AIR QUALITY:

HOW TO KEEP SAN ANTONIO'S ATTAINMENT STATUS

Principal Investigator: Dr. John Merrifield

Associate Professor of Economics

Metropolitan Research and Policy Institute

University of Texas - San Antonio

April, 1999

Acknowledgement/Appreciation: Support from the Metropolitan Research and Policy Institute made this policy brief possible.

San Antonio is the largest US city with air quality in compliance with the Federal Clean Air Act. However, economic growth is jeopardizing San Antonio's attainment status at the same time that growth is increasing the importance of keeping it. In addition, population growth is making negative health effects more likely and more harmful. A non-attainment designation brings with it sanctions and new regulations that place significant burdens on regional economies. If those regulations are implemented, we will never know what would have happened without the burden of those handicaps. A non-attainment designation will certainly work against job creation/income enhancement initiatives, and the designation is not easily removed.

SAN ANTONIO'S AIR QUALITY SITUATION

Unlike some of the other cities that people think of when air quality problems are discussed (Los Angeles, Denver, etc), San Antonio does not have a general air quality problem. On all but a few days each year, San Antonio's air quality is outstanding. Among the Federal Clean Air Act's six criteria pollutants (nitrous oxides, ozone, hydrocarbons, particulate matter, sulfur oxides, lead), ground level ozone is the only one in danger of exceeding the ambient air quality standards.

To determine compliance (attainment status) with the ozone standard, the United States Environmental Protection Agency (USEPA) averages the preceding three years' 4^th highest ozone level (an 8-hour average). With the USEPA's estimation procedures, the standard is 85 parts per billion (ppb). According to the Texas Natural Resources Conservation Commission (TNRCC), 1997's fourth highest eight-hour average ozone reading was 84 ppb. 1998's fourth highest eight-hour average ozone reading was 90 ppb. San Antonio can 'achieve' non-attainment status in July, 2000 unless it's 4^th highest 1999 eight-hour average ozone level is 81 ppb or less.

Ozone levels can only approach health and compliance-endangering levels on the relatively few days a year (so-called Ozone Action Days [OZADs]) when weather conditions are 'ideal' for the formation of ozone. The weather conditions conducive to the formation of ground-level ozone are extremely unlikely during the cooler months, so there is a semi-official Ozone 'Season' from April through October. San Antonio had 26 OZADs in 1997, and 24 OZADs in 1998.

Over the course of a year, the San Antonio area gets many of its air pollutants from neighboring counties, such as the industry along the coast, and the urban corridor to the Northeast. However, the threat to our attainment status comes from local sources. Winds are generally very light on the days (OZADs) when weather conditions are ‘ideal’ for Ozone formation, so the ability of pollutants generated in distant counties to migrate to San Antonio on those days is minimal. That critical fact is often overlooked. For example, the Report and Recommendations of the Mayor’s Air Quality Advisory Group (11/15/98) said that "about 67% of the ozone in San Antonio comes from other parts of the state (p i);" true generally, but false on the critical OZADs. An October, 1997 report (Application of the Urban Airshed Model to the San Antonio - Austin, Texas Region) by ENVIRON International Corporation concluded that because of light winds on OZADs, local sources were jeopardizing San Antonio’s attainment status. San Antonio has much more control over its attainment status than many analysts seem to believe.

The San Antonio area has four Continuous Air Monitoring Stations (CAMS) that collect and report Ozone data. CAMS 62 is located in San Marcos. CAMS 58 is located at Calaveras Lake. It began reporting data last year. CAMS 7, located near the Loop 410/IH-10/Crossroads area, was moved to the Camp Bullis area, and redesignated CAMS 59 in August, 1998. CAMS 23 is in Northwest San Antonio. According to the TNRCC, CAMS 23 is probably going to be the "designation monitor"; the monitor most likely to have the highest three-year average, 4^th highest ozone reading. The 1997 and 1998 Ozone Season data from each CAMS paint the same general picture. During 1999, eight-hour averages over 81 ppb threaten San Antonio's attainment status, but the one-hour average Ozone readings are typically below 30 ppb; generally a bit higher in the San Antonio - Austin corridor (CAMS 62 in San Marcos) than right in San Antonio. Days without a single hourly reading above, or even close to, 85 ppb are the norm. Clearly, San Antonio's Air Quality problem is one of a few peak episodes.

