Memorandum
Date: July 22, 2025
To: The Honorable Lake County Board of Supervisors
From: Douglas Gearhart, APCO
Subject: Sitting as the Lake County Air Quality Management District Board of Directors Continued Discussion of the Draft Replacement Fee Schedule (Rules 660-668)
Executive Summary:
The Lake County Air Quality Management District (District) is required to follow the legal process outlined in California Health and Safety Code (CA H&SC) in order to adopt new rules or fees, modify existing rules, and repeal rules. This is a continuation of the discussion from the workshop and hearing held on June 10, 2025 and July 15, 2025.
As you know, the District is proposing to repeal the existing fee rules and replace them with a new fee rule and structure. The new structure is intended to provide clarity and better transparency to the District fees. The fee rule proposed is considered a new rule under CA H&SC 41512 .7 and 42311. The structure of the fee is changing significantly, every permit will undergo reassessment for the new structure and a new permit incorporating all the necessary changes and updates will be issued to each source. This review will take upwards of 4 months to process the over 600 existing permitted facilities. The District has not increased fees since 1996, other than implementation of burn permit fees in 2003 and annual CPI adjustments. The industries emitting air pollution affected by these permits have received significant economic advantages for the past 30 years due to the undercharging of actual costs. The proposed fee increase is to bring all sources emitting air pollution to a point where they are paying the cost of the regulatory programs required by law to regulate their contribution to air pollution within the community. The District has carried these programs for many years, but due to increasing requirements and additional mandates, the District is unable to keep up and can not continue to meet our obligations which impacts every member of the community, without a fee increase. Failure to properly regulate air pollution sources increases impacts to the community, increasing medical costs, emergency response costs, and increase illness and early death.
The attachments provided show the costs of implementing fees upon a 4 year schedule and a 5 year schedule for your consideration. The fee revenue is calculated to estimate the high end potential fees paid by existing sources. Some fees may be lower once a full assessment of each permit is complete. Based on the 5 year phase in estimate provided, the increase in Year 1 is unlikely adequate to fully fund an additional staff person. However, we are hopeful that in Year 2 the increase will fully fund an additional staff person. The District anticipates additional staffing increases and the restarting of delayed projects to start in Year 3.
The carryover funds this year in the District budget are higher than prior year's due to salary savings, one time projects that have not yet been completed, and grant funding for air monitoring equipment. The projects include new roofing on the District building (wind storms have caused damage), solar installation, property drainage improvements (due to sections of the building experiencing flooding during heavy rains), siding replacement, as well as other equipment replacement projects, all of which have been delayed due to the staffing shortages we have been experiencing.
The District appreciates your consideration of this matter and believes the 5 year or 4 year phase in plan will greatly assist our efforts to meet obligations while protecting the community and maintaining our healthful air in Lake County.
If not budgeted, fill in the blanks below only:
Estimated Cost: ________ Amount Budgeted: ________ Additional Requested: ________ Future Annual Cost: ________
Purchasing Considerations (check all that apply): ☐ Not applicable
☐ Fully Article X. <https://library.municode.com/ca/lake_county/codes/code_of_ordinances?nodeId=COOR_CH2AD_ARTXPU_S2-38EXCOBI>- and/or Consultant Selection Policy <http://lcnet.co.lake.ca.us/Assets/Intranet/Policy/Policies+$!26+Procedures+Manual/Ch4_2021v2.pdf>-Compliant (describe process undertaken in “Executive Summary”)
☐ Section 2-38 <https://library.municode.com/ca/lake_county/codes/code_of_ordinances?nodeId=COOR_CH2AD_ARTXPU_S2-38EXCOBI> Exemption from Competitive Bidding (rationale in “Executive Summary,” attach documentation, as needed)
☐ For Technology Purchases: Vetted and Supported by the Technology Governance Committee <http://lcnet.co.lake.ca.us/Assets/Intranet/Intranet+Forms/Information+Technology/AdvPlan.pdf> (“Yes,” if checked)
☐ Other (Please describe in Executive Summary)
Consistency with Vision 2028 <http://www.lakecountyca.gov/Government/Directory/Administration/Visioning/Vision2028.htm> (check all that apply): ☐ Not applicable
☐ Well-being of Residents ☐ Public Safety ☐ Disaster Prevention, Preparedness, Recovery
☐ Economic Development ☐ Infrastructure ☐ County Workforce
☐ Community Collaboration ☐ Business Process Efficiency ☐ Clear Lake
Recommended Action: Accept public comment and approve District Staff submittal of proposed rules to ARB and EPA for comment and to bring the final rules back to the Board of Directors for consideration of adoption.