SACAQMD RULE 204 EMISSION REDUCTION CREDITS          
LAST REVISED 12/15/92          

          SACRAMENTO METROPOLITAN AQMD                RULES AND REGULATIONS
                         RULE 204 EMISSION REDUCTION CREDITS
                                         Adopted 12-15-92

                                              INDEX

          100  GENERAL
               101 PURPOSE
               102 APPLICABILITY
               110 EXEMPTION: NOTIFICATION REQUIREMENTS
               111 EXEMPTION: RACT ADJUSTMENT
               112 EXEMPTION: SHUTDOWNS AND CURTAILMENTS

          200  DEFINITIONS
               201 ACTUAL EMISSION REDUCTIONS
               202 BANKING
               203 CERTIFIED
               204 ELECTRICAL POWER PLANTS
               205 EMISSION REDUCTION CREDITS
               206 EMISSIONS UNIT
               207 ENFORCEABLE
               208 ERC CERTIFICATE
               209 HISTORIC ACTUAL EMISSIONS
               210 NON-PERMITTED EMISSIONS
               211 OFFSET
               212 PERMANENT
               213 PORTABLE EQUIPMENT
               214 PROJECTED EMISSIONS
               215 QUANTIFIABLE
               216 QUARTERLY
               217 REAL
               218 REASONABLY AVAILABLE CONTROL TECHNOLOGY
               219 REGISTER
               220 REPLACEMENT EQUIPMENT
               221 SHUTDOWN
               222 TEMPORARY
               223 TEMPORARY ACTUAL EMISSION REDUCTIONS
               224 TRANSFER

          300  STANDARDS
               301 CERTIFICATION
               302 REEVALUATION
               303 NON-PERMITTED SOURCES
               304 SHUTDOWNS
               305 USE OF ERC'S: BANKING
               306 USE OF ERC'S: OFFSETS
               307 RETURNS:  USE  OF ERC'S FOR TEMPORARY STATIONARY SOURCES
                   AND PORTABLE EQUIPMENT
               308 RETURNS: ISSUANCE OF PERMIT TO OPERATE
               309 RETURNS: USE OF ERC'S FOR ELECTRICAL POWER PLANTS

          400  ADMINISTRATIVE REQUIREMENTS
               401 COMPLETE APPLICATION
               402 PRELIMINARY DECISION
               403 PUBLICATION AND PUBLIC COMMENT
               404 PUBLIC INSPECTION
               405 CERTIFICATION, FINAL ACTION
          400  ADMINISTRATIVE REQUIREMENTS, cont.
               406 WITHDRAWAL OF APPLICATION
               407 CALCULATION OF EMISSIONS
               408 CONVERSION OF AIR EMISSION REDUCTIONS TO ERCs
               409 REGISTRATION
               410 ERC REGISTER
               411 MORATORIUM

          500  MONITORING AND RECORDS (NOT INCLUDED)
          
          100  GENERAL

               101 PURPOSE:  To provide  an  administrative  mechanism  for
                   quantifying,  adjusting  and certifying surplus emission
                   reductions for:
                   101.1 later use as offsets  pursuant  to District, state
                         or federal rules or regulations,
                   101.2 transfer to other sources as offsets  pursuant  to
                         Rule 202, NEW SOURCE REVIEW, or

               102 APPLICABILITY:  This  rule  shall apply to all emissions
                   reduction credits for use within  a stationary source or
                   for transfer to other sources.

               110 EXEMPTION: NOTIFICATION REQUIREMENTS:  The  requirements
                   of  Sections  403  and  404;  relating  to notification,
                   publication,   and   public  inspection  of  Preliminary
                   Decisions; shall not apply  if  the  application  is for
                   emission reduction credits of: less than 9000 pounds per
                   quarter  of nitrogen oxides, reactive organic compounds,
                   or sulfur  oxides;  7200  pounds per quarter of PM10; or
                   49,500 pounds per quarter of carbon monoxide.

               111 EXEMPTION: RACT ADJUSTMENT:  The  provisions  of Section
                   407.4 shall not apply to those emission reductions  that
                   occurred prior to February 26, 1991.

