Report on Reductions Achieved from Incentive-Based 

Emission Reduction Measures in the San Joaquin Valley

Release Date: September 22, 2014

Hearing Date: October 23, 2014

Air Resources Board

California Environmental Protection Agency
Electronic copies of this report are online at http://www.arb.ca.gov/planning/sip/sip.htm. 

Alternatively, paper copies may be obtained from the Visitors and Environmental Services 

Center of the Air Resources Board, located at 1001 I Street, Sacramento, California 95814, or 

by contacting ARB’s Office of Communications at (916) 322-2990.

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interpreter services, please contact ARB’s Bilingual Manager at (916) 323-7053.

This document has been prepared by the staff of the Air Resources Board. Publication 

does not signify that the contents reflect the views and policies of the Air Resources 

Board, nor do trade names or commercial products constitute endorsement or 

recommendation for use.

Please send written comments to:

Carol Sutkus, Manager

South Coast Air Quality Planning Section

Air Resources Board

P.O. Box 2815

Sacramento, California 95812

Phone: (916) 322-1229

Email: carol.sutkus@arb.ca.gov

For general questions, contact:

Tiffany Mateo, Air Resources Engineer

South Coast Air Quality Planning Section

Phone: (916) 445-0098

Email: tiffany.mateo@arb.ca.gov
Table of Contents

 

I. OVERVIEW....................................................................................................... 1

II. ARB INCENTIVE PROGRAMS BACKGROUND ............................................ 2

III. U.S. EPA PROGRAM REQUIREMENTS ....................................................... 4

IV. DEMONSTRATION THAT INCENTIVE-BASED EMISSION REDUCTION 

MEASURES MEET U.S. EPA REQUIREMENTS................................................ 5

V. EMISSION REDUCTIONS............................................................................. 22

VI. RECOMMENDATION................................................................................... 25

APPENDICIES

APPENDIX A: 2005 Carl Moyer Memorial Air Quality Standards Attainment 

Program Guidelines

APPENDIX B: 2008 Carl Moyer Memorial Air Quality Standards Attainment 

Program Guidelines

APPENDIX C: 2011 Carl Moyer Memorial Air Quality Standards Attainment 

Program Guidelines

APPENDIX D: Prop 1B Goods Movement – 2008 Program Guidelines for 

Implementation

APPENDIX E: Prop 1B Goods Movement – 2010 Program Guidelines for 

Implementation

APPENDIX F: Moyer Program Integrity Demonstration

APPENDIX G: Prop 1B Integrity Demonstration

APPENDIX H: SIP Creditable Incentive Projects in the San Joaquin Valley
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September 22, 2014 1

I. OVERVIEW

In 2008, the Air Resource Board (ARB or Board) adopted a State Implementation Plan 

(SIP) for the San Joaquin Valley to attain the 15 μg/m3annual PM2.5 standard 

(SJV PM2.5 Plan). In 2011, ARB amended the SJV PM2.5 Plan to reflect recently 

adopted ARB regulations and on November 9, 2011, the U.S. Environmental Protection 

Agency (U.S. EPA) approved the amended SJV PM2.5 Plan. In the SJV PM2.5 Plan, 

ARB committed to achieve the aggregate emission reductions necessary to reach the 

attainment emissions targets via ongoing reductions from the State’s existing control 

program, new emission reduction measures described in the SIP, or alternative 

emission reduction measures including incentive programs. The purpose of this Report 

is to document the reductions that have been achieved from California incentive-based 

emission reduction measures pertaining to the SJV PM2.5 Plan aggregate emission 

reduction commitment. 

California’s overall enforceable commitment in the SJV PM2.5 Plan is to reach the level

of emissions specified in the attainment demonstration for each precursor that 

contributes to formation of a pollutant. The total emission reductions necessary to fulfill 

that enforceable commitment equals the difference between emission levels in the 

relevant base year and the target emission levels required in the attainment year. The 

element of the plan for achieving the necessary emission reductions to attain a National 

Ambient Air Quality Standard (NAAQS or standard) is referred to as its “control 

strategy.” 

A control strategy may rely upon three methods of achieving the necessary emission 

reductions: ongoing reductions that occur each year through implementation of 

previously adopted control measures; a commitment to propose action on a specified 

list of new measures; and a commitment to achieve aggregate emission reductions 

through the adoption of new regulations, or alternative emission reduction measures 

including emission reductions from incentive programs. 

The Clean Air Act (Act) directly provides for the use of economic incentives as a means 

states may use to reach attainment of air quality standards. (See Act sections 

110(a)(2)(A) and 172(c)(6)). In broad terms, economic incentive programs use 

market-based strategies to encourage emission reductions from stationary, area, and/or 

mobile sources. U.S. EPA has actively encouraged states to utilize economic incentive 

programs as a means of achieving needed reductions in light of the increasing 

incremental cost associated with further emission reductions from stationary and mobile 

sources via traditional regulations. U.S. EPA guidelines specify that four “integrity 

elements” must be satisfied before reductions from an incentive-based emission 

reduction measure may be credited towards meeting a SIP commitment. Specifically, 

creditable emission reductions must be enforceable, quantifiable, surplus, and 

permanent. 

A combined strategy based on reductions from both regulations and incentive-based 

emission reduction measures is critical to California’s continued effort to attain the 
September 22, 2014 2

standards. Implementation of the SJV PM2.5 Plan has led to the adoption of Statewide 

rules and regulations as well as San Joaquin Valley Air Pollution Control District 

(District) rules that have achieved significant emission reductions in the San Joaquin 

Valley. These rules and regulations have been approved by U.S. EPA as part of 

meeting ARB’s SIP commitment. ARB has also allocated funding for incentive 

programs in the San Joaquin Valley that accelerate the purchase of cleaner 

technologies beyond those achieved by regulations alone. Specifically these are the 

Carl Moyer Memorial Air Quality Standards Attainment Program (Moyer Program) and 

Proposition 1B: Goods Movement Emission Reduction Program (Prop 1B).

This Report quantifies the ARB and District-administered emission reductions from 

Moyer Program off-road equipment repower, replacement, and retrofit projects using 

2005, 2008, and 2011 Moyer Program Guidance; portable and stationary agricultural 

source projects using 2005, 2008, and 2011 Moyer Program Guidance; and on-road 

vehicle replacement projects using 2008 and 2010 Prop 1B Guidelines, that provide

emission reductions throughout the 2014 attainment year in the SJV PM2.5 Plan. The 

report also demonstrates how the reductions meet U.S. EPA requirements for credit 

toward fulfilling the aggregate emission reductions commitment in the SJV PM2.5 Plan. 

If approved by the Board, this Report on reductions achieved from incentive-based 

emission reduction measures in the San Joaquin Valley will be submitted to U.S. EPA 

for inclusion in the California SIP. 

The sections below provide background on ARB incentive programs, a discussion of the 

U.S. EPA integrity elements that need to be satisfied to ensure that the incentive-based 

emission reduction measures are SIP creditable, and a corresponding demonstration for 

each project type. Finally, the Report identifies the total emission reductions from these 

incentive-based emission reduction measures to be credited towards the State 

aggregate commitment in the San Joaquin Valley. The appendices include the relevant 

incentive program guidelines, Moyer Program and Prop 1B integrity demonstrations, 

and the list of projects that provide the emission reductions from incentive-based 

emission reduction measures in the San Joaquin Valley.

II. ARB INCENTIVE PROGRAMS BACKGROUND

Measures adopted by ARB and the District as part of implementing the SJV PM2.5 Plan

have significantly reduced emissions in the San Joaquin Valley. These reductions are 

the result of ARB’s long-standing mobile source control program, along with more 

recent measures such as the Truck and Bus Regulation, the In-Use Off-Road Diesel 

Vehicle Regulation, and District stationary source control measures. While the benefits 

of these measures are significant, reductions from incentive-based emission reduction 

measures are also critical to continue reducing emissions in the San Joaquin Valley.

Incentive programs achieve emission reductions beyond those required by regulations 

by providing grants to private and public entities for the introduction of cleaner 

technologies earlier than what is required by regulation alone. California has made a 

substantial investment in incentive programs for the last 15 years. The Moyer Program 
September 22, 2014 3

and Prop 1B are two key incentive programs that achieve quantifiable emission 

reductions throughout the State and in the San Joaquin Valley. 

