Bryan W. Shaw, Ph.D., Chairman 

Buddy Garcia, Commissioner 

Carlos Rubinstein, Commissioner 

Mark R. Vickery, P.G., Executive Director 

RECEIVED- 6PDL 

AIR PLANNING S£C. 

12 APR 30 PH 5: 23 

TEXAS COMMISSION ON ENVIRONMENTAL QUALI1Y 

Protecting Tex<LS by Reducing and Preventing Pollution 

Alfredo Armendariz, Ph.D. 

Regional Administrator 

April 13, 2012 

U.S. Environmental Protection Agency - Region 6 

1445 Ross Avenue 

Dallas, Texas 75202-2733 

Dear Dr. Armendariz: 

DocketNo. 2011-1220-RUL 

Rule Project No. 2011-051-114-EN 

On March 28, 2012, the Texas Commission on Environmental Quality (Commission) adopted 

revisions to the State Implementation Plan (SIP). 

The Commission adopted amendments to§§ 114.650- 114.65! in 30 TAC Chapter 114, Control of Air 

Pollution from Motor Vehicles, Subchapter K, Mobile Source Incentive Programs, Division 5, Texas 

Clean Fleet Program; and corresponding revisions to the SIP. 

The amendments implement part of House Bil13399, 82nd Legislature, 2011, Regular Session, 

relating to requirements for receiving an incentive grant under the Texas Clean Fleet Program. The 

revisions to Chapter 114 incorporate changes and additions to the program eligibility criteria and add 

provisions that the executive director shall waive the ownership and use requirements for the vehicle 

being replaced upon a finding of good cause. 

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

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

revisions. 

Sincerely, 

~-;~:,~ Chairman 

BWS/sd 

Enclosures 

cc: The Honorable Rick Perry, Governor of Texas 

Mr. Toby Baker, Office of Budget, Planning and Policy, Office of the Governor 

Mr. Mark R. Vickery, P.G., Executive Director, Texas Commission on Environmental Quality 

P.O. Box 13087 • Austin, Texas 78711-3087 • 512-239-1000 • www.tceq.texas.gov 

How is our customer service? www.tceq.texas.govjgotojcustomersurvey 
TEXAS COMMISSION ON ENVIRONMENTAL QUALITY 

Docket No. 2011-1220-RUL 

THE STATE OF TEXAS 

COUNTY OF TRAVIS 

This is to certify that the attached electronic file is included and that the electronic file is a 

true and correct copy of documents for a revision to the Texas State Implementation Plan, 

adopted on March 28, 2012, pursuant to 40 Code of Federal Regulations§ 51.104. I am the 

records administrator for the Air Quality Division of the Texas Commission on 

Environmental Quality (Commission). 

+~&~ Air Quality Division 

Texas Commission on Environmental Quality 
Texas Commission on Environmental Quality 

Public Hearing 

November 29, 2011 

Concerning Revisions to 30 T AC Chapter 114 

Texas Clean Fleet Program Rules 

Project No. 2011-051-114-EN 
INTRODUCTION 

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

November 29, 2011, to receive testimony regarding revisions to 30 TAC Chapter 114 and 

corresponding revisions to the state implementation plan. 

The adoption implements part of House Bill (HB) 3399, 82nd Legislature, 2011, Regular Session, 

relating to requirements for receiving an incentive grant under the Texas Clean Fleet Program. The 

revisions to Chapter 114, as required by HB 3399, incorporate changes and additions to the 

program eligibility criteria, including: changes to the number of vehicles that must be included in a 

grant and that may be awarded funding by the commission; changes to allow a vehicle that has 

been leased or commercially financed to be replaced under the program; changes to the time period 

over which a grant-funded vehicle must be operated; and establishing criteria for decommissioning a 

vehicle or vehicle engine replaced under the program. In addition, the revisions include provisions, 

as required under HB 3399, that the executive director shall waive the ownership and use 

requirements for the vehicle being replaced, upon a finding of good cause. 

The comment period closed on December 5, 2011. All testimony and comments have been 

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

hearings and is divided into the following four sections: 

o Public Notification and Proposal 

o Written and Oral Testimony 

o Evaluation of Testimony 

o Staff Recommendations/Order 

Additional copies of this hearing record are maintained in the TCEQ central office at 12100 Park 35 
Circle, Austin, Texas 78753. For further information, please contact Stephen Dayton at (512) 239-

6824. 
NOTICE & PROPOSAL 
PUBLIC NOTIFICATION 

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

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

Austin American-Statesman: October 20, 2011 

Beaumont Enterprise: October 20, 2011 

El Paso Times: October 20, 2011 

Fort Worth Star-Telegram: October 20, 2011 

Houston Chronicle: October 20, 2011 

Longview News-Journal: October 20, 2011 

San Antonio Express-News: October 20, 2011 

2. Publication of the proposed rules in the November 4, 2011, issue of the Texas Register (36 

TexReg 7472). 

3. Publication of the Notice of Public Hearing in the November 4, 2011, issue of the Texas Register 

(36 TexReg 7597). 

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

Speaker of the House 

Lieutenant Governor 

Alamo Area Council of Governments 

Capital Area Planning Council 

City of Austin, Mayor's Office 

City of Dallas, Department of Environmental Quality 

City of Dallas, Department of Aviation 

City of El Paso, Environmental Services 
City of Fort Worth, Environmental Management Department 

City of Houston, Department of Health and Human Services 

East Texas Council of Governments 

El Paso Metropolitan Planning Organization 

Federal Highway Administration 

Galveston County Health District 

Harris County Public Health and Environmental Services 

North Central Texas Council of Governments 

Houston-Galveston Area Council 

South East Texas Regional Planning Commission 

Texas Department of Transportation 

Travis County Judge 

Victoria Metropolitan Planning Organization 

Arkansas Department of Pollution Control and Ecology 

Louisiana Department of Environmental Quality 

New Mexico Environmental Department 

Oklahoma Department of Environmental Quality 

United States Environmental Protection Agency 
Example of Newspaper Classified Ad 

Austin American-Statesman, October 20, 2011 

NOTICE OF PUBLIC HEARING BY THETEXAS COMMISSION ON ENVIRONMENTAL 

QUALITYON PROPOSED REVISIONS TO 30 TAC CHAPTER 114 AND TO THE STATE 

IMPLEMENTATION PLAN 

The Texas Commission on Environmental Quality (commission) will conduct a public hearing to 

receive testimony regarding proposed revisions to 30 TAC Chapter 114, Control of Air Pollution from 

Motor Vehicles, and corresponding revisions to the state implementation plan (SIP) under the 

requirements of Texas Health and Safety Code, §382.017; Texas Government Code, Chapter 2001, 

Subchapter B; and 40 Code of Federal Regulations §51.102, and the United States Environmental 

Protection Agency (EPA) conceming SIPs. 

The commission proposes to amend Chapter 114, Subchapter K, Division 3, Diesel Emissions 

Reduction Incentive Program for On-Road and Non-Road Vehicles, to implement changes made to 

Texas Heatth and Safety Code, Chapter 386, Subchapter C, Diesel Emissions Reduction Incentive 

Program, by House Bill 3399, 82nd Legislature, 2011. The proposed changes and additions involve 

criteria for the use of grant-funded vehicles and engines, destruction of vehicles and engines 

replaced under the program, ownership or lease of vehicles to be replaced under the program, and 

waiver of certain eligibility requirements by the executive director. (Rule Project Number 2011-050-

114-EN) 

The commission proposes to amend Chapter 114, Subchapter K, Division 5, Texas Clean Fleet 

Program, to implement changes made to Texas Health and Safety Code, Chapter 391, Texas Clean 

Fleet Program, by House Bill 3399, 82nd Legislature, 2011. The proposed changes and additions 

involve the number of vehicles that must be registered and operated in Texas by an eligible grant 

applicant, the number of vehicles that must be replaced under a grant. the period of commitment by 

a grant recipient for use of the grant-funded vehicles, requirements on the ownership or lease of the 

.vehicles being replaced, and the destruction requirements for the vehicles and engines being 

replaced. (Rule Project Number 2011-051-114-EN) 

The commission proposes to amend Chapter 114, Subchapter K, to add a new Division 6, 

Alternative Fueling Facilities Program. The proposed rulemaking would implement a portion of 

Senate Bill 385, 82nd Legislature, 2011, by adding the criteria that may be used by the executive 

director for prioritizing facilities eligible to receive grants under the Alternative Fueling Facilities 

Program, established under Texas Health and Safety Code, Chapter 393. (Rule Project Number 

2011-052 -114-EN) 

The commission proposes to amend Chapter 114, Subchapter K, to add a new Division 7, Texas 

Natural Gas Vehicle Grant Program. The proposed rulemaking would implement a portion of Senate 

Bill 385, 82nd Legislature, 2011, by adding the criteria that may be used by the executive director 

for prioritizing qualifying vehicles eligible to receive grants under the Texas Natural Gas Vehicle 

Grant Program, established under Texas Health and Safety Code, Chapter394. (Rule Project 

· Number 2011-053-114-EN)A public hearing on these proposals will be held in Austin on November 

29,2011, at 10:00 a.m. in Building E. Room 201S, at the commission's centra! office located at 

12100 Parik 35 Circle. The hearing will be structured for the receipt of oral and written comments by 

interested persons. Registration will begin 30 minutes prior to the hearing. Interested persons may 

present oral statements when called upon in order of registration. Open discussion will not be 

permitted during the hearing; however, commission staff members will be available to discuss the 

proposal 30 minutes prior to the hearing. 

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

needs should contact Sandy Wong, Texas Register Team, at (512) 239-1802. Requests should be 

made as far in advance as possible. 

Written comments on Rule Project Numbers 2011-050-114-EN and 2011-051-114-EN may be 

submitted to Charlotte Hom, and written comments on Rule Project Numbers 2011-052-114-EN and 

2011-053-114-EN may be submitted to Bruce McAnally, at Texas Register Team, Office of Legal 

Services, Texas Commission on Environmental Quality, MC 205, P.O. Box 13087, Austin, Texas 

78711-3087, or faxed to (512) 239-4808. Electronic comments may be submitted at 

http://www5.tceq. state.tx.us/rules/ ecomments/. File size restrictions may apply to comments being 

submitted via the eComments system. All comments should reference the rule project number that 

the comment pertains to: Rule Project Number 2011-050-114-EN for the proposed Diesel Emissions 

Reduction Incentive Program for On-Road and Non-Road Vehicles rule amendments; Rule Project 

Number 2011-051-114-EN for the proposed Texas Clean Fleet P~ogram nule amendments; Rule 

Project Number 2011-052-114-EN forthe proposed Alternative Fueling Facilities Program rule; and 

Rule Project Number 2011-053-114-EN for the proposed Texas Natural Gas Vehicle Grant Program 

rule. The comment period closes December 5, 2011. Copies of the proposed rules can be obtained 

from the commission's Web site at http:l/www.tceq. texas.gov/navlrules/ propose_adopt.html. For 

additional information regarding the proposed rulemaking, please contact Stephen Dayton, 

Implementation Grants Section, at (512) 239-6824. 
ƇƇƇ

ƇƇƇ

derground storage tank (UST) system found to be noncompliant with

release detection, spill and overfill prevention, and/or, after December

22, 1998, cathodic protection regulations of the commission, until such

time as the owner/operator brings the UST system into compliance

with those regulations. The commission proposes a Shutdown Order

after the owner or operator of a UST facility fails to perform required

corrective actions within 30 days after receiving notice of the release

detection, spill and overfill prevention, and/or, after December 22,

1998, cathodic protection violations documented at the facility. The

commission proposes a Default Order when the staff has sent an

executive director’s preliminary report and petition (EDPRP) to an

entity outlining the alleged violations; the proposed penalty; and the

proposed technical requirements necessary to bring the entity back

into compliance; and the entity fails to request a hearing on the matter

within 20 days of its receipt of the EDPRP or requests a hearing and

fails to participate at the hearing. In accordance with TWC, §7.075,

this notice of the proposed order and the opportunity to comment is

published in the Texas Register no later than the 30th day before the

date on which the public comment period closes, which in this case

is December 5, 2011. The commission will consider any written

comments received and the commission may withdraw or withhold

approval of a S/DO if a comment discloses facts or considerations that

indicate that consent to the proposed S/DO is inappropriate, improper,

inadequate, or inconsistent with the requirements of the statutes and

rules within the commission’s jurisdiction, or the commission’s orders

and permits issued in accordance with the commission’s regulatory

authority. Additional notice of changes to a proposed S/DO is not

required to be published if those changes are made in response to

written comments.

Copies of each of the proposed S/DO are available for public inspection

at both the commission’s central office, located at 12100 Park 35 Circle, Building A, 3rd Floor, Austin, Texas 78753, (512) 239-3400 and

at the applicable regional office listed as follows. Written comments

about the S/DO shall be sent to the attorney designated for the S/DO

at the commission’s central office at P.O. Box 13087, MC 175, Austin,

Texas 78711-3087 and must be received by 5:00 p.m. on December

5, 2011. Written comments may also be sent by facsimile machine to

the attorney at (512) 239-3434. The commission attorneys are available to discuss the S/DOs and/or the comment procedure at the listed

phone numbers; however, comments on the S/DOs shall be submitted

to the commission in writing.

(1) COMPANY: Ali Attayi dba Attayi Service Station; DOCKET

NUMBER: 2011-0296-PST-E; TCEQ ID NUMBER: RN102648508;

LOCATION: 6730 Telephone Road, Houston, Harris County; TYPE

OF FACILITY: underground storage tank (UST) system and a used car

lot and mechanic shop; RULES VIOLATED: 30 TAC §334.7(d)(3),

by failing to provide an amended registration for any change or

additional information regarding the USTs; 30 TAC §37.815(a) and

(b), by failing to demonstrate acceptable financial assurance for taking

correction action and for compensating third parties for bodily injury

and property damage caused by accidental releases arising from the

operation of the petroleum USTs; TWC, §26.3475(c)(1) and 30 TAC

§334.50(b)(1)(A), by failing to ensure that the USTs are monitored in a

manner which will detect a release at a frequency of at least once every

month (not to exceed 35 days between each monitoring); PENALTY:

$10,273; STAFF ATTORNEY: Gary Shiu, Litigation Division, MC

R-12, (713) 422-8916; REGIONAL OFFICE: Houston Regional

Office, 5425 Polk Avenue, Suite H, Houston, Texas 77023-1452, (713)

767-3500.

