BOARD MEETING DATE: August 6, 2004
AGENDA NO. 11B
(Continued from the July 9, 2004 Board Meeting)

Award Contract for Liquefied Natural Gas Refueling Station Infrastructure to SYSCO Food Services

SYNOPSIS:

On October 3, 2003, the Board approved release of a $1.5 million RFP to solicit proposals for natural gas refueling station infrastructure projects from the Clean Fuels Fund. Twenty-six proposals were received by the RFP deadline of December 16, 2003. This action is to approve a contract award from this RFP to SYSCO Food Services. Total AQMD funding for this project shall not exceed $250,000 from the Clean Fuels Fund

COMMITTEE:

Technology, April 23, 2004, Recommended for Approval

RECOMMENDED ACTION:

1)	Authorize the Chairman to execute a contract with SYSCO Food Services in an amount not to exceed $250,000 from the Clean Fuels Fund to offset the costs of purchasing and installing a new LNG fueling system at their food distribution center in the City of Walnut.

Barry R. Wallerstein, D.Env.
Executive Officer

Background

On October 3, 2003, the Board authorized release of RFP #P2004-09 soliciting cost-shared proposals for installing new natural gas fueling facilities within the South Coast AQMD jurisdictional boundaries. Continued expansion of the natural gas fueling infrastructure needs to occur in order to support increased public and private fleet fueling needs and support future incentive program awards such as the Chairman’s School Bus Replacement Initiative and the Carl Moyer Program.

The Board approved a total of $1.5 million from the Clean Fuels Fund to support the RFP. This funding is designed to offset capital investment costs, resulting in conveniently located, publicly-accessible fueling stations. For this RFP, funding was only provided for natural gas fueling stations. Applications were accepted from either public agencies or private entities (i.e. state and local governments, automobile manufacturers, alternative fuel suppliers, manufacturers of natural gas related equipment, and end users of natural gas motor fuel). While the RFP did not require components to be currently hydrogen compatible, it provided for additional points for considering such hydrogen compatibility issues. In any event, staff believes that natural gas fueling stations are inherently hydrogen-compatible because the fuel may be used to generate hydrogen.

The level of required cost share is based upon the amount of grant funds requested (see Table 1 below) and the cost share is based upon cash expenditures, (i.e. land/lease, equipment, engineering, permits, installation, etc.). In-kind services are limited to 10 percent.

Table 1. Cost-Share Request Limitations
 

The general requirements of the RFP are identified below:

1)	Proposed project must be located within the jurisdictional boundaries of the South Coast Air Quality Management District.
2)	Proposed project shall be a natural gas "fast-fill" station with public access.
3)	Project schedule shall be limited to an eighteen-month timeframe.
4)	Proposed project may request cost-share funds for capital investment costs only.
5)	Applicant will be contractually obligated to proposed station throughput.

Twenty-six proposals were received by December 16, 2003 (the closing date of the solicitation) totaling $4.6 million in requested funding.

Proposal

As mentioned above, 26 proposals were received by the RFP deadline of December 16, 2003. Figure 1 shows the geographical locations of the 26 proposed refueling station projects and differentiates between stations that incorporated hydrogen compatibility design and equipment specifications and those that did not. As seen in Figure 1, in addition to the existing infrastructure network, these new projects are strategically located to help establish an infrastructure "backbone" that will allow for fueling of all types of natural gas vehicles throughout the Basin.

Figure 1. Locations of the Existing and the 26 Proposed Natural Gas Refueling Stations

All proposals received in response to RFP #2004-09 were evaluated and scored by a diverse, technically qualified panel in accordance with criteria contained in the RFP. The evaluation panel’s technical scores for each proposal are provided in Attachment A. Sixteen of the 26 proposals are deemed technically qualified.

