................... 23 

h) Local agency project implementation demonstration................................... 23 

4. Evaluation of local agency capability to implement the project scope.. 24 

5. Match funding.............................................................................................. 24 

a) Carl Moyer program .................................................................................... 24 

6. Competitive ranking of local agency projects.......................................... 25 

a) Emission reduction score ............................................................................ 25 

b) Cost-effectiveness and match score ........................................................... 26 

c) Competitive ranking..................................................................................... 27 

7. Public workshops on eligible local agency projects ............................... 28 

8. Recommendations for funding local agency projects............................. 28 

a) Consideration of available funds and funding priorities ............................... 28 

b) Funding level for local agency project proposals......................................... 28 

9. Public hearing and Board action ............................................................... 29 

10. Local agency project grant agreement ..................................................... 29 

a) Standard grant agreement provisions ......................................................... 30 
Table of Contents, page 2 

b) General Program provisions........................................................................ 30 

c) Source category-specific elements.............................................................. 31 

11. $25 million in early grants for FY2007-08 funds....................................... 32 

E. ARB Program Oversight .................................................................................. 32 

1. ARB obligations to local agencies ............................................................ 32 

2. ARB expenditures ....................................................................................... 33 

a) Administration funds.................................................................................... 33 

b) Equipment project costs .............................................................................. 34 

3. Earned interest............................................................................................ 35 

4. Ongoing evaluations................................................................................... 35 

a) Ongoing evaluations of local agency projects ............................................. 35 

b) Ongoing evaluations of equipment projects................................................. 36

5. Auditing........................................................................................................ 38 

a) ARB audits of local agency projects ............................................................ 38 

6. ARB reporting.............................................................................................. 41 

a) Public website ............................................................................................. 41 

b) Annual community meetings ....................................................................... 41 

c) Updates to Department of Finance.............................................................. 41 

d) ARB annual report....................................................................................... 42 

7. Local agency non-performance................................................................. 42 

a) Non-performance finding............................................................................. 42 

b) Local agency appeal process...................................................................... 43 

c) Remedies for non-performance................................................................... 43 

III. Local Agency Project....................................................................................... 46 

A. Local Public Entity Registration...................................................................... 46 

B. Local Agency Project Application Packet...................................................... 47 

1. Legal restrictions ........................................................................................ 47 

a) Environmental mitigation ............................................................................. 47 

b) Railroad agreements ................................................................................... 48 

c) Existing ARB regulations............................................................................. 48 

d) Upcoming ARB Regulations........................................................................ 49 

2. Project alternatives for local agencies...................................................... 49 

a) Technology alternatives............................................................................... 50 

b) Project implementation approaches and contractors................................... 51 

c) Procedure/process alternatives................................................................... 52 

d) Geographic operations ................................................................................ 52 

e) Ineligible project alternatives ....................................................................... 54 

3. Completed application................................................................................ 55 

a) General local agency information................................................................ 55 

b) Local agency project proposal..................................................................... 56 

c) Air quality benefits ....................................................................................... 56 

d) Project schedule.......................................................................................... 57 

e) Funding demonstration................................................................................ 57 

f) Staff resources ............................................................................................ 58 

g) Local agency project implementation demonstration................................... 59 

4. Local agency board/commission resolutions .......................................... 60 

C. Local Agency Project Grant Agreement......................................................... 60 
Table of Contents, page 3 

D. Local Agency Project Implementation Requirements................................... 61 

1. Community and public participation ......................................................... 61 

a) Community meetings................................................................................... 61 

b) Public and interested stakeholder participation ........................................... 61 

c) Public website ............................................................................................. 61 

2. Equipment project marketing tools ........................................................... 62 

a) Marketing tools ............................................................................................ 62 

b) Outreach to independent truck owner/operators ......................................... 62 

c) Information on truck efficiency upgrades..................................................... 62 

d) Outreach to small businesses for infrastructure construction ...................... 63 

3. Local agency solicitation of equipment projects ..................................... 64 

4. Review of equipment project applications................................................ 64 

5. Match funding for equipment projects...................................................... 65 

6. Competitive ranking and selection of equipment projects...................... 65 

a) Emission reduction score ............................................................................ 66 

b) Cost-effectiveness and match score ........................................................... 66 

c) Competitive ranking..................................................................................... 67 

d) Application of available funding................................................................... 67 

e) Equipment project backup list...................................................................... 67 

7. Compliance check....................................................................................... 67 

8. Equipment project pre-inspections ........................................................... 68 

9. Notifications to equipment owners ........................................................... 69 

10. Equipment project contracts...................................................................... 69 

a) Standard contract provisions....................................................................... 70 

b) General Program provisions........................................................................ 70 

c) Source category-specific elements.............................................................. 71 

11. Tax reporting ............................................................................................... 72 

12. Provisions for lease-to-own programs...................................................... 72 

13. Equipment project scrap requirements..................................................... 73 

14. Equipment project post-inspections ......................................................... 77 

15. Local agency requests to ARB for grant funds ........................................ 81 

16. Local agency non-performance provisions.............................................. 82 

E. Obligations, Expenditures, and Earned Interest............................................ 82 

1. Local agency obligation of funds to equipment owners ......................... 82 

2. Local agency expenditures on equipment projects................................. 82 

a) Expenditure deadlines for equipment projects............................................. 82 

b) Equipment project purchase restrictions...................................................... 83 

c) Invoice payments (reimbursements) ........................................................... 83 

d) Direct payment to vendor ............................................................................ 84 

3. Earned interest............................................................................................ 84 

a) Calculation of earned interest...................................................................... 84 

b) Reporting requirement for earned interest................................................... 85 

c) Earned interest expenditure provisions ....................................................... 85 

F. Ongoing Local Agency Evaluations of Equipment Projects......................... 86 

G. Local Agency Reporting Requirements ......................................................... 86 

1. Quarterly data updates ............................................................................... 86 

2. Semi-annual report ..................................................................................... 87 

3. Local agency project completion report................................................... 88 
Table of Contents, page 4 

IV. General Equipment Project Requirements..................................................... 90 

A. Ownership Requirements ................................................................................ 90 

B. Third Party Applications .................................................................................. 90 

C. Equipment Project Specifications................................................................... 90 

D. Equipment Project Application Requirements............................................... 90 

1. Equipment project information.................................................................. 90 

2. Equipment project schedule ...................................................................... 91 

3. Case-by-case equipment projects ............................................................. 91 

4. Disclosures.................................................................................................. 91 

5. Equipment project funding demonstration............................................... 92 

6. Equipment owner signature....................................................................... 92 

E. Equipment Project Contract Requirements ................................................... 92 

F. Equipment Sales Requirements...................................................................... 93 

G. Equipment Project Non-Performance............................................................. 93 

APPENDIX A Trucks Serving Ports and Intermodal Rail Yards ............................A-1 

A. Equipment Project Specifications..................................................................A-1 

B. Major Milestones for Equipment Project Completion ..................................A-4 

C. Recordkeeping Requirements........................................................................A-4 

D. Annual Reporting Requirements....................................................................A-4 

E. Ongoing Evaluations and Audits ...................................................................A-4 

F. Application Information ..................................................................................A-5 

1. General contact information .....................................................................A-5 

2. Option (1): retrofit .....................................................................................A-5 

a) Current equipment and activity information ................................................A-5

b) Proposed equipment project information....................................................A-6 

3. Option (2): repower...................................................................................A-6 

a) Current equipment and activity information ................................................A-6

b) Proposed equipment project information....................................................A-7 

4. Option (3): replacement............................................................................A-7 

a) Current equipment and activity information ................................................A-7

b) Proposed equipment project information....................................................A-8 

APPENDIX B Other Heavy Duty Diesel Trucks .......................................................B-1 

A. Equipment Project Specifications..................................................................B-1 

B. Major Milestones for Project Completion......................................................B-5 

C. Recordkeeping Requirements........................................................................B-5 

D. Annual Reporting Requirements....................................................................B-5 

E. Ongoing Evaluations and Audits ...................................................................B-6 

F. Application Information ..................................................................................B-6 

1. General contact information .....................................................................B-6 

2. Option (1): retrofit .....................................................................................B-6 

a) Current equipment and activity information ................................................B-6

b) Proposed equipment project information....................................................B-7 

3. Option (2): repower...................................................................................B-7 

a) Current equipment and activity information ................................................B-7

b) Proposed equipment project information....................................................B-8 
Table of Contents, page 5 

4. Option (3): replacement............................................................................B-8 

a) Current equipment and activity information ................................................B-8

b) Proposed equipment project information....................................................B-9 

5. Option (4): three-way truck transaction ..................................................B-9 

a) TRUCK A: Current equipment and activity information ..............................B-9 

b) TRUCK B: Current equipment and activity information ............................B-10 

c) Proposed equipment project information..................................................B-10 

APPENDIX C Locomotives ...................................................................................... C-1 

A. Equipment Project Specifications................................................................. C-1 

B. Major Milestones for Project Completion..................................................... C-2 

C. Recordkeeping Requirements....................................................................... C-2 

D. Annual Reporting Requirements................................................................... C-3 

E. Ongoing Evaluations and Audits .................................................................. C-3 

F. Application Information ................................................................................. C-3 

1. General contact information .................................................................... C-3 

2. Option (1): switcher locomotive.............................................................. C-4 

a) Current equipment and activity information ............................................... C-4 

b) Proposed equipment project information................................................... C-4 

3. Option (2): line-haul locomotive ............................................................. C-5 

a) Current equipment and activity information ............................................... C-5 

b) Proposed equipment project information................................................... C-6 

APPENDIX D Shore Power ...................................................................................... D-1 

A. Equipment Project Specifications................................................................. D-1 

B. Major Milestones for Project Completion..................................................... D-3 

C. Recordkeeping Requirements....................................................................... D-3 

D. Reporting Requirements................................................................................ D-3 

1. Annual reporting for grid based power................................................... D-3 

2. Annual reporting for non-grid based power (every 1,000 hours).......... D-4 

E. Ongoing Evaluations and Audits .................................................................. D-4 

F. Application Information ................................................................................. D-4 

1. General contact information .................................................................... D-4 

2. Option (1): grid-based shore power ....................................................... D-5 

a) Proposed equipment project information................................................... D-5 

3. Option (2): non-grid shore power ........................................................... D-5 

a) Proposed equipment project information................................................... D-5 

APPENDIX E Commercial Harbor Craft...................................................................E-1 

A. Equipment Project Specifications..................................................................E-1 

B. Major Milestones for Project Completion......................................................E-2 

C. Recordkeeping Requirements........................................................................E-2 

D. Reporting Requirements.................................................................................E-3 

E. Ongoing Evaluations and Audits ...................................................................E-3 

F. Application Information ..................................................................................E-3 

1. General contact information .....................................................................E-3 

2. Options (1) and (2): repowers ..................................................................E-4 

a) Current equipment and activity information ................................................E-4
Table of Contents, page 6 

b) Proposed equipment project information....................................................E-4 

3. Options (1) and (2): replacements ...........................................................E-5 

a) Current equipment and activity information ................................................E-5

b) Proposed equipment project information....................................................E-6 

APPENDIX F Cargo Handling Equipment................................................................F-1 

A. Equipment Project Specifications..................................................................F-1 

B. Major Milestones for Project Completion......................................................F-2 

C. Recordkeeping Requirements........................................................................F-2 

D. Reporting Requirements.................................................................................F-2 

E. Ongoing Evaluations and Audits ...................................................................F-2 

F. Application Information ..................................................................................F-2 

1. General contact information .....................................................................F-3 

2. Option (1): energy storage systems ........................................................F-3 

a) Current equipment and activity information ................................................F-3

b) Proposed equipment project information....................................................F-3 

APPENDIX G Truck Stop/Distribution Center Electrification ............................... G-1 

A. Background..................................................................................................... G-1 

B. Analysis........................................................................................................... G-1 

C. Equipment Project Specifications................................................................. G-2 

D. Major Milestones for Project Completion..................................................... G-3 

E. Recordkeeping Requirements....................................................................... G-3 

F. Reporting Requirements................................................................................ G-3 

G. Ongoing Evaluations and Audits .................................................................. G-4 

H. Application Information ................................................................................. G-4 

1. General contact information .................................................................... G-4 

2. Option (1): electrification infrastructure................................................. G-4 

a) Current equipment and activity information ............................................... G-4 

b) Proposed equipment project information................................................... G-5 

APPENDIX H: Early Grants...................................................................................... H-1
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chapter I: Overview 1 February 2008

I. Overview 

A. Introduction

Emissions from the diesel engines in trucks, locomotives, ships, harbor craft, and cargohandling equipment contribute to local, regional, and global air pollution. The diesel 

pollution from current goods movement operations greatly impacts the health of 

community residents near ports, rail yards, distribution centers, and roads with high 

truck traffic. Diesel emissions are also a major cause of the high regional ozone and 

fine particle levels that harm millions of Californians today. 

Goods movement sources contribute to each trade corridor’s air pollution challenges. 

The Los Angeles/Inland Empire region has the largest concentration of goods 

movement facilities (like ports and rail yards), with high near source health risks and 

high levels of regional ozone and fine particulate (PM2.5) pollution. In the Central 

Valley, the facilities are less concentrated, but there is relatively more through truck and 

rail traffic that contribute to the region’s harmful ozone and PM2.5 levels. In the Bay 

Area, regional ozone and PM2.5 levels are much lower, but truck, port, and rail yard 

activity adjacent to neighborhoods contributes to high localized health risks. In the San 

Diego/Border region, trucks and operations at the port contribute to regional ozone and 

PM2.5 pollution above the State standards. 

Proposition 1B authorizes the Legislature to appropriate $1 billion in bond funding to the 

Air Resources Board (ARB or Board) to quickly reduce air pollution emissions and 

health risk from freight movement along California’s priority trade corridors. The State 

Fiscal Year (FY) 2007-08 budget includes the first installment of $250 million, plus 

implementing legislation via Senate Bill 88 (Chapter 181, Statutes of 2007) that created 

the Goods Movement Emission Reduction Program (Program). Assembly Bill 201 

(Chapter 187, Statutes of 2007) includes a minor clarification. SB 88 requires ARB to 

adopt Program Guidelines to ensure the Program achieves the statutory objectives. 

The implementing statutes direct ARB to maximize the emission reduction benefits and 

achieve the earliest possible health risk reduction in communities heavily impacted by 

goods movement. This Program will supplement regulatory actions and other 

incentives to cut diesel emissions. By statute, the Program can only fund emission 

reductions “not otherwise required by law or regulation.” Key pollutants targeted by the 

Program include diesel particulate matter (diesel PM), an air toxic, and nitrogen oxides 

(NOx) that contribute to formation of both PM2.5 and ozone. The projects funded under 

the Program will also provide co-benefits by reducing greenhouse gas and black carbon 

emissions that contribute to climate change. 

ARB will award grants to fund projects proposed by local agencies that are involved in 

freight movement or air quality improvements associated with goods movement 

activities. Examples of local agencies include air pollution control and air quality 

management districts (air districts), ports, and regional transportation agencies in the 

trade corridors. The local agencies will then be responsible for providing financial 

incentives to owners of equipment used in freight movement to upgrade to cleaner 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chapter I: Overview 2 February 2008

technologies, consistent with Program Guidelines adopted by ARB. Bond funds will 

flow via grants from ARB to local agencies, then to equipment owners via contracts or 

other binding agreements with those local agencies. At both steps, there is competition 

based on the projected emission reductions and reductions per State dollar invested to 

ensure the most beneficial projects are funded. 

ARB staff developed these Proposition 1B: Goods Movement Emission Reduction 

Program Guidelines for Implementation (Guidelines) in consultation with stakeholders, 

including: air districts, metropolitan planning organizations, port authorities, shipping 

lines, railroad companies, trucking companies, harbor craft owners, freight distributors, 

terminal operators, local port community advisory groups, community interest groups, 

and airports. The Guidelines are designed to fund qualifying projects that reduce 

emissions and health risk, incorporate simplicity and efficiency, ensure costeffectiveness, leverage other funding sources, and provide transparency and 

accountability. 

B. Authority

The legal authority for the Program is found in Proposition 1B and the implementing 

statutes discussed below. Governor Schwarzenegger provided additional direction to 

ARB in his Executive Order S-02-07 on bond accountability and his signing statement 

on the budget bill -- Senate Bill 77 (Chapter 171, Statutes of 2007). 

1. Proposition 1B 

In November 2006, California voters approved the Highway Safety, Traffic Reduction, 

Air Quality, and Port Security Bond Act of 2006, also known as Proposition 1B. 

Proposition 1B, among other things, authorizes $1 billion dollars to reduce emissions 

from goods movement in California’s trade corridors. 

“One billion dollars ($1,000,000,000) shall be made available, upon appropriation 

by the Legislature and subject to such conditions and criteria contained in a 

statute enacted by the Legislature, to the State Air Resources Board for emission 

reductions, not otherwise required by law or regulation, from activities related to 

the movement of freight along California's trade corridors. Funds made available 

by this paragraph are intended to supplement existing funds used to finance 

strategies and public benefit projects that reduce emissions and improve air 

quality in trade corridors commencing at the state's airports, seaports, and land 

ports of entry.” (Government Code, Title 2, Division 1, Section 1, Chapter 12.49, 

Article 2, Section 8879.23(c)(2)) 

2. Senate Bill 88 and Assembly Bill 201 

In August 2007, the California Legislature passed and Governor Schwarzenegger 

signed SB 88 and AB 201, which set forth the implementing legislation for the Program 

in Health and Safety (H&S) Code, section 39625 et seq. SB 88 broadly requires ARB to 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chapter I: Overview 3 February 2008

adopt Program Guidelines, establish funding criteria and procedures, and provide 

periodic reports. 

Under SB 88, ARB must adopt Program Guidelines that include, at a minimum, all of the 

following: 

• An application process for the funds, and any limits on administrative costs. 

• Requirements that local agencies identify the useful life of the project and project 

delivery milestones as part of the application process. 

• Criteria for selection of local agency projects and equipment projects. 

• Requirements for match funding. 

• The method by which ARB will consider the air basin’s status in achieving state and 

federal air quality standards. 

• Requirements that grant agreements between ARB and local agencies identify 

project milestones and remedies for failure to meet project milestones. 

• Accountability and auditing requirements, including provisions for audit of project 

expenditures and outcomes. 

SB 88 and AB 201 detail more than 15 factors that ARB is directed to consider when 

allocating funds and selecting local agency projects. Some of these criteria are most 

effectively applied by targeting levels of funding to trade corridors and emission source 

categories, while others lend themselves to selecting among competing local agency 

projects or equipment projects. The steps ARB will take to allocate funding include: 

 

• Identifying funding targets for the overall Program, plus setting funding priorities and 

defining the equipment project options for each appropriation. 

• Competitively ranking and selecting local agency projects for funding in each 

appropriation cycle. 

• Establishing the procedures that local agencies will use to competitively rank and 

select equipment projects for funding. 

Tables 1.1 – 1.3 detail these steps and link each related provision of these Guidelines to 

the statutory requirements in the Health and Safety Code related to funding projects. 

SB 88 also establishes basic reporting requirements for ARB and local agencies (all 

references are to the Health and Safety Code): 

• ARB shall submit an annual report to Legislature summarizing its activities related to 

the administration of this program on January 10 [§39627.5]. 

• The local agency shall complete semiannual reports on progress made toward 

implementation of the project [§39625.02(f)(1)]. 

• The local agency shall submit a final report on project completion within 6 months of 

the project becoming operable [§39625.02(f)(2)]. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chapter I: Overview 4 

Table 1.1 ARB Funding Priorities/Project Options and Statutory Funding Requirements 

ARB Action Guidelines reference Provisions Statutory Requirements [references to Health and Safety Code]

Population relative to other corridors Percent of emissions from goods movement relative to other corridors 

The combination of population and goods movement emissions: conrisk associated with good movement-related emissions and air toxics 

public health benefits of the emission reduction from funded projects 

allocates funds in a manner that gives priority to funding for emission achieve the earliest possible reduction of health risk in communities risks from good movement facilities [§39625.5(b)(1)]; and reflects whe

funded projects are likely to occur in locations with elevated emission[§39625.5(b)(2)(K)].

1. Recommend 

trade corridor funding targets (corridors in §39625.1(e))

Chap II.B.1.

State Implementation Plan (SIP) needs relative to other corridors 

Considers an air basin’s status in maintaining and achieving State anquality standards [§39626(a)(1)(D)], and SIP requirements [§39625.5(

what level of funding should be administered by local agencies in ea

Emissions from each category 

Considers the severity and magnitude of the emission source catego

movement emissions [§39625.5(b)(2)(D)], including greenhouse gas e

[§39625.5(b)(2)(F)]. 

Health impact of category 

Allocates funds in a manner that gives priority to emission reduction earliest possible reduction of health risk in communities with the highgood movement facilities [§39625.5(b)(1)] 

2. Recommend 

source category funding targets (categories in §39625.1(c))

Chap II.B.2.

Funding category Requires competition for funding between local agency projects in six 

represent a single source category or combination of categories (i.e.combined with electrification of truck stops/etc. and shore power is cequipment). Expends funds in a manner that reduces the health risk movement along California’s trade corridors [§39625(d)], maximizes t

benefits [§39625(e)], and provides incentives to control emission sour

increased health risk in the future [§39625(e)]. 

Projects that can be quickly implemented Truck retrofits with diesel PM filters 

3. Recommend 

funding priorities for each appropriation 

Chap II.B.3. Los Angeles/Inland 

Empire port truck replacements 

Allocates funds in a manner that gives priority to projects that achievreduction of health risk in communities with the highest health risks ffacilities [§39625.5(b)(1)]. Retrofitting trucks with diesel PM filters is th

health risk because those retrofits can be accomplished quickly. ComPorts of Los Angeles and Long Beach, and along the drayage truck ryards or distribution centers, have elevated emissions and exposure operations [§39625.5(b)(2)(K)]. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chapter I: Overview 5 

Table 1.1 ARB Funding Priorities/Project Options and Statutory Funding Requirements (cont.) 

ARB Action Guidelines reference Based On Statutory Requirements [references to Health and Safety Code]

Equipment and/or emission level 

Begins with list of projects eligible for funding [§39625.5(a)(2)]. List of 

considers: the ability to reduce criteria and toxic emissions [§39625.5

of the emission reduction [§39625.5(b)(2)(A)], public health benefits of 

[§39625.5(b)(2)(B)], existing (and pending) regulatory requirements [§3

advanced emission reduction technologies [§39625.5(b)(2)(G)] where 

available, and reduction in greenhouse gas emissions [§39625.5(b)(2)

specifications for equipment upgrades. For locomotives, establishes Class I railroads that have signed agreements with public agencies tthat the emission reductions from any locomotive projects for these rnecessary to satisfy any mandated reduction requirement under any 

[§39625.5(a)(2)(B)]. Specifically prohibits funding for idle reduction de

2005 MOU and requires railroads to submit a compliance plan for the seeking funding for locomotives that operate in the South Coast Air B

Funding caps/match funding 

Requires a specified contribution of funds leveraged from other sourccontributions to the project [§396269(a)(1)(B)], considers the cost-effe

[§39625.5(b)(2)(C)] and helps leverage other funds [§39625.5(b)(2)(H)] v

funds that can be requested for each equipment project option. Statamount to roughly 1/3 to 1/2 of total project cost, with the remainder public matching funds. 

Project life Considers sustainability of the reduction via minimum project life exp

operation or activity levels for upgraded equipment [§39625.5(b)(2)(C)

of reductions over project lifetime per State dollar invested [§39625.5(

Project completion prior to regulatory requirement(s) 

Considers the degree of surplus reductions [§39625.5(b)(2)(E)] and en

achieve reductions not otherwise required by law or regulation [§3962

requirements that equipment upgrades be operational a specified timany regulatory requirement for such upgrade. 

4. List eligible 

equipment project options and project specifications for each appropriation (project types identified in 

§39625.5(a)(2)) 

Chap II.C.1. and Appendices A-G

Conditions on future operations 

Considers whether reductions are likely to occur in area with elevateexposure [§39625.5(b)(2)(K)]via requirements for 100% California ope

visitation frequency for trucks serving ports and intermodal rail yards
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chapter I: Overview 6 

Table 1.2 Selection Process for Local Agency Projects and Statutory Funding Requirements 

ARB Action Guidelines reference Based On Statutory Requirements [references to Health and Safety Code]1. Issue notice of 

funding availability 

Chap II.D.1. 

Registration, application submittal and schedule, and requirement for community meeting 

Starts local agency application process [§39626(b)]. Requires local a

concepts for local agency projects, and solicit and consider communfor Program funding – this helps ensure that local agency project proearliest possible reduction of health risk in communities with the highmovement [§39625.5(b)(1)].

2. Review local 

agency eligibility 

Chap II.D.2. and II.D.3.b. 

Basic qualification Meets statutory definition of an applicant as a local public entity invol

or air quality improvements associated with goods movement [§3962

requirements of these Guidelines. 

Completeness Ensures presence of complete application and signed board/commis

evaluate statutory requirements described below. 

Consistent with legal and project specifications 

Ensures local agency project achieves emission reductions not other

regulation [§39625.5(a)(1)] and complies with all eligible equipment pr

equipment project specifications that encompass multiple statutory re

Sponsored by an applicant and consistent with air quality plans 

Local agency project is sponsored by an applicant as evidenced by p

[§39626.5(a)(1)] and project is consistent with any comprehensive loca

strategies to reduce emissions from goods movement [§39626.5(a)(2)

Availability of full funding 

Requires project funding element to demonstrate that the funds are ereasonably available and sufficient to complete the project [§39625.02

Project schedule/milestones 

Requires project nominations (applications) to have project delivery m

[§39625.02(e)(3)]. 

3. Review local 

agency project eligibility 

Chap II.D.3. 

Data for competitive ranking process 

Requires project nominations (applications) to identify the useful life [§39625.02(e)(2)], as well as provide data on the emission reductions, 

Program and match funds (other State, local, federal, and private) to ranking in Action 7 below. 

4. Post eligible 

projects on website 

Chap II.D.3. 

Public access Makes available preliminary list of projects being considered for fund

comment [§39626(c)(1)]. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chapter I: Overview 7 

Table 1.2 Selection Process for Local Agency Projects and Statutory Funding Requirements (co

ARB Action Guidelines reference Based On Statutory Requirements [references to Health and Safety Code]5. Evaluate local 

agency capability to implement project scope 

Chap II.D.4. 

Resources to implement project scope within allowed time 

Considers local agency’s ability to deliver equipment projects and em

achieve the earliest possible health risk reduction [§39625(e)] and [§3

6. Require match 

funding 

Chap II.D.5. and Appendices A-G 

Identify sources of match funding 

Ensures that State bond funds are supplemented and matched with and private sources to the maximum extent feasible [§39625.5(c) and 

Emission reduction score 

Requires projects to compete within a source category based on gre

[§39625.5(a)(1)] and magnitude of the emission reduction [§39625.5(b)

health benefits of the reductions by weighting combustion PM (i.e,. d20 relative to criteria pollutant NOx to reflect the greater health impacemissions [§39625.5(b)(2)(B)], sustainability of the reductions via proje

and ability to reduce criteria and toxic pollutants by considering NOx [§39625.5(b)(2)(I)]. 

Cost-effectiveness and match score 

Considers cost-effectiveness of the reductions [§39625.5(b)(2)(C)] and 

from other sources [§39625.5(b)(2)(H)] by assessing total reductions o

State dollar invested [§39625.5(b)(2)(J)].

7. Competitively 

rank local agency projects 

Chap II.D.6. 

Competitive ranking Equally weights the above scores. 

8. Hold workshops Chap II.D.7. 

Public input Requires ARB staff to hold public workshops in northern, central, and 

discuss the preliminary list of local agency projects being considered 

Competitive ranking Allocates funds on a competitive basis for projects that achieve grea

from each source category [§39625.5(a)(1)]. 

9. Recommend 

project funding 

Chap II.D.8. Available funds and 

funding priorities 

Limits selection or “programming” of local agency projects to funds aLegislature [§39626(d)]. 

10. Hold hearing to 

adopt project list 

Chap II.D.9. 

Public hearing and Board adoption of local agency projects 

Requires consideration of projects at a regularly scheduled public he

Requires adoption of a final list of projects for funding [§39626(c)(3)]. 

11. Execute local 

agency grant agreements 

Chap II.D.10. 

ARB and local agency to sign 

Implement grant funding via legal agreements between ARB and rec[§39625.3]. Ensures statutory and Guideline requirements for local a
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chapter I: Overview 8 

Table 1.3 Selection Process for Equipment Projects and Statutory Funding Requirements 

Local Agency 

Action Guidelines reference

Based On Statutory Requirements [references to Health and Safety Co

1. Solicit equipment 

project applications 

Chap III.D.2. and III.D.3. 

Marketing/outreach and application elements including data for competitive ranking process 

Requires project nominations (applications) to identify the use[§39625.02(e)(2)], as well as provide data on the emission redu

Program and match funds (other State, local, federal, and privcompetitive ranking in Action 3 below. Also requires local ageefficiency upgrades to reduce greenhouse gases [§39625.5(b)(

infrastructure projects, requires local agencies to encourage thbusinesses in the construction of the State’s infrastructure [Go

14838.1]. 

2. Require match 

funding 

Chap III.D.5. and Appendices A-G 

Identify sources of match funding 

Ensures that State bond funds are supplemented and matchefederal, local, and private sources to the maximum extent feas

§39625.5(b)(2)(H)]. 

Emission reduction score Requires equipment projects to compete within a source categ

based on greatest emission reductions [§39625.5(a)(1)] and ma

reduction [§39625.5(b)(2)(A)]. Also considers: public health beby weighting combustion PM (i.e,. diesel PM) by a factor of 20 pollutant NOx to reflect the greater health impact of each ton o[§39625.5(b)(2)(B)], sustainability of the reductions via project li

and ability to reduce criteria and toxic pollutants by considerin[§39625.5(b)(2)(I)]. 

Cost-effectiveness and match score 

Considers cost-effectiveness of the reductions [§39625.5(b)(2)(

leverage funds from other sources [§39625.5(b)(2)(H)] by asses

over project lifetime per State dollar invested [§39625.5(b)(2)(J)

3. Competitively 

rank equipment projects (each vehicle or piece of equipment competes separately) 

Chap III.D.6. 

Competitive ranking Equal weighting of the above scores. 

4. Post ranked 

projects 

Chap III.D.6. 

Public access Provides public access to competitively ranked projects propo

signature of contracts with equipment owners [consistent with ARB to do the same in §39626(c)(1)]. 

5. Execute 

equipment project contracts 

Chap III.D.10. 

Local agency and equipment owner (and any lessee) to sign 

Ensures statutory and Guideline requirements for equipment p
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap I: Overview 9 February 2008

3. Governor Schwarzenegger’s directives 

In January 2007, Governor Schwarzenegger issued Executive Order S-02-07 

highlighting the importance of transparency and accountability in administering the over 

$40 billion in bond funding approved by voters in 2006. The Executive Order directs all 

State government entities responsible for expending bond proceeds to establish and 

document a three part accountability structure that includes: 

• Front-end accountability, which defines the criteria for expending bond funds as well 

as the outcomes that the funds are intended to achieve. 

• In-progress accountability, which documents actions to ensure projects are staying 

within scope and cost, and requires semi-annual reports to Department of Finance. 

• Follow-up accountability, which requires audits to ensure expenditures achieved the 

intended outcomes and were consistent with legal requirements. 

The Governor’s signing message on the FY2007-08 budget via SB 77 also: 

• Calls on ARB to move quickly -- without sacrificing accountability -- to provide relief 

for the individuals who reside along California’s busy trade corridors. 

• Directs ARB to ensure funding is allocated consistent with the accountability 

safeguards in the Executive Order. 

• Charges ARB to develop Program Guidelines that make sense, reduce bureaucratic 

red tape, simplify and expedite project application and award procedures, and 

ensure projects are completed in record time. 

• Calls on local agencies to work closely with ARB to be prepared to submit 

applications for funding as soon as possible. 

C. Definitions

The following definitions apply for the purposes of these Guidelines. 

Table 1.4 Definitions 

Term Definition 

Administrative 

Agency 

“Administrative agency” (henceforth ARB) is defined by SB 88 to be the Air 

Resources Board as the state agency responsible for programming Program 

funds. 

Administration 

Funds 

“Administration funds” are defined as the monies available up to the limits 

defined these Guidelines to cover expenses incurred for implementation of the 

Program by ARB or a local agency that is party to an executed grant agreement. 

Allocation “Allocation” is defined as the Board action to award grant funds to local agencies 

as documented in a Board resolution. 

Applicant “Applicant” is defined by SB 88 to mean a “local public entity involved in the 

movement of freight through trade corridors of the state or involved in air quality 

improvements associated with goods movement.” These Guidelines clarify how 

ARB will assess a local public entity’s eligibility as a Program applicant. Also 

referred to as an applicant local agency. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap I: Overview 10 February 2008

Term Definition 

Appropriation “Appropriation” means an authorization by the Legislature in the annual Budget 

Act to make funds available from the California Ports Infrastructure, Security, 

and Air Quality Improvement Account Highway Safety, Traffic Reduction, Air 

Quality and Port Security Fund of 2006 to ARB for the purpose of implementing 

SB 88 and AB 201. 

ARB or Board “ARB” or “Board” means the California Air Resources Board. The term “Board” 

is specifically used to refer to the governing board of the agency and is typically 

associated with formal actions to adopt guidelines or projects for funding. 

Authorized 

Local Agency 

Representative 

“Authorized local agency representative” means the individual(s) from the local 

agency who are authorized to sign or act on behalf of the local agency. 

Baseline 

Emissions 

“Baseline emissions” are defined as the emissions level of a diesel engine, 

except interstate line-haul locomotives, using CARB diesel fuel prior to any 

equipment upgrades funded by this Program. 

Contract “Contract” means the legally binding agreement between a local agency and 

equipment owner. 

(Also referred to as an Equipment Project Contract)

Contract Term “Contract Term” means the combined time period for: 

1) equipment project completion; and 

2) the equipment project life. 

(Also referred to as an Equipment Project Contract Term) 

Cost 

Effectiveness 

“Cost Effectiveness” means the total pollutant-weighted emission reductions over 

the project life, per dollar of State funding invested. 

Diesel 

Particulate 

Matter (diesel 

PM) 

“Diesel Particulate Matter (Diesel PM)" means the particles found in the exhaust 

of diesel engines, which may agglomerate and adsorb other species to form 

structures of complex physical and chemical properties. 

Diesel PM is a subset of fine particulate matter 2.5 microns or less in diameter 

(PM2.5). 

Earned Interest “Earned interest” means accrued interest from Program funds being held by the 

local agency in interest-bearing accounts. 

Equipment 

Owner 

“Equipment owner” means the legal owner of Program-eligible equipment, 

except that for grid-based shore power, the term “equipment owner” shall 

encompass any party with the authority to co-fund, implement, and operate 

improvements resulting in provision of grid-based shore power, which may 

include, but not be limited to the port, a marine terminal operator, and shipping 

companies. 

Equipment 

Project 

“Equipment project” means an upgrade of existing equipment via retrofit, 

repower, or replacement, or installation of electrical infrastructure according to 

Program requirements. Each individual truck, locomotive, piece of cargo 

equipment, harbor craft, or ship berth proposed for upgrade is considered a 

separate equipment project. 

Equipment 

Project 

Alternative 

“Equipment project alternative” means one or more choices that the local agency 

may propose to customize the local agency project proposal in its application. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap I: Overview 11 February 2008

Term Definition 

Equipment 

Project 

Completion 

“Equipment project completion” means the date the local agency determines that 

all equipment project requirements are completed with the exception of ongoing 

maintenance, operation, and annual reporting requirements for the new 

equipment. For each equipment project, this includes the liquidation of Program 

funds and successful post-inspection (including scrappage, if required). 

