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PROPOSAL:

Amend Rule 2202 AQIP Contract with Envirotest Systems Corporation

SYNOPSIS:

On July 14, 1996, the Board approved execution of a Rule 2202 - On-Road Motor Vehicle Mitigation Options AQIP contract with Santa Barbara Research Center (SBRC) for an amount not to exceed $578,956, to implement a remote sensing program. To date, SBRC has acted in good faith to fulfill its contractual responsibilities, but has been unable to achieve the expected results. AQMD and SBRC’s successor-in-interest for this contract, Envirotest, have jointly determined that this project should be discontinued. This action is to amend the contract with Envirotest to decrease the amount by $428,956, in order to cover only the cost of work performed and a final report, not to exceed $150,000.

COMMITTEE:

Mobile Source, December 11, 1997; fewer than three members were present and therefore, pursuant to the Procedures for Standing Committees of the Governing Board, the Committee provides this communication but no recommendation.

RECOMMENDED ACTION:

1. Authorize the Chairman to execute a contract amendment with Envirotest Systems Corporation (Contract No. 97049) to decrease funding in order to cover only the cost of work performed and an additional $10,000 for a final report, for a total not to exceed $150,000.

2. Direct staff to return the remaining contract amount to the Rule 2202 AQIP fund for the purpose of purchasing emission reductions not achieved through Contract No. 97049.

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

Background

On December 13, 1996, the Santa Barbara Research Center (SBRC) entered into a contractual agreement with the AQMD. SBRC is a business unit of Hughes Aircraft. The contract required SBRC to conduct remote sensing throughout the basin to reduce emissions by repairing high-emitting vehicles.

SBRC was conducting remote sensing at local college campuses and implementing the repair phase, when the AQMD was notified that SBRC’s remote sensing operation was sold to Envirotest Systems Corporation (Envirotest). Envirotest has completed a novation to finalize transfer of ownership of the SBRC contract, and the responsibilities for the remote sensing project have been transferred to Remote Sensing Technologies, Inc. (RSTI), a subsidiary of Envirotest. In addition the contract was extended for another six months to May 30, 1998.

Staff from both SBRC and RSTI have met with AQMD staff and the Acting Executive Officer on two occasions regarding completion of the contract. At the first meeting, the AQMD staff was informed of difficulties in obtaining vehicles to repair as required under the contract. Phase I of the contract had been completed by remote sensing 63,500 vehicles at five different colleges. At that time, SBRC agreed to rewrite the participation invitation letter, consider an increase of the financial incentives, and to conduct focus groups to determine the public attitude toward this program. It was hoped that these additional measures would induce a sufficient number of notified vehicle owners to come forward and have their vehicles repaired under this program.

In August of 1997, a subcontractor to SBRC held focus group meetings at UC Irvine and Santa Monica College. As a result of the focus groups, approximately 500 "second notice" letters and additional information flyers were sent out, with an additional 41 participants added to the program. While an improvement, the total of 101 vehicles repaired falls far short of the 600 vehicles specified in the AQIP contract. At this point a second meeting was held with the Acting Executive Officer and AQMD staff. At that meeting it was recognized that while the technical aspects of this program were successful, the repair of the vehicles fell short due to low public participation.

Envirotest has acted in good faith to fulfill its responsibilities under this contract, but has been unable to achieve voluntary public participation. RSTI and SBRC have agreed to prepare a final report to document the process and the lessons learned from the focus groups and project for a cost not to exceed $10,000.

The contract work performed includes the purchase of the emission reductions achieved which, in total with the final report, will not exceed $150,000. Enough unspent funds will remain to offset any emission reduction shortfall from the project. Staff will propose to the Board specific projects to make up the shortfall in the near future.

Recommendation

Staff recommends that the Board:

- Authorize the Chairman to execute a contract amendment with Envirotest to decrease funding in order to cover only the cost of work performed and a final report.

- Direct staff to return the remaining funds to the Rule 2202 AQIP fund for the purpose of purchasing emission reductions not achieved through this contract.

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