Final Statement of Reasons for Rulemaking 

Including Summary of Comments and Agency Responses 

PUBLIC HEARING TO CONSIDER THE ADOPTION OF PROPOSED

MODIFICATIONS TO THE REGULATION FOR IN-USE OFF-ROAD 

DIESEL-FUELED FLEETS 

Public Hearing Date: January 22, 2009

Agenda Item No.: 09-1-4

-iTABLE OF CONTENTS 

I GENERAL.............................................................................................................1

II SUMMARY OF COMMENTS AND AGENCY RESPONSES................................4

1. Requirements for Fleet Size Changes .............................................................7

2. Tier 1 Delay .....................................................................................................8

3. Monitor Emissions Losses from Amendments.................................................9

4. Double Credit Not Enough to Encourage Retrofitting ....................................10

5. Modify the Regulation Due To the Current Economic Downturn....................11

6. Modify the Regulation Due to the Lack of Technology...................................26

7. VDECS Do Not Work and Are Not Reliable...................................................30

8. VDECS Are Not Appropriate for GSE ............................................................32

9. VDECS Safety Issues....................................................................................33

10.Cost of VDECS ..............................................................................................35

11.Cannot Afford the Regulation.........................................................................37

12.Re-do the Economic Analysis ........................................................................39

13.Regulation Will Affect the Economy...............................................................39

14.Cannot Pass on Costs ...................................................................................40

15.Fleets are Downsizing....................................................................................41

16.Tier 4 Engines Are Not Available ...................................................................41

17.Analyze the Impacts of Multiple Regulations .................................................42

18.Alternatives to the Regulation........................................................................43

19.Labeling Amendment.....................................................................................44

20.Captive Attainment Area Fleet Extension ......................................................47
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-1- 

State of California 

AIR RESOURCES BOARD 

Final Statement of Reasons for Rulemaking 

Including Summary of Comments and Agency Responses 

PUBLIC HEARING TO CONSIDER THE ADOPTION OF PROPOSED

MODIFICATIONS TO THE REGULATION FOR IN-USE OFF-ROAD DIESEL 

FUELED FLEETS 

Public Hearing Date: January 22, 2009 

Agenda Item No.: 09-1-4 

I GENERAL 

In this rulemaking, the Air Resources Board (ARB, Board) approved 

modifications to the regulation for In-Use Off-Road Diesel Fueled Fleets (off-road 

regulation), set forth in California Code of Regulations (Cal. Code Regs.), title 13, 

sections 2449 through 2449.3. These modifications include amending: 

• Section 2449.2(a)(2)(A)2.a.i to extend the deadline for receiving double 

credits for early installation of particulate matter (PM) retrofits by 10 

months from March 1, 2009 to January 1, 2010; 

• Section 2449(d)(4)(A) to modify the changing-fleet-size requirements to 

not penalize fleets that change from small fleets to larger fleets, and then 

subsequently become a small fleet again; 

• Section 2449(h)(8) to clarify that all sellers, and not just dealers, of offroad vehicles must maintain records of the disclosure of regulation 

applicability; 

• Section 2449.1(a)(2)(A)5. to clarify that the provision for delay of Tier 1 

turnover exempts Tier 1 vehicles from turnover only until the March 1, 

2012, compliance deadline; and 

• Section 2449(g)(1)(D) to clarify the reporting requirements for verified 

diesel emission control strategies (VDECS). 

On December 4, 2008, ARB issued a notice for a public hearing to consider the 

modifications to the off-road regulation at the Board’s January 22-23, 2009 

hearing. A “Staff Report: Initial Statement of Reasons” (Staff Report), describing 

the rationale for the modifications, was also made available for public review and 

comment starting December 4, 2008. The text of the modifications, which 

includes amendments to sections 2449, 2449.1, 2449.2, and 2449.3 in title 13, 

CCR, was included as Appendix A, to the Staff Report. The Notice and Staff 

Report are incorporated by reference herein. These documents were also 

posted on the ARB’s internet site for the rulemaking on December 4, 2008 at: 

http://www.arb.ca.gov/regact/2009/ordiesl09/ordiesl09.htm (“ARB’s internet site”). 
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On January 22, 2009, the Board conducted a public hearing to consider the 

staff’s proposal for adoption of the modifications to the off-road regulation. 

Written and oral comments were received at the hearing, and the Board adopted 

Resolution 09-3, approving the proposed modifications to the off-road regulation 

with no changes. 

This Final Statement of Reasons (FSOR) for this rulemaking summarizes written 

and oral comments the Board received on the proposed modifications to the offroad regulation during the formal rulemaking process and the ARB’s responses 

to those comments. 

Documents Incorporated by Reference. There are no documents incorporated 

by reference in title 13, Cal. Code Regs., section 2449, 2449.1, 2449.2, or 

2449.3. 

Fiscal Impacts. The fiscal impacts of the modifications to the off-road regulation 

are discussed below. 

Costs to State Government and Local Agencies 

Pursuant to Government Code sections 11346.5(a)(5) and 11346.5(a)(6), the 

Executive Officer has prepared an estimate in accordance with instructions 

adopted by the Department of Finance, and determined that the regulatory action 

would not create overall costs or savings to any state agency or in federal 

funding to the state, costs or mandate to any local agency or school district 

whether or not reimbursable by the state pursuant to part 7 (commencing with 

section 17500), division 4, title 2 of the Government Code, or other 

nondiscretionary cost or savings to state or local agencies. 

The modification to extend early double credit will provide fleets additional time to 

install early VDECS, and thereby the opportunity to accumulate additional credits 

and spread out their compliance costs over several years, without increasing or 

decreasing the total cost of the regulation. The ability to spread out initial 

compliance costs will benefit the state, federal, and larger municipal fleets whose 

first compliance date is March 1, 2010, more than local municipalities that are 

small or medium fleets, because their earlier first compliance dates mean their 

need for early credit is more urgent. 

Effect on Private Persons and Businesses 

Pursuant to Government Code section 11346.5(a)(9), ARB has evaluated the 

potential economic impacts on representative private persons or businesses and 

the Executive Officer has determined that a representative private person and 

business would incur minimal, if any, cost impacts because of the modifications 

to the off-road regulation. The only amendment that would potentially result in 

additional costs is including all sellers in the disclosure retention provision. 
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However, the cost of retaining such records is expected to be negligible. In 

addition, it was staff’s original intent to include all sellers in the disclosure 

requirements, and thus any additional cost of maintaining these records was 

accounted for in the statewide cost analysis for the in-use off-road regulation 

when it was originally adopted. 

As discussed previously, the modification to extend early double credit is not 

expected to result in any additional costs or savings on businesses overall. 

Instead, it will provide a benefit to them by enabling fleets additional time to 

install early VDECS, and thereby accumulate credit that will enable them to 

spread out their compliance costs in later years. 

The Executive Officer has also determined, pursuant to CCR, title 1, section 4, 

that the regulatory action may affect small businesses. 

Effect on State Economy 

Pursuant to Government Code section 11346.5(a)(8), the Executive Officer has 

made an initial determination that the proposed regulatory action would not have 

a significant statewide adverse economic impact directly affecting businesses, 

including the ability of California businesses to compete with businesses in other 

states, or on representative private persons. 

In accordance with Government Code sections 11346.5(a)(10) and 11346.3(b), 

the Executive Officer has further determined that the regulatory action would not 

affect the creation or elimination of jobs within the State of California, the creation 

of new businesses or elimination of existing businesses within the State of 

California, or the expansion of businesses currently doing business within the 

State of California. A detailed assessment of the economic impacts of the 

regulatory action and its effect on California businesses can be found in the 

ISOR. 

Consideration of Alternatives. The modifications to the off-road regulation 

were the subject of discussions involving staff and the affected owners, 

operators, and sellers of in-use off-road diesel vehicles in California. A 

discussion of alternatives to the proposed modifications to the off-road regulation 

is found in Chapter VII of the Staff Report. For the reasons set forth in the Staff 

Report, staff’s comments and responses at the hearings, and this FSOR, the 

Board has determined that none of the alternatives considered by the agency 

would be more effective in carrying out the purpose for which the modifications to 

the off-road regulation were proposed or would be as effective and less 

burdensome to affected private persons than the action taken by the Board. 
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II SUMMARY OF COMMENTS AND AGENCY RESPONSES 

The Board received numerous written and oral comments in the formal 45-day 

rulemaking comment period leading up to the January 2009 Board meeting, 

beginning with the notice publication December 4, 2008, and ending with the 

closing of the record on January 22, 2009. Comments that were not pertinent to 

modifying the off-road regulation or to the proposed modifications were not 

included in this document. Table II-1 below lists commenters that submitted 

timely, pertinent comments, and identifies the date and form of their comments. 

Following the table is a list of those comments that were wholly in support of the 

modifications to the off-road regulation. 

Following those lists is a summary of each objection or recommendation 

regarding the proposed action, together with an agency response providing an 

explanation of how the proposed action has been changed to accommodate the 

objection or recommendation or the reasons for making no change. The 

comments have been grouped by topic whenever possible. Comments not 

involving objections or recommendations specifically directed towards the offroad regulation, the current rulemaking, or to the procedures followed by the ARB 

in this rulemaking are not summarized or responded to. Additionally, any other 

referenced documents are not summarized below. 

Comments during the 45-day Comment Period Up to and at the Board Hearing

Table II-1 below lists the comments pertinent to the rulemaking that were 

received during the 45-day comment period up to and at the Board Hearing and 

the Reference Code assigned to each. 

Table II-1 Comments From Up To and At the Board Hearing 

Reference 

Code Commenter Affiliation Date Received 

AGC1 Corash, 

Michelle 

Associated General 

Contractors 

January 22, 

2009 

AGC2 Steel, Michael Associated General 

Contractors 

January 22, 

2009 

ALAC Holmes-Gen, 

Bonnie 

American Lung 

Association of California 

January 22, 

2009 

ATA1 Pohle, 

Timothy 

Air Transport 

Association 

January 21, 

2009 

ATA2 Pohle, Tim Air Transport 

Association 

January 22, 

2009 

BAYCITIES Michaelson, 

Rod 

Bay Cities Paving and 

Grading 

January 22, 

2009 

CAMARILLO1 Porcher, Dave Camarillo Engineering 

Inc. 

January 5, 

2009 
-5- 

Reference 

Code Commenter Affiliation Date Received 

CAMARILLO2 Porcher, Dave Camarillo Engineering January 22, 

2009 

CIAQC1 Lewis, 

Michael 

Construction Industry Air 

Quality Coal 

January 21, 

2009 

CIAQC2 Lewis, Mike Construction Industry Air 

Quality Coalition 

January 22, 

2009 

CIAQC3 Miller, Clayton Construction Industry Air 

Quality Coalition 

January 22, 

2009 

CLEAIRE1 Edgar, 

Bradley 

Cleaire Advanced 

Emission Controls 

January 8, 

2009 

CLEAIRE2 Swenson, 

Tom 

Cleaire Advanced 

Emission Controls 

January 22, 

2009 

COLLINS Collins, Lesli Collins, Lesli January 20, 

2009 

CRAM Cram, Rob Cram, Rob January 21, 

2009 

DDGE Defty, 

Spencer 

Diamond D General 

Engineering 

January 21, 

2009 

DOWNS Ambrose, 

Brant 

Downs Equipment 

Rental 

January 22, 

2009 

ECCO Rohman, Gary ECCO Equipment 

Corporation 

January 22, 

2009 

GCI1 Pfeifer, Nick Granite Construction 

Inc. 

January 20, 

2009 

GCI2 Pfeifer, Nick Granite Construction 

Inc. 

January 22, 

2009 

KEY Key, Michael Key, Michael December 5, 

2008 

KNAPP Knapp, Greg Knapp, Greg January 27, 

2009 

LEWIS Lewis, 

Michael Lewis, Michael January 27, 2009 

MCCLELLAND McClelland, 

John McClelland, John January 19, 2009 

MCDONALD1 McDonald, 

Steve McDonald, Steve December 10, 2008 

MCDONALD2 McDonald, 

Steve McDonald, Steve December 17, 2008 

MECA1 Brezny, Rasto 

Manufacturers of 

Emission Controls 

Association 

January 21, 

2009 

MECA2 Kubsch, Joe 

Manufacturers 

Emissions Control 

Association 

January 22, 

2009 
-6- 

Reference 

Code Commenter Affiliation Date Received 

NETT Mannan, MA Nett Technologies January 21, 

2009 

NRDC Bailey, Diane Natural Resources 

Defense Council 

January 22, 

2009 

NWS Thomas, 

James Neighbors Well Services January 22, 2009 

QUINN Shepherd, 

Bob Quinn Group January 19, 2009 

RCRC1 Pitto, Mary Regional Council of 

Rural Counties 

January 27, 

2009 

RCRC2 Pitto, Mary Regional Council of 

Rural Counties 

January 22, 

2009 

REED Reed MD, 

John Reed MD, John December 29, 2008 

SCCA1 Davis, Bill Southern California 

Contractors Association 

January 27, 

2009 

SCCA2 Davis, Bill Southern California 

Contractors Association 

January 22, 

2009 

SIERRA Bray, Andrew Sierra at Tahoe Ski 

Resort 

January 22, 

2009 

SYBLON Hunt, Jim Syblon Reid January 22, 

2009 

UCS1 Anair, Don Union of Concerned 

Scientists 

January 8, 

2009 

UCS2 Anair, Don Union of Concerned 

Scientists 

January 22, 

2009 

VCMI Dietl, Bruno Vulcan Construction & 

Maintenance, Inc. 

