Approval and Promulgation of Implementation Plans; State of Texas; Control of Air 

Pollution from Motor Vehicles 

Technical Support Document 

Introduction 

 This technical support document (TSD) evaluates four Texas State Implementation Plan 

(SIP) revisions submitted on: 

• May 15, 2006; 

• October 10, 2006; 

• January 17, 2008; and 

• February 28, 2008 

The May 15, 2006 submittal amends the Locally Enforced Motor Vehicle Idling Limits. 

The October 10, 2006 submittal establishes the Texas Clean School Bus Program, amends the 

Texas Emissions Reduction Plan (TERP), and establishes a Rebate Grant Program as part of the 

TERP. The January 17, 2008 submittal further amends the TERP and, in some subsections, 

supersedes the amendments found in the October 10, 2006 submittal. The February 28, 2008 

submittal further amends the Locally Enforced Motor Vehicle Idling Limitations and, in some 

subsections, supersedes the revisions submitted on May 15, 2006. We see no value in acting on 

a revision that has been subsequently superseded and have clearly marked these subsections in 

the table below. 

 This TSD presents the legal and technical elements of these four submittals. It includes a 

table of the revisions with numbering and titles, legal and technical comments, and differences 

between the current and proposed revisions. 

Legal Authority

 The Texas Commission on Environmental Quality (TCEQ) is a State environmental 

agency. Under the Texas Health and Safety Code, §§382.011, 382.012 and 382.023, the TCEQ 

has the authority to control the quality of the State’s air and to issue orders consistent with the 

policies and purposes of the Texas Clean Air Act, Chapter 382 of the Texas Health and Safety 

Code. Notice of a public hearing for the proposed revisions submitted on May 15, 2006, was 

published in the December 16, 2005 issue of the Texas Register (30 TexReg 8473). On April 26, 

2006, TCEQ adopted these revisions to the SIP concerning Locally Enforced Motor Vehicle 

Idling Limitations. Notice of a public hearing for the proposed SIP revisions submitted on 

October 10, 2006, was published in the April 14, 2006 issue of the Texas Register (31 TexReg 

3287). On September 20, 2006, TCEQ adopted these revisions to the SIP concerning the Texas 

Clean School Bus Program, revisions to the TERP, and the Rebate Grant Program. Notice of 

public hearings for the proposed SIP revisions submitted on January 17, 2008, were published in 

the August 24, 2007 issue of the Texas Register (32 TexReg 5491). On December 5, 2007, 

TCEQ adopted these revisions to the SIP concerning amendments to the TERP. Notice of a 

public hearing for the proposed SIP revisions submitted on February 28, 2008, was published in 

the October 5, 2007 issue of the Texas Register (32 TexReg 7118). On January 30, 2008, TCEQ 

adopted these revisions to the SIP concerning Locally Enforced Motor Vehicle Idling 
2

Limitations. The State has the necessary legal authority under State law to adopt and implement 

these revisions. 

Technical Review

The revisions contained within the four submittals pertain to Texas Administrative Code 

(TAC) title 30, which applies to Environmental Quality. To evaluate these SIP submittals, the 

following factors have been considered: 

A). Differences between the current and revised sections were analyzed, including legal 

and technical comments, and numbering and title changes; these differences are presented 

in the table below; and 

B). EPA Guidance: Improving Air Quality with Economic Incentive Programs was used 

to evaluate the revisions to the TERP. In 2005, the TERP was approved into the SIP as 

an Economic Incentive Program (EIP). Please see 70 FR 48647, August 19, 2005. With 

the submitted revisions to the TERP, this program continues to adhere to EPA’s EIP 

guidance. See review and analysis below. 

 The submitted revisions clarify the SIP requirements. Therefore, EPA recommends 

approving those portions of the SIP revisions submitted on May 15, 2006 and October 10, 2006 

that have not been superseded, as well as the SIP revisions submitted on January 17, 2008 and 

February 28, 2008 as a Direct Final rule. EPA is approving these revisions pursuant to section 

110 of the Clean Air Act (CAA). 
3

Current SIP Citation 

Title/Subject

New or Revised Citation 

Title/Subject 

Source of Text Comments on Revision 

Texas Administrative Code, Title 30 (TAC 30) 

Texas Commission on Environmental Quality

Chapter 114 (TAC 30:114) Control of Air Pollution from Motor Vehicles 

Subchapter J. Operational Controls for Motor Vehicles 

Division 2. Locally Enforced Motor Vehicle Idling Limitations 

30:114.512 Control Requirements for Motor Vehicle Idling 

30:114.512 (a) Control Requirements for Motor Vehicle Idling 

N/A Adopted by TX, effective 5/17/2006. 

Submitted by TX to EPA on 5/15/2006. Names existing first paragraph as subsection (a). 

