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- The San Diego Air District Uses Vehicle Registration Fees to Subsidize Its Permitting Program
- The San Diego Air District and the District Board Have Not Taken Adequate Steps to Foster Public Engagement
- The San Diego Air District Cannot Provide Accurate Complaint Information and Has Not Ensured That All Complaints Are Properly Addressed
- Other Areas We Reviewed
The San Diego Air District Uses Vehicle Registration Fees to Subsidize Its Permitting Program
- The San Diego Air District has not ensured that its permit fees are sufficient to pay for the costs of its permitting program. In fiscal year 2018–19, the district collected $8.7 million in permit fees but spent $12.5 million on the permitting program.
- Instead of raising its permit fees, the San Diego Air District used vehicle registration fees to offset some of the costs of its permitting program. Although it has broad discretion over the use of vehicle registration fees, using these funds to subsidize the cost of permits does not advance the district's mission of improving county air quality.
The San Diego Air District Has Not Charged Sufficient Fees to Pay for the Costs of Its Permitting Program
As the Introduction describes, the San Diego Air District's permitting program requires owners of certain types of equipment that emit air contaminants to obtain permits. The district's permitting program is responsible for performing activities such as evaluating the completeness of permit applications, processing permit applications, and issuing an operating permit if the equipment passes an on-site inspection. Before processing applications, the district requires applicants to pay established fees which are used for the costs of the permitting program. County policy requires departments to recover the full cost of services they provide through contracts, fees, or grant funds. The San Diego Air District states that it voluntarily follows this policy, despite its status as a special district.A special district is an agency formed pursuant to state law for the local performance of government functions within a limited boundary. If the district proposes changes in the fees, it must submit information to the county Auditor and Controller's Office (county auditor) documenting the support for its calculation of the change. In addition, the Government Finance Officers Association—an association of federal, state, and local finance officials—also recommends that state and local agencies calculate the full cost of providing services as the basis for setting fees and that they provide an explanation of their rationale if they do not recover the full cost of a good or service.
Despite such guidance, the San Diego Air District charges fees that are insufficient to pay for the full cost of its permitting program, thereby requiring it to subsidize that cost with funds from other sources. For example, in fiscal year 2018–19, the district collected $8.7 million in permit fee revenue. Although its finance officer stated that the district does not calculate the actual costs for administering its permitting program, the district estimated that the cost of the divisions directly involved in the permitting process would be $10.8 million for fiscal year 2018–19. Based on actual expenditure data, we calculated that the costs of the divisions directly involved in the permitting program were at least $9.5 million. However, neither the district's estimate nor the $9.5 million we calculated included the costs incurred by its support services, administrative, and public information divisions (administrative costs) that should be associated with the permitting program. Because administrative costs should be assigned to the operations receiving the related administrative services, a portion of the San Diego Air District's administrative costs should be allocated to the permitting program. For example, the district's support services division provides a variety of services—including permit renewal invoicing, accounting, and fleet management—that the permitting program benefits from and should pay its fair share. For fiscal year 2018–19, the district's total administrative costs were $6.7 million, and our calculations concluded that $3 million of these costs are attributable to the permitting program.The San Diego Air District's financial data show that the costs for the divisions participating in the permitting process made up nearly 45 percent of its total nonadministrative costs. Multiplying its total administrative costs of $6.7 million by this percentage results in $3 million of costs that can be attributed to the permitting program. Thus, as Table 1 shows, we calculated the total cost of the permitting program to be $12.5 million.
Although the district agreed that overhead costs could be calculated this way, it defended the reasonableness of its estimate for the cost of permit fees because it believes it complied with county policies. In fact, the county auditor informed the San Diego Air District that the methodology of its cost-recovery proposal for its permit fees for fiscal year 2018–19 was consistent with the county's cost‑recovery policy. However, that calculation included a figure that the district describes as a "revenue offset." The calculation the district submitted to the county for fiscal year 2018–19 included a total of $6.6 million in vehicle registration fees designated as the revenue offset. The majority of the offset was subtracted from the district's estimated administrative costs, which reduced the amount of the permitting fees.
The San Diego Air District's assistant director (assistant director) stated that in the 1990s the district board directed the district to use vehicle registration fees to subsidize permit fees.The district board appointed the assistant director to the role of interim director in June 2020, upon the executive director's retirement. In this report, we refer to these individuals by the titles they held during the period of our audit. Further, the San Diego Air District's executive director (executive director) stated that the district believes that county policy does not require that the permitting program recover all of the costs associated with its activities, as long as the district's total costs are covered by revenue sources other than the county's general fund. However, as we discuss in more detail below, the district's decision to use vehicle registration fees to cover the costs of its permitting program has impaired its ability to improve air quality.
The San Diego Air District Collected Nearly $4 Million Less in Permit Fees Than
the Permitting Program Cost in Fiscal Year 2018–19
|Permit Fee Deficit|
|Permit Fee Revenue||$8.7|
Source: San Diego Air District financial data and interviews with district staff.
Note: The costs for and fee revenue from the district's asbestos permitting activities are included in this table because we could not clearly differentiate between the costs related to asbestos permits and other permits in the financial data we obtained. Fee revenue for asbestos permits was approximately $800,000 in fiscal year 2018–19.