January 21, 

2009 

WIPF Wipf, Ernest Wipf, Ernest December 11, 

2008 

Of the comments above in Table II-1, the following Reference Codes pertain to 

comments that were wholly in support of the modifications to the off-road 

regulation. If a comment was partially in support of the modifications to the offroad regulation but also suggested changes to the proposed modifications, it is 

not included below, but is responded to in the agency responses later in this 

document. 
-7- 

Reference 

Code 

ALAC 

CAMARILLO1 

CAMARILLO2 

CLEAIRE1 

CLEAIRE2 

CRAM 

MECA1 

MECA2 

NETT 

NRDC 

SIERRA 

UCS2 

Sections 1. through 4. below respond to those comments directly related to the 

modifications to the off-road regulation approved by the Board in January 2009. 

In addition to these comments, some comments received did not directly pertain 

to the modifications to the off-road regulation, but were requests for additional 

modifications because of the current economic downturn. Although these 

comments do not pertain directly to the modifications to the off-road regulation, 

because they are peripherally relevant to the rulemaking, staff has responded to 

them as well below. Finally, staff also received several comments pertaining to 

the costs, technical feasibility or other provisions of the regulation. Although 

many of these comments were responded to in the FSOR for the original 

regulation and do not pertain directly to the modifications to the off-road 

regulation, staff has restated some of these responses below for completeness 

and because they are peripherally relevant to the regulatory action covered by 

this FSOR. 

1. Requirements for Fleet Size Changes 

Comment: The proposed requirement for fleet size changes is a step in the right 

direction. However, this change to the regulation should be afforded to the large 

fleets also. The large fleets will feel the negative effects of these regulations 

years before the medium and small fleets. These large fleets are also the largest 

contributors to the state’s income through taxes and allowing them the ability to 

move from medium to large as their dormant fleets become active again will 

further assist them in this economic downturn and will help to support that tax 

base. (MCDONALD1)(MCDONALD2) 

Agency Response: We (ARB staff) believe that the commenter above 

misunderstood the proposed revisions for the changing fleet size requirements. 

Under section 2449(d)(4)(A) of the regulation, a medium fleet increases in size 

and becomes a large fleet, that fleet has two years to phase into the larger fleet 
-8- 

requirements (which in some years are stricter than the medium fleet 

requirements). The same is true for a small fleet that increases in size and 

becomes a medium or large fleet. This is intended to give fleets time to adjust to 

and comply with the stricter requirements of the larger fleet size category. 

Additionally, if a fleet ever shrinks into a smaller fleet size category (for example, 

from large to medium, or from medium to small), that fleet is allowed to start 

complying immediately with the smaller fleet size requirements. Overall, the 

changing fleet size provisions allow a growing fleet to have extra time to comply 

with the new, stricter requirements, while at the same time allowing fleets that 

shrink to take advantage of the smaller fleet’s less stringent requirements 

immediately. 

Originally, this provision also stated that if a small fleet grew into a medium or 

large fleet, and then subsequently reverted back to a small fleet, that fleet was 

required to keep meeting the medium or large fleet requirements for two years 

after shrinking back into the small fleet size category. As stated in the Staff 

Report for these amendments, this provision was initially developed to prevent 

fleets from taking advantage of a potential loophole under the regulation by 

deliberately growing and then shrinking a fleet’s size and being subject only to 

the small fleet requirements. However, after further review of this requirement 

staff has determined that the possible complexity of this provision in practice, 

especially in situations where a fleet may frequently change in size over time, far 

outweighs the potential for fleets to abuse the changing fleet size provisions. 

The commenter appears to want to relax requirements for large fleets that 

change fleet size; however, as described above, the current changing fleet size 

provisions already provides for this. This aspect of the provision was not affected 

by the amendments adopted in January 2009. Therefore, staff believes that the 

commenter’s concern is already addressed in the current provisions for changing 

fleet sizes. 

2. Tier 1 Delay 

Comment: We do not support the changes to the Tier 1 delay. Whenever you 

repower a Tier 0 to a Tier 1, you realize a 58 percent reduction in PM and a 55 

percent reduction in NOx. 

Those Tiers 1s have been generating those reductions for anywhere between 

eight and 12 years. During the time of the development of the regulation, this 

was a small incentive for the Tier 1 fleets and we believe it should remain the 

same. (NWS) 

Agency Response: As stated in the Staff Report for these amendments, the 

intent of the Tier 1 delay provision in section 2449.1(a)(2)(A)5. of the regulation 

as approved by the Board in 2007 was always to exempt Tier 1 vehicles from the 

turnover requirements of the regulation until a fleet was required to meet their 
-9- 

March 1, 2013, compliance deadline. That is, the original regulation language 

was intended to require fleets to begin turning over their Tier 1 vehicles between 

March 1, 2012 and March 1, 2013, to meet the March 1, 2013, compliance 

requirements. The intent of these amendments was to make that intent clear, 

rather than to change any requirements. A misunderstanding of this provision is 

most likely why the commenter above believed this provision was changing. The 

fact that commenter NWS misunderstood the original language supports the 

need for clarifying the language, as the amendments to section 2449.1(a)(2)(A)5. 

do. 

3. Monitor Emissions Losses from Amendments 

Comment: While we support the proposed amendments, we urge staff and the 

Board to build in requirements for monitoring their effects on emissions and allow 

for additional modifications if needed to preserve the regulation’s emission 

reduction benefits. Furthermore we strongly oppose any rollbacks of compliance 

deadlines. 

Specifically, we request that CARB consider the following: 

• Double Credit Extension: Without data on the number of fleets that have 

taken advantage of the early compliance provision so far, it is even harder 

to predict how many fleets would take advantage of the proposed 

extension going forward. This creates great uncertainty on how the 

proposed extension would impact early PM clean up and how early 

actions would influence future emissions reductions. CARB should 

monitor how this provision is affecting emission reductions and adjust the 

rule to reduce available credits if staff discovers that emissions goals are 

falling short. 

• Fleet Size Modifications: CARB should monitor this proposed modification 

to ensure that in practice, fleets do not exploit this provision. Emissions 

reductions could be lost. (UCS1) 

Agency Response: We agree that the effects of these amendments should be 

monitored, and will be doing so through the regulatory implementation process. 

In addition, if it appears that these amendments are causing a shortfall in 

emissions reductions expected from this regulation, staff will report this 

information during one of the future scheduled updates to the Board. 

We would also like to clarify that these amendments to the regulation do not 

lessen the overall requirements of the regulation. 
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4. Double Credit Not Enough to Encourage Retrofitting 

 Comment: Allowing the extension of the double credit for early PM retrofits by 

10 months will provide the additional time needed for device manufacturers to 

sort out the additional requirements put on them by the ARB during the ever 

changing verification process. However, it will not make cash available for those 

employers required to purchase and install those retrofit devices. Unlike our 

State and Federal Governments, employers usually don’t spend cash that they 

don’t have or foresee as income and therefore the purchase of these devices will 

be delayed until such a time as the work load will justify and pay for their 

purchase. Also, on pages 14 and 19 of the Staff Report, I believe that staff has 

once again overstated their VDECS estimates. The burden of installing VDECS 

to meet the staff projection of 30 percent by 2011 will fall largely upon the 

shoulder of the large fleets to the tune of approximately 59,500 units, as medium 

fleets first compliance is 2013 and small in 2015, and I would disagree that 

medium and small fleets will find the double credit to be a large enough benefit to 

retrofit early. Particularly when cash flow is low. (MCDONALD1)(MCDONALD2) 

Comment: We appreciate the proposal to extend double-credit for early PM 

retrofit, but those devices are not yet proven to be safe or economically feasible 

at this point. I urge CARB to please DO MORE! There are still too many flaws 

and unclarified questions that must be answered! (COLLINS) 

Comment: The double credit incentive does not seem to be enough incentive to 

overcome the obstacles to installation of the devices and will not produce the 

results that ARB had anticipated. Without substantial double-credit, the ARB 

cost analysis of cost of compliance with the rule needs to be revised. (CIAQC1) 

Agency Response: Staff acknowledges the impact that the current economic 

recession is having on some fleets, and realizes that some fleets may not be able 

to take advantage of the early VDECS double credit because of a lack of funds. 

However, at the July 2009 Board Hearing, the deadline for receiving VDECS 

double credit was extended further for small and medium fleets, until March 1, 

2012. Therefore, even if they choose to wait until after the current economic 

recession eases, small and medium fleets will still be able to take advantage of 

the early credit available to help spread out compliance costs. For further 

discussion on VDECS costs, please see the responses in Sections 6 and 11 

below. 

Commenter CIAQC1 stated that the cost analysis of the regulation needs to be 

revised if substantial double credit is not received by fleets. However, as stated 

in the Staff Report and Technical Support Document (TSD) for the original 

regulation, no early retrofitting was modeled in the original cost analysis. If any 

fleets take advantage of the early double credit provisions, a cost savings for 

those fleets will result. Therefore, the statewide cost of the regulation in the early 

years of implementation could only decrease from what was estimated. 
-11- 

Additionally, the commenters above suggested that double credit for early 

VDECS installations was not enough to encourage fleets to retrofit vehicles early; 

however, staff disagrees with this statement. Although staff acknowledges that 

not all fleets will take advantage of the early retrofit credit, we believe that the 

double credit will be enough to spur some additional and early VDECS 

installations. Staff did not propose to give any additional credit (beyond double 

credit) because offering more than double credit could result in a further delay of 

VDECS installations, which could result in overall emissions disbenefits. 

See response in Section 10 below regarding VDECS for a discussion of how the 

regulation only requires the use of VDECS when they can be installed and 

utilized safely. 

5. Modify the Regulation Due To the Current Economic Downturn 

Comment: CIAQC recognizes the need for the continued reduction of 

Particulate Matter, Oxides of Nitrogen and visible emissions from off-road diesel 

vehicles; we are convinced, however, that the staff proposed amendments to the 

regulation do not provide all that is needed at this time for it to succeed. 

(CIAQC1) 

Comment: Today we come before you to make the case for additional 

amendments to the off-road diesel regulation, which is also far from perfect. 

During this process -- and I was certainly an active participant in it, there were 

issues about the economic analysis that stated that the construction industry 

could easily afford to replace all of its equipment over the next ten years. 

We have provided a chart that illustrates these economic projections and the 

terrible reality that our industry faces today. 

Madame Chairman, you described our current economic situation as recession. 

For the construction industry, it's a depression. We have unemployment well in 

excess of 25 percent in most of our union trades, and it's going to get far, far 

worse. (SCCA2) 

Comment: We filed a petition on December 15th to modify the rule to reflect the 

dramatic change in the economic, technological, and for that matter, emissions 

conditions as contrasted to those that were anticipated when you adopted the 

rule in 2007. 

The double credit modification is appreciated and is helpful, but it is far short of 

what is needed today. 

What we are seeking is simply your endorsement of our quest to the staff to 

engage in a process of looking at the rule and what modifications are necessary 
-12- 

and are appropriate to reflect today's realities. And in order to keep our feet to the 

fire. And because of the eminence of the short term deadlines, that you give us a 

short term deadline for getting back to you. And in fact that you have us report to 

you every month on our progress. 

Those discussions should also include taking a look at what revisions might be 

appropriate to allow us to access federal and State funding from which we are 

currently barred, because we are talking about required emissions reductions. 

And that seems to be counterproductive. 

Now why is this? The fact is that while the staff has described to you 

enforcement policies, the economic and technological realities that you're hearing 

about are forcing large parts of this industry to be out of compliance by the time 

the near-term deadlines come or to be out of business. (AGC1) 

Comment: Moreover, we believe it is prudent for the Board to consider an 

extension of the initial compliance dates of the regulation concurrently with the 

extension of the double credit deadline. While an extension of the initial 

compliance dates of the regulation may create a concern as to a loss of emission 

reductions; the current state of the economy is creating its own emissions 

reduction. (GCI1) 

Comment: When the In-Use Off-Road Diesel Fleet Rule was adopted on July 

26, 2007, California’s economy and California’s construction industry were both 

booming. Since that time, we have seen the mortgage meltdown, the credit 

crunch, and the Wall Street bailout all contribute to the economic recession for 

California and the construction industry. This means that we are doing less work 

and contributing fewer emissions. 

