Fiscal Note - SB 0072 - Motor Vehicle Emissions Inspections For Certain Areas
L.R. NO. 0406-02
BILL NO. Perfected SB 72
SUBJECT: Enhanced Inspection and Maintenance Program
TYPE: Corrected
DATE: April 7, 1997
# Corrected to clarify assumptions (page 7)
FISCAL SUMMARY
ESTIMATED NET EFFECT ON STATE FUNDS
FUND AFFECTED FY 1998 FY 1999 FY 2000
MO Air Pollution
Control Fund ($70,064) ($143,755) ($147,348)
Total Estimated
Net Effect on All
State Funds ($70,064) ($143,755) ($147,348)
ESTIMATED NET EFFECT ON FEDERAL FUNDS
FUND AFFECTED FY 1998 FY 1999 FY 2000
None $0 $0 $0
Total Estimated
Net Effect on All
Federal Funds $0 $0 $0
ESTIMATED NET EFFECT ON LOCAL FUNDS
FUND AFFECTED FY 1998 FY 1999 FY 2000
Local Government $0 $0 $0
FISCAL ANALYSIS
ASSUMPTION
The Department of Revenue and the Office of the Attorney General assumes this
proposal would have no impact to their agency.
The Department of Transportation (DOT) assumes 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 DOT. The DOT 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 would arise, including withholding of substantial amounts of
federal highway funds from the state.
The (MSHP) assumes they would request 9 FTE including six Troopers, 2
Clerk-Typists, and a Computer Specialist and related equipment and expenses
for their part in the administration and enforcement of section 643.355. The
Troopers' duties would include enforcement and investigation of the emission
program, and presenting testimony at the Air Conservation Commission
Administrative Hearing regarding CSR rules. The Computer Specialist would
create and implement a tracking system for enhanced violations.
The MSHP assumes Troopers would be required over civilian Motor Vehicle
Inspectors because only empowered law enforcement officers can search and
seize documents needed for investigations. Troopers are also needed because
a large portion of the inspection program is in very high crime areas and
civilians would be unsafe in these areas with no method for self protection.
Troopers would require training in Motor Vehicle Inspection and Emission
regulations and would be required to attend an emission component and
emission repair training courses.
First, 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 affect 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 he program and revenue to the
Missouri Air Emissions Reduction Fund will not be impacted.
DNR assumes the maximum inspection fee will remain at $24 per vehicle; and
the number of inspections for FY 1999 and FY 2000 will be 907,668 and 829,353
respectively. Estimated program revenue would be $21,784,032 in 1999 and
$19,904,472 in 2000 for an average revenue estimate of $20,844,252.
DNR assumes this proposal at 643.320.3, increases the amount of unannounced
audits of stations from once a year 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 provision of SB 590 for the review and auditing of 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 the require the staff listed below to
implement an Enhanced Inspection and Maintenance Program. Of the staff listed
below, DNR was authorized 15 positions in their FY 1997 budget.
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's request includes costs of $10,000 for sophisticated transient test
equipment which requires the use of test gases of known concentration,
valves, gauges and other measurement devices.
DNR's consultant estimated public information costs to provide uniform
area-wide information to the stations and to the public regarding inspection
requirements, location of stations, and hours of operation to range from
minimal to $500,000 depending upon the number of contractors operating
stations. For purposes of the fiscal note DNR assumes there will be multiple
contractors operating multiple lanes and have estimated public information
costs. After consulting Ohio and Colorado, DNR has estimated costs to be
$500,000 over seven years, $344,000 the first year and $28,000 in each of the
following years. DNR assumes communication costs are difficult to estimate,
and based on Ohio's expenditure of $955,000 and Colorado's costs of $750,000
additional resources may be necessary.
DNR assumes it would include costs of approximately $3.2 million 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 response includes costs of $211,500 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 $115,500 and 12 used vehicles for $96,000,
approximately 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 $5,211,287 which is 25% of the
estimated annual revenues of $20,844,252. Accordingly, of the $24 fee for
emission inspections $6.00 ($24.00 x .25) 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 $6.00 per inspection.
DNR assumed the remaining $15,632,965 ($20,844,252 annualized revenues less
$5,211,287 annualized state costs) would be available for private entities to
operate emission inspection stations. The private entity would retain 75% of
the $24.00 inspection fee which is $18.00. The $18.00 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 approximately
$350,000 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 39 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 probability of
lost income resulting from excessive consumer waiting time is high.
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 39.
Therefore, DNR assumes funds available for this legislation will not meet the
minimum requirements necessary for an effective enhanced maintenance program.
Second, the DNR assumes the proposal would remove Open Burning Restrictions
(10 CSR 10-5.070) in unincorporated Franklin County. DNR assumes emissions
reduction credit for volatile organic compounds (VOC) of .72 tons per day
would be lost. The DNR assumes they would be required to revise the existing
open burning rules and promulgate new rules or amend current emission control
rules to make up the emission reductions lost, if open burning is allowed.
