This Fiscal Note is not an official copy and should not be quoted or cited.
Fiscal Note - SB 0669 - Motor Vehicle Emissions Inspections for Certain Areas
L.R. NO. 2639-01
BILL NO. Perfected SB 669
SUBJECT: Air Quality
TYPE: Original
DATE: March 26, 1996
FISCAL SUMMARY
ESTIMATED NET EFFECT ON STATE FUNDS
FUND AFFECTED FY 1997 FY 1998 FY 1999
Missouri Highway
& Transportation
Fund $0 ($302,573) ($145,951)
Mo Air Emission
Reduction Fund $0 $0 $0
Total Estimated
Net Effect on All
State Funds $0 ($302,573) ($145,951)
ESTIMATED NET EFFECT ON FEDERAL FUNDS
FUND AFFECTED FY 1997 FY 1998 FY 1999
Total Estimated
Net Effect on All
Federal Funds $0 $0 $0
ESTIMATED NET EFFECT ON LOCAL FUNDS
FUND AFFECTED FY 1997 FY 1998 FY 1999
Local Government $0 $0 $0
FISCAL ANALYSIS
ASSUMPTIONS
The Department of Revenue and the Office of Administration assume this
proposal would have no fiscal impact on their agencies.
To a previous version of this proposal, the Office of the Attorney General
assumes they would request a .25 Assistant Attorney General I to provide
legal counsel to the commission related to the establishment of rules for
certification of emissions inspectors and repair technicians. Oversight
assumes these duties can be absorbed using existing resources, and have not
included costs for the Attorney General's Office.
The Highway and Transportation Department (MHTD) assume the costs to carry
out the requirements in this proposal could exceed the established maximum
per-vehicle fee of $24. Because Section 643.350.6 allows the State Highway
and Transportation Department Fund to be used to pay operational costs of the
inspection program, there maybe an impact to the MHTD. The MHTD was unable
to estimate the potential fiscal impact to the fund.
If provisions of the bill make it difficult or impossible to meet
requirements of the Federal Clean Air Act, the possibility of federal
sanctions arises. Possible federal sanctions include withholding substantial
amounts of federal highway funds from the state. Estimates are that up to
$400,000,000 could be withheld.
The Missouri State Highway Patrol (MSHP) assumes it would request 9 FTE and
related expense and equipment costs to enforce the penalty provisions of
section 643.355.
The Department of Natural Resources (DNR) assumes they would have the
responsibility of implementing a large vehicle emission inspection program in
St. Louis including employing field oversight staff. Instead of one or a
small number of contractors with a limited number of stations, as proposed in
SB 590 passed in the 1994 Session, this proposal promotes a larger number of
small stations that are owner- operated and managed.
The metropolitan planning organizations may exempt certain rural areas from
participating in the inspection and maintenance program on the condition said
exemptions may not the credits available to the nonattainment area. Since
the DNR does not know what actions the planning organization will take, the
DNR assumes all areas will participate in the program and revenues will not
be impacted.
DNR assumes the maximum inspection fee will remain at $24 per vehicle; and
the number of inspections for FY 1998 and FY 1999 will be 840,608 and 930,586
respectively. Estimated program revenue would be $20,174,592 in 1998 and
$22,334,064 in FY 1999 for an average revenue estimate of $21,254,328.
DNR assumes this legislation, at 643.320.3, increases the amount of
unannounced audits of stations from once to four times a year. At 643.310.3
(8), the DNR is required to approve and certify inspectors. It requires an
annual review of licenses at Section 643.310.2. Lastly, DNR assumes this
bill keeps the provisions of SB 590 for reviewing and auditing repair shops
for consumer protection.
DNR assumes the provisions of this proposal as described above increase
administrative responsibilities and equipment needs over those required to
implement SB 590. A contractor hired by DNR analyzed program designs that
are similar to this bill, but without consideration of the repair function.
DNR anticipates their request would include the contractor's estimates of 25
FTE plus, two additional Environmental Specialists for field work and four
additional Motor Vehicle Mechanics for covert vehicle preparation and repair
shop audits. DNR assumes they would request the following staff to implement
the proposal:
Environmental Section Chief I/M Program Manager
Management Analyst Spec II (2) License I/M stations locations and testing
lanes, contract administration, and
financial record review.
Clerk Typist III Clerical support
Legal Advisor Legal issues related to the program
Environmental Engineer III On start-up, develop specs for station
equipment and buildings, then, check
compliance of equipment for new or renewal
of licenses. Technical assistance
regarding equipment specifications and
quality control procedures.
Environmental Engineer II Inspections of equipment which must comply
with specifications for annual review of
station licenses. Engineering assistance to
staff doing facility audits.