A reduction of construction work over the past 18 months has led to a significant 

decrease in equipment and utilization across California. This decrease in 

utilization correlates directly with a reduction of emissions purely through 

economic factors. Adding to the absolute reduction in emissions is the fact that 

the equipment still being operating is newer and emits fewer pollutants than the 

equipment being parked. 

CARB Staff and the Board should take into consideration the current 

economically driving reduction of emissions relative to the modeling conducted 

for compliance with the Off-road rule and adjust the initial compliance dates 

accordingly. (GCI1) 

Comment: Re-evaluate the schedule and timing for the rule. The most 

appropriate approach for the ARB is to give itself time to redo the rule. Register 

the fleet, if you must, enforce the idling, identification and sales provisions. Fix 

this before its failures undo the intent of the effort. (CIAQC1) 
-13- 

Comment: ATA has consistently supported ARB’s emission reduction goals for 

the regulated vehicles, including airport ground support equipment (GSE), but 

cannot support the inefficient and unduly burdensome approach for achieving 

those goals embodied in the ORD Rule. 

As more fully explained in the attached, the proposed amendments are welcome, 

but are not nearly adequate to reflect the real impact of the economic downturn 

and the lack of verified retrofits feasible for airport ground support equipment 

(GSE). As a result of the dramatic economic downturn, ATA believes equipment 

use has dropped far enough so that the near-term emission reductions targeted 

by the ORD Rule already have been achieved. There is no emission or 

economic basis for imposing the Rule’s near-term requirements on GSE. 

In this environment, the emission requirements of the Rule should be deferred, at 

least as applied to GSE, long enough to allow a complete assessment of the 

measures needed to achieve emissions reduction targets in light of the economic 

downturn and empirical fleet data due in April, June, and August, 2009 (for large, 

medium, and small fleets, respectively). ATA commits to work in full cooperation 

with Staff in this effort, so that it can be completed as expeditiously as possible. 

Deferring the ORD Rule’s requirements for GSE would be as effective in carrying 

out the purpose of the Rule as proceeding to implement on the present schedule, 

and would be less burdensome on the regulated community. (ATA1) 

Comment: As you well know, the California economy as a whole and the 

construction industry in particular, are in a deep recession. The detailed 

comments below will illustrate how this downturn itself has caused emission 

reductions from the subject engines equal to or in excess of this regulation. 

Lehigh Hanson proposes that the full implementation of this rule be delayed until 

economic conditions make compliance feasible. 

At this time in January 2009, the California Construction industry is recording 

significantly depressed activity levels, largely caused by the worst housing 

market conditions in the US since the Great Depression. The related credit 

availability crisis has also contributed to the reduction in construction spending. 

As the statistics describe, the drop in construction activity alone has equaled or 

exceeded the proposed ORD PM emission reductions required by the regulation. 

This reduction has come at a great cost to the California economy. 

It is proposed that the implementation of the ORD regulation be delayed until 

Construction and Mining industry activity levels begin to rise and then proceed at 

a pace that will allow attainment of the 2020 PM emissions target. 

This delay will also allow the implementation problems discussed above (and 

others) to be addressed and hopefully solved. (KNAPP) 
-14- 

Comment: I'd also like to make a comment that I would request that the Board 

consider postponement of the regulatory deadlines concurrently with the 

postponement of the early credit deadline. I don't make this comment lightly. I 

realize it's a huge shift in the regulation. But I think given the current economic 

downturn, the current decrease in operating hours, fuel consumption, the 

emissions coming out of the stacks of equipment across the state has simply 

gone down since the regulation was adopted. (GCI2)

Comment: The good news is that the environmental impact of this economic 

downturn has been a positive one. Lower overall emissions. Fuel consumption 

for our fleet has dropped from 1.2 million gallons annually in 2006 to under 

600,000 gallons annually last year. Our hours of utilization have dropped by more 

than 50 percent. Those are real emissions reductions. But we get no credit for 

them. If we were to receive credit for them, that would be two-and-a-half years of 

PM credit and almost five years under the NOx portion of the rule. 

To conclude, in light of the current economic downturn, soon to be known as the 

depression, I think that the Board should consider what AGC has suggested and 

delay the implementation of the rule. (DOWNS) 

Comment: I think though that you really cannot deny that we are in a very 

severe economic crisis with a very severe downturn in construction activity. 

We’re asking that given these changed circumstances that the staff work with the 

industry and other stakeholders to take a hard look at what the data yields in 

March or April, what the actual facts are, and that we make decisions about 

whether this rule needs to be modified or can be modified based on facts. 

The construction industry needs your help. It needs the staff to work with us to 

evaluate this data and look at these near term deadlines and determine whether 

there is some flexibility there because of the economic downturn. 

What we're saying is that given this current environment, you actually have some 

room to breath, some flexibility here. And we ought to take that opportunity and 

take a hard look at whether there are ways the rule can be modified without 

impairing public health given the economic downturn to give some breathing 

room to these companies so they can survive. (AGC2) 

Comment: California Air Resources Board’s new emission standards have been 

out of reach for many contractors from the start. We feel that CARB’s efforts are 

noble, but over ambitious. Many companies were proactive and opted to 

purchase the highest tier equipment available through the last decade. The 

current rules are punishing these firms who took a proactive position to clean up 

their fleets and lower their carbon foot prints far ahead of the state’s ruling. 

These efforts have come at great expense to these firms with anticipation that 

they would be rewarded. While their competitors have been rewarded by the 
-15- 

state for their continued use of non tier high emission output equipment that is 

low costs. 

Proactive firms that have taken on debt for years to come and are now faced with 

the dilemma of having to update their fleets once again as the technology has 

outpaced the life of their fleets. All this while still having to pay off some of their 

existing debt on early tier compliant equipment. This early tier equipment has a 

low residual value due to the CARB’s ambitious goals, thus further punishing 

proactive companies for their noble efforts. All this has happened during this 

economic down turn that has effected off road fleets more than any other sector 

in the business community. 

For these firms that have made a real attempt to do the right thing this has come 

as a shock. CARB should work with the companies that can demonstrate their 

proactive efforts to clean up their fleet emissions during the early stages. These 

companies have benefitted the state’s air quality for the past decade, and should 

be rewarded for these efforts. 

Furthermore, CARB’s current goals are far over reaching for our industries 

current economic time. The state will force quality companies to face hard 

decisions to either close their doors or have to greatly down size their companies 

to stay in business. These companies will also be forced to pass this additional 

cost on to their customer base that will further add to the economic crisis we are 

facing. (DDGE) 

Comment: As a company, we're behind you. We don't have a problem meeting 

your requirements and your goals. We have a problem paying for them, 

especially in the next year or two. 

So a lot of things are not going our way right now. Things will get better. But your 

consideration and action on AGC's recommendations before you will go a long 

way towards ensuring our survival the next couple of years. (SYBLON) 

Comment: I would also ask that the ARB reconsider the time frames and the 

impact of theses regulations with respect to our current financial situation as a 

whole on the employer. (MCDONALD1)(MCDONALD2) 

Comment: It is economically impossible for ECCO to consider the compliance 

mandates at this time. And ECCO is respectfully requesting your help with this 

regulation so that we even have any possibility of making it. (ECCO) 

Comment: Please don't force so many of us California Contractors out of 

business during this down turn in the economy! (COLLINS) 

Comment: It is impossible to evaluate the impact of the off-road regulation 

without examining the current economic state of the construction industry in 
-16- 

California. The picture has changed dramatically since 2006 when the staff 

compiled their original optimistic assumptions about the future of the industry. 

Not only were the ARB assumptions way off base, but the framework of the 

existing rule goes well beyond the economy in crippling the industry in California. 

We believe that significant and substantial relief is warranted given these facts. 

1. Currently there are 120,000 construction workers unemployed and the 

projection is for 200,000 to be unemployed by the end of 2009. ARB assumed 

only increases in the size and operation of the industry and the fleet. 

2. Emissions from construction activity have dropped dramatically. Operating 

Engineers’ hours, the individuals who operate this heavy duty equipment, are 

down over 28%. Estimates place the hours at more than a 35% reduction or 

more by the end of 2009. ARB’s assumptions never anticipated a downturn in the 

economy, the industry or its capacity to emit. 

3. Some of the largest contractors, with the largest fleets, report having more 

than 50% of their fleets parked since August of 2008. Small and medium size 

fleets are faring no better. This condition was not included in ARB staff’s original 

projections. 

4. Off-Road diesel fuel consumption used by contractors has declined by over 

30%. There is a virtual one-for-one correlation between operator unemployment, 

machine utilization and fuel consumption. ARB staff recently assumed only a 

10% reduction. By not attempting to corroborate the industry specific data with 

the Board of Equalization’s off-road fuel data to tease out just the construction 

portion ARB’s emissions estimates are grossly overstated. 

5. Equipment sales and auction data indicate that more equipment has left the 

state than has been purchased new in California indicating an overall shrinkage 

in the number of vehicles in California. This is the exact opposite of what ARB 

staff estimated. 

6. A sample of 12 fleets ranging in size from 16 to 1000 machines reveals that 

every fleet has shrunk in both the number of engines and total horsepower, AND 

that the make-up of engine tiers matches what ARB projected it to be in 2010. 

ARB did not anticipate this rapid transformation of the fleet. 

Put simply, things are not at all what ARB staff projected. Emissions are down 

substantially, based on fuel usage, hours of operation, employment and numbers 

of idled equipment and will continue to decline for the next year or more. Further, 

the fleet is smaller than projected, by a substantial margin and continuing to 

shrink. In addition, the fleet is reducing older equipment quicker and the 

percentage of newer equipment is increasing faster than ARB projected, putting 

the fleet ahead of ARB’s projections for emissions reductions. 
-17- 

Given the smaller and newer California off-road fleet there is little likelihood that 

an overnight improvement in the economy (which isn’t going to happen anyway) 

can produce a spike in emissions from the construction industry as the staff 

would have everyone believe, as older equipment is prohibited from re-entering 

the fleet. 

A re-examination of the economic and emission impacts of the rule is warranted 

and necessary if ARB and the Administration are interested in maintaining a 

healthy construction industry as well as a healthy environment. (CIAQC1) 

Comment: I respectfully request that the rulemaking for New Limits on 

Emissions from Existing Fleets of Off-Road Diesel Equipment be reopened and 

re-evaluated in light of the serious downturn in the economy. 

Decline in the Consumption of Diesel Fuel: 

Consumption of diesel fuel for our company has declined by 79% as compared to 

a normal year. 

Resale Value of Equipment in an Existing Fleet: 

In anticipation of the new California Air Resources Board rules our company sold 

at an auction all except one Tier 0 equipment. Our observation has been that 

resale values of older equipment have drastically declined. 

Credit Being Extended to Construction Contractors: 

We are experiencing severe restrictions on available credits in addition to very 

tight covenants. 

I strongly believe it would be in the best interest of Californians to revisit the 

costly new CARB rules, especially in light of the troublesome economy 

automatically resulting in reduced emissions. Strict enforcement will result in 

many contractor's going out of business. (VCMI) 

Comment: ATA always has supported achieving the emissions reductions 

sought under the ORD Rule, but has not supported the regulation as currently 

structured. The proposed amendments are welcome, but not nearly enough. 

As a result of the dramatic economic downturn, ATA believes equipment use has 

dropped far enough so that the near-term emission reductions targeted by the 

ORD Rule already have been achieved. There is no emissions or economic 

basis for imposing the Rule’s near-term requirements on airport ground support 

equipment (GSE). 

The emissions requirements of the Rule should be deferred, at least as applied 

to GSE, long enough to allow a complete assessment of the measures needed to 

achieve emissions reduction targets in light of the economic downturn and the 

empirical fleet data due in April, June, and August, 2009, for large, medium, and 

small fleets, respectively. 
-18- 

The present regulatory structure cannot be justified economically, even in 

relatively good economic conditions. 

The economic downturn has been and likely will continue to be very painful; the 

silver lining is that it has resulted in drastically reduced emissions as a result of 

the reduction in equipment activity. 

The Near-Term Reductions in GSE Emissions Will be Achieved Even Without the 

ORD Rule Due to the Dramatic Economic Downturn. 

GSE does not operate unless planes are flying – when planes do fly, GSE does 

not operate at the same levels if servicing reduced passenger and cargo loads. 

The ORD Rule was premised on projected airline activity growth: 

ARB Projected Growth in GSE Population (Percent) 

 2008 2010 2011 

from 2000 Baseline 18.8% 23.1% 28.5% 

from 2004 Baseline 7.9% 11.8% 16.7% 

Source: Growth Rates applied GSE in OFFROAD2007 Model 

In fact, aircraft operations in California have dropped dramatically. 

Change in Scheduled Aircraft Activity (Percent) 

 2008 2009 

from 2000 Baseline -11.2% -19.5% 

from 2004 Baseline 1.2% - 8.2% 

Source: ATA, based on Seabury APGDat airline schedules. 

Data from California’s large airports shows the decline is even more dramatic at 

the airports in Non-Attainment Areas (data subject to update). 

