2007 -- H 5574

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LC01556

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STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2007

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A N A C T

RELATING TO MOTOR AND OTHER VEHICLES -- DIESEL EMISSIONS RESOLUTION

     

     

     Introduced By: Representatives Ginaitt, Segal, Walsh, Naughton, and Sullivan

     Date Introduced: February 28, 2007

     Referred To: House Environment and Natural Resources

It is enacted by the General Assembly as follows:

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     SECTION 1. Short title and purpose. -- This act shall be known as and may be cited as

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“The Diesel Emissions Reduction Act of 2008.” The general purposes of this act are:

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     (1) minimize human exposure to and health risks from diesel pollution between the

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calendar years 2008 and 2015;

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     (2) reduce health costs, missed school days, lost worker productivity and premature

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mortality linked to exposure to diesel particulate matter (PM), nitrogen oxides (NOx) and other

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diesel pollutants;

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     (3) achieve maximum feasible diesel particulate matter emissions reductions and

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diminished human exposure that is additional to the impact of federal diesel emission rules which

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focus mostly on new engines; and

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     (4) advance the state's climate protection goals and climate action plan by reducing the

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amount of black carbon pollution emitted by diesels.

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     SECTION 2. Title 31 of the General Laws entitled "MOTOR AND OTHER

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VEHICLES" is hereby amended by adding thereto the following chapter:

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     CHAPTER 47.3

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THE DIESEL EMISSIONS REDUCTION ACT

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     31-47.3-1. Legislative findings. -- (a) Diesel emissions, due in large part to their high

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concentrations of particulate matter are associated with severe and multiple health risks to the

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citizens of Rhode Island, including increased risk of cancer, decreased lung function, aggravated

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asthma, heart attacks and premature death.

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     (b) Diesel exhaust also contains nitrogen oxides which contribute to the formation of

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ground-level ozone, or smog. Although less damaging to health that diesel particulate matter,

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ozone may also cause a variety of respiratory problems, including aggravated asthma, decreases

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in lung capacity and increased susceptibility to respiratory illnesses. Rhode Island continues to be

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classified as a "serious-nonattainment area" for ozone.

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     (c) Diesel pollution has been positively linked to increases in the aggravation of asthma.

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Reducing diesel pollution may help to stem the tide of the asthma epidemic in Rhode Island.

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Rhode Island ranks third (3rd) in the U.S. for the worst asthma rates. More than one in ten (10)

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Rhode Islanders have asthma. Rhode Islanders pay about forty-one million dollars ($41,000,000)

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per year in asthma-associated health costs. Asthma is the most common chronic disease in

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children and responsible for the most school absences in Rhode Island.

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     (d) The EPA, recognizing the harmful effects of diesel emissions, issued new fuel and

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engine emission standards that will reduce particulate matter emissions from new engines ninety

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percent (90%) below previous levels. However, these regulations only address new engines, and

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since diesel engines last for decades, existing engines will survive to pollute at yesterday's

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emission standards for decades to come.

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     (e) The same technology that makes ninety percent (90%) reductions in emissions

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possible for new engines can be retrofitted onto existing engines. Around the country, several

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thousand school buses, transit buses, waste collection vehicles, and construction engines have

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been retrofitted with pollution control equipment, dramatically reducing pollution from these

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fleets.

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     (f) Several states and municipalities are adopting comprehensive emission control

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strategies and have dedicated funds to reducing emissions from diesel vehicles and equipment,

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including California, Texas, New Jersey, New York, Connecticut and Massachusetts.

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     (g) The 2005 Diesel Emissions Reduction Act (DERA), in the Federal Energy Act

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authorized two hundred million dollars ($200,000,000) per year for five (5) years to assist states

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in offsetting costs of diesel emission reduction technology. Rhode Island should act now to

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position itself to maximize matching dollars available through this program by establishing a

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Diesel Emission Reduction Program and Diesel Risk Mitigation Fund.

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     31-47.3-2. Use of ultra low sulfur diesel fuel and best available retrofit technology by

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the state. -- (a) For the purposes of this section only, the following terms shall have the following

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meanings:

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     (1) “Best available retrofit technology” means technology, verified by the United States

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Environmental Protection Agency or California air resources board for reducing the emission of

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pollutants that achieves reductions in particulate matter emissions at the highest classification

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level for diesel emission control strategies that is applicable to the particular engine and

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application. Such technology shall in no event result in a net increase in the emission of nitrogen

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oxides.