To date, the Moyer Program has provided more than $900 million that has been used to 

replace over 41,000 highly polluting engines throughout the State. Cumulatively, the 

Moyer Program has reduced approximately 150,000 tons of ozone precursor and 

6,300 tons of particulate matter emissions. Local districts direct the money to cost 

effective projects specific to their district. In the 2014/15 fiscal year, $12 million will be 

available for Moyer Program projects in the San Joaquin Valley. More information 

regarding the Moyer Program can be found at 

http://www.arb.ca.gov/msprog/moyer/moyer.htm, including program guidelines and air 

district implementation information.

Prop 1B is a partnership between ARB and agencies (such as air districts and seaports) 

to reduce air pollution emissions and health risk from freight movement along 

California’s trade corridors. ARB has awarded $718 million over multiple fiscal years to 

nine local agencies who are impacted by freight movement. In the 2013/14 fiscal year, 

approximately $32 million is available for Prop 1B projects in the San Joaquin Valley. 

The Prop 1B Goods Movement Program Guidelines for Implementation requires local 

agencies to identify and implement mechanisms for the public to provide input to the 

local agency on the equipment project solicitations, and to post the competitively ranked 

list of equipment projects on the local agency website. More information regarding 

Prop 1B, including semi-annual reports to the Department of Finance (DOF), can be 

found at http://www.arb.ca.gov/bonds/gmbond/gmbond.htm. 

 

Funds are allocated for incentive programs through a public process. ARB works 

collaboratively with the air districts and other stakeholders to develop funding guidelines 

for the Moyer Program and Prop 1B incentive program. To allow for public review and 

comment, ARB publishes proposed guidelines, holds public workshops, and adopts the 

guidelines at a public hearing. Both sets of guidelines have been adopted or approved 

by the ARB. The District administers the Moyer Program and Prop 1B incentive funds 

allocated to the San Joaquin Valley. Through a public process, following ARB adopted 

guidelines, the District selects and funds emission reduction projects. ARB program 

guidelines are included in this Report as Appendices A through E and the District’s 

Manual of Procedures for incentive programs can be found at 

http://www.valleyair.org/MOP/mop9610_idx.htm. 

The Moyer Program and Prop 1B incentive programs have been developed around 

several core principles, including cost-effectiveness, integrity, effective program 

administration, customer service, efficient use of District resources, fiscal transparency, 

and public accountability. In general, for each applicant, the District reviews the 

application, conducts a pre-inspection, and obtains usage documentation prior to 

signing a contract. Once the engine/vehicle is purchased and/or installed, the District 

conducts a post inspection and subsequently confirms that the old engine/vehicle has 

been destroyed. Throughout the contract life, the grantee is required to report to the 

District on the usage of the engine/vehicle.
September 22, 2014 4

To ensure public funds are spent appropriately and as intended, the District incentive 

program is regularly audited by outside agencies, including professional accountancy 

corporations on behalf of the federal government, ARB, DOF, and the California Bureau 

of State Audits. These comprehensive independent audits focus on every aspect of 

District-administered incentive programs, including internal programmatic and fiscal 

policies and procedures as well as field validation of projects. 

On June 20, 2013, the District adopted Rule 9610: State Implementation Plan Credit for 

Emission Reductions Generated through Incentive Programs (Rule 9610). Rule 9610 

provides an administrative mechanism for the District to quantify emission reductions 

achieved through incentive programs administered by the District. Rule 9610 also 

requires that the District prepare and submit to ARB, through a public process, an 

Annual Demonstration Report that demonstrates the quantity of SIP-creditable emission 

reductions.

 

III. U.S. EPA PROGRAM REQUIREMENTS

According to U.S. EPA guidelines, there are four necessary elements to demonstrate 

the integrity of incentive programs that are to be credited as achieving emission 

reductions towards a SIP – the reductions from these programs must be enforceable, 

quantifiable, surplus, and permanent.1 These integrity elements are defined below. 

Enforceable: Emission reductions and/or required actions are enforceable if they are 

independently verifiable and practically enforceable consistent with U.S. EPA guidance; 

program violations are defined; those liable can be identified; the state or U.S. EPA may 

apply penalties and secure corrective action where applicable; citizens have access to 

all emissions-related information obtained from participating sources. 

Quantifiable: To show that emission reductions from these incentive programs are 

quantifiable, the emission reductions must be measured in a reliable manner that can 

be replicated. 

Surplus: Emission reductions are surplus when they are not otherwise required by or 

assumed in a SIP-related program (e.g., an attainment or reasonable further progress 

plan or a transportation conformity demonstration), any other adopted state/local air 

quality program, a consent decree, or a federal rule designed to reduce criteria pollutant 

or precursor emissions. Also, emission reductions are “surplus” only for the remaining 

useful life of the vehicle, engine or equipment being replaced. 

 

 

1

See “Guidance on Incorporating Voluntary Mobile Source Emission Reduction Programs in State 

Implementation Plans (SIPs),” October 24, 1997, at pages 6-7; “Improving Air Quality with Economic 

Incentive Programs,” January 2001 at Section 4.1; “Incorporating Emerging and Voluntary Measures in a 

State Implementation Plan (SIP),” September 2004 at pages 3-4; and “Diesel Retrofits: Quantifying and 

Using Their Emission Benefits in SIPs and Conformity,” February 2014 at pages 27-29. 
September 22, 2014 5

Permanent: Emission reductions from incentive programs are permanent if the State

and U.S. EPA can ensure that emission reductions occur for as long as they are relied 

upon in the SIP, and no longer than the remaining useful life of the vehicle, engine or 

equipment being replaced.

IV. DEMONSTRATION THAT INCENTIVE-BASED EMISSION 

REDUCTION MEASURES MEET U.S. EPA REQUIREMENTS

This section includes the integrity demonstration for the Moyer Program off-road 

equipment repower, replacement, and retrofit projects using 2005, 2008, and 2011 

Moyer Program Guidelines, portable and stationary agricultural source projects using 

2005, 2008, and 2011 Moyer Program Guidance and on-road vehicle replacement 

projects using 2008 and 2010 Prop 1B Guidelines as incentive-based emission 

reduction measures. All project types satisfy the U.S. EPA integrity element 

demonstrations, therefore emission reductions achieved through these projects are SIP 

creditable. Appendices F and G contain the Moyer Integrity Demonstration, as of 

December 31, 2013, and the Prop 1B Integrity Demonstration, as of August 2013, 

respectively.

A. General Moyer Program Requirements

The Moyer Program funds the incremental cost of cleaner-than-required sources of air 

pollution (e.g. diesel engines) and has provided over $900 million in State and local 

funds to reduce emissions from over 41,000 engines in its first 15 years. ARB adopted 

the first set of Moyer Program Guidelines in early 1999, and legislation (Assembly Bill 

(AB) 1571) enacted in 1999 formally established the statutory framework for the 

program (Health & Safety Code § 44275, et seq.). Multiple changes have been made 

since the original guidelines were developed, and ARB continues to update the program 

guidelines, following public processes, in response to legislative and regulatory changes 

and to ensure that emission reductions funded through the Moyer Program are “real, 

surplus, quantifiable, and enforceable” consistent with the underlying statutory 

mandates. ARB is required to make proposed changes to the Guidelines available to 

the public at least 45 days prior to final adoption and is required to hold one public 

meeting to consider public comments before final adoption of any changes. The Moyer 

Program is implemented through a partnership between ARB and local air districts. 

ARB manages program funds and distributes them to participating air districts for 

program implementation each year; develops and revises guidelines, protocols, and 

criteria for covered projects; and determines methodologies used for evaluating project 

cost-effectiveness. Air districts follow the Moyer Program Guidelines to select, fund, 

and monitor projects in their areas. The Guidelines describe requirements for 

administrative procedures, eligibility criteria for projects in different source categories, 

cost-effectiveness criteria, and reporting practices. 

