BOARD MEETING DATE: December 5, 2008
AGENDA NO. 10

PROPOSAL:

Approve New and Amended Contracts/Awards under FYs 2005-06, 2006-07, 2007-08 and 2008-09 AB 2766 Discretionary Fund Work Programs

SYNOPSIS:

Using unallocated funds, the MSRC approved an additional $1,140,000 to BusWest and a $156,000 new/replacement contract to A-Z Bus Sales for alternative fuel school bus incentives as part of FYs 2007-08 and 2008-09 Work Programs, respectively. Also using unallocated funds, the MSRC approved an additional $50,475 toward the Off-Road Diesel Equipment Retrofit “Showcase” Program as part of FY 2006-07 Work Program. For the remaining FY 2008-09 Work Program elements, the MSRC approved a $2,550 contract increase for Haaland Internet Productions for website upgrades, a $3 million set aside for a Local Government Match Program, and $2.4 million in additional funds for its Alternative Fuel School Bus Program including a contract amendment adding $640,000 for A-Z Bus Sales. On June 30, 2008, the MSRC approved a modified award substituting natural gas for liquefied petroleum on three heavy-duty trucks to the County of Los Angeles, Department of Public Works. The MSRC seeks AQMD Board approval of these new and amended contracts/awards under FYs 2005-06 through 2008-09 Work Programs.

COMMITTEE:

Mobile Source Air Pollution Reduction Review, June 30 and November 20, 2008, Recommended for Approval

RECOMMENDED ACTIONS:

  1. Approve modified award to issue a contract to the County of Los Angeles, Department of Public Works, substituting three heavy-duty natural gas trucks for three liquefied petroleum gas trucks as part of the FY 2005-06 Work Program, as described in this letter;
  2. Reallocate $1,081,818, which was originally awarded to the California Department of Transportation (Caltrans) to participate in the “Showcase” Program through the purchase, installation, demonstration and evaluation of diesel emission control systems on heavy-duty off-road diesel construction equipment, as well as an additional amount of $50,475, using unallocated funds, and approve ten awards totaling $1,132,293 to manufacturers of diesel emission control systems to be installed and demonstrated on Caltrans’ equipment, as part of the FY 2006-07 Discretionary Fund Work Program, as described in this letter, in the Showcase Program Match List for Caltrans detailing the vehicles that will receive the respective devices, and as follows:
    1. An award to Clean Diesel Technologies in an amount not to exceed $240,347 to install, demonstrate and evaluate diesel emission control systems on Caltrans’ off-road diesel construction equipment;
    2. An award to DCL International in an amount not to exceed $153,010 to install, demonstrate and evaluate diesel emission control systems on Caltrans’ off-road diesel construction equipment;
    3. An award to Dinex Exhausts in an amount not to exceed $52,381 to install, demonstrate and evaluate diesel emission control systems on Caltrans’ off-road diesel construction equipment;
    4. An award to Donaldson in an amount not to exceed $42,416 to install, demonstrate and evaluate diesel emission control systems on Caltrans’ off-road diesel construction equipment;
    5. An award to Engine Control Systems in an amount not to exceed $155,746 to install, demonstrate and evaluate diesel emission control systems on Caltrans’ off-road diesel construction equipment;
    6. An award to Huss in an amount not to exceed $84,871 to install, demonstrate and evaluate diesel emission control systems on Caltrans’ off-road diesel construction equipment;
    7. An award to Mann Hummel in an amount not to exceed $189,361 to install, demonstrate and evaluate diesel emission control systems on Caltrans’ off-road diesel construction equipment;
    8. An award to Nett Technologies in an amount not to exceed $118,760 to install, demonstrate and evaluate diesel emission control systems on Caltrans’ off-road diesel construction equipment;
    9. An award to Rypos in an amount not to exceed $68,055 to install, demonstrate and evaluate diesel emission control systems on Caltrans’ off-road diesel construction equipment;
    10. An award to Sud Chemie in an amount not to exceed $27,345 to install, demonstrate and evaluate diesel emission control systems on Caltrans’ off-road diesel construction equipment;
  3. Approve a funding augmentation in an amount not to exceed $1,140,000 to existing contract #MS08004 with BusWest under the Alternative Fuel School Bus Incentives Program, using unallocated funds, as part of the FY 2007-08 Work Program, as described in this letter;
  4. Approve Partial FY 2008-09 AB 2766 Discretionary Fund Work Program with the following elements:
    1. Website Upgrades totaling $2,550;
    2. Additional Local Government Match Program totaling $3,000,000;
    3. Additional Alternative Fuel School Bus Incentives Program totaling $2,400,000;
    4. CNG School Bus Incentives Program totaling $156,000;
  5. Approve a contract modification to add $2,550 to existing contract #MS05070 with Haaland Internet Productions (HiP Design) under the FY 2008-09 Work Program, as described in this letter;
  6. Approve a funding augmentation in an amount not to exceed $640,000 to existing contract #MS09002 with A-Z Bus Sales under the Alternative Fuel School Bus Incentives Program as part of the FY 2008-09 Work Program, as described in this letter;
  7. Approve award of a new/replacement contract in an amount not to exceed $156,000 to A-Z Bus Sales under the CNG School Bus Incentives Program, as part of the FY 2008-09 Work Program, as described in this letter;
  8. Authorize MSRC the authority to adjust contract awards up to five percent, as necessary and previously granted in prior work programs; and
  9. Authorize the Chairman of the Board to execute new and modified contracts under FYs 2005-06, 2006-07, 2007-08 and 2008-09 AB 2766 Discretionary Fund Work Programs, as described above and within this letter.
     