N

New Citation 30:114.512 (b) 

Control Requirements for Motor Vehicle Idling 

House Bill 1540, 79 Legislature, 2005 

th Adopted by TX, effective 5/17/2006. Submitted by TX to EPA on 5/15/2006. 

Establishes that no driver using the vehicle’s sleeper berth may idle the vehicle in a school 

zone or within 1,000 feet of a public school during its hours of operation, an offense of which may be punishable by a fine not to exceed $500. This subsection expires September 1, 2007. 

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Current SIP Citation 

Title/Subject

New or Revised Citation 

Title/Subject 

Source of Text Comments on Revision 

30:114.512(b) Control Requirements for Motor Vehicle Idling 

30:114.512 (b) Control Requirements for Motor Vehicle Idling 

Senate Bill 12, 80th Legislature, 

2007 

Adopted by TX, effective 2/21/2008. Submitted by TX to EPA on 2/28/2008. Added: Prohibits idling by drivers using the vehicle’s sleeper berth in residential areas as 

defined by Local Government Code, §244.001, or within 1,000 feet of a hospital. Revised: The expiration of this subsection is extended to September 1, 2009. 

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30:114.517(1) Exemptions 

30:114.517(1) Exemptions 

N/A Adopted by TX, effective 5/17/2006. 

Submitted by TX to EPA on 5/15/2006. Still provides an exemption from the control requirements for motor vehicle idling for a 

motor vehicle with a gross vehicle weight (GVW) rating of 14,000 pounds or less, but only if before September 1, 2007, the motor vehicle does not have a sleeper berth.1

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1 In a comment letter to TCEQ, dated January 17, 2006, EPA expressed concerns with the May 15, 2006 submittal regarding revisions t

Motor Vehicle Idling Limits. The EPA considered the revision to 114.517(1) to be a weakening of the SIP that was approved by EPA o18308). The EPA is not taking action on this revision because it has been superseded by a subsequent revision. 
5

Current SIP Citation 

Title/Subject

New or Revised Citation 

Title/Subject 

Source of Text Comments on Revision 

30:114.517 (1) Exemptions 

30:114.517 (1) Exemptions 

Senate Bill 12, 80th Legislature, 

2007 

Adopted by TX, effective 2/21/2008. Submitted by TX to EPA on 2/28/2008. Removes the expiration date and clarifies that motor vehicles with a GVW rating of 14,000 

pounds or less, and that do not have a sleeper berth, are exempt from the control requirements for motor vehicle idling. 

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New Citation 30:114.517 (2) 

Exemptions 

Senate Bill 12, 80th Legislature, 

2007 

Adopted by TX, effective 2/21/2008. Submitted by TX to EPA on 2/28/2008. Clarifies that after September 1, 2009, all motor vehicles with a GVW rating of 14,000 

pounds or less will be exempt from the control requirements for motor vehicle idling.2

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30:114.517 (2)-(11) Exemptions 

30:114.517 (3)-(12) Exemptions 

N/A Adopted by TX, effective 2/21/2008. 

Submitted by TX to EPA on 2/28/2008. Paragraphs (2)-(11) of this section are renumbered as paragraphs (3)-(12), for 

consistency. 

N

2 The EPA first approved revisions to the Texas SIP that incorporated Locally Enforced Motor Vehicle Idling Limits on April 11, 2005 

2005 rulemaking, the idling restrictions applied only to heavy duty vehicles with a GVW rating greater than 14,000 pounds. The idling intended to apply to motor vehicles with a GVW rating of 14,000 pounds or less, and the revisions in today’s rulemaking make that cleconsistency with the TX SIP revisions approved in 2005. 
6

Current SIP Citation 

Title/Subject

New or Revised Citation 

Title/Subject 

Source of Text Comments on Revision 

30:114.517 (4) Exemptions 

30:114.517 (4) Exemptions 

N/A Adopted by TX, effective 5/17/2006. 

Submitted by TX to EPA on 5/15/2006. The revised phrase now reads: the control requirements for motor vehicle idling do not 

apply to “the primary propulsion engine of a motor vehicle providing a power source necessary for mechanical operation, other than propulsion, and/or passenger compartment heating, or air conditioning.” 

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30:114.517 (7) Exemptions 

30:114.517 (7) Exemptions 

N/A Adopted by TX, effective 5/17/2006. 

Submitted by TX to EPA on 5/15/2006. The revised phrase now reads: the control requirements for motor vehicle idling do not 

apply to “the primary propulsion engine of a motor vehicle that is being used to supply heat or air conditioning necessary for passenger comfort and safety in vehicles intended for commercial or public passenger transportation, or passenger transit operations, in which case idling up to a maximum of 30 minutes is allowed.” 