Actual Airline Activity as Reported by Large & Medium Hub Airports (LAX, SAN, 

SFO, BUR, OAK, ONT, SJC, SMF, SNA) (YTD November) 

2008 

 2004 2007 ∆ from 

2004 

Aircraft 

Movement

s* 

1,234,672 1,241,754 1,084,870 -12.1 % 

Passenger

s 

152,015,71

7 

159,926,89

1 

139,541,88

4 -8.2 % 

Cargo 

(tons)* 3,245,333 3,196,645 2,367,975 -27.0 % 

* Excludes Oakland because data not available 
-19- 

Airlines do not anticipate restoring service levels in California in the foreseeable 

future, with further reductions possible, and already are reducing GSE fleet sizes. 

The ORD Rule was intended to reduce PM emissions by 14% compared to the 

baseline in 2010. In 2011, the Rule was to achieve about a 25% PM reduction. 

See Initial Statement of Reasons for Proposed Regulation of In-Use Off-Road 

Diesel Vehicles (April 2007) at 34 & 35, Figure VI-2 (“ISOR”). 

Under any reasonable scenario, GSE emissions will remain below the levels 

targeted by the ORD Rule at least through 2010 or 2011, even without the Rule’s 

requirements. 

ORD GSE PM Emissions

0.00

0.05

0.10

0.15

0.20

0.25

20042005

20062007

200820092010

Year

PM Emissions, tpd

OFFROAD w/o Rule

OFFROAD with Rule

Predicted by Airline

Activity

The high penetration of electric GSE in the South Coast, and the de minimis GSE 

population in the San Joaquin, further ensure that deferring the Rule for GSE will 

not adversely effect South Coast and San Joaquin attainment efforts. 

ARB Staff Has Understated the Impact of the Economic Downturn 

After issuing the proposed Amendments, Staff used data from the California 

Board of Equalization (BOE) to conclude that regulated vehicle activity in 2008 

was slightly higher than in 2004, and is consistent with the assumptions 

underlying the ORD Rule. 
-20- 

Staff correctly acknowledged that “the specific changes in fuel use by fleets 

affected by the regulation (for example, the construction industry) cannot be 

derived from this data,” but incorrectly assumed that the data “is likely reflective 

of general trends from all users of off-road diesel fuel.” Staff Report at 39. 

Fuel use data from the U.S. Energy Information Agency (U.S. EIA) establishes 

that diesel use in the sectors covered by the ORD Rule is down significantly. 

Of the sectors covered by the ORD Rule, only off-road construction diesel use is 

tracked as a separate category by the U.S. EIA. That data shows diesel use for 

off-road construction has declined steadily since 2004 and, as of 2007, was 27% 

below 2004 levels.1 This sector accounts for at least 50% of emissions covered 

by the regulation. 

Data from the U.S. EIA shows diesel use in the rail sector has remained high and 

is now 2.5 times larger than construction use; marine use is 127% higher than in 

2004. The inescapable conclusion is that the inclusion of other sectors in the 

BOE data masks the dramatic declines in usage in the construction sector. 

Diesel Consumption Indexed to 2004

0%

20%

40%

60%

80%

100%

120%

140%

2004 2005 2006 2007 2008

Year

Consumption Relative to 2004

Dyed Fuel (All Sources) - BOE Data

Off-Road Construction - USEIA Data

With the corroborating economic data from the airline and construction industry, 

one can only conclude that diesel use in these sectors has declined dramatically. 

The Rule’s Economic Basis is Gone -- Implementing it Now Will Cause Needless 

Economic Harm. 

 

1

 U.S. Energy Information Administration, data available here: 

http://tonto.eia.doe.gov/dnav/pet/pet_cons_821use_dcu_SCA_a.htm
-21- 

When adopted in July 2007, Staff concluded that the ORD Rule requirements 

were at “the economic limit of what industry could bear.” ISOR at 3 (emphasis 

added). 

As the data above shows, airline economic activity has declined rapidly and the 

decline is accelerating. 

Construction activity (50% of emissions covered by the Rule) has dropped at 

least as dramatically. 

Given the economic crisis, the near-term Rule requirements are now plainly 

beyond “the economic limit of what industry could bear.” 

Staff has not even estimated the job losses and economic impact of the ORD 

Rule in the current economy. (ATA1) 

Comment: I came here to ask the Board, given the extraordinary economic 

circumstances that we find ourselves in, to step back and consider the effort or 

the effect of the economic downturn and how emissions reductions targeted by 

the rule can be achieved without afflicting unnecessary economic harm. 

Let me be clear. The Air Transport Association has always supported the 

emission reduction targets of this rule. We understand how important it is to work 

with you to protect public health and the environment. I think the staff will agree 

that we've done that throughout this process and we continue to want to do that. 

I'm not here to ask you for a handout or a free pass. I'm asking you to take a 

breath and assess what in fact is needed in these circumstances to achieve the 

emission reduction targets that we all support. 

We've submitted comments that you all should have which include data on the 

effect of the economic downturn. When you all pass this rule, you expected, as 

we did, that the air transport industry would grow. The fact is that we've 

contracted. There are far fewer passengers being transported, far less cargo, far 

fewer planes being operated. Even as we're speaking today, airlines are 

reporting their financial results and projecting that they're going to reduce 

capacity even further. 

This means that emissions are down. And they're far below what was anticipated. 

Coupled with staff's conclusion over a year ago that the rule imposes 

requirements at the limits what industry could bear, there's simply no reason to 

barge ahead with a rule without taking time to consider what is needed and 

economically feasible to achieve the reductions we all support. 

Pausing now won't hurt the environment. I think pausing will certainly cause 

unnecessary economic harm to our industry that's already hurting. 
-22- 

It seems to me that staff today -- and I don't want to put words in their mouth -- 

but it seems they're saying they need more information to assess the effect of the 

economic downturn. We agree with that. We don't think that the remedy is to 

simply monitor the situation. Because the fact is the first requirements are 

coming up quickly, and we need to work now to get ourselves in a position to 

comply. So if something needs to be done, its needs to be done now. (ATA2) 

Comment: The projected ORD PM emission in 2010 were -26.2% from 2000 

levels. The drastic reduction from 2000 levels in California Construction & Mining 

industry activity in 2007 -19.3%, and the projected levels for 2010, -26 to -32%, 

indicate that the economic conditions have equaled or exceeded the PM 

emission reductions that would have been attributed to the ORD regulatory 

program. (KNAPP) 

Comment: And so it is that we come before you today to make the case for 

additional amendments to the off-road diesel regulation, which is far from perfect. 

First among its flaws was the ludicrous economic analysis that showed how the 

construction industry could easily afford to replace all of its equipment over the 

next ten years. 

We support the amendments before you today, but we also petition the Board to 

consider CIAQC’s proposal to revisit this flawed regulation and get it right before 

implementation and enforcement. To do otherwise is to compound the flaws and 

watch the rule fail to meet its objectives of cleaning up emissions from the 

construction fleet. (SCCA1) 

Comment: Essentially, everything in the construction industry peaked in July of 

'06, which we tried to tell your staff back when this rule was being adopted. And 

it's been going down and has shrunk considerably sense. 

Most importantly, if you want to know what's happening with emissions, you have 

to look at operating engineers hours, because those are the guys that drive the 

equipment. Their hours are currently down 40 percent and expected to continue 

to drop for the next 18 months. 

So if I can summarize, we think you need to make a very thorough and 

independent evaluation of economic impacts of the rule and the industry's ability 

to comply, particularly with regard to the safety issues. (CIAQC2) 

Comment: (Submitted in conjunction with comment CIAQC2 above) 
-23- 

(LEWIS) 

Comment: The last one I'd like to bring up is the current state of the economy. 

Our industry is changing drastically weekly. Our industry has reduced -- our 

customers have reduced their activity and the capital that they are investing in 

their facilities. This has resulted in a decline in our revenues, a decline in the 

utilization of our equipment, a decline in emissions. And our goal is just to survive 

this period of time. 

Our capital budget has dried up to -- our capital budget has been reduced by 75 

percent. We cannot pass any cost on to our customers. We're heading the other 

way. The compliance cost dollars are going away. And we ask that you take 

some time and just re-evaluate the current economy. It's changing drastically. 

(NWS) 
-24- 

Comment: Staff also stated in their rule back in July 2007 somewhere between 

1400 and 3400 jobs annually will be lost under this rule. That could be as many 

as 71,400 jobs over the 21-year-period. I suggest that that is the wrong time to 

knowingly put people out of work. I believe staff would find there is a closer 

relationship between poverty and public health than PM emissions and public 

health. (DOWNS) 

Comment: As far as financially, hopefully I will be able to stand with you next 

year giving you an update. I'm not sure. We've bid a Caltrans job. The 

engineering estimates used to be where you would start was a $60 million job. 

We got the job, 43 million. But tenth bidder was 49 million. And that's not unusual 

right now. We are just out there trying to stay alive right now. 

It is a recession. Our emissions are a lot lower. We're not using our equipment. 

And we need your support to make sure we survive. 

1989, the earthquakes, we were there taking apart the bridge where the people 

were trapped. If we have a disaster, we need the contractors -- the heavy civil 

engineering contractors to be around to help us out. (BAYCITIES) 

Comment: This delay will also allow the implementation problems to be 

addressed and hopefully solved. (KNAPP) 

Agency Response: As stated in the staff report for these amendments, we 

recognize that the economy is in a recession. However, at the time these 

amendments were proposed in January 2009, we did not have adequate data to 

determine the effect of this recession on off-road vehicle emissions. Because of 

the lack of data, we did not propose any additional amendments beyond 

extending the deadline for retrofit double credit to further relax the requirements 

of the regulation, even though many commenters (including CIAQC1, AGC2, 

ATA1, and ATA2) stated that the recession had downsized the size of the state’s 

fleet of off-road vehicles, resulting in reduced fleet emissions. 

Overall, while staff found that lowered fleet activity has likely decreased 

emissions from staff’s previous estimates, changes in fleet turnover practices 

during an economic downturn, on the other hand, can result in increased 

emissions, that somewhat offset the reductions from reduced activity. 

Consequently, it was necessary to have a thorough understanding of the makeup 

of fleets and vehicle turnover to accurately estimate the emissions impact. At 

the time of the Board hearing, staff did not yet have adequate data to quantify the 

effect of changes in turnover practices, and is continuing to evaluate the data 

using fleets’ initial reporting information from 2009 and data that will be reported 

in 2010. Staff is committed to return to the Board in December 2009 and report 

on current economic conditions and the most recent data reported during the 

2009 initial reporting period of the regulation. 
-25- 

Beyond staff’s commitment to evaluate and report on economic conditions and 

their effect of state fleets, shortly after the January 2009 Board Hearing, the 

California Legislature adopted Assembly Bill 8 2X (AB 8 2X, which is also often 

cited as ABX2 8), which directed ARB to make several amendments to the offroad regulation, as part of the California budget. These amendments, referred to 

as the AB 8 2X amendments were then approved by the Board at the July 23, 

2009 Board Hearing. 

The stated legislative intent of AB 8 2X is to provide economic relief and to 

preserve jobs in the construction industry, and effectively allow fleets heavily 

impacted by the recession to delay compliance with the in-use off-road 

regulation’s requirements, especially in compliance years 2010 and 2011. The 

AB 8 2X amendments allow large fleets to claim both PM and NOx credits in 

2010 and 2011 if they have experienced a reduction in fleet activity from July 

2007 to March 2010. Additionally, the amendments allow for PM and NOx credit 

(for all fleet sizes) if the fleet has reduced its total horsepower from March 1, 

2006 to March 1, 2010. 

The AB 8 2X amendments also provide additional compliance flexibility by 

allowing large fleets the option of delaying a portion of their compliance 

obligations for 2011 and 2012 until 2013. The AB 8 2X amendments will 

significantly reduce compliance costs for off-road fleets over the next several 

years. 

Although the commenters above requested the Board to take more actions to 

modify the regulation at the January 2009 Board Hearing, we believe the addition 

of the AB 8 2X amendments adequately addresses their concerns, but, as stated, 

staff is continuing to evaluate the issue. The commenters are correct that the 

regulation was developed during a period of industry growth and that the current 

economic downturn was unforeseeable when the regulation was developed. 

However, staff believes that the AB 8 2X amendments will give fleets additional 

flexibility during this downturn. 

Commenter DDGE is concerned that ARB is punishing those fleets that have 

been proactive, and have upgraded their vehicles over the past several years. 

