BOARD MEETING DATE: July 13, 2007
AGENDA NO. 13

PROPOSAL:

Approve Contract Modifications and Awards under FYs 2003-04, 2005-06 and 2006-07 Discretionary Fund Work Programs and Fund Transfer for Miscellaneous Costs in FY 2007-08

SYNOPSIS:

 At its June 21, 2007 meeting the MSRC approved two awards for alternative fuel infrastructure projects under the FY 2006-07 Work Program, one Freeway Service Patrol project under the FY 2005-06 Work Program, and four contract modifications under the FYs 2003-04 and 2005-06 Work Programs. Additionally, every year the MSRC adopts an Administrative Budget to ensure that the program’s administrative costs do not exceed its five percent administrative cap provided for in the legislation. For FY 2007-08 the Administrative Budget includes but is not limited to: 1) miscellaneous expenses such as postage, printing, graphics, refreshments, office supplies and equipment, and communications; 2) travel costs; and 3) conference-related expenses. Since expenses cannot be charged directly to special funds, the MSRC proposes to transfer the funds for these expenses to TAO’s budget for FY 2007-08. Expenses will be tracked and any unspent funds returned to the MSRC’s fund at the fiscal year end. The MSRC seeks AQMD Board approval for these contract modifications and awards and the fund transfer. (Review: Mobile Source Air Pollution Reduction Review Committee, June 21, 2007)

COMMITTEE:

Mobile Source Air Pollution Reduction Review, June 21, 2007, Recommended for Approval

RECOMMENDED ACTIONS:

1. Approve a modified contract with Cathedral City in an amount not to exceed $50,000 towards the purchase of up to three medium-duty and one heavy-duty CNG vehicles under the FY 2003-04 AB 2766 Discretionary Fund Work Program, as described in this letter;
2. Approve a modified contract with the County of Orange in an amount not to exceed $440,000 towards the purchase of up to one medium-duty and four heavy-duty CNG vehicles and installation of CNG infrastructure under the FY 2003-04 AB 2766 Discretionary Fund Work Program, as described in this letter;
3. Approve a modified contract with the City of San Fernando in an amount not to exceed $262,042 towards the purchase of up to two medium-duty and three heavy-duty CNG vehicles and installation of CNG infrastructure under the FY 2003-04 AB 2766 Discretionary Fund Work Program, as described in this letter;
4. Approve a modified contract with the City of Rancho Cucamonga in an amount not to exceed $100,000 towards the purchase of up to three natural gas street sweepers and one natural gas heavy-duty truck under the FY 2005-06 AB 2766 Discretionary Fund Work Program, as described in this letter;
5. Approve Freeway Service Patrol project scope for Orange County Transportation Authority as part of its $928,740 sole-source contract under the FY 2005-06 AB 2766 Discretionary Fund Work Program, as described in this letter;
6. Approve two awards under the Alternative Fuel Infrastructure Funding Opportunities Program as part of the FY 2006-07 AB 2766 Discretionary Fund Work Program, as described in this letter, and as follows:
   1. A contract to Rainbow Disposal in an amount not to exceed $350,000 towards construction of a CNG refueling station in Huntington Beach; and
   2. A contract to Clean Energy in an amount not to exceed $350,000 towards construction of an L/CNG refueling station in Long Beach;
7. Transfer $56,900 from the AB 2766 Discretionary Fund, Special Fund 23, to the AQMD General Fund and appropriate $56,900 fro the Undesignated Fund Balance to the Science & Technology Advancement’s FY 2007-08 Budget to facilitate the payment of MSRC Miscellaneous Direct and Travel Costs as provided in Table 1 of this letter;
8. Authorize MSRC the authority to adjust contract awards up to five percent, as necessary; and
9. Authorize the Chairman of the Board to execute new and modified contracts under FYs 2003-04, 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 2003-04 Work Program
The MSRC previously awarded a contract to Cathedral City in a not-to-exceed amount of $50,000 towards the purchase of up to one medium-duty and two heavy-duty CNG vehicles. The City has requested substitution of two medium-duty vehicles for one heavy-duty vehicle. The MSRC considered their request for a modified contract at its June 21, 2007 meeting. Further details are described below in the Proposals section.