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Current SIP Citation 

Title/Subject

New or Revised Citation 

Title/Subject 

Source of Text Comments on Revision 

30:114.517 (8) Exemptions 

30:114.517 (8) Exemptions 

N/A Adopted by TX, effective 5/17/2006. 

Submitted by TX to EPA on 5/15/2006. Exempts from the control requirements for motor vehicle idling, the primary propulsion 

engine of a motor vehicle being used to provide air conditioning or heating necessary for employee health or safety while the employee is using the vehicle to perform an essential job function related to roadway construction or maintenance. In addition, the exemption regarding the propulsion engine of motor vehicles used for passenger transit operations is removed from this paragraph and inserted into paragraph (7). 

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30:114.517 (9) Exemptions 

30:114.517 (9) Exemptions 

N/A Adopted by TX, effective 5/17/2006. 

Submitted by TX to EPA on 5/15/2006. Removes the word “or” at the end of the paragraph to indicate it is no longer the next 

to last subsection. 

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8

Current SIP Citation 

Title/Subject

New or Revised Citation 

Title/Subject 

Source of Text Comments on Revision 

30:114.517 (10) Exemptions 

30:114.517 (10) Exemptions 

N/A Adopted by TX, effective 5/17/2006. 

Submitted by TX to EPA on 5/15/2006. Replaces the word “who” with the word “that” for grammatical purposes; replaces a 

period with a semi-colon; and adds the word “or” at the end of the paragraph to indicate that a subsection has been added after this subsection. 

N

New Citation 30:114.517 (11) 

Exemptions 

House Bill 1540, 79 Legislature, 2005 

th

Adopted by TX, effective 5/17/2006. Submitted by TX to EPA on 5/15/2006. Exempts from the control requirements for motor vehicle idling, a motor vehicle when 

idling is necessary to power a heater or air conditioner while a driver is using the vehicle’s sleeper berth for a governmentmandated rest period, and establishes that this subsection expires September 1, 2007.3

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3 In a comment letter to TCEQ, dated January 17, 2006, EPA expressed concerns with the May 15, 2006 submittal regarding revisions t

Motor Vehicle Idling Limits. EPA considered the addition of the exemption found in 114.517 (11) to be a weakening of the SIP that wApril 11, 2005 (70 FR 18308). Since the expiration date of paragraph (11) was extended to September 1, 2009 by a superseding revisioaction on the revisions to paragraph (11) because the expiration date of September 1, 2009 has already passed, and paragraph (11) is the
9

Current SIP Citation 

Title/Subject

New or Revised Citation 

Title/Subject 

Source of Text Comments on Revision 

30:114.517 (11) Exemptions 

30:114.517 (12) Exemptions 

Senate Bill 12, 80th Legislature, 

2007 

Adopted by TX, effective 2/21/2008. Submitted by TX to EPA on 2/28/2008. Added: Continues to exempt motor vehicles when idling is necessary to power a heater or 

air conditioner while a driver is using the vehicle’s sleeper berth for a government mandated rest period, but only when the motor vehicle is not within two miles of a facility offering external heating and air conditioning connections at a time when those connections are available. Revised: The expiration of this subsection is extended to September 1, 2009. 

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Chapter 114 (TAC 30:114) Control of Air Pollution from Motor Vehicles 

Subchapter K. Mobile Source Incentive Programs

Division 3. Diesel Emissions Reduction Incentive Program for On-Road and Non-Road Vehicles 
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Current SIP Citation 

Title/Subject

New or Revised Citation 

Title/Subject 

Source of Text Comments on Revision 

30:114.620 (1) Cost-effectiveness 

30:114.620 (1) Cost-effectiveness 

Senate Bill 5, 77th Legislature, 

2001 

Adopted by TX, effective 10/12/2006. Submitted by TX to EPA on 10/10/2006. Establishes that in calculating costeffectiveness, one-time grants of money at the 

beginning of a project shall be annualized using a time value of public funds or discount rate determined for each project by the TCEQ, taking into account the interest rate on bonds, interest earned by State funds, and other factors the TCEQ considers appropriate. 

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30:114.620 (8) Qualifying fuel 

30:114.620 (8) Qualifying fuel 

30:114.620 (8) Adopted by TX, effective 10/12/2006. 

Submitted by TX to EPA on 10/10/2006. Changes “EPA” to “United States Environmental Protection Agency.” 

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30:114.620 (10) Retrofit 

30:114.620 (10) Retrofit 

30:114.620 (10) Adopted by TX, effective 10/12/2006. 

Submitted by TX to EPA on 10/10/2006. Changes “EPA” to “United States Environmental Protection Agency.” 