The following discussion will show how the 2005, 2008 and 2011 Moyer Program 

Guidelines meet the four integrity elements.
September 22, 2014 6

General Moyer Program Enforceable

Specific funding criteria established in the Moyer Program Guidelines help ensure that 

emission reductions sought for projects funded according to the guidelines will be 

independently verifiable and practicably enforceable by ARB and the District consistent 

with U.S. EPA policy. In order for projects to be considered for funding, a complete 

application must be submitted by the applicant to the District. The requirements for the 

applications are in:

 2008 Moyer Program Guidelines, Part III, Minimum Project Application 

Requirements at 29

 2011 Moyer Program Guidelines, Part I, Minimum Project Application 

Requirements at 3-26

These sections require that “information regarding previous years of existing engine 

usage (e.g. miles traveled, hours operated, or fuel consumed per year) must be 

documented and included in the project application.” These sections also specify that 

minimum annual usage is not required to be included in the contract for projects which 

have 24 months of verified and documented historical usage. In addition, the applicant 

is required to certify that the information provided in the application is accurate and 

correct. See 2008 Moyer Program Guidelines, Part III, Section 26(e)(5) at 31; 

2011 Moyer Program Guidelines, Section W.5 at 3-26. In contrast with the 2008 and 

2011 Moyer Program Guidelines which have compiled application requirements into the 

Minimum Project Application Requirements section, the minimum application 

requirement for the 2005 Moyer Program Guidelines are included in the project criteria 

chapters and are discussed in the project type specific sections below. 

Once the District has selected a project for funding through the Moyer Program, the 

District must execute contracts with the grantees who will receive funds under the 

Moyer Program. The requirements for these contracts, which are legally enforceable by 

ARB or the District, are in:

 2005 Moyer Program Guidelines, Part I, Minimum Contract Requirements at II-28

 2008 Moyer Program Guidelines, Part III, Minimum Contract Requirements at 34

 2011 Moyer Program Guidelines, Part I, Minimum Contract Requirements at 3-31

Per these provisions, each equipment project contract must include: (1) the name and 

contact information of the grantee; (2) specified timeframes for “project completion” (the 

date the project post-inspection confirms that the project has become operational) and 

“project implementation” (the project life used in the project cost-effectiveness 

calculation); (3) detailed documentation adequate to establish historical annual usage; 

(4) requirements for the grantee to maintain the vehicle, equipment and/or engine 

according to the manufacturer’s specifications for the life of the project; (5) annual 

reporting requirements; (6) a provision authorizing the District, ARB, and their 

designees to conduct fiscal audits and to inspect the project engine, vehicle, and/or

equipment and associated records during the contract term, and (7) requirements to 

maintain and retain project records for at least two years after contract expiration or 
September 22, 2014 7

three years after final project payment, whichever is later. These requirements ensure 

that projects are carried out as anticipated, provide the District, ARB and the public with 

data needed to verify the project emission reductions and help ensure that violations 

can be identified. Contract non-performance is included in the above sections regarding 

minimum contract requirements with more details of actions towards non-performing 

projects included in:

 2005 Moyer Program Guidelines, Part I, Repercussions for Nonperformance at 

II-32

 2008 Moyer Program Guidelines, Part III, Repercussions for Nonperformance at 

36

 2011 Moyer Program Guidelines, Part I, Repercussions for Nonperformance at 

3-44

Provisions in this section of the 2011 Moyer Program Guidelines specify some of the 

actions that would constitute a breach of contract as well as penalties and appropriate 

corrective actions for non-performance, including cancellation of the contract and 

recovery of all or a portion of Moyer Program funds. The 2005 and 2008 Moyer 

Program Guidelines do not specify repercussions for noncompliance but state that the 

contracts must include these types of stipulations.

Pre- and post-inspections are also required for funded projects, further ensuring the 

emission reductions are verifiable. This requirement ensures information provided by 

the project owner is consistent with actual operating equipment and that the existing 

equipment is in working condition. Additional requirements for pre-inspections including 

verification of usage and requirements for photographic confirmation of the equipment 

are in:

 2005 Moyer Program Guidelines, Part I, Pre-Inspection at II-35

 2008 Moyer Program Guidelines, Part III, Pre-Inspection at 37

 2011 Moyer Program Guidelines, Part I, Pre-Inspection at 3-38

Additional requirements for post-inspections including photographic confirmation of the 

new equipment are in:

 2005 Moyer Program Guidelines, Part I, Post-Inspection at II-35

 2008 Moyer Program Guidelines, Part III, Post-Inspection at 39

 2011 Moyer Program Guidelines, Part I, Post-Inspection at 3-38

In general, the application, contracting, and inspection requirements are sufficient to 

ensure that projects funded following Moyer Program Guidelines are independently 

verifiable and enforceable by ARB and the District. Additional requirements specific to 

each project type and how they help ensure the integrity criteria for enforceability when 

combined with the requirements discussed in this section are discussed later.

General Moyer Program Quantifiable

Appendix C of the 2005, 2008, and 2011 Moyer Program Guidelines contains the 

formulas used to determine annual emissions and annual emission reductions based on 
September 22, 2014 8

activity data, including options for using hours of operation, fuel consumption and miles 

traveled to determine annual usage. In general emission reductions are calculated by 

taking the difference between the emissions of a baseline technology and a reduced 

technology. The baseline technology is an engine certified by ARB to the current 

emission standards for new purchases or the existing engine in a vehicle or equipment

for repowers, replacements and retrofits. The reduced technology is generally one of 

the following:

 For a new purchase, the reduced technology is an engine certified by ARB to 

reduce NOx emissions by at least 30 percent less than the current NOx emission

standard, or certified by ARB to the optional NOx or NOx + NMHC emission 

standard.

 For a repower, the reduced technology is the replacement engine certified by 

ARB to at least 15 percent less than the NOx emissions from the baseline 

technology.

 For a NOx retrofit, the reduced technology is an ARB-verified retrofit technology 

that reduced NOx emissions by at least 15 percent from the NOx emissions of 

the baseline technology.

 For a PM retrofit, the reduced technology is the ARB-verified diesel emission 

control strategy that reduced PM emissions to the appropriate level depending on 

the specific project types.

The following sections of the Moyer Program Guidelines have tables containing data 

needed to calculate the emission reductions of projects using formulas in Appendix C:

 2005 and 2008 Program Moyer Guidelines, Part IV, Tables for Emission 

Reduction and Cost-Effectiveness Calculations at B-1

 2011 Moyer Program Guidelines, Part 1, Tables for Emission Reduction and 

Cost-Effectiveness Calculations at D-1

Included are data such as engine emission factors, load factors, and other conversion 

factors used in the calculations described in Appendix C. Along with activity data 

required to be reported by the Moyer Program Guideline sections discussed above in 

the “General Moyer Program Enforceable” section, these appendices allow for the 

quantification of emissions and emission reductions. Appendix B of the 2005 Moyer 

Program Guidelines states that “the emission factors in the tables reflect preliminary 

data on emission rates developed by ARB staff as part of a comprehensive effort to 

update the emissions models used for on-road motor vehicle and off-road mobile 

sources.” This Appendix also clarifies that the draft data were made available on ARB’s 

website in early 2005, but were subject to change as staff completed their analyses. 

See 2005 Moyer Program Guidelines, Part IV, Appendix B at B-1. Some of the specific 

project guidelines for the 2008 and 2011 Moyer Program Guidelines indicate the source 

of the data in the Tables in Appendix B and D, respectively, and will be discussed below 

when specified. Additional requirements specific to each project type and how they help 

ensure the reductions are quantifiable when combined with the requirements discussed 

in the section are addressed later.
September 22, 2014 9

General Moyer Program Surplus

Emission reductions are surplus if they are not required by other regulations or legal 

mandates. The Moyer Program Guidelines specify that emission reductions cannot be 

required by any federal, State, or local regulations, memorandum of 

agreement/understanding, settlement agreement, mitigation requirements, or other legal 

mandate in order for the project to be funded. See:

 2005 Moyer Program Guidelines, Part I, Section VIII.D at II-31

 2008 Moyer Program Guidelines, Part III, Section (a) at II-1

 2011 Moyer Program Guidelines, Part I, Section A at 2-1

The 2008 and 2011 Moyer Program Guidelines also state that “rule approval date (or 

the promulgation date of a federal regulation) represents the cutoff date by which a 

Moyer Program project contract must be fully executed, without needing to consider the 

rule in evaluating the surplus nature of the project emission reductions. After that date, 

the new rule must be considered in the evaluation of a project’s eligibility.” See 2008 

Moyer Program Guidelines, Part I, Section (b) at II-1 and 2011 Moyer Program 

Guidelines, Part 1, Section B at 2-1.

Recordkeeping and reporting requirements described above in the “General Moyer 

Program Enforceable” and “General Moyer Program Quantifiable” sections ensure that 

historic and current emission estimates correctly represent emissions occurring in the 

San Joaquin Valley. Pre-inspection requirements described in the “General Moyer 

Program Enforceable” section ensure that the unit to be replaced is still in useable form 

and thus would not have been replaced by normal fleet turnover. These requirements 

ensure that emission reductions from normal fleet turnover are not treated as surplus.

Additional requirements specific to each project type and how they ensure the integrity 

criteria for surplus when combined with the requirements discussed in this section are

discussed later.

General Moyer Program Permanent

The Moyer Program requires that the old engine be destroyed and that the destruction 

is verified to ensure old equipment is not reused and that the emission reductions are 

permanent. See 2005 Moyer Program guidelines, Part I, Section IX.B at II-36; 2008 

Moyer Program Guidelines, Part III, Section 31(c) at 41; and 2011 Moyer Program 

guidelines, Part 1, Section BB at 3-38.

The Moyer Program Guidelines also require that each contract executed with a grantee 

identify a “contract term” which must include two time frames as discussed in the 

“General Moyer Program Enforceable” section - “project completion” and “project 

implementation”- to ensure that the District and ARB can fully enforce the contract 

during the life of the Moyer Program-funded project.

 2005 Moyer Program Guidelines, Part I, Contract Term at II-29

 2008 Moyer Program Guidelines, Part III, Contract Term at 35
September 22, 2014 10

 2011 Moyer Program Guidelines, Part I, Contract Term at 3-32

These sections specify that the contract must include language stating that the grantee 

is required to operate and maintain their funded projects, be it the repowered engines, 

the equipment retrofit or the new engine, for the full project implementation period 

ensuring that the emission reductions quantified are occurring throughout the project life. 

These contract provisions enable U.S. EPA and the public to evaluate the duration for 

which ARB attributes emission reductions to a particular project and to determine 

whether that duration adequately covers the period for which the reductions are relied 

upon in a SIP.

Additional requirements specific to each project type and how they help ensure the 

permanence of the emission reductions when combined with the requirements 

discussed in this section are discussed later.

B. Moyer Program Off-Road Equipment: Repower, Replacement or 

Retrofit

Applicable guidelines: 

 2005 Moyer Program Guidelines, Part II, Chapter 5, Compression-Ignition OffRoad Equipment

 2008 Moyer Program Guidelines, Part I, Chapter 5, Off-Road CompressionIgnition Equipment

 2011 Moyer Program Guidelines, Part 1, Chapter 7, Off-Road CompressionIgnition Equipment

Duration of Emission Reductions: Emission reductions must span the entire 2014 

calendar year.

Background:

The project types include off-road equipment construction repower and retrofit along 

with off-road equipment mobile agricultural repower, replacement, and retrofit.

Moyer Program Off-Road Equipment Repower, Replacement, and Retrofit Enforceable

Chapter 5 of the 2005 Moyer Program Guidelines states that the “contract term must 

extend to the end of the project life.” See 2005 Moyer Program Guidelines, Part II, 

Section V.A. at V-9. In addition, Table 5-3 contains all information that the applicant 

must submit in a project application to be eligible for funding. The required information 

includes information about the baseline and replacement technologies, information 

about the vehicle activity and information about the applicant. This chapter also 

requires a functioning hour meter to support equipment activity data included in the 

application. See 2005 Moyer Program Guidelines, Part II, Section VI page V-13.

Chapter 5 of the 2008 guidelines, which covers the repower and retrofit projects, 

requires historical hours of operation be based on the average of the two previous years’

use or that two years of historical fuel usage documentation be used to determine 
September 22, 2014 11

historical fuel usage for calculations based on fuel. See 2008 Moyer Program 

Guidelines, Part I, Section IV. (a)(4) at V-3. Chapter 5 also requires that “future annual 

hours of equipment operation for determining emission reductions must be based only 

on readings from an installed and fully operational hour meter.” See 2008 Moyer 

Program Guidelines, Part I, Section IV.(a)(5) at V-3.

Chapter 7 of the 2011 Moyer Program Guidelines which covers repower and retrofit 

projects, also requires that project emission reductions be based upon readings from an 

installed and fully operational hour meter, or alternatively, if fuel usage is used, then 

future annual fuel usage must be based on fuel logs, purchase receipts, or ledger 

entries specific to the funded equipment. See 2011 Moyer Program Guidelines, Part I, 

Section D.1.(I) at 7-6.

Chapter 9 of the 2011 Moyer Program Guidelines covers the repowers of off-road 

compression ignition projects, also requires that the grantee demonstrate that it owned 

and operated the old equipment in California for the previous two years (see 

2011 Moyer Program Guidelines, Part I, Section C.2(E) at 9-4). To verify the usage of 

the new equipment, the Moyer Program Guidelines require that new replacement 

equipment have an installed and fully operational hour meter or that fuel logs or 

purchase receipts of fuel be kept. See 2011 Moyer Program Guidelines, Part I, Section 

C.3.(I) at 9-9.

The requirement in the “General Moyer Program Enforceable” section above, along with 

the requirements that activity be reported, to different degrees depending on the 

guideline year as described above for the 2005, 2008, and 2011 Moyer Program 

Guidelines, help ensure the integrity criterion for enforceability for projects funded under 

these guidelines.

Moyer Program Off-Road Equipment Repower, Replacement, and Retrofit Quantifiable

Tables B-12 and B-13 in Appendix B of the 2005 Moyer Program Guidelines have the 

emission and load factors necessary to calculate the emission reductions using the 

equations in Appendix C. According to Chapter 5 of the 2005 Moyer Program 

Guidelines, the emission factors “reflect preliminary emission data based on model input 

values to the OFFROAD emission inventory model for engines greater than or equal to 

25 hp.” See 2005 Moyer Program Guidelines, Part II, Section VI at V-13.

Tables B-11 through B-13 in Appendix B of the 2008 Moyer Program Guidelines have 

the necessary emission and load factors to calculate the emission reductions using the 

equations in Appendix C. 

Tables D-10 through D-12 in Appendix D of the 2011 Moyer Program Guidelines have 

the necessary emission and load factors to calculate the emission reductions using the 

equations in Appendix C. The certification emission standards and Tier designation for 

the engine used to calculate emission reductions must be determined from engine 
September 22, 2014 12

emission standards adopted by ARB and U.S. EPA through a public process. See 2011 

Moyer Program Guidelines, Part 1, Section D.1.(C) at 7-5.

All three guidelines require documented activity levels be used along with the above 

discussed data and equations to calculate the emission reductions as discussed in the 

“Moyer Program Off-Road Equipment Repower, Replacement, and Retrofit Enforceable” 

section.

The information discussed in the section, along with that discussed in the “General 

Moyer Program Quantifiable” section provide for well-established, publicly available 

emission factors and calculation methods and require that grantees record and annually 

report activity data to the District. The 2005, 2008, and 2011 Moyer Program 

Guidelines ensure that emission reductions from Off-Road Compression-Ignition 

projects funded through these guidelines can be determined using reliable and 

replicable methods. The provisions are adequate to meet the criterion for emissions 

reductions to be “quantifiable” as defined by U.S. EPA guidance.

Moyer Program Off-Road Equipment Repower, Replacement, and Retrofit Surplus

Chapter 5 of the 2005 Moyer Program Guidelines specify that emission reductions 

generated through projects may not be required by any federal, State, or local 

regulation, memorandum of agreement/understanding with a regulatory agency, 

settlement agreement, mitigation requirement, or other legal mandate. See 2005 Moyer 

Program Guidelines, Part II, Section V.A at V-8. Table 5-2 includes the federal and 

California emission standards that would preclude engines from being surplus if they 

are subject to these.

