1993 945T California Spec Production Date 1/1993. 248K miles

My son's car

Recent full service including valves, timing belt, water pump, front engine seals.

DMV said for this biannual smog it needed to be done at a Test Only or "Gold Seal" facility (dyno run etc.)since it fell into the "High emitter Profile".

1st run - Passed Visual and Functional but failed emissions (allowed)
15mph HC 101 (59) CO 0.37 (0.34) NO 1429 (486)
25mph HC 77 (35) CO 0.25 (0,33) NO 692 (502)

This station which is also allowed to do repairs said that car needed new exhaust manifold which would take 2 weeks to obtain and cost $1000 P&L. If that didn't do it then they recommended new Cat and O2 sensor.

My son got a second opinion. They could not find exhaust manifold leak.
Catalytic converter was replaced and:

2nd run - Passed Visual and Functional but again failed emissions
15mph HC 6 (59) CO 0.2 (0.34) NO 738 (486)
25mph HC 3 (35) CO 0.01 (0.33) NO 424 (502)

As you can see still failed NO at both 15 and 25 mph but great improvement in other measurements.

OK what is next logical step? I looked at the exhaust manifold and do not see any obvious leak, all vacuum hoses seem intact and properly connected. O2 sensor might be original. Since it is relatively cheap could that be the failing component. I don't know if there are other things we are missing. Is there a logical progression to follow to avoid replacing everything under the hood?

Any suggestions are appreciated

Howard