               112 EXEMPTION:  SHUTDOWNS  AND CURTAILMENTS : The provisions
                   of Section 201.4a and 304.3  shall not apply to emission
                   reduction   credits  from  shutdowns   or   curtailments
                   provided:
                   112.1 The shutdowns  or curtailment occur after December
                         31, 1987, or
                   112.2 The shutdowns or  curtailments  are  documented in
                         District permitting actions pursuant to  Rule 202,
                         NEW SOURCE REVIEW, and
                   112.3 The  emissions  from  the  emissions  unit  to  be
                         shutdown   or   curtailed   are  included  in  the
                         District's 1987 emission inventory, and
                   112.4 The District is notified before  February 13, 1993
                         of  shutdowns  and  curtailments  which   occurred
                         before December 15, 1992.

               113 EXEMPTION:  MOBILE  AND  TRANSPORTATION  SOURCE EMISSION
                   REDUCTION  CREDITS:   The  provisions  of  Section  407,
                   Calculation  of  Emissions, shall not apply to  emission
                   reduction credits  obtained pursuant to Rule 206, MOBILE
                   AND TRANSPORTATION SOURCE EMISSION REDUCTION CREDITS.

          200  DEFINITIONS: Unless otherwise  defined below, the terms used
               in this rule are defined in Rule 202, NEW SOURCE REVIEW.

               201 ACTUAL  EMISSIONS REDUCTIONS:  Reductions  of  emissions
                   from  an emissions  unit.   Actual  emission  reductions
                   shall be calculated pursuant to Section 407, Calculation
                   of Emissions and meet all of the following criteria:
                   201.1 The    emissions   reductions   shall   be   real,
                         enforceable, quantifiable, and permanent.
                   201.2 The  emissions   reductions   shall   be   surplus
                         emissions  reductions  in  excess of any emissions
                         reduction which is:
                         a.   required or encumbered  by  any  laws, rules,
                              regulations,   agreements,  or  orders,   and
                              unless such law  by its terms states that the
                              emission  reduction   shall   be   considered
                              surplus, or
                         b.   attributed  to a control measure noticed  for
                              workshop  in the  District,  or  proposed  or
                              contained in a State Implementation Plan, or
                         c.   proposed or  contained  as near-term measures
                              in the District Air Quality  Attainment  Plan
                              for  attaining the annual reductions required
                              by the  California  Clean Air Act.  Temporary
                              actual emissions reductions may be granted if
                              they meet all the requirements  of this rule,
                              except that they are not permanent, and shall
                              cease to exist as temporary actual  emissions
                              reductions  upon implementation of the  near-
                              term control measure.
                   201.3 Emissions  reductions  attributed  to  a  proposed
                         control measure  may  be  re-eligible as a surplus
                         actual emissions reductions for:
                         a.   control measures identified  in  the District
                              Air   Quality   Attainment   Plan   or  State
                              Implementation  Plan  where no rule has  been
                              adopted within two years  from  the scheduled
                              adoption  date,  provided, however,  the  Air
                              Pollution Control  Officer  has  not extended
                              the scheduled adoption date, or
                         b.   control   measures  not  identified  in   the
                              District Air Quality Attainment Plan or State
                              Implementation  Plan  where  no rule has been
                              adopted and two years have elapsed beyond the
                              date of the latest public workshop notice, or
                         c.   control measures proposed in the District Air
                              Quality   Attainment  Plan  which   are   not
                              included  into   the   Plan  adopted  by  the
                              District Board shall become  re-eligible upon
                              adoption of the Plan.
                   201.4 Source shutdowns and curtailments may not be given
                         emission   reduction   credit   in  the  case   of
                         non-attainment pollutants if they  occurred  prior
                         to the date of application unless:
                         a.   The  shutdown  or  curtailment was claimed by
                              the affected facility  as  a credit within 60
                              days of the surrender of the permit(s), or in
                              the case of non-permitted sources  within  60
                              days  of  the last date of operation.  In the
                              case of emission  reductions  associated with
                              the elimination of agricultural  burning, the
                              shutdown  or  curtailment  credit  shall   be
                              claimed  within  12 months of the last day of
                              operation.  A letter  of  intent to apply may
                              be   provided   by  the  affected   facility.
                              Shutdown or curtailment  credits  not claimed
                              within  60  days  shall pass to the Community
                              Bank  as provided in  Rule  202,  NEW  SOURCE
                              REVIEW, and
                         b.   The proposed  new source or modification is a
                              replacement, and  the shutdown or curtailment
                              occurred after August 7, 1977, or
                         c.   The proposed new source  or modification does
                              not meet the EPA definition of a major source
                              or major modification, and  the  shutdown  or
                              curtailment  occurred  after  August 7, 1977,
                              and the emission reduction credit  is used at
                              the same stationary source.

