FABulletin,Doc.No.06-2406Page1of23UIa—. 

# RULES

AND REGULATIONS Title 25--ENVIRONMENTAL

PROTECTIONENVIRONMENTALQUALITYBOARD[25PA.CODECHS.121AND1261PennsylvaniaCleanVehiclesProgram[36Pa.B.7424][Saturday,December9,20061TheEnvironmentalQualityBoard(Board)amendsChapters121and126(relatingtogeneralprovisions;andmotorvehicleandfuelsprograms).Thefinal-formrulemakingpostponesthecompliancedatefrommodelyear(MY)2006toMY2008andupdatesdefinitionsin



# §121.1(relatingtodefmitions)fortermsthatareusedinthesubstantiveprovisionsinChapter126,SubchapterD(relatingtoPennsylvaniaCleanVehiclesProgram).Thefinal-formrulemakingalsoclarifiesthePennsylvaniaCleanVehiclesProgram(Program)inSubchapterDandspecifiesinthatsubchapteratransitionmechanismforcompliancewiththeProgram.ThisorderwasadoptedbytheBoardatitsmeetingonSeptember19,2006.A.EffectiveDateThisfinal-formrulemakingwillgointoeffectuponpublicationinthePennsylvaniaBulletin.B.ContactPersonsForfurtherinformation,contactArleenShulman,ChiefMobileSourcesSection,BureauofAirQuality,P.0.Box8468,Harrisburg,PA17105-8468,(717)772-3926;orKristenM.Campfield,AssistantCounsel,BureauofRegulatoryCounsel,P.0.Box8464,Harrisburg,PA17105-8464,(717)787-7060.PersonswithadisabilitymayusetheAT&TRelayService,(800)654-5984(TDDusers)or(800)654-5988(voiceusers).Thisfinal-formrulemakingisavailableontheDepartmentofEnvironmentalProtection’s(Department)websiteatwww.depweb.state.pa.us(QuickAccess:PublicParticipation).C.StatutoryAuthorityThefinal-formrulemakingisbeingmadeundersection5oftheAirPollutionControlAct(act)(35P.S.



# §4005),whichinsubsection(a)(1)grantstheBoardtheauthoritytoadopthttp://www.pabulletin.com!secure/datalvol36/36-49/2406.html5/16/2007PABulletin,Doc.No.06-2406(.Page2of23regulationsfortheprevention,control,reductionandabatementofairpollution,insubsection(a)(7)grantstheBoardtheauthoritytoadoptregulationsdesignedtoreduceemissionsfrommotorvehiclesandinsubsection(a)(8)grantstheBoardtheauthoritytoadoptregulationstoimplementtheCleanAirAct(CAA)(42U.S.C.A.§7401--7642).D.PurposeandBackgroundThepurposesofthisfinal-formrulemakingaretopostponethecompliancedatefromMY2006toMY2008andspecifya3-yearearly-creditearningperiodwithinwhichvehiclemanufacturersmustcomeintocompliancewiththenonmethaneorganicgases(NMOG)fleetaverageoftheProgram.Specifyinganearly-creditearningperiodisintendedtoprovideatransitionmechanismfromtheNationalLowEmissionVehicle(NLEV)programandtohelpensureidenticalityuwiththeCaliforniaprogram.Thepurposeofthisfinal-formrulemakingisalsotoclarifytheProgramtoreflectpost-1998amendmentsoftheCaliforniaprovisionsincorporatedbyreferenceandtoreflecttheendoftheNLEVcomplianceoption.ByamendingtheregulationstoreflectchangesintheCaliforniarequirementsandbyprovidingflexibilityforthevehiclemanufacturersduringimplementation,citizensinthisCommonwealthcanobtaintheairqualitybenefitsofthisProgramwithaminimizedimpact.PostponementoftheProgramfromMY2006toMY2008doesnotsignificantlyaffectlong-termairqualityandeconomicbenefits.Costsavingsformanufacturersandconsumerswouldalsoberealizedwiththedelayedcomplianceschedule.TheProgramdoesnotmandatethesaleoruseofreformulatedmotorfuelsthatcomplywiththespecificationsforreformulatedmotorfuelsmandatedbyCalifornia.Thecourtshaveheldthatastat&sfailuretoadoptCaliforniafuelrequirementsdoesnotviolatetherequirementinsection177oftheCAA(42U.S.C.A.§7507)thatstateemissionstandardsbeidenticaltotheCaliforniastandardsforwhichawaiverhasbeengranted.MotorVehicleManufacturersAssociationoftheUnitedStatesv.NewYorkStateDepartmentofEnvironmentalConservation,17F.3d521(2dCir.1994);AmericanAutomobileManufacturersAssociationv.Greenbaum,No.93-10799-MA(D.Mass.Oct.27,1993)aff’d.,31F.3d18(1stCir.1994).Inaddition,theProgramdoesnotincorporatetheCaliforniazeroemissionsvehicle(ZEV)provisions.Section177oftheCAAdoesnotrequireadoptionofalloftheCaliforniastandards;itonlyrequiresthatifastateadoptsmotorvehiclestandards,thosestandardsbeidenticaltotheCaliforniastandards.TheUnitedStatesEnvironmentalProtectionAgency(EPA)concludesthatstatesadoptingaSection177programneednotadoptCalifornia’sZEVrequirementstocomplywiththeCAArequirementsforidenticalstandardsundersection177oftheCAA.See60FR4712(January24,1995).RetainingandclarifyingtheCalifornialowemissionvehicle(LEV)programrequirementsinthisCommonwealthareconsistentwiththeactionsofothernortheasternstates.Maine,Massachusetts,NewYorkandVermontadoptedtheCaliforniaLEVprograminthefirstinstance,asdidtheCommonwealth,buttheydidnotprovidetheNLEVcomplianceoptionliketheCommonwealthdid.ThosestateshaverevisedtheirregulationstoincorporatetheCaliforniaLowEmissionVehicleII(CALEVIIorCaliforniaLEVII)provisions.OthernortheasternstatesadoptedtheCaliforniaLEVprogramandtheNLEVcomplianceoptioninthefirstinstance,liketheCommonwealthdid.Thosestates,namelyRhodeIsland,ConnecticutandNewJersey,haveadoptedregulationstoimplementtheCALEVIIprogram.OregonandWashingtonhavealsoadoptedtheCALEVIIprogram.Thehttp://www.pabulletin.com/secure/dataJvol36/36-49/2406.html5/16/2007PABulletin,Doc.No.06-2406Page3of23Commonwealth’soriginalincorporationoftheCaliforniaLEVprogramin1998automaticallyincorporatesthecurrentCaliforniaLEVprogram,CALEVII,andwillcontinueautomaticallytoincludeCalifornia’sfutureamendmentsandsupplementstoitsLEVprogram.Whenground-levelozoneispresentinconcentrationsinexcessoftheFederalhealthbasedstandard,publichealthisadverselyaffected.TheEPAhasconcludedthatthereisanassociationbetweenambientozoneconcentrationsandincreasedhospitaladmissionsforrespiratoryailments,suchasasthma.Further,althoughchildren,theelderlyandthosewithrespiratoryproblemsaremostatrisk,evenhealthyindividualsmayexperienceincreasedrespiratoryailmentsandothersymptomswhenexposedtoambientozonewhileengagedinactivitiesthatinvolvephysicalexertion.Thoughthesymptomsareoftentemporary,repeatedexposurecouldresultinpermanentlungdamage.TheimplementationofmeasurestoaddressozoneairqualitynonattainmentinthisCommonwealthisnecessarytoprotectthepublichealth.Gasoline-poweredmotorvehiclesprimarilyemitthreepollutants:carbonmonoxide,volatileorganiccompounds(VOCs)andoxidesofnitrogen(NO).Ozoneisnotdirectlyemittedbymotorvehicles,butiscreatedasaresultofthechemicalreactionofNOandVOCs,inthepresenceoflightandheat,toformozoneinairmassestravelingoverlongdistances.Theformationofozoneisgreaterinthesummermonthsbecauseofthehighertemperatures.About1/3ofthisCommonwealth’sozone-formingpollutioncomesfrommotorvehicles.Inearly2007,theEPAisexpectedtofinalizethePM25implementationrule,whichwillalsoidentifyNOemissionsasoneoftheprecursorstotheformationofPM25.Therefore,thisfinal-formrulemakingshouldalsoenabletheDepartmenttomakeprogressinattainingandmaintainingthePM25NationalAmbientAirQualityStandard(NAAQS)innonattainmentareas,including17countiesand4partialcounties.TheCAAwasamendedin1977toallowStatestoadoptemissionstandardsformotorvehicles.Section177oftheCAAauthorizesstatestoadoptandenforcenewmotorvehicleemissionstandardsforanymodelyearifthestandardsareidenticaltotheCaliforniastandardsandthestatesadoptthestandardsatleast2yearsbeforethebeginningofthemodelyear.California’sstandardsmustalsohavebeengrantedawaiverfromtheCAA’sprohibitionagainststateemissionstandards.Seesection177oftheCAA.AFederalcourtofappealshasruledthatstatesmayadopt,butnotenforce,CaliforniaemissionsstandardsbeforetheEPAhasactedonCalifornia’swaiverrequest.MotorVehicleManufacturersAssociationoftheUnitedStatesv.NewYorkStateDepartmentofEnvironmentalConservation,17F.3d521,534(2dCir.1994).IfastatedoesnotadoptCalifornia’sstandards,vehiclemanufacturersandothersaresubjecttotheFederalemissionsstandardsestablishedbytheEPA.Congressamendedsection177oftheCAAin1990toprohibitstatesfromtakingactionthatwouldhavetheeffectofcreatingamotorvehicleormotorvehicleenginedifferentfromamotorvehicleormotorvehicleenginecertifiedinCaliforniaunderCaliforniastandardsorotherwisecreatea“thirdvehicle.”Shortlythereafter,manystatesbegantoconsidercleanvehicleorLEVprogramsasacontrolstrategytoachieveandmaintaintheNAAQSforozone.http://www.pabulletin.comlsecure/data!vol36/36-49/2406.html5/16/2007PABulletin,Doc.No.06-2406Page4of23Congressalsorecognizedthatground-levelozoneisaregionalproblemnotconfinedtostateboundaries.Section184oftheCAA(42U.S.C.A.§751ic)establishedtheNortheastOzoneTransportCommission(OTC)toassistindevelopingrecommendationsforthecontrolofinterstateozoneairpollution.TheCommonwealthisamemberoftheOTC.ShortlyafterestablishmentoftheOTC,memberstatesbegannegotiatingwithvehiclemanufacturersforcleanercarstoaddressregionalairqualityneeds.In1998,theEPAadoptedregulationsforavoluntaryalternativeLEVprogram,calledtheNLEVprogram,reflectingthesenegotiations.UnderthisalternativeLEVprogram,vehiclemanufacturersagreedtomanufactureLEVsfor49statesasanalternativetotheCaliforniaLEVprogram.TheCommonwealthand8othernortheasternstates,aswellas23vehiclemanufacturers,optedintotheNLEVprogram,effectiveintheOTCforMY1999andoutsidetheOTCforMY2001.Inthefinal-formrulemakingpublishedat28Pa.B.5873(December5,1998),theCommonwealthadoptedthePennsylvaniaCleanVehiclesProgramundersection177oftheCAA.Inthesamefinal-formrulemaking,theCommonwealthadoptedtheNLEVprogramasacompliancealternativetothePennsylvaniaCleanVehiclesProgram.ThePennsylvaniaCleanVehiclesProgramincorporatedbyreferencetheLEVprogramofCaliforniaasa‘backstop”totheNLEVprogramintheeventavehiclemanufactureroptedoutoftheNLEVprogramandattheconclusionoftheNLEVprogram.ThePennsylvaniaCleanVehiclesProgramincorporatedbyreferencetheCaliforniaemissionstandardsforpassengercarsandlight-dutytrucks,exceptthatitdoesnotincorporatebyreferencetheCaliforniaZEVoremissionscontrolwarrantysystemsstatementprovisions.ThePennsylvaniaCleanVehiclesProgramdidnotrestricttheincorporation-by-referenceoftheCaliforniaprogramtotheCaliforniaregulationsasinforceonthedateofadoptionin1998ofthePennsylvaniaCleanVehiclesProgram.Rather,the1998incorporation-by-referenceincludedtheCaliforniaregulationswithallamendmentsandsupplementstothemovertime,asinforceatthetimeofapplicationofthePennsylvaniaCleanVehiclesProgram.TheCommonwealth’sparticipationintheNLEVprogramextendedonlyuntilMY2006,atwhichtimevehiclemanufacturerswerenolongerabletouseNLEVasacompliancealternativetotheProgram.Inpracticalterms,theNLEVprogramwasreplacedforMY2004andlaterbythemorestringentFederalTierIIvehicleemissionsregulations.VehiclemanufacturersoperatingundertheNLEVprogrambecametemporarilysubjecttotheTierIIrequirements.See65FR6698(February10,2000).CaliforniaadopteditsoriginalLEVregulations,knownasCALEVI,in1991.TheCALEVIrequirementsweregenerallyapplicableinCaliforniainMY1994.TheEPAgrantedawaiverofFederalpreemptionforCalifornia’sLEVIprogramat58FR4166(January13,1993).CaliforniaadoptedrevisedLEVregulations,knownasCALEVII,in1996forMYs2004andlater.TheEPAgrantedawaiverofFederalpreemptionfortheCALEVIIprogramat68FR19811(April22,2003).SinceneithertheFederalTierIInorCaliforniaLEVIIstandardshadbeenestablishedwhentheCommonwealthadoptedtheProgramin1998,itwasuncertainwhichprogramwouldbemoreappropriateforthisCommonwealthinthelongrun.Becauseofthis,theBoardstatedanintentioninthefinal-formrulemakingpublishedat28Pa.B.5873,5875toreassesstheairqualityneedsandemissionreductionpotentialofbothprogramsinadvanceoftheendoftheCommonwealth’scommitmenttotheNLEVprogram.http://www.pabulletin.comlsecure/datalvol36/36-49/2406.html5/16/2007PABulletin,Doc.No.06-2406Page5of23Theassessmentwascompletedpriortopublicationoftheproposedrulemaking.ItshowsthatthisCommonwealthwillexperiencemoreairpollutionreductionbenefitsfromregulatinglight-dutycarsandtrucksundertheCaliforniaLEVIIrequirementsthanundertheFederalTierIIrequirements.WiththeCaliforniaLEVIIprogram,thisCommonwealthwillachieveadditionalemissionreductionsofabout2,850to6,170tonsperyearofVOCs,3,540tonsperyearofNOand5%to11%totalreductionofsixtoxicairpollutants(includingbenzenewith7%to15%morebenefit)by2025,whenfullfleetturnoverisexpected.Highwayvehiclescontributesignificantlytotheemissionsthatformozone.Ground-levelozoneorsmogaffectsthehealthofmillionsofcitizensinthisCommonwealth,inparticularchildrenandthosewithexistingrespiratorydiseases.Theproblemisstillpervasivetodaydespiteconsiderableprogress,becausetheEPAhasfoundthatthestandardtheninplacedidnotadequatelyprotectpublichealth.Moreprotectivestandardsforozoneaswellasforfineparticulateshavebeenpromulgated.Consequently,todayabout2/3ofthecitizensinthisCommonwealthliveincountiesthatdonotattaintherevisedozonestandard.Withoutadditionalreductionsinhighwayvehicleemissions,reductionswillhavetobeobtainedfromindustrial,commercialorotherconsumersources;thesecontrolsmaynotbeascost-effectiveastheProgram.Therefore,failuretoimplementtheProgramwouldincreasethelikelihoodthatthisCommonwealthwouldnotachieveandmaintainthehealth-based8-hourNAAQSforgroundlevelozone.Furthermore,ifthestandardsarenotattainedandmaintainedinnonattainmentareas,theseareaswouldbesubjecttoadditionalrequirementsthatcouldaffecttheirindustrial/commercialfacilities.PostponementoftheProgramfromMY2006toMY2008doesnotsignificantlyaffectlong-termairqualityandeconomicbenefits.TheexistingPrograminChapter126,SubchapterDappliestovehiclemanufacturers,newvehicledealers,leasingandrentalagenciesandotherregistrants.UndertheProgram,apersonmaynotsell,import,deliver,purchase,lease,rent,acquire,receive,titleorregisteranewpassengercarorlight-dutytruck(withsomeexceptions)inthisCommonwealththathasnotreceivedcertificationfromtheCaliforniaAirResourcesBoard(CARB)forcompliancewiththeCaliforniaLEVprogramthatiscurrentatthetimeofsale,importation,delivery,purchase,lease,rental,acquisition,receipt,titlingorregistration.ToreceiveCAREcertificationforavehiclemakeandmodel,amanufacturermustdemonstratetoCAREthatthevehicletestgroupassociatedwiththespecificmakeandmodelmeetsspecifiedcriteriapollutantstandardsandthatthemanufacturer’slowemissionfleetasawholemeetstheNMOGfleetaveragestandard.InadditiontorequiringCAREcertification,theProgramrequiresthatmanufacturersdemonstratethattheCaliforniaNMOGfleetaveragestandardismetbasedonthenumberofnewlight-dutyvehiclesdeliveredforsaleinthisCommonwealth.Californiarecentlyaddedagreenhousegas(GHG)fleetaveragerequirementtoitsLEVIIprogrambeginningwithMY2009.California’sGHGprogramaddressesemissionsofcarbondioxide,methane,nitrousoxide,hydrofluorocarbons,perfluorocarbonsandsulfurhexafluoridefromLEVsofferedforsaleinCalifornia.CaliforniaadoptedaGHGfleetaverageonthebasisthatGHGstrapatmosphericheatandcontributetoglobalwarming.TheGHGfleetaveragewillhavetobemetinCaliforniatoobtainCARBcertification.http://www.pabulletin.conilsecure/data/vol36/36-49/2406.html5/16/2007PABulletin,Doc.No.06-2406

cPage6of23Therefore,thisCommonwealthwillrealizethebenefitsofCalifornia’sGHGcertifiedvehiclesthroughtheCommonwealthsexistingrequirementthatnewvehicleshaveCARBcertification.Californiaestimatesthattheprogram,whenfullyphased-in,willprovideabouta30%reductioninGHGemissionsfromnewvehiclesrequiredtocomplycomparedtothe2002fleet.TheDepartmentanticipatesthatthisCommonwealthwillachievesimilarresults.CaliforniaiscurrentlydefendingitsGHGregulationsagainstlegalchallengesfiledbytheautoindustry.ArecentreportbytheNationalAcademyofSciences’NationalResearchCouncil(NRC)foundthatCalifornia’sroleinsettingemissionstandardshasbeenscientificallyvalidandnecessarytoachievecleanairgoalsinpartsofthecountrystrugglingtocleanuptheair.ThereportalsofoundthattheCaliforniastandardshavehelpedspeeduptechnologicalairpollutioncontrolinnovations.ThereportfoundthattheCaliforniaLEVprogramhasbeenbeneficialoverallforairqualitybyimprovingmobile-sourceemissionscontrolandconfirmedthatCaliforniahasusuallyledtheEPAinestablishingstandardsforlight-dutyvehiclesandsmallnonroadgasolineengines.TheDepartmentconsultedwiththeAirQualityTechnicalAdvisoryCommittee(AQTAC)onthefinal-formrulemakingonJune8,2006.Atthatmeeting,theAQTACrecommendedthattheDepartmentpresentthefinal-formrulemakingtotheBoardforadoption.TheDepartmenthasconsultedwiththeDepartmentofTransportation(DOT)duringdevelopmentofthefinal-formrulemakinginaccordancewithsection5(a)(7)oftheact.TheDepartmentalsoconsultedwiththeCitizens’AdvisoryCouncil.Thisfinal-formrulemakingisnecessarytoachieveandmaintaintheNAAQS.ThefinalformrulemakingwillbesubmittedtotheEPAasarevisiontotheStateImplementationPlan(SIP).E.SummaryofRegulatoryRequirementsandMajorChangestotheProposedRulemakingThisfinal-formrulemakingdeletesthedefinitionsof“debit”and“ZEV--Zero-EmissionVehicle”from§121.1becausethetermsarealreadydefinedintheCaliforniaregulationsincorporatedbyreferenceinChapter126.Thefinal-formrulemalcingdeletesthedefinitionsof“NLEV”and“NLEVProgram”becausetheyarenolongerrelevant.Thefinal-formrulemakingmakestypographicalcorrectionstothedefinitionsof“fleetaverage”and“LDV-light-dutyvehicle”andamendsthedefinitionof“offsetvehicle.”Thedefinition“LDTlight-dutytruck”isamendedtoincorporateaseparatedefmitionof“lightdutytruck”usedin§129.52(relatingtosurfacecoatingprocesses)and,forpurposesofthisfinal-formrulemaking,tobeconsistentwiththeCaliforniaprogram.Theseparatedefinitionof“lightdutytruck”isdeletedasitisincorporatedintothedefinitionof“LDT--light-dutytruck.”Thefinal-formrulemakingamendsthetitleofChapter126,SubchapterDtoreflectthecessationoftheNLEVprogram.Thefinal-formrulemakingdeletestheNLEVprovisionsin§126.401(b)(relatingtopurpose)andrescinds§126.402.ThroughoutChapter126,SubchapterD,cross-referencestotheCaliforniaregulationsareupdatedtoreflectthe1999restructuringofCalifornia’sregulations.Thisfinal-formrulemakingmakesSubchapterDclearerandeasiertounderstand.Sincethe1998adoptionoftheCaliforniaprogramautomaticallyincorporatedCalifornia’sregulatoryrestructuring,theseamendmentsarenotnecessarybutaremadeforthepurposesofclaritynowandinthehttp://www.pabulletin.cornlsecure/datalvol36/36-49/2406.html5/16/2007PABulletin,Doe.No.06-2406Page7of23eventCaliforniarestructuresitsregulationsagain.Amendmentsofthisnaturearenotindividuallyaddressedinthispreamble.ThroughoutSubchapterD,thephrase“Division3”isaddedtothereferencestoTitle13oftheCaliforniaCodeofRegulations(CCR)toprovideamorecompletecitation.Division3referstoCalifornia’smotorvehicleregulationsadoptedbyCARB.AttheSeptember19,2006,meeting,theBoardapprovedanamendmentto§126.401ofthefinal-formrulemakingtoaddsubsection(d).Subsection(d)statesthattheDepartmentmaynotimplementorenforceavehicleemissionstandardthatisnotlegallypermittedtoberegulatedundertheCAAorotherapplicableFederalorStatelaworregulation.Theamendmentsto§126.411(a)(relatingtogeneralrequirements)postponethemodelyeartowhichtheProgramwillfirstapplyfromthemodelyearbeginningafterDecember5,2000,toMY2008.Section126.411(a)(relatingtogeneralrequirements)isamendedinthefinal-formrulemakingtoinclude“titled.”NowtheProgramwillapplynotonlytoallnewpassengercarsandlight-dutytruckssold,leased,offeredforsaleorlease,imported,delivered,purchased,rented,acquired,receivedorregisteredinthisCommonwealth,butalsothose“titled”inthisCommonwealth.InthisCommonwealth,refusingtitlingforanon-CARBcertifiedvehicleoffersthemostequitableandeffectivewaytoenforcethevehicleregistrationrequirement,sinceavehiclemustbetitledinthisCommonwealthtoberegisteredinthisCommonwealth.ProhibitingtitlingofvehiclesnotcertifiedbyCARBwillprotectindividualsfrompurchasingavehicle,whetherin-Stateorout-of-State,thatcannotberegisteredinthisCommonwealth.Correspondingchangesaremadeto§sS126.412(a),126.413(a)(11)and(b)and126.431(a),(c)and(d)(relatingtoemissionrequirements;exemptions;andwarrantyandrecall).Theseamendmentstothefinal-formrulemakingworkintandemwiththedeletionoftheproposedexemptionfromtheProgramin§126.413(a)(14)forvehiclespurchasedout-of-State,whichisdescribedasfollows.Amendmentsto§126.411(b)(1)updatethecross-referenceto,andretaintheCommonwealth’sspecificexclusionof,California’sZEVprogrambyreplacing“1960.1(g)(2)(footnote9)”with“1962.”Thisisanexampleofthecross-referenceamendmentsreflectingCalifornia’s1999regulatoryrestructuring.Theamendmentsto§126.412(a)postponethefirstmodelyearforwhichapersonisprohibitedfromselling,importing,delivering,purchasing,leasing,renting,acquiring,receivingorregisteringavehiclesubjecttotheProgramifthevehiclehasnotreceivedCARBcertificationfromthemodelyearbeginningafterDecember5,2000,toMY2008.“Title”isaddedtothelist,aspreviouslydescribed.Theamendmentsto§126.412(b)changethefirstmodelyearforwhichcompliancewiththeNMOGfleetwideaverageisrequiredfromthemodelyearbeginningafterDecember5,2000,toMY2008.LanguageregardingCalifornia’sZEVprogramisdeletedfromsubsection(b)becauseCAREmovedtheZEVprovisionsoutofthecross-referencedsection.Aspreviouslydiscussed,thefinal-formrulemakingretainstheCommonwealth’sspecificexclusionofCalifornia’sZEVprogramin§126.411(b)(1).Section126.412(d)specifiesthe3-yearearly-creditearningperiodwithinwhichvehiclemanufacturersmustcomeintocompliancewiththeNMOGfleetaverage.Thefinal-formhttp://www.pabulletin.comlsecure/data!vol36/36-49/2406.html5/16/2007PABulletin,Doc.No.06-24061Page8of23rulemakingclarifiesthatmanufacturersmaycarryforwardNMOGcreditsfullywithoutdiminutionduringthe3-yearperiod(MYs2008--2010),andthecreditsmaybeusedinanyorallofthe3yearswithoutanylossofthecredits.Amendmentsto§126.413(a)(2)clarifytheoriginalintentofthesection,whichistoallowavehicledealertotransferanon-CARBcertifiednewvehicleaslongasthevehiclewillnotultimatelybesoldinthisCommonwealthasanewvehicle.Anamendmentto§126.413(a)(6)clarifiestheintentoftheCommonwealthwithrespecttoenforcementoftherulesregardingdailyleaseandrentalcompaniesundertheProgram.Thefinal-formrulemakingincludesanexplanationin§126.413(a)(6)thatalight-dutyvehicleisdeemedtobeprincipallyoperatedoutsideofthisCommonwealthifitisregisteredoutsideofthisCommonwealthinaccordancewiththerulesoftheInternationalRegistrationPlanorasuccessorplanforregisteringvehiclesinternationally.UndertheInternationalRegistrationPlan,rentalcarcompaniescannotavoidregisteringacertainnumberofvehiclesinthisCommonwealthtoavoidcompliancewiththeProgram.Theamendmentto§126.413(a)(11)conformsthemodelyearregistrationcut-offforvehicleexemptionwiththeMY2008startdateofCARBcertificationandNMOGfleetaveragerequirements.“Titled”isaddedtothisparagraph,aspreviouslydescribed.New§126.413(a)(13)exemptsvehiclestransferredforthepurposeofsalvage.ThisparagraphisaddedtoensurethatsalvageandmetalscrapoperationsinthisCommonwealthmayacceptsalvagednewmotorvehiclesthatmaynothaveCARBcertification.Thefinal-formregulationdeletes§126.413(a)(14),whichwasincludedbytheBoardintheproposedrulemaking.Thisamendmentwouldhaveexemptedvehiclespurchasedorleasedfromanout-of-StatedealerbyaresidentofthisCommonwealthforthepersonaluseoftheresidentandnotforimmediateresale.TheamendmentwasdesignedtoreflecttheintentionoftheCommonwealthnottodenyregistrationofanon-CAREcertifiedvehicleinthissituation.However,thatisnolongertheCommonwealth’sintention.TheCommonwealthwilldenytitleandregistrationofnon-CAREcertifiedvehicles,regardlessofwhetherthevehiclesarepurchasedin-Stateorout-of-State,thusensuringequitabletreatmentofin-Stateandout-of-Statepurchaserswithouttheneedfortheproposedexemption.Additionally,theproposedexemptionwouldhavecomplicatedenforcementandincreasedthepossibilityofreducedemissionscredit.Finally,theproposedexemptionwasrejectedbyindustrycommentators.Hence,thefinal-formrulemakingdeletesproposed§l26.413(a)(14).Section126.413(b)requiresapersonseekingtoregisteranexemptedvehicletoprovidesatisfactoryevidencedemonstratingthattheexemptionisapplicable.Thefinal-formrulemakingrequiresthistoobtaintitletoanexemptedvehicleforthereasonspertainingtotitlingpreviouslydescribed.AmendmentstothenewmotorvehicletestingprovisionsrequirevehiclemanufacturerstoprovideCARBtestingdeterminationsandfindingstotheDepartmentuponrequest.Thefinal-formrulemakingrequiresthattheDepartment’srequestbeinwriting.Therevisedsectionsare§126.421(b),126.422(b),126.423(b),126.424(b)and126.425(b).Section126.431(b)requireseachvehiclemanufacturertosubmittotheDepartmenthttp://www.pabulletin.comlsecure/datalvol36/36-49/2406.html5/16/2007PA.Bulletin,Doc.No.06-2406Page9of23failureofemission-relatedcomponentsreports.TheamendmentsallowavehiclemanufacturertosubmittotheDepartmentcopiesofthereportsthemanufacturersubmittedtoCAREforpurposesofcompliancewiththissubsection.Thefinal-formrulemakingspecifiesthatthesereportsmustonlybesubmittedwhenrequestedinwriting.Theamendmentsto§126.431(c)clarifythatanyvoluntaryorinfluencedemission-relatedrecallcampaigninitiatedbyanymotorvehiclemanufacturerundertheCaliforniaprogramshallextendtoallmotorvehiclessold,leased,offeredforsaleorleaseorregisteredinthisCommonwealththatwouldbesubjecttotherecallcampaignifsold,leased,offeredforsaleorleaseorregisteredasanewmotorvehicleinCalifornia.Thepurposeof§126.431(c)istoensurefullprotectiontoconsumersinthisCommonwealth.Forthesakeofclarity,thefinal-formrulemakingexemptsmotorvehiclesfromthisrequirementif,within30daysofCARE’sapprovalofthecampaign,themanufacturerdemonstratesinwritingtotheDepartment’ssatisfactionthatthecampaignisnotapplicabletovehiclessold,leased,offeredforsaleorlease,titledorregisteredinthisCommonwealth.AnexampleofwhenarecallcampaignwouldnotbeapplicabletovehiclesinthisCommonwealthwouldbeifamanufacturerdemonstratedthatthenoncompliancewascorrectedforordidnotoccurinthefirstplaceinthevehiclessold,leased,offeredforsaleorleaseorregisteredinthisCommonwealth.New§126.431(d)providesthatanorderissuedbyCARBorenforcementactiontakenbyCARBtocorrectnoncompliancewithanyprovisionofTitle13CCR,whichresultsinjherecallofanyvehicleunderTitle13CCR,Chapter2,shallbedeemedtoapplytoallmotorvehiclessold,leased,offeredforsaleorleaseorregisteredinthisCommonwealththatwouldbesubjecttotheorderorenforcementactionifsold,leased,offeredforsaleorleaseorregisteredasanewmotorvehicleinCalifornia.Thepurposeof§126.431(d)istoensurefullprotectiontoconsumersinthisConmionwealth.Forthesakeofclarity,thefinal-formrulemakingexemptsmotorvehiclesfromthisrequirementif,within30daysoftheCAREaction,themanufacturerdemonstratesinwritingtotheDepartment’ssatisfactionthattheactionisnotapplicabletovehiclessold,leased,offeredforsaleorlease,titledorregisteredinthisCommonwealth.AnexampleofwhenarecallactionwouldnotbeapplicabletovehiclesinthisCommonwealthwouldbeifamanufacturerdemonstratedthatthenoncompliancewascorrectedforordidnotoccurinthefirstplaceinthevehiclessold,leased,offeredforsaleorleaseorregisteredinthisCommonwealth.VSection126.432(a)(relatingtoreportingrequirements)requiresthateachvehiclemanufacturersubmitannuallytotheDepartment,within60daysoftheendofeachmodelyear,areportdocumentingthetotaldeliveriesforsaleofvehiclesineachenginefamilyoverthatmodelyearinthisCommonwealthforpurposesofdeterminingcompliancewiththeProgram.TheamendmentschangethefirstmodelyeartowhichthisrequirementappliesfromthemodelyearbeginningafterDecember5,2000,toMY2008.Theamendmentsto§126.432changetheterm“enginefamily”to“testgroup”toconformtoCalifornia’schangeinterminology.Subsection(d)requiresthatcompliancewiththeNMOGfleetaverageforMYs2008--2010bedemonstratedfollowingthecompletionofMY2010.Newvehicledealerresponsibilitiesareclarifiedintheamendmentsto§126.441(relatingtoresponsibilitiesofmotorvehicledealers),whichreiteratestheprohibitionagainstanewvehicledealerselling,offeringforsaleorleaseordeliveringavehiclesubjecttotheProgramunlessthevehiclehasreceivedtherequisiteCAREcertification.Thisfmal-formrulemakingadds§126.451(relatingtoresponsibilitiesofthehttp://www.pabulltin.com/secure/dataJvol36/36-49/2406.html5/16/2007PABulletin,Doc.No.06-2406CPage10of23Department),whichrequirestheDepartmenttomonitorandadvisetheBoardinspecificwaysofanyproposedorfinal-formrulemakingsunderconsiderationbyCARBthatamendormodifytheCaliforniaLEVprogram.ThisamendmentalsorequirestheDepartmenttosubmitcommentstoCARBonproposedorfinalCARBrulemakings.ThisamendmentisdesignedtoensurethattheBoardandotherresidentsofthisCommonwealthareinformedaboutchangesthatmightoccurintheCaliforniaprogramandablefullytoappreciatetheimpactofaCARBrulemakingonresidentsofthisCommonwealth.Thefinal-formrulemakingclarifiesthattheDepartment’sresponsibilitiesunderthissectionapplyonlytotheprovisionsoftheCaliforniaLEVprogramincorporatedbyreferenceintheProgram.AttheSeptember19,2006,meeting,theBoardapprovedanamendmentto§126.451ofthefinal-formrulemakingtoaddparagraph(3).Paragraph(3)requirestheDepartment,inconjunctionwiththeDOT,tostudyandevaluatethefeasibilityofmodifyingthePennsylvaniavehicleemissioninspectionprogram(JIMprogram).TheI/MprogramisdifferentfromtheProgramandismandatedbytheCAAin25countiesinthisCommonwealth.Section126.451(3)requiresthat,inperformingthestudyandevaluation,theDepartment,inconjunctionwiththeDOT,willconsidertheadditionalreductionsinNOR,VOCsandotherpollutantstobeachievedthroughimplementationofTitle13CCR,Division3,Chapter1and2requirementsandtosubmitthefindingsandrecommendationstotheBoardwithin9monthsoftheeffectivedateofthisfmal-formrulemaking.Atthesamemeeting,theBoardapprovedanotheramendmentto§126.451whichrequirestheDepartmenttonotifytheBoardassoonaspossible,butnolaterthan6monthsaftertheeffectivedateofthisfinal-formrulemaking,ofthespecificreductionsinNOR,VOCs,carbonmonoxideandotherreductionsapprovedbytheEPAasaresultoftheincorporationoftheProgramintheCommonwealthsSIP.ThereportistoincludeacomparisonoftheincrementalbenefitreductionsderivedusingEPA-approvedmethodologyversusreductionsthatwouldhavebeenachievedundertheTierIIstandards.F.SummaryofCommentsandResponsesontheProposedRulemakingTheBoardapprovedpublicationoftheproposedrulemakingatitsmeetingonOctober18,2005.Theproposedrulemakingwaspublishedat36Pa.B.715(February11,2006).PublichearingswereheldonMarch14inPittsburgh,March20inHarrisburgandMarch28inBroomall(Philadelphiaarea).CommentswereacceptedfromFebruary11,2006,toMay8,2006.TheBoardreceivedarecordnumberofcomments--about4,810letters,postcardsandemails--fromapproximately4,400commentators.ThevastmajorityofcommentatorssupportedtheProgramandtheregulatorychanges.IndustryrepresentativesgenerallyopposedtheProgramandsomeoftheregulatorychanges.GenerallysupportivecommentatorsincludedtheSierraClub,theAmericanLungAssociation,CitizensforPennsylvania’sFuture,PennEnvironment,GroupAgainstSmogandPollution,theLeagueofConservationVoters,numerousfaith-basedorganizations,severalthousandindividuals,SenatorsJosephConti,JimFerlo,VincentFumoandConstanceWilliams,andRepresentativesMichaelGerber,BabetteJosephs,CharlesMcllhenney,PhyllisMundy,ScottPetriandJoshShapiro.CommentatorswhogenerallyopposedtheProgramorproposedrulemaking,orsomeaspectthereof,includedtheAllianceofAutomobileManufacturers(Alliance),thePennsylvaniaAAAFederation,thePennsylvaniaAutomotiveAssociation(anautomobiledealersassociation),thePennsylvaniaChamberofBusinessandhttp://www.pabulletin.comlsecure/dataJvol36/36-4912406.html5/16/2007PABulletin,Doe.No.06-2406Page11of23Industry,theAssociationofInternationalAutomobileManufacturers,GeneralMotors,DaimlerChrysler,SierraResearch,Inc.(SierraResearch)andSenatorsMaryJ0WhiteandRogerMadigan.TheIndependentRegulatoryReviewCommission(IRRC)andtheHertzCorporationalsosubmittedcommentsinregardtotheproposedrulemaking.GeneralMotorsandDaimlerChryslersupportedandincorporatedbyreferencethecommentsoftheAlliance.DaimlerChryslersupportedandincorporatedbyreferencethecommentsofSierraResearch.Onlytheprimarycommentator(specifically,AllianceorSierraResearch)isidentifiedasthecommentatorforcommentswhichGeneralMotorsorDaimlerChryslerdidnotexpresslystateindependentlyoftheAllianceorSierraResearchcomment.TheDepartmenthaspreparedaCommentandResponsedocumentinwhichtheDepartmentrespondstocommentsreceivedduringthepubliccommentperiod.TheCommentandResponsedocumentisavailableontheDepartmentswebsiteatwww.depweb.state.pa.us(QuickAccess:PublicParticipation)TheCommentandResponsedocumentprovidesdetailedresponsestothesecommentsandexplainstheDepartment’sposition.Thefollowingisadiscussionofthecommentsreceivedduringthepubliccommentperiodorganizedaccordingtosubjectmatter.CommentsregardingtheregulatorylanguageareaddressedandasummaryofcommentsthataddresstheProgramasawholearealsoprovided.CommentsontheProposedRegulatoryLanguageinAnnexAThePennsylvaniaAutomotiveAssociationandtheAlliancecommentedthattheproposedamendmentto



# §126.413(a)exemptingnewvehiclespurchasedout-of-StatebyresidentsofthisCommonwealthwouldcreateanunevenmarketplace.Theynotedthatwhilethereislittleornopricedifferentialtoday,inthefutureafterimplementationoftheGHGstandards,pricecouldbecomeanissue.TheyexpressedconcernthatpermittingresidentstobringnoncompliantnewvehiclesintothisCommonwealthcouldaffectdealersalesinthisCommonwealthandsalestaxrevenuestoStateandlocalgovernment.TheysuggestedthatthereshouldbethesamelevelofemissionsstandardsfornewvehiclesbroughtintothisCommonwealthbyresidentsasfornewvehiclessoldbydealersinthisCommonwealth.TheystatedthattheexemptionwouldmakeitdifficulttoenforcetheProgram.Thesecommentatorssaidthattheemissionsbenefitcouldbereducedifthisexemptionwereadopted.TheAlliancesuggestedthattheexemptionberemovedandProgramimplementationshouldbeconsistentwiththeEPA’s“PolicyofCross-BorderSalesofCaliforniaCertifiedVehiclesfor2004andLaterModelYears,”whichallowsin-Stateandout-of-StatedealerstosellaCaliforniavehicletoanycustomer.TheAlliancealsocommentedthattheCommonwealthshouldestablisharegistrationenforcementprocess.TheDepartmentagreesthattheproposedexemptionshouldbedeletedandisthereforedeletingproposed



# §126.413(a)(14).Theproposedamendment,whichwasaddedtotheproposedrulemakingbytheBoardonOctober18,2005,wasofferedtoensureequitablevehicleregistrationrequirementsinthisCommonwealthundertheassumptionthatthiswouldreflecttheanticipatedDOTapproachtoregistration.TheDepartmentagreesthatpurchasersneedtobetreatedsimilarly.Additionally,theexemptionwouldhavecomplicatedenforcementandincreasedthepossibilityofreducedemissionscredit.Usingthetitlingprocessoffersthemostequitableandeffectivewaytoenforcethevehiclehttp://www.pabulletin.comlsecure/datalvol36/36-49/2406.html5/16/2007PABulletin,Doe.No.O6-24O6Page12of23registrationrequirement,sinceavehiclemustbetitledinthisCommonwealthtoberegisteredinthisCommonwealth.ProhibitingtitlingofvehiclesnotcertifiedbyCAREwillprotectindividualsfrompurchasingavehicleout-of-StatethatcannotberegisteredinthisCommonwealth.Inaddition,individualswhopurchasevehiclesfromout-of-StatedealersworkwithaissuingagentinthisCommonwealthtotitleanewvehicleinthisCommonwealth.Totitleavehicle,theissuingagentmusthaveaccesstoaManufacturer’sCertificateofOrigin(MCO),adocumentthatincludesastatementabouttheemissionstandards(forexample,thatthevehicleiscertifiedbyCARBorbytheEPA,orisa50-statevehiclethatcanbesoldinTier2orCALEVIIjurisdictions).RegistrationdoesnotrequireaccesstoanMCO.TheCommonwealthwillrequireissuingagentstocertifythatthevehiclecompliesbasedontheMCO.TheCommonwealthwillmakeaspecificoutreachefforttoadvisedealersinthecontiguousstatesaboutthePennsylvaniarequirements.Aslongasout-of-StatedealersofferCaliforniaLEVvehicles,residentsofthisCommonwealthwillbeabletopurchasevehiclesfromneighboringstates.Hertzcommentedonexisting§126.413(a)(6),whichexemptsfromtheProgramalightdutyvehicleheldfordailyleaseorrentaltothegeneralpublicthatisregisteredandprincipallyoperatedoutsideofthisCommonwealth.Hertzcommentedthatbecauseoftheuncertaintycreatedindeterminingwhenavehicleis“principallyoperatedoutsidetheCommonwealth,”meetingthisrequirementwouldimposeextremeburdensonthewayHertzmanagesitsvehiclefleetandseverelyrestrictthevehiclechoicesavailabletotherentingpublic.HertzrequestedaclarificationregardingvehiclesregisteredoutsidethisCommonwealth.HertzsuggestedthatrentalvehiclesengagedininterstatecommerceshouldbedeemedtobeprincipallyoperatedoutsideofthisCommonwealthandthusnotsubjecttotheProgram.UndertheInternationalRegistrationPlanformula,rentalcarcompaniesregisteracertainminimumnumberofvehiclesineachstatebasedongrossrevenueintheprecedingyear.TheInternationalRegistrationPlanisaregistrationreciprocityagreementamongstatesoftheUnitedStatesandprovincesofCanadaprovidingforpaymentofregistrationfeesonthebasisoftotaldistanceoperatedinalljurisdictions.AdditionalinformationabouttheInternationalRegistrationPlancanbefoundatwww.irponline.org.TheInternationalRegistrationPlaniseffectiveinthe48contiguousstatesand10Canadianprovinces.Onthisissue,IRRCaskedwhethertheBoardintendedtorequirerentalcarcompaniestoensurethatanycarthatcouldpossiblybeusedinthisCommonwealthcomplywithCARBstandardsorwhetherrentalcarcompanieswouldmerelyberequiredtohaveallvehiclesregisteredinthisCommonwealthcomplywiththestandards.IRRCaskedthattheBoardclearlydelineatetherequirementsinthefinal-formrulemaking.TheDepartmentagreeswithHertz’suggestedinterpretationoftheexistingregulation.Thefinal-formrulemakingincludesanamendmentto§l26.413(a)(6)toclarifytheintentoftheCommonwealthwithrespecttoenforcementoftheregulationsregardingdailyleaseandrentalcompaniesundertheProgram.TheDepartmentdoesnotintendtorequirerentalcarcompaniestoensurethatanycarthatcouldpossiblybeusedinthisCommonwealthcomplieswithCAREstandards.TheDepartmentdoesnotintendtointerferewiththenormalbusinesspracticesofNationalrentalcarcompanies.TheInternationalRegistrationPlanensuresthatrentalcarcompaniescannotavoidregisteringacertainnumberofvehiclesinthisCommonwealthtoavoidcompliancewiththeProgram.MY2008andlaterrentalvehiclesregisteredinthisCommonwealthmustbecertifiedbyCARE.Thefinal-formrulemakingincludesanexplanationin§126.413(a)(6)thatalight-dutyvehicleisdeemedtobeprincipallyoperatedoutsideofthisCommonwealthifitisregisteredoutsideofthishttp://www.pabulletin.conilsecure/datalvol36/36-49/2406.html5/16/2007PABulletin,Doe.No.06-2406Page13of23CommonwealthinaccordancewiththeInternationalRegistrationPlanorasuccessorplanforapportioningvehiclesregistrationfeesinternationally.TheAlliancecommentedthattheCommonwealthshouldestablisharegistrationenforcementprocesstogetfullSIPcredit.TheAlliancenotedthataregistrationenforcementprocessbasedontheMCOshowingthatavehicleiscertifiedforsaletoCaliforniastandardshasbeensuccessfullyimplementedinNewYork,MassachusettsandVermont,butthatMainehasnotimplementedaregistrationenforcementprocessanddidnotreceivefullSIPcredit.TheDepartmentagrees.TheexistingregulatorylanguagerequiresnewsubjectvehiclesregisteredinthisCommonwealthtobethosecertifiedbyCARE.TheCommonwealthhasconsultedwiththeDOTontheregistrationenforcementprocess.TheDOThasrecommendedaddingtitlingtotheDepartmentregulationbecausetotitleavehicle,theissuingagentmusthaveaccesstotheMCO.AvehiclemustbetitledinthisCommonwealthtoberegisteredinthisCommonwealth.TheAlliancequestionedthelegalityofthedelegationtoCARBthat



# §126.431(d)represents(pertainingtoenforcementactionstakenbyCAREapplyingtoPennsylvania)andsuggestedthatitunlawfullystripsmanufacturersoftheirabilityinaPennsylvaniacourttocontestthevalidityatlawofanyCAREenforcementactionastovehiclesinthisCommonwealth.TheAlliancesuggestedthatonewaytheDepartmentcouldreducethepracticalconcernsthatthecommentatorsuggestedareassociatedwiththisissuewouldbetoadoptlanguagesimilartoRhodeIsland’sapproachbyaddingthefollowingclausetoproposed



# §126.431(c)and(d):“exceptwherethemanufacturerdemonstratestotheDepartment’ssatisfactionthatsaidactionisnotapplicabletosaidvehicle.’TheDepartmentdoesnotagreethatthereisalegalissueasdescribedbythecommentator.Thepurposeof 

# §126.431(c)and(d)istoensurefullprotectiontoconsumersinthisCommonwealthpertainingtorecalleffortstakenbyCAREorinitiatedbymanufacturersforvehiclesthataresold,leased,offeredforsaleorlease,registeredortitledinthisCommonwealth.Forthesakeofclarity,thefinal-formrulemakingaddslanguagesimilartothatsuggestedbythecommentatortoallowamanufacturertheopportunitytodemonstratethatanorderissuedorenforcementactiontakenbyCARBoravoluntaryorinfluencedrecallcampaigntocorrectnoncompliancewithaprovisionofTitle13CCRisnotapplicabletovehiclessold,leased,offeredforsaleorleaseorregisteredinthisCommonwealth.Anexamplemightbeifamanufacturerdemonstratedthatthenoncompliancewascorrectedforordidnotoccurinthefirstplaceinthevehiclessold,leased,offeredforsaleorleaseorregisteredinthisCommonwealth.IRRCnotedthattheBoardindicatesthat



# §126.412(d)isintendedtoallowmanufacturerstocarryforwardNMOGcreditsfullyfora3-yearperiodwithoutalossofthosecreditseachyear.IRRCcommented,however,thatthisisnotclearlystatedinthissection.IRRCsuggestedthatthisprovisionshouldbeamendedtoclarifytheBoard’sintentions.TheDepartmentagreesthat



# §126.412(d)allowsmanufacturerstocarryforwardNMOGcreditsfullyfora3-yearperiodwithoutalossofthosecreditseachyear.Thefmal-formrulemakingclarifiesin



# §126.412(d)thatthesecreditsmaybecarriedforwardwithoutdiminutionduringthe3-yearperiod(MYs2008through2010).TheAlliancecommentedthattheNMOGfleetaveragetransitionmechanismintheproposedrulemakingwasnotadequate.TheAlliancestatedthatotherstates,forexampleMassachusetts,VermontandNewYork,includedatransitionmechanismthatallowedcredits/debitstobeearnedduringthetransitionperiod,whichistheperiodrequiredforcreditsthatwereearnedinCaliforniatocompletelyexpire(3years).TheAlliancehttp://www.pabulletin.comlsecure/datalvol36/36-49/2406.html5/16/2007PABulletin,Doe.No.O6-24.

cPage14of23recommendedthatifanNMOGfleetaveragerequirementismaintained,theCommonwealthshouldadopttheseprovisions.TheDepartmentagreesthattheappropriatecredit-earningperiodis3years.Thecommentator’sreferencetotheapproachadoptedbyMassachusetts,VermontandNewYork,however,isinappositesincethosestatestransitionedinpracticaltermsdirectlyfromCALEVItoCALEVII,withouthavingadoptedNLEVasacompliancealternative.InthisCommonwealth,creditscouldnotbefairlydeterminedforamodelyearbeforeMY2006becausemostvehiclessoldinthisCommonwealthwouldhavebeenTier2vehicles,whereascredits(anddebits)arecalculatedbycomparingtheactualfleetaverageofCARB-certifiedvehicleswiththerequiredfleetaverage.Consequently,creditscouldbeearnedforonlyasmallnumberofvehicles.TheCommonwealthisadoptingamechanismthatallowscreditstobeearnedduringthetransitionperiodofMYs2008through2010.WhileCaliforniadiscountsthesecreditsafterthefirstyear,theCommonwealthwillallowfullcreditoverMYs2008through2010.Languageclarifyingthisfullcredithasbeenaddedtothefinal-formrulemaking.Thisapproachdoesnotpresentidenticalityissues.TheAlliancealsocommentedthatbyadoptingandattemptingtoenforcetheCaliforniaFleetNMOGaverage,theCommonwealthwillviolatetheCAA.TheAlliancesaidthatCalifornia’sfleetaverageschemeincludestheopportunityformanufacturerstoearncreditsin1yearbyhavingalowerfleetNMOGaveragethanrequiredandspendcreditsinalateryearbyhavingafleetNMOGaveragehigherthanotherwiserequired.TheAlliancearguedthatamanufacturercouldhaveearnedasubstantialamountofcreditsinCaliforniaduring2005through2007andthenusethosecreditsin2008through2010tooffsetahigherthanotherwiserequiredfleetNMOG,butthatbecausetheCommonwealth’sregulationdidnottakeeffectuntil2008,themanufacturerwouldnothaveearnedanycreditsinthisCommonwealthin2005through2007andthereforeaccumulatedsignificantdebitsinthisCommonwealthin2008through2010bysellingtheverysamemixofvehiclesasitsoldinCaliforniathoseyears.TheAllianceconcludedthatthiswouldleadtoalackofidenticalityin2011astherewouldbetwodifferentstandardsasaresultofthedifferencesincreditcounting,violatingsection177oftheCAAonitsownandbyrequiringmanufacturerstolimitthesalesofCaliforniacertifiedvehiclesortocreateathirdvehicle.TheDepartmentdisagreesthattheadoptionorenforcementoftheNMOGfleetaverageinthisCommonwealthwillleadtoalackofidenticalityorotherwiseviolatetheCAA.Thereasonsaresetforthintheprecedingparagraph.GeneralMotorsandtheAlliancesuggestedrequiringonlyNMOGfleetaveragereporting,asopposedtocompliance.TheywrotethatfleetaverageNMOGisdeterminedbysalesmixandthatthesalesmixinthisCommonwealthisdifferentthanthesalesmixinCaliforniabecauseofdifferencesinconsumerdemand.ThesecommentatorssaidthattocomplywiththefleetNMOGaverage,manufacturersmayneedtorestrictsalesofcertainmodelsinthisCommonwealththatarenotrestrictedinCaliforniaandthatconsumerswouldthenkeeptheirolder,higheremittingvehicleslongersincetheywouldbeunabletopurchasethenewvehiclestheywanted.TheDepartmentrespondsthatitisunlikelythatthesalesmixinCaliforniadifferssignificantlyoverallfromthesalesmixinthisCommonwealth.(ThisisfurtherdescribedunderCommentsRegardingEconomicIssues.)ThesecommentatorshaveprovidednoevidencethatcertainmodelshavebeenrestrictedinotherstatesadoptingtheCalifornialowemissionprogramonanyparameterofconcerntopurchasers.Inmanycases,manufacturersmakebothaCaliforniaandaFederalversionofaspecificenginefamily.Manyfactorswillinfluencepurchaseofnewvehicles.ThesecommentatorshavenotpresentedanyevidencethatconsumerswouldkeepoldervehicleslongerbasedondifferencesduetoNMOGfleetaverages.Therefore,therequestedchangeisnotmadeinthehttp://www.pabulletin.com!secure/datalvol36/36-49/2406.html5/16/2007PABulletin,Doc.No.06-2406Page15of23final-formrulemaking.GeneralMotorsalsoclaimedthatbyrequiringreporting,theBoardcouldevaluatethedifferencesbetweentheCaliforniaandPennsylvaniasalesmixforeachmanufacturerandassesstheproblemsthatwouldbecausedbyrequiringfleetNMOGcompliance.Iftheindustry-widelevelswerebelowthefleetaveragestandard,therewouldnotbeanyneedtorequirecompliance.TheDepartmentdisagreesthattheexistingorfinalamendmentstotheProgramwillpresentacompliancedifficultyforautomakcrstoadegreethattheDepartmentmust“assess”theexistingPennsylvania-specificNMOGfleetaveragerequirementbeforeimplementation.TheDepartmentbelieves,givenautomakers’currentcollectiveabilitytocomplywiththeNMOGfleetaverageinotherstates,thatautomakerscollectivelycanmeettherequirementinthisCommonwealth.Furthermore,basedonCARB’sanalysisofitsGHGprovisions,theDepartmentisconfidentautomakerswillbeabletocomplywiththePennsylvania-specificNMOGfleetaveragerequirementinthefuture.ThecommentatorprovidednospecificinformationonwhyitbelievesitcannotcomplywiththeNMOGfleetaverageinthisCommonwealth.TheDepartmentaddsthatrequiringonlyreportingwithoutenforcementwouldlikelypresentproblemsforearningemissionreductionSIPcreditsfromtheEPA.TheAlliancestatedthatsection177oftheCAAproblems(ofidenticality)donotariseifastateonlyrequiresmanufacturerstoreportfleetNMOGaverage.Forthereasonspreviouslydescribed,theDepartmentdisagreesthattheProgramorthefinal-formrulemakingraisesidenticalityproblems.IRRCcommentedthatsubsection(b)in§126.421--126.425(relatingtoapplicablenewmotorvehicletesting)requiresamanufacturertoprovidecertaintypesofinformationtotheDepartment“uponrequest.”IRRCaskedunderwhatcircumstancestheDepartmentwouldmaketherequest.IRRCstatedthattheBoardshouldclearlyidentifythetypeofrequestitwillmaketothemanufacturersandthattherequestshouldbeinwriting.TheDepartmentrespondsbyexplainingthatthesesectionsassurethatdocumentsregardingthecomplianceofvehiclesthroughouttheentireproductionprocess(includingdocumentsensuringthatvehiclesaremanufacturedtomeettheapplicablecertificationstandardsthroughouttheirusefullife)areavailabletotheCommonwealth.TheDepartmentanticipatesthattheserequestswillbeinfrequent.Theycouldbetriggeredbyreportsfromdealers,vehicleownersorotherstatesimplementingtheCaliforniaprogramregardingspecificmakesormodels.SomeofthesedocumentsarenotdirectlyobtainablefromCARBbecauseofconfidentialityagreements.TheDepartmenthastheauthoritytoenterintosimilarconfidentialityagreementswithmanufacturers,ifnecessary,toreceivereports.TherequestswouldbetoprovidetotheCommonwealththespecifickindsofdocumentsalreadyinexistencerelativetoaspecifictestgroupinCalifornia:forexample,“newvehiclecertificationtestingdeterminationsandfmdingsmadebyCARB”under§126.421(b).TheDepartmentaddedlanguagetoeachofthesesectionsstatingthattheserequeststothemanufacturerwillbemadeinwriting.TheDepartmentalsoaddedparallel“uponrequest”languageto§126.431(b)becauseofcommentduringtheproposedrulemaking.TheAlliancecommentedthattheCommonwealthwouldnotfindreportsoffailuresofemission-relatedcomponentsrequiredin§126.431(b)ofmuchvaluebecausetheDepartmenthasalreadyproposedtoextendemission-relatedactionssuchasrecallsapplicableinCaliforniatothisCommonwealth.Tosaveresources,theAlliancesuggestedthatthesereportsshouldbeavailableonlyuponrequestandnotedthatthislanguagehasbeenincludedinotherstates.TheDepartmentagreestoreducethereportingrequirementshttp://www.pabu1letin.com/secure/dataJvol36/36-49/2406.html5/16/2007PABulletin,Doe.No.O6-24.O6Page16of23byaddinglanguagethatreportsinthesectioncanbemadeavailableuponawrittenrequestfromtheDepartmentratherthanprovidedroutinely.GeneralCommentRegardingProposedRulemakingIRRCcommentedthatSenatorsMadiganandWhitesubmittedaletteronMarch27,2006,expressingsupportforTierIIasanalternativetotheCaliforniaprogram.IRRCnotedthat,inaddition,theSenatepassedSB1025byavoteof27to20,whichwouldrevivetheregulatoryframeworkinitiatedin1998andgivetheautomobileindustrytheoptionofcomplyingwitheithertheCARBregulationsorTierII.IRRCcontinuedthatcommentatorsfortheautomobileindustryalsorecommendedthattheBoardadopttheTierIIprogram.IRRCsaidtheindustrycommentatorsclaimitisacomparable,oranevenbetter,programforreducingairpollutionandthattheeconomicimpactsontheautomobileindustryandconsumerswillnotbeasgreatasthoseimposedbyCARBregulations.IRRCstatedthatinitsresponsetotheseconcerns,theBoardneedstoexplainwhyandhowtheCARBregulationsaddresstheissuesofenvironmentalprotectionandcost-effectiveness,andthattheDepartmentshoulddemonstratehowitsregulationwillgenerategreaterbenefitsforpublichealthandthisCommonwealth’snaturalresourcesatacostthatisaffordable,reasonableandcompetitivewithalternativeregulatoryapproaches.TheDepartmentdisagreeswiththecharacterizationthatSB1025wouldhaverevivedtheregulatoryframeworkinitiatedin1998.ThevoluntaryNLEVprogramwasadoptedasanopt-inprogram,thatis,ifasufficientnumberofstatesandautomakersoptedin,compliancewiththatprogramwouldbeinplaceintheOzoneTransportRegionbeginninginMY1999.TheNLEVprogramprovidedacomplexsystemofadverseconsequencesforfailingtofulfillcommitments.SB1025,ontheotherhand,offerstheautoindustrytheoptionofcomplyingwithCaliforniastandardsorthelessstringentFederalTierIIstandards,withnoconsequencetoindustryforchoosingthelessstringentstandards.SB1025wouldalsohaveabrogatedtheexistingProgramandprohibitedtheBoardfromadoptingvehicleemissionstandardsestablishedbyCARB.TheDepartmentaddsthatitisimportanttonotethatthisfinal-formrulemakingdoesnotadopttheProgrambutmakeschangestothealreadyexistingregulationstopostponetheProgramcompliancedatefromMY2006toMY2008,specifytheearlycreditearningperiodforautomobilemanufacturersandupdatedefinitionsandcross-references.Inthepreambletothe1998rulemakingthatincorporatedtheCaliforniastandardsbyreference,theBoardstateditsintentiontoreassesstheairqualityneedsandemissionreductionpotentialofbothprograms.Achievingandmaintainingthehealth-basedNAAQSforground-levelozoneremainchallengesforthisCommonwealth,particularlyintheSoutheast.TheEPAconcludedthatthereisanassociationbetweenambientozoneconcentrationsandincreasedhospitaladmissionsforrespiratoryailments,suchasasthma.Children,theelderlyandthosewithrespiratoryproblemsaremostatrisk,buthealthyindividualsmayexperienceincreasedrespiratoryailmentsandothersymptomswhentheyareexposedtoambientozonewhileengagedinactivitiesthatinvolvephysicalexertion.Ozoneisnotdirectlyemitted,butiscreatedintheatmosphereasaresultofthechemicalreactionofNOandVOCs,inthepresenceoflightandheat.Theformationofozoneisgreaterinthesummermonthsbecauseofthehighertemperatures.Ground-levelozoneandhttp://www.pabulletin.comlsecure/datalvol36/36-49/2406.html5/16/2007PABulletin,Doc.No.06-2406Page17of23itsprecursors,VOCandNOR,adverselyaffectnotonlypublichealthbutalsotheenvironment,suchasagriculturalcropsandforestvegetation.Passengercarsandlight-dutytrucksaresignificantsourcesofVOCsandNON.About1/3ofthisCommonwealth’sozoneformingpollutioncomesfrommotorvehicles.Furtherreducingozoneprecursorsandotherairpollutantsfrommotorvehicleswillthushelpprotectpublichealthandtheenvironment.Duringthedevelopmentofthefmal-formrulemakingtorevisethe1998regulation,theDepartmentengagedtheservicesofaNationaltransportationconsultant,MichaelBakerCorporation(Baker),toestimatetheemission-reducingbenefitsofretainingtheCaliforniastandardsinthisCommonwealthcomparedtoparticipatingintheFederalTierIIprogram.Thisstudy(“PennsylvaniaLEVIIAirQualityImpacts,”November2004)showedthatby2025,whenfullfleetturnoverisexpected,theCaliforniaLEVIIprogramwillprovideanadditionalreductionof2,850to6,170tonsperyearofVOCs,3,540tonsperyearreductionofNOand5%to11%morereductionofsixtoxicairpollutants,includinga7%to15%additionalbenefitforbenzene,aknowncarcinogen,whencomparedtotheFederalTierIIprogram.(ArangeisshownbecausetheCommonwealthpreparedanalysesusingassumptionsfromtheEPAaswellasassumptionsfromtheNortheastStatesCoordinatedAirUseManagement(NESCAUM)study.ThelowernumberusesthemoreconservativeEPAassumptions.)TheBakeranalysisusedPennsylvania-specificvehicle,travel,fuelandotherinformation.CALEVIIandEPA’sTierIIusesimilarapproachesinregulatingemissionsaffectingozoneandothercriteriapollutantsfromnewpassengercarsandlight-dutytrucks,whichincludevehicle-specificstandardsandmanufacturerfleetaverages.Inbothprograms,manufacturersmaychoosethetechnologiestheyusetomeetthevehicle-specificemissionlimitsandmaychoosethemixofvehiclestheyofferforsaletomeetthefleetaverages.Amanufacturermaycertifyanyparticulartypeofvehicletoacategorythatlimitsemissionsofanumberofpollutants.ForCALEV,themajorcategoriesincludeLEV,UltraLowEmissionVehicleandSuperUltraLowEmissionVehicle.FortheFederalprogram,thereareeight“bins.”Bin5isconsideredequivalenttotheleaststringentCaliforniastandard.Thesevehicle-specificemissionlimitationsaffectbothtailpipeandevaporativeemissions.Overall,theCaliforniaprogramismorestringent.Inaddition,eachmanufacturermustmeetafleetaverageforemissionsofnonmethaneorganiccompounds(equivalentofVOCs)forCaliforniaandafleetaverageforemissionsofNOfortheFederalprogram.Overall,thesefleetaveragesmaketheCaliforniaprogrammorestringent.CaliforniahasrecentlypromulgatedamendmentstoitsregulationsestablishingitsCaliforniaLEVIIstandardsinTitle13CCR,Division3,Chapter1toincludeGHGrequirements.TheseGHGregulationsarealreadyincorporatedbyreferencebytheDepartment’sregulationsandarepartoftheProgram.Undertheseregulations,CaliforniahasaddedaGHGfleetaveragerequirementtoitsLEVIIprogramforvehiclesofferedforsaleinCalifornia.Thisfinal-formrulemakingdoesnotincludeaPennsylvaniaGHGfleetaveragerequirement.AvehicleofferedforsaleinthisCommonwealthmustsimplybeCARB-certified.ForavehicletobeCARB-certified,thevehiclemanufacturermustmeetCalifornia’sGHGfleetaveragerequirementsbasedonsalesofvehiclesinCalifornia.TheDepartmentdoesnotbelievethatitneedstoestablishaGHGfleetaveragerequirementforvehiclesofferedforsaleinthisCommonwealthtorealizetheGHGemissionreductionsinthisCommonwealthanticipatedundertheCaliforniaLEVIIprogram.Overall,thevehiclehttp://www.pabulletin.comlsecure/datalvol36/36-49/2406.html5/16/2007PABulletin,Doe.No.O6-24O6---C.Page18of23fleetmixinthisCommonwealthissimilartoCalifornia’s,andtheCommonwealthanticipatesitwillrealizesimilarGHGemissionsreductionsinthisCommonwealthbecausethefleetvehiclemixinthisCommonwealthissimilartoCalifornia’s.Toassesscostsandcostdifferentials,theDepartmentevaluatedtheCARBinitialandfinalStatementsofReasonsfortheadoptionofCALEVIIandtheGHGprovisionsandthecostscontainedintheEPA’simpactanalysisforpromulgationofTierII.Beforeadoption,CAREpredictedthatimplementingLEVIIcouldincreaseretailvehiclepricesfrom$68to$276dependingontheweightofthevehicle.Similarly,theEPApredictedthatimplementingTierIIcouldincreasevehicleretailpricesfrom$78to$245dependingontheweightofthevehicle.Today,withbothprogramshavingbeeninplacesinceMY2004,thereappearstobelittletonodifferenceinvehicleretailpricebetweenCARE-certifiedandFederal-certifiedvehicles.InSeptember2004,CARBestimatedthatbyMY2016theoperationalefficiencysavingsofvehiclesmeetingGHGrequirementswouldprovidevehicleownersanoverallcostsavingsof$3.50to$7permonth,assuming$1.74pergallonofgasoline.Thesesavingsareprobablyunderstated,sincethepriceofgasolineislikelytoremainhigherthanthatusedinCARB’sanalysis.CAREestimatedtheGHG-relatedinitialinvestmentcosts,possiblyreflectedinstickerprices,wouldstartunder$50pervehicleforthefirstyearoftherequirement,MY2009,andbeapproximately$350in2012and$1,000inMY2016.VehiclemanufacturersdisagreewithCARB’sGHGestimate,citinginitialcostsofabout$3,000pervehicle.VehiclemanufacturersalsobelievethatthecostsavingswillnotbeasgreatasCAREpredicts.Insummary,thereisacontinuingneedforadditionalreductionsinozoneprecursorsbecauseofthechallengeinachievingandmaintainingtheground-levelozonestandard;thereareadditionalbenefitstohealthandtheenvironmentfromobtainingreductionsofVOC,NOandGHGemissionsthatFederalnewmotorvehicleprogramsdonotprovide.CAREstandardscostconsumerslittleornothingintheshorttermandoverallsaveconsumersmoneyinthelongterm.SummaryofCommentsSupportingImplementationoftheProgramOver4,000commentatorsvoicedtheirsupportfortheProgramandforthefinal-formrulemaking.Theirreasonsweremany,includinghealthandenvironmentalbenefits,economicissuesandtechnologyadvances.SomecommentatorsurgedtheDepartmenttoimplementtheProgramasquicklyaspossible.OthercommentatorssawvalueinthepostponementoftheProgram.TheDepartmentappreciatesthesupportofthesecommentators.SummaryofCommentsOpposingtheProgramCommentswerereceivedfromroughlytencommentatorsopposingtheLEVprogramitself,whichisalreadyadoptedinthecurrentregulations,asopposedtothisfinal-formrulemaking,whichpostponestheProgramcompliancedatefromMY2006toMY2008,specifiestheearlycreditearningperiodforautomobilemanufacturersandupdatesdefinitionsandcross-references.AlthoughcommentsreceivedontheLEVprogramarenotpertinenttothisfinal-formrulemaking,theDepartmentnonethelessaddressesthemhereandinmoredetailintheCommentandResponsedocument.http://www.pabulletin.comlsecure/datalvol36/36-49/2406.html5/16/2007PABulletin,Doe.No.06-2406Page19of23FederalStandardsSeveralindustrycommentatorsandSenatorsMadiganandWhiteopposecontinuedPennsylvaniaadoptionoftheCaliforniastandardsandcommentedthattheDepartmentshouldfollowtheFederalstandards.SomeofthesecommentatorsbelievedtheDepartmenthadalreadybeenfollowingtheFederalTierIIprogram.Thetwosenatorscommentedthattheywouldcontinuetoadvocateforlegislationwhichcallsforacomprehensivestrategyofassessing,improvingandmaintainingthisCommonwealth’sairqualityinamannercompliantwiththeCAA.TheDepartmentrespondsthat,althoughmanufacturersneededtosellcarscomplyingwithTierIIratherthanNLEVforMYs2004and2006duetothelanguageadoptedasaconditionofparticipationinNLEV,theCaliforniastandardsarecurrentlyincorporatedbyreferenceintheCommonwealth’sregulations.InaDecember2,2005,lettertoRepresentativeRichardGeist,EPARegion3AdministratorDonaldWelshstatedthatitistheEPA’sopinionthattheCALEVstandardsare“thelegallyeffectiveprogramforPennsylvania”andunderscoredthattheCALEVstandardsarea“federallyenforceablepartoftheSIP.”Thefinal-formrulemakingamendstheexistingregulationsaspreviouslydescribed.Severalindustrycommentators,thePennsylvaniaAAAFederationandthetwosenatorscommentedthattheCaliforniaLEVstandardswillproducenoairqualitybenefitrelativetotheTierIIprogram.TheywrotethattheEPAhasstated:“WeestimatedthatLEVIIwillprovideabout1percentadditionalreductioninmobilesourceVOC,andabout2percentreductioninairtoxics,overTierIIin2020withtheprogramstartinginthe2004modelyearandlowerwithalaterprogramstartdate.”TheywrotethattheEPAhascautionedstatesagainsttakingtoomuchcreditfortheCALEVprogram.TheDepartmentdisagreeswiththecharacterizationofthebenefitsofimplementingtheProgram.TheletterfromtheEPAtoNESCAUMregardingNESCAUM’sanalysisofbenefitswasnotastatementpertainingtothebenefitsestimatedbytheDepartment.Infact,theEPAstatedinaDecember2005responsetoRepresentativeRichardGeistregardingtheissueofEPAquantificationoftheemissionsbenefitsfromtheimplementationoftheProgramthat“atpresent,EPAhasnotperformedsuchananalysis,althoughPADEPhasdoneso.Section177ofthe[CleanAirjActdoesnotrequireastatetodosuchanalysispriortoadoptionofCALEVstandards.However,suchbenefitswouldneedtobequantifiedinordertorelyonassociatedemissionreductionsinaSIP[StateImplementationPlan]submittedforEPAapproval.”TheDepartmentwillsubmititsanalysistotheEPAaspartofarevisiontoitsSIP.Withregardtothe2004letterfromtheEPAtoNESCAUM,theEPAalsostatedinthesameDecember2005lettertoRepresentativeGeist,“EPAcommentedinaMarch26,2004lettertoNESCAUMonaWhitePaperNESCAUMpreparedonmethodsquantifyingdifferencesbetweenfederalTierIIandCALEVIIstandards.EPAwasconcernedthatstatesusethepropermethodsinmodelingbothprogramstoensurethatincrementalbenefitfromLEVIIisproperlyquantified,althoughEPAalsoprovidedatypicalestimateforincrementalemissionsbenefitstobeexpectedbetweenthetwoprograms.PennsylvaniashouldfollowEPA’sguidelineswhencalculatingincrementalemissionsbenefitsavailabletoPennsylvaniaforCALEVIIversusTierII.”TheDepartmentusedEPAguidelinesinestimatingtheemissionsbenefitsofimplementingtheamendedProgramregulationsinadditionaltousingtheNESCAUMmethodtoestablishrangeofpotentialbenefits.TheDepartmentintendstousetheEPAmethodologyaspartofitsSIPsubmittalfortherevisedProgram.SenatorsMadiganandWhitecommentedthataJanuary31,2006,letterfromtheDepartmentdismissedasirrelevantargumentsthattheEPAhasstatedthereisonlya1%tohttp://www.pabulletin.com!secure/datalvol36/36-49/2406.html5/16/2007PABulletin,Doe.No.O6-24O6.

cPage20of232%emissionreductiondifferencebetweenFederalvehicleemissionstandardsandtheCaliforniaprogram.ThesenatorsstatedthattheDepartmentwrotethattheEPAwascomparingCALEVIItotheNLEVprogram,butthattheEPA’sMarch26,2004,letterstatedthatthecomparisonwastoTierII.TheDepartmentrespondsthattheEPA’s2004lettertoNESCAUMstatedthatNESCAUM’sestimatedbenefitsofLEVII“areexpressedintermsofrelativebenefitoverTierII;whencharacterizedintermsoftheabsolutebenefitsrelativetoa(non-TierII)baseline,thedifferencesbetweentheprogramsaremorerealisticallycharacterized.”TheEPAthengoesontosaythatthe1%to2%additionalreductionbenefitestimateisinadditiontoTierII.TheEPAdidnotshowwhatdatatheyusedtoestimatethesepercentagereductionsbutbytheirstatementaboutNESCAUM’sanalysisandthatarealisticcharacterizationwouldbeanabsolutecomparisontoanon-TierIIbaseline,theDepartmentconcludedtheEPAmadethatcomparisonforestimatingtheirreductions,thatis,byusingtheNLEVprogramasabaseline.TheDepartmentdisagreesthattheNLEVprogramshouldbeusedasabaselinecomparisonforthepurposeofestimatingthebenefitsofimplementingtheProgram.NLEVisnolongeranoptionforautomakers,asautomakerswererequiredtocomplywiththemorestringentTierIIstandardsbeginningwithMY2004.TheDepartment’scomparisonsweretotheonlylegalalternativetoCALEVIIstandard--theFederalTierIIprogram.ThetwosenatorscommentedthattheDepartmentstatedthatithasreliedupontheadditionalbenefitsofadoptingCALEVIIasameansofachievingattainment.TheysaidthattheDepartmentfailedtoacknowledgethat31countiesareexpectedtocomeintocompliancewiththe8-hourstandardby2009,andthatnoneoftheremainingcounties’attainmentstrategycallsforutilizingprojectedbenefitsfromCALEVII.ThesenatorsstatedthatnodocumentsprovidedtotheGeneralAssemblyorthepublicbytheDepartmentactuallyshowwheretheDepartmentcalculatedandanticipatedbenefits.Theystatedthat,tothecontrary,severaldocuments,includingtheDepartment’sAugust2003recommendationstotheEPAfor8-hourozoneattaiimentJnonattainmentareas(whichmakesnomentionofachievingfuturecreditunderCALEVII),reflecttheDepartment’sconfidencethat,realizingthebenefitsofcleanercarsunderTierII,theCommonwealthcanmeetandmaintainFederalairqualitystandards.TheDepartmentrespondsthatmodelingpreparedbytheEPAfortheCleanAirInterstateRuleindicatedthatmanyofthecurrentnonattainmentcountiesinthisCommonwealthwereexpectedtocomeintocompliancewiththe8-hourozonestandard.However,basedonstudiessubsequentto2003,theDepartmentdoesnotagreewithalloftheassumptionsorconclusionsinthismodeling.TheCommonwealthis,therefore,workingwithotherstatesintheNortheast,Mid-AtlanticandMidwesttoconsideradditionalmeasurestomeetthe8-hourstandard.PublicmeetingswereheldinMay2006todiscusspossiblemeasuresinadditiontomeasuresliketheCaliforniaLEVprogramthathavealreadybeenadoptedbyotherstates.TheDepartmentagreesthatSIPrevisionsinnonattainmentareassubmittedtotheEPAtodatehavenotassumedimplementationoftheCaliforniaprogram;theseSIPrevisionsareprimarilyforattainmentofthe1-hourozonestandard.Theywerepreparedbeforethedesignationofareasforthe8-hourstandardbecamefinalandtheassessmentofbothbenefitsofandneedforretainingtheCaliforniaprogramwasperformed.Afteranareaoriginallydesignatedasnonattainmentattainsthestandardbasedonactualmonitoringofairquality,theCommonwealthmustdemonstratethattheareawillmaintainthestandardforatleasttenyearsbysubmittingamaintenanceplanasanSIPrevision.Eightyearsafterthat,theCommonwealthwillneedtosubmitasecond10-yearmaintenanceplanasanSIPrevision.Inaddition,ascommentsfromtheAmericanLungAssociationemphasized,iftheEPArevisestheozonestandardagainastheresultoftherequired5-yearreviewofhealthevidence,stateswillberequiredtoprepareSIPstoattainthatstandard.TheEPAisintheprocessofthatreviewatpresent,withsomehttp://www.pabulletin.comlsecure/datalvol36/36-49/2406.html5/16/2007

# PABulletin,

Doe.