Equipment 

Project Cost 

“Equipment project cost” means the total cost of the equipment project, including 

State and non-State funding, but excluding administration funds. 

Equipment 

Project Life 

“Equipment project life” for each project option in these Guidelines means the 

length of time an equipment owner is obligated (under an equipment project 

contract) to maintain and operate the bond-funded equipment according to the 

requirements of the Program.

Equipment 

Project Option 

“Equipment project option” means the specific mechanism to retrofit, repower, or 

replace a diesel engine or provide an alternative power source to reduce 

emissions of diesel PM and/or NOx. A source category may include multiple 

equipment project options (e.g., truck retrofit, repower, and replacement are 

each distinct project options as defined in these Guidelines). 

Expenditure “ARB expenditure” means ARB’s payment of Program funds to a local agency. 

“Local agency expenditure” means a local agency’s payment of Program funds 

to an equipment owner. 

Funding 

Category 

“Funding category” means the source category or combination of source 

categories for purposes of establishing funding targets. 

For example, the shore power and cargo equipment source categories are 

combined into a single funding category with a recommended funding target. 

Goods “Goods” are defined as having the same meaning in Commercial Code section 

2105. 

Guidelines “Guidelines” means the Proposition 1B: Goods Movement Emission Reduction 

Program - Guidelines for Implementation.

Grant “Grant” (also referred to as “grant funds” and “grant award”) means the Program 

funding allocated by ARB to a local agency under a Local Agency Project Grant 

Agreement. 

Grant 

Agreement 

“Grant agreement” means the legally binding agreement between ARB and a 

local agency. 

(Also referred to as a Local Agency Project Grant Agreement) 

Grant 

Agreement 

Term 

“Grant Agreement Term” means the time period identified in a local agency 

project grant agreement within which a local agency is legally bound to fully 

implement the local agency project. 

Independent 

Owner Operator 

“Independent Owner Operator” means a person who both owns a single heavyduty diesel truck and personally operates that truck to haul goods. 

Liquidation “ARB liquidation” means the full expenditure of all Program funds identified in an 

executed local agency project grant agreement. 

“Local agency liquidation” means the full expenditure of all Program funds 

identified in an executed equipment project contract. 

Local Agency “Local agency” means an eligible applicant or recipient of Program funds from 

ARB. A local agency that is administering Program funds under an executed 

grant agreement is also referred to as a recipient agency in SB 88. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap I: Overview 12 February 2008

Term Definition 

Local Agency 

Board/ 

Commission 

“Local agency board/commission” means the popularly elected or appointed 

governing body of a local public entity. 

Local Agency 

Project 

“Local agency project” means the source category-specific incentive program 

that the local agency proposes to implement with Program funding. The local 

agency project may include one or more equipment project options within the 

same source category. 

Local Agency 

Project 

Implementation 

Approach 

“Local agency project implementation approach” means the mechanism(s) a 

local agency may propose to implement one or more equipment project options. 

For example, as part of a single local agency project, a port may propose to 

employ three contractors to run truck replacement programs – one focused on a 

lease-to-own program for diesel trucks, one on leasing natural gas trucks, and 

one on offering grants to truck owners for purchase of new trucks. Each of these 

are implementation approaches. 

Local Public 

Entity 

A “local public entity” means a county, city, district, public authority created by 

statute, public agency, and any other political subdivision in the State. Local 

public entities do not include states or the federal government. 

Match funding “Match funding” means the non-Program funds used in conjunction with Program 

funds to fully fund proposed local agency and equipment projects. These may 

include monies from private, local, other State, and federal sources, except as 

otherwise provided under these Guidelines or local, State, and federal law. 

Model Year 

2007 Truck 

Emission 

Levels 

“Model year 2007 truck emissions levels” are defined as emissions of 1.2 grams 

per brake horsepower-hour (g/bhp-hr) or less of NOx, and 0.01 g/bhp-hr or less 

of PM, as certified by the U.S. Environmental Protection Agency (U.S. EPA) or 

ARB. 

NonPerformance “Non-Performance” means the act of not completing one or more components of 

an executed local agency project grant agreement or equipment project contract. 

Not Otherwise 

Required by 

Law or 

Regulation 

"Not otherwise required by law or regulation" means the emission reductions are 

not required pursuant to any local, State, or federal law, rule, or regulation; any 

requirements imposed by the California Environmental Quality Act (CEQA); or 

any requirements imposed by a legal instrument such as a legal settlement or 

consent decree (collectively referred to as "law or regulation"). 

For purposes of this Program only, "not otherwise required by law or regulation" 

does not apply to any tariff, ordinance, or other requirement imposed by a local 

agency based on that agency's authority as a market participant or municipal 

proprietor or the agency's authority to enter into contracts with equipment owners 

and operators. 

Notice of 

Funding 

Availability 

“Notice of Funding Availability” is defined by statute as ARB’s public 

announcement to begin solicitation of local agency project applications. 

Obligation “ARB obligation” means the execution of a local agency project grant agreement 

between ARB and a local agency. 

“Local agency obligation” means the execution of an equipment project contract 

between a local agency and equipment owner. 

(Obligation is also commonly referred to as “encumbrance”) 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap I: Overview 13 February 2008

Term Definition 

Program “Program” means the Goods Movement Emission Reduction Program, except as 

otherwise noted. 

Recipient 

Agency 

“Recipient agency” means the local agency that receives Program funds under 

an executed grant agreement. 

Replacement “Replacement” means the act of replacing a higher-emitting diesel vehicle, piece 

of diesel equipment, or diesel harbor craft with a lower-emitting vehicle, piece of 

equipment, or craft (i.e., replacement of an old truck with a new one). 

Repower “Repower” means the act of replacing a higher-emitting diesel engine with a new 

or remanufactured, lower-emitting engine in the same vehicle, piece of 

equipment, or harbor craft. 

Retrofit “Retrofit” means the act of adding emission control technology or modifying an 

engine on an existing diesel vehicle, piece of diesel equipment, or diesel harbor 

craft. The project specifications may require that this technology be an ARB 

Verified Diesel Emission Control Strategy. 

State 

Implementation 

Plan 

“State Implementation Plan” or SIP means the air quality plan adopted by ARB 

and local air districts (as applicable) that demonstrates how each region will 

attain or maintain national ambient air quality standards, as required by the 

federal Clean Air Act section 110. 

Source 

Category 

“Source Category” means a discrete category of emission sources specific to 

this Program. A source category may contain multiple equipment project 

options. Under this Program, source categories include: trucks serving ports and 

intermodal rail yards, other trucks, truck stop/distribution center electrification, 

locomotives, shore power for ships, cargo handling equipment at ports and 

intermodal rail yards, and commercial harbor craft. To establish funding targets 

and promote appropriate competition between projects, ARB may combine 

multiple source categories within a “funding category.” 

Trade Corridor “Trade corridor” means any one of the four following regions in California: 

Bay Area, consisting of: 

 San Francisco Bay Area Air Basin (CCR Title 17 §60101) 

Central Valley, consisting of: 

 San Joaquin Valley Air Basin (CCR Title 17 §60107) 

 Sacramento Metropolitan Federal Ozone Nonattainment Area 

 (40 CFR Part 81 §81.305, p.23886-23887, Apr 30, 2004) 

Los Angeles/Inland Empire, consisting of: 

 South Coast Air Basin (CCR Title 17 §60104) 

 Port Hueneme in Ventura County 

San Diego/Border Region, consisting of: 

 San Diego County (Government Code §23137) 

 Imperial County (Government Code §23113)

Verified Diesel 

Emission 

Control 

Strategy 

“Verified Diesel Emission Control Strategy (VDECS)” means an emission control 

strategy, designed primarily for the reduction of diesel PM emissions, which has 

been verified pursuant to the “Verification Procedure for In-Use Strategies to 

Control Emissions from Diesel Engines” in title 13, California Code of 

Regulations, commencing with section 2700. 

(Note: ARB has separate procedures to verify control devices for stationary 

sources.) 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap II: ARB Program Administration 14 February 2008

II. ARB Program Administration 

This chapter identifies the proposed requirements for ARB to administer the Program. 

SB 88 requires that the Board hold public hearings, adopt Program Guidelines, and 

adopt a final list of local agency projects that will receive funding from each 

appropriation. ARB staff shall implement the Board’s direction as defined in Board 

resolutions, the Program Guidelines, and the list of local agency projects to be funded. 

ARB staff’s duties to administer the Program shall include, but are not limited to: 

developing the proposed Guidelines and project specifications; issuing the Notice of 

Funding Availability; soliciting, reviewing and recommending local agency projects for 

funding; executing and implementing grant agreements with local agencies; auditing 

local agency projects; tracking and reporting on progress in expending funds and 

achieving performance milestones; developing and maintaining a public website on the 

Program; and conducting workshops and other forms of outreach to seek public input 

on Program design and implementation. 

A. Program Guidelines 

As required by SB 88, ARB shall develop and adopt initial Program Guidelines in a 

public process. The Guidelines shall include, at a minimum, all of the following: 

• An application process for the funds, and any limits on administrative costs. 

• Requirements that local agencies identify the useful life of the project and project 

delivery milestones as part of the application process. 

• Criteria for selection of local agency projects and equipment projects. 

• Requirements for match funding. 

• The method by which ARB will consider the air basin’s status in achieving state and 

federal air quality standards. 

• Requirements that grant agreements between ARB and local agencies identify 

project milestones and remedies for failure to meet project milestones. 

• Accountability and auditing requirements, including provisions for audit of project 

expenditures and outcomes. 

Following each appropriation of Program funds to ARB, staff shall develop and the 

Board will consider adoption of any appropriate updates to these Program Guidelines 

prior to issuing the Notice of Funding Availability for that funding cycle. Staff shall 

evaluate the progress of the Program and any changes needed to improve its 

effectiveness, plus advances in technology and updated equipment costs that create a 

need to revise the list of equipment project options. ARB staff shall provide adequate 

opportunity for public input, including release of any proposed updates to the Guidelines 

for public review prior to Board consideration at a noticed public hearing. 

The Guidelines are designed and intended to effectuate the provisions of SB 88 and AB 

201. However, in the event a provision of the Guidelines conflicts with either SB 88 or 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap II: ARB Program Administration 15 February 2008

AB 201, or any other statute enacted to implement Proposition 1B, the relevant statutory 

provisions shall control. 

B. Program Funding Targets and Priorities 

ARB staff shall propose and the Board may approve funding targets for each trade 

corridor and each source category or groups of categories (referred to as a funding 

category) to provide overall direction on the Program and guide each trade corridor in 

the development of viable project proposals. Such targets can ensure that all of the 

statutory criteria are effectively implemented in a straightforward and transparent 

manner. Any such targets shall not commit the Board to specific allocations in future 

years and shall not be considered a programming of funds to specific local agency 

projects. Funding for local agency projects in each individual funding cycle shall be 

responsive to priorities established by the Board and may not be directly proportional to 

the targets. ARB staff shall recommend funding levels for local agency projects that are 

designed to reach the targets over the course of the entire $1 billion Program. 

1. Trade corridor funding targets 

While SB 88 does not explicitly require an allocation by corridor, it does direct ARB to 

identify a means to consider an air basin’s attainment status for state and federal air 

quality standards and its health risk from goods movement. ARB staff believes this is 

most efficiently and effectively done by targeting funding to each corridor based on 

population, goods movement emissions, and federal attainment needs. These targets 

also ensure that California residents in each defined trade corridor see benefits from the 

Program. Finally, such targets facilitate a transparent and open discussion of the 

optimum funding splits to reduce the contribution of goods movement sources to each 

region’s toughest air pollution challenges. The Staff Report describes the basis for the 

proposed targets. 

The proposed funding targets for each trade corridor, including all state and local 

Program administration funds, are: 

Dollars Trade Corridor

• $550 million: Los Angeles/Inland Empire trade corridor 

• $250 million: Central Valley trade corridor 

• $140 million: Bay Area trade corridor 

• $ 60 million: San Diego/Border trade corridor 

Since this Program looks at the trade corridors as part of a single goods movement 

system for California, local agencies administering bond monies shall be required to 

fund projects based on the total emission reductions expected in the State (not just their 

local area). The majority of the travel or operation must be in one or more of the trade 

corridors. Regions like the San Joaquin Valley with high through-truck and rail traffic 

will benefit from projects administered by agencies in other corridors. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap II: ARB Program Administration 16 February 2008

The funding for trucks serving ports and intermodal rail yards (allocated to the corridors 

where those facilities are located) will be available for all California trucks focused on 

that service, regardless of their home base. Thus, cleanup funds allocated to the Bay 

Area for the Port of Oakland may go to trucks carrying agricultural products to and from 

the Valley. Likewise, funds for the ports in the Los Angeles area may go to trucks 

based in the San Diego/Border region. 

2. Source category funding targets 

SB 88 recognizes the need for projects to compete against others in the same source 

category, not against projects in other categories. To implement this approach, set 

portions of the funding shall be targeted to each funding category, which may include 

one or more source categories. Source category funding targets support the reduction 

in local and regional health risk from goods movement as a primary consideration. The 

Staff Report describes the basis for the proposed targets. 

The proposed targets for each funding category, including all state and local Program 

administration funds, are: 

Dollars Funding Category

• $400 million: Heavy duty diesel trucks serving seaports and intermodal rail yards. 

• $360 million: Other heavy duty diesel trucks that haul goods, plus any truck stop 

 or distribution center electrification. 

• $100 million: Diesel freight locomotives. 

• $100 million: Shore power for cargo ships at berth, plus cargo handling equipment 

 used at a port or intermodal rail yard. 

• $ 40 million: Commercial harbor craft. 

3. Priorities for FY2007-08 funds 

ARB staff proposes that the Board adopt these priorities for FY2007-08: 

• Eligible projects that can quickly begin implementation and deliver air quality results. 

This is consistent with statutory direction to give priority to projects that achieve the 

earliest possible reduction of health risk in heavily impacted communities. These 

could be communities with high risks due to nearby goods movement facilities or 

communities impacted by high regional pollution levels from goods movement 

emissions. 

• Truck retrofit projects to add diesel particulate filters for immediate, broad scale, 

cost-effective risk reduction in many communities. Based on the implementation 

schedules in related truck regulations, we expect that these projects would only be 

eligible for FY2007-08 funding. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap II: ARB Program Administration 17 February 2008

• Port truck replacement projects in the Los Angeles/Inland Empire corridor to support 

the Port of Los Angeles and the Port of Long Beach clean truck tariff programs. 

These ports are requiring that all drayage trucks serving the ports be replaced (with 

models meeting 2007 emission standards) between late 2008 and the end of 2011. 

This schedule means any financial assistance from the Program needs to come in 

the early years. 

C. Project Specifications and Emissions 

1. Project specifications for each funding cycle 

Following each appropriation of Program funds to ARB, ARB staff shall evaluate and 

recommend for Board adoption specifications for equipment project options eligible to 

compete for funding in that cycle. These options must be able to cost-effectively reduce 

emissions and health risk with a high degree of certainty. ARB staff shall assess the list 

of emission reduction projects identified in SB 88 for technical feasibility, emission 

reduction potential, and cost. ARB staff shall also consider other effective technology 

that is verified, available, and can be widely deployed to reduce emissions quickly. 

Appendices A-G of these Guidelines detail the proposed equipment project options for 

FY2007-08 funds, including upgrade specifications, funding caps, minimum project life, 

and key operating conditions. Local agencies can choose to propose projects from all 

of the options in a category, or just a subset of those options, to best address the air 

pollution problem in that corridor. For future appropriations and updates to these 

Guidelines, ARB staff shall also consider the funding demand for eligible project 

options, technology advances and costs, regulatory actions, the need for equipment 

eligibility and project requirements, and other new information. 

SB 88 identifies projects eligible for funding to include: 

 

• The replacement, repower, or retrofit of heavy-duty diesel trucks. 

- The equipment project options for FY2007-08 funds include all of these 

approaches. 

• The replacement, repower, or retrofit of diesel locomotive engines, with priority given 

to switching locomotive engines. 

- The equipment project options for FY2007-08 funds include replacement and 

repower approaches. Retrofit devices and a stationary system to capture and 

control locomotive emissions in the rail yard are in development – once these 

technologies are demonstrated, verified by ARB for effectiveness and durability 

(if applicable), and commercially available, ARB staff will evaluate them for 

addition to the list of project options for the subsequent funding cycles. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap II: ARB Program Administration 18 February 2008

• The replacement, repower, or retrofit of harbor craft that operates at the state’s 

seaports. 

- The equipment project options for FY2007-08 funds include replacement and 

repower approaches. Once retrofit devices are demonstrated, verified by ARB 

for effectiveness and durability (if applicable), and commercially available, ARB 

staff will evaluate them for addition to the list of project options for the 

subsequent funding cycles. 

• The provision of on-shore electrical power for ocean freight carriers calling at the 

state’s seaports to reduce the use of auxiliary and main engine ship power. 

- The equipment project options for FY2007-08 funds include this technology. 

• Mobile or portable shoreside distributed power generation projects that eliminate the 

need to use the electricity grid. 

- The equipment project options for FY2007-08 funds include this type of 

technology. 

• The replacement, repower, or retrofit of cargo handling equipment that operates at 

the state’s seaports and rail yards. 

- ARB’s adopted regulation for diesel cargo handling equipment operating at ports 

and intermodal rail yards requires this equipment to be upgraded to emission 

levels achievable through replacement or (possibly) repower. To ensure that the 

eligible projects in this category meet the statutory requirement to reduce 

emissions not otherwise required by law or regulation, and are cost-effective, the 

equipment project options for FY2007-08 funds include only retrofit of energy 

storage systems for rubber-tired gantry cranes that already comply with the ARB 

rule. ARB will consider expanding the project options for the next funding cycle 

to include removal of the existing diesel engine and installation of electric power 

for these same cranes. 

• Electrification infrastructure to reduce engine idling and use of internal combustion 

auxiliary power systems at truck stops, intermodal facilities, distribution centers, and 

other places where trucks congregate. 

- The equipment project options for FY2007-08 funds include this technology. 

ARB staff proposes that certain types of projects or activities not be eligible for funding 

under the Program. Such projects or activities include, but are not limited to: 

 

• Projects to design, acquire rights-of-way, perform environmental review, build, 

improve, or operate transportation infrastructure (like roads, bridges, or 

interchanges; rail yards, tracks or sidings; rail or highway tunnel widening; railroad 

crossing grade separations; ship channel dredging; etc.). 

• Projects to design, acquire rights-of-way, perform environmental review, build, 

improve, or operate intermodal transfer or distribution centers (also called inland 

ports), except for electrification infrastructure to reduce engine idling and use of 

internal combustion auxiliary power systems at truck stops, intermodal facilities, 

distribution centers, and other places where trucks congregate. 

• Scientific or technical research and development activities, including programs to 

perform emissions testing on new technology. 

• Business plan development or implementation. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap II: ARB Program Administration 19 February 2008

• Equipment, vehicles, or ship berths owned or leased by the federal government, 

including the military. 

• Fuel or electricity purchases. 

• Operation and maintenance costs. 

• Legal costs. 

• Any other projects that cannot meet all of the requirements of these Guidelines. 

The timing and resource demands to get FY2007-08 funds obligated effectively 

preclude case-by-case consideration of projects for this funding cycle. If a local agency 

supports demonstration of a cost-effective technology or approach that is consistent 

with the statute, ARB staff will evaluate that technology for possible inclusion in the 

defined equipment project options in the next update to the Guidelines. 

2. Quantifying project benefits 

a) Pollutants 

SB 88 identifies specific pollutants that are targeted for emission reductions under the 

Program: 

• Diesel particulate matter (diesel PM), which ARB identified as a toxic air 

contaminant. 

• Nitrogen oxides (NOx) and sulfur oxides (SOx) that contribute to fine particles 

(PM2.5) formed in the atmosphere. 

• NOx and reactive organic gases (ROG) that form ozone in the atmosphere. 

SB 88 also adds reductions in greenhouse gases as a criterion to consider in evaluating 

which projects to fund. 

As part of simplifying the Program, ARB staff recommends quantifying diesel PM and 

NOx emissions and the resulting reductions from bond-funded projects. These are the 

two most consistently important pollutants to reduce the health impacts from goods 

movement in all four corridors, and the most likely to differ between competing 

proposals within the same source category. 

Of the targeted source categories, only ships are still significant sources of SOx 

emissions. Shore power projects to reduce ship emissions at dock will effectively cut 

this pollutant. It is not necessary to quantify the SOx emission reductions from each 

competing shore power project. Comparing the reductions in diesel PM and NOx 

emissions is an adequate basis to assess shore power project proposals relative to 

others in the same source category. Diesel engines emit ROG, but emission levels are 

typically less than 1/10 of the NOx emissions and also should not be a determining 

factor in project selection. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap II: ARB Program Administration 20 February 2008

Staff considered greenhouse gas emissions in recommending the source category 

funding targets, specifically the amount allotted for shore power and cargo equipment 

projects that reduce fuel consumption. Since projects are competing within source 

categories, there is not a need to quantify greenhouse gas reductions from individual 

projects to support the competitive process. 

b) Project benefits calculators 

ARB staff shall develop and make available on the Program website at: 

http://www.arb.ca.gov/gmbond a Project Benefits Calculator (Calculator) for each 

source category eligible for funding under these Guidelines, with one exception. 

Projects to install electrification infrastructure to reduce engine idling and use of internal 

combustion auxiliary power systems at truck stops, intermodal facilities, distribution 

centers, and other places where trucks congregate must be individually evaluated to 

determine the appropriate quantification method in consultation with the local air district 

and ARB. 

These Calculators shall provide the basis for local agencies to quantify the emission 

reductions and cost-effectiveness of proposed local agency projects. If a local agency 

identifies an eligible local agency project that cannot be quantified with the Calculator 

for that source category, the local agency should contact ARB staff for guidance. The 

Calculators shall also provide the basis for equipment owners to quantify the emission 

reductions and cost-effectiveness of proposed equipment projects. 

D. Application Process for Local Agency Projects

1. Notice of funding availability 

ARB staff shall issue a notice of funding availability (NOFA) no later than November 30th

of each fiscal year in which funds are appropriated by the Legislature. For FY2007-08 

funding, ARB shall issue the NOFA within two weeks of Board adoption of the Program 

Guidelines. 

The NOFA shall include: 

• Registration instructions for local public entities seeking Program funds, including 

concurrent submittal of a demonstration that the local public entity qualifies as an 

applicant for Program funds. 

• Submittal instructions and schedule for local agency project applications. 

• The requirement that each applicant hold at least one community meeting prior to 

submittal of the local agency project application to ARB (see Chapter III.D.1). 

2. Registration of local public entities 

A “local public entity” is defined to include a county, city, district, public authority created 

by statute, public agency, and any other political subdivision in the State. Local public 

entities do not include states or the federal government. The statute requires an 

applicant for Program funds to be both a local public entity and one that is involved in 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap II: ARB Program Administration 21 February 2008

the movement of freight through trade corridors or involved in air quality improvements 

associated with goods movement. 

The first step in the application process is simply registration as a local public entity with 

ARB through the process described in the NOFA to obtain access to the electronic 

application form. ARB shall staff verify the status of the local public entity and provide 

access to the electronic application form for each verified local public entity. 

Concurrent with the registration, the local public entity will also provide its qualifications 

for eligibility as a Program applicant so that ARB staff can begin the initial review of this 

demonstration. 

Note: Since the applications will require an extensive investment of time and resources 

by the local public entity, ARB staff encourages each entity to consult early with staff 

regarding its ability to meet the requirements of the statute and the Guidelines to qualify 

as an applicant. 

3. ARB review of applicant and project eligibility 

ARB staff shall complete an initial review of each local agency project application to 

verify that the local public entity qualifies as an applicant and that the proposed project 

is eligible to compete for funding consistent with these Guidelines. 

ARB staff shall notify any local public entity that does not meet all of the requirements of 

paragraphs (a)-(h) of this section within 20 days of ARB receipt of the complete 

application package. Notification may occur via letter or email to the designated local 

public entity contact, at staff’s discretion. 

ARB staff shall evaluate any deficiencies and determine, at staff discretion, whether to 

disqualify the application or pursue updates with the local public entity. 

ARB staff shall post a list of eligible local agency project applications on ARB’s Program 

website (http://www.arb.ca.gov/gmbond) for public review no later than 30 days after 

local agency project applications are due to ARB. 

a) Completeness 

ARB staff shall review a local agency project application to determine whether all 

required information is included in the application packet. At a minimum, ARB will verify 

that the application packet includes a complete application and a copy of the local 

agency board/commission resolution. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap II: ARB Program Administration 22 February 2008

b) Qualification as an applicant 

ARB staff shall assess each local public entity’s qualifications to determine if that entity 

meets the requirements of the statute and the Guidelines for applicants. ARB staff may 

request that the local public entity provide additional documentation to support this 

assessment. 

A local public entity that qualifies as a Program applicant may also be referred to as an 

applicant local agency or a local agency. 

c) Consistency with legal and equipment project specifications 

ARB staff shall review the local agency project application and assess the local 

agency’s certification that the proposed project achieves emission reductions “not 

otherwise required by law or regulation.” ARB staff shall also evaluate whether the 

proposed project conforms to the specifications of one or more equipment project 

options for that source category. Proposals that combine multiple source categories or 

that would allow emissions, equipment, technology, or Program funding levels that are 

inconsistent with one or more equipment project options defined in these Guidelines are 

subject to disqualification. 

In addition, for any local agency project to retrofit, repower, or replace locomotives 

operated by the Class I railroads, ARB shall evaluate whether the emission reductions 

that would be achieved by the locomotive equipment project are or are not necessary to 

satisfy any mandated emission reduction requirement under an agreement between a 

railroad company and a state or federal agency, or a local air district. ARB must find 

that the emission reductions are not necessary to determine that the local agency 

project is eligible to compete for funding. H&S §39625.5(a)(2)(B). 

d) Consistency with air quality plans for goods movement 

ARB staff shall assess the local agency project application to determine if it meets the 

requirement for consistency with local and regional plans (or regional elements of 

statewide plans) to reduce emissions from goods movement. 

e) Availability of full funding 

ARB staff shall assess the local agency project application to determine if it clearly 

identifies the source(s) of any State and non-State matching funds and demonstrates 

that these funds are reasonably available within the timeframes of the local agency 

project schedule. 

f) Project schedule and milestones 

ARB staff shall assess the local agency project application to determine if it identifies 

the required project milestones and includes a demonstration of the agency’s ability to 

meet the timelines of the Guidelines for fund obligation and expenditure. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap II: ARB Program Administration 23 February 2008

g) Data to determine air quality benefits and cost-effectiveness 

ARB staff shall evaluate the local agency project application to verify that it includes 

sufficient data on equipment, project life, and project option(s) to support and document 

the local agency’s calculation of the emission reduction factor and cost-effectiveness 

and match factor for the proposed project. 

h) Local agency project implementation demonstration 

ARB staff shall evaluate the local agency project application to determine if it effectively 

demonstrates that the local agency is prepared to administer the proposed project 

consistent with the detailed provisions of Chapter III.D Local Agency Project 

Implementation Requirements. This demonstration shall include a description of how 

the local agency will structure its program to meet each requirement summarized below, 

including substantive detail (wherever possible) regarding the procedures the agency 

will use to implement each provision. 

• Support public participation. 

• Conduct marketing and solicit equipment project applications (including targeted 

outreach and assistance to independent truck owner-operators). 

• Review and competitively rank project applications (including web posting). 

• Select equipment projects for funding (including any local board/commission 

process). 

• Conduct equipment pre-inspections and compliance checks. 

• Notify equipment owners of the status of their application. 

• Execute equipment project contracts. 

• Ensure equipment scrappage where required. 

• Conduct post-inspections of new or upgraded equipment. 

• Request expenditures from ARB. 

• Process invoices and requests from equipment owners for payment (including direct 

payments to vendors and reimbursements). 

• Calculate and report earned interest. 

• Evaluate equipment projects and assess on-going compliance with contract 

conditions. 

• Provide required reports to ARB (including the ability to submit equipment project 

data electronically when requested). 

• Participate in Program and fiscal audits. 

ARB staff shall also rely on this demonstration in its evaluation of the local agency’s 

ability to deliver the proposed project scope (see Chapter II.D.4 below) and its overall 

determination of a local agency’s readiness to quickly begin implementation and deliver 

air quality results (see Chapter II.B.3, Priorities for FY2007-08 Funds). 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap II: ARB Program Administration 24 February 2008

4. Evaluation of local agency capability to implement the project 

scope 

ARB staff shall also assess the local agency project application to determine if it 

affirmatively demonstrates that the agency has or will have the necessary expertise and 

resources in place to meet the demands of the proposed project scope, within the 

timelines established by the Guidelines. 

ARB staff will examine the local agency’s documented statistics or other basis for 

establishing the relationship between the number of pieces of equipment that can 

upgraded in a given timeframe and the number of program staff needed to accomplish 

those upgrade projects. ARB staff will rely on the documentation provided by the local 

agency and ARB’s experience with the Carl Moyer Program and other incentive 

programs to assess the adequacy of the proposed staff resources. If ARB staff 

determines that the local agency has demonstrated the ability to handle the project type, 

but only at a lesser scope or scale than proposed, staff may identify an alternative 

scope. 

For example, a local agency may propose to replace 5,000 trucks, but only 

demonstrate the resources and ability to process 2,000 trucks within the 

timelines established in the Guidelines. ARB staff may disqualify the application 

or recommend that the project go forward to the competitive process with a 

scope of 2,000 truck replacements (at a pro-rated funding level). 

If ARB staff determines that only a lesser scope is feasible based on the local agency’s 

demonstration, staff will notify the designated local agency representative in writing and 

move the project forward to the competitive process based on the benefits of the prorated proposal for the source category. In the FY2007-08 funding cycle, ARB staff shall 

assume local agency support for a pro-rated proposal based on the acknowledgement 

required on the application. 

5. Match funding 

SB 88 distinguishes between State funds and monies from all other sources. It also 

directs ARB to maximize the amount of match funds used to supplement Program 

funds. The match required to cover the difference between the Program funding cap 

and the total project cost can come from the private sector, local agencies, or the 

federal government. Private match funding can be provided by the equipment owner, 

an industry sponsored program, or other sources. 

a) Carl Moyer program 

Local air districts cannot combine funding from this Program and direct funding from the 

Carl Moyer program on the same equipment project (i.e., funds directly authorized 

under H&S §44091.1(a) and Public Resources Code §42889). 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap II: ARB Program Administration 25 February 2008

In response to air district requests, ARB staff has evaluated whether some “passthrough” vehicle registration fees that can be used in the Carl Moyer program may also 

be used for match funding under this Program. Under AB 923 (Chapter 707, Statutes of 

2004), the $2 surcharge on the vehicle registration fee can be used for match funding of 

Proposition 1B projects involving the accelerated retirement, repowering, or retrofitting 

of trucks. Conversely, the $2 surcharge cannot be used under this Program for match 

funding on non-motor vehicle sources, such as locomotives, harbor craft, cargo ships, 

and off-road cargo equipment. 

Program funds and the $2 surcharge may be combined on the same equipment project 

if all of the following conditions are met: (a) the equipment project option(s) to be 

funded includes only trucks, (b) the equipment project meets both bond Program 

eligibility requirements and Carl Moyer funding criteria, (c) the equipment project does 

not exceed the Carl Moyer Program cost-effectiveness limit, with the project cost 

including both Program and AB923 funds, and (d) the $2 surcharge funds are not 

counted as part of an air district’s Carl Moyer match requirement. 

For the purpose of competitively ranking local agency and equipment projects under this 

Program, the calculation of reductions per State dollar invested must treat both bond 

Program monies and the $2 surcharge monies as State funds since the surcharge 

monies would otherwise be used in the Moyer Program. 

6. Competitive ranking of local agency projects 

ARB staff shall use a quantitative approach to develop a prioritized list of eligible local 

agency projects. This process will be applied to competing local agency projects within 

each trade corridor and funding category.

ARB staff shall publish the list of competitively ranked projects on the ARB website. 

The competitive ranking shall be quantitative based on multiple factors – emission 

reductions and a measure of cost-effectiveness that considers match funding. The 

calculation of emission reductions uses the Carl Moyer program protocol of weighting 

combustion PM emissions (essentially diesel PM) by a factor of 20 relative to other 

pollutants to account for the greater health impacts of PM per ton of emissions. This 

protocol helps target Program funding to the projects that will achieve the greatest 

reduction in health risk. 

a) Emission reduction score 

For each equipment project option that a local agency proposes to implement within a 

source category, ARB staff shall review the local agency’s estimate of the total 

pollutant-weighted emission reductions in California, over the average project life, based 

on the Project Benefits Calculator for that source category. 

Emission reductions = Reduction in NOx + (combustion PM x 20) emissions in 

California over the average project life in tons 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap II: ARB Program Administration 26 February 2008

 

If a local agency proposal combines multiple equipment project options within a source 

category, ARB staff shall confirm that the calculation repeats this process for each 

option, and adds the reductions together for the source category. 

ARB staff shall list projects in descending order of emission reductions, with the 

greatest emission reductions on top and the lowest emission reductions on the bottom. 

Staff shall number or score each project starting at the bottom with a score of 1 and 

continuing consecutively to the top project. For example, if there are 8 project 

proposals, the one with the greatest emission reductions would receive a score of 8. 

See Figure 1 for an example. 

 

Emission Reduction Score = number from above evaluation 

b) Cost-effectiveness and match score 

For each proposed equipment project option in a source category, ARB staff shall 

review the local agency’s estimate of the total pollutant-weighted emission reductions 

(as determined above and converted from tons to pounds), divided by the total State 

funding proposed for the project, based on the Project Benefits Calculator for that 

source category. Total State funding includes requested Program funds (project and 

administration funds), plus any other State dollars – see discussion under Chapter 

II.D.5, Match Funding, on treatment of the $2 vehicle registration fee surcharge under 

AB 923 as State dollars. 

Cost-effectiveness and match = weighted emission reductions (lbs)/total State $

If the proposal includes multiple equipment project options, ARB staff shall confirm that 

the calculation repeats this process for each option, and adds the costs together and 

the benefits together to determine the average cost-effectiveness and match number for 

the source category. 

ARB staff shall list projects in descending order of emission reductions per State dollar, 

with the highest number on top and the lowest number on the bottom. Staff shall 

number or score each project starting at the bottom with a score of 1 and continuing 

consecutively to the top project. For example, with 8 project proposals, the one with the 

greatest emission reductions per State dollar would receive a score of 8. See Figure 1 

for an example. 

Cost-Effectiveness and Match Score = number from above evaluation 

This calculation of cost-effectiveness indirectly accounts for the level of match funding. 

A project will always have a combination of Program funding and match funding (from 

State or non-State sources) to cover the total cost of the project. The cost-effectiveness 

equation uses the full emission reductions achieved by the total project funding, not just 

a subset of the reductions in proportion to the State funding component. By counting 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap II: ARB Program Administration 27 February 2008

the total emission reductions, the Program recognizes the benefits of non-State match 

funds and offers a competitive advantage to projects with greater match. 

For example, assume the Program offers funding for up to 50 percent of the cost of new 

equipment, with the other 50 percent covered by non-State match funds (resulting in a 

1:1 match). Most project proponents seek the maximum Program funds, but proponent 

X only requests Program funding for 25 percent of the total cost, with the other 75 

percent covered by non-State match funds (effectively providing a 3:1 match). The 

emission reductions for all the projects would likely be similar, but the total reductions 

per State dollar are much greater for proponent X because this project relies on less 

State funds and more match funds. 

c) Competitive ranking 

ARB staff shall add the Emission Reduction Score to the Cost-Effectiveness and Match 

Score to determine the final points for each local agency project. ARB staff shall rank 

local agency projects within each corridor and funding category from highest points to 

lowest points. See Figure 1 for an example. 

Note: projects to repower or replace switcher locomotives shall be considered a higher 

priority than other types of locomotive equipment project options, consistent with the 

statutory direction to give funding priority to switchers. 

