BOARD MEETING DATE: May 4, 2007
AGENDA NO. 11

PROPOSAL:

Approve Contract Awards or Modifications; Exercise Option for Technical Advisor Services under FYs 2003-04, 2005-06, 2006-07, 2007-08 and 2008-09 AB 2766 Discretionary Fund Work Programs; and Modify one (1) Program Announcement Under FY 2006-07 Discretionary Fund Work Program

SYNOPSIS:

At its April 19, 2007 meeting the MSRC authorized issuance of a replacement or new contract to complete work initiated by City of Desert Hot Springs under the FY 2003-04 Work Program and approved correction of a FY 2005-06 Work Program award to County of Los Angeles, Department of Public Works, to adjust the vehicle types from natural gas to liquefied petroleum gas. The MSRC also awarded a new contract for an alternative fuel infrastructure project and a contract modification to offer additional CNG school bus incentives and approved issuance of an addendum to an open Program Announcement released under its FY 2006-07 Work Program. Finally, the MSRC exercised a contract option clause to continue technical advisor services under the FY 2007-08 and 2008-09 Work Programs and augmented funding to carry out the work. The MSRC seeks AQMD Board approval for these actions under the FYs 2003-04, 2005-06, 2006-07, 2007-08 and 2008-09 AB 2766 Discretionary Fund Work Programs.

COMMITTEE:

Mobile Source Air Pollution Reduction Review, April 19, 2007, Recommended for Approval

RECOMMENDED ACTIONS:

  1. Approve a new/replacement contract with the City of Desert Hot Springs in an amount not to exceed $20,000 to reimburse for work initiated under Contract #ML04046 under the FY 2003-04 AB 2766 Discretionary Fund Work Program, as described in this letter;
  2. Approve a corrected award to issue a contract to the County of Los Angeles, Department of Public Works in an amount not to exceed $175,000 for up to seven liquefied petroleum gas (LPG) heavy-duty trucks instead of up to seven natural gas heavy-duty trucks, as listed in Agenda Item #11 on the December 1, 2006 AQMD Board agenda (Recommended Action 2.3), as described in this letter;
  3. Approve the award of a contract with the City of Los Angeles in an amount not to exceed $50,000 under the Alternative Fuel Infrastructure Funding Opportunities Program for modifications to their North Central Maintenance Facility to accommodate repair and maintenance of alternative fuel vehicles, as part of Phase I of the FY 2006-07 AB 2766 Discretionary Fund Work Program, as described in this letter;
  4. Approve an augmentation of an award in an amount not to exceed $100,000 to A-Z Bus Sales under the CNG School Bus Incentives Program, as part of Phase I of the FY 2006-07 AB 2766 Discretionary Fund Work Program, as described in this letter;
  5. Approve the issuance of an Addendum to the currently open Local Government Match Program Announcement (#PA2007-09), released on February 2, 2007 as part of Phase II of the FY 2006-07 AB 2766 Discretionary Fund Work Program, as described in this letter;
  6. Exercise the option clause to extend Contract #MS05071 with Raymond Gorski until June 30, 2009, for technical advisor services in an amount not to exceed $316,646.40, as described in this letter, and funded as follows:
    1. For the first year of the option term, 75 percent (or $118,742.40) will be covered in the FY 2007-08 AB 2766 Discretionary Fund Work Program and the balance (25 percent or $39,580.80) will be covered by the MSRC’s administrative budget for FY 2007-08; and
    2. For the second year of the option term, 75 percent (or $118,742.40) will be covered in the FY 2008-09 AB 2766 Discretionary Fund Work Program and the balance (25 percent or $39,580.80) will be covered by the MSRC’s administrative budget for FY 2008-09;
  7. Authorize MSRC the authority to adjust contract awards up to five percent, as necessary; and
  8. Authorize the Chairman of the Board to execute new and modified contracts under FYs 2003-04, 2005-06, 2006-07, 2007-08 and 2008-09 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 the City of Desert Hot Springs in the amount of $40,000 for purchase of two medium-duty CNG vehicles and installation of a slow-fill CNG station. While station installation was essentially complete during the contract term, the station was not operational prior to contract expiration. No payments had been made under the contract at the time it expired. The MSRC considered a new/replacement contract at its April 19, 2007 meeting. Further details are described below in the Proposals section.

FY 2005-06 Work Program
On December 1, 2006, the AQMD Board approved multiple awards as part of the MSRC’s FY 2005-06 Work Program. Subsequent to the approval, staff discovered that one project had been inaccurately described to both the MSRC and AQMD. Details are provided in the Proposals section.

