SR-05-27-2014-3L - 515-000-01City Council Meeting: May 277a, 2014
Agenda Item: 3L L
To: Mayor and City Council
From: Martin Pastucha, Director of Public Works
Subject: Contract with the South Coast Air Quality Management District for the
Purchase of Three Heavy -Duty Compressed Natural Gas (CNG) Vehicles
and the Installation of a Small CNG Station
Recommended Action
Staff recommends that the City Council authorize the City Manager to negotiate and
execute a contract with the South Coast Air Quality Management District ( SCAQMD), a
California -based entity, to receive matching grant funds in the amount of $149,925 for
the purchase of three heavy -duty CNG vehicles and the installation of a small time -fill
CNG station.
Executive Summary
On June 26, 2007 Council approved Contract No. 8730 (CCS) with the SCAQMD to
receive $149,925 in matching grant funds for the purchase of three heavy -duty CNG
vehicles and the installation of a small time -fill CNG station to reduce air pollution from
mobile sources. The project was delayed due to the lack of availability of CNG engines
for heavy -duty vehicle applications and longer than anticipated permitting process and
utility coordination for the CNG station. Staff requested a contract extension, which the
SCAQMD approved in a letter dated May 21, 2013. Staff did not execute the contract
modification prior to the expiration of the original contract date of July 11, 2013 due to
error. The SCAQMD agreed to issue a replacement contract at its October 17, 2013
meeting, resulting in a new contract term to November 30, 2016.
Staff recommends that Council approve this contract with the SCAQMD to replace
Contract No. 8730 (CCS) and receive matching grant funds in the amount of $149,925
for the purchase of three heavy -duty CNG vehicles and the installation of a small, time -
fill CNG station to reduce air pollution from mobile sources.
Background
On June 26 2007 Council approved Contract No. 8730 (CCS) with the SCAQMD for
$149,925 in matching grant funds for three heavy -duty CNG vehicles and funding for
the installation of a small, time -fill CNG station to reduce air pollution from mobile
sources.
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After Council approval, staff began the process of identifying three heavy -duty CNG
vehicles for purchase and the installation of a small, time -fill CNG station in order to
comply with the grant project timeline and requirements.
Discussion
CNG Station
FuelMaker Corporation was the only sole manufacturer of small CNG station parts and
equipment and Gas Equipment Systems was the authorized FuelMaker dealer for
California. A sole source agreement with Gas Equipment Systems was approved in
March 2008. Staff coordinated the work with Gas Equipment Systems, worked on
drawings and permits for the station, and coordinated the permitting process with the
Southern California Gas Company. The permitting process was delayed because
Southern California Gas Company took approximately one year to verify gas pressures,
gas quality, and install a meter to service the new station. During this process Gas
Equipment Systems became Mansfield Gas Equipment Systems. The permit to build
the small CNG station was issued in March 2011 and the installation of the small, time -
fill CNG station was completed by Mansfield Gas Equipment Systems in November
2011.
The CNG station is located at the City Yards and has increased operational efficiency
by allowing up to eight CNG vehicles to refuel overnight and by adding a reliable fuel
source to the City's inventory.
Heavy -duty CNG Vehicles
The purchase of three heavy -duty CNG vehicles for Water Resources operations was
also delayed because CNG engines were not available for heavy -duty vehicle
applications. Staff was aware of one company that was working on California Air
Resources Board (CARE) approvals for a CNG - fueled engine, but pulled out of the
market. It was some time before another company came out with an engine that met all
required certifications. As CNG engines for heavy -duty vehicle applications became
available, staff developed specifications and went to bid in March 2009. The user group
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determined that the bids received did not meet their needs and the specifications were
modified. The new bid was released in March 2010. Council awarded the bid for the
purchase of these three heavy -duty CNG vehicles to Plumbers Depot, Inc. on July 27,
2010. All three heavy -duty CNG vehicles were purchased and in service by February
2011.
The construction of CNG station and the purchase of CNG vehicles are consistent with
the City's Sustainable City Plan by promoting the use of an alternative fuel which
reduces smog - producing pollutants and greenhouse gas emissions.
Due to the delays experienced for the construction of the CNG station and the purchase
of the three heavy -duty CNG vehicles, staff submitted a contract modification to the
SCAQMD in early 2013 to extend the contract term by 40 months from the in- service
date of the vehicles and the installation of the CNG time -fill station. The SCAQMD
approved the contract modification in a letter dated May 21, 2013 but staff did not
execute the contract modification prior to the expiration of the original contract date of
July 11, 2013 due to error.
The SCAQMD's Mobile Source Air Pollution Reduction Review Committee agreed to
issue a replacement contract at its October 17, 2013 meeting, resulting in a new
contract term to November 30, 2016. Staff recommends that Council approve this
contract with the SCAQMD to replace Contract No. 8730 (CCS) and receive matching
grant funds in the amount of $149,925 for the purchase of three heavy -duty CNG
vehicles and the installation of a small time -fill CNG station.
All related expenditures were made in anticipation of receiving the grant funding and the
availability of the local match. The grant funds would offset the City's replacement cost
of these vehicles and the installation cost of the time -fill CNG station. All three vehicles
were scheduled for replacement through the City's Vehicle Replacement Program and
were not enhancements to the fleet.
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Financial Impacts & Budget Actions
The total SCAQMD grant amount is $149,925. Receiