Enforcement Policy

April 2020

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Enforcement
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Introduction

The mission of the California Air Resources Board (CARB) is to promote and protect public health, welfare, and ecological resources through the effective and efficient reduction of air pollutants while recognizing and considering the economy of the State. CARB adopts regulations designed to reduce criteria pollutants, toxic air contaminants, and greenhouse gas (GHG) emissions. While it is the responsibility of industry to meet regulatory requirements, CARB works to ensure that regulated industries are aware of, and understand, the requirements of each regulation. The effectiveness of each regulation depends on industry compliance. CARB’s enforcement program is designed to deter noncompliance and to ensure regulated industries that have not met CARB’s regulatory requirements are brought into compliance.

The Enforcement Division seeks to achieve CARB’s mission through the fair, consistent, and comprehensive enforcement of air pollution laws, and by providing training and compliance assistance. Enforcement efforts need to be focused to ensure compliance, especially in communities that may be disproportionately impacted by air pollution. These efforts include responding to concerns from the public when they are being impacted by a violation, providing compliance assistance to regulated entities, conducting inspections and investigations to gather additional information, and taking enforcement action when necessary to resolve noncompliance as quickly as possible.

This document provides CARB’s enforcement-related policies, which are rooted in several key principles: protection of public health and the environment, fairness and equal treatment across the regulated industry, deterrence through the appropriate assessment of penalties, and responsiveness to the public. This updated policy applies to all CARB enforcement programs, is consistent with statutory requirements in California Health and Safety Code (HSC) section 43024 and recent increases to stationary and mobile source penalties, and may be updated periodically as appropriate.

Enforcement Authority

CARB’s regulatory and associated enforcement authority is specified in the HSC. Within Division 26, Part 2 provides authority for airborne toxic control measures, Part 4 provides authority for stationary and some area wide sources, and Part 5 provides authority for mobile sources (including motor vehicles) and fuels. Division 25.5 applies to sources of GHGs that CARB regulates. The statutes embrace the legal doctrine of “strict liability,” meaning a prohibited act constitutes a violation no matter one’s intent or the amount of care taken to avoid violations. In several provisions, maximum penalties are higher when violations are intentional or willful. CARB regulations are located in Titles 13 and 17 of the California Code of Regulations (CCR). In some cases, such as the Asbestos Program with the federal National Emissions Standards for Hazardous Air Pollutants (NESHAP) regulation for asbestos, CARB enforces federal law as allowed under state law.

Regulatory Compliance Resources

CARB works closely with regulated parties by providing information and resources to assist business in achieving compliance. This includes providing compliance materials, broadcasting advisories to inform industry of regulatory requirements and upcoming deadlines, and answering specific questions to help regulated parties understand their compliance requirements. The Enforcement Division works with other CARB Divisions to provide this assistance.

CARB’s Office of the Ombudsman specializes in helping owners of small businesses and start-ups navigate permitting, avoid compliance issues, and find financial assistance and incentive programs with the sole purpose of encouraging compliance. 

To assist the trucking industry, CARB developed the Truck Stop, which provides important information covering compliance requirements, funding opportunities, upcoming deadlines, and other diesel program information. For additional information, CARB offers a diesel hotline at 866-6DIESEL (866-634-3735), and compliance assistance by email.

CARB staff widely broadcasts enforcement advisories, maintains webpages and list‑serves on regulatory developments, distributes brochures and fact sheets, publishes articles in trade journals, responds to public inquiries and offers compliance assistance workshops. Interested parties may subscribe up for a wide array of email alerts about regulatory program development.

CARB’s Compliance Training Program provides comprehensive compliance training covering a wide array of stationary and mobile source programs. The Compliance Training Program is hosted on CARB’s website and provides access to more than 50 courses on beginner and advanced compliance topics. The training program can be reached via email or directly by phone at (916) 322-3937.

All CARB programs maintain a webpage with the latest regulatory and compliance updates. Links to each of CARB’s programs are available in Appendix A.

Regulation Design and Implementation

Effective enforcement starts with a clear and understandable regulation. When new regulations are being developed or when existing regulations are being amended, CARB enforcement, legal, economic, and regulatory staff work closely together to ensure regulations are clearly written. Regulations must be written to assure effective implementation and enforcement, and to ensure compliance is achievable and cost-effective. Regulations should include enforcement mechanisms and may in some cases include penalty structures and calculation methods consistent with applicable statutes and established case law to provide transparency and an effective deterrent to noncompliance. Regulated entities are expected to understand what they need to do to comply and the consequences of noncompliance. They need to know that mechanisms are in place to enforce against noncompliance, achieve a level playing-field and maximize emissions reductions for public health and environmental protection. CARB may periodically hold meetings with stakeholders to discuss program-specific implementation and enforcement.

Community Support

CARB recognizes the need for increased enforcement efforts in disadvantaged communities, therefore:

  • At least 50 percent of all mobile source inspections occur in disadvantaged communities;
  • The Enforcement Division’s environmental justice team focuses on understanding and addressing community concerns. Staff liaisons are assigned to communities across the state; and
  • CARB actively supports and participates in California Environmental Protection Agency (CalEPA) environmental justice enforcement initiatives through focused enforcement of all relevant CARB programs in selected communities.

Additionally, CARB’s enforcement program works closely with the public, including disadvantaged communities, to identify, verify, and resolve air quality complaints. CARB maintains an active complaints program to support the public when impacted by an air quality concern. The goals of the program are to:

  • Provide a clear and easy-to-use process for lodging complaints;
  • Work to resolve complaints quickly and comprehensively; and
  • When appropriate, report back the results of complaint investigations to complainants.

Types of Enforcement Actions

There are three types of legal processes that CARB uses to resolve violations: civil, administrative, and criminal.

Civil Action

In cases where a mutual settlement cannot be reached, CARB may refer the matter to the Attorney General for civil litigation. As part of the civil process, CARB can obtain a court order or injunction to stop ongoing violations.

Administrative Action

CARB has the authority to seek administrative penalties for some violations. In this process, administrative hearings are conducted by administrative law judges using CARB’s administrative hearing procedures.

Criminal Action

In some cases, CARB may identify potential criminal violations. In those instances, the case may be referred to the Attorney General, a District Attorney, or other prosecutors for criminal prosecution.

Whether pursuing civil or administrative penalties, CARB retains the ability to negotiate mutual settlement agreements at any point before a final court ordered resolution of the case. The settlement agreement may include a compliance plan and penalties dependent on the facts and circumstances of the case.

CARB's Enforcement Process

CARB’s enforcement program identifies, assesses, and resolves violations; and strives to ensure fair and consistent treatment of each responsible party when applying the laws and regulations to each case. CARB’s enforcement process is intended to be a cooperative effort involving constant and clear communication between CARB and each responsible party to ensure all relevant information is shared and full compliance is obtained.

Identifying a Potential Violation

CARB learns about potential violations through inspections, tips from the public, data analysis, referrals from other agencies, mandatory emissions reporting, and voluntary disclosure. Once potential violations have been identified, CARB will initiate discussions with the responsible party to explain the enforcement process and to obtain additional information. Usually this information is collected through a cooperative process with the responsible party.

CARB also has authority under Government Code sections 11180, et seq. to subpoena information administratively. This authority to compel information disclosure may be used in cases where a violation has occurred or is anticipated.

Evaluating Information

Enforcement staff evaluates the information collected and works with CARB’s Legal Office to determine violations of statutory and/or regulatory requirements. In many instances, more information is needed; in those cases CARB most often collaboratively works with the responsible party to obtain information to identify and assess potential violations. 

Notifying the Responsible Party

When violations are substantiated, CARB may issue a citation, notice of violation, or equivalent document. In some cases, CARB issues a cease and desist letter that requires the responsible party to immediately refrain from the ongoing violation.

Notifications may contain the following information:

  • A clear listing of each violation then known;
  • The laws or regulations on which each violation is based;
  • The facts on which each violation is based;
  • Whether the law prohibits emissions at a specific level, and if so, a quantification of excess emissions where practicable;
  • Information related to potential for additional or ongoing violations;
  • A statement describing that a notice of violation represents an allegation based on evidence, no final legal determination has yet been made, and the responsible party is entitled to due process of law; and
  • Information about how to contact the Enforcement Division to resolve violations.

CARB may issue a citation, notice of violation, or equivalent document only in cases where CARB believes the evidence is sufficient and a violation could be proven in court. CARB may also initiate a vehicle registration hold through the Department of Motor Vehicles (DMV). Once issued, a registration hold precludes a vehicle from being registered until the violation is cleared.

Opportunity to Discuss

When CARB notifies a responsible party that they have violated a law or regulation, the responsible party is provided an opportunity to discuss the violation. This discussion serves several purposes. First, the responsible party may believe the accusation in the notice of violation is incorrect and they may provide evidence to persuade staff to take no further action and close the case. This can and does happen when a responsible party provides sufficient evidence to prove a violation did not occur. In these cases, CARB notifies the violator that the case is closed. Second, the opportunity to discuss allows a forum for finding an appropriate resolution to the case. This generally includes a discussion of the severity of the violation relative to the eight factors required by law to be considered and all other relevant facts and circumstances. Finally, the opportunity to discuss most often becomes the negotiation between CARB and the responsible party that in most cases leads to a mutual settlement and case resolution.

Administrative Procedures

In 1988, the California Legislature (Legislature) enacted HSC section 44011.6 directing CARB to assess administrative penalties for violations of the Heavy-Duty Vehicle Inspection Program.1  In 1995, the Legislature enacted HSC section 430282 authorizing CARB to assess administrative penalties as an alternative for civil penalties for specific fuel violations. (See also HSC section 43031(a)). HSC section 43028 applies to administrative penalty assessments that do not exceed $25,000 per day and that do not cumulatively exceed $300,000. The administrative hearings are conducted by administrative law judges (ALJ) appointed by CARB, or by ALJs employed by the Department of General Services Office of Administrative Hearings (OAH). ALJs conduct hearings using CARB’s administrative hearing procedures established in regulation.

In 2001, the Legislature enacted HSC sections 424103 and 430234 , which broadly authorized CARB to impose administrative penalties as an alternative to civil penalties for almost all violations subject to CARB’s governing statutes, and rules and regulations adopted to implement, interpret, and enforce such statutes. The authority applies to administrative penalty assessments that do not exceed $10,000 per day and do not cumulatively exceed $100,000. The administrative hearings are conducted by ALJs employed by OAH, using CARB’s administrative hearing procedures.

CARB retains discretion to determine whether an individual case will be enforced through administrative or civil processes. CARB is developing and may choose to apply expanded administrative procedures for the Refrigerant Management Program, Airborne Toxic Control Measure (ATCM) programs involving diesel sources, and the Periodic Smoke Inspection Program.

Penalties

A key component of the settlement process is the determination of an appropriate penalty. Penalties are designed to remove any economic benefit a responsible party obtained through noncompliance, and to deter future violations across the industry. While maximum penalties are established by statute, CARB measures the severity of the violation by considering all relevant circumstances, including the eight statutory factors, together with general considerations that apply to all penalty determinations. By consistently applying the enforcement process, CARB strives to assess an appropriate penalty that is fair to the responsible party, and is just to the impacted community and the affected public.

The Legislature increased maximum penalties for vehicular violations, established in Part 5 of the HSC, in 20165 and for non-vehicular violations, established in Part 4 of the HSC, in 20176 . That legislation also requires maximum penalties to be adjusted annually based on the California Consumer Price Index (California CPI)7 .

CARB considers the following factors, on a case-by-case basis, when imposing penalties:

The Eight Statutory Factors8  

  1. The extent of harm to public health, safety and welfare caused by the violation. This factor refers to the extent of injury to air quality, property, persons, or the implementation of an air quality regulation. Violations that undermine emissions standards or cause the release of excess emissions are serious violations warranting substantial penalties. In cases with substantial excess emissions, staff may estimate those emissions and value them at the cost to achieve criteria pollutant and GHG reductions using advanced technologies necessary to achieve implementation of CARB’s emissions control strategies.

CARB considers the extent to which a violation undermines the regulatory framework or functioning of enforcement programs, generates an economic benefit of noncompliance, or requires extensive investigation resources because those violations harm public health, safety, and welfare. For example, failure to maintain records or to submit certification applications could have this effect. These violations have a greater impact than where compliance can be assessed independent of reporting requirements.

  1. The nature and persistence of the violation, including the magnitude of the excess emissions. This factor refers to the duration of a violation. So, in most cases, the penalties increase the longer a violation occurs. Penalties also increase when the nature of the violation is more severe, for example when it involves toxic air contaminants or is intentional or willful.
  2. The compliance history of the defendant, including the frequency of past violations. CARB staff may consider a range of factors relating to the compliance history of the responsible party or parties, and any other related entities under common ownership and/or control as the relevant facts and circumstances merit.  CARB staff may consider repeat violations of the same regulatory requirement and/or of a different regulatory requirement in the same regulation, and violations of multiple regulations, also depending on the relevant facts and circumstances of the case. 
  3. The preventative efforts taken by the defendant, including the record of maintenance and any program to ensure compliance. Penalties may be lower for responsible parties who have made systematic attempts beyond the normal standard of care to prevent violations, including actions taken during installation, operation, and maintenance of equipment. This factor may also consider the range of applicable regulatory requirements and the responsible party’s degree of compliance with these requirements.
  4. The innovative nature and the magnitude of the effort required to comply, and the accuracy, reproducibility, and repeatability of the available test methods. Penalties may be lower for responsible parties who demonstrate they took creative actions, beyond efforts that are common in the industry to ensure compliance, even if not entirely successful.
  5. The efforts of the defendant to attain, or provide for, compliance prior to violation. Penalties may be lower for responsible parties who took action in an attempt to comply with relevant regulatory requirements prior to the violation, but were not able to fully comply. 
  6. The cooperation of the defendant during the course of the investigation and any action taken by the defendant, including the nature, extent, and time of response of any action taken to mitigate the violation. Penalties may be reduced when a responsible party fully complies with an investigation and provides requested information in a complete and timely manner. Additionally, actions a responsible party takes to mitigate the environmental and programmatic impacts of a violation may be considered when determining an appropriate penalty but may also be weighed against the severity of the violation.
  7. The financial burden to the defendant. CARB may review the responsible party’s ability to pay the penalty by evaluating assets, revenues, gross income, net income, and/or other relevant information. If an impact to the ability to pay the penalty is identified, CARB may reduce penalties and/or establish a payment plan.

General Considerations

When determining an appropriate penalty staff evaluates these general considerations in the context of the eight statutory factors described above.

  1. Deterrence. A penalty is designed to impose a consequence that will deter the responsible party and others from future violations. A penalty should remove any economic benefit resulting from the violation and include an additional amount reflecting the severity of the violation. CARB considers the need for deterrence at both program-wide and industry-specific levels. The size of the responsible party is considered when determining a penalty, to ensure adequate deterrence.

In more severe cases, CARB may quantify the economic benefit of noncompliance. The economic benefit of noncompliance may include but is not limited to benefits from delayed costs, benefits of avoided costs, benefits from business transactions that would not have occurred but for the illegal actions of the violator, and benefits derived from any competitive advantage gained in the marketplace through illegal actions. Effective deterrence may call for penalties well in excess of the economic benefit of noncompliance.

  1. Investigation Costs and Litigation Risk. In some cases, investigation costs may be high enough to warrant CARB attempting to recover them. Additionally, CARB reviews the relative strengths and weaknesses of each case and may consider litigation risk when it assesses penalties.
  2. Voluntary Disclosure. Consistent with the above considerations, CARB considers a reduction in penalties for violations that are voluntarily disclosed. The reduction is dependent on the extent to which the following criteria are met:
  • The responsible party discovered the violation through a voluntary environmental audit or other systematic procedure or practice reflecting the responsible party’s due diligence in preventing, detecting, and correcting violations;
  • The violation was not discovered due to legal mandate;
  • The responsible party disclosed the violation in writing, no more than 21 days after discovery of the violation;
  • The disclosure was independently offered and not made in response to a pending government investigation, enforcement action, or third party complaint;
  • The violation was corrected immediately;
  • The responsible party agreed to take specific actions to prevent recurrences;
  • The responsible party has not committed a similar program violation within the past three years;
  • The violation did not cause actual harm, present imminent or substantial endangerment to human health or environment, or violate specific terms of any judicial or administrative order or consent agreement; and
  • The responsible party fully cooperated with CARB’s investigation.

The reduction may range from 25 percent to 75 percent from penalties assessed based on the relevant facts and circumstances of the case. No two cases are the same. The higher reductions are reserved for cases that generated no economic benefit to the responsible party.

Minor Violations

Consistent with the above considerations, CARB may reduce penalties for minor violations in cases where:

  • There are no emissions impacts in excess of any applicable law or regulation;
  • The violation does not impede CARB’s ability to determine compliance with any emission standard;
  • The violation has been corrected;
  • The responsible party provides complete cooperation; and
  • The violations are resolved expeditiously. 

CARB will notify the responsible party if they qualify for the reduction, and may consider reducing penalties between 75 percent and 100 percent. The amount of the reduction depends on the extent of the following: 

  • Compliance history;
  • CARB resources necessary to identify, process, and resolve the violation;
  • Economic benefit of noncompliance; and
  • Harm to functioning of the regulatory program.

Maximum Penalties

Each year, the CARB Enforcement Division Chief will publish a memo documenting the changes to the California CPI and the resultant adjusted maximum penalties. CARB staff will reference these adjusted maximum penalties when establishing penalty amounts for newly discovered violations. A copy of the memo will be included in CARB’s annual Enforcement Report. The annual Enforcement Report will also include a matrix of the laws and regulations CARB enforces and the corresponding range of penalties that were assessed on a per unit basis.

Renewables Portfolio Standard

Public Utility Code section 399.30 (PUC 399.30) authorizes CARB to impose penalties based on a determination by the California Energy Commission that a publicly owned utility has failed to comply with the Renewables Portfolio Standard Program. PUC 399.30 does not require CARB to impose penalties, but when CARB does, the penalty must be comparable to those adopted by the California Public Utilities Commission for noncompliant retail sellers; these penalties may be consistent with HSC section 38580. CARB’s Enforcement Policy for the Renewables Portfolio Standard Program is included as Appendix B.

Supplemental Environmental Projects

As a condition of all settlements and judgments, CARB requires the violator to achieve and maintain compliance with air quality laws and regulations and to pay a monetary civil penalty. In some cases, CARB may allow the responsible party to satisfy part of the monetary penalty by voluntarily offsetting a portion of their civil penalty by performing or funding one or more Supplemental Environmental Projects (SEP or Project). For purposes of this policy, SEPs are projects not otherwise required by law that benefit air quality by reducing emissions, reducing exposure to air pollution, or preventing future air quality violations. After an appropriate penalty has been agreed upon by both sides, a SEP may be discussed.

CARB’s SEP policy is included as Appendix C.

Support and Oversight of Local Air District Enforcement Programs

While local air districts maintain their own civil penalty structure and processes consistent with their statutory authority, this CARB enforcement policy applies to programs that CARB enforces under its own statutory authority. HSC section 41500 requires CARB to coordinate air pollution control activities throughout the State. The Enforcement Division supports this mandate by reviewing the enforcement practices of California’s 35 local air districts to ensure that reasonable actions are being taken to enforce applicable rules and regulations. To support these objectives, CARB provides training to air district staff, provides inspection and investigative support, and evaluates district actions to ensure effective program implementation.

Each local air district has different circumstances relating to air quality challenges. State law vests local air districts with the primary responsibility for establishing and enforcing air pollution control regulations applicable to stationary sources. This statutory construct adds another layer of consideration, in addition to those required by statute (HSC section 42403 broadly applies to violations at stationary sources). In exercising their statutory authority over stationary sources, many local air districts have established mutual settlement programs (MSP) and related enforcement policies. CARB staff encourages local air districts to develop MSPs and related enforcement policies, where such programs do not already exist.

In some cases, CARB delegates enforcement authority to local air districts to help with the enforcement of some CARB regulations. When CARB has granted local air districts authority (e.g., under a memorandum of understanding) to enforce regulations with statewide applicability (e.g., regulations adopted to limit GHG emissions), CARB staff believes that the principles established by this policy should be used by local air district enforcement staff to ensure that their enforcement actions broadly result in a generally consistent outcome statewide. In these cases, CARB views settlement agreements achieved by the local agencies as agreements reached on behalf of CARB. As such, CARB staff would generally not seek additional penalties or other sanctions based on the specific circumstances identified by the air district. CARB staff will periodically review the penalties assessed by air districts to ensure that such penalties are generally consistent statewide. While CARB works with other government agencies such as air districts to enforce regulatory requirements, it retains the ability to independently investigate violations and pursue its own actions when necessary to ensure comprehensive enforcement.

In other instances, such as enforcement of mobile diesel regulations, CARB has entered into agreements with local agencies, including air districts and port authorities, to conduct inspection services on behalf of CARB. In these cases, violations identified by the local agencies are referred to CARB staff for resolution. Penalties assessed in those cases would be established using the principles established in this policy.

A list of enforcement agreements, by agency, that have been established will be updated annually in the CARB Enforcement Report.

Public Communication and Information Protection

CARB strives to ensure that information relating to case investigations is transparent and publicly available. Specifically, it is the Enforcement Division’s policy to:

  • Disclose information related to completed investigations upon request, excluding any information protected by law. CARB will maintain closed case files consistent with its file retention policy. All settlement agreements will be maintained indefinitely and will be posted on CARB’s public webpage;
  • Disclose any citation, cease and desist letter or notice of violation on a case-by-case basis, if requested, and if the disclosure will not jeopardize an ongoing investigation, or result in the disclosure of information recognized by law as confidential or otherwise privileged; 
  • Make available to the public a summary of our enforcement efforts, including but not limited to:
    • All SEPs and associated accounting of project expenditures,
    • An annual report that summarizes all enforcement activities and provides statistics about each enforcement program,
    • An assessment of compliance rates for key programs; and
  • Publicize enforcement efforts through activities such as compliance assistance programs and press events that highlight recent settlements.

While seeking to maintain a transparent program, CARB protects some information from disclosure. Information relating to pending investigations is generally not released in order to protect the integrity of the investigation as well as those under investigation. When CARB determines that a violation has occurred, that violation may be documented in a notice of violation and may be released as described above.

CARB has a duty to protect certain types of information related to regulated entities and takes this responsibility very seriously. For example, during the course of an investigation, a company may be asked to divulge confidential business information in order to determine the extent of potential violations. CARB protects this confidential information in accordance with State law and maintains it in case files in accordance with file retention policies. Similarly, during the course of an investigation, CARB may collect vehicle registration and/or driver’s license information. CARB may also collect and use information from an automated license plate reader. This information is strictly confidential and maintained in accordance with State law, CARB policy, and inter-agency agreements granting access to the information.

CARB’s usage and privacy policy on the use of an Automated License Plate Reader is included as Appendix D.

As a practical matter, confidential information is kept only for the period in which it is required to be maintained and may be released only if CARB is legally required to do so.

Appendix A: Enforcement Programs

Diesel Programs

Fuels Programs

Consumer Products Programs

Stationary and Greenhouse Gas Programs

 

New Vehicles, Engine Certification, Tampering, SOREs and Fuel Canisters

Other

Appendix B: Enforcement Policy for the Renewables Portfolio Standard Program

Established in 2002 under Senate Bill (SB) 1078, California’s Renewables Portfolio Standard (RPS) requires utilities to serve a portion of electricity sales with renewable energy resources. RPS applies to all electricity retailers in the state, including publicly owned utilities (POU), investor-owned utilities, electricity service providers, and community choice aggregators (with all but POUs collectively referred to as retail sellers). SB 2 in the first extraordinary session of 2011 revised RPS targets to 33 percent renewables by 2020 for all utilities. In October 2015, SB 350 increased RPS targets to 50 percent by 2030. SB 100 in 2018 increased the 2030 target to 60 percent.

The statutes mentioned above require the California Public Utilities Commission (CPUC) and California Energy Commission (CEC) to jointly implement RPS. CEC is required to set standards for what qualifies as an eligible renewable resource for both POUs and retail sellers, regulate POUs by adopting an RPS enforcement regulation9  (completed in 2013), and to refer any POUs found to be noncompliant to CARB for penalty assessment. CPUC is responsible for all aspects of regulating and enforcing against retail sellers.

Legislative Requirements for CARB

Public Utilities Code section 399.30 (PUC § 399.30) states that upon a determination by CEC that a POU has failed to comply with RPS, CEC shall refer the POU to CARB, which may impose penalties. These penalties must be comparable to penalties adopted by the CPUC for noncompliance by retail sellers.

Additionally, PUC § 399.30 states CARB may impose penalties consistent with Division 25.5, Part 6 (commencing with section 38580) of the Health and Safety Code (HSC § 38580). HSC § 38580 pertains to the enforcement of the California Global Warming Solutions Act of 2006 and states that CARB may use HSC § 42400 et seq. to determine and collect penalties. HSC § 42403(b) lists (non-exhaustively) eight factors that may be considered in setting a penalty amount; these eight factors can justify adjustment of a penalty up or down. Any RPS penalties collected by CARB shall be deposited in the Air Pollution Control Fund.

Investigation and Referral to CARB

Section 3208 in title 20 of the California Code of Regulations (CCR § 3208) allows CEC to investigate any failure to meet RPS procurement targets, failure to meet portfolio balance requirements, failure to adopt procurement or enforcement plans or meet other notice and disclosure requirements, and failure to submit complete annual compliance reports or other required reports or documentation.

CCR § 1240 in title 20 provides that if any POU fails to meet an RPS requirement, a complaint may be filed, and the CEC will hold a hearing on the complaint. The CEC’s decision on the complaint will include findings regarding mitigating and aggravating factors related to noncompliance. With a decision from CEC, CCR § 1240(h) requires a referral to CARB, including all findings, record of proceedings, notice of violation, and any transcripts of the hearings for determination of a penalty.

CARB will accept as settled and final CEC’s determination(s) of noncompliance and the facts relied upon to support such determination(s) within its referral. CEC may submit a suggested penalty with the referral, which CARB may use as a factor in determining penalties.

Enforcement Process

Upon receipt of the entire record of proceedings required to be delivered pursuant to CCR § 1240(h), CARB will provide written notice to the affected POU of such referral and the commencement of CARB’s enforcement process. Included with the notice will be a copy of the entire referral record from CEC.

CARB will not perform an independent investigation of the violation, but, consistent with state law, will provide the affected POU an opportunity to submit additional information to that contained in the CEC record relevant to the penalty determination. CARB may also directly request additional information necessary to determine penalties. CARB will review all information to assess a penalty consistent with regulatory requirements as described in the Enforcement Policy.

Any penalty imposed shall be comparable, but not necessarily identical, to any relevant penalties adopted by the CPUC for noncompliance by retail sellers. Comparability is a case-by-case determination based on the circumstances of a violation and any other common features of both the affected POU and retail sellers. CARB may, within its discretion and in conformance with State law, use CPUC’s penalty structure as a foundation upon which to determine penalties for similar RPS violations by POUs as a means to ensure comparability.

CARB also notes that it has discretion per HSC § 42403(b) to adjust the penalty amount away from the CPUC’s penalty structure, either up or down, depending on the circumstances of each case. In determining the amount assessed or in reaching a settlement, CARB will consider all relevant evidence provided the final penalty is still comparable to those imposed by CPUC on retail sellers.

CPUC Penalty Structure

CPUC Resolution E-425710  (October 29, 2009) specifies violations of late or incorrect reports (Table B-1). As these penalty amounts are within CARB’s statutory maximums, CARB may, as provided in State law, use this as a foundation for all similar POU violations referred to CARB from CEC as a means to ensure comparability.

Table B-1 – CPUC’s Penalty Schedule for RPS Violations by Independently Owned Utilities

Specified Violation

Scheduled Fine

Failure to file a Routine RPS Compliance Report at the time required. This includes the Project Development Status Report that the investor owned utilities must file.

$500 per day for the first ten days the filing was late and $1,000 for each day thereafter.

Failure to file a corrected Routine RPS Compliance Report within 10 business days after receiving notice from Staff that the report is incorrect or incomplete. This includes the Project Development Status Report that the investor owned utilities must file.

$500 per day for the first ten days the corrected filing was late and $1,000 for each day thereafter.

Failure to file a Verified RPS Compliance Report at the time required.

$500 per day for the first ten days the filing was late and $1,000 for each day thereafter.

Failure to file a corrected Verified RPS Compliance Report within 10 business days after receiving notice from Staff that the report is incorrect or incomplete.

$500 per day for the first ten days the corrected filing was late and $1,000 for each day thereafter.

Failure to comply with a request for information from Commission Staff that is related to RPS compliance reports in the time or in the manner required.

$500 per day for the first ten days an LSE fails to respond to Commission Staff’s request and $1,000 for each day thereafter.

CPUC Decision 14-12-02311  (December 4, 2014) outlines penalties used for any shortfall in a retail seller’s RPS procurement obligation. CPUC applies a $50 per renewable energy credit (REC) penalty to a retail seller’s shortfalls in meeting both procurement quantity requirements and portfolio balance requirements within a compliance period. This includes a per-compliance-period penalty cap of $25 million for large IOUs and a penalty cap for all other retail sellers at 50 percent of the retail seller's procurement quantity requirements for the compliance period multiplied by $50 per REC.

Appendix C: Supplemental Environmental Projects Policy

As a condition of all settlements, CARB requires the responsible party to achieve and maintain compliance with air quality laws and regulations and to pay a monetary civil penalty. In some cases, CARB may allow the violator to satisfy part of the monetary penalty by voluntarily performing or funding one or more Supplemental Environmental Projects (SEP or Project). For purposes of this policy, SEPs are projects not otherwise required by law or regulation that benefit air quality by reducing emissions, reducing exposure to air pollution, or preventing future air quality violations.

If CARB approves a SEP as part of a settlement, the settlement agreement will provide that the violator agrees to conduct the SEP and CARB agrees to offset a portion of the penalty for SEP implementation. This policy meets the requirements of Public Resources Code section 71118, which requires each of the California Environmental Protection Agency’s (CalEPA) boards, departments and offices that have enforcement authority to establish SEP policies that benefit disadvantaged communities. Specifically, Public Resources Code section 71118 requires CARB’s SEP policy to include:

  • A public process to solicit potential SEPs from disadvantaged communities.
  • Allowing the amount of a SEP to be up to 50 percent of the enforcement action.
  • Developing an annual list of SEPs that may be selected to settle a portion of an enforcement action.
  • Consideration of the relationship between the location of the violation and the location of the proposed SEP.

This policy provides CARB’s process for selection of SEPs and how CARB will oversee implementation of SEPs that are included in settlement agreements. CARB will annually develop a list of eligible SEPs through a public process, make this list available on CARB’s website, and provide this list to CalEPA at least on an annual basis.

SEP Selection Criteria

A SEP must meet the following criteria in order to be eligible for funding: 

  • Furthers CARB’s purpose of cleaning up the air by:
    • a) reducing the risk burden to public health,
    • b) preventing future air quality problems beyond those addressed in current air quality programs, or
    • c) improving the environment;
  • Has a nexus to the violation either through location (i.e., the SEP furthers CARB’s purpose of cleaning up the air in the specific community where the violation occurred) or through pollutant (i.e., the SEP furthers CARB’s purpose of cleaning up the air by addressing the pollutants involved in the violation);
  • Does not benefit the violator; and
  • Goes beyond regulatory requirements that are imposed by a federal, state, or local responsible party.

CARB prefers SEPs that meet one or more of the following criteria: 

  • Provide direct emissions or exposure reductions,
  • Benefit disadvantaged communities,
  • Provide community benefits in addition to furthering CARB’s purpose of cleaning the air, or
  • Address multiple environmental problems (such as SEPs that have water, soil, or other environmental benefits in addition to air benefits).

Up to 50% of the penalty amount negotiated in a settlement may be offset with a SEP.

SEP Categories

A SEP shall fall into one or more of the following categories:

  • Pollution Prevention or Reduction – Preventing or reducing air pollution including greenhouse gas emissions.
  • Environmental Restoration and Protection – Improve or restore the quality of the environment.
  • Environmental Education or Compliance Training – Provide assistance to educators, schools, and community groups to conduct training and public awareness campaigns to the public and the regulated community.
  • Community Monitoring – Provide tools, such as surveillance and monitoring equipment, to be used by trained members of the public for data acquisition and enhancement of existing air quality monitoring stations.
  • Trans-Boundary – Provide support for projects that provide a direct benefit to Californians in and around the border environment with other states and Mexico.
  • Other – Other acceptable SEPs can be considered on a case-by-case basis. In limited circumstances, the Executive Officer may make an exception to this policy if there is an extraordinary benefit to human health or the environment that outweighs the considerations used in developing this policy.

Responsibilities of Violators

Through the settlement process, the violator may agree to implement a SEP. The violator may choose one of the following options:

  • Design and implement a SEP
    • If the violator chooses to design and implement a SEP:
      • CARB must approve the SEP designed by the violator;
      • The violator is responsible for ensuring the project is completed;
      • The portion of the settlement allocated to a SEP is treated as a suspended penalty that is waived upon project completion. If the SEP is not completed, the violator must pay the suspended penalty;
      • The violator is responsible for overseeing the project and reporting to CARB, including progress reports and a final report declaring the completion of the SEP, addressing how the expected project goals were met, and certifying post-project accounting of expenditures; and
      • CARB must approve the final report before the penalty is waived. If the SEP is only partially completed, CARB will determine the amount of the penalty waived.
  • Select a SEP from the CARB list and deposit money in a SEP administrator account
    • The SEP is considered complete and the penalty waived once the violator has deposited money in the SEP administrator account.
    • The SEP recipient is responsible for ensuring SEP completion. 
  • Deposit money in a SEP administrator account
    • The SEP is considered complete and the penalty waived once the violator has deposited money in the SEP administrator account.
    • The SEP administrator is responsible for selecting a suitable SEP from the CARB list consistent with this policy.
    • The SEP recipient is responsible for ensuring SEP completion

Responsibilities of SEP Administrators

A SEP administrator is a party contracted with CARB to administer a SEP or group of SEPs. SEP administrators are responsible for: 

  • Managing financial contributions to SEPs by: 
    • Collecting and managing SEP payments received from violators,
    • Tracking funds by location of violation and type of pollutant,
    • Tracking funds allocated for specific SEPs,
    • Disbursing funds to SEPs, and
    • Tracking and accounting for disbursed funds;
  • Ensuring that any selected SEP meets the requirements and criteria defined in this policy; and
  • Providing tracking, oversight, and reporting of the project to CARB, including:
    • Monitoring the timely and successful completion of each SEP;
    • Requesting and maintaining Project accounting from SEP recipient;
    • Notifying CARB if a SEP recipient is not meeting proposed schedule or milestones;
    • Providing quarterly progress reports and a final completion report for each SEP, declaring the completion of SEPs, certifying SEP accounting of expenditures upon completion, and describing the overall environmental and community benefits of the project; and
    • Providing an annual report to CARB that describes funding received, funding expended, remaining available funding, SEPs funded, and any other information requested by CARB.

Appendix D: California Air Resources Board Automated License Plate Reader Privacy and Usage Policy

The California Air Resources Board (CARB) collects emissions information for research and enforcement. Sometimes data is collected at the roadside from a large number of trucks. CARB is developing a new system, called the Portable Emissions AcQuisition System (PEAQS), which measures emissions as cars or trucks pass sensors. PEAQS is equipped with an Automated License Plate Reader (ALPR) and will be used to assess the distribution of emissions by model year, make/model, and technology type from cars and trucks. This is necessary for investigating tampered or malfunctioning vehicles, air monitoring, fleet characterization, identifying the effectiveness of CARB regulations, and future policy recommendations. PEAQS will be used as a screening tool to identify high emitting vehicles for inspection in the field or a fleet-level investigation. If CARB expands the use of PEAQS beyond screening methods, it will do so following a public process. 

