As a result of the defeat of Proposition 15 late last year, California counties and various other government agencies continue to search for ways to increase revenues. One of the most recent proposals comes from the South Coast Air Quality Management District (SCAQMD) to implement a fee or tax to reduce emissions on warehouses more than 100,000 square feet located in Los Angeles, Orange, Riverside, and San Bernardino counties. This has raised concern for property owners, as it will be implemented on top of California’s AB32 filing requirements and fees and is viewed by many as unrealistic. The formal proposal by SCAQMD is as follows:
Proposed Rule 2305 will require warehouses greater than 100,000 square feet to directly reduce NOx and diesel PM, or to facilitate emission and exposure reductions of these pollutants. The Warehouse Actions and Investments to Reduce Emissions (WAIRE) Program is a menu-based points system that will require warehouse operators to annually earn a specified number of points by completing actions from a menu. Menu items include acquiring or using: Near Zero Emissions (NZE) and/or Zero Emissions (ZE) on-road trucks, ZE cargo handling equipment, ZE charging/fueling infrastructure, solar panels, or particulate filters for nearby sensitive land uses. Alternatively, warehouse operators could prepare and implement a custom plan specific to their site, or they could pay a mitigation fee. Funds from the mitigation fee would be used through future solicitations and Board actions to incentivize the purchase of NZE or ZE trucks and ZE charging/fueling infrastructure in the communities near warehouses that paid the fee. Warehouse owners and operators would also have reporting and recordkeeping requirements. Proposed Rule 316 would establish fees for warehouse operators to fund South Coast AQMD compliance activities.
This action is to:
1) Adopt the Resolution:
A) Certifying the Final Environmental Assessment for Proposed Rule 2305 - Warehouse Indirect Source Rule - Warehouse Actions and Investments to Reduce Emissions Program and Proposed Rule 316 - Fees for Rule 2305;
B) Adopting Proposed Rule 2305 - Warehouse Indirect Source Rule - Warehouse Actions and Investments to Reduce Emissions Program and Proposed Rule 316 - Fees for Rule 2305;
C) Submitting Proposed Rule 2305 - Warehouse Indirect Source Rule - Warehouse Actions and Investments to Reduce Emissions Program for inclusion into the SIP;
2) Establish the Rule 2305 Mitigation Fee Alternate Compliance Fund;
3) Authorize the Executive Officer to recognize upon receipt mitigation fees paid by warehouse operators into the Rule 2305 Mitigation Fee Alternate Compliance Fund.
The SCAQMD Board of Governors will consider adoption of these proposed rules at a public hearing on May 7, 2021 and will target more than 3,000 warehouses in Southern California. Those taxpayers who may be affected can find additional details and meeting registration information here.
TECHNICAL INFORMATION CONTACTS:
Susan Orloff
Principal
Ryan
818.500.0995
susan.orloff@ryan.com
Mike Brennan
Director
Ryan
442.244.2414
mike.brennan@ryan.com
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