BOARD MEETING DATE: February 4, 2005
AGENDA NO. 9

Approve RFP Issuance and Multiple New/Modified Contract Awards as Part of MSRC's FYs 2004-05 and 2001-02 AB 2766 Discretionary Fund Work Programs; Grant MSRC Authority to Adjust Project Costs Up to Five Percent; and Authorize Board Chairman to Execute Agreements

SYNOPSIS:

On August 6, 2004, the Board approved the FY 2004-05 AB 2766 Discretionary Fund Conceptual Work Program, including $1 million for a Diesel Exhaust After-Treatment Retrofit Program and $1.75 million for an On-Road Diesel Vehicle Replacement Program, subject to MSRC and AQMD Board approval. On January 27, 2005, the MSRC approved 18 contract awards under the Diesel Exhaust After-Treatment Retrofit Program, one sole-source award to Gateway Cities Council of Governments to administer the On-Road Diesel Vehicle Replacement Program, and four contract awards under the Off-Road Heavy-Duty Vehicle Program. These awards included use of $2,667,804 in turn-back funds. Concurrently, the MSRC also approved release of an RFP for technical advisor services and modifications to a contract award to Orange County Transportation Authority from the FY 2001-02 Work Program. The MSRC requests the AQMD Board’s approval of these new/modified awards as part of the FYs 2004-05 and 2001-02 Work Programs. Finally, the MSRC requests authority to adjust contracts up to five percent and authority for the Board Chairman to execute agreements.

COMMITTEE:

Mobile Source Air Pollution Reduction Review Committee, January 27, 2005, Unanimously Approved

RECOMMENDED ACTIONS:

1. Approve the award of 17 contracts totaling $2,150,500 under the Diesel Exhaust After-Treatment Retrofit Program, funded with $1,500,000 from the FY 2004-05 AB 2766 Discretionary Fund Work Program and $650,500 from turn-back funds, as described in this letter and as follows:

1.1	A contract with City of Montclair in an amount not to exceed $68,000 for up to 8 retrofit devices;
1.2	A contract with City of Hemet in an amount not to exceed $34,000 for up to 4 retrofit devices;
1.3	A contract with Los Angeles County Public Works in an amount not to exceed $150,000 for up 25 retrofit devices;
1.4	A contract with Los Angeles County Sanitation Districts in an amount not to exceed $150,000 for up to 41 retrofit devices;
1.5	A contract with First Student, Inc. in an amount not to exceed $150,000 for up to 59 retrofit devices;
1.6	A contract with City of Long Beach in an amount not to exceed $144,000 for up to 8 retrofit devices;
1.7	A contract with City of San Bernardino in an amount not to exceed $150,000 for up to 18 retrofit devices;
1.8	A contract with City of Los Angeles Department of Water & Power in an amount not to exceed $150,000 for up to 264 retrofit devices;
1.9	A contract with City of Pomona in an amount not to exceed $42,500 for up to 5 retrofit devices;
1.10	A contract with Caltrans in an amount not to exceed $144,000 for up to 8 retrofit devices;
1.11	A contract with Orange County Transportation Authority in an amount not to exceed $150,000 for up to 71 retrofit devices;
1.12	A contract with Atlantic Express in an amount not to exceed $150,000 for up to 119 retrofit devices;
1.13	A contract with Eastern Municipal Water District in an amount not to exceed $150,000 for up to 20 retrofit devices;
1.14	A contract with CR&R Inc. in an amount not to exceed $150,000 for up to 18 retrofit devices;
1.15	A contract with Waste Management in an amount not to exceed $150,000 for up to 18 retrofit devices;
1.16	A contract with Yucaipa Bus Service in an amount not to exceed $68,000 for up to 8 retrofit devices; and;
1.17	A contract with City of Corona in an amount not to exceed $150,000 for up to 18 retrofit devices;

2. Approve a sole-source award in the amount of $1,750,000 to the Gateway Cities Council of Governments to administer the On-Road Heavy-Duty Diesel Vehicle Replacement Program as part of the FY 2004-05 AB 2766 Discretionary Fund Work Program, as described in this letter;
    
