parking/ebrake will not engage

I have a 2002 tahoe, 4dr, 4wd, LT, autoride.
the ebrake will not engage (failed inspection). I looked at the adjuster under the drivers side by the frame and it appears to be at it tightest setting already. the dealer wants to replace the pads and charge a lot of $$. It has 32k miles on it. I can't imagine they would have worn out by now. Anyone else run into this? any suggestions?
thanks

Is that 4 wheel disc ? If it is your parking brake shoes are probably shot or way out of adjustment.

yes it is 4 wheel disc. are the ebrake shoes hard to replace? I am familiar with replacing the pads on my Jeep wrangler.

I just adjusted my Tahoe's parking brake, it was a simple matter of getting the pads into the right place, flicking the 'self adjuster' nob and getting the drum nice and tight (so that it's difficult to go back on) and then I bled the system and made sure the rears had a 'light' drag when rotating it by hand.

because I was new to drums the whole process took about 8 hours and I needed to borrow a friend for the bleeding :p

with 32k miles it will be covered under factory warranty due to service bulletin is out for new design retainer that keeps the shoes from moving and contacting the rotors causing premature failure.