Section III of Chapter 5 of the 2008 Moyer Program Guidelines lists regulations and 

emission standards that were in place at the time of guideline adoption which would 

preclude engines from being surplus if the engines are subject to these regulations. 

See 2008 Moyer Program Guidelines, Part I, Section II at V-2.

For replacement projects, the 2008 Moyer Program Guidelines require that the 

replacement equipment be functionally equivalent to replaced equipment to help ensure 

that new equipment is surplus. For projects that replace two or more pieces of old, like 

equipment with one piece of replacement equipment, the 2008 Moyer Program 

Guidelines require that the replacement equipment must execute the same job as the 

old pieces of equipment. For baseline emissions in this scenario, the annual emissions 

of the two pieces of old equipment are summed. See 2008 Moyer Program Guidelines, 

Part I, Section IV.(b)(5) at VII-6. Additionally, the 2008 Moyer Program Guidelines 

require that replacement equipment serve the same function and perform the same 

work equivalent to the old equipment (see 2008 Moyer Program Guidelines, Part I, 

Section IV.(c)(2) at VII-7) and the horsepower (hp) rating for the replacement equipment 

engine not be greater than 125 percent of the baseline horsepower for the old 

equipment engine (see 2008 Moyer Program Guidelines, Part I, Section IV.(c)(4) at 

VII-7).
September 22, 2014 13

Chapter 7 of the 2011 Moyer Program Guidelines mandates that emission reductions 

achieved from funded projects cannot count towards a fleet’s regulatory requirements 

for the duration of the project life. See 2011 Moyer Program Guidelines, Part I, Section 

E.2 at 7-10. If subject to this regulation, the guidelines require that the grantee submit 

data to determine if old equipment or equipment to be repowered is in compliance with 

the Off-Road In-Use regulations reporting system. See 2011 Moyer Program 

Guidelines, Part I, Section E.1 at 7-10. Additionally, Sections E.4 through E.6 specify 

years through which funding is available based on the compliance deadline in the 

In-Use Off-Road Diesel Regulation.

Similarly to the 2008 Moyer Program Guidelines, Chapter 9 of the 2011 Moyer Program 

Guidelines requires that the replacement equipment is functionally equivalent to new 

equipment to help ensure that new equipment is surplus. The guidelines require that 

replacement equipment serve the same function and perform the same work as the old 

equipment (see 2011 Moyer Program Guidelines, Part I, Section C.3.(B) at 9-7) and 

documentation must be provided to verify this (see 2011 Moyer Program Guidelines, 

Part I, Section C.3.(D) at 9-7). Additionally, the guidelines require that the horsepower 

rating for the replacement engine not be greater than 125 percent of the original 

manufacturer rated hp (baseline hp) for the old (existing) equipment engine (see 

2011 Moyer Program Guidelines, Part I, Section C.3.(D) at 9-7). These requirements 

are designed to ensure that the new equipment is replacing an existing 

(higher-polluting) piece of equipment that is currently being used, instead of expanding 

a fleet.

For projects subject to the ARB In-Use Off-Road Road Diesel Regulation, Chapter 9 

specifies that “no emission reductions achieved from a funded program can count 

towards a fleet’s regulation requirements for the duration of the project life.” See Moyer 

Program Guidelines, Part 1, Section C.7.(C) at 9-16. If subject to this regulation, the 

guidelines require that the grantee submit data to determine if old equipment or 

equipment to be repowered is registered in the Off-Road In-Use Regulation reporting 

system. See 2011 Moyer Program Guidelines, Part 1, Section C.2.(D) at 9-4. 

Additionally, Sections C.7.(E) through C.7.(G) specify years through which funding is 

available based on the compliance deadline in the In-Use Off-Road Diesel Regulation.

The requirements discussed in the section, along with that discussed in the “General 

Moyer Program Surplus” help ensure the integrity criterion for surplus for projects 

funded under these guidelines.

Moyer Program Off-Road Equipment Repower, Replacement, and Retrofit Permanent

Chapter 5 of the 2008 Moyer Program Guidelines requires that engines replaced as part 

of an off-road repower be destroyed. See 2008 Moyer Program Guidelines, Part I, 

Section IV.(a)(11) at V-8. Chapter 7 of the 2008 Moyer Program Guidelines requires 

that old equipment be destroyed within 60 days of being replaced and that the District 
September 22, 2014 14

do a salvage inspection. See 2008 Moyer Program Guidelines, Part I, Section D.4.(C) 

at 9-11.

Similarly to the 2008 Moyer Program Guidelines, Chapter 7 of the 2011 Moyer Program 

Guidelines requires that engines replaced as part of an off-road repower project be 

destroyed and rendered useless. See 2011 Moyer Program Guidelines, Part I, Section 

D.2.(I) at 7-9. Also following the requirements of the 2008 Moyer Program Guidelines, 

Chapter 9 of the 2011 Moyer Program Guidelines requires that the old equipment be 

destroyed within 60 days of being replaced. See 2011 Moyer Program Guidelines, Part 

I, Section D.4.(C) at 9-11.

Recordkeeping and reporting requirements for the replacement projects discussed in 

the “Moyer Program Off-Road Equipment Repower, Replacement, and Retrofit 

Enforceable” section above (e.g., the requirement that the grantee demonstrate that it 

owned and operated the old equipment in California for the previous two years) provide 

further documentation of the emission reductions from an off-road compression ignition 

replacement project.

The requirements discussed in the “General Moyer Program Permanent” section above 

is sufficient to help ensure that the emission reductions generated through Off-Road 

Equipment Repower, Replacement and Retrofit projects funded under the 2005, 2008,

and 2011 Moyer Program Guidelines are “permanent” as defined by U.S. EPA guidance.

Conclusion: Relevant portions of 2008 and 2011 Moyer Program Guidelines establish 

clear criteria that enable ARB to: (1) quantify the emission reductions attributed to 

specific projects with a reasonable level of accuracy; (2) verify that those emission 

reductions are “surplus” to federal/State requirements and other legal mandates; 

(3) enforce the conditions of program grants to ensure that contracted emission 

reductions are achieved; and (4) monitor the continuing implementation of program 

grants to ensure that emission reductions are “permanent” throughout the life of each 

project. 

C. Moyer Program Portable and Stationary Agricultural Source 

Repower Projects

Applicable guidelines:

 2005 Moyer Program Guidelines, Part II, Chapter 10, Agricultural Sources

 2008 Moyer Program Guidelines, Part I, Chapter 10, Agricultural Sources

 2011 Moyer Program Guidelines, Part I, Chapter 10, Portable and Stationary 

Agricultural Sources

Duration of Emission Reductions: Emission reductions must span the entire 2014 

calendar year.

Background:

The project types include stationary and portable agricultural engine repowers.
September 22, 2014 15

Moyer Program Portable and Stationary Agricultural Sources Repower Enforceable

ARB requires the use of an hour-based formula for Portable and Stationary Agricultural 

Sources Repower projects; a fuel-based formula can be used if two years of historical 

fuel logs or purchase receipt documentation are provided by the grantee. See 2008 

Moyer Program Guidelines, Part I, Section IV.(a).(8) at X-5, 2011 Moyer Program 

Guidelines, Part 1, Section C.1.(E) at 10-3. To verify the usage of the new equipment, 

the guidelines require that future annual hours of equipment operation for determining 

emission reductions be based on an installed and fully operational hour meter or that 

fuel logs or purchase receipts of fuel be kept. See 2005 Moyer Program Guidelines, 

Part II, Section VII.B at X-15, 2008 Moyer Program Guidelines, Part I, Section IV.(a)(9) 

at X-5, 2011 Moyer Program Guidelines, Part I, Section C.1.(F) at 10-3.

ARB requires that engines be certified (see 2005 Moyer Program Guidelines, Part II, 

Section IV.B.2 at X-6, 2008 Moyer Program Guidelines, Part I, Section IV.(a)(4) at X-5 

and 2011 Moyer Program Guidelines, Part 1, Section C.1.(G-I) at 10-4). The guidelines 

clearly define alternative documentation and testing requirements when certification is 

unavailable. See 2005 Moyer Program Guidelines, Part II, Section V.C at X-11, 2008 

Moyer Program Guidelines, Part I, Section IV.(b).(12) at X-7, 2011 Moyer Program 

Guidelines, Part 1, Section C.2.(I-K) at 10-6.