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     (2) "Heavy duty vehicle" or "vehicle" means any on-road or nonroad vehicle powered by

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diesel fuel and having a gross vehicle weight of greater than fourteen thousand (14,000) pounds.

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     (3) "Ultra low sulfur diesel fuel" means diesel fuel having sulfur content of fifteen

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thousandths percent (.0015%) of sulfur or less.

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     (b) Any diesel powered heavy duty vehicle that is owned by, operated by or on behalf of,

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or leased by or operating under contract to a state agency and state and regional public authority

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shall be powered by ultra low sulfur diesel fuel.

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     (c) Any diesel powered heavy duty vehicle that is owned by, operated by or on behalf of,

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or leased by or operating under a contract to a state agency or state or regional public authority

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with more than half of its governing body appointed by the governor shall utilize best available

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retrofit technology for reducing the emission of pollutants. The director shall promulgate

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regulations for the implementation of this subdivision specifying procedures for compliance

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according to the following schedule:

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     (1) Not less than thirty-three percent (33%) of the vehicles covered by this subdivision

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shall employ best available retrofit technology on or before December 31, 2008.

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     (2) Not less than sixty-six percent (66%) of the vehicles covered by this subdivision shall

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employ best available retrofit technology on or before December 31, 2009.

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     (3) All vehicles covered by this subdivision shall employ best available retrofit

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technology on or before December 31, 2010.

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     (d) This subdivision shall not apply to:

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     (1) any vehicle subject to a lease or public works contract entered into or renewed prior to

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the effective date of this section;

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     (2) vehicles that are specially equipped for emergency response by a state authority,

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office of emergency management, sheriff’s office, police department or fire department, as well

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as timber harvesting equipment such as harvesters, wood chippers, log skidders, and other

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processing equipment used exclusively off highway for timber harvesting and logging purposes,

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and farm equipment;

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     (3) any on-road vehicle sold as “new” in compliance with the US EPA’s 2007 Heavy-

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duty Highway Diesel Standards” promulgated by US EPA and published in the Federal Register

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at 66 Fed. Reg. 5002 on January 18, 2001, or

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     (4) any nonroad vehicle sold as “new” in compliance with the US EPA's Tier 4 Nonroad

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Diesel Standards” promulgated by US EPA and published in the Federal Register at 69 Fed. Reg.

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38958 on June 29, 2004.

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     (e) In addition to other provisions for regulations in this section, the director shall

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promulgate regulations as necessary and appropriate to carry out the provisions of this act

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including, but not limited to, provision of waivers upon written finding by the director that best

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available retrofit technology for reducing the emissions of pollutants as required by subdivision

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(c) of this section is not available for an individual vehicle or class of vehicles.

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     (f) This section shall not apply where federal law precludes the state from imposing the

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requirement of this section.

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     (g) On or before January 1, 2008 and every year thereafter, the director shall report to the

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governor and legislature on the use of ultra low sulfur diesel fuel and the use of the best available

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retrofit technology as required under this section. The information contained in this report shall

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include, but not be limited to, for each state agency and public authority covered by this section:

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     (1) the total number of diesel fuel-powered motor vehicles owned or operated by such

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agency and authority;

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     (2) the number of such motor vehicles that were powered by ultra low sulfur diesel fuel;

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     (3) the total number of diesel fuel-powered motor vehicles owned or operated by such

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agency and authority having a gross vehicle weight rating of more the fourteen thousand (14,000)

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pounds;

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     (4) the number of such vehicles that utilized the best available retrofit technology,

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including a breakdown by motor vehicle model, engine year and the type of technology used for

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each vehicle;

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     (5) the number of such motor vehicles that are equipped with an engine certified to the

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applicable 2007 Unites States Environmental Protection Agency standard for particulate matter as

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set forth in Section 86.007-11 of Title 40 of the Code of Federal Regulations or to any subsequent

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United States Environmental Protection Agency standard for particulate matter that is at least as

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stringent; and

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     (6) all waivers, findings, and renewals of such findings, which, for each waiver, shall

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include, but not be limited to, the quantity of diesel fuel needed to power diesel fuel-powered

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motor vehicles owned or operated by such agency and authority; specific information concerning

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the availability of ultra low sulfur diesel fuel.

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     (h) The department shall, to the extent practicable, coordinate with regions which have

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proposed or adopted heavy duty emission inspection programs to promote regional consistency in

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such programs.

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     (i) Severability. If any clause, sentence, paragraph, section or part of this act shall be

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adjudged by any court of competent jurisdiction to be invalid and after exhaustion of all further

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judicial review, the judgment shall not affect, impair or invalidate the remainder thereof, but

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shall be confined in its operation to the clause, sentence, paragraph, section or part of this act

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directly involved in the controversy in which the judgment shall have been rendered.

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     31-47.3-3. Use of diesel retrofit devices for waste haulers. -- (a) For the purposes of

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this section only, the following terms shall have the following meanings:

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     (1) “Level 2 control” means a verified diesel emission control device that achieves a

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particulate matter (PM) emission reduction of fifty percent (50%) or more compared to

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uncontrolled engine emission levels.

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     (2) “Level 3 control” means a verified diesel emission control device that achieves a

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particulate matter (PM) emission reduction of eighty-five percent (85%) or more compared to

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uncontrolled engine emission levels, or that reduces emissions to less than or equal to one one-

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hundredth (0.01) grams of PM per brake horsepower-hour. Level 3 control includes repowering

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or replacing the existing diesel engine with an engine meeting US EPA’s 2007 Heavy-duty

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Highway Diesel Standards, or in the case of a nonroad engine, an engine meeting the US EPA’s

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Tier 4 Nonroad Diesel Standards.

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     (b) Any diesel powered waste collection and recycling vehicle in model years between

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and including 1994 and 2006 that is owned, leased, or contracted to perform the removal or

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transfer of municipal waste, including residential or commercial waste, or recycling services shall

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utilize level 3 control retrofit technology for reducing the emission of pollutants. As of January 1,

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2012, no waste collection or recycling vehicle in model years between and including 1994 and

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2006 may be permitted to register without proper demonstration of the required level 3 control

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retrofit technology. The director shall promulgate regulations for the implementation of this

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subdivision specifying procedures for compliance according to the following schedule:

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     (1) Not less than twenty-five percent (25%) of the vehicles covered by this subdivision

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shall have level 3 control retrofit technology on or before December 31, 2008.

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     (2) Not less than fifty percent (50%) of the vehicles covered by this subdivision shall

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have level 3 control retrofit technology on or before December 31, 2009.

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     (3) Not less than seventy-five percent (75%) of the vehicles covered by this subdivision

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shall have level 3 control retrofit technology on or before December 31, 2010.

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     (4) All vehicles covered by this subdivision shall have level 3 control retrofit technology

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on or before December 31, 2011.

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     (c) Any diesel powered waste collection and recycling vehicle in model years 1993 and

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earlier that is owned, leased, or contracted to perform the removal or transfer of municipal waste,

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including residential or commercial waste, or recycling services shall utilize level 2 control

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retrofit technology for reducing the emission of pollutants. As of January 1, 2012, no waste

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collection or recycling vehicle in model years 1993 and earlier may be permitted to register

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without proper demonstration of the required level 2 control retrofit technology. The director

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shall promulgate regulations for the implementation of this subdivision specifying procedures for

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compliance according to the following schedule:

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     (1) Not less than twenty-five percent (25%) of the vehicles covered by this subdivision

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shall have level 2 control retrofit technology on or before December 31, 2008.

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     (2) Not less than fifty percent (50%) of the vehicles covered by this subdivision shall

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have level 2 control retrofit technology on or before December 31, 2009.

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     (3) Not less than seventy-five (75%) of the vehicles covered by this subdivision shall

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have level 2 control retrofit technology on or before December 31, 2010.

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     (4) All vehicles covered by this subdivision shall have level 2 control retrofit technology

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on or before December 31, 2011.