Greg Winterbottom,
Vice-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 Board.

FY 2005-06 Work Program

As part of the FY 2005-06 Work Program, the County of Los Angeles, Department of Public Works was awarded a contract under the MSRC’s Local Government Match Program for $175,000 towards the purchase of a seven heavy-duty liquefied petroleum gas (LPG) trucks. The County has requested substitution of three CNG trucks for three of the LPG trucks. The MSRC considered their request for a modified award at its June 30, 2008 meeting. Further details are described below in the Proposals section.

FY 2006-07 Work Program

As an element of their FY 2006-07 Work Program, the MSRC awarded $3,641,013 to 18 fleets for 198 off-road vehicles to participate in the joint MSRC/California Air Resources Board Showcase Program, with each vehicle demonstrating one of 30 participating after-treatment devices. The goals of the Showcase Program are to reduce the public’s exposure to diesel exhaust particulate and encourage the verification of diesel retrofit devices for off-road construction equipment. One of the fleets which applied to participate in the Showcase Program is Caltrans. Subsequent to receiving an award, Caltrans indicates that they do not have budgetary authority to accept MSRC reimbursement or to issue purchase orders for the Showcase Program devices. Caltrans requests the MSRC to consider an alternate contracting mechanism. Additionally, based on updated information, the suitability of devices for some vehicles has changed; thus necessitating that the vehicles matched with these devices be re-matched with other devices. Several awards have also been determined to be significantly lower than costs for the retrofits. As a result of the re-matching and award/cost differences, the amount originally awarded to Caltrans is not sufficient to cover the anticipated costs of retrofitting their participating vehicles. On November 20, 2008, the MSRC considered options for addressing these developments. Further details are described below in the Proposals section.

FY 2007-08 Work Program

As part of the FY 2007-08 Work Program, the MSRC allocated a total of $1.78 million for the Alternative Fuel School Bus Incentives Program to provide buydown incentives for school districts. To implement the Program, the MSRC awarded contracts to A-Z Bus Sales and BusWest, with each qualified vendor initially awarded $300,000; subsequently, A-Z Bus Sales’ contract value has been increased due to sales performance. At its November 20, 2008 meeting, the MSRC considered a request from BusWest for an additional $1,200,000 for buses already delivered to the Perris Union High School District; further details are provided below in the Proposals section.

FY 2008-09 Work Program

The MSRC maintains a website http://www.cleantransportationfunding.org for outreach and assistance to contractors, proposers and others interested in clean transportation. Development of the website was done several years ago by Haaland Internet Productions (HiP Design), and HiP Design continues to provide maintenance and hosting services to the MSRC. HiP Design has identified a need to upgrade the website server’s hard drive before it filled up. Additionally, the MSRC-TAC’s Administrative Subcommittee monitors the website and periodically evaluates or develops ideas for potential improvements. At its November 20, 2008 meeting, the MSRC considered recommendations from its MSRC-TAC for five areas of improvement for the website, hardware replacement, and establishment of a budget for future critical hardware and/or software needs, and the funding required to implement these concepts. Further details are provided in the Proposals section.

As part of the FY 2008-09 Work Program, the MSRC previously allocated a total of $600,000 for the Alternative Fuel School Bus Incentives Program to provide buydown incentives for school districts. The MSRC awarded the $600,000 to A-Z Bus Sales based upon their pending orders. At its November 20, 2008 meeting, the MSRC considered requests from A-Z Bus Sales for an additional $640,000 for orders from the Lake Elsinore, Baldwin Park, Inglewood, Beaumont, and Acton Agua Dulce School Districts; further details are provided below in the Proposals section.

