Complaints by Industry Spur AQMD Shift : Pollution: Smog board’s changes will include a streamlined permit process for businesses. Environmental activists fear the consequences.

Prompted by complaints that clean-air rules are driving industries away or out of business, the South Coast Air Quality Management District on Wednesday announced a series of reforms of its complex bureaucratic processes.

“We’re not going to take the rap for a depression,” said AQMD board member Larry L. Berg in a telephone interview.

The changes were greeted with delight, and some skepticism, by business representatives. “That is a magnificent step forward,” said Wilford D. Godbold, chairman of a California Chamber of Commerce task force on keeping jobs in-state. “Whether they can carry it off . . . I want to see it happen.”

Environmental activists said that although business has legitimate gripes, they fear the initiatives portend a less-aggressive air agency in the nation’s smoggiest region. “(AQMD officials are) really on the defensive; they’re running scared,” said Veronica Kun, staff scientist for the Natural Resources Defense Council.

It is not known how many companies have left the region because of air quality regulations, but AQMD Executive Officer James M. Lents said the agency is tired of being blamed.

At a news conference at the agency’s Diamond Bar headquarters, Lents vowed to dramatically cut permit processing time and to allow some company self-policing. He said the district’s focus will shift from regulation of individual businesses to controlling the kinds of supplies that can be sold to industry in Los Angeles, Orange, Riverside and San Bernardino counties.

Lents promised a one-week turnaround on permit applications from small businesses, such as new auto body shops--although permits for operations that use cancer-causing chemicals may take longer. He said a moderate-sized polluter, such as an asphalt-manufacturing plant, would wait no more than 30 days. Those two categories account for two-thirds of AQMD’s operating permits.

Major polluters such as refineries will receive longer scrutiny, Lents said, but their permits also should be issued more quickly than in the past.

Such quick action would be a far cry from the widespread stories of waits ranging from two months to two years. For example, said Godbold, an aerospace company wanted to build a facility in the South Bay area, but changed plans after waiting 28 months for an air district permit. Within 16 months, he said, the firm not only received a permit but also finished construction in Salt Lake City.

Godbold’s own company, which manufactures cases and cabinets for electronics, may move one of its plants from North Hollywood to Pacoima. “But if the AQMD permits take too long, our alternative is to move out of state,” he said.

On a smaller scale, a general contractor in Colton filed an application Aug. 28 to replace an underground fuel tank at a San Bernardino country club with an above-ground tank--a small job the firm’s owner considered a “slam-dunk permit” that would take a week or two.

After dozens of phone calls, the permit came through Wednesday, more than two months later. “It messes up our schedule. It’s disruptive,” said the contractor, George Spencer. The check for the $260 application fee, he noted, “got cashed right away.”

Tales like these have been carried to Sacramento, where they grabbed state legislators’ attention. The lawmakers’ reaction was to complain to the AQMD and to start planning legislation to make changes.

Fear that the agency could be stripped of some authority was a major impetus behind the new program, Lents acknowledged. “We paid attention,” he said.

Assemblyman Richard Polanco (D-Los Angeles), for example, plans hearings in December on the economic impact of air quality districts statewide. “We created them, we can dissolve them, we can modify them,” he said.

State Sen. Robert B. Presley (D-Riverside), a champion of the AQMD, said he, too, has been considering legislation because of business complaints. “We have to re-examine what we’ve been doing because of the recession,” he said.

Presley said he believes the AQMD has lost public support because of a perception that the agency is too heavy-handed. “I think we can change that without slowing down efforts to clean up the air by being careful, surgical about it,” he said.

The problems began in the last few years, Lents said, as the AQMD extended its reach from large companies to smaller polluters in an effort to wring every pound of smog-forming compound out of the skies.

For one thing, the agency did not take into account that big business can hire staff attorneys and coordinators to deal full time with regulatory demands, while small businesses cannot. Inspectors were supposed to be hard-nosed. “Our model was the Los Angeles Police Department,” he said, adding later, “Our inspectors were trained as motorcycle cops--you go out and you zap them.”

For another, said board Vice Chairman Henry Wedaa, “we didn’t really realize how big it was out there, how many permits we would have to handle as a result of the regulations we passed.” The annual number of applications jumped from 10,000 to 22,000 in one year, according to Lents.

For months, the AQMD has been studying a program to allow polluters to buy and sell emissions permits, replacing many of the agency’s regulations and granting more flexibility. The agency’s board is scheduled to decide in February whether to proceed with such a “smog exchange.” This is a major initiative pushed by industry.

The shift toward regulating suppliers has been advocated by board members Berg, Wedaa and Chairman A. Norton Younglove. They say that it would ease onerous paperwork for companies that must now keep records of how much polluting material they use.

The switch would transfer that burden to manufacturers of, say, paints or coatings, who would be given limits on the amount of pollutant they could sell to local companies. The AQMD would inspect the suppliers’ sales records, Lents said.

Godbold, of the California Chamber of Commerce, had qualms about this proposal. “What it may do is drive prices up dramatically,” he said.

Other key points in the reform package, dubbed “New Directions,” include:

* Expansion of a pilot program that trained company employees as inspectors and allowed businesses to perform their own frequent surveys, which AQMD inspectors audited. In 1990, 11 firms participated in a test and increased their compliance rates from 67% to 96%, said Edward Camarena, who heads the agency’s operations office.

* Earmarking of the $4 million to $5 million that the AQMD collects annually in penalties for a community service fund to finance such projects as small business loans for pollution control equipment or conversion of vehicles to cleaner fuels.

* Streamlining of the appeals process to “make it easier to get a variance,” Lents said.

* “Customer service” training for staff, including the mailing of postcards to businesses after an inspection asking for an evaluation.

That attitude was welcomed by business but it dismayed Tim Little, executive director of the Coalition for Clean Air. The customers, he said, should not be the polluters getting permits. “The customers are the people who have to breathe the air,” he said.