TRD-201104609

Kathleen C. Decker

Director, Litigation Division

Texas Commission on Environmental Quality

Filed: October 25, 2011

Notice of Public Hearing on Proposed New 30 TAC Chapter 36

The Texas Commission on Environmental Quality (commission) will

conduct a public hearing to receive testimony regarding proposed new

30 Texas Administrative Code (TAC) Chapter 36, Suspension or Adjustment of Water Rights During Drought or Emergency Water Shortage, under the requirements of Texas Government Code, Chapter 2001,

Subchapter B.

The proposed rulemaking would implement House Bill 2694, §5.03,

82nd Legislature, 2011, relating to the executive director’s suspension

or adjustment of water rights during drought or emergency water shortage. The proposed rulemaking would define "drought" and "emergency

shortage of water," set out procedures for the executive director’s order

under this chapter, provide the terms of the order and conditions that

must be met before an order can be issued, and establish an appeal of

the executive director’s order to the commission.

The commission will hold a public hearing on this proposal in Austin on

December 1, 2011 at 2:00 p.m. in Building E, Room 201S, at the commission’s central office located at 12100 Park 35 Circle. The hearing

is structured for the receipt of oral or written comments by interested

persons. Individuals may present oral statements when called upon in

order of registration. Open discussion will not be permitted during the

hearing; however, commission staff members will be available to discuss the proposal 30 minutes prior to the hearing.

Persons who have special communication or other accommodation

needs who are planning to attend the hearing should contact Sandy

Wong, Office of Legal Services, at (512) 239-1802. Requests should

be made as far in advance as possible.

Written comments may be submitted to Michael Parrish, MC 205,

Office of Legal Services, Texas Commission on Environmental

Quality, P.O. Box 13087, Austin, Texas 78711-3087, or faxed

to (512) 239-4808. Electronic comments may be submitted at:

http://www5.tceq.state.tx.us/rules/ecomments/. File size restrictions may apply to comments being submitted via the eComments

system. All comments should reference Rule Project Number

2011-033-036-LS. The comment period closes December 5, 2011.

Copies of the proposed rulemaking can be obtained from the

commission’s website at http://www.tceq.state.tx.us/nav/rules/propose_adopt.html. For further information, please contact Robin Smith,

Environmental Law Division, (512) 239-0463.

TRD-201104484

Robert Martinez

Director, Environmental Law Division

Texas Commission on Environmental Quality

Filed: October 21, 2011

Notice of a Public Hearing on Proposed Revisions to 30 TAC

Chapter 114 and to the State Implementation Plan

The Texas Commission on Environmental Quality (commission) will

conduct a public hearing to receive testimony regarding proposed revisions to 30 TAC Chapter 114, Control of Air Pollution from Motor Vehicles, and corresponding revisions to the state implementation

plan (SIP) under the requirements of Texas Health and Safety Code,

§382.017; Texas Government Code, Chapter 2001, Subchapter B; and

IN ADDITION November 4, 2011 36 TexReg 7597
ƇƇƇ

40 Code of Federal Regulations §51.102, and the United States Environmental Protection Agency (EPA) concerning SIPs.

The commission proposes to amend Chapter 114, Subchapter K, Division 3, Diesel Emissions Reduction Incentive Program for On-Road

and Non-Road Vehicles, to implement changes made to Texas Health

and Safety Code, Chapter 386, Subchapter C, Diesel Emissions Reduction Incentive Program, by House Bill 3399, 82nd Legislature, 2011.

The proposed changes and additions involve criteria for the use of

grant-funded vehicles and engines, destruction of vehicles and engines

replaced under the program, ownership or lease of vehicles to be replaced under the program, and waiver of certain eligibility requirements by the executive director. (Rule Project Number 2011-050-

114-EN)

The commission proposes to amend Chapter 114, Subchapter K, Division 5, Texas Clean Fleet Program, to implement changes made to

Texas Health and Safety Code, Chapter 391, Texas Clean Fleet Program, by House Bill 3399, 82nd Legislature, 2011. The proposed

changes and additions involve the number of vehicles that must be registered and operated in Texas by an eligible grant applicant, the number

of vehicles that must be replaced under a grant, the period of commitment by a grant recipient for use of the grant-funded vehicles, requirements on the ownership or lease of the vehicles being replaced, and the

destruction requirements for the vehicles and engines being replaced.

(Rule Project Number 2011-051-114-EN)

The commission proposes to amend Chapter 114, Subchapter K, to

add a new Division 6, Alternative Fueling Facilities Program. The

proposed rulemaking would implement a portion of Senate Bill 385,

82nd Legislature, 2011, by adding the criteria that may be used by the

executive director for prioritizing facilities eligible to receive grants

under the Alternative Fueling Facilities Program, established under

Texas Health and Safety Code, Chapter 393. (Rule Project Number

2011-052-114-EN)

The commission proposes to amend Chapter 114, Subchapter K, to add

a new Division 7, Texas Natural Gas Vehicle Grant Program. The proposed rulemaking would implement a portion of Senate Bill 385, 82nd

Legislature, 2011, by adding the criteria that may be used by the executive director for prioritizing qualifying vehicles eligible to receive

grants under the Texas Natural Gas Vehicle Grant Program, established

under Texas Health and Safety Code, Chapter 394. (Rule Project

Number 2011-053-114-EN)

A public hearing on these proposals will be held in Austin on November 29, 2011, at 10:00 a.m. in Building E, Room 201S, at the commission’s central office located at 12100 Park 35 Circle. The hearing will

be structured for the receipt of oral and written comments by interested

persons. Registration will begin 30 minutes prior to the hearing. Interested persons may present oral statements when called upon in order

of registration. Open discussion will not be permitted during the hearing; however, commission staff members will be available to discuss

the proposal 30 minutes prior to the hearing.

Persons planning to attend the hearing who have special communication or other accommodation needs should contact Sandy Wong, Texas

Register Team, at (512) 239-1802. Requests should be made as far in

advance as possible.

Written comments on Rule Project Numbers 2011-050-114-EN

and 2011-051-114-EN may be submitted to Charlotte Horn, and

written comments on Rule Project Numbers 2011-052-114-EN and

2011-053-114-EN may be submitted to Bruce McAnally, at Texas

Register Team, Office of Legal Services, Texas Commission on

Environmental Quality, MC 205, P.O. Box 13087, Austin, Texas

78711-3087, or faxed to (512) 239-4808. Electronic comments may be

submitted at http://www5.tceq.state.tx.us/rules/ecomments/. File size

restrictions may apply to comments being submitted via the eComments system. All comments should reference the rule project number

that the comment pertains to: Rule Project Number 2011-050-114-EN

for the proposed Diesel Emissions Reduction Incentive Program for

On-Road and Non-Road Vehicles rule amendments; Rule Project

Number 2011-051-114-EN for the proposed Texas Clean Fleet Program rule amendments; Rule Project Number 2011-052-114-EN for

the proposed Alternative Fueling Facilities Program rule; and Rule

Project Number 2011-053-114-EN for the proposed Texas Natural Gas

Vehicle Grant Program rule. The comment period closes December

5, 2011. Copies of the proposed rules can be obtained from the

commission’s website at http://www.tceq.texas.gov/nav/rules/propose_adopt.html. For additional information regarding the proposed

rulemaking, please contact Stephen Dayton, Implementation Grants

Section, at (512) 239-6824.

TRD-201104480

Robert Martinez

Director, Environmental Law Division

Texas Commission on Environmental Quality

Filed: October 21, 2011

Notice of Receipt of Application and Intent to Obtain a

Municipal Solid Waste Permit Amendment

APPLICATION. Liquid Environmental Solutions of Texas, LLC,

7651 Esters Boulevard, Suite 200, Irving, Dallas County, Texas

75063, a Type V, liquid waste processing facility that de-waters,

recycles, and pre-treats non-hazardous liquid waste from municipal

and industrial generators, has applied to the Texas Commission on

Environmental Quality (TCEQ) for a permit amendment to authorize

an increase in the permitted liquid waste treatment capacity from

6 million gallons per month (200,000 gallons per day) to 354,500

gallons per day; the extension of waste acceptance hours from 7:30

a.m. - 5:30 p.m. to 6:30 a.m. - 6:30 p.m.; a variance from buffer zone

requirements; and a name change for the owner/operator from Liquid

Environmental Solutions of Texas, L.P., to Liquid Environmental

Solutions of Texas, LLC. The facility is located at 250 Gellhorn

Drive, Houston, Harris County, Texas 77013. The TCEQ received

the application on August 16, 2011. The permit application is available for viewing and copying at the Harris County Public Library,

1026 Mercury Drive, Houston, Harris County, Texas 77029. The

following link to an electronic map of the site or facility’s general

location is provided as a public courtesy and is not part of the application or notice: http://www.tceq.texas.gov/assets/public/hb610/index.html?lat=29.785555&ing=-95.260833&zoom=13&type=r. For

exact location, refer to application.

ADDITIONAL NOTICE. TCEQ’s Executive Director has determined

the application is administratively complete and will conduct a technical review of the application. After technical review of the application

is complete, the Executive Director may prepare a draft permit and will

issue a preliminary decision on the application. Notice of the Application and Preliminary Decision will be published and mailed to those

who are on the county-wide mailing list and to those who are on the

mailing list for this application. That notice will contain the deadline

for submitting public comments.

PUBLIC COMMENT/PUBLIC MEETING. You may submit public

comments or request a public meeting on this application. The purpose

of a public meeting is to provide the opportunity to submit comments

or to ask questions about the application. TCEQ will hold a public

meeting if the Executive Director determines that there is a significant

degree of public interest in the application or if requested by a local

legislator. A public meeting is not a contested case hearing.

36 TexReg 7598 November 4, 2011 Texas Register
Bryan W. Shaw, Ph.D., Chairman 

Buddy Garcia, Commissioner 

Carlos Rubinstein, Commissioner 

Mark R. Vickery, P.G., Executive Director 

TEXAS COMMISSION ON ENVIRONMENTAL QUALITY 

Protecting Texas by Reducing and Preventing Pollution 

NOTICE OF PUBLIC HEARING BY THE 

TEXAS COMMISSION ON ENVIRONMENTAL QUALITY 

ON PROPOSED REVISIONS TO 30 TAC CHAPTER 114 AND TO THE STATE 

IMPLEMENTATION PLAN 

The Texas Commission on Environmental Quality (commission) will conduct a public 

hearing to receive testimony regarding proposed revisions to 30 TAC Chapter 114, 

Control of Air Pollution from Motor Vehicles, and corresponding revisions to the state 

implementation plan (SIP) under the requirements of Texas Health and Safety Code, 

§382.017; Texas Government Code, Chapter 2001, Subchapter B; and 40 Code of 

Federal Regulations §51.102, and the United States Environmental Protection Agency 

(EPA) concerning SIPs. 

The commission proposes to amend Chapter 114, Subchapter K, Division 3, Diesel 

Emissions Reduction Incentive Program for On-Road and Non-Road Vehicles, to 

implement changes made to Texas Health and Safety Code, Chapter 386, Subchapter C, 

Diesel Emissions Reduction Incentive Program, by House Bill 3399, 82nd Legislature, 

2011. The proposed changes and additions involve criteria for the use of grant-funded 

vehicles and engines, destruction of vehicles and engines replaced under the program, 

ownership or lease of vehicles to be replaced under the program, and waiver of certain 

eligibility requirements by the executive director. (Rule Project Number 2011-050-

114-EN) 

The commission proposes to amend Chapter 114, Subchapter K, Division 5, Texas Clean 

Fleet Program, to implement changes made to Texas Health and Safety Code, Chapter 

391, Texas Clean Fleet Program, by House Bill 3399, 82nd Legislature, 2011. The 

proposed changes and additions involve the number of vehicles that must be registered 

and operated in Texas by an eligible grant applicant, the number of vehicles that must 

be replaced under a grant, the period of commitment by a grant recipient for use of the 

P.O. Box 13087 • Austin, Texas 78711-3087 • 512-239-1000 • Internet address: www.tceq.state.tx.us 
grant-funded vehicles, requirements on the ownership or lease of the vehicles being 

replaced, and the destruction requirements for the vehicles and engines being replaced. 

(Rule Project Number 2011-051-114-EN) 

The commission proposes to amend Chapter 114, Subchapter K, to add a new Division 6, 

Alternative Fueling Facilities Program. The proposed rulemaking would implement a 

portion of Senate Bill 385, 82nd Legislature, 2011, by adding the criteria that may be 

used by the executive director for prioritizing facilities eligible to receive grants under 

the Alternative Fueling Facilities Program, established under Texas Health and Safety 

Code, Chapter 393· (Rule Project Number 2011-052-114-EN) 

The commission proposes to amend Chapter 114, Subchapter K, to add a new Division 7, 

Texas Natural Gas Vehicle Grant Program. The proposed rulemaking would implement 

a portion of Senate Bill385, 82nd Legislature, 2011, by adding the criteria that may be 

used by the executive director for prioritizing qualifying vehicles eligible to receive 

grants under the Texas Natural Gas Vehicle Grant Program, established under Texas 

Health and Safety Code, Chapter 394. (Rule Project Number 2011-053-114-EN) 

A public hearing on these proposals will be held in Austin on November 29, 2011, at 

10:00 a.m. in Building E, Room 201S, at the commission's central office located at 12100 

Park 35 Circle. The hearing will be structured for the receipt of oral and written 

comments by interested persons. Registration will begin 30 minutes prior to the 

hearing. Interested persons may present oral statements when called upon in order of 

registration. Open discussion will not be permitted during the hearing; however, 

commission staff members will be available to discuss the proposal 30 minutes prior to 

the hearing. 

Persons planning to attend the hearing who have special communication or other 

accommodation needs should contact Sandy Wong, Texas Register Team, at (512) 239-

1802. Requests should be made as far in advance as possible. 
Written comments on Rule Project Numbers 2011-050-114-EN and 2011-051-114-EN 

may be submitted to Charlotte Horn, and written comments on Rule Project Numbers 

2011-052-114-EN and 2011-053-114-EN may be submitted to Bruce McAnally, at Texas 

Register Team, Office of Legal Services, Texas Commission on Environmental Quality, 

MC 205, P.O. Box 13087, Austin, Texas 78711-3087, or faxed to (512) 239-4808. 

Electronic comments may be submitted at 

http:jjwwws.tceq.state.tx.usjrulesjecommentsj. File size restrictions may apply to 

comments being submitted via the eComments system. All comments should 

reference the rule project number that the comment pertains to: Ruie 

Project Number 2011-050-114-EN for the proposed Diesel Emissions 

Reduction Incentive Program for On-Road and Non-Road Vehicles ruie 

amendments; Rule Project Number 2011-051-114-EN for the proposed Texas 

Clean Fleet Program ruie amendments; Ruie Project Number 2011-052-114-

EN for the proposed Alternative Fueling Facilities Program ruie; and Ruie 

Project Number 2011-053-114-EN for the proposed Texas Natural Gas 

Vehicle Grant Program rule. The comment period closes December 5, 2011. 

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

http://www.tceq.texas.govjnavjrulesjpropose_adopt.html. For additional 

information regarding the proposed rulemaking, please contact Stephen Dayton, 

Implementation Grants Section, at (512) 239-6824. 

Issued in Austin, Texas, on October 18, 2011. 
ƇƇƇ

(f) For a project to replace a motor vehicle, the vehicle being replaced may have been owned, leased, or otherwise commercially

financed by the applicant. The applicant must have a legal right to

replace and recycle or scrap the vehicle and engine before a grant is

awarded for that project.

(g) [(d)] To be eligible for a grant, the cost-effectiveness of a

proposed project as listed in subsection (a) of this section, except for

infrastructure projects and infrastructure purchases that are part of a

broader retrofit, repower, replacement, or add-on equipment project,

must not exceed a cost-effectiveness of $15,000 per ton of NOX emissions reduced. The commission may set lower cost-effectiveness limits

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

may also base project selection decisions on additional measures to

evaluate the effectiveness of projects in reducing NOX emissions in relation to the funds to be awarded.

(h) The executive director shall waive eligibility requirements

established under subsections (b) - (f) of this section on a finding of

good cause, which may include a waiver of any ownership and use

requirements established for replacement of a motor vehicle for short

lapses in registration or operation attributable to economic conditions,

seasonal work, or other circumstances.

(i) [(e)] Projects funded with a grant from this program may

not be used for credit under any state or federal emissions reduction

credit averaging, banking, or trading program except as provided under

Texas Health and Safety Code, §386.056.

(j) [(f)] A proposed project as listed in subsection (a) of this

section is not eligible if it is required by any state or federal law, rule or

regulation, memorandum of agreement, or other legally binding document. This subsection does not apply to:

(1) an otherwise qualified project, regardless of the fact that

the state implementation plan assumes that the change in equipment,

vehicles, or operations will occur, if on the date the grant is awarded

the change is not required by any state or federal law, rule or regulation,

memorandum of agreement, or other legally binding document; or

(2) the purchase of an on-road diesel or equipment required

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

policy of a public or private entity.

(k) [(g)] A proposed retrofit, repower, replacement, or addon equipment project must achieve a reduction in NOX emissions to

the level established in the commission’s Texas Emissions Reduction

Plan: Guidelines for Emissions Reduction Incentive Grants Program

(RG-388) for that type of project compared with the baseline emissions

adopted by the commission for the relevant engine year and application.

(l) [(h)] If a grant recipient fails to meet the terms of a project

grant or the conditions of this division, the executive director can require that the grant recipient return some or all of the grant funding

to the extent that emission reductions are not achieved or cannot be

demonstrated.

(m) [(i)] Criteria established in the guidelines, including revisions to the commission’s Texas Emissions Reduction Plan: Guidelines

for Emissions Reduction Incentive Grants Program (RG-388), apply

to the Texas Emissions Reduction Plan program. Notwithstanding the

provisions of this chapter, as authorized under Texas Health and Safety

Code, §386.053(d), revisions to the guidelines may include, among

other changes, adding additional pollutants; adding stationary engines

or engines used in stationary applications; adding vehicles and equipment that use fuels other than diesel; or adjusting eligible program categories; as appropriate, to ensure that incentives established under this

program achieve the maximum possible emission reductions.

This agency hereby certifies that the proposal has been reviewed

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

Filed with the Office of the Secretary of State on October 21,

2011.

TRD-201104481

Robert Martinez

Director, Environmental Law Division

Texas Commission on Environmental Quality

Earliest possible date of adoption: December 4, 2011

For further information, please call: (512) 239-0779

DIVISION 5. TEXAS CLEAN FLEET

PROGRAM

30 TAC §§114.650 - 114.654

The Texas Commission on Environmental Quality (TCEQ,

commission, or agency) proposes amendments to §§114.650 -

114.654.

If adopted, the amended sections will be submitted to the United

States Environmental Protection Agency (EPA) as revisions to

the state implementation plan.

Background and Summary of the Factual Basis for the Proposed

Rules

Senate Bill 1759, 81st Legislature, 2009, amended the Texas

Health and Safety Code (THSC), by adding Chapter 391, Texas

Clean Fleet Program (program). This program is designed to encourage eligible fleets to replace diesel vehicles with alternative

fuel or hybrid vehicles. House Bill (HB) 3399, 82nd Legislature,

2011, amended THSC, Chapter 391, to revise current eligibility

criteria and add additional criteria. The changes made under HB

3399 are as summarized in the following paragraphs.

THSC, §391.002(b), was revised to reduce the number of qualifying vehicles that an entity must place in service in the state in

order to be eligible to participate in the program from 25 to 20 vehicles. This provision is then qualified under THSC, §391.002(c),

to allow for commission funding of fewer than 20 vehicles under a

grant, as long as an entity’s application originally included 20 vehicles for replacement under the program. This provision allows

an application to be approvable in the event that the commission does not approve one or more vehicles for funding during

the application process.

THSC, §391.004(a), was revised to reduce from 100 to 75 the

number of vehicles that any entity must operate in its fleet in the

state in order to be eligible to apply for and receive a grant under

the program.

Under a new THSC, §391.004(d), the commission is directed to

minimize, to the maximum extent possible, the amount of paperwork required for an application. In addition, an applicant may

be required to submit a photograph or other documentation of a

vehicle identification number, registration information, inspection

information, tire condition, or engine block identification only if it

is requested after the commission has decided to award a grant

to the applicant.

THSC, §391.005(b)(2)(A), was revised to allow a vehicle that has

been leased or otherwise commercially financed and registered

36 TexReg 7472 November 4, 2011 Texas Register
and operated by the applicant in Texas for at least the two years

immediately preceding the submission of a grant application to

be replaced under the program. The previous language only allowed vehicles that had been owned, registered, and operated

in Texas by the applicant for the preceding two years to be replaced under the program.

A change was made to THSC, §391.005(c), to revise the requirement that a vehicle funded under the program be operated in

the state by grant recipient for at least five years from the date

of reimbursement, to require that the vehicle be operated in the

state under the earlier of the fifth anniversary of the reimbursement date or until the date the vehicle has been in operation for

400,000 miles after the date of reimbursement.

THSC, §391.005(f), was revised to require the commission

to provide a means for an applicant to propose an alternative

method of complying with the vehicle or engine destruction

requirements of this subsection. The existing requirements include rendering the vehicle permanently inoperable by crushing

the vehicle or making a hole in the engine block and permanently destroying the frame of the vehicle.

Finally, a new THSC, §391.005(i), was added to require the executive director of the TCEQ to waive the requirements of THSC,

§301.004(b)(2)(A), upon a finding of good cause, which may include a waiver for short lapses in registration or operation attributable to economic conditions, seasonal work, or other circumstances. This subsection includes requirements that an applicant have owned, leased, or otherwise commercially financed,

registered, and operated the vehicle to be replaced in Texas for

at least two years immediately preceding the submission of a

grant application.

These proposed rules incorporate the changes to THSC, Chapter 391, under HB 3399.

Section by Section Discussion

§114.650, Definitions

Proposed revisions to §114.650(2) would amend the definition of

an "Eligible Entity" to reduce the number of vehicles in an entity’s

fleet that must be registered in Texas from 100 to 75 vehicles and

the number of vehicles in an entity’s fleet that must be eligible

for replacement from 25 to 20 vehicles as required under THSC,

§391.004.

§114.651, Applicability

Section 114.651(a) would be amended to reduce the number of

vehicles that must be included in an application from 25 to 20

vehicles, as required by THSC, §391.002(a).

In addition, proposed subsection (b) would allow an entity to participate in the program if that entity submits a grant application

for 20 or more qualifying vehicles, even if the commission denies

approval for one or more of the vehicles during the application

process, as required by THSC, §391.002(b).

§114.652, Qualifying Vehicles

Section 114.652(b) would be amended to incorporate changes

to the requirement for how long a grant-funded qualifying vehicle

must be owned, registered, and operated in Texas by a grant recipient. The ownership and use requirement would be changed

from a period at least five years from the date of reimbursement

of the grant-funded expenses, to until the earlier of the fifth anniversary of the date of reimbursement of the grant-funded expenses or until the date the vehicle has been in operation for

400,000 miles after the date of reimbursement. The amendment

is required by THSC, §391.005.

§114.653, Grant Eligibility

The proposed rule would amend §114.653(b) to incorporate

changes to the grant eligibility requirements to allow a vehicle

that has been leased or commercially financed by the applicant to be replaced under the program, as required by THSC,

§391.005.

The proposed rule would also amend §114.653 to add subsection (e) directing the executive director to waive the requirement

that a vehicle have been owned, leased, or commercially financed and registered and operated in Texas by the applicant

on a finding of good cause, as required by THSC, §391.005.

§114.654, Usage and Disposition

Section 114.654(b) would be amended to include specific criteria for how a vehicle replaced under the program must be rendered permanently inoperable and to direct the executive director to provide a means for an applicant to propose an alternative

method for rendering a vehicle inoperable, as required by THSC,

§391.005.

Under the specific criteria that would be added to subsection (b),

a vehicle or engine replaced under the program would need to

be rendered permanently inoperable by crushing the vehicle, by

making a hole in the engine block and permanently destroying

the frame of the vehicle, or by another method approved by the

executive director that permanently removes the vehicle from operation in this state. The executive director would be required to

provide a means for an applicant to propose an alternate method

for complying with these destruction requirements.

Fiscal Note: Costs to State and Local Government

Nina Chamness, Analyst, Strategic Planning and Assessment,

has determined that for the first five-year period the proposed

rules are in effect, no significant fiscal implications are anticipated for the agency as a result of administration or enforcement

of the proposed rules. The agency will implement the proposed

rules using currently available resources. Other units of state

or local government may experience cost benefits from the proposed rules if they qualify for grant funds to replace a diesel vehicle with a vehicle that qualifies for grant funding under the program in Account 5071 - Texas Emission Reduction Plan (TERP).

Appropriations for the program are an estimated $2.8 million in

each year of the 2012 - 2013 biennium.

The proposed rules would amend Chapter 114 per the requirements of HB 3399, to amend the criteria for the program. The

proposed rules will change the definition of an eligible entity. The

change in the definition will allow more entities statewide to apply for TERP funding by reducing the size of the fleet the entity

must have from 100 vehicles or more to 75 vehicles or more and

by reducing the number of vehicles eligible for replacement from

at least 25 to at least 20. The proposed rules also revise the required period of use for a qualifying vehicle to be the earliest of

the fifth anniversary of reimbursement or 400,000 miles instead

of at least five years. The proposed rules will also allow leased

or otherwise commercially financed vehicles to be eligible for replacement. The proposed rules also allow the executive director

to waive the two-year ownership or lease and registration requirements for the vehicle being replaced upon a finding of good

cause. The proposed rules also specify the method by which

a motor vehicle or engine must be destroyed while providing a

PROPOSED RULES November 4, 2011 36 TexReg 7473
means by which an applicant can propose an alternate method

of destruction.

State agencies or units of local government may experience cost

benefits from the proposed rules if they qualify for grant funds

to replace a light-duty or heavy-duty diesel vehicle with a vehicle that qualifies for grant funding under the program. The

proposed rules are expected to increase the number of eligible

grantees and replacement vehicles and motors. The program is

a statewide voluntary incentive program, and staff is not able to

determine how many state agencies or units of local government

would become eligible to apply for a grant at this time. Under current rules, an award from the program ranges from $15,000 to

$140,000 depending on the type of vehicle or motor replaced.

Public Benefits and Costs

Nina Chamness also determined that for each year of the first

five years the proposed rules are in effect, the public benefit anticipated from the changes seen in the proposed rules will be improved air quality in the state. The proposed rules are expected

to expand the universe of potential grantees and vehicles eligible for replacement.

The program is a voluntary statewide grant incentive program.

The proposed rules may not have a direct fiscal benefit for individuals, since it is unlikely that an individual would meet the

requirement that an applicant own and operate at least 75 vehicles in Texas. However, any eligible individual or entity should

experience the same cost savings as those experienced by a

local government or large business. Most eligible grantees are

expected to be governmental agencies or businesses that own

vehicle fleets.

The proposed rules are expected to increase the number of

businesses and the number of vehicles and motors that qualify

for a grant under the program. Costs for vehicles could range

from $30,000 for a light-duty vehicle to $180,000 or more

for a large heavy-duty truck. Currently, eligible grant awards

offsetting the replacement costs of these vehicles range from

$15,000 to $140,000. Under the proposed rules, grantees are

expected to experience similar cost savings. The grant program

is a voluntary program, and staff is not able to determine how

many state agencies or units of local government would become

eligible to apply for a grant at this time.

The proposed rules could increase revenue for sellers and

lessors of qualifying replacement vehicles and motors since

there should be more entities that qualify for grants and allow

them to purchase eligible vehicles and motors at a lower cost.

Small Business and Micro-Business Assessment

No adverse fiscal implications are anticipated for small or microbusinesses as a result of the proposed rules. If a small business

meets the eligibility requirements, it should experience the same

type of cost savings or increased revenue as a large business.

Currently, eligible grant awards offsetting the replacement costs

of eligible vehicles range from $15,000 to $140,000.

Small Business Regulatory Flexibility Analysis

The commission has reviewed this proposed rulemaking and determined that a small business regulatory flexibility analysis is not

required because the proposed rules do not adversely affect a

small or micro-business in a material way for the first five years

that the proposed rules are in effect.

Local Employment Impact Statement

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

proposed rules are in effect.

Draft Regulatory Impact Analysis Determination

The commission reviewed the rulemaking in light of the regulatory analysis requirements of Texas Government Code,

§2001.0225, and determined that this rule action is not subject

to Texas Government Code, §2001.0225, because it does not

meet the definition of a "major environmental rule" as defined

in that statute. A "major environmental rule" means a rule the

specific intent of which is to protect the environment or reduce

risks to human health from environmental exposure and that

may adversely affect in a material way the economy, productivity, competition, jobs, the environment, or the public health and

safety of the state or a sector of the state.

The amended Chapter 114 rules are proposed in accordance

with HB 3399, which amended THSC, Chapter 391. The program offers financial incentives for the voluntary replacement of

diesel engines. Because the proposed rules place no involuntary

requirements on the regulated community, the proposed rules

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

of the economy, productivity, competition, jobs, the environment,

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

Also, none of the proposed amendments place additional financial burdens on the regulated community.

In addition, a regulatory impact analysis is not required because

the proposed rules do not meet any of the four applicability criteria for requiring a regulatory analysis of a "major environmental

rule" as defined in the Texas Government Code. Texas Government Code, §2001.0225, applies only to a major environmental

rule the result of which is to: 1) exceed a standard set by federal law, unless the rule is specifically required by state law; 2)

exceed an express requirement of state law, unless the rule is

specifically required by federal law; 3) exceed a requirement of

a delegation agreement or contract between the state and an

agency or representative of the federal government to implement

a state and federal program; or 4) adopt a rule solely under the

general powers of the agency instead of under a specific state

law. This rulemaking does not exceed a standard set by federal

law. In addition, this rulemaking does not exceed an express

requirement of state law and is not proposed solely under the

general powers of the agency, but is specifically authorized by

the provisions cited in the Statutory Authority section of this preamble. Finally, this rulemaking does not exceed a requirement

of a delegation agreement or contract to implement a state and

federal program.

The commission invites public comment on the draft regulatory

impact analysis determination. Written comments on the draft

regulatory impact analysis determination may be submitted to

the contact person at the address listed under the Submittal of

Comments section of this preamble.

Takings Impact Assessment

The commission evaluated this rulemaking action and performed an analysis of whether the proposed rules are subject to

Texas Government Code, Chapter 2007. The primary purpose

of the rulemaking is to amend Chapter 114 in accordance with

HB 3399. The rules amend the criteria for implementing a

voluntary program and only affect motor vehicles which are not

considered to be private real property. The promulgation and

36 TexReg 7474 November 4, 2011 Texas Register
enforcement of the proposed rules is neither a statutory nor

a constitutional taking because it does not affect private real

property. Therefore, the rules do not constitute a taking under

Texas Government Code, Chapter 2007.

Consistency with the Coastal Management Program

The commission reviewed the proposed rulemaking and found

the proposal is a rulemaking identified in the Coastal Coordination Act Implementation Rules, 31 TAC §505.11(b)(2), concerning rules subject to the Texas Coastal Management Program

(CMP), and will, therefore, require that goals and policies of the

CMP be considered during the rulemaking process. The commission reviewed this action for consistency and determined the

rulemaking for Chapter 114 does not impact any CMP goals or

policies, because it amends a voluntary incentive grant program

and does not govern air pollution emissions.

Written comments on the consistency of this rulemaking may be

submitted to the contact person at the address listed under the

Submittal of Comments section of this preamble.

Announcement of Hearing

The commission will hold a public hearing on this proposal in

Austin on November 29, 2011, at 10:00 a.m. in Building E, Room

201S, at the commission’s central office located at 12100 Park

35 Circle. The hearing is structured for the receipt of oral or written comments by interested persons. Individuals may present

oral statements when called upon in order of registration. Open

discussion will not be permitted during the hearing; however,

commission staff members will be available to discuss the proposal 30 minutes prior to the hearing.

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

Sandy Wong, Office of Legal Services, at (512) 239-1802. Requests should be made as far in advance as possible.

Submittal of Comments

Written comments may be submitted to Charlotte Horn, MC

205, Office of Legal Services, Texas Commission on Environmental Quality, P.O. Box 13087, Austin, Texas 78711-3087,

or faxed to (512) 239-4808. Electronic comments may be

submitted at: http://www5.tceq.texas.gov/rules/ecomments/.

File size restrictions may apply to comments being submitted

via the eComments system. All comments should reference

Rule Project Number 2011-051-114-EN. The comment period

closes December 5, 2011. Copies of the proposed rulemaking can be obtained from the commission’s Web site at

http://www.tceq.texas.gov/nav/rules/propose_adopt.html. For

further information, please contact Stephen Dayton, Implementation Grants Section, (512) 239-6824.

Statutory Authority

The amendments are proposed under Texas Water Code (TWC),

§5.102, which provides the commission with the general powers

to carry out its duties under the TWC; TWC, §5.103, which authorizes the commission to adopt any rules necessary to carry

out the powers and duties under the provisions of the TWC and

other laws of this state; and TWC, §5.105, which authorizes the

commission by rule to establish and approve all general policy of the commission. These amendments are also proposed

under Texas Health and Safety Code (THSC), Texas Clean Air

Act, §382.017, which authorizes the commission to adopt rules

consistent with the policy and purposes of the THSC; THSC,

§382.011, which authorizes the commission to establish the level

of quality to be maintained in the state’s air and to control the

quality of the state’s air; and THSC, §382.012, which authorizes

the commission to prepare and develop a general, comprehensive plan for the control of the state’s air. Finally, these amendments are proposed under THSC, Chapter 391, and are part of

the implementation of House Bill 3399.

The proposed amendments implement THSC, §§391.002,

391.004, and 391.005.

§114.650. Definitions.

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

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

meanings commonly ascribed to them in the field of air pollution control. In addition to the terms that are defined by the TCAA and §§3.2,

101.1, and 114.1 of this title (relating to Definitions), the following

words and terms, when used in this division will have the following

meanings, 

(1) Alternative fuel--A fuel, other than gasoline or diesel

fuel. When used in this division, this definition is limited to the following: electricity, compressed natural gas, liquefied natural gas, hydrogen, propane, or a mixture of fuels containing at least 85% methanol

by volume.

(2) Eligible entity--Any person or entity with a fleet of 75

[100] or more vehicles that:

(A) are registered in Texas; and

(B) include at least 20 [25] vehicles that are eligible for

replacement.

(3) Golf cart--A motor vehicle designed by the manufacunless the context clearly indicates otherwise.

turer primarily for transporting persons on a golf course.

(4) Heavy-duty vehicle--A motor vehicle with a gross vehicle weight rating greater than 8,500 pounds and containing an engine certified to the United States Environmental Protection Agency’s

heavy-duty engine standards.

(5) Hybrid vehicle--A motor vehicle with at least two different energy converters and two different energy storage systems on

board the vehicle for the purpose of propelling the vehicle.

(6) Light-duty motor vehicle--A motor vehicle with a gross

vehicle weight rating of less than 10,000 pounds and certified to the

United States Environmental Protection Agency’s light-duty vehicle

emission standards.

(7) Motor vehicle--A self-propelled device designed for

transporting persons or property on a public highway that is required

to be registered under Texas Transportation Code, Chapter 502.

(8) Neighborhood electric vehicle--A motor vehicle that:

(A) is originally manufactured to meet, and does meet,

the equipment requirements and safety standards established for "lowspeed vehicles" in Federal Motor Vehicle Safety Standard No. 500 (49

Code of Federal Regulations §571.500);

(B) is a slow-moving vehicle, as defined by Texas

Transportation Code, §547.001 that is able to attain a speed of more

than 20 miles per hour but not more than 25 miles per hour in one mile

on a paved, level surface;

(C) is a four-wheeled motor vehicle;

(D) is powered by electricity or alternative power

sources;

(E) has a gross vehicle weight rating of less than 3,000

pounds; and

PROPOSED RULES November 4, 2011 36 TexReg 7475
ƇƇƇ

(F) is not a golf cart.

(9) Program--The Texas Clean Fleet Program established

under this division.

§114.651. Applicability.

(a) Any eligible entity that will replace 20 [25] or more onroad diesel vehicles within a twelve-month period with qualifying vehicles may apply for a grant under the Texas Clean Fleet Program to

offset the cost of replacing those vehicles with alternative fuel or hybrid vehicles.

(b) Notwithstanding subsection (a) of this section, an entity

that submits a grant application for 20 or more qualifying vehicles is

eligible to participate in the program even if the commission denies

approval for one or more of the vehicles during the application process.

(c) [(b)] The commission may allow a regional planning commission, council of governments, or similar regional planning agency

created under Local Government Code, Chapter 391, or a private nonprofit organization to apply for and receive a grant to improve the ability of the program to achieve its goals.

§114.652. Qualifying Vehicles.

(a) A qualifying vehicle is one that:

(1) is certified to current federal emissions standards;

(2) replaces a diesel-powered on-road vehicle of the same

weight classification and use; and

(3) is a hybrid vehicle or fueled by an alternative fuel.

(b) As a condition of receiving a grant the qualifying vehicle must be continuously owned, registered, and operated in Texas by

the grant recipient until the earlier of the fifth anniversary of [for at

least five years from] the date of reimbursement of the grant-funded

expenses or until the date the vehicle has been in operation for 400,000

miles after the date of reimbursement.

(c) A vehicle is not a qualifying vehicle if it:

(1) is a neighborhood electric vehicle;

(2) has been used as a qualifying vehicle to qualify for a

grant under this division for a previous reporting period or by another

entity; or

(3) has qualified for a similar grant or tax credit in another

jurisdiction.

§114.653. Grant Eligibility.

(a) To be eligible for a grant under the program a project must

result in a reduction in emissions of nitrogen oxides of at least 25%,

based on:

(1) the baseline emission level set by the executive director; and

(2) the certified emission rate of the new vehicle or engine.

(b) The vehicle being replaced must:

(1) be an on-road vehicle that has been owned, leased, or

otherwise commercially financed, and registered[,] and operated by the

applicant in Texas for at least the two years immediately preceding the

submission of a grant application;

(2) satisfy any minimum average annual mileage or fuel

usage requirements established by the executive director;

(3) satisfy any minimum percentage of annual usage requirements established by the executive director; and

(4) be in operating condition with at least two years of remaining useful life, as determined in accordance with criteria established by the executive director.

(c) At the discretion of the executive director, projects that result in a 25% reduction in other pollutants may be considered eligible

for funding under this program.

(d) The executive director may establish additional criteria for

purposes of prioritizing projects for selection. Such criteria may include, but are not limited to:

(1) nonattainment status of the primary location in which

the eligible vehicles are used; or

(2) cost per ton benefits of the overall emissions being reduced.

(e) The executive director shall waive the requirements of sub

section (b)(1) of this section on a finding of good cause, which may in

clude a waiver for short lapses in registration or operation attributable

to economic conditions, seasonal work, or other circumstances.

§114.654. Usage and Disposition.

(a) Not less than 75% of the annual use of the qualifying vehicle, either mileage or fuel use as determined by the executive director,

must occur in Texas.

(b) A vehicle or engine replaced under this program must be

rendered permanently inoperable by crushing the vehicle, by making

a hole in the engine block and permanently destroying the frame of

the vehicle, or by another method approved by the executive director

that permanently removes the vehicle from operation in this state [in

accordance with criteria established by the executive director]. The

executive director shall provide a means for an applicant to propose an

alternative method for complying with the requirements of this subsec

tion.

This agency hereby certifies that the proposal has been reviewed

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

Filed with the Office of the Secretary of State on October 21,

2011.

TRD-201104482

Robert Martinez

Director, Environmental Law Division

Texas Commission on Environmental Quality

Earliest possible date of adoption: December 4, 2011

For further information, please call: (512) 239-0779

-

-

-

DIVISION 6. ALTERNATIVE FUELING

FACILITIES PROGRAM

30 TAC §§114.660 - 114.662

The Texas Commission on Environmental Quality (commission

or agency) proposes new §§114.660 - 114.662.

If adopted, the new sections will be submitted to the United

States Environmental Protection Agency (EPA) as revisions to

the state implementation plan.

Background and Summary of the Factual Basis for the Proposed

Rules

36 TexReg 7476 November 4, 2011 Texas Register
TESTIMONY 
Reference Number 

W-1 

W-2 

W-3 

W-4 

W-5 

INDEX OF WRITTEN TESTIMONY 

Submitted by 

Todd R. Campbell, on behalf of Clean Energy 

Matt Schrap, Crossroads Equipment Lease & Finance, LLC 

Lynn Lyon, on behalf of Pioneer Natural Resources USA, Inc. 

Danny Smith, UPS 

Guy Donaldson, United States Environmental Protection Agency 
Clean 

~ Energy· 

3020 Old Ranch Parkway. Suite 400 

Seal Beach, California 90740 USA 

562.493.2804 fax: 562.493.4956 

www.cleanenergyfuels.com 

Charlotte Hom 

MC 205, Office ofLegal Services 

November 30, 2011 

Texas Commission on Environmental Quality 

P.O. Box 13087 

Austin, Texas 78711-3087 

W-1 

Todd R. Campbell, MEM, MPP 

Vice President. Public Policy and Regulatory Affairs 

Re: Diesel Emissions Reduction Incentive Program Rulemaking 

Rule Project Number 2011-050-114-EN 

Rule Project Number 2011-051-114-EN 

Dear Ms. Hom: 

On behalf of Clean Energy, we appreciate this opportunity to file comments on the 

Texas Commission on Environmental Quality's (''TCEQ") proposed rule changes to 30 

Texas Administrative Code Chapter 114 to implement Section 386.104 and Chapter 391 

of the Texas Health & Safety Code, which was amended by the 82nd Legislature 

through House Bill 3399. 