The significant difference between the San Diego Air District's permit revenue and expenditures—which it is using vehicle registration fees to cover—stems from the district's reluctance to increase permit fees. As the Introduction describes, state law generally allows the district to increase existing permit fees by up to 15 percent each fiscal year but limits those fees to the actual costs of its permitting program in the prior fiscal year, adjusted for the change in the annual California consumer price index. Before an increase in fiscal year 2017–18, the San Diego Air District had previously updated permit fees in 2011. From fiscal years 2017–18 through 2019–20, it proposed increases in both initial permit fees and renewal fees that it estimated would increase revenue by an average of 4 percent per year. However, the district would need to significantly increase permit fees to pay for the full costs of the permitting program in the absence of other funding sources. Had the San Diego Air District's fees reflected its actual permitting process costs in fiscal year 2018–19, we estimate that those fees would have been 44 percent more than the amounts that the district charged. For context, such an increase would have resulted in the price of an initial permit for certain gas stations increasing from about $2,350 to $3,384. Because of the legal limits on fee increases, such increases would have to be phased in over several years.
The assistant director acknowledged that if the district did not use vehicle registration fees to subsidize the permitting program, it would have to increase permit fees or identify other sources of revenue to cover its actual permitting program costs. The district is in the process of hiring a consulting firm to review its permit fee methodology and provide suggestions for improvements. In the meantime, the district developed a draft fee calculation for fiscal year 2020–21 that proposes increasing revenue from initial permit fees and permit renewal fees by 1.6 percent and 8.8 percent, respectively. This calculation projects that the San Diego Air District will still need more than $5 million in vehicle registration fees to offset the costs of the permitting process. Until the district updates its calculation to remove the revenue offset component, it will continue to undercharge for permit fees and will require funds from other sources to subsidize the cost of the permitting program.
Top 10 Most Ozone-Polluted Metropolitan
Areas in the United States in 2019
- Los Angeles-Long Beach, CA
- Visalia, CA
- Bakersfield, CA
- Fresno-Madera-Hanford, CA
- Sacramento-Roseville, CA
- San Diego-Chula Vista-Carlsbad, CA
- Phoenix-Mesa, AZ
- San Jose-San Francisco-Oakland, CA
- Houston-The Woodlands, TX
- New York-Newark, NY-NJ-CT-PA
Source: The American Lung Association's report State of the Air 2019.
The San Diego Air District's Use of Vehicle Registration Fees to Subsidize Its Permitting Program Has Resulted in Less Funds for Reducing Mobile Emissions
Although the San Diego Air District has primary responsibility for controlling air pollution from stationary sources, its mission is to improve air quality to protect public health and the environment. As the text box shows, an American Lung Association report found that San Diego was the sixth most ozone-polluted metropolitan area in the country in 2019. Despite significant reductions in the county's ozone pollution from 2000 to 2015, CARB estimated that the San Diego region must reduce daily emissions of ozone-causing pollutants by another 26 tons to meet federal air quality standards. However, as Figure 6 shows, the stationary sources for which the district has primary responsibility produced only 4 tons of such pollutants per day in 2019. As a result, even if the San Diego Air District were able to eliminate all pollution from stationary sources, the region would still not meet the federal standards. In contrast, mobile sources—such as cars, trucks, and off-road equipment—are estimated to have contributed 82 tons of ozone-causing pollutants on average each day during 2019. Thus, to meet federal air quality standards, the San Diego region will need to reduce ozone-causing emissions from mobile sources.
The Stationary Sources That the District Regulates Contribute Only a Small Proportion of Ozone-Causing Emissions
Source: CARB California Emissions Projection Analysis Model emissions inventory 2019 and interviews with CARB staff.
Notes: Oxides of nitrogen transform into ozone when they react with sunlight and other gases.
CARB uses summer estimates for ozone planning because they reflect the conditions when higher ozone levels occur in the Southern California region.
* Area sources include residential fuel combustion and outdoor burning.
As Figure 7 shows, the San Diego Air District spent only $2.2 million of the $12.9 million it received in vehicle registration fees in fiscal year 2018–19 on projects that were related to mobile emissions, such as diesel truck inspections. During this same period, it spent $1.2 million of its vehicle registration fees on divisions directly involved in its permitting program. Further, it appears to have used some of the funds that it allocated to its administration and administrative support divisions—which received $4.3 million in vehicle registration fees—for the permitting program. As a result, the amount of vehicle registration fees the district used to fund the permitting process was even greater than the amount Figure 7 shows.
Although the San Diego Air District's use of the vehicle registration fees to support its permitting process for stationary sources is allowable under state law, that law changed a number of times over the past three decades. The 1990 state law allowing local air districts to receive a portion of the fees paid for each vehicle registered, generally limited the districts' use of those fees to projects to reduce mobile emissions and related purposes. Further, it required the local air districts to report to CARB on their use of the funds. However, in 2004 the Legislature repealed the reporting requirement. In addition, the Legislature amended the law in 2015 to give most local air districts discretion to use these funds to meet and maintain air quality standards without requiring them to focus solely on mobile emissions. However, without a requirement for local air districts to report on their use of vehicle registration fees, it is unclear how the public would be informed of the use of these funds. CARB also acknowledged the usefulness of such a requirement. According to CARB's chief counsel, one of CARB's goals is to promote transparency, and requiring local air districts to annually report on vehicle registration fee expenditures would both allow CARB to be aware of the district's efforts and help members of the public monitor their respective districts' decisions for the use of those fees.
The San Diego Air District Spent Only $2.2 Million of Fiscal Year 2018–19 Vehicle Registration Fee Revenue for Mobile Emissions-Related Uses
Source: San Diego Air District's financial data and interviews with district staff.
