BOARD MEETING DATE: February 1, 2002
AGENDA NO. 5

Adopt Resolutions to Receive Funds from California Energy Commission-Alternative Fuels Infrastructure Program to Purchase Equipment for Two Natural Gas Fueling Stations

SYNOPSIS:

The California Energy Commission (CEC) has approved Alternative Fuels Infrastructure Program grant funding of $500,000 for two proposed fueling stations: Omnitrans Montclair L/CNG station; and the Omnitrans San Bernardino L/CNG station. These projects will replace aging, obsolete fueling equipment that is currently not cost-effective to maintain and operate with state-of-the-art equipment. Staff recommends Board adoption of a resolution authorizing the Executive Officer to receive and administer CEC funding for each of the two projects.

COMMITTEE:

Technology, September 28, 2001, Recommended for Approval

RECOMMENDED ACTION:

1. Endorse the Resolution authorizing the Executive Officer to apply for funds and to execute for the benefit of Omnitrans an agreement with the California Energy Commission and all other necessary documents to receive and administer CEC funds for construction of the Omnitrans Montclair L/CNG fueling station, in an amount not to exceed $250,000.
   
   
2. Endorse the Resolution authorizing the Executive Officer to apply for funds and to execute for the benefit of Omnitrans an agreement with the California Energy Commission and all other necessary documents to receive and administer CEC funds for construction of the Omnitrans San Bernardino L/CNG fueling station, in an amount not to exceed $250,000.
   
   
3. Recognize $500,000 in support funding for the two Omnitrans projects from the California Energy Commission in the General Fund.
   
   
4. Appropriate $500,000 from the Undesignated Fund Balance to the Services and Supplies Major Object, Professional and Special Services Account in Science and Technology Advancement.
   
   
5. Authorize the Chairman to execute a contract with Omnitrans to purchase equipment for two Liquefied/Compressed Natural Gas (L/CNG) fueling stations in an amount not to exceed $500,000 ($250,000 for San Bernardino site and $250,000 for Montclair site) from the budget of Science and Technology Advancement.

Barry R. Wallerstein, D.Env.
Executive Officer

Background

In March 2001, the AQMD submitted funding requests for three natural gas fueling stations to the California Energy Commission (CEC). This was done in response to a Program Opportunity Notice (PON) issued by the CEC in which funding could be provided for the purchase of equipment for new alternative-energy infrastructure projects. The increasing number of natural gas vehicles in the AQMD fleet as well as the existing Omnitrans CNG transit bus fleet require the expansion of the respective fueling facilities to support their operation. On September 21, 2001 the Board recognized, appropriated and authorized the chairman to accept funding support from the CEC for the AQMD Diamond Bar fueling station. However, the CEC requires that a resolution be adopted to receive and administer the funds for the Montclair and San Bernardino Omnitrans stations. After receiving approval from the Technology Committee on September 28, 2001 to proceed with approving the Resolutions, staff devoted time to understand the procedural and administrative requirements of the CEC to ensure that all of the CEC requirements are met. In addition, staff followed Omnitrans’ progress in planning and construction of the L/CNG refueling facility. Staff believes that Omnitrans will complete construction of the facility on schedule with the funding provided by the CEC.

Over the past three years, a number of San Bernardino residents and community interest groups have met with staff, provided extensive public comments at Town Hall meetings, and testified at Board Meetings to express concerns about objectionable odors and other issues related to fugitive emissions from the Omnitrans San Bernardino fueling stations. AQMD staff has provided technical and monitoring assistance to the local government entities involved, and has also made efforts to access funding to update the aging equipment. Some concerned neighborhood residents remain in objection to the site being used for bus refueling regardless of whether the equipment is enhanced to fix leaks. (As in all California jurisdictions, final land use decisions rest with local authorities.)

Omnitrans has looked at the siting situation and has concluded that it would be "operationally prohibitive" to move the station to another site. The City of San Bernardino recently adopted a formal advisory resolution that the fueling operation be relocated.