               202 BANKING:   The   system   of   quantifying,   adjusting,
                   certifying, recording, and storing ERC's for future  use
                   and  transfer.  This system shall be called the Emission
                   Reduction Credit Bank (ERC Bank).

               203 CERTIFIED:  Emission  reduction  credits which have been
                   evaluated under the requirements of  this rule and other
                   applicable  District,  state  and  federal   rules   and
                   regulations  and  which  have been authorized by the Air
                   Pollution Control Officer.

               204 ELECTRICAL  POWER  PLANTS:  An   electrical   generating
                   facility  located  within  the  District  that regularly
                   generates electricity so the local electric  utility can
                   provide   its   daily  energy  requirements.   Emergency
                   electrical  generating   equipment  are  not  considered
                   electrical power plants.

               205 EMISSION REDUCTION CREDITS  (ERC):  Reductions of actual
                   emissions from an emission unit that are registered with
                   the District in accordance with the requirements of this
                   rule.

               206 EMISSIONS UNIT: An identifiable operation  or  piece  of
                   process  equipment such as an article, machine, or other
                   contrivance  which controls, emits, may emit, or results
                   in the emissions  of  any affected pollutant directly or
                   as fugitive emissions.   For  the purpose of calculating
                   emission  reduction  credits  pursuant   to  this  rule,
                   emissions unit shall include agricultural burning.

               207 ENFORCEABLE: Verifiable and legally binding.

               208 ERC  CERTIFICATE:  A  document  certifying  title  to  a
                   defined  quantity  and  type  of  ERC's  issued  by  the
                   District to the owner(s) identified on the Certificate.

               209 HISTORIC  ACTUAL  EMISSIONS:  Actual  emissions  for the
                   existing  emissions  unit  averaged  over  the  two year
                   period immediately preceding the date of application for
                   emission  reduction credits.  If the last two years  are
                   unrepresentative   of   normal   source   operations  as
                   determined  by  the Air Pollution Control Officer,  then
                   any two consecutive  years  of  the last five years that
                   represent normal source operation  may  be used.  If, at
                   any  time  during the two year period, actual  emissions
                   exceeded allowed  or  permitted  emission  levels,  then
                   actual  emissions  shall  be reduced to reflect emission
                   levels that would have occurred  if  the  unit  were  in
                   compliance  with  all  applicable limitations and rules.
                   If  less than one year has  passed  since  the  date  of
                   issuance  of  the  permit  to  operate then the historic
                   actual emissions shall be zero.   If less than two years
                   have passed since the date of issuance  of the permit to
                   operate then the historic actual emissions  shall be the
                   actual  emissions  over  the one year period immediately
                   preceding the date of application.

               210 NON-PERMITTED EMISSIONS: Those  emissions of an affected
                   pollutant  which are not required  to  obtain  a  permit
                   pursuant to Rule 201, GENERAL PERMIT REQUIREMENTS.  Non-
                   permitted emissions  may  include  emissions from mobile
                   sources, indirect sources, and exempt equipment.

               211 OFFSET:  The  use  of  an emission reduction  credit  to
                   compensate  for  an emission  increase  of  an  affected
                   pollutant from a new  or  modified source subject to the
                   requirements of Rule 202, NEW SOURCE REVIEW.

               212 PERMANENT: The sum of all ERC's  endures for the life of
                   the project utilizing that sum of ERC's.

               213 PORTABLE  EQUIPMENT:  Equipment  which  is  periodically
                   relocated and is not operated more  than  a total of 180
                   days  at  any one location in the District within  a  12
                   month period.

               214 PROJECTED EMISSIONS:  Emissions  for  a calendar quarter
                   based on the same operating characteristics  (e.g.  fuel
                   consumption,  production  level, throughput) as historic
                   actual  emissions for the calendar  quarter.   Projected
                   emissions  shall  be  adjusted  for  applicant  proposed
                   emission   reduction   strategies  (such  as  throughput
                   reductions,  shutdowns,  and   reductions  in  operating
                   hours) which reduce emissions to  a level below historic
                   actual emissions, including emission controls, which are
                   contained  as conditions of the authority  to  construct
                   and permit to  operate.   Such adjustments shall only be
                   made to the extent that the  emission  reduction credits
                   generated  are  allowed  by  all  applicable  rules  and
                   regulations.   In cases where the modification  includes
                   an  increase  in the  allowed  throughput  or  capacity,
                   projected emissions  shall  be  the  potential  to  emit
                   pursuant  to  Rule  202,  NEW  SOURCE REVIEW, instead of
                   historic actual emissions.