No. 06-2406

Page

21

of

23 indications

that

a further tightening

of the standard

is possible. Cross-Border

Purchases The Pennsylvania

Automotive

Association

commented

that dealers

could

have problems supplying

specific

vehicles

to meet customer

needs.

They

stated

that since

no dealer

can keep

all vehicles

in stock, dealers

work together

to trade inventory

to satisfy particular needs,

even across

state

lines.

The association

expressed

concern

that bordering

states

are

in different

phases

of dealing

with

the California

car issue

and

that dealers

in non-California states would

carry non-California

cars primarily

or exclusively.

The Department

responds that

one reason

the Commonwealth

proposed

to postpone

its enforcement

of the California program

until

MY

2008

was

to better

ensure vehicle availability.

The EPA’s

cross border policy

allows

dealers

in adjacent

states

to sell California

vehicles.

If there

is enough

demand for these interdealer

trades,

the postponement

will

give

the market

time

to adjust

to the requirement. The Pennsylvania

Automotive

Association

commented

that

few

if any consumers

who

are not required

to purchase

a California

vehicle

will choose

to pay

the price premium

for

a vehicle

that meets

the California

standards

and that,

to the extent

that residents

of other states

near

this Commonwealth

are

not subject

to the California

rule, dealers

in this Commonwealth

can expect

to lose

all

or nearly

all so-called “cross-border

sales”

once

the California

rule comes

into effect.

They

stated

that those out-of-State

consumers

who

want vehicles

with higher

fuel economy

will

be able

to purchase

them

from dealers

located outside

this Commonwealth

who currently,

and

in the future,

will

have

an ample

supply

of higher-mileage

vehicles

for sale.

The Department

disagrees.

This final-form rulemaking does

not adopt

the California

LEV program

or require compliance

with

the California

GHG fleet average

based

on sales

in this Commonwealth,

but makes changes

to the existing regulations

to postpone

the Program compliance

date

from

MY 2006

to MY 2008, specify the early credit earning

period

for automobile manufacturers

and update definitions

and cross-references.

There

is presently

no price differential

in states surrounding

this Commonwealth

for California

and non-California

vehicles.

Once

the GHG provisions become effective,

CARB predicted

that

the cost differentials

would

start

at less

than

$100

in MY 2009

and

rise

to about $1,000

in 2016

when

the most stringent

GHG

limit

is imposed. The Department

disagrees

with

the implication

that dealers

in this Commonwealth

will necessarily

lose

sales

from residents

in states

that have

not adopted

the California regulation.

The Program

does

not require automakers

to meet

the GHG

fleet average

based on sales

in this Commonwealth.

Since

there

is no per-vehicle

GHG requirement,

it

is expected

that

any differential

costs

for

a specific

make

or model

will

be

a minor concern

in the choice

of noncitizens

of this Commonwealth

to purchase

from

a dealership

in this Commonwealth. Vehicles

Types Several commentators,

including

IRRC, expressed

concern

with

the impact

of the proposed rulemaking

on vehicles

that operate

on different

types

of fuels.

They

stated

that light-duty

vehicles

that operate

on diesel

are very popular.

IRRC

asked whether consumers will

still

be able

to purchase

and operate

these vehicles

in this Commonwealth

under CARE regulations.

The Department

responds

that diesel vehicles presently

comprise

a very

small percentage

(0.09%)

of passenger

and light-duty

vehicles

in this Commonwealth.

Based

on the Department’s

analysis,

it appears

that automakers

have

not

as yet been enthusiastic about offering

diesel light-duty

vehicles

in the United

States

and citizens

in this http ://www.pabulletin.comlsecure/datalvol3

6/3 6-49/2406.html

5/16/2007PABulletin,Doc.No.06-2406ç-

cPage22of23Commonwealthhavenotbeenchoosingtobuyverymanyofthesmallnumberofmodelsavailable.GasolineversionsofthesevehiclesarecertifiedandavailableinCaliforniaLEVstates.Theheavierdieselpick-uptruckssuchasthosetypicallyusedbyfarmersarenotregulatedbytheProgrambecauseoftheirweight--theonlylight-dutytruckssubjecttotheprogramarethose8,500poundsgrossvehicleweightorless.Inlightofrapidadvancementindevelopingexhaustclean-uptechnologiesfordieselcarsandlight-dutytrucks,automakersareexpectedtobebetterabletocertifydieselvehiclestotheCAREstandardiftheysodesire.Withthecomingofultra-lowsulfurdiesel(ULSD)fuelacrosstheUnitedStatesbeginninginfallof2006,theDepartmentbelievesautomakerswillbeabletocertifydieselvehiclestotheCAREstandardandmakethemavailableinthisCommonwealth.ManylargeautomakershavealreadypubliclyindicatedtheywillbeabletocertifytheirlightdutydieselvehiclestotheCaliforniastandardsonceULSDiswidespread.TheindustryhascompliedwithCARBstandardseverytimeCAREhasrevisedthemsince1961whenCaliforniaestablishedthefirstautoemissionsstandards2yearsbeforetheFederalgovernment.TheDepartmentbelievesthattheautomakerswillseizetheopportunitytodevelopcompliantvehiclesiftheyareindemandbyconsumersinthisCommonwealthandtheotherstatesimplementingtheLEVprogram.Atleastoneautomaker,DaimlerChrysler,hasalreadyannouncedtheavailabilityofaMY2007light-dutydieselvehiclecapableofcomplyingwithLEVstandards.(Thecompany’sJanuary8,2006,pressrelease“NAIAS2006Detroit:DaimlerCbryslertoFeatureTechnologyfortheCleanestDieselintheWorld”isavailableatwww.daimlerchrysler.com.)SeveralindustrycommentatorsandthePennsylvaniaAAAFederationcalledforfollowingtheFederalTierIIprogrambecausetheyclaimitcanbetteraccommodatedieselsbyaddingflexibilitywithoutsacrificingemissionsbenefits.TheDepartmentrespondsthatCARE,theEPAandthemanufacturerssharesimilargoals--toensurethatcleanlight-dutydieselscanbepartofthevehiclemixintheUnitedStates.PostponementoftheimplementationoftheCALEVprograminthisCommonwealthfromMY2006untilMY2008asprovidedforinthisfinal-formrulemakingprovidestimeformanufacturerstomeetthestandardsforvehiclesanticipatedtobesoldinCALEVstates.TheEPA’srecentTierIIrulechanges,publishedat71FR16053(March30,2006)directfinalruleeffectiveJune28,2006,affectMYs2007--2009only.Afterthattime,theEPAexpectsthatmanufacturerswillbeabletomeetthe“remainingnarrowchallenges”facingdieseltechnology(71FRat16056).IRRCcommentedthatindustry,FederalandStateleadershaverecentlyexpressedsupportforflexiblefueledvehicles(FFV)thatoperateonfuelswithagreaterpercentageofethanol.IRRCaskedwhattheimpactofthisfinal-formrulemakingontheuseofethanolwillbe.TheDepartmentrespondsthatethanolcaneitherbeaddedtogasolineinamountsupto10%,whichcanbeaccommodatedinconventionalvehicles,orinablendcalledE85,whichis85%--ethanol.Aspeciallydesignedvehicle,knownasanFFV,whichcanrunonconventionalgasolineorE85,isneededtoaccommodateE85fuel.TherewillbenoeffectontheuseofethanolinconventionalvehiclesfromtheProgram.ForE85andnewFFVs,thepostponementincompliancedateinthisfinal-formrulemakingwillgivetheindustrytimetorespondtomarketsituations.ThedecisionbytwomanufacturersnottocertifyFFVsinCaliforniaforthecomingmodelyear(MY2007)wasabusinessdecision,reportedlybasedonthelackofE85refuelingstations.Atleastoneothermanufacturer,GeneralMotors,iscontinuingtocertifyFFVsinCaliforniaforMY2007.TherearefewE85stationsoutsidetheMidwest.Californiahasonlyoneand,therefore,thereisasmallmarket.AsE85stationsbecomemorecommon,itisanticipatedthatthedemandforthevehicleswillincreaseandthesemanufacturerswillagaincertifyFFVsforuseinCALEVprograms.http://www.pabulletin.comlsecure/data/vol36/36-49/2406.html5/16/2007PABulletin,Doe.No.06-2406Page23of23Also,E85canbeusedinalloftheFFVsalreadyinuseinthisCommonwealth.TheCommonwealthhasaninterestinencouragingrenewablefuels,suchasethanol.ThefirstpublicE85stationinthisCommonwealthopenedinspring2006.LContinuedonnextWebPage]Nopartoftheinformationonthissitemaybereproducedforprofitorsoldforprofit.ThismaterialhasbeendrawndirectlyfromtheofficialPennsylvaniaBulletinfulltextdatabase.DuetothelimitationsofHTMLordifferencesindisplaycapabilitiesofdifferentbrowsers,thisversionmaydifferslightlyfromtheofficialprintedversion._________4I_webmaster(äPaBu11etin.coinhttp://www.pabulletin.comlsecure/datalvol36/36-49/2406.html5/16/2007CCPABulletin,Doc.No.06-2406a(Page1of22.ThPcnRq4vanLR.______—.—.liiii[36Pa.B.7424][Saturday,December9,2006][ContinuedfrompreviousWebPage]Ca4fbrniaLEVAdoptionSenatorsMadiganandWhiteassertedthattheDepartmentadoptedamorestringent(comparedtoTierI)Federaloptionavailableatthetimeofthe1998rulemaking,calledNLEV.TheDepartmentrespondsthatChapter126,SubchapterDadoptedin1998,previouslytitledNewMotorVehicleEmissionsControlProgram,containedbothNLEVandProgramprovisionstoenabletheCommonwealthtoparticipateinNLEVaswellastheProgram,whichincorporatestheCaliforniaLEVprogram.SenatorsMadiganandWhiteandseveralothercommentatorscommentedthatthecurrentDepartmentadministrationreversedcoursefromits1998statementsandnowclaimsthattheCaliforniavehicleemissionstandardiseffectiveinthisCommonwealthforMY2006.TheystatedthatiftheDepartment’scurrentinterpretationistobebelieved,thentheDepartmenthasofferednoreasontosubstantiatewhyitisproposingtopostponeimplementingtheCaliforniastandardwhen,peritsownargument,theautomobileindustryandconsumershavehadadvancenoticeofitseffectivedatefornearly8years.TheystatedtheirbeliefthattheCALEVprogramwasintendedsolelyasa“backstop”toNLEV/TierII.TheycitedvariousstatementsattributedtotheDepartmenttosupporttheirbelief.TheyalsostatedthattheirbeliefisthattheDepartmenthasfailedtorevisitthecurrentregulationinatimelyfashiontoincorporatetheFederalTierIIstandardsandthatthisrulemakingisactuallyaconsciousdecisiontocodifytheCaliforniastandardintheCommonwealth’sregulations.TheystatedtheDepartmentintentionallyomittedinaJanuary31,2006,lettertotheGeneralAssemblythecontextofthe1998rulemakingaswellastheDepartment’sownstatedintentiontorevisetheregulationtoincorporateTierIIwhenitwasfinalized.SeveralindustrycommentatorscommentedthattheProgramincludedadoptionoftheLEVstandardsasatemporarymeasureor“backstop”incasetheEPA’sNLEVprogramwasnotimplementedorifFederalstandardscleanerthanNLEVwerenotadopted.TheDepartmentrespondsthattheCaliforniastandardswereadoptedinthisCommonwealthtorequirecomplianceiftheautomanufacturersoptednottoparticipateinthevoluntaryNLEVprogramoraftertheendofthecommitmenttoNLEVafterMY2005.Thiswasstatedclearlyinthepreamblestothe1998proposedandfinal-formrulemakings:“ThisprogramwillonlybeimplementedifanautomanufactureroptsoutoftheNLEVprogramorattheconclusionoftheNLEVprogram.”(Emphasisadded.)Seethefinal-formrulemakingat28Pa.B.5873,5874.Seealsotheproposedrulemakingat27Pa.B.6303,6305(November29,1997).ThepreamblespecifiedthatNLEVwasonlyatemporarymeasure:“TheCommonwealth’sNLEVprogramparticipationendswithmodelyear2006.”See28Pa.B.5783,5875.The1998regulationitselfwasandisclear.ItexpresslyadoptsandincorporatesbyreferencecertainprovisionsoftheCaliforniaLEVprogram,Title13,CCRin§126.411,requiresCARBcertificationforvehiclessold,imported,delivered,purchased,leased,rented,acquired,receivedorregisteredinthisCommonwealthin§126.412(a)andrequirescompliancewiththeCaliforniaNMOGfleetaverageinthisCommonwealthin§126.412http://www.pabulletin.comlsecure/datalvol36/36-49/2406a.html6/4/2007PA Bulletin,

Doc.

No. 06-2406a

Page

2 of

22 (b).

The

1998 regulation

expressly

adopts

NLEV

as only

a temporary

measure

and

a compliance

alternative

to the California

program:

§ 126.402(b))

stated

“The Commonwealth’s

participation

in the NLEV program

extends

until model

year 2006...“ and

§ 126.401(b)

stated

“This subchapter

allows

motor vehicle manufacturers

to comply with

the voluntary

NLEV program... as

a compliance

alternative

to the Pennsylvania Clean Vehicles Program....“ Hence,

the Department

was clear

that

the California

program was offered

as more

than

just

a backstop

in the event

a manufacturer

did

not comply

with NLEV

or the Federal standards

were

not finalized.

The

1998 regulations

provided

in § 126.402

(c)that

“[fjor

the duration

of the Commonwealth’s

participation

in the NLEV program, manufacturers

may comply

with

the NLEV standards

or equally stringent mandatory

Federal standards

in lieu

of compliance

with

the Pennsylvania

Clean Vehicles Programestablished

in

§ 126.411--126.441....“

In 2004,

the EPA established

more stringent

Federal standards

called

Tier

II. Hence, manufacturers

were required

to comply with

Tier

II,

as part

of the NLEV program,

for MYs

2004

and 2005. Beginning

with

MY 2006,

when

the Commonwealth’s

participation

in the NLEV program

ended,

the California program

took effect. “Except

as provided

in subsections

(a) and

(c) [describing

NLEV participation],

the Pennsylvania

Clean Vehicles

Program

applies

to

all new passenger

cars, and light-duty

trucks

(if designed

to operate

on gasoline)

sold, leased,

offered

for sale

or lease, imported,

delivered, purchased,

rented, acquired,

received

or registered

in this Commonwealth

starting

with

the model

year beginning

after December

5, 2000,

and each model

year thereafter.”

(Emphasis

added.)

See

§ 126.402(d).

Hence,

the current rulemaking is not

an adoption

or codification

of the California

program.

The California

program

was adopted,

or codified,

in the Commonwealth

in 1998.

The Department

proposed postponing implementation

of the Program

in this final-form rulemaking

to minimize

any potential vehicle availability

issues

and

to put

in place

a specific transition mechanism

for compliance. Incorporation

by Reference The Alliance submitted

several comments

regarding

the existing regulations’ incorporation

by reference

of the California

program.

It claimed

that

the Board

and Department

have

been ambiguous

about whether

they believe

that

the

CA LEV

II program is already

the

law

of the Commonwealth

and

that there

needs

to

be

a legal

basis

for

a conclusion

that

an incorporation

by reference

has already occurred.

The Alliance

claimed

it is highly unusual

for

the Board

to claim

it has

the authority

to adopt regulations

that automatically

incorporate

any amendments

that

are made

to the California

program.

The Department

disagrees

that

the Board

and Department

have

been ambiguous.

The purpose

of this final-form rulemaking

is not

to adopt

CA LEV

II because

by virtue

of the 1998 rulemaking,

CA LEV

II

is already

the legally effective

program

in this Commonwealth. Situations

in which cross-referenced

statutory

or regulatory

provisions

are later revised

or replaced

are addressed

in

1 Pa.C.S.

Part

V (relating

to Statutory Construction

Act

of 1972). Pennsylvania

courts

have

held

that

the

act applies

to regulations

as well

as

to statutes.

(See, for example,

Highway

New,

Inc.

v. Pennsylvania

Department

of Transportation,

789 A.2d 802,

808

(Pa. Cmwlth.

2002).)

