BOARD MEETING DATE: September 8, 2006
AGENDA NO. 18

Approve Contracts and Contract Options and Allocate Funding for CNG School Buses Under FYs 2002-03, 2005-06 and 2006-07 AB 2766 Discretionary Fund Work Programs

SYNOPSIS:

As part of the FY 2002-03 Work Program, the MSRC approved a $24,895 award to Cathedral City for wind fencing. The contract expired before execution of the extension modification; thus, the MSRC requests Board approval to award a new/replacement contract. As part of FY 2005-06 Work Program, the MSRC approved $2.5 million for alternative fuel infrastructure; eight awards totaling $1,733,981 were already approved. The MSRC requests approval of seven new projects totaling $1,043,750, which uses the remaining allocation plus $277,731 from unencumbered carryover funds. The MSRC also allocated $2 million for CNG school bus incentives and requests the Board approve $420,000 and $110,000 contract increases for BusWest and A-Z Bus Sales, respectively. Finally, as part of FY 2006-07 Work Program, the MSRC requests approval of $2 million for school bus incentives for private providers and $50,930 to exercise the FY 2006-07 option for programmatic outreach with Better World Group. The MSRC further requests authority to adjust contracts up to five percent and for the Board Chairman to execute agreements. 

COMMITTEE:

Mobile Source Air Pollution Reduction Review, August 17, 2006

RECOMMENDED ACTIONS:

1. Approve a new/replacement contract with Cathedral City in an amount not to exceed $24,895 for wind fencing projects under FY 2002-03 AB 2766 Discretionary Fund Work Program, as described in this letter;
2. Approve the award of seven contracts totaling $1,043,750 ($766,019 from the remaining allocation for this Program and $277,731 from unencumbered carryover funds) for the Alternative Fuel Infrastructure Funding Opportunities Program under Phase I of FY 2005-06 AB 2766 Discretionary Fund Work Program, as described in this letter and as follows:
   1. A contract with Orange County Transportation Authority in an amount not to exceed $200,000 for a limited access CNG refueling station and maintenance facility modifications at their Santa Ana Bus Base ;
   2. A contract with City of Long Beach, Department of Public Works, in an amount not to exceed $250,000 for a publicly accessible LNG refueling station at their Public Works facility;
   3. A contract with Hemet Unified School District in an amount not to exceed $125,000 for a limited access CNG refueling station;
   4. A contract with Newport-Mesa Unified School District in an amount not to exceed $50,000 for a limited access CNG refueling station;
   5. A contract with Clean Energy in an amount not to exceed $250,000 for a publicly accessible CNG refueling station at the Long Beach Police Department;
   6. A contract with Rossmoor Pastries in an amount not to exceed $18,750 to partially offset costs of a limited access CNG refueling station at their Signal Hill facility; and
   7. A contract with Menifee Unified School District in an amount not to exceed $150,000 for a limited access CNG refueling station.
3. Approve augmentation of two awards for the CNG School Bus Incentive Program under Phase II of FY 2005‑ 06 Work Program, as described in this letter and as follows:
   1. Augmentation of contract with BusWest in an amount not to exceed $420,000; and
   2. Augmentation of contract with A-Z Bus Sales in an amount not to exceed $110,000.
4. Approve and allocate $2 million for CNG school bus incentives for private pupil transportation providers under FY 2006-07 Work Program as described in this letter;
5. Exercise the third/final option clause to extend the contract (or issue a new contract in the event the modification is not executed before the current term expires) with The Better World Group for FY 2006-07 outreach coordinator services in an amount not to exceed $50,930 under FY 2006-07 Work Program, as described in this letter;
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 new and modified contracts under FYs 2002-03, 2005-06 and 2006-07 AB 2766 Discretionary Fund Work Programs, as described above and within this letter.

Gwenn Norton-Perry
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.  

FY 2002-03 Work Program

The MSRC previously awarded a contract to Cathedral City in the amount of $24,895 for installation of wind fencing under the FY 2002-03 Work Program. In June 2006 the City requested a contract term extension which was approved by the MSRC. The contract, No. MS03032, expired before the extension could be executed. No payments had been made under the contract at the time it expired. The MSRC considered a new/replacement contract at its August 17, 2006 meeting. Further details are described below in the Proposals section.

FY 2005-06 Work Program

The FY 2005‑ 06 Work Program, implemented in two phases, included $2.5 million for an Alternative Fuel Infrastructure Funding Opportunities Program and $4.0 million for the CNG School Bus Incentives Program.