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     (d) On or before January 1, 2008 and every year thereafter, the director shall report to the

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governor and legislature on the use of level 3 and level 2 control retrofit technology on waste

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collection and recycling vehicles required under this section. The information contained in this

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report shall include, but not be limited to:

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     (1) the total number of diesel fuel-powered waste collection and recycling vehicles

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covered by this section;

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     (2) the number of such diesel vehicles that were powered by ultra low sulfur diesel fuel;

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     (3) the total number of diesel fuel-powered waste collection and recycling vehicles

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having a gross vehicle weight rating of more the fourteen thousand (14,000) pounds;

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     (4) the number of such vehicles that were between and including model years 1994 and

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2006;

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     (5) the number of such vehicles between and including model years 1994 and 2006 that

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utilized level 3 control retrofit technology, including a breakdown by motor vehicle model,

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engine year and the type of technology used for each vehicle;

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     (6) the number of such vehicles in model years 1993 and earlier;

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     (7) the number of such vehicles in model years 1993 and earlier that utilized level 2

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control retrofit technology, including a breakdown by motor vehicle model, engine year and the

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type of technology used for each vehicle;

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     (8) the number of diesel waste collection and recycling vehicles that are equipped with an

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engine certified to the applicable 2007 Unites States Environmental Protection Agency standard

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for particulate matter as set forth in Section 86.007-11 of Title 40 of the Code of Federal

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Regulations or to any subsequent United States Environmental Protection Agency standard for

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particulate matter that is at least as stringent; and

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     (9) all waivers, findings, and renewals of such findings, which, for each waiver, shall

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include, but not be limited to, the quantity of diesel fuel needed to power diesel fuel-powered

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motor vehicles owned or operated by such agency and authority; specific information concerning

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the availability of ultra low sulfur diesel fuel.

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     (e) Severability. If any clause, sentence, paragraph, section or part of this act shall be

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adjudged by any court of competent jurisdiction to be invalid and after exhaustion of all further

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judicial review, the judgment shall not affect, impair or invalidate the remainder thereof, but

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shall be confined in its operation to the clause, sentence, paragraph, section or part of this act

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directly involved in the controversy in which the judgment shall have been rendered.

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     31-47.3-4. Reducing emissions from school buses. -- (a) Purpose. To reduce health risks

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from diesel particulate matter (DPM) to Rhode Island school children by significantly reducing

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emissions in tailpipe emissions from school buses, and preventing engine emissions from entering

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the passenger cabin of the buses.

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     (b) Requirements for Rhode Island school buses:

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     (i) By September 1, 2008, no school bus with an engine model year 1993 or older may be

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used to transport school children in Rhode Island;

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     (ii) By September 1, 2010, all full-sized school buses transporting children in Rhode

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Island must be retrofitted with a closed crankcase filtration system and either: (A) be equipped

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with a level 1 (>25% PM reduction), level 2 (>50% PM reduction), or level 3 (>85% PM

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reduction) device verified by the US Environmental Protection Agency or the California Air

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Resources Board; or (B) be equipped with an engine of model year 2007 or newer; or (C) Use an

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alternative fuel verified by CARB/EPA to reduce DPM emissions at a level equivalent to

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subsection (B) above.

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     (c) Development of state procurement contracts.

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     (i) The Rhode Island department of administration (DOA) procurement division shall

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develop procurement contracts for: (A) the purchase of new buses compliant with MY2007

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emission standards; (B) tailpipe emission control retrofits suitable for school buses; and (C)

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closed crankcase filtration systems;

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     (ii) All contracts must be made available to municipalities and private school bus

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operators, provided the contractor can demonstrate that the newly purchased school bus, or the

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retrofitted school bus affected by this provision will be in service in Rhode Island for at least four

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(4) years beginning the date of purchase;

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     (iii) Contracts must be available through Rhode Island's DOA's vendor information

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program (RIVIP) website, in a category that clearly identifies the product to municipalities and

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     private school bus operators;

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     (iv) At least one bid must be developed for each CARB emission control device

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verification level: level 1, level 2, and level 3;

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     (v) At least one bid must be developed for a closed crankcase filtration system;

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     (vi) Rhode Island DEM and DOA shall develop an outreach plan and materials for

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educating school districts and bus companies about the new requirements and paths to

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compliance.