Proposal

The CEC has approved the funding for the two Omnitrans stations as requested in the Program Opportunity Notice. These stations are the Omnitrans Montclair L/CNG Station and the Omnitrans San Bernardino L/CNG Station. The funding approved by the CEC must be used for the purchase of equipment only and must not exceed 30% of the total project cost. Omnitrans has submitted requests for funding assistance from other programs. To date, Omnitrans has received $400,000 from the Carl Moyer Program and $750,000 from the AES Settlement Funds to build the L/CNG refueling facilities. The funding award from the CEC (shown in the following table), along with funds from the AQMD’s programs, represents about 43% of the total external funds to complete the project. As a condition of the AQMD contract with Omnitrans for this grant, public fueling access will be required
 

In addition to basic project information previously submitted, the CEC requires the Board to approve and endorse resolutions empowering the AQMD to receive the funds. These resolutions are included in this letter as Attachments 1 and 2.

Resource Impacts

There will be minimal costs to administer the contracts with Omnitrans for the CEC funding assistance.

Benefits to AQMD

AQMD’s Clean Fuels Program has been active in funding the development and demonstration of low emission, alternative fuel technologies within its Technology Advancement Office. The AQMD has also supported a number of activities directed to commercialization of low-emission alternative fuel technologies. For these programs to be successful, fleets and other vehicle users must be able to rely on efficient refueling facilities. The proper operation of existing stations must be ensured, and those designing future stations must have access to information that will facilitate their design, construction and operation.

Attachments

1. Resolution for CEC Funding for Omnitrans Montclair Station
2. Resolution for CEC Funding for Omnitrans San Bernardino Station

Attachment 1

RESOLUTION 02-xx

                    A Resolution of the South Coast Air Quality Management District Governing Board to receive revenues and administer funds for the development of a Compressed Natural Gas refueling station at the Omnitrans Montclair Station.

                    WHEREAS, Chapter 52, Statutes of 2000 (Budget Act of 2000), included appropriations from the Petroleum Violation Escrow Account to the California Energy Commission to assist public agencies to establish an infrastructure for dispensing low-polluting motor vehicle fuels; and

                    WHEREAS, the California Energy Commission to achieve its transportation energy program objectives provides funds to cost-share the establishment of Alternative Fuels Infrastructure; and

                    WHEREAS, Omnitrans is desirous to implement a project with Energy Commission Alternative Fuels Infrastructure Program funds for the Montclair Liquefied/Compressed Natural Gas Fueling Station;

                    NOW, THEREFORE, BE IT RESOLVED, that the Executive Officer of the South Coast Air Quality Management District is hereby authorized and empowered to apply for funds and, if recommended for funding, execute for the benefit of Omnitrans an agreement with the California Energy Commission and all other necessary documents to receive and administer CEC funds.

DATE:_____________________            ____________________________
                                                           Clerk of the District Board
 

Attachment 2

RESOLUTION 02-xx

                    A Resolution of the South Coast Air Quality Management District Governing Board to receive revenues and administer funds for the development of a Compressed Natural Gas refueling station at the Omnitrans San Bernardino Station.

                    WHEREAS, Chapter 52, Statutes of 2000 (Budget Act of 2000), included appropriations from the Petroleum Violation Escrow Account to the California Energy Commission to assist public agencies to establish an infrastructure for dispensing low-polluting motor vehicle fuels; and

                    WHEREAS, the California Energy Commission to achieve its transportation energy program objectives provides funds to cost-share the establishment of Alternative Fuels Infrastructure; and

                    WHEREAS, Omnitrans is desirous to implement a project with Energy Commission Alternative Fuels Infrastructure Program funds for the San Bernardino Liquefied/Compressed Natural Gas Fueling Station;

                    NOW, THEREFORE, BE IT RESOLVED, that the Executive Officer of the South Coast Air Quality Management District is hereby authorized and empowered to apply for funds and, if recommended for funding, execute for the benefit of Omnitrans an agreement with the California Energy Commission and all other necessary documents to receive and administer CEC funds.

DATE:_____________________            ____________________________
                                                           Clerk of the District Board

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