The Alternative Fuel Infrastructure Funding Opportunities Program Announcement (PA), #2006-07, provides funds for new and upgraded or expanded alternative fuel stations as well as facility modifications. New publicly accessible stations are eligible for 50 percent of project costs up to a maximum of $250,000 to $350,000 depending upon station type. New limited access stations are eligible for 25 percent of project costs up to a maximum of $150,000.  Upgrades/expansions are eligible for 50 percent of costs up to $150,000 for public access and 25 percent up to $75,000 for limited access.  Maintenance facility modifications are eligible for 50 percent of project costs up to $50,000.  The MSRC's award combined with any AQMD cost-sharing may not exceed 50 percent of the total project costs.  The maximum funding for any one entity cannot exceed 60 percent of the total funding in this work program category.  The extended application period for the Alternative Fuel Infrastructure Funding Opportunities Program is October 4, 2005 through June 30, 2006.  The MSRC and AQMD Board previously approved eight applications totaling $1,733,981 under this Program. By the June 30, 2006 closing date of the PA, 13 new applications had been received and were considered by the MSRC at its August 17, 2006 meeting; details are provided in the Proposals section.

The MSRC allocated $2 million in Phase I and $2 million in Phase II for the CNG School Bus Incentives Program. Phase I funds were fully expended and only $580,000 remains in Phase II funds. The incentives are implemented through contracts with A‑ Z Bus Sales, California Bus Sales, and BusWest, which were vendors previously qualified under a Request for Quotes when the MSRC initially implemented the program. The MSRC considered requests by two vendors for additional funds under this Program at its August 17, 2006 meeting. Further details are described below in the Proposals section.

FY 2006-07 Work Program

In the last few months the MSRC has been brainstorming with its Technical Advisory Committee (MSRC-TAC) to develop its FY 2006-07 Work Program. At its August 17, 2006 meeting, the MSRC conceptually approved funding categories for a two-phase, $12.7 million FY 2006-07 Work Program. The MSRC specifically approved two elements for funding under the FY 2006-07 Work Program and at this time they seek AQMD Board approval of these awards. Further details are described below in the Proposals section.

Outreach

For the Alternative Fuel Infrastructure Funding Opportunities Program Announcement described above, in accordance with AQMD's Procurement Policy and Procedure, a public notice advertising the Program Announcement and inviting bids was published in the Los Angeles Times, the Orange County Register, the San Bernardino Sun, and Riverside County Press Enterprise newspapers to leverage the most cost-effective method of outreach to the entire South Coast Basin.

The funding solicitation was placed on the internet on the MSRC's website at http://www.msrc-cleanair.org and on AQMD's website (http://www.aqmd.gov/ where it can 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 the AQMD's bidder’s 24-hour telephone message line (909)  396‑ 2724. A press release on funding opportunities available in the FY 2005-06 Work Program was issued and placed on the MSRC's website.

In addition to the AQMD's standard practices, a postcard announcing the FY 2005-06 funding opportunities was mailed to nearly 1,800 interested parties on the MSRC's mailing list, as well as to the Black and Latino Legislative Caucuses and various chambers of commerce and business associations. Notice was also mailed to local legislators, mayors, city council members and city managers in the four counties.

Bidders' Conferences

A non-mandatory Bidders' Conference was conducted on September 28, 2005 at AQMD headquarters for the Alternative Fuel Infrastructure Funding Opportunities Program. 

Proposal Evaluation and Panel Composition

The MSRC's Technical Advisory Committee formed an evaluation subcommittee to review the applications received to determine eligibility, using the criteria within the Alternative Fuel Infrastructure Funding Opportunities Program Announcement. The MSRC-TAC is a diverse group of individuals appointed by participating members as prescribed in the Health & Safety Code.

Proposals

At its August 17, 2006 meeting, the MSRC considered several recommendations from its MSRC-TAC and unanimously approved the following:

FY 2002-03 Work Program

As stated in the Background section, the MSRC previously awarded a contract to Cathedral City in the amount of $24,895 for installation of wind fencing. The contract died before an extension could be modified. At its August 17, 2006 meeting, the MSRC unanimously approved a new/replacement contract with Cathedral City in an amount not to exceed $24,895 to conduct the work originally intended under Contract #MS03032. The contract term would be 11 months. At this time the MSRC requests AQMD Board approval of this new/replacement contract with Cathedral City.