* Total revenue for fiscal year 2018–19 includes $353,000 in interest.
By allocating vehicle registration fees to support its permitting program, the San Diego Air District limits opportunities to address emissions from mobile sources, the largest contributor to the region's ozone levels. Although the San Diego Air District verified the revenue and cost amounts that we used in calculations showing that its permitting program operates at a loss, its assistant director stated that because air quality suffers due to mobile sources, the district has sought more emission reductions from stationary sources to compensate. However, the level of ozone-causing emissions from stationary sources has not changed significantly during the past 10 years, and even a large percentage decrease in such emissions would represent a minor contribution to meeting ozone standards. As we previously discuss, stationary sources in the region produced only 4 tons of ozone-causing emissions per day in 2019, while mobile sources contributed 82 tons per day, or nearly 95 percent of all such emissions. Because the necessary reductions are six times the total amount of emissions caused by stationary sources, the region will never be able to meet the standards solely through emissions reductions from stationary sources. CARB anticipates that additional emissions reductions will allow the region to meet federal ozone standards; however, it does not project doing so for another 12 years.
Consequently, the approach described by the assistant director cannot provide sufficient emissions reductions, and the San Diego Air District's continued use of vehicle registration fees to subsidize permits for stationary sources is not an effective use of these funds, nor does it contribute to the region's ability to meet federal air quality standards.
State law specifies how certain other local air districts must spend their vehicle registration fees, including requiring that they use a minimum proportion for the purpose of addressing mobile emissions. For example, in fiscal year 2018–19, the Sacramento Metropolitan Air Quality Management District (Sacramento Metropolitan Air District) received $5 million in vehicle registration fees, all of which it had to use to implement reductions in mobile emissions. Similarly, state law requires that the South Coast Air Quality Management District allocate at least 70 percent of the vehicle registration fees it receives—which totaled nearly $55 million in fiscal year 2016–17—for activities to reduce mobile emissions and related activities. By raising permit fees to the level necessary to fully pay for the permitting program and using a greater proportion of its vehicle registration fees to address emissions from mobile sources, the San Diego Air District could advance the State's efforts to meet federal air quality standards in the San Diego region and improve the air quality for San Diego County residents. In the next section, we identify some of the programs and resources that the district could support with its vehicle registration funds to reduce mobile emissions.
In addition, the San Diego Air District also chose not to take advantage of a state-funded opportunity to reduce mobile emissions in the county. Specifically, the district did not initially participate in the expansion of a state program that allowed districts to apply for funds beginning in fiscal year 2016–17 to provide subsidies to lower‑income drivers in disadvantaged communities who dispose of their older vehicles (clean cars program). Drivers may use the subsidies to purchase certain hybrid and electric vehicles or pay for rideshares or public transportation. According to the assistant director, the executive director decided not to pursue the funds because staff were concerned that the district would not be reimbursed for the cost of setting up and administering the program.
However, after learning that the district had not applied for this program, one district board member was concerned that the district was not leveraging a funding opportunity to address the region's air quality. He subsequently worked with district staff to identify why the district was not implementing the program. According to the assistant director, the district obtained approval from CARB to use funds from another source to pay for the cost of developing the program. In October 2019, the district board voted to approve implementation of the program. The San Diego Air District submitted an implementation plan for the program in February 2020, and the assistant director indicated that the district will complete the grant application process following CARB staff's approval of that implementation plan. However, given that vehicles are the largest source of the emissions that have caused the San Diego region to fail to meet federal ozone standards, we expected to find that district staff had actively pursued this program from the time the district first became eligible to participate in it.
To increase the transparency of, and promote accountability for, the use of the vehicle registration fees that the public pays, the Legislature should require that each local air district submit an annual report to CARB detailing how it used the vehicle registration fees it received. Both CARB and each local air district should be required to provide this information to the public on their websites.
To encourage the San Diego Air District to accurately account for its costs, operate efficiently, and effectively use vehicle registration fees, the Legislature should require that the San Diego Air District use at least 90 percent of the vehicle registration fees it receives for projects related to mobile emissions—roughly the proportion of ozone-causing emissions from mobile sources in the region—and it should further require that the San Diego Air District publicly disclose the disposition of any vehicle registration fees it does not use to address mobile emissions.
San Diego Air District
To ensure that it is leveraging all funding opportunities to address the region's air quality, the San Diego Air District should periodically evaluate all available state and federal grants to reduce mobile emissions and notify the district board if it decides not to pursue such programs.
To ensure that the permit fees it charges are sufficient to pay for its permitting program, the San Diego Air District should do the following by December 2020:
- Establish a methodology to calculate the full cost of its permitting program, based on its actual expenditures and administrative costs, and perform this calculation each year.
- Monitor the impact of the COVID-19 pandemic on San Diego County's economy and, when economic conditions allow, propose to the district board that it increase fees annually by the maximum percentage allowed until the district's revenue from permit fees is equal to the full cost of the permitting program.
The San Diego Air District and the District Board Have Not Taken Adequate Steps to Foster Public Engagement
- Despite its failure to meet federal air quality standards, the San Diego Air District has not taken advantage of the methods that other districts use to encourage public engagement in improving air quality.
- The district board has not used its public meetings to deliberate on decisions related to improving regional air quality. As a result, it has limited transparency and reduced opportunities for the public to play a role in its decision-making process.
- The district board has not ensured that the advisory committee on whose advice it relies has complied with the State's public meeting requirements. Further, the district board lacks the perspective of relevant stakeholders because it has not taken steps to publicize and fill vacant positions on the committee.
Two Categories of Encouraging Public Participation
Public outreach involves informing the public of air quality issues and may include sharing information using the following communications tools:
- Fact sheets
- News releases
- Social media
Public engagement involves soliciting input from the public, including obtaining feedback, and may be accomplished through the following:
- Opportunities for public comment on regulatory and permitting policies at:
- Board meetings
Source: EPA handbook: Better Decisions Through Consultation and Collaboration and the Bay Area Air District's public participation plan.
The San Diego Air District Has Not Adequately Promoted Public Engagement in Improving Air Quality
The San Diego Air District has not consistently ensured public participation in its processes for improving air quality. As the text box shows, the methods available to local air districts to promote public participation can be divided into two categories—public outreach and public engagement. As Table 2 shows, we compared the San Diego Air District's public participation activities to those of two other large air districts—the Sacramento Metropolitan Air District and the Bay Area Air Quality Management District (Bay Area Air District)—and found that the San Diego Air District uses some of the same public participation activities that the other districts use. However, the Bay Area Air District uses methods to improve public participation that the San Diego Air District has not implemented, some of which have a demonstrable impact on reducing air pollution.
To guide its approach to public engagement, the Bay Area Air District has produced a public participation plan. This plan, which the Bay Area Air District updates intermittently, details how residents can engage with its efforts to improve air quality. The public participation plan describes a variety of activities that the Bay Area Air District draws from when conducting public participation activities. It also describes specific tools and options that the district can use for public outreach and public engagement. For example, the Bay Area Air District uses outreach tools such as Twitter to publicize opportunities for public engagement, like promoting opportunities for public comment at rule-making and air monitoring workshops. However, according to its assistant director, the San Diego Air District has not created such a plan. In addition, the Bay Area Air District has a community engagement division that employs staff to perform both public outreach and public engagement.
The San Diego Air District Does Not Take Advantage of Some Public
Participation Activities Used by Other Air Districts
|Public Participation Plan||NO||NO||YES|
|Spare the Air Program||NO||YES||YES|
|Email Subscriber List||YES||YES||YES|
|Social Media Emphasis on Public Participation||NO||NO||YES|
|Workshop for Public Input||YES||YES||YES|
Source: Air district websites, analysis of air district Twitter activity between October 1 and December 31, 2019, and interviews with air district staff.
Although the San Diego Air District employs workshops and surveys for public engagement, it does not have a plan to organize its participation efforts, nor does it use social media to encourage public engagement as the Bay Area Air District does. According to the assistant director of the San Diego Air District, the county centralized communications efforts several years ago for all county departments, including the district. He explained that this centralization has made the district's public outreach efforts more difficult because it eliminated the district's public outreach staff positions. As a result, the district does not have staff specifically dedicated to public outreach efforts. According to the assistant director, the one staff member responsible for the San Diego Air District's outreach activities, among other responsibilities, primarily focuses on public information efforts, such as promoting district programs, rather than public engagement. Although the assistant director stated that the San Diego Air District is in the process of hiring additional staff for public communications, it is only in the preliminary stages of this process.
In addition, both the Bay Area Air District and the Sacramento Metropolitan Air District have incorporated Spare the Air programs into their outreach efforts, while the San Diego Air District has not. Spare the Air programs provide air quality forecasts and promote alternatives to driving during days with high pollution. The Bay Area Air District reported that in 2019 its Spare the Air campaign resulted in the reduction of more than 59 tons of pollutants in that year.The Bay Area Air District calculated the reduction by analyzing the combined reductions in emissions of reactive organic gases, oxides of nitrogen, and other particle pollution. It also reported that in fiscal year 2018–19, the Spare the Air program was the most cost-effective project for reducing emissions that it funded from vehicle registration fees. Efforts such as these demonstrate the potentially significant impact resulting from educating the public about how their choices affect air pollution and how alternative activities can reduce air pollution. Furthermore, since the San Diego region has failed to meet ozone standards, a Spare the Air program that is focused on reducing emissions could improve the region's ozone compliance status.
The assistant director stated that the district could evaluate the usefulness of a Spare the Air program; however, he also stated that the executive director believes a Spare the Air program may not be an appropriate approach for San Diego because its ozone levels are generally good with the exception of some inland portions of the county that experience higher levels of ozone during the summer. He also expressed concern that a Spare the Air designation for the entire county would be misleading to the public. However, CARB's review of the district's ozone attainment plan noted that the ozone that causes the elevated levels is transported inland from the coastal areas. As a result, a Spare the Air program to reduce ozone‑causing emissions at their source, regardless of where the excessive levels are measured, would likely contribute to the region's ability to meet ozone standards.
As we discuss in the Introduction, state law recently created a new board structure for the San Diego Air District to make the district more responsive to the region's residents and businesses. According to the law's author, the board's existing structure does not reflect the diversity of county residents. As the San Diego Air District prepares for its new governing board, the district has an opportunity to reassess its methods of encouraging public participation and to propose implementing best practices of other air districts. The changes to state law make clear that the Legislature intends for the San Diego Air District to provide increased opportunities for public engagement. If the district does not dedicate additional staff and resources to solicit public input on air quality issues, it will miss a significant opportunity to restructure its operations to be responsive to the needs of county residents and businesses.