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11

Current SIP Citation 

Title/Subject

New or Revised Citation 

Title/Subject 

Source of Text Comments on Revision 

30:114.622(b) Incentive Program Requirements 

30:114.622 (b) Incentive Program Requirements 

Senate Bill 12, 80th Legislature, 

2007 

Adopted by TX, effective 1/6/2008. Submitted by TX to EPA on 1/17/2008. Allows the TCEQ to designate highways and roadways or portions of a highway or 

roadway on which travel by grant-funded vehicles may count towards the requirement that vehicles be operated at least 75 % of the annual miles in the nonattainment areas and affected counties. 

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Current SIP Citation 

Title/Subject

New or Revised Citation 

Title/Subject 

Source of Text Comments on Revision 

30:114.622 (c) Incentive Program Requirements 

30:114.622 (c) Incentive Program Requirements 

House Bill 2481, 79th Legislature, 

2005 

Adopted by TX, effective 10/12/2006. Submitted by TX to EPA on 10/10/2006. Establishes that under the TERP grant program, for a proposed project that includes 

a replacement or repower, the old equipment or engine must be recycled, scrapped, or otherwise permanently removed from the State, eliminating the requirement of removing the old equipment or engine only from the applicable counties listed in Section 114.629. 

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30:114.622 (c) Incentive Program Requirements 

30:114.622 (c) Incentive Program Requirements 

Senate Bill 12, 80th Legislature, 

2007 

Adopted by TX, effective 1/6/2008. Submitted by TX to EPA on 1/17/2008. Establishes that under the TERP grant program, for a proposed project that includes 

a replacement of equipment or a repower, the old equipment or engine must be either recycled or scrapped, provided however, that the executive director may allow permanent removal from the State in specific grants where the applicant has provided sufficient assurances that the old locomotive will not be returned to the State.4

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4 In the proposed rules published in the August 24, 2007 issue of the Texas Register (32 TexReg 5324), the option to permanently remo

engine from the State was completely eliminated. However, during the comment period, the State received written and oral testimony fGenesee & Wyoming Inc., BNSF Railway Company, Railpower Hybrid Technologies Corp., and Union Pacific Railroad Company, req

allowed to transfer or sell old equipment and engines to out-of-state users. This testimony can be found in the section titled “Written an

State’s submittal, which is in the docket for this rulemaking. Based on the comments received, in the adopted rules published in the Decthe Texas Register (32 TexReg 10010), revisions to section 114.622 (c) were adopted with a change from proposal. 
13

Current SIP Citation 

Title/Subject

New or Revised Citation 

Title/Subject 

Source of Text Comments on Revision 

30:114.622 (d) Incentive Program Requirements 

30:114.622 (d) Incentive Program Requirements 

Senate Bill 5, 77th Legislature, 

2001 

Adopted by TX, effective 10/12/2006. Submitted by TX to EPA on 10/10/2006. Establishes that eligible projects under TERP must not exceed a cost-effectiveness of 

$13,000 per ton of NOx emissions reduced. 

However, the TCEQ is allowed to set lower cost-effectiveness standards, to ensure the best use of available funds (this will allow spending a larger amount of money per ton of NOx reduced). In addition to cost 

effectiveness, the TCEQ is also allowed to base project selection decisions on other measures when evaluating the effectiveness of projects in reducing NOx emissions in 

relation to the funds to be awarded. 

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Current SIP Citation 

Title/Subject

New or Revised Citation 

Title/Subject 

Source of Text Comments on Revision 

30:114.622 (d) Incentive Program Requirements 

30:114.622 (d) Incentive Program Requirements 

Senate Bill 12, 80th Legislature, 

2007 

Adopted by TX, effective 1/6/2008. Submitted by TX to EPA on 1/17/2008. Raises the cap of the cost-effectiveness criteria for grant funded projects under the 

TERP from $13,000 per ton of NOx reduced 

to $15,000 per ton of NOx reduced. 

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New Citation 30:114.624 (a) 

Rebate Grant Process 

House Bill 2481, 79th Legislature, 

2005 

Adopted by TX, effective 10/12/2006. Submitted by TX to EPA on 10/10/2006. Establishes a streamlined process that awards TERP funds as rebate grants. 

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New Citation 30:114.624 (b) 

Rebate Grant Process 

House Bill 2481, 79th Legislature, 

2005 

Adopted by TX, effective 10/12/2006. Submitted by TX to EPA on 10/10/2006. Establishes that the Rebate Grant Process shall: designate certain types of projects 

eligible for rebates; project standardized NOx 

emissions reductions for each designated project type; assign a standardized rebate amount for each designated project type; allow for processing rebates on an ongoing first-come, first-served basis; and consolidate, simplify, and reduce the administrative work for applicants and the TCEQ associated with grant application, contracting, reimbursement, and reporting processes for designated project types. 