The MSRC previously awarded a contract to the County of Orange in a not-to-exceed amount of $440,000 towards the purchase of five heavy-duty natural gas vehicles and installation of CNG infrastructure. The County has requested substitution of one medium-duty vehicle for one heavy-duty vehicle instead. The MSRC considered their request for a modified contract at its June 21, 2007 meeting. Further details are described below in the Proposals section.

The MSRC previously awarded a contract to the City of San Fernando in a not-to-exceed amount of $277,642 towards the purchase of two medium-duty and three heavy-duty CNG vehicles and installation of CNG infrastructure. The contract was executed in the amount of $262,042 based on revised project costs and reduced local contribution. The City has requested a change in the location of the CNG infrastructure. The MSRC considered their request for a modified contract at its June 21, 2007 meeting. Further details are described below in the Proposals section.

FY 2005-06 Work Program
The MSRC previously awarded a contract to the City of Rancho Cucamonga in a not-to-exceed amount of $100,000 towards the purchase of up to two natural gas street sweepers and two natural gas heavy-duty trucks. The City has requested substitution of an additional natural gas street sweeper for a natural gas heavy-duty truck. The MSRC considered their request for a modified contract at its June 21, 2007 meeting. Further details are described below in the Proposals section.

As part of the MSRC’s FY 2005-06 Phase I Work Program, the MSRC allocated $3.95 million to the four county transportation commissions (CTCs) to implement Efficiency Freeway Service Patrol (FSP) Programs. The project categories included implementation of new or expanded FSP beats as well as projects that demonstrate technologies which improve FSP efficiency. Funding was allocated starting with an initial $700,000 per county geographic minimum with the remaining $1.15 million funds distributed using their Tier 1 Statewide FSP formula. The Orange County Transportation Authority (OCTA) was awarded $928,704 on this basis. Since OCTA’s project was different from that of the other three CTCs, which plan to use their funding to implement new or expanded beats, the project scope were submitted to the MSRC at its June 21, 2007 meeting for consideration. Further details are described below in the Proposals section.

FY 2006-07 Work Program
As an element of their FY 2006-07 Phase I AB 2766 Discretionary Fund Work Program, the MSRC allocated $3.5 million for the implementation of an alternative fuel infrastructure program. The Alternative Fuel Infrastructure Funding Opportunities Program Announcement, #PA2007-05, provides funds for new as well as upgraded or expanded alternative fuel stations as well as maintenance facility modifications. New publicly accessible stations are eligible for 50 percent of hardware and installation 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 costs up to a maximum of $150,000; except that “high volume” limited access stations can receive 50 percent of project costs up to a maximum of $350,000. 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 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 6, 2006 through May 25, 2007. At its June 21, 2007 meeting, the MSRC considered two applications under this Program; details are provided in the Proposals section.

FY 2007-08 Work Program
Administrative costs for the AB 2766 Discretionary Program are limited to five percent annually per statute. Every year the MSRC adopts an Administrative Budget for the upcoming fiscal year to ensure costs remain within this limitation. For FY 2007-08, the MSRC adopted an Administrative Budget in the amount of $634,571, which is more than $100,000 below the cap. While the Administrative Budget is adopted annually by the MSRC, expenditures are not directly drawn from the MSRC fund account, but are taken directly from the AQMD’s budget and subsequently reimbursed from the MSRC fund account. More recently, AQMD staff has found that the AQMD Budget may not have sufficient funds to cover the MSRC administrative expenditures in addition to its own expenditures and must reallocate funds to cover any expenditure exceeding the budget. To resolve this concern, AQMD staff proposed the MSRC approve a fund transfer to the AQMD’s budget. The MSRC considered this fund transfer at its June 21, 2007 meeting. Further details are provided in the Proposals section.

Outreach

In accordance with AQMD’s Procurement Policy and Procedure, public notices advertising the Alternative Fuel Infrastructure Funding Opportunities and inviting bids were 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.