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     (d) State financial assistance to defray compliance costs:

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     (i) Notwithstanding any other provisions of the general laws, purchases of new school

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buses for use in Rhode Island, natural gas or diesel, of model years 2007-2010 are exempt from

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sales tax. The tax exemption provided in this subdivision shall expire on September 1, 2010;

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     (ii) Effective immediately, for school bus model years 1994-2005 only, the state shall

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provide incentive funding to school bus owners for the purchase and installation of any

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CARB/EPA-verified emission control retrofit device together with the purchase and installation

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of closed crankcase filtration system (CCFS) retrofit device. In 2007, the per-unit incentive shall

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not exceed one thousand and five hundred dollars ($1,500) for a level 1 device plus a CCFS or

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two thousand five hundred dollars ($2,500) for a level 2 or level 3 device plus a CCFS. Incentive

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levels may be reevaluated annually, with the goal of maintaining competition in the market for

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retrofit devices;

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     (iv) To receive incentive funding from the state, school bus owners must submit a form to

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the authorized state agency containing the bus model and year, engine model and year, VIN

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number, receipt for the retrofit device, and date installed for every eligible bus. Bus owners must

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also certify that newly purchased or retrofitted buses will operate in the state of Rhode Island for

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a minimum of four (4) years.

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     (e) Reporting, compliance and enforcement.

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     (i) Existing annual registration requirements of the Rhode Island division of motor

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vehicles (DMV) shall be amended to include documentation of compliance with emissions

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control requirements. Documentation of compliance shall include bus model and year, engine

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model, year and VIN number, type of retrofit, date installed, date and amount of state rebate

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received. For school buses complying with the use of a clean fuel meeting requirements provided

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for in subdivision 31-47.3-5(b)(ii)(C), documentation must include clean fuel receipts (each

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delivery);

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     (ii) Annual mandatory safety inspections shall be supplemented with emission control

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compliance inspection; and

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     (iii) Civil penalties for noncompliance and additional penalties for making false claims

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shall be established. Penalty money should be directed into the Rhode Island diesel risk

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mitigation fund pursuant to subdivision 31-47.3-5(a)(3).

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     (f) Priority community provision:

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     (i) When penalty funds, state SEP funds, federal funds, or funds from other state or non-

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state sources become available, these should first be allocated toward further offsetting costs of

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achieving "best available" emissions control in "priority communities";

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     (ii) The "best available" standard is attained by all new buses (MY2007 and newer) and

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by diesel buses retrofitted with level 3-verified diesel particulate filters and closed crankcase

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filtration systems. A clean alternative fuel (such as natural gas) could also achieve an equivalent

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standard; and

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     (iii) "Priority communities" (to be identified by the Rhode Island DEM) are Rhode Island

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communities that have high levels of ambient air pollution and high incidence of childhood

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respiratory impacts.

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     31-47.3-5. Diesel emissions reduction funding program. -- (a) Fund. The Diesel

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Emissions Reduction Fund (the “fund”) is hereby established as an account in the state treasury.

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     (1) The fund shall be administered by the state treasurer for the benefit of the Diesel

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Emissions Reduction Funding Program (the "program") established under this section.

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     (2) Interest earned on the fund shall be credited to the fund.

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     (3) The fund consists of: (1) the contributions, fees, and surcharges under:(A) subsections

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5-7; and (B) penalties and fees deposited in the fund pursuant with this act.

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     (4) Monies in the fund may be used only to implement the program, provided that a

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maximum of two percent (2%) of the money in the fund may be used for administrative costs

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incurred by the DEM and the state treasurer. Monies allocated to an eligible project but not

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expended in any fiscal year may be carried over to succeeding fiscal years.

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     (5) A surcharge is hereby imposed on the retail sale, lease, or rental of new nonroad

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diesel vehicles in an amount equal to one percent (1%) of the sales price or the lease or rental

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amount.

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     (6) A surcharge is hereby imposed on every retail sale, lease or rental of every heavy duty

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diesel vehicle that is of a model year of 1998 or earlier and that is sold or leased in this state. The

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amount of the surcharge is two and one-half percent (2.5%) of the total consideration.

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     (7) In addition to the registration fees charged under [applicable section of state law], a

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surcharge is hereby imposed on the registration of a heavy duty diesel vehicle under that section

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in an amount equal to ten percent (10%) of the total fees due for registration of such vehicle

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thereunder. Said surcharges shall be remitted to the state treasurer for deposit in the fund.