Clean Energy is the leading provider of natural gas {compressed natural gas (CNG) and 

liquefied natural gas (LNG)) for transportation in North America. The company has a 

broad customer base in the refuse, transit, ports, shuttle, taxi, trucking, airport, and 

municipal fleet markets, fueling more than 17,200 vehicles daily at over 190 strategic 

locations across the United States and Canada. Clean Energy was supportive of the 

Texas Legislature's initiative to pass HB 3399 to incorporate changes and additions to 

the Diesel Emission Reduction Incentive Program and Clean Fleet Program. 

TCEQ staff is to be commended for the hard work and effort they have put into 

developing the these programs and these rules. We look forward to the successful 

implementation of these rules. 

The proposed rulemakings in response to HB 3399 make several administrative changes 

to TERP and Clean Fleet to make these programs work more effectively and efficiently 

for Texas-based fleets. The current application procedures are onerous and create a 

barrier for many fleets to apply. By simplifying the permitting process, fleet operators 

will be able to compete for grant funding, resulting in cost-effective emissions 

reductions. Furthermore, the rulemakings would simplify the paperwork required for 

Clean Fleet applications. Finally, the rulemakings provide that the Executive Director 

1 

North America's leader In clean transportation 
~~ Clean Energy 

shall waive the eligibility requirements when good cause is shown. In other words, 

these rulemakings allow the TCEQ to grant a waiver of the eligibility requirements in 

cases where the purposes of the program would be met- where the TCEQ can certify 

that emissions reductions will be achieved and where the purposes of the program 

would be furthered. 

Clean Energy fully supports TCEQ's rulemaking. 

