SACAQMD RULE 205 COMMUNITY BANK AND PRIORITY RESERVE BANK
LAST REVISED 03/06/97



RULE 205

COMMUNITY BANK

AND PRIORITY RESERVE BANK

Adopted 11-03-94

(Amended 8-1-96, 9-5-96, 3-6-97)


INDEX

100 GENERAL

200 DEFINITIONS

300 STANDARDS

400 ADMINISTRATIVE REQUIREMENTS

500 MONITORING AND RECORDS


100 GENERAL

101 PURPOSE: The Community Bank and the Priority Reserve Bank are established within the emission reduction Register pursuant to Rule 204, EMISSION REDUCTION CREDITS. The Priority Reserve Bank is established for the purpose of providing loans of emission reduction credits for use as offsets for new or modified stationary sources that are essential public services, reuse of a closing, downsizing or re-missioning military base, or for community economic development purposes at a military base. The Priority Reserve Bank also may be used for the purpose of providing loans of emission reduction credits to comply with rules specified in Section 102.4, a conformity determination pursuant to Rule 104, General Conformity or mitigation under the California Environmental Quality Act (CEQA). The Community Bank is established for the purpose of providing loans of emission reduction credits to comply with specified prohibitory rules, New Source Review, a conformity determination pursuant to Rule 104, General Conformity or mitigation under CEQA or functionally equivalent program.

102 APPLICABLE REQUIREMENTS:

103 SEVERABILITY: If a court of competent jurisdiction issues an order that any provision of this rule is invalid, it is the intent of the Board of Directors of the District that other provisions of this rule remain in full force and affect, to the extent allowed by law.

200 DEFINITIONS:

Unless otherwise defined below, the terms used in this rule are defined in Rule 202, NEW SOURCE REVIEW, and Rule 204, EMISSIONS REDUCTION CREDITS.

201 ADJUSTMENT: Adjustment for purposes of this rule includes the emission reductions resulting from the conversion of emission reductions to emission reduction credits, pursuant to Rule 204, EMISSION REDUCTION CREDITS.

202 COMMUNITY BANK: A depository of certified emission reduction credits available to public and private entities for compliance with Rules and Regulations specified in Section 102.4, or offset requirements in Rule 202, NEW SOURCE REVIEW, for use for a conformity determination pursuant to Rule 104, General Conformity or mitigation under CEQA or functionally equivalent program through the loan of emission reduction credits.

203 COMMUNITY ECONOMIC DEVELOPMENT PURPOSES AT A MILITARY BASE: Community economic development purposes at a military base include, without limitation, the creation and/or support of new and existing businesses, work, jobs, or revenue-generating activities, benefitting any community within the District.

204 ENVIRONMENTAL CLEANUP OPERATION: Operation to remove environmental contaminants from soil or groundwater which has been mandated by the Regional Water Quality Control Board, the Department of Toxic Substances Control, the U.S. Environmental Protection Agency or any other local, state or federal law, rule or regulation.

205 ESSENTIAL PUBLIC SERVICES ACCOUNT: A depository of certified emission reduction credits for loan to applicable essential public services for use as offsets pursuant to Rule 202, NEW SOURCE REVIEW, for use for a conformity determination pursuant to Rule 104, GENERAL CONFORMITY, or for use for compliance with rules specified in Section 102.4. Except as excluded in Section 102.1, the following sources shall be considered essential public services.

206 LOCAL REUSE AUTHORITY: The local community entity established by state or local government as the entity responsible for creating the redevelopment plan for a closing, downsizing, or re-missioning military base and for directing implementation of the plan.

207 MILITARY BASE ACCOUNT: A depository of certified emission reduction credits for loan for reuse of a closing, downsizing or re-missioning military base or for community economic development purposes at a military base for use as offsets pursuant to Rule 202, NEW SOURCE REVIEW, for use for a conformity determination pursuant to Rule 104, GENERAL CONFORMITY, CEQA, or for use for compliance with rules specified in Section 102.4.