The District Board's Decision-Making Practices Have Reduced Transparency
The district board has not used its public meetings to deliberate on decisions regarding improving regional air quality, despite the fact that doing so would promote transparency and demonstrate its commitment to including the public in its decision-making process. From fiscal years 2016–17 through 2018–19, the district board met an average of about 10 times per year, and for the meetings we selected, it complied with the legal public meeting requirements that we reviewed—including timely announcement of meeting agendas, and that a quorum of members was established before it took action on agenda items. Generally, its meeting agendas consisted of items such as approving the district's budget, authorizing the district to execute grant agreements, and allowing the release of public reports. However, in all the meetings during the period we reviewed, the district board approved 89 percent of all agenda items it considered through a parliamentary mechanism known as consent, which generally allows it to approve all of the items on its consent agenda without discussing the issues during the meeting unless a member of the public or the board specifically asks to remove an item from the consent agenda.
Because its use of consent allowed it to vote on the items without publicly discussing them on an individual basis, the board members' deliberations were not fully transparent. In fact, it approved only four agenda items during this time frame without using consent—including the San Diego Air District's budgets for fiscal years 2018–19 and 2019–20 and a May 2019 decision that directed the district to evaluate the impact on public health of reducing air pollution threshold levels. To promote public trust, government should be transparent, and stakeholder involvement can improve the quality of policies. However, practices such as choosing not to discuss decisions during board meetings can reduce the transparency of government actions and may discourage public involvement. In fact, data maintained by the county's clerk of the board of supervisors indicate that the district board received requests from the public to speak in only three of the 31 meetings it held from fiscal years 2016–17 through 2018–19.
The San Diego Air District has been criticized for its failure to encourage public involvement in its decisions in the past. In a 2008 review, the EPA found that the district had not adequately reached out to certain communities with respect to permitting and that it had issued notices of proposed permits in a business-focused publication that had limited circulation among the general public. The EPA expressed concern that the district never received any public comments on proposed Title V permits and suggested that the reason for a lack of input could be in part because it had not used effective means to notify the public about such permits. To remedy this concern, the EPA recommended using other methods of informing the public of pending permits.
When we asked two current district board members why the board meetings included so little discussion on air quality issues, one member explained that the district board has adopted most agenda items through consent because it has a high level of confidence in the San Diego Air District's staff and director. The board member also stated that the San Diego Air District has been able to reach consensus with stakeholders in regard to issues such as new rules, the budget, fees, and the regional and state plans. The other district board member stated that the board meetings rarely received public comments. However, based on his recent experience at a public meeting in the San Diego area that CARB hosted, he believes that the community wants to participate. He stated that the board could be more proactive in engaging with the public regarding air quality. He also agreed that the district board has not proactively provided direction to the San Diego Air District or engaged with the district to pursue improvements in air quality.
This approach to making critical decisions does not align with the role of a governing board. According to state law, public boards should conduct their actions with transparency, and members of the public should generally be provided an opportunity to directly address the board during the decision-making process. Although the district board did not prohibit the public from speaking at its meetings, its practice of making decisions through consent did not foster an environment that encourages public comment or participation. To accomplish these goals, it is critical that public boards deliberate openly when making their decisions. Until the district board embraces these practices, it risks failing to ensure that the public has an appropriate role in its decision making.
The District Board Has Not Ensured That Its Advisory Committee Includes Critical Stakeholders and Complies With Public Meeting Requirements
Rather than discussing issues at its meetings, the district board has instead relied on recommendations from an advisory committee that has consistently failed to comply with state public meeting requirements and whose composition does not reflect its intended membership. The district board could have fostered stakeholder participation through the advisory committee it created for the purpose of involving representatives of certain groups, but it failed to ensure that the committee membership included all of the additional perspectives it was intended to represent. As the Introduction explains, the purpose of the advisory committee is to provide recommendations to the San Diego Air District and the district board regarding the San Diego Air District's annual budget, permit fees, annual progress reports, and regulatory changes. For example, the advisory committee recommended changes to county rules regarding asbestos removal and, citing that recommendation, the district board subsequently approved the rule change on consent.
The advisory committee consists of nine members—five members nominated by the board, two members nominated by environmental organizations, and two members nominated by business interests, one of which should represent small businesses and one of which should represent larger businesses. We refer to the four seats representing environmental and business interests as stakeholder seats. However, according to an assistant clerk of the board at the county board of supervisors, one of the seats for members nominated by environmental organizations has not been filled in almost 30 years, the other has been vacant for more than 24 years, and the seat for a representative of small businesses has been vacant for more than 12 years, as Figure 8 shows.
The assistant director pointed us to an annual county report listing vacancies on boards, committees, and commissions, but we found that from December 2015 through December 2019, none of the county's annual reports listed these vacant stakeholder seats. Further, when we reviewed a selection of the county's monthly vacancy reports from 2019, none included the stakeholder seats. We discussed this issue with a district board member who confirmed that the advisory committee vacancies have not been posted in the monthly vacancy reports and that he was working with the clerk of the county board of supervisors to rectify the situation. The county board of supervisors' failure to publicize the advisory committee's vacancies is problematic. The committee's intended composition suggests that its purpose is to provide the perspective of other stakeholders in the field of air pollution. However, for many years, the district board relied on the recommendations of a committee whose composition did not align with its intended purpose.
The San Diego Air District Board Failed to Ensure That Its Advisory Committee Included Members Representing Stakeholder Perspectives
Source: Interviews with county staff; and San Diego County Boards', Commissions', and Committees' Member History Reports.