The requirements discussed in the “General Carl Moyer Enforceable” section along with 

the specific requirements discussed above, help ensure the integrity criterion for 

enforceability of Portable and Stationary Agricultural Sources Repower projects funded 

under the 2005, 2008, and 2011 Moyer Program Guidelines.

Moyer Program Portable and Stationary Agricultural Sources Repower Quantifiable

As discussed in the “General Moyer Program Quantifiable” section, the following 

appendices to the Moyer Program Guidelines provide the methodology for calculating 

emission reductions from Portable and Stationary Agricultural Sources Repower 

projects, using hours of operation or fuel consumption as activity factors: Appendix C 

(2005, 2008, and 2011 Moyer Program Guidelines), Appendix B (2005 and 2008 Moyer 

Program Guidelines), and Appendix D (2011 Moyer Program Guidelines). Along with 

the usage data discussed in the “General Moyer Program Enforceable” section and the 

recordkeeping requirements discussed in the “Moyer Program Portable and Stationary 

Agricultural Sources Repower Enforceable” section above, these appendices allow for 

the reliable and replicable quantification of emission reductions.

Moyer Program Portable and Stationary Agricultural Sources Repower Surplus

Most Portable and Stationary Agricultural Sources Repower projects are subject to 

regulation under the Stationary Engine Airborne Toxic Control Measure (ATCM), the 

Portable Engine ATCM, or District Rule 4702. As described in “General Moyer Program 

Surplus” section, regulated engines are not eligible for funding (also see 2008 Moyer 
September 22, 2014 16

Program Guidelines, Part I, Table 10-1 at X-1 and Section III at X-3 and 2011 Moyer 

Program Guidelines, Part 1, Section C.1.(C) at 10-3. The 2008 and 2011 Moyer 

Program Guidelines “Fleet Rule Implementation Charts for use with the (2008) 2011 

Moyer Program Guidelines” (Implementation Chart) document details the appropriate 

project lifetimes based on compliance deadlines by project type and year.

For projects where an existing engine is replaced by a natural gas engine or electric 

motor, the project life can extend beyond a compliance date. In this case the 

quantification protocol ensures that only surplus emission reductions are calculated. 

The Implementation Chart document specifies that the existing engine emissions should 

be used as a baseline until the compliance deadline. After which, the required Tier 

emission rate should be used as the baseline for the remainder of the project life.

The 2011 Moyer Program Guidelines, Part 1, Section C.1.(C)(2) at 10-3 states that in 

accordance with SBX2 3, portable farm equipment may be eligible for funding up to the 

compliance date on an applicable in-use rule and for up to a ten year project life. These 

projects are considered surplus until the compliance date.

The requirements in the “General Moyer Program Surplus” section, along with the 

specific requirements detailed above ensure the surplus nature of emission reductions 

achieved for Portable and Stationary Agricultural Sources Repower projects funded 

under the 2005, 2008, and 2011 Moyer Program Guidelines.

Moyer Program Portable and Stationary Agricultural Sources Repower Permanent

The following sections require that all engines replaced as part of a Portable and 

Stationary Agricultural Sources Repower project be destroyed consistent with the 

provisions discussed in the “General Moyer Program Permanent” section: 2005 Moyer 

Program Guidelines, Part II, Section V.E at X-3, 2008 Moyer Program Guidelines, Part I, 

Section IV.(b).13 at X-7, and 2011 Moyer Program guidelines, Part I, Section C.2.(L) at 

10-8. In combination with contracting requirements discussed in the “General Moyer 

Program Permanent” section and the record keeping requirements in the “General 

Moyer Program Enforceable” section, these requirements ensure that emission 

reductions for Portable and Stationary Agricultural Sources Repower projects funded 

under the 2005, 2008, and 2011 Moyer Program Guidelines are permanent for the 

duration of the project life.

Conclusion: Relevant portions of 2005, 2008, and 2011 Moyer Program Guidelines 

establish clear criteria that enable the ARB to: (1) quantify the emission reductions 

attributed to specific projects with a reasonable level of accuracy; (2) verify that those 

emission reductions are “surplus” to federal/State requirements and other legal 

mandates; (3) enforce the conditions of program grants to ensure that contracted 

emission reductions are achieved; and (4) monitor the continuing implementation of 

program grants to ensure that emission reductions are “permanent” throughout the life 

of each project. 
September 22, 2014 17

D. Prop 1B On-Road Vehicle Replacement Projects

Applicable guidelines: 

 Proposition 1B: Goods Movement Emission Reduction Program Final 2008 

Guidelines for Implementation, Adopted February 28, 2008

 Proposition 1B: Goods Movement Emission Reduction Program Final 2010 

Guidelines for Implementation, adopted March 25, 2010 

Duration of Emission Reductions: Emission reductions must span the entire 2014 

calendar year. 

Background:

California voters approved Proposition 1B in November 2006, authorizing the 

Legislature to appropriate $1 billion in bond funding to ARB to reduce air pollution 

emissions and health risks from freight movement along California’s priority trade 

corridors. See “Proposition 1B Program: Goods Movement Emission Reduction 

Program, Final 2013 Guidelines for Implementation,” adopted January 25, 2013. The 

legislation that created the Program is codified in the California Health and Safety Code, 

section 39625 et seq. 

By statute, Prop 1B can only fund emission reductions not otherwise required by law or 

regulation. ARB awards grants following the program guidelines to fund projects 

proposed by local agencies, including the District, that are involved in freight movement 

or air quality improvements associated with goods movement activities. ARB staff 

developed the initial Proposition 1B: Goods Movement Emission Reduction Program 

Guidelines for Implementation (Prop 1B Guidelines) in consultation with stakeholders, 

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

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

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

and airports. 

When the Board adopted the initial Prop 1B Guidelines in 2008, the Board directed ARB 

staff to reassess those Prop 1B Guidelines following each appropriation of funding. 

Updates to the Prop 1B Guidelines are based on evaluating advances in technology, 

changes in equipment costs, regulatory actions, demand for Prop 1B funds, and other 

new information that influences the design of project specifications. The process 

involves the release of a concept paper and workshops to obtain feedback from 

stakeholders. 

Prop 1B On-Road Vehicle Replacement Project Enforceable

2008 Prop 1B Program Guidelines specify requirements that each implementing District 

must comply with (e.g., pre-project and post-project inspections) and requirements that 

each grantee must be subject to (i.e., contract provisions including monitoring, 

recordkeeping, reporting requirements, and State/District enforcement provisions). See
September 22, 2014 18

2008 Prop 1B Guidelines, Chapter II.D.10 (Local Agency Project Grant Agreement), 

Chapter III.D.8 (Equipment Project Pre-inspection), Chapter III.D.10 (Equipment Project 

Contracts), Chapter IV.G (Equipment Project Non-Performance), and Appendices A and 

B (Recordkeeping and Reporting Requirements). For future emission reduction 

projections, a SIP must contain an enforceable State/District commitment to: (1) monitor, 

assess, and report on emission reductions achieved, and (2) adopt and submit 

substitute measures by a specific date, no later than the applicable Clean Air Act

implementation deadline, if projected emission reductions don’t occur.

