South Coast Air Quality Management District

Execute Contracts for AQIP Proposals Received During Second Quarter of 2002

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 second quarter of 2002. This action is to recommend 9 of them for funding. The amount available for this quarter is $2,491,470.

COMMITTEE: 

Mobile Source, October 25, 2002, Recommended for Approval

RECOMMENDED ACTION:

	1)	Authorize the Chairman to execute the following contracts for a total amount not to exceed $2,321,316 from the AQIP Special Revenue Fund.
		a.	A contract with Specialty Environmental Services to repower 5 gasoline powered rental boats with four stroke engines in an amount not to exceed $50,000.
		b.	A contract with Specialty Environmental Services to repower 2 gasoline powered oil spill response boats with four stroke engines in an amount not to exceed $56,000.
		c.	A contract with Bragg Crane Services to repower 3 off-road diesel engines in cranes in an amount not to exceed $67,587.
		d.	A contract with California Street Maintenance to replace four pre-1987 diesel street sweepers with lower-emission propane sweepers in an amount not to exceed $200,000.
		e.	A contract with Seaboard Marine to repower marine vessel Sea Horse in an amount not to exceed $79,500.
		f.	A contract with R. F. Dickson Co., Inc. to repower 8 diesel-powered street sweepers with CNG engines in an amount not to exceed $660,000.
		g.	A contract with Black & Decker (US) Inc. to exchange up to 2,000 gasoline-powered lawn mowers with cordless electric mowers in an amount not to exceed $498,000.
		h.	A contract with F.S.T. Sand & Gravel, Inc. to repower 5 diesel engines used in its off-road construction equipment – 53x2228, 01x2146, 01x04032, 63x3082 and 50w0727 - in an amount not to exceed $310,297.
		i.	Allocate $399,932 to assist in the purchase of natural gas vehicles for taxicab services. Authorize the Executive Officer to approve disbursement of these funds upon the recommendation of the current contractor, Adrianus Resources, Inc.
	2)	Transfer $70,000 from the AQIP Special Revenue Fund to the Science and Technology Advancement Office FY 2002-03 Budget, Services and Supplies Major Object (Public Notice & Advertisement Account $60,000, Miscellaneous Expense Account $10,000) for advertising, scrapping, oil and gas removal, and miscellaneous costs in conjunction with the implementation of the lawn mower electrification program under item # 1 (g) above.
	3)	Authorize the Executive Officer to acquire 8 global positioning systems (GPS) and/or data loggers, to be installed in the Marine Vessels listed above, at a cost not to exceed $18,400.

Barry R. Wallerstein, D.Env.
Executive Officer

Background

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 second quarter of 2002.

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 second quarter of the 2002 participation period ended on June 30, 2002 with 101 employers participating in the AQIP program. The total amount of AQIP funds received during this period was $1,889,019, which includes both annual and triennial participants. In addition, $35,419 is being carried forward from the previous quarters. An additional amount of $610,732 was made available when Sukut Construction, Inc. declined the contract awarded to them at the May 3, 2002 Board Meeting. The Board allocated $43,700 to install GPS units in 19 marine vessels under contract with the Rule 2202 AQIP program. Therefore the total amount available for this quarter is $2,491,470 (see Attachment 1, Table 4). Staff recommends that $2,321,316 be used to purchase emission reductions. The total funding would provide excess emission reductions for the quarter.

Proposal Evaluation

During the bidding process of the second quarter of 2002, 18 proposals were received requesting funds ranging from $50,000 to $1,500,000. The project proposals received can be grouped in three categories: Old-Vehicle Scrapping, Marine Vessels, 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 comprised of one Engineering and Compliance Senior Manager, one Transportation Programs Manager, one Technology Advancement Program Manager, one Planning and Rules Air Quality Specialist, and one Transportation Specialist; one female and four males; one Asian-Indian, three Caucasian, and one Hispanic. Attachment 5 discusses the selection criteria and the overall ratings for each proposal.

Attachment 5 also provides a summary of the proposal rankings. While cost-effectiveness is a heavily weighted criterion for determining ranking and selection of proposals, the amount of funding available, status of the Emissions Bank, and the desire to diversify types of projects ultimately determines the staff recommendation. The proposals selected were not necessarily the most cost-effective in regard to available funds, but met the necessary emission reduction targets, and provided multi-pollutant benefits.

