A better diagnosis could be given if you posted the type of test and complete test results.

California has tagged the M103 engine family as "high emitter profile". The KE fuel system is a factor, but catalyst aging is likely the primary issue.

There are a couple of easy "tweaks" that can significantly reduce emissions that are discussed in the folloing threads:

http://www.peachparts.com/shopforum/tech-help/298724-300te-failed-az-emissions-nox-close.html

http://www.peachparts.com/shopforum/tech-help/123674-passed-smog-barely.html

Emission testing has been extensively discussed, and I've posted a lot of test data and analysis, so you should do some more archive searching.

Duke