               215 QUANTIFIABLE: Ability to estimate emission reductions in
                   terms  of  their amount and characteristics.   The  same
                   method of estimating  emissions should generally be used
                   to quantify the emission  levels  before  and  after the
                   reduction.

               216 QUARTERLY: Calendar quarter beginning in January, April,
                   July, and October.

               217 REAL:   Actually   occurring,   implemented,   and   not
                   artificially devised.

               218 REASONABLY  AVAILABLE  CONTROL  TECHNOLOGY  (RACT):  The
                   lowest  emission  limitation that a particular source is
                   capable  of  meeting  by  the  application  of  emission
                   control  technology   that   is   reasonably   available
                   considering  technical  and  economic feasibility.   The
                   criteria for RACT are specified in "California Clean Air
                   Act  Guidance  for  the  Determination   of   Reasonably
                   Available Control Technology and Best Available Retrofit
                   Control  Technology",  California  Air  Resources Board,
                   April 1990.

               219 REGISTER:  The  document that records all ERC  deposits,
                   withdrawals, transfers, and transactions.

               220 REPLACEMENT EQUIPMENT:  A  replacement  of  a  piece  of
                   equipment with an identical piece of equipment which has
                   a potential to emit less than or equal to those from the
                   original piece of equipment.

               221 SHUTDOWN:   The  permanent  cessation  of  an  emissions
                   generating activity.

               222 TEMPORARY: A  stationary  source or emissions unit which
                   operates  no longer than one  consecutive  twelve  month
                   period.

               223 TEMPORARY ACTUAL  EMISSION  REDUCTIONS:  Actual emission
                   reductions  registered  with the District in  accordance
                   with the requirements of  this rule which is included in
                   a control measure or contained  as  a  near-term measure
                   proposed  in  the District Air Quality Attainment  Plan.
                   The life of the  credit shall end upon implementation of
                   the near-term control measure.

               224 TRANSFER: The change  in  ownership  of  an ERC from one
                   person to another.

          300  STANDARDS

               301 CERTIFICATION: Only actual emission reductions  shall be
                   certified  as  ERC's.   Such  actual emission reductions
                   shall meet the following requirements to be certified as
                   ERC's.
                   301.1 Apply for emission reduction  credits  pursuant to
                         Section 401, and
                   301.2 Receive  written  approval  of  the  Air Pollution
                         Control Officer, and
                   301.3 If  the  emission  reduction  is  created from  an
                         emission unit where the demand for the services or
                         product  could shift to other similar  sources  in
                         the District,  submittal  of data to document that
                         such  reductions  will  result   in  District-wide
                         emission  reductions may be required  by  the  Air
                         Pollution  Control  Officer.   Such  documentation
                         must be approved  by  the  Air  Pollution  Control
                         Officer.

               302 REEVALUATION:   Actual  emission  reductions  calculated
                   prior to (date of  rule  adoption)  shall be reevaluated
                   under the requirements and procedures  specified in this
                   rule.