208 PERSON: Any person, firm, association, organization, partnership, limited liability company, business trust, corporation, company, contractor, supplier, installer, user or owner, or any federal, state or local government agency or public district or any officer, agent, or employee thereof.

209 PRIORITY RESERVE BANK: A depository of certified emission reduction credits in the Essential Public Services Account and the Military Base Account for loan to applicable sources for use as offsets pursuant to Rule 202, NEW SOURCE REVIEW, for use for a conformity determination pursuant to Rule 104, GENERAL CONFORMITY, or for use for compliance with Rules and Regulations specified in Section 102.4.

210 REUSE OF A CLOSING, DOWNSIZING OR RE-MISSIONING MILITARY BASE: Reuse of a closing, downsizing or re-missioning military base includes, without limitation, activities supporting the development, revitalization, conversion, re-missioning or reuse of any military facility within the District, closed or down-sized pursuant to federal law.

211 SMALL BUSINESS: A business entity that is independently owned and operated, does not have more than the equivalent of ten full-time employees and does not have more than $2 million in annual gross receipts.

212 SURPLUS EMISSION REDUCTION CREDITS: Emission reductions in excess of any emissions reductions which are:

300 STANDARDS

301 CRITERIA: The Community Bank and Priority Reserve Bank shall be supported by actual emission reductions which are certified pursuant to Rule 204, EMISSION REDUCTION CREDITS.

302 ESSENTIAL PUBLIC SERVICES ACCOUNT: Support for the Essential Public Services Account shall include, but not be limited to:

303 MILITARY BASE ACCOUNT: Support for the Military Base Account shall include, but not be limited to:

304 COMMUNITY BANK: Support for the Community Bank shall include, but not be limited to:

305 ALLOCATION:

306 TRANSFER BETWEEN BANKS: Unused emission reduction credits from a previous calendar quarter may be transferred between the Priority Reserve Bank and the Community Bank if the District Board of Directors, with the recommendation of the Air Pollution Control Officer, determines there is a need by sources requesting loans of emission credits from the Priority Reserve Bank or the Community Bank.

307 DISBURSEMENT: A loan of emission reduction credits from the Priority Reserve Bank or the Community Bank shall be granted with the issuance of a final action on an Authority to Construct, pursuant to Rule 201, GENERAL PERMIT REQUIREMENTS and/or Rule 202, NEW SOURCE REVIEW or Rule 107, ALTERNATIVE COMPLIANCE, or for use for a conformity determination pursuant to Rule 104, GENERAL CONFORMITY or mitigation under CEQA, and upon payment of a fee and the loan rate pursuant to Section 311.

308 ESSENTIAL PUBLIC SERVICES ACCOUNT PRIORITIZATION: Priority shall be given to applications to the Essential Public Services Account with the earliest date an application for an Authority to Construct is deemed complete. The Board of Directors of the District may determine that a specific project shall be given priority for access to the Essential Public Services Account based on public health or safety, regardless of the application submittal date.

309 MILITARY BASE ACCOUNT PRIORITIZATION: Priority shall be given to applications to the Military Base Account as determined by the Board of Directors of the District, with the recommendation of the Air Pollution Control Officer. Only the local reuse authority for a closing military base within the District or a federal government entity operating a military base within the District, may apply for use of credits from the Military Base Account.

310 COMMUNITY BANK LOAN PRIORITIZATION: All loan applications in the bank funding cycle will be funded subject to the quarterly funding cap. Should the total of loan requests exceed the quarterly funding cap, all loan applications in the funding cycle shall be prioritized according to the prioritization scheme outlined below. Unfunded loan applications will be held over to the next funding cycle.