Section

1937(a)

of the Statutory Construction

Act

of 1972 (relating

to references

to statutes

and regulations)

states

that

“A reference

in

a statute

to

a statute

or

to

a regulation

issued

by

a public

body

or public

officer includes

the statute

or regulation

with

all amendments

and supplements

thereto

and

any

new statute

or regulation substituted

for such statute

or regulation,

as

in force

at the time

of application

of the provision

of the statute

in which

such reference

is made,

unless

the specific language

or the context

of the reference

in the provision

clearly includes

only

the statute

or regulation

as

in force

on

the effective

date

of the statute

in which

such reference

is made.” (Emphasis http://www.pabulletin.comlsecure/data!vol3

6/3 6-49/2406a.html

6/4/2

007PABulletin,Doe.No.06-2406aC(‘Page3of22added.)InaDecember2,2005,lettertoRepresentativeRichardGeist,EPARegion3AdministratorDonaldWelshstatedthatitistheEPA’sopinionthattheCALEVstandardsare‘ThelegallyeffectiveprogramforPennsylvania”andunderscoredthattheCALEVstandardsarea“federallyenforceablepartoftheSIP.”Hence,California’spost-1998amendmentsandsupplementsto,andanynewstatuteandregulationsubstitutedfor,theportionsoftheCaliforniaLEVprogramthatwereadoptedintheCommonwealth’s1998rulemakingareautomaticallyincludedintheCommonwealth’sregulations.TheAlliancecommentedthatauthoritytoadoptregulationsthatautomaticallyincorporateamendmentsmadetotheCaliforniaprogramdelegatesstatutoryimplementationauthorityinsection2(a)oftheRegulatoryReviewAct(71P.S.§745.2(a))toanotherstate’sregulatoryauthorityinviolationofPa.Const.Art.II,§1.TheDepartmentrespondsthatthecurrentregulationsandthefinal-formrulemakingareauthorizedundertheact.TheCommonwealth,alongwiththeotherstatesthathaveadoptedtheCaliforniaLEVprogram,hasthesameabilitytocommentonchangestotheCaliforniaprogramasithasincommentingonchangestotheFederalnewmotorvehiclecontrolprogram.ElectedrepresentativesarepartoftherulemakingprocessintheCommonwealthestablishedbytheRegulatoryReviewAct(71P.S.§745.1--745.15).Additionally,thefinal-formrulemakingrequirestheDepartmenttomonitorandadvisetheBoardofproposedorfinalCALEVrulemakingunderconsiderationbyCARB,prepareacost/benefitanalysistobesubmittedtotheBoardandChairpersonsoftheHouseandSenateEnvironmentalResourcesandEnergyCommittees(Committees)foreachproposedorfinalCARBrulemalcing,evaluateandsubmittotheBoardandtheChairpersonsoftheCommitteestheestimatedincrementalcosttomanufacturevehiclesthatcomplywiththeCALEVprogramcomparedtotheFederalprogramandsubmitcommentsonproposedorfmalCARBrulemakingsonbehalfoftheresidentsofthisCommonwealth.Section1937(a)oftheStatutoryConstructionActof1972explicitlyprovidesthat“Areferenceinastatute[orregulation]toastatuteortoaregulationissuedbyapublicbodyorpublicofficerincludesthestatuteorregulationwithallamendmentsandsupplementstheretoandanynewstatuteorregulationsubstitutedforsuchstatuteorregulation,asinforceatthetimeofapplicationoftheprovisionofthestatute[orregulation]inwhichsuchreferenceismade...“Thus,theautomaticinclusionintheCommonwealth’sregulationsofamendmentsandsupplementsto,andofanynewstatuteorregulationsubstitutedforaportionof;theCaliforniaprogramarestatutorilysanctioned.ThePennsylvaniaAAAFederationcommentedthatthenature,severityandgeographyofCalifornia’sairpollutionproblemdriveCalifornia’spollutionreductionstrategies.ThecommentatorstatedthatCaliforniaregionsarein“extreme”nonattainmentwhileregionsinthisCommonwealtharedefinedas“moderate”or“marginal”andthatCalifornia’spollutionreductionstrategiesmaynotbeappropriateforthisCommonwealth.TheDepartmentagreesthatCalifornia’sozoneairpollutionproblemisworsethanthisCommonwealth’s.ThenatureofCalifornia’sproblemhasresultedinadedicationoftechnicalresourcestoairqualityproblemsunequalledintheworld,includingattheEPA.TheDepartmentagreesthatsomeofCalifornia’spollutionreductionstrategiesmaynotbeappropriateforthisCommonwealth.However,asmotorvehicleswillcontinuetocontributeasignificantamountofpollutioninthisCommonwealth,theProgramisacost-effectivestrategytofurtherreducevehicleemissions.SeveralcommentatorscommentedthatadoptingtheCALEVprogramtiestheCommonwealthtoanyandallchangesmadetotheprogrambyCARB,onwhichtheCommonwealth(likeotherstates)hasnorepresentation.TheDepartmentrespondsthatthishttp://www.pabulletin.com!secure/data!vol36/36-49/2406a.html6/4/2007PA Bulletin,

Doc.

No. 06-2406a.

Page

4 of

22 final-fonn rulemaking

is not

an attempt

to adopt

the California

program.

That program

was adopted

in the 1998 rulemaking.

The final-form rulemaking,

like

the proposed rulemaking, requires

the Department

to monitor

and advise

the Board

of proposed

or final

LEV rulemakings

under consideration

by CARB,

prepare

a cost/benefit

analysis

to

be submitted to the Board

and Chairpersons

of the Committees

for each proposed

or final CARB rulemaking,

evaluate

and submit

to the Board

and

the Chairpersons

of the Committees

the estimated incremental

cost

to manufacture

vehicles

that comply

with

the

CA LEV program compared

to the Federal program

and submit comments

on proposed

or final CARB rulemakings

on behalf

of the residents

of this Commonwealth.

The Commonwealth,

along with

the other

states

that have adopted

the California

LEV standards,

has

the same ability

to comment

on changes

to the California

program

as

it has

in commenting

on changes

to the Federal

new motor vehicle

control program.

Elected representatives

are part

of the rulemaking

process

in the Commonwealth

established

by

the Regulatory

Review

Act. The Pennsylvania

AAA Federation

noted

that California

revises

its standards

more frequently

than

the EPA.

The Department

agrees

that California

has revised

its standards more

often

than

the EPA, which

has amended

its light-duty

vehicle standards

only when explicitly

directed

by statute.

The NRC recently

found

that

the process

by which California revises

its standards

is scientifically

and technically

valid

and

is

a benefit

to the country. Compared

to the Federal government,

the ability

of California

to respond

better

to changing conditions,

including technological

advances,

was viewed

by

the NRC

as

an advantage. Most

of the revisions

to the California

program

were revisions

to California’s

ZEV program, which

is excluded

from adoption

in the Program. Stringency Requirement The Alliance commented

that

the proposed rulemaking

failed

to satisfy

the “stringency” limitation

in section

4.2

of the

act

(35

P.

S.

§ 4004.2(b)),

which requires

rules

to

be

no more stringent

than those required

by

the CAA unless authorized

or required

by

the

act

or specifically

required

by

the CAA. Section

4.2(b)

of the

act goes

on

to list certain exceptions to this stringency

limitation.

The commentator

asserts

that none

is applicable

here.

The Department

disagrees.

The existing regulation automatically

incorporates

the current California

program,

which

at this time

is CA LEV

II, not

CA LEV

I. Section

4.2(b)

of the act

is inapposite

because

this final-form rulemaking

is not

a rulemaking

that adopts

the California

standards,

since

they

are already adopted.

This final-form rulemaking

postpones the compliance

date

of the Program

by

2 years.

In this way,

the final-form rulemaking

is not more stringent

than

the existing regulations. Furthermore,

the Department

disagrees

with the commentator’s characterization

of the stringency

provision

of the

act. Section

4.2

of the act authorizes

adoption

of regulations

that

are more stringent

than Federal requirements

if they

are reasonably

necessary

to achieve

or maintain

the ambient

air quality standards. Adoption

of the California

program

under section

177

of the CAA

was reasonably necessary

to achieve

and maintain

the health-based

1-hour

ozone ambient

standard

in this Commonwealth

and

the successor

8-hour

ozone ambient

standard. Stake holder Process Senators

Madigan

and White commented

that

the proposed rulemaking

should

not proceed

at this time.

They

stated

that

a stakeholder

process

(as included

in

SB 1025) should be instituted

to help analyze

state options

for meeting

air quality standards.

They

stated

that SB 1025

also requires

the Department

to report

back

to the General Assembly

by June

30, 2010.

The Department

does

not agree. Neither

a stakeholder

process,

nor

the schedule

in

SB http://www.pabulletin.com/secure/data/vo136/3

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# C

(Page5of221025,accountsforthetimetablesoftheCAAortheCommonwealth’sregulatoryprocess.Specifically,theDepartmentmustsubmitSIPrevisionsformeetingthe8-hourozonestandardbyJune2007andformeetingthefineparticulatestandardbyApril2008.Thestakeholderprocesseswhichtookplacein1996and1997tookmorethanayear;ittookaminimumof1additionalyearsubsequenttothosegroupssubmittingrecommendationstotheDepartmenttofmalizerecommendationsinregulation.Furthermore,thisfinal-formrulemakingisnotdesignedtoadopttheCaliforniaprogram,sinceadoptionoccurredin1998;rather,thisfinal-formrulemakingmakeschangestothealreadyexistingregulationstopostponetheprogramcompliancedatefromMY2006toMY2008,specifytheearlycreditearningperiodforautomobilemanufacturersandupdatedefinitionsandcrossreferences.AbrogationofProgramSenatorsMadiganandWhitecommentedthatanOctober28,2005,letterfromtheDepartmenttomembersoftheHouseofRepresentativesstatedthatpassageofHB2141,abilltoabrogatetheProgram,andrepealoftheCleanVehiclesProgram“putsusinviolationoffederallaw.”Theystatethatsubsequently,theDepartmentchangeditsargument,concedingthattheCommonwealthcaninfactmaintaintheFederalTierIIstandardsbutintheDepartment’sviewwouldneedadditionalreductionsfromstationarysourcestomeetairqualitystandards.TheDepartmentrespondsthatthestatementthatrepealingtheProgramwouldviolateFederallawandthestatementthattheCommonwealthhastheoptiontoreturntotheFederalnewmotorvehiclesprogramarenotcontradictory.TheCommonwealthadoptedtheProgramin1998andsubmittedtheregulationtotheEPAasanSIPrevision.ThatSIPrevisionwaseffectiveFebruary28,2000.ApprovalofanSIPbytheEPAmakestheSIPFederallyenforceable.InaDecember2,2005,lettertoRepresentativeRichardGeist,EPARegion3AdministratorDonaldWelshstatedthatitistheEPA’sopinionthattheCALEVstandardsare“thelegallyeffectiveprogramforPennsylvania”andunderscoredthattheCALEVstandardsarea“federallyenforceablepartoftheSIP.”ThismeansthatFederallawneedstobefollowedifthispartoftheCommonwealth’sSIPistobechanged.TheCommonwealth’sadoptionofCaliforniaemissionstandardscouldnotberevokedwithoutholdingpublichearingsonaproposedSIPrevisiontodoso,respondingtocommentsreceivedandsubmittingtheproposedSIPrevisiontotheEPAforapproval.JustastheDepartmenthadtheauthorityin1998tochoosetoadopttheCaliforniastandards,theDepartmenthastheauthoritytochoosetoparticipateintheFederalprogram,butonlyifthesestepsarefollowed.TheCommonwealthisrequiredbytheCAAtoachieveandmaintaintheNAAQSinallareasofthisCommonwealthdesignatedasnonattainment.Theavailableemissionreductionoptionsare“ashrinkingslate,”ascharacterizedbyMr.WelshintheDecember2005letter.Sincestatesdonothavemanystrategiesregardingmotorvehiclesavailabletothem,mostofthestrategiesareindeedreductionsfromstationarysources.ThetwosenatorscommentedthataNovember1,2005,e-mailfromtheSecretaryofDOTtothemembersoftheGeneralAssemblyinsinuatesthatpassageofHB2141wouldjeopardize$1.6billioninFederaltransportationfunding.Thesenatorsstatedthatthee-mailfailedtoincludeadetaileddiscussionoftheimplicationsofHB2141,thelikelihoodofwhethertheCommonwealthinfactwouldloseFederalfunding,orwhethertheCommonwealthactuallyreliedupontheCaliforniavehicleemissionstandardsaspartofitsSIPcompliancestrategy.ThesenatorsstatedthataDecember2005letterfromtheEPARegion3AdministratorstatedthathebelievedpassageofthebillwouldnotresultinapplicationofFederalsanctionsagainsttheCommonwealthbecauseatpresent,thehttt,://www.nabulletin.conilsecure/dataJvol36/36-49/2406a.html6/4/2007PA Bulletin,

Doc.

No. 06-2406a

C

Page

6 of

22 Commonwealth’s

SIP does

not

rely upon emission reductions.

The Department

responds that

the interpretation

that revocation

of the Program

might trigger

Federal sanctions

was based

upon

the

fact

that

the Program

is

a Federally-enforceable

portion

of the Commonwealth’s

SIP.

The December

letter referenced

by

the commentators

provided

a different interpretation

of the application

of mandatory

sanctions

under

the CAA

and

also indicated

that

it

is unlikely

that

the EPA would impose discretionary

sanctions

because

the Department

had

not relied

upon

the benefits

of the

CA LEV program

in

its SIP revisions

for the 1-hour

ozone standard.

The Department

agrees

that

the emission reduction

benefits

of the California

LEV program

in 1-hour

ozone

SIPs

were

not relied

upon

in SIP submissions to date,

but

the Department

has included

the benefits

in

its development

of SIP revisions

to attain

and maintain

the 8-hour standard.

The Commonwealth

will begin submitting

these SIP revisions

in the

fall

of this year. NMOG

Fleet Average One commentator

stated

that

by adopting

and attempting

to enforce

the California

fleet NMOG

average,

the Commonwealth

will violate

the CAA.

The commentator

asserted

that since

it

is highly unlikely

that

a manufacturer

will

sell exactly

the same products

in exactly the same proportions

in this Commonwealth

as

it will

in California,

and consumers

in this Commonwealth

determine

that

a particular manufacturer’s

sales

mix

in Pennsylvania

results in

a higher

fleet NMOG

average,

the manufacturer

may

be required

to artificially

limit

sales of certain CARB-certified

cars

to comply

with

this Commonwealth’s

fleet average requirement.

The commentator

concluded

that

this would

be

an indirect

limit

on

the

sale

of a motor vehicle certified

to California

standards

and

thus would

violate

section

177

of the CAA.

The Department

disagrees.

This fmal-form rulemaking

does

not establish

the Program

or adopt

the NMOG

fleet average,

but makes changes

to the already

existing regulations

which already incorporate

by reference

the NMOG

fleet average.

This

fmal form rulemaking

postpones

the Program compliance

date

from

MY

2006

to MY 2008, specifies

the early

credit earning

period

for automobile manufacturers

and updates definitions

and cross-references.

Even

ifthis final-form rulemaking

were adopting

the California

NMOG

fleet average,

adopting

the fleet average

would

not violate

section

177

of the CAA. Section

177

of the CAA specifically

authorizes

states

like

the Commonwealth

to “adopt

and enforce standards

relating

to control

of emissions

from

new motor vehicles

or new motor vehicle engines”

if the “standards

are identical

to the California

standards

for which

a waiver

has been granted

for such model

year....“ Courts

accept California’s NMOG

fleet average

as

a “standard

relating

to control

of emissions.”

See,

for example, Motor

Vehicle Manifacturers

Assoc.

v. New

York

State Department

of Environmental Conservation,

17 F.3d

521,

537

(2d

Cir. 1994)

(“It would

be inappropriate

to view

the 1990 [CAA] amendments

in

a manner

that would effectively

prohibit

any

state

from opting

into the California

program

since Congress

so obviously

planned

for

the several

states

to have that option.”);

American Automobile Manufacturers

Assoc.

v. Cahill

152 F.3d

196,

200

(2d Cir. 1998)

(“For example,

the LEV Program

is clearly

a ‘standard’..

.“). The EPA

also accepts California’s

NMOG

fleet average

as

a “standard

relating

to control

of emissions,”

as the EPA

has approved

the

SIP revisions

of

at least

three

states

that have adopted

it, namely Maine, Massachusetts

and New

York.

(70

FR 21959

(April

28, 2005) (Maine);

67 FR 78179 (December

23, 2002) (Massachusetts);

and

70

FR 4773

(Jan.

31, 2005)

(New York).) Moreover,

the Second

Circuit

Court

of Appeals

has stated

that

the purpose

of the sales limitation prohibition

in section

177

of the CAA

is

to prohibit

section

177

of the CAA

opt- in states

from attempting

to regulate

against

the

sale

of

a particular

type,

not number,

of California-certified

cars. Motor

Vehicle Manufacturers

Assoc.,

supra,

17 F.3d

at 536.

The CAA

does

not require automakers

to “sell exactly

the same products

in exactly

the same http ://www.pabulletin. com!secure/datalvol3

6/3 6-49/2406a.html

6/4/2007PABulletin,Doe.No.06-2406aCPage7of22proportions”inastatethatadoptsorimplementsaprogramrequiringCAREstandards.Assaleshingeonmarketingfactors,theultimatedecisiononwhattypeofvehicletointroduceforsaleinanimplementingstatetomeetthefleetaverageisamarketingdecision.TheCommonwealth’sfinal-formrulemakingdoesnotlimitanytypeofhighwayvehiclefrombeingintroducedforsaleinthisCommonwealth.TheProgramonlyrequiresthatanyvehiclesuchasthishaveCARBcertificationandthatintheaggregatetheautomaker’smixofvehiclesintroducedforsaleinthisCommonwealthcomplieswiththeNMOGfleetaveragespecifiedbyCARE.GHGProvisionofCalforniaProgramNumerouscommentsfromindustrycommentatorsandthetwosenatorsaddressedCalifornia’sGHGprovisions.Severalofthesecommentatorsassertedthatthesmog-producingpollutantswouldbeincreasedbecauseoftheGHGregulations,sincepeoplewouldretainoldervehicleswithhigheremissionsastheresultofassertedincreasedpriceofnewvehiclesandpeoplewoulddrivemoremilesiffuelefficiencywereincreased.Tothecontrary,theDepartmentagreeswithCARBthattheGHGprovisionswillprovideanadditionalnetdecreaseoftheemissionsofNOandreactiveorganicgases(ananalogtoVOC).TheDepartment’sanalysisdidnotaccountfortheseadditionalbenefitsasneithertheCommonwealth’sexistingregulationsnorthefmal-formrulemakingrequirestheCaliforniaGHGfleetaveragerequirementtobemetbasedonsalesinthisCommonwealth.Onecommentator,SierraResearch,whoseanalysisoftheProgramisrelieduponbyseveralothers,focuseditsanalysisalmostentirelyontheGHGprovisionsandontheincorrectassumptionthattheCommonwealthisproposingadoptionofaGHGfleetaveragerequirementbasedonsalesinthisCommonwealth,resultinginerroneousconclusionsthatarenotrelevant.Inaddition,theanalysisprovidednorelevantinformation,analysisordatatospecificallyrefutetheDepartment’sanalysisoftheemissionsimpactofpostponingthecompliancedateoftheCommonwealth’sexistingProgram.TheDepartment’sanalysisisbasedoncurrentEPAguidance.Furthermore,emissionreductionsthataretobeachievedinCalifornia,thisCommonwealthorelsewherefromCARB’sGHGprovisionsaredependentupontheEPAgrantingawaiverofpreemptiontoCAREfortheGHGemissionstandards.Undersection209(b)oftheCAA(42U.S.C.A.§7543(b)),Californiamustfirstfindthatitsstandardsare,intheaggregate,atleastasprotectiveofpublichealthandwelfareasapplicableFederalstandards.Californiahasalreadymadethisdetermination.TheEPAwillthenreviewCalifornia’s“protectiveness”findingandmustdenyawaiverifitdeterminesthatCalifornia’sfindingwasarbitraryandcapricious,amongotherthings.ThecommentatorwillhavetheopportunitytopresentitsanalysesofCARE’sGHGemissionstandardstotheEPAduringtheEPA’swaiverdecisionmakingprocess,whichincludesFederalpublicationofaproposeddecisionandapubliccommentperiod.IftheEPA(theagencythatpromulgatedtheTierIIstandards)grantsCAREawaiverofpreemptionfortheGHGstandards,thereshouldbenoquestionofwhetherCARE’sstandardsareasprotectiveasTierII.SierraResearchandDaimlerChryslerassertedthatadoptionofCALEVIIwiththeGHGprovisionsinthisCommonwealthwillresultinincreasedVOC,NON,COandPM25emissionsrelativetoabaselinewheretheFederalTierIIemissionsstandardsapply.TheDepartmentdisagreeswiththecommentators’analysisofthepurportedemissionsincrease.http://www.pabulletin.com/secure/data/vol36/36-49/2406a.html6/4/2007PA Bulletin,

Doc.

No. O624O6aç.

c

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8 of

22 The analysis incorrectly

assumes

that automakers

will

be required

to comply

with

the California

GHG

fleet average

based

on vehicles introduced

for

sale

in this Commonwealth. Because

this fundamental

assumption

is incorrect,

the commentators’

analysis

has little practical

value

with regard

to this fmal-form rulemaking.

In addition,

the analysis provided little,

if any, additional information,

analysis

or data

to specifically

refute

the Department’s analysis

of the emissions

impact

of postponing

the compliance

date

of the Commonwealth’s existing Program.