FY 2006-07 Work Program
As an element of Phase I of their FY 2006-07 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 April 19, 2007 meeting, the MSRC considered an application under this Program; details are provided in the Proposals section.

The MSRC also allocated $1 million for CNG school bus incentives for public school districts as part of Phase I of their FY 2006-07 AB 2766 Discretionary Fund Work Program. The MSRC approved awards of $500,000 each to A-Z Bus Sales and BusWest. These two vendors were previously qualified in response to the MSRC’s Request for Vendor Qualifications in FY 2002-03. As in previous years, school districts are able to purchase CNG buses from the MSRC’s qualified vendors at a discount of $60,000 per bus. At its April 19, 2007 meeting, the MSRC considered a request from A-Z Bus Sales for an additional $100,000 to fulfill a new purchase order; details are provided in the Proposals section.

As part of Phase II of the MSRC’s FY 2006-07 AB 2766 Discretionary Fund Work Program, on February 2, 2007 the AQMD Board approved Program Announcement #PA2007-09: Local Government Match Program. Eligible categories include providing a dollar-for-dollar match for heavy-duty alternative fuel vehicles and alternative fuel infrastructure, as well as a new category to fund street sweeping operations using low-emission alternative fuel street sweepers in jurisdictions that sweep streets as a documented PM10 control strategy. The Program Announcement includes an open application period commencing March 13, 2007 and closing June 29, 2007. Subsequent to the release of the Program Announcement, however, it was discovered that the specific language relative to heavy-duty vehicle minimum qualifications is incomplete. At its April 19, 2007 meeting, the MSRC considered an Addendum to the Program Announcement; details are provided in the Proposals section.

FYs 2007-08 and 2008-09 Work Programs
The MSRC retains an independent contractor to provide technical assistance in support of the AB 2766 Discretionary Fund Program. The MSRC approved an RFP for these services which was released coincident with AQMD Board approval on February 4, 2005. At its April 28, 2005 meeting, the MSRC unanimously awarded the contract to Raymond Gorski, including an option for another two-year term to be executed at the MSRC’s discretion, subject to funding approval by the AQMD Board. The current contract with Mr. Gorski will expire on June 30, 2007. At its April 19, 2007 meeting, the MSRC undertook to review Mr. Gorski’s performance and considered exercising the one-time, two-year option as part of the FYs 2007-08 and 2008-09 Work Programs; 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 Local Government Match Program Announcements 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 Announcements were 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 Announcements were mailed to nearly 1,800 interested parties on the MSRC’s mailing list. Notice of the Local Government Match Program Announcement was also mailed to local mayors, city managers and public works directors. The Program Announcements were also placed on the MSRC’s website at http://www.cleantransportationfunding.org.

Bidders’ Conference

Non-mandatory Bidders’ Conferences were conducted at AQMD headquarters, as follows: on October 25, 2006 for the Alternative Fuel Infrastructure Funding Opportunities Program, and on February 27, 2007 for the Local Government Match 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. At its April 19, 2007 meeting, the MSRC considered the MSRC-TAC’s recommendations.

Proposals

At its April 19, 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 contract to the City of Desert Hot Springs in the amount of $40,000 for purchase of two medium-duty CNG vehicles and installation of a slow-fill CNG station. The City subsequently decided not to pursue the vehicle purchases. While the CNG station was installed, it was not operational prior to contract expiration. The MSRC approved a new/replacement contract with the City of Desert Hot Springs in an amount not to exceed $20,000 to reimburse for work initiated under Contract #ML04046. The contract term would be six months. At this time the MSRC requests AQMD Board approval of this new/replacement contract with the City of Desert Hot Springs.

FY 2005-06 Work Program
As mentioned in the Background section, on December 1, 2006, the AQMD Board approved multiple awards as part of the MSRC’s FY 2005-06 Work Program. Among these, the County of Los Angeles, Department of Public Works was awarded $175,000 for the purchase of up to seven heavy-duty natural gas trucks. Subsequent to the approval, staff discovered that this project had been inaccurately described to both the MSRC and AQMD. The recipient and award amount were correct, but the project should have been described as the purchase of LPG trucks. The MSRC approved, and at this time requests AQMD Board approval, of the corrected award.