DNR assumes the removal of the unincorporated portion of Franklin County
could make the State Implementation Plan, which has been partially approved,
disapprovable since the plan includes controls stipulated in the department's
rules. As a result, the DNR would have to resubmit the plan to EPA for
approval once the .72 tons per day has been absorbed by other parts of the
St. Louis nonattainment area.
DNR assumes there will be additional costs to industry to make up the .72
tons per day of lost reductions from allowing open burning in Franklin
County.
The DNR estimates the staff time to complete the activities involved in
amending existing rules and/or promulgating new rules, and renegotiating the
State Implementation Plan to be at least 1,800 hour. DNR estimates this
would cots approximately $60,000 including personal services.
Oversight is aware that SB 590, establishing an enhanced inspection and
maintenance program, was passed in the 1994 session. In the past funding for
the program was eliminated and the program was not implemented. Then, in FY
1997, the DNR received funding to phase-in an enhanced vehicle emission
inspection program. 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 an enhanced vehicle
emission inspection program. Accordingly, they have not been included as a
cost to this proposal. There are two exceptions. The first exception is the
four Motor Vehicle Mechanics to conduct the increased inspections required in
this proposal. The DNR expects to request $44,895 in FY 98 for the first two
Motor Vehicle Mechanics. In FY 99, the DNR would request the remaining two
Motor Vehicle Mechanics which would bring the total personal service
costs up to $92,035. In FY 2000, the personal service costs for the four
Motor Vehicle Mechanics would be $94,336.
The second exception is costs of $150,000 to develop a contract and
procedures to be used by inspectors. Oversight assumes DNR received an
appropriation for $150,000 to develop the contract in the FY 1997 Budget and
has not included those costs in the fiscal note.
Oversight assumes any administrative costs which may result if the
unincorporated portion Franklin County were exempted from the Open Burning
Restrictions could be absorbed with existing resources as the process of
revising and promulgating rules is an on-going process.
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 licensees. 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 including the 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,
licensee costs could reach $23,800,498 per year. Projected annual revenue
would be approximately $20,844,252. Therefore, in an attempt to make this
program as attractive as possible to private licensees, Oversight must assume
the entire fee of $24 will be available to them. Any state costs must be
born by other state funds as provided by section 643.350.6.
The DNR assumes this proposal terminates certain rules within 18-months after
they are promulgated. At this time the DNR assumes this provision would not
fiscally impact the DNR. However, the amendment does not specify what will
happen at the termination of the rule or rules; if the intent is for the
department to re-promulgate the rule(s) the department may need additional
resources.
FISCAL IMPACT - State Government FY 1998 FY 1999 FY 2000
OTHER STATE FUNDS
Costs - DNR
Personal Service - (2 FTE) ($44,895)
Personal Service - (4 FTE) ($92,035) ($94,336)
Fringe Benefits (12,809) (26,258) (26,914)
Expense and Equipment (12,360) (25,462) (26,098)
Estimated Net Effect on -
OTHER STATE FUNDS ($70,064) ($143,755) ($147,348)
FISCAL IMPACT - Local Government FY 1998 FY 1999 FY 2000
(10 Mo.)
$0 $0 $0
FISCAL IMPACT - Small Business
There may be costs to some small businesses who may be required to implement
additional air emission controls to compensate for the .72 tons per day of
emission reductions lost by lifting the restrictions on open burning in
unincorporated Franklin County.
DESCRIPTION
This act, with penalty provisions, modifies the motor vehicle emission
inspection program for the greater St. Louis metropolitan area. The
inspections were mandated in SB 590, from 1994, but have not been fully
implemented. SB 590 required the Department of Natural Resources to contract
with a person or persons for vehicle emission inspections and such persons
are prohibited from performing any other work at the inspection station, such
as vehicle repair. Rather than contract for vehicle inspections, this act
allows the DNR to license inspection stations. 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 does not change
this provision of SB 590.
The act requires the DNR and the Missouri Highway Patrol to enter into an
interagency agreement covering all aspects of the administration and
enforcement of the current BAR90 emissions inspection and any enhanced
emissions inspection implemented under Chapter 643, RSMo.
The unincorporated portion of any first class, non-charter county with a
population of at least eighty thousand persons shall be exempt from the state
open burning restriction rule until such county reaches a population of at
least one hundred thousand persons.
The act restricts establishment of the enhanced emissions inspection program
to the urbanized portion of the St. Louis nonattainment area, as determined
by the local metropolitan planning organization.
This proposal mandates that the licenses are to be issued for a period of
seven years with an annual review. The license may be revoked or suspended
under certain conditions. As amended, this proposal subjects licensees found
in violation certain sections to penalties. The amendment clarifies that the
MSHP and other agencies are potential users of the Missouri Air Emission
Reduction Fund
This proposal requires that certain DNR rules terminate within 18-months of
being promulgated.
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
Office of the Attorney General
Department of Natural Resources
Department of Transportation
Missouri State Highway Patrol
Department of Revenue
AGENCIES NOT RESPONDING:
City of St. Louis
This Fiscal Note is not an official copy and should not be quoted or cited.