HB2428 - Emissions; reduction credits; counties

Senate Engrossed House Bill emissions; reduction credits; counties State of Arizona House of Representatives Fifty-seventh Legislature Second Regular Session 2026 CHAPTER 93 HOUSE BILL 2428 AN ACT amending sections 49-402, 49-426 and 49-480, Arizona Revised Statutes; RELATING to air quality. (TEXT OF BILL BEGINS ON NEXT PAGE) Be it enacted by the Legislature of the State of Arizona: Section 1. Section 49-402, Arizona Revised Statutes, is amended to read: START_STATUTE 49-402. State and county control A. except as provided in subsection G of this section, the department shall have original jurisdiction over such sources, permits and violations that pertain to: 1. Major sources in any county that has not received approval from the administrator for new source review under the clean air act and prevention of significant deterioration under the clean air act. 2. Smelting of metal ore. 3. Petroleum refineries. 4. Coal fired electrical generating stations. 5. Portland cement plants. 6. Air pollution by portable sources. 7. Air pollution by mobile sources for the purpose of regulating those sources as prescribed by article 5 of this chapter and consistent with the clean air act. 8. Sources that are subject to title V of the clean air act and that are located in a county for which the administrator has disapproved that county's title V permit program if the department has a title V program that has been approved by the administrator. On approval of that county's title V permit program by the administrator, the county shall resume jurisdiction over those sources. B. Except as specified in subsection A of this section, the review, issuance, administration and enforcement of permits issued pursuant to this chapter shall be by the county or multi-county air quality control region pursuant to the provisions of article 3 of this chapter. After the director has provided prior written notice to the control officer describing the reason for asserting jurisdiction and has provided an opportunity to confer, the county or multi-county air quality control region shall relinquish jurisdiction, control and enforcement over such permits as the director designates and at such times as the director asserts jurisdiction at the state level. The order of the director which that asserts state jurisdiction shall specify the matters, geographical area, or sources over which the department shall exercise jurisdiction and control. Such state authority shall then be the sole and exclusive jurisdiction and control to the extent asserted, and the provisions of this chapter shall govern, except as provided in this chapter, until jurisdiction is surrendered by the department to such county or region. C. Portable sources under jurisdiction of the department under subsection A, paragraph 6 of this section may be required to file notice with the director and the control officer who has jurisdiction over the geographic area that includes the new location before beginning operations at that new location. D. Notwithstanding any other law, a permit issued to a state regulated state-regulated source shall include the emission standard or standard of performance adopted pursuant to section 49-479, if such standards are more stringent than those adopted by the director and if such standards are specifically identified as applicable to the permitted source or a component of the permitted source. Such standards shall be applied to sources identified in subsection A, paragraph 2, 3, 4 or 5 of this section only if the standard is formally proposed for adoption as part of the state implementation plan. E. The regional planning agency for each county which that contains a vehicle emissions control area shall develop plan revisions containing transportation related TRANSPORTATION-related air quality control measures designed to attain and maintain primary and secondary ambient air quality standards as prescribed by and within the time frames specified in the clean air act. In developing the plan revisions, the regional planning agency shall consider all of the following: 1. Mandatory employee parking fees. 2. Park and ride programs. 3. Removal of on-street parking. 4. Ride share programs. 5. Mass transit alternatives. 6. Expansion of public transportation systems. 7. Optimizing freeway ramp metering. 8. Coordinating traffic signal systems. 9. Reduction of traffic congestion at major intersections. 10. Site specific site-specific transportation control measures. 11. Reversible lanes. 12. Fixed lanes for buses and carpools. 13. Encouragement of pedestrian travel. 14. Encouragement of bicycle travel. 15. Development of bicycle travel facilities. 16. Employer incentives regarding ride share programs. 17. Modification of work schedules. 18. Strategies for controlling the generation of air pollution by nonresidents of nonattainment or maintenance areas. 19. Use of alternative fuels. 20. Use of emission control devices on public diesel powered vehicles. 21. Paving of roads. 22. Restricting off-road vehicle travel. 23. Construction site air pollution control. 24. Other air quality control measures. F. Each regional planning agency shall consult with the department of transportation to coordinate the plans developed pursuant to subsection E of this section with transportation plans developed by the department of transportation pursuant to any other law. g. After RECEIVING a voluntary request from an applicant, A county may claim concurrent jurisdiction over both of the following for the sole purpose of issuing, revising or enforcing a permit to certify emission reduction credits pursuant to section 49-410: 1. Components of a portable source within the county's jurisdiction. 2. mobile sources WITHIN the county's jurisdiction. h. Notwithstanding any other law, an applicant's election to PARTICIPATE in any program that results in the certification of emission reduction credits PURSUANT to SUBSECTION G of this section is VOLUNTARY. if, after the effective date of this amendment to this section, PARTICIPATION of an on-road vehicle fleet in the EMISSION reduction credit program becomes MANDATORY PURSUANT to an act of the legislature, administrative rule or state implementation plan commitments, a control officer may not certify any new SURPLUS emission REDUCTION credits as PROVIDED in subsection g, PARAGRAPH 2 of this section. Only mobile source fleets with a base of operations in a nonattainment area are ELIGIBLE for certification pursuant to subsection G, paragraph 2 of this section. I. after a county issues a permit or permit REVISION THAT CERTIFIES emission reduction credits PURSUANT to subsection G of this section, the permit or permit REVISION are binding on the applicant. END_STATUTE Sec. 2. Section 49-426, Arizona Revised Statutes, is amended to read: START_STATUTE 49-426. Permits; duties of director; exceptions; applications; objections; fees; definitions A. A permit shall: 1. Be issued by the director in compliance with the terms of this section. 