BOARD MEETING DATE: October 11, 1996 AGENDA NO. 3
Proposal:
Execute an Air Quality Investment Program Contract with Ecology Auto Wrecking, Inc. for the Second Quarter of 1996 and Amend an Air Quality Investment Program Contract with Ecology Auto Wrecking, Inc. for the First Quarter of 1996.
Synopsis:
Rule 2202 - On-Road Motor Vehicle Mitigation Options was adopted on December 8, 1995. As one compliance strategy, the rule allows employers to invest in the AQIP. Monies received are placed in a restricted account to fund programs that result in emission reductions equivalent to that which would otherwise have been achieved by the participating employers. Staff evaluated the proposals received. This action is to recommend one proposal for funding and to amend one contract from the first quarter of 1996.
Committee:
Mobile Source, September 27, 1996, Recommended for Approval
Recommeded Action:
1. Authorize the Chairman to execute a contract for a total amount not to exceed $989,950 from the Air Quality Investment Program Special Revenue Fund to obtain mobile source emission reductions with Ecology Auto Wrecking, Inc.2. Authorize the Chairman to execute an amendment to the First Quarter 1996
Ecology Auto Wrecking contract to include an additional $199,357 to meet the adjusted emission reduction target for the first quarter of 1996.
James M. Lents, Ph.D.
Executive Officer
Background
The Rule 2202 Air Quality Investment Program (AQIP) allows all employers to participate by electing to invest in an AQMD-administered restricted fund. Investment can be either $60 annually per employee reporting to the worksite during the 6:00 a.m. to 10:00 a.m. peak window, or $125 per employee triennially. The restricted monies are to be used by the AQMD to fund proposals that achieve mobile source emission reductions that would otherwise have been achieved by implementing a rideshare program. This Board letter contains a discussion regarding the dispersal of funds from the AQIP compliance option for the second quarter of 1996.
Upon registering under this option and submitting the designated investment amount, an employer is considered to be in compliance with the rule and there is no need for the employer to take further action to reduce mobile source emissions. The collected monies are used to fund alternative mobile source emission reduction strategies that reduce mobile source emissions at a more cost-effective rate and could potentially result in greater overall emission reductions.
The 1996 second quarter submittal period ended on June 28, 1996. The total AQIP funds received during this period was $2,270,763 (see Attachment 1, Table 1). This amount includes both annual and triennial participants. The annual program contributions of $620,590 from 61 worksites will be used to purchase a single year of emission reductions; participation, by county, is noted in Attachment 1, Table 2. The triennial program contributions of $1,650,173 from 102 worksites will be used to purchase three years of emission reductions; participation, by county, is noted in Attachment 1, Table 3.
Policy Issues
State law which becomes effective January 1, 1997 [ Health & Safety Code Sections 40458 and 44243.5 added pursuant to SB 836 which was approved by the State Legislature August 31, 1996 and signed by the Governor on September 27, 1996] raises the worksite threshold of Rule 2202 from 100 to 250 employees per worksite. In fairness to those employers with less than 250 employees that have participated in the annual or triennial AQIP compliance options, staff is recommending that a prorated share of the AQIP contributions be refunded back to those employers. The refund would be calculated from the beginning of 1997 and would be prorated to correspond to the remaining funds that extend beyond January 1, 1997 for compliance. Staff will prepare an amendment to Rule 2202 to execute the AQIP fee refund recommendation.
The exemptions of those employers and the prorated refunding of their AQIP contribution, will significantly affect the level of AQIP funding available for the remainder of 1996. Specifically, the total amount of the refund, calculated as of the end of the second quarter is estimated at $1,419,806. This refund will reduce the AQIP funding available for the second quarter to $1,388,735. The AQIP funding balance from the inception of the program until the end of the second quarter of 1996 is provided in Table 1 of Attachment 2. Table 2 of Attachment 2 shows the adjusted emission reduction targets for the second quarter as a result of the exemptions pursuant to SB 836. The net emission reduction commitments as of the end of the second quarter of 1996 are shown in Table 3 of Attachment 2. As a result of emission reduction target adjustment for the current and past quarters, a deficit is shown for the 1996 balance of emission credits in the AQIP. To meet the emission reduction target of the first quarter 1996 and refund the prorated dollars to the first quarter participants, staff recommends that the first quarter Ecology Auto Wrecking contract be amended to include an additional $199,357.
Proposal Evaluation
During the second quarter of 1996, eight proposals were received requesting funds ranging from $240,075 to $1,388,465. The project proposals received were grouped into four categories: old-vehicle scrapping; alternative vehicle deployment; ridematching software/hardware; and remote sensing. Attachment 3 gives a summary of each proposal received, and funds requested. Attachment 4 lists the proposals received, funds requested, total proposal costs, and emission reductions expected for each proposal.
All proposals submitted are reviewed and scored based on the information in the proposal as submitted to the AQMD, and according to the selection criteria described in the RFP. The RFP scoring process consists of two steps. The first step is the technical evaluation, in which each proposal is assigned points based on: the potential of a proposed project to result in transportation technology and infrastructure improvements; the potential to achieve emissions reductions relative to the quarterly targets; and the overall expertise of the firm. In the second step the proposals are scored according to cost effectiveness, if the firm is a local business enterprise, and if it is a certified MBE/WBE/DVBE company or joint venture. Attachment 5 discusses the selection criteria and summarizes the overall ratings of each proposal.
The following proposal is recommended for approval:
Ecology Auto Wrecking - $989,950
This project will generate MSERCs through an old-vehicle scrapping program through the purchase of triennial credits. The MSERCs generated will meet the adjusted emission reduction targets established by the level of employer participation in the AQIP.
For the second quarter of 1996, the total recommended funding amount is $989,950 (see Attachment 6). Any remaining AQIP funds would be held for future proposal funding in subsequent quarters. Both annual and triennial AQIP emission reduction targets for each performance target zone and for all participants during the second quarter 1996 will be met by the recommended proposals and the excess emission credits from previous quarters’ projects made available due to SB 836.
Outreach
The AQIP announcement was mailed to all Rule 2202 employers (approximately 4,500 worksites). Furthermore, the availability of AQIP funds and the RFP was advertised in the Los Angeles Times, Orange County Register, Riverside Press Enterprise, Los Angeles Sentinel, Eastern Group Publications, San Bernardino Sun, La Voz, La Opinion, Rafu Shimpo, Precinct Reporter, The Black Voice News, Chinese Daily News, Korea Central Daily, El Chicano, The Excelsior, Philippine News, "h/mt Project Information Services," The M/W/DVBE Source, and the California State Contracts Register. Copies of the AQIP announcement and the RFP were sent to the Black and Latino Legislative Caucuses and interested minority contractors/professional associations, transportation management associations and organizations, members of the Consultants Roundtable, attendees at AQIP bidders conferences, and any interested party. In addition, a Bidders Conference was held at AQMD headquarters on June 11, 1996.
Resource Impact
The prorated refund of AQIP monies to participating employers at worksites with 100 to 250 employees amounts to $1,419,806, which leaves $1,388,735 for second quarter funding (see Table 1 of Attachment 2).