Current through Register 2024 Notice Reg. No. 38, September 20, 2024
(a) A Locomotive Operator whose gross revenue
has not exceeded a gross revenue cap of five million dollars annually, adjusted
for inflation, in each year for the last three years may submit an application
to the Executive Officer requesting a Small Business Hardship Extension.
(1) An inflation adjustment shall be made
annually using the following methodology: Inflation Adjusted Gross Revenue Cap
= $5,000,000 * (U.S. Consumer Price Index [reference year]/U.S. Consumer Price
Index [2019]).
(2) Gross revenue
cap shall be adjusted annually using Bureau of Labor Statistics' Consumer Price
Index for All Urban Consumers.
(b) Locomotive Operators must submit the
application no later than March 1 of the year following the Calendar Year for
which the extension is sought for Spending Account Requirements and no later
than 90 calendar days prior to the start date of the extension for extensions
sought for the In-Use Operational Requirements.
(c) Approval of a Small Business Hardship
Extension may grant the applicant any of the following (including any
combination), as specified in the Executive Order approving the Small Business
Hardship Extension:
(1) A reduction in the
amount of funds, up to the total requirement, required to be set aside in the
Spending Account for up to three years.
(2) Up to a three-year extension of the time
the Locomotive Operator is allowed to continue Operation of a Locomotive(s) in
California that does not comply with the In-Use Operational Requirements in
section 2478.5.
(d)
Small Business Hardship Extension
Application. Locomotive Operators that meet the requirements of
subsection (a) may apply for a Small Business Hardship Extension by submitting
an application as required in section
2478.15 that includes the
following:
(1) Financial documentation
demonstrating gross revenue for the three Calendar Years preceding the
submission of the application per subsection (a).
(2) An identification of the type of relief
that the Locomotive Operator requests per subsection (c) and the following
information:
(A) If the Locomotive Operator
seeks the relief set forth in subsection (c)(1):
1. The amount of reduction requested for up
to three years.
2. The timeframe
over which the applicant would like that reduction to apply (up to three
years).
3. An explanation of why
the reduction is needed throughout that timeframe.
4. Evidence demonstrating that setting aside
funds into the Spending Account as required by section
2478.4 will prevent the Locomotive
Operator from meeting financial obligations that will cause bankruptcy or the
closure of their business.
(B) If the Locomotive Operator seeks the
relief set forth in subsection (c)(2):
1. The
amount of time requested for the extension for up to three years.
2. An explanation of why that time is
needed.
3. Evidence demonstrating
that the application of the applicable requirements from the In-Use Operational
Requirements will prevent the Locomotive Operator from meeting financial
obligations that will cause bankruptcy or the closure of their
business.
4. Identifying
information about any Locomotives that would Operate under the extension if
approved, including:
a. Locomotive road
number.
b. Locomotive serial
number.
c. Engine
Tier.
(C) A
minimum of three years of the Locomotive Operator's tax data including one of
the following:
1. Sole proprietorship or
one-member LLCs/partnership's file Internal Revenue Service (IRS) Form 1040
("U.S. Individual Income Tax Return") and Schedule C.
2. S-corporations file IRS Form 1120S ("U.S.
Income Tax Return for an S Corporation") and Schedule K-1.
3. C-corporations file IRS Form 1120 ("U.S.
Corporation Income Tax Return").
4.
Multi-member LLCs file IRS Form 8832 ("Entity Classification Election") and can
elect to be treated as either an S- or C-corporation.
5. Multi-member partnerships file IRS Form
1065 ("U.S. Return of Partnership Income") and Schedule K-1.
6. Governmental entities shall supply annual
financial reports, bond prospectuses, and budgets.
7. Not-for-profit entities shall provide IRS
Form 990 if gross receipts are more than $200,000 or assets greater than
$500,000 and annual financial reports.
(D) Any other evidence necessary to
demonstrate hardship, including, where applicable:
1. Financial statements prepared by an
outside accounting firm.
2. Budgets
and year-to-date results.
3. Asset
ledgers.
4. Real estate and
property tax records.
(e) CARB will determine whether the financial
hardship of the Locomotive Operator justifies an approval of an application for
a Small Business Hardship Extension by analyzing the information provided using
one of the following:
(1) ABEL will be used
for S- or C-corporations or multi-member LLC/partnerships;
(2) INDIPAY will be used for individuals,
sole proprietorships or one-member LLC/partnerships;
(3) MUNIPAY will be used for government
agencies; or
(4) Any other means
necessary to determine the financial hardship.
(f)
Notice of Approval.
Within 90 calendar days after the Executive Officer has received a complete
application for a Small Business Hardship Extension, the Executive Officer
shall issue a notice of approval if the application meets the requirements of
this section.
(1) An Executive Order
approving an application will specify the type(s) of relief granted and the
parameters of that relief, including the date when the extension begins to be
applicable and the duration of the extension. In the event of an approval, the
Locomotive Operator is only granted relief from the specific provisions
identified in the Executive Order approving the extension according to the
terms set forth therein.
(A) If the Executive
Order approves a reduction in the Spending Account Funding Requirement per
subsection (c)(1), the Executive Order will specify the amount of any reduction
granted.
(B) If the Executive Order
provides relief to the In-Use Operational Requirements in section
2478.5 per subsection (c)(2), the
Executive Order will specify the timeframe, up to three years, the
Locomotive(s) may continue to Operate in California without
penalty.
(2) Approval is
contingent upon the submission of a complete, accurate, and timely application
following the requirements of section
2478.15. The Executive Officer may
disapprove of an application if the Locomotive Operator is out of compliance
with the Locomotive Regulation.
(g)
Notice of Disapproval.
Within 90 business days after the Executive Officer has received an application
for a Small Business Hardship Extension, the Executive Officer shall issue a
notice of disapproval if the application is incomplete or does not meet the
requirements of this section. The Executive Officer shall summarize the
application deficiencies in the notice of disapproval.
(h)
Expiration and
Revocation. A Small Business Hardship Extension that has expired or
has been revoked shall not be used for compliance with this Locomotive
Regulation.
(1) An approved Small Business
Hardship Extension is only valid for the time period specified in the Executive
Order approving the extension and shall expire after the time period specified
in the Executive Order.
(2) An
approved Small Business Hardship Extension may be revoked at any time by the
Executive Officer for any of the following reasons:
(A) The Locomotive Operator's annual gross
revenue during the duration of the Small Business Hardship Extension exceeds
the Inflation Adjusted Gross Revenue Cap calculated as described in subsection
2478.14(a)(1).
(B) The Locomotive Operator fails to meet any
of the requirements set forth in the Executive Order granting the Small
Business Hardship Extension.
(C)
The Locomotive Operator fails to meet any other applicable requirements of this
Locomotive Regulation, including Idling, Registration, and annual Reporting
Requirements.
(3) CARB
will provide notice of revocation, including the date of the official
revocation, to the applicant in writing at least 30 business days prior to the
official revocation.
Note: Authority cited: Sections 38560, 39600, 39601,
39658, 39659, 39666, 41511, 43013 and 43018, Health and Safety Code. Reference:
Sections 39650, 39659, 41511, 43013 and 43018, Health and Safety Code.
