BOARD MEETING DATE: September 5, 2008
AGENDA NO. 10
PROPOSAL:
Allocate and Disburse Funds to Assist in Purchase of Natural Gas Vehicles for Taxicab Services
SYNOPSIS:
There continues to be a demand for pre-owned older gasoline Ford Crown Victorias for taxicab service. The AQMD has been providing funding assistance for new natural gas powered Crown Victorias, which are certified by BAF Technologies to the SULEV emissions standard. This action is to authorize the allocation and disbursement of $750,000 from the Clean Fuels fund to assist in the purchase of natural gas powered vehicles for taxicab operations at commercial airports.
COMMITTEE:
Technology, July 25, 2008, Recommended for Approval
RECOMMENDED ACTIONS:
- Allocate $750,000 from the Clean Fuels Fund (Fund 31) to assist in the buydown of up to seventy-five natural gas-powered vehicles for taxicabs at commercial airports (combination of Crown Victorias and Lincoln Town Cars) and to facilitate implementation of Rule 1194.
- Authorize the Executive Officer to approve disbursement, up to $10,000 per vehicle, of these funds to cover the co-funding on a first come basis and in the same manner as prior funding requests for taxicab buydown incentives.
Barry R. Wallerstein, D.Env.
Executive Officer
Background
AQMD has historically provided funding assistance to taxicab operators for the purchase of Rule 1194 compliant alternative-fuel taxicabs. Through the 2004 model-year, Ford Motor Company produced a ULEV certified natural gas-powered Crown Victoria that could be used in taxicab applications, and hundreds of these vehicles were purchased by taxicab operators using AQMD co-funding. When Ford announced that it would no longer produce the natural gas-powered Crown Victoria, the Board co-funded BAF Technologies to develop and certify a natural-gas powered Crown Victoria meeting at least ultra-low-emission vehicle (ULEV) certification levels. On March 8, 2006, the CARB certified a 2006 model year natural gas-powered Crown Victoria meeting the super-ultra-low emission vehicle (SULEV) certification level. BAF has continued to receive SULEV certification for the Crown Victoria on 2007 and 2008 model-years. BAF expects CARB certification for the 2009 model year natural gas-powered Crown Victoria before the end of 2008.
With regard to the historical funding of natural gas-powered taxicabs, the Board approved numerous funding programs to promote the purchase of these vehicles. To date, the Board has approved a total of $5.8 million to assist in the buy-down of these vehicles, with various incentive levels ranging from $13,000 to $23,800 per vehicle. In addition, the Board approved MSRC funding for an additional $750,000, providing a per vehicle incentive level of $3,000.
Staff continues to receive positive feedback regarding the demand for these vehicles from taxicab fleet operators and the desire for continued co-funding from the AQMD for the purchase of these vehicles. A summary of the cost of a natural gas-powered vehicle and potential funding incentives are provided below.
| Vehicle Cost Breakdown | ||
| Gasoline Crown Victoria (taxicab option): | $28,250 | (MSRP) |
| Upfit Cost to CNG: | $14,500 | |
| Freight Cost between Dealer and Vehicle Converter | $ 1,000 | |
| Sales Tax | $ 3,610 | |
| Registration Fee |
$ 360
|
|
| Total | $47,720 | |
| Potentially Available Incentives | ||
| CARB Alternative Fuel Rebate Incentive Program | $ 3,000 | |
| Federal Tax Credit | $ 4,000 | |
| Ford Fleet Incentive | $ 2,500 | |
| Total | $ 9,500 |
In addition to Crown Victorias, there has been a growing population of Lincoln Town Cars being used as taxicabs. BAF’s natural gas certifications include the Town Car along with the Crown Victoria.
Proposal
Historically, the AQMD has been providing approximately $16,000 per vehicle to buydown the cost of a new natural gas Crown Victoira. Staff believes a lower level of funding is more appropriate at this time. Staff is recommending that $750,000 be allocated to assist in the buydown of up to 75 natural gas-powered vehicles used in taxicab service. The natural gas-powered vehicles that are proposed to be funded would be 2009 or newer model year Crown Victorias or Lincoln Town Cars that are newly built or have no more than 20,000 miles. The $750,000 would be allocated from the Clean Fuels Fund (Fund 31) and the funding level would be $10,000 per vehicle. The buydown program will be implemented by staff in the same manner as the previous natural gas-powered taxicab buydown programs whereby funds will be disbursed on a first come basis and the applicant completes a Rule 1194 Funding Application Form. A maximum of $19,500 of co-funding would be available per new vehicle from all potential sources. To the extent that additional funding sources are identified, the AQMD co-funding would be reduced such that the maximum co-funding is at $19,500. In addition, given the differential cost between natural gas fuel and gasoline, there will be additional cost savings to the operator.
Resource Impacts
The maximum cost for the proposed project is $750,000. The funding contributions from the Clean Fuel Funds shall not exceed this amount.
Sufficient funds are available in the Clean Fuels Fund, which is established as special revenue 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.