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     (8) The bonding authority is hereby authorized to issue up to ten million dollars

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($10,000,000) annually before 2018 in bonds to be used solely to fund revolving loans to eligible

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diesel emission reduction projects as described in this section

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     (9) The state treasurer shall adopt any procedures needed for the collection,

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administration and enforcement of the surcharge authorized by this subsection, and shall deposit

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all surcharges to the credit of the fund.

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     (b) Establishment and administration of the program. DEM, in consultation with the

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state treasurer, shall establish by regulations promulgated pursuant to this act the Rhode Island

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Diesel Emissions Reduction Funding Program in accordance with this act.

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     (1) DEM shall administer the program and shall provide grants and low-cost revolving

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loans from the fund, on a competitive basis, to eligible projects to achieve significant reductions

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of diesel particulate emissions and/or reduced exposure to diesel particulate matter.

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     (2) In administering the program and in accordance with the requirements of this act,

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DEM shall:

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     (A) manage program funds and oversee the program;

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     (B) produce guidelines, protocols, and criteria for eligible projects;

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     (C) develop methodologies for evaluating project benefits and cost-effectiveness;

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     (D) develop procedures for monitoring whether the emissions reductions projected for

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projects awarded grants under this chapter are actually achieved;

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     (E) prepare reports regarding the progress and effectiveness of the program; and

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     (F) take all appropriate and necessary actions so that emissions reductions achieved

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through the program may be credited by US EPA to the appropriate emissions reduction

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objectives in the state implementation plan.

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     (c) Applications.

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     (1) To receive a grant or loan under the program, the applicant shall submit to DEM an

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application at a time, in a manner, and including such information DEM may require.

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     (2) An application under this subsection shall include:

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     (A) a description of the air quality of the area in which the project fleets will operate;

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     (B) a description of the project proposed by the applicant, including:

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     (i) any certified engine configuration or verified technology proposed to be used or

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funded in the project; and

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     (ii) the means by which the project will achieve a significant reduction in diesel

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emissions;

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     (C) an evaluation (using methodology approved by DEM) of the quantifiable and

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unquantifiable benefits of the emissions reductions of the proposed project;

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     (D) an estimate of the cost of the proposed project;

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     (E) a description of the age and expected lifetime control of the equipment to be used or

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funded in the proposed project;

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     (F) a description of the diesel fuel available in the areas to be served by the proposed

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project, including the sulfur content of the fuel;

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     (G) provisions for the monitoring and verification of the project; and

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     (H) such other information as may be required by DEM.

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     (d) Eligibility.

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     (1) A proposed project must meet the requirements of this section to be eligible for a

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grant or loan under the program.

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     (2) Vehicles subject to the provisions of section 39T and section 39U are not eligible for

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funding from the program.

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     (3) DEM may consider for funding the following types of projects:

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     (A) Installation of a retrofit technology, including any incremental costs of a repowered

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or new diesel engine, that significantly reduces particulate emissions through development and

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implementation of a certified engine configuration or a verified diesel emission control device

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for:

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     (i) a bus;

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     (ii) a medium-duty truck or a heavy-duty truck;

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     (iii) a commercial marine engine;

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     (iv) a locomotive; or

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     (v) a nonroad diesel engine or vehicle used in construction, handling of cargo, including

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at a port or airport, agriculture, mining, or energy production; or

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     (B) programs or projects to reduce long-duration idling using verified technology

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involving a vehicle or equipment described in subsection (A).

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     (4) In providing a grant or loan under the program, and subject to the provisions of

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subsection (c), DEM shall give priority to otherwise eligible projects that, as determined by

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DEM:

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     (A) maximize public health benefits;

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     (B) are the most cost-effective;

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     (C) serve areas:

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     (i) with the highest population density;

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     (ii) that are poor air quality areas, including areas identified by DEM as:

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     (I) in nonattainment or maintenance of national ambient air quality standards for a criteria

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pollutant;

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     (II) Federal Class I areas; or

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     (III) areas with toxic air pollutant concerns;

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     (iii) that receive a disproportionate quantity of air pollution from a diesel fleet, including

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truck stops, ports, rail yards, terminals, and distribution centers; or

