BOARD MEETING DATE: November 2, 2007
AGENDA NO. 4

PROPOSAL:

Execute Contracts for Rule 2202 AQIP and Execute Second Year Contract Option to Conduct the 2008 Lawn Mower Exchange Program

SYNOPSIS:

At its October 6, 2006 meeting, the Board approved release of an RFP to solicit projects to meet Rule 2202 AQIP emission reduction targets. Proposals for the funding opportunity have been reviewed. At its February 2, 2007 meeting, the Board approved a second year option that would secure a lower price to conduct the 2008 Lawn Mower Exchange Program. This action is to: (1) fund four AQIP projects in an amount not to exceed $949,883; (2) recognize $50,000 from CARB for the Lawn Mower Exchange Program; (3) execute the second year contract option with Neuton Lawn Mower Company to conduct the 2008 Lawn Mower Exchange Program at the previously set price in an amount not to exceed $730,000; and (4) allocate $116,000 from the AQIP Special Revenue Fund to carry out the 2008 Lawn Mower Exchange Program.

COMMITTEE:

Mobile Source, October 26, 2007, Recommended for Approval

RECOMMENDED ACTIONS:

1. Authorize the Chairman to execute the following contracts for a total amount not to exceed $949,883 from the Rule 2202 AQIP Special Revenue Fund.
1. A contract with A. L. Macintosh Company to generate emission reductions by repowering four single engine diesel scrapers with new low-emission engines certified to Tier 3 emission levels in an amount not to exceed $305,146.
2. A contract with Howard Contracting Company to generate emission reductions by repowering two single engine diesel wheel type scrapers with new low-emission engines certified to Tier 3 emission levels in an amount not to exceed $138,204.
3. A contract with Pick Your Part Auto Wrecking to generate emission reductions by scrapping old vehicles under Rule 1610 and using Rule 1612 credits in an amount not to exceed $500,000.
4. A contract with Rio Hondo College to generate emission reductions by offering students discounted transit passes in an amount not to exceed $6,533.
2. Recognize $50,000 from CARB for the Lawn Mower Exchange Program and place it in Rule 2202 AQIP Special Revenue Fund.
3. Execute the second year contract option with Neuton Lawnmower Company to purchase up to 4,000 electric lawnmowers and to conduct “Mow Down Air Pollution 2008” Lawnmower Exchange events in an amount not to exceed $730,000 from the AQIP Special Revenue Fund.
4. Transfer $116,000 from the AQIP Special Revenue Fund to Science & Technology’s FY 2007-08 Budget, Services and Supplies Major Object, Professional & Special Services account to solicit outside business and organizational support to assist in implementing AQMD’s “Mow Down Air Pollution 2008” Program.

Barry R. Wallerstein, D.Env.
Executive Officer

Background

The Rule 2202 AQIP allows subject employers to participate by electing to invest in an AQMD-administered restricted fund. Investment can be either $60 annually per employee reporting to the worksite during the 6:00 a.m. to 10:00 a.m. peak window, or $125 triennially per employee. The restricted monies are to be used by the AQMD to fund proposals that achieve mobile source emission reductions that would otherwise have been achieved by implementing a rideshare program. This Board letter contains a discussion regarding the disbursal of funds from the AQIP compliance option for the first semi-annual period of 2007.

Upon registering under this option and submitting the designated investment amount, an employer is considered to be in compliance with the Rule and there is no need for the employer to take further action to reduce mobile source emissions. The collected monies are used to fund alternative mobile source emission reduction strategies that reduce mobile source emissions at a more cost-effective rate which could potentially result in greater overall emission reductions.

The first half of Calendar Year 2007 participation period ended on June 30, 2007 with 130 employers participating in the AQIP program. The total amount of AQIP funds received during this period was $1,227,566, which includes both annual and triennial participants. An unspent amount of $98,774 from the prior period is available for funding in this period. In addition, an unspent amount of $111,789 is available from two projects, (City of Burbank (C06039) for $72,000, and 2006 Mow Down Pollution Project with Neuton Lawn Mower Company (C07231) for $39,789). CARB is providing $50,000 as part of CARB’s settlement with Toyota Motor to be used for the Lawn Mower Exchange Program. An additional amount of $529,019 is available from interest accrued in FY 2006-07. At its September 7, 2007 meeting, the Board approved the transfer of $66,950 from the AQIP Special Revenue Fund to the LADWP Settlement Projects Fund to replace the funds previously transferred for electric lawn mowers exchanged by residents within the LADWP’s jurisdiction. Therefore, the total amount available for this period is $1,950,198 (see Attachment 1, Table 4). Staff recommends that $1,795,883 be used to purchase emission reductions to satisfy the target for the first semiannual period of 2007.

