BOARD MEETING DATE: July 13, 2007
AGENDA NO. 4

RECOMMENDED ACTIONS:

1. Authorize the Chairman to recognize $5,506,464 from CARB under the “Year 9” Carl Moyer Multi-District Program and place the funds in the Carl Moyer Program Fund SB1107 Account.
2. Authorize the Chairman to execute the following contracts under the Carl Moyer Multi-District program from the Carl Moyer Program Fund SB1107 Account:
   1. A contract with J.D. Edwards Company to repower and retrofit front and rear engines on eight construction equipment in an amount not to exceed $2,047,712.
   2. A contract with Fidel Gonzalez to retrofit one construction equipment engine in an amount not to exceed $24,893.
   3. A contract with Sukut Equipment, Inc. to repower and retrofit front and rear engines on four construction equipment in an amount not to exceed $869,618.
   4. A contract with Peed Equipment to repower and retrofit front and rear engines on six construction equipment in an amount not to exceed $1,934,922.
   5. A contract with Miller Equipment to retrofit one construction equipment engine, and repower and retrofit four construction equipment engines in an amount not to exceed $367,107.

3. Authorize the Chairman to execute the following construction equipment contracts for the FY 2006-07, “Year 9” Carl Moyer Program from the Carl Moyer Program Fund SB 1107 Account:
   1. A contract with Tamco Steel to repower and retrofit two loaders, one excavator and one haul truck in an amount not to exceed $339,941.
   2. A contract with L.D. Anderson, Inc. to repower and retrofit four scrapers, two dual-engine scrapers and one dual-engine water pull in an amount not to exceed $1,635,950.
   3. A contract with L.R. Johnson to retrofit two scrapers, one grader, two dozers and two loaders in an amount not to exceed $297,937.
   4. A contract with Douglas Cash Heavy Equipment Rental to repower and retrofit four scrapers in an amount not to exceed $600,141.
   5. A contract with Cash Grading to repower and retrofit four dual-engine scrapers in an amount not to exceed $961,112.
   6. A contract with Varner Construction to repower one scraper in an amount not to exceed $100,323.
   7. A contract with Herigstad Equipment Rental, Inc. to repower two dual-engine scrapers in an amount not to exceed $361,902.
   8. A contract with City of Burbank to retrofit one tractor in an amount not to exceed $18,608.
   9. A contract with Larry Jacinto Construction to retrofit one dual-engine scraper in an amount not to exceed $65,382.
   10. A contract with Coburn Equipment, Inc. to repower and retrofit two tractors and one dual engine water pull in an amount not to exceed $544,473.
   11. A contract with Connoly-Pacific Company to retrofit two loaders in an amount not to exceed $25,554.
   12. A contract with Dalton Trucking to repower and retrofit two pipe loader in an amount not to exceed $125,083.
   13. A contract with Post Grading to retrofit one grader and one dozer in an amount not to exceed $28,538.
   14. A contract with McLaughlin Enginerring and Mining, Inc. to retrofit two dozers and one loader in an amount not to exceed $104,823.
   15. A contract with Road Builders, Inc. to repower four scrapers in an amount not to exceed $515,353.
   16. A contract with T&W Parks Construction to retrofit one dozer in an amount not to exceed $48,805.
   17. A contract with Sukut Equipment to repower and retrofit eleven dozers and five dual-engine scrapers in an amount not to exceed $2,364,000.
   18. A contract with JKM Equipment, Inc. to repower and retrofit one dual-engine scraper in an amount not to exceed $314,064.
   19. A contract with Cobra Equipment to repower and retrofit five dual-engine scrapers in an amount not to exceed $1,563,375.
   20. A contract with Camel Equipment to repower and retrofit one grader and to retrofit two dozers in an amount not to exceed $146,945.
   21. A contract with Swiss Construction to retrofit three scrapers, one dozer, and one loader in an amount not to exceed $364,570.
   22. A contract with Don Hays to retrofit two water trucks in an amount not to exceed $33,888.
   23. A contract with Dennis McCoy to repower and retrofit three dual engine scraper in an amount not to exceed $1,151,925.
   24. A contract with Jagar Tractor to repower and retrofit one dual engine scraper in an amount not to exceed $270,443.

4. Authorize the Chairman to execute a contract with TNT Grading to repower five scrapers, two water pulls, and six dozers in an amount not to exceed $1,231,481 from the Clean Fuels Fund to be used as backup for Carl Moyer Program projects.

5. Transfer $729,300 in Clean Fuels funded projects approved in January 2007, as listed in Table 2, to the Carl Moyer Fund utilizing Carl Moyer Program turn-back funds as listed in Table 3.

Barry R. Wallerstein, D.Env.
Executive Officer

Background

This is the ninth year of the CMP and is the third year of the program with a long-term source of funding generated under SB 1107 and AB 923. At its February 2, 2007 meeting, the Board approved the release of Program Announcement #PA2007-08 to solicit proposals for “Year 9” of the Carl Moyer Program for approximately $25.5 million. By the closing date of May 4, 2007, a total of 133 proposals were submitted requesting approximately $88.3 million in funding. In the category of construction equipment, a total of 72 proposals were submitted requesting approximately $50 million in funding. In addition, on June 11, 2007, CARB allocated $5,506,464 to the AQMD under the Carl Moyer Multi-District Program for construction equipment projects.