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     (iv) that use a community-based multi-stakeholder collaborative process to reduce toxic

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emissions;

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     (D) include a certified engine configuration or verified technology that has a long

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expected useful life;

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     (E) will maximize the useful life of any certified engine configuration or verified

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technology used or funded by the project; and,

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     (F) conserve diesel fuel

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     (5) For a proposed project to be eligible for program funding, other than a project

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involving a marine vessel or engine, not less than seventy-five percent (75%) of vehicle miles

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traveled or hours of operation projected for the five (5) years immediately following the award of

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a grant must be projected to take place in this state. For a proposed project involving a marine

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vessel or engine, the vessel or engine must be operated in the intercoastal waterways or bays

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adjacent to this state for a sufficient amount of time over the lifetime of the project, as determined

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by DEM, to meet the cost-effectiveness requirements of subsection (e).

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     (6) Each proposed project must meet the cost-effectiveness requirements of subsection

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(e).

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     (7) A proposed project based on the use of a certified engine configuration or verified

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technology must document, in a manner acceptable to DEM, a reduction in particulate emissions

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of at least fifty percent (50%) compared with the baseline emissions adopted by DEM for the

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relevant engine year and application. After study of available emissions reduction technologies,

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after public notice and comment, DEM may revise the minimum percentage reduction in

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particulate emissions required by this subsection to improve the ability of the program to achieve

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its goals.

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     (8) If a baseline emissions standard does not exist for on-road or non-road diesels in a

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particular category DEM, for purposes of this section, shall establish an appropriate baseline

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emissions level for comparison purposes.

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     (9) DEM may approve payments to offset the incremental cost, over the expected lifetime

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of the vehicle, of the use of qualifying fuel in a on-road or non-road diesel vehicle if the proposed

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project as a whole, including the incremental fuel cost, meets the requirements of this subchapter.

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DEM shall develop an appropriate method for converting incremental fuel costs over the lifetime

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of the non-road diesel into an initial cost for purposes of determining cost-effectiveness as

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required by subsection (e).

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     (e) Cost-effectiveness.

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     (1) For purposes of this section, “cost-effectiveness” means the total dollar amount

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divided by the total number of tons of particulate matter reduction attributable to that expenditure.

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In calculating cost-effectiveness, one-time grants of money at the beginning of a project shall be

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annualized using a time value of public funds or discount rate determined for each project by

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DEM, taking into account the interest rate on bonds, interest earned by state funds, and other

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factors DEM considers appropriate.

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     (2) DEM shall establish reasonable methodologies for evaluating project cost-

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effectiveness consistent with subsection (e)(1) and with accepted methods.

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     (3) Except as provided by subsection (e)(7), DEM may not award a grant for a proposed

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project the cost-effectiveness of which, calculated in accordance with subsections (e)(1) and (2)

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and criteria developed thereunder, exceeds one hundred thirty-five thousand dollars ($135,000)

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per ton of PM10 emissions. This subsection does not restrict DEM authority under other law to

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require emissions reductions with a cost-effectiveness that exceeds one hundred thirty-five

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thousand dollars ($135,000) per ton.

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     (4) DEM may not award a grant that, net of taxes, provides an amount that exceeds the

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incremental cost of the proposed project.

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     (5) DEM shall adopt guidelines for capitalizing incremental lease costs so those costs

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may be offset by a grant under this section.

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     (6) In determining the amount of a grant under this section, DEM shall reduce the

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incremental cost of a proposed new purchase, lease, retrofit, repower, or add-on equipment

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project by the value of any existing financial incentive that directly reduces the cost of the

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proposed project, including tax credits or deductions, other grants, or any other public financial

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assistance.

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     (7) Adjustment of cost-effectiveness. Based upon a study of available emissions

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reduction technologies and costs and after public notice and comment, DEM may change the

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values of the maximum grant award criteria established in subsection (e)(3) to account for

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inflation or to improve the ability of the program to achieve its goals.

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     SECTION 3. This act shall take effect upon passage.

     

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LC01556

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N A C T

RELATING TO MOTOR AND OTHER VEHICLES -- DIESEL EMISSIONS RESOLUTION

***

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     This act would create the diesel emission reduction act.

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     This act would take effect upon passage

     

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LC01556

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H5574