The MSRC previously set aside a total of $6.76 million to continue the CNG School Bus Incentives Program as part of the FY 2006-07 Work Program. Of this amount, $4 million was allocated to provide buydown incentives for private providers of student transportation and $2.76 million was allocated for public school districts. To implement the public school district portion of the program, the MSRC awarded sole-source contracts to A-Z Bus Sales and BusWest. At its November 20, 2008 meeting, the MSRC reconsidered a request from A-Z Bus Sales for an additional $180,000 for CNG buses already delivered to Fontana Unified School District; further details are provided in the Proposals section.
 

Proposals

At its June 30 and November 20, 2008 meetings, the MSRC considered recommendations from its MSRC-TAC and unanimously approved the following:

FY 2005-06 Work Program

As stated in the Background section, the County of Los Angeles, Department of Public Works has revised their vehicle purchase plans and requests substitution of CNG trucks for three of the seven LPG trucks for which they were awarded funding. The FY 2005-06 Local Government Match Program offered funding for both CNG and LPG vehicles. The MSRC considered and approved the County’s request for a modified award at its June 30, 2008 meeting.

FY 2006-07 Work Program

As stated in the Background section, Caltrans has indicated that they have no budgetary authority to issue purchase orders or to accept reimbursement for Showcase Program devices. MSRC and AQMD staff considered potential approaches to this issue, and the only viable alternative identified to retain Caltrans’ participation was the issuance of contracts to the device manufacturers. The device manufacturers had submitted qualifications packages in response to RFQ2007-08 – Off-Road Diesel Construction Equipment Retrofit Demonstration Program Request for Manufacturer Qualifications and Participation Application and were qualified to participate in the Program. These manufacturer contracts would be coupled with Caltrans’ entering into a participation agreement to fulfill the non-monetary requirements incumbent upon Showcase Program fleets, including but not limited to indemnification for AQMD. Additionally, MSRC staff determined that the amount originally awarded for retrofit of Caltrans’ participating vehicles is not sufficient to cover the anticipated cost. On November 20, 2008, the MSRC considered options to address these issues. Based on recommendations from its MSRC-TAC, the MSRC unanimously approved the award of an additional $50,475, using unallocated funds. The MSRC further approved the reallocation of the original $1,081,818 award, and that the total of $1,132,293 be awarded to the ten manufacturers whose diesel emission control systems are matched with the participating Caltrans vehicles. At this time the MSRC requests approval of the following ten awards to manufacturers of diesel emission control systems to be installed and demonstrated on Caltrans’ equipment, as part of the FY 2006-07 Discretionary Fund Work Program:

  1. An award to Clean Diesel Technologies in an amount not to exceed $240,347 to install, demonstrate and evaluate diesel emission control systems on Caltrans’ off-road diesel construction equipment;
  2. An award to DCL International in an amount not to exceed $153,010 to install, demonstrate and evaluate diesel emission control systems on Caltrans’ off-road diesel construction equipment;
  3. An award to Dinex Exhausts in an amount not to exceed $52,381 to install, demonstrate and evaluate diesel emission control systems on Caltrans’ off-road diesel construction equipment;
  4. An award to Donaldson in an amount not to exceed $42,416 to install, demonstrate and evaluate diesel emission control systems on Caltrans’ off-road diesel construction equipment;
  5. An award to Engine Control Systems in an amount not to exceed $155,746 to install, demonstrate and evaluate diesel emission control systems on Caltrans’ off-road diesel construction equipment;
  6. An award to Huss in an amount not to exceed $84,871 to install, demonstrate and evaluate diesel emission control systems on Caltrans’ off-road diesel construction equipment;
  7. An award to Mann Hummel in an amount not to exceed $189,361 to install, demonstrate and evaluate diesel emission control systems on Caltrans’ off-road diesel construction equipment;
  8. An award to Nett Technologies in an amount not to exceed $118,760 to install, demonstrate and evaluate diesel emission control systems on Caltrans’ off-road diesel construction equipment;
  9. An award to Rypos in an amount not to exceed $68,055 to install, demonstrate and evaluate diesel emission control systems on Caltrans’ off-road diesel construction equipment;
  10. An award to Sud Chemie in an amount not to exceed $27,345 to install, demonstrate and evaluate diesel emission control systems on Caltrans’ off-road diesel construction equipment.

FY 2007-08 Work Program

As stated in the Background section, BusWest was awarded a $300,000 contract to provide buydown incentives for school buses as part of the MSRC’s FY 2007-08 Work Program. BusWest has already been paid $300,000 and the contract is currently open with a zero balance. BusWest delivered 20 buses purchased by Perris Union High School District, prior to getting MSRC approval for the incentives, and requested a $1,200,000 increase to contract #MS08004 to cover the full buydown incentive for these bus deliveries. On November 20, 2008, the MSRC considered this request and elected to award less than the full amount requested, and awarded BusWest $1,140,000 from unallocated funds as part of the FY 2007-08 Work Program.