FY 2005-06 Work Program

As mentioned in the Background section, the MSRC set aside $2.5 million as part of Phase I of its FY 2005‑ 06 Work Program to provide funds for new and upgraded or expanded alternative fuel stations as well as maintenance facility modifications.  The MSRC and AQMD Board previously approved eight applications totaling $1,733,981 under this Program. By the June 30, 2006 closing date of the PA, 13 new applications had been received requesting funding over $2.6 million. At its August 17, 2006 meeting, the MSRC considered recommendations from its MSRC-TAC and approved seven new contract awards totaling $1,043,750. Since only $766,019 remained from the original allocation for this Program, the MSRC approved an additional $277,731 from unencumbered carryover funds to fund all eligible projects recommended by its MSRC-TAC. At this time the MSRC requests AQMD Board approval of the following seven new contracts:

1. A contract with Orange County Transportation Authority in an amount not to exceed $200,000 for a limited access CNG refueling station and maintenance facility modifications at their Santa Ana Bus Base ;
2. A contract with City of Long Beach, Department of Public Works, in an amount not to exceed $250,000 for a publicly accessible LNG refueling station at their Public Works facility;
3. A contract with Hemet Unified School District in an amount not to exceed $125,000 for a limited access CNG refueling station;
4. A contract with Newport-Mesa Unified School District in an amount not to exceed $50,000 for a limited access CNG refueling station;
5. A contract with Clean Energy in an amount not to exceed $250,000 for a publicly accessible CNG refueling station at the Long Beach Police Department;
6. A contract with Rossmoor Pastries in an amount not to exceed $18,750 to partially offset costs of a limited access CNG refueling station at their Signal Hill facility; and
7. A contract with Menifee Unified School District in an amount not to exceed $150,000 for a limited access CNG refueling station.

Also, as mentioned in the Background Section, two of the three qualified school bus vendors requested additional funds under the CNG School Bus Incentives Program. The AQMD Board has previously authorized the MSRC to augment vendors' contracts based on sales performance. Through orders both in process and fulfilled, A-Z Bus Sales expended all $1,275,000 of its existing contract value and BusWest all $1,680,000 of its existing contract value. Subsequently both vendors received additional orders, which were considered by the MSRC on a first-come, first-serve basis. A-Z Bus Sales received an order from Certified Transportation for one full-size bus, which would be eligible for a $60,000 incentive, and an order from Menifee Unified School District for two smaller buses, which would be eligible for $25,000 per bus incentives. At its August 17, 2006 meeting, the MSRC unanimously approved a contract augmentation in the amount of $110,000 to A-Z Bus Sales. BusWest received an order from Student Transportation of America for 23 full‑ sized CNG school buses. At $60,000 per bus, $1,380,000 would be needed to provide the full buydown incentive for this order. At its August 17, 2006 meeting, the MSRC awarded $420,000 to BusWest for seven additional buses at a $60,000 per bus incentive. The remaining $50,000 in Phase II of the Program was not allocated. Since the MSRC’s FY 2006-07 Work Program would be including a funding category for CNG school buses and there were insufficient funds available from the FY 2005-06 Program to fulfill the request, the MSRC disallowed the remaining funds requested. At this time the MSRC requests AQMD approval of an $110,000 contract augmentation to A-Z Bus Sales and a $420,000 contract augmentation to BusWest.

FY 2006-07 Work Program

As mentioned in the Background section, at its August 17, 2006 meeting, the MSRC specifically approved two elements for funding under the FY 2006-07 Work Program. For its FY 2006-07 Work Program, the MSRC decided to offer CNG school bus incentives to both public school districts and private pupil transportation providers. Although the MSRC is currently re-evaluating how incentives will be offered to public school districts, at its August 17, 2006 meeting, the MSRC approved an allocation of $2 million for CNG school bus incentives for private pupil transportation providers. A private pupil transportation provider will apply for incentives, execute participant agreements, and the MSRC will fund incentives up to the amount necessary to ensure compliance with Rule 1195. This will help ensure fewer diesel school buses are put on the roads due to lack of incentive funding because the incentive will go directly to the private pupil transportation provider. At this time the MSRC requests Board approval of this Program and the direct incentives, and authorization to allocate $2 million for CNG school bus incentives for private pupil transportation providers.

The second element approved by the MSRC for funding under the FY 2006-07 Work Program is a contract option. The MSRC retains The Better World Group to provide programmatic outreach services. Their contract included three options to extend. The first two options have been exercised. At its August 17, 2006 meeting, the MSRC unanimously approved exercising the third and final option and added $50,930 to fund services for FY 2006-07. At this time the MSRC requests Board approval to exercise The Better World Group option in the amount of $50,930 under the FY 2006-07 Work Program.

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.

The MSRC respectfully requests the AQMD Board's approval of the above contract awards, contract options, and funding allocations under FYs 2002-03, 2005-06 and 2006-07 Work Programs. The MSRC also 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 described in this letter.

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.