               303 NON-PERMITTED SOURCES:
                   303.1 Except as provided in Section 303.2, non-permitted
                         emissions  units or stationary sources  requesting
                         emission reduction  credits  from  such  emissions
                         units  shall  void  the  exemption  from Rule 201,
                         GENERAL  PERMIT REQUIREMENTS.  Such sources  shall
                         not operate  such  emissions  unit  or  stationary
                         source  without  first obtaining a permit pursuant
                         to Rule 201, GENERAL PERMIT REQUIREMENTS.
                   303.2 If state or federal  law  prohibits  the  District
                         from  requiring  an  authority  to construct or  a
                         permit  to  operate  pursuant  to  Rule  201,  the
                         applicant  for  emission  reduction credits  shall
                         execute  a legally binding contract  with  one  or
                         more  owner(s)   or   operator(s)   of   the  non-
                         permittable emissions unit that ensures the sum of
                         all   emission  reductions  will  be  provided  in
                         accordance with the requirements of this rule, and
                         will continue  for  the  life  of  the  stationary
                         source using the credits or life of the credits as
                         provided in the application.  Such contract  shall
                         be  filed with the District and, by its terms,  be
                         enforceable by the Air Pollution Control Officer.
               304 SHUTDOWNS:
                   304.1 Applicants  for  emission  reductions  due  to the
                         shutdown  of  permitted or non-permitted emissions
                         units shall demonstrate to the satisfaction of the
                         Air Pollution Control  Officer that such equipment
                         will no longer be operated within the District.
                   304.2 Emission reductions from  the  shutdown  of retail
                         dry cleaners and retail gasoline stations shall be
                         prohibited.
                   304.3 An application for emission reduction credits from
                         the  shutdown  of  emissions  units  or stationary
                         sources  shall  be submitted within 60 days  after
                         the surrender of the permit to operate or for non-
                         permitted sources  the  last  date of operation of
                         such emissions unit or stationary  source,  unless
                         the  applicant has requested an extension of time,
                         in writing  prior to the end of the 60 day period,
                         from the Air  Pollution  Control Officer.  The Air
                         Pollution Control Officer  may  grant an extension
                         of  time not to exceed 90 days.  In  the  case  of
                         emission    reductions    associated    with   the
                         elimination of agricultural burning, the  shutdown
                         or  curtailment credit shall be claimed within  12
                         months of the last day of operation.

               305 USE OF ERC'S: BANKING: ERC's may be banked for later use
                   as offsets.   The name of the user shall be entered into
                   the  Register  for  the  applicable  ERC's.   Except  as
                   provided in Section  307,  308,  and 309, such ERC's may
                   not  be  returned  to the bank following  the  start  of
                   operation of the stationary  source  or  emissions  unit
                   using the ERC as offsets.

               306 USE OF ERC'S: OFFSETS: ERC's may be used immediately  as
                   offsets.   The  ERC  shall  be entered into the Register
                   along with the name of the user.   Except as provided in
                   Sections  307,  308,  and  309, such ERC's  may  not  be
                   returned to the bank following the start of operation of
                   the stationary source or emissions unit using the ERC as
                   offsets.

               307 RETURNS: USE OF ERC'S FOR TEMPORARY  STATIONARY  SOURCES
                   AND  PORTABLE  EQUIPMENT:  ERC's  used  as  offsets  for
                   temporary  stationary sources or emissions units or used
                   as offsets for  portable  equipment shall be returned in
                   full to the owner upon verification  of  shutdown of the
                   temporary stationary source, emissions unit, or portable
                   equipment  by the Air Pollution Control Officer.   ERC's
                   must then be  re-deposited  in  the  Bank and re-entered
                   into the Register by the owner, within 60 days.

               308 RETURNS: ISSUANCE OF PERMIT TO OPERATE: If the applicant
                   for  a  Permit  to  Operate requests a lowering  of  the
                   quarterly emission limitation  as  a result of emissions
                   testing conducted pursuant to an Authority  to Construct
                   demonstrated  achievable by such emissions testing,  the
                   difference in emission  reductions  credits necessary to
                   offset  the  emissions unit pursuant to  Rule  202,  NEW
                   SOURCE REVIEW, shall be re-deposited in the Bank and re-
                   entered into the Register.

               309 RETURNS: USE OF ERC'S FOR ELECTRICAL POWER PLANTS: ERC's
                   may  be  used  at  electrical  power  plants  to  offset
                   emission increases  resulting from increased power plant
                   operation needed to compensate  for reduced operation at
                   other electrical power plant(s) within the District, due
                   to emergency breakdown, pursuant  to Rule 602, EMERGENCY
                   BREAKDOWNS, or regularly scheduled  maintenance.   ERC's
                   shall be returned in full to the owner upon verification
                   of  return  to  normal operation of the using electrical
                   power plant.  ERC's  shall  be  re-deposited in the Bank
                   and re-entered into the Register.   This  Section  shall
                   apply  only  during  the  period from November 1 through
                   February 28 or 29, and shall  be  approved in writing by
                   the Air Pollution Control Officer prior to use.

