BOARD MEETING DATE: January 9, 2009
AGENDA NO. 6

PROPOSAL:

Award Sole-Source Contract to Provide Temporary Refueling Infrastructure in Support of Mountain Area CNG School Bus Demonstration Program as Part of FY 2008-09 AB 2766 Discretionary Fund Work Program

SYNOPSIS:

At a special meeting on December 18, 2008, the MSRC unanimously approved a $30,000 sole-source contract to Gas Equipment Systems Inc. to provide temporary refueling infrastructure in support of the MSRC’s Mountain Area CNG School Bus Demonstration Program as part of the FY 2008-09 AB 2766 Discretionary Fund Work Program. As an element of the FY 2007-08 Work Program, the MSRC funded the demonstration of two CNG school buses at one or more mountain area school districts. The Bear Valley Unified School District elected to participate. This demonstration project includes the lease of two natural gas buses and the lease of a portable CNG refueling station. The portable CNG refueling station has recurrently experienced technical problems that the contractor has been unable to fully correct. To ensure continuance of the demonstration project, the MSRC approved installation of an alternative temporary CNG refueling station from a substitute vendor. The MSRC seeks the AQMD Board’s approval of this $30,000 sole-source award to Gas Equipment Systems Inc.

COMMITTEE:

Mobile Source Air Pollution Reduction Review, December 18, 2008, Recommended for Approval

RECOMMENDED ACTIONS:

1. Approve a sole-source contract award to Gas Equipment Systems Inc. in an amount not to exceed $30,000 to provide temporary refueling infrastructure in support of the MSRC’s Mountain Area CNG School Bus Demonstration Program as part of the FY 2008-09 Work Program, as described in this letter;
    
2. Authorize MSRC the authority to adjust this contract award up to five percent, as necessary, and previously granted in prior work programs; and
    
3. Authorize the Chairman of the Board to execute this sole-source contract under FY 2008-09 AB 2766 Discretionary Fund Work Program, as described above and within this letter.
    

Ron Roberts
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.

As an element of the FY 2007-08 Work Program, the MSRC funded the demonstration of two (2) CNG school buses at one or more mountain area school districts. The Bear Valley Unified School District elected to participate. This demonstration project is comprised of two elements: a) the lease of two natural gas buses from BusWest, Inc.; and b) the lease of a portable CNG refueling station from S-W Compressors, Inc. The portable CNG refueling station was installed and entered into operation on or about October 2008. Since that time, the portable CNG station has experienced multiple issues. Although CNG station repairs, reinstallations, and other corrective actions have been taken on at least three prior occasions, recently perceived safety issues have resulted in Bear Valley Unified School District’s unilateral decision to discontinue station operation until such time as perceived safety issues are corrected. Consequently, at a special meeting on December 18, 2008, the MSRC considered staff recommendations on how to resolve the problems to ensure continuation of the demonstration project. Further details are provided in the Proposals section.
 

Proposal

At a special meeting on December 18, 2008, the MSRC unanimously approved issuing a sole-source contract award to Gas Equipment Systems Inc. in an amount not to exceed $30,000 to provide temporary refueling infrastructure in support of the MSRC’s Mountain Area CNG School Bus Demonstration Program as part of the FY 2008-09 Work Program.

In lieu of attempting further repairs to the existing temporary refueling station provided by S-W Compressors, which staff believed could no longer be modified to the satisfaction of Bear Valley Unified, the MSRC approved an alternative temporary CNG refueling station from a substitute vendor--Gas Equipment Systems Inc.. The substitute station incorporates FuelMaker-brand components which have been successfully used in multiple past MSRC projects. The total recommended contract award in an amount not to exceed $30,000 equates to $2,500 per month for a 12-month period. Both the proposed cost and contract duration are consistent with the existing S-W Compressors contract.

The MSRC respectfully requests the AQMD Board’s approval of this sole-source contract award as part of the FY 2008-09 AB 2766 Discretionary Fund Work Program. The MSRC also requests authority to adjust the funds allocated to the 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 the agreement described in this letter.

Sole-Source Justification

Gas Equipment Systems Inc. is the only company with which the AQMD has an existing relationship and the only one staff is aware of with which: a) the MSRC/AQMD may be able to rapidly negotiate a contract; b) is able to install the equipment quickly so that the demonstration may move forward during the snow and cold weather this year, as was intended by the demonstration project; and c) is able to perform within a timeframe consistent with the period of leases in the companion BusWest contract. Any protracted delay in conducting a competitive procurement would be detrimental to the demonstration project. This sole source justification is consistent with VIII(2)( c)(1) and VIIIB(2)(d) of AQMD’s Contracting Policy because this is the only contractor prepared to install the equipment soon enough to prevent a lengthy interruption in the demonstration project and achieve the intent of the project to demonstrate the viability of CNG school buses during winter’s inclement weather.
 

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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