FY 2008-09 Work Program

At its September 30, 2008 meeting, the MSRC established additional elements as well as increased funding levels for existing elements for its FY 2008-09 AB 2766 Discretionary Fund Work Program, as follows:

  1. Website Upgrades totaling $2,550;
  2. Additional Local Government Match Program funding in the amount of $3,000,000, resulting in total FY 2008-09 Local Government Match Program funding to date of $4,239,435;
  3. Additional Alternative Fuel School Bus Incentives Program funding in the amount of $2,400,000, resulting in total FY 2008-09 Alternative Fuel School Bus Incentives Program funding to date of $3,000,000; and
  4. CNG School Bus Incentives Program totaling $156,000.

The MSRC approved contract awards for some of these elements, which are delineated below for the AQMD Board’s consideration. No further FY 2008-09 Work Program elements are anticipated.
 

Website Upgrades

As mentioned in the Background section, the MSRC maintains a website http://www.cleantransportationfunding.org which was designed and is still maintained and hosted by HiP Design on behalf of the MSRC. Five areas for improvement of the website have been identified: 1) to add capability to put captions on photos; 2) to add capability to size the titles of newsletter articles; 3) to enable the addition of a third graphic/image to a newsletter article; 4) to add a function which would allow a reader to print out the entire newsletter with one action; and 5) to modify the graphical user interface on the home page to make its functionality clearer. HiP Design proposed to perform these improvements under its existing contract #MS05070 for a total cost of $1,800. Additionally, HiP Design identified that the website server’s hard drive was close to full, and they estimated direct costs and labor for replacement with a larger capacity drive at $250. In considering the hard drive cost, the MSRC-TAC also discussed that other urgent hardware and/or software needs could arise during the remaining term of HiP Design’s contract. They recommended establishment of a $500 contingency for hardware and/or software expenses, only to be used as necessary to ensure that the website continues to operate properly. At its November 20, 2008 meeting, as part of the FY 2008-09 Work Program, the MSRC considered recommendations from its MSRC-TAC and unanimously approved an additional $2,550 to HiP Design’s existing contract for this work.
 

Alternative Fuel School Bus Incentives Program

As mentioned in the Background section, the MSRC previously awarded $600,000 to A-Z Bus Sales to continue implementation of the Alternative Fuel School Bus Incentives Program, based upon their pending orders. A-Z Bus Sales then received orders from the Lake Elsinore, Baldwin Park, Inglewood, Beaumont, and Acton Agua Dulce School Districts for a total of eight CNG and four propane school buses. The propane buses would each be eligible for a $40,000 incentive and each of the CNG buses for a $60,000 incentive, totaling $640,000. These buses have not yet been delivered; A-Z Bus Sales is securing funding prior to delivery, as anticipated by contract #MS09002. The $600,000 awarded to A-Z Bus Sales under the MSRC’s FY 2008-09 Work Program already has purchase orders issued against it. Therefore, A-Z Bus Sales requested an additional $640,000 to cover the buydown incentives for these twelve buses. As mentioned above, on November 20, 2008 the MSRC approved an additional $2,400,000 for the Alternative Fuel School Bus Incentives Program as part of their FY 2008-09 Work Program, and the MSRC unanimously approved the award of $640,000 out of this amount to A-Z Bus Sales in order to provide the full incentives for the ordered buses.
 

CNG School Bus Incentives Program

Also as stated in the Background section, A-Z Bus Sales was awarded a contract to provide buydown incentives for CNG school buses as part of the MSRC’s FY 2006-07 Work Program. The value of contract #MS07001 was increased several times based on A-Z Bus Sales’ purchase orders, and ultimately the contract reached a value of $1,920,000. The term of the contract expired on February 29, 2008. Based on A-Z Bus Sales’ assurances that they had no further invoices to submit, #MS07001 was closed and the balance reverted to the AB 2766 Discretionary Fund. Subsequently, A-Z Bus Sales discovered that they did not invoice for three CNG buses delivered to the Fontana Unified School District on December 31, 2007. A-Z Bus Sales requested a $180,000 contract value increase to enable them to obtain full reimbursement for these buydown incentives. On November 20, 2008, the MSRC reconsidered this previously denied request and unanimously approved a new/replacement contract for A-Z Bus Sales in an amount not to exceed $156,000, from unallocated funds, as part of the FY 2008-09 Work Program. The MSRC determined to award only $52,000 per bus, less than the amount requested, because Fontana Unified School District already has fueling infrastructure in place.
 

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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