In addition, the district board did not provide appropriate oversight to ensure that the advisory committee complied with state public meeting requirements. The advisory committee is subject to these requirements, which include the need to have a quorum—or a majority of members—present at its meetings in order to lawfully take action on the items on its agenda. However, the advisory committee voted on items during all 13 meetings it held from fiscal year 2016–17 through December 2019 despite not having a necessary quorum of members present. For example, in June 2019, the committee held a meeting with only one committee member present. However, the meeting minutes reflect that the committee—consisting of that single attendee—voted to recommend that the board approve multiple proposed rules and rule amendments. The district board subsequently adopted these rules and amendments through its consent process. In another instance, in a September 2017 meeting, the advisory committee voted to approve a new rule related to asbestos. In addition to the fact that only two members attended the meeting, the advisory committee's minutes noted three votes in favor of recommending that the board approve the rule because it counted an email submitted by an absent member as an aye vote. However, voting by email violates the State's public meeting laws, as members must be physically present at the meeting or attend via teleconference. Nonetheless, the agenda for the district board's meeting described the proposed rule as "supported by the Air Pollution Control District Advisory Committee," and the district board proceeded to approve the item on consent.
The assistant director did not provide an explanation for why the advisory committee conducted operations in violation of state law, instead stating that the committee was doing the best that it could, and that the district staff typically described how many members of the advisory committee were in attendance when providing the committee's recommendations to the district board. Nevertheless, notifying the district board does not allow the advisory committee to deviate from complying with public meeting laws. When we described the advisory committee's lack of a quorum to a board member, he explained that the county counsel provides guidelines regarding public meeting requirements to members of the boards, commissions, and committees the district board oversees, and that the board assumes they are following the State's public meeting requirements. However, this level of oversight is obviously inadequate. Even a brief review of meeting minutes revealed that the advisory committee failed to comply with public meeting requirements. Had the San Diego Air District and the district board devoted more attention to addressing the vacant seats on the committee and ensuring that it was complying with the requirements of the State's public meeting laws, they could have better demonstrated a commitment to conducting the public's business openly and appropriately.
As we previously discuss, recent changes to state law will alter the composition of the district board to include representatives of the county, the region's cities, and the public—including one member of the public with expertise in public health, another with expertise in environmental justice, and a third with a scientific or technical background in air pollution. Thus, state law will restructure the district board to be more representative of the San Diego Air District's stakeholders, which should ensure some of the additional public perspective and expertise that the advisory board was intended to provide. However, because the future composition of the district board does not include representatives of the business community, the board may wish to retain the advisory committee. If it does so, it should not accept recommendations of the advisory committee unless the committee complies with the State's open meeting requirements and is composed of the stakeholders whose perspectives it is intended to represent.
To ensure that it is responsive to its stakeholders and encourages public participation in the creation of its regulatory and permitting policies, the San Diego Air District should create and implement a public participation plan by January 2021 that includes both public outreach and public engagement activities.
To ensure that its decisions are transparent and that it encourages opportunities for public involvement, the district board should publicly deliberate on key issues related to air quality during its regular meetings.
Because the new district board will include additional stakeholders who represent some of the interests that the advisory committee was intended to represent, the district board should determine whether the advisory committee is still necessary. If the district board determines that the advisory committee is still necessary, it should do the following:
- Immediately publicize the vacancies on the advisory committee on its website and in the monthly and annual county reports of vacancies on boards, commissions, and committees, and actively seek nominations to fill these positions.
- Ensure that the district's legal counsel monitors the advisory committee meetings beginning immediately, and advises the committee when it does not comply with state public meeting requirements.
The San Diego Air District Cannot Provide Accurate Complaint Information and Has Not Ensured That All Complaints Are Properly Addressed
- Because of missing and illogical information in its complaint database, the San Diego Air District does not have accurate information necessary to determine whether it is meeting new statutory requirements.
- The San Diego Air District has not consistently followed its policies for investigating public complaints. It did not investigate one of the 10 complaints we reviewed, an oversight that it could have avoided if it required supervisors to review investigation reports within a specific time frame after it receives complaints, and it was late in investigating another complaint.
The San Diego Air District Cannot Currently Provide the Public With Accurate Complaint Data
Complaint Information That the San Diego
Air District Must Publish on Its Website by December 2021
- All settled enforcement actions in a downloadable and searchable format.
- The face sheets of notices of violation or notices to comply 30 days after issuing these notices.
In addition, the San Diego Air District must evaluate its complaint process and provide a plan to publish on its website, the following:
- Date and time of each complaint.
- General nature of each complaint.
- Closest intersection to the site of each complaint.
Source: State law.
The San Diego Air District's database of public complaints about air quality contains numerous inconsistences and errors that compromise the reliability of that information. Consequently, the district is currently unable to present accurate information to the public regarding the complaints it has received. The district accepts complaints from the public about air pollution in the county—including smoke, dust, and odors—by phone, email, or the county's mobile application for reporting problems. However, the assistant director confirmed that the district posts complaints on its website for only one community in the county and does not publish complaints for the rest of the county. State law requires the San Diego Air District to evaluate its current public complaint process and provide a plan by December 2021 for updating that process—including responding to complaints within 48 hours or less. As part of that process, it must publish on its website the items that the text box lists.
