Researcher: HP Page 1 4/11/22 OLR Bill Analysis sSB 4 AN ACT CONCERNING THE CONNECTICUT CLEAN AIR ACT. TABLE OF CONTENTS: SUMMARY § 1 — STATE FLEET ELECTRIFICATION Modifies the schedule for electrifying the state fleet, prohibits procurement of diesel- powered buses after January 1, 2024, and requires DOT and DAS to report certain information to the legislature §§ 2 & 3 — RIGHT TO CHARGE IN CONDOMINIUMS AND COMMON INTEREST COMMUNITIES Establishes “right to charge” in condominiums and common interest communities by voiding provisions in governing documents that unreasonably restrict EV charging installation in a unit or limited common element parking space; establishes requirements for processing applications and provisions applicable to charging station installation § 4 — RENTERS’ RIGHT TO CHARGE Generally requires landlords of dwelling units to approve a tenant’s written request to install an EV charging station at the tenant’s dedicated parking space and specifies the contents and terms of the written request and the landlord-tenant agreement § 5 — EV CHARGING REQUIREMENTS IN NEW CONSTRUCTION Requires a certain percentage of parking spaces in certain new construction to be equipped with either EV charging stations or charging station infrastructure § 6 — PROPERTY TAX EXEMPTIONS Exempts from property taxes certain EV charging stations, fuel cell vehicle refueling equipment, and zero-emission buses §§ 7 & 11 — CHEAPR PROGRAM AND GHG REDUCTION FEE Makes numerous changes to the CHEAPR program, including making the CHEAPR board advisory-only, modifying the board’s membership, giving priority to low-income individuals and residents of environmental justice communities, and extending eligibility to businesses, municipalities, nonprofits, and e-bikes; directs the entirety of the GHG reduction fee to the CHEAPR program §§ 8 & 20 — EV REGISTRATION FEE Eliminates the reduced registration fee for electric vehicles §§ 9 & 10 — CLEAN AIR ACT (CAA) FEE Requires that CAA fee revenue be placed in dedicated accounts within the General Fund and the Special Transportation Fund and used for clean air and clean transportation expenses 2022SB-00004-R000406-BA.DOCX Researcher: HP Page 2 4/11/22 §§ 12 & 13 — TRAFFIC SIGNAL GRANT PROGRAM Requires DOT to establish a matching grant program to help municipalities modernize existing traffic signal equipment and authorizes $75,000,000 in bonds to fund it §§ 14 & 19 — MEDIUM AND HEAVY -DUTY TRUCK VOUCHERS Allows DEEP to establish a voucher program to support the deployment of zero-emission medium- and heavy- duty vehicles and appropriates $15 million to fund the program §§ 15-17 — ZERO EMISSION SCHOOL BUSES Allows for 10-year school transportation contracts if the contract includes at least one zero-emission bus, sets targets for converting school buses to zero-emission vehicles, and establishes a matching grant program for zero-emission school buses and charging infrastructure § 18 — STATE CARBON BUDGET Requires DOT, in consultation with DEEP, to adopt a transportation carbon budget and adopt implementing regulations to ensure that transportation projects adhere to the budget BACKGROUND SUMMARY This bill makes various changes in existing law and establishes several new programs and initiatives concerning electric vehicle (EV) use and improving air quality by reducing transportation-related greenhouse gas (GHG) emissions. Major components include: 1. establishing grant programs for traffic signal modernization, zero emission school buses, and zero-emission medium- and heavy-duty trucks; 2. requiring the Department of Transportation (DOT) to establish a carbon budget for the transportation sector; 3. providing property tax exemptions for zero-emission buses and certain EV charging infrastructure; 4. modifying the Connecticut Hydrogen and Electric Automobile Purchase Rebate (CHEAPR) program, including by expanding eligibility, giving priority for incentives to people with low incomes and environmental justice community residents, allowing incentives for electric bicycles, and increasing its funding; and 2022SB-00004-R000406-BA.DOCX Researcher: HP Page 3 4/11/22 5. establishing “right to charge” provisions for renters and unit owners in condominiums and common interest communities. EFFECTIVE DATE: July 1, 2022, unless otherwise noted below. § 1 — STATE FLEET ELECTRIFICATION Modifies the schedule for electrifying the state fleet, prohibits procurement of diesel- powered buses after January 1, 2024, and requires DOT and DAS to report certain information to the legislature Cars and Light Duty Trucks Current law requires that, beginning January 1, 2030, at least 50% of state-purchased or -leased cars and light duty trucks be zero-emission vehicles. The bill eliminates this requirement and instead requires the state to acquire cars and light duty