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California Air Pollution Control Laws

HEALTH AND SAFETY CODE

Division 26 Air Resources

Part 3 Air Pollution Control Districts

Chapter 6 General Powers and Duties

§ 40709. Establishment of offset system

(a) Every district board shall establish by regulation a system by which all reductions in the emission of air contaminants that are to be used to offset certain future increases in the emission of air contaminants shall be banked prior to use to offset future increases in emissions. The system shall provide that only those reductions in the emission of air contaminants that are not otherwise required by any federal, state, or district law, rule, order, permit, or regulation shall be registered, certified, or otherwise approved by the district air pollution control officer before they may be banked and used to offset future increases in the emission of air contaminants. The system shall be subject to disapproval by the state board pursuant to Chapter 1 (commencing with Section 41500) of Part 4 within 60 days after adoption by the district.

(b) The system is not intended to recognize any preexisting right to emit air contaminants, but to provide a mechanism for districts to recognize the existence of reductions of air contaminants that can be used as offsets, and to provide greater certainty that the offsets shall be available for emitting industries.

(c) Notwithstanding subdivision (a), emissions reductions proposed to offset simultaneous emissions increases within the same stationary source need not be banked prior to use as offsets, if those reductions satisfy all criteria established by regulation pursuant to subdivision (a).

(d) This section does not apply to any district that is not required to prepare and submit a plan for attainment of state ambient air quality standards pursuant to Section 40911 if both of the following apply to the district:

(1) The district is not in a federal nonattainment area for any national ambient air quality standard unless the sole reason for the nonattainment is due to air pollutant transport.

(2) An owner or operator of a source or proposed source has not petitioned the district to establish a banking system.

Added Stats 1979 ch 1111 § 1. Amended Stats 1992 ch 612 § 2 (AB 3785); Stats 2000 ch 729 § 5 (SB 1300).

Amendments:

1992 Amendment: In addition to making technical changes, (1) added subdivision designations (a) and (b); (2) amended subd (a) by (a) substituting “all” for “certain” after “system by which”; (b) substituting “which are to be” for “may be banked and” after “air contaminants”; (c) adding “shall be banked prior to use to offset future increases in emissions”; and (d) deleting “of this division” after “Part 4”; and (3) added subd (c)

2000 Amendment: (1) Amended subd (a) by (a) substituting “that are to be used” for “which are to be used” in the first sentence; (b) substituting “that are not otherwise” for “which are not otherwise” in the second sentence; and (2) added subd (d).

Cross References: Air contaminant: H & S C § 39013.

Certificate evidencing approved reductions in emissions: H & S C § 40710.

Registration and transfer of interests and approved emission reductions: H & S C § 40711.

Title to approved emission reductions: H & S C § 40712.

Procedures: H & S C § 40713.

Filing of financing statement not required to perfect security interest: UCC § 9302 subd (3)(d).

Collateral References: 4 Witkin Summary (10th ed) Secured Transactions in Personal Property § 66.

Law Review Articles:

Review of Selected 1979 California Legislation. 11 Pacific LJ 521.

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