The San Diego Air District tracks information about complaints electronically, yet we found that its database contained numerous errors and that district staff were unable to appropriately use the software that stores this information. Consequently, the data the district provided to us were incomplete and contained illogical information. District staff provided us on multiple occasions with what they asserted were all of the records in the complaint database. However, as a result of errors by district staff, the first dataset included records with duplicate record numbers and the second excluded certain records. Further, some information in the records was not logical. For example, some records contained data indicating that the district investigated complaints before the date the complaints were received.
The chief of the district's compliance division (compliance chief) explained that when the district receives repeated complaints about the same facility, staff enter in the database the date that an inspector conducted an investigation for the first complaint as the investigation date for all of the complaints. Consequently, the database would indicate for the latter complaints that an investigation occurred before the complaint had ever been made. However, if the district performs an investigation before it receives a related complaint, the conditions leading to that complaint may have reoccurred after the initial investigation took place. As a result of its approach, the district may not have assurance that the conditions causing each complaint have been sufficiently resolved. Further, the inaccurate dates preclude the district from accurately determining the amount of time it has taken to respond to each complaint it received—information that is necessary to determine whether it is meeting the new statutory requirements.
To address these data entry issues, the San Diego Air District is working with an information technology vendor (IT consultant) to assess its current complaint process. The IT consultant proposed recommendations in December 2019 that identified a number of areas for improvement and provided multiple recommended action steps. For example, the IT consultant suggested that the database should not allow a user to submit data if critical fields are missing information and that it should notify users when such data are missing. According to the San Diego Air District's information technology principal, the district expects to review an estimate of the cost and scope of work for upgrades to the database in July 2020 and anticipates completing that work by June 2021.
Among other recommendations, the IT consultant suggested that the district clean up the existing data within the complaint database to allow for accurate reporting. Along with striving to prevent future errors, it is important for the district to perform this clean-up so that it can evaluate its responsiveness to earlier complaints and their outcomes. Additionally, according to the U.S. Government Accountability Office, managers need information that is complete and accurate to make effective decisions and evaluate performance in achieving key objectives and addressing risks. Without such information, the San Diego Air District places itself at a disadvantage in administering its complaint process.
The San Diego Air District Lacks Policies and Procedures to Ensure That It Responds Promptly to Public Complaints
The San Diego Air District has not provided effective management oversight of its investigations of public complaints. When the public makes an air pollution complaint, the district's policy is to respond within 24 hours or by the next business day. Investigators must submit a report after completing their investigation. However, our review of a selection of complaints found that—in violation of its policy—the district did not perform investigations for all complaints. Further, it does not have a requirement that supervisors review the completed investigation reports within a required time frame, which might have helped it identify any violations of its policy.
As we discuss previously, the data the San Diego Air District provided to us were incomplete and inaccurate. Thus, when analyzing these data, we excluded 5 percent of the district's complaint records because they contained blank or inaccurate dates. The remaining records show that the district received an average of 780 complaints annually for fiscal years 2016–17 through 2018–19, and that it began investigating 90 percent of these complaints within one business day. According to these data, the district took an average of 42 business days from receipt of the complaint to complaint closure. In addition, 79 percent of all complaint responses were closed within 60 business days, and roughly 15 percent of complaints resulted in enforcement action.
Because of our concerns with the complaint data, we reviewed the investigation reports for a selection of 10 complaints to determine whether the San Diego Air District complied with its policies for investigating complaints. Our review found that the district failed to investigate one of the 10 complaints and did not investigate a second complaint within the time frame established in its policy. The compliance chief explained that the district's failure to perform the one investigation was due to an oversight but that it received a subsequent complaint about the same issue 48 days later, which it then investigated. Although the district eventually investigated the cause of this particular complaint, we are concerned that it would not have done so had it not received a subsequent complaint.
The problems we noted are likely in part the result of a lack of formal procedures to help ensure that the district investigates all complaints. For example, the district does not require supervisors to review complaints within a specific time frame after an investigator should have responded. The compliance chief explained that the San Diego Air District wants supervisors to prioritize the review of investigations that result in violations. However, without requirements for the supervisory review of all complaints within a specific time frame, the district risks continuing to overlook complaints.
The San Diego Air District has a feature in its complaint database that tracks the dates supervisors review complaint responses. The district could use this field to track those investigations that have not yet been submitted for supervisory review and follow up on them after a certain period to determine whether the investigations are occurring. When members of the public must submit complaints multiple times to prompt the district to take action, it may reduce their confidence in the district and could diminish their motivation to inform the district of issues in the future. Because complaints are a valuable source of information regarding potential noncompliance, it is important that the district demonstrate to the public that it prioritizes collecting, tracking, and addressing complaints promptly and accurately.
To ensure that it effectively manages its complaint investigation process and provides accurate information to the public regarding the complaints it receives, the San Diego Air District should do the following by June 2021:
- Establish policies and procedures that require staff to validate the information they enter in the district's complaint database. The district should also periodically review the accuracy and completeness of the data.
- Establish time frames for its supervisors to review complaint investigation reports and verify that investigators have responded to complaints in an appropriate and timely manner.
- Establish a process for validating the accuracy of the data it previously entered into its database.
Other Areas We Reviewed
To address the audit objectives approved by the Joint Legislative Audit Committee (Audit Committee), we also reviewed the San Diego Air District's negotiations to continue receiving administrative services from the county, the district's processes for applying for and administering grants, the extent to which district staff are devoting time to county-related activities, and the district's ability to engage with the public in the most commonly spoken languages in the county. A portion of this review resulted in a recommendation that we did not previously present in the report.