2 

North America's leader in dean transportation 

Respectfully, 

~~~a>t::__ 

Todd R. Campbell 

Vice President 

Public Policy and 

Regulatory Affairs 

Clean Energy Fuels 
November 29, 2011 

To: Mark R. Vickery, P.O., Executive Director, TCEQ 

From: Matt Schrap, Crossroads Equipment Lease and Finance & Crossroads Fleet Service (CFS) 

Re: Rule Project No. 20 11-051-114-EN 

Dear Mr. Vickery, 

This letter is in regard to the proposed subsection changes under Texas Health and Safety Code 

(THSC) §391.000: Texas Clean Fleet, Rule Project Number 2011-051-114-EN. 

Crossroads Equipment Lease and Finance is a direct lending company specializing in 

transportation finance. Although based in California, Crossroads is national in scope with clients 

throughout the USA. 

The main focus of our company is in assisting heavy duty truck operators secure zero cost grant 

assistance and fmancing towards the purchase or lease of new and used commercial vehicles. 

These vehicles meet the cleanest federal Environmental Protection Agency (EPA) engine 

standards across all commercial fuel platforms for large and small fleets. 

To help fleet owners access funding, Crossroads created California Fleet Solutions (CFS) in 

2010 to help California fleets apply for equipment funding thfough various grant programs 

available in California. CFS has been successful in securing millions of dollars in grant funding 

for California fleets with zero up-front costs or commitments from the applicant. 

In 2011, Crossroads created another division towards this end. Crossroads Fleet Service (CFS) is 

using expertise gained through our no cost grant securement process in order to help trucking 

fleets large and small, across the United States secure funding towards the purchase of new clean 

equipment. We actively pursue grant opportunities and have been very successful in promoting 

outreach and providing residual financing for remaining costs in the truck purchase after the 

grant. 

One reason for our continued success is our experience in administration of government finance 

programs directed at truck users who have received a grant for the purchase of clean equipment. 

Crossroads was instrumental in assisting the Ports of Los Angeles and Long Beach (Ports) in 

achieving their funding goals under their Clean Air Action Plan (CAAP). One hundred percent 

of the trucks that received funding through the Ports grant program were financed by Crossroads. 

The Port Finance Acceptance Company (PF AC) was created specifically through a partnership 

between Crossroads and Daimler Trucks North American (DTNA) and is still in existence today. 

Crossroads is also the administrator for the California Air Resources Board (CARB) Direct Loan 

(DL} Program and is the number one lending entity in the California Capital Access Program 

(CalCAP) administered through the California State Treasurer's Office. 
Both the Ports and the CARB DL programs were put out to competitive bid in a Request for 

Proposals (RFP) process. Crossroads was awarded these contracts due to our specific knowledge 

of the trucking industry and our commitment to providing no cost funding assistance to fleets 

Through our program administration we have gained a firsthand look into the challenges that 

large motor carriers and small fleets alike face in this market. We are an active member of the 

indru;try and maintain membership as a Smart Way Transport Affiliate Partner, as well as in the 

American Trucking Association (ATA) the California Trucking Association (CTA) and the 

Texas Motor Transport Association (TMTA). 

Crossroads and CFS are no strangers when it comes to the trucking industry and grant program 

administration and distribution. Along those lines, this letter is to commend the TCEQ for taking 

an active leadership role throughout this guideline modification process. 

The suggested changes demonstrate TCEQ's acknowledgement of potential challenges entities 

face when soliciting applicants for funding . .Fleets throughout the covered areas in Texas will 

greatly benefit from the subsection changes you have proposed in the Texas Clean .Fleets 

Program Rules. 

Crossroads is looking forward to assisting fleet operators secure TERP grants through the TCEQ, 

and readily offer ourselves as a unique resource throughout the process. 

Please feel free to contact our offices at the infonnation below. 

Thank you for taking time to read our comments. 

Sincerely, 

Matt Schrap, President, CFS 

Crossroads Equipment Lease & Finance 

9121 Haven Ave. Ste. 270 

Rancho Cucamonga, CA 91730 

.................. ···-·-·------
PIONEER W-3 

NATURAL RESOURCES 

Pioneer Natural Resources USA, Inc. 

5205 N. O'Connor Blvd., Suite 200 

Irving, TX 75039-3746 

Charlotte Horn 

MC 205, Office of Legal Services 

Texas Commission on Envirorunental Quality 

P.O. Box 13087 

Austin, Texas 78711-3087 

Tel: (972) 444-9001 

November 30, 2011 

Re: Diesel Emissions Reduction Incentive Program Ru1emaking 

Rule Project Number 2011-050-114-EN 

Rule Project Number 2011-051-114-EN 

Dear Ms. Horn: 

On behalf of Pioneer Natural Resources ("Pioneer") we appreciate this opportunity to file 

comments on the Texas Commission on Envirorunental Quality's ("TCEQ") proposed 

rule changes to 30 Texas Administrative Code Chapter 114 to implement Section 

386.104 and Chapter 391 ofthe Texas Health & Safety Code, which was amended by the 

82nd Legislature through House Bill 3399. 

Pioneer is one of the most active oil and gas drillers in Texas, with operations in the 

Permian Basin, Barnet Shale, and Eagle Ford Shale. In particular, Pioneer is the largest 

acreage holder, driller and producer in the Spraberry Field, which covers nine counties in 

West Texas. Overall, Pioneer produces roughly 115,000 barrels of oil equivalent per day, 

operates over 9,200 producing wells, and employs over 2,200 workers. Pioneer was 

supportive of the Texas Legislature's initiative to pass HB 3399 to incorporate changes 

and additions to the Diesel Emission Reduction Incentive Program and Clean Fleet 

Program. 

TCEQ staff is to be commended for the hard work and effort they have put into 

developing the these programs and these rules. We look forward to the successful 

implementation of these rules. 

The proposed rulemakings in response to HB 3399 make several administrative changes 

to TERP and Clean Fleet to make these programs work more effectively and efficiently 

for Texas-based fleets. The current application procedures are onerous and create a 

barrier for many fleets to apply. By simplifying the permitting process, fleet operators 

will be able to compete for grant funding, resulting in cost-effective emissions reductions. 
[Recipient Name] 

November 30, 2011 

Page2 

Furthennore, the ru1emakings would simplify the paperwork required for Clean Fleet 

applications. Finally, the ru1emakings provide that the Executive Director shall waive the 

eligibility requirements when good cause is shown. In other words, these rulemakings 

allow the TCEQ to grant a waiver of the eligibility requirements in cases where the 

purposes of the program would be met - where the TCEQ can certify that emissions 

reductions will be achieved and where the purposes of the program would be furthered. 

Pioneer fully supports TCEQ's rulemaking. 

Respectfully, 

Lynn Lyon 

Manager of Strategic Projects 

Domestic Operations 

Pioneer Natural Resources 
660 Fritz Drive 

Coppell, TX 75019 

November 15, 2011 

Steve Dayton 

Rule Project Manager 

Texas Commission on Environmental Quality 

12100 Park 35 Circle 

Austin, Texas 78711-3087 

Dear Mr. Dayton: 

W-4 

UPS appreciates the opportunity to comment on the proposed rules 

for the Diesel Emissions Reduction Incentive Program, the Texas 

Clean Fleet Program, the Alternative Fueling Facilities Program and 

the Texas Natural Gas Vehicle Grant Program. The Texas 

Legislature has recognized and acted on the need for alternative 

. fueled vehicles to reduce harmful emissions in our major cities, 

decrease our dependency on foreign oil, and to take advantage of 

Texas' resources, particularly natural gas. 

UPS is a leader in the use of alternative fuel vehicles, with over 1,347 

alternative fuel/technology vehicles nationwide and 1,914 worldwide. 

We are committed to increasing the number of such vehicles in Texas, 

and have made that commitment known to the leadership of the state 

in public testimony. 

UPS has enjoyed our partnership with TCEQ through our 

participation in the Clean Fleet Program, passed in the 2009 session. 

As you know, UPS received funding through the program to purchase 

55 hybrid electric vehicles and has deployed them in the Houston and 

Austin areas. 

UPS has reviewed the proposed rules for Docket Numbers 2011-

1219-RUL, 2011-1220-RUL, 2011-1221-RUL and 2011-1222-RUL. 
We have no suggested changes to the proposed rules and believe 

these proposed rules will assist in making the existing Clean Fleet 

Program function as smoothly and efficiently as possible as well as 

get the new programs for natural gas facilities and vehicles up and 

running quickly. 

We will continue to provide input to TCEQ as the ·agency moves to 

adopt rules for these programs and will be ready to apply for funding 

once the rules have been approved and the application process has 

begun. It is UPS' intention to apply for funding for both facilities and 

vehicles under the existing Clean Fleet program and the new natural 

gas program. 

We look forward to continuing to work together to make Texas's air 

the cleanest it can be. Should you need any further information 

regarding UPS's ability to commit to these programs, please don't 

hesitate to contact me. 

Sincerely, 

DannySmi h 

Vice President State Government Affairs 

660 Fritz Drive 

Coppell, Texas 75019 

972-304-6500 
Ms. Charlotte Horn 

UNITED STATES ENVIRONMENTAL PROTECTION AGENCY 

REGIONS 

1445 ROSS AVENUE, SUITE 1200 

DALLAS TX 75202-2733 

DEC 5 2011 

Texas Commission on Environmental Quality 

P.O. Box 13087 

Austin, TX 78711-3087 

Re: Rule Project Number 20 11-051-114-EN 

Dear Ms. Horn: 

W-5 

Thank you for the opportunity to review and comment on proposed revisions to 30 T AC Chapter 114, 

Control of Air Pollution from Motor Vehicles, and corresponding revisions to the state implementation 

plan (SIP). The proposed revisions will amend Chapter 114, Subchapter K, Mobile Source Incentive 

Programs, Division 5, Texas Clean Fleet Program, to implement changes made to the Texas Health and 

Safety Code (THSC), Chapter 391, by Texas House Bi113399, sznd Legislature,2011. The proposed 

changes and additions involve the number of vehicles that must be registeredand operated in Texas by an 

eligible grant applicant, the number of vehicles that must be replaced under a grant, the period of 

commitment by a grant recipient for use of the grant-funded vehicles, requirements on the ownership or 

lease of the vehicles being replaced, and the destruction requirements for the vehicles and engines being 

replaced. 

The Environmental Protection Agency (EPA) appreciates the efforts ofthe Texas Commission on 

Environmental Quality (TCEQ) to continually improve and expand mobile source incentive programs. 

However, the EPA is concerned with the proposed revision that amends § 114.653, Grant Eligibility, by 

adding subsection (e) \Vhich states "the executive director shall waive the requirements of subsections 

(b)(l) ofthis section on a finding of good cause, which may include a waiver for short lapses in 

registration or operation attributable to economic conditions, seasonal work, or other circumstances." The 

EPA recommends that you remove the phrase "or other circumstances" from subsection (e) of§ 114.653 

since it is not well defined. 

The EPA Region 6 continues to applaud the TCEQ's efforts to continually improve mobile source 

incentive programs, and we offer our support during the rule revision process. If you have any questions 

or need additional clarification, please contact Mr. John Walser of my staff at 214-665·7128. Please let us 

know how we may be of further assistance. · 

Sincerely yours, 

Guy Donaldson 

Chief 

Air Planning Section 

Internet Address {URL) • http://www.epa.gov/region6 

Recycled/Recyclable • Printed with Vegetable Oil Based Inks on 100% Recycled Paper, Process Chlorine Free 
INDEX OF ORAL TESTIMONY 

NO ORAL TESTIMONYW AS RECEIVED PERTAINING TO THIS RULE REVISION. 
Texas Commission on Environmental Quality 

Public Hearing Registration 

November 29, 2011 

1o:ooa.m. 

Rule Project Nos.: 2011-050-114-EN, 2011-051-114-EN, 2011-052-114-EN, 2011-053-114-EN 

- 1 -

Short Title: HB 3399: Emissions Reduction Incentive Program Rules; HB 3399: Texas Clean Fleet Program Rules; SB 385: Alternative Fueling 

Facilities Program Rule; SB 385: Texas Natural Gas Vehicle Grant Program 

Location: TCEQ main complex, 12100 Park 35 Circle, Building E, Room 201S, Austin, Texas 

Concerning: Amendments to 30 TAC Chapter 114 

Name 

(Please Print) Representing Presenting Oral Testimony? 

(Circle One) 

Yes® 

Yes<.@ 

Yes{!i) 

Yes@ 

Yes~ 

Yes~ 

Yes 

Yes €~ 
-2-

Texas Commission on Environmental Quality 

Public Hearing Registration 

November 29, 2011 . . 1o:ooa.m . 

. Rule Project Nos.: 2011-050-114-EN, 2011-051-114-EN, 2011-052-114-EN, 2011-053-114,.EN 

Short Title: HB 3399: Emissions Reduction Incentive Program Rules; HB 3399: Texas Clean Fleet Program Rules; SB 385: Alternative Fueling 

Facilities Program Rule; SB 385: Texas Natural Gas Vehicle Grant Program 

Location: TCEQ main complex, 12100 Park 35 Circle, Building E, Room 201S, Austin, Texas 

Concerning: Amendments to 30 TAC Chapter 114 

Name Representing Presenting Otal Testimony? 

(Please Print) (Circle One) 

:r:'t ~ {d {)fJ.5 Yes~ 

1)~1)'-f :;~1 tL L-tPS Yes-® 

e:, , 

c 1--l Jtf2 j) e'7(J_ Cf-/ f-1 fo / .u T {t1J &c; VJ Yes ~ 

C' M f J c~~v\~l~ ~ M vlQ_. [(. o . tv'Vt 

- / fl'1_ Yes ~ 

- I u J{ 

I rtRun~Y\ \-\D \ \oX"- t::sr\~ ~~C\_( L LC:':. Yes rN..i) 

'0 

Yes No 

Yes No 

Yes No 
HEARING OFFICER REPORT 

I am the hearing officer assigned to conduct the public hearing regarding: 

The TCEQ proposal to amend Chapter 114, Subchapter K, Division 3, Diesel Emissions 

Reduction Incentive Program for On-Road and Non-Road Vehicles, to implement 

changes made to Texas Health and Safety Code, Chapter 386, Subchapter C, Diesel 

Emissions Reduction Incentive Program, by House Bill 3399, 82nd Legislature, 2011. 

The proposed changes and additions involve criteria for the use of grant-funded vehicles 

a:J;J.d engines, destruction of vehicles and engines replaced under the program, ownership 

or lease of vehicles to be replaced under the program, and waiver of certain eligibility 

requirements by the executive director. (Rule Project Number 2011-050-114-EN); 

The TCEQ proposal to amend Chapter 114, Subchapter K, Division 5, Texas Clean Fleet 

Program, to implement changes made to Texas Health and Safety Code, Chapter 391, 

Texas Clean F1eet Program, by House Bill 3399, 82nd Legislature, 2011. The proposed 

changes and additions involve the number of vehicles that must be registered and 

operated in Texas by an eligible grant applicant, the number of vehicles that must be 

replaced under a grant, the period of commitment by a grant recipient for use of the 

grant-funded vehicles, requirements on the ownership or lease of the vehicles being 

replaced, and the destruction requirements for the vehicles and engines being replaced. 

(Rule Project Number 2011.-051-114-EN); 

The TCEQ proposal to amend Chapter 114, Subchapter K, to add a new Division 6, 

Alternative Fueling Facilities Program. The proposed rulemaking would implement a 

portion of Senate Bill 385, 82nd Legislature, 2011, by adding the criteria that may be 

used by the executive director for prioritizing facilities eligible to receive grants under 

the Alternative Fueling Facilities Program, established under Texas Health and Safety 

Code, Chapter 393. (Rule Project Number 2011-052-114-EN); 

The TCEQ proposal to amend Chapter 114, Subchapter K, to add a new Division 7, Texas 

Natural Gas Vehicle Grant Program. The proposed rule making would implement a 

portion of Senate Bill 385, 82nd Legislature, 2011, by adding the criteria that may be 

used by the executive director for prioritizing qualifying vehicles eligible to receive grants 

under the Texas Natural Gas Vehicle Grant Program, established under Texas Health 

and Safety Code, Chapter 394· (Rule Project Number 2011-053-114-EN). 

A public hearing was scheduled for November 29, 2011, at 10:00 a.m., in Austin in 

Building E, Room 201S, at the commission's central office located at 12100 Park 35 

Circle. 

Hearing Officer 1 

Date signed 
BEFORE THE TEXAS COMMISSION 

ON ENVIRONMENTAL QUALITY 

Public Meeting for Title 30, ) 

Texas Administrative Code Chapter 114, ) 

Control of Air Pollution for Motor Vehicles 

Room 201S, Building E 

TCEQ Complex 

12100 Park 35 Circle 

Austin, Texas 

Tuesday, 

November 29, 2011 

The above-entitled matter came on for 

hearing, pursuant to notice, at 10:00 a.m. 

BEFORE: 

Bruce McAnally - General Law Division 

Charlotte Horn - General Law Division 

Steve Dayton - Air Quality Division 
TCEQ - Public Hearing - 11/29/2011 

1 PROCEEDINGS 

2 (10:01 a.m.) 

3 BRUCE McANALLY: Good morning, and thank you 

4 for coming to this Texas Commission on Environmental 

5 Quality combined public hearing for four separate 

6 proposed rules. My name's Bruce McAnally. I'm with the 

7 TCEQ General Law Division. With me also is Charlotte 

8 Horn, also with the TCEQ Law Division, Steve Dayton with 

9 the TCEQ Air Quality Division. Steve is a project 

10 manager for all four of the rule projects TCEQ will 

11 receive comments on today. And Betsy Peticolas is the 

12 TCEQ staff attorney assigned to all four of today's rule 

13 projects: 

14 Rule Project Number 2011-050-114-EN 

15 regarding the Emissions Reduction Incentive Program 

16 Rules outlined in House Bill 3399 from the 82nd 

17 Legislature. Rule Project Number 2011-051-114-EN 

18 pertaining to Texas Clean Fleet Program Rules specified 

19 in House Bill 3399 of the 82nd Legislature. Rule 

20 Project Number 2011-052-114-EN for Senate Bill 385 for 

21 the 82nd legislature regarding the Alternative Fuels 

22 Facility Program Rule. And Rule Project Number 

23 2011-053-114-EN for Senate Bill 385 of the 82nd 

24 Legislature dealing with the Texas Natural Gas Vehicle 

25 Grant Program. 

Integrity Legal Support Solutions 

www.integrity-texas.com 

2 
TCEQ - Public Hearing - 11/29/2011 

1 TCEQ staff are present this morning to 

2 receive oral or written comments on the proposed 

3 revisions to 30 Texas Administrative Code, Chapter 114 

4 concerning Control of Air Pollution for Motor Vehicles. 

5 If you'd like to present oral testimony today and have 

6 not signed in at the registration table, please do so 

7 now. 

8 If you're not familiar with the proposed 

9 changes, copies of the proposals as published in the 

10 Texas Register are available at the registration table. 

11 There are also copies of the hearing notice. So if 

12 anyone would like to submit written comments, you can 

13 find the information on where to fax or mail your 

14 written comments or submit on the internet via the TCEQ 

15 eComments system. 

16 The TCEQ will continue to accept written 

17 comments on these proposals until December 5, 2011. 

18 This hearing is structured strictly for the receipt of 

19 oral or written comments. Open discussion during the 

20 hearing is not allowed. However, if you should you have 

21 any additional questions or comments regarding these 

22 proposals, there will be an opportunity after the 

23 hearing to have your questions answered by TCEQ staff 

24 one on one. 

