Agency problems with smog checking

| Comments (2) | Misc
California law require vehicles to be smog tested in order to be registered in the state of California. The smog testing is done by independent (but licensed) operators. This creates two major principal/agent problems:
  • The tester can falsely report a passing grade in return for a bribe—or just cause you're a good customer.
  • The tester can falsely return a failing grade in order to get you to spend money on "fixing" whatever they say is wrong with your car.

There are a number of countermeasures used against these problems. The first is to have "check only" stations, which will test your car but not fix it. The state requires some vehicles to be tested at check only stations, both by random assignment and by preferentially selecting vehicles they expect to be high emitters. The idea here seems to be that check only stations have no incentive to give a false failing grade because they can't profit from it. Similarly, because they don't have a relationship with you—unlike your regular mechanic—it's harder for you to bribe them since they're less likely to trust you're not entrapping them (see below).

This program seems like it's likely to be of limited effectiveness. First, only a small fraction of vehicles are assigned to check only stations and so you're only decreasing the amount of fraud by that fraction. It doesn't serve as a deterrent to fraud in itself. Second, at least for the second kind of fraud, the check only station could at least potentially get a kickback from your mechanic, though it might be hard for them to get together.

Another countermeasure is that the smog testing machines transmit their results to the state directly before (at least according to my mechanic) they're displayed to the mechanic. This is actually pretty clever, since it reduces the opportunities for a fraudulent mechanic to see the result and offer to fix the results for you. Obviously, you can still bribe the mechanic in advance, but that requires you to know in advance what's wrong. I tend to think it's less useful for the second kind of fraud, since it's surely pretty easy to gimmick the sensors to produce a positive reading. I should also mention that the connection between the machine and the state appears to be via modem, and, unless cryptography is being used, is probably pretty easy to spoof, which would let you bypass the initial negative test.

Another countermeasure against the first kind of fraud is that only test only and "gold shield" test stations can certify a vehicle once it has failed its smog check. It's obvious why this makes sense for test only and I assume that gold shield are subject to extra scrutiny by the state.

Finally, I assume that the State periodically sends people out with pre-calibrated vehicles to see if the testing stations are producing accurate results, if they offer to falsify the results for you, etc.

By the way, my car passed, though I needed a new gas cap.

2 Comments

I've known a few smog techs, and only one would falsify a test. The penalties are hefty. One of the others was in fact busted by a car sent out by C.A.R.B. He did not falsify the test, but missed a minor inspection item (tailpipe emissions were fine), and was fined $25,000 and lost his smog license for a year. He is *very* careful now.

Then, of course, there's the problem of smog checks in principle: Why is it that the technician must even bother to check the operation of things that affect tailpipe emissions (note that I am excluding things like evaporative emissions controls)? If the real issue was emissions, then that should be all they concern themselves with. But if you modify something in your engine bay that is covered by their inspection, even if it reduces emissions, your car will fail the check. Ever wonder who benefits from that type of policy? It's not us, and it's not the atmosphere.

In Ontario we have a similar emissions testing program called DriveClean. There is a public list of all the suspended and terminated DriveClean facilities:
http://www.driveclean.com/who/dcf_problems.html

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