The Department’s

analysis

is based

on current

EPA guidance.- The Department

agrees

that emissions,

in general,

may

be influenced

in part

by three secondary

effects

of the GHG regulation

described

by

the commentators,

but

the commentators’

evaluation

of the magnitude

of these effects

in this Commonwealth

is flawed given

the commentators’

erroneous assumption

regarding

the GHG

fleet average.

In addition,

the commentators’

underlying assumptions

with regard

to the resultant

impact

of these effects

in California

were successfully

refuted

by CARB

in

its Final Statement

of Reasons.

The commentators

provided

little supporting

data

to allow

the Department

to replicate

and quantitatively

evaluate

the commentators’

claims.

The Department

disagrees that

the relative baseline

for comparison

of emissions,

for

the purpose

of the commentator’s analysis

to evaluate

the impacts

of the California

GHG provisions,

is the Federal

Tier

II program.

The California

standards

are currently incorporated

by reference

in the Commonwealth’s

regulations.

The purpose

of this final-form rulemaking

is

to postpone

the compliance

date

of the Program

from

MY 2006

to MY

2008

and specify

a 3-year

early- credit earning

period

within

which vehicle manufacturers

must

come

into compliance

with the NMOG

fleet average

of the Program.

The relative baseline,

therefore,

should

be

the

CA LEV

II standards

and

not

the Federal

Tier

II standards.

The commentator

did

not provide any comparison

of the GHG provision

impact

to the existing regulations

or the amendments to the Program.

The Department’s

analysis estimates

a reduction

of

7.8

to 16.9

tons

per

day of VOCs

and

9.7 tons

per

day

of NO

in 2025

by implementing

the Program

as

set forth

in the preambles

to the proposed

and final-form rulemakings.

The Department

continues

to agree

with CARE

that there would

be

a slight decrease

in NO

and VOC emissions

as

a result

of the GHG provisions,

but given

that

the Program

does

not require compliance

with a GHG

fleet average

based

on sales

in this Commonwealth

and

that automakers

will

still

be required

to meet

the NMOG

fleet average

based

on sales

in this Commonwealth

(thus ensuring reductions

over

Tier

II), these benefits

would

be secondary

and

are

not included

in the Department’s

analysis. Three industry commentators

claimed

that

the proposed rulemaking

would

have

no measurable

impact

on

the global climate

or the climate

of this Commonwealth

and

that

the means

for controlling

GHG

are being debated internationally

and

can only

be addressed effectively

on

a global

basis.

The Department

responds

that

the Commonwealth

expects

that the existing regulations

will make

a contribution

to the reduction

of GHGs,

which

will

help mitigate

global warming

and

its public

health

and environmental

effects.

A measurable effect

on temperatures

or

on ozone reduction

based

on effects

on temperatures

is not

the intent

of this final-form rulemaking. The Alliance commented

that

the California

GHG regulations

will

not improve

air quality because

the regulations

focus predominantly

on controlling

C0 2 ,

an inert

gas

that

is not toxic

to humans

or animals.

The commentator

argues

that control

of GHG emissions

is not

a pollution

issue

but

is

an energy

issue. Whether

GHGs, including

C0 2 ,

are

a pollutant

is

an issue currently

in litigation.

On November

29, 2006,

the Supreme

Court

of the United

States http ://www.pabulletin.comlsecure/datalvol3

6/3 6-49/2406a.html

6/4/2007PABulletin,Doc.No.06-2406aPage9of22heardoralagrumentonwhethertheEPAhasauthorityundertheCAAtoregulateGHGemissionsfromautomobiles.Massachusettsv.EPA,U.S.,No.05-1120.Threeindustrycommentatorsstatedthatstateshavenostatutoryauthorityandareexpresslyprohibitedfrompassingorenforcinganystatuteorregulationthatattemptstoreducecarbondioxidethroughtheregulationofvehiclefueleconomy.ThesecommentatorsnotethattheNationalHighwayTrafficSafetyAdministrationmadethesestatementsinbothitsproposedandfmalruleforaveragefueleconomystandardsforlighttrucks.TheDepartmentrespondsthattheissueofwhetherCalifornia’sGHGregulationattemptstoregulatevehiclefueleconomyiscurrentlybeinglitigatedinFederalcourtinCaliforniainCentralValleyChrysler-Jeep,Inc.v.CatherineE.Witherspoon,1:04-cv-06663-AWI-LJO.IftheCaliforniaregulationisoverturnedincourt,theCommonwealthwillnotrealizeGHGbenefitsfromCalifornia’sGHGprovisions.ThestatementsmadebytheNationalHighwayTrafficSafetyAdministrationweremadeinapreamble,notaregulation,anddonotcarrytheauthorityoflaw.SenatorsMadiganandWhitecommentedthattheDepartment’spreambletoutstheCaliforniastandardasameansofcontrollingcarbondioxide(GHG)emissions.TheystatedthattheDepartmentfailstoacknowledgethatreductionofCO2emissionsisnotarequirementoftheSIPortheCAA.TheysaidthattheDepartmentignoresaSeptember2003EPAGeneralCounseldeterminationthattheEPAdoesnothavetheauthorityunderFederallawtoregulatemotorvehicleemissionsofCO2orotherGHGs.TheDepartmentrespondsthatthepreambletotheproposedrulemakingstatedthatCaliforniarecentlyaddedaGHGfleetaveragerequirementtoitsLEVIIprogrambeginningwithMY2009,whichwillhavetobemetinCaliforniatoobtainCARBcertification.TheDepartmentisnotrequiringautomanufacturerstomeetafleetaverageforGHGsbasedonsalesinthisCommonwealth,but,asstatedinthepreamble,theDepartmentexpectsthattheCommonwealthwillrealizethebenefitsofCalifornia’sGHGcertifiedvehiclesthroughtheCommonwealth’sexistingrequirementthatnewvehicleshaveCARBcertification.ThepreambleexplainedthatCaliforniaestimatesthattheprogram,whenfullyphased-in,willprovideabouta30%reductioninGHGemissionsfromnewvehiclesrequiredtocomplycomparedtothe2002fleet.TheDepartmentanticipatesthatthisCommonwealthwillachievesimilarresults.TheDepartmentdidnotstateorimplythatreducingCO2emissionsintheProgramisarequirementoftheSIPortheCAA.TheDepartmentdoesnotignoretheSeptember2003EPAGeneralCounselopinionregardingGHGs;tothecontrary,thepreambleexpresslyacknowledgedthatCaliforniaiscurrentlydefendingitsGHGregulationsagainstlegalchallengesfiledbytheautoindustry.TheEPA’spositiononregulationofGHGsfrommotorvehiclesiscurrentlyunderreviewbytheSupremeCourtoftheUnitedStatesinthecaseofMassachusettsv.EPA,U.S.,No.05-1120.ThePennsylvaniaAAAFederationandseveralindustrycommentatorsobjectedtothecostsofcomplyingwiththeCaliforniaGHGrequirements.CARBhasestimatedtheadditionalpriceoftheGHGprovisionsatover$1,000pervehiclewhiletheautoindustrybelievesthepriceofallnewvehicleswouldincreaseabout$3,000onaveragepervehicle.InMY2009andbeyond,oncetheCaliforniaGHGprovisionstakeeffect,theDepartmentagreeswithCARB’spervehiclecostestimateofapproximately$1,000by2016andwithCARB’sestimatethatthiscostincreasewillbeoffsetbysavingstotheconsumerduetoincreasedoperationalefficiencyofthesevehicles.WhileCARBpredictedthatby2016theoperationalefficiencyofvehiclesmeetingGHGrequirementsmightactuallyaffordownersanoverallcostsavingsof$3.50to$7permonth(assuming$1.74pergallonofgasoline),http://www.pabulletin.comlsecure/data/vol36/36-49/2406a.html6/4/2007PA Bulletin,

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of

22 information

on initial

cost (which

could

be related

to sticker

price)

was

also estimated. Based

on separate

CARB estimates

for passenger

cars/small

trucks

and large trucks/SUVs and

the similar composition

of the fleet

in this Commonwealth,

consumers

could

see

an increase

in per vehicle

costs

of $21

for MY 2009,

$63

for MY 2010

and $219

for MY

2011 to about $1,000

in MY 2016.

CARB estimates

that

by 2016

the operational

efficiencies realized

by GHG technology

will result

in

an overall

savings

of $3.50

to

$7 per month

($42 to $84 dollars

per year)

based

on

a MY 2016 vehicle

costing

an additional

$1,029

to $1,064 per vehicle.

These savings

are probably understated,

since

the price

of gasoline

is likely

to remain

higher

than

that used

in CARB’s

analysis.

Several commentators

pointed

out

that historically,

cost projections

made

by both industry

and government

(EPA

and California) tend

to overstate

actual

costs. The Alliance

and

the Pennsylvania

AAA Federation commented

that

to meet

what

they referred

to

as the proposed

“fuel efficiency”

and emissions requirements

of CA LEV

II, vehicle

weight

and

size would

be reduced,

which

would

reduce consumer

utility

and contribute

to higher

traffic fatalities.

The Department

responds

as follows.

As indicated

by CARB

in

its Final Statement

of Reasons, California

law specifically

prohibits

CARB

from using weight reduction

or vehicle

class elimination

as

a mechanism

to achieve compliance with

the GHG provisions

of the CARB standard.

The Department

believes

that CARWs analysis

of the available technology

options

is sound

and agrees

that many

of the proposed technologies

are either

in current production

or

are

in late stage development

by automakers.

In addition,

the GHG provisions

provide sufficient

lead-time

for automakers

to cost-effectively

integrate

these existing technologies

into production.

The Department agrees

with CARB’s

analysis

of the GHG provisions

that weight reduction

strategies

are

not necessary.

Weight reduction

strategies

that

may

be employed

by automakers

are business decisions

by individual automakers

and

not

the result

of requirements

of either

the

CA LEV II standards

or the Program.

The Department

agrees

that Federal

motor vehicle

safety standards

will continue

to apply

to any vehicle introduced

for

sale

into

this Commonwealth. G. Benefits,

Costs

and Compliance Benefits The final-form rulemaking

will

save manufacturers,

dealers

and purchasers

of light-duty vehicles

and trucks

from incurring

additional

costs

for CARB-certifled

vehicles

for

2 model years. Implementation

of the Program

in accordance

with

the final-form rulemaking

will contribute

to the attainment

and maintenance

of the health-based

ozone NAAQS

in this Commonwealth

due

to emission reductions

from

the operation

of low emission passenger cars

and light-duty

trucks.

The Commonwealth’s

analyses

indicate

that,

by implementing the California

LEV

II program

under

the final-form rulemaking,

the Commonwealth

will experience

emission

benefits

when compared

to the Federal program.

By 2025,

when

full fleet turnover

is expected,

the California

LEV

II program

will provide

an additional reduction

of 2,850

to 6,170

tons

per year

of VOCs,

3,540

tons

per year reduction

of NO and

5%

to 11% more reduction

of

six toxic

air pollutants,

including

a 7%

to 15% additional benefit

for benzene,

a known carcinogen.

The Commonwealth

will

also realize

the benefits of California’s

GHG certified

vehicles.

CARB estimates

that

the program,

when

fully phased-in,

will provide

about

a 30% reduction

in GHG emissions

from

new vehicles required

to comply compared

to the 2002

fleet. In addition,

CARB predicted

that

by MY 2016

the operational

efficiency

savings

of http://www.pabulletin.com/secure/dataJvol3

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# CPage11of22vehiclesmeetingtheGHGrequirements,whichstartinMY2009,willaffordownersanoverallcostsavingsof$3.50to$7permonth,assumingapriceof$1.74pergallonofgasoline.Thesesavingsareprobablyunderstated,sincethepriceofgasolineislikelytoremainhigherthanthatusedinCARB’sanalysis.ComplianceCostsThefinal-formrulemakingwilldeferanycostsassociatedwithCARB-certifiedvehiclesfor2modelyears,fromMY2006toMY2008.Infact,asstated,costsavingswillberealized.Thefinal-formrulemakingwillapplytovehiclemanufacturers,newvehicledealers,leasingandrentalagenciesandotherregistrantswhosell,import,deliver,purchase,lease,rent,acquire,receive,titleorregisterlight-dutyautomobilesortrucksinthisCommonwealth.Nonewcostswillbeincurredasaresultofthefinal-formrulemakingcomparedtothecoststhatwouldbeexperiencedwithoutthefinal-formrulemaking,sincetheProgramisalreadyincorporatedbyreferenceintheCommonwealth’sregulations.InSeptember2004,CAREestimatedthatbyMY2016theoperationalefficiencysavingsofvehiclesmeetingGHGrequirementswillprovidevehicleownersanoverallcostsavingsof$3.50to$7permonth,assuming$1.74pergallonofgasoline.Thesesavingsareprobablyunderstated,sincethepriceofgasolineislikelytoremainhigherthanthatusedinCARB’sanalysis.CARBestimatedtheGHG-relatedinitialinvestmentcosts,possiblyreflectedinstickerprices,willstartunder$50pervehicleforMY2009,beapproximately$350in2012and$1,000pervehicleinMY2016.VehiclemanufacturersdisagreewithCARB’sGHGestimate,citinginitialcostsofasmuchas$3,000pervehicle.TheCommonwealthperiodicallyoffersrebatestoconsumersfortheinitialpurchaseofhybridelectricvehicles.TheserebatescouldoffsetadditionalinitialcoststhatmightbepassedontoconsumersundertheexistingoramendedProgram.ComplianceAssistancePlanComplianceassistancewiththeProgramwillbeprovidedtoaffectedparties,primarilynewvehicledealers,throughappropriateStatetradeorganizationsinthedistributionofinformationtotheirmembership.InformationconcerningtheProgramwillalsobeprovidedtoconsumersthroughthemedia,Departmentpublications,theInternetandappropriatemotoristandotherorganizations.TheCommonwealthoffersrebatestoconsumersfortheinitialpurchaseofhybridelectricvehicles.TheseincentivesmayhelpvehiclemanufacturersmeettheirobligationsundertheProgram.PaperworkRequirementsNoadditionalpaperworkrequirementswillbeimposedbythefinal-formrulemaking;theProgramalreadycontainspaperworkrequirements.WhentheProgramisimplemented,vehiclemanufacturerswillberequiredtosubmitpaperworkdemonstratingcompliancewiththeemissionstandardsandotherrequirementsoftheProgram.Motorvehicledealers,leasingandrentalagenciesandotherregistrantsandpersonsseekingtitleofnewmotorvehiclesmustdemonstratetotheDOT’sBureauofMotorVehiclesthatnewvehiclessubjecttotheProgramarethosecertifiedbyCalifornia.httn://www.nabulletin.com!secure/data!vo136/36-49/2406a.html6/4/2007PA Bulletin,

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22 H. Pollution Prevention The Federal Pollution Prevention

Act

of 1990

(42 U.S.C.A.

§ 13101--13109)

established a National

policy

that promotes

pollution prevention

as the preferred

means

for achieving state environmental

protection

goals.

The Department

encourages

pollution prevention, which

is the reduction

or elimination

of pollution

at

its source, through

the substitution

of environmentally

friendly materials,

more efficient

use

of raw materials

or the incorporation of energy efficiency

strategies.

Pollution prevention

practices

can provide

greater environmental

protection

with greater efficiency

because

they

can result

in significant

cost savings

to facilities

that permanently

achieve

or move beyond compliance.

This final-form rulemaking incorporated

the following

pollution prevention

provisions

and incentives. The existing regulations

and

the final-form rulemaking

give vehicle manufacturers

the freedom

to select technologies

that prevent pollution.

Similarly,

vehicle manufacturers

are given

the freedom

to select exhaust treatment technologies

to meet

the requirements.

Air pollution

will

be reduced

by requiring

vehicle manufacturers

to produce

vehicles

that lower emissions

at their source. I. Sunset Review These regulations

will

be reviewed

in accordance

with

the sunset review schedule published

by

the Department

to determine

whether

the regulations

effectively

fulfill

the goals

for which

they

were intended. J. Regulatory

Review Under

section

5(a)

of the Regulatory

Review

Act

(71

P.

S.

§ 745.5(a)),

on September

21, 2006,

the Department

submitted

a copy

of the notice

of proposed rulemaking,

published

at 36 Pa.B.

715,

to IRRC

and

the Chairpersons

of the House

and Senate Committees

for review

and comment. Under

section

5(c)

of the Regulatory

Review

Act, IRRC

and

the Committees

were provided

with copies

of the comments

received

during

the public comment

period,

as well as other documents

when requested.

In preparing

the final-form rulemaking,

the Department has considered

all comments

from IRRC,

the House

and Senate Committees

and

the public. Under

section

5.l(j.2)

of the Regulatory

Review

Act

(71

P.

S.

§ 745.5a(j.2)),

on November

1, 2006,

the final-form rulemaking

was deemed approved

by

the House

and Senate Committees.

Under

section

5.1(e)

of the Regulatory

Review

Act, IRRC

met

on November

2, 2006,

and approved

the final-form rulemaking. K. Findings The Board

finds

that: (1) Public

notice

of proposed rulemaking

was given

under sections

201

and

202

of the

act of July

31, 1968

(P.

L. 769,

No.

240)

(45

P.

5.

§ 1201

and 1202)

and regulations promulgated

thereunder,

1 Pa. Code

§

7.1

and

7.2. (2)

A public comment

period

was provided

as required

by law

and

all comments

were http://www.pabulletin.comlsecure/datalvol3

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6/4/2007PABulletin,Doc.No.06-2406aflCPage13of22considered.(3)Theseregulationsdonotenlargethepurposeoftheproposedrulemakingpublishedat36Pa.B.715.(4)TheseregulationsarenecessaryandappropriateforadministrationandenforcementoftheauthorizingactsidentifiedinSectionCofthisorder.(5)TheseregulationsarenecessaryfortheCommonwealthtoachieveandmaintainambientairqualitystandardsandtosatisfyrelatedCAArequirements.L.OrderTheBoard,actingundertheauthorizingstatutes,ordersthat:(a)TheregulationsoftheDepartment,25Pa.CodeChapters121and126,areamendedbyamending§121.1,126.401,126.411--126.413,126.421--126.425,126.431,126.432and126.441;bydeleting§126.402;andbyadding§126.451toreadassetforthinAnnexA,withellipsesreferringtotheexistingtextoftheregulations.(b)TheChairpersonoftheBoardshallsubmitthisorderandAnnexAtotheOfficeofGeneralCounselandtheOfficeofAttorneyGeneralforreviewandapprovalastolegalityandform,asrequiredbylaw.(c)TheChairpersonoftheBoardshallsubmitthisorderandAnnexAtoIRRCandtheSenateandHouseCommitteesasrequiredbytheRegulatoryReviewAct.(d)TheChairpersonoftheBoardshallcertifythisorderandAnnexAanddepositthemwiththeLegislativeReferenceBureau,asrequiredbylaw.(e)ThisordershalltakeeffectimmediatelyuponpublicationinthePennsylvaniaBulletin.KATHLEENA.MCGINTY,Chairperson(EditorNote:ForthetextoftheorderoftheIndependentRegulatoryReviewCommission,relatingtothisdocument,see36Pa.B.7082(November18,2006).)FiscalNote:FiscalNote7-398remainsvalidforthefinaladoptionofthesubjectregulations.AnnexATITLE25.ENVIRONMENTALPROTECTIONPARTI.DEPARTMENTOFENVIRONMENTALPROTECTIONhttn//wwwnahul1etincom/secure/datalvol36/36-49/2406a.html6/4/2007PA Bulletin,

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22 Subpart

C. PROTECTION

OF NATURAL RESOURCES ARTICLE

III. AIR RESOURCES CHAPTER

121. GENERAL PROVISIONS § 121.1. Definitions. The definitions

in section

3 of the

act

(35

P.

S.

§ 4003)

apply

to this article.

In addition, the following

words

and terms,

when

used

in this article,

have

the following

meanings, unless

the context

clearly indicates otherwise:***** Dealer--A

person

who

is engaged

in the

sale

or distribution

of new motor vehicles

or new motor vehicles

to the ultimate purchaser

as defined

in section

216(4)

of the Clean

Air

Act (42 U.S.C.A.

§ 7550(4)). De minimis

emission increase--An

increase

in actual

or potential

emissions

which

is below

the threshold

limits specified

in

§ 127.203

(relating

to facilities

subject

to special permit requirements).***** Fleet average--For

the purposes

of motor vehicles

subject

to Pennsylvania’s

Clean Vehicles

Program requirements,

a motor vehicle manufacturer’s

average

vehicle emissions of

all NMOG emissions

from vehicles

which

are produced

and delivered

for

sale

in this Commonwealth

in any model

year.***** LDT--light-duty

truck (i)

For purposes

of

§ 129.52 (relating

to surface

coating processes),

a light-duty

truck

is

a motor vehicle

rated

at 8,500 pounds

gross vehicle

weight

or less which

is designed primarily

for purposes

of transportation

or major components

of the vehicle, including,

but not limited

to, chassis,

frames,

doors

and engines. (ii)

For purposes

of Chapter

126, Subchapter

D (relating

to the Pennsylvania

Clean Vehicles Program),

a light-duty

truck

is

a motor vehicle

rated

at 8,500 pounds

gross vehicle weight

or less which

is designed

primarily

for purposes

of transportation

of property

or

is

a derivative

of such

a vehicle,

or

is available

with special features

enabling

off-street

or offhighway operation

and

use. LDV--light-duty

vehicle--A

passenger

car

or light-duty

truck.***** Lease custody transfer--The

transfer

of produced

crude

oil

or condensate,

after processing http://www.pabulletin.com/secure/data1vol36/3

6-49/2406a.html

6/4/2007PABulletin,Doe.No.06-2406aCCPage15of22ortreatingintheproducingoperations,fromstoragetanksorautomatictransferfacilitiestopipelinesorotherformsoftransportation.Limitedaccessspace--Internalsurfacesorpassagesofanaerospacevehicleorcomponenttowhichcoatingscannotbeappliedwithouttheaidofanairbrushoraspraygunextensionfortheapplicationofcoatings.*****NETS-NO1EmissionsTrackingSystem--ThecomputerizedsystemusedtotrackNOemissionsfromNOaffectedsources.NMOG--Nonmethaneorganicgases.*****Offsetvehicle--Alight-dutyvehiclewhichhasbeencertifiedbyCaliforniaassetforthinTitle13CCR,Division3,Chapter1.*****Yorkairbasin--ThepoliticalsubdivisionsinYorkCountyofManchesterTownship,NorthYorkBorough,SpringGardenTownship,SpringettsburyTownship,WestManchesterTownship,WestYorkBoroughandCityofYork.CHAPTER126.MOTORVEHICLEANDFUELSPROGRAMSSubchapterD.PENNSYLVANIACLEANVEHICLESPROGRAMGENERALPROVISIONS§126.401.Purpose.(a)Thissubchapterestablishesacleanvehiclesprogramundersection177oftheCleanAirAct(42U.S.C.A.§7507)designedprimarilytoachieveemissionreductionsoftheprecursorsofozoneandotherairpollutantsfromnewmotorvehicles.(b)ThesubchapteradoptsandincorporatesbyreferencecertainprovisionsoftheCaliforniaLowEmissionVehicleProgram.(c)ThesubchapteralsoexemptscertainnewmotorvehiclesfromthePennsylvaniaCleanVehiclesProgram.(d)TheDepartmentmaynotimplementorenforceanyvehicleemissionstandardwhichisnotlegallypermittedtoberegulatedundertheCleanAirActorotherapplicableFederalorStatelaworregulation.§126.402.(Reserved).httn//www.nahu11etin.com/seciire/datalvol36/36-49/24O6ahtmI6/4/2007PABulletin,Doe.No.06-2406a

CPage16of22LOWEMISSIONVEHICLES §126.411.Generalrequirements.(a)ThePennsylvaniaCleanVehiclesProgramrequirementsapplytoallnewpassengercarsandlight-dutytruckssold,leased,offeredforsaleorlease,imported,delivered,purchased,rented,acquired,received,titledorregisteredinthisCommonwealthstartingwiththe2008modelyearandeachmodelyearthereafter.(b)TheprovisionsoftheCaliforniaLowEmissionVehicleProgram,Title13CCR,Division3,Chapters1and2,areadoptedandincorporatedhereinbyreference,andapplyexceptforthefollowing:(1)ThezeroemissionsvehiclepercentagerequirementinTitle13CCR,Division3,Chapter1,

§1962.(2)TheemissionscontrolsystemwarrantystatementinTitle13CCR,Division3,Chapter1,§2039. §126.412.Emissionrequirements.(a)Startingwiththemodelyear2008,apersonmaynotsell,import,deliver,purchase,lease,rent,acquire,receive,titleorregisteranewlight-dutyvehicle,subjecttothePennsylvaniaCleanVehiclesProgramrequirements,inthisCommonwealththathasnotreceivedaCARBExecutiveOrderforallapplicablerequirementsofTitle13CCR,incorporatedhereinbyreference.(b)Startingwiththemodelyear2008,compliancewiththeNMOGfleetwideaverageinTitle13CCR,Division3,Chapter1,§1961shallbedemonstratedforeachmotorvehiclemanufacturerbasedonthenumberofnewlight-dutyvehiclesdeliveredforsaleinthisCommonwealth.(c)CreditsanddebitsforcalculatingtheNMOGfleetaverageshallbebasedonthenumberoflight-dutyvehiclesdeliveredforsaleinthisCommonwealthandmaybeaccruedandutilizedbyeachmanufactureraccordingtoproceduresinTitle13CCR,Division3,Chapter1.(d)NMOGfleetaveragecreditsgeneratedduringthe2008,2009and2010modelyearsmaybeappliedtowardanyofthemodelyears2008through2010forthepurposeofdemonstratingcompliancewithsubsections(b)and(c).ThecreditsgeneratedduringthisperiodmaybeappliedatfullvalueforanyoftheModelYears2008--2010.(e)NewmotorvehiclessubjecttothissubchaptermustpossessavalidemissionscontrollabelwhichmeetstherequirementsofTitle13CCR,Division3,Chapter1. §126.413.Exemptions.(a)ThefollowingnewmotorvehiclesareexemptfromthePennsylvaniaCleanVehiclesProgramrequirementsofthissubchapter:http://www.pabulletin.comlsecure/data!vol36/36-49/2406a.html6/4/2007PABulletin,Doc.No.06-2406aC’Page17of22(1)Emergencyvehicles.(2)Alight-dutyvehicletransferredbyadealertoanotherdealerforultimatesaleoutsideofthisCommonwealth.(3)Alight-dutyvehicletransferredforuseexclusivelyoff-highway.(4)Alight-dutyvehicletransferredforregistrationout-of-State.(5)Alight-dutyvehiclegrantedaNationalsecurityortestingexemptionundersection203(b)(1)oftheCleanAirAct(42U.S.C.A.§7522(b)(l)).(6)Alight-dutyvehicleheldfordailyleaseorrentaltothegeneralpublicwhichisregisteredandprincipallyoperatedoutsideofthisCommonwealth.Forpurposesofthisparagraph,alight-dutyvehicleisdeemedtobeprincipallyoperatedoutsideofthisCommonwealthifitisregisteredoutsideofthisCommonwealthinaccordancewiththeInter-JurisdictionalAgreementonApportioningVehicleRegistrationFeesdevelopedundertheIntermodalSurfaceTransportationandEfficiencyActof1991(Pub.L.102-240,105Stat.1914),andknownastheInternationalRegistrationPlan,orasuccessorplanforapportioningvehicleregistrationfeesinternationally.(7)Alight-dutyvehicleengagedininterstatecommercewhichisregisteredandprincipallyoperatedoutsideofthisCommonwealth.(8)Alight-dutyvehicleacquiredbyaresidentofthisCommonwealthforthepurposeofreplacingavehicleregisteredtotheresidentwhichwasdamaged,orbecameinoperative,beyondreasonablerepairorwasstolenwhileoutofthisCommonwealthifthereplacementvehicleisacquiredoutofthisCommonwealthatthetimethepreviouslyownedvehiclewaseitherdamagedorbecameinoperativeorwasstolen.(9)Alight-dutyvehicletransferredbyinheritanceorcourtdecree.(10)Alight-dutyvehicledefinedasamilitarytacticalvehicleorenginesusedinmilitarytacticalvehiclesincludingavehicleorengineexcludedfromregulationunder40CFR85.1703(relatingtoapplicationofsection216(2)).(11)Alight-dutyvehicletitledorregisteredinthisCommonwealthbeforeDecember9,2006.(12)Alight-dutyvehiclehavingacertificateofconformityissuedundertheCleanAirActandoriginallyregisteredinanotherstatebyaresidentofthatstatewhosubsequentlyestablishesresidenceinthisCommonwealthanduponregistrationofthevehicleprovidessatisfactoryevidencetotheDepartmentofTransportationofthepreviousresidenceandregistration.(13)Avehicletransferredforthepurposeofsalvage.(b)Totitleorregisteranexemptedvehicle,thepersonseekingtitleorregistrationshallprovidesatisfactoryevidence,asdeterminedbytheDepartmentofTransportation,demonstratingthattheexemptionisapplicable.http://www.pabulletin.comlsecure/data/vol36/36-49/2406a.html6/4/2007PA Bulletin,

Doe.

No. O624O6a(_.

Page

18

of

22 APPLICABLE

NEW MOTOR VEHICLE

TESTING § 126.421.

New motor vehicle certification

testing. (a) Prior

to being offered

for

sale

or lease

in this Commonwealth,

new motor vehicles subject

to the Pennsylvania

Clean Vehicles

Program requirements

must

be certified

as meeting

the motor vehicle requirements

of Title

13 CCR, Division

3, Chapter

1,

§ 1961,

as determined

by testing

in accordance

with

Title

13 CCR, Division

3, Chapter

2. (b)

For purposes

of complying

with subsection

(a), new vehicle certification

testing determinations

and fmdings

made

by CARB

are applicable

and shall

be provided

by motor vehicle manufacturers

to the Department

upon

a written

request. § 126.422.

New motor vehicle compliance

testing. (a) Prior

to being offered

for

sale

or lease

in this Commonwealth,

new motor vehicles subject

to the Pennsylvania

Clean Vehicles

Program requirements

of this subchapter

must be certified

as meeting

the motor vehicle requirements

of Title

13 CCR, Division

3, Chapter 1,

§ 1961,

as determined

by New Vehicle Compliance

Testing, conducted

in accordance with

Title

13 CCR, Division

3, Chapter

2. (b)

For purposes

of complying

with subsection

(a), new vehicle compliance

testing determinations

and fmdings

made

by CARB

are applicable

and shall

be provided

by motor vehicle manufacturers

to the Department

upon

a written

request. § 126.423. Assembly

line testing. (a) Each manufacturer

of new motor vehicles

subject

to the Pennsylvania

Clean Vehicles Program requirements

of this subchapter,

certified

by CARE

and

sold

or leased

in this Commonwealth,

shall conduct inspection

testing

and quality

audit testing

in accordance with

Title

13 CCR, Division

3, Chapter

2. (b)

For purposes

of complying

with subsection

(a), inspection

testing

and quality

audit testing determinations

and findings

made

by CARE

are applicable

and

shall

be provided

by motor vehicle manufacturers

to the Department

upon

a written

request. (c)

If

a motor vehicle manufacturing

facility

which manufactures

vehicles

for

sale

in this Commonwealth

certified

by CARB

is not subject

to the inspection

testing

and quality

audit testing requirements

of CARE,

the Department

may,

after consultation

with CARB,

require testing

in accordance

with

Title

13 CCR, Division

3, Chapter

2. Upon

a manufacturer’s written

request

and demonstration

of need, functional

testing

under

the procedures incorporated

in Title

13 CCR, Division

3, Chapter

2,

of

a statistically

significant

sample, may substitute

for

the 100% testing

rate required

in Title

13 CCR, Division

3, Chapter

2, with

the written

consent

of the Department. § 126.424.

In-use

motor vehicle enforcement

testing. (a)

For purposes

of detection

and repair

of motor vehicles

subject

to the Pennsylvania Clean Vehicles

Program requirements

which

fail

to meet

the motor vehicle emission http ://www.pabulletin.comlsecure/datalvol3

6/3 6-49/2406a.html

6/4/2007PA’Bulletin,Doe.No.06-2406aCCPage19of22requirementsofTitle13CCR,Division3,Chapter1,theDepartmentmay,afterconsultationwithCARB,conductin-usevehicleenforcementtestinginaccordancewiththeprotocolandtestingproceduresinTitle13CCR,Division3,Chapter2.(b)Forpurposesofcompliancewithsubsection(a),in-usevehicleenforcementtestingdeterminationsandfindingsmadebyCARBareapplicableandshallbeprovidedbymotorvehiclemanufacturerstotheDepartmentuponawrittenrequest.(c)Theresultsoftestingconductedunderthissectionwillnotaffecttheresultofanyemissiontestconductedunder67Pa.CodeChapter177(relatingtoenhancedemissioninspection).§126.425.In-usesurveillancetesting.(a)ForpurposesoftestingandmonitoringtheoveralleffectivenessofthePennsylvaniaCleanVehiclesProgramincontrollingemissions,theDepartmentmayconductin-usesurveillancetestingafterconsultationwithCARB.(b)Forpurposesofprogramplanningandanalysis,in-usesurveillancetestingdeterminationsandfmdingsmadebyCARBareapplicableandshallbeprovidedbymotorvehiclemanufacturerstotheDepartmentuponawrittenrequest.(c)Theresultsofin-usesurveillancetestingconductedunderthissectionwillnotaffecttheresultofanyemissiontestconductedunder67Pa.CodeChapter177(relatingtoenhancedemissioninspection).MOTORVEHICLEMANUFACTURERS’OBLIGATIONS§126.431.Warrantyandrecall.(a)AmanufacturerofnewmotorvehiclessubjecttothePennsylvaniaCleanVehiclesProgramrequirementsofthissubchapterwhicharesold,leased,offeredforsaleorlease,titledorregisteredinthisCommonwealth,shallwarranttotheownerthateachvehiclemustcomplyoveritsperiodofwarrantycoveragewiththerequirementsofTitle13CCR,Division3,Chapter1,§2035--2038,2040and2041.(b)Eachmotorvehiclemanufacturershall,uponawrittenrequest,submittotheDepartmentfailureofemission-relatedcomponentsreports,asdefinedinTitle13CCR,Division3,Chapter2,formotorvehiclessubjecttothePennsylvaniaCleanVehiclesProgramincompliancewiththeproceduresinTitle13CCR,Division3,Chapter2.Forpurposesofcompliancewiththissubsection,amanufacturermaysubmitcopiesofthereportssubmittedtoCARB.(c)FormotorvehiclessubjecttothePennsylvaniaCleanVehiclesProgram,anyvoluntaryorinfluencedemission-relatedrecallcampaigninitiatedbyanymotorvehiclemanufacturerunderTitle13CCR,Division3,Chapter2,shallextendtoallmotorvehiclessold,leased,offeredforsaleorlease,titledorregisteredinthisCommonwealththatwouldbesubjecttotherecallcampaignifsold,leased,offeredforsaleorleaseorregisteidasanewmotorvehicleinCalifornia,unlesswithin30daysofCARBapprovaloftherecallcampaign,themanufacturerdemonstrates,inwriting,totheDepartment’ssatisfactionthathttp://www.pabulletin.comlsecure/datalvol36/36-49/2406a.html6/4/2007PA Bulletin,

Doe.

No. 06-2406a

C’

Page

20

of

22 the recall campaign

is not applicable

to vehicles

sold, leased,

offered

for

sale

or lease,

titled or registered

in this Commonwealth. (d)

For motor vehicles

subject

to the Pennsylvania

Clean Vehicles

Program,

any order issued

by

or enforcement

action

taken

by CARB

to correct noncompliance

with

any provision

of Title

13 CCR,

which

results

in the recall

of any vehicle pursuant

to Title

13 CCR, Division

3, Chapter

2, shall

be deemed

to apply

to

all motor vehicles

sold, leased, offered

for

sale

or lease,

titled

or registered

in this Commonwealth

that would

be subject

to the order

or enforcement

action

if sold, leased,

offered

for

sale

or lease

or registered

as

a new motor vehicle

in California,

unless

within

30 days

of issuance

of the CARB

action,

the manufacturer

demonstrates,

in writing,

to the Department’s

satisfaction

that

the action

is not applicable

to vehicles

sold, leased,

offered

for

sale

or lease,

titled

or registered

in this Commonwealth. § 126.432. Reporting requirements. (a)

For

the purposes

of determining

compliance

with

the Pennsylvania

Clean Vehicles Program, commencing

with

the 2008 model

year,

each manufacturer

shall submit annually to the Department,

within

60 days

of the

end

of each model

year,

a report documenting

the total deliveries

for sale

of vehicles

in each

test group

over

that model

year

in this Commonwealth. (b)

For purposes

of determining

compliance

with

the Pennsylvania

Clean Vehicles Program,

each motor vehicle manufacturer

shall submit annually

to the Department,

by March

1 of the calendar

year following

the close

of the completed

model

year,

a report

of the fleet average

NMOG emissions

of

its total deliveries

for

sale

of LDVs

in each

test group for Pennsylvania

for that particular

model

year.

The

fleet average

report, calculating compliance

with

the fleetwide

NMOG

exhaust emission

average,

shall

be prepared according

to the procedures

in Title

13 CCR, Division

3, Chapter

1. (c) Fleet average

reports

must,

at

a minimum,

identify

the total number

of vehicles, including

offset vehicles,

sold

in each

test group delivered

for

sale

in this Commonwealth, the specific

vehicle

models comprising

the sales

in each

state

and

the corresponding certification

standards,

and

the percentage

of each model

sold

in this Commonwealth

in relation

to total

fleet

sales. (d) Compliance

with

the NMOG

fleet average

for

the 2008,

2009

and 2010 model

years must

be demonstrated

following

the completion

of the 2010 model

year. MOTOR VEHICLE

DEALER RESPONSIBILITIES § 126.441. Responsibilities

of motor vehicle

dealers. A dealer

may

not

sell,

offer

for

sale

or lease,

or deliver

a new motor vehicle

subject

to this subchapter

unless

the vehicle

has received

the certification

described

in

§ 126.421

and 126.422

(relating

to new motor vehicle certification

testing;

and

new motor vehicle compliance

testing),

and conforms

to the following

standards

and requirements

contained

in Title

13 GJOR, Division

3, Chapter

2,

§ 2151: (1) Ignition

timing

is set

to manufacturer’s

specification

with

an allowable

tolerance

of http ://www.pabulletin.comlsecure/data/vol3

6/3 6-49/2406a.html

6/4/2007