trucks that are battery electric vehicles on the following schedule: (1) 50% by January 1, 2026, (2) 75% by January 1, 2028, and (3) 100% by January 1, 2030. Under the bill, a “battery electric vehicle” is a vehicle that operates solely by use of a battery or battery pack, or that is powered primarily by an electric battery or battery pack and uses a flywheel or capacitor that stores energy produced by an electric motor or through regenerative braking to assist in vehicle operation. The bill also requires the Department of Administrative Services (DAS) to consider the lower cost of maintaining battery electric vehicles when establishing the amount to lease the vehicles to another state agency. Report on Noncompliance. Under the bill, if the state fleet does not meet the above requirements, DAS must report to the Government Administration and Elections (GAE), Transportation, and Environment committees to (1) explain why the requirements were not met and (2) propose an alternative schedule to meet them, considering available funds and market conditions for battery electric vehicles and associated charging infrastructure. This report must be submitted annually starting January 1, 2026. Buses 2022SB-00004-R000406-BA.DOCX Researcher: HP Page 4 4/11/22 Existing law requires that, starting January 1, 2030, at least 30% of state-purchased or -leased buses be zero-emission buses. Beginning January 1, 2024, the bill also prohibits the state from procuring, purchasing, or leasing diesel-fueled transit buses. A “zero-emission bus” is an urban bus certified by the California Air Resources Board’s executive director as producing zero emissions of any criteria pollutant under all operational modes and conditions. Exemptions The bill’s fleet requirements to not apply to emergency vehicles, sport utility vehicles, buses or vans that transport individuals in wheelchairs, specialty upfitted motor vehicles, or camp trailers. Study and Reporting Existing law requires DAS, in consultation with DOT, to conduct a study and report certain information about zero-emission buses to the GAE and Transportation committees. The bill adds two components to this study by requiring the agencies to (1) develop a plan to implement zero-emission buses statewide and (2) identify barriers to implementation. It also eliminates the current requirement that the agencies study the feasibility of a competitive bid process for total procurement of zero-emission vehicles and instead requires that they also do so for light, medium, and heavy-duty battery electric vehicles and fuel cell electric vehicles. Under the bill, DAS must report the study’s results and a copy of the implementation plan to the committees by January 1, 2024. EFFECTIVE DATE: October 1, 2022 §§ 2 & 3 — RIGHT TO CHARGE IN CONDOMINIUMS AND COMMON INTEREST COMMUNITIES Establishes “right to charge” in condominiums and common interest communities by voiding governing document provisions that unreasonably restrict EV charging installation in a unit or limited common element parking space; establishes requirements for processing applications and provisions applicable to charging station installation The bill establishes “right to charge” provisions for unit owners in condominiums (§ 2) and common interest communities (§ 3). Beginning 2022SB-00004-R000406-BA.DOCX Researcher: HP Page 5 4/11/22 October 1, 2022, the bill makes void and unenforceable any provision in declarations, bylaws, rules, or condominium instruments, as applicable (“governing documents”), that prohibit or unreasonably restrict EV charging station installation in a unit or limited common element parking space. An EV charging station is an electric component assembly or cluster of component assemblies designed specifically to charge batteries in EVs by permitting the transfer of electric energy to a battery or other storage device. Limited common elements are portions of the condominium or common interest community designated as reserved for the use of one or more units, but not all units. Under the bill, EV charging stations in condominiums and common interest communities must meet all applicable health and safety standards and requirements under federal, state, or municipal law. Exceptions The bill’s right to charge provisions do not apply to condominiums and common interest communities that (1) impose “reasonable restrictions” on EV charging stations or (2) have EV charging stations in a number that is at least equal to 15% of the units. Reasonable restrictions are those that do not significantly increase an EV charging station’s cost or decrease its efficiency or specified performance. Application Processing Under the bill, unit owners may apply to install an EV charging station to the applicable governing body (board of directors or executive board). The governing body