EMISSION REDUCTION OPPORTUNITIES

Stationary sources like factories and power plants are already subject to significant emission control requirements. The opportunities to realize significant cost-effective emission reductions beyond what the city is already doing at the city-owned, City Public Service power plants are extremely limited.

Stationary sources such as fuel transfer facilities (for example, gas stations) sometimes also produce evaporative emissions. City leaders are pursuing this source of air quality improvement through reformulated fuels. Every major fuel supplier has already promised to sell cleaner fuel, supposedly at no additional cost. Economists are naturally cynical about alleged 'free lunches'. Even if the owners of the oil companies are motivated to absorb the additional costs for public relations benefits, society still incurs the additional costs. Most relevant to the cost-effectiveness issue is that the increased use of reformulated fuels means that higher gasoline costs are incurred all the time (by someone, somewhere), but the resulting emission reductions have significant value only on each year's few Ozone Action Days (OZADs).

Local mobile sources (cars, trucks, buses, and heavy equipment) account for a significant share of San Antonio's emissions, especially on OZADs. Late model cars have advanced emission controls, and well-maintained older cars are relatively clean. The lion's share of mobile source emissions comes from a relatively few, poorly maintained cars, especially the older, smoke-belching clunkers that are a familiar sight in San Antonio. Peterson and Stedman (1992) and Bishop et al (1993) found that 10% of the vehicles ("gross emitters") in their survey were responsible for over half of the key emissions. The Mayor’s Advisory Group defined a ‘gross emitter’ as a car that emits 5-10 times the pollution of an average car.

In southern cities like San Antonio, where cars don't have to survive long cold winters, gross emitters are probably responsible for a larger share of emissions than they are elsewhere. San Antonio's leaders must tap that source of major emission reductions. Indeed, the Mayor’s Advisory Group found that "70-80% of automotive emissions can come from 20% of the cars on the road.

POLICY RECOMMENDATIONS

The peak episode nature of San Antonio's air quality problem, and the sources of cost-effective opportunities to reduce emissions, boils down to this imperative: Minimize the time gross emitters are on the road on Ozone Action Days. Several effects will contribute to that objective.

What can/should be done to achieve one or more of those outcomes?

1. Education

• San Antonio is on the brink of non-attainment status, and significant negative effects that will impact everyone, yet few San Antonians are aware of that, or even know what an Ozone Action Day is. Much more public education is needed!
• The Texas Natural Resource Conservation Commission (TNRCC) has a SMOG Hotline (800-453-SMOG). When a "smoking vehicle" license plate is reported, the owner gets a notice (copy attached). Under current law, the recipient of the notice can ignore it. However, according to the TNRCC's Barbara Young, 32% of the notice recipients reported making repairs, and undoubtedly, others are not reported; that's thousands fewer gross emitters. Much more publicity of the SMOG hotline is in order. The phone number ought to be visible on billboards around the city. The city, through City Public Service, is already running air quality-related ads (the sight and sound of birds gagging on small engine exhaust). Diversion of just a small fraction of the gagging bird air time to other air quality-related subjects would go a long way towards achieving the necessary public awareness on that issue.
• Greater awareness of the importance of staying in attainment, and the critical importance of reduced emissions on Ozone Action Days will increase the number of calls to the SMOG Hotline, and the percentage of notice recipients that make repairs. It will also increase support for the other recommended policies.

1. Deploy remote sensing devices. Professor Donald Stedman has been using (and improving) a device that detects gross emitting vehicles while the vehicles are moving. The Inspection and Maintenance (I&M) Programs that are mandatory in non-attainment areas cost every motorist time and money every other year. In addition, I&M programs are widely criticized because neglect and tampering occurs between the semi-annual I&M inspections (Glazer et al, 1993); like trying to catch alcoholic with scheduled sobriety tests. Remote sensing-based programs only inconvenience gross emitters, and not as much as I&M programs.
2. Prohibit the operation of gross emitters during critical periods (especially mornings) on Ozone Action Days (OZADs).
3. Prevent the importation of gross emitters by requiring pre-1982 cars pass a basic emissions test.
4. Encourage the development of privately funded scrappage programs and low-income vehicle maintenance subsidy programs.
5. Levy congestion tolls. Use the money to fund scrappage, subsidies for low income vehicle maintenance spending, and street/highway improvements to cut congestion, and otherwise cut travel times (synchronize traffic lights).
6. Better timing of traffic lights.

