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Bullsh1t it might be a state law but not federal if that was true there's millions of illegal cars on the road[/quote]
It is not BS, it is reality. There are many cars breaking the law right now.
Here is the PDF explaining the engine swapping laws.
http://www2.epa.gov/sites/production/files/documents/engswitch_0.pdf
The intention is to make sure certified emission packages are kept in tact. The car has a emission standard that it must meet. If you can't prove it, you can't do it. Aftermarket kits- catalyts, turbos, superchargers, etc- have to meet the same rules. No foreign engines that are not somehow certified for use in the US and you are not allowed to bolt an engine from a different make into a car.. as then there is no way to have all the cerftified emissions controls in place. That standard also includes OBD (depending on the year) and evaporative emissions. If you swap an engine, the resulting vehicle has to meet the emissions covering the newer of the two, i.e. if you stick a 1995 engine into a 1980 car, the resulting vehicle now has to pass 1995 emissions standards. If you swap a 1980 engine into a 1980 car, it too must pass 1980 standards. Engine switches (swaps) are acceptable as long as the resulting vehicle matches exactly to any "certified" configuration of the same or newer make and model year as the chassis.These laws apply to anything newer than 1965. Federal law applies everywhere, even FL. Now, they may not test for emissions stuff down there, but the same laws do apply regardless.
Besides federal laws, states can put more restrictions on top of the fed laws, but they are powerless to repeal fed laws. Just because you are exempt from inspections doesn't mean you are exempt from obeying the law. States can only stop or cut down on inspections if the Feds feel the local air quality meets the federal standard and allow the state to do so. If the air quality doesn't meet standards or drops below that standard, then the Feds will order the state to resume inspections again until the air cleans up. Most states are OK with engine swaps, as long as you replace the engine with one of the vehicle's model year or newer AND leave all emission control devices intact. GM's E-Rod crate engine are certified packages, which makes them legal everywhere in the US for older cars. Or pull a complete certified package out of a same year or newer donor.
As for the rules- what do people honestly expect? OEM's are supposed to make cars that meet specific emission rules, and should not be tampered with, unless you can prove that they are compliant. And if you can prove it, then it's quite legal. So, I don't exactly understand people's beef with the rules.