BOARD MEETING DATE: July 11, 2008
AGENDA NO. 10
PROPOSAL:
Recognize Additional Early Grant Funds under Proposition 1B from CARB, and Amend Early Grant Awards under Proposition 1B Goods Movement Emission Reduction Program
SYNOPSIS:
In January 2008, CARB awarded $13.8 million to the AQMD for Early Grant projects under the Proposition 1B Goods Movement Emission Reduction Program. In May 2008, the Board recognized $13.8 million from CARB and approved execution of contracts to replace 260 pre-2003 heavy-duty diesel trucks with 2007 or newer diesel and LNG trucks. In the June 3, 2008, FY 2007-08 Early Grant Agreements, CARB increased the total number of trucks to be funded by three trucks, including one non-drayage and two drayage trucks. In order to allocate funds for the additional trucks, CARB increased AQMD’s Early Grant amount by $7,500 from $13,800,000 to $13,807,500 and decreased the administrative funds from $800,000 to $657,500. This action is to receive these additional funds and amend appropriate contracts.
COMMITTEE:
Technology, June 20, 2008. Less than a quorum was present for the discussion of this item; the committee members recommended that this item be forwarded for Board consideration with concurrence from the Committee members present.
RECOMMENDED ACTIONS:
Authorize the Chairman to:
- Recognize an additional $7,500 in Early Grant funds from CARB under Proposition 1B, Goods Movement Emission Reduction Program and place it in the AQMD’s Proposition 1B Goods Movement Fund 81.
- Amend the following two Proposition 1B contracts with:
- California Cartage Company to replace 132 (instead of 130) Class 8 pre-2003 diesel trucks with LNG trucks in an amount not to exceed $11.88 million. The additional $180,000 in funding is comprised of $100,000 from the Proposition 1B Goods Movement Fund 81 and $80,000 from the Clean Fuels Fund 31;
- S.G. Leaseco LLC (Apex Bulk Commodities) to replace six (instead of five) Class 8 pre-2003 diesel trucks with new diesel trucks in an amount not to exceed $300,000 with the additional $50,000 funding from the Proposition 1B Goods Movement Fund 81.
Barry R. Wallerstein, D.Env.
Executive Officer
Background
The Goods Movement Emission Reduction Program is a $1 billion bond program funded by Proposition 1B that was approved by voters in November 2006. This is a new incentive program designed to reduce diesel emissions and public health risks from goods movement activities along California’s trade corridors. The program will provide financial incentives to upgrade vehicles and equipment used in goods movement to cleaner technologies.
Out of $250 million budgeted for the Goods Movement Emission Reduction Program in
FY 2007-08, CARB has made $25 million available for Early Grant projects. In February 2008, CARB awarded $13.8 million to AQMD for replacing 260 older heavy-duty trucks with 2007 or newer diesel and LNG trucks.
In May 2008, the Board recognized the $13.8 million Early Grant funding and approved execution of contracts to replace 260 older diesel trucks with 130 LNG drayage and 130 diesel non-drayage trucks. In the June 3, 2008 Fiscal Year 2007-08 Early Grant Agreements, CARB increased the total number of trucks to be funded by three, comprised of one non-drayage diesel and two drayage LNG trucks. In order to allocate funds for the additional trucks, CARB increased AQMD’s total Early Grant funding amount by $7,500 from $13,800,000 to $13,807,500, and decreased the administrative funds from $800,000 to $657,500.
Proposal
Staff recommends that the Board recognize the additional $7,500 Early Grant funds from CARB under the Proposition 1B Goods Movement Emission Reduction Program and place it in the AQMD’s Proposition 1B Goods Movement Fund 81. Staff also recommends that the Board approve the amendment of the original awards to increase by two the number of LNG drayage trucks and one additional new diesel non-drayage truck. In total, 132 drayage and 131 non-drayage trucks will be replaced pursuant to CARB’s recommendation under the Early Grant award. The proposed amendments will include $230,000 in total increased funding for the projects comprised of $150,000 from the Proposition 1B Goods Movement Fund 81, and $80,000 from the Clean Fuels Fund. The proposed projects meet CARB’s requirements as outlined in their Final Guidelines for Implementation as adopted on February 28, 2008.
Benefits to AQMD
The successful implementation of the proposed projects will reduce NOx and PM emissions in a cost-effective and expeditious manner to meet the goals of the 2007 AQMP. For example, the LNG truck engines are certified to the lowest NOx emissions standards of any heavy-duty engine available to date, representing a reduction of over 80% in NOx emissions. These vehicles will operate for many years and provide long-term emission reductions.
Resource Impacts
The projects funding increase compared to the awards originally approved by the Board on May 2, 2008, is $230,000, comprised of $150,000 from the Proposition 1B Goods Movement Funds 81, and $80,000 from the Clean Fuels Fund 31.
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.