Figure 1. Local agencies A,B,C submit 

competing truck projects (hypothetical)

C-5,299 tons Score: 1

B-6,056 tons Score: 2

A-7,570 tons Score: 3

Emission

Reduction Score

C-0.4 lbs/$ Score: 2

B-0.5 lbs/$ Score: 3

A-0.3 lbs/$ Score: 1

Cost-Effectiveness 

and Match Score

Project C: 1+2 3 points

Project A: 3+1 4 points

Project B: 2+3 5 points

Competitive Ranking

C/ Replace 

700 trucks

B/ Replace 

800 trucks

A/ Replace 

1,000 trucks

Agency/ 

Project

State 

Dollars

W eighted 

Em ission 

Reductions 

(tons)

Reductions over 

8-Year Project Life

5,299

6,056

7,570

NOx tons PM tons

2,219

2,536

3,170

154

176

220

$28M at 

$40k/truck

$24M at 

$30k/truck

$50M at 

$50k/truck

Results from Project Benefits Calculator:
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap II: ARB Program Administration 28 February 2008

7. Public workshops on eligible local agency projects 

ARB staff shall hold no less than three public workshops statewide to discuss the 

competitively ranked list of eligible local agency projects and any preliminary staff 

recommendations for funding local agency projects. At least one workshop each will be 

held in northern California, the Central Valley, and southern California. At staff’s 

discretion, these workshops may be conducted between release of the competitive 

ranking and development of funding recommendations or after development of staff’s 

funding recommendations. For FY2007-08 funds, these workshops are not required by 

statute. H&S §39626(c)(2). 

8. Recommendations for funding local agency projects 

Based on the competitively ranked list of eligible local agency projects and public input, 

ARB staff shall use a qualitative approach to develop recommendations on the level of 

funding for the top project(s) in each corridor and funding category. This approach shall 

consider the availability of Program funds, the corridor and source category funding 

targets, and priorities established by the Board for each funding cycle. 

ARB staff shall make these funding recommendations for local agency projects 

available to the public via ARB’s Program website (http://www.arb.ca.gov/gmbond) prior 

to the public hearing conducted by the Board. 

Within each corridor and funding category, ARB staff shall follow this process: 

a) Consideration of available funds and funding priorities 

Starting with the project with the highest competitive ranking above, ARB staff shall 

compare the requested Program dollars with the available funds, the Program funding 

targets for the corridor and funding category, and any priorities identified by the Board 

for that year. 

b) Funding level for local agency project proposals

ARB staff shall recommend whether the most competitive local agency project in each 

corridor and funding category should be funded in whole, in part, or not at all in that 

funding cycle. ARB staff may recommend pro-rating the requested Program funding 

and the estimated performance measures (pieces of equipment, emission reductions, 

etc.) based on the available dollars and funding priorities. 

Board priorities may result in preferential funding for one of the equipment project 

options proposed in the local agency application for a source category (i.e., if the Board 

makes funding for PM filter retrofits a priority for FY2007-08 funds, ARB could provide 

more funding for that equipment project option relative to the other options within the 

source category). If Board priorities do not favor a specific equipment project option 

within a source category, ARB will assume that any pro-rated funding will be applied 

proportionally to all of the equipment project options the local agency proposes to 

implement. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap II: ARB Program Administration 29 February 2008

Once the recommended funding is determined for the top project, ARB staff shall 

evaluate the project with the second highest competitive ranking in consideration of 

available funds and funding priorities. Staff shall continue until the appropriate level of 

funding for that corridor and category – in that funding cycle -- is reached. 

Based on the process described above for evaluating and ranking eligible local agency 

projects, as well as assessing the funding level, ARB staff shall issue its written 

recommendations to the Board for local agency project funding with the available grant 

funds. 

9. Public hearing and Board action 

The Board will hold a noticed public hearing to consider public testimony, written 

comments, and staff recommendations for funding local agency projects with the 

available Program monies. At that hearing, the Board may adopt a resolution approving 

a final list of primary local agency projects and corresponding funding amounts for each 

project. This Board resolution provides ARB staff with the authority to enter into local 

agency project grant agreements with the selected local agencies. H&S §39626(c)(3). 

The ARB Executive Officer may delegate in writing the ability to sign these local agency 

project grant agreements to another individual or individuals on ARB’s executive 

management team. 

The project list approved by the Board may also identify “backup” proposals (additional 

local agency projects or increases in funding levels for the approved projects). These 

backup proposals may be awarded funding if local agency project grant agreements 

cannot be executed for one or more of the primary projects within the timeframe 

specified by the Board in the resolution. 

10. Local agency project grant agreement 

The Board’s funding decisions shall become legally enforceable through executed local 

agency project grant agreements between ARB staff and the selected local agencies. 

Each local agency project requires a separate local agency project grant agreement. 

ARB staff shall prepare and submit for review and signature two signed copies of the 

local agency grant agreement to each local agency approved for bond funding. After an 

authorized representative from the local agency signs both copies of the grant 

agreement, the local agency shall retain one fully executed copy for its files, and return 

one fully executed copy to ARB. 

Each local agency project grant agreement shall include, but is not limited to, the 

following elements. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap II: ARB Program Administration 30 February 2008

a) Standard grant agreement provisions 

• Grant agreement number—unique tracking number provided by ARB 

• Effective date 

• Term of grant agreement 

• Local agency contact information 

• Indemnification—local agency agrees to indemnify and hold harmless the State for 

any liability arising out of the performance by the local agency 

• Severability—remaining provisions of an agreement continue in effect even if a court 

holds a specific provision invalid 

• Force majeure—ARB and local agency are not liable for any delay or failure in 

performance resulting from war, natural disasters, and other acts beyond their 

control 

• Agreement amendments—amendments shall only occur by mutual agreement in 

writing and signed by all parties 

• Environmental justice—local agency agrees to conduct its programs in a manner 

that ensures the fair treatment of all people in the State 

b) General Program provisions 

• Application--incorporate by reference the original local agency application and 

board/commission resolution 

• Guidelines—local agency agrees to implement project in conformance with all 

applicable requirements of the Program Guidelines 

• Reporting requirements—local agency is responsible for submitting to ARB quarterly 

data updates, semi-annual reports, and local agency project completion reports 

• Ongoing evaluations and audits—local agency agrees to allow ongoing evaluations 

and audits by ARB, other State agencies, or their designated representative(s) 

• Records access requirements—local agency agrees to allow ARB or its designated 

representative(s) access to evaluate or audit Program records 

• Recordkeeping requirements—local agency agrees to retain Program records, i.e. 

invoices, contracts, and correspondence, for at least two years after the project ends 

or three years after final payment, whichever is later 

• Enforcement—provisions authorizing ARB or its designee to inspect equipment 

projects 

• Non-performance includes, but is not limited to: 

- Failure to comply with the Program Guidelines or statutes 

- Failure to obligate or expend Program funds within established timelines 

- Insufficient performance or widespread deficiencies with program oversight, 

enforcement, record keeping, contracting provisions, inspections, audit 

procedures or any other Program element as determined by ARB 

- Misuse of Program funds 

- Funding of ineligible equipment projects or other items 

- Exceeding administrative fund allotment 

- Insufficient, incomplete, or faulty project documentation 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap II: ARB Program Administration 31 February 2008

- Failure to provide required documentation or reports requested from ARB, DOF, 

or other agencies in a timely manner 

- Poor performance as determined by an audit conducted by ARB, DOF or other 

designee 

• Remedies for non-performance include: 

o Probation 

o Recovery of funds 

o Constraints on opportunity to compete for future Program funds 

• Direct payments to vendor—allowance for local agency payments directly to vehicle 

or equipment dealers or manufacturers if requested by equipment owner 

• Tax implications—local agency agrees to notify equipment owners of possible tax 

implications from receipt of Program funds and encourage participants to consult a 

tax professional 

• Program acknowledgment—local agency agrees to acknowledge the Program as a 

funding source in any related media events or other publicity material. 

• Earned Interest—local agency agrees to maintain records and report on interest 

earned on Program funds in local agency accounts, and to expend earned interest 

according to the provisions in the Program Guidelines. 

c) Source category-specific elements 

• Local agency project description (including each equipment project option within the 

source category). 

• Estimated total cost for project and subtotals for each equipment project option. 

• Project cost breakdown (including technology/equipment purchase, labor for 

retrofit/installation, etc.) and subtotals for each equipment project option. 

• Eligible costs—costs directly tied to the purchase and installation of upgraded 

equipment or other expenses as defined in the equipment project specifications. 

• Funding caps for each equipment project. 

• Ineligible costs. 

• Total grant amount and subtotals for each equipment project option. 

• Non-State match funds and source of funds. 

• Project performance benchmarks—expected number of vehicles, pieces of 

equipment, berths, etc. to be upgraded and expected emission reductions. 

• Project schedule—timeframe for completing the local agency project including major 

milestones and any milestones specific to each equipment project option. 

• Expenditure schedule—estimated schedule for ARB to expend funds to the local 

agency. 

• Request for payment—steps for a local agency to request expenditure of Program 

funds. 

• Equipment project inspections--local agency agrees to complete equipment project 

pre-inspections prior to execution of an equipment project contract and postinspections prior to reimbursement, except in the case of direct payment to vendor. 

• Equipment project contracts—local agency agrees to include all equipment project 

requirements and conditions (i.e., restrictions on operating location, provisions for 

electronic monitoring devices, etc.) in contracts with equipment owners. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap II: ARB Program Administration 32 February 2008

• Proper disposal of old equipment—local agency agrees to establish agreements with 

qualified salvage yards and verify scrappage/disposal of old vehicle, vessel, 

equipment, or engine. 

• Small businesses—outreach to small businesses for infrastructure construction. 

11. $25 million in early grants for FY2007-08 funds 

SB 88, as set forth in H&S §39626.5(c), makes available up to $25 million in FY2007-08 

funds for the purpose of executing grant agreements directly with ports, railroads, or 

local air districts for eligible projects to achieve the earliest possible heath risk reduction. 

SB 88 requires that ARB allocate funds under this “early grant” provision consistent with 

these Guidelines, and that ARB provide sufficient opportunity for the public to review 

and comment on any projects proposed for funding. Appendix H outlines the process 

and applicable requirements of the Guidelines for the early grants. 

The public review process started with release of the Staff Report on January 3, 2008. 

This Report lists the $177 million in early grant proposals from air districts and staff’s 

recommendations for funding early grant projects totaling $25 million. Staff is soliciting 

public input on these recommendations via workshops, meetings, written comments, 

and testimony at the Board hearing. 

E. ARB Program Oversight 

ARB is the administering agency for this Program, and is responsible for ensuring that 

Program funds are spent on equipment projects that meet the provisions of statute (SB 

88 and AB 201) and these Guidelines. 

Through the budget bills for upcoming FY2008-09 (SB 1067 and AB 1770), the 

Administration proposes a technical modification to align the standard timeframes for 

ARB to obligate and liquidate Program funds with the extended timeframes provided for 

local agencies under SB 88. Under the current requirements applicable to ARB and 

other State agencies, ARB must liquidate funds (i.e., make final payment to local 

agencies) up to four years before those local agencies would be required to liquidate 

the funds for completed projects. The budget bill will align the timelines so that the 

State retains control of Program funds until they are necessary to complete an 

equipment project, consistent with sound fiscal and accountability practices. These 

Guidelines are structured to rely on the alignment, but also include references to the 

existing law to allow Board adoption of the Guidelines and execution of local agency 

project grant agreements prior to passage of the FY2008-09 State budget. 

1. ARB obligations to local agencies 

ARB shall obligate Program funds for each fiscal year’s appropriation according to the 

obligation deadlines set forth in State law. This is a two-step process, beginning with 

the Board’s allocation of funds via resolution to specific local agency projects and 

ending with fully executed local agency project grant agreements. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap II: ARB Program Administration 33 February 2008

2. ARB expenditures 

ARB shall liquidate Program funds for each fiscal year’s appropriation according to the 

liquidation deadlines set forth in State law. 

• Once Program funds are obligated, with the exception of earned interest, any funds 

returned or unspent by a local agency revert back to the California Ports 

Infrastructure, Security, and Air Quality Improvement Account, and must be reappropriated by the Legislature. It is therefore the policy of ARB to retain grant funds 

until necessary for the purchase of equipment, for the purpose of advancing the 

completion of an equipment project, or for the purpose of meeting liquidation 

deadlines set forth in State law. 

• ARB shall only expend Program funds upon receipt of a valid Grant Expenditure 

Request submitted to ARB by an authorized local agency representative acting 

under a fully executed Local Agency Project Grant Agreement. 

a) Administration funds 

Administration funds expended by ARB for this Program may be used by a local agency 

for the administration of any local agency project covered by a fully executed local 

agency grant agreement. If a local agency has more than one fully executed local 

agency grant agreement with ARB, administration funds identified under one grant 

agreement may be used to assist in the implementation of another grant agreement. 

The local agency shall not use administration funds in excess of the total administration 

funds allowed under all grant agreements (i.e., the sum of all administration funds for 

one local agency shall not exceed 5 percent of the total grant awarded to that agency). 

(1) Initial expenditure 

Of the maximum grant award allowed for administration funds, ARB may initially expend 

up to 50 percent of a local agency’s administration funds for all source categories 

except shore power. 

For the shore power source category, ARB may initially expend up to 25 percent of the 

local agency’s administration funds. 

(2) Additional expenditures 

For truck and commercial harbor craft source categories, ARB shall expend the 

remaining Program funds for administration only after 50 percent of the Program funds 

for equipment projects are expended by the local agency or ARB comes within six 

months of a liquidation deadline, whichever is sooner. ARB staff shall verify the local 

agency’s documentation that 50 percent of the equipment project funds were expended 

prior to the additional expenditure. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap II: ARB Program Administration 34 February 2008

For the remaining source categories (locomotives, shore power, truck stop/distribution 

center electrification, and cargo handling equipment), ARB shall expend the remaining 

Program funds for administration only after 100 percent of the Program funds for 

equipment projects are liquidated by the local agency or ARB comes within six months 

of ARB’s liquidation deadline, whichever is sooner. ARB staff shall verify the local 

agency’s documentation that the equipment project funds were liquidated prior to 

expenditure. 

b) Equipment project costs 

(1) Initial expenditure 

ARB may initially expend Program funds for equipment projects according to the 

provisions for each source category listed in Table 2.1 below. 

Table 2.1 Initial Expenditures for Equipment Project Funding 

Source Category % of Funds Requirements 

Trucks serving ports and 

intermodal rail yards 

up to 100% 

Other heavy duty diesel trucks up to 100% 

Cargo handling equipment up to 100% 

Shore power up to 10% 

Locomotive up to 10% 

Harbor craft up to 10% 

Truck stop/distribution center 

electrification 

up to 10% 

Initial expenditure may be requested once the 

competitively ranked equipment project list is 

posted on the local agency website as a 

demonstration of the local agency’s readiness 

to execute equipment project contracts; or 

within six months of ARB’s liquidation deadline 

as specified in State law, whichever comes first. 

(2) Additional expenditures 

ARB may expend the remaining Program funds for equipment projects according to the 

provisions for each source category listed Table 2.2 below. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap II: ARB Program Administration 35 February 2008

Table 2.2 Additional Expenditures for Equipment Project Funding 

Source 

Category 

% of 

Funds 

Requirements 

Trucks serving 

ports and 

intermodal rail 

yards 

remaining 

Other heavy 

duty diesel 

trucks 

remaining 

Cargo handling 

equipment remaining 

Additional expenditures may be requested at any time after the initial 

expenditure from ARB, but shall be requested no later than six 

months before ARB’s liquidation deadline under State law. 

Shore power remaining 

Locomotives remaining 

Harbor craft remaining 

Additional expenditures may be requested no sooner than six months 

prior to the anticipated post-inspection date, but shall be requested no 

later than six months before ARB’s liquidation deadline under State 

law. 

Truck 

stop/distribution 

center 

electrification 

projects 

remaining 

Additional expenditures may be requested no sooner than six months 

after the post-inspection date, but shall be requested no later than six 

months before ARB’s liquidation deadline under State law. 

3. Earned interest 

ARB shall receive local agency reports on the interest earned and expended from 

Program funds held in local agency accounts. Earned interest provisions for local 

agencies are detailed in Chapter III.E.3. 

If a local agency is unable to expend earned interest according to the provisions of 

these Guidelines, ARB shall reallocate the interest payments collected from these local 

agencies in the manner specified in these Guidelines. 

4. Ongoing evaluations 

ARB staff shall evaluate local agency and equipment projects on an ongoing basis. 

Evaluations are designed to meet the accountability requirements of SB 88 and the 

Executive Order S-02-07. Any Program funds expended on equipment projects that 

ARB finds are not eligible for funding shall be documented as an adverse finding in the 

local agency’s audit. The ARB Executive Officer may require that the local agency 

reimburse ARB the Program funds identified in an adverse finding, or may seek other 

remedies from the local agency as the Executive Officer deems appropriate. 

a) Ongoing evaluations of local agency projects 

Ongoing evaluation of local agency projects includes reviewing local agency project 

records to ensure consistency with Program Guidelines and emission reduction goals. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap II: ARB Program Administration 36 February 2008

Evaluations may occur as ARB Program staff deems necessary and feasible with 

available resources. 

Local agencies shall permit the ARB, the Department of Finance, the Bureau of State 

Audits, or any authorized designee, access, during normal business hours, to conduct 

Program and fiscal audits. 

b) Ongoing evaluations of equipment projects 

Ongoing evaluation of equipment projects includes reviewing equipment project records 

to ensure consistency with Program Guidelines and emission reduction goals, and site 

visits to inspect engines, vehicles, or other equipment funded under the Program. 

Evaluations of equipment projects may occur unannounced as ARB Program staff 

deems necessary and feasible with available resources. 

Equipment owners shall permit the local agency, ARB, the Department of Finance, the 

Bureau of State Audits, or any authorized designee, access, during normal business 

hours, to conduct ongoing evaluations for the purpose of monitoring the Program. 

In addition to local agency review to ensure the appropriate registration and operation of 

bond funded equipment, ARB may periodically monitor, through federal, State, and local 

equipment registration databases, as applicable, ongoing equipment project compliance 

with California registration and operational requirements. Equipment registration 

databases may include, but are not limited to: 

o California Air Resources Board databases. 

o California Department of Motor Vehicle databases. 

 California International Registration Plan (CA IRP). 

o California Department of Fish and Wildlife databases. 

o California Department of Transportation databases.

o Local agency databases, as available, such as air district permit records 

or port access databases. 

When ARB field inspectors check trucks, locomotives, harbor craft, cargo handling 

equipment, and ship berths for compliance with ARB regulations or enforceable 

agreements, they shall also assess compliance with Program requirements for any 

bond-funded equipment. The inspectors shall determine if the equipment received bond 

funding via an equipment database and evaluate bond-funded equipment to ensure that 

all pollution controls are functioning and the equipment is meeting the Program 

operating conditions. 

Nothing in these Guidelines is to be construed as limiting or otherwise affecting in any 

way ARB’s enforcement authority for ensuring that equipment subject to the Program 

complies with all Program requirements, as well as all applicable regulations or 

enforceable agreements. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap II: ARB Program Administration 37 February 2008

(1) Electronic monitoring devices 

With the exception of contracts for locomotive projects and grid-based shore power 

projects, all equipment project contracts shall require that the equipment owner agree to 

the installation and use of an electronic monitoring device at any time during the 

equipment project contract term. Equipment project contracts for locomotives shall 

require equipment owners to install and use global positioning systems (GPS), and 

report data. 

ARB staff is considering the widespread use of electronic monitoring devices on bondfunded equipment for the primary purpose of tracking equipment operational 

requirements (100 percent California operation) and equipment activity within the four 

trade corridors. In a subset of equipment projects, ARB is considering more 

sophisticated devices to collect additional activity or engine operational data for ARB 

inventory needs. 

Staff recognizes the privacy concerns that equipment owners may have about any type 

of electronic monitoring device. Staff intends to develop a proposal for public review 

and seek comment prior to including requirements for specific electronic monitoring 

devices and data reporting protocols in future updates to these Guidelines. 

In developing the electronic tracking component of this Program, ARB staff recognizes 

the detailed reporting and database requirements associated with other ARB truck 

programs as well as the recently adopted truck replacement plans at the Ports of Los 

Angeles and Long Beach. ARB staff is working to coordinate the Program requirements 

and specifications with these other efforts, where possible. 

Examples of electronic monitoring devices include, but are not limited to, the following: 

• Passive GPS (Global Positioning System) tracking devices 

- Passive GPS systems are less expensive (potentially lower than $300/unit) than 

real-time GPS systems, and do not have associated subscription costs. The 

trade-off, however, is that each unit would require local agency or ARB 

inspectors to physically download data from each unit. 

• Real-time GPS tracking devices 

- Real-time GPS systems are more expensive (upward of $5,000/unit for the 

equipment and 5 years of monitoring), but have the capability of capturing realtime location information and remotely downloadable data. 

• RFID (Radio-Frequency Identification) 

- RFID systems are best used in a controlled gate environment to identify 

equipment entering or exiting a facility (like a port or rail yard). These systems 

may be used to track the number of visits to a port, but cannot be used to verify 

California operation. 

For each equipment project, all data collected from any electronic monitoring device 

required under this Program shall be provided to the local agency administering that 

equipment project and to ARB staff or its contractors for their use and analyses. Such 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap II: ARB Program Administration 38 February 2008

data may include, but not be limited to, vehicle identification number (VIN); date, time, 

and distance traveled for each trip; GPS locational information; emissions or fuel usage 

rates; and other information collected from gauges, sensors, and other sources. 

Further, notwithstanding the nature of data collected, each equipment project contract 

shall expressly specify that no data collected from these monitoring devices shall be 

construed in any way as constituting non-disclosable personal or locational identifiers. 

Data collected from these monitoring devices shall be disclosed only to the local agency 

and ARB staff or its contractors, except as otherwise provided by law. Such data shall 

be provided upon request in the form and format agreed to by the parties or as 

otherwise specified in this Guideline. Each equipment project contract shall require all 

signatories to acknowledge their understanding and agreement to allowing the local 

agency and ARB staff and its contractors such access to the collected data. Nothing in 

this provision or these Guidelines shall be construed in any way as limiting ARB's ability 

to publish or release the collected data or the results of analyses using these collected 

data in summary form without individual personal identifiers; for purposes of this 

Program, "personal identifiers" include only the name of the vehicle driver or equipment 

operator and the driver's or operator's home address in alpha-numeric format (e.g., 

1000 Apple Way), if collected. 

5. Auditing 

Audits are designed to ensure that all local agency and equipment projects funded 

under the Program meet the requirements of these Guidelines. ARB or its designees 

shall audit a sufficient number of local agency projects and equipment projects each 

year to ensure effective Program implementation and accountability, subject to available 

resources. 

a) ARB audits of local agency projects 

Pursuant to H&S §39625.02(e)(1), ARB staff or its designees shall conduct program 

and fiscal audits of the local agencies. 

To ensure objectivity and the efficient use of resources, ARB shall use a risk-based 

approach to select specific local agency projects for audit during a given year. 

Consistent with this approach, local agencies demonstrating good performance when 

audited will likely be audited less frequently in the future than similarly-funded local 

agencies with poorer audit results. 

Any Program funds that local agencies expend on projects not eligible for Program 

funds shall be documented as an adverse finding in the local agency’s audit. The ARB 

Executive Officer may require that the local agency reimburse ARB the Program funds 

identified in an adverse finding, or may seek other remedies from the local agency as 

the Executive Officer deems appropriate. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap II: ARB Program Administration 39 February 2008

The responsibilities of ARB or its designees during an audit include, but are not limited 

to, the following: 

• Audits shall be conducted in a manner that reflects the public responsibility and 

accountability entrusted to ARB. 

• ARB shall maintain open channels of communication with the local agency under 

audit, for example, fully explaining the audit’s scope and procedure at the beginning 

of the process, informing the affected parties of potential issues as they unfold, 

affording numerous opportunities for input throughout the audit, thoroughly 

discussing any findings and recommendations during the exit interview, and allowing 

the local agency an opportunity to formally respond to the audit report. 

• To ensure objectivity and predictability, ARB shall base its findings and 

recommendations on materials such as State law, these Goods Movement Emission 

Reduction Program Guidelines for Implementation, Generally Accepted Accounting 

Principles (GAAP), e-mail communications between ARB and the local agency or 

equipment owner, the local agency project application, and any local agency’s own 

requirements. 

• All final audit reports, local agency or equipment owner responses and related 

documents shall be readily available to the public. 

• ARB shall conduct sufficient follow-up activities, including conducting follow-up 

reviews to ensure that any identified deficiencies are promptly and effectively 

addressed. 

The responsibilities of a local agency during an audit shall include, but are not limited to, 

the following: 

• Ensure that program files and other requested information are readily available to 

audit staff. 

• At a minimum, participate in the entrance and exit interviews and ensure that local 

agency or equipment owner staff is cooperative with audit staff. 

• Communicate fully with audit staff throughout the course of an audit. 

• Make every effort, including requesting assistance from ARB if necessary, to ensure 

that identified deficiencies are promptly and effectively rectified. 

To assist ARB with the audit process, local agencies shall provide to ARB staff, upon 

request, access to documentation pertaining to the Program which includes, but is not 

limited to, the following: 

• General: 

- Organization charts. 

- Contact information for the Program and accounting designated liaisons. 

- Copies of grant agreements (with amendments) between ARB and the local 

agency, and contracts between the local agency and the equipment owner. 

- Reports filed with ARB, if applicable. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap II: ARB Program Administration 40 February 2008

• Accounting records: 

- General ledger chart of accounts. 

- Copies of the policies and procedures for: 

o Receipt and deposit of project funds. 

o Review, approval, and payment of project invoices.

o Calculation and allocation of program administration costs. 

o Tracking and allocating interest earned on the Program. 

- Reports from the general ledger showing receipts, expenditures, interest 

earnings, and annual balances for projects during the audit period. 

- Copies of audit reports covering financial statements, operations, and internal 

controls during the audit period. 

- Access during fieldwork to the following accounting records: 

o Invoices/claims from the local agency to ARB for Program payments, and 

invoices from equipment owners to the local agency.

o Receipts/deposit slips showing payments received from ARB. 

o Invoices from subcontractors/consultants to the local agency or equipment 

owner. 

o Canceled checks or other expenditure documents supporting payment to the 

subcontractors/consultants. 

o Bank statements and reconciliations throughout the audit period. 

• Program Records: 

- Reports that list all projects associated with the programs showing: 

o Equipment project number. 

o Subcontractor and consultant contact information. 

o Dates, check numbers, amounts, and funding sources for each equipment 

project expenditure. 

o Fiscal year of the funding appropriation for the applicable grant agreement 

- Copies of any and all records prepared by the local agency, the equipment 

owner, and any third parties involved in the application, review, inspection, 

scrappage, or payment steps. 

- Copies of the local agency procedures for review, approval, and submittal of 

subcontractor invoices for payment. 

- Access during fieldwork to the following Program project records: 

o Contracts between the local agency or equipment owner and the 

subcontractors/consultants. 

o Invoices from subcontractors/consultants to the local agency or equipment 

owner. 

o Requests to local agency’s accounting for payment of project invoices. 

Local agency shall retain all records subject to the recordkeeping requirements for local 

agency projects. Retained records shall include, but are not limited to: local agency file 

reviews of annual equipment project reports, annual reports provided by equipment 

owners, any relevant project updates provided by equipment owners, documentation of 

equipment inspections, and other relevant information. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap II: ARB Program Administration 41 February 2008

Local agencies shall provide access to all required records and personnel with 

knowledge of such records to the ARB, the Department of Finance, the Bureau of State 

Audits, or any authorized designee during normal business hours, to conduct Program 

and fiscal audits. 

In conjunction with local agency audits, ARB staff or an authorized designee, shall also 

use a risk-based approach to select specific equipment projects. If ARB staff discover 

non-performance issues with specific equipment projects, the local agency shall be 

notified to take appropriate action. If ARB staff discover that the equipment project is 

not in compliance with ARB regulations, the ARB Enforcement Division shall be notified 

to take appropriate enforcement action. 

6. ARB reporting 

ARB staff shall provide regular updates and reports on the implementation status of the 

Program. 

a) Public website 

ARB is committed to providing the public with information regarding the status of bondfunded programs. In accordance with ARB policy and Executive Order S-02-07, ARB 

shall provide periodic data updates on ARB’s program website: 

http://www.arb.ca.gov/gmbond. At a minimum, ARB shall post: 

• Local agency semiannual reports. 

• Local agency project completion reports. 

• ARB annual reports. 

ARB shall also develop and maintain an on-line database showing information and 

progress on local agency projects, as well as individual equipment projects. This 

searchable data will allow the public to find out about projects funded in a specific area 

and the implementation status of each project. ARB staff will develop the local agency 

project tracking element first. The equipment project element will follow. Once this 

element is operational, local agencies shall be required to update the equipment project 

information quarterly. 

b) Annual community meetings 

In each trade corridor, ARB staff shall co-host along with the local agencies 

administering local agency projects in that corridor, at least one annual community 

meeting to provide an update on and opportunity to discuss implementation of the 

Program. 

c) Updates to Department of Finance 

ARB shall forward semi-annual and project completion reports submitted by local 

agencies along to the Department of Finance. H&S §39625.02(f)(1)-(2). 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap II: ARB Program Administration 42 February 2008

d) ARB annual report 

ARB staff shall prepare an annual report on progress implementing the Goods 

Movement Emission Reduction Program once the Board has adopted the Program 

Guidelines and local agency projects have been selected for funding. Pursuant to H&S 

§39627.5, this report shall be submitted to the Legislature with the Governor’s proposed 

State budget for the ensuing fiscal year, by January 10, and shall include the following 

minimum elements: 

• Description of local agency projects funded by the Program, including the following 

information for each project: 

- Amount of Program funds allocated. 

- Location. 

- Implementation status. 

- The number of vehicles, pieces of equipment, ship berths, etc. expected to be 

updated. 

- Estimate of the emission reductions achieved or expected. 

• Total funds allocated, obligated, and expended under the Program to date by trade 

corridor and funding category. 

• Actions undertaken to ensure local agency funded projects are being implemented in 

a timely fashion and within the budget for Program funds. 

• Accomplishments and challenges in implementing the Program. 

7. Local agency non-performance 

Prior to implementing any of the non-performance provisions in this section, ARB staff 

shall make a reasonable effort to work with local agency staff to address and resolve 

any issues relating to Program implementation. 

a) Non-performance finding 

If ARB staff identifies instances of local agency non-performance, ARB staff shall issue 

a written non-performance finding to that local agency. 

Local agency non-performance includes, but is not limited to, issues with any one or 

more of the following areas: 

• Misuse of Program funds. 

• Funding of ineligible equipment projects or other items. 

• Failure to comply with the Program Guidelines or statutes. 

• Failure to meet schedule milestones identified in the grant agreement. 

• Failure to obligate or expend Program funds within established timelines. 

• Insufficient performance or widespread deficiencies with program oversight, 

enforcement, record keeping, contracting provisions, inspections, audit procedures 

or any other Program element as determined by ARB. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap II: ARB Program Administration 43 February 2008

• Exceeding administrative fund allotment. 

• Insufficient, incomplete, or faulty project documentation. 

• Failure to provide required documentation or reports requested by ARB, DOF, or 

other agencies in a timely manner. 

• Poor performance as determined by an audit conducted by ARB, DOF or other 

designated agency or contractor. 

b) Local agency appeal process 

Upon notification of a non-performance finding, local agency staff or management may 

request a meeting with ARB management to dispute or discuss the validity of the nonperformance finding. 

If the disagreement over the validity of the non-performance finding cannot be resolved 

at the management level, local agency management may appeal to the ARB Executive 

Officer or his designated representative, whose decision shall be final and binding. 

c) Remedies for non-performance 

(1) Local agency probation 

ARB staff shall consider a local agency on probation at the time a non-performance 

finding is sent to the local agency. 

The local agency on probation shall develop a corrective action plan that must be 

submitted to ARB within 30 days of receipt of the written non-performance finding from 

ARB. 

ARB shall approve or disapprove with recommendations the corrective action plan 

within 30 working days of receipt from the local agency. To be considered for approval, 

the corrective action plan must include adequate, expeditious, and enforceable 

commitments to address the specific non-performance problems, including timeframes 

to complete each commitment. 

If the corrective action plan is approved, ARB staff shall evaluate the local agency’s 

performance under the approved corrective action plan, including timelines, to 

determine whether the local agency met its commitments and fully addressed the issues 

for which it was placed on probation. ARB may also impose additional requirements, 

depending upon the scope or severity of the local agency’s non-compliance with 

Program requirements. 

No later than one year from the date the local agency is originally placed on probation, 

ARB shall do one of the following, whichever ARB in its sole discretion deems 

appropriate: 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap II: ARB Program Administration 44 February 2008

• Remove the local agency from probation designation. 

• Re-designate the local agency on probation for a period of up to one additional year. 

• Re-designate the local agency on probation for a period of up to one additional year, 

and require that all, or a portion of, the remaining unspent Program funds available 

for expenditure by ARB and/or the local agency plus any earned interest, revert back 

to the California Ports Infrastructure, Security, and Air Quality Improvement Account. 

ARB may also require local agencies on probation to comply with additional 

requirements or stipulations prior to future ARB expenditures under existing grant 

agreement(s) or prior to ARB consideration of future local agency applications from the 

local agency for Program funds. 

If the corrective action plan is disapproved by ARB with recommendations, the local 

agency shall have 30 days to revise the plan according to the recommendations and 

resubmit it to ARB. ARB shall approve the corrective action plan as re-submitted within 

30 days, or develop a recommendation to require that all, or a portion of, the remaining 

Program funds available for expenditure by ARB and/or the local agency plus any 

earned interest, revert back to the California Ports Infrastructure, Security, and Air 

Quality Improvement Account. 

ARB shall make information pertaining to a local agency’s probationary status available 

to the public. 

(2) Fund reversion 

Program funds automatically revert back to the California Ports Infrastructure, Security, 

and Air Quality Improvement Account under the following conditions: 

• Funds held by the ARB revert if ARB does not obligate funds or liquidate funds within 

the deadlines set forth in State law. 

• Funds held by a local agency revert if the local agency does not obligate funds within 

two years of executing a local agency project grant agreement with ARB, or expend 

funds within four years of obligation. A local agency may return unused funds ahead 

of the reversion deadline if the local agency concludes it cannot spend the funds for 

any reason. 

• Funds held by a local agency revert once the local agency withdraws from the 

Program or its grant agreement is terminated, irrespective of whether the funds have 

been obligated but not yet expended. 

 

All Program funds that revert back to the California Ports Infrastructure, Security, and 

Air Quality Improvement Account are subject to re-appropriation by the Legislature. 

ARB and local agencies are released from funding commitments in grant agreements or 

contracts, as applicable, for any and all funds that are reverted back to the California 

Ports Infrastructure, Security, and Air Quality Improvement Account. This release does 

not apply to any contractual obligations the local agency may have with the equipment 

owner or operators. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap II: ARB Program Administration 45 February 2008

(3) Future grant opportunities 

A local agency’s track record in administering Program funds shall be a factor in ARB’s 

consideration of subsequent applications from that local agency for future funds. 

ARB may require local agencies with a current or prior probation designation to comply 

with additional requirements or stipulations, prior to ARB consideration of future fiscal 

year Program funds. This may include: 

• Exclusion of a local agency from participation in the Program due to past nonperformance issues. 

• Based on the specific types and seriousness of a local agency’s past nonperformance issues, limitation(s) on future grant funding opportunities, levels, 

equipment project option(s), volume(s) or other limitation(s), as determined by ARB 

on a case-by-case basis. 