Computer Info Specialist IV Develop data processing (DP) requirements,
oversight of DP contractor, develop reports
for management and EPA.
Public Information Specialist I Inform the public and repair industry
about the I/M program - the enhanced
inspection process, the location of
stations, and fee amount.
Clerk Typist II (4) Phone line operators to handle questions from
the public & clerical for field staff.
Environmental Specialist IV (2) Field Operations Manager - supervise
field staff conducting station
inspections, training and licensing.
Environmental Specialist II (12) Field Staff for station licensing,
inspector training and licensing,
repair technician training oversight
and certification, waiver verification,
covert/overt auditing of inspection and
repair facilities (records and
performance audits, quality assurance.)
Motor Vehicle Mechanics (4) These positions will be responsible for
preparing vehicles for and conducting
covert audits of commercial repair
facilities and inspection licensees.
DNR assumes it would include costs of $3,006,000 for a data processing
contractor to integrate station software with a central data management
system; maintain real time communication links between state agencies (DNR
and DOR) and stations; coordinate the electronic transmission of data to and
from stations and from the DP contractor to the state; and provide reports to
the state, EPA, and General Assembly. These costs from the consultant s
study are based on the number of inspections conducted in the area and will
not vary significantly if the number of inspection facilities varies.
DNR's request includes costs of $10,300 for sophisticated transient test
equipment which requires the use of test gases of known concentration,
valves, gauges and other measurement devices.
DNR assumes they would request funds for communication expenses including
$50,000 for public information costs to provide uniform area-wide information
to the public regarding inspection requirements, location of stations, and
hours of operation. The stations also must be given information on their
responsibilities and technical issues.
DNR's response includes costs of $217,845 to purchase vehicles of various
model years to be used not only for field transportation but also for covert
audits of inspection and repair facilities. DNR assumes they would need to
purchase seven new vehicles for $118,965 and 12 used vehicles for $98,880,
half the cost of new vehicles.
DNR assumes they will accept credentials from a national accreditation
organization, such as the National Institute for Automotive Service
Excellence for certification of repair technicians.
DNR assumes $4,187,100 will be needed to purchase, or "buy-back" analyzers
owned by businesses participating in the current I/M program. Currently,
there are approximately 880 analyzers in use. As new transient test
equipment will be required, most analyzers will have to be bought back.
Most of the analyzers were purchased when the current program started in 1990
for $11,000 to $20,000. The majority were bought at the lower end of the
price range. The DNR estimated 850 analyzers would be bought back for $4,926
each, or 40% of the original price.
DNR assumes annualized state costs of $5,216,957 which is 24.55% of the
estimated annual revenues of $21,254,328. Accordingly, of the $24 fee for
emission inspections $5.89 ($24.00 x .2563) would have to go to the state to
cover state costs. As state costs increase due to inflation, the state share
would be more than $5.89 per inspection.
DNR assumed the remaining $16,037,371 ($21,254,328 annualized revenues less
$5,216,957 annualized state costs) would be available for private entities to
operate emission inspection stations. The private entity would retain 75.45%
of the $24.00 inspection fee which is $18.11. The $18.11 per inspection
received must cover the private entities land and building costs, costs of
test equipment, and the stations operating costs.
DNR assumed this fund would participate in the department's Cost Allocation
Plan which would mean additional administrative costs of $382,890 annually.
The consultant study estimated that the St. Louis area would need a minimum
of 62 lanes to adequately handle the estimated inspections in a timely manner
(i.e. customer convenience including minimum wait times). In addition, the
department believes two referee stations, whether state-owned or privately
owned, would be necessary.
The consultant hired by DNR estimated it would cost $383,879 annually for a
single lane inspection facility. (Costs of additional lanes at a facilities
would be less than $383,879 per lane.) These costs include:
Inspection Station Salaries $107,588
Land and Buildings $ 80,471 ($496,188 amortized over 7
years at 11%)
Test Equipment $ 36,969 ($179,850 amortized over 7
yrs at 11%)
Station Operating Cost $ 63,603
Management Fee $ 95,248 (33% of cost)
Accordingly, DNR assumes the proposed legislation provides adequate funding
for approximately 40 single-lane inspection stations and 2 single-lane
referee stations.
This proposed legislation keeps the provisions of the original bill for a fee
penalty for excessive consumer waiting times. Up to $20 of the fee cannot be
collected by the station operator, depending on the length of time the
vehicle owner must wait for an inspection.
DNR assumes the consultant s study is correct and 62 lanes represents the
minimum number of lanes to meet the original SB 590 requirements. DNR
estimates the maximum number of lanes with this legislation to be 40.