25 Now, at this time·no one has specified on 

Integrity Legal Support Solutions 

www.integrity-texas.com 

3 
TCEQ - Public Hearing - 11/29/2011 

1 registration they would like to speak. So anybody have 

2 anything -- any chance? Okay. Seeing that no one has 

3 requested to make a comment, once again, the TCEQ will 

4 continue to accept written comments on the proposed 

5 revisions to Texas Administrative Code, Chapter 114 

6 concerning the Control of Air Pollution from Motor 

7 Vehicles regarding TCEQ Project Numbers 2011-050, 

8 2011-051, 2011-052 and 2011-053 until December 5, 2011. 

9 And if we have no request to make comments, 

10 our hearing is closed. Thank y'all for coming. 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

. 21 

22 

23 

24 

25 

(Hearing concluded, 10:05 a.m.) 

Integrity Legal Support Solutions 

www.integrity-texas.com 

4 
TCEQ - Public Hearing - 11/29/2011 

1 C E R T I F I C A T E 

2 

3 IN RE: Public Meeting for Title 30, Texas 

4 Administrative Code Chapter 114, Control of Air 

5 Pollution for Motor Vehicles. 

6 LOCATION: Austin, Texas 

7 Date: November 29, 2011 

8 

9 I, Joy N. Quiroz-Hernandez, Certified 

10 Shorthand Reporter Number 8391 for The State of Texas, 

11 do hereby certify that I did, in computerized stenotype 

12 shorthand, transcribe proceedings in the above-entitled 

13 matter to the best of my ability and hearing, 

14 proceedings before the Texas Commission on Environmental 

15 Quality and that the above and foregoing pages contain a 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

full and correct computer-assisted transcription of my 

computerized stenotype shorthand notes. 

Joy N. Quiroz-Hernandez, CSR 

CSR No. 8391 - Expires 12/31/11 

Integrity Legal Support Solutions 

Firm Registration No. 528 

3100 W. Slaughter Lane, Suite A-101 

Austin, Texas 78748 

(512) 320-8690 

(512) 320-8692 (Fax) 

Integrity Legal Support Solutions 

www.integrity-texas.com 

5 
EVALUATION 
Texas Commission on Environmental Quality 

Interoffice Memorandum 

To: Commissioners Date: March 9, 2012 

Thru: Bridget Bohac, Chief Clerk 

Mark R. Vicke:ry, P.G., Executive Director 

From: Susana M. Hildebrand, P .E., Chief Engineer (j!j 

Docket No.: 2011-1220-RUL 

Subject: Commission Approval for Rulemaldng Adoption 

Chapter 114, Control of Air Pollution from Motor Vehicles 

HB 3399: Texas Clean Fleet Program Rules 

Ru1e Project No. 2011-051-114-EN 

Background and reason(s) for the rulemaking: 

House Bill (HB) 3399, 82nd Legislature, 2011, Regular Session, by Representatives Legler, 

Strama, Reynolds, and Chisum, amends sections of Texas Health and Safety Code (THSC), 

Chapter 391. This chapter establishes-the Texas Clean Fleet Program (program) to be 

funded from the Texas Emissions Reduction Plan (TERP) Fund and administered by the 

Texas Commission on Environmental Quality (commission). The changes under HB 3399 

require amendment of existing rules to revise current provisions and add new provisions. 

Scope of the rulemaking: 

A.) Summary of what the rulemaking will do: HB 3399 added new subsections and 

revised existing sections of THSC, Chapter 391, Texas Clean Fleet Program. The revisions 

to 30 TAC Chapter 114, as required by HB 3399, incorporate changes and additions to the 

program eligibility criteria, including: changes to the number of vehicles that must be 

included in a grant and that may be awarded funding by the commission; changes to allow 

a vehicle that has been leased or commercially financed to be replaced under the program; 

changes to the time period over which a grant-funded vehicle must be operated, to either 

five years or 400,000 miles, whichever occurs earlier; and establishing criteria for 

decommissioning a vehicle or vehicle engine replaced under the program. The revisions 

also include provisions, as required under HB 3399, that the executive director shall waive 

the ownership and use requirements for the vehicle being replaced, upon a finding of good 

cause. 

B.) Scope required by federal regulations or state statutes: The adopted rules are 

required by changes to THSC, Chapter 391, under HB 3399· 

C.) Additional staff recommendations that are not required by federal rule or 

·state statute: Staff is not recommending additional provisions beyond what is required 

under THSC, Chapter 391, as amended by HB 3399· 
[. 

i 

Commissioners 

Page 2· 

March 9, 2012 

Re: Docket No. 2011~1220-RUL 

Statutory authority: 

• Texas Water Code (TWC), §5.102, which provides the commission with the general 

powers to carry out its duties; 

• TWC, §5.103, which authorizes the commission to adopt any rules necessary to carry 

out the powers and duties under the provisions of the TWC and other laws of the 

state; 

• TWC, §5.105, which authorizes the commission by rule to establish and approve all 

general policy of the commission; 

• THSC, §382.107, which authorizes the commission to adopt rules consistent with 

the policy and purposes of the Texas Clean Air Act; 

• THSC, §382.011, which authorizes the commission to establish the level of quality to 

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

• THSC, §382.012, which authorizes the commission to prepare and develop a 

-general, comprehensive plan for the control of the state's air; 

• THSC, Chapter 386, which establishes the TERP program; and 

• THSC, Chapter 391, which establishes the Texas Clean Fleet Program. 

Effect on the: 

A.) Regulated community: These rules will not affect regulated entities. 

B.) Public: The changes to the eligibility criteria for the grants will potentially expand the 

number of entities and vehicles eligible to participate in the grants. The changes may also 

make it easier for some entities to participate in the program. 

C.) Agency programs: Program processes, criteria, and forms will need to be updated. 

Also, a process will need to be developed for considering waivers to the eligibility 

requirements. 

Stakeholder meetings: 

Stakeholder meetings were not held for this rulemaking. 

Public comment: 

The proposal was published in the November 4, 2011, issue of the Texas Register (36 

TexReg 7472). A public hearing was scheduled for November 29, 2011; however, since no 

one registered to provide comments, the hearing was not officially opened. The comment 

period closed on December 5, 2011. The commission received written comments from 

Clean Energy Fuels (Clean Energy), Crossroads Equipment Lease & Finance (Crossroads), 

Pioneer Natural Resources USA, Inc. (Pioneer), and United Parcel Service (UPS) in 

support of all or part of the rulemaking. The United States Environmental Protection 

Agency Region 6 (EPA) submitted written comments in support of the rulemaking, but 

expressed concern and recommended changes to part of the proposal. Significant 

comments and concerns are discussed further. 
Commissioners 

Page3 

March 9, 2012 

Re: Docket No. 2011~122o~RUL 

Clean Energy and Pioneer commented that the proposed rule changes will make the 

program more effective and efficient for Texas-based fleets by simplifying the application 

process. Crossroads also stated that the proposed rule changes demonstrated an 

acknowledgement of the potential challenges entities face when soliciting applicants for 

funding and that fleets in the designated areas will greatly benefit from the rule changes. 

No changes were made to the proposed text in response to these comments. 

Clean Energy, Pioneer, and UPS expressed support for the addition of §114.653(e) to 

provide the executive director the authority to waive the requirements of §114.653Cb)(1), 

pertaining to the ownership, registration, and use of the vehicle being replaced, on a 

finding of good cause. No changes were made to the proposed text in response to these 

comments. 

The EPA expressed concern with the addition §114.653(e). EPA recommended the 

commission remove the phrase 11 0r other circumstances" from subsection (e), since it is not 

well defined. Changes were made to the proposed text in response to these comments, as 

outlined in the following section regarding significant changes from the proposal. 

Significant changes from proposal: 

The provision in §114.653(e) implements requirements added by HB 3399· The intent of 

this provision is to authorize the executive director to consider unique situations that, 

while not meeting the strict letter of the eligibility requirements, will still meet the intent of 

the requirements. Therefore, the term "other circumstances" was not removed from 

§114.653(e) in response to the EPA's comment. However, additional language was added 

to subsection (e) from the proposed text to state that in granting a waiver, the executive 

director shall ensure that the projected emissions reductions will be valid and, where 

applicable, meet the conditions for assignment for credit to the state implementation plan. 

This addition is intended to clarify the limits on the waiver provisions and to provide 

assurance that any waiver decision will be made only after considering the impact of the 

waiver on the emissions reductions. 

Potential controversial concerns and legislative interest: 

The rules incorporate provisions required under THSC, Chapter 391, as amended by HB 

3399. The niles do not go further than what is required to comply with the statutory 

changes. Therefore, staff does not anticipate any concerns being raised about the mles, 

beyond the comments received on the proposed text. Staff expects that the legislators 

involved in HE 3399 and stakeholders will be interested in how the commission 

implements the new provisions. 

Does this rulemaking affect any current policies or require development of 

new policies? 

Program application materials and contract shells will need to be updated. Also, a process 

will need to be developed for considering waivers to the eligibility requirements. 
Commissioners 

Page4 

March 9, 2012 

Re: Docl<:et No. 2011-1220-RUL 

'What are the consequences if this rulemaldng does not go forward? Are there 

alternatives to rulemaking? 

This rulemaking is required to amend the criteria for implementing the Texas Clean Fleet 

Program under THSC, Chapter 391. If the rulemaldng is not completed, implementation of 

the program under existing mles would be inconsistent with the statutory provisions. 

Possible alternatives are not adopting the rules or adopting the rules at a later date and 

delaying implementation of the program. 

Key points in the adoption rulemaking schedule: 

Texas Register proposal publication date: November 4, 2011 

Anticipated Texas Register publication date: Apri113, 2012 

Anticipated effective date: April19, 2012 

Six-month Texas Register filing deadline: May 4, 2012 

Agency contacts: 

Steve Dayton, Rule Project Manager, 239-6824, Air Quality Division 

Betsy Peticolas, Staff Attorney, 239-1439 

Charlotte Horn, Texas Register Coordinator, 239-0779 

Attachments 

cc: Chief Clerk, 2 copies 

Executive Director's Office 

Susana M. Hildebrand, P.E. 

Anne Idsal 

Curtis Seaton 

Ashley Morgan 

Office of General Counsel 

Steve Dayton 

Charlotte Horn 
EVALUATION OF TESTIMONY 

The Texas Commission on Environmental Quality (TCEQ or commission) adopts the 

amendments to §§114.650 - 114.654. 

Section 114.653 is adopted with change to the proposed text as published in the November 4, 

2011, issue ofthe Texas Register (36 TexReg 7472). Sections 114.650- 114.652, and 114.654 are 

adopted without changes to the proposed text and will not be republished. 

The amended sections will be submitted to the United States Environmental Protection Agency 

(EPA) as a revision to the state implementation plan. 

Background and Summary of the Factual Basis for the Adopted Rules 

Senate Bill1759, 81st Legislature, 2009, amended the Texas Health and Safety Code (THSC), by 

adding Chapter 391, Texas Clean Fleet Program (program). This program is designed to 

encourage eligible fleets to replace diesel vehicles with alternative fuel or hybrid vehicles. House 

Bill (HB) 3399, 82nd Legislature, 2011, amended THSC, Chapter 391, to revise current eligibility 

criteria and add additional criteria. The changes made under HB 3399 are as summarized in the 

following paragraphs. 

THSC, §391.002(b), was revised to reduce the number from 25 to 20 of qualifying vehicles that 

an entity must place in service in the state in order to be eligible to participate in the program. 

This provision further allows under THSC, §391.002(c), for commission funding of fewer than 

1 
20 vehicles under a grant, as long as an entity's application originally included 20 vehicles for 

replacement under the program. This provision allows an application to be approvable in the 

event that the commission does not approve one or more vehicles for funding during the 

application process. 

THSC, §391.004(a), was revised to reduce from 100 to 75 the number of vehicles that any entity 

must operate in its fleet in the state in order to be eligible to apply for and receive a grant under 

the program. 

Under a new THSC, §391.004(d), the commission is directed to minimize, to the maximum 

extent possible, the amount of paperwork required for an application. In addition, an applicant 

may be required to submit a photograph or other documentation of a vehicle identification 

number, registration information, inspection information, tire condition, or engine block 

identification only if it is requested after the commission has decided to award a grant to the 

applicant. 

THSC, §391.005(b)(2)(A), was revised to allow a vehicle that has been leased or otherwise 

commercially financed and registered and operated by the applicant .in Texas for at least the two 

years immediately preceding the submission of a grant application to be replaced under the 

program. The previous language only allowed vehicles that had been owned, registered, and 

operated in Texas by the applicant for the preceding two years to be replaced under the 

program. 

2 
Requirements regarding the operational period of vehicles under this grant program were 

expanded under THSC, §391.005(c). Previously, vehicles funded through a grant were required 

to be operated for at least five years from the date of reimbursement of expenses. Under the 

THSC, §391.005( c) the vehicle must be operated until the earlier of the fifth anniversary of the 

reimbursement date or until the date the vehicle has been in operation for 400,000 miles. 

THSC, §391.005(±), was revised to require the commission to provide a means for an applicant 

to propose an alternative method of complying with the vehicle or engine destruction 

requirements of this subsection. The existing requirements include rendering the vehicle 

permanently inoperable by crushing the vehicle or making a hole in the engine block and 

permanently destroying the frame of the vehicle. 

Finally, THSC, §391.005(i), was added to require the executive director of the TCEQ to waive the 

requirements ofTHSC, §301.004(b)(2)(A), upon a finding of good cause, which may include a 

waiver for short lapses in registration or operation attributable to economic conditions, seasonal 

work, or other circumstances. This subsection includes requirements that an applicant have 

owned, leased, or otherwise commercially financed, registered, and operated the vehicle to be 

replaced in Texas for at least two years immediately preceding the submission of a grant 

application. The new subsection also requires that, in granting a waiver, the executive director 

must ensure that the emissions reductions will still be valid and, where applicable, meet the 

conditions for assignment for credit to the state implementation plan. 

These rules incorporate the changes to THSC, Chapter 391, under HB 3399. 

3 
Section by Section Discussion 

§114.650, Definitions 

Revisions to §114.650(2) amend the definition of an "Eligible entity" to reduce the number of 

vehicles in an entity's fleet that must be registered in Texas from 100 to 75 vehicles and the 

number of vehicles in an entity's fleet that must be eligible for replacement from 25 to 20 

vehicles as required under THSC, §391.004. 

§114.651, Applicability 

Section 114.651(a) is amended to reduce the number of vehicles that must be included in an 

application from 25 to 20 vehicles, as required by THSC, §391.002(a). 

In addition, amended subsection (b) allows an entity to participate in the program if that entity 

submits a grant application for 20 or more qualifying vehicles, even if the commission denies 

approval for one or more of the vehicles during the application process, as required by THSC, 

§391.002(b). 

§114.652, Qualifying Vehicles 

Section 114.652(b) is amended to incorporate changes to the requirement for how long a grantfunded qualifying vehicle must be owned, registered, and operated in Texas by a grant recipient. 

The ownership and use requirement is changed from a period at least five years from the date of 

reimbursement of the grant-funded expenses, to until the earlier of the fifth anniversary of the 

date of reimbursement of the grant-funded expenses or until the date the vehicle has been in 

operation for 400,000 miles after the date of reimbursement. The amendment is required by 

THSC, §391.005. 

4 
§114.653, Grant Eligibility 

Section 114.653(b) is amended to incorporate changes to the grant eligibility requirements to 

allow a vehicle that has been leased or commercially financed by the applicant to be replaced 

under the program, as required by THSC, §391.005. 

Section 114.653 is also amended to add subsection (e) directing the executive director to waive 

the requirement that a vehicle have been owned, leased, or commercially financed and 

registered and operated in Texas by the applicant on a finding of good cause, as required by 

THSC, §391.005. Additional language is added since proposal to make it clear that, in granting a 

waiver, the executive director is to determine that the emissions reductions attributed to the 

project will be still be valid and, where applicable, will meet the conditions for assignment for 

credit to the state implementation plan. 

§114.654, Usage and Disposition 

Section 114.654(b) is amended to include specific criteria for how a vehicle replaced under the 

program must be rendered permanently inoperable and to direct the executive director to 

provide a means for an applicant to propose an alternative method for rendering a vehicle 

inoperable, as required by THSC, §391.005. 

Under the specific criteria added to subsection (b), a vehicle or engine replaced under the 

program will need to be rendered permanently inoperable by crushing the vehicle, by making a 

hole in the engine block and permanently destroying the frame of the vehicle, or by another 

method approved by the executive director that permanently removes the vehicle from 

5 
operation in this state. The executive director is required to provide a means for an applicant to 

propose an alternate method for complying with these destruction requirements. 

Final Regulatory Impact Analysis 

The commission reviewed the rulemaking in light of the regulatory analysis requirements of 

Texas Government Code, §2001.0225, and determined that this rule action is not subject to 

Texas Government Code, §2001.0225, because it does not meet the definition of a "major 

environmental rule" as defined in that statute. A "major environmental rule" means a rule the 

specific intent of which is to protect the environment or reduce risks to human health from 

environmental exposure and that may adversely affect in a material way the economy, 

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

sector of the state. 

The amended Chapter 114 rules are adopted in accordance with HB 3399, which amended 