The ALPR system component is a mobile or fixed camera that is combined with sophisticated computer software to capture and record a vehicle’s license plate information. These systems typically operate by photographing an image of a license plate, using optical character recognition (OCR) software to convert the image into the alpha-numeric characters of the license plate, and then comparing the alpha-numeric data to data held in other databases. ALPR systems capture other data as well, including the geographic location of a license plate and the time and date that the license plate was scanned. The ALPR systems can also provide a "contextual" photo of the car itself, making information about car make and model, distinguishing features, state of registration, and driver and passenger potentially available. The ALPR system does not identify a specific person. 

The photograph the system generates is not considered “personally identifiable information” (PII) because it does not contain an individual’s first name or first initial and last name, and it is not paired with data elements such as an individual’s social security number, or driver’s license number. However, the data generated from the photograph with the use of an ALPR system can be linked to an identifiable person through a registration database, such as the Department of Motor Vehicles (DMV). When ALPR information is cross referenced with DMV registration data, it provides make/model, and model year along with the registered owner information. CARB has a long history of managing DMV data and adheres to DMV data management requirements as outlined in the DMV Information Security Agreement (DISA), and the CARB Information Security Manual (ISM).

Requirements

CARB’s ALPR Privacy and Usage Policy incorporates the requirements of Civil Code sections 1798.29, 1798.82, and 1798.90.5, et seq., which requires all public agencies that operate an ALPR system shall maintain reasonable security procedures and practices, including operational, administrative, technical, and physical safeguards to protect ALPR information from unauthorized access, destruction, use, modification or disclosure. At a minimum, public agencies must:

  • Implement a usage and privacy policy that ensures all public agencies collect, use, maintain, share, and disseminate ALPR information in an authorized and secure manner.
  • Disclose any breach of security of the data to any affected resident of California, consistent with the requirements of Civil Code section 1798.29.
  • Provide an opportunity for public comment at a regularly scheduled public meeting before implementing the program.

The ALPR Privacy and Usage Policy is available to the public in writing, and is posted at ALPR Privacy Usage Policy 05.13.2017.

Policy

  • ALPR information will be collected only for the purposes of research, regulation development and implementation, emissions inventory, or enforcement.
  • CARB will designate a custodian responsible for ALPR data and the effective implementation of this policy.
  • Only trained and authorized staff will generate, store, access, or analyze ALPR information.
  • ALPR information will be stored only on limited access and encrypted drives that meet state standards for storing data, including but not limited to NIST Cryptographic Module Validation Program or equally protective standards that are generally accepted.
  • CARB staff will maintain records of each staff person that generates, stores, accesses, or analyzes ALPR data consistent with Civil Code section 1798.90.52.
  • CARB will provide training to each staff person that ensures the security of the information and compliance with applicable privacy laws.
  • ALPR information will not be sold, shared, or transferred to other persons outside of CARB, except for the following purposes:
    • Law enforcement agencies for authorized law enforcement purposes.
    • Public agencies that have signed a confidentiality agreement and agreed to keep the information confidential.
  • ALPR information that has been cross referenced to DMV registration information will be treated as DMV registered data.
  • ALPR information will be retained and destroyed consistent with CARB’s file retention policy.
  • Aggregate data, vehicle make, model, model year, and technology emissions information are not considered confidential information.

Procedures

  • The assigned ALPR data custodian is CARB’s Chief Information Officer (CIO), or designee. The ALPR custodian will monitor the ALPR system and ensure the security of the ALPR information by:
    • Maintaining a log for each time the ALPR information is accessed between operators and users.
    • Verifying only authorized users have access to ALPR information by conducting periodic audits of access and usage.
    • Ensuring each ALPR operator and user has taken all required training before accessing ALPR information.
  • All authorized ALPR system operators, users, and custodians must receive training, which will be part of the DMV data security training and include:
    • A security briefing presentation.
    • A signed confidentiality acknowledgement form, which confirms that they have received and understand all ALPR policies and procedures.
  • The custodian will keep a list of trained users and operators that includes name, title, and contact information and will be updated annually.
  • CARB staff will view the image of the license plate and cross reference it with the information produced by the ALPR system to confirm that the image of the license plate was correctly recognized by the ALPR system. If a data error is found, CARB staff will correct the error in the database and notify management.
  • All ALPR users, operators, and custodians must document access to ALPR information in a usage log and it must contain the following information:
    • The date and time the information is accessed.
    • The license plate number or other data elements used to query the ALPR system.
    • The username of the person who accesses the information.
    • The purpose for accessing the information.
  • The log is maintained electronically at their workstation, and is submitted to the custodian on a quarterly basis.
  • In the event of a data security breach involving ALPR data, CARB staff will notify CARB’s ISO, who will take the following steps: 
    • Notify the subject of the security breach in accordance with the requirements of section 1798.82 of the Civil Code.
    • Follow the procedural requirements of the Statewide Information Management Manual (SIMM).

Changes to the Policy

CARB reserves the right to revise this policy at any point in the future and such changes will be retroactively applicable to data collected prior to any revision of this policy. When CARB revises the ALPR Privacy and Usage Policy, the “last updated” date at the top of the ALPR Privacy and Usage Policy will reflect the date of the last change. We encourage visitors to review this ALPR Privacy and Usage Policy periodically.

Documents

Enforcement Policy April 2020
ENFORCEMENT_POLICY_APR_2020 _AMENDMENTS_R.PDF · 667 KB

Related Resources

PSIP Regulation
Test Method 435
Automated License Plate Reader