Therefore, DNR assumes funds available for this legislation will not meet the
minimum requirements necessary for an effective enhanced maintenance program.
Oversight is aware that SB 590, establishing an enhanced
inspection/maintenance program, was passed in the 1994 session.
Subsequently, the funding for the program was eliminated and the program was
not implemented. Regardless of the current funding or implementation status
of the program, Oversight has based its fiscal note only on the changes to
the statutes proposed by this piece of legislation. To determine the total
costs of establishing an enhanced inspection/ maintenance program, the fiscal
impact and budget history of SB 590 should also be considered.
Oversight assumes substantially all of the costs in the MSHP's and DNR's
response are related to the basic implementation of a vehicle emission
inspection program. Accordingly, they have not been included as a cost to
this proposal. There are two exceptions. The first, personal service costs
of approximately $90,000 and related expenses including $10,300 for test
equipment for four Motor Vehicle Mechanics to conduct the increased
inspections required in this proposal. The second is costs of $150,000 to
develop a contract and procedures to be used by inspectors.
The proposal states the financial viability of the stations will be given
consideration. Oversight assumes such consideration would be particularly
important as the existence of the stations is completely at the discretion of
private contractors. Oversight assumes the proposal's intent is for the
fee to cover the cost of the program, however, section 643.350.6 of the
current statute makes a provision for other state funds such as General
Revenue and the State Highway Department Fund to be used if necessary.
For the purposes of this fiscal note, Oversight accepts DNR's assumptions
that 62 lanes are needed to meet the requirements of the proposal, and the
costs to operate each lane could be as high as $383,879. Accordingly,
contractor costs could reach $23,800,498 per year. Projected annual revenue
would be approximately $21,254,328. Therefore, in an attempt to make this
program as attractive as possible to private contractors, Oversight must
assume the entire fee of $24 will be available to the contractors. Any state
costs must be born by other funds as provided by section 643.350.6.
FISCAL IMPACT - State Government FY 1997 FY 1998 FY 1999
(10 Mo.)
STATE HIGHWAY & TRANSPORTATION FUND
Transfer Out - to
MO Air Emission Reduction Fund $0 ($302,573) ($145,951)
MO AIR EMISSION REDUCTION FUND
Income - DNR
Transfer In - from
State Highway & Transportation Fund $0 $302,573 $145,951
Costs - DNR
Personal Service (4 FTE) $0 ($90,219) ($92,475)
Fringe Benefits 0 (27,733) (28,427)
Expense and Equipment 0 (184,620) (25,050)
$0 ($302,573) ($145,951)
Estimated Net Effect on -
MO AIR EMISSION REDUCTION FUND $0 $0 $0
FISCAL IMPACT - Local Government FY 1997 FY 1998 FY 1999
(10 Mo.)
0 0 0
DESCRIPTION
This act modifies the motor vehicle emission inspection program for the
greater St. Louis metropolitan area. The inspections were mandated in SB 590,
1994, but have not been implemented. SB 590 required the DNR to contract
with a person or persons for vehicle emission inspections and such persons
were prohibited from performing any other work at the inspection station,
such as vehicle repair. This act allows the DNR to license inspection
stations and these stations are prohibited from performing other services.
Inspectors and emission repair technicians must be certified by the Air
Conservation Commission. SB 590 delayed the implementation of new vehicle
testing procedures until after termination of a suit filed by the State of
Missouri against the Environmental Protection Agency contesting the
constitutionality of the sanctions contained in the federal Clean Air Act.
The act contains penalty provisions.
This inspection requirements would apply to vehicles with a gross vehicle
weight rating in excess of 8,500 pounds.
The amended proposal allows local metropolitan planning organizations to
exempt certain rural areas from the inspection and maintenance program
provided the exemption does not effect the credits available to the
nonattainment area.
As amended this, act requires DNR and the Highway Patrol to establish, by
December 31, 1996, an interagency agreement on all aspects of the
administration and enforcement of the current BAR90 and future enhanced motor
vehicle Inspection and Maintenance programs.
Fleet operators with a minimum of 100 vehicles may establish facilities to
test their own vehicles.
As amended, the proposal exempts certain counties from Rule 10-5.070 of the
CARS, pertaining to open-burning, until the county attains a population of
100,000.
This legislation is not federally mandated, would not duplicate any other
program and would not require additional capital improvements or rental
space.
SOURCES OF INFORMATION
Missouri Department of Natural Resources
Missouri Highway and Transportation Department
Missouri State Highway Patrol
Missouri Department of Revenue
Office of Administration
Office of the Attorney General