Staff does not believe this to be true. For fleets that have complied, the 

regulation provides a large number of early credits for actions previously taken to 

upgrade vehicles; this includes credits for repowers, exhaust retrofits and vehicle 

replacements and/or retirements. In addition, fleets that took action early to 

move to cleaner, higher tier vehicles have cleaner fleet averages and are 

therefore closer to meeting the regulation’s fleet average targets than other 

fleets. Additionally, as stated in Chapter III.A.3 of the FSOR for the original 

regulation, staff does not believe that the regulation will decrease the value of 

most vehicles. The off-road vehicle market is a global one, and therefore the 

regulation alone is not expected to cause a drop in equipment value. 
-26- 

Commenter DOWNS expressed concern regarding the number of jobs lost over 

the course of the regulation; however, staff believes this commenter 

misinterpreted the original job loss estimates presented in Chapter XI of the TSD 

for the original regulation; these numbers were lower than the numbers 

presented by the commenter above. The original job loss analysis estimated that 

in its highest cost year, the regulation could result in a loss of 1,000 jobs across 

the California economy. However, a job loss estimate of this magnitude is not 

expected each year. Additionally, this estimate did not take into account jobs 

created by the regulation in areas such as exhaust retrofit manufacturing. Also, 

with the addition of the AB 8 2X amendments, many fleets will be able to spread 

out their compliance requirements (and costs) during the initial, more costly years 

of the regulation, therefore avoiding potential job losses. 

Commenter KNAPP stated that delaying the regulation would allow ARB staff to 

solve any implementation problems that have arisen. However, staff believes 

that it is necessary to implement this regulation now to achieve necessary 

emissions reductions across the state, and does not believe there are severe 

implementation problems that justify delaying implementation of the regulation. 

Staff will continue to implement the regulation as scheduled, and will update the 

Board periodically on the status of any compliance issues that may have arisen 

during the course of implementation. 

Commenter ATA2 argued that delaying the regulation now will not result in any 

harm to the environment; however, staff disagrees. As stated above, if it can not 

be definitively shown that emissions have decreased, delaying the regulation will 

result in a decrease in emissions benefits. Therefore, a delay in the regulation 

could harm the environment if a lack of emissions reductions occurs. 

For a response to the comments requesting a change in the regulation due to the 

lack of current technology, please see the response in Section 6 below. 

6. Modify the Regulation Due to the Lack of Technology 

Comment: The continuing lag in technology makes a postponement of 

compliance dates a necessary and logical step. 

(GCI1) 

Comment: While it is encouraging to see the development of retrofit technology 

over the past few months, the six VDECS currently verified for mobile off-road 

applications still only cover a fraction of Granite’s fleet. Furthermore, the most 

recent verifications have only served to duplicate potential retrofit installations 

rather than to expand the pool of possible retrofits. 

Granite’s California fleet of off-highway diesel equipment is made up of 

approximately 1100 pieces of equipment totaling nearly 220,000 horsepower. 

Even if Granite is able to take full advantage of the double credit extension, the 
-27- 

task of retrofitting 110 machines/22,000 horsepower in the next year with limited 

technology available is a huge challenge. 

To break down Granite’s fleet, 600 of Granite’s 1100 California machines 

(including most high-horsepower machines) do not have a verified VDECS. Of 

the 500 machines that do technically fall under a verification, 170 are in low-load 

applications that do not support the verification requirements. Taking into account 

additional requirements such as turbocharger arrangements, safety, operability, 

and feasibility, the number of machines in Granite’s fleet that can realistically be 

retrofitted with a DPF falls to under 200, or less than 18% of Granite’s fleet. 

With the extension of the double credit deadline, Granite will be able to meet the 

2010 requirements of the off-road regulation, but compliance beyond 2010 is not 

possible without extensive additional verifications. At this point, it is not possible 

for us to adequately plan or implement emissions reduction strategies beyond 

2010 in the absence of viable technology. It imposes an oppressive burden if our 

industry is left to guess what technology may or may not become available in the 

next few years. 

To conclude, Granite Construction is fully in favor of the proposed extension of 

double credit for compliance with the In-Use Off-Road Rule. Additionally, we 

hope you will consider an extension of the initial compliance dates of the 

regulation to provide more technological certainty, since this extension can be 

offset through realistic modeling adjustments to reflect existing conditions in the 

marketplace. (GCI1) 

Comment: Re-evaluate the schedule and timing for the rule. With the crushing 

pressure of economic, technical and safety failures weighing on this regulation, 

the most appropriate approach for the ARB is to give itself time to redo the rule. 

Register the fleet, if you must, enforce the idling, identification and sales 

provisions. Fix this before its failures undo the intent of the effort. (CIAQC1) 

Comment: CIAQC supports the proposed changes in the regulation but 

question whether or not they will achieve any significant results due to conditions 

that will prevent contractors from taking advantage of the extended deadline for 

double credit. Those factors include the lack of verified VDECS that can meet the 

industry’s rigorous performance requirements. 

Reduce the VDECS requirements. At least until the supply can equal demand. 

This is not a free-market economic scenario—it is a command and control 

economic approach. VDECS manufacturers have no incentive to reduce prices 

as they are guaranteed a market for their products—and they still can’t meet the 

artificial regulatory demand. Even if the manufacturers could meet demand there 

are not a sufficient number of qualified installers to actually put the things on the 

machines. (CIAQC1)
-28- 

Comment: The second major error in the off-road diesel regulation is its overreliance on promises of the VDECS suppliers that there would be adequate 

supplies of these devices to meet the requirements of the rule. Now, with the 

reality staring us in the face we know that there are perhaps six suppliers who 

can cover less than 20 percent of the fleet. (SCCA1) 

Comment: I'd also like to express my concern about the availability of 

technology even given an extension of the double credit deadline to meet the 

requirements of the regulation. When you look at Granite's fleet and you start 

whittling away at the pieces of equipment that don't have a verified device for that 

engine, you whittle away the older equipment, you whittle away the new 

equipment, you whittle away the large equipment, you whittle away the low load 

equipment, and you whittle the equipment that need the specific requirements of 

each verification, you end up with some number under 20 percent of our total 

fleet horsepower that can be retrofitted. 

There needs to be significant additional devices verified. There needs to be, you 

know, a wide variety of both active and passive devices for a wide range of 

engine horsepowers to meet the requirements of the regulation. And given where 

we stand now, that's just not available. (GCI2) 

Comment: The current regulation will require VDECS to be installed on the 

California construction fleet at the rate of 20% of the vehicles each year. By 2010 

ARB estimates that 35,412 devices will need to be purchased and installed in the 

statewide fleet. Currently, after five years of effort there are approximately 450 

devices installed statewide. In addition, the ARB Showcase which was to have 

250 devices installed over a year ago has less that one-dozen in place and little 

idea when the balance will be installed, if ever. Staff dismisses the very real 

obstacles (contracts, reduced usage, retirement, inability to match devices to 

machines, manufacturers withdrawing) to implementing the Showcase. 

Nevertheless, the hurdles encountered by the Showcase participants are being 

experienced by every contractor in the state and are very real impediments to 

installing VDECS. (CIAQC1) 

Agency Response: Many of the commenters (including commenter GCI1) 

argued that the timeline of the regulation should be delayed based on the lack of 

verified technologies. As stated in section 2449(e)(8) of the regulation, if a 

VDECS is not available, or one cannot be safely installed on a vehicle, that 

vehicle does not have to install a VDECS in that year; no other action must be 

taken on that vehicle because there is no available VDECS. Therefore, a fleet is 

not penalized if there is no VDECS available for a vehicle. Since there is no 

penalty for lack of VDECS, staff does not believe a postponement in the 

regulation is necessary. 

Additionally, commenter GCI1 is concerned that there are VDECS available for 

only half of their vehicles, and stated that compliance beyond 2010 would be 
-29- 

impossible. However, as stated above, if no VDECS are available, a fleet will not 

be penalized, or considered out of compliance because of a lack of VDECS 

available. Therefore, commenter GCI1 should not be concerned about being out 

of compliance if there are no VDECS available for all vehicles in its fleet. 

Additionally, staff disagrees that there are not enough available, proven, or safe 

VDECS currently in the market. As stated in the staff report for these 

amendments, 60 percent of the horsepower of affected off-road vehicles are 

capable of having a passive VDECS installed; an even larger percentage are 

capable of having active VDECS installed. Also, since the release of the staff 

report for these amendments, several new devices have been verified and a few 

devices have expanded their verification. Therefore, staff does not believe there 

is a lack of available technology, and does not agree that the regulation should 

be postponed for this reason. 

Commenter GCI1 was also concerned that many of the new verifications serve to 

only duplicate potential retrofit installs. However, staff does not see this as a 

problem, rather, an opportunity to lower retrofit costs by introducing more retrofit 

options for fleets into the market. Additional verifications in areas where there 

are currently verified devices do not directly address the commenters concerns 

regarding the limited number of devices, but see response to commenter’s 

concerns in first several paragraphs of this response. The commenter should be 

aware that this scenario will most likely result in more choices and potentially less 

costly devices for its vehicles that can be retrofitted. 

For a response to delaying or modifying the regulation due to the current 

economic downturn, please see the response to Section 5 above. 

For a response to the safety issue raised by commenter CIAQC1, please see the 

response to Section 10 below. 

Comment: Deferring the GSE Requirements Will Not Compromise Emission 

Reductions, and May Allow More Efficient Investment in Tier 4. 

A deferral may allow airlines to invest directly in more new Tier 4 vehicles (the 

most efficient and best technology). Tier 4 nonroad vehicles are expected to 

become available starting in 2011-2013 (depending on horsepower). (ATA1) 

Agency Response: Staff disagrees that deferring GSE requirements would not 

lead to a lack of emissions reductions, and would also like to note that there are 

many provisions in the regulation which allow GSE vehicles to comply with the 

regulation in ways that do not require the installation of VDECS. Therefore, a 

deferral of the regulation is not necessary. As stated in Chapter III.A.3. of the 

FSOR for the original regulation, staff anticipates that many GSE fleets will use 

alternative compliance methods that will not include the use of VDECS. Airline 

stakeholders told staff several times during the workshop process for the 
-30- 

regulation that they prefer to comply without installing retrofits. The off-road 

regulation contains section 2449(d)(1)(A)3.b., which states that any electric 

vehicles added to a fleet between 2010 and 2016 will receive double credit (i.e., 

all electric vehicles added to the fleet will count as double the horsepower with 

PM and NOx emission factors of zero). This provision, which was added to the 

regulation at the request of the Air Transport Association, will allow GSE 

equipment to be replaced with electric vehicles, and potentially lower a GSE 

fleet’s PM averages enough to avoid installing PM VDECS. The electric double 

credit provision lasts through 2016, at which time Tier 4 vehicles will be available, 

allowing GSE fleets to upgrade to Tier 4 vehicles that do not require the 

installation of VDECS. Since the regulation already provides the flexibility for 

GSE fleets to avoid VDECS until Tier 4 vehicles are available, a delay in the 

regulation is not necessary at this time. 

7. VDECS Do Not Work and Are Not Reliable 

Comment: There is ample anecdotal evidence from contractors that the devices 

do not perform to a level suitable for the duty cycle of most off-road construction 

equipment. A device that performs for only two hours before it requires the shutdown of the machine in order to regenerate is not suitable for most applications 

in the industry. Unfortunately the ARB verification process only determines a 

device’s level of performance while it is operating, regardless of how short a 

period of time it actually operates. It gives a very misleading picture of how many 

verified devices are really available, when most cannot operate an entire work 

shift without regenerating. Contractors are not going to install devices that will 

require work interruptions due to frequent regeneration or unreliable operation. 

(CIAQC1)

Comment: If the SHOWCASE is any indication, the data logging, development 

of installation specifications and matching devices to the specific machine duty 

cycle is a time consuming exercise. In addition each installation requires a 

unique design. Merely grabbing a device off the shelf and slapping it on a 

machine is impossible. It takes months of analysis and review. No contractor is 

going to do more than one of these costly devices at a time until it is proven that 

the device will actually work reliably on a give type of equipment, something ARB 

has been unable to demonstrate with any degree of certainty. (CIAQC1) 

Comment: In closing, we have been researching retrofit devices. In most 

cases, the devices presently available complicate the operation of the equipment 

that they will be placed on. (WIPF) 

Comment: The control effectiveness of the DPFs and their frequent 

malfunctions are also testing the viability of this technology. (KNAPP) 

Comment: I don't think you can deny that VDECS haven't performed as 

predicted. How badly they're off that prediction is a matter of debate. (AGC2) 
-31- 

Comment: On the technology front, I'd like to share an in-field experience. My 

company just installed a 2008 on-road engine that has a passive diesel 

particulate filter. It has been installed for 60 days. And in that 60 days, it's 

regenerated every day. And we've had two manual regenerations that require the 

use of a computer to tie into the brain of the engine. Our customer is not willing to 

pay for the down time. (NWS) 

Comment: A device being verified is no indication that the device is applicable 

to a piece of equipment and safety issues need to be resolved. 

Another challenge for the construction industry is the ample evidence that the 

devices don't always perform with the duty cycles of the engines, making the 

equipment not suitable for the construction industry. And that has to do with the 

duty cycle and how often these active devices need to regenerate. We've heard 

instances where after just a couple hours the construction equipment needs to be 

shut down while device or devices two in some instances or more independently 

need to regenerate. And that's a problem. (CIAQC3)

Comment: I think the fact that you need to do this is sort of symptomatic of the 

bigger problem that we've got with VDECS. There aren't sufficient options. The 

installations are problematic, particularly with regard to safety. And I would 

encourage you not to show those photos to OSHA, because many of those 

installations aren't going to pass the safety test. 