          400  ADMINISTRATIVE REQUIREMENTS

               401 COMPLETE APPLICATION:
                   401.1 The Air Pollution Control Officer  shall determine
                         whether  the  application for ERC is complete  not
                         later  than  30  days   after   receipt   of   the
                         application  for ERC, or after such longer time as
                         both the applicant  and  the Air Pollution Control
                         Officer  have  agreed  in  writing.   If  the  Air
                         Pollution  Control  Officer  determines  that  the
                         application is not complete, the  applicant  shall
                         be  notified in writing of the decision specifying
                         the   information    required.     If    specified
                         information  is  not  submitted  by  the applicant
                         within  60  days  from  the notification from  the
                         District that the application  is  incomplete, the
                         application shall be automatically canceled unless
                         the applicant has requested an extension  of time,
                         in  writing  and  prior  to  the end of the 60 day
                         period,  from the Air Pollution  Control  Officer.
                         The Air Pollution  Control  Officer  may  grant an
                         extension  of time not to exceed 90 days.  If  the
                         application  is  for  a  shutdown  or  curtailment
                         emission reduction credit, failure to provide  the
                         additional  information  or  failure to request an
                         extension of time shall result  in  those  credits
                         passing  to  the  Community  Bank pursuant to Rule
                         202, NEW SOURCE REVIEW.
                   401.2 Upon   receipt   of   any  re-submittal   of   the
                         application,  a  new 30-day  period  to  determine
                         completeness shall begin.
                   401.3 Completeness  of an  application  or  re-submitted
                         application shall be evaluated on the basis of the
                         information requirements  set  forth  in  District
                         regulations (adopted pursuant to Article 3,  65940
                         through  65944  of  Chapter  4.5  of Division l of
                         Title 7 of the California Government Code) as they
                         exist  on  the  date  on which the application  or
                         re-submitted application  was  received.   The Air
                         Pollution   Control   Officer   may,   during  the
                         processing   of   the   application,   request  an
                         applicant   to   clarify,  amplify,  correct,   or
                         otherwise supplement  the information submitted in
                         the application.
                   401.4 A  fee shall be required  pursuant  to  Rule  301,
                         PERMIT FEES - STATIONARY SOURCE.
                   401.5 For offsets provided in accordance with Health and
                         Safety  Code  Sections 41605.5, 42314.5, and 41865
                         concerning emission  reductions  from  open  field
                         burning,  an  ERC  application  covering the total
                         emission reductions necessary to offset stationary
                         source emissions may be submitted  at  the time of
                         application   for   an   Authority  to  Construct.
                         Applications for ERC's from  agricultural  burning
                         shall  not  be  required  if  such  emissions  are
                         covered  by  an  ERC  obtained  by  the stationary
                         source utilizing such emission reductions.

               402 PRELIMINARY  DECISION:   Except  as provided in  Section
                   110, following acceptance of an application as complete,
                   the  Air  Pollution Control Officer  shall  perform  the
                   evaluations  required  to  determine compliance with all
                   applicable District rules and  regulations  and  make  a
                   preliminary  written decision as to whether the emission
                   reductions should  be certified as an ERC.  The decision
                   shall be supported by a succinct written analysis.

               403 PUBLICATION AND PUBLIC  COMMENT:   Except as provided in
                   Section  110,  within  ten  calendar  days  following  a
                   preliminary decision, the Air Pollution  Control Officer
                   shall  publish,  in  at  least one newspaper of  general
                   circulation  in  the  District,  a  notice  stating  the
                   preliminary  decision  of   the  Air  Pollution  Control
                   Officer,  noting how the pertinent  information  can  be
                   obtained, and  inviting  written  public  comment  for a
                   30-day period following the date of publication.

               404 PUBLIC  INSPECTION:   Except as provided in Section 110,
                   the Air Pollution Control  Officer  shall make available
                   for  public  inspection  at  the Air Quality  Management
                   District's  office  the  information  submitted  by  the
                   applicant  and  the  Air  Pollution   Control  Officer's
                   analysis  no  later  than  the  date the notice  of  the
                   preliminary decision is published,  pursuant  to Section
                   403.  Information submitted which contains trade secrets
                   shall  be  handled in accordance with Section 6254.7  of
                   the California  Government Code and relevant sections of
                   the California Administrative  Code.  Further,  all such
                   information shall be transmitted no later than the  date
                   of publication to the California Air Resources Board and
                   the  US Environmental Protection Agency regional office,
                   and to any party which requests such information.