3. Approve the award of four contracts totaling $2,017,304 under the Off-Road Heavy-Duty Vehicle Program, all of the funding for which comes from turn-back funds, as part of the FY 2004-05 AB 2766 Discretionary Fund Work Program, as described in this letter and as follows:

3.1	A contract with Road Builders, Inc. in an amount not to exceed $124,912 for up to two wheel scrapers;
3.2	A contract with Varner Construction in an amount not to exceed $670,404 for up to ten rock trucks;
3.3	A contract with Jagur Tractor in an amount not to exceed $743,988 for up to seven scrapers; and
3.4	A contract with Caufield Equipment in an amount not to exceed $478,000 for up to four scrapers;

4. Approve issuance of RFP for MSRC Technical Advisor Services for support commencing FY 2005-06, with the amount to be determined based on proposals and associated available funds in the next fiscal year, subject to MSRC and AQMD Board approval at a later date;
    
5. Approve contract modifications for Orange County Transportation Authority to reduce award to $10,000 for facility modifications as part of the FY 2001-02 Work Program;
    
6. Authorize MSRC the authority to adjust contract awards up to five percent, as necessary; and
    
7. Authorize the Chairman of the Board to execute multiple contracts and/or modifications as part of FY 2004-05 AB 2766 Discretionary Fund Work Programs, as described above and within this letter.

Ron Roberts
Vice-Chair, MSRC

Background

In September 1990 Assembly Bill 2766 was signed into law (Health & Safety Code Sections 44220-44247) authorizing the imposition of an annual $4 motor vehicle registration fee to fund the implementation of programs exclusively to reduce air pollution from motor vehicles. AB 2766 provides that 30 percent of the annual $4 vehicle registration fee subvened to the AQMD be placed into an account to be allocated pursuant to a work program developed and adopted by the MSRC and approved by the AQMD Governing Board.

On August 6, 2004, the AQMD Board approved the MSRC’s $15.3 million FY 2004-05 AB 2766 Discretionary Fund Work Program in Concept, including $1 million for a Diesel Exhaust After-Treatment Retrofit Program and $1.75 million for an On-Road Diesel Vehicle Replacement Program, subject to MSRC and AQMD Board approval. Further background is provided below.

FY 2004-05 Work Program

1. Diesel Exhaust After-Treatment Retrofit Program
   This Program Announcement (PA) (#2005-02) provided $1 million towards the purchase of CARB-certified exhaust after-treatment devices to retrofit existing diesel vehicles. The PA provided up to $8,500 per unit for CARB-verified particulate filters and up to $18,500 per unit for devices reducing both NOx and PM. No additional funding was provided to offset low sulfur fuel costs for this funding cycle. Funding was to be awarded on a first-come, first-serve basis with all proposals received the first day to be considered received concurrently. If more applications were received the first day than available funding, eligible applications would be funded on a prorated basis. The PA had open application period commencing September 24, 2004 and ending October 26, 2004. A cap of $150,000 per entity was established to ensure broad distribution throughout the South Coast Air District. Subsequent to the release of the PA, the MSRC augmented the funding target by an additional $500,000 for a total of $1.5 million allocated for this element. Seventeen proposals were approved at the MSRC’s January 27, 2005 meeting; details are provided in the Proposals section.
    
2. Off-Road Heavy-Duty Vehicle Program
   This RFP (#P2005-06) provided $2.75 million co-funding for off-road heavy-duty vehicles, allowing alternative fuel and diesel-to-diesel repowers utilizing Tier II engines. Tier II engines must achieve an emissions level of 4.8 g/bhp-hr NOx plus non-methane hydrocarbon (NMHC). Infrastructure funding was also available with a minimum vehicle purchase: up to $100,000 with ten qualifying vehicles and up to $50,000 with five qualifying vehicles. The maximum per vehicle award was capped at the cost-effectiveness threshold of $13,600 per ton of NOx reduced. Funds were to be awarded on a cost-effectiveness basis. Where proposals are equally cost effective, they were to be ranked in order of receipt. On November 18, 2004, the MSRC approved four contracts totaling $2,750,000, and established a backup list of eligible projects totaling more than $5 million. At its January 27, 2005 meeting, the MSRC approved four additional contract awards under this element of the Work Program; details are provided in the Proposals section.
    