must (1) acknowledge, in writing, the application within 30 days after receiving it and (2) approve or deny an application, in writing, within 60 days after receiving it. The governing body must process the application in the same way as the governing documents require for other additions, alterations, or improvements. Under the bill, unless the governing body reasonably requests additional information within the 60-day period for acting on an application, an application that is not denied in that timeframe is 2022SB-00004-R000406-BA.DOCX Researcher: HP Page 6 4/11/22 deemed approved. Conditions for Approval Under the bill, the governing body may approve an EV charging installation if the owner agrees in writing to: 1. comply with provisions in the governing documents regarding an addition, alteration, or improvement; 2. have a licensed and insured contractor install the charging station; 3. if the station is located in a unit parking space, provide a certificate of insurance within 14 days after approval naming the association as an additional insured under the owner’s insurance policy; 4. pay for the charging station’s installation associated costs (e.g., increased master policy premiums, association attorney’s fees, engineering or professional fees, permits, and applicable zoning compliance); and 5. connect the electricity to the unit’s individual meter or install a separate meter to identify and pay for the charging station’s electricity usage. Unit Owner Responsibilities The bill makes the unit owner, and each successive owner, of the EV charging station responsible for the following: 1. costs for damage to the EV charging station, common elements, or units due to the EV charging station’s installation, use, maintenance, repair, removal, or replacement; 2. costs to maintain, repair, and replace the EV charging station until its removal; 3. costs to restore the physical space where the charging station was installed after its removal; 2022SB-00004-R000406-BA.DOCX Researcher: HP Page 7 4/11/22 4. associated electricity costs; 5. common expenses from uninsured losses under any master insurance policy the association holds on behalf of unit owners; and 6. disclosing to prospective buyers (a) the charging station’s existence, (b) the associated responsibilities, and (c) that the purchaser accepts the charging station unless it is removed before the unit’s transfer. The bill also specifies that a unit owner is not required to maintain liability coverage for an existing National Electrical Manufacturers Association standard alternating current power plug. Permitted Association Actions The bill specifically authorizes associations to do the following: 1. install an EV charging station in the common elements to be used by all unit owners if it develops appropriate rules for the station’s use, 2. create a new parking space where one did not previously exist to facilitate installing an EV charging station, and 3. require the unit owner to remove the EV charging station before the unit’s sale unless the purchaser agrees to take ownership of the station. Attorney’s Fees The bill specifies that the prevailing party must be awarded reasonable attorney’s fees in any action by an association seeking to enforce compliance with the bill. EFFECTIVE DATE: October 1, 2022 § 4 — RENTERS’ RIGHT TO CHARGE Generally requires landlords of dwelling units to approve a tenant’s written request to install an EV charging station at the tenant’s dedicated parking space and specifies the contents and terms of the written request and the landlord-tenant agreement 2022SB-00004-R000406-BA.DOCX Researcher: HP Page 8 4/11/22 The bill generally requires landlords of dwelling units to approve a tenant’s written request to install an EV charging station (see above) at the tenant’s dedicated parking space if the request (1) meets the bill’s requirements and (2) complies with the landlord’s procedural approval process for property modifications. This requirement applies to rental agreements executed, extended, or renewed on or after October 1, 2022. Under the bill, a “dedicated parking space” is a parking space located within a lessee’s separate interest or a parking spot that is a common area, but subject to an individual lessee’s exclusive use rights. It includes a garage space, carport, or parking space that is specifically designated for the lessee’s use. A “dwelling unit” is any house or building, or part of one, that is occupied or designed to be occupied, or is rented, leased, or hired out to be occupied as a residence. The bill specifies that landlords (1) are not obligated to provide an additional parking space to a tenant to accommodate an EV charging station and (2) may charge a monthly rent for a parking space if the EV charging station has the effect of providing the tenant with a