Discussion

Change is often unpopular, sometimes for no other reason than because entrenched routines are disturbed. Inconvenience and increased direct expenses make change even less popular. That is why the education component of the recommendations is so important. San Antonians don’t realize what is at stake; how important it is to minimize the health effects of peak ozone episodes and escape the jurisdiction of state and federal environmental regulators. Until they do, there won’t be much support for unfamiliar practices and new expenses like the use of remote sensing, increased attentiveness to vehicle maintenance, fining motorists that drive gross emitters during OZAD critical periods, and the imposition of congestion tolls.

For example, recommendation #3, to ban the use of gross emitters during OZAD critical periods, will encounter resistance under the best of circumstances. The public and their elected officials will probably see it as drastic and unrealistic unless they compare it to the consequences of a non-attainment designation. In non-attainment areas, cars that fail the more demanding (compared to the remote sensing device) I&M inspection cannot use their vehicle on ANY day. Once a non-attainment designation is made, the option to keep the vehicle off the road part of just a few days is eliminated. Unless drivers can qualify for a waiver from TNRCC, owners of gross emitters must repair their vehicle. If recommendation #3 is adopted, the families that cannot afford to repair or replace their vehicles must do without them only during OZAD critical periods. Waivers should still be available to low income families who can show that repair or replacement is impossible, and that no other viable means of transportation is available (VIA, ride-sharing, etc) for OZAD critical periods. For example, an independent contractor with an old truck might be able to show other means of transportation are not 'viable' because the old truck is needed to transport tools and construction materials.

In addition, fines for operating a gross emitter during an OZAD critical period should be waived for bona fide emergencies. However, exemptions from the OZAD gross emitter ban should be extremely rare. Allowing low-income families to pollute amounts to a public subsidy. It is a terribly costly way to subsidize them, and low-income families incur the largest health effects. Subsidies, if any, should assist them to avoid violations; that is to buy and maintain vehicles that are not gross emitters.

The remote sensing devices facilitate enforcement of recommendation #3, as well as the prevention of many OZAD violations. Deployments of remote sensing devices on non-OZADs should be used to alert drivers of gross emitters of the new ordinance. Likewise, mobile emissions testing stations (discussed in the Mayor’s Advisory Group Report) can be used to offer free emission tests in places like mall parking lots. Gross emitters detected on non-OZADs should receive notices alerting them to the need for repairs, and that without appropriate repairs the vehicle may not be operated on an OZAD. The envelope that contains the notice should also include information about the availability of waivers, alternatives like scrappage, vehicle maintenance subsidies, if any, and information about public transportation options. The latter should include bus schedules relevant to the address receiving the notice, and VIA’s existing OZAD program. City and VIA leaders should consider increased incentives to ride the bus on OZADs, including perhaps free passes for notice recipients and or waiver applicants.

It is often quite difficult for a family to change their transportation plans the evening before an OZAD. An extra day's notice would be quite helpful. Since the TNRCC only makes its OZAD forecasts available a day in advance, it is up to local weather forecasters to provide 36 hours notice of a forecasted OZAD, rather than the current practice of announcing an OZAD forecast the night before (<12 hours notice).

The proposed congestion toll is another example of a policy that will have the popularity of a migraine headache unless it is preceded by a well-designed education campaign. Perceptions aside, the fact remains that properly implemented congestion tolls are very cost-effective ways to cut emissions (Harrington et al, 1994; Sisson, 1995). Proper implementation means assessing the tolls without stopping vehicles - possible through the Transguide technology – and skillful targeting of specific road segments. The intended effect of the toll is to shift the most discretionary travel to less congested times and places. The authorities must take care that they don’t choose a road segment that will lengthen travel times by just shifting congestion to other road segments.

Properly targeted congestion tolls are economically efficient (benefits > costs) even without their considerable air quality benefits. The benefits of conserving fuel, saving motorists' time, and reduced road capacity requirements are enough to justify properly targeted tolls. For that reason, initial antagonism can gradually change into grudging support. As the public learns about the importance of air quality benefits, the motorists that pay the toll will also gradually realize that they spend less time in traffic jams, and that they spend less money on fuel and vehicle maintenance. For that reason alone, the public may eventually support the use of congestion tolls on the basis of congestion problems alone; that is not limit their use to OZADs. However, because of the initial antagonism factor, congestion toll use should begin limited to the OZAD critical periods.