3. On-Road Diesel Vehicle Replacement Program
   In the FY 2002-03 Work Program the MSRC allocated $1 million for a sole-source contract to partner with the Gateway Cities Council of Governments (COG) to participate and enhance a Heavy-Duty Diesel Vehicle Replacement Program at the Ports of Long Beach and Los Angeles. The Program successfully replaced 34 older, high-polluting diesel trucks with newer, lower-polluting diesel vehicles. The average cost-effectiveness for the Program was $7,761 per ton of NOx reduced. Based on the success of this program, the MSRC allocated $1.75 million in the FY 2004-05 Work Program to implement a follow-on Program, expanded to include independent owner/operators within each county, and adding an outreach component to ensure broad-based participation throughout the basin. At its January 27, 2005 meeting, the MSRC approved a sole-source award to implement this follow-on effort; details are provided in the Proposals section.

FY 2005-06

4. RFP for MSRC Technical Advisor Services
   The MSRC retains an independent contractor to provide technical assistance in support of the AB 2766 Discretionary Fund Program. Contracts are awarded through a competitive bid process and have traditionally included three one-year option clauses. The services are funded partially from the Work Program (25%) and partially from the MSRC’s Administrative Budget (75%), which is statutorily set at 5% of revenues. The current Technical Advisor contract expires June 30, 2005. The MSRC’s Technical Advisory Committee prepared a draft RFP to solicit proposals for services beginning in FY 2005-06. On January 27, 2005, the MSRC reviewed the RFP specifics; details are provided in the Proposals section.

FY 2001-02 Work Program

5. Contract Modification for Orange County Transportation Authority (OCTA)
   In the FY 2001-02 Work Program, the OCTA awarded $286,471 towards the purchase of 21 LNG buses under Alternative Fuel Transit Bus Program. OCTA requested that the award be modified to transfer funding to its LNG refueling infrastructure and maintenance facilities. At its May 27, 2004 meeting, the MSRC considered this request; details are provided in the Proposals section.

Outreach

In accordance with the AQMD's consulting and contracting policies, a public notice advertising the solicitations was published on two different days in 25 newspapers and publications, including several targeting minorities. The solicitations were also placed on the MSRC's website at "http://www.msrc-cleanair.org" as well as the AQMD's website at "http://www.aqmd.gov" under the "Business and Job Opportunities" icon, and information was included about them on the AQMD's 24-hour telephone message line for bidders at (909) 396-2724.

In addition to the AQMD's standard practices, a postcard announcing all of the MSRC's funding opportunities was mailed to over 1,600 interested parties on the MSRC's mailing list, as well as to the Black and Latino Legislative Caucuses, City Managers, Chambers of Commerce, the AQMD's Ethnic Communities Advisory Group, and business associations. Solicitations were downloaded from the MSRC's website and mailed upon request.

For RFP #P2005-21 for MSRC Technical Advisor Services, the above outreach will also be conducted, including a targeted mailing as applicable.

Bidders' Conferences

Bidders' conferences were conducted in August 2004 at AQMD headquarters for the FY 2004-05 Work Program solicitations. A general question-and-answer session was conducted.

For RFP #P2005-21 for MSRC Technical Advisor Services, interviews may be conducted with top-ranked bidders. No bidders’ conference is deemed worthwhile, but interested bidders can seek clarifications from the AQMD’s Procurement Manager, the chair of the MSRC’s Technical Advisory Committee (MSRC-TAC), and AQMD’s Program Liaison to the MSRC, Henry Hogo. Contact information is outlined in the RFP.

Evaluation Process

The MSRC-TAC formed evaluation subcommittees to review the proposals and applications to determine eligibility, using the criteria within the solicitations (described above). At its January 27, 2005 meeting, the MSRC considered recommendations from its MSRC-TAC.

