BILL ANALYSIS                                                                                                                                                                                                    



                                                                  SB 1170
                                                                  Page  1

          Date of Hearing:   July 10, 2001

                   ASSEMBLY COMMITTEE ON BUSINESS AND PROFESSIONS
                                  Lou Correa, Chair
                      SB 1170 (Sher) - As Amended:  July 3, 2001

           SENATE VOTE  :   30-8
           
          SUBJECT  :   State vehicle fleet.

           SUMMARY  : This bill requires various state agencies to develop  
          and adopt fuel-efficiency and air pollution emission standards  
          and recommendations governing the purchase of new state vehicles  
          and replacement tires that will result in reduced petroleum  
          consumption.  Specifically,  this bill  :

          1)Provides that it is the policy of the state to minimize the  
            use of petroleum-based fuels by state agencies, to purchase  
            the cleanest and most efficient vehicles and replacement  
            tires, to maximize the use of alternative fuels, and to  
            implement all other practicable and cost-effective  
            conservation measures.

          2)Requires the California Energy Commission (CEC), the  
            Department of General Services (DGS), and the State Air  
            Resources Board (ARB) to adopt fuel-efficiency standards  
            governing the purchase of new state vehicles and replacement  
            tires by the state.

          3)Requires CEC, by January 31, 2003, to develop and adopt  
            recommendations, for consideration by the Governor and  
            Legislature, for developing fuel-efficiency ratings for tires.

          4)Requires CEC and DGS to conduct a study analyzing the costs  
            and benefits of a 10 percent reduction in state fleet energy  
            consumption by January 1, 2005, and directs the state to  
            pursue a waiver from federal requirements governing the state  
            purchase of vehicles in specified circumstances.

          5)Requires CEC, DGS, and ARB, by January 31, 2003, and annually  
            thereafter, to develop and adopt air pollution emission  
            specifications governing the purchase of passenger and  
            light-duty trucks that meet or exceed the state's Ultra-Low  
            Emission Vehicle (ULEV) standards for exhaust emissions.









                                                                  SB 1170
                                                                  Page  2

           EXISTING LAW  

          1)Finds and declares that petroleum use as an energy resource  
            contributes substantially to specified public health and  
            environmental problems.

          2)Requires CEC to acquire and analyze information to determine  
            future energy problems and uncertainties, including impacts of  
            petroleum price increases and projected conservation measures  
            on the demand for energy.

          3)Provides that it is the policy of the state to evaluate the  
            economic and environmental costs of petroleum use and to  
            establish a state transportation energy policy that results in  
            the least environmental and economic cost to the state.

          4)Requires DGS, under the California Integrated Waste Management  
            Act, to use retreaded tires as replacements in support of the  
            state's recycling efforts.

           FISCAL EFFECT  :   Unknown

           COMMENTS  :

          According to supporters, this bill is intended to put California  
          at the forefront of efforts to reduce fuel consumption, largely  
          through the purchase of fuel-efficient vehicles and replacement  
          tires.  California's rising gasoline consumption threatens not  
          only our environment, but also our economic well being.   
          According to a study by CEC, we can expect more frequent and  
          severe gasoline price shocks in the future.

          The State of California, through DGS, purchases about 1,500  
          fleet vehicles every year.  This figure includes passenger  
          vehicles, but does not include patrol cars and other special  
          purpose vehicles.  Under federal law, 75 percent of state fleet  
          purchases must be alternative fuel capable.  There is no  
          requirement for these vehicles to actually run on alternative  
          fuels, and, due to limited alternative fueling infrastructure  
          and availability, most run on gasoline.

          Current DGS policy is to purchase certified Ultra Low Emission  
          Vehicles (ULEV) or Super Ultra Low Emission Vehicles (SULEV) for  
          the 25 percent of its fleet not required to be  
          alternative-fueled.  The ULEV and SULEV designations relate to  








                                                                  SB 1170
                                                                  Page  3

          emissions, not fuel efficiency.  However, it could be argued  
          that the conversion of the state fleet into low and zero  
          emission vehicles would have the additional benefit of  
          significantly increasing fuel efficiency.

          According to supporters, original equipment tires are three to  
          four percent more fuel-efficient than typical replacement tires.  
           This bill requires CEC to develop and adopt recommendations for  
          developing fuel-efficiency ratings for tires.  Supporters  
          suggest that requiring more fuel-efficient replacement tires is  
          a cost-effective method to reduce fuel consumption.

          Recent amendments address the possible conflict between  
          provisions of this bill that seek to achieve greater levels of  
          fuel-efficiency and existing statutes that seek to achieve  
          greater levels of recycling with respect to the purchase of  
          replacement tires.  A CEC and DGS study required by this bill  
          includes, among other things, an analysis of the costs and  
          benefits of using fuel-efficient tires relative to using  
          retreaded tires, as described in the Retreaded Tire Program.

           REGISTERED SUPPORT / OPPOSITION  :

           Support 
           
          American Lung Association of California
          Clean Power Campaign
          Natural Resources Defense Council
          Planning and Conservation League
          Sierra Club
           
           
           Opposition 
           
          None on file.

           Analysis Prepared by  :    Mark McKenzie / B. & P. / (916)  
          319-3301