311 LOAN RATES

312 COMMUNITY BANK OR PRIORITY RESERVE BANK RENEWAL FEE: Any person who requests to withdraw emission reduction credits pursuant to this rule shall pay an annual renewal fee to administer the rule. The initial renewal fee assessed shall be $1000. On March of each year, the Air Pollution Control Officer shall submit to the District's Board of Directors cost analysis which contains a recommendation for the new annual renewal fee. The District's Board of Directors shall review the cost analysis and shall set the new fee amount.

313 RESERVING ESSENTIAL PUBLIC SERVICES ACCOUNT CREDITS: Sources may, if the Air Pollution Control Officer determines a need, reserve Essential Public Services Account credits for up to three years to allow multi-year projects to be planned. The sum of such credits shall amount to no more than 25 percent of each calendar quarter allocation for the Essential Public Services Account for those three years.

314 UNUSED CREDITS: During any calendar quarter for which there are fewer requests for emission credits in the Priority Reserve Bank or the Community Bank than are available for the calendar quarter allocation, the unused credits shall be made available for use during same calendar quarter in the following year.

315 TRANSFERS: The loan of Priority Reserve Bank or the Community Bank credits shall not be transferable, whether by operation of law or otherwise, from one person to another, from one location to another, or from one emissions unit to another.

316 RETURNS: The emissions reduction calculated pursuant to Section 304 of Rule 107, ALTERNATIVE COMPLIANCE the emissions units using emission reduction credits from the Community Bank or Priority Reserve Bank shall be returned to the Essential Public Services, Military Base Account or the Community Bank under any of the following conditions as long as at the time of return the original emission reduction credits can be determined to be surplus emission reduction credits:

317 MORATORIUM: Except as provided in Section 315, a loan of emission reduction credits shall exist for the life of the emissions unit using such credits or for the loan life, whichever is shorter.

      ROG CONTROL MEASURE

SACRAMENTO OBLIGATION (TONS/DAY)

1999 2002 2005
Adhesives 0.7 0.8 0.9
Automotive Refinishing 1.3 1.6 2.0
Bakeries - - -
Graphic Arts - - -
Landfill Gas 1.0 1.0 1.0
SOCMI 1.5 1.6 1.7
Surface Prep and Cleanup 2.4 2.7 2.9
Wood Products .3 .3 .3
TCMs/Land Use 1 1 1
Plan Total 8.3 9.1 9.9
B-52's 0.8 0.8 0.8
Total 9.1 9.9 10.7

318 COMMUNITY BANK REVENUE DISBURSEMENT: Net proceeds from emission reduction credit loans from the Community Bank and Priority Reserve Bank shall only be used to fund innovative emission reduction programs. Emission reductions realized from programs so funded shall be deposited in the Community Bank.

400 ADMINISTRATIVE REQUIREMENTS

401 CALCULATION PROCEDURES: Emission reduction credits deposited in the Priority Reserve Bank or the Community Bank shall be quantified pursuant to calculation procedures specified in Rule 204, EMISSION REDUCTION CREDITS.

402 EMISSION REDUCTION CREDITS: Any stationary source which holds emission reduction credits for the affected pollutant requested in an application for Authority to Construct must first use those credits prior to being allowed access to the Essential Public Services, Military Base Account or the Community Bank.

403 NOTIFICATION OF COMMUNITY BANK OR PRIORITY RESERVE BANK RENEWAL FEE: On the renewal date of the loan, the loan requestor will be notified by mail of the fee due and payable, pursuant to Section 312, and the date the fee is due. If the fee is not paid by the specified due date, the fee shall be increased by one half the amount and the loan requestor shall be notified by mail of the increased fee. If the increased fee is not paid within 30 days after notice the loan will be canceled and the loan requestor will be notified by mail. A canceled loan may be reinstated by payment of the applicable fee plus fee increases. The stationary source may be out of compliance if the emissions loan is canceled and the stationary source continues to operate under the conditions of the emissions loan.

500 MONITORING AND RECORDS

501 RECORDKEEPING