reserved space. Under the bill, an EV charging station, and all property modifications and improvements, must comply with applicable state, federal, or municipal laws and zoning requirements, land use requirements, covenants, conditions, and restrictions. Exceptions The bill’s requirements do not apply to residential rental property where: 1. the dwelling unit has EV charging stations for tenants’ use in at least 10% of designated parking spaces; 2. parking is not provided as part of the rental agreement; 3. there are fewer than five parking spaces; 4. the property’s development is assisted by an allocation of Low 2022SB-00004-R000406-BA.DOCX Researcher: HP Page 9 4/11/22 Income Housing Tax Credits under federal tax law; or 5. the property is managed by a housing authority created under state law. Request and Agreement Under the bill, a tenant’s written request to install an EV charging station must indicate his or her consent to enter into a written agreement with the landlord that includes provisions on the following: 1. installing, using, maintaining, and removing the EV charging station and its infrastructure; 2. permission for the landlord to withhold all or part of a security deposit at the end of a tenancy for any damages the landlord suffers if the tenant fails to comply with the landlord’s requirements on maintaining and removing the EV charging station and its infrastructure; 3. a complete financial analysis and scope of work regarding the EV charging station and its infrastructure; 4. payment to the landlord for any costs associated with the landlord’s installation of the EV charging station and its infrastructure before any modification or improvement to the rental property (e.g., permitting, supervision, construction costs, performance bonds); 5. payment, as part of rent, for the landlord’s incurred costs associated with the electric usage of the EV charging station and costs for damage, maintenance, repair, removal, and replacement of the EV charging station (including changes or improvements to the rental property); 6. maintaining a general liability insurance policy that covers the EV charging station and names the landlord as an additional insured, beginning on the date of construction approval and until the tenant forfeits possession of the unit to the landlord; and 2022SB-00004-R000406-BA.DOCX Researcher: HP Page 10 4/11/22 7. a requirement that the tenant (a) post a surety bond in an amount equal to the cost of removing the EV charging station or (b) agree to designate the station as a fixture of the rental property if the tenant does not remove it upon the lease’s termination. EFFECTIVE DATE: October 1, 2022 § 5 — NEW CONSTRUCTION EV CHARGING REQUIREMENTS Requires a certain percentage of parking spaces in certain new construction to be equipped with either EV charging stations or charging station infrastructure Under the bill, DAS must require that each new construction of a state facility and “school building project” (see BACKGROUND) be installed with level two EV charging stations in at least 20% of parking spaces designated for cars or light-duty trucks. The bill also requires municipalities to require that each new construction of a commercial building or multi-unit residential building with 30 or more parking spaces be equipped with EV charging infrastructure in at least 10% of parking spaces. Municipalities may, through their legislative bodies, require these buildings to have charging infrastructure in a higher percentage of spaces. The charging infrastructure must be capable of supporting level two EV charging stations or higher. Under the bill, a “level two EV charging station” is an electric component assembly or cluster of component assemblies designed specifically to supply electricity to battery electric vehicles at 240 volts and up to 80 amperes. EFFECTIVE DATE: October 1, 2022 § 6 — PROPERTY TAX EXEMPTIONS Exempts from property taxes certain EV charging stations, fuel cell vehicle refueling equipment, and zero-emission buses The bill exempts from property tax (1) level two EV charging stations (see § 5) located on commercial or industrial property, (2) EV charging stations located on residential property, (3) refueling equipment for fuel cell electric vehicles, and (4) zero-emission buses (see § 1). 