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Current SIP Citation 

Title/Subject

New or Revised Citation 

Title/Subject 

Source of Text Comments on Revision 

New Citation 30:114.624 (c) 

Rebate Grant Process 

House Bill 2481, 79th Legislature, 

2005 

Adopted by TX, effective 10/12/2006. Submitted by TX to EPA on 10/10/2006. Establishes that the TCEQ may: award rebate grants as a pilot project for a specific region 

or may award the grants statewide; limit or expand the designated project types as necessary to further the goals of the program; and administer the rebate grants or may designate another entity to administer the grants. 

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Division 4. Texas Clean School Bus Program (New) 

New Citation 30:114.640 (1)-(5) 

Definitions 

House Bill 3469, 79th Legislature, 

2005 

Adopted by TX, effective 10/12/2006. Submitted by TX to EPA on 10/10/2006. Provides definitions for terms in the Texas Clean School Bus Program: Diesel exhaust, Incremental Cost, Qualifying fuel, Repower, 

and Retrofit. 

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New Citation 30:114.642 (a) 

Applicability 

House Bill 3469, 79th Legislature, 

2005 

Adopted by TX, effective 10/12/2006. Submitted by TX to EPA on 10/10/2006. Establishes that any school district and charter school in the State, which operates 

one or more diesel-fueled school bus or a transportation system provided by a countywide school district, may apply for and receive a grant under the Texas Clean School Bus Program. 

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Current SIP Citation 

Title/Subject

New or Revised Citation 

Title/Subject 

Source of Text Comments on Revision 

New Citation 30:114.642 (b) 

Applicability 

House Bill 3469, 79th Legislature, 

2005 

Adopted by TX, effective 10/12/2006. Submitted by TX to EPA on 10/10/2006. Allows regional planning organizations, councils of governments, and private 

nonprofit organizations to apply for and receive grants under the Texas Clean School Bus Program. 

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New Citation 30:114.644 (a) 

Clean School Bus Program Requirements 

House Bill 3469, 79th Legislature, 

2005 

Adopted by TX, effective 10/12/2006. Submitted by TX to EPA on 10/10/2006. Establishes that the types of projects eligible for a Clean School Bus Program grant 

include: diesel oxidation catalysts for school buses built before 1994; diesel particulate filters for school buses built from 1994 to 1998; the purchase of and use of emissionreducing add-on equipment for school buses, including devices that reduce crankcase emissions; the use of qualifying fuel; and other technologies that the TCEQ finds will bring about significant emissions reductions. 

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Current SIP Citation 

Title/Subject

New or Revised Citation 

Title/Subject 

Source of Text Comments on Revision 

New Citation 30:114.644 (b) 

Clean School Bus Program Requirements 

House Bill 3469, 79th Legislature, 

2005 

Adopted by TX, effective 10/12/2006. Submitted by TX to EPA on 10/10/2006. Establishes the ability of the TCEQ to limit funding for a Clean School Bus Program 

grant under a particular funding round to certain areas of the State, types of applicants, and/or types of projects. In addition, the TCEQ is allowed to place a priority on funding for projects conducted in areas that do not attain certain National Ambient Air Quality Standards. 

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New Citation 30:114.644 (c) 

Clean School Bus Program Requirements 

House Bill 3469, 79th Legislature, 

2005 

Adopted by TX, effective 10/12/2006. Submitted by TX to EPA on 10/10/2006. Establishes that prior to each funding period for the Texas Clean School Bus Program, the TCEQ may establish priorities and other 

criteria for reductions in diesel exhaust emissions to be achieved by projects funded during that period; establishes that a proposed project must achieve a reduction in emissions of diesel exhaust compared with the baseline emissions according to the percentage reduction level and other priorities established by the TCEQ; and allows the TCEQ to establish maximum levels for the funding awarded in relation to the emission reductions projected to be achieved by a project, in order to maximize the use of available funds. 

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Current SIP Citation 

Title/Subject

New or Revised Citation 

Title/Subject 

Source of Text Comments on Revision 

New Citation 30:114.644 (d) 

Clean School Bus Program Requirements 

House Bill 3469, 79th Legislature, 

2005 

Adopted by TX, effective 10/12/2006. Submitted by TX to EPA on 10/10/2006. Establishes that a school bus proposed for retrofit must be used on a regular, daily route 

to and from a school and have at least five years of useful life remaining unless the applicant agrees to remove the retrofit device at the end of the life of the bus and reinstall the device on another bus. 

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New Citation 30:114.644 (e) 

Clean School Bus Program Requirements 

House Bill 3469, 79th Legislature, 

2005 

Adopted by TX, effective 10/12/2006. Submitted by TX to EPA on 10/10/2006. Establishes that for a proposed project that includes a replacement of equipment or a 

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

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New Citation 30:114.644 (f) 

Clean School Bus Program Requirements 

House Bill 3469, 79th Legislature, 

2005 

Adopted by TX, effective 10/12/2006. Submitted by TX to EPA on 10/10/2006. Establishes that an application for a grant under this program is only eligible if it is 

made on the form provided by the TCEQ and contains the information required by the TCEQ. 