Additionally, potential bidders were notified utilizing AQMD’s own electronic listing of certified minority vendors. Notices of the Program Announcement was mailed to the Black and Latino Legislative Caucuses and various minority chambers of commerce and business associations, the State of California Contracts Register website, and placed on the Internet on AQMD’s website (http://www.aqmd.gov where they 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 the AQMD’s standard practices, flyers announcing the Program Announcement was mailed to nearly 1,800 interested parties on the MSRC’s mailing list. The Program Announcement was also placed on the MSRC’s website at http://www.cleantransportationfunding.org.

Bidders’ Conference

A non-mandatory Bidders’ Conference was conducted at AQMD headquarters on October 25, 2006, for the Alternative Fuel Infrastructure Funding Opportunities Program.

Proposal Evaluation and Panel Composition

The MSRC’s Technical Advisory Committee (MSRC-TAC) formed an evaluation subcommittee to review the application 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 June 21, 2007 meeting, the MSRC considered recommendations from its MSRC-TAC and unanimously approved the following:

FY 2003-04 Work Program
As mentioned in the Background section, the MSRC previously awarded a $50,000 contract to Cathedral City towards the purchase of one medium-duty and two heavy-duty CNG vehicles, and the AQMD Board approved this award on June 4, 2004. The City received and placed into service one of the heavy-duty CNG vehicles and ordered the medium-duty CNG vehicle. The second heavy-duty CNG vehicle, which was ordered and placed into service by the City, was unfortunately a used vehicle, and the Program Announcement allowed only new vehicles. Consequently, the City requested the substitution of two medium-duty vehicles for one heavy-duty vehicle. At its June 21, 2007 meeting, the MSRC unanimously approved the modified contract with Cathedral City in an amount not to exceed $50,000 towards the purchase of up to three medium-duty and one heavy-duty CNG vehicles. Since heavy-duty vehicles are eligible for $20,000 each and medium-duty vehicles are eligible for $10,000 each, the contract value will not change. The MSRC requests AQMD Board approval of the modified contract with Cathedral City under the FY 2003-04 Work Program.

As mentioned in the Background section, the MSRC previously awarded a $440,000 contract to County of Orange towards the purchase of five heavy-duty natural gas vehicles and installation of CNG infrastructure, and the AQMD Board approved this award on July 8, 2005. The County mistakenly thought the mobile refueling truck they planned to order was a heavy-duty vehicle, and therefore, the award specified the purchase of five heavy-duty vehicles. In fact, the mobile refueling truck is classified as medium-duty. Consequently, the County requested substitution of one medium-duty natural gas vehicle for one heavy-duty natural gas vehicle instead. At its June 21, 2007 meeting, the MSRC unanimously approved the modified contract with the County of Orange in an amount not to exceed $440,000 towards the purchase of up to one medium-duty and four heavy-duty natural gas vehicles and installation of CNG infrastructure. Since the City received only $10,000 for this heavy-duty vehicle, and medium-duty vehicles are eligible for $10,000 each, the contract value will not change. The MSRC requests AQMD Board approval of the modified contract with County of Orange under the FY 2003-04 Work Program.

The MSRC previously awarded a $277,642 contract to the City of San Fernando towards the purchase of two medium-duty and three heavy-duty CNG vehicles and installation of CNG infrastructure, and the AQMD Board approved this award on June 4, 2004. Based on reduced project costs and local contribution, the final contract was executed in the amount of $262,042. Subsequently, the City has requested a change in the location of the CNG infrastructure. The CNG infrastructure consisted of two stations: a time-fill station and a fast-fill CNG station with public accessibility. The time-fill station was constructed on their city maintenance yard but the fast-fill station hasn’t yet broken ground. The City has decided to sell the property on which their city yard is currently located, and is therefore requesting a modification of their contract to move the stations to another nearby site. They will assume the cost for moving the time-fill station already constructed, and the fast-fill station will actually have more visibility for public access than the current site. At its June 21, 2007 meeting, the MSRC unanimously approved the modified contract with the City of San Fernando in an amount not to exceed $262,042 towards the purchase of up to two medium-duty and three heavy-duty CNG vehicles and installation of CNG infrastructure at the new location. The MSRC requests AQMD Board approval of the modified contract with the City of San Fernando under the FY 2003-04 Work Program.

