The purpose of the Solution for the Environment and Economic Development (SEED) program is two-fold: 1) provide regulatory flexibility to industry, and 2) fund innovative technologies that achieve emission reductions beyond the commitments in state and federal air quality attainment plans. Under the program, businesses and other entities borrow emission reduction credits (ERCs) held by the Sac Metro Air District. Revenue obtained from loans fees is disbursed to innovative emission reduction projects that are recommended by the Air Pollution Control Officer and approved by the Board of Directors.
Rule 205 – Community Bank and Priority Reserve Bank governs the issuance of ERC loans and disbursement of revenue. ERC loans may be used to provide offsets under Rule 202 – New Source Review, to comply with specified prohibitory rules under Rule 107 – Alternative Compliance, to comply with a conformity determination under Rule 104 – General Conformity, to use as mitigation under the California Environmental Quality Act (CEQA) or a functionally equivalent program pursuant to Public Resources Code section 21080.5.
The Priority Reserve Bank consists of two accounts. The Essential Public Services Account provides ERC loans to sources considered to be essential public services, such as schools, hospitals, prisons and sewage treatment plants. The Military Base Account provides ERC loans for use or reuse of a military base.
The Community Bank provides loans of ERCs to public and private entities that are not essential public services and not for use or reuse of a military base.
Applicants for ERC loans from the Priority Reserve Bank or Community Bank must submit a loan application form. The application is then evaluated and prioritized.
Once prioritized, loans are considered for approval. Loans from the Community Bank with pollutant amounts that exceed 900 pounds per quarter of any pollutant or with terms longer than five years and all loans from the Military Base Account require approval by the Board of Directors. Other loans may be approved by the Air Pollution Control Officer.
Loan costs include three categories of fees:
If approved, loans from the Priority Reserve Bank and the Community Bank may be disbursed only after a final action document (usually an Authority to Construct or a Permit to Operate) has been issued and the applicant has paid the fees. Loans from the Military Base Account and the Community Bank are dispersed only on the first Wednesday of each calendar quarter.
Associate Air Quality Engineer