2022SB-00004-R000406-BA.DOCX Researcher: HP Page 11 4/11/22 EFFECTIVE DATE: October 1, 2022, and applicable to assessment years starting on or after that date. §§ 7 & 11 — CHEAPR PROGRA M AND GHG REDUCTION FEE Makes numerous changes to the CHEAPR program, including making the CHEAPR board advisory-only, modifying the board’s membership, giving priority to low-income individuals and residents of environmental justice communities, and extending eligibility to businesses, municipalities, nonprofits, and e-bikes; directs all of the GHG reduction fee to the CHEAPR program The bill makes numerous changes to the CHEAPR program, some of which correspond to agency practice. Under current law, the CHEAPR board is responsible for the program’s administration. The bill (1) requires DEEP to administer the program; (2) makes the CHEAPR board advisory, responsible for advising the DEEP commissioner on priorities for allocating, distributing, and using CHEAPR funds; and (3) eliminates the program’s sunset date (December 31, 2025), thereby making the program permanent. The bill modifies the program parameters for the vehicle rebates and adds a component for electric bicycles (e-bikes). For both components, the bill allows the program to offer rebates or vouchers (“incentives”). The bill also increases program funding by transferring the entirety of the greenhouse gas reduction fee to the CHEAPR account to be used for the program. Current law transfers only the first $3 million collected from the fee, with the remainder going to the General Fund. By law, the fee is (1) $15 for the registration of a new vehicle and (2) generally $7.50 for new registrations and registration renewals. Advisory Board The bill modifies the CHEAPR board’s membership. First, it adds the Public Utilities Regulatory Authority chairperson, or her designee, as an ex-officio member. As under existing law, the other ex-officio members are the DEEP commissioner, the consumer protection commissioner, and the Green Bank president (or their designees). The bill also (1) increases the number of appointed members from six to 10 by adding appointments for the Transportation Committee leaders and (2) specifies qualifications for some existing members, as shown in 2022SB-00004-R000406-BA.DOCX Researcher: HP Page 12 4/11/22 Table 1. Table 1: CHEAPR Board Appointing Authorities and Qualifications Appointing Authority Qualification House speaker* Representative of an environmental organization knowledgeable in EV policy* Senate president pro tempore* Representative of an association representing EV manufacturers House majority leader* Representative of an organization representing an environmental justice community* Senate majority leader* Representative of an automotive retailers’ association* House minority leader* Representative of an EV consumer association Senate minority leader* None specified* Transportation Committee House chairperson Representative of an organization promoting walking or bicycling Transportation Committee Senate chairperson None specified Transportation Committee House ranking member Owner or manager of bicycle sale or repair business Transportation Committee Senate ranking member None specified *Existing appointment/qualification The bill allows the advisory board to establish rules governing its internal procedures. Vehicle Incentive Component Eligible Vehicles. Under the bill, the CHEAPR program provides incentives to state residents who purchase battery electric vehicles (BEVs), plug-in hybrid electric vehicles (PHEVs), or fuel cell electric vehicles (FCEVs). The bill makes hydrogen vehicles ineligible for incentives. This conforms to current program practice. Additionally, the bill sets the maximum base manufacturer’s suggested retail price (MSRP) for a vehicle to be eligible for an incentive at $50,000, which applies from July 1, 2022, to June 30, 2027. Current law does not impose an MSRP cap, but under current program practice, the MSRP cap is $42,000 for BEVs and PHEVs and $60,000 for FCEVs. 2022SB-00004-R000406-BA.DOCX Researcher: HP Page 13 4/11/22 Eligible Entities. Under current law, only individuals qualify for incentives through CHEAPR. The bill extends eligibility for incentives to in-state municipalities, businesses, nonprofits, and tribal entities. It limits these entities to 10 incentives per year, within available funds, and 20 incentives total. But it allows DEEP to issue additional incentives to eligible businesses or nonprofits that operate fleets exclusively in environmental justice communities (see BACKGROUND). Incentive Amounts and Income Eligibility. The bill generally makes DEEP responsible for establishing and revising incentive amounts, with the advisory board’s advice, but requires the rebate for residents of environmental justice communities to be at least $5,000. Under current law, the board establishes rebate amounts. The bill requires the DEEP commissioner to prioritize granting incentives to residents (1) of environmental justice communities; (2) with household incomes at or below 300% of the federal poverty level; or (3) who participate in state and federal assistance programs such as the Supplemental Nutrition Assistance Program, Low Income Home Energy Assistance Program, Head Start, and Operation Fuel. Under current agency practice, participants in certain income-qualified