EXPENSES AND REVENUE SOURCES

People are used to treating unpriced commodities like clean air as if they’re free; that is available in unlimited amounts at no cost. That is no longer true of San Antonio’s air quality, at least not every day. That fundamental change raises the following question: What is the appropriate way to charge air quality ‘consumers’ (major emission sources on OZADs), and thus reduce air quality ‘consumption’ and also pay for air quality enhancement efforts.

The air quality enhancement expenses include:

• The information/education campaign
• The remote sensing equipment, and its operators
• Administration and Planning
• Remote sensing equipment deployments
• Mail notices, assess fines, collect congestion tolls
• Process waiver requests
• Verify passage of emissions test for imported, pre-1982 vehicles
• Select road segments for the congestion toll
• Encourage/facilitate privately-funded air quality initiatives
• The use of Transguide technology
• Publicly-funded vehicle retirement programs (optional)
• Publicly-funded vehicle maintenance subsidies (optional)

The funding sources include:

• Fines paid by motorists that drive gross emitters during OZAD critical periods
• Congestion toll revenues
• (IF ABSOLUTELY NECESSARY!!!) Tax revenue: based on the principle that the largest emission sources should bear the largest share of the cost of air quality enhancement efforts, a fraction of a penny local tax on gasoline is the least indiscriminate source of tax revenue. In addition, the increased cost of gasoline will further reduce emissions. A 2^nd best option is a vehicle license surcharge. One of those two funding sources will definitely be necessary if congestion tolls are not implemented.

A non-attainment designation will adversely impact many businesses directly, including non-emitters. That fact should be used to increase the incentive for businesses to fund some air quality enhancement programs on their own. They include programs that purchase and retire gross emitters, and programs that help low-income families pay for vehicle maintenance (i.e. tune-up coupons), or vehicle replacement. For example, in Southern California (and elsewhere) some large companies helped themselves, and improved air quality, by purchasing and retiring old cars. Some car dealers helped out by offering replacement vehicle discounts to people that sell their old cars to the vehicle retirement programs.

Additional encouragement can come from the fact that – with good recordkeeping – participating businesses might be able to earn emission reduction credits to use in the event that a non-attainment designation occurs despite whatever efforts are made to avoid it.

IMPLEMENTATION

The Ozone ‘Season’ is upon us. The implementation of each recommended policy must be set in motion immediately. Complete implementation will take longer for some than others.

Relatively non-controversial items like education efforts can begin very quickly, and they should. More detailed explanations can be mailed to most households as a brochure insert in their City Public Service and or San Antonio Water System bills. The more detailed educational materials should include discussions of policy options. The options should not be limited to the recommendations described above. It is important to contrast those recommendations with policy options that do not address the peak episode nature of the problem, and with the no further action option that will almost certainly lead to the consequences of a non-attainment designation.

Even as local leaders debate the merits and details of the other recommendations, city and county staff should be laying the groundwork for their implementation; for example, contracts to use the remote sensing technologies and Transguide. In addition, they should identify and analyze the road segment options for the congestion tolls, and for the remote sensing device deployments.

They must also investigate the issues relevant to the question of how large the fines and tolls should be. The key issues are deterrence, moderation, and revenue. The fine for driving a gross emitter during an OZAD critical period has to be large enough – given the likelihood of detection - to deter a significant number of potential violators, yet small enough that likely violators can still pay it without exceptional hardship. Since the probability of detection will probably be somewhat lower than for a traffic violation, the size of the fine for driving a gross emitter on an OZAD should be somewhat larger than the fines for traffic violations. After the program generates some data, the size of the fine can be adjusted to reflect the behavioral responses.

SUMMARY

Air quality enhancement efforts rarely take into account the episodic nature of many regions’ air quality problems. To date, efforts made in San Antonio, and statewide, are no exceptions. This policy assessment made several recommendations that address that critical feature of San Antonio’s air quality situation; outstanding air quality nearly every day, plus a few OZADs that threaten the city’s designation as an attainment area. The recommended actions are relatively inexpensive and un-intrusive (definitely true relative to what is required in non-attainment areas), and as a package, they are probably self-funding without a general tax increase. If those recommendations are implemented quickly, there is a good chance that San Antonio can stay in compliance with the Federal Clean Air Act. If they are not implemented quickly, San Antonio will soon become Texas’ fifth non-attainment area.

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