               405 CERTIFICATION, FINAL ACTION:
                   405.1 Within 180 days after acceptance of an application
                         as  complete,  the  Air  Pollution Control Officer
                         shall take final action on  the  application after
                         considering all written comments.
                   405.2 Except  as  provided  in  Section  110,   the  Air
                         Pollution  Control  Officer  shall provide written
                         notice of the final action to  the  applicant, the
                         US   Environmental  Protection  Agency,  and   the
                         California  Air Resources Board, and shall publish
                         such notice in  a newspaper of general circulation
                         and  shall  make the  notice  and  all  supporting
                         documents available  for  public inspection at the
                         Air Quality Management District's office.

               406 WITHDRAWAL OF APPLICATION: Withdrawal  of an application
                   for  certification  of  an  ERC  by the applicant  shall
                   result in cancellation.

               407 CALCULATION   OF   EMISSIONS:   Calculations   performed
                   pursuant to procedures specified  in  this Section shall
                   not conflict with the requirements of state law.
                   407.1 Actual emission reductions from modifications  to,
                         or shutdowns of, existing emissions units shall be
                         calculated    for   each   calendar   quarter   by
                         subtracting   the    projected    emissions   from
                         historical  actual emissions.  Any positive  value
                         shall  qualify   for  conversion  to  an  emission
                         reduction credit.
                   407.2 Credits for particulate matter emission reductions
                         shall be expressed in terms of PM10.
                   407.3 Credits  for  nitrogen  oxides,  reactive  organic
                         compounds, carbon monoxide, sulfur oxides and PM10
                         shall  be  quantified   in   terms  of  pounds  of
                         pollutants per quarter for each calendar quarter.
                   407.4 Actual emission reductions shall be adjusted to at
                         least  reflect  emission  rates  achievable   with
                         reasonably  available  control  technology, not to
                         exceed  50  percent  of  the  emission   reduction
                         credits or 250 pounds per day, whichever is lower.
                         The emission reductions from this adjustment  will
                         be  transferred  to the Community Bank pursuant to
                         Rule 202, NEW SOURCE  REVIEW.   This Section shall
                         not apply to offsets provided in  accordance  with
                         Health  &  Safety  Code Sections 41605.5, 42314.5,
                         and 41865 concerning emission reductions from open
                         field burning.

               408 CONVERSION OF AIR EMISSION  REDUCTIONS  TO ERCS:  Before
                   the   Air   Pollution   Control  Officer  may  issue   a
                   certificate of ownership  for any ERCs, including mobile
                   and  transportation  sources,  the  emission  reductions
                   calculated in Section  407  or  pursuant  to  Rule  206,
                   MOBILE  AND  TRANSPORTATION  EMISSION REDUCTION CREDITS,
                   shall be adjusted 1.1 emission  reductions  to  1.0 ERC.
                   Emission reductions captured by the ERC adjustment shall
                   pass  to  the  Community Bank pursuant to Rule 202,  NEW
                   SOURCE REVIEW.

               409 REGISTRATION:
                   409.1 Following   certification  of  emission  reduction
                         credits  and  verification   that   the   proposed
                         emission reductions have been implemented, the Air
                         Pollution  Control Officer shall issue an original
                         ERC Certificate  to the owner(s) by certified mail
                         or in person.

                         The  issuance  of an  ERC  certificate  shall  not
                         constitute evidence  of  compliance with the rules
                         and   regulations   of   the   District,    or   a
                         representation or assurance to the recipient  upon
                         which  reliance is authorized or intended that the
                         ERC  represented   by   the  ERC  certificate  are
                         available from the District ERC bank.
                   409.2 The ERC Certificate shall contain:
                         a.   Certificate number, and
                         b.   Date of issuance, and
                         c.   Street address and APN  of  site creating the
                              surplus emissions reductions  for  which  the
                              ERC Certificate is issued, and
                         d.   Signature   of   the   responsible   District
                              official, and
                         e.   The  name of the owner shall be typed on  the
                              certificate  and  the  owner  shall  sign the
                              certificate.   If  the  owner is a public  or
                              private business entity,  a person authorized
                              to sign on behalf of the owner shall sign the
                              certificate, and
                         f.   Conditions of operation or use, including the
                              life  of  the  credit for emission  reduction
                              credits issued pursuant  to  Rule 206, MOBILE
                              AND TRANSPORTATION SOURCE EMISSION  REDUCTION
                              CREDITS.
                   409.3 A  copy  of  each ERC Certificate issued shall  be
                         maintained in the Bank Register.
                   409.4 Multiple  owners  of  emission  reduction  credits
                         shall be separated  according to agreements, filed
                         with the District,  between  the  owners  with one
                         ERC  Certificate  issued  to  each owner for their
                         respective portion.
                   409.5 Upon   transfer  of  ERCs  between  parties,   the
                         transferor's  ERC  certificate,  and  a  copy of a
                         writing, signed by the transferor, authorizing and
                         memorializing  the  transfer  of  the  ERC  to the
                         transferee   must   be   surrendered  to  the  Air
                         Pollution  Control  Officer   by  the  transferee,
                         within  30  days  of  the  date  of  the   writing
                         authorizing the transfer of the ERCs.