• The track record of the local agency may also be considered by ARB in conducting 

its audits of the local agency. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 46 February 2008

III. Local Agency Project 

A. Local Public Entity Registration 

Interested local public entities shall submit registration information as required by the 

Notice of Funding Availability (NOFA) sufficient for ARB to assess the entity’s 

qualification as a local public entity, by the deadline identified in the NOFA. Registration 

information shall include, at minimum, the following: 

• Type of agency (air district, seaport, transportation agency, etc.). 

• Jurisdiction, including geographic boundary and trade corridor. 

• Mission statement or purpose. 

• General information on the entity (total budget, overall work plan or program, etc.). 

• Certification that the local public entity has the legal authority to implement a 

regional scale incentive program for freight movement sources that includes: project 

solicitation, competition for funding, funding awards, execution of contracts, and 

equipment inspections across the entire trade corridor where the local public entity is 

based. 

• Local public entity contact information. 

To facilitate ARB review of a local public entity’s qualification as an applicant according 

to the requirements of the statute and the Guidelines, the entity shall submit 

concurrently with the registration: 

• A description of how the local public entity is involved in freight movement or air 

quality improvements associated with goods movement, as required by the statute. 

This description shall include entity’s specific roles, authorities, responsibilities, and 

annual budget for goods movement air quality projects. 

• A statement as to whether the local public entity fulfills the additional requirements of 

these Guidelines and further qualifies as an applicant because it: 

- Is directly responsible for operating a freight movement facility (e.g. seaport or 

airport); or 

- Has statutory authority for designing and implementing strategies and/or plans to 

reduce emissions or health risk from air pollution sources (e.g. local air pollution 

control district and air quality management district); or 

- Has statutory authority for planning and funding regional goods movement 

infrastructure projects (e.g. regional transportation planning agency). 

Local public entities shall provide any additional documentation not described above 

upon request by ARB. 

Local public entities shall successfully register with ARB staff prior to submittal of a 

project application packet. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 47 February 2008

B. Local Agency Project Application Packet 

Local public entities that have registered shall submit one completed local agency 

project application packet for each source category. Application packets shall be 

submitted to ARB by the NOFA deadline. The completed application packet shall 

include the following: 

• Completed application, including a written acknowledgement that ARB staff may prorate the proposed local agency project at a lower level of funding and proportionally 

lower performance measures (vehicles, equipment, harbor craft or berths to be 

updated; and the resulting emission reductions). 

• Local agency board/commission resolution (see Chapter III.B.4). 

On-line local agency project applications are scheduled to be available in time for the 

FY2007-08 funding cycle. If available, local agencies shall utilize the on-line application 

to submit local agency project application packets.

Local agency project applications are also subject to the statutory legal restrictions 

described below. 

1. Legal restrictions 

Local agencies shall certify that the local agency project would achieve emission 

reductions not otherwise required by law or regulation. H&S §39625.5(a)(1). "Not 

otherwise required by law or regulation" means the emission reductions are not required 

pursuant to any local, State, or federal law, rule, or regulation; any requirements 

imposed by the California Environmental Quality Act (CEQA); or any requirements 

imposed by a legal instrument such as a legal settlement or consent decree (collectively 

referred to as "law or regulation"). For purposes of this Program only, "not otherwise 

required by law or regulation" does not apply to any tariff, ordinance, or other 

requirement imposed by a local agency based on that agency's authority as a market 

participant or municipal proprietor or the agency's authority to enter into contracts with 

equipment owners and operators. 

The following are examples of laws or regulations that may prohibit equipment projects 

that would otherwise be eligible for funding under this Program. Sub-section (d) below 

discusses Program funding for equipment projects that may be subject to future ARB 

regulations. 

a) Environmental mitigation 

Local agencies shall not request or expend Program funds for equipment projects that 

are required as a specific California Environmental Quality Act (CEQA) or National 

Environmental Policy Act (NEPA) mitigation measure in a certified CEQA or NEPA 

document. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 48 February 2008

b) Railroad agreements 

For locomotives, the statute specifically requires ARB to determine that the emissions 

reductions that would be achieved by the locomotive equipment project are not 

necessary to satisfy any mandated emission reduction requirement under an agreement 

between a railroad company and a state or federal agency, or a local air district. H&S 

§39625.5(a)(2)(B). 

The Staff Report discusses two Memoranda of Understanding (MOU) that ARB has 

signed with the Class I railroads – Union Pacific and Burlington Northern-Santa Fe – to 

reduce the emissions and health risks from locomotive operations. Program funding 

shall not be used for idle reduction technology on locomotives (required by the 2005 

MOU) or for cleaner locomotives credited towards the railroads’ compliance with the 

2010 fleet average emission standard for the South Coast Air Basin (required by the 

1998 MOU). Locomotive repowers or replacements that go beyond the itemized 

requirements of these agreements shall be eligible for bond funding. 

c) Existing ARB regulations 

Local agencies shall not request or expend Program funds for equipment projects that 

are used to directly comply with existing regulations. The Program can co-fund eligible 

equipment subject to existing or future regulations, but only if the equipment upgrades 

are early (completed a set time prior to the compliance date) or extra (the upgrade must 

go beyond the regulatory requirements, as provided in these Guidelines). 

Existing ARB regulations that are currently in place for the following source categories 

applicable to this Program include, but are not limited to: 

• New heavy-duty diesel vehicles – Exhaust Emissions Standards and Test 

Procedures -1985 and Subsequent Model Heavy-Duty Engines and Vehicles (Code 

of Regulations, title 13, division 3, chapter 1 §1956.8). 

• Heavy-duty truck idling – Requirements to Reduce Idling Emissions From New and 

In-Use Trucks (Code of Regulations, title 13, division 3, §1956.8, §2404, §2424, 

§2425, §2485). 

• Cargo handling equipment – Regulation for Mobile Cargo Handling Equipment at 

Ports and Intermodal Rail Yards (Code of Regulations, title 13, division 3, chapter 1 

§2479). 

• Ships at berth (shore power) – Operational Hour Limits and Other Requirements for 

Auxiliary Diesel Engines Operated on Ocean-Going Vessels At-Berth in a California 

Port. (Code of Regulations, title 13, division 3, chapter 5.1, §2299.3). 

• Commercial harbor craft engines – Emission Limits and Requirements for Diesel 

Engines on Commercial Harbor Craft Operated Within California Waters and 24 

Nautical Miles of the California Baseline. (Code of Regulations, title 13, division 3, 

chapter 1, article 4.5 §2299.5). 

• Trucks serving ports and intermodal rail yards – Regulation to Control Emissions 

from In-Use On-Road Diesel-Fueled Heavy-Duty Drayage Trucks. (Code of 

Regulations, title 13, division 3, chapter 1, article 3 §2027). 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 49 February 2008

• Truck smoke and emission control inspections – Heavy-Duty Diesel Smoke 

Emission Testing, and Heavy-Duty Vehicle Emission Control System Inspections. 

(Code of Regulations, title 13, division 3, chapter 3.5, §2180-2194). 

Information regarding existing ARB regulations for specific source categories can be 

found on the following ARB website: http://www.arb.ca.gov/diesel/mobile.htm, or in the 

California Code of Regulations through the Office of Administrative Law (OAL): 

http://www.oal.ca.gov/ccr.htm. 

d) Upcoming ARB Regulations 

Local agencies may request and expend Program funds for equipment upgrades that 

may be required by a future ARB regulation up until the date of Board action to adopt 

the regulation. 

As of the date of Board action, only equipment projects with executed contracts 

between the equipment owner and local agency shall be exempt from project 

completion timing requirements (e.g., three years prior to the adopted regulatory 

compliance date for that equipment upgrade). 

Once the Board has taken action to approve a regulation, subsequent equipment 

projects shall be subject to the project completion timing requirements identified in the 

equipment project specifications or include emission reductions that go beyond the 

regulatory requirements. For example, port truck replacements with model year 2007 or 

newer trucks must be completed three years prior to the regulatory requirement for this 

replacement. 

Information regarding upcoming ARB regulations for specific source categories can be 

found on the following ARB website: http://www.arb.ca.gov/diesel/mobile.htm. 

Local agencies are encouraged to pay specific attention to the ongoing development of 

the Proposed Regulation to Reduce Emissions of Diesel Particulate Matter, and Other 

Pollutants From In-Use Heavy Duty Diesel-Fueled Vehicles, which may impact a 

significant number of Program-eligible truck projects. 

2. Project alternatives for local agencies 

Under this Program, a “local agency project” is defined as the source category-specific 

incentive program that the local agency proposes to implement with Program funding. 

This section lists the alternatives that a local agency may and may not propose to make 

to the specifications for each equipment project option described in these Guidelines. If 

a local agency wants to implement one or more acceptable alternatives, the local 

agency shall clearly describe the alternative(s) for each equipment project option in the 

local agency application, along with the basis for the alternative(s) proposed. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 50 February 2008

ARB staff may, at its discretion, expand the following list of alternatives to include 

additional items that do not fundamentally alter the equipment project eligibility criteria, 

the equipment project requirements and operating conditions, or the effectiveness of 

those provisions in reducing emissions. 

a) Technology alternatives 

The local agency may propose to customize its source-category specific proposal by 

incorporating any of the following alternatives: 

• Within a source category, a local agency may propose to implement one or more of 

the equipment project options defined in these Guidelines. The local agency shall 

identify each desired equipment project option on the local agency project 

application. If the local agency is requesting funding for multiple equipment project 

options within a source category, the local agency shall describe each option and 

itemize the associated emissions, reductions, costs, Program funding requested, 

and cost-effectiveness for each option within the application. If that local agency 

project is funded, ARB will expect the local agency to solicit applications for the 

proposed equipment project options, and then evaluate and competitively rank all of 

the applications within the source category against each other. Because of the need 

for competition across equipment project options, the final mix of equipment projects 

funded by the local agency may differ from the local agency project application. 

• Within an equipment project option, a local agency may propose to offer nonProgram funding for equipment that meets an emissions performance standard that 

requires lower emissions than the specifications in these Guidelines, provided the 

technology to meet that standard is demonstrated, verified by ARB (if applicable) 

and commercially available. The local agency shall not propose to offer Program 

funding at a level for each equipment project that exceeds the funding caps in these 

Guidelines. The local agency shall not require equipment meeting lower emission 

standards than the emissions levels for the equipment project options in these 

Guidelines. The local agency shall not propose to restrict eligibility for Program 

funding to equipment projects that utilize the additional funding to meet the lower 

emission standards (i.e., any equipment project that meets the minimum 

specifications established in these Guidelines must be eligible to compete for 

Program funding administered by the local agency for that equipment project option). 

For example, a local agency may propose a truck retrofit program that does not 

require but offers additional funds for both diesel PM and NOx controls; with the 

Program paying $5,000 per truck towards the PM control element and the local 

agency providing supplemental funding from another, non-State source for the 

additional NOx control. Following ARB approval of the local agency project, the 

local agency shall solicit equipment applications for both the lower emission PM/NOx 

retrofit approach as well as the truck retrofit approach listed in the program 

Guidelines. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 51 February 2008

Similarly, a local agency could propose a truck program that does not require but 

offers additional funds for replacement with natural gas; with the Program paying up 

to the maximum $50,000 per truck and the local agency providing funding from 

another, non-State source for the incremental cost of natural gas. Following ARB 

approval of the local agency project, the local agency shall solicit equipment 

applications for both the lower emission natural gas replacement approach as well 

as the truck replacement approach listed in the program Guidelines. 

• Within an equipment project option, a local agency may propose to offer nonProgram funding for equipment monitoring or tracking devices (like global positioning 

systems or radio-frequency identification devices). In this case, the local agency 

shall commit to monitor the equipment for the project life. The local agency shall 

also make provisions acceptable to ARB for access to the data collected on 

individual vehicles, vessels or equipment and periodic data reports. 

• Within an equipment project option, a local agency may propose to offer nonProgram funding for efficiency upgrades, like aerodynamic devices on trucks. 

b) Project implementation approaches and contractors 

A local agency project implementation approach is defined as the mechanism(s) a local 

agency may propose to implement a local agency project. For example, as part of a 

single local agency project, an air district may propose to directly administer grants to 

truck owners for replacement projects and to hire a contractor or other third party to run 

a truck retrofit program. Each of these is an implementation approach. 

The local agency may propose to customize its source-category specific proposal by 

incorporating any of the following alternatives: 

• Within a source category or an equipment project option, a local agency may 

propose a combination of implementation approaches to target recruitment of 

eligible projects and administration of funds for selected projects. The local agency 

may also apply for Program funds to be administered in full or in part by a third party 

contractor or contractors, but shall retain full responsibility for the Program 

requirements and deadlines specified in these Guidelines and executed grant 

agreements with ARB. Any third party overhead and administration costs shall 

count against the cap established in the Guidelines for local agency administration 

funds. 

Regardless of the local agency’s use of multiple implementation approaches or third 

party contractors, the competitive ranking process must take place across the entire 

source category to ensure fair and equitable competition between eligible equipment 

projects. The local agency shall not commit or obligate Program funds to specific 

project implementation approaches or third party contractors prior to the completion 

of the competitive ranking process. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 52 February 2008

For example, as part of a single local agency project, a port may propose to employ 

three contractors to run truck replacement programs – one focused on a lease-toown program for diesel trucks, one on leasing natural gas trucks, and one on 

offering grants to truck owners for purchase of new trucks. These contractors can 

each market their project implementation approach and solicit applications for 

eligible truck projects, consistent with the Guidelines and local agency project grant 

agreement. The port must then competitively rank the applications from all three 

contractors together to determine which specific equipment projects will be funded. 

The contractors can then administer the funding for the equipment projects selected 

from the competitive process. 

c) Procedure/process alternatives 

The local agency may propose to customize its source-category specific proposal by 

incorporating any of the following alternatives: 

• Within an equipment project option, a local agency can shorten the time allowed 

from execution of the equipment project contract to project completion. Staff 

recommends that local agencies carefully consider the potential of this alternative to 

increase fund reversion due to non-performance. The local agency shall not 

propose or allow equipment projects to be completed less time in advance of a 

regulatory requirement than provided for in the project specifications. 

• Within a source category or equipment project option, a local agency can expand the 

list of information required on an equipment project application or the reporting 

requirements for equipment owners. 

• Within a source category or equipment project option, a local agency can expand the 

equipment inspection or scrappage requirements. 

d) Geographic operations 

For clarity, this section describes both the geographic requirements that a local agency 

must implement and the specific situations where the local agency may propose to 

customize its source-category specific proposal by incorporating geographic 

alternatives. ARB staff expects that local agencies will propose to administer local 

agency projects for equipment that operates in the trade corridors, including the corridor 

where the local agency has jurisdiction. 

These Guidelines limit eligibility for Program funds to equipment with recent operation in 

one or more trade corridors. Except as provided below, a local agency may not 

propose or implement a local agency project that restricts access to Program funding to 

equipment operating at a single facility or within a single city, county, air district, air 

basin, trade corridor, or similar geographic area that is smaller than the four trade 

corridors or the State of California. 

 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 53 February 2008

• Trucks serving ports. A local agency that applies for funds to administer a retrofit, 

repower, or replacement program for port trucks may propose to restrict eligibility to 

trucks serving one or more major seaports in the trade corridor where the local 

agency has jurisdiction. The local agency shall specify which seaport(s) the 

proposed project would cover and the estimated number of eligible trucks serving 

that seaport. The local agency shall recruit all eligible trucks serving the specified 

seaport(s), regardless of where in California the trucks are based. The local agency 

shall similarly fund eligible trucks serving the specified seaport(s), subject to review 

of equipment project applications and the competitive ranking process. 

• Trucks serving intermodal rail yards. A local agency that applies for funds to retrofit, 

repower, or replace trucks serving intermodal rail yards must recruit all eligible trucks 

serving intermodal rail yards that are located in the trade corridor where the local 

agency has jurisdiction and covered by ARB’s December 2007 rule. The local 

agency shall similarly fund all eligible trucks serving intermodal rail yards in the 

corridor, subject to review of equipment project applications and the competitive 

ranking process. 

• Other trucks. A local agency that applies for funds to retrofit, repower, or replace 

other trucks, or to implement a three-way transaction shall recruit eligible trucks that 

travel within the trade corridor where the local agency has jurisdiction. The local 

agency shall accept applications and fund all eligible trucks that travel within the four 

trade corridors, regardless of where those trucks are based, subject to review of 

equipment project applications and the competitive ranking process. A local agency 

may propose to add an eligibility requirement that the old truck must have traveled at 

least 10% of its annual miles within the trade corridor where the local agency has 

jurisdiction. This requirement would be added to the base Program requirements 

that both the old and new trucks travel at least 50% of their annual miles within the 

four trade corridors, and that the new trucks travel 100% of their miles in California. 

• Switcher locomotives. A local agency that applies for funds to repower or replace 

switcher locomotives may require that both the old and new switcher locomotive 

operate full-time within the trade corridor where the local agency has jurisdiction, 

except for periodic maintenance in another region or neighboring state. 

• Line-haul locomotives. A local agency applies for funds to repower or replace linehaul locomotives may require that both the old and new line-haul locomotive operate 

at least 10% of the time in the corridor where the local agency has jurisdiction, and 

full-time within California, except for periodic maintenance in a neighboring state. 

The local agency shall recruit all eligible locomotives operating in the trade corridor, 

regardless of where in California the locomotives are based. The local agency shall 

similarly fund all eligible line-haul locomotives serving that trade corridor and others, 

subject review of equipment project applications and the competitive ranking 

process. 

• Harbor craft. A local agency that applies for funds to administer a harbor craft 

repower or replacement program may propose to restrict eligibility to vessels that are 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 54 February 2008

home-ported in the trade corridor where the local agency has jurisdiction. The local 

agency shall specify which seaport(s) the proposed project would cover and the 

estimated number of eligible harbor craft serving that seaport, including the number 

of craft that are subject to ARB’s November 2007 commercial harbor craft regulation. 

• Shore power. A local agency that applies for funds to administer a shore power 

program may restrict eligibility to one or more seaports within the trade corridor 

where the local agency has jurisdiction. The local agency shall specify which 

seaport(s) the proposed project would cover and the estimated number of berths at 

each seaport that are subject to ARB’s December 2007 regulation for ocean-going 

vessels at dock. 

 

• Cargo handling equipment. A local agency that applies for funds to administer a 

cargo handling equipment program to install energy storage systems on rubber-tired 

gantry cranes may restrict eligibility to equipment operating at one or more seaports, 

or all intermodal rail yards, within the trade corridor where the local agency has 

jurisdiction. 

• Truck stop or distribution center electrification. A local agency that applies for funds 

to administer a program for electrification infrastructure to reduce engine idling and 

use of internal combustion auxiliary power systems at truck stops, intermodal 

facilities, distribution centers, and other places where trucks congregate may restrict 

eligibility to facilities within the trade corridor where the local agency has jurisdiction. 

The local agency shall recruit all eligible truck stops and distribution centers 

operating in the trade corridor and shall similarly fund all eligible projects within that 

trade corridor, subject to review of equipment project applications and the 

competitive ranking process. 

e) Ineligible project alternatives 

A local agency shall not propose or implement other requirements that are inconsistent 

with these Guidelines including, but not limited to: 

• A local agency shall not restrict funding eligibility to a preferred individual, company, 

business entity, or other defined group of equipment owners. Other than the 

exceptions specifically described above, a local agency shall not restrict funding 

eligibility to equipment that operates solely or primarily within its jurisdictional 

boundaries. The local agency shall solicit, accept applications, and fund equipment 

projects from all equipment owners who meet the eligibility requirements defined in 

these Guidelines, subject to the local agency project described in the grant 

agreement as well as the project evaluation and competitive ranking process. 

Notwithstanding the above, a local agency may exclude from funding eligibility any 

equipment owner who has a demonstrated inability to meet contractual obligations 

with the local agency. 

• A local agency shall not restrict equipment projects to replacement or retrofit 

equipment manufactured or sold by a single company. The local agency shall allow 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 55 February 2008

all eligible equipment projects that meet the emissions performance level detailed in 

the project specifications of these Guidelines to compete for Program funding. 

• A local agency shall not impose travel restrictions on Program-funded equipment 

beyond the operating limitations defined in these Guidelines and any approved 

alternatives described in the preceding section. For example, a local agency cannot 

restrict the travel (or a portion of the travel) of trucks or line-haul locomotives to 

within a single city, county, air district, air basin, trade corridor, or similar geographic 

area that is smaller than the four trade corridors or the State of California. 

• The local agency shall not fund equipment projects failing to meet the minimum 

equipment project requirements listed in Appendices A-G of these Guidelines. In 

conjunction with the minimum equipment project requirements, a local agency shall 

not fund higher emitting equipment, pay more per piece of equipment, modify the 

project life options, remove the project eligibility and other requirements, or relax the 

operating conditions as compared to the specifications in these Guidelines for each 

equipment project option. 

3. Completed application 

Local agencies shall complete a local agency project application, and submit it with an 

original signature by an authorized local agency representative. 

All application information shall be provided or the application shall be considered 

incomplete. Updates to any application information after the submittal deadline shall 

only be allowed on a case-by-case basis, at the discretion of ARB staff. 

The local agency project application shall include, at minimum, the following 

information. 

a) General local agency information 

The local agency shall include general information about the local agency consisting of, 

at minimum, the following: 

• A general description of the local agency, its geographic boundaries, regional 

demographics and statistics, agency roles and functions, and its relationship to 

goods movement and air quality. 

• A description of the local agency’s experience administering other incentive 

programs. If the local agency has implemented more than one type of incentive 

program, describe the program that is most similar to the source category that is 

being applied for first; then any other incentive programs. At minimum, the 

description of prior experience shall include: 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 56 February 2008

o Purpose of the incentive program (equipment upgrades, new technologies, etc.) 

o How long the local agency has administered the program. 

o Annual funding amounts. 

o Description and quantification of the equipment purchased through the program. 

o Successful outreach strategies used to solicit participation. 

o Overview of the monitoring and reporting under the program. 

• Staff contact information. 

• Other general information as requested on the online application. 

b) Local agency project proposal 

The local agency shall include information about the local agency’s proposed local 

agency project. The local agency shall, at a minimum: 

• Identify the trade corridor(s) targeted. 

• Describe the air quality problems and key contributing pollutants in the trade 

corridor. 

• Identify the source category. 

• Identify the specific equipment project options targeted, along with all equipment 

project assumptions necessary to calculate project benefits as described below. 

• Identify any proposed local agency project implementation approaches. 

• Identify and detail any proposals to allow lease-to-own programs. 

• Identify any proposed project alternatives consistent with Chapter III.B.2. 

• Describe how the local agency project is consistent with local and regional plans to 

reduce emissions from goods movement activities, or consistent with the regional 

strategies in ARB’s 2006 Emission Reduction Plan for Ports and Goods Movement 

in California. At minimum, this description shall include the strategies or measures 

identified in these goods movement plans that are addressed by the local agency 

project proposal. 

c) Air quality benefits 

The local agency shall use the Project Benefits Calculator provided by ARB to quantify 

the emission reductions and cost-effectiveness of a proposed local agency project (see 

the Program website at: http://www.arb.ca.gov/gmbond). If a local agency identifies an 

eligible local agency project that cannot be quantified with the Project Benefits 

Calculator for that source category, the local agency should contact ARB staff for 

guidance. 

If the proposal includes multiple equipment project options, the local agency shall 

quantify and report the emission reductions, costs, and reductions per State dollar 

separately for each, as well as the total for the source category. 

If a local agency is seeking funding for implementation approaches for a single 

equipment project option (for example, three distinct truck replacement programs run by 

different contractors with different levels of State funding and/or different emission 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 57 February 2008

performance levels), the local agency shall quantify and report the emission reductions, 

costs, and reductions per State dollar separately for each approach, as well as the total 

for the equipment project option. 

d) Project schedule 

The local agency shall include a detailed local agency project schedule. At minimum, 

the local agency project schedule shall provide either the anticipated date or the 

approximate number of weeks necessary to accomplish each of the milestones 

identified below. 

The local agency project schedule shall incorporate local agency obligation and 

liquidation deadlines identified in Chapter III.E.1 & 2. 

The local agency project schedule shall include, but is not limited to: 

• Date of community participation event (see Chapter III.D.1). 

• Anticipated (ARB) Board approval of local agency projects (see NOFA, when 

published). 

• Anticipated execution date of local agency project grant agreement. 

• Anticipated date of initial grant expenditure request to ARB and amount. 

• Equipment project solicitation period, including marketing/outreach. 

• Equipment project application review period. 

• Competitive ranking of equipment projects and webposting. 

• Selection of equipment projects from the competitively ranked list. 

• Anticipated date of next grant expenditure request to ARB and amount. 

• Equipment owner notification period. 

• Equipment pre-inspection period (as applicable). 

• Local agency obligation deadline (all contracts must be signed). 

• Equipment post-inspection period. 

• Local agency liquidation deadline (all equipment funds must be liquidated). 

• Anticipated submittal of local agency project completion report. 

e) Funding demonstration 

The local agency shall include a funding demonstration for each local agency project. 

Elements of funding demonstration. This funding demonstration shall include, but is not 

limited to: 

• The total cost of the local agency project. For grid-based shore power projects and 

harbor craft projects, the local agency may estimate the total cost of the project in the 

anticipated completion year. 

• The amount of Program funds requested from ARB, including the breakdown of 

equipment project funds and administration funds, subject to the limits in these 

Guidelines. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 58 February 2008

• The specific sources of the matching funds (private, local, other State, federal). If a 

local air district proposes to co-fund truck projects with the monies derived from the 

$2 surcharge on vehicle registration fees authorized by AB 923 (Chapter 707, 

Statutes of 2004), these monies must be identified as other State funds in this 

demonstration. 

• For each source of match funding, the amount, any conditions or restrictions 

associated with its use, as well as any timeframe requirements associated with its 

expenditure. 

• A demonstration that all non-Program match funds are reasonably available within 

the timeframes of the local agency project schedule. 

• Documentation of the local agency’s fiscal ability to implement the proposed local 

agency project. 

• A copy of the local agency’s most recent final fiscal audit. 

Administration funds. Local agencies with the ability to generate new funding from 

goods movement sources to cover administration funds (e.g. seaports) shall be 

prohibited from requesting administrative Program funds. 

In all other cases, requests for administration funds are capped as follows: 

• 2% of the grant amount for grid-based shore power.

• 3% of the grant amount for locomotives, cargo cranes, truck stop/distribution center 

electrification, and non-grid shore power. 

• 4% of the grant amount for harbor craft. 

• 5% of the grant amount for trucks. 

Administration funds shall be used for tasks associated with Program 

outreach/marketing, implementation, and audit and oversight, including: staff time; 

consultant fees; printing, mailing, and travel costs; project monitoring and compliance 

expenses; and indirect costs, such as general administrative services, office space, and 

telephone services. 

f) Staff resources 

The local agency shall identify and describe the staff resources necessary to effectively 

implement the local agency project proposal. This includes documentation of existing 

and planned staffing, with an indication of when planned staff will be hired. 

The local agency shall affirmatively demonstrate that the agency has or will have the 

necessary resources in place to meet the demands of the project type and scope. 

Agencies with prior experience implementing diesel engine or other incentive programs 

should provide documentation on their own statistics regarding the relationship between 

the number of pieces of equipment that can upgraded in a given timeframe and the 

number of program staff needed to accomplish those upgrade projects. Agencies 

without prior experience should contact the local air district in the region to obtain 

relevant statistics. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 59 February 2008

The staff resources demonstration shall include the following minimum documentation: 

• Description of the local agency’s staffing levels and experience in administering 

other incentive program funds (if applicable). 

• Description of the basis for the proposed staffing levels if the local agency does not 

have prior incentive program experience. 

• Description/list of the staff classifications that are available or will be available to 

implement the project, including: 

- At least one supervisor/manager to oversee the local agency project. 

- Program staff to solicit, evaluate, competitively rank, inspect, fund, and audit 

equipment projects; as well as prepare database updates and reports. 

- Other staff in the following categories: 

o Field inspectors for equipment inspections. 

o Fiscal/accounting staff. 

o Computer assistance/database management staff. 

o Legal staff. 

o Clerical support staff. 

o Temporary staff (students, limited term, etc.). 

g) Local agency project implementation demonstration 

The local agency shall describe in detail how it will implement the local agency project 

to demonstrate its ability to fully and effectively satisfy each of the proposed local 

agency project implementation requirements detailed in Chapter III of these Guidelines. 

Local agencies currently administering incentive programs similar to this Program may 

use existing policies and procedures that are modified to reflect the unique 

requirements of this Program. 

This demonstration shall include a description of how the local agency will structure its 

program to meet each requirement summarized below; including substantive detail 

(wherever possible) regarding the procedures the agency will use to implement each 

provision. 

• Support public participation. 

• Conduct marketing and solicit equipment project applications (including targeted 

outreach and assistance to independent truck owner-operators). 

• Review and competitively rank project applications (including web posting). 

• Select equipment projects for funding (including any local board/commission 

process). 

• Conduct equipment pre-inspections and compliance checks. 

• Notify equipment owners of the status of their application. 

• Execute equipment project contracts. 

• Ensure equipment scrappage where required. 

• Conduct post-inspections of new or upgraded equipment. 

• Request expenditures from ARB. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 60 February 2008

• Process invoices and requests from equipment owners for payment (including direct 

payments to vendors and reimbursements). 

• Calculate and report earned interest. 

• Evaluate equipment projects and assess on-going compliance with contract 

conditions. 

• Provide required reports to ARB (including the ability to submit equipment project 

data electronically when requested). 

• Participate in Program and fiscal audits. 

This demonstration shall also be evidence of the local agency’s ability to deliver the 

proposed project scope (see Chapter II.D.4) and its readiness to quickly begin 

implementation and deliver air quality results (see Chapter II.B.3). 

4. Local agency board/commission resolutions 

The local agency shall include a resolution of the local agency governing board or 

commission that authorizes the local agency to enter into a local agency grant 

agreement with ARB, accept funds, and provide any matching funds under the fiduciary 

control of the local agency that are identified in the local agency project funding 

demonstration. 

The local agency resolution shall also clearly identify the local agency’s 

board/commission role or board/commission delegations to local agency staff for the 

following: 

• The local agency representative authorized to sign and submit the local agency 

project application. 

• The local agency representative authorized to sign/execute a local agency project 

grant agreement between ARB and the local agency. 

• The approval of a competitively ranked equipment project list indicated the 

equipment projects selected for funding and a backup list of eligible equipment 

projects. 

• The local agency representative authorized to sign/execute an equipment project 

contract between the local agency and equipment owner. 

C. Local Agency Project Grant Agreement 

Local agency project grant agreements and requirements are described in Chapter 

II.D.10 above. 
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Chap III: Local Agency Project 61 February 2008

D. Local Agency Project Implementation Requirements

1. Community and public participation 

a) Community meetings 

For FY2007-08 funds, the local agency shall hold at least one community meeting prior 

to the submittal of the local agency project application to solicit public input on the 

source categories and equipment project options to be addressed in the local agency 

project proposal. The local agency shall consider public input as it develops the local 

agency project application. In subsequent funding cycles, the local agency shall expand 

the opportunities for community participation in the development of the application. 

At minimum, the local agency project application shall identify when and where the 

community meeting(s) was held, and include documentation of the attendance and a 

brief summary of the comments received. 

The local agency shall also commit to co-hosting with ARB staff at least one community 

meeting in the trade corridor each year to provide updates on the implementation of the 

local agency project. 

b) Public and interested stakeholder participation 

The local agency application shall include a description of the local agency’s strategy for 

involving the public and interested stakeholders during the implementation of the 

proposed local agency project. 

The local agency shall identify mechanisms for the public to provide input to the local 

agency on the equipment project solicitations, the competitively ranked list of equipment 

projects, the periodic progress reports, and the equipment project status updates on the 

ARB website (and the local agency website, if applicable). 

c) Public website 

The local agency shall maintain a public website containing, at minimum, the following 

information: 

• A link to ARB’s Program website (http://www.arb.ca.gov/gmbond). 

• Information pertaining to equipment project solicitations. 

• The competitively ranked equipment project list(s) when available. 

To enhance outreach efforts and program transparency, the local agency shall submit a 

website link to ARB containing specific local agency program information, including 

information on community meetings or public workshop announcements which will then 

be posted on ARB’s Goods Movement Emission Reduction Program website. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 62 February 2008

2. Equipment project marketing tools 

The local agency shall use marketing strategies that specifically target the owners of 

Program eligible equipment covered by the local agency project, and operating in the 

trade corridor (regardless of where that equipment is based.) 

Local agencies shall provide technical and administrative assistance to equipment 

project applicants to help them understand and apply for equipment projects. 

 

a) Marketing tools 

Local agencies shall identify and use at least three marketing tools (more are 

encouraged, but not required). Examples include: 

• Develop and maintain list of interested parties. 

• Use web-based marketing. 

• Advertise and post announcements in local newspaper(s), including non-English 

publications. 

• Use radio advertisements. 

• Issue public notices. 

• Distribute brochures/fact sheets/community newsletters. 

b) Outreach to independent truck owner/operators

For truck programs, the local agency shall design and implement a targeted outreach 

program for independent owner/operators to inform them about Program funding 

opportunities and to assist them in completing equipment project applications. This 

information shall include, at a minimum, the Program funding available, equipment and 

operating requirements, and application deadlines. Marketing tools to reach this 

audience may include, but are not limited to: 

• Education and application assistance via a kiosk set up near a location where 

independent truck drivers congregate. 

• Outreach during typical off-times for truck drivers. 

• A toll free number for equipment project applicants to check the status of applications 

or get phone assistance in completing an application. 

• A notice in local papers or other written material of funding availability (including 

papers published in languages other than English). 

c) Information on truck efficiency upgrades 

For truck programs, the local agency shall make information available to equipment 

owners regarding upgrades to improve fuel efficiency, especially for long-haul trucks. 

Technologies that improve fuel efficiency for trucks may include devices that reduce 

aerodynamic drag and rolling resistance. Aerodynamic drag may be reduced using 

devices such as cab roof fairings, cab side gap fairings, cab side skirts, and on the 

trailer side, trailer side skirts, gap fairings, and trailer tail. Rolling resistance may be 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 63 February 2008

reduced using single wide tires or low-rolling resistance tires and automatic tire inflation 

systems on both the tractor and the trailer. These upgrades offer the potential to cut 

emissions of greenhouse gases and criteria pollutants, with a two to three year payback 

period through lower fuel costs. The benefits are variable based on the type of truck 

operations. 

Truck owners may be interested in including efficiency upgrades that fit their operating 

profile when purchasing a new truck or retrofitting a PM filter with bond funding under 

this Program. While this Program does not provide funding for the efficiency upgrades, 

other incentive programs may help offset the purchase cost or help finance the 

purchase of the upgrades. For example, U.S. EPA in collaboration with the freight 

industry has developed the SmartWay Transport Partnership to increase energy 

efficiency while significantly reducing greenhouse gases and criteria pollutants. This 

program also designates technology packages as SmartWay Upgrade Kits, which can 

be purchased at various SmartWay partner centers, dealerships, and service centers. 

(http://www.epa.gov/otaq/smartway/documents/420f07027.htm ) Some California air 

districts are working to expand this program in California. 

ARB is developing a regulation for truck efficiency upgrades to cut greenhouse gases, 

for consideration by the Board in 2008. 

d) Outreach to small businesses for infrastructure construction

AB 761 (Chapter 611, Statutes of 2007) imposes requirements on State agencies 

awarding bond-funded contracts to encourage the participation of small businesses in 

the construction of the State’s infrastructure. Government Code Section 14838.1. 

Under SB 88, ARB cannot directly award contracts to build infrastructure under the 

Goods Movement Emission Reduction Program and is therefore not subject to the 

requirements of AB 761. However, ARB can impose requirements to meet the spirit of 

the law when it provides funds via grant agreements to local agencies to build the 

electric infrastructure to support both grid-based shore power for ships at berth and 

electric truck pedestals at truck stops or distribution centers. 