Sole-Source Justification

The MSRC allocated $1,750,000 as part of the FY 2004-05 Work Program to implement an On-Road Diesel Vehicle Replacement Program. This was intended as a follow-on program to the previous successful partnership with the Gateway Cities COG. The COG has developed extensive tools, policies and practices to allow them to efficiently implement and monitor a Heavy-Duty Diesel Truck Replacement Program. In addition, the COG is currently implementing a similar diesel truck replacement program for the Port of Los Angeles. While the MSRC and AQMD strive to retain technical and programmatic services on a competitive bid basis, the AQMD’s Procurement Policy recognizes that at times the unique experience of one entity makes the pursuit of a competitive process futile. Such is the case for the Program Management for this follow-on effort. Therefore, this request for a sole-source award is made under provision B.2.c.1.: The unique experience and capabilities of the proposed contractor or contractor team. The Gateway Cities COG is in a unique position to administer the MSRC’s On-Road Diesel Vehicle Replacement Program. It is the intent of the MSRC to execute a sole-source contract in the amount of $1,750,000, with the Gateway Cities COG to administer the MSRC’s Program.

Proposals

On January 27, 2005, in a 5-0 vote, the MSRC considered recommendations from its MSRC-TAC, recognized $2,667,804 in residual and turn-back funds which could be applied to backup list eligible projects, and unanimously approved multiple contract awards, release of an RFP, and a sole-source contract award. The MSRC actions and recommended contract awards are as detailed below.

FY 2004-05 Work Program

1. Diesel Exhaust After-Treatment Retrofit Program
   The MSRC unanimously approved funding 17 applications totaling $2,150,500 under the Diesel Exhaust After-Treatment Retrofit Program. Initially the MSRC approved funding a prorated portion of the 15 applications received on the first day. Ultimately, the MSRC unanimously approved funding all eligible applications received under this Program, using $650,500 from turn-back funds. Awards are as follows:

1. A contract with City of Montclair in an amount not to exceed 68,000 for up to 8 retrofit devices;
    
2. A contract with City of Hemet in an amount not to exceed $34,000 for up to 4 retrofit devices;
    
3. A contract with Los Angeles County Public Works in an amount not to exceed $150,000 for up 25 retrofit devices;
    
4. A contract with Los Angeles County Sanitation Districts in an amount not to exceed $150,000 for up to 41 retrofit devices;
    
5. A contract with First Student, Inc. in an amount not to exceed $150,000 for up to 59 retrofit devices;
    
6. A contract with City of Long Beach in an amount not to exceed $144,000 for up to 8 retrofit devices;
    
7. A contract with City of San Bernardino in an amount not to exceed $150,000 for up to 18 retrofit devices;
    
8. A contract with City of Los Angeles Department of Water & Power in an amount not to exceed $150,000 for up to 264 retrofit devices;
    
9. A contract with City of Pomona in an amount not to exceed $42,500 for up to 5 retrofit devices;
    
10. A contract with Caltrans in an amount not to exceed $144,000 for up to 8 retrofit devices;
     
11. A contract with Orange County Transportation Authority in an amount not to exceed $150,000 for up to 71 retrofit devices;
     
12. A contract with Atlantic Express in an amount not to exceed $150,000 for up to 119 retrofit devices;
     
13. A contract with Eastern Municipal Water District in an amount not to exceed $150,000 for up to 20 retrofit devices;
     
14. A contract with CR&R Inc. in an amount not to exceed $150,000 for up to 18 retrofit devices;
     
15. A contract with Waste Management in an amount not to exceed $150,000 for up to 18 retrofit devices;
     
16. A contract with Yucaipa Bus Service in an amount not to exceed $68,000 for up to 8 retrofit devices; and;
     
17. A contract with City of Corona in an amount not to exceed $150,000 for up to 18 retrofit devices.

2. Off-Road Heavy-Duty Vehicle Program
   On November 18, 2004, the MSRC approved four contracts totaling $2,750,000, and established a backup list of eligible projects totaling more than $5 million. The AQMD Board subsequently approved the four contracts at its January 7, 2005 meeting. Any projects to be funded under the backup list would be considered separately by the MSRC and AQMD Board. At its January 27, 2005 meeting, the MSRC allocated the remaining turn-back funds totaling $2,017,304 to fund off-road projects as far down the ranked list as available monies would allow. Projects on the backup list were ranked based on cost-effectiveness. Based on available monies, the MSRC was able to award four more contracts under this element of the Work Program. Awards are as follows:

1. A contract with Road Builders, Inc. in an amount not to exceed $124,912 for up to two wheel scrapers;
    
2. A contract with Varner Construction in an amount not to exceed $670,404 for up to ten rock trucks;
    
3. A contract with Jagur Tractor in an amount not to exceed $743,988 for up to seven scrapers; and
    
4. A contract with Caufield Equipment in an amount not to exceed $478,000 for up to four scrapers.

3. On-Road Heavy-Duty Diesel Vehicle Replacement Program
   As mentioned in the Background section, the Conceptual FY 2004-05 Work Program included $1.75 million to implement a follow-on element to last year’s successful On-Road Heavy-Duty Diesel Vehicle Replacement Program. The follow-on Program would be expanded to include independent owner/operators within each county and add an outreach component to ensure broad-based participation throughout the basin. The maximum amount allowable for program management, administration and outreach shall not exceed 15% of the MSRC contract. Eligible vehicles include model year 2000 or newer trucks only and vehicles must be equipped with automated vehicle locator systems. The vehicle being replaced will be scrapped in exchange for the newer vehicle. The Program will be administered by the Gateway Cities COG through a sole-source contract award (see sole-source justification for further details).

In some cases the full amount requested in an application or proposal is not recommended for funding or the proposed scope of work has been modified. This is consistent with the MSRC's administrative policies, which allow the MSRC to approve a portion of a proposer’s scope of work and/or funding request. In those cases where the proposed funding level or scope of work has been modified by the MSRC, and the proposer cannot perform the project as approved, the MSRC may rescind the funding commitment and retain the funds in the Discretionary Fund for future work programs.

FY 2005-06

4. RFP for MSRC Technical Advisor Services
   As described in the Background section above, the MSRC retains an independent contractor to provide technical assistance in support of the AB 2766 Discretionary Fund Program. Since the current Technical Advisor contract expires June 30, 2005, and no further options can be exercised, the MSRC unanimously approved issuance of an RFP (attached) to solicit these services for FYs 2005-06 & 2006-07. The final contract will include one 2-year option to be exercised at the MSRC’s discretion, with funding commitments subject to AQMD Board approval. Funding for this technical assistance will be determined based on proposals and associated available funds in the next fiscal year, subject to MSRC and AQMD Board approval at a later date. Proposals are due no later than 2:00 p. m. March 8, 2005.

FY 2001-02 Work Program

5. Contract Modification for Orange County Transportation Authority (OCTA)
   As stated in the Background section, the OCTA was awarded $286,471 towards the purchase of 21 LNG buses in the FY 2001-02 Work Program under the Alternative Fuel Transit Bus Program. No buses have been purchased to date. OCTA subsequently requested that the award be modified to transfer funding to their LNG refueling infrastructure and maintenance facilities. The FY 2001-02 RFP provided up to $100,000 for station installations and expansions and up to $10,000 for facility modifications necessary to accommodate storage and usage of alternative fuel buses. The MSRC concluded that the work OCTA was performing could not be characterized as expanding the stations’ capacity. As a result, at its May 27, 2004 meeting, the MSRC denied the request, but allowed up to $10,000 for facility modifications under the FY 2001-02 contract award.
    
   The MSRC respectfully requests the AQMD Board’s approval of the above contract awards/modifications as part of the FYs 2004-05 and 2001-02 AB 2766 Discretionary Fund Work Programs and release of the RFP for Technical Advisor Services beginning FY 2005-06.
    
   The MSRC requests authority to adjust the funds allocated to each project specified in this Board letter by up to five percent of the project's recommended funding. The Board has granted this authority to the MSRC for all past work programs. Finally, the MSRC requests the Board authorize the AQMD Chairman of the Board the authority to execute all agreements and/or modifications described in this letter as part of FYs 2004-05 and 2001-02 Work Programs.

Resource Impacts

The AQMD acts as fiscal administrator for the AB 2766 Discretionary Fund Program (Health & Safety Code Section 44243). Money received for this program is recorded in a special revenue fund (Fund 23) and the contracts will be drawn from this fund. These contracts will have no fiscal impact on the AQMD’s operational budget.

Attachment

RFP #P2005-21 – For Technical Advisor Services for the MSRC

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