And the devices simply don't work on the engines for which they're verified. The 

staff estimated originally they would need to install 35,000 of these devices over 

the next 13 months. That's a billion dollars. The construction industry doesn't 

have that kind of money to spend in that period of time. 

In the showcase, you were talking about doing approximately 250 engines over -- 

that program was supposed to be in place and fully done by over a year ago. You 

had the money. You had the machines. And you had the devices. The fact that 

you've only been able to get nine of them installed ought to be a big red flag. You 

haven't been able to data log most of those machines, and that's the first step 

and the easiest step in making what is a very complex device selection and 

machine pairing process. 

You're going to hear from contractors today how difficult it is or impossible to 

match a device that will work with their equipment. And they have the added 

burden of not having money or the choice of options that you had in the 

showcase. 

And that's why we're going to be recommending that you take a good hard look 

at this program and reassess that burdens that you've placed on the construction 

industry. We don't concur with the staff's assumption that somehow they are 
-32- 

going to get greater emissions as a consequence of any further changes in the 

rule. (CIAQC2) 

Agency Response: Many commenters stated that VDECS are complicated to 

use or install, and are unreliable. Similarly, some of the comments mentioned 

the Showcase, and that this program has started out slow because of device 

installation and performance issues. Staff acknowledges that some VDECS are 

complex; however, if passive devices are used, these VDECS can function as 

direct muffler replacements, which are more desirable for the vehicle operator. 

When staff reported to the Board in January, it acknowledged that fewer devices 

than expected had been installed to date through the Showcase program; 

however, much of the delay was due to contract issues with certain fleets 

participating in the program, not retrofit complexity. 

Even though staff expected thousands of VDECS to be installed during the initial 

years of the regulation, this is not the only way for fleets to meet their PM 

compliance requirements. For example, a fleet may elect to add cleaner vehicles 

to its fleet, replace older, dirtier vehicles with cleaner ones, or simply to retire the 

older, dirtier vehicles and thereby downsize the fleet. 

For a further discussion on why the regulation should not be changed because of 

the issues with VDECS, please see the response to Section 6 above. 

8. VDECS Are Not Appropriate for GSE 

Comment: The ORD Rule’s heavy reliance on retrofitting existing equipment 

with VDECS in early years is wasteful, since the retrofitted equipment must be 

replaced with new Tier 4 to meet the Rule’s later NOx fleet average targets. 

This is particularly true for GSE: 

VDECS are ill-suited to GSE, which are very specialized vehicles. To our 

knowledge, level 3 VDECS have never been successfully installed on GSE, and 

airlines’ initial compliance efforts have confirmed the technical and safety 

problems. 

GSE are less than 1% of the vehicles regulated by the ORD Rule, and represent 

a very small and unprofitable sector for VDECS makers because GSE’s 

specialization requires custom installation attempts. 

ARB’s stated interest in ensuring a market for retrofit makers would not be 

impacted by a deferral for GSE. Only about 1,500 GSE are subject to the 

regulation (less than 1% of the total), and they are too specialized to provide 

economies of scale for retrofit makers. Further, GSE are subject to stringent 

safety protocols and procedures that do not apply to other off-road equipment. 

Thus, GSE do not provide a profitable market for retrofit makers, and allowing 
-33- 

GSE to reduce emissions by other means will not undermine ARB’s goal of 

supporting retrofit makers. (ATA1) 

Agency Response: Commenter ATA1 expressed concern that retrofitted 

equipment must be replaced by Tier 4 equipment by the end of the regulation; 

however, this is not accurate. As presented by staff at the May 25, 2007 Board 

meeting, a fleet does not need all Tier 4 and Tier 4 Interim vehicles to comply 

with the final requirements of the regulation. Staff has shown that a fleet can 

comply with the final compliance requirements utilizing a mix of vehicles with Tier 

2, Tier 3, and Tier 4 engines. Therefore, if a vehicle that is Tier 2 or 3 is retrofit 

now, it is likely that that vehicle can remain in the fleet and still meet the final 

compliance requirements. For a more detailed response to commenter ATA1’s 

concern about the appropriateness of VDECS on GSE equipment, please see 

the response to Section 6 above. 

9. VDECS Safety Issues 

Comment: For nearly a year, CIAQC has been raising the issue of the safe 

installation and operation of the VDECS devices. Because of their size, heat 

generation, fuel consumption and weight, the installation of the devices raises 

serious safety issues for fleet owners. Since most VDECS retrofits are external to 

the engine compartment these issues are valid on almost every machine in the 

off-road fleet. Reductions in operator visibility are a major concern for OSHA and 

MSHA and many of the existing installations have been deemed a violation of 

those agencies’ regulations. Since 2000 there has been one fatal or severe 

crushing accident, every month, without the installation of these devices. 

Widespread enforcement by OSHA and MSHA could result in the removal of 

most of the existing installations. ARB staff dismisses the seriousness of this 

issue and points to a cumbersome and yet-to-be-utilized appeals process as a 

way to resolve the issue. Contractors are not going to risk employee safety 

and/or potential OSHA violations without an advance determination of the safety 

of the installation. This issue stands as a significant barrier to the early 

installation of the VDECS and could undermine the entire retrofit element of the 

off-road rule. ARB, OSHA and MSHA are putting all contractors in jeopardy of 

double violations by not resolving the issue of their conflicting regulations. The 

double credit incentive does not seem to be enough incentive to overcome the 

obstacles to installation of the devices and will not produce the results that ARB 

had anticipated. Without substantial double-credit, the ARB cost analysis of cost 

of compliance with the rule needs to be revised. 

Safety has to be resolved. There is a significant difference between a theoretical 

“premature death” and the real death of construction workers crushed by a big 

yellow machine driven by an operator who simply can’t see. The current 

exemption and appeals process will significantly slow the installation of VDECS 

while contractors await decisions of the “process.” Further, contractors are not 

going to apply for exemptions until it becomes time to install the device on their 
-34- 

own machine. It is already clear that the certain devices are unsafe on many 

machines. ARB should at least post warnings on their web site pending the 

decisions of the exemption process. (CIAQC1) 

Comment: Another problem is the feasibility of applying DPFs to large 

horsepower equipment that were not originally designed for these filters. Safety 

concerns due to blocked visibility and higher operating temperatures are 

becoming apparent with these installations. (KNAPP) 

Comment: During 2006-2007, we repowered 29 pieces of equipment using Carl 

Moyer funding. For the last ten, we were required by the Carl Moyer contract to 

put on DPFs which we did. We tried to get out of the installations, and asked 

CARB to grant us a waiver so we wouldn’t have to install them. We also asked 

the district for a waiver, but we were not successful, therefore, we had to install 

the DPFs. 

And once we had the first one repowered, I could see some real strong concerns. 

I requested CARB to come over and take a look at those, which they did. We 

never got a response from them. So we had to rent them we had needs for that 

equipment. 

Once we got them out on the job site, I had calls for safety concerns, operational 

concerns. One customer told us they are unsafe. As soon as that happened, I 

had to park all the machines. I wrote a letter to the Executive Officer of CARB on 

June 11th asking for a waiver so we could get out of those. 

On June 11th, we had a meeting -- on August 1st, we had a meeting with CARB 

and OSHA. We had another one on August 1st -- on September 30th. We finally 

received a letter from CARB saying we don't find them fundamentally unsafe. But 

if you do, you can take them off, which we did because we had to go to work. 

(ECCO) 

Comment: I just wanted to address couple of the challenges that industry is 

finding and experiencing with the VDECS. That a device can be verified is no 

indication that the device is applicable to a piece of equipment. Also safety 

issues need to be resolved. 

Nobody wants to move forward with installing devices on their equipment if 

there's any sort of potential to harm or injure or in worst case kill somebody 

because of problems with heat or problems with visibility, and we just think that it 

needs to be resolved as to whether or not these devices are safe on a particular 

application. 

And it needs to happen quickly, because in March of next year 35,000 devices 

are supposed to be in place, or at least that's the estimate for the regulation. 

(CIAQC3) 
-35- 

Comment: I think the fact that you need to do this is sort of symptomatic of the 

bigger problem that we've got with VDECS. There aren't sufficient options. The 

installations are problematic, particularly with regard to safety. And I would 

encourage you not to show those photos to OSHA, because many of those 

installations aren't going to pass the safety test. (CIAQC2) 

Agency Response: Staff would like to note that the regulation only requires 

retrofits if they are verified under ARB’s verification procedure and can be safely 

installed. If a vehicle does not have a highest level VDECS or if one cannot be 

safely installed, section 2449(e)(8) of the regulation exempts that vehicle from 

the retrofit requirements. Therefore, a fleet is never required to install a device 

that is not proven, or is unsafe. 

Additionally, as stated in the staff report for the January amendments, staff 

recognized that some VDECS installations could present potential safety hazards 

and that in some cases it would not be possible to install a VDECS safely. 

Because of this, staff is currently working with staff from the California 

Occupational Safety and Health Administration (Cal\OSHA), the Mining Safety 

and Health Administration (MSHA), the construction and retrofit industries, and 

organized labor to develop the protocol for evaluating claims of unsafe 

installation of VDECS. Cal\OSHA and MSHA staffs have been helpful in 

assisting staff in compiling a summary of all relevant safety regulations. 

Cal\OSHA and MSHA staffs have also agreed to work with ARB as part of a 

group that will review safety appeals. Staff also anticipates working with this 

group to develop amendments necessary to Cal\OSHA regulations to establish 

more objective criteria for determining whether a specific VDECS installation 

presents an unsafe condition. 

10. Cost of VDECS 

Comment: Staff has also conceded that the cost of the devices is higher than 

they originally estimated, (CIAQC pointed this out repeatedly since the early 

development stages of the rule) and many manufacturers have chosen to 

abandon the off-road market. (Something CIAQC also predicted would happen 

when manufacturers realized how small and difficult the market would be to 

serve.) Staff has provided no evidence for their contention that the cost of 

devices will be lower in the future. In fact, fewer manufacturers with fewer options 

would dictate that costs would in fact be higher, not lower. (CIAQC1) 

Comment: CIAQC supports the proposed changes in the regulation but 

question whether or not they will achieve any significant result due to conditions 

that will prevent contractors from taking advantage of the extended deadline for 

double credit. Those factors include...the higher than anticipated costs of the 

devices...These issues coupled with the dramatic downturn in the economy and 
-36- 

the devastating impact it has had on the construction industry make it nearly 

impossible for contractors to comply with the regulation by 2010. (CIAQC1)

Comment: You folks have been touting this showcase. It's been two years in the 

making with $4.9 million and a fleet of 202 machines and you've done nine 

retrofits so far. 

We have a fleet that will require us to do 53 DPFs in the first year without double 

credit. And we don't have a budget of $4.9 million, nor do we have a staff of 

thousands to get this done. 

This should speak volumes about this 20 percent annual requirement under 

BACT. This rule for our company without that double credit will require us to 

spend $1.18 million on DPF in the first year, and that does not include the NOx 

part of the rule. 

Starting with the verified DPFs to date, they've added DPF conditionally verified 

units in the last 18 months for a very limited number of rubber off-road 

equipment. Staff is reporting the costs are 30 percent higher than they were 

estimated to be. 

I want to remind everyone this is a 21-year rule. Yet, as stated in July 2007, 50 

percent of the cost of this rule will be incurred by those large fleets within the first 

three years of this rule. It's doubtful to me these future low cost DPFs are going 

to be much good to fleets when most of the costs come up front. (DOWNS) 

Comment: I just wanted to address a couple of the challenges that industry is 

finding and experiencing with the VDECS. These are that the VDECS are more 

costly than originally promised. 

The cost of the retrofit is proving to be more expensive than anticipated. We 

heard today 30 percent more. We haven't heard or seen anything that would lead 

us to believe that those prices are going to decrease-- but will likely increase -- 

over time. 

We don't see the evidence for a decrease in costs, and we also note that the staff 

report indicates that some of the manufacturers are limiting the resources that 

they are providing for off-road VDECS or verification and focusing instead of onroad systems. So that doesn't look too promising from this perspective. 

(CIAQC3) 

Agency Response: Staff acknowledges that VDECS costs have been higher 

than initially estimated in the staff report for the original regulation. However, as 

stated in the staff report for the January amendments, staff’s initial cost analysis 

was based on estimates of the average prices for VDECS over the entire course 

of the regulation. Staff expects the volume of sales, as well as the increased 
-37- 

number of VDECS options fleets may choose from, to lower overall retrofits costs 

in the coming years. Additionally, the AB8 2X amendments will postpone the 

VDECS installation requirements for many fleets, allowing more devices to 

become verified, and for the prices of those devices to decrease. 

