PROPOSAL:

Execute Contracts for AQIP Proposals Received During First Quarter of 1998

SYNOPSIS:

Rule 2202 - On-Road Motor Vehicle Mitigation Options was adopted on December 8, 1995. One of the compliance strategies under Rule 2202 allows employers to invest in the AQIP. Monies received are placed in a restricted account to fund programs that result in equivalent emission reductions that would otherwise have been achieved by the participating employers. Staff evaluated the proposals received during the first quarter of 1998 and this action is to recommend two for funding. The amount available for this quarter is $888,667.

COMMITTEE:

Mobile Source, July 17, 1998, Recommended for Approval

RECOMMENDED ACTION:

Authorize the Chairman to execute two respective contracts for a total amount not to exceed $495,000 from the AQIP Special Revenue Fund to obtain mobile source emission reductions with Pick Your Part Auto Wrecking for an amount not to exceed $165,000; and OceanAir Environmental for an amount not to exceed $330,000.

Barry R. Wallerstein, D.Env.
Acting Executive Officer

Background

The Rule 2202 AQIP allows subject 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 triennially per employee. 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 disbursal of funds from the AQIP compliance option for the first quarter of 1998.

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 which could potentially result in greater overall emission reductions.

The first quarter of 1998 submittal period ended on March 31, 1998 with 26 employers participating in the AQIP program. The total AQIP funds received during this period were $166,836, which includes both annual and triennial participants (see Attachment 1). In addition, $721,831 is being carried forward from the previous quarters. Therefore, the total amount available for this quarter is $888,667. Staff recommends that $165,000 be used to purchase emission reductions to satisfy the one-year and the three-year requirements. Staff also recommends that $330,000 be used to purchase emission reductions to help meet the shortfall due to the exemption of employers with 100-249 employees during 1997, per SB 836. The total amount recommended for funding is $495,000.

Proposal Evaluation

During the first quarter of 1998, seven proposals were received requesting funds ranging from $40,720 to $600,000. The project proposals received can be grouped in four categories: old-vehicle scrapping, alternate fuel vehicles, transportation demand management, and other. Attachment 2 gives a summary of emission reduction targets and the emission reduction credit balance. Attachment 3 gives a summary of each proposal received and funds requested. Attachment 4 provides an overall summary of the proposals by type, listing the proposals received, funds requested, total proposal costs, and emission reductions expected from each proposal.

All proposals submitted were 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 evaluation panel consisted of six AQMD employees: four from Transportation Programs; one from Planning; and one from Technology Advancement. The panel consisted of three females and three males; one Asian Pacific Islander, three Caucasian, and two Hispanic. Attachment 5 discusses the selection criteria, the scoring process, and the overall ratings for each proposal.

Attachment 5 provides a summary of the proposal rankings. While cost-effectiveness is the most heavily weighted criteria for determining ranking, the amount of funding available ultimately determines the recommendation. For the 1^st quarter $166,836 was received. Pick Your Part Auto Wrecking's option 1 was the most cost-effective in regard to available funds and meeting the necessary emission reductions. The OceanAir proposal was selected to assist both in meeting the 1997 emission shortfall due to SB 836 and to build up the emissions bank toward meeting anticipated future shortfalls.

The following proposals are recommended for approval:

Pick Your Part Auto Wrecking proposes to generate MSERCs by eliminating pre-1982 vehicles through old-vehicle scrapping. Option 1 has a cost-effectiveness of $1.35 per pound.

OceanAir Environmental proposes to generate Emission Reduction Credits by repowering a pusher tugboat based in the Port of Long Beach with a low-emissions diesel engine. Option 8 has a cost-effectiveness of $2.19 per pound.

Outreach

In accordance with the AQMD’s consulting and contracting policies, a public notice advertising the RFP and inviting bids was published in the following publications:

Additionally, potential bidders were identified through Los Angeles County MTA and Caltrans Directories of Certified Minority, Women, Disadvantaged and Disabled Veterans Business Enterprises; the Inland Area Opportunity Pages Ethnic/Women Business & Professional Directory; the AQMD’s own electronic listing of certified minority vendors; and AQMD Purchasing’s mailing list. Copies of the RFP were mailed to the Black and Latino Legislative Caucuses and various minority chambers of commerce and business associations; and were placed on the Internet at AQMD’s Web site [http://www.aqmd.gov, "Business and Job Opportunities" icon] and on AQMD’s 24-hour telephone message line for bidders (909) 396-2724.

A Bidders Conference was convened at the AQMD on March 3, 1998 to highlight the requirements of the proposals and to answer questions from the nine prospective bidders in attendance.

Resource Impact
Not applicable.