FY 2006-07 Work Program

  1. Alternative Fuel Infrastructure Funding Opportunities Program
    As mentioned in the Background section, the MSRC set aside $3.5 million as part of Phase I of its FY 2006-07 Work Program to provide funds for new and upgraded or expanded alternative fuel stations as well as maintenance facility modifications. The MSRC approved an award to the City of Los Angeles in an amount not to exceed $50,000 for modifications to their North Central Maintenance Facility to accommodate repair and maintenance of alternative fuel vehicles. At this time the MSRC requests AQMD Board approval of this award to the City of Los Angeles.

This Program Announcement remains open until May 25, 2007. Since this Program was allocated $3.5 million, funding remains available under this Program. Thus, future awards are anticipated, and will be subject to MSRC and AQMD Board approval as part of the FY 2006-07 Work Program.

  1. CNG School Bus Incentives Program
    As mentioned in the Background section, A-Z Bus Sales requested additional funding under the CNG School Bus Incentives Program. The MSRC allocated $1 million to continue this Program for public school districts as part of Phase I of its FY 2006-07 Work Program, split evenly between the two qualified vendors at $500,000 each. The AQMD Board has previously authorized the MSRC to augment vendors’ contracts based on sales performance. Through orders fulfilled, A-Z Bus Sales had expended $300,000 of their $500,000 existing contract value. Subsequently they received an order from Menifee Union School District (MUSD) for five full-sized CNG buses. At $60,000 per bus, $300,000 would be needed to provide the full buydown incentive for this order, but A-Z Bus Sales’ remaining contract balance was only $200,000. At its April 19, 2007 meeting the MSRC awarded an additional $100,000 to A-Z Bus Sales to ensure MUSD could receive the $60,000 buydown for each bus. Because the full $1 million set aside for public school districts has already been allocated, this $100,000 would come from turnback funds. At this time the MSRC requests AQMD Board approval of the $100,000 augmentation/modification of A-Z Bus Sales’ contract.
  1. Local Government Match Program
    As mentioned in the Background section, on February 2, 2007 the AQMD Board approved Local Government Match Program Announcement #PA2007-09 as part of the MSRC’s FY 2006-07 Work Program. Subsequent to the release of the Program Announcement, it was discovered that the specific language relative to heavy-duty vehicle minimum qualifications is incomplete. The Program Announcement states that “Vehicle engines must be certified at or below the California Air Resources Board Optional NOx + NMHC (NOx+NMHC) standard in effect at the time of contract execution”. This language is correct for model year 2006 engines, but there is no longer an Optional NOx+NMHC standard for 2007 model year heavy-duty engines.

At its April 19, 2007 meeting, the MSRC considered and approved the issuance of an Addendum to the Program Announcement recommended by their MSRC-TAC, replacing the above-referenced current language Section III, page 17 to differentiate between 2006 and 2007 model year engines as follows: “Heavy-duty alternative fuel vehicles equipped with Model Year 2006 engines must be certified at or below the California Air Resources Board Optional NOx + NMHC (NOx+NMHC) standard. Heavy-duty alternative fuel vehicles equipped with Model Year 2007 engines must have a CARB NOx certification at least 30% lower than the comparable diesel-fuel engine.” The Addendum would be published and noticed in accordance with standard AQMD policies and procedures, additionally, written notice would be provided to entities that received the original Program Announcement notification. At this time the MSRC requests AQMD Board approval of the Addendum to the Local Government Match Program Announcement as part of the MSRC’s FY 2006-07 Work Program.

FYs 2007-08 and 2008-09 Work Programs
As mentioned in the Background section, the MSRC’s contract with Raymond Gorski for technical assistance services includes a single two-year option, to be executed at the MSRC’s discretion, subject to funding approval by the AQMD Board. The MSRC evaluated Mr. Gorski’s performance and approved exercising the option, extending the contract term to June 30, 2009 and increasing the contract value by $316,646.40. For the first year of the extended contract term, 75 percent (or $118,742.40) will be covered in the FY 2007-08 AB 2766 Discretionary Fund Work Program and the balance (25 percent or $39,580.80) will be covered by the MSRC’s administrative budget for FY 2007-08; and for the second year of the extended contract term, 75 percent (or $118,742.40) will be covered in the FY 2008-09 AB 2766 Work Program and the balance (25 percent or $39,580.80) will be covered by the MSRC’s administrative budget for FY 2008-09. At this time the MSRC requests AQMD Board approval of these allocations as part of the FYs 2007-08 and 2008-09 Work Programs.

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 described in this letter as part of the FYs 2003-04, 2005-06, 2006-07, 2007-08 and 2008-09 AB 2766 Discretionary Fund 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.


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