United States Air and Radiation EPA420-F-00-016 Environmental Protection April 2000 Agency Office of Transportation and Air Quality Regulatory Announcement Fee Waiver for Small-Volume Manufacturers The U.S. Environmental Protection Agency (EPA) is adopting a regulation which waives certification fee payments for small-volume manufacturers of light-duty vehicles, light-duty trucks, and heavy-duty engines. The fee waiver provides regulatory relief to these manufacturers by reducing the front-end expenses required for certification. Background Small volume manufacturers of alternatively fueled vehicles and large- volume manufacturers with low sales of specific products have made numerous requests to streamline and reduce the cost of certification. The manufacturers of alternative fuel vehicles—Compressed Natural Gas (CNG) and Liquid Petroleum Gas (LPG)—also want to make the point that vehicles using alternative fuels not only satisfy the Clean Air Act for "Clean-Fuel Fleet Vehicles" (CFFV), but also satisfy the Executive Order 13031 to reduce the dependency on foreign oil. By to reducing the cost of compliance and streamlining the certification process, EPA provides incentives to these small volume manufacturers and qualifying large-volume manufacturers. These incentives could supply the needs of many fleet owners for both the CFFV program as well as the Executive Order. Highlights of Final Rule Prior to the EPA issuing a certificate of conformity, each manufacturer must pay a fee to the U.S. Treasury that covers the cost of compliance > Printed on Recycled Paper ------- and enforcement activities performed by EPA. EPA is adopting a fee waiver for model years 2000 through 2003 for small-volume manufactur- ers, significantly reducing the cost of compliance for small-volume manufacturers. The key elements of the waiver provisions are: • Certification fees must be paid before the EPA can issue a certificate of conformity to any manufacturer ($23,731 for LDV and $12,584 for heavy-duty engines). For small-volume manufacturers (with sales less than 10,000 units), the payment of these fees prior to production can impose a significant burden. This final rule waives the payment for small-volume manufacturers of vehicles with a gaseous-fuel-only fuel system, thus eliminating one of the certifica- tion burdens. EPA is extending the fee waiver through MY 2003. • Large-volume manufacturers producing fewer than 10,000 dedicated gaseous-fueled vehicles can also apply for this waiver. « The majority of vehicles that will meet the criteria of a gaseous-fuel- only system will be certified to Low Emission Vehicle (LEV) or Ultra-Low Emission Vehicle (ULEV) emission standards. Vehicles with dedicated fuel systems certified to Tier 1 standards will also be eligible. « With the exception of dual-fuel and flexible-fueled vehicles and engines, this waiver will also apply to any vehicle certified to LEV, Inherently Low Emission Vehicle (ILEV), ULEV or Zero Emission Vehicle (ZEV). * For converted vehicles that are dual-fueled or flexible-fuel vehicle there will be a certification fee. This fee, however, will be based on 1 percent of the value added to the vehicle by the conversion. This final rule will have no adverse effects on air quality since all current emissions standards and requirements continue to apply. The majority of vehicles that qualify for the fee waiver provided by this rulemaking will be certified to ULEV levels. This rule is intended to encourage the production of these clean vehicles by reducing the cost associated with certifying them. ------- for Qualifying small-volume manufacturers will realize an immediate cost savings and are very supportive of this change. In addition, large-volume manufacturers can also benefit from this in specific cases. Existing regulations allow "large-volume" manufacturers to classify any engine family(ies) that meet sales volume criteria for small-volume to be classi- fied as such. Therefore, a large-volume manufacturer could take advan- tage of this cost savings, as long as the engine families were dedicated alternative fuel engine families. Of The adoption of this rule will substantially reduce front-end expenses for small-volume manufacturers affected by this rule and for qualifying large-volume manufacturers. EPA estimates that qualifying small- volume and large-volume manufacturers will save about $100,000 during each of the next four model years due to these provisions. This sum may seem insignificant within the automobile manufacturing industry, but for small-volume production (total sales less than 10,000 units) this repre- sents a significant amount of money that must be paid out prior to the start of production. A Notice of Proposed Rulemaking was published on July 20, 1998, with the comment period closing on August 19, 1998. One commenters requested that the comment period be extended. A Notice was published on September 11, 1998, extending the comment period to October 13, 1998. We received 27 submissions during the comment period. For You can access additional documents on clean fuel fleet vehicles elec- tronically on the Office of Transportation and Air Quality Web site at: http ://www. epa.gov/otaq/ccf.htm For further information on this final rule, please contact Clifford Tyree at: U.S. Environmental Protection Agency Office of Transportation and Air Quality 2000 Traverwood Drive Ann Arbor, MI 48105-2498 (734)214-4310 ------- |