FY 2005-06 Work Program
As mentioned in the Background section, the MSRC previously awarded a $100,000 contract to the City of Rancho Cucamonga towards the purchase of two natural gas street sweepers and two natural gas heavy-duty trucks, and the AQMD Board approved this award on December 1, 2006. The City has requested substitution of an additional natural gas street sweeper for a natural gas heavy-duty truck. At its June 21, 2007 meeting, the MSRC unanimously approved the modified contract with the City of Rancho Cucamonga in an amount not to exceed $100,000 towards the purchase of up to three natural gas street sweepers and one natural gas medium-duty vehicle. The MSRC requests AQMD Board approval of the modified contract with the City of Rancho Cucamonga under the FY 2005-06 Work Program.

As mentioned in the Background section, as part of the MSRC’s FY 2005-06 Phase I Work Program, the MSRC awarded a sole-source contract in the amount of $928,704 to OCTA to implement Efficiency Freeway Service Patrol (FSP) Programs. The AQMD Board approved this sole-source contract on September 9, 2005. Since OCTA’s project scope differed significantly from that of the other three CTCs, which plan to use their funding to implement new and/or expanded beats, it was decided the MSRC should take formal action to approve it. Specifically, OCTA proposes to use their funding to install automated vehicle locator and mobile data terminal (AVL/DMT) systems in their entire FSP fleet. The system’s purpose is to increase efficiency, providing faster FSP response times to accident scenes and inoperable vehicles. Increased efficiency would in turn reduce vehicle emissions by reducing traffic congestion and idling time. Since the program allowed projects that demonstrate technologies which improve FSP efficiency, the MSRC unanimously approved the FSP project proposed by OCTA at its June 21, 2007 meeting. Although the AQMD Board previously approved the sole-source award to OCTA, the MSRC seeks AQMD Board approval of the project scope at this time.

As mentioned in the Background section, the MSRC allocated $3.5 million for the implementation of an alternative fuel infrastructure program. Eligible projects included new as well as upgraded or expanded alternative refueling stations as well as maintenance facility modifications. New publicly accessible stations are eligible for 50 percent of hardware and installation costs up to a maximum of $250,000 to $350,000 depending upon station type. At its June 21, 2007 meeting, the MSRC unanimously approved two awards under the FY 2006-07 Work Program, as follows:

1. A contract to Rainbow Disposal in an amount not to exceed $350,000 towards construction of a CNG refueling station in Huntington Beach; and
2. A contract to Clean Energy in an amount not to exceed $350,000 towards construction of an L/CNG refueling station in Long Beach.

The Alternative Fuel Infrastructure Funding Opportunities Program Announcement #PA2007-05 closed on May 25, 2007. Additional applications received by the end date are being considered by the MSRC’s Technical Advisory Committee and will be brought forward in the near future.

FY 2007-08 Work Program
As mentioned in the Background section, every year the MSRC adopts an Administrative Budget for the upcoming fiscal year to ensure costs remain within the five percent legislative cap for administrative expenses. For FY 2007-08, the MSRC adopted an Administrative Budget in the amount of $634,571. While the Administrative Budget is adopted annually by the MSRC, expenditures are not directly drawn from the MSRC fund account, but are taken directly from the AQMD’s budget and subsequently reimbursed from the MSRC fund account. At its June 21, 2007 meeting, the MSRC unanimously approved a fund transfer of $56,900 to the AQMD Science & Technology Advancement FY 2007-08 Budget to facilitate the payment of MSRC Miscellaneous Direct and Travel Costs included in the MSRC’s FY 2007-08 Administrative Budget as shown in Table 1. Staff will track expenses throughout the year, report to the MSRC on a quarterly basis, and any unused monies will be transferred back to the MSRC’s discretionary fund account (Fund 23) at the end of the fiscal year. The MSRC requests AQMD Board approval of this fund transfer of $56,900 for FY 2007-08 as provided in Table 1.

Table 1. Estimated FY 2007-08 MSRC Miscellaneous and Direct Expenditures Proposed to be Allocated to AQMD Science and Technology Advancement FY 2007-08 Budget

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 the agreements described in this letter under the FYs 2003-04, 2005-06, and 2006-07 AB 2766 Discretionary Fund Work Programs and authorize a fund transfer of $56,900 from Fund 23 to Science & Technology Advancement’s Budget.

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

None