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Current SIP Citation 

Title/Subject

New or Revised Citation 

Title/Subject 

Source of Text Comments on Revision 

New Citation 30:114.644 (g) 

Clean School Bus Program Requirements 

House Bill 3469, 79th Legislature, 

2005 

Adopted by TX, effective 10/12/2006. Submitted by TX to EPA on 10/10/2006. Establishes that a recipient of a grant under this division shall use the grant to pay 

incremental costs of the project for which the grant is made, which may include the reasonable and necessary expenses incurred for the labor needed to install emissionsreducing equipment. However, the recipient may not use the grant to pay the recipient’s administrative expenses. 

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New Citation 30:114.644 (h) 

Clean School Bus Program Requirements 

House Bill 3469, 79th Legislature, 

2005 

Adopted by TX, effective 10/12/2006. Submitted by TX to EPA on 10/10/2006. Clarifies that projects funded with a grant from this program may not be used for credit 

under any state or federal emissions reduction credit averaging, banking, or trading program except as provided under Texas Health and Safety Code, §386.056. 

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Title/Subject

New or Revised Citation 

Title/Subject 

Source of Text Comments on Revision 

New Citation 30:114.644 (i) 

Clean School Bus Program Requirements 

House Bill 3469, 79th Legislature, 

2005 

Adopted by TX, effective 10/12/2006. Submitted by TX to EPA on 10/10/2006. Clarifies that a proposed project is not eligible for this grant if it is required by any state or 

federal law, rule or regulation, memorandum of agreement, or other legally binding document. This subsection does not apply to an otherwise qualified project, regardless of the fact that the SIP assumes that the change in equipment, vehicles, or operations will occur, if on the date the grant is awarded the change is not required by any state or federal law, rule, or regulation, memorandum of agreement, or other legally binding document or the purchase of an on-road diesel or equipment required only by local law or regulation or by corporate or controlling board policy of a public or private entity. 

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Current SIP Citation 

New Citation 30:114.644 (j) 

Clean School Bus Program Requirements 

House Bill 3469, 79th Legislature, 

2005 

Adopted by TX, effective 10/12/2006. Submitted by TX to EPA on 10/10/2006. Clarifies that if a recipient of a Clean School Bus Program grant fails to meet the terms of a 

project grant or the conditions of this division, the executive director can require that the grant recipient return some or all of the grant funding to the extent that emissions reductions are not achieved or cannot be demonstrated. 

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Title/Subject

New or Revised Citation 

Title/Subject 

Source of Text Comments on Revision 

New Citation 30:114.646 

Monitoring, Recordkeeping, and Reporting Requirements 

House Bill 3469, 79th Legislature, 

2005 

Adopted by TX, effective 10/12/2006. Submitted by TX to EPA on 10/10/2006. Establishes that recipients of Clean School Bus Program grants must adhere to the 

reporting requirements of their grant, which will occur at least annually. 

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New Citation 30:114.648 S

Implementation Schedule 

House Bill 3469, 79th Legislature, 

2005 

Adopted by TX, effective 10/12/2006. Establishes that the Texas Clean School Bus Program will expire on August 31, 2013. 

Current SIP Citation 
22

Review and Analysis Concerning Adherence to EIP Guidance 

In this document, we are reviewing revisions to the TERP program. The revisions 

include amendments to Division 3, which concerns the Diesel Emissions Reduction Incentive 

Program for On-Road and Non-Road Vehicles. The Diesel Emission Reduction Incentive 

Program for On-Road and Non-Road Vehicles is found in Title 30 of the Texas Administrative 

Code (denoted 30 TAC), Chapter 114, Subchapter K, Division 3. Revisions also consist of new 

Division 4, which sets forth the framework for a Texas Clean School Bus Program under the 

TERP. The Texas Clean School Bus Program is found in 30 TAC Chapter 114, Subchapter K, 

Division 4. After determining that the TERP met the requirements of EPA’s Economic Incentive 

Program guidance, we approved incorporation of the TERP into the Texas SIP on August 15, 

2005 (70 FR 48647). Specifically, the component of the TERP that we approved into the Texas 

SIP in that rulemaking is the Diesel Emissions Reduction Incentive Program for On-Road and 

Non-Road Vehicles. The Diesel Emissions Reduction Incentive Program for On-Road and NonRoad Vehicles and the new Texas Clean School Bus Program are only two of several different 

components of the TERP. The components of the TERP that are before us as a SIP revision are 

the Diesel Emissions Reduction Incentive Program for On-Road and Non-Road Vehicles and the 

new Texas Clean School Bus Program.