Although the commenters above are concerned that many retrofit manufacturers 

are leaving the off-road market, there are still many companies supplying off-road 

devices pursuing verification, and staff does not believe that there will be a lack 

of off-road retrofit manufacturers, or off-road retrofits, in the future. 

11. Cannot Afford the Regulation 

Comment: I am a contractor with approximately 30 Diesel Engines in my spread 

of equipment. My equipment ranges in HP from less than 10 HP to 100 HP. It 

also ranges in age from 1972 to 2006. The majority is within 15 years old. A 

majority of the equipment is on stand-by for when I may have a need for it. Many 

pieces only work 300 to 400 hours a year. This represents approximately 2 

months out of a year. 

I have been working the past 35 years to get to the point that most of my 

equipment is paid for and now I am being told that I must Retro-fit my equipment 

to meet or exceed the ARB (and Federal) Regulations. It would cost me MANY 

years PROFITS to retro-fit all my equipment. (KEY)

Comment: It should not require the "Small Business Owners" to go out of 

business to comply with the regulations. (KEY) 

Comment: As a small excavation and trucking contractor, we will be heavily 

impacted by these regulations. The capital investment required to meet those 

regulations, within the time frames outlined, cannot be supported by most 

companies. Only the large multi-state or multi-national companies will be able to 

survive. They will be able to accomplish compliance, only by shipping their older 

trucks and equipment to other states to work, replacing this equipment with new 

in California. Smaller contractors will not have the ability of having their older 

equipment support their new equipment as we have in the past. This will create 

a large competitive advantage for the very large contractors, putting most smaller 

contractors out of business. 

We have been in business for 20 years, and by best calculations, we would have 

to put 100% of our net profits into retrofitting or replacing our equipment for the 

next 20 years to become compliant. The regulations, as proposed, will require us 

to be compliant in less than 7 years. How can we be expected to remain in 

business when our rates would need to triple in order to pay off the capital 

investment that would be required, while the very large contractors will be mostly 

replacing their equipment as usual, moving old pieces out of state. Companies 
-38- 

such as ours require our older equipment to support the new pieces we 

purchase, it is the only way we can compete and survive. (WIPF) 

Comment: I have owned my own construction business in San Diego County for 

30 years and am now facing some of the most difficult economic times that I can 

remember. ALL of my off-road equipment is Tier One and I am faced with 

phasing out my Backhoes long before their useful life is over. Though I am a 

Small Fleet and my compliance dates are more lenient than others, it will be 

difficult if not impossible to meet the guidelines and still be able to afford to be in 

business. (COLLINS) 

Agency Response: As discussed in Chapter III.A.3 of the FSOR for the original 

regulation, staff recognizes that compliance with the regulation may be financially 

challenging for owners of regulated vehicles. Many fleets may have to change 

how they allocate capital resources, and they may need to borrow money to 

purchase retrofits and repowers, or to upgrade their vehicles. 

However, the regulation contains many provisions that provide fleets with 

compliance flexibility. It includes options such as NOx or PM retrofitting and 

repowering that can help fleets avoid the costs of replacing vehicles. Also, it 

gives credit for early repowers, turnovers and retrofits to reward early actions and 

help fleets spread out their compliance costs and avoid spikes in compliance 

costs in early years. The early credit provisions, including those provided by the 

AB 8 2X amendments, include: 

• Double credit for any PM exhaust retrofits installed before January 1, 2010 

for large fleets, and March 1, 2012 for medium and small fleets; 

• Single credit for any repower (to at least a Tier 1 engine) that was 

performed at any time before March 1, 2009, as long as that repowered 

vehicle is still in operation in the fleet; 

• Credit for retirement/replacement of Tier 0 vehicles in excess of 8 percent 

per year on average between March 1, 2006 and March 1, 2009; and 

• PM and NOx credit if a fleet can show reduced fleet activity July 1, 2007 

and March 1, 2010, or, if they have reduced their total fleet horsepower 

between March 1, 2006 and March 1, 2010. 

Because a fleet has numerous options for complying with the regulation, the 

costs of compliance for every fleet will vary. In addition, early credit and 

financing options are also available to spread costs in the early years for fleets. 

Also, the regulation does have more a more relaxed timeline and requirements 

for small fleets; allowing them more time to access incentive funds, financing, 

and double credit for early VDECS installations. 

 

Staff would like to note that commenter COLLINS may not fully understand the 

requirements for small fleets. COLLINS stated that they are faced with phasing 

out all of their backhoes long before their useful life is over. However, a small 
-39- 

fleet (one with 2,500 horsepower or less) is never required to phase out their 

equipment; only the installation of VDECS is required, and that requirement does 

not begin to phase in until 2015. 

For more responses to the affordability or cost of the regulation, please see 

Chapter III.A.3 of the FSOR for the original regulation. 

12. Re-do the Economic Analysis 

Comment: ARB needs to reassess the economic impacts of the rule, the current 

state of the industry especially with regard to the California and national 

economic conditions. An independent economic evaluation should be done of the 

overall cost of the rule to the industry. ARB’s lack of skill in economic analysis is 

the subject of academic and legal criticism throughout the nation. Staff’s original 

assumptions and cost savings have not been realized and the cost of the rule 

has increased significantly at a time when the industry simply cannot afford it. 

(CIAQC1) 

Agency Response: As stated in Chapter III.A.3 of the FSOR for the original 

regulation, staff did not solicit an independent economic evaluation of staff’s 

economic analysis because our methodology was fundamentally sound and our 

results reasonable and accurate. Also, as discussed in section a)i)1) of that 

Chapter, certain stakeholders did solicit such an analysis and it was supportive of 

staff’s conclusions. 

Additionally, with the addition of the adoption of the AB8 2X amendments in July 

2009, many fleets will be able to postpone their compliance requirements. 

Therefore, staff believes that many fleets will not have to take any actions to 

comply with the regulation for at least a year or two. Because of this, staff does 

not believe another economic assessment of the rule is necessary, due to fact 

that many fleets no longer have regulatory requirements in the beginning years of 

the regulation. 

For a more details on the AB8 2X amendments, please see the response in 

Section 5 above. 

13. Regulation Will Affect the Economy 

Comment: This overwhelming burden to repower, retrofit or replace equipment 

will only further diminish those much needed tax revenues by the state to meet 

budgetary requirements. (MCDONALD1)(MCDONALD2) 

Comment: This state is in a financial crisis and needs to protect potential 

revenues. While it is an undeniable fact that the air quality of California is a great 

concern for everyone, we must also balance this concern with what is financially 
-40- 

feasible at this time of economic crisis. Cleaning the air and saving lives is the 

goal, bankrupting the state and employers is not. If we are to survive this 

economic downturn we must all make concessions and that includes those at the 

regulatory level. (MCDONALD1)(MCDONALD2) 

Agency Response: Staff acknowledges the current recession; however, due to 

the AB8 2X amendments to the regulation adopted in July 2009, staff does not 

believe further modifications to the regulation are necessary at this time but is 

continuing to review the issue. The AB8 2X amendments should provide several 

years of relief to fleets that must comply with the regulation in its early years of 

implementation and should offset the potential economic impacts associated with 

complying with the regulation. For more details on the AB8 2X amendments, 

please see the response in Section 5 above. 

14. Cannot Pass on Costs 

Comment: In the early stages of the regulations development, staff argued that 

employers would cover the costs of compliance to the regulation through 

increases in revenues from competitive bidding, ongoing housing development, 

business growth and increased infrastructure needs.

As we enter 2009 these projections by staff have not come to pass. In fact with 

construction and housing starts in a tremendous downturn and banks unwilling or 

unable to extend credit, it becomes increasingly more difficult for employers to 

meet payroll let alone come up with the tens of thousands of dollars required to 

meet the requirements set forth by the regulation. 

(MCDONALD1)(MCDONALD2) 

Comment: Compared to a "normal" year our present construction volume has 

declined by 42%. We now see anywhere from 10 to 15 bidders on public projects 

where ordinarily there are 4 to 5 bidders. With such a competitive market it is 

impossible to pass on any higher cost. Like most California contractor's we are 

struggling to survive this serious downturn. (VCMI)

Agency Response: Staff acknowledges that due to the recession, there may be 

greater competition for construction projects that may prevent some fleets from 

passing on the costs of the regulation to their customers. However, for those that 

cannot absorb or pass on the costs of the regulation, the AB8 2X amendments 

will postpone and/or spread out the fleet’s initial compliance requirements over a 

number of years. 

For a more details on the AB 8 2X amendments, please see the response in 

Section 5 above. 
-41- 

15. Fleets are Downsizing 

Comment: Most companies are in survival mode as they down size and lay off 

employees just to keep their balance sheets from going into the red. 

(MCDONALD1)(MCDONALD2) 

Agency Response: Staff acknowledges that some companies may have to 

downsize their workforce and sell off portions of their fleets to survive this 

economic recession. However, with the adoption of the AB 8 2X amendments, 

fleets that have had to reduce the amount that they operate their vehicles (by 

reducing operator hours, for example) and/or decrease their total fleet 

horsepower (by selling and not replacing off-road vehicles) will be able to earn 

both PM and NOx credits, thereby deferring their compliance requirements 

further into the future. 

For a more details on the AB 8 2X amendments, please see the response in 

Section 5 above. 

16. Tier 4 Engines Are Not Available 

Comment: The Construction & Mining Industry has been preparing for the 

implementation of the regulation as set forth in the rule. However, discussion with 

the suppliers of ORD equipment and DPFs have revealed some implementation 

problems. 

One assumption that CARB made was that Tier 4 engines would be available by 

2011. For the large horsepower equipment widely used in the industry (>200 

horsepower), equipment manufacturers are indicating that it is more likely that 

Tier 4 engines will not be available until 2015 or 2016. Tier 4 engines are 

expected to have lower emission rates than a Tier 3 engine controlled with the 

highest level DPF. This delayed availability will make compliance difficult, if not 

impossible, for this industry. (KNAPP) 

Agency Response: Staff is not sure where commenter KNAPP read that final 

Tier 4 engines would be available in 2011, but believes that the technology to 

comply with the regulation does exist. Tier 4 interim engines will be available in 

2011, and that for most horsepower groups, these engines will have OEM filters, 

and have PM emissions equivalent to the Tier 4 final engines expected in the 

2015 timeframe. Since most Tier 4 interim engines will have the same PM 

emission factors as Tier 4 final engines, they too will have lower PM emission 

rates than a Tier 3 engine controlled with the highest level DPF. Additionally, the 

regulation contains section 2449(e)(9), which states that if there is a delay in 

availability of vehicles with engines meeting the Tier 3 or Tier 4 interim or final 

emission standards, the Executive Office may issue extensions to fleets that 

need these vehicles to comply with the regulation. Therefore, if the Tier 4 interim 
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or final technology does not become available when expected, fleets will not find 

it impossible to comply with the regulation. 

17. Analyze the Impacts of Multiple Regulations 

Comment: Staff must also consider that this is not the only ARB regulation that 

employers are required to comply with. Most of these employers also must 

comply with the PERP, ATCM, and the upcoming On-Road Rule. 

Employers that have the burden of meeting three or more regulations 

simultaneously will find it difficult at best to become fully compliant. I believe we 

should look at the bigger picture when considering the compliance strategy for 

these employers. The goal is to reduce emissions and therefore the overall 

reduction of the combined diesel fleet (PERP, ATCM, Off-Road and On-Road) 

should be an additional path to compliance. There must be a point to which 

everyone affected by the multitude of regulations and the quality of our air can 

find acceptance and practical applicability with all of our endeavors. 

(MCDONALD1)(MCDONALD2) 

Agency Response: As stated in the FSOR for the original regulation, staff is 

aware that many fleets will be subject to other regulations, such as the portable 

equipment Air Toxics Control Measure (ATCM), the off-road regulation, and the 

Statewide Truck and Bus Regulation (on-road regulation). For fleets subject to 

the off-road regulation, we do not expect that the portable equipment ATCM 

would add significant costs. Although staff does not have adequate survey data 

from fleets to know how much portable equipment is owned by fleets also 

affected by the off-road regulation, as stated in the Staff Report for the portable 

equipment ATCM, the total overall cost of the portable equipment ATCM for all 

fleets (both those subject to the off-road regulation and those not subject to it) is 

expected to be $15 million per year. As stated in the original off-road Staff 

Report, the annual cost of the off-road regulation is approximately $243 million 

per year, on average. Thus, even if all portable equipment covered by the 

portable equipment ATCM were owned by fleets also affected by the off-road 

regulation (which is not the case), the cumulative costs from the portable ATCM 

would not add significantly to the overall costs faced by off-road fleets. 

When the off-road regulation was initially adopted, the on-road regulation was 

still in development, and therefore, at that time, a cumulative cost analysis 

including the on-road regulation could not be done. However, when the on-road 

regulation was adopted in December 2008, a cumulative cost analysis was 

performed and presented in the staff report and TSD for the on-road regulation. 