programs are eligible for higher rebates. E-Bike Incentive Component The bill requires the DEEP commissioner to provide incentives through the CHEAPR program for state residents to purchase e-bikes. As with the vehicle component, the commissioner is generally responsible for determining incentive amounts, except that the incentive must be at least $500. The bill also requires DEEP, in consultation with the advisory board, to determine the maximum income eligibility for e- bike incentives. The e-bike component must be designed to maximize air quality benefits associated with e-bike use and prioritize granting incentives to residents (1) of environmental justice communities; (2) with household incomes at or below 300% of the federal poverty level; or (3) who participate in state and federal assistance programs such as the 2022SB-00004-R000406-BA.DOCX Researcher: HP Page 14 4/11/22 Supplemental Nutrition Assistance Program, Low Income Home Energy Assistance Program, Head Start, and Operation Fuel. Under the bill, from July 1, 2022, to June 30, 2027, an e-bike must have a base MSRP of $3,000 or less to be eligible for a program incentive. Reporting The bill requires DEEP, rather than the CHEAPR board, to annually evaluate the program. It also requires that DEEP report annually, starting by June 20, 2024, to the Transportation and Environment committees on the program’s status and effectiveness. The report must include information on program participation and the environmental benefits accruing to environmental justice communities and communities overburdened by air pollution. Outreach and Marketing Under the bill, DEEP must conduct outreach programs and implement a marketing campaign to promote CHEAPR. EFFECTIVE DATE: Upon passage for the changes to the CHEAPR program. §§ 8 & 20 — EV REGISTRATION FEE Eliminates the reduced registration fee for electric vehicles The bill eliminates the reduced registration fee for EVs ($57 for a triennial period) and instead subjects them to the same registration fee that applies to other passenger motor vehicles (e.g., $120 for triennial period). §§ 9 & 10 — CLEAN AIR ACT (CAA) FEE Requires CAA fee revenue to be placed in dedicated accounts within the General Fund and the Special Transportation Fund and used for clean air and clean transportation expenses Current law requires that federal CAA fees (see BACKGROUND) collected on motor vehicle registrations be split between the General Fund (42.5%) and the Special Transportation Fund (STF) (57.5%) and does not dedicate these fees to any specific purpose. The bill keeps the fee division, but instead directs the revenue to 2022SB-00004-R000406-BA.DOCX Researcher: HP Page 15 4/11/22 dedicated accounts, specifically the (1) federal clean air act (CCA) account in the General Fund and (2) reduce transportation-related greenhouse gases (GHG) account in the STF. The bill establishes these accounts as nonlapsing accounts within the respective funds and requires all money the law directs to the accounts to be deposited in them. Under the bill, funds in the federal CAA account must be spent by DEEP, in consultation with DOT, to implement federal CAA requirements, improve air quality, and reduce carbon emissions. Funds in the reduce transportation-related GHG account must be spent by the DOT commissioner on transportation-related expenditures to reduce transportation-related GHG. §§ 12 & 13 — TRAFFIC SIGNAL GRANT PROGRAM Requires DOT to establish a matching grant program to help municipalities modernize existing traffic signal equipment and authorizes $75 million in bonds for that purpose The bill requires DOT to establish a matching grant program to help municipalities modernize existing traffic signal equipment and operations to make them (1) capable of using transit signal priority, (2) responsive to congestion, and (3) reduce idling. It authorizes $75 million in general obligation (GO) bonds for the program, which are subject to standard statutory bond issuance procedures and repayment requirements. Under the bill, applications must be submitted annually to the DOT commissioner when, and in the way, he requires. The commissioner must (1) develop eligibility criteria for program participation, (2) determine the matching amount required, (3) give preference to applications submitted by two or more municipalities, and (4) establish incentives for regional projects. EFFECTIVE DATE: The provision requiring DOT to establish the program is effective upon passage. §§ 14 & 19 — MEDIUM AND HEAVY -DUTY TRUCK VOUCHERS Allows DEEP to establish a voucher program to support the use of zero-emission medium- and heavy- duty vehicles and appropriates $15 million to fund the program 2022SB-00004-R000406-BA.DOCX Researcher: HP Page 16 4/11/22 Beginning January 1, 2023, the bill allows DEEP, within available