Attachments
1. AQIP Funding and Participation
2. Summary of Emission Reduction Targets and Credit Balances
3. Summary of AQIP Proposals Received
4. Summary of Proposals By Type
5. Summary of Proposal Ratings
6. Recommendation for Funding

ATTACHMENT 1

AQIP - First Quarter 1998

TABLE 1

Funds Received (as of March 31, 1998)

TABLE 2

Annual Participation

TABLE 3

Triennial Participation

ATTACHMENT 2

AQIP - First Quarter 1998

TABLE 1

Emission Reduction Targets
(Pounds)

TABLE 2

Emission Reduction Credit Balances
(Pounds)

* Note: Emission Credits from year 1997 have been carried forward to
year 1998 (see below).
** Includes carry-forward; i.e., 1998 "New Balance" total includes
1998’s (a-b+c-d) plus 1997’s (a).

ATTACHMENT 3

Summary

Air Quality Investment Program

Proposals Received - First Quarter 1998

The following proposals were received in response to the AQIP Request for Proposals (RFP) on or before March 31, 1998. The proposals are not listed by classification or rank.

Ecology Auto Wrecking proposes to generate MSERCs through an old-vehicle scrapping program and provide triennial credits. Based on the information provided, the proposal is estimated to have a cost-effectiveness range of $1.32 to $1.34 per pound. (Not funded.)

Pick Your Part Auto Wrecking proposes to generate MSERCs by eliminating pre-1982 vehicles through old-vehicle scrapping. The ten options have a cost-effectiveness range of $1.31 to $1.35. (Funded Option 1, as it meets the Emission Reduction Target.)

Market-Based Solutions proposes to generate MSERCs through an old-vehicle scrapping program. This proposal offers two options with cost-effectiveness values of $1.89 and $2.92 per pound respectively. (Not funded.)

This project proposes to reduce emissions by deploying three natural gas vans in the Torrance, Long Beach and general South Bay area. (Not funded: Did not meet the technical criteria.)

The Los Angeles Department of Water and Power (DWP) proposes to reduce emissions by deploying ten electric vehicles for use by DWP employees in their commute to work. (Not funded: This project was funded in July 1998 and withdrawn from consideration for this quarter, per the request of proposer.)

OceanAir Environmental proposes to generate Emission Reduction Credits by repowering a pusher tug boat based in the Port of Long Beach with a low-emissions diesel engine. The nine options have a cost-effectiveness ranging between $2.09 and $2.49. (Funded Option 8, which covers the NOx shortfall resulting from the exempt employers per SB836.)

Powerlight Corporation proposes to generate Emission Reduction Credits by converting diesel airport ground support equipment to solar powered electric tractors at the Los Angeles International Airport at a cost-effectiveness of $6.04 per pound. (Not funded: Did not meet the technical criteria).

ATTACHMENT 4

AQIP - First Quarter 1998

Proposal Summary (By Type)

TRANSPORTATION DEMAND MANAGEMENT	AQIP Funding Request	Total Program Cost	AQIP Program Period		Emission Reduction Commitments (lbs.)
				VOC		NOx	CO
LAB2ATRA, the City of Torrance, The Boeing Co.	$101,000	$147,500	Triennial	4,172		3,190	32,390

ATTACHMENT 4 (Continued)

OTHER	AQIP Funding Request	Total Program Cost	AQIP Program Period		Emission Reduction Commitments (lbs.)
				VOC		NOx	CO
OceanAir Environmental Option 1	$62,500	$628,540	Annual	54		25,000	86
Option 2	$120,000	$628,540	Annual	107		50,000	172
Option 3	$171,672	$628,540	Annual	160		74,640	257
Option 4	$120,000	$628,540	Biennial	108		50,000	172
Option 5	$230,000	$628,540	Biennial	214		100,000	344
Option 6	$328,416	$628,540	Biennial	320		149,280	514
Option 7	$172,500	$628,540	Triennial	162		75,000	258
Option 8	$330,000	$628,540	Triennial	321		150,000	516
Option 9	$470,232	$628,540	Triennial	480		223,920	771
Powerlight Corporation	$348,490	$668,490	Triennial	6,866		29,698	147,955

ATTACHMENT 5

Summary
AQIP - First Quarter 1998
Proposal Ratings

All proposals submitted were reviewed and scored according to the selection criteria in the Board-approved RFP. The evaluation process consists of two steps: Step 1 - Technical, and Step 2 - Cost and Other Factors. Proposals scoring a minimum of 70 points for technical criteria are then scored for cost and other factors. Proposals that score below 70 points are not scored any further and would be scored zero for the total score. The resulting total and average scores are summarized in the table below.

ATTACHMENT 5

Summary
AQIP - First Quarter 1998
Proposal Ratings
(Continued)

* Aggregated total score from all six members of the proposal evaluation panel.

ATTACHMENT 6

AQIP -First Quarter 1998

TABLE 1

Proposals Recommended for Funding
Anticipated Emission Reductions
(Pounds/Year)

TABLE 2

Proposals Recommended for Funding
Funding Request

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