                         Upon receipt and review of said documents the  Air
                         Pollution  Control  Officer  shall issue a new ERC
                         certificate  in  the name of the  transferee.   If
                         fewer   than  all  the   transferor's   ERCs   are
                         transferred,  a new certificate shall be issued to
                         the transferor  showing  the  remaining ERCs.  The
                         District may refuse to recognize  any  transfer of
                         ERCs that does not comply with the requirements of
                         this section.
                   409.6 The  original ERC Certificate surrendered  by  the
                         registered  owner  shall  be filed in the register
                         and marked with the date of  issuance  of  the new
                         ERC   Certificate(s),   the   number   of  credits
                         transferred,   and   the   new   ERC   Certificate
                         number(s).    If   fewer   than   all   ERCs   are
                         transferred,  the  new  balance in the name of the
                         original owner shall be entered in the register.
                   409.7 Prior to the issuance of a permit allowing the use
                         of ERCs, the registered owner  shall surrender the
                         ERC  Certificate  to  the  Air  Pollution  Control
                         Officer.  The certificate surrendered by the owner
                         shall be filed in the register and marked with the
                         permit number, street address and  APN  of site of
                         use, and the name of the owner using the ERCs.  If
                         a  balance  of  ERCs remain, a new ERC Certificate
                         shall be issued to  the  original  owner  and  the
                         original   ERC   Certificate  shall  be  filed  in
                         accordance with the provisions of this rule.

               410 ERC REGISTER:
                   410.1 The   register   shall   contain   the   following
                         information for each ERC Certificate issued by the
                         Air Pollution Control Officer:
                         a.   Certificate number, and
                         b.   Date of issuance, and
                         c.   Name and address of the registered owner, and
                         d.   Street address  and  APN of site creating the
                              surplus emissions reductions  for  which  the
                              ERC Certificate is issued, and
                         e.   Number of ERCs registered.
                   410.2 Upon  notice  of  a transfer of an ERC Certificate
                         the Air Pollution Control  Officer shall enter the
                         following information in the register:
                         a.   Original ERC Certificate number, and
                         b.   New   ERC  Certificate  number,   or   street
                              address, APN, and permit numbers at which the
                              ERCs are being used, and
                         c.   Name and address of new owner(s), if any, and
                         d.   Number of ERCs being transferred.
                   410.3 Upon use of  the  ERCs  for offsets, the following
                         information shall be entered in the register:
                         a.   All information required  in  Section  410.2,
                              and
                         b.   Date  ERC Certificate was surrendered to  the
                              Air Pollution Control Officer, and
                         c.   Permit   numbers  to  which  ERCs  are  being
                              applied, and
                         d.   Name and address of ERC user, and
                         e.   Name, if any,  address, and APN of site where
                              ERCs are being used as offsets, and
                         f.   Number of ERCs being used for offsets.

               411 MORATORIUM: Except as provided  in  Section 201.2, after
                   the  issuance of an ERC Certificate, subsequent  changes
                   in regulations,  except  Regulation 2,  shall not reduce
                   or eliminate the deposit.   If  the  District  Board  of
                   Directors  determines,  after review of periodic reports
                   prepared  by  the Air Pollution  Control  Officer,  that
                   additional  emission   reductions   are   necessary,   a
                   moratorium  on  withdrawals  may  be  imposed.  Prior to
                   imposing a moratorium, the Air Pollution Control Officer
                   shall provide a notice of the date of the meeting of the
                   District Board of Directors to consider  issuance  of  a
                   moratorium   to  owners  of  ERC  and  other  interested
                   parties.   The   moratorium   shall   be   lifted   upon
                   determination  that  additional  emission reductions are
                   not necessary by the District Board of Directors.