Proposal Evaluation

During the bidding process for the first semiannual period of 2007, 11 proposals were received requesting funds ranging from $6,533 to $2,500,000. Attachment 2 illustrates a summary of emission reduction targets and the emission reduction credit balance. A summary of each proposal received and funds requested is provided in Attachment 3.

According to the requirements of the RFP (#2007-13), the proposals were divided into four different categories as listed in Attachment 4. This attachment provides an overall summary of the proposals by category, listing the proposals received, funds requested, total proposal costs, and emission reductions expected from each proposal. All proposals were reviewed and scored based on the information in the proposal as submitted to the AQMD. After the proposals were scored they were ranked by total score (as described in the RFP).

Selection Criteria

Attachment 5 provides a summary of the proposal rankings. All of the proposals were scored collectively by overall cost-effectiveness for a combination of VOC, NOx and CO emissions and then separated into different categories. Staff selected the projects that would meet the one-year targets for all three pollutants. As part of the selection process, staff based its selection on the scoring criteria outlined in the RFP. Reasons for recommendations made are provided at the end of each proposal summary in Attachment 3.

The proposals were scored collectively by overall cost-effectiveness for a combination of VOC, NOx and CO emissions (with the most cost-effective proposal receiving a score of 100) and then divided into separate categories and ranked by total score within each specific category as provided in the RFP. The RFP provides that the District will select the highest ranking proposals from each category, or that combination of high-ranking proposals from each category that will obtain all needed pollutant emission reductions at least cost. The top two scoring proposals in category #1, Off-road diesel repowering (A.L. Macintosh Company and Howard Contracting, Inc.); the second ranking proposal from category #2, Old-vehicle scrapping (Pick Your Part Auto Wrecking); the only proposal from category #4, Mobility Enhancing Services (Rio Hondo College) was selected as described above to meet the targets of all three pollutants VOC, NOx and CO. The proposal ranking slightly higher numerically in the Old-vehicle scrapping category submitted by Science and Technology Development Corporation was not selected. This contractor is yet to implement a similar contract (#07011) awarded in March 2006. The contractor selected has a demonstrated history of achieving and surrendering emission reductions in the timeframe required by AQIP contracts.

The following AQIP proposals are recommended for approval (as detailed in Attachment 6):

1. A.L. Macintosh Company                                                                        $305,146
   County: Los Angeles

A.L. Macintosh Company proposes to repower four single engine diesel scrapers with engines certified to Tier 3 emission levels. The cost-effectiveness of this proposal is $2.10 per pound. (Recommended for funding; ranked first in its category.)

2. Howard Contracting, Inc.                                                                            $138,204
County: Los Angeles

Howard Contracting, Inc. proposes to repower two single engine diesel wheel scrapers with engines certified to Tier 3 emission levels. The cost-effectiveness of this proposal is $2.04 per pound. (Recommended for funding; ranked second in its category.)

3. Pick Your Part Auto Wrecking                                                                     $500,000
County: All

Pick Your Part Auto Wrecking proposes to generate emission reductions by using programs administered under Rule 1610 – Old-Vehicle Scrapping; and Rule 1612 – Credits for Clean On-Road Vehicles. The cost-effectiveness of this proposal is $2.08 per pound. (Recommended for partial funding; ranked second in its category.)

   4. Rio Hondo College                                                                                         $6,533
County: Los Angeles

Rio Hondo College proposes to reduce student commute emissions by offering them discounted transit passes. Their partners include four transit agencies who are making in-kind contributions. Additional funding is coming from L.A. County, City of Pico Rivera and Measure “A” Bond fund. The cost-effectiveness of this proposal is $3.52 per pound. (Recommended for funding; only proposal in its category.)

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 Basin.

Additionally, potential bidders may have been notified utilizing AQMD’s own electronic listing of certified minority vendors. Notice of the RFP/RFQ have been 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 is also available on AQMD’s bidder’s 24-hour telephone message line (909) 396-2724.

Resource Impact

Total cost of expenditure for the proposed projects and implementation support shall not exceed $1,795,883 from the Rule 2202 Air Quality Investment Program Special Revenue Fund.

Attachments (DOC 184kb)

1. AQIP Funding and Participation
2. Summary of Emission Reduction Targets and Credit Balances
3. Summary of AQIP Proposals Received
4. Summary of Proposals by Type
5. Summary of Proposal Ratings
6. Recommendation for Funding