THSC, Chapter 391. The program offers financial incentives for the voluntary replacement of 

diesel engines. Because the rules place no involuntary requirements on the regulated 

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

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

state or a sector of the state. Also, none of the amendments place additional financial burdens 

on the regulated community. 

In addition, a regulatory impact analysis is not required because the rules do not meet any of the 

four applicability criteria for requiring a regulatory analysis of a "major environmental rule" as 

defined in the Texas Government Code. Texas Government Code, §2001.0225, applies only to a 

6 
major environmental rule the result of which is to: 1) exceed a standard set by federal law, 

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

law, unless the rule is specifically required by federal law; 3) exceed a requirement of a 

delegation agreement or contract between the state and an agency or representative of the 

federal government to implement a state and federal program; or 4) adopt a rule solely under 

the general powers of the agency instead of under a specific state law. This rulemaking does not 

exceed a standard set by federal law. In addition, this rulemaking does not exceed an express 

requirement of state law and is not adopted solely under the general powers of the agency, but is 

specifically authorized by the provisions cited in the Statutory Authority section of this 

preamble. Finally, this rulemaking does not exceed a requirement of a delegation agreement or 

contract to implement a state and federal program. 

The commission invited public comment regarding the draft regulatory impact analysis 

determination during the public comment period. No comments were received regarding the 

regulatory impact analysis determination. 

TakingslnnpactAssessnnent 

The commission evaluated this rulemaking action and performed an analysis of whether the 

adopted rules are subject to Texas Government Code, Chapter 2007. The primary purpose of the 

rulemaking is to amend Chapter 114 in accordance with HB 3399. The rules amend the criteria 

for implementing a voluntary program and only affect motor vehicles which are not considered 

to be private real property. The promulgation and enforcement of the rules is neither a statutory 

nor a constitutional taking because it does not affect private real property. Therefore, the rules 

do not constitute a taking under Texas Government Code, Chapter 2007. 

7 
Consistency with the Coastal Management Program 

The commission reviewed the adopted rulemaking and found the adoption is a rulemaking 

identified in the Coastal Coordination Act Implementation Rules, 31 TAC §sos.11(b)(2), 

concerning rules subject to the Texas Coastal Management Program (CMP), and will, therefore, 

require that goals and policies of the CMP be considered during the rulemaking process. The 

commission reviewed this action for consistency and determined the rulemaking for Chapter 114 

does not impact any CMP goals or policies, because it revises a voluntary incentive grant 

program and does not govern air pollution emissions. 

The commission invited public comment regarding the consistency with the coastal 

management program during the public comment period. No comments were received 

regarding consistency with the CMP. 

Public Comment 

A public hearing was scheduled for November 29, 2011; however, since no one registered to 

provide comments, the hearing was not officially opened. The comment period closed on 

December 5, 2011. The commission received written comments from Clean Energy Fuels (Clean 

Energy), Crossroads Equipment Lease & Finance (Crossroads), Pioneer Natural Resources USA, 

Inc. (Pioneer), and United Parcel Service (UPS) in support of all or part of the rulemaking. EPA 

submitted written comments in support of the rulemaking, but expressed concern and 

recommended changes to part of the proposal. 

8 
Response to Comments 

Clean Energy, Crossroads, Pioneer, and UPS commented in support of the rule changes. Clean 

Energy and Pioneer also commented that the proposed rule changes will make the program 

more effective and efficient for Texas-based fleets by simplifying the application process. 

Crossroads provided background information on its providing financing and assisting entities in 

California and nationally to obtain funding for grant funding. Crossroads also stated that the 

proposed rule changes demonstrated an acknowledgement of the potential challenges entities 

face when soliciting applicants for funding and that fleets in the designated areas will greatly 

benefit from the rule changes. EPA expressed appreciation for TCEQ's efforts to continually 

improve and expand mobile source incentive programs. 

The commission appreciates the continued support expressed for the TERP 

programs. No changes were made to the proposed text in response to this 

comment. 

Clean Energy, Pioneer, and UPS expressed support for the addition of §114.653(e) to provide the 

executive director the authority to waive the requirements of §114.653(b)(1), pertaining to the 

ownership, registration, and use of the vehicle being replaced, on a finding of good cause. 

The commission appreciates the support expressed for the proposed rule changes 

and for the TERP in general. No changes were made to the proposed text in 

response to these comments. 

9 
EPA expressed concern with the addition of §114.653(e) to provide the executive director the 

authority to waive the requirements of §114.653(b )(1), pertaining to the ownership, registration, 

and use of the vehicle being replaced, on a finding of good cause. EPA recommended the 

commission remove the phrase "or other circumstances" from subsection (e), since it is not well 

defined. 

The intent of the provision is to authorize the executive director to consider 

unique situations, including situations not yet contemplated, that may not meet 

the letter of the standard criteria but will still meet the intent of the requirements. 

Therefore, the commission did not remove the term "other circumstances" from 

the rule language. However, to clarify the limits on the waiver provisions and to 

provide assurance that any waiver decision will be made only after considering the 

impact of the waiver on the emissions reductions, additional language was added 

to §114.653(e) since proposal to state that in granting a waiver, the executive 

director shall ensure that the projected emissions reductions will be valid and, 

where applicable, meet the conditions for assignment for credit to the state 

implementation plan. 

10 
RECOMMENDATION 
SUBCHAPTER K: MOBILE SOURCE INCENTIVE PROGRAMS 

DIVISION 5: TEXAS CLEAN FLEET PROGRAM 

§§114.650 - 114.654 

Statutory Authority 

The amendments are adopted under Texas Water Code (TWC), §5.102, which provides the 

commission with the general powers to carry out its duties under the TWC; TWC, §5.103, which 

authorizes the commission to adopt any rules necessary to carry out the powers and duties under 

the provisions of the TWC and other laws of this state; and TWC, §5.105, which authorizes the 

commission by rule to establish and approve all general policy of the commission. These 

amendments are also adopted under Texas Health and Safety Code (THSC), Texas Clean Air Act, 

§382.017, which authorizes the commission to adopt rules consistent with the policy and 

purposes of the THSC; THSC, §382.011, which authorizes the commission to establish the level of 

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

§382.012, which authorizes the commission to prepare and develop a general, comprehensive 

plan for the control of the state's air. Finally, these amendments are adopted under THSC, 

Chapter 391, and are part of the implementation of House Bil13399. 

The amendments implement THSC, §§391.002, 391.004, and 391.005. 

§114.650. Definitions. 

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

commission, the terms used in this subchapter have the meanings commonly ascribed to them in 

the field of air pollution control. In addition to the terms that are defined by the TCAA and §§3.2, 

1 
101.1, and 114.1 of this title (relating to Definitions), the following words and terms, when used in 

this division will have the following meanings, unless the context clearly indicates otherwise. 

(1) Alternative fuel--A fuel, other than gasoline or diesel fuel. When used in this 

division, this definition is limited to the following: electricity, compressed natural gas, liquefied 

natural gas, hydrogen, prDpane, or a mixture of fuels containing at least 85% methanol by 

volume. 

(2) Eligible entity--Any person or entity with a fleet of 75 or more vehicles that: 

(A) are registered in Texas; and 

(B) include at least 20 vehicles that are eligible for replacement. 

(3) Golf cart--A motor vehicle designed by the manufacturer primarily for 

transporting persons on a golf course. 

(4) Heavy-duty vehicle--A motor vehicle with a gross vehicle weight rating greater 

than 8,500 pounds and containing an engine certified to the United States Environmental 

Protection Agency's heavy-duty engine standards. 

(5) Hybrid vehicle--A motor vehicle with at least two different energy converters 

and two different energy storage systems on board the vehicle for the purpose of propelling the 

vehicle. 

2 
(6) Light-duty motor vehicle--A motor vehicle with a gross vehicle weight rating of 

less than 10,000 pounds and certified to the United States Environmental Protection Agency's 

light-duty vehicle emission standards. 

(7) Motor vehicle--A self-propelled device designed for transporting persons or 

property on a public highway that is required to be registered under Texas Transportation Code, 

Chapter 502. 

(8) Neighborhood electric vehicle--A motor vehicle that: 

(A) is originally manufactured to meet, and does meet, the equipment 

requirements and safety standards established for "low-speed vehicles" in Federal Motor Vehicle 

Safety Standard No. 500 (49 Code of Federal Regulations §571.500); 

(B) is a slow-moving vehicle, as defined by Texas Transportation Code, 

§547.001 that is able to attain a speed of more than 20 miles per hour but not more than 25 miles 

per hour in one mile on a paved, level surface; 

(C) is a four-wheeled motor vehicle; 

(D) is powered by electricity or alternative power sources; 

(E) has a gross vehicle weight rating ofless than 3,000 pounds; and 

(F) is not a golf cart. 

3 
(9) Program--The Texas Clean Fleet Program established under this division. 

§114.651. Applicability. 

(a) Any eligible entity that will replace 20 or more on-road diesel vehicles within a twelvemonth period with qualifying vehicles may apply for a grant under the Texas Clean Fleet 

Program to offset the cost of replacing those vehicles with alternative fuel or hybrid vehicles. 

(b) Notwithstanding subsection (a) of this section, an entity that submits a grant 

application for 20 or more qualifying vehicles is eligible to participate in the program even if the 

commission denies approval for one or more of the vehicles during the application process. 

(c) The commission may allow a regional planning commission, council of governments, 

or similar regional planning agency created under Local Government Code, Chapter 391, or a 

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

program to achieve its goals. 

§114.652. Qualifying Vehicles. 

(a) A qualifying vehicle is one that: 

(1) is certified to current federal emissions standards; 

4 
(2) replaces a diesel-powered on-road vehicle of the same weight classification 

and use; and 

(3) is a hybrid vehicle or fueled by an alternative fuel. 

(b) As a condition of receiving a grant the qualifying vehicle must be continuously owned, 

registered, and operated in Texas by the grant recipient until the earlier of the fifth anniversary 

of the date of reimbursement ofthe grant-funded expenses or until the date the vehicle has been 

in operation for 400,000 miles after the date of reimbursement. 

(c) A vehicle is not a qualifying vehicle if it: 

(1) is a neighborhood electric vehicle; 

(2) has been used as a qualifying vehicle to qualify for a grant under this division 

for a previous reporting period or by another entity; or 

(3) has qualified for a similar grant or tax credit in another jurisdiction. 

§114.653. Grant Eligibility. 

(a) To be eligible for a grant under the program a project must result in a reduction in 

emissions of nitrogen oxides of at least 25%, based on: 

(1) the baseline emission level set by the executive director; and 

5 
(2) the certified emission rate of the new vehicle or engine. 

(b) The vehicle being replaced must: 

(1) be an on-road vehicle that has been owned, leased, or otherwise commercially 

financed, and registered and operated by the applicant in Texas for at least the two years 

immediately preceding the submission of a grant application; 

(2) satisfy any minimum average annual mileage or fuel usage requirements 

established by the executive director; 

(3) satisfy any minimum percentage of annual usage requirements established by 

the executive director; and 

( 4) be in operating condition with at least two years of remaining useful life, as 

determined in accordance with criteria established by the executive director. 

(c) At the discretion of the executive director, projects that result in a 25% reduction in 

other pollutants may be considered eligible for funding under this program. 

(d) The executive director may establish additional criteria for purposes of prioritizing 

projects for selection. Such criteria may include, but are not limited to: 

6 
(1) nonattainment status of the primary location in which the eligible vehicles are 

used; or 

(2) cost per ton benefits of the overall emissions being reduced. 

(e) The executive director shall waive the requirements of subsection (b)(l) of this section 

on a finding of good cause, which may include a waiver for short lapses in registration or 

operation attributable to economic conditions, seasonal work, or other circumstances. In 

determining good cause and deciding whether to grant a waiver, the executive director shall 

ensure that the emissions reductions that will be attributed to the project will still be valid and, 

where applicable, meet the conditions for assignment for credit to the state implementation plan. 

§114.654. Usage and Disposition. 

(a) Not less than 75% of the annual use of the qualifying vehicle, either mileage or fuel use 

as determined by the executive director, must occur in Texas. 

(b) A vehicle or engine replaced under this program must be rendered permanently 

inoperable by crushing the vehicle, by making a hole in the engine block and permanently 

destroying the frame of the vehicle, or by another method approved by the executive director that 

permanently removes the vehicle from operation in this state. The executive director shall 

provide a means for an applicant to propose an alternative method for complying with the 

requirements of this subsection. 

7 
THE STATE OF~ AS 

TEXAS COMMISSION ON ENVIRg~1PAJJ. ~ITY E I hereby certify tha. this, is a true and correct copy of a 

f\~; TexasCommission on Environmental Quality document, 

r~ ~ w~ich is filed in the permanent records of the Co. mmission. I( 'J; Grven u.n?er my hand and th~ seal of office on 

·~ 8/(A~/~.&kv APR 0 3 2012 

Bridget C. ohac, Chief Clerk 

Texas Commission on Environmental Quality 

ORDER ADOPTING AMENDED RULES AND REVISIONS TO THE STATE 

IMPLEMENTATION PIAN 

Docket No. 2011-1220-RUL 

On March 28, 2012, the Texas Commission on Environmental Quality (Commission), during 

a public meeting, considered adoption of amended§§ 114.650- 114.654. The Commission 

adopts this amendment, in Chapter 114, Control of Air Pollution from Motor Vehicles, 

Subchapter K, Mobile Source Incentive Programs, Division 5, Texas Clean Fleet Program; and 

corresponding revisions to the state implementation plan (SIP). The revisions to Chapter 114 

incorporate changes and additions to the program eligibility criteria and add provisions that 

the executive director shall waive the ovvnership and use requirements for the vehicle being 

replaced, upon a finding of good cause. Under Tex. Health & Safety Code Ann. §§ 382.011, 

382.012, and 382.023 (Vernon 2001), the Commission has the authority to control the quality· 

of the state's air and to issue orders consistent vvith the policies and purposes of the Texas 

Clean Air Act, Chapter 382 of the Tex. Health & Safety Code. The proposed rule was/rules 

were published for comment in the November 4, 2012, issue of the Texas Register (36 TexReg 

7472). 

Pursuant to Tex. Health & Safety Code Ann.§ 382.017 (Vernon 2001), Tex. Gov't Code 

Chapter 2001 (Vernon 2008), and 40 Code of Federal Regulations § 51.102, and after proper 

notice, the Commission conducted a public hearing to consider the revised rules and revisions 

to the SIP. Proper notice included prominent advertisement in the areas affected at least 30 

days prior to the date of the hearing. A public hearing was held in Austin, Texas, on 

November 291 2011. 

The Commission circulated hearing notices of its intended action to the public, 

including interested persons, the Regional Administrator of the EPA, and all applicable local 

air pollution control agencies. The public was invited to submit data, views, and 

recommendations on the proposed amended rules and SIP revisions, either orally or in 

vvriting, at the hearing or during the comment period. Prior to the scheduled hearing, copies 

of the proposed amended rules and SIP revisions were available for public inspection at the 

Commission's central office and on the Commission's Web site. 

Data, views, and recommendations of interested persons regarding the proposed 

amended rules and SIP revisions were submitted to the Commission during the comment 

period, and were considered by the Commission as reflected in the analysis of testimony 

incorporated by reference to this Order. The Commission finds that the analysis of testimony 

includes the names of all interested groups or associations offering comment on the proposed 

amended rules and the SIP revisions and their position concerning the same. 
• • I 1 

l -~ - , , 

1 . GAX:-jl ·:.h) ·~~ ;-,:;. r e 3r·1: 

·'. · ·.rt· IS'TfiE~FOREtiRDEREti;BY THE COMMISSION that the amended rules and 

.~ •• ~ .~:) ~Vf.~~~~;~t~;~l}~.gg 4~~9fP·P¥,~f~4{~£~ference to this Order are.hereb~ ~dopted. The 

no'<"'''''·Commiss~qr.:l. furthertauthonze&staf£-t0 make any non-substantive reVIsiOns to the rules 

. :n~~¢ssazy" tfil''~f?¥1PIY'~Wit11' Texds Refji'Ster requirements. The adopted rules and the preamble 

__ .. ___ ·~t~:~h~-~~ont\!d~~~e~~a~'d Ql:~:~~vi~ic>.l;l~to the SIP are incorporated by reference in this Order 

as if se~. 'for1:h, .atjl~~gth;y~rbaJimjJ:1~this Order. ~.e,1f ~(·;~~:',~ }:r::·~~~;.:·f5~~\./(;:.1 f!·.J fV") 1 .::/·~·1!~1(': J r"!.',; ··· .. 

IT IS FURTHER ORDERED BY THE COMMISSION that on behalf of the Commission, 

the Chairman should transmit a copy of this Order, together with the adopted rules and 

revisions to the SIP, to the Regional Administrator of EPA as a proposed revision to the Texas 

SIP pursuant to the Federal Clean Air Act, codified at 42 U.S. Code Ann. §§ 7401- 7671q, as 

amended. 

This Order constitutes the Order of the Commission required by the Administrative 

Procedure Act, Tex. Gov't Code,§ 2001.033 (Vernon 2008). 

If any portion of this Order is for any reason held to be invalid by a court of competent 

jurisdiction, the invalidity of any portion shall not affect the validity of the remaining 

portions. 

Date issued: APR 0 3 2012 

TEXAS COMMISSION ON 

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