BOARD MEETING DATE: September 3, 2004
AGENDA NO. 7

Approve Expenditures for Activities and Projects Selected by the California Natural Gas Vehicle Partnership During FYs 2004-05 and 2005-06, and Recognize Funding from Participating Members

SYNOPSIS:

On April 5, 2002, the Board approved the establishment of a Natural Gas Vehicle Partnership Fund and authorized the Executive Officer to approve expenditures in FY 2002-03 for projects selected by the Partnership up to $50,000 for individual expenditures, for a total amount not to exceed $200,000. On April 4, 2004, the Board authorized the Executive Officer to approve expenditures in FY 2003-04. The participating members pay two-year membership fees to fund program administration, specific projects, and activities to achieve the goals of the partnership. This action is to: (1) recognize funding from participating members of the Natural Gas Vehicle Partnership; (2) transfer $25,000 from the Clean Fuels Fund as AQMD’s contribution; (3) authorize the Executive Officer to approve up to $50,000 for individual expenditures selected by the Partnership in FY 2004-05 and 2005-06, for a total amount not to exceed $275,000 for each fiscal year; and (4) authorize the Executive Officer to approve modification to CALSTART contract #04066 in the amount of $16,300.

COMMITTEE:

Technology, August 27, 2004, Recommended for Approval

RECOMMENDED ACTIONS:

1. Recognize approximately $400,000 in revenue from participating members of the California Natural Gas Vehicle Partnership into the Natural Gas Vehicle Partnership Fund.
    
2. Authorize the transfer of $25,000 from the Clean Fuels Fund to the Natural Gas Vehicle Partnership Fund as AQMD’s contribution.
    
3. Authorize the Executive Officer to approve expenditures for activities and projects selected by the California Natural Gas Vehicle Partnership during FY 2004-05 and 2005-06 in budgeted amounts not to exceed $50,000 for individual expenditures, $275,000 in total for each fiscal year as outlined in Table 1, from the Natural Gas Vehicle Partnership Fund provided there would be sufficient funds available.
    
4. Authorize the Executive Officer to approve modification to CALSTART contract 04066 for the continuation of web hosting, web maintenance and web support of the Partnership website in the not to exceed amount of $16,300; total CALSTART contract value will be $66,300.

Barry R. Wallerstein, D.Env.
Executive Officer

Background

At its February 1, 2002 meeting, the Board approved the work plan for eight Strategic Alliance Initiatives. The Initiatives were set forth to strengthen and create new partnerships at the local, state, and federal level. One of these initiatives was the creation of the California Natural Gas Vehicle (NGV) Partnership with the objective of accelerating the development of advanced natural gas vehicle technologies to provide a benchmark for lowering emissions from petroleum based engines and to provide a pathway to future fuel cell use in the next two decades.

Under this initiative, the AQMD has spearheaded the formation of this strategic alliance (comprised of state and federal air quality, transportation and energy agencies, together with vehicle and engine manufacturers, fuel providers, transit and refuse hauler organizations), to facilitate the advancement of NGV technology and deployment. Under the activities of the Partnership, the AQMD has led the formation of the Partnership’s Steering Committee that meets on a quarterly basis with high-level representation from each participating member. The Steering Committee has adopted five specific goals as outlined below and has set a specific agenda to achieve its goals during the next ten years.

1. Promote research, development, demonstration, and deployment and commercialization efforts in the advancement of natural gas engine and fueling technology.
    
2. Increase awareness and urge the active participation among local, state, and federal policymakers regarding the use of NGVs and natural gas as a low-emission fuel, and promotion of future advancement in vehicle & fueling technologies to further reduce emissions.
    
3. Promote availability of financial and non-financial incentives and technical assistance for deployment of natural gas vehicles and infrastructure.
    
4. Encourage the purchase of dedicated NGVs by conducting public outreach for local, state, and federal purchasing programs.
    
5. Establish as its goal the deployment of specific numbers and types of light-, medium-, and heavy-duty natural gas vehicles and infrastructure during the next three, five and ten years.

Proposal

The Partnership Steering Committee is currently comprised of nineteen paying and nineteen non-paying members (Attachment 1). Each paying member contributes a two-year membership fee of $25,000 to fund specific projects to achieve the goals of the Partnership. A special Natural Gas Vehicle Partnership Fund account was approved by the Board to receive the membership fees.

The Partnership Steering Committee has approved expenditures for activities such as conducting outreach workshops in California, and establishing and operating a website and mailing of an electronic newsletter to achieve the goals of the Partnership in an expedited manner. At this point, it is more important for the Partnership to fund projects to implement the goals of the Partnership.

At the September 18, 2003 meeting of the Steering Committee, an expenditure of up to $30,600 to CALSTART to perform website services for the Partnership to assist the Partnership achieve its goals was approved. Under this contract, CALSTART has provided web hosting, web maintenance and web support of the Partnership website for six months. On April 28, 2004, the Steering Committee approved a seven month extension of this contract in the amount of $35,700 with an option to renew for an additional six months. Total cost of this modification is $35,700. Per the AQMD Procurement Policy, only $19,400 has been added to the existing contract to bring the contract value to $50,000, which can be approved by the Executive Officer. Staff seeks Board approval for the additional $16,300 that has already been approved by the Steering Committee to continue the work being performed by CALSTART. The total CALSTART contract value will be $66,300.

In addition, at its April 5, 2002 meeting the Board authorized the Executive Officer to approve individual expenditures up to $50,000 for projects selected by the Partnership during the first year of its activity. This authorization was extended by the Board at its April 4, 2004 meeting for FY 2003-04. Staff is recommending that the Board extend this authorization for FY 2004-05 and 2005-06 to coincide with the two-year membership term. This will continue to expedite the project selection and implementation process, and will help the Partnership’s Steering Committee to function effectively. The proposed FY 2004-05 and 2005-06 Budget is outlined in Table 1 below.

Table 1: FY 2004-05 & 2005-06 PROPOSED BUDGET
 

If for some reason, there is need to modify the above budget by the Partnership’s Steering Committee during FY 2004-05 or 2005-06, the Executive Officer will report back to the Board and will seek approval for the modified budget.

Benefits to AQMD

The implementation of this initiative has brought public and private stakeholders together and assists in the development and deployment of a specific number of advanced natural gas vehicles and refueling infrastructure expansion over the next five to ten years. This will in turn increase natural gas’s role as a low emission displacement or augmentation to petroleum fuel where economically feasible.

Resource Impact

The current fund balance plus the expected membership fees of $400,000 is sufficient to cover the anticipated expenditures of the Partnership for the next two-years. Total cost of projects for the California NGV Partnership during FY 2004-05 and 2005-06 shall not exceed $275,000 for each fiscal year, provided there would be sufficient funds in the NGV Partnership Fund. The sources of funds are from the Partnership’s membership dues for a two-year period. The AQMD has provided $25,000 to cover membership dues in the Partnership and has provided in-kind support to administer the Partnership activities. There are no other fiscal impacts associated with the recommended action.

Attachment

1. California Natural Gas Vehicle Partnership Members List

Attachment 1


California Natural Gas Vehicle Partnership Members List

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