S.B. No. 12

	AN ACT
	relating to programs for the enhancement of air quality, including
	energy efficiency standards in state purchasing and energy
	consumption; providing penalties.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
	ARTICLE 1. LOW-INCOME VEHICLE REPAIR ASSISTANCE, RETROFIT, AND
	ACCELERATED VEHICLE RETIREMENT PROGRAM
	SECTION 1.01.  Section 382.003, Health and Safety Code, is
	amended by adding Subdivisions (7-a), (9-a), and (10-a) to read as
	follows:
	(7-a)  "Hybrid motor vehicle" means a motor vehicle
	that draws propulsion energy from both gasoline or conventional
	diesel fuel and a rechargeable energy storage system.
	(9-a)  "Motor vehicle" means a fully self-propelled
	vehicle having four wheels that has as its primary purpose the
	transport of a person or persons, or property, on a public highway.
	(10-a)  "Qualifying motor vehicle" means a motor
	vehicle that meets the requirements of Section 382.210(b).
	SECTION 1.02.  Subsection (b), Section 382.0622, Health and
	Safety Code, is amended to read as follows:
	(b)  Except as provided by Subsection [Subsections] (b-1)
	[and (e)], Clean Air Act fees shall be deposited in the state
	treasury to the credit of the clean air account and shall be used to
	safeguard the air resources of the state.
	SECTION 1.03.  Section 382.209, Health and Safety Code, is
	amended by amending Subsections (b), (e), and (g) and adding
	Subsections (i) and (j) to read as follows:
	(b)  The commission shall provide funding for local
	low-income vehicle repair assistance, retrofit, and accelerated
	vehicle retirement programs with available funds collected under
	Section 382.202, 382.302, or other designated and available funds.
	The programs shall be administered in accordance with Chapter 783,
	Government Code. Program [Programmatic] costs may include call
	center management, application oversight, invoice analysis,
	education, outreach, and advertising. Not more than 10 percent of
	the money provided to a local low-income vehicle repair assistance,
	retrofit, and accelerated vehicle retirement program under this
	section may be used for the administration of the programs,
	including program costs.
	(e)  A vehicle is not eligible to participate in a low-income
	vehicle repair assistance, retrofit, and accelerated vehicle
	retirement program established under this section unless:
	(1)  the vehicle is capable of being operated;
	(2)  the registration of the vehicle:
	(A)  is current; and
	(B)  reflects that the vehicle has been registered
	in the county implementing the program for the 12 months preceding
	the application for participation in the program;
	(3)  the commissioners court of the county
	administering the program determines that the vehicle meets the
	eligibility criteria adopted by the commission, the Texas
	Department of Transportation, and the Public Safety Commission;
	[and]
	(4)  if the vehicle is to be repaired, the repair is
	done by a repair facility recognized by the Department of Public
	Safety, which may be an independent or private entity licensed by
	the state; and
	(5)  if the vehicle is to be retired under this
	subsection and Section 382.213, the replacement vehicle is a
	qualifying motor vehicle.
	(g)  A participating county may contract with any
	appropriate entity, including the regional council of governments
	or the metropolitan planning organization in the appropriate
	region, or with another county for services necessary to implement
	the participating county's low-income vehicle repair assistance,
	retrofit, and accelerated vehicle retirement program. The
	participating counties in a nonattainment region or counties
	participating in an early action compact under Subchapter H may
	agree to have the money collected in any one county be used in any
	other participating county in the same region. [The participating
	counties may also agree to contract with any appropriate entity,
	including the regional metropolitan planning organization or
	council of governments, to implement a program under Section
	382.217.]
	(i)  Notwithstanding the vehicle replacement requirements
	provided by Subsection (d)(2), the commission by rule may provide
	monetary or other compensatory assistance under the low-income
	vehicle repair assistance, retrofit, and accelerated vehicle
	retirement program, subject to the availability of funds, for the
	replacement of a vehicle that meets the following criteria:
	(1)  the vehicle is gasoline-powered and is at least 10
	years old;
	(2)  the vehicle owner meets applicable financial
	eligibility criteria;
	(3)  the vehicle meets the requirements provided by
	Subsections (e)(1) and (2); and
	(4)  the vehicle has passed a Department of Public
	Safety motor vehicle safety inspection or safety and emissions
	inspection within the 15-month period before the application is
	submitted.
	(j)  The commission may provide monetary or other
	compensatory assistance under the low-income vehicle repair
	assistance, retrofit, and accelerated vehicle retirement program
	for a replacement vehicle or replacement assistance for a pre-1996
	model year replacement vehicle that passes the required United
	States Environmental Protection Agency Start-Up Acceleration
	Simulation Mode Standards emissions test but that would have failed
	the United States Environmental Protection Agency Final
	Acceleration Simulation Mode Standards emissions test or failed to
	meet some other criterion determined by the commission; provided,
	however, that a replacement vehicle under this subsection must be a
	qualifying motor vehicle.
	SECTION 1.04.  Section 382.210, Health and Safety Code, is
	amended to read as follows:
	Sec. 382.210.  IMPLEMENTATION GUIDELINES AND REQUIREMENTS.
	(a)  The commission by rule shall adopt guidelines to assist a
	participating county in implementing a low-income vehicle repair
	assistance, retrofit, and accelerated vehicle retirement program
	authorized under Section 382.209. The guidelines at a minimum
	shall recommend:
	(1)  a minimum and maximum amount for repair
	assistance;
	(2)  a minimum and maximum amount toward the purchase
	price of a replacement vehicle qualified for the accelerated
	retirement program, based on vehicle type and model year, with the
	maximum amount not to exceed:
	(A)  $3,000 for a replacement car of the current
	model year or the previous three model years, except as provided by
	Paragraph (C);
	(B)  $3,000 for a replacement truck of the current
	model year or the previous two model years, except as provided by
	Paragraph (C); and
	(C)  $3,500 for a replacement hybrid vehicle of
	the current model year or the previous model year;
	(3)  criteria for determining eligibility, taking into
	account:
	(A)  the vehicle owner's income, which may not
	exceed 300 percent of the federal poverty level;
	(B)  the fair market value of the vehicle; and
	(C)  any other relevant considerations;
	(4)  safeguards for preventing fraud in the repair,
	purchase, or sale of a vehicle in the program; and
	(5)  procedures for determining the degree and amount
	of repair assistance a vehicle is allowed, based on:
	(A)  the amount of money the vehicle owner has
	spent on repairs;
	(B)  the vehicle owner's income; and
	(C)  any other relevant factors.