 The new Texas Clean School Bus Program (Division 4) and revisions to the Diesel 

Emissions Reduction Incentive Program for On-Road and Non-Road Vehicles (Division 3) were 

reviewed against EPA Guidance: Improving Air Quality with Economic Incentive Programs. In 

EPA nomenclature, TERP is a Financial Mechanism EIP. An EIP is a regulatory program that 

achieves an air quality objective by providing market based incentives or information to 

emission sources. Specifically, a Financial Mechanism EIP is a type of EIP that includes fees, 

taxes, or subsidies targeted at promoting pollution reducing activities or products. There are 

three fundamental principles that apply to all economic incentive programs: integrity, equity, and 

environmental benefit. With the submitted revisions to the TERP Division 3 rules and the new 

Division 4 rules, the TERP program continues to meet each of the criteria. 

Integrity: 

 There are four basic elements that make up integrity. The elements of integrity dictate 

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

permanent. 

 Emissions are considered surplus if they are not otherwise required by any other local, 

state, or federal regulations. Taking into account the revisions to TERP Division 3, reductions 

from the Diesel Emissions Reduction Incentive Program for On-Road and Non-Road Vehicles 

continue to not be allowed to be used for compliance with any state, local or Federal 

requirement. TERP Division 4 reductions cannot be used for compliance with any State, Local 

or Federal requirement. Section 114.644(h) of the Texas Clean School Bus Program 

requirements specifically states that proposed projects are not eligible if they are required by any 

state or federal law, rule or regulation, memorandum of agreement, or other legally binding 

document. 
23

 The reductions are quantifiable. Regarding revisions to Division 3, emissions reductions 

from the Diesel Emissions Reduction Incentive Program for On-Road and Non-Road Vehicles 

continue to be quantifiable. Each grant applicant must quantify the emission reductions that will 

be achieved. Retrofit technology must either be CARB or EPA verified. For those applicants 

receiving a grant under the Rebate Grant Process, NOx emissions reductions are standardized 

according to each designated project type. In the “Evaluation of Testimony” section of the 

State’s submittal, the TCEQ stated that emissions reductions achieved through the Texas Clean 

School Bus Program will be quantified using a comparison of baseline NOx and particulate 

matter emissions with reduced NOx and particulate matter emissions. Engine emission 

certifications and retrofit system verifications by the EPA will be used to verify the emissions of 

the reduced-emissions engines and retrofit systems. Baseline emission rates for uncontrolled 

engines will be based on factors developed and used for SIP modeling purposes by the TCEQ. 

The Clean School Bus Program solicitation documents and grant instructions outline the 

approach for determining emission reductions and cost-effectiveness. The application forms 

require the applicant to provide data on the vehicle or equipment usage patterns, and information 

about the vehicle or equipment needed to determine emission rates. Emission factors, load 

factor, and usage pattern information is used by the TCEQ to calculate emission reductions 

attributed to an activity. The solicitation documents and grant instructions contain information 

on how to determine the level of NOx and particulate matter emissions for the baseline and the 

new vehicle and equipment. Using this information, the TCEQ determines the emissions 

reductions and cost effectiveness of the project. For a project to be eligible for Clean School Bus 

Program funding, the emission rate of engines or the emission reduction factor for retrofit 

systems is required to be certified or verified under an applicable EPA or CARB certification or 

verification program. 

 The reductions from the program are enforceable. The rules for both the Texas Clean 

School Bus Program and the Diesel Emissions Reduction Incentive Program for On-Road and 

Non-Road Vehicles, include the requirement that if a recipient of grant funds fails to meet the 

terms of the grant contract then the recipient is subject to return all or a portion of the funding. 

To insure compliance, each grant recipient must meet the reporting requirements delineated in 

their specific grant agreement, which must occur at least annually. For projects funded under the 

Texas Clean School Bus Program, emissions reductions will be verified by TCEQ through 

reports on use of the grant-funded buses and on-site monitoring and audit visits. The reports and 

monitoring activities will be used by TCEQ to track compliance and effectiveness of the grant 

recipients in fulfilling their obligations under the contract. 

 The reductions are permanent. The TCEQ established the minimum requirement for the 

life of a project under the Texas Clean School Bus Program to be at least five years. The project 

life will be the period in which the grant recipient is contractually obligated to monitor and report 

on the use of the grant-funded vehicle, equipment, and/or fuel. Environmental benefits from 

projects under the Clean School Bus Program will occur for at least this period. Emissions 

reductions achieved through the Texas Clean School Bus Program and the Diesel Emissions 

Reduction Incentive Program for On-Road and Non-Road Vehicles are contractually and 

statutorily permanent for the project life established in the grant contract and will be permanently 

retired. The emission reductions gained by the funded projects creates a permanent shift in the 

emissions reported to the emissions inventory reported to EPA. In the instance that the project 
24

includes a replacement or repower of equipment, the old equipment must be recycled, scrapped, 

or permanently removed from the State of Texas. 