For grid-based shore power and truck stop/distribution center electrification projects, the 

local agency shall design and implement a targeted outreach program to encourage 

small businesses to participate in the construction, alteration, demolition, repair, or 

improvement of the project infrastructure funded by the bond Program. Outreach shall 

include advertising opportunities to bid for projects (as applicable), providing the bidding 

procedures, and providing California small businesses with information on available 

training and technical assistance for understanding and bidding on contracts. 

A local agency that receives funding for these equipment project types shall keep 

statistics on small business and microbusiness participation in any contracts for this 

equipment installation. The local agency shall include these statistics in project data 

updates and reports to ARB. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 64 February 2008

3. Local agency solicitation of equipment projects 

A local agency may include provisions for more than one solicitation for each Program 

grant. If multiple solicitations are conducted, they shall not occur until equipment project 

applicants in the prior solicitation are notified of the results of their applications. 

The documentation on the solicitation process shall include, but is not limited to, the 

following: 

• Start and end dates for the equipment project application period. 

• A list of materials in the information packet (see below). 

• A solicitation schedule with milestones. 

The local agency shall make an information packet available to equipment owners who 

may be interested in applying for funding. This packet shall include the equipment 

project application, plus materials that describe all of the following: 

• Application submittal information (how, where, by when, to whom). 

• The Program and purpose for the solicitation. 

• The equipment eligible for Program funding, including equipment project 

requirements and conditions (e.g. equipment inspections and any associated 

requirement for the equipment owner to bring equipment to a designated location, 

100% California operation, scrap old equipment, legally binding contract and 

contract terms, etc.). 

• Limits on available funding per piece of equipment. 

• Equipment application disclosure language, and clear statement that new equipment 

funded by this program can only be purchased or ordered once the contract is 

signed between the equipment owner and local agency. 

• The equipment project review and competitive ranking process for equipment 

projects. 

• The payment process, including invoice payments and direct payments to vendors 

(as applicable). 

• Remedies for contract non-performance. 

• The reporting requirements. 

• The ongoing equipment evaluation and auditing process. 

4. Review of equipment project applications 

The local agency shall review equipment project applications for eligibility and content, 

including whether an application is submitted in good faith, credible, or in compliance 

with the Program Guidelines. 

At minimum, the local agency review of equipment project applications shall include: 

• Assignment of a unique equipment project number for tracking purposes as 

specified by ARB staff. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 65 February 2008

• Verification of the equipment owner’s eligibility to participate in the Program. 

• Verification that the proposed equipment project is consistent with the Guidelines. 

• Determination that all data and information necessary to calculate benefits and costs 

consistent with approved ARB methods are included. 

5. Match funding for equipment projects 

Local air districts cannot combine funding from this Program and direct funding from the 

Carl Moyer program on the same equipment project (i.e., funds directly authorized 

under H&S §44091.1(a) and Public Resources Code §42889). 

In response to air district requests, ARB staff has evaluated whether some “passthrough” vehicle registration fees that can be used in the Carl Moyer program may also 

be used for match funding under this Program. Under AB 923 (Chapter 707, Statutes of 

2004), the $2 surcharge on the vehicle registration fee can be used for match funding of 

Proposition 1B projects involving the accelerated retirement, repowering, or retrofitting 

of trucks. Conversely, the $2 surcharge cannot be used under this Program for match 

funding on non-motor vehicle sources, such as locomotives, harbor craft, cargo ships, 

and off-road cargo equipment. 

Program funds and the $2 surcharge may be combined on the same equipment project 

if all of the following conditions are met: (a) the equipment project option(s) to be 

funded includes only trucks, (b) the equipment project meets both bond Program 

eligibility requirements and Carl Moyer funding criteria, (c) the equipment project does 

not exceed the Carl Moyer Program cost-effectiveness limit, with the project cost 

including both Program and AB923 funds, and (d) the $2 surcharge funds are not 

counted as part of an air district’s Carl Moyer match requirement. 

For the purpose of competitively ranking local agency and equipment projects under this 

Program, the calculation of reductions per State dollar invested must treat both bond 

Program monies and the $2 surcharge monies as State funds since the surcharge 

monies would otherwise be used in the Moyer Program. 

6. Competitive ranking and selection of equipment projects 

Local agencies shall use a quantitative approach to develop a competitively ranked list 

of eligible equipment projects. This process will be applied to competing equipment 

projects within each trade corridor, source category, and funding category. The 

following procedures for local agencies to rank and select equipment projects are based 

on the quantitative process ARB will use to competitively rank and select local agency 

projects. Chapter II.D.6 provides additional explanation of the elements of this process 

and Figure 1 in that section illustrates how the competitive process works. 

The competitive ranking shall be quantitative based on multiple factors – emission 

reductions and a measure of cost-effectiveness that considers match funding. The 

calculation of emission reductions uses the Carl Moyer program protocol of weighting 

combustion PM emissions (essentially diesel PM) by a factor of 20 relative to other 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 66 February 2008

pollutants to account for the greater health impacts of PM per ton of emissions. This 

protocol helps target Program funding to the projects that will achieve the greatest 

reduction in health risk. 

The local agency shall publish the list of competitively ranked projects on the agency 

website and provide a link to ARB’s Program website. 

a) Emission reduction score 

For each equipment project within a source category, the local agency shall review the 

equipment owner’s estimate of the total pollutant-weighted emission reductions in 

California, over the project life, based on the Project Benefits Calculator. 

Emission reductions = Reduction in NOx + (combustion PM x 20) emissions in 

California over the project life in pounds 

The local agency shall list all equipment projects within the same source category and 

eligible under the same local agency project grant agreement, in descending order of 

emission reductions, with the greatest emission reductions on top and the lowest 

emission reductions on the bottom. The agency shall number or score each project 

starting at the bottom with a score of 1 and continuing consecutively to the top project. 

For example, if there are 8 project proposals, the one with the greatest emission 

reductions would receive a score of 8. 

 

Emission Reduction Score = number from above evaluation 

b) Cost-effectiveness and match score 

For each equipment project within a source category, the local agency staff shall review 

the equipment owner’s estimate of the total pollutant-weighted emission reductions in 

pounds (as determined above), divided by the total State funding proposed for the 

project. Total State funding includes requested Program funds, plus any other State 

dollars – see discussion under Chapter II.D.5 Match Funding, on treatment of the $2 

vehicle registration fee surcharge under AB 923 as State dollars. 

Cost-effectiveness and match = weighted emission reductions (lbs)/total State $

The local agency shall list all equipment projects within the same source category and 

eligible under the same local agency project grant agreement, in descending order of 

emission reductions per State dollar, with the highest number on top and the lowest 

number on the bottom. The local agency shall number or score each project starting at 

the bottom with a score of 1 and continuing consecutively to the top project. For 

example, with 8 equipment project proposals, the one with the greatest emission 

reductions per State dollar would receive a score of 8. 

Cost-Effectiveness and Match Score = number in above evaluation 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 67 February 2008

c) Competitive ranking 

The local agency shall add the Emission Reduction Score to the Cost-Effectiveness and 

Match Score to determine the final points for each equipment project. The agency shall 

rank equipment projects within the source category covered by the grant agreement 

from highest points to lowest points to create the competitive ranking list. 

Note: eligible projects to upgrade switcher locomotives shall automatically be ranked 

above other types of competing locomotive equipment project options, consistent with 

the statutory direction to give funding priority to switchers. 

d) Application of available funding

The local agency shall apply the available grant dollars (minus allowed administration 

funding) to the list of competitively ranked equipment projects within the source 

category. The local agency shall award grant funds to the top project and continue 

down the competitive ranking list until the grant funds are exhausted. 

e) Equipment project backup list

The local agency shall maintain an equipment project backup list comprised of the 

projects on the competitive ranking list that did not receive funding. Equipment projects 

on this backup list are available for Program funding, in the order established on the 

competitive ranking list, if additional funds become available. Funds may become 

available when an equipment project selected for funding doesn’t pass the preinspection, when an equipment owner voluntarily withdraws from the Program prior to 

execution of an equipment project contract, or for other reasons. 

As funding becomes available, local agency staff shall make a reasonable effort to 

contact the equipment owner with the top unfunded equipment project on the 

competitive ranking list to (a) determine if the owner is still interested in participating in 

the Program, and (b) obtain an updated signed equipment project application disclosure 

statement to verify that the equipment owner has not applied for Program funds 

elsewhere. If the local agency is unable to proceed with the top equipment project after 

a reasonable effort, the agency may proceed with the next equipment project on the 

backup list. 

7. Compliance check 

The local agency shall conduct a compliance check on the old vehicle for all truck 

replacement, repower or retrofit projects proposed for funding prior to executing an 

equipment project contract to ensure the equipment owner does not have any 

outstanding air pollution-related equipment violations. To complete the compliance 

check, the local agency shall email the following information for each truck to 

designated ARB Program staff: 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 68 February 2008

• Name of registered owner of the equipment. 

• Name of the equipment operator (if different). 

• Vehicle identification number. 

• Vehicle license plate number. 

• California Highway Patrol number (CA Number). 

• U.S. Department of Transportation number or Interstate Commerce Commission 

number. 

Due to the large number of vehicles that could require compliance checks, local 

agencies are encouraged to submit these data as soon as possible after receipt of the 

application. 

ARB Program staff shall work with Enforcement Division staff to obtain the information 

and email the results of the compliance check to the local agency within ten working 

days. 

If the compliance check indicates there is an outstanding violation, the equipment 

project application shall be disqualified. The local agency shall inform the engine owner 

in writing that the equipment project application has been disqualified for funding, and 

that the owner must correct the violation and pay any applicable fines. 

8. Equipment project pre-inspections 

The local agency shall conduct and document equipment project pre-inspections after 

the local agency has identified equipment projects for funding under this Program. Preinspections shall occur prior to the execution of an equipment project contract and must 

be conducted by local agency equipment inspectors or their designated contractors. 

The pre-inspection for each source category shall, at a minimum, include:

• Collection of the owner’s name, address and telephone number. 

• Identification of the location of the engine (business, ship berth or truck facility). 

• Collection of the serial number of the baseline engine and any additional information 

necessary to assist in the verification of the baseline engine application information. 

For engines without a visible and legible serial number, the local agency inspector 

must stamp the engine block with the Program equipment project number. The 

inspector must be present to personally verify engine removal or must be provided 

documentation and photographic evidence of the equipment before and after the 

engine destruction for these engines. 

• Collection of baseline information on ship activity at the berth or truck activity at the 

truck stop or distribution center. 

• Photographic, digital documentation for the project file of each piece of equipment 

being pre-inspected. The photographic documentation shall include: 

o The serial number of the engine (if legible) or Program equipment project 

number. 

o License plates or other distinguishing identification that is visible on the 

equipment. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 69 February 2008

o A photograph that captures a full view of the equipment being inspected (e.g. 

the entire truck, vessel, locomotive, etc.). 

• Description of the local agency’s method for cataloging, referencing, storing, and 

easily retrieving project-specific photos. 

• Verification by meter reading of the equipment usage (hours or miles), and that the 

usage reported in the equipment project application is reasonable given the usage 

meter reading. 

• Verification that the engine is operational (with a start-up) and is working as 

described in the equipment project application (document function and use). 

• Verification that engines subject to the software upgrades for diesel truck retrofit 

projects (i.e. chip reflash) have completed the upgrade. 

9. Notifications to equipment owners 

The local agency shall notify equipment project applicants of the status of their 

applications. Notifications shall be in writing, and occur within a reasonable time after 

the end of the solicitation period. 

At minimum, written notifications shall include the following: 

• A clear statement whether or not the equipment project is eligible for Program funds. 

• If equipment project is eligible, the notification shall include a clear statement 

indicating whether the equipment project was selected for funding or placed on the 

backup list. 

• If the equipment project is funded, the notification shall include: 

- Total Program funding amount for equipment project. 

- Information and deadlines for scheduling a pre-inspection. 

- Language indicating Program funding is contingent on passing the equipment 

pre-inspection. 

- Information and deadlines for executing equipment project contracts, applying for 

direct payments to vendors (if applicable), post-inspection requirements, 

deadlines to complete the project, and the process for obtaining Program funds 

through invoice payments. 

• If the equipment project is placed on the backup list, the notification shall include 

information pertaining to the potential for future funding of the equipment project. 

• If the equipment project is not being considered for Program funding, the notification 

shall include information about the equipment owner’s ability to apply for other 

incentive funding opportunities or the ability to participate for Program funding in 

future years. 

10. Equipment project contracts 

The local agency shall obligate funds for each equipment project as described in these 

Guidelines. These funding commitments shall become legally enforceable only through 

executed contracts between the local agency and equipment owner. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 70 February 2008

Equipment project contracts shall be executed within one year following execution of the 

local agency project grant agreement between ARB and the local agency. For 

FY2007-08, all equipment project contracts shall be executed within 18 months of the 

execution of the local agency project grant agreement. 

Local agency staff shall prepare and submit for review and signature two signed copies 

of the contract for Program funding to be signed by the equipment owner. After an 

equipment owner signs two copies of the contract agreement, the local agency shall 

retain one fully executed copy for its files, and return one fully executed copy to the 

equipment owner. 

At a minimum, an equipment project contract shall contain the following provisions: 

a) Standard contract provisions 

• Contract number—unique tracking number provided by local agency for each 

contract. 

• Effective date. 

• Term of contract. 

• Equipment owner contact information. 

• Indemnification—equipment owner agrees to indemnify and hold harmless ARB and 

the local agency for any liability arising out of the performance by the equipment 

owner.

• Severability—remaining provisions of a contract continue in effect even if a court 

holds a specific provision invalid. 

• Force majeure—ARB, local agency, and equipment owner are not liable for delay or 

failure in performance resulting from acts beyond their control. 

• Contract amendments—amendments shall only occur by mutual agreement in 

writing and signed by all parties. 

b) General Program provisions 

• Application-incorporate by reference the original equipment owner application. 

• Reporting requirements— equipment owner is responsible for submitting annual 

reports to the local agency. 

• Ongoing evaluations and audits— equipment owner agrees to allow ongoing 

evaluations and audits of equipment and documentation by the local agency, ARB, 

or their designated representative(s). 

• Records access requirements—equipment owner agrees to allow the local agency, 

ARB, or their designated representative(s) access to evaluate or audit Program 

records.

• Recordkeeping requirements—equipment owner agrees to retain all records 

pertaining to the Program, i.e. invoices, contracts, and correspondence for at least 

two years after equipment project ends or three years after final payment, whichever 

is later. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 71 February 2008

• Enforcement—provisions authorizing the local agency to inspect equipment projects 

to enforce contract terms. 

• Equipment project contract non-performance includes, but is not limited to: 

o Failure to meet the terms and conditions of an executed equipment project 

contract. 

o Equipment/engine is non-operational or malfunctioning. 

o Failure to meet established deadlines for equipment project completion. 

o Failure to allow for an electronic monitoring device, or tampering with an 

installed device or data. 

o Misuse of direct payments to vendors provisions. 

o Insufficient, incomplete, or faulty equipment project documentation. 

o Failure to provide required documentation or reports in a timely manner. 

• Remedies for non-performance include, but are not limited to: 

o Recovery of funds. 

o Other fiscal penalties on equipment owners based on the severity of the 

non-performance. 

o Cancellation of the contract. 

o A ban on the equipment owner’s ability to participate in future State 

incentive programs. 

o Prohibiting a specific piece of equipment from participating in another 

State incentive program. 

• Contract transfer provisions—provisions allowing for the transfer of the remaining 

contract terms to a new equipment owner. 

• Direct payments to dealers or manufacturers—allowance for local agency payments 

to go directly to vehicle or equipment dealers or manufacturers in the case of 

approved direct payments to vendors. 

• Independent contractor—equipment owner is an independent contractor and none of 

equipment owner’s agents shall be construed as agents or employees of ARB or the 

local agency. 

• Equipment maintenance—equipment owner is responsible for maintaining Programfunded engines or equipment in good operating condition and according to 

manufacturer’s recommendations. 

• Time is of the essence—time is of the essence in the performance of all contracts. 

• Program acknowledgment—equipment owner agrees to acknowledge the Program 

as a funding source in any related media events or other publicity material.

c) Source category-specific elements 

• Equipment project description. 

• Total cost for the equipment project. 

• Project cost breakdown (including technology/equipment purchase, labor for 

retrofit/installation, etc.). 

• Eligible costs--costs directly tied to the purchase of ARB-approved equipment 

projects. 

• Total Program funds for the project. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 72 February 2008

• Non-State match funds and source(s) of those funds—includes cash, in-kind, or 

other sources. 

• Ineligible costs—costs not directly tied to the purchase of ARB-approved equipment 

projects. 

• Project performance benchmarks—the expected activity and emission reductions 

from the new equipment. 

• Project inspections—equipment owner agrees to pre-inspection by the local agency 

of old equipment prior to the execution of a contract and post-inspection of the 

new/upgraded equipment prior to final payment. 

• Project schedule—timeframe required to complete equipment project including major 

milestones. 

• Schedule to expend funds—estimated schedule for local agency to expend Program 

funds to the equipment owner. 

• Request for payment—steps required for equipment owners to request expenditure 

of Program funds, including direct payments to vendors (if applicable). 

• Equipment warranty/insurance—equipment owner is responsible for securing 

warranty and maintaining insurance on the new equipment sufficient to repay the 

State’s investment in case of major damage. 

• Electronic monitoring devices—provisions requiring equipment owners to agree to 

the installation and use of an electronic monitoring device at any time during the 

contract term. 

11. Tax reporting 

The local agency shall comply with all State and federal tax reporting requirements 

associated with the payment of Program funds to equipment owners. This may include 

requiring the submittal of tax information using federal tax Form W-9, and issuing a 

federal Form 1099 to the equipment owner receiving grant funds. The local agency 

shall also report the applicable tax information to the California Franchise Tax Board 

and federal Internal Revenue Service. 

12. Provisions for lease-to-own programs 

The local agency may propose to use lease-to-own program(s) as part of the truck 

replacement option for both truck source categories. A description of the lease-to-own 

program shall be included in the local agency project application. Lease-to-own 

programs shall comply with the following minimum requirements: 

• The equipment project application must be signed and submitted by the owner of the 

new truck, and must include information on the truck to be replaced and the 

proposed lessee. 

• Equipment project contracts shall hold both the equipment owner and lessee legally 

liable (i.e. jointly and severally) for complying with the contract and Program 

requirements. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 73 February 2008

- The equipment project contract may allow certain provisions to apply solely to the 

equipment owner (e.g. financial requirements) or lessee (e.g. operational 

requirements), so long as the local agency maintains the ability to enforce all 

remedies for non-performance under the contract, including the recovery of funds 

or repossession of the truck, if necessary. 

- A local agency may also establish separate legally binding agreements with the 

equipment owner and the truck operator (lessee). In this case, both agreements 

must specify the ability of the local agency and equipment owner to enforce all 

remedies for any lessee’s non-performance under an equipment project contract. 

• Grant funds shall only be used to offset the capital cost of the truck and shall reduce 

the principal owed by the lessee to purchase the truck. The owner shall not impose 

a charge on the lessee for any portion of the Program funds as a component of the 

lease payments. The owner may set a lease payment schedule that recoups his or 

her out-of-pocket investment to purchase the new truck and a reasonable rate of 

interest over the term of the lease. Equipment project funds shall not be applied 

toward administration costs. 

• As a remedy for the non-performance of a lessee under the equipment project 

contract, the truck owner, with local agency approval, may transfer the truck to a 

new lessee, so long as the new lessee agrees to sign an equipment project contract 

under the same provisions, for the remaining contract term. 

• A truck project participating in a lease-to-own program shall be subject to the same 

Program requirements as any other truck competing for funding under that local 

agency project. If the funded local agency project includes multiple equipment 

project options, or multiple implementation approaches, a local agency shall not 

preferentially fund trucks in the lease-to-own program – they must compete against 

all other truck projects within that source category and trade corridor. 

• Local agencies interested in proposing Program funding for lease-to-own programs 

shall contact ARB staff for a list of financial data that must be collected as part of the 

equipment project application. 

13. Equipment project scrap requirements 

The local agency shall ensure that old equipment is scrapped (permanently removed 

from service) and associated materials disposed of in an environmentally acceptable 

manner, in accordance with these Guidelines and any applicable federal, state or local 

laws, regulations or requirements. 

Scrapping operations and material disposal applies to the following: 

• Truck engine repowers and truck replacement projects 

• Harbor craft engine repowers and vessel replacement projects, and 

• Locomotive engine repowers and new replacement projects 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 74 February 2008

Local agencies shall be responsible for implementing procedures for collecting all 

necessary information prior to scrap/disposal activities (e.g. during the pre-inspection). 

All information collected and recorded must be readily accessible to verify that scrap 

and disposal procedures were conducted for the appropriate engine, vehicle, vessel or 

locomotive. Documentation shall be available to ARB, or its designee to support 

ongoing program evaluations or audits as necessary.

The following procedures must be implemented for all repower and replacement 

projects: 

• Prior to destruction, old equipment must be in operable working condition as 

documented in the equipment pre-inspection. 

• The old equipment engine block (for repower projects) or vehicle/vessel/locomotive, 

including the frame and engine (for replacement projects) shall be physically 

destroyed in such a manner to eliminate the possibility of future operation. Engine 

blocks shall be punctured, and the vehicle, vessel or locomotive frame structure 

shall be dismantled, cut and/or demolished to render the equipment useless to 

prevent repeated use. 

• Licensed dismantlers are required to enter into an agreement with the local agency 

to qualify for participation. Dismantlers are required to be licensed by the 

Department of Motor Vehicles (DMV) (for auto-dismantlers), and have also have a 

valid California Environmental Protection Agency (Cal/EPA) Hazardous Materials 

Generators Permit. In addition, the dismantler must ensure compliance with any 

federal, state and local material disposal requirements, regulations, permits or 

requirements. 

• Funding is not available for any salvage or material disposal costs, including 

hazardous waste abatement fees, labor costs, fines, permits, or other charges 

resulting from destruction or disposal. 

• All equipment to be scrapped must have a complete, visible, and legible serial 

number or a stamp of the Program equipment project number applied at the time of 

pre-inspection by the local agency inspector. 

• The local agency or its designee must obtain digital documentation, see below, to 

ensure the engine identified in the equipment contract and the pre-inspection is the 

one that is to be scrapped. This documentation includes specific pictures to be taken 

before the engine is destroyed as well as photos after the engine is destroyed. 

The destruction of any engine without a verifiable serial number or Program equipment 

project number stamped on the equipment at the time of the equipment pre-inspection 

does not fulfill the scrappage requirement under this Program. 

The local agency must ensure the following additional requirements for each piece of 

equipment is undertaken: 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 75 February 2008

Table 3.1 Equipment Project Scrap Requirements 

Source 

Category 

Equipment 

Project Option 

Additional Scrappage Requirements 

Option (1) 

Retrofit

Not applicable.

Option (2) 

Repower 

• The licensed dismantler must dismantle and destroy the old 

vehicle’s engine and destroy within 60 days of receipt. The 

engine destruction must be done in accordance with program 

guidelines. 

• The local agency or its designee must provide digital 

photographs, described below, showing the destruction of the 

old engine. The local agency must receive these photos within 

10 business days of the engine being scrapped. 

• The following digital photos must be taken and labeled for the 

project file: 

1. Front of vehicle with hood down. 

2. Right side of vehicle with hood down. 

3. Left side of vehicle with hood down. 

4. Serial number that is printed either on the tag inside in the 

cab or on the frame rail. 

5. Engine side view (within and outside of engine 

compartment). 

6. Engine serial number either stamped on the block or on the 

tag. 

7. Destroyed engine block either inside or outside truck body. 

Trucks 

Serving 

Ports and 

Intermodal 

Rail Yards 

and 

Other Heavy 

Duty Diesel 

Trucks 

Option (3) 

Replacement 

In addition to the requirements listed above for engine repower 

projects, replacement projects must also: 

• Cut the old vehicle frame rails to ensure that the vehicle shall 

not be used again. 

• Have digital photo documentation to show the old vehicle was 

dismantled/ destroyed. 

• The equipment owner must file a VIN hold with DMV, and a 

“Non-Repairable Vehicle Certificate” with the DMV and submit 

a copy to the local agency at the time of the post-inspection. 

Other Heavy 

Duty Diesel 

Trucks

Option (4) 

Three-way 

Truck 

Transactions 

For this equipment project option, Truck B, which is a MY1990 or 

older heavy duty diesel truck, must:

• Dismantle and destroy the vehicle’s engine in accordance to 

the scrappage requirements list for this source category, 

equipment project option (2) repower; and 

• Follow the scrappage requirements listed above for this source 

category, equipment project option (3) replacement.
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 76 February 2008

Table 3.1 Equipment Project Scrap Requirements (continued)

Source 

Category 

Equipment 

Project Option 

Additional Scrappage Requirements 

Locomotives Options 

(1) & (2) 

Locomotives 

(for locomotive engine scrappage) 

The licensed dismantler must dismantle and destroy the old 

locomotive engine. 

• The local agency or its designee must provide digital 

photographs, described below, showing the destruction of the 

old locomotive engine. The local agency must receive these 

photos within 10 business days of the engine being scrapped. 

• The following digital picture views must be taken and stored 

appropriately for later identification in record files: 

1. Locomotive DOT certification or equivalent tag(s). 

2. Engine side view (within or outside of engine 

compartment). 

3. Engine serial number either stamped on the block or on the 

tag. 

4. Destroyed engine block.

(For locomotive replacements subject to scrappage) 

• The licensed dismantler must dismantle and destroy the 

locomotive engine within 60 days of receipt of the old 

locomotive engine. 

• The local agency or its designee must provide digital 

photographs, described below, showing the destruction of the 

old locomotive engine. The local agency must receive these 

photos within 10 business days of the engine being scrapped. 

• The following digital picture views must be taken and labeled or 

catalogued appropriately for later identification in record files: 

1. Locomotive DOT certification or equivalent tag(s). 

2. Locomotive views (front, side, rear). 

3. Serial number printed on the locomotive chassis.

4. Engine side view (within or outside of engine 

compartment). 

5. Engine serial number either stamped on the block or on 

the tag. 

6. Destroyed engine block either (installed or removed from 

engine housing area). 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 77 February 2008

Table 3.1 Equipment Project Scrap Requirements (continued)

Source 

Category 

Equipment 

Project Option 

Additional Scrappage Requirements 

Options 

(1) & (2) 

(specific to 

repower) 

• The licensed dismantler must dismantle and destroy the old 

vessel engine within 60 days of receipt. The engine 

destruction must be done in accordance with program

guidelines. 

• The local agency or its designee must provide digital 

photographs, described below, showing the destruction of the 

old vessel engine. The local agency must receive these photos 

within 10 business days of the engine being scrapped. 

• The following photos must be taken and labeled for the project 

file: 

1. Serial number printed either on the tag inside the marine 

vessel showing the ID and US Coast Guard registration (if 

applicable). 

2. Engine side view (within or outside of engine compartment). 

3. Engine serial number either stamped on the block or on the 

tag. 

4. Destroyed engine block either (installed or removed from 

engine housing area). 

5. Marine vessel identification tags and photos taken of the hull 

and stern of the marine vessel. 

Harbor Craft 

Options 

(1) & (2) 

(additional 

requirements 

for 

replacements) 

• In addition to the requirements listed above for harbor craft 

engine repower projects, replacement vessel projects must 

also: 

• The licensed salvage yard must dismantle and destroy the old 

vessel within 60 days of receipt of the old vessel. The 

destruction must be done in accordance with these Program 

Guidelines. 

• Have photo documentation to show evidence of the old vessel 

being destroyed. 

14. Equipment project post-inspections 

The local agency shall conduct and document equipment project post-inspections on all 

Program-funded equipment projects.

 

The post-inspection shall occur before final grant funding payments are made by the 

local agency to the equipment owner, and after the local agency has a valid invoice 

from the equipment owner. 

If the equipment project was approved for a direct payment to a vendor, the postinspection shall occur within 30 days of the equipment owner receiving the fully 

operational equipment (unless otherwise stated in the specific post-inspection 

requirement table). 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 78 February 2008

Post-inspections for all equipment projects shall include, but are not limited to, the 

following requirements: 

• Collection of the equipment owner’s name, mailing address and telephone number. 

• Verification of equipment application information with new equipment to ensure the 

new equipment is consistent with the equipment described in the equipment 

application. 

• Documentation of new equipment identifiers and specifications (e.g. VIN number for 

new trucks, serial numbers for new engines, etc.) 

• Digital photographic documentation of the equipment that is being post-inspected for 

the project file. This documentation shall include:

o A photograph of the serial number of the engine; 

o A photograph of the license plates or other distinguishing identification that 

are visible on the equipment; and 

o A photograph of the captures the full piece of equipment (i.e. the entire truck, 

vessel, locomotive, etc.) that is being inspected. 

• Methods for cataloging, referencing, storing, and easily retrieving specific equipment 

project documentation and photographs. 

• Visual witness and verification that the vehicle/engine/equipment is operational as 

stated in the contract. The inspector must visually witness and verify all engine start 

up and mobile equipment projects operating properly. 

• Verification of the destruction of the old/replaced equipment (engine, vehicle, vessel, 

or locomotive), where applicable. 

In addition to the general post-inspection requirements above, Table 3.2 provides 

additional post-inspection requirements for each source category and equipment project 

option. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 79 February 2008

Table 3.2 Post-Inspection Requirements 

Source 

Category 

Equipment 

Project Option 

Additional Requirements 

Option (1) 

Retrofit 

• Name of retrofit manufacturer. 

• Product serial number. 

• Month and year the device was manufactured (if not listed 

on retrofit label, information can be obtained from the 

retrofit manufacturer by reference to serial number). 

• DECS family name. 

• Engine family name and number. 

• Dates of when retrofit device was installed (start and 

end). 

• Name and address of company that installed the device. 

Option (2) 

Repower 

• Month and year that the engine was manufactured. 

• Address and name of company that installed the 

repowered engine. 

• Start and end dates to install this repower project. 

• Copy of ARB Executive Order documenting that the new 

engine is certified to 2007 emission levels for this 

Program. 

• Engine family name and number. 

• Engine make, model, model year. 

• Engine serial number. 

Trucks 

Serving Ports 

and Intermodal 

Rail Yards 

Option (3) 

Replacement 

• Vehicle type. 

• Vehicle identification number (VIN). 

• Vehicle make, model, model year. 

• Gross vehicle weight rating (GVWR). 

• Fuel type. 

• Vehicle license plate. 

• CA highway patrol number. 

• Engine family name and number. 

• Engine make, model year, engine year. 

• Copy of ARB Executive Order documenting that the new 

engine is certified to 2007 emission levels for this 

Program. 

Other Heavy 

Duty Diesel 

Trucks 

Option (1) 

Retrofit 

• Name of retrofit manufacturer. 

• Product serial number. 

• Month and year the device was manufactured (if not listed 

on retrofit label, information may be obtained from the 

retrofit manufacturer by reference to serial number). 

• DECS family name. 

• Engine family name and number. 

• Date of when retrofit device was installed. 

• Name and address of company that installed the device. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 80 February 2008

Table 3.2 Post-Inspection Requirements (continued)

Source 

Category 

Equipment 

Project 

Option 

Additional Requirements 

Option (2) 

Repower 

• Month and year that the engine was manufactured. 

• Address and name of company that installed the 

repowered engine. 

• The start date and end date of the installation this 

repower project. 

• Copy of ARB Executive Order documenting that the new 

engine is certified to 2007 emission levels for this 

Program. 

• Engine family name and number. 

• Engine make, model, model year. 

• Engine serial number. 

Option (3) 

Replacement 

• Vehicle type. 

• Vehicle identification number (VIN). 

• Vehicle make, model, model year. 

• Gross vehicle weight rating (GVWR). 

• Fuel type. 

• Vehicle license plate. 

• CA highway patrol number. 

• Engine family name and number. 

• Engine make, model year, engine year. 

• Copy of ARB Executive Order documenting that the new 

engine is certified to 2007 emission levels for this 

Program. 

Other Heavy 

Duty Diesel 

Trucks 

(continued)

Option (4) 

Three-way 

Truck 

Transaction 

*See individual post inspection requirements for retrofit 

(applicable to the newer truck—truck A) and replacement 

(applicable to the new MY 2007 truck –truck C).

Truck stop/ 

distribution 

center 

See 

Appendix G 

See Appendix G. 

Option (1) 

Switchers 

Locomotives 

Option (2) 

Line-hauls 

• Locomotive engine must be operated under its own power 

under loaded conditions. 

• Engine make, model, engine year and serial number for 

repower and replacement projects. 

• Start and end dates of when locomotive was repowered. 

• Address and name of company that repowered the 

locomotive engine. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 81 February 2008

Table 3.2 Post-Inspection Requirements (continued)

Source 

Category 

Equipment 

Project 

Option 

Additional Requirements 

Option (1) 

Grid based 

shore power 

• A ship must be plugged into berth to demonstrate to the 

inspector that it is in proper working order. 

• Inspection shall occur within 60 days of equipment owner 

receiving the fully operational equipment. 

• Verification that this project serves the intended berth. 

Shore Power 

Option (2) 

Non-grid 

based shore 

power 

• Ship must be plugged into berth to demonstrate to the 

inspector that it is in proper working order. 

• Inspection shall occur within 60 days of equipment owner 

receiving the fully operational equipment. 

• Verification that this project serves the intended berth(s). 

Options 

(1) & (2) 

Repower 

• Inspection shall occur within 60 days of equipment owner 

receiving the fully operational equipment. 

• For all repowered main engines, document the engine 

family name, engine make, model year, and serial 

number listed, and the engine fuel type. 

• Documentation of ARB engine certification. 

• Start and end dates of dry dock time. 

• Address and name of company that did the engine 

repower. 

Commercial 

Harbor Craft 

Options 

(1) & (2) 

Replacement 

• For all repowered main engines, document the engine 

family name, engine make, model year, and serial 

number listed, and the engine fuel type. 

• Start and end dates of dry dock time. 

• Address and name of company that replaced the 

engine(s). 

• Inspection shall occur within 90 days of equipment owner 

receiving the fully operational equipment. 

Cargo Handing 

Equipment 

Option (1) 

Energy 

Storage 

System 

• Name of retrofit manufacturer. 

• Retrofit serial number, and month/year of manufacture. 

• If engine or equipment was installed to meet Program 

eligibility requirements concurrent with the energy storage 

system: engine family name, make, model year, serial 

number, fuel type, and horsepower; retrofit name, serial 

number, date of manufacture. 

15. Local agency requests to ARB for grant funds 

The local agency may request grant funds from ARB by submitting a valid Grant 

Expenditure Request by an authorized local agency representative acting under a fully 

executed Local Agency Project Grant Agreement. ARB’s expenditure requirements and 

provisions are detailed in Chapter II.E.2. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 82 February 2008

16. Local agency non-performance provisions 

The local agency shall be held responsible for the implementation of the local agency 

project. Local agency non-performance provisions and requirements are included in 

Chapter II.E.7 of these guidelines. 

E. Obligations, Expenditures, and Earned Interest 

1. Local agency obligation of funds to equipment owners 

In FY2007-08 only, local agencies shall obligate Program funds via executed equipment 

project contracts no later than 18 months from the date of the executed Local Agency 

Project Grant Agreement between ARB and the local agency. 

After FY2007-08, local agencies shall obligate Program funds no later than 1 year from 

the date of the executed Local Agency Project Grant Agreement between ARB and the 

local agency. 

Note: Once a local agency has an executed equipment project contract, Program funds 

must be spent according to the terms of the contract, or they revert back to the 

California Ports Infrastructure, Security, and Air Quality Improvement Account. Local 

agencies are prohibited by statute from re-directing Program funds from failed contracts 

to another eligible equipment project. 

2. Local agency expenditures on equipment projects 

a) Expenditure deadlines for equipment projects 

Local agencies shall comply with the following deadlines to liquidate Program funds. 