	(b)  A replacement vehicle described by Subsection (a)(2)
	must:
	(1)  except as provided by Subsection (c), be a vehicle
	in a class or category of vehicles that has been certified to meet
	federal Tier 2, Bin 5 or a cleaner Bin certification under 40 C.F.R.
	Section 86.1811-04, as published in the February 10, 2000, Federal
	Register;
	(2)  have a gross vehicle weight rating of less than
	10,000 pounds; and
	(3)  be a vehicle the total cost of which does not
	exceed $25,000.
	(c)  The commission may adopt any revisions made by the
	federal government to the emissions standards described by
	Subsection (b)(1).
	(d)  A participating county shall provide an electronic
	means for distributing vehicle repair or replacement funds once all
	program criteria have been met with regard to the repair or
	replacement. The county shall ensure that funds are transferred to
	a participating dealer under this section not later than five
	business days after the date the county receives proof of the sale
	and any required administrative documents from the participating
	dealer.
	(e)  In rules adopted under this section, the commission
	shall require a mandatory procedure that:
	(1)  produces a document confirming that a person is
	eligible to purchase a replacement vehicle in the manner provided
	by this chapter, and the amount of money available to the
	participating purchaser;
	(2)  provides that a person who seeks to purchase a
	replacement vehicle in the manner provided by this chapter is
	required to have the document required by Subdivision (1) before
	the person enters into negotiation for a replacement vehicle in the
	manner provided by this chapter; and
	(3)  provides that a participating dealer who relies on
	a document issued as required by Subdivision (1) has no duty to
	otherwise confirm the eligibility of a person to purchase a
	replacement vehicle in the manner provided by this chapter.
	(f)  In this section, "total cost" means the total amount of
	money paid or to be paid for the purchase of a motor vehicle as set
	forth as "sales price" in the form entitled "Application for Texas
	Certificate of Title" promulgated by the Texas Department of
	Transportation. In a transaction that does not involve the use of
	that form, the term means an amount of money that is equivalent, or
	substantially equivalent, to the amount that would appear as "sales
	price" on the Application for Texas Certificate of Title if that
	form were involved.
	SECTION 1.05.  Section 382.213, Health and Safety Code, is
	amended by amending Subsection (a) and adding Subsections (d)
	through (i) to read as follows:
	(a)  Except as provided by Subsection (c) and Subdivision (5)
	of this subsection, a vehicle retired under an accelerated vehicle
	retirement program authorized by Section 382.209 may not be resold
	or reused in its entirety in this or another state. Subject to the
	provisions of Subsection (i), the automobile dealer who takes
	possession of the vehicle must submit to the program administrator
	proof, in a manner adopted by the commission, that the vehicle has
	been retired. The vehicle must be:
	(1)  destroyed;
	(2)  recycled;
	(3)  dismantled and its parts sold as used parts or used
	in the program;
	(4)  placed in a storage facility of a program
	established under Section 382.209 and subsequently destroyed,
	recycled, or dismantled and its parts sold or used in the program;
	or
	(5)  repaired, brought into compliance, and used as a
	replacement vehicle under Section 382.209(d)(2).
	(d)  Notwithstanding Subsection (a)(3), the dismantler of a
	vehicle shall scrap the emissions control equipment and engine.
	The dismantler shall certify that the equipment and engine have
	been scrapped and not resold into the marketplace. A person who
	causes, suffers, allows, or permits a violation of this subsection
	or of a rule adopted under this section is subject to a civil
	penalty under Subchapter D, Chapter 7, Water Code, for each
	violation. For purposes of this subsection, a separate violation
	occurs with each fraudulent certification or prohibited resale.
	(e)  Notwithstanding Subsection (d), vehicle parts not
	related to emissions control equipment or the engine may be resold
	in any state. The only cost to be paid by a recycler for the
	residual scrap metal of a vehicle retired under this section shall
	be the cost of transportation of the residual scrap metal to the
	recycling facility.
	(f)  Any dismantling of vehicles or salvaging of steel under
	this section must be performed at a facility located in this state.
	(g)  In dismantling a vehicle under this section, the
	dismantler shall remove any mercury switches in accordance with
	state and federal law.
	(h)  For purposes of this section, the commission shall adopt
	rules defining "emissions control equipment" and "engine."
	(i)  Notwithstanding any other provision of this section,
	and except as provided by this subsection, a dealer is in compliance
	with this section and incurs no civil or criminal liability as a
	result of the disposal of a replaced vehicle if the dealer produces
	proof of transfer of the replaced vehicle by the dealer to a
	dismantler. The defense provided by this subsection is not
	available to a dealer who knowingly and intentionally conspires
	with another person to violate this section.
	SECTION 1.06.  Subchapter G, Chapter 382, Health and Safety
	Code, is amended by adding Section 382.219 to read as follows:
	Sec. 382.219.  PURCHASE OF REPLACEMENT VEHICLE; AUTOMOBILE
	DEALERSHIPS. (a)  An amount described by Section 382.210(a)(2) may
	be used as a down payment toward the purchase of a replacement
	vehicle.
	(b)  An automobile dealer that participates in the
	procedures and programs offered by this chapter must be located in
	the state. No dealer is required to participate in the procedures
	and programs provided by this chapter.
	SECTION 1.07.  Subchapter G, Chapter 382, Health and Safety
	Code, is amended by adding Section 382.220 to read as follows:
	Sec. 382.220.  USE OF FUNDING FOR LOCAL INITIATIVE PROJECTS.
	(a)  Money that is made available to participating counties under
	Section 382.202(g) or 382.302 may be appropriated only for programs
	administered in accordance with Chapter 783, Government Code, to
	improve air quality. A participating county may agree to contract
	with any appropriate entity, including a metropolitan planning
	organization or a council of governments to implement a program
	under Section 382.202, 382.209, or this section.
