Historically, parts of California have had the worst air quality in the nation. The California Energy Commission began experimenting with alternate fuels in the 1970's in an effort to reduce harmful automobile emissions and hence, improve air quality. It is recognized that the costs to California which result from our air quality problems are immense. Ten to twenty billion dollars each year is the estimated damage in terms of health impacts, materials damages, lost agricultural crop output and forest damages. As the California population increases and health care costs escalate, the total monetary damages from air pollution will increase. The California Energy Commission goal to improve air quality became a mandate in 1988 with the passage of the California Clean Air Act (CCAA). The CCAA requires a revised air quality strategy for the San Diego district since we do not meet State air quality standards for smog, carbon monoxide and nitrogen dioxide. Smog remains San Diego's major air quality problem, even though the annual number of days each year over the Federal standard has been reduced by 55 percent in the past ten years. Ten years ago about two-thirds of San Diego's smog was transported from Los Angeles. Today more than 60 per cent of the days San Diego exceeds the State standard are from locally generated smog. It is estimated that 57% of the reactive hydrocarbon emissions (which react with nitrogen dioxide in the presence of sunlight to form smog) is from cars, trucks and buses. The Air Pollution Control District (part of the County of San Diego) is the office that the Air Resources Board has put in charge of creating regulations and designing strategy to reduce polluting emissions. The purpose of this project is to determine the full cost of acquiring and operating a municipal fleet which meets the mandates of the California Clean Air Act. With that information, a plan to meet the Clear Air Act (CCAA) requirements can be formulated by local government.