These expenditure deadlines represent the maximum time allowed from the equipment 

project contract execution date to the expenditure of Program funds to complete and 

close out an equipment project: 

• 1 year to verify project completion/close out payment for cargo equipment projects. 

• 18 months to verify project completion/close out payment for truck retrofit, repower, 

and replacement projects. 

• 2 years to verify project completion/close out payment for locomotive projects and 

non-grid shore power projects. 

• 3 years to verify project completion, obtain at least one year of data on actual use, 

and close out payment for truck stop or distribution center electrification projects. 

• 4 years to verify project completion/close out payment for harbor craft projects and 

grid-based shore power projects. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 83 February 2008

b) Equipment project purchase restrictions 

Local agencies shall not reimburse equipment project applicants for orders or any 

payments on a new engine, piece of equipment, or vehicle that take place prior to local 

agency approval of the project through contract execution. 

Dealers ordering engines, equipment, or vehicles prior to contract execution assume all 

financial risk, and are in no way assured grant funds. 

An equipment owner may not receive engines, equipment, or vehicles, nor may work 

begin on a repower or retrofit project or a project to install electrical infrastructure, until 

the project contract is fully executed. 

c) Invoice payments (reimbursements) 

With the exception of approved direct payments to vendors as described in 

Chapter III.E.2.d, local agencies shall only expend Program funds through invoice 

payments. Invoice payments provide Program funding to equipment owners on a 

reimbursement basis. 

After receiving a satisfactory post-inspection from the local agencies on completed 

equipment projects, equipment owners shall complete and submit itemized invoices for 

currently operational new engines, vehicles, or pieces of equipment to the local agency 

for reimbursement. 

An invoice shall be itemized to include enough detail to ensure that the local agency 

provides reimbursement only for eligible project costs, yet be clear and concise enough 

to be understandable. The local agency shall review the itemized invoice and only pay 

for eligible expenses up to the funding caps established by these Guidelines and the 

local agency project grant agreement. 

Equipment owners shall not request or receive payments for engines, vehicles, 

equipment, or electric infrastructure that are non-operational; taxes; consulting services; 

license; registration; insurance, or any other costs not eligible for Program funds. 

Charges for equipment and parts on engine repower projects are only eligible for 

funding if they are required to ensure the effective installation and functioning of the new 

engine and achieve the expected emissions performance, but are not part of typical 

vehicle or equipment maintenance or repair. Examples of ineligible repower costs 

include, but are not limited to: tires, axles, paint, brakes, and mufflers. 

Most labor expenses are not eligible for payment with Program funds; the exceptions 

are labor to install a diesel PM filter on a truck, labor to make necessary vessel 

modifications and install the new engine in a harbor craft, and labor to install the 

electrical infrastructure to supply a ship berth or truck pedestal. Whether reimbursable 

with Program funds or not, labor expenses shall be included in the itemized invoice with 

the detailed number of hours charged and the hourly wage.
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 84 February 2008

Equipment owners may submit a single, itemized invoice for multiple, completed 

equipment projects under this Program. 

Invoice payments may be made directly to the equipment or engine dealer or distributor 

only if such payment arrangements are specified in the equipment project contract. 

The local agency shall maintain copies of all invoices and documentation of payment in 

the equipment project file. 

d) Direct payment to vendor 

Local agencies shall expend Program funds through invoice payments (described 

above) or according to the direct payment to vendor option described in this section. 

• The direct payment to vendor option is only available to truck retrofit and 

replacement equipment projects, and harbor craft repower and replacement 

equipment projects. 

• Local agencies shall approve all direct payment to vendor requests as part of their 

equipment project competitive ranking and selection process. Equipment owners 

are required to request direct payment funding in the equipment project application. 

• Direct payment terms shall be incorporated in the legally binding equipment project 

contract between the local agency and equipment owner. 

• The equipment project contract shall include terms specifying arrangements for the 

local agency payments to go directly to the engine, truck, or retrofit dealer or 

manufacturer. 

3. Earned interest 

The local agency shall track the amount of interest earned on Program funds held in 

local agency accounts beginning immediately after receipt of Program funds from ARB. 

a) Calculation of earned interest 

The local agency shall maintain accounting records (e.g. general ledger) that track 

interest earned and expenditures on Program funds. 

• If the local agency keeps its Program funds in a non-segregated account, the local 

agency shall maintain accounting records that first separates program funds from 

other funds administered by the local agency and then further separates earned 

interest and the related expenditures. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 85 February 2008

• The calculation of interest shall be based on an average daily balance or some other 

reasonable and demonstrable method of reallocating the proceeds from the fund 

back into the program. 

• Earned interest shall be tracked such that it is separately identifiable from other 

program funds. 

• Each agency’s methodology for calculating Program interest shall be consistent with 

how it calculates earned interest for its other fiscal programs. 

b) Reporting requirement for earned interest 

 

The local agency shall indicate the amount of interest earned and expended on all 

Program funds in the semi-annual report. 

• Documentation of earned interest generation and expenditure shall be retained for a 

minimum of the local agency project grant agreement term plus two years or date of 

the final equipment project invoice payment plus three years, whichever is longer. 

c) Earned interest expenditure provisions 

 

The local agency shall expend interest earned from Program funds on eligible 

equipment projects in the following priority: 

• The first priority for expenditure shall be to fund equipment project options within the 

same source category identified in the grant agreement. 

• If the local agency is unable to find or fund equipment project options within the 

source category, the earned interest may be applied to equipment project options 

within the funding category identified in the grant agreement. For example, a local 

agency with a grant agreement for the shore power source category may expend 

earned interest on rubber tired gantry cranes if another shore power project is not 

available or the amount of earned interest is not sufficient to complete a another 

shore power project. 

If the local agency is authorized to use a portion of the grant for administration funds, 

the local agency may use up the maximum allowed by these Guidelines for that source 

category to implement additional projects with the earned interest. 

If a local agency is unable to expend all or a portion of the earned interest, the 

remaining earned interest shall be returned to ARB for re-allocation. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 86 February 2008

F. Ongoing Local Agency Evaluations of Equipment Projects 

Local agencies shall evaluate equipment projects on an ongoing basis. The ongoing 

evaluation process is designed to meet the accountability requirements of SB 88 and 

the Governor’s Executive Order S-02-07. 

Local agency evaluation efforts shall include, but are not limited to: ongoing desk 

reviews of reports and equipment project updates provided by equipment owners, 

review of electronic monitoring unit data (as applicable), site inspections, equipment 

inspections, review of equipment maintenance and activity logs, and other measures 

deemed appropriate by ARB or the local agency. 

Equipment owners shall permit the local agency, ARB, the Department of Finance, the 

Bureau of State Audits, or any authorized designee, access, during normal business 

hours, to conduct ongoing evaluations for the purpose of monitoring the Program. 

G. Local Agency Reporting Requirements 

Local agencies shall obtain, verify, and submit to ARB all local agency and equipment 

project reporting information as outlined in these Guidelines. 

1. Quarterly data updates 

Local agencies shall submit to ARB quarterly data updates on all local agency projects 

and the equipment projects associated with each. 

Local agency quarterly data updates shall begin at minimum one quarter after the 

execution of the grant agreement, and continue until the local agency provides ARB 

with the local agency project completion report (see below). These quarterly data 

updates shall be cumulative, reflecting the most current local agency project 

information. 

Quarterly data updates to ARB shall include the following information: 

• Start and end dates of most recent equipment project solicitation. 

• A ranked equipment project list identifying each equipment project application 

received by the local agency through the solicitation process, and containing the 

following information for each equipment project: 

- Weighted emission reductions. 

- Total project cost. 

- Funding status (funded, funded from backup list, not funded). 

- Funding amount (amount of Program funds, amount of non-Program funds). 

- Equipment project contract status (executed/not executed). 

- Equipment pre-inspection status (scheduled/not-completed/completed). 

- Equipment post-inspection status (scheduled/not-completed/completed). 

- Equipment project status (active/withdrawn/ineligible/backup list). 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 87 February 2008

• Total emission benefits for the local agency project. 

• Total Program funds obligated. 

• Total Program funds expended/remaining (breakdown by project funds and 

administration funds). 

• Total non-Program funds expended per fiscal year of funding. 

2. Semi-annual report 

Local agencies shall submit to ARB semi-annual reports. 

Local agency semi-annual reports shall begin the year following initial ARB obligation of 

Program funds to the local agency, and continue for the term of the Local Agency 

Project Grant Agreement. ARB staff may standardize the submittal dates for these 

reports and notify local agencies. Local agencies shall submit semi-annual reports on 

the schedule established by ARB. H&S §39625.02(f)(1) and Executive Order S-02-07. 

At minimum, the semi-annual report shall include the following data: 

• Start and end dates of most recent equipment project solicitation. 

• The competitively ranked equipment project list identifying each equipment project 

application received by the local agency through the solicitation process, and 

containing the following information for each equipment project: 

- Description of the equipment project. 

- The weighted emission reductions and reductions per State dollar invested. 

- Funding status (funded, funded from backup list, not funded). 

- Funding amount (amount of Program funds, amount of non-Program funds). 

- Equipment project contract status (executed/not executed). 

- Equipment pre-inspection status (scheduled/not-completed/completed). 

- Equipment post-inspection status (scheduled/not-completed/completed). 

- Equipment project status (active/withdrawn/ineligible/backup list). 

• The following information for the local agency project: 

- Total emission reductions (combustion PM and NOx).

- Total Program funds obligated. 

- Total Program funds expended/remaining (break down by project funds and 

administration funds). 

- Total non-Program funds expended by source of funds. 

- Amount of interest earned from Program funds. 

- Total interest earned from Program funds. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 88 February 2008

At minimum, the semi-annual report shall include the following qualitative information: 

• Costs of funded local agency project compared to the approved budget for funded 

local agency project. 

• Actions undertaken to ensure funded local agency project is being implemented 

according to budget allocations or a plan for achieving the benefits of the project by 

either down-scoping the project or by identifying alternative funding sources to meet 

any identified cost increases and remain within budget. 

• Actual timeline and milestones of funded local agency project compared to the 

planned timeline for funded local agency project. 

• Actions undertaken to ensure funded local agency project is being implemented in a 

timely fashion. 

• Status of equipment project tracking efforts to ensure compliance with operating 

conditions. 

• Status of equipment owner reporting compliance. 

• A document signed by the local agency’s Chief Administrative Officer, Chief 

Financial Officer, and Program Grant Administrator verifying that the equipment 

project and financial data submitted in the report is complete, accurate, and that 

there are no known instances of fraud. 

• Any other information requested by ARB. 

Local agencies shall also submit to ARB copies of executed equipment project 

contracts. Local agencies may make and submit one complete copy of their standard 

contract format and then submit only the pertinent pages (initial page, signature page 

and page(s) describing the equipment project) of the contract to ARB. Local agencies 

shall submit only one copy of each contract or the pertinent pages of each contract. 

3. Local agency project completion report 

Local agencies shall submit to ARB a local agency project completion report on the full 

local agency liquidation of Program funds identified in an executed local agency project 

grant agreement. 

The project completion report shall be submitted no later than six months following the 

full local agency liquidation of Program funds under the local agency project grant 

agreement. H&S §39625.02(f)(2). 

This report shall provide information regarding the specific local agency expenditure of 

Program funds on administration and equipment project costs. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap III: Local Agency Project 89 February 2008

At minimum, the local agency project completion report shall include the following: 

• A list of the completed equipment projects that includes: 

- Description of each completed equipment project. 

- Copies of invoices that document the amount of Program funds expended for 

each equipment project. 

- Total cost of funded local agency project compared to the approved budget for 

funded local agency project. 

- Actions undertaken to ensure funded local agency project was implemented 

according to budget allocations. 

- Actual timeline and milestones of funded local agency project compared to the 

planned timeline for funded local agency project. 

- Action undertaken to ensure funded local agency project was implemented in a 

timely fashion. 

- Total emission reductions achieved for each equipment project. 

• Amount of interest accrued on Program funds. 

• List and description of equipment projects funded with earned interest. 

• Copies of executed equipment project contracts that that were not previously 

submitted. 

• A brief narrative specifying: ongoing evaluation and auditing efforts and results; 

enforcement actions, recaptured funds, and any reverted funds. 

• A document signed by the local agency’s Chief Administrative Officer, Chief 

Financial Officer, and Program Grant Administrator verifying that the equipment 

project and financial data submitted in the report is complete, accurate, and that 

there are no known instances of fraud. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap IV: Gen’l Equipment Project Req’ts 90 February 2008

IV. General Equipment Project Requirements 

A. Ownership Requirements 

Equipment project applications shall be signed and submitted only by equipment 

owners. 

Individuals or companies that operate the existing equipment or will operate the 

replacement equipment under a lease agreement with the equipment owner are 

prohibited from applying for bond funding, but may participate if a lease-to-own program 

is offered by the local agency according to the provisions outlined in Chapter III.D.12. 

B. Third Party Applications 

Third party applications are not allowed. The owner of the existing equipment must sign 

and agree to the submittal of the equipment project application. 

A third party may, however, complete an application (or part) on the owner’s behalf. 

Equipment project applications shall include a signature section for third parties. The 

third party signature section shall include signature and date lines, and blanks for the 

third party to list how much they are being paid, if anything, to complete the application 

and what source of funds are being used to pay them. 

C. Equipment Project Specifications 

Equipment owners may refer to Appendices A-G for descriptions and specifications for 

the equipment projects eligible for FY2007-08 funds under this Program. However, as 

described in Chapter III.B.2., local agencies may submit local agency project 

applications that include allowable project alternatives. 

Equipment owners are advised to carefully review the information packets provided by 

local agencies during the equipment project solicitation period. 

D. Equipment Project Application Requirements 

1. Equipment project information 

Equipment project applications shall contain the equipment project application 

information identified in Appendices A-G of these Guidelines. This typically includes 

information on: the equipment owner, the existing equipment, the proposed equipment 

project (with funding level and project life), costs, schedules, and operational/activity 

data to quantify the benefits of the equipment project. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap IV: Gen’l Equipment Project Req’ts 91 February 2008

2. Equipment project schedule 

Equipment project applications shall include a schedule for the major milestones listed 

by source category in Appendices A-G and a commitment by the equipment owner to 

meet the schedule identified in the application. The equipment project schedule shall 

also be included as part of the equipment project contract signed between the local 

agency and equipment owner. Adjustments to the schedule prior to contract execution 

may only occur with local agency consent. 

3. Case-by-case equipment projects 

Only equipment project options specifically identified in these Guidelines shall be 

eligible for FY2007-08 funds under this Program. Equipment project options beyond 

those identified in these Guidelines may be recommended to ARB staff for inclusion in 

future Guideline updates. 

4. Disclosures 

Equipment project applications shall include disclosures that the owner shall sign, that 

include, at minimum: 

• Certification that once the equipment owner signs the equipment project application, 

the owner shall not submit other applications for funding for the same truck, 

locomotive, equipment, vessel, berth or facility under this Program or the Carl Moyer 

Program. 

• Disclosure of any other source(s) of funding that the equipment owner has applied 

for that would be used for the same equipment project. The disclosure shall identify 

the source of funds, how much is being applied for, and what the funding would be 

used for.

• Disclosure of the value of any existing financial incentive that directly reduces the 

project cost, including tax credits or deductions, grants, or other public financial 

assistance, for the same equipment project. 

• Certification that the equipment owner has reviewed the application and that the 

application information is correct. 

• Certification that neither the owner nor equipment identified in the equipment project 

application has any outstanding violations of ARB regulations. 

• Certification that equipment project match funding is reasonably available to 

complete the equipment project according to the proposed timeframe. 

• Certification that Program funds were not used to previously upgrade the equipment 

identified in the equipment project application. For example, an owner of a truck that 

received funding for a retrofit device under this Program may not subsequently 

submit an application for Program funds to replace that truck. 

The equipment owner may be allowed to re-apply for equipment project funding if a 

previous application for the same project has been rejected and is no longer being 

considered by a local agency for funding. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap IV: Gen’l Equipment Project Req’ts 92 February 2008

An equipment owner who is found to have submitted multiple applications for the same 

equipment project and not disclosed any other requested or received financial incentive 

shall, at a minimum, be disqualified from funding for that engine from this Program. The 

equipment owner may also be prohibited from submitting future applications to any and 

all ARB incentive programs or local agency incentive programs. 

5. Equipment project funding demonstration 

Equipment project applications shall require a demonstration of the availability of the 

necessary funds to complete the proposed equipment project, including the proposed 

Program funds, and matching funds from other State, local, federal, or private sources. 

Equipment project applications shall identify any loan programs the equipment owner 

intends to utilize to fully fund the equipment project. 

The total project cost shall include the purchase price of the equipment, including 

shipping charges, and the cost of installation or construction (as applicable). Installation 

costs shall only include installation of the components necessary to operate the 

equipment. 

• Optional items (such as cigar lighters or custom mud flaps on trucks) shall be paid at 

the owner’s expense. 

• Taxes, fees, insurance, and other charges may not be included as part of the total 

project cost. 

• Electricity costs may not be included in the project cost. 

• Costs for equipment and parts on engine repower projects are only eligible for 

funding if they are required to ensure the effective installation and functioning of the 

new engine and achieve the expected emissions performance, but are not part of 

typical vehicle or equipment maintenance or repair. Examples of ineligible repower 

costs include, but are not limited to: tires, axles, paint, brakes, and mufflers. 

The equipment owner may estimate the total project cost in the first year of operation. 

6. Equipment owner signature 

Equipment project applications shall be signed by the equipment owner and submitted 

to the local agency with an original signature. 

E. Equipment Project Contract Requirements 

Local agencies shall obligate all Program funds for equipment projects through funding 

commitments that shall become legally enforceable through executed equipment project 

contracts between the local agency and equipment owners. Equipment project contract 

requirements and terms are contained in Chapter III.D.10. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap IV: Gen’l Equipment Project Req’ts 93 February 2008

F. Equipment Sales Requirements 

Equipment owners with executed equipment project contracts with a local agency shall 

be fully and legally responsible for the operation of equipment funded under this 

Program in compliance with the conditions of the contract. Equipment owners may not 

assign, sell, transfer, license, or subcontract any rights or obligations to a third party 

without the express prior written consent of the local agency. 

If the original owner of Program-funded equipment chooses to sell the equipment for 

any reason, or is required to replace the equipment with cleaner equipment prior to the 

end of the contract term, the original owner shall notify the local agency and receive 

prior written consent for the transaction from the local agency. 

Prior to completing the transaction, the original owner shall inform the party purchasing 

the equipment of the equipment project contract provisions, and disclose the remaining 

contract term. The original owner shall be responsible for establishing contact between 

the new owner and local agency in order to facilitate the transfer of the contract 

provisions and terms. 

The original owner shall provide the prospective new owner with valid contact 

information for the local agency so the new owner can assume legal responsibility under 

the original contract or enter into a new equipment project contract with the local 

agency, for the remainder of the contract term. The original equipment owner who 

received Program funding shall not be relieved of his or her legal obligation to fulfill the 

conditions of the contract unless the new owner has assumed responsibility through an 

executed contract with the local agency. 

If the equipment is sold, and the original equipment owner failed to fulfill the 

responsibilities described in this section, remedies for equipment project nonperformance shall be imposed. 

G. Equipment Project Non-Performance 

 

All equipment project contracts shall include non-performance provisions enforceable by 

the local agency. Non-performance includes, but is not limited to: 

• Failure to meet the terms and conditions of an executed equipment project contract, 

including but not limited to equipment operating conditions and geographic 

restrictions. 

• Equipment/engine is non-operational or malfunctioning. 

• Failure to meet established deadlines for equipment project completion. 

• Failure to allow for an electronic monitoring device, or tampering with an installed 

device or data. 

• Misuse of direct payments to vendors provisions. 

• Insufficient, incomplete, or faulty equipment project documentation. 

• Failure to provide required documentation or reports in a timely manner. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Chap IV: Gen’l Equipment Project Req’ts 94 February 2008

Remedies for equipment project non-performance may include, but are not limited to: 

• Recovery of all or a portion of Program funds. 

• Other fiscal penalties on equipment owners based on the severity of the nonperformance. 

• Cancellation of the contract. 

• A ban on the equipment owner’s ability to participate in future State incentive 

programs. 

• Prohibiting a specific piece of equipment from participating in another State incentive 

program. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

 February 2008

APPENDICES 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

 February 2008

[this page intentionally blank] 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix A: Port/Rail Yard Trucks A-1 February 2008

APPENDIX A Trucks Serving Ports and Intermodal Rail 

Yards 

A. Equipment Project Specifications 

Trucks Serving Ports and Intermodal Rail Yards 

Eligible 

Equipment 

Class 8 (>33,000 lbs gross vehicle weight rating) heavy-duty diesel trucks used to move 

goods. 

Equipment owner must demonstrate: 

• Continuous registration (California base-plated or International Registration Plan) in 

California for the past 2 years. 

• At least 50 percent operation within trade corridor(s) for the past 2 years. 

Ineligible 

Equipment 

• Trucks subject to ARB’s public and utility fleet rule. 

• Trucks subject to ARB’s solid waste collection vehicle rule. 

• Trucks subject to ARB’s diesel cargo handling equipment rule. 

Option (1) 

Retrofit 

Requirements 

Partial funding of up to $5,000/truck to retrofit an eligible MY2006 or older heavy duty 

diesel truck with an ARB verified Level 3 diesel particulate filter that reduces diesel PM 

by 85 percent or more. 

• Program-funded diesel particulate filter shall be installed and operational at least 6 

months prior to a regulatory requirement for that technology or level of emissions 

control. 

Equipment owner shall: 

• Commit to at least 4 years of 100% California-only operation and California baseplated registration. Dual plates, IRP, and any other out-of-state registrations are 

prohibited. 

• Commit to at least 4 years of frequent port or inter-modal rail yard service (150+ 

visits/year). 

• Commit to at least 50% of travel in trade corridors for duration of contract term. 

• Agree to accept an on-board electronic monitoring unit at any time during the 

contract term. 

• Agree to equipment inspections. 

• Comply with record-keeping, reporting, and audit requirements. 

• Sign a legally binding contract with the local agency including project milestone and 

completion deadlines. 

• Properly maintain filter in good operating condition and according to manufacturer’s 

recommendations. 

• Demonstrate proof of equipment warranty on filter.

• Demonstrate that any mid-1990s engine subject to the software upgrades for diesel 

trucks (i.e. chip reflash) has completed the upgrade. 

• Certify that there are no outstanding ARB equipment violations associated with the 

equipment project application. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix A: Port/Rail Yard Trucks A-2 February 2008

Trucks Serving Ports and Intermodal Rail Yards (continued) 

Option (2) 

Repower 

Requirements 

Pro-rated 

Alternative 

The lower of 50% or $20,000 to repower an eligible MY2003 or older heavy duty diesel 

truck with a new engine that meets MY2007 emission levels or lower and ARB’s 

requirements for engine manufacturer diagnostics. 

• Program-funded truck repower project shall be completed and operational at least 3 

years prior to a regulatory requirement for that technology or level of emissions 

control. For independent owner operators, the equipment project shall be 

completed and operational at least 2 years prior to a regulatory requirement for that 

technology or level of emissions control. 

Equipment owner shall: 

• Commit to at least 8 years or 350,000 miles of 100% California-only operation and 

California base-plated registration. Dual plates, IRP, and any other out-of-state 

registrations are prohibited. 

• Commit to at least 4 years of frequent port or inter-modal rail yard service 

(150+ visits/year). 

• Commit to at least 50% of travel in trade corridors for duration of contract term. 

• Agree to accept an on-board electronic monitoring unit at any time during the 

contract term. 

• Agree to equipment inspections. 

• Scrap the old engine. 

• Comply with record-keeping, reporting, and audit requirements. 

• Sign a legally binding contract with the local agency including project milestone and 

completion deadlines. 

• Properly maintain new engine, emission controls, and diagnostics in good operating 

condition and according to manufacturer’s recommendations. 

• Demonstrate proof of equipment warranty and comprehensive insurance on 

upgraded equipment. 

• Provide a copy of ARB Executive Order documenting that the new truck engine 

meets 2007 emission levels. 

• Certify that there are no outstanding ARB equipment violations associated with the 

equipment project application. 

Equipment owners may opt for a pro-rated alternative consisting of duplicate 

requirements, except that the Program will pay the lower of 25% or $10,000 for a 4 year 

commitment of 100% California-only operation and California base-plated registration. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix A: Port/Rail Yard Trucks A-3 February 2008

Trucks Serving Ports and Intermodal Rail Yards (continued) 

Option (3) 

Replacement 

Requirements 

Pro-rated 

Alternative 

Partial funding of up to $50,000/truck to replace an eligible MY2003 or older heavy duty 

diesel truck with a diesel or alternative fuel truck meeting MY2007 emission levels or lower. 

• Program-funded truck replacement project shall be completed and operational at least 3 

years prior to a regulatory requirement a truck meeting MY2007 emission standards. 

For independent owner operators, the new truck must be operational at least 2 years 

prior to a regulatory requirement for a truck meeting MY2007 emission standards. 

Equipment owner shall: 

• Commit to at least 8 years or 350,000 miles of 100% California-only operation and 

California base-plated registration. Dual plates, IRP, and any other out-of-state 

registrations are prohibited. 

• Commit to at least 4 years of frequent port or intermodal rail yard service (150+ 

visits/year). 

• Commit to at least 50% of travel in trade corridors for duration of contract term. 

• Agree to accept an on-board electronic monitoring unit at any time during the contract 

term. 

• Agree to equipment inspections. 

• Scrap the old truck. 

• Comply with record-keeping, reporting, and audit requirements. 

• Sign a legally binding contract with the local agency including project milestone and 

completion deadlines. Under a lease program, the owner and lessee must sign the 

contract. 

• Properly maintain new truck in good operating condition and according to manufacturer’s 

recommendations. 

• Demonstrate proof of equipment warranty and comprehensive insurance on new truck. 

• Provide copy of ARB Executive Order documenting that the new truck engine meets 

2007 emission levels. 

• Certify that there are no outstanding ARB equipment violations associated with the 

equipment project application. 

Equipment owners may opt for a pro-rated alternative consisting of duplicate requirements, 

except that the Program will pay up to $25,000 for a 4 year commitment of 100% Californiaonly operation and California base-plated registration. 

Project Cost 

Assumptions 

Option (1): Total cost of a diesel particulate filter is ~$10,000 

Option (2): Total average cost of a repower is ~$40,000 

Options (3) & (4): Total cost of a new MY2007 truck is ~$100,000 (diesel) to ~$180,000 

(natural gas) 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix A: Port/Rail Yard Trucks A-4 February 2008

B. Major Milestones for Equipment Project Completion 

• Equipment order. 

• Equipment acquisition/installation. 

• Submittal of invoice to local agency for reimbursement. 

• 1st reporting milestone 6 months after equipment project completion. 

C. Recordkeeping Requirements 

Equipment owners shall retain, at minimum, all documents, invoices, and 

correspondence associated with the application, award, contract, monitoring, 

enforcement, and reporting requirements at least two years after equipment project 

contact term or three years after final payment, whichever is later. Records shall be 

readily available and accessible to the local agency, ARB, or designee upon request for 

the purposes of ongoing evaluations or auditing. 

D. Annual Reporting Requirements 

Equipment owners shall be responsible for annual reporting to the local agency that 

includes, but is not limited to: 

• Contact information (owner name, address, phone, etc.). 

• Proof of California registration. 

• Annual vehicle miles of travel (including mileage/activity logs for documentation). 

• Certification of California-only operation (including certification that permits were not 

utilized to make out-of-state trips). 

• Certification and documentation of at least 50% of travel in trade corridors. 

• Documentation of the number of port/rail yard visits within 12 month period. 

• Summary of maintenance performed and inspections conducted. 

• Certification that the bond-funded project was operated in accordance with signed 

contract and that all information submitted is true and accurate. 

• Other information as requested by the local agency. 

E. Ongoing Evaluations and Audits 

Equipment owners shall agree to ongoing equipment project evaluations and equipment 

project audits by the local agency, ARB, or authorized designees. ARB and local 

agency audit requirements and provisions are found in Chapter II.E.5.
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix A: Port/Rail Yard Trucks A-5 February 2008

F. Application Information 

Equipment owners shall provide the following information and documentation in addition 

to the requirements described in Chapter IV and other information ARB or local 

agencies may request on the equipment project applications. 

1. General contact information 

This section applies to all equipment project options listed below. 

• Name/organization/agency/company 

• Mailing address 

• Primary contact name and phone number 

• Person with equipment contract signing authority (Owner) 

• Proof of identity of equipment owner 

• Small business information 

o Fleet size 

o Number of employees 

o Annual gross income 

2. Option (1): retrofit 

a) Current equipment and activity information 

• Truck data 

o Truck make, model, model year 

o Vehicle Identification Number 

o Gross vehicle weight rating 

o License plate number 

o Engine make, model, engine year, serial number 

o Engine horsepower and fuel type 

o Current odometer reading (estimate total engine mileage if odometer is 

missing or broken) 

• Truck documentation 

o Proof of DMV registration for current and prior two years 

o Documentation of current ownership (copy of title of truck) 

• Vocation and activity data for the past 2 years 

o Vocation(s) 

o Annual vehicle miles of travel (VMT) 

o Annual VMT in California 

o Estimated percentage of annual VMT in trade corridors 

o Average number of port or rail yard visits per year 

• Vocation and activity documentation for the past 2 years 

o Documentation of at least 50% of travel in corridors may be required 

o Identify the trade corridors in which the equipment is routinely operated 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix A: Port/Rail Yard Trucks A-6 February 2008

b) Proposed equipment project information 

• Retrofit device data 

o ARB-verified retrofit device company and name of device 

o ARB-verified NOx reduction & PM reduction (%) 

• Retrofit device documentation 

o ARB Executive Order for retrofit device listing the engine families for which 

the retrofit is verified, along with a picture of the engine label showing the 

engine family 

• Itemized cost information for eligible expenses (verifiable quote) 

• Predicted activity data with new equipment 

o Estimated annual VMT 

o Estimated percentage of annual VMT in trade corridors 

o Estimated number of port or rail yard visits per year (must be 150+) 

• Equipment project funding demonstration 

o Total project cost 

o Program dollars requested 

o Source and amounts of other funding (private, local, other State, federal) 

o Request for a direct payment to vendor (if applicable) 

o Documentation of match funding availability 

3. Option (2): repower 

a) Current equipment and activity information 

• Truck data 

o Truck make, model, model year 

o Vehicle Identification Number 

o Gross vehicle weight rating 

o License plate number 

o Engine make, model, engine year, serial number 

o Engine horsepower and fuel type 

o Current odometer reading (estimate total engine mileage if odometer is 

missing or broken 

• Truck documentation 

o Proof of DMV registration for current and prior two years 

o Documentation of current ownership (copy of title of truck) 

• Vocation and activity data for the past 2 years 

o Vocation(s) 

o Annual vehicle miles of travel (VMT) 

o Annual VMT in California 

o Estimated percentage of annual VMT in trade corridors 

o Average number of port or rail yard visits per year 

• Vocation and activity documentation for the past 2 years 

o Documentation of at least 50% of travel in corridors may be required 

o Identify the trade corridors in which the equipment is routinely operated 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix A: Port/Rail Yard Trucks A-7 February 2008

b) Proposed equipment project information 

• Engine repower data 

o Engine make, engine year 

o Engine horsepower and fuel type 

• Repower documentation 

o Documentation of all engine/truck modifications planned as part of the 

repower project. Include description of upgrades to such things as exhaust 

systems, electronics, etc. 

• Itemized cost information for eligible expenses (verifiable quote) 

• Predicted activity data with new equipment 

o Estimated annual VMT 

o Estimated percentage of annual VMT in trade corridors 

o Estimated number of port or rail yard visits per year (must be 150+) 

• Equipment project funding demonstration 

o Total project cost 

o Program dollars requested, including option for pro-rated alternative 

o Source and amounts of other funding (private, local, other State, federal) 

o Documentation of match funding availability 

4. Option (3): replacement 

a) Current equipment and activity information 

• Truck data 

o Truck make, model, model year 

o Vehicle Identification Number 

o Gross vehicle weight rating 

o License plate number 

o Engine make, model, engine year, serial number 

o Engine horsepower and fuel type 

o Current odometer reading (estimate total engine mileage if odometer is 

missing or broken 

• Truck documentation 

o Proof of DMV registration for current and prior two years 

o Documentation of current ownership (copy of title of truck) 

• Vocation and activity data for the past 2 years 

o Vocation(s) 

o Annual vehicle miles of travel (VMT) 

o Annual VMT in California 

o Estimated percentage of annual VMT in trade corridors 

o Average number of port or rail yard visits per year 

• Vocation and activity documentation for the past 2 years 

o Documentation of at least 50% of travel in corridors may be required 

o Identify the trade corridors in which the equipment is routinely operated 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix A: Port/Rail Yard Trucks A-8 February 2008

b) Proposed equipment project information 

• New truck data 

o Truck make, model, model year 

o Gross vehicle weight rating 

o Engine make, engine year 

o Engine horsepower and fuel type 

• Itemized cost information for eligible expenses (verifiable quote) 

• Predicted activity data with new equipment 

o Estimated annual VMT 

o Estimated percentage of annual VMT in trade corridors 

o Estimated number of port or rail yard visits per year (must be 150+) 

• Equipment project funding demonstration 

o Total project cost 

o Program dollars requested, including option for pro-rated alternative 

o Source and amounts of other funding (private, local, other State, federal) 

o Request for a direct payment to vendor (if applicable) 

o Documentation of match funding availability 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix B: Other Heavy Duty Trucks B-1 February 2008

APPENDIX B Other Heavy Duty Diesel Trucks 

A. Equipment Project Specifications 

Other Heavy Duty Diesel Trucks 

Eligible 

Equipment 

Class 8 (>33,000 lbs gross vehicle weight rating) heavy-duty diesel trucks used to move 

goods. 

Equipment owner must demonstrate: 

• Continuous registration (California base-plated or International Registration Plan) in 

California for the past 2 years. 

• At least 50 percent operation within trade corridor(s) for the past 2 years. 

Ineligible 

Equipment 

• Trucks subject to ARB’s public and utility fleet rule. 

• Trucks subject to ARB’s solid waste collection vehicle rule. 

• Trucks subject to ARB’s diesel cargo handling equipment rule. 

• A truck funded via a contract executed after adoption of the Regulation to Reduce 

Emissions of Diesel Particulate Matter, Oxides of Nitrogen and Other Criteria 

Pollutants, and Greenhouse Gases from In-Use Heavy-Duty Diesel-Fueled Vehicles

must comply with the additional restrictions on fleet averaging included in these 

Guidelines. 

Option (1) 

Retrofit 

Requirements 

Partial funding of up to $5,000/truck to retrofit an eligible MY2006 or older heavy duty 

diesel truck with an ARB verified Level 3 diesel particulate filter that reduces diesel PM by 

85 percent or more. 

• Program-funded diesel particulate filter shall be installed and operational at least 6 

months prior to a regulatory requirement for that level of emissions control under the 

best available control technology provisions of any adopted rule for in-use trucks. In 

this 6 month time period, a truck funded under this Program is not eligible to be 

included in any fleet averaging. 

Equipment owner shall: 

• Commit to at least 4 years of 100% California-only operation and California baseplated registration. Dual plates, IRP, and any other out-of-state registrations are 

prohibited. 

• Commit to at least 50% of travel in trade corridors for duration of contract term. 

• Agree to accept an on-board electronic monitoring unit at any time during the contract 

term. 

• Agree to equipment inspections. 

• Comply with record-keeping, reporting, and audit requirements. 

• Sign a legally binding contract with the local agency including project milestone and 

completion deadlines. 

• Properly maintain filter in good operating condition and according to manufacturer’s 

recommendations. 

• Demonstrate proof of equipment warranty on filter.