	(b)  A program under this section must be implemented in
	consultation with the commission and may include a program to:
	(1)  expand and enhance the AirCheck Texas Repair and
	Replacement Assistance Program;
	(2)  develop and implement programs or systems that
	remotely determine vehicle emissions and notify the vehicle's
	operator;
	(3)  develop and implement projects to implement the
	commission's smoking vehicle program;
	(4)  develop and implement projects for coordinating
	with local law enforcement officials to reduce the use of
	counterfeit state inspection stickers by providing local law
	enforcement officials with funds to identify vehicles with
	counterfeit state inspection stickers and to carry out appropriate
	actions;
	(5)  develop and implement programs to enhance
	transportation system improvements; or
	(6)  develop and implement new air control strategies
	designed to assist local areas in complying with state and federal
	air quality rules and regulations.
	(c)  Money that is made available for the implementation of a
	program under Subsection (b) may not be expended for call center
	management, application oversight, invoice analysis, education,
	outreach, or advertising purposes.
	(d)  Fees collected under Sections 382.202 and 382.302 may be
	used, in an amount not to exceed $5 million per fiscal year, for
	projects described by Subsection (b). The fees shall be made
	available only to counties participating in the low-income vehicle
	repair assistance, retrofit, and accelerated vehicle retirement
	programs created under Section 382.209 and only on a matching
	basis, whereby the commission provides money to a county in the same
	amount that the county dedicates to a project authorized by
	Subsection (b).
	SECTION 1.08.  Subsection (b), Section 152.002, Tax Code, is
	amended to read as follows:
	(b)  "Total consideration" does not include:
	(1)  a cash discount;
	(2)  a full cash or credit refund to a customer of the
	sales price of a motor vehicle returned to the seller;
	(3)  the amount charged for labor or service rendered
	in installing, applying, remodeling, or repairing the motor vehicle
	sold;
	(4)  a financing, carrying, or service charge or
	interest on credit extended on a motor vehicle sold under a
	conditional sale or other deferred payment contract;
	(5)  the value of a motor vehicle taken by a seller as
	all or a part of the consideration for sale of another motor
	vehicle, including any cash payment to the buyer under Section
	348.404, Finance Code;
	(6)  a charge for transportation of the motor vehicle
	after a sale; [or]
	(7)  motor vehicle inventory tax; or
	(8)  an amount made available to the customer under
	Subchapter G, Chapter 382, Health and Safety Code.
	SECTION 1.09.  Section 7.102, Water Code, is amended to read
	as follows:
	Sec. 7.102.  MAXIMUM PENALTY. A person who causes, suffers,
	allows, or permits a violation of a statute, rule, order, or permit
	relating to Chapter 37 of this code, Chapter 366, 371, or 372,
	Health and Safety Code, Subchapter G, Chapter 382, Health and
	Safety Code, or Chapter 1903, Occupations Code, shall be assessed
	for each violation a civil penalty not less than $50 nor greater
	than $5,000 for each day of each violation as the court or jury
	considers proper. A person who causes, suffers, allows, or permits
	a violation of a statute, rule, order, or permit relating to any
	other matter within the commission's jurisdiction to enforce, other
	than violations of Chapter 11, 12, 13, 16, or 36 of this code, or
	Chapter 341, Health and Safety Code, shall be assessed for each
	violation a civil penalty not less than $50 nor greater than $25,000
	for each day of each violation as the court or jury considers
	proper. Each day of a continuing violation is a separate violation.
	SECTION 1.10.  The following provisions of the Health and
	Safety Code are repealed:
	(1)  Subsection (e), Section 382.0622;
	(2)  Subsections (q) and (r), Section 382.202; and
	(3)  Section 382.217.
	SECTION 1.11.  The Texas Commission on Environmental Quality
	shall review its current cutpoint levels for nitrogen oxide
	emissions and determine whether a lower cutpoint standard would
	best serve the interest of the public health and welfare. The
	determination shall be made by rule not later than January 1, 2008.
	If the commission adopts a lower cutpoint standard, the commission
	shall make the low-income vehicle repair assistance, retrofit, and
	accelerated vehicle retirement program under Section 382.209,
	Health and Safety Code, as amended by this article, available to
	owners of vehicles that did not meet the prior, more stringent
	standard.
	SECTION 1.12.  (a)  The Texas Commission on Environmental
	Quality shall seek to work in partnership with automobile
	manufacturers and dealers in the state to increase public awareness
	of and participation in the low-income vehicle repair assistance,
	retrofit, and accelerated vehicle retirement program under Section
	382.209, Health and Safety Code, as amended by this article.
	(b)  Funding for the partnership described by Subsection (a)
	of this section shall be used exclusively for the purpose of
	publicizing the program.
	SECTION 1.13.  (a)  The Texas Commission on Environmental
	Quality shall seek to work in partnership with the steel industry
	and automobile dismantlers to ensure that vehicles being replaced
	are scrapped and that proof of scrapping is provided to the
	commission.
	(b)  Not later than January 1, 2008, the Texas Commission on
	Environmental Quality shall adopt procedures for certifying that
	emissions control equipment and vehicle engines have been scrapped
	and not resold into the marketplace and shall by rule define
	"emissions control equipment" and "engine," as required by Section
	382.213, Health and Safety Code, as amended by this article.
	ARTICLE 2.  TEXAS EMISSIONS REDUCTION PLAN
	SECTION 2.01.  Section 386.002, Health and Safety Code, is
	amended to read as follows:
	Sec. 386.002.  EXPIRATION. This chapter expires August 31,
	2013 [2010].
	SECTION 2.02.  Subsection (a), Section 386.052, Health and
	Safety Code, is amended to read as follows:
	(a)  In administering the plan established under this
	chapter and in accordance with the requirements of this chapter,
	the commission:
	(1)  shall:
	(A) [(1)]  manage plan funds and oversee the plan;
	(B) [(2)]  produce guidelines, protocols, and
	criteria for eligible projects;
	(C) [(3)]  develop methodologies for evaluating
	project cost-effectiveness;
	(D) [(4)]  prepare reports regarding the progress
	and effectiveness of the plan; and
	(E) [(5)]  take all appropriate and necessary
	actions so that emissions reductions achieved through the plan are
	credited by the United States Environmental Protection Agency to
	the appropriate emissions reduction objectives in the state
	implementation plan; and
	(2)  may hire staff and consultants needed to complete
	the commission's duties under this section and ensure timely review
	of applications and reimbursement of grant applicants' eligible
	project costs.
	SECTION 2.03.  Subsection (d), Section 386.053, Health and
	Safety Code, is amended to read as follows:
	(d)  The commission may propose revisions to the guidelines
	and criteria adopted under this section as necessary to improve the
	ability of the plan to achieve its goals. Revisions may include,
	among other changes, adding additional pollutants, adding
	stationary engines or engines used in stationary applications,
	adding vehicles and equipment that use fuels other than diesel, or
	adjusting eligible program categories, as appropriate, to ensure
	that incentives established under this chapter achieve the maximum
	possible emissions reductions. The commission shall make a
	proposed revision available to the public before the 30th [45th]
	day preceding the date of final adoption of the revision and shall
	hold at least one public meeting to consider public comments on the
	proposed revision before final adoption.
	SECTION 2.04.  Subsection (c), Section 386.104, Health and
	Safety Code, is amended to read as follows:
	(c)  For a proposed project as described by Section
	386.102(b), other than a project involving a marine vessel or
	engine, not less than 75 percent of vehicle miles traveled or hours
	of operation projected for the five years immediately following the
	award of a grant must be projected to take place in a nonattainment
	area or affected county of this state. The commission may also
	allow vehicle travel on highways and roadways, or portions of a
	highway or roadway, designated by the commission and located
	outside a nonattainment area or affected county to count towards
	the percentage of use requirement in this subsection. For a
	proposed project involving a marine vessel or engine, the vessel or
	engine must be operated in the intercoastal waterways or bays
	adjacent to a nonattainment area or affected county of this state
	for a sufficient amount of time over the lifetime of the project, as
	determined by the commission, to meet the cost-effectiveness
	requirements of Section 386.105.
	SECTION 2.05.  Subsection (a), Section 386.106, Health and
	Safety Code, is amended to read as follows:
	(a)  Except as provided by Section 386.107 and except for
	infrastructure projects and infrastructure purchases that are part
	of a broader retrofit, repower, replacement, or add-on equipment
	project, the commission may not award a grant for a proposed project
	the cost-effectiveness of which, calculated in accordance with
	Section 386.105 and criteria developed under that section, exceeds
	$15,000 [$13,000] per ton of oxides of nitrogen emissions reduced
	in the nonattainment area or affected county for which the project
	is proposed. This subsection does not restrict commission
	authority under other law to require emissions reductions with a
	cost-effectiveness that exceeds $15,000 [$13,000] per ton.
	SECTION 2.06.  Section 386.109, Health and Safety Code, is
	amended to read as follows:
	Sec. 386.109.  ELIGIBLE INFRASTRUCTURE PROJECTS. (a)  The
	commission may consider for funding under Section 386.108:
	(1)  the purchase and installation at a site of
	equipment that is designed primarily to dispense qualifying fuel,
	other than standard gasoline or diesel, or the purchase of on-site
	mobile fueling equipment;
	(2)  infrastructure projects, including auxiliary
	power units, designed to dispense electricity to:
	(A)  motor vehicles;
	(B)  [and] on-road and non-road diesels; and
	(C)  marine vessels; and
	(3)  a project that involves a technology that allows a
	vehicle to replace with electric power, while the vehicle is
	parked, the power normally supplied by the vehicle's internal
	combustion engine.
	(b)  The commission may provide funding to other state
	agencies to implement projects under Subsection (a)(3), including
	funding for the lease, purchase, or installation of idle reduction
	technologies and facilities at rest areas and other public
	facilities on major highway transportation routes located in areas
	eligible for funding or for marine vessels operating on water
	routes eligible for funding. Funding under this subsection may
	include reasonable operational costs determined by the commission
	to be needed for the initial start-up and proper operation of the
	idle reduction technologies. The state agency leasing, owning, or
	operating the idle reduction facility constructed with funds
	provided under this subsection may, but is not required to, charge
	reasonable fees for the provision of idle reduction services
	provided that those fees are used to directly offset the cost of
	providing the services.
	(c)  In evaluating a request for funding of an eligible
	infrastructure project, the commission shall encourage the use of a
	technology that allows a vehicle to replace with electric power,
	while the vehicle is parked, the power normally supplied by the
	vehicle's internal combustion engine at the state's ports and
	border crossings in affected areas.
	SECTION 2.07.  Section 386.117, Health and Safety Code, is
	amended by adding Subsections (e) and (f) to read as follows:
	(e)  The commission shall:
	(1)  investigate the requirements for establishing an
	Internet-based application process for rebate grants and report
	those requirements to the legislature not later than December 31,
	2007; or
	(2)  implement an Internet-based application process
	for rebate grants not later than June 1, 2008.
	(f)  The commission or its designee shall notify potential
	applicants of any changes to the rebate grant process by its e-mail
	list service and posting those changes on its Internet website at
	least 30 days before the changes become effective.
	SECTION 2.08.  Subsection (b), Section 386.251, Health and
	Safety Code, is amended to read as follows:
	(b)  The fund is administered by the commission
	[comptroller] for the benefit of the plan established under this
	chapter. The fund is exempt from the application of Section
	403.095, Government Code. Interest earned on the fund shall be
	credited to the fund.
	SECTION 2.09.  Subsection (a), Section 386.252, Health and
	Safety Code, as amended by Section 3, Chapter 766, Section 3,
	Chapter 1095, and Section 11, Chapter 1125, Acts of the 79th
	Legislature, Regular Session, 2005, is reenacted and amended to
	read as follows:
	(a)  Money in the fund may be used only to implement and
	administer programs established under the plan and shall be
	allocated as follows:
	(1)  for the diesel emissions reduction incentive
	program, 87.5 percent of the money in the fund, of which not more
	than four percent may be used for the clean school bus program and
	not more than 10 percent may be used for on-road diesel purchase or
	lease incentives;
	(2)  for the new technology research and development
	program, 9.5 percent of the money in the fund, of which up to
	$250,000 is allocated for administration, up to $200,000 is
	allocated for a health effects study, $500,000 is to be deposited in
	the state treasury to the credit of the clean air account created
	under Section 382.0622 to supplement funding for air quality
	planning activities in affected counties, not less than 20 percent
	is to be allocated each year to support research related to air
	quality for the Houston-Galveston-Brazoria and Dallas-Fort Worth
	nonattainment areas by a nonprofit organization based in Houston of
	which $216,000 each year shall be contracted to the Energy Systems
	Laboratory at the Texas Engineering Experiment Station for the
	development and annual calculation of creditable statewide
	emissions reductions obtained through wind and other renewable
	energy resources for the State Implementation Plan, and the balance
	is to be allocated each year to a [that] nonprofit organization or
	an institution of higher education based in Houston to be used to
	implement and administer the new technology research and
	development program under a contract with the commission for the
	purpose of identifying, testing, and evaluating new
	emissions-reducing technologies with potential for
	commercialization in this state and to facilitate their
	certification or verification; and
	(3)  for administrative costs incurred by the
	commission and the laboratory, three percent of the money in the
	fund.
	SECTION 2.10.  Section 387.003, Health and Safety Code, is
	amended by amending Subsection (a) and adding Subsections (c)
	through (h) to read as follows:
	(a)  A [The] nonprofit organization or institution of higher
	education described by Section 386.252(a)(2), under a contract with
	the commission as described by that section, shall establish and
	administer a new technology research and development program as
	provided by this chapter. The commission may contract with more
	than one entity and may limit the amount of each grant contract
	accordingly.
	(c)  The board of directors of a nonprofit organization under
	contract with the commission to establish and administer a new
	technology research and development program as provided by this
	chapter may not have more than 11 members, must include two persons
	of relevant scientific expertise to be nominated by the commission,
	and may not include more than four county judges selected from
	counties in the Houston-Galveston-Brazoria and Dallas-Fort Worth
	nonattainment areas. The two persons of relevant scientific
	expertise to be nominated by the commission may be employees or
	officers of the commission, provided that they do not participate
	in funding decisions affecting the granting of funds by the
	commission to a nonprofit organization on whose board they serve.
	(d)  The commission may enter into a grant contract with an
	institution of higher education described by Section 386.252(a)(2)
	for the institution to operate a testing facility which would be
	available for demonstration of eligible projects receiving grants
	under this chapter.
	(e)  The commission shall provide oversight as appropriate
	for grants provided to a nonprofit organization under this program.
	(f)  A nonprofit organization shall submit to the commission
	for approval a budget for the disposition of funds granted under
	this program.
	(g)  The commission shall limit the use of grants for
	administrative costs incurred by a nonprofit organization to an
	amount not to exceed 10 percent of the funding provided to the
	nonprofit organization under this program.
	(h)  A nonprofit organization that receives grants from the
	commission under this program is subject to Chapters 551 and 552,
	Government Code.
	SECTION 2.11.  Section 387.004, Health and Safety Code, is
	amended to read as follows:
	Sec. 387.004.  SOLICITATION OF NEW TECHNOLOGY PROPOSALS.
	The commission from time to time shall issue or contract with a
	nonprofit organization described by Section 386.252(a)(2) to issue
	specific requests for proposals (RFPs) or program opportunity
	notices (PONs) for technology projects to be funded under the
	program.
	SECTION 2.12.  Section 387.005, Health and Safety Code, is
	amended to read as follows:
	Sec. 387.005.  ELIGIBLE PROJECTS; PRIORITIES. (a)  Grants
	awarded under this chapter shall be directed toward a balanced mix
	of:
	(1)  retrofit and add-on technologies and other
	advanced technologies that [to] reduce emissions from the existing
	stock of engines and vehicles targeted by the Texas emissions
	reduction plan;
	(2)  the establishment of a testing facility to
	evaluate retrofits, add-ons, advanced technologies, and fuels, or
	combinations of retrofits, add-ons, advanced technologies, and
	fuels, to determine their effectiveness in producing emissions
	reductions, with emphasis on the reduction of oxides of nitrogen;
	and
	(3)  advanced technologies for new engines and vehicles
	that produce very-low or zero emissions of oxides of nitrogen,
	including stationary and mobile fuel cells[;
	[(3)     studies to improve air quality assessment and
	modeling; and
	[(4)     advanced technologies that reduce emissions from
	other significant sources].
	(b)  The commission, directly or through a nonprofit
	organization described by Section 386.252(a)(2), shall identify
	and evaluate and may consider making grants for technology projects
	that would allow qualifying fuels to be produced from energy
	resources in this state. In considering projects under this
	subsection, the commission shall give preference to projects
	involving otherwise unusable energy resources in this state and
	producing qualifying fuels at prices lower than otherwise available
	and low enough to make the projects to be funded under the program
	economically attractive to local businesses in the area for which
	the project is proposed.
	(c)  In soliciting proposals under Section 387.004 and
	determining how to allocate grant money available for projects
	under this chapter, the commission shall give special consideration
	to advanced technologies and retrofit or add-on projects that
	provide multiple benefits by reducing emissions of particulates and
	other air pollutants.
	(d)  A project that involves publicly or privately owned
	vehicles or vessels is eligible for funding under this chapter if
	the project meets all applicable criteria.
	(e)  [Studies authorized under Subsection (a)(3) shall be
	consistent with air quality research priorities identified by the
	commission and conducted in an independent and objective manner.
	[(f)]  If a commissioner is an employee or owner of an entity
	that applies for a grant under this chapter, the commissioner,
	before a vote on the grant, shall disclose the fact of the
	commissioner's employment or ownership. The disclosure must be
	entered into the minutes of the meeting. The commissioner may not
	vote on or otherwise participate in the awarding of the grant. If
	the commissioner does not comply with this subsection, the entity
	is not eligible for the grant.
	(f)  Selection of grant recipients by a nonprofit
	organization described by Section 386.252(a)(2) under contract
	with the commission for the purpose of establishing and
	administering a new technology research and development program as
	provided by this chapter is subject to the commission's review and
	to the other requirements of this chapter. A grant contract under
	this chapter using funds described by Section 386.252 may not be
	made by a nonprofit organization if the commission or executive
	director of the commission does not consent to the grant or
	contract.
	SECTION 2.13.  Subsection (d), Section 151.0515, Tax Code,
	is amended to read as follows:
	(d)  This section expires August 31, 2013 [September 30,
	2010].
	SECTION 2.14.  Subsection (c), Section 152.0215, Tax Code,
	is amended to read as follows:
	(c)  This section expires August 31, 2013 [September 30,
	2010].
	SECTION 2.15.  Subsections (a), (b), and (b-1), Section
	501.138, Transportation Code, are amended to read as follows:
	(a)  An applicant for a certificate of title, other than the
	state or a political subdivision of the state, must pay the county
	assessor-collector a fee of:
	(1)  $33 if the applicant's residence is a county
	located within a nonattainment area as defined under Section 107(d)
	of the federal Clean Air Act (42 U.S.C. Section 7407), as amended,
	or is an affected county, as defined by Section 386.001, Health and
	Safety Code; or
	(2)  $28 if the applicant's residence is any other
	county[; or
	[(3)     on or after September 1, 2010, $28 regardless of
	the county in which the applicant resides].
	(b)  The county assessor-collector shall send:
	(1)  $5 of the fee to the county treasurer for deposit
	in the officers' salary fund;
	(2)  $8 of the fee to the department:
	(A)  together with the application within the time
	prescribed by Section 501.023; or
	(B)  if the fee is deposited in an
	interest-bearing account or certificate in the county depository or
	invested in an investment authorized by Subchapter A, Chapter 2256,
	Government Code, not later than the 35th day after the date on which
	the fee is received; and
	(3)  the following amount to the comptroller at the
	time and in the manner prescribed by the comptroller:
	(A)  $20 of the fee if the applicant's residence
	is a county located within a nonattainment area as defined under
	Section 107(d) of the federal Clean Air Act (42 U.S.C. Section
	7407), as amended, or is an affected county, as defined by Section
	386.001, Health and Safety Code; or
	(B)  $15 of the fee if the applicant's residence
	is any other county[; or
	[(C)     on or after September 1, 2010, $15
	regardless of the county in which the applicant resides].
	(b-1)  Fees collected under Subsection (b) to be sent to the
	comptroller shall be deposited as follows:
	(1)  before September 1, 2008, to the credit of the
	Texas emissions reduction plan fund; and
	(2)  on or after September 1, 2008, to the credit of the
	Texas Mobility Fund, except that $5 of each fee imposed under
	Subsection (a)(1) and deposited on or after September 1, 2008, and
	before September 1, 2015 [2010], shall be deposited to the credit of
	the Texas emissions reduction plan fund.
	SECTION 2.16.  Subsection (b-3), Section 501.138,
	Transportation Code, is amended to read as follows:
	(b-3)  This subsection and Subsection (b-2) expire September
	1, 2015 [2010].
	SECTION 2.17.  Subsection (c), Section 502.1675,
	Transportation Code, is amended to read as follows:
	(c)  This section expires August 31, 2013 [2010].
	SECTION 2.18.  Subsection (c), Section 548.5055,
	Transportation Code, is amended to read as follows:
	(c)  This section expires August 31, 2013 [2010].
	SECTION 2.19.  Section 12, Chapter 1125, Acts of the 79th
	Legislature, Regular Session, 2005, amending Subsection (a),
	Section 386.252, Health and Safety Code, is repealed.
	ARTICLE 3.  ENERGY EFFICIENCY
	SECTION 3.01.  Section 388.003, Health and Safety Code, is
	amended by adding Subsections (b-1) and (b-2) to read as follows:
	(b-1)  If the State Energy Conservation Office determines,
	based on written recommendations from the laboratory, that the
	latest published edition of the International Residential Code
	energy efficiency provisions or the latest published edition of the
	International Energy Conservation Code will result in residential
	or commercial energy efficiency and air quality that is equivalent
	to or better than the energy efficiency and air quality achievable
	under the editions adopted under Subsection (a) or (b), the office
	may by rule adopt the equivalent or more stringent editions and
	substitute them for the energy codes described by Subsection (a) or
	(b). The rule, if adopted, shall establish an effective date for
	the new energy codes but not earlier than nine months after the date
	of adoption. The laboratory shall make its recommendations not
	later than six months after publication of new editions at the end
	of each three-year code development cycle of the International
	Residential Code and the International Energy Conservation Code.
	(b-2)  The State Energy Conservation Office by rule shall
	establish a procedure for persons who have an interest in the
	adoption of energy codes under Subsection (b-1) to have an
	opportunity to comment on the codes under consideration and to have
	the commentary considered by the laboratory in developing its
	recommendations. The office shall consider persons who have an
	interest in adoption of those codes to include:
	(1)  commercial and residential builders, architects
	and engineers;
	(2)  municipal, county, and other local government
	authorities; and
	(3)  environmental groups.
	SECTION 3.02.  Section 388.005, Health and Safety Code, is
	amended to read as follows:
	Sec. 388.005.  ENERGY EFFICIENCY PROGRAMS IN INSTITUTIONS OF
	HIGHER EDUCATION, STATE AGENCIES, AND CERTAIN POLITICAL
	SUBDIVISIONS. (a)  In this section:
	(1)  "Institution of higher education" includes an
	institution of higher education as defined by Section 61.003,
	Education Code, and a private institution of higher education that
	receives funding from the state.
	(2)  "Political[, "political] subdivision" means:
	(A) [(1)]  an affected county; or
	(B) [(2)]  any political subdivision in a
	nonattainment area or in an affected county other than:
	(i) [(A)]  a school district; or
	(ii) [(B)]  a district as defined by Section
	36.001 or 49.001, Water Code, that had a total annual electricity
	expense of less than $200,000 in the previous fiscal year of the
	district.