Equity: 

The Texas Clean School Bus Program and the Diesel Emissions Reduction Incentive 

Program for On-Road and Non-Road Vehicles provide grant money that will result in emission 

reductions, so equity issues should not be a problem. Any school district or charter school in the 

State that operates at least one diesel-fueled school bus may apply for a grant under the Texas 

Clean School Bus Program. Projects eligible for Texas Clean School Bus Program funding are 

not restricted to nonattainment and near nonattainment areas of Texas. Nonattainment areas are 

geographic areas that fail to meet the National Ambient Air Quality Standards. Near 

nonattainment areas are counties which could potentially become nonattainment in the near 

future. 

Any owner and operator in the nonattainment and near nonattainment areas of the State 

may apply for grant opportunities under the Diesel Emissions Reduction Incentive Program for 

On-Road and Non-Road Vehicles. Projects eligible for the Diesel Emissions Reduction 

Incentive Program for On-Road and Non-Road Vehicles are restricted to the nonattainment and 

near nonattainment areas of the State, as well as certain highways and roadways designated by 

the TCEQ and located outside a nonattainment area. At least 75 percent of the vehicle miles 

traveled or hours of operations for the project for the five years immediately following the award 

of the grant must take place in a nonattainment area or other affected county, or on highways and 

roadways designated by TCEQ and located outside a nonattainment area. This percentage of use 

requirement is a criterion used by TCEQ to determine program eligibility, and usage outside of 

the nonattainment areas or affected counties will not count towards the emissions reductions 

used to determine the cost-effectiveness of the project. The emission reductions generated by 

projects funded by the Diesel Emissions Reduction Incentive Program for On-Road and NonRoad Vehicles are in nonattainment and near non attainment areas of Texas, as well as certain 

areas around the nonattainment areas. 

 The improvement to regional air quality and the ability for any school district or charter 

school in the State to apply for grant opportunities under the Texas Clean School Bus Program, 

and any owner or operator in the nonattainment and near nonattainment areas of the State, as 

well as certain highways and roadways designated by the TCEQ and located outside a 

nonattainment area, to apply for grants under the Diesel Emissions Reduction Incentive Program 

for On-Road and Non-Road Vehicles, provides for equity. 

Environmental Benefit: 

The Texas Clean School Bus Program framework provides an environmental benefit by 

encouraging the early introduction of use of lower emitting diesel technologies in the state of 

Texas. The emission reductions generated through the projects funded by the Texas Clean 

School Bus Program and the Diesel Emissions Reduction Incentive Program for On-Road and 

Non-Road Vehicles, would have not otherwise occurred at this time. The long operational life of 

diesel equipment makes the introduction of newer cleaner burning engines into a fleet a long 

term process. With the aid of grants under the Texas Clean School Bus Program and the Diesel 

Emissions Reduction Incentive Program for On-Road and Non-Road Vehicles, many of the 
25

older, dirtier engines may be replaced, repowered, or retrofitted with emission control devices 

sooner than it would have otherwise occurred. 

Program Tracking: 

 The TCEQ must submit a biennial report to the Texas Legislature on the status of the 

implementation of TERP no later than December 1 of each even numbered year. The TCEQ, 

under the consultation of the TERP Advisory Board, must review annually and document in the 

report the programs established by the plan. The biennial report includes a review and discussion 

of each project funded under the plan, the amount granted for each project, the emission 

reductions attributed to each project, and the cost effectiveness of each project. If the project is 

an infrastructure project, then the report also includes an evaluation of the degree to which the 

project supports on-road and non-road diesel projects and the amount of fuel or electricity 

dispensed. 

 The plan must also account for monies received, disbursed as grants, reserved for grants 

based upon project approvals, and recommendations of transfer between allocations. An estimate 

of future demand must also be provided along with an evaluation of the plan’s effectiveness at 

providing emission reductions which are creditable toward the SIP, solicitation and evaluation of 

project applications, awards, and implementation monitoring. If any changes occur in project 

selection criteria, award criteria or administrative procedure, these would also be included in the 

report. The benefits and possibilities of including other pollutants in TERP would also be 

discussed. The TCEQ conducts a public hearing and comment period on each draft of the 

biennial report while constructing the final report. 

Recommendation: 

 The revisions to the TERP program, outlined in the Table above, address the elements of 

EPA’s EIP guidance. Therefore, revisions to the TERP should be approved. 

Conclusion: 

Based on the evaluation set forth in this TSD, we recommend approval of revisions to 30 

TAC Chapter 114, as submitted to us on May 15, 2006, October 10, 2006, January 17, 2008, and 

February 28, 2008, into the Texas SIP.