The San Diego Air District's Negotiations to Continue Receiving Administrative Services From the County
As the Introduction describes, a recent amendment to state law will restructure the district board beginning in March 2021. As a county department, the district currently receives services such as information technology, legal counsel, and human resources services from departments within the county. However, because the restructured district will not be governed by the county board of supervisors, it will no longer function as a county department and will thus have to secure those services by either soliciting outside vendors, hiring staff, or contracting for those services with the county. The San Diego Air District is pursuing the latter option by negotiating with the county to secure an agreement for the services it needs. According to the district's legal counsel, the contract will allow the district to continue operating until the new district board can decide whether to continue obtaining these services from the county or pursue other options. The county's legal counsel indicated that as of March 2020 the two parties were close to reaching an agreement—one year before the San Diego Air District stops functioning as a county department. However, at the county's request, presentation of a finalized agreement was withdrawn from the district board's agenda for its June 2020 meeting. If the county and the San Diego Air District are unable to come to an agreement before it seats its new board, the district will have to obtain these services from another entity or by hiring staff.
To ensure that it has a method of providing key administrative services in place by the time it ceases to function as part of the county, the San Diego Air District should finalize its agreement with the county to continue providing key administrative services as soon as possible.
The Process for Administering State and Federal Grants
The San Diego Air District received state grants and awarded incentive grants to eligible local projects over the last several years. As we describe previously, the district did not participate in the State's clean cars program when it was first allowed to apply for funds from this program for fiscal year 2016–17. In fact, CARB identified a total of 17 solicitations for state grants from fiscal year 2016–17 through February 2020 for which the San Diego Air District did not submit an application. The district's choice to not pursue 15 of these grants appears reasonable based on the characteristics of the grants. However, in addition to the clean cars program, the San Diego Air District could have applied for two other pilot programs that incentivized the adoption of clean vehicle technologies in lower-income households and in disadvantaged communities. The district's grants manager explained that these projects were very different administratively than the district's existing grant programs and that at the time the district felt that it did not have the resources or expertise to successfully administer these programs. However, it subsequently identified alternative funding to administer one of these programs and applied to do so at the prompting of a board member—actions it should have considered on its own.
According to the district's grants manager, the EPA and CARB notify the San Diego Air District when the district may be eligible for an upcoming grant. The district submitted applications to CARB after receiving these notifications for most of the grant opportunities for which it was reasonable for it to apply. As we stated previously, from fiscal years 2016–17 through 2018–19, the San Diego Air District collected a total of $22.8 million in grant funds, and it expects to collect another $30.4 million in fiscal year 2019–20—for a total of $53.2 million. These grants come from CARB and federal agencies, such as the EPA and Homeland Security.
We reviewed a selection of five grants totaling nearly $390,000 that the district awarded to local applicants for the purchase of cleaner‑than‑required engines and equipment and found that it generally complied with key requirements when awarding these grants. However, during the period we reviewed, the district did not ensure that grant recipients submitted all required status reports in a timely manner. Nevertheless, at the time of our review, the district had received the required reports for the most recent period for all but one of the grantees we selected. According to the district's grants manager, the district considers grantees to have satisfied the requirements of the contract if they have submitted their status report for the most recent period, and as of April 2020 all but one grantee among the five selected had satisfied the status reporting requirements. The grants manager also explained that the district recently hired an aide to monitor status reports, and she anticipates that this will reduce the number of missed status reports in the future.
Use of San Diego Air District Staff for County-Related Activities
The county has required San Diego Air District staff to participate in some county meetings and trainings. The district's finance director confirmed that the county has required some district staff, primarily divisional chiefs, to participate in some county functions such as county management and leadership activities, budget and finance meetings, and training events. However, after the district stops functioning as a county department, it will no longer be subject to county direction, it will have a separate budget process, and it plans to obtain an independent financial system. As a result, the assistant director confirmed that district staff will not be required to participate in county meetings regarding budget or finance activities. Further, district executive personnel will not be required to participate in various county-related leadership meetings. However, the assistant director also stated that current and future district employees will continue to be county employees. Thus, district staff may be required to participate in some county human resources meetings or employee training after the district ceases to function as a county department in March 2021.
The San Diego Air District's Ability to Engage With the Public in the Most Commonly Spoken Languages in the County
The San Diego Air District is able to meet the language needs of the vast majority of county residents. Based on 2016 census data, 95 percent of San Diego County residents speak either English or Spanish exclusively or, if they speak a primary language other than English or Spanish, they also have English fluency. According to its human resources officer, the San Diego Air District employs nine Spanish-speaking staff. The district's website also provides public complaint forms in Spanish and has some educational videos in Spanish that explain how to comply with certain district regulations. District staff stated that there has not been significant demand for permit services in languages other than English. However, in the event of such requests, the San Diego Air District has access to interpretation services from a vendor contracted by the county that enables it to accommodate the needs of residents who speak other languages. According to the district's finance director, the district intends to include language services in the agreement for services that it is currently negotiating with the county.
We conducted this performance audit under the authority vested in the California State Auditor by Government Code 8543 et seq. and in accordance with generally accepted government auditing standards. Those standards require that we plan and perform the audit to obtain sufficient, appropriate evidence to provide a reasonable basis for our findings and conclusions based on our audit objectives. We believe that the evidence obtained provides a reasonable basis for our findings and conclusions based on our audit objectives.
ELAINE M. HOWLE, CPA
California State Auditor
July 16, 2020