	(3)  "State agency" means a department, commission,
	board, office, council, or other agency in the executive branch of
	government that is created by the constitution or a statute of this
	state and has authority not limited to a geographical portion of the
	state.
	(b)  Each political subdivision, institution of higher
	education, or state agency shall implement all energy efficiency
	measures that meet the standards established for a contract for
	energy conservation measures under Section 302.004(b), Local
	Government Code, in order to reduce electricity consumption by the
	existing facilities of the entity [the political subdivision].
	(c)  Each political subdivision, institution of higher
	education, or state agency shall establish a goal to reduce the
	electric consumption by the entity [political subdivision] by five
	percent each year for six [five] years, beginning September 1, 2007
	[January 1, 2002].
	(d)  A political subdivision, institution of higher
	education, or state agency that does not attain the goals under
	Subsection (c) must include in the report required by Subsection
	(e) justification that the entity [political subdivision] has
	already implemented all available measures. An entity that submits
	a report under this subsection indicating it has already
	implemented all available measures is exempt from the annual
	reporting requirement of Subsection (e) if a subsequent report
	would indicate no change in status. An entity may be required to
	provide notice that it is exempt to the State Energy Conservation
	Office.
	(e)  A political subdivision, institution of higher
	education, or state agency annually shall report to the State
	Energy Conservation Office, on forms provided by that office,
	regarding the entity's [political subdivision's] efforts and
	progress under this section. The State Energy Conservation Office
	shall provide assistance and information to the entity [political
	subdivisions] to help it [the political subdivisions] meet the
	goals set under this section.
	(f)  This section does not apply to an institution of higher
	education or a state agency if:
	(1)  the State Energy Conservation Office determines
	that, before September 1, 2007, the institution or agency adopted a
	plan for conserving energy under which the institution or agency
	has set a percentage goal for reducing electric consumption; and
	(2)  the institution or agency submits reports on its
	conservation plan not less than quarterly to the governor, the
	Legislative Budget Board, and the State Energy Conservation Office.
	SECTION 3.03.  Subsection (b), Section 44.901, Education
	Code, is amended to read as follows:
	(b)  The board of trustees of a school district shall
	establish a goal to reduce the annual electric consumption by five
	percent each year for six years, beginning September 1, 2007. The
	board of trustees of a school district may enter into an energy
	savings performance contract in accordance with this section.
	SECTION 3.04.  Subsection (d), Section 2155.068, Government
	Code, is amended to read as follows:
	(d)  As part of the standards and specifications program, the
	commission shall review contracts for opportunities to recycle
	waste produced at state buildings, shall develop and update a list
	of equipment and appliances that meet the energy efficiency
	standards of Section 2158.301, and shall assist state agencies in
	selecting products under that section as appropriate.
	SECTION 3.05.  Chapter 2158, Government Code, is amended by
	adding Subchapter F to read as follows:
	SUBCHAPTER F. ENERGY AND EFFICIENCY STANDARDS
	FOR EQUIPMENT AND APPLIANCES
	Sec. 2158.301.  ENERGY CONSERVATION. If available and cost
	effective, the commission or another state agency shall purchase
	equipment and appliances for state use that meet or exceed the
	federal Energy Star standards designated by the United States
	Environmental Protection Agency and the United States Department of
	Energy.
	SECTION 3.06.  (a)  The State Energy Conservation Office
	shall adopt rules implementing a procedure for stakeholder
	participation as required under Subsection (b-2), Section 388.003,
	Health and Safety Code, as added by this article, as soon as
	practicable after the effective date of this Act.
	(b)  The State Energy Conservation Office shall adopt rules
	as necessary to implement Subsection (b), Section 44.901, Education
	Code, as amended by this article, as soon as practicable after the
	effective date of this Act.
	SECTION 3.07.  (a)  The energy conservation standards for
	equipment and appliances under Section 2158.301, Government Code,
	as added by this article, apply to a purchase by a state agency on or
	after the effective date of this Act.
	(b)  The Texas Building and Procurement Commission shall
	develop a list of equipment and appliances under Section 2155.068,
	Government Code, as amended by this article, as soon as practicable
	after the effective date of this Act.
	ARTICLE 4.  IDLING OF MOTOR VEHICLES
	SECTION 4.01.  Subsections (b), (c), and (d), Section
	382.0191, Health and Safety Code, are amended to read as follows:
	(b)  The commission may not prohibit or limit the idling of a
	motor vehicle when idling is necessary to power a heater or air
	conditioner while a driver is using the vehicle's sleeper berth for
	a government-mandated rest period. Idling is not necessary to
	power a heater or air conditioner if the vehicle is within two miles
	of a facility offering external heating and air conditioning
	connections at a time when those connections are available.
	(c)  No driver using the vehicle's sleeper berth may idle the
	vehicle in a residential area as defined by Section 244.001, Local
	Government Code, or in a school zone or within 1,000 feet of a
	hospital or a public school during its hours of operation. An
	offense under this subsection shall be punishable by a fine not to
	exceed $500.
	(d)  This section expires September 1, 2009 [2007].
	ARTICLE 5. TEXAS COMMISSION ON ENVIRONMENTAL QUALITY NOTIFICATION
	REQUIREMENTS
	SECTION 5.01.  Section 382.0516, Health and Safety Code, is
	amended to read as follows:
	Sec. 382.0516.  NOTICE TO STATE SENATOR, STATE [AND]
	REPRESENTATIVE, AND CERTAIN LOCAL OFFICIALS. (a)  On receiving an
	application for a construction permit or an amendment to a
	construction permit, a special permit, or an operating permit for a
	facility that may emit air contaminants, the commission shall send
	notice of the application to the state senator and representative
	who represent the area in which the facility is or will be located.
	(b)  In addition to the notice required by Subsection (a),
	for an application that relates to an existing or proposed concrete
	batch plant, on receiving an application for a construction permit,
	an amendment to a construction permit, an operating permit, or an
	authorization to use a standard permit, the commission shall send
	notice of the application:
	(1)  to the county judge of the county in which the
	facility is or will be located; and
	(2)  if the facility is or will be located in a
	municipality or the extraterritorial jurisdiction of a
	municipality, to the presiding officer of the municipality's
	governing body.