Proposal

Staff proposes to execute construction equipment contracts prior to July 26, 2007, when CARB is scheduled to seek CARB Board approval for the In-Use Off-Road regulation. Adoption of this regulation will severely limit the use of Carl Moyer Program funding for construction equipment projects thereafter.

This action is to recognize $5,506,464 from CARB for “Year 9” Carl Moyer multidistrict projects and place the funds in the Carl Moyer Program Fund SB1107 Account, and execute construction equipment contracts selected and approved by CARB in an amount not to exceed $5,244,252. In addition, CARB has allocated $262,212 from the total funding for administrative costs of these projects.

This action is also to approve construction equipment projects under the Carl Moyer Program with $11,983,135 million from the “Year 9” Carl Moyer Program Fund SB 1107 Account, and $1,231,481 million Clean Fuels Program Fund as a backup project. The backup project with Clean Fuels Funds will be used to expeditiously replace other projects that fall through due to unforeseen reasons and result in returned funds. Staff proposes to seek Board approval for the remaining balance of the Carl Moyer funds in the near future. All the cost-effectiveness calculations are done according to CARB’s Carl Moyer Program guidelines released on January 6, 2006.

Total NOx and PM reductions from the recommended projects are approximately 634 tons/year and 20.5 tons/year, respectively.

Table 1 summarizes staff’s recommendation for awards in disproportionately impacted areas under the requirements of AB 1390. The total amount of projects funded in disproportionately impacted areas is $8,590,313. The total amount of projects funded solely based on cost-effectiveness is $4,625,303.

Approximately 66% of the award dollars are recommended for projects under the Environmental Justice category in disproportionately impacted (DI) areas as shown in Table 1. In the evaluation process, staff recommended cost-effective proposals in the DI areas first with 50% of the available funding based on their ranking as described below. The remaining qualified DI proposals with all other qualified proposals were then recommended for funding based on cost effectiveness only.

Disproportionate Impact (DI) Point Ranking

The requirements of AB 1390 are implemented according to the following criteria.

1. All projects must qualify for the Carl Moyer program by meeting the cost effectiveness limits established in the RFP.

2. All projects were evaluated according to the following criteria to qualify for funding under DI requirements:

1. Poverty Level: All projects in areas where at least 10% of the population falls below the Federal poverty level based on the year 2000 census data, are eligible to be included in this category, and
    
2. PM Exposure: All projects in areas with the highest 15% of PM concentration will be eligible to be ranked in this category. The highest 15% of PM concentration level is 46 micrograms per cubic meter and above, on an annual average, or
    
3. Air Toxics Exposure: All projects in areas with a cancer risk of 1,000 in a million and above (based on MATES II estimates) will be eligible to be ranked in this category.

The maximum score is comprised of 40 percent for poverty level, and 30 percent each for PM and toxic exposures. Special circumstances exist in some areas, such as the Ports of Long Beach and Los Angeles. Since there are no residents within the ports, poverty ranking could not be established. In this case, the poverty ranking from the adjacent on-shore areas were extended to the port since these populated areas are directly impacted by port activities.

Table 1: Award Recommendations and Proposed Funding Distribution

Currently, there is a sum of $729,300 in Carl Moyer turn-back funds, which would be used to pay for the projects funded in January with Clean Fuels funds. In turn the Clean Fuels Fund will be used again to fund new construction projects. Table 2 provides a list of Clean Fuels backup projects that will be transferred to the Carl Moyer fund, and Table 3 provides a detailed account of the Carl Moyer Program returned funds.

Table 2. Clean Fuels Projects to Be Transferred to the Carl Moyer Fund

Table 3. Detailed List of Carl Moyer Returned Funds

All the above projects were partially completed.

Outreach

In accordance with AQMD’s Procurement Policy and Procedure, a public notice advertising the RFP/RFQ 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 Air Basin. In addition, eight public workshops were conducted in the South Coast Air Basin.

Additionally, potential bidders may have been notified utilizing AQMD’s own electronic listing of certified minority vendors. Notice of the RFP/RFQ 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 at AQMD’s Web site (http://www.aqmd.gov). Information was also available on AQMD’s bidder’s 24-hour telephone message line (909) 396-2724.

Benefits to AQMD

AQMD’s Clean Fuels Program has been active in funding the development and demonstration of low emission, alternative fuel technologies within its Technology Advancement Office. The AQMD has also supported a number of activities directed to commercialization of low-emission alternative fuel technologies. The successful implementation of the Carl Moyer Program is a direct result of these technology advancement activities. The vehicles and equipment funded under this RFP will operate many years and will provide long-term emissions reductions.

Resource Impacts

Funding for “Year 9” of the Carl Moyer Program projects shall not exceed $18,458,868 comprised of:

$11,983,135 Carl Moyer Program Fund SB 1107 Account
$5,244,252 Carl Moyer Program Fund SB 1007 Account (multidistrict projects)
$1,231,481 Clean Fuels Fund (Carl Moyer project as backup)

There are sufficient funds in the Carl Moyer Program Fund.

Sufficient funds are also available from the Clean Fuels Program Fund, established as a special revenue fund resulting from the state-mandated Clean Fuels Program. The Clean Fuels Program, under Health and Safety Code Sections 40448.5 and 40512 and Vehicle Code Section 9250.11, establishes mechanisms to collect revenues from mobile sources to support projects to increase the utilization of clean fuels, including the development of the necessary advanced enabling technologies. Funds collected from motor vehicles are restricted, by statute, to be used for projects and program activities related to mobile sources that support the objectives of the Clean Fuels Program.