The following proposals are recommended for approval (as detailed in Attachment 6):
 

1. Specialty Environmental Services (Proposal 1)	Option 4A $50,000 & Option 5 $56,000
Specialty Environmental Services proposes to generate emission reductions by re-powering outboard power boats operating on gasoline using 4-stroke engines. All the options are for a period of 5 years. Option 4A is to re-power 5 rental and support boats at a cost-effectiveness of $0.23 per pound; and Option 5 is to re-power 2 oil-spill response boats at a cost-effectiveness of $0.27 per pound.
2. Bragg Crane Services	$67,587
Bragg Crane Services of Fontana proposes to generate emission reductions by re-powering 3 diesel engines (upper) used in its cranes. The cost-effectiveness of this proposal is $0.43 per pound.
3. California Street Maintenance	$200,000
California Street Maintenance of Gardena proposes to generate emission reductions by replacing four pre-1987 diesel street sweepers with new lower-emission propane sweepers. The cost-effectiveness of this proposal is $0.91 per pound.
4. Seaboard Marine	F/V Seahorse         $79,500
Seaboard Marine proposes to generate emission reductions by re-powering diesel powered marine fishing vessel, Sea Horse. Cost-effectiveness of this proposal is $1.06 per pound.
5. R. F. Dickson Co., Inc.	$660,000
R. F. Dickson Co., Inc. proposes to generate emission reductions by re-powering 8 diesel street sweepers with CNG engines. The cost-effectiveness of this proposal is $0.99 per pound.
6. Black & Decker (U.S.) Inc.	$498,000
Black & Decker proposes to generate MSERCs by exchanging 2000 used gasoline lawn mowers with cordless electric units. The cost-effectiveness of this proposal is $1.95 per pound.
7. F.S.T. Sand & Gravel, Inc.	$310,297 County: Riverside
F.S.T. Sand & Gravel, Inc. proposes to generate emission reductions over a period of 7 years by re-powering 5 diesel engines used in its off-road construction equipment – 53x2228, 01x2146, 01x04032, 63x3082 and 50w0727 - The modified cost-effectiveness of this proposal is $1.09 per pound. (Partial Funding)

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:
 

1.	Antelope Valley Press	10.	Korea Central Daily	19.	Precinct Reporter
2.	Black Voice News	11.	La Opinion	20.	Press Enterprise
3.	Chinese Daily News	12.	La Prensa Hispana	21.	Rafu Shimpo
4.	Desert Sun	13.	La Voz Publications	22.	San Bernardino Sun
5.	Eastern Group Publications	14.	Los Angeles Daily News	23.	State of California Contracts
6.	El Chicano	15.	Los Angeles Sentinel		Register
7.	El Informador	16.	Los Angeles Times	24.	The Excelsior
8.	Inland Empire Hispanic News	17.	Orange County Register	25.	The Signal
9.	Inland Valley Daily Bulletin	18.	Philippine News	26.	Wave Community Newspapers

Additionally, potential bidders were identified from the 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. Notice of the RFP was mailed to the Black and Latino Legislative Caucuses and various minority chambers of commerce and business associations; and placed on the Internet at AQMD’s Web site [http://www.aqmd.gov, "Business and Job Opportunities" icon] and AQMD’s 24-hour telephone message line for bidders (909) 396-2724.

A Bidders’ Conference was convened at the AQMD on June 27, 2002 to highlight the requirements of the proposals and to answer questions from the prospective bidders in attendance.

Taxicab Services

The Los Angeles Department of Transportation (LADOT) has provided the AQMD records that indicate when taxicabs must be replaced due to the maximum age requirement of the Board of Taxicab Commissioner’s Rules (Board Order No. 471 et seq.) Based upon this information, staff has identified 169 taxicabs that are expected to be replaced by the end of 2003, and, of these, 30 are due to be replaced by December 31, 2002.

To assist in the compliance to Rule 1194, staff recommends that the Board consider providing assistance to individual taxicab operators at a cost not to exceed $399,932 (up to $15,382 per vehicle) for up to 26 vehicles from the CY 2002 2nd quarter Rule 2202 AQIP.

Taxicab owners, their associations, and the LADOT have been notified by AQMD that in addition to the above Board Order requirement, AQMD Rule 1194 requires them, as airport fleet operators, to procure vehicles certified as an ultra-low-emission vehicle (ULEV) or cleaner, when replacing or adding a taxicab that is authorized to pickup passengers at a commercial airport.

Adrianus Resources, Inc., under contract (#02122) with AQMD, on a task-order basis, provides assistance on implementation of the taxicab provisions of Rule 1194 – Commercial Airport Ground Access. The Contractor assists parties in the purchase of rule compliant alternative-fueled light-duty vehicles needed for taxicab operations. The Contractor serving as the AQMD’s agent prepares applications for financial assistance in the purchase of a new alternative-fueled vehicles.

Lawn Mower Buy-Back Program

Over the last several years the implementation of the lawn mower buy-back programs throughout the State have served to reduce the number of 2- and 4-stroke gasoline powered lawn mower engines. The emissions from these gasoline powered mowers degrade air quality and pose harmful risks for the end users and those residing in the vicinity where they are operated.

A typical 3.5 horsepower gasoline mower can emit the same amount of VOCs in an hour as a new car driven 340 miles. According to data provided by CARB, the annual VOC emissions for one thousand units of lawn mowers is 4.83 tons, including exhaust, evaporative, and spillage emissions. The expedited electrification of these units will help reduce these emissions significantly.

Upon board approval, the lawn mower buy-back program for replacement of older gasoline driven lawnmowers with Black & Decker's battery powered electric mowers will be promoted through a comprehensive outreach campaign including television, radio and print advertising. Specifically, elements of the campaign will include:

• AQMD funding $30,000 for up to 300 10-second radio drive-time traffic spots (based on scheduling availability);
• AQMD funding $20,000 for newspaper display ads in areas near the events;
• AQMD funding $10,000 for permits and other expenses associated with the events;
• Seeking participation of KNBC-TV on-air personalities in events;
• Producing 10,000 information flyers on the events for distribution at participating retailers and other locations;
• Producing banners for display at participating retailers prior to the events;
• Issuing a news release on the events to more than 100 daily, weekly and ethnic newspapers, radio and television stations; and
• Placing information on the program on AQMD’s website and 1-800-CUT-SMOG line.

Global Positioning Systems

In order to increase enforcement activities on marine vessels that are recommended for funding, staff proposes to install global positioning system (GPS) units and/or data loggers on all Board approved marine vessels at a cost not to exceed $18,400. The AQMD will provide the appropriate funding to each marine vessel operator or contractor from this proposed amount to purchase GPS units and/or assorted equipment that meet the needs of the AQMD. It is estimated that each GPS unit and data logger will cost a maximum of $2,300.

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 – 2^nd Quarter 2002

TABLE 1

Funds Received (as of June 30, 2002)

TABLE 2

Annual Participation

TABLE 3

Triennial Participation

ATTACHMENT 1

(Continued)

Total Available Funding
 

ATTACHMENT 2

TABLE 1

Emission Reduction Targets
(Pounds)
 

TABLE 2

Emission Reduction Credit Balances
(Pounds)
 

TABLE 2 (Continued)

Emission Reduction Credit Balances
(Pounds)

ATTACHMENT 3

Summary
Air Quality Investment Program
Proposals Received

The following proposals were received in response to the AQIP Request for Proposals (RFP) on or before August 2, 2002. The proposals are listed alphabetically, not by classification or rank.
 

1. Air Quality Management Services (Proposal 1)	Option A    $211,989 Option B    $245,374 Option C    $979,734 County: Los Angeles
Air Quality Management Services (AQMS) proposes to generate emission reductions over 7 years by re-powering engines on marine vessels. Option A is a proposal to re-power diesel engines on 2 marine vessels at a cost-effectiveness of $0.96 per pound; Option B is a proposal to replace 4-stroke gasoline engines with diesel engines at a cost-effectiveness of $0.72 per pound; Option C is a proposal to replace 500 2-stroke gasoline engines on power boats with 4-stroke gasoline engines at a cost-effectiveness of $1.65 per pound. AQMS has submitted (and awarded) a wide variety of projects under prior solicitations including vehicle scrapping. Relative to Option B, staff does not believe that gasoline engines should be replaced with diesel engines since the NOx emissions would be higher even though the total VOC, NOx, and CO emission would be lower. There are other funding sources for marine vessels that staff believes are more appropriate to support AQMS' proposals. (Not funded.)
2. Black & Decker (U.S.) Inc.	$498,000 County: All
Black & Decker proposes to generate MSERCs by exchanging 2000 used gasoline lawn mowers with cordless electric units. The cost-effectiveness of this proposal is $1.95 per pound. (Funded.)
3. Bragg Crane Services	$67,587 County: All
Bragg Crane Services of Fontana proposes to generate emission reductions by re-powering 3 diesel engines (upper) used in its cranes. The cost-effectiveness of this proposal is $0.43 per pound. (Funded.)
4. California Street Maintenance	$200,000 County: All
California Street Maintenance of Gardena proposes to generate emission reductions by replacing four pre-1987 diesel street sweepers with new lower-emission propane sweepers. The cost-effectiveness of this proposal is $0.91 per pound. (Funded.)
5. Cattrac Construction, Inc.	$220,980 County: San Bernardino
Cattrac Construction, Inc. withdrew their proposal.
6. Don McCoy Corporation (Proposal 1)	$64,405 County: San Bernardino
Don McCoy Corporation withdrew their proposal to re-power off-road diesel construction equipment.
7. Don McCoy Corporation (Proposal 2)	$69,180 County: All
Don McCoy Corporation of San Juan Capistrano proposes to generate emission reductions by retrofitting 10 diesel engine scrapers with oxidation catalysts. The cost-effectiveness of this proposal is $0.84 per pound. However, at this time there are no CARB verified oxidation catalysts to ensure that the emission reductions will be realized. (Not funded.)
8. Earthguard Environmental Services	$1,230,000 County: Los Angeles
Earthguard Environmental Services proposes to provide AQMD-approved Emission Reduction Credits (ERCs) from stationary sources generated by "Process Change." The quantification of these ERCs was verified by the AQMD according to the methodology contained in Regulation XIII, Rule 1306. These ERCs are offered in perpetuity and the cost-effectiveness of this proposal calculated over a 15 year period is $0.91 per pound. The total amount requested represents almost half of the total available funds and would apply only to VOC emission reductions. As such, staff believes that projects with VOC, NOx and CO emission reductions are preferable. (Not funded.)
9. Ebensteiner Co.	$706,096 County: Los Angeles
Ebensteiner Co. proposes to generate emission reductions over a period of 5 years by re-powering 8 diesel engines used in its off-road construction equipment. The cost-effectiveness of this proposal is $1.48 per pound. Staff believes that with the large amount of funds requested for this project, funding of other projects are preferable. (Not funded.)
10. F.S.T. Sand & Gravel, Inc.	$408,423 County: Riverside
F.S.T. Sand & Gravel, Inc. proposes to generate emission reductions over a period of 7 years by re-powering 7 diesel engines used in its off-road construction equipment. The cost-effectiveness of this proposal is $1.22 per pound. (Partially funded.)
11. Pick Your Part Auto-Wrecking	Option 1    500,000 Option 2    750,000 Option 3 1,000,000 Option 4 1,500,000 County: All
Pick Your Part Auto-Wrecking proposes to generate MSERCs by eliminating pre-1982 vehicles through old-vehicle scrapping. The cost-effectiveness of these four proposals ranges from $3.27 to $3.31 per pound. (Not funded.)
12. R. F. Dickson Co., Inc.	$660,000 County: Los Angeles
R. F. Dickson Co., Inc. proposes to generate emission reductions by re-powering 8 diesel street sweepers with CNG engines. The cost-effectiveness of this proposal is $0.99 per pound. (Funded.)
13. Riverside County Economic Development Agency	$420,000 County: Riverside
Riverside County Economic Development Agency proposes to generate emission reductions by replacing two diesel street sweepers with new lower-emission CNG sweepers. The cost-effectiveness of this proposal is $156.09 per pound. (Not funded.)
14. Seaboard Marine (Proposal 1)	F/V Seahorse              $79,500 F/V Fin Fever           $107,000 F/V Sum Fun              $79,000 F/V Barbara H         $166,000 F/V Rebel II             $215,000 F/V Donna B            $191,000 F/V Flore D’Marie  $191,000 F/V Vessel Assist      $55,000 F/V Mako                $140,000 F/V Mr. C                  $95,000 F/V Kodac                $135,000 F/V Catalina King    $360,000 County: Los Angeles
Seaboard Marine proposes to generate emission reductions by re-powering 12 diesel powered marine fishing vessels (F/V.) Average cost-effectiveness of this proposal ranges from $1.06 to $2.81 per pound. Staff recommends funding one of the twelve proposals based on cost and cost effectiveness. There are other sources of funding for marine vessel projects at this time. Staff believes other projects that provide greater localized benefits should be funded at this time. (F/V Sea Horse funded.)
15. Specialty Environmental Services (Proposal 1)	Option 1        $160,000 Option 2        $560,000 Option 3        $660,000 Option 4A       $50,000 Option 4B  $1,280,000 Option 5          $56,000 County:   Los Angeles
Specialty Environmental Services proposes to generate emission reductions by re-powering outboard power boats operating on gasoline using 4-stroke engines. All the options are for a period of 5 years. Option 1 is to re-power 40 rental fishing skiffs at a cost-effectiveness of $0.28 per pound; Option 2 is to re-power 22 movie support boats, excursion boats and personal water crafts at a cost-effectiveness of $0.24 per pound; Option 3 is to re-power 72 rental fishing skiffs and large pontoon boats at a cost-effectiveness of $0.27 per pound; Option 4A is to re-power 5 rental and support boats at a cost-effectiveness of $0.23 per pound; Option 4B is to re-power 139 boats at a cost-effectiveness of $0.17 per pound and Option 5 is to re-power 2 oil-spill response boats at a cost-effectiveness of $0.27 per pound. Staff recommends funding Options 4A and 5 of the proposed projects at this time. There are other sources of funding for marine vessel projects at this time. Staff believes other projects that provide greater localized benefits should be funded at this time. (Options 4A & 5 funded.)
16. Specialty Environmental Services (Proposal 2)	$250,000 County: Los Angeles
Specialty Environmental Services proposes to generate emission reductions by re-powering 10 pre-1987 on-road diesel trucks with low NOx and PM10 engines at cost-effectiveness of $2.00 per pound (Not funded.)
17. Sukut Construction, Inc.	$70,635 County: Orange
Sukut Construction, Inc. proposes to generate emission reductions by re-powering 3 diesel engines used in construction machines. The cost-effectiveness of this proposal is $1.30 per pound. Sukut declined a $610,000 award from the previous quarter due to uncertainty on the proposed project life, the amount of credit generation, and cost-effectiveness. After discussion with the project proponent staff recommends to proceed with other projects in this quarter. (Not funded.)
18. Webco Sweeping	$100,000 County: All
Webco Sweeping of Long Beach proposes to generate emission reductions by replacing two diesel street sweepers with new lower-emission CNG sweepers. The cost-effectiveness of this proposal is $1.64 per pound. The proposed project would not reduce VOC emissions and would only reduce small amounts of NOx in a ten-year project life. As such, staff believes that projects with VOC, NOx, and CO emission reductions and shorter project life are preferable. (Not funded.)

ATTACHMENT 4

Proposal Summary By Type
 

Old-Vehicle Scrapping	AQIP Funding Request	Total Program Cost	AQIP Program Period	Emission Reduction Commitments (lbs.)
				VOC	NOx	CO
Pick Your Part Auto-Wrecking (Option 1)	$500,000	$500,000	3 Years	57,297	32,460	428,220
Pick Your Part Auto-Wrecking (Option 2)	$750,000	$750,000	3 Years	87,372	48,375	642,240
Pick Your Part Auto-Wrecking (Option 3)	$1,000,000	$1,000,000	3 Years	118,356	65,205	857,760
Pick Your Part Auto-Wrecking (Option 4)	$1,500,000	$1,500,000	3 Years	177,807	97,470	1,285,140

ATTACHMENT 4
(Continued)
 

ATTACHMENT 4
(Continued)
 

ATTACHMENT 5

Summary

Proposal Ratings

All proposals submitted were reviewed and scored according to the selection criteria in the Board-approved RFP. Points were also allocated for "Local Business," "Small Business," DBVE and DBVE "Joint Ventures."
 

ATTACHMENT 5
(Continued)
 

ATTACHMENT 5
(Continued)
 

ATTACHMENT 6

TABLE 1

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

TABLE 2

Proposals Recommended for Funding
Funding Request
 

/ / /