• Demonstrate that any mid-1990s engine subject to the software upgrades for diesel 

trucks (i.e. chip reflash) has completed the upgrade. 

• Certify that there are no outstanding ARB equipment violations associated with the 

equipment project application.
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix B: Other Heavy Duty Trucks B-2 February 2008

Other Heavy Duty Diesel Trucks (continued) 

Option (2) 

Repower 

Requirements 

Pro-rated 

Alternative 

The lower of 50% or $20,000 to repower an eligible MY2003 or older heavy duty diesel 

truck with a new engine that meets MY2007 emission levels or lower and ARB’s 

requirements for engine manufacturer diagnostics. 

• Program-funded truck repower projects shall be completed and operational at least 3 

years prior to a regulatory requirement for that level of emissions control under the best 

available control technology provisions of any adopted rule for in-use trucks. In this 3 

year period, a truck funded under this Program is not eligible to be included in any fleet 

averaging. For independent owner operators and owners of all eligible MY1997 or 

older trucks, the equipment project shall be completed and operational at least 2 years 

prior to a regulatory requirement for that level of emissions control under the best 

available control technology provisions of any adopted rule for in-use trucks. 

Equipment owner shall: 

• Commit to at least 8 years or 500,000 miles of 100% California-only operation and 

California base-plated registration. Dual plates, IRP, and any other out-of-state 

registrations are prohibited. 

• Commit to at least 50% of travel in trade corridors for duration of contract term. 

• Agree to accept an on-board electronic monitoring unit at any time during the contract 

term. 

• Agree to equipment inspections. 

• Scrap the old engine. 

• Comply with record-keeping, reporting, and audit requirements 

• Sign a legally binding contract with the local agency including project milestone and 

completion deadlines. 

• Properly maintain new engine, emission controls, and diagnostics in good operating 

condition and according to manufacturer’s recommendations. 

• Demonstrate proof of equipment warranty and comprehensive insurance on upgraded 

equipment. 

• Provide copy of ARB Executive Order documenting that the new truck engine meets 

2007 emission levels. 

• Certify that there are no outstanding ARB equipment violations associated with the 

equipment project application. 

Equipment owners may opt for a pro-rated alternative consisting of duplicate requirements, 

except that the Program will pay the lower of 25% or $10,000 for a 4 year commitment of 

100% California-only operation and California base-plated registration. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix B: Other Heavy Duty Trucks B-3 February 2008

Other Heavy Duty Diesel Trucks (continued) 

Option (3) 

Replacement 

Requirements 

Pro-rated 

Alternative 

Partial funding of up to $50,000/truck to replace an eligible MY2003 or older heavy duty 

diesel truck with a diesel or alternative fuel truck meeting MY2007 emission levels or 

lower. 

• Program-funded truck replacement projects shall be completed and operational at 

least 3 years prior to a regulatory requirement for that level of emissions control 

under the best available control technology provisions of any adopted rule for in-use 

trucks. In this 3 year period, a truck funded under this Program is not eligible to be 

included in any fleet averaging. For independent owner operators and owners of all 

eligible MY1997 or older trucks, the equipment project shall be completed and 

operational at least 2 years prior to a regulatory requirement for that level of 

emissions control under the best available control technology provisions of any 

adopted rule for in-use trucks. 

Equipment owner shall: 

• Commit to at least 8 years or 500,000 miles of 100% California-only operation and 

California base-plated registration. Dual plates, IRP, and any other out-of-state 

registrations are prohibited. 

• Commit to at least 50% of travel in trade corridors for duration of contract term. 

• Agree to accept an on-board electronic monitoring unit at any time during the 

contract term. 

• Agree to equipment inspections. 

• Scrap the old truck. 

• Comply with record-keeping, reporting, and audit requirements 

• Sign a legally binding contract with the local agency including project milestone and 

completion deadlines. Under a lease program, the owner and lessee must sign the 

contract. 

• Properly maintain new truck in good operating condition and according to 

manufacturer’s recommendations. 

• Demonstrate proof of equipment warranty and comprehensive insurance on new 

truck. 

• Provide copy of ARB Executive Order documenting that the new truck engine meets 

2007 emission levels. 

• Certify that there are no outstanding ARB equipment violations associated with the 

equipment project application. 

Equipment owners may opt for a pro-rated alternative consisting of duplicate 

requirements, except that the Program will pay up to $25,000 for a 4 year commitment of 

100% California-only operation and California base-plated registration. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix B: Other Heavy Duty Trucks B-4 February 2008

Other Heavy Duty Diesel Trucks (continued) 

Option (4) 

Three-Way Truck Transactions 

Additional 

Requirements for 

Eligible 

Equipment 

Truck A: MY2003-2006 heavy duty diesel truck 

Truck B: MY1990 or older heavy duty diesel truck 

Option (4) 

Three-Way Truck 

Transactions 

Requirements 

Partial funding of up to $50,000/transaction to: 

1. Replace an eligible MY2003-2006 truck (Truck A) with a diesel or alternative 

fuel truck (Truck C) meeting MY2007 emissions levels or lower; and 

2. Equip Truck A with an ARB-verified Level 3 diesel particulate filter that 

reduces diesel PM by 85 percent or more; and 

3. Scrap a MY1990 or older diesel truck (Truck B) and replace with Truck A. 

• Program-funded three-way truck transaction shall be completed and the new 

truck operational at least 2 years prior to a regulatory requirement for a truck 

meeting MY2007 emission standards under the best available control 

technology provisions of any adopted rule for in-use trucks. In this 2 year 

period, a truck funded under this Program is not eligible to be included in any 

fleet averaging. If the original owner of Truck A and new owner of Truck C is 

an independent owner operator, Truck C must be operational at least 2 

years prior to a regulatory requirement for a truck meeting MY2007 emission 

standards. 

• Truck A shall be equipped with a diesel particulate filter at least six months 

prior to a regulatory requirement for a Level 3 PM device under the best 

available control technology provisions of any adopted rule for in-use trucks. 

Original owner of Truck A and new owner of new Truck C shall: 

• Equip Truck A with a Level 3 diesel particulate filter and transfer ownership 

(if applicable) to the owner of old Truck B. 

• On Truck C, commit to at least 8 years or 500,000 miles of 100% Californiaonly operation and California base-plated registration. Dual plates, IRP, and 

any other out-of-state registrations are prohibited. 

• On Truck C, commit to at least 50% of travel in trade corridors for duration of 

contract term. 

• Agree to accept an on-board electronic monitoring unit at any time during the 

contract term. 

• Agree to equipment inspections. 

• Comply with record-keeping, reporting, and audit requirements. 

• Sign a legally binding contract with the local agency including project 

milestone and completion deadlines. 

• Properly maintain new truck in good operating condition and according to 

manufacturer’s recommendations. 

• Demonstrate proof of equipment warranty and comprehensive insurance on 

new truck. 

• Provide copy of ARB Executive Order documenting that Truck C engine 

meets 2007 emission levels, and the Truck A is certified for sale in 

California. 

• Certify that there are no outstanding ARB equipment violations associated 

with any of the trucks involved in the equipment project. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix B: Other Heavy Duty Trucks B-5 February 2008

Other Heavy Duty Diesel Trucks (continued) 

Option (4) 

Three-Way Truck 

Transactions 

Requirements 

(continued) 

Original owner of old Truck B and new owner of retrofit Truck A shall: 

• Scrap Truck B. 

• On Truck A, commit to at least 4 years of 100% California-only operation and 

California base-plated registration. Dual plates, IRP, and any other out-ofstate registrations are prohibited. 

• On Truck A, commit to at least 50% of travel in trade corridors for duration of 

contract term. 

• Agree to equipment inspections. 

• Comply with record-keeping, reporting, and audit requirements. 

• Sign a legally binding contract with the local agency including project 

milestone and completion deadlines. 

• Properly maintain filter in good operating condition and according to 

manufacturer’s recommendations. 

• Demonstrate proof of equipment warranty on filter.

• Certify that there are no outstanding ARB equipment violations associated 

with any of the trucks involved in the equipment project. 

Project Cost 

Assumptions 

Option (1): Total cost of a diesel particulate filter is ~$10,000. 

Option (2): Total average cost of a repower project is ~$40,000. 

Option (3) & (4): Total cost of a new MY2007 truck is ~$100,000 (diesel) to 

~$180,000 (natural gas). 

B. Major Milestones for Project Completion 

• Equipment order. 

• Equipment acquisition/installation. 

• Submittal of invoice to local agency for reimbursement. 

• 1st reporting milestone 6 months after equipment project completion. 

C. Recordkeeping Requirements 

Equipment owners shall retain, at minimum, all documents, invoices, and 

correspondence associated with the application, award, contract, monitoring, 

enforcement, and reporting requirements at least two years after equipment project 

contact term or three years after final payment, whichever is later. Records shall be 

readily available and accessible to the local agency, ARB, or designee upon request for 

the purposes of ongoing evaluations or auditing. 

D. Annual Reporting Requirements 

Equipment owners shall be responsible for annual reporting to the local agency that 

includes, but is not limited to: 

• Contact information (owner name, address, phone, etc.). 

• Proof of California registration. 

• Annual vehicle miles of travel (including mileage/activity logs for documentation). 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix B: Other Heavy Duty Trucks B-6 February 2008

• Certification of California-only operation (including certification that permits were not 

utilized to make out-of-state trips). 

• Certification and documentation of at least 50% of travel in trade corridors. 

• Summary of maintenance performed and inspections conducted. 

• Certification that the bond-funded project was operated in accordance with signed 

contract and that all information submitted is true and accurate. 

• Other information as requested by the local agency. 

E. Ongoing Evaluations and Audits 

Equipment owners shall agree to ongoing equipment project evaluations and equipment 

project audits by the local agency, ARB, or authorized designees. ARB and local 

agency audit requirements and provisions are found in Chapter II.E.5.

F. Application Information 

Equipment owners shall provide the following information and documentation in addition 

to the requirements described in Chapter IV and other information ARB or local 

agencies may request on the equipment project applications. 

1. General contact information 

This section applies to all equipment project options listed below. 

• Name/organization/agency/company 

• Mailing address 

• Primary contact name and phone number 

• Person with equipment contract signing authority (Owner) 

• Proof of identity of equipment owner 

• Small business information 

o Fleet size 

o Number of employees 

o Annual gross income 

2. Option (1): retrofit 

a) Current equipment and activity information 

• Truck data 

o Truck make, model, model year 

o Vehicle Identification Number 

o Gross vehicle weight rating 

o License plate number 

o Engine make, model, engine year, serial number 

o Engine horsepower and fuel type 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix B: Other Heavy Duty Trucks B-7 February 2008

o Current odometer reading (estimate total engine mileage if odometer is 

missing or broken 

• Truck documentation: 

o Proof of DMV registration for current and prior two years 

o Documentation of current ownership (copy of title of truck) 

• Vocation and activity data for the past 2 years 

o Vocation(s) 

o Annual vehicle miles of travel (VMT) 

o Annual VMT in California 

o Estimated percentage of annual VMT in trade corridors 

• Vocation and activity documentation for the past 2 years 

o Documentation of at least 50% of travel in corridors may be required 

o Identify the trade corridors in which the equipment is routinely operated 

b) Proposed equipment project information 

• Retrofit device data 

o ARB-verified retrofit device company and name of device 

o ARB Executive Order number for retrofit device 

o ARB-verified NOx reduction & PM reduction (%) 

• Itemized cost information for eligible expenses (verifiable quote) 

• Predicted activity data with new equipment 

o Estimated annual VMT 

o Estimated percentage of annual VMT in trade corridors 

• Equipment project funding demonstration 

o Total project cost 

o Program dollars requested 

o Source and amounts of other funding (private, local, other State, federal) 

o Request for a direct payment to vendor (if applicable) 

o Documentation of match funding availability 

3. Option (2): repower 

a) Current equipment and activity information 

• Truck data 

o Truck make, model, model year 

o Vehicle Identification Number 

o Gross vehicle weight rating 

o License plate number 

o Engine make, model, engine year, serial number 

o Engine horsepower and fuel type 

• Truck documentation 

o Proof of DMV registration for current and prior two years 

o Documentation of current ownership (copy of title of truck) 

• Vocation and activity data for the past 2 years 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix B: Other Heavy Duty Trucks B-8 February 2008

o Vocation(s) 

o Annual vehicle miles of travel (VMT) 

o Annual VMT in California 

o Estimated percentage of annual VMT in trade corridors 

• Vocation and activity documentation for the past 2 years 

o Documentation of at least 50% of travel in corridors may be required 

o Identify the trade corridors in which the equipment is routinely operated 

b) Proposed equipment project information 

• Engine repower data 

o Engine make, engine year 

o Engine horsepower and fuel type 

• Repower documentation 

o Documentation of all engine/truck modifications planned as part of the 

repower project. Include description of upgrades to such things as exhaust 

systems, electronics, etc. 

• Itemized cost information for eligible expenses (verifiable quote) 

• Predicted activity data with new equipment 

o Estimated annual VMT 

o Estimated percentage of annual VMT in trade corridors 

• Equipment project funding demonstration 

o Total project cost 

o Program dollars requested, including option for pro-rated alternative 

o Source and amounts of other funding (private, local, other State, federal) 

o Documentation of match funding availability 

4. Option (3): replacement 

a) Current equipment and activity information 

• Truck data 

o Truck make, model, model year 

o Vehicle Identification Number 

o Gross vehicle weight rating 

o License plate number 

o Engine make, model, engine year, serial number 

o Engine horsepower and fuel type 

• Truck documentation 

o Proof of DMV registration for current and prior two years 

o Documentation of current ownership (copy of title of truck) 

• Vocation and activity data for the past 2 years 

o Vocation(s) 

o Annual vehicle miles of travel (VMT) 

o Annual VMT in California 

o Estimated percentage of annual VMT in trade corridors 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix B: Other Heavy Duty Trucks B-9 February 2008

• Vocation and activity documentation for the past 2 years 

o Documentation of at least 50% of travel in corridors may be required 

o Identify the trade corridors in which the equipment is routinely operated 

b) Proposed equipment project information 

• New truck data 

o Truck make, model, model year 

o Gross vehicle weight rating 

o Engine make, engine year 

o Engine horsepower and fuel type 

• Itemized cost information for eligible expenses (verifiable quote) 

• Predicted activity data with new equipment 

o Estimated annual VMT 

o Estimated percentage of annual VMT in trade corridors 

• Equipment project funding demonstration 

o Total project cost 

o Program dollars requested, including option for pro-rated alternative 

o Source and amounts of other funding (private, local, other State, federal) 

o Request for a direct payment to vendor (if applicable) 

o Documentation of match funding availability 

5. Option (4): three-way truck transaction 

a) TRUCK A: Current equipment and activity information 

• Truck data 

o Truck make, model, model year (must be MY2003-2006) 

o Vehicle Identification Number 

o Gross vehicle weight rating 

o License plate number 

o Engine make, model, engine year, serial number 

o Engine horsepower and fuel type 

o Current odometer reading (estimate total engine mileage if odometer is 

missing or broken 

• Truck documentation 

o Proof of DMV registration for current and prior two years 

o Documentation of current ownership (copy of title of truck) 

• Vocation and activity data for the past 2 years 

o Vocation(s) 

o Annual vehicle miles of travel (VMT) 

o Annual VMT in California 

o Estimated percentage of annual VMT in trade corridors 

• Vocation and activity documentation for the past 2 years 

o Documentation of at least 50% of travel in corridors may be required 

o Identify the trade corridors in which the equipment is routinely operated 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix B: Other Heavy Duty Trucks B-10 February 2008

b) TRUCK B: Current equipment and activity information 

• Truck data 

o Truck make, model, model year (must be MY1990 or older) 

o Vehicle Identification Number 

o Gross vehicle weight rating 

o License plate number 

o Engine make, model, engine year, serial number 

o Engine horsepower and fuel type 

o Current odometer reading (estimate total engine mileage if odometer is 

missing or broken 

• Truck documentation 

o Proof of DMV registration for current and prior two years 

o Documentation of current ownership (copy of title of truck) 

• Vocation and activity data for the past two years 

o Vocation(s) 

o Annual vehicle miles of travel (VMT) 

o Annual VMT in California 

o Estimated percentage of annual VMT in trade corridors 

• Vocation and activity documentation for the past 2 years 

o Documentation of at least 50% of travel in corridors may be required 

o Identify the trade corridors in which the equipment is routinely operated 

c) Proposed equipment project information 

TRUCK A 

• Retrofit device data 

o ARB-verified retrofit device company and name of device 

o ARB Executive Order number for retrofit device, NOx & PM reduction (%) 

• Predicted vocation and activity data 

o Vocation(s) 

o Estimated annual VMT 

o Estimated percentage of annual VMT in trade corridors 

TRUCK C 

• New truck data 

o Truck make, model, model year (must be MY2007 or newer) 

o Gross vehicle weight rating 

o Engine make, engine year, engine horsepower and fuel type 

• Itemized cost information for eligible expenses (verifiable quote) 

• Predicted vocation and activity data 

o Vocation(s) 

o Estimated annual VMT 

o Estimated percentage of annual VMT in trade corridors 

• Equipment project funding demonstration 

o Total project cost 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix B: Other Heavy Duty Trucks B-11 February 2008

o Program dollars requested, including option for pro-rated alternative 

o Source and amounts of other funding (private, local, other State, federal) 

o Request for a direct payment to vendor (if applicable) 

o Documentation of match funding availability 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix C: Locomotives C-1 February 2008

APPENDIX C Locomotives 

A. Equipment Project Specifications 

Locomotives 

Eligible 

Equipment 

Diesel-powered freight locomotives with no or minimal emissions control technology 

(i.e., uncontrolled, or meeting Tier 0 or Tier 1 standards). 

Equipment owner must demonstrate: 

• Operation in California for the past 2 years. 

• At least 50 percent operation within trade corridor(s) for the past 2 years. 

• Estimated diesel fuel usage greater than 20,000 gallons per year. 

Option (1): 

Switcher 

Locomotive 

Requirements 

Partial funding for the lower of 50% or $750,000 per locomotive to replace, rebuild, or 

repower an uncontrolled, Tier 0 or Tier 1 switcher locomotive with a new generator-set that 

achieves emissions of 3.5g/bhp-hr or less for NOx, and 0.1 g/bhp-hr or less for PM, or an 

alterative technology with equivalent emission levels using U.S. EPA engine certification 

test results with ARB verification. Eligible locomotive costs include a new chassis, a new 

or rebuilt engine, and mechanical/electrical systems components necessary for safe 

operation. 

Equipment owner shall: 

• Commit to 15 years of 100% operation within the trade corridors; periodic out-of-state 

maintenance may be permitted if outlined in the contract between the local agency and 

equipment owner. 

• Scrap or ban old engine/locomotive from California operation. 

• Install an active GPS unit on both old (if not scrapped) and new equipment, fund data 

collection, and report location data. 

• Agree to equipment inspections. 

• Comply with record-keeping, reporting, and audit requirements. 

• Sign a legally binding contract with the local agency including project milestone and 

completion deadlines. 

• Properly maintain upgraded equipment in good operating condition and according to 

manufacturer’s recommendations. 

• Demonstrate proof of equipment warranty and comprehensive insurance on upgraded 

equipment. 

• (For UP and BNSF) Demonstrate how the railroad intends to comply with 1998 

agreement for the South Coast Air Basin by submitting a compliance plan to ARB prior 

to application for bond funding in the Los Angeles/Inland Empire corridor. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix C: Locomotives C-2 February 2008

Locomotives (continued) 

Option (2): 

Line-Haul 

Locomotive 

 

Requirements 

Partial funding for the lower of 50% or $1 million per locomotive to replace or rebuild an 

uncontrolled, Tier 0 or Tier 1 line-haul locomotive with a new Tier 2 or lower-emission

engine. Eligible locomotive costs include a new chassis, a new or rebuilt engine, and 

mechanical/electrical systems components necessary for safe operation. 

Equipment owner shall: 

• Commit to 15 years of 100% California-only operation. This new intrastate line-haul 

locomotive shall use California ARB diesel fuel. Periodic out-of-state maintenance may 

be permitted if outlined in the contract between the local agency and equipment owner. 

• Commit to at least 50% of operation in trade corridors for duration of contract term. 

• Scrap or ban old engine/locomotive from California operation. 

• Install an active GPS unit on both old (if not scrapped) and new equipment, fund data 

collection, and report location data. 

• Agree to equipment inspections. 

• Comply with record-keeping, reporting, and audit requirements. 

• Sign a legally binding contract with the local agency including project milestone and 

completion deadlines. 

• Properly maintain upgraded equipment in good operating condition and according to 

manufacturer’s recommendations. 

• Demonstrate proof of equipment warranty and comprehensive insurance on upgraded 

equipment. 

• (For UP and BNSF) Demonstrate how the railroad intends to comply with the 1998 

agreement for the South Coast Air Basin by submitting a compliance plan to ARB prior 

to application for bond funding in the Los Angeles/Inland Empire corridor. 

Project Cost 

Assumptions 

• Estimated total cost of new switcher generator-set is ~$1.5 million. 

• Estimated total cost of an eligible Tier 2 locomotive is ~$2.0-2.5 million. 

Excluded 

Funding 

Components 

• Auto start/stop devices required by regulation or agreements. 

• GPS units and monitoring and reporting costs. 

• 

B. Major Milestones for Project Completion 

• Equipment order. 

• Equipment acquisition/installation. 

• Submittal of invoice to local agency for reimbursement. 

• 1st reporting milestone 6 months after equipment project completion. 

C. Recordkeeping Requirements 

Equipment owners shall retain, at minimum, all documents, invoices, and 

correspondence associated with the application, award, contract, monitoring, 

enforcement, and reporting requirements at least two years after equipment project 

contact term or three years after final payment, whichever is later. Records shall be 

readily available and accessible to the local agency, ARB, or designee upon request for 

the purposes of ongoing evaluations or auditing. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix C: Locomotives C-3 February 2008

D. Annual Reporting Requirements 

Equipment owners shall be responsible for annual reporting to the local agency that 

includes, but is not limited to: 

• Contact information (owner name, company, address, phone). 

• Build number, date, builder, builder model. 

• Date of equipment installation. 

• Locomotive type and name of home rail yard. 

• Report of Megawatt-hours of operation. 

• Representative profile data to determine engine duty cycle. 

• Certification of California-only operation. 

• Summary of maintenance performed (including location) and inspections conducted. 

• GPS data in a usable format. 

• Certification and documentation of 100% of travel in trade corridors for switcher 

locomotives, and 50% operation in trade corridors for line-haul locomotives. 

• Certification that the bond-funded project was used in accordance with signed 

contract and that all information submitted is true and accurate. 

• Other information as requested by ARB or the local agency. 

E. Ongoing Evaluations and Audits 

Equipment owners shall agree to ongoing equipment project evaluations and equipment 

project audits by the local agency, ARB, or authorized designees. ARB and local 

agency audit requirements and provisions are found in Chapter II.E.5.

F. Application Information 

• Equipment owners shall provide the following information and documentation in 

addition to the requirements described in Chapter IV and other information ARB or 

local agencies may request on the equipment project applications. 

• UP and BNSF must demonstrate how the railroad intends to comply with the 1998 

agreement for the South Coast Air Basin by submitting a compliance plan to ARB 

prior to application for bond funding in the Los Angeles/Inland Empire corridor. 

1. General contact information 

This section applies to all equipment project options listed below. 

• Organization/agency/company name 

• Railroad Class (1, 2, or 3) 

• Mailing address 

• Primary contact name and phone number 

• Person with equipment contract signing authority (Owner) 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix C: Locomotives C-4 February 2008

• Proof of identity of equipment owner 

• Small business information 

o Number of locomotives 

o Number of employees 

o Annual gross income 

2. Option (1): switcher locomotive 

a) Current equipment and activity information 

• Switcher data 

o Locomotive type (traditional switcher, alternative technology switcher) 

o Build number, date 

o Builder, builder model 

o Locomotive make, model, model year, serial number, roster number 

o Engine data (per engine) 

 Modifications (roots blown, turbo-charged, other) 

 Control level (uncontrolled, Tier 0, 1) 

 Engine family, make and type, model, engine year 

 Serial number 

 Horsepower, number of cylinders 

 Fuel type 

o Electronic monitoring unit device type and model (if equipped) 

• Switcher documentation 

o Documentation of current ownership 

• Activity data for the past 2 years 

o Annual fuel consumption (gallons of fuel) 

o Annual megawatt hours of operation 

o Profile of locomotive duty cycle (i.e., idle time, throttle notch settings per 

increment of time for each engine) 

• Activity documentation for past 2 years 

o Documentation of at least 50% of operation in corridors may be required 

o Identify the trade corridors in which the equipment is routinely operated 

o Documentation of fuel consumption may be requested

o Documentation of megawatt hours of operation may be requested 

b) Proposed equipment project information 

• New switcher data 

o Locomotive type (traditional switcher, alternative technology switcher) 

o Builder 

o Locomotive make and model year 

o Engine data (per engine) 

 Modifications (roots blown, turbo-charged, other) 

 Emission rate certified by U.S. EPA & verified by ARB (PM, NOx in 

g/bhp-hr) 

 Engine family, make and engine year 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix C: Locomotives C-5 February 2008

 Horsepower, number of cylinders 

 Fuel type 

o Electronic monitoring device unit type and a description or sample of the 

type/format of reportable data 

• Itemized cost information for eligible expenses (verifiable quote) 

o Locomotive, engine, or generator set (as applicable) 

o Other equipment/materials 

• Predicted activity data with new equipment 

o Estimated annual fuel consumption (gallons of fuel) 

o Estimated annual megawatt hours of operation 

o Estimated profile of locomotive duty cycle (i.e., idle time, throttle notch 

settings per increment of time for each engine) 

• Equipment project funding demonstration 

o Total project cost 

o Program dollars requested 

o Funding sources and amounts of other funding (private, local, other State, 

federal) 

o Documentation of match funding availability 

3. Option (2): line-haul locomotive 

a) Current equipment and activity information 

• Line-haul data 

o Locomotive type 

o Build number, date 

o Builder, builder model 

o Locomotive make, model, model year, serial number, roster number 

o Engine data (per engine) 

 Modifications (roots blown, turbo-charged, other) 

 Control level (uncontrolled, Tier 0, 1) 

 Engine family, make and type, model, engine year 

 Serial number 

 Horsepower, number of cylinders 

 Fuel type 

o Electronic monitoring unit device type and model (if equipped) 

• Line-haul documentation 

o Documentation of current ownership 

• Activity data for the past 2 years 

o Annual fuel consumption (gallons of fuel) 

o Annual megawatt hours of operation 

o Profile of locomotive duty cycle (i.e., idle time, throttle notch settings per 

increment of time for each engine) 

• Activity documentation for past 2 years 

o Documentation of at least 50% of travel in corridors may be required 

o Identify the trade corridors in which the equipment is routinely operated 

o Documentation of fuel consumption may be requested
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix C: Locomotives C-6 February 2008

o Documentation of megawatt hours of operation may be requested 

b) Proposed equipment project information 

• New line-haul data 

o Locomotive type 

o Builder 

o Locomotive make and model year 

o Engine data (per engine) 

 Modifications (roots blown, turbo-charged, other) 

 Control level (must be certified to Tier 2 emission levels or lower) 

 Engine family, make and engine year 

 Horsepower, number of cylinders 

 Fuel type 

o Electronic monitoring device unit type and a description or sample of the 

type/format of reportable data 

• Itemized cost information for eligible expenses (verifiable quote) 

o Locomotive or engine (as applicable) 

o Other equipment/materials 

• Predicted activity data with new equipment 

o Estimated annual fuel consumption (gallons of fuel) 

o Estimated annual megawatt hours of operation 

o Estimated profile of locomotive duty cycle (i.e., idle time, throttle notch 

settings per increment of time for each engine) 

• Equipment project funding demonstration 

o Total project cost 

o Program dollars requested 

o Funding sources and amounts of other funding (private, local, other State, 

federal) 

o Documentation of match funding availability 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix D: Shore Power D-1 February 2008

APPENDIX D Shore Power 

A. Equipment Project Specifications 

Shore Power

Eligible 

Equipment 

Existing cargo ship berth or existing cargo ship terminal at a seaport located in a trade 

corridor. 

Option (1) 

Grid-Based 

Power 

Requirements 

The lower of $2.5 million/berth or 50% of the covered shore-side costs of installing 

permanent, grid-based electrical power at a cargo ship berth. 

• Program-funded grid-based shore power shall be installed and in operation at least 2 

years prior to a regulatory requirement for that technology or level of emissions control. 

 

Equipment owner shall: 

• Commit to at least 20 years of the use of grid-based shore power at the berth at the 

following levels or greater: 

o 25 percent of ship visits in 2011-2013. 

o 60 percent of the ship visits in 2014-2016. 

o 70 percent of the ship visits in 2017-2019. 

o 90 percent of the ship visits in 2020 and beyond. 

• Agree to equipment inspections that include demonstrated operability with a cargo ship 

fully powered by shore-based electrical power. 

• Comply with record-keeping, reporting, and audit requirements. 

• Sign a legally binding contract with the local agency including project milestone and 

completion deadlines. 

• Comply with all permitting requirements. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix D: Shore Power D-2 February 2008

Shore Power (continued) 

Option (2) 

Non-grid 

based power 

Requirements 

Pro-rated 

Alternative 

Partial funding of up to $200,000 per megawatt of the covered costs of an electricity 

generating unit that provides power at a cargo ship berth or multiple berths. This unit can 

be portable or fixed on the terminal. Only zero emission units (e.g. fuel cell, solar), or 

natural gas engines equipped with selective catalytic reduction to control NOx emissions 

are eligible. 

• Program-funded non grid-based shore power shall be installed and in operation by 

January 1, 2010. 

Equipment owner shall: 

• Commit to 7 years of 100% California operation at the following levels or greater: 

o 

o 1,000 hours per year in 2010-2011. 

o 2,000 hours per year in 2012-2013. 

o 3,000 hours per year in 2014 and beyond. 

• Agree to equipment inspections that include demonstrated operability with a cargo ship 

fully powered by shore-based electrical power supplied by the electricity generating 

unit. 

• Comply with record-keeping, reporting, and audit requirements. 

• Sign a legally binding contract with the local agency including project milestone and 

completion deadlines. 

• Properly maintain equipment in good operating condition and according to 

manufacturer’s recommendations. 

• Demonstrate proof of equipment warranty. 

• Comply with all local permitting requirements. 

• Perform source testing to measure emissions from the unit every 1,000 hours of 

operation, according to the source test requirements contained in ARB’s shore power 

regulation. 

Equipment owners may opt for a pro-rated alternative consisting of duplicate requirements, 

except that the Program will pay up to $140,000 per megawatt for a 5 year commitment to 

use non-grid based shore power in 100% California operation. 

Project Cost 

Assumptions 

• Total shoreside cost of equipping a berth with permanent grid-based electrical power is 

~$5.0 million/berth; some ports may incur additional costs to bring new/additional 

power capacity to the port. 

• Total cost of distributed generation power is anticipated to be $4.0 million/ 2 MW unit. 

• Shipside modifications will cost ~$1 million/ship.

Excluded 

Funding 

Components 

• Providing additional electrical power to the port.

• Construction and protection of infrastructure (e.g., natural gas lines) used to supply fuel 

for non-grid based electrical generation. 

• Shipside modifications to accept shore-based electrical power. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix D: Shore Power D-3 February 2008

B. Major Milestones for Project Completion 

• Preliminary design. 

• Environmental clearance (if applicable). 

• Final design. 

• Equipment acquisition (if applicable). 

• Construction bid award. 

• Construction completion/equipment installation. 

• Submittal of invoice to local agency for reimbursement. 

• 1st reporting milestone 6 months after equipment project completion. 

C. Recordkeeping Requirements 

Equipment owners shall retain, at minimum, all documents, invoices, and 

correspondence associated with the application, award, contract, monitoring, 

enforcement, and reporting requirements at least two years after equipment project 

contact term or three years after final payment, whichever is later. Records shall be 

readily available and accessible to the local agency, ARB, or designee upon request for 

the purposes of ongoing evaluations or auditing. 

D. Reporting Requirements 

Equipment owners shall be responsible for annual reporting to the local agency that 

includes, but is not limited to: 

1. Annual reporting for grid based power 

• Contact information (owner name, company, address, phone). 

• Equipment description and type providing electrical power. 

• Berth name/identifier. 

• Date of installation of equipment. 

• Vessel type, name, and Lloyd’s number of vessels utilizing berth. 

• Date(s) and time each vessel was initially connected to shore power and 

subsequently disconnected. 

• Monthly utility statements that separately identify electricity for shore power (if avail). 

• Documentation of electricity usage at berth (if billing statements are unavailable). 

• Episodes of electrical service interruption by local utility company, as confirmed and 

documented by local utility company. 

• Summary of maintenance and inspections conducted. 

• Signed Certification statement that the bond-funded project was operated in 

accordance with signed contract and that all information submitted is true and 

accurate. 

• Project records must be retained for at least two years after contract expiration or 

three years after final project payment, whichever is later. 

• Other information as requested by the local agency. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix D: Shore Power D-4 February 2008

2. Annual reporting for non-grid based power (every 1,000 hours) 

• Contact information (owner name, company, address, phone). 

• Equipment description and type providing electrical power. 

• Berth name/identifier. 

• Date and location of installation of equipment. 

• Vessel type, name, and Lloyd’s number of vessels utilizing shore power. 

• Location of vessels serviced, by berth. 

• Date(s) and time the vessel utilized non-grid based power. 

• Power, in megawatts, supplied to the vessels. 

• Date(s) and time each vessel was initially connected to shore power and 

subsequently disconnected. 

• Date, time, and description of any equipment failure that affected the ability of vessel 

to turn off its auxiliary engines or use alternative control technologies to reduce 

emissions. 

• Summary of maintenance and inspections conducted. 

• Signed Certification statement that the bond-funded project was operated in 

accordance with signed contract and that all information submitted is true and 

accurate. 

• Other information as requested by the local agency. 

E. Ongoing Evaluations and Audits 

Equipment owners shall agree to ongoing equipment project evaluations and equipment 

project audits by the local agency, ARB, or authorized designees. ARB and local 

agency audit requirements and provisions are found in Chapter II.E.5.

F. Application Information 

Equipment owners shall provide the following information and documentation in addition 

to the requirements described in Chapter IV and other information ARB or local 

agencies may request on the equipment project applications. 

1. General contact information 

This section applies to all equipment project options listed below. 

• Organization/agency/company name 

• Mailing address 

• Primary contact name and phone number 

• Person(s) with equipment contract signing authority (Owner) 

• Proof of identity of equipment owner 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix D: Shore Power D-5 February 2008

2. Option (1): grid-based shore power 

a) Proposed equipment project information 

• Project Information 

o Port where the berth is located 

o Berth name/identifier and location within port 

o Owner and operator of berth 

o Project description, design, maximum power demand (megawatts) 

o Itemized cost information by phase (e.g. design, environmental, construction) 

• Documentation of current ownership may be required

• Berth activity data for the past 2 years 

o Number of ship visits to the berth 

• Ship information (per ship and berth) 

o Number of visits per year 

o Average hotelling time per visit (hours/visit) 

o Ship type, size (e.g. TEU capacity), description (e.g. number of engines, fuel 

type), power demand (total auxiliary power (kW), net hotelling load (kW)) 

• Predicted berth activity data with new equipment 

o Estimated monthly hours of operation 

o Estimated monthly MW usage 

o Estimated annual ship visits using electrical power 

o Estimated ship types, description, power demands 

• Equipment project funding demonstration 

o Total project cost 

o Program dollars requested 

o Funding sources and amounts of other funding (private, local, other State, 

federal) 

o Documentation of match funding availability 

3. Option (2): non-grid shore power 

a) Proposed equipment project information 

• Project Information 

o Port where the berths are located 

o Berth(s) name/identifier and location within port 

o Owner and operator of berth 

o Project description, design, maximum power demand (megawatts) 

o Itemized cost information for eligible expenses (verifiable quote) 

• Documentation of current ownership may be required

• Berth activity data for the past 2 years (per berth) 

o Number of ship visits to the berth 

• Ship information (per ship and berth) 

o Number of visits per year 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix D: Shore Power D-6 February 2008

o Average hotelling time per visit (hours/visit) 

o Ship type, size (e.g. TEU capacity), description (e.g. number of engines, fuel 

type), power demand (total auxiliary power (kW), net hotelling load (kW)) 

• Predicted activity data with new equipment 

o Estimated monthly hours of operation 

o Estimated monthly MW usage 

o Estimated annual ship visits using electrical power 

o Estimated ship types, description, power demands 

• Equipment project funding demonstration 

o Total project cost 

o Program dollars requested, including option for pro-rated alternative 

o Funding sources and amounts of other funding (private, local, other State, 

federal)

o Documentation of match funding availability
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix E: Harbor Craft E-1 February 2008

APPENDIX E Commercial Harbor Craft 

A. Equipment Project Specifications 

Commercial Harbor Craft

Eligible 

Equipment 

Existing commercial diesel harbor craft vessels involved in freight movement operations 

with: a home port located in a trade corridor, 2 years of operation in California waters, and 

uncontrolled (Tier 0) diesel propulsion engine(s). Eligible vessel types include: 

• Tugboats and towboats. 