The Board considered this cumulative impact when approving the on-road 

regulation. Additionally, with the addition of the AB 8 2X changes to the off-road 

regulation, compliance costs for large construction fleets will be significantly 

reduced over the next several years. For more details on these amendments, 

please see the response to Section 5 above. 
-43- 

For construction fleets that are considered medium or small fleets under the offroad regulation, off-road compliance requirements do not begin until 2013 or 

2015, respectively. Therefore, for both medium and small off-road fleets, the 

compliance requirements for the off-road and on-road regulation may not 

overlap. Also, small off-road fleets are only required to retrofit their off-road 

vehicles (no replacement/retirement necessary), resulting in off-road compliance 

costs much lower than those of medium and large fleets. Overall, as stated in 

Chapter XIV of the TSD for the on-road regulation, staff evaluated the potential 

cumulative costs of the on-road regulation for small fleets, and concluded that the 

on-road regulation will not impose any significant over lapping costs on small 

fleets. Also, many fleets will need to begin retrofitting or upgrading their on-road 

trucks before the compliance requirements for the off-road regulation come into 

effect, which will result in little overlapping compliance requirements. 

18. Alternatives to the Regulation 

Comment: We would propose a plan to build more mass transit, give people tax 

credits for utilizing mass transit, removing maybe 10 to 25% of the cars off the 

road. This would yield a 7.4 to 18.5 percent net benefit in greenhouse gas 

emissions. This plan would also generate construction jobs in our sagging state 

economy, injecting capital helping us to update our fleets. 

Why don’t we attack our greenhouse gases from another angle, and allow our 

trucks and equipment to cycle out as age and wear require their replacement as 

it was done with passenger vehicles. (WIPF) 

Agency Response: As stated in the FSOR for the original regulation, ARB’s 

mission is to promote and protect public health, welfare and ecological resources 

through regulations that effectively and efficiently reduce air pollutants where 

ARB has the regulatory authority to do so. Under state law, ARB has been 

directed by the Legislature to adopt airborne toxic control measures to address 

health risks posed by toxic air contaminants, including diesel particulate matter 

(PM), which has been identified as a known carcinogen (Health and Safety Code 

(H&SC) §§ 39650 et seq.). It has also been mandated to adopt as expeditiously 

as practicable, regulations to control, among other things, NOx and PM emission 

controls for off-road vehicles and equipment (H&SC §§ 43013(b) and 43018). 

The commenter’s proposal to build more mass transit is outside the scope of 

ARB’s regulatory authority. 

For more detailed information on why the off-road regulation is necessary, please 

see the responses in Chapter III.A.18 of the FSOR for the original regulation. 

Comment: Turnover of heavy duty trucks, buses and equipment will NOT be 

rapid enough to attain the 2020 emissions goals. Conversion of existing in-use 
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engines is the only practical way to attain this goal. Please level the playing field 

for Natural Gas conversion technology. (REED) 

Agency Response: Staff disagrees. As stated in the staff report for the original 

regulation, the off-road regulation is a necessary and integral part of California’s 

State Implementation Plan (SIP), and Diesel Risk Reduction Plan (DDRP) to 

reduce pollution throughout California. This regulation in combination with 

several other ARB regulations (such as the on-road regulation adopted in 

December 2008), will help to lower pollution levels significantly by 2020. 

Additionally, the off-road regulation does allow the conversion of diesel off-road 

vehicles to natural gas as one of many viable compliance options. 

19. Labeling Amendment 

Commenter: Quinn Group, Inc., a Caterpillar equipment distributor in California, 

respectfully requests an additional administrative amendment be added to the 

proposed changes for the off-road regulation to allow flexibility for rental and 

leasing companies to comply with installation of EINs for equipment presently out 

on rent or lease. 

Currently, Section 2449(f)(2) of the regulation requires Equipment Identification 

Numbers (EIN) to be installed on vehicles within 30 days of receipt of the ARBissued EIN. For reasons noted below, this requirement will be overly 

burdensome and virtually an impossible task for our large rental fleet of nearly 

1,500 vehicles: 

Many of our vehicles are out on rent or lease, and most at undisclosed locations. 

These machines, that are typically picked up at our facilities by our customers or 

delivered by hauler to a customer’s place of business or jobsite, are often 

subsequently moved by the customer to an undisclosed location. In some cases 

the machines are moved multiple times during the rentals. This hampers our 

ability to locate the vehicles and install the EINs. 

Machines out on rent can be anywhere in the State. We do not have the 

resources to feasibly contact all our customers and arrange for a machine to be 

available, and to install the EINs on all our machines out on rent within the 30-

day period. 

A machine out on rent or lease is under operational control of the lessee. Pulling 

a machine out of operation from the lessee introduces several consequences: 

• it disrupts a customer’s ability to perform the work they have been hired to 

accomplish, 

• it leaves their hired operator idle while the EIN is being installed, 
-45- 

• it puts us in conflict with the terms of our rental agreement putting us in a 

position of providing a payment concession to compensate for the down 

time, 

In order to avoid a disruption to the lessee’s operation, it will require our company 

to schedule the EIN installation after-hours, thereby increasing our costs and also 

creating a burden for the renter to provide after-hours access to their property. 

Our technicians are currently backlogged with production and maintenance 

repairs on our customer’s machines. Scheduling them for installation of these 

EINs in the field on our own rental machines removes them from providing the 

services we are required to perform for our customers as a distributor under our 

contract with Caterpillar, Inc. 

Costs to perform the installations of the EINs while the machines are off rent and 

in our possession will be far less than those we will incur for installing the EINs in 

the field. These costs were not addressed in the Initial Statement of Reasons. 

While we will do our best to follow Staff’s recommendation to report early to get 

EINs assigned and installed in advance, with the large number of machines, 

even early reporting will not ensure we have the proper amount of time to locate 

all our machines in time, and install the EINs economically and without disruption 

to the renters. Additionally, even now we are still collecting engine data from 

non-Caterpillar vendors making it difficult to provide accurate data for early 

reporting. 

Therefore, I would like to recommend the following administrative change be 

made to the regulatory language to allow flexibility for rental and leasing 

companies: 

“2449(f)(3) Installation of Equipment Identification Numbers for Rental Fleets and 

Leasing Companies – Owners of rental fleets and owners with vehicles out on 

lease shall permanently affix or paint the EIN(s) on the vehicle as per 2449(f)(2) 

in accordance with the following schedule for all vehicles reported prior to the 

initial reporting date: 

Within 30 days of receipt of the ARB-issued EIN for all machines not out on rent 

or lease; 

If a machine is out on rent or lease, within 20 days of the vehicle being returned 

to the rental/lease yard; 

For all rental or leased vehicles, no later than December 31, 2009. 

All other rental or leased vehicles added to the fleet subsequent to initial 

reporting shall follow requirements of 2449(f)(1) and (f)(2). 
-46- 

Rental and leasing companies shall specify at the time of initial reporting their 

intention to follow this schedule. Evidence must be provided demonstrating the 

company operates as a rental or leasing company.” 

On behalf of Quinn Group, Inc., and the other Caterpillar dealers operating in the 

State of California, I appreciate your consideration of this administrative request. 

We feel this request does not affect emissions reductions and it affords the 

owners of these vehicles an economical and flexible solution for complying with 

the initial EIN installation. (QUINN) 

Comment: The American Rental Association represents several hundred 

equipment rental businesses in California. Section 2449(f)(2) of the referenced 

regulation details when equipment identification numbers (EINs) must be affixed 

on vehicles. For the initial report, Staff has interpreted this section to mean that 

EINs must be affixed within 30 days after the initial reporting date of the fleet. 

The fleets with the largest amount of equipment, large fleets, must meet this 

requirement at the earliest date, April 1, 2009. A number of ARA member rental 

companies may have difficulty meeting this requirement because of the large 

number of units in their fleets. 

Our members are diligently collecting data and preparing their initial reports. No 

members have asked for an extension to the initial reporting date. However, 

there may be difficulty affixing EINs to equipment rented and in the field since 

that equipment is not always easily accessible to the firm that owns it. 

According to the rule, there are no emission benefits gained by the regulation in 

2009. The first large fleet compliance date is March 1, 2010. Thus, there is no 

air quality benefit to be gained via enforcement during 2009 that results from 

affixing EINs. 

We ask the Board to consider extending the time period for affixing EINs to the 

end of Calendar 2009 so as to not create a hardship on rental companies that 

have limited access to their fleet vehicles. (MCCLELLAND) 

Agency Response: Staff does not believe that this change to the regulation is 

necessary; a fleet has 30 days to affix its EIN labels if they report on its required 

reporting deadline. If a fleet reported before its reporting deadline, the fleet was 

not required to have its vehicles labeled until 30 days after its reporting deadline. 

Therefore, if a fleet reported early (i.e., before their reporting deadline), staff gave 

those fleets additional time to label their vehicles. 

For example, the large fleet reporting deadline was April 1, 2009. If a large fleet 

reported on that date, it would have had only 30 days to affix its EINs. However, 

if a fleet reported any time before April 1, 2009, it would have had until April 30, 

2009 (30 days after the reporting deadline for large fleets) to affix its EINs. 
-47- 

The Diesel Off-road Online Reporting System (DOORS), the reporting tool for the 

regulation, became active online and able to accept fleet reporting information 

beginning in late June 2008. Therefore, if a large fleet reported in late summer 

2008, they would have had approximately 10 months to label its reported 

vehicles. Many large fleets with hundreds of vehicles spent numerous hours 

reporting early, and were able to report and label their vehicles through DOORS 

during the end of 2008 and the beginning of 2009. Therefore, since many large 

fleets spent a significant amount of effort to report and label their vehicles early, 

staff believes that it would not be fair to those large fleets if additional time was 

given to some large rental fleets, but not all larger fleets. 

Staff also believes it is appropriate to keep the reporting and labeling deadlines 

of the regulation as scheduled, and that they should not be postponed until 

December 2009. Although both commenters believe that it is not necessary to 

have all vehicles labeled and reported before the end of 2009, staff disagrees, 

and believes that is the current provisions are necessary so that the enforcement 

of the reporting and labeling requirements may begin during the fall of 2009. If 

not all fleets are reported and labeled, it will be difficult for ARB to enforce these 

provisions, since it may be difficult and time consuming to distinguish between 

rental and non-rental vehicles. 

Staff would also like to note that both commenters above were active participants 

during the development of the off-road regulation, and have known for many 

years that the regulation would require the reporting and labeling of their fleets. 

Therefore, ample time has been given to these large fleets to report and label 

their vehicles before the labeling deadline occurred. 

Also, when estimating the costs of compliance for the off-road regulation, staff 

did assume that reporting and labeling vehicles would result in some costs to the 

affected fleets. However, these costs were expected to be minimal, and could be 

reduced if spread out over a larger amount of time. As stated above, staff 

believes that these fleets have had ample time to report their vehicles; time which 

could have been used to reduce the resources necessary to locate and report 

each rental vehicle. 

20. Captive Attainment Area Fleet Extension 

Comment: We appreciate ARB staff’s efforts to understand and address the 

issues that have arisen during the implementation of the Off-Road Rule and 

would like to express our support of the proposed amendments. 

However, many fleet owners will still have financial distress complying with the 

proposed regulation, especially in rural areas. We ask the Board again consider 

extending the “Captive Attainment Area Fleet” to those rural counties that are 

classified as nonattainment for National Ambient Air Quality Standards (NAAQS) 

for ozone and particulate matter (PM) 2.5 strictly due to transport. 
-48- 

The regulation currently exempts fleets located in ozone and PM2.5 attainment 

areas from the NOx requirements, if the vehicles are used in only attainment 

areas. Private fleets in a number of our rural counties will benefit from this 

provision. Meeting NOx reductions is a considerable financial impact to fleets, 

which will have a disproportionate negative economic impact in our rural 

counties. RCRC would ask ARB to reconsider that those counties in 

nonattainment strictly due to intrastate transport of air pollution also be exempt, 

(i.e., western Nevada, Amador, Calaveras, Tuolumne, Mariposa). Emissions 

reductions from the contributing upwind districts will lead to the downwind area 

attainment. (RCRC1) 

Comment: We recognize that the proposed amendments do not address our 

comment, but I simply would like to state that we would still like to see the NOx 

exemption for the captive attainment area fleets extended to those rural counties 

who are non-attainment strictly due to transport. (RCRC2) 

Agency Response: As stated in the FSOR for the original regulation, staff 

disagrees with extending the “Captive Attainment Area Fleet” definition to include 

areas that are classified as non-attainment as a result of transport. These areas 

have been designated by the U.S. EPA as violating the federal 8-hour ozone 

standard, and the air quality in some of these areas is degrading, potentially 

warranting a future redesignation as severe non-attainment for the federal ozone 

standard. Local NOx contributions add to the severity of the ozone problem, and 

therefore, staff believes that actions must be taken within these areas to meet 

this standard, and at the regulation will provide important emission reductions 

towards that end. 

For a more detailed response to the economic impacts of the regulation, please 

see the response to Section 5 above.