2. Be required for any person seeking a compliance extension pursuant to section 49-426.03, subsection B, paragraph 3 and section 112(a)(5) of the clean air act and for any person beginning actual construction of or operating any source, except as prescribed in subsection B of this section or section 49-426.01. B. The provisions of This section shall not apply to motor vehicles, to agricultural vehicles or agricultural equipment used in normal farm operations, or to fuel burning equipment which that , at a location or property other than a one or two family residence, is rated at less than one million British thermal units per hour. The director may establish by rule additional sources or classifications of sources for which a permit is not required and pollutant-emitting activities and emissions units at permitted sources that are not required to be included in the permit. The director shall not adopt such rules unless the director makes a written finding with supporting facts that the exempted source, class of sources, pollutant-emitting activities or emissions units will have an insignificant adverse impact on air quality. In adopting these rules, the director may consider any rule that is adopted by the administrator pursuant to section 502 of the clean air act and that exempts one or more source categories from the requirement to obtain a permit under title V of the clean air act. If an applicant voluntarily submits a permit application, section 49-104 and this subsection do not preclude the director or the control officer from issuing a permit or permit revision that requires reductions in emissions from motor VEHICLES, agricultural vehicles or equipment, mobile sources or nonroad ENGINES in a permit that the applicant agreed to at the time of issuance. C. Every application for a permit shall be filed in the manner and form prescribed by the director, and shall contain all the information necessary to enable the director to make the determination to grant or deny such application. The director shall establish by rule requirements for permit applications, including the standard application form for title V sources. The director shall establish by rule requirements for applications for general permits. An application for a permit issued pursuant to title V of the clean air act shall include a compliance plan that describes how the applicant will comply with all of the applicable requirements of this chapter and the clean air act, including a schedule of compliance and a schedule under which progress reports will be submitted to the director at least every six months. The director may require that such application include all sources that are used or to be used by the applicant in a certain process or a single facility or location. Before acting on an application for a permit, the director may require the applicant to furnish further information or further plans or specifications. The director shall act, within a reasonable time, on such application and shall notify the applicant in writing of the proposed approval or denial of such application, except that the director may have a reasonable period of time in which to gather information, inspect premises, and issue such permits. The director shall adopt rules that establish procedures for determining when applications are complete, for processing applications and for reviewing permit actions. The director shall also establish by rule criteria for determining reasonable times for processing permit applications. Rules adopted pursuant to this subsection for permits issued pursuant to title V of the clean air act shall conform to the requirements of section 505(a) of the clean air act. D. The director shall give notice of a proposed permit for a source required to obtain a permit pursuant to title V of the clean air act once each week for two consecutive weeks in two newspapers of general circulation in the county in which the source is or will be located. The notice shall describe the proposed permit and air contaminants to be emitted and shall state that any person may submit comments on the proposed permit and may request a public hearing. The director shall require the applicant at the time of the first notice to post the site where the source is or may be located. If permitted by federal, state and local law, the posting shall be prominently placed at a site that is under the applicant's legal control and that is adjacent to the nearest public roadway. The posting shall be visible to the public using the public roadway and shall contain the information in the notice that is published by the director. If a public hearing is requested, the director shall require the applicant to place an additional posting that provides notice of the public hearing. A posting shall be maintained until the public comment period on the proposed permit is closed. The director shall make available to the public notices of proposed permits. Each public notice that is issued under this chapter shall be mailed to the permit applicant, to the affected federal, state and local agencies and to those persons who have requested in writing copies of proposed permit action notices. During the public comment period, any person may submit a request to the department to conduct a public hearing for the purpose of receiving oral or written comments on the proposed permit. A written comment shall state the name and mailing address of the person, shall be signed by the person , his or the person's agent or his attorney and shall clearly set forth reasons why the permit should or should not be issued. Grounds for comment are limited to whether the proposed permit meets the criteria for issuance prescribed in this section or in section 49-427. The department shall consider and prepare written responses to all comments received during the public comment period , including comments made at a public hearing conducted by the department. At the time a final permit decision is made, copies of the department's responses shall be made available to the applicant and any person who commented on the proposed permit. E. Permits or revisions issued pursuant to this section or section 49-426.01 may be issued subject to such terms and conditions as are consistent with the requirements of this article, article 1 of this chapter and the clean air act and are found by the director to be necessary, following public notice and an opportunity for a public hearing as provided in subsection D or H of this section or in section 49-426.01, and subject to payment of a reasonable fee to be determined as follows: 1. For a source that is required to obtain a permit pursuant to title V of the clean air act, the director shall establish by rule a system of fees that is consistent with and equivalent to that prescribed by section 502 of the clean air act. These rules shall prescribe procedures for increasing the fee each year by the percentage , if any , by which the consumer price index for the immediately preceding calendar year exceeds the consumer price index for calendar year 1989. 2. For a facility that is required to obtain a permit pursuant to this chapter but that is not required to obtain a permit pursuant to title V of the clean air act, the director shall determine a fee based on the total actual cost of processing the permit application, but not exceeding twenty-five thousand dollars more than $25,000 . The director shall establish an annual inspection fee, not to exceed the average cost of inspection. The director shall adopt, by rule, criteria for determining fees and for public hearings. F. except as provided in subsection Q of this section, permits issued pursuant to this section shall be issued for a period of five years. G. Except as provided in subsection H of this section, any person burning used oil, used oil fuel, hazardous waste or hazardous waste fuel in any machine, incinerator or device shall first obtain a permit from [Text truncated for display. Full text available on LegiScan.]