	SECTION 5.02.  The notice provisions under Section 382.0516,
	Health and Safety Code, as amended by this article, apply only to an
	application for a permit that is submitted to the Texas Commission
	on Environmental Quality on or after the effective date of this
	article.
	SECTION 5.03.  This article takes effect September 1, 2007.
	ARTICLE 6. ENFORCEMENT ACTIONS BASED ON INFORMATION PROVIDED BY A
	PERSON
	SECTION 6.01.  Subchapter A, Chapter 7, Water Code, is
	amended by adding Section 7.00251 to read as follows:
	Sec. 7.00251.  INITIATION OF CERTAIN CLEAN AIR ACT
	ENFORCEMENT ACTIONS USING INFORMATION PROVIDED BY A PERSON.  If the
	commission determines that there are multiple violations based on
	information it receives as required by Title V of the federal Clean
	Air Act (42 U.S.C. Section 7661 et seq.) from a person, as defined
	in Section 382.003, Health and Safety Code, only those that require
	initiation of formal enforcement will be included in any proposed
	enforcement action. For all other violations that do not require
	initiation of formal enforcement, the commission may not include in
	the enforcement action the following:
	(1)  violations that are not repeat violations due to
	the same root cause from two consecutive investigations within the
	most recent five-year period; or
	(2)  violations that have been corrected within the
	time frame specified by the commission or for which the facility has
	not had the time specified by the commission to correct the
	violations.
	ARTICLE 7. SOLAR ENERGY DEMONSTRATION PROJECT
	SECTION 7.01.  Subchapter Z, Chapter 39, Utilities Code, is
	amended by adding Section 39.9051 to read as follows:
	Sec. 39.9051.  ENERGY EFFICIENCY DEMONSTRATION PROJECTS FOR
	SOLAR ELECTRIC SYSTEM; GRANT PROGRAM. (a)  The commission by rule
	shall establish grant programs for:
	(1)  a demonstration project for installation of solar
	electric systems for new residential subdivisions;
	(2)  a demonstration project for installation of solar
	electric systems for new or established affordable housing for
	persons with low incomes; and
	(3)  a demonstration project for installation of solar
	electric systems for not more than three small businesses.
	(b)  To qualify for a grant under this section, the solar
	electric system must be a device that:
	(1)  generates electricity using solar resources;
	(2)  has a generating capacity of not more than 1,000
	kilowatts; and
	(3)  is installed with a manufacturer's warranty
	against breakdown or undue degradation for a period of at least five
	years.
	(c)  A demonstration project grant program established under
	this section must provide for full or partial payment of the cost of
	equipment and installation for the solar electric systems. The
	commission shall establish for each grant program a competitive
	bidding process for grant applicants. The commission shall
	consider the value of funding demonstration projects in different
	parts of this state, after considering the demographic and
	geographic diversity of this state.
	(d)  To qualify for a grant under Subsection (a)(1), the
	applicant:
	(1)  must be a person whose primary business activity
	is the building of residential housing developments; and
	(2)  must have installed or must be contractually
	obligated to install qualifying solar electric systems in each
	residence constructed in a residential subdivision.
	(e)  To qualify for a grant under Subsection (a)(2), the
	applicant must have installed or be contractually obligated to
	install a qualifying solar electric system for residential real
	property:
	(1)  appraised in accordance with Section 23.21, Tax
	Code, as affordable housing property; or
	(2)  subject to a contractual obligation that the
	property will be appraised in accordance with Section 23.21, Tax
	Code, as affordable housing property within a reasonable time after
	the grant is received.
	(f)  To qualify for a grant under Subsection (a)(3), the
	applicant must be a small business or owner of a small business that
	meets qualifications adopted by the commission after consideration
	of federal Small Business Administration standards for
	qualification for loans from that administration.
	(g)  The commission shall issue a report to the governor,
	lieutenant governor, and speaker of the house of representatives
	not later than December 1 of each even-numbered year summarizing
	the status of the grant programs established under Subsection (a).
	The report must include the amount of money granted to each
	demonstration project and an evaluation of whether the projects
	demonstrate the economic and ecologic viability of solar electric
	system installations.
	(h)  This section expires December 31, 2010.
	SECTION 7.02.  (a)  The Public Utility Commission of Texas
	may not spend money to implement a demonstration project grant
	program established under Section 39.9051, Utilities Code, as added
	by this article, except for money described by Subsection (b) of
	this section that is appropriated to the commission.
	(b)  The Public Utility Commission of Texas may solicit and
	accept gifts, grants, and other donations from any source to carry
	out the demonstration grant program established under Section
	39.9051, Utilities Code, as added by this article.
	(c)  This section expires December 31, 2010.
	ARTICLE 8.  EFFECTIVE DATE
	SECTION 8.01.  This Act takes effect immediately if it
	receives a vote of two-thirds of all the members elected to each
	house, as provided by Section 39, Article III, Texas Constitution.
	If this Act does not receive the vote necessary for immediate
	effect, this Act takes effect September 1, 2007.
	______________________________	______________________________
	President of the Senate	Speaker of the House
	I hereby certify that S.B. No. 12 passed the Senate on
	March 21, 2007, by the following vote:  Yeas 29, Nays 0;
	May 21, 2007, Senate refused to concur in House amendments and
	requested appointment of Conference Committee; May 24, 2007, House
	granted request of the Senate; May 27, 2007, Senate adopted
	Conference Committee Report by the following vote:  Yeas 30,
	Nays 0.
	______________________________
	Secretary of the Senate
	I hereby certify that S.B. No. 12 passed the House, with
	amendments, on May 17, 2007, by the following vote:  Yeas 145,
	Nays 0, two present not voting; May 24, 2007, House granted request
	of the Senate for appointment of Conference Committee;
	May 28, 2007, House adopted Conference Committee Report by the
	following vote:  Yeas 144, Nays 0, two present not voting.
	______________________________
	Chief Clerk of the House
	Approved:
	______________________________
	Date
	______________________________
	Governor