funds, to establish a voucher program to support the use of zero- emission (1) vehicles within class 5 to class 13 of the Federal Highway Administration’s (FHWA) vehicle category classification system (see BACKGROUND) and (2) school buses within class 3 to class 8 of the system. The DEEP commissioner must consult with the education, motor vehicles, and transportation commissioners in establishing the program. The bill also establishes a medium and heavy-duty vehicle voucher account as a separate, nonlapsing General Fund account. It appropriates $15 million to the account in FY 23. The account must contain any money the law requires be deposited into it, and its funds must be used by DEEP for the voucher program. Under the bill, eligible technology for vouchers includes battery electric and fuel cell systems and electric vehicle charging infrastructure. Vouchers may not be awarded for vehicle classes where there is no commercially available zero-emission technology. DEEP must set aside 40% of available funding to maximize air pollution reduction in environmental justice communities (see BACKGROUND). EFFECTIVE DATE: The provision requiring DEEP to establish the program and creating the account is effective upon passage. §§ 15-17 — ZERO-EMISSION SCHOOL BUSES Allows for 10-year school transportation contracts if the contract includes at least one zero-emission bus, sets targets for converting school buses to zero-emission buses, and establishes a matching grant program for zero-emission school buses and charging infrastructure School Bus Contracts Under current law, local and regional boards of education may enter into contracts for student transportation for a maximum term of five years. The bill allows them to have contracts with up to ten-year terms if the contract includes transportation provided by at least one school bus that is a zero-emission bus. (A “zero-emission bus” is an urban bus certified by the California Air Resources Board’s executive director as producing zero emissions of any criteria pollutant under all operational 2022SB-00004-R000406-BA.DOCX Researcher: HP Page 17 4/11/22 modes and conditions.) Transition to Zero-Emission School Buses The bill requires that all school buses be zero-emission buses by (1) January 1, 2030, in school districts in environmental justice communities (see BACKGROUND) and (2) January 1, 2035, in the remaining districts. Grant Program The bill requires DEEP to establish and administer a grant program to provide matching funds necessary for municipalities, school districts, and school bus operators to submit federal grant applications and maximize federal funding to buy or lease zero-emission buses and EV charging infrastructure. It authorizes $20 million in GO bonds to fund the program, which are subject to standard statutory bond issuance procedures and repayment requirements. Applications must be filed when and how the commissioner determines, and DEEP must determine the matching amount that applicants must provide. The bill requires DEEP to give preference to applications to purchase or lease zero-emission buses that will operate primarily in an environmental justice community. Technical Assistance The bill requires DEEP, within available appropriations, to provide administrative and technical assistance to municipalities, school districts, and school bus operators that apply for federal grants for zero- emission buses and EV charging infrastructure. EFFECTIVE DATE: The provision on school bus contracts is effective October 1, 2022. § 18 — STATE CARBON BUDGET Requires DOT, in consultation with DEEP, to annually establish a transportation carbon budget and adopt implementing regulations to ensure that transportation projects adhere to the budget Starting by July 1, 2024, the bill requires DOT, in consultation with DEEP, to annually establish a transportation carbon budget for the state that sets the maximum amount of GHG emissions permitted from the 2022SB-00004-R000406-BA.DOCX Researcher: HP Page 18 4/11/22 transportation sector. When setting the budget, the agencies must consider the state’s long-term emissions reductions required under existing law. Under the bill, DOT must adopt regulations to ensure state, regional, and municipal transportation projects adhere to the carbon budget. The regulations must include: 1. a definition of “transportation project” that excludes projects necessary for maintenance or safety; 2. a methodology to calculate the GHG emissions expected from future projects; 3. ways to offset the emissions for projects estimated to increase net emissions by undertaking GHG mitigation transportation projects that will reduce emissions; and 4. a description of the GHG mitigation projects, such as public transportation improvement, bikeway, walkway, or other trail or path construction, and EV charging