International Experience and Best Practices - Clean Air Initiative

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• How can government ensure a high level of compliance with I/M standards?
• How can government ensure that following key resources are in sufficient supply?
– Financial resources—for typically a multi-million dollar undertaking
– Institutional capacity—especially in the vehicle service sector
– Political support—critical for the I/M program to survive
ES-2. Eight Essential Best Practices
Four of eight essential best practices concern “institutional design” questions. The other
four relate to the categories of: test procedures and emission standards; enforcement
and compliance promotion; and managing resources.
Institutional Design
An I/M program should conduct inspections using “test-only” facilities.
Policymakers must choose between a relatively small number of centralized or “test-only”
facilities, and a relatively large number of decentralized or “test-and-repair” facilities.
Advantages of the former approach include the ability to spread costs over a high volume
of inspections, and achieve a low cost per inspection. Additionally, test-only facilities can
afford more costly, sophisticated test equipment by the ability to spread costs. Oversight
of the facilities by government is also relatively easy due to their small number.
Government should set the policy framework and provide overall management of
the I/M program while private contractors perform the actual inspections. This
conclusion likely will disturb those who believe every public service should be performed
by a government employee. However, expert opinion is unified on the desirability of
private firms performing this role under the oversight of a governmental body. In general,
this conclusion is driven by the same reasoning that underlies the broader privatization
movement affecting energy, water, transportation, and other sectors: many services of a
public nature are best delivered by a private firm accountable to the government rather
than by a state-owned entity that essentially holds a perpetual monopoly in providing the
service. The latter organizational form often suffers from low technical competence and a
general inability to punish poor performance or fraud at the individual employee level and
the organizational level as a whole. A capital-starved public monopoly can be subject to
budgetary pressures from external forces that threaten service quality and its ability to
generate revenue, even if it is otherwise capable of providing that service in a financially
viable manner.
Policymakers should exert strong oversight and institute a quality assurance
(QA) program for the I/M program. There is no escaping the need to “inspect the
inspectors.” Effective oversight and QA is essential to deliver the actual emission
reductions sought and help maintain public support for the program. Oversight and
QA involve a set of highly technical tasks that can be performed by government (if the
capacity exists) or contracting out in part.
Policymakers should implement I/M programs in a phased approach that allows
learning, adaptation, and capacity building along the way. Ideally, I/M programs
should begin with the vehicles that emit the most (due to their emission rates, high
mileage, or both). A phase-in of stringency of emission standards should also be