• Work, pilot, crew and supply boats. 

• Commercial fishing boats with at least 700 operational hours per year. 

Option (1) 

Replacement/ 

repower of 

tugs/tows 

Requirements 

Pro-rated 

Alternative 

For repowers on tugs and tows, the lower of 50% of total cost or $135/horsepower of the 

old engine to replace a Tier 0 propulsion engine with a new model engine meeting latest 

emission standards (Tier 2 or lower emissions) and make necessary vessel modifications 

to accommodate the new engine. For replacements of tugs and tows, the lower of 50% of 

total cost or $135/horsepower of the engine in the old vessel to replace a vessel with a Tier 

0 propulsion engine with a new vessel powered by an engine meeting latest emission 

standards (Tier 2 or lower emissions). 

• Program-funded engine repowers and replacements for tugboats and towboats shall be 

in operation at least 2 years prior to a regulatory requirement for that technology or 

level of emissions control. 

Equipment owner shall: 

• Commit to 15 years of California home port operation in the trade corridors. 

• Scrap old engine or vessel (as applicable). 

• Agree to accept an electronic monitoring unit at any time during the contract term. 

• Agree to equipment inspections. 

• Comply with record-keeping, reporting, and audit requirements. 

• Sign a legally binding contract with the local agency including project milestone and 

completion deadlines. 

• Demonstrate proof of comprehensive insurance on upgraded equipment. 

• Properly maintain upgraded equipment in good operating condition and according to 

manufacturer’s recommendations. 

• Certify that there are no outstanding ARB equipment violations associated with the 

equipment project application. 

Equipment owner may opt for a pro-rated alternative consisting of duplicate requirements, 

except that the Program will pay up to half of the Program funding level described above 

for a 7 year commitment of California home port operation in the trade corridors. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix E: Harbor Craft E-2 February 2008

Harbor Craft (continued) 

Option (2) 

Replacement/ 

repower of 

other vessels 

Requirements 

Pro-rated 

Alternative 

Other vessel types may include: work, pilot, crew, or supply boats involved in freight 

movement operations; and high use commercial fishing vessels. For repowers of other 

vessels, the lower of 80% or $215/horsepower of the old engine to replace a Tier 0 

propulsion engine with a new model meeting latest emission standards (Tier 2 or better) and 

make necessary vessel modifications to accommodate the new engine. For replacements of 

other vessels, the lower of 80% or $215/horsepower of the engine in the old vessel to 

replace a vessel with a Tier 0 propulsion engine with a new vessel powered by an engine 

meeting latest emission standards (Tier 2 or lower emissions) 

Equipment owner shall: 

• Commit to 10 years of 100% California home port operation in trade corridors. 

• Scrap old engine or vessel (as applicable). 

• Agree to accept an electronic monitoring unit at any time during the contract term. 

• Agree to equipment inspections. 

• Comply with record-keeping, reporting, and audit requirements. 

• Sign a legally binding contract with the local agency including project milestone and 

completion deadlines. 

• Demonstrate proof of comprehensive insurance on upgraded equipment. 

• Properly maintain upgraded equipment in good operating condition and according to 

manufacturer’s recommendations. 

• Certify that there are no outstanding ARB equipment violations associated with the 

equipment project application. 

Equipment owner may opt for a pro-rated alternative consisting of duplicate requirements, 

except that the Program will pay up to half of the Program funding level described above for 

a 5 year commitment of California home port operation in the trade corridors. 

Project Cost 

Assumptions 

• Total cost of a Tier 2 engine is estimated at $270/horsepower. 

Excluded 

Funding 

Components 

• Out of service time (dry dock) costs. 

B. Major Milestones for Project Completion 

• Equipment order. 

• Dry dock scheduled. 

• Equipment acquisition. 

• Dry dock start/complete. 

• Equipment installation complete. 

• Submittal of invoice to local agency for reimbursement. 

• 1st reporting milestone 6 months after equipment project completion. 

C. Recordkeeping Requirements 

Equipment owners shall retain, at minimum, all documents, invoices, and 

correspondence associated with the application, award, contract, monitoring, 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix E: Harbor Craft E-3 February 2008

enforcement, and reporting requirements at least two years after equipment project 

contact term or three years after final payment, whichever is later. Records shall be 

readily available and accessible to the local agency, ARB, or designee upon request for 

the purposes of ongoing evaluations or auditing. 

D. Reporting Requirements 

Equipment owners shall be responsible for annual reporting to the local agency that 

includes, but is not limited to: 

• Contact information (owner name, company, address, phone). 

• Home port. 

• Vessel type. 

• Vessel identifier, such as US Coast Guard, CA Fish & Game, Call Sign, Maritime 

Mobile Service Identity, or other relevant vessel identifier. 

• Date and location of installation/acquisition of equipment.

• Engine make, model, year, serial number and engine horsepower. 

• Annual engine hours of operation. 

• Percent of operation and distance from shore (0-3, >3-24, >24 nautical miles). 

• Summary of maintenance and inspections conducted. 

• Signed Certification statement that the bond-funded equipment was installed on or 

replaced the vessel for which it was approved and that all information submitted to 

the local agency is true and accurate. 

• Other information as requested by the local agency. 

E. Ongoing Evaluations and Audits 

Equipment owners shall agree to ongoing equipment project evaluations and equipment 

project audits by the local agency, ARB, or authorized designees. ARB and local 

agency audit requirements and provisions are found in Chapter II.E.5. 

F. Application Information 

Equipment owners shall provide the following information and documentation in addition 

to the requirements described in Chapter IV and other information ARB or local 

agencies may request on the equipment project applications. 

1. General contact information 

This section applies to all equipment project options listed below. 

• Organization/agency/company name 

• Mailing address 

• Primary contact name and phone number 

• Person with equipment contract signing authority (Owner) 

• Proof of identity of equipment owner 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix E: Harbor Craft E-4 February 2008

• Small business information 

o Number of harbor craft 

o Number of employees 

o Annual gross income 

2. Options (1) and (2): repowers 

a) Current equipment and activity information 

• Harbor craft data 

o Harbor craft name, home port 

o Harbor craft type (tug, tow, commercial fishing, etc.) 

o Vessel model year 

o Engine data 

 Number of propulsion engines 

 Make, model, engine year, number of cylinders, and serial numbers for 

each 

 Engine family 

 Rated brake horsepower/total engine displacement 

 Fuel type 

• Harbor craft documentation 

o USCG documentation number, if applicable 

o CA Fish & Game license number, if applicable 

o IMO number, if applicable 

• Vocation and activity data for the past 2 years 

o Vocation(s) 

o Percent operation within 24 nautical miles of the California coast 

o Identify the trade corridors in which the equipment is routinely operated 

o Estimated average number of propulsion engine operating hours within 24 

nautical miles of the California coast 

o Annual hours of operation 

• Vocation and activity documentation for the past 2 years 

o Documentation of percent operation within 24 nautical miles of the California 

coast may be required 

b) Proposed equipment project information 

• New harbor craft engine repower information 

o Number of propulsion engines 

o Make, model year, number of cylinders by engine 

o Engine horsepower and fuel type by engine 

• Documentation of all engine modifications planned as part of the repower project, 

including description of upgrades to such things as exhaust systems, electronics, 

etc. 

• Itemized cost information for eligible expenses (verifiable quote) 

• Predicted vocation and activity data with new equipment 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix E: Harbor Craft E-5 February 2008

o Vocation 

o Estimated percent operation within 24 nautical miles of the California coast 

o Estimated average number of propulsion engine operating hours within 24 

nautical miles of the California coast 

o Annual hours of operation 

• Equipment project funding demonstration 

o Total project cost 

o Program dollars requested, including option for pro-rated alternative 

o Source and amounts of other funding (private, local, other State, federal) 

o Request for a direct payment to vendor (if applicable) 

o Documentation of match funding availability

3. Options (1) and (2): replacements 

a) Current equipment and activity information 

• Harbor craft data 

o Harbor craft name, home port 

o Harbor craft type (tug, tow, commercial fishing, etc.) 

o Vessel model year 

o Engine data 

 Number of propulsion engines 

 Make, model, engine year, number of cylinders, and serial numbers for 

each 

 Engine family 

 Rated brake horsepower/total engine displacement 

 Fuel type 

• Harbor craft documentation 

o USCG documentation number, if applicable 

o CA Fish & Game license number, if applicable 

o IMO number, if applicable 

• Vocation and activity data for the past 2 years 

o Vocation(s) 

o Percent operation within 24 nautical miles of the California coast 

o Identify the trade corridors in which the equipment is routinely operated 

o Estimated average number of propulsion engine operating hours within 24 

nautical miles of the California coast 

o Annual hours of operation 

• Vocation and activity documentation for the past 2 years 

o Documentation of percent operation within 24 nautical miles of the California 

coast may be required 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix E: Harbor Craft E-6 February 2008

b) Proposed equipment project information 

• New harbor craft information 

o Vessel type 

o Propulsion engine data 

 Number of engines 

 Make, model year, number of cylinders by engine 

 Engine horsepower and fuel type by engine 

• Documentation of all engine modifications planned as part of the repower project, 

including description of upgrades to such things as exhaust systems, electronics, 

etc. 

• Itemized cost information for eligible expenses (verifiable quote) 

• Predicted vocation and activity data with new equipment 

o Vocation 

o Estimated percent operation within 24 nautical miles of the California coast 

o Estimated average number of propulsion engine operating hours within 24 

nautical miles of the California coast 

o Annual hours of operation 

• Equipment project funding demonstration 

o Total project cost 

o Program dollars requested, including option for pro-rated alternative 

o Source and amounts of other funding (private, local, other State, federal) 

o Request for a direct payment to vendor (if applicable) 

o Documentation of match funding availability 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix F: Cargo Equipment F-1 February 2008

APPENDIX F Cargo Handling Equipment 

A. Equipment Project Specifications 

Cargo-Handling Equipment 

Eligible 

Equipment 

Existing diesel-powered rubber-tired gantry crane with a Tier 4 engine or Level 3 verified 

diesel emission control device operating at a seaport or intermodal rail yard in a trade 

corridor. To meet this eligibility requirement, equipment owners may propose to upgrade 

existing cranes concurrent with the installation of a Program-funded energy storage 

system. No Program funds shall be used to upgrade existing cranes to meet the 

eligibility requirements under this Program. 

Option (1) 

Energy 

Storage 

System 

Requirements 

Pro-rated 

Alternative 

The lower of 50% of the total project cost or $160,000 per crane for purchase and retrofit 

of an energy storage system that ARB has verified to Level 1 (25 percent PM control) or 

higher. 

Equipment owner shall: 

• Commit to 15 years of 100% California operation in port or intermodal rail yard 

service in trade corridors. 

• Agree to accept an on-board electronic monitoring unit at any time during the 

contract term. 

• Agree to equipment inspections. 

• Comply with record-keeping, reporting, and audit requirements. 

• Sign a legally binding contract with the local agency including project milestone and 

completion deadlines. 

• Properly maintain upgraded equipment in good operating condition and according to 

manufacturer’s recommendations. 

• Demonstrate proof of equipment warranty and comprehensive insurance on 

upgraded equipment. 

• Comply with all local permitting requirements. 

• Not use the energy storage system to comply with ARB’s rule for diesel cargo 

handling equipment. 

• Certify that there are no outstanding ARB equipment violations associated with the 

equipment project application. 

• Demonstrate proof that the existing crane was upgraded to meet Program eligibility 

requirements if the improvements were done concurrent with the installation of a 

Program-funded energy storage system. 

Equipment owners may opt for a pro-rated alternative consisting of duplicate 

requirements, except that the Program will pay the lower of 25% or $80,000 for a 10 year 

commitment of 100% California-only operation in port or intermodal rail yard service in 

trade corridors. 

Project Cost 

Assumptions 

• Total cost of energy storage unit is ~$160,000-$320,000 per crane. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix F: Cargo Equipment F-2 February 2008

B. Major Milestones for Project Completion 

• Equipment order. 

• Equipment acquisition/installation. 

• Submittal of invoice to local agency for reimbursement. 

• 1st reporting milestone 6 months after equipment project completion. 

C. Recordkeeping Requirements 

Equipment owners shall retain, at minimum, all documents, invoices, and 

correspondence associated with the application, award, contract, monitoring, 

enforcement, and reporting requirements at least two years after equipment project 

contact term or three years after final payment, whichever is later. Records shall be 

readily available and accessible to the local agency, ARB, or designee upon request for 

the purposes of ongoing evaluations or auditing. 

D. Reporting Requirements 

Equipment owners shall be responsible for annual reporting to the local agency that 

includes, but is not limited to: 

• Contact information (owner name, company, address, phone). 

• Date and location of installation of equipment.

• Equipment type and name of home port or rail yard.

• Engine make, model, year, serial number and engine horsepower. 

• Annual engine hours of operation. 

• Annual fuel usage. 

• Summary of maintenance and inspections conducted. 

• Signed Certification statement that the bond-funded technology was installed on the 

equipment for which it was approved and that all information submitted to the local 

agency is true and accurate. 

• Other information as requested by the local agency.

E. Ongoing Evaluations and Audits 

Equipment owners shall agree to ongoing equipment project evaluations and equipment 

project audits by the local agency, ARB, or authorized designees. ARB and local 

agency audit requirements and provisions are found in Chapter II.E.5.

F. Application Information 

Equipment owners shall provide the following information and documentation in addition 

to the requirements described in Chapter IV and other information ARB or local 

agencies may request on the equipment project applications. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix F: Cargo Equipment F-3 February 2008

1. General contact information 

This section applies to all equipment project options listed below. 

• Organization/agency/company name 

• Mailing address 

• Primary contact name and phone number 

• Person with equipment contract signing authority (Owner) 

• Proof of identity of equipment owner 

• Small business information 

o Fleet size 

o Number of employees 

o Annual gross income 

2. Option (1): energy storage systems 

a) Current equipment and activity information 

• Rubber tired gantry crane data 

o Name and address of location where RTG crane operates 

o Equipment make, model, model year 

o RTG crane identification number or VIN 

o Engine data (per engine) 

 Engine make, model, engine year 

 Serial number 

 Horsepower and fuel type 

o Existing energy storage system specifications (if applicable) 

o Proposed RTG crane upgrades to meet Program eligibility (if applicable) 

• Activity data for the past 2 years 

o Annual hours of operation 

o Identify the trade corridors in which the equipment is routinely operated 

b) Proposed equipment project information 

• Energy storage system data 

o Equipment make, model, model year 

o Equipment power rating and specifications for power assist system 

• Itemized cost information for eligible expenses (verifiable quote) 

• Predicted activity data with new equipment 

o Estimated annual hours of operation 

• Equipment project funding demonstration 

o Total project cost 

o Program dollars requested, including option for pro-rated alternative 

o Funding sources and amounts of other funding (private, local, other State, 

federal) 

o Documentation of match funding availability 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix F: Cargo Equipment F-4 February 2008

[this page intentionally blank]
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix G: Truck Stop Electrification G-1 February 2008

APPENDIX G Truck Stop/Distribution Center Electrification 

A. Background 

Emissions from the trucks themselves, together with their auxiliary power units for cabin 

comfort and transport refrigeration units that chill perishable loads, impact nearby 

communities. ARB already has several regulations in place that are substantially 

reducing emissions from heavy-duty trucks, truck idling, transport refrigeration units, 

and auxiliary power units over the next few years. 

• On July 22, 2004, ARB adopted a rule limiting unnecessary diesel truck idling to 

5 minutes, beginning in February 2005. On October 20, 2005, ARB amended the 

rule so sleeper berth equipped trucks must comply with the 5-minute idling rule, 

beginning in January 2008. In addition, auxiliary power systems and fuel fired 

heaters on 2007 and newer trucks are subject to more stringent emission 

performance standards. 

• On February 26, 2004, ARB adopted a rule for diesel-fueled Transport Refrigeration 

Units (TRU) and TRU generator sets, and facilities where TRUs operate. This rule 

requires these sources to reduce diesel PM emissions to meet idling emission 

performance standards, beginning in January 2009. 

ARB is also developing a comprehensive rule to accelerate the cleanup and 

replacement of commercial diesel trucks operating in California – this rule is scheduled 

for Board consideration in Fall 2008. Current proposals call for diesel PM filters by the 

end of 2009, upgrades to a model year 2007 or newer truck by the end of 2013, and 

subsequent upgrades to a model year 2010 or newer truck. 

B. Analysis 

To assess the potential benefits, ARB staff looked at internal analyses being done to 

support a health risk assessment for typical distribution centers of various sizes. To 

evaluate the optimum scenario, we considered a large distribution center where trucks 

and TRUs are operating. TRUs could account for over 80 percent of the diesel PM 

emissions at the facility, since trucks are subject to the 5-minute idling rule, and the 

TRUs may operate an average of 3 hours while loading/unloading at the dock. The 

emission reductions per dollar invested in electric infrastructure to replace some of 

these operations would diminish rapidly over time. 

Large Distribution Center Emissions with Adopted ARB Rules 

Large distribution center with trucks and transport refrigeration units (TRUs) 

 Diesel PM 

Emissions 

Expected diesel PM reductions from adopted ARB rules 

(cumulative from 2006 levels)

Source/Year 2006 2010 2015 2020 

Trucks <1 lb/day 45% 73% 84% 

TRUs 9 lbs/day 30% 75% >90% 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix G: Truck Stop Electrification G-2 February 2008

Despite the diminishing returns, ARB staff acknowledges that electrification of a truck 

stop, intermodal facility, distribution center, or other place where trucks congregate may 

be useful to reduce emissions in the near term at high use facilities with neighborhoods 

nearby. This Appendix provides a general methodology and standard that an 

equipment owner shall meet to apply for bond funding. 

The equipment owner shall work with the local air district to estimate the baseline 

emissions from existing operations, after accounting for the benefits of all adopted 

regulations. The equipment owner shall provide the proposed operating statistics for 

the project and calculate the resulting change in emissions over a ten year period. 

Based on the bond funding requested, if the weighted reductions per State dollar 

invested is better than the average for truck replacement projects, the electrification 

project shall be eligible to compete against other truck proposals for funding. 

C. Equipment Project Specifications 

Truck Stop/Distribution Center Electrification 

Eligible Equipment Truck stops, intermodal facilities, distribution centers, and other places where 

Class 8 heavy diesel trucks (over 33,000 lbs) congregate in a trade corridor. 

Option (1) 

Electrification 

Infrastructure 

Requirements 

Landside electrification infrastructure to reduce diesel engine idling and use of 

diesel-fueled internal combustion auxiliary power systems may be funded at the 

lower of 50% of eligible costs or a level commensurate with the weighted 

reductions per State dollar invested for truck replacement projects. Eligible costs 

include purchase and installation of electrical infrastructure to: enable heating, 

cooling, and the use of cab power for parked trucks at truck stops; and enable 

the use of power for transport refrigeration units and auxiliary power systems at 

distribution centers, intermodal facilities, and other places where trucks 

congregate. Reimbursement for the eligible costs shall be based on 

demonstrated use over the first year of operation. 

Equipment owner shall: 

• Commit to 10 years of operation. 

• Agree to equipment inspections. 

• Comply with record-keeping, reporting, and audit requirements. 

• Sign a legally binding contract with the local agency including project 

milestone and completion deadlines. 

• Properly maintain upgraded equipment in good operating condition and 

according to manufacturer’s recommendations. 

• Demonstrate proof of equipment warranty. 

• Comply with all local permitting requirements. 

Project Cost 

Assumptions 

• Total cost for distribution centers is $1,500-$7,000/plug at dock; $2,500-

$9,000/plug in parking areas; $500-$2,000/adapter for trailers and TRUs. 

• Total cost for truck stops is $6,000-$18,000/parking space; $3,000/truck 

modification. 

Excluded Funding 

Components 

On-board auxiliary power units and other equipment installed on trucks are not 

eligible for funding. Transport refrigeration units are not eligible for funding. 

Electricity costs are not reimbursable. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix G: Truck Stop Electrification G-3 February 2008

D. Major Milestones for Project Completion 

The equipment project schedule shall include, but is not limited to, the following 

milestones: 

• Contract execution between local agency and equipment owner 

• Facility pre-inspection 

• Completion and certification of any required CEQA documents 

• Bid solicitation, evaluation and award, and construction contract 

• Acquisition of any local permits, or other requirements 

• Electrification system design, unit acquisition and delivery 

• 50% project completion 

• 80% project completion 

• 100% project completion 

• Post-inspection by the local agency 

• 1st year of operation and collection of use data 

• Reporting to local agency of electrical use by trucks during 1st year of operation 

• Reimbursement and project close out 

• Next reporting milestone 

E. Recordkeeping Requirements 

Equipment owners shall retain, at minimum, all documents, invoices, and 

correspondence associated with the application, award, contract, monitoring, 

enforcement, and reporting requirements at least two years after equipment project 

contact term or three years after final payment, whichever is later. Records shall be 

readily available and accessible to the local agency, ARB, or designee upon request for 

the purposes of ongoing evaluations or auditing. 

F. Reporting Requirements 

Equipment owners shall be responsible for annual reporting to the local agency that 

includes, but is not limited to: 

• Contact information (owner name, company, address, phone). 

• Facility location.

• Project completion date.

• Monthly truck and TRU connections to electrical power and electricity usage for each 

month in the reporting year. 

• Summary of maintenance and inspections conducted. 

• Signed Certification statement that the bond-funded project was installed and is 

operating as it was approved in the post-inspection and that all information 

submitted to the local agency is true and accurate.

• Other information as requested by the local agency.
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix G: Truck Stop Electrification G-4 February 2008

G. Ongoing Evaluations and Audits 

Equipment owners shall agree to ongoing equipment project evaluations and equipment 

project audits by the local agency, ARB, or authorized designees. ARB and local 

agency audit requirements and provisions are found in Chapter II.E.5.

H. Application Information 

Equipment owners shall provide the following information and documentation in addition 

to the requirements described in Chapter IV and other information ARB or local 

agencies may request on the equipment project applications. 

1. General contact information 

Equipment project applicant shall identify all parties with the legal authority to sign 

contracts concerning equipment acquisition, land improvements, equipment operation 

and maintenance. The following information shall be provided for each party: 

• Organization/agency/company name 

• Mailing address 

• Primary contact name and phone number 

• Person with equipment contract signing authority (Owner) 

• Proof of identity of equipment owner 

• Small business information 

o Number of employees 

o Annual gross income 

2. Option (1): electrification infrastructure 

a) Current equipment and activity information 

• Location and description of facility where electrification infrastructure is proposed for 

installation 

• Quantification of current annual truck operations and TRU operations at the facility 

• Baseline emissions (without the project) for first 10 years of operation of proposed 

electrical infrastructure (developed with the concurrence of the local air district) – this 

emission estimate shall fully reflect the benefits of all adopted regulations including 

ARB rules for trucks, idling, auxiliary power systems, TRUs, and TRUs with 

generators sets 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix G: Truck Stop Electrification G-5 February 2008

b) Proposed equipment project information 

• Electrification infrastructure information 

o Project description and design, including number and location of electrification 

units to be installed, with individual and total power requirements 

o Equipment vendor(s) 

o Itemized cost information by phase (e.g. design, environmental, construction) 

• Predicted activity data with new equipment 

o Estimated annual truck connections to electric power and average connection 

time 

o Estimated annual TRU connections to electrical power and average 

connection time 

o Expected power usage for trucks and TRUs (separately), each year for the 

first ten years of operation 

• Projected emissions and benefits of the project 

o Emissions with the project over a ten-year period 

o Emission reductions attributable to the project (beyond those required by law 

or regulation) for a ten-year period beginning in the 1st year of operation 

o Demonstration that the weighted emission reductions per State dollar 

invested is equal or better than the average for truck replacement projects 

• Equipment project funding demonstration 

o Total project cost 

o Program dollars requested 

o Funding sources and amounts of other funding (private, local, other State, 

federal) 

o Documentation of match funding availability 

.
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix G: Truck Stop Electrification G-6 February 2008

[this page intentionally blank]
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix H: Early Grants H-1 February 2008

APPENDIX H: Early Grants 

SB 88 makes available no more than $25 million of the FY2007-08 appropriation 

available for the purpose of executing grant agreements directly with ports, railroads, or 

local air districts for eligible projects to achieve the earliest possible heath risk reduction. 

SB 88 requires that ARB allocate funds under this “early grant” provision consistent with 

these Guidelines, and that ARB provide sufficient opportunity for the public to review 

and comment on any projects proposed for funding. 

In order to bring early grant proposals to the Board as quickly as possible, ARB staff 

directly contacted local air districts within the trade corridors to request proposals for 

local agency projects that could be under contract with equipment owners and mostly 

complete by July 31, 2008. ARB staff focused on local air districts due to their 

demonstrated experience and expertise implementing incentive programs through the 

Carl Moyer incentive program. 

To ensure that the early grant project proposals would be consistent with the eligibility 

and equipment project requirements included in the Program Guidelines, ARB staff 

advised the local air districts to use the Staff Draft Concepts for Implementation

document, released September 19, 2007, as the primary basis for equipment project 

requirements under the early grant provision. In early November 2007, ARB staff also 

provided the local air districts with ARB Staff Expectations for Early Grant Proposals

(attached) to further specify the content of the early grant proposals as well as other 

critical information (e.g. per equipment funding levels) pertinent to the air district’s 

development of an early grant proposal. 

On November 20, 2007, ARB staff held a conference call with air districts interested in 

submitting an early grant proposal to clarify questions. In response to comments from 

the air districts regarding the potential for harbor craft projects that could be quickly 

implemented, ARB staff expanded the early grant eligibility requirements to allow harbor 

craft projects at $135/horsepower. 

ARB requested that the proposals include only the information necessary for ARB staff 

to subsequently calculate the proposal benefits using methods, calculations, and 

emission factors consistent with those included in the Guidelines. 

ARB staff received five early grant proposals, posted on the Program website at: 

http://www.arb.ca.gov/gmbond. 

ARB staff’s recommendations for early grant funding include truck projects and one 

grid-based shore power proposal. Most of the truck proposals submitted by the air 

districts are based on actual equipment project applications that the air districts received 

through other incentive programs (like the Carl Moyer program) or direct solicitations 

based on air district staff assumptions about what this Program would require, as 

described in the air district early grant applications. Due to the expedited nature and 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix H: Early Grants H-2 February 2008

intent of the early grant proposals, these applications may be considered for funding 

under this Program. 

In order to maintain consistency between the early grants and the other provisions of 

these Guidelines, the following sections of these Guidelines are applicable to the early 

grant equipment projects: 

• Chapter III 

o Sections B.1 & 4 

o Section C 

o Sections D.1, 3-8, 10, 11-16 

o Sections E-G 

• Chapter IV 

• Appendices A-G 

These sections apply to the early grant projects to ensure that the equipment projects 

considered for funding by each air district are consistent with these Guidelines. In 

particular, although the projects may have been initially identified through a solicitation 

process or identified from an existing incentive program, the air district must still verify 

the equipment projects’ eligibility for Program funds and competitively rank them against 

each other to ensure that the projects with the greatest benefits are funded first. 

In addition, since the air districts did not have the benefit of the detailed provisions in the 

draft Guidelines while identifying equipment projects for their early grant applications, 

the equipment project provisions in Appendices A-G apply except where ARB staff 

provided equipment specifications that differ in the ARB Staff Expectations for Early 

Grant Proposals. In these cases, the air district may choose which equipment 

specifications work best for their early grant projects. 

For example, for grid-based shore power projects under the early grants, ARB staff set 

the Program funding limit at the lower of $2.5 million or 70 percent. In response, the 

Bay Area Air Quality Management District (BAAQMD) proposed a grid-based shore 

power project in Oakland that is requesting $1.4 million per berth for two berths ($2.8 

million total Program funds) for a project with a total cost of $4 million. Although these 

Guidelines currently propose a per berth funding cap in these Guidelines of $2.5 million, 

or 50 percent, whichever is lower, ARB’s early grant recommendation for BAAQMD’s 

grid-based shore power project maintains the funding caps originally offered. 

In another example, for trucks, ARB Staff Expectations for Early Grant Proposals set the 

operational commitment at 5 years for truck retrofits and 10 years for truck 

replacements. These Guidelines specify 4 years and 8 years, respectively. Since the 

current Guidelines are less restrictive, air districts may allow equipment projects to sign 

equipment contracts with commitments set according to these Guidelines instead of the 

original concepts. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix H: Early Grants H-3 February 2008

Goods Movement Emission Reduction Program 

FY2007/2008 

ARB Staff Expectations for Early Grant Proposals 

This document includes ARB staff’s expectations for FY2007/2008 Early Grant 

Proposals submitted by local air district applicants. We have also included specific 

information that supplements and/or modifies the eligibility and operational requirements 

described in the September 19, 2007 concept paper for the early grant proposals. 

In general, ARB staff expects the early grant proposals to follow the staff draft concept 

paper. We have listed several key expectations for emphasis and clarification. 

• The early grant proposals represent a commitment by the applicant to sign a 

grant agreement with ARB if the ARB Board approves the full or partial proposal, 

as submitted. We understand that the applicant may reserve the right to 

withdrawal the proposal should the ARB Board change the conditions or eligibility 

requirements of the early grants. To provide the ARB Board maximum flexibility 

in allocating the full $25 million in early grant dollars, we request that you design 

the proposals to allow pro-rated funding and acknowledge your willingness to 

accept a lower funding amount. 

• Local agency and equipment eligibility requirements remain as stated in the 

September 19, 2007 staff draft concept paper, with the exception of the 

modifications included in this document. 

• Equipment operational requirements remain as stated in the September 19, 2007 

staff draft concept paper, with the exception of the modifications included in this 

document. 

• Pre/post equipment inspections will be conducted to ensure both the old (as 

applicable) and new equipment are eligible and operational. 

• Legally binding contracts will be signed between the implementing local agency 

and equipment owners to ensure program accountability. 

• Implementing local agencies and equipment owners agree to the reporting and 

record keeping requirements of the bond program. 

• Implementing local agencies will monitor bond-funded equipment for compliance 

with contract provisions. 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix H: Early Grants H-4 February 2008

The following outline provides the content requirements for the early grant proposals. 

As indicated, we request that the submittals be no more than 10 pages in length, and 

preferably shorter. We intend to append these proposals to our proposed Guidelines for 

public review and comment prior to Board consideration. 

1. Summary of proposal (1-2 pages) 

o Briefly state the air quality and health concerns addressed 

o Summarize project types, corridor(s), and costs 

o Identify the implementation schedule (with major milestones) 

 What/how much can you accomplish by June 30, 2008?

 Why these accomplishments are achievable 

2. Detailed proposal (5-10 pages) 

o Geographic coverage 

 Identify the targeted trade corridor(s) 

 Does the proposal target equipment upgrades in specific highly 

impacted communities? If so, which ones? 

 Describe marketing/outreach (must include entire corridor) 

o Old Equipment 

 Certify that old equipment eligibility is based on the equipment project 

information tables in the staff draft concept paper, as modified by this 

document 

 Identify the number of pieces of equipment targeted, by sector 

• Describe the basis for proposing this number of equipment for 

expedited implementation under the early grants 

• For trucks, identify the number of retrofits and the number of 

replacements being proposed 

 Operating assumptions for old equipment 

• Trucks (list retrofits and replacements separately) 

 Average age (model year) 

 Average annual VMT 

• Locomotives (only switchers) 

 Average age (years) 

 Control level (uncontrolled, Tier 0, 1) 

 Average annual fuel use 

 Average annual operating hours 

• Shorepower 

 Identify type(s) of cargo vessel (container, bulk, reefer) 

o New Equipment 

 Certify that old equipment eligibility is based on the equipment project 

information tables in the staff draft concept paper, as modified by this 

document 

 Operating assumptions for new equipment 

• Trucks 

 Must be model year 2007 or 2008 truck 

 Average annual VMT (if different from old equip.) 

 Identify fuel type 
Proposition 1B: Goods Movement Emission Reduction Program–Guidelines for Implementation 

Appendix H: Early Grants H-5 February 2008

• Locomotives (switchers only) 

 Identify fuel type 

 ARB staff will use annual operating hours reported for old 

equipment to calculate emission benefits 

• Shore power 

 Ship visits per year using shore power (per berth)

(ARB staff will use operating assumptions to do the calculations consistent with factors/ formulas/ 

methodologies that will be included in the draft program guidelines) 

o Staff resources 

 Describe staff resources available to implement proposal 

o Funding proposals (Note: Please separate by sector. ARB will consider each 

sector as a separate proposal) 

 Total cost 

• Identify truck costs for retrofits and replacements 

 Bond funds requested 

 Matching funds 

• Detail funding source 

 Demonstrate that these funds are available 

 DMV $4 and $2 fees may be used as non-state match 

(since clarified to be $4 fees only) 

 Administration funds requested 

• Must comply with staff concept limits 

o Early grant milestone requirements 

 100% of contracts signed with equipment owners by June 30, 2008 

 Trucks 

• Majority of proposed truck upgrades completed and operational 

by June 30, 2008 

• All of proposed truck upgrades completed and operational by 

December 31, 2008 

 Locomotives 

• All of new locomotives ordered by June 30, 2008 

• All of new locomotives operational by December 31, 2009 

 Shore power 

• All completed and operational by December 31, 2010

o Provide a project schedule that includes interim milestones 

 Outline specific accomplishments by June 30, 2008 

o Implementation 

 Describe how you will secure equipment projects 

 Describe how you will select projects for funding 
Proposition 1B: Goods Movement Emission Reduction Program – Draft Guidelines for Implementation 

Appendix H: Early Grants H-6 February 200

Goods Movement Emission Reduction Program Early Grant Proposals – Updated Requirements (Updates to project options identified in staff concept pa

Category Eligibility Amounts Cont

Leng

Truck retrofits 

- at least 50% of operation of old equipment must take place within the four trade corridors 

$5,000 per dpf 5 yea

Truck replacement 

- at least 50% of operation of old equipment must take place within the four trade corridors - old truck must have annual VMT of 10,000 miles or greater 

$50,000 per truck 10 ye

Shore power 

- grid-based power only $2.5M per berth (grid-based), or 

70% of the shoreside cost to bring power to berth, whichever is less 

20 ye

Locomotives 

- switchers only - at least 50% of operation of old equipment must take place within the four trade corridors - uncontrolled locomotives eligible with 35,000 gal/yr minimum - 

$500,000/ switcher (no DPF required) 20 ye

Harbor Craft Not eligible for early grants Note: Early grants must maintain requirement for 100% California operation for new equipment (except locomotive maintenance)