installation. DOT must, in consultation with DEEP, implement a public outreach plan to sufficiently engage the public and stakeholders in developing the carbon budget and associated regulations. The DOT commissioner must submit the regulations to the Regulations Review Committee by July 1, 2024. Starting by February 1, 2025, DOT must annually submit to the Transportation and Environment committees a (1) copy of the transportation carbon budget and (2) description of the public outreach conducted and its results. EFFECTIVE DATE: October 1, 2022 BACKGROUND School Building Project By law, a “school building project” includes the following: 2022SB-00004-R000406-BA.DOCX Researcher: HP Page 19 4/11/22 1. construction, purchase, extension, replacement, renovation, or major alteration of a building to be used for public school purposes, including equipping and furnishing the construction, purchase, extension, replacement, renovation or major alteration, the improvement of land, or the improvement of the site of an existing building for public school purposes; 2. construction, including equipping and furnishing construction, of any building which the towns of Norwich, Winchester, and Woodstock may provide by lease or otherwise for use by the Norwich Free Academy, Gilbert School, and Woodstock Academy, respectively, to provide education for public school students; and 3. addition to, renovation of, and associated equipping and furnishing, of any building which may be leased, upon the approval of the education and DAS commissioners, to any local or regional board of education for a term of twenty years or more to provide education for public school students (CGS § 10-282). Environmental Justice Communities By law, an “environmental justice community” is (a) any U.S. census block group, as determined by the most recent census, for which at least 30% of the population consists of low-income people who are not institutionalized and have an income below 200% of the federal poverty level or (b) a distressed municipality (CGS § 22a-20a). The Department of Economic and Community Development annually designates distressed municipalities, based on high unemployment and poverty, aging housing stock, and low or declining rates of job, population, and per capita income growth (CGS § 32-9p). The current (2021) distressed municipalities are Ansonia, Bridgeport, Chaplin, Derby, East Hartford, East Haven, Griswold, Groton, Hartford, Meriden, Montville, New Britain, New London, Norwich, Plainfield, Putnam, Sprague, Sterling, Stratford, Torrington, Voluntown, Waterbury, West Haven, Winchester, and Windham. 2022SB-00004-R000406-BA.DOCX Researcher: HP Page 20 4/11/22 Towns with current designated census blocks (that are not also distressed municipalities) are Barkhamsted, Bethel, Bloomfield, Branford, Bristol, Brooklyn, Clinton, Colchester, Cromwell, Danbury, East Hampton, East Lyme, Ellington, Enfield, Essex, Fairfield, Farmington, Greenwich, Haddam, Hamden, Killingly, Killingworth, Ledyard, Manchester, Mansfield, Marlborough, Middletown, Milford, Naugatuck, New Fairfield, New Haven, New Milford, North Canaan, North Stonington, Norwalk, Old Saybrook, Plainville, Portland, Preston, Ridgefield, Rocky Hill, Sharon, Shelton, Simsbury, Southbury, Southington, Stafford, Stamford, Stonington, Thomaston, Thompson, Vernon, Wallingford, Waterford, W atertown, West Hartford, Westbrook, Wethersfield, Willington, Windsor Locks, and Windsor. CAA Fees on Motor Vehicle Registrations State law requires the Department of Motor Vehicles to collect the CAA fee on new registrations and renewals and sets the fee at $15 for a triennial registration period (proportionately reduced for other registration lengths). By law, the CAA fee does not apply to motor vehicles that are electrically powered, not self-propelled, or exempt from a registration fee (CGS § 14-49b(a)). FHWA Vehicle Category Classification System The FHWA vehicle category classification systems sorts vehicles into different classes based on their characteristics, as shown in the table below. Class Vehicles Class Vehicles 1 Motorcycles 8 Single trailer, 3- or 4-axle trucks 2 Passenger cars 9 Single trailer, 5-axle trucks 3 Pickups, panels, and vans 10 Single trailer, 6+ axle trucks 4 Buses 11 Multi-trailer, 5 or fewer axle trucks 5 Single unit, 2-axle trucks 12 Multi-trailer, 6-axle trucks 6 Single unit, 3-axle trucks 13 Multi-trailer, 7+ axle trucks 7 Single unit, 4+ axle trucks Related Bill HB 5381 (File 299), favorably reported by the Transportation Committee, contains identical provisions directing the General Fund 2022SB-00004-R000406-BA.DOCX Researcher: HP Page 21 4/11/22 portion of the CAA to a dedicated account to be used for clean air purposes. COMMITTEE ACTION Transportation Committee Joint Favorable Substitute Yea 23 Nay 11 (03/24/2022)