Specific funding criteria established in the Prop 1B Guidelines ensure that emission 

reductions claimed for these projects will be independently verifiable and practicably 

enforceable consistent with U.S. EPA policy. The Board holds a noticed public hearing 

to consider recommendations for funding local agency projects. The Board’s funding 

decisions become legally enforceable by ARB through executed grant agreements 

between ARB and the selected local agencies. The requirements for these grant 

agreements are in: 

 Chapter II.D.10, Local Agency Project Grant Agreement, of the 2008 Prop 1B 

Guidelines

 Chapter II.E.10, Local Agency Grant Agreement, of the 2010 Prop 1B Guidelines

These chapters include requirements that the local agency complete equipment project 

pre-inspections and post-inspections. This requirement ensures that equipment 

information provided by the project owner is consistent with actual operating equipment 

and that the existing equipment is in working condition. Additional requirements for 

pre-inspections including verification of usage and requirements for photographic 

confirmation of the equipment are in:

 Chapter III.D.8, Equipment Project Contracts, of the 2008 Prop 1B Guidelines

 Chapter IV.A.10, Equipment Project Pre-Inspections, of the 2010 Prop 1B 

Guidelines

 Chapter III.D.14, Equipment Project Post Inspection, of the 2008 Prop 1B 

Guidelines

 Chapter IV.A.16, Equipment Project Post-Inspections, of the 2010 Prop 1B 

Guidelines

Prop 1B funding is obligated by the District for each project by contracts between the 

District and the equipment owner. The requirements for these contracts, which are 

legally enforceable by the District, are in: 

 Chapter III.D.10, Equipment Project Contracts, of the 2008 Prop 1B Guidelines

 Chapter IV.A.11, Equipment Project Contracts, of the 2010 Prop 1B Guidelines

These sections of the Prop 1B Guidelines include general requirements for 

recordkeeping, reporting, audits, and other verification mechanisms that all project 

contracts must contain, including provisions requiring equipment owners to agree to the 

installation and use of an electronic monitoring device at any time during the contract 

term. Contract non-performance provisions per these sections of the Prop 1B 

Guidelines specify some of the actions that would constitute a breach of contract as well 
September 22, 2014 19

as remedies for non-performance, including cancellation of the contract and recovery of 

all or a portion of program funds. 

Additional requirements specific to truck replacements are in: 

 2008 Prop 1B Guidelines, Appendix A, Trucks Serving Ports and Intermodal Rail 

Yards, and Appendix B, Other Heavy Duty Diesel Trucks, Section C, 

Recordkeeping Requirements, Section D, Annual Reporting Requirements, and 

Section E, Ongoing Evaluation and Audits. 

 2010 Prop 1B Guidelines, Appendix A, Heavy Duty Diesel Trucks, Section E, 

Post-Inspection, Section F, Recordkeeping Requirements, and Section G, 

Annual Reporting Requirements. 

Annual reporting requirements for heavy duty diesel replacement projects in these 

portions of the Prop 1B Guidelines include but are not limited to: 

 Current odometer reading, including the date read. 

 Certification of annual California vehicle miles travelled (VMT) since last report. 

 Certification of the required percent operation in California. 

 Certification of at least 50 percent of travel within the four California trade 

corridors as well as the percentage of annual VMT in the Central Valley trade 

corridor. 

Finally, failure to comply with the terms of a project contract may result in: 

 Recovery of all or a portion of program funds. 

 Other fiscal penalties on equipment owners based on the severity of the 

nonperformance. 

 Cancellation of the contract. 

 A ban on the equipment owner’s ability to participate in future State incentive 

programs. 

Non-performance requirements prohibiting a specific piece of equipment from 

participating in another State incentive program are found in: 

 Chapter IV.G, Equipment Project Non-Performance, 2008 Prop 1B Guidelines

 Chapter VI.I, Equipment Project Non-Performance, 2010 Prop 1B Guidelines

These criteria for on-road vehicle replacement projects funded through the 2008 and 

2010 Prop 1B Guidelines ensure that actions required of grantees are independently 

verifiable; program violations are defined; those liable can be identified; and the District 

may apply penalties and secure appropriate corrective action where applicable. 

Additionally, the public and U.S. EPA will have access to all emissions-related 

information obtained from the sources. These provisions adequately meet the 

enforceability criterion as defined in U.S. EPA guidance. 

Prop 1B On-Road Vehicle Replacement Project Quantifiable

2008 Prop 1B Program Guidelines require the use of well-established, publicly available 

emission factors and calculation methods – i.e., emission reduction “quantification 
September 22, 2014 20

protocols.” See 2008 Prop 1B guidelines, Chapter II.C.2.b (Project Benefits Calculator) 

and associated “directions document,” available at 

http://www.arb.ca.gov/bonds/gmbond/docs/prop_1b_goods_movement_2008-09_calcul

ator_directions.pdf. 

The Prop 1B Program Guidelines direct ARB staff to develop and make publicly 

available a “Project Benefits Calculator” to determine the emission reductions achieved 

by funded projects. See 2008 and 2010 Prop 1B Guidelines, Chapter II.C.2.b, Project 

Benefits Calculator. According to the “directions” document for this Project Benefits 

Calculator (“Directions Document”), emission factors for diesel heavy-duty trucks are 

based on in-use testing of Class 7 and Class 8 diesel trucks. See Directions Document 

at p. 7. The emission factors are the same ones used for the California On-Road 

Heavy-Duty Diesel Vehicles (In-Use) Regulation and used in EMFAC2011, which 

U.S. EPA has approved for use in California SIPs and transportation conformity 

demonstrations (78 FR 14533, March 6, 2013). The publicly available Project Benefits 

Calculator uses vehicle miles traveled, which must be recorded and reported as 

explained above in the “Prop 1B Enforceable” section, together with emission factors 

obtained from the On-Road Heavy-Duty Diesel Vehicles (In-Use) Regulation, to 

determine emissions. See Directions Document at pp. 4-7. Existing vehicle usage is 

based on vehicle activity data for the past two years. See 2008 Prop 1B Guidelines, 

Appendices A and B, Section F, Application Information; 2010 Prop 1B Guidelines, 

Appendix A, Section C, Application Information.

By providing for well-established, publicly available emission factors and calculation 

methods and requiring that grantees record and report activity data to the District on an 

annual basis, the 2008 and 2010 Prop 1B Guidelines ensure that emission reductions 

from on-road vehicle replacement projects funded through these guidelines can be 

determined using reliable and replicable methods. These provisions adequately meet 

the criterion for emission reductions to be “quantifiable,” as defined in U.S. EPA 

guidance. 

Prop 1B On-Road Vehicle Replacement Project Surplus

2008 Prop 1B Program Guidelines prohibit the use of funds for any project required by 

federal, State, or local requirement or other legal mandate. See 2008 Prop 1B 

Guidelines, Chapter III.B.1 (Legal Restrictions). Also, local agency pre-inspection 

requirements ensure that the unit to be replaced is still in useable form and would not 

have been replaced by normal fleet turnover. See 2008 Prop 1B Guidelines, Chapter

II.D.10 (Local Agency Project Grant Agreement), Chapter III.D.8 (Equipment Project 

Pre-inspections). The SIP relies on incentive-based emission reductions during the 

timeframe that is consistent with “project life.” See 2008 Prop 1B Guidelines, Chapter

III.D.10 (Equipment Project Contracts).

Prop 1B Guidelines explicitly state that “local agencies shall certify that the local agency 

project would achieve emission reductions not otherwise required by law or regulation,” 

which means that “the emission reductions are not required pursuant to any local, State, 
September 22, 2014 21

or federal law, rule, or regulation; any requirements imposed by the California 

Environmental Quality Act; or any requirements imposed by a legal instrument such as 

a legal settlement or consent decree (collectively referred to as ‘law or regulation’).” 

See Chapter III.B.1, Legal Restrictions, of the 2008 and 2010 Prop 1B guidelines. 

Recordkeeping, reporting and application requirements described above in the “Prop 1B 

Enforceable” and “Prop 1B Quantifiable” sections ensure that historic and future 

emission estimates correctly represent emissions occurring in the San Joaquin Valley. 

Pre-inspection requirements discussed above in the “Prop 1B Enforceable” section 

ensure that the unit to be replaced is still in useable form and thus would not have been 

replaced by normal fleet turnover. These requirements ensure that emission reductions 

from normal fleet turnover that have already been accounted for in the future baseline 

emission inventories underlying a SIP attainment demonstration are not treated as 

surplus. 

These provisions ensure that emission reductions attributed to On-Road Vehicle 

Replacement projects funded through the Prop 1B 2008 and 2010 Guidelines are not 

required by any existing regulation or other legal mandate and are not accounted for in 

the future baseline inventories underlying a SIP. These provisions adequately meet the 

criterion for emission reductions to be “surplus,” as defined in U.S. EPA guidance. 

Prop 1B On-Road Vehicle Replacement Project Permanent

2008 Prop 1B Program Guidelines specify requirements to (1) demonstrate that both 

the replaced (old) and replacement (new) equipment are used similarly in the 

nonattainment area, and (2) document the destruction of the replaced equipment. Also, 

required contract provisions enable U.S. EPA and the public to identify the timeframe 

during which the State/District attributes emission reductions to a particular project and 

to determine whether that timeframe adequately covers the period for which the 

reductions are relied upon in a SIP. See 2008 Prop 1B Guidelines, Chapter III.D.13 

(Equipment Project Scrap Requirements), Chapter II.D.10 (Local Agency Project Grant 

Agreement), Section III.D.8 (Equipment Project Contracts), and Chapter III.d.10 

(Equipment Project Contracts). 

For Prop 1B truck replacement projects, two key types of requirements ensure that 

emission reductions are “permanent” for the life of the project: (1) requirements to 

demonstrate that both replaced (old) and replacement (new) equipment are used 

similarly in the San Joaquin Valley, and (2) requirements to document the destruction of 

the replaced equipment. The Prop 1B Guidelines require that the local agency ensure 

that old equipment is scrapped. The following sections delineate the procedures that 

must be implemented for all replacement projects, which include specifics of how the 

units shall be destroyed and documentation requirements to demonstrate that the unit 

replaced was destroyed: 
September 22, 2014 22

 Chapter III.D.13, Equipment Project Scrap Requirements, of the 2008 Prop 1B 

Guidelines

 Section IV.A.14, Equipment Project Scrap Requirements, of the 2010 Prop 1B 

Guidelines

Additional scrapping requirements specific to each project option are in Section D, 

Scrap Requirements, of Appendix A of the 2010 Prop 1B Guidelines. The information in 

these tables for the 2010 Prop 1B Guidelines is included in Chapter III.D.13 for the 2008 

Prop 1B Guidelines.

Recordkeeping and reporting requirements discussed in the “Prop 1B Enforceable” 

section above (e.g., requirements to certify that at least 50 percent of travel is within the 

four California trade corridors and to provide the percentage of annual VMT in the 

Central Valley trade corridor) provide further documentation of the emission reductions 

from a Prop 1B truck replacement project which occur in the San Joaquin Valley. 

Finally, both the 2008 and 2010 Prop 1B Guidelines require that each equipment project 

contract identify a “term of contract,” i.e., the project completion time plus the 

“equipment project life.” See 2008 Prop 1B Guideline at Chapter III.D.10 (“Equipment 

project contracts”) and 2010 Prop 1B Guideline at Chapter IV.A.11 (“Equipment project 

contracts”). The term “equipment project life” is defined in both Prop 1B Guidelines as 

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

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

requirements of the Prop 1B Program.” See 2008 and 2010 Prop 1B Guidelines at 

table 1.4 (definitions). These contract provisions enable U.S. EPA and the public to 

evaluate the duration for which the District attributes emission reductions to a particular 

project and to determine whether that duration adequately covers the period for which 

the reductions are relied upon in a SIP. These provisions adequately meet the criterion 

for emission reductions to be “permanent,” as defined in U.S. EPA guidance.

Conclusion: Relevant portions of the 2008 and 2010 Prop 1B guidelines establish clear 

criteria that enable the ARB to: (1) quantify the emission reductions attributed to specific 

projects with a reasonable level of accuracy; (2) verify that those emission reductions 

are “surplus” to federal/State requirements and other legal mandates; (3) enforce the 

conditions of program grants to ensure that contracted emission reductions are 

achieved; and (4) monitor the continuing implementation of program grants to ensure 

that emission reductions are “permanent” throughout the life of each project. 

V. EMISSION REDUCTIONS

Incentive-based emission reduction measures were identified in the SJV PM2.5 Plan as 

one mechanism for fulfilling ARB’s aggregate emissions reduction commitment for 

meeting the 2014 attainment target. This Report documents the quantified emission 

reductions from these ARB and District-administered incentive projects. 

ARB used the Carl Moyer Program Clean Air Reporting Log of Moyer Program projects 

and Goods Movement Online Database of Prop 1B projects to determine the list of 

SIP-creditable projects. These are the official Statewide databases for these programs. 
September 22, 2014 23

Only those projects with a completed post-inspection as of December 31, 2013, and 

that will produce surplus emission reductions through the entire 2014 calendar year 

were included. From these lists, ARB selected a subset of project types described in 

Section IV of this Report:

 Off-road equipment repower, replacement, and retrofit projects using 2005, 

2008, and 2011 Moyer Program Guidelines

 Portable and stationary agricultural source projects using 2005, 2008, and 2011 

Moyer Program Guidelines

 On-road vehicle replacement projects using 2008 and 2011 Prop 1B Guidelines

Contingency emission reductions are required to be held in reserve and cannot be 

counted towards attainment. Therefore, to ensure that the identified projects are 

surplus in this specific context, this preliminary list was then cross-referenced by project 

identification number to the list of projects that were approved for 2015 attainment 

contingency purposes in Attachments A and B in U.S. EPA’s Technical Support 

Document for its Proposed Approval of Clean Air Act Section 172(c)(9) Contingency 

Measures in the San Joaquin valley State Implementation Plan for Attainment of the 

1997 PM2.5 Standards, dated August 15, 2013. These contingency projects were 

originally selected from the list in the District’s 2013 Annual Demonstration Report. All 

projects that appeared in both the preliminary project list and the contingency project list 

were then removed from the list of SIP-eligible projects to be credited. Appendix H 

includes a list of incentive projects with associated emission reductions that follow the 

approved incentive program guidelines, meet U.S. EPA’s integrity elements, and are 

therefore SIP eligible.

The cumulative emission reductions from Moyer Program projects listed in Appendix H

in the San Joaquin Valley are in Table 1. Table 2 contains emission reductions 

achieved with Prop 1B projects listed in Appendix H in the San Joaquin Valley. The 

total emission reductions from the ARB incentive-based emission reduction measures 

for which ARB is requesting U.S. EPA credit towards the 2014 State aggregate 

commitment in the San Joaquin Valley are in Table 3. 
September 22, 2014 24

Table 1: 2014 Moyer Program Emission Reductions Achieved in the San Joaquin 

Valley

Source Category Technology Guideline 

Year

Emission 

Reductions (tpd)

NOx PM2.5

Off-Road Equipment - Construction Repower 2005 0.03 0.00

Off-Road Equipment - Construction Retrofit 2008 0.00 0.00

Off-Road Equipment - Mobile 

Agricultural Replacement 2011 0.21 0.01

Off-Road Equipment - Mobile 

Agricultural Repower 2005 0.13 0.00

Off-Road Equipment - Mobile 

Agricultural Repower 2008 0.13 0.00

Off-Road Equipment - Mobile 

Agricultural Repower 2011 0.12 0.00

Stationary and Portable Agricultural 

Engines Repower 2005 2.68 0.06

Stationary and Portable Agricultural 

Engines Repower 2008 0.13 0.00

Stationary and Portable Agricultural 

Engines Repower 2011 0.02 0.00

TOTAL 3.5 0.1

Totals may not add up due to rounding.

Table 2: 2014 Prop 1B Emission Reductions Achieved in the San Joaquin Valley

Source Category Technology Guideline 

Year

Emission 

Reductions (tpd)

NOx PM2.5

Heavy Duty Diesel Truck Replacement 2010 2.74 0.08

Other Heavy-Duty Diesel Trucks Replacement 2008 1.64 0.06

TOTAL 4.4 0.1

Table 3: Total 2014 Incentive-Based Emission Reductions

Incentive-Based Emission 

Reduction Measure

2014 Emission Reductions (tpd)

NOx PM2.5

Moyer Program 3.5 0.1

Prop 1B 4.4 0.1

TOTAL 7.8 0.2

Totals may not add up due to rounding. 
September 22, 2014 25

VI. RECOMMENDATION

Staff recommends that the Board approve the Report on Reductions Achieved From 

Incentive-Based Emission Reduction Measures in the San Joaquin Valley and direct 

staff to submit it to U.S. EPA for inclusion in the California SIP as the mechanism to 

allow California to receive SIP credit for reductions achieved through these emission 

reduction measures.