As codes and standards for hydrogen fueling stations do not currently exist, the RFP did not require components to be currently hydrogen compatible; however, it provided for additional points to applicants committing to station designs and space consideration that could incorporate hydrogen compatible equipment for future transportation applications. Equipment modifications and retrofitting with hydrogen compatible plumbing, tubing, dispensers and compressors qualified for these additional points. Of the twenty-six proposals received, twenty made specific commitments for making the fueling infrastructure project hydrogen compatible in the future. Of the sixteen proposals recommended for funding, all sixteen have made specific commitments for making the fueling infrastructure project hydrogen compatible in the future.

SYSCO Food Services proposed LNG project is already compatible with the dispensing of liquid hydrogen by the facility design and construction. SYSCO Food Services will make additional space and design improvements in order to facilitate the addition of hydrogen refueling equipment later.

SYSCO Food Services received a technical score above the minimum criteria of 56 points. Staff is recommending that the proposed project with SYSCO Food Services be funded from the original $1.5 million allocated by the Board for the subject RFP.

Benefits to AQMD

The AQMP relies on the expedited implementation of advanced technologies and clean–burning fuels in Southern California to achieve air quality standards. By constructing more natural gas fueling facilities, benefits from this project will accrue to all cities and area residents. Such new construction will provide a coordinated effort, plan for growth of the overall infrastructure and enable the transition to future hydrogen refueling infrastructure. There are economies of scale from the extensive infrastructure being planned and installed, possibly reducing the cost and making alternative refueling stations more affordable. While having no direct impact on air emission reductions, new CNG stations will help facilitate the introduction of low emission, natural gas fueled vehicles (NGVs) initially in private and public fleets in the area. Such increased penetration of NGVs will provide direct emissions reductions of NOx, VOC, CO, PM, and air toxic compounds throughout the Basin.

Outreach

In accordance with AQMD’s Procurement Policy and Procedure, 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 notified utilizing the Los Angeles County MTA Directory of Certified Firms, the Inland Area Opportunity Pages Ethnic/Women Business & Professional Directory; and AQMD’s own electronic listing of certified minority vendors. 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 where it could be viewed by making menu selections "Inside AQMD"/"Employment and Business Opportunities"/"Business Opportunities" or by going directly to http://www.aqmd.gov/rfp/index.html). Information was also available on AQMD’s bidder’s 24-hour telephone message line (909) 396-2724.

In addition to publication in the above-cited publications, over 100 individual RFP notices were mailed to interested businesses and individuals.

Bid Evaluation

Proposals received were evaluated by a diverse, technically qualified panel in accordance with criteria contained in the attached RFP. The evaluation panel consisted of a representative from CARB, an independent technical expert, and the AQMD Fleet Rules Implementation Manager. The panel make-up consisted of one Asian/Pacific Islander, one Caucasian, and one Hispanic; two female and one male. Attachment A provides a summary of the proposals received ranked by the scores received from the evaluation panel.

Twenty-six proposals were received with requested funding totaling $4.6 million. Of the 26 proposals received, 16 were scored with a technical value above 56 points (the minimum score needed for further consideration). The remaining 10 proposals are not deemed for funding consideration since they did not meet the requirements of the RFP or was not sufficiently clear in the project proposal.

In accordance with approved AQMD RFP guidelines, the least-cost proposal was awarded the most points in the cost category. All other proposals received a percentage of that highest score, with proposals costing over twice the lowest score getting zero points.

Some of the proposals are recommended to receive only partial funding compared to their original request. The partial funding recommendations are based on adjustments to the requested funding amount to represent the upper throughput limits specified in the RFP. In one proposal, the project proponent indicated that additional funds that were not originally anticipated are being provided at this time. Therefore, the recommended AQMD funding is reduced from the original request.

Resource Impacts

Funding in an amount not to exceed $250,000 from the Clean Fuels Fund, is proposed to fund the proposal from SYSCO Food Services. This funding is from the $1.5 million originally allocated by the Board for the RFP.

Attachment

Attachment A. - Evaluation of Proposals RFP #P2004-09 Recommended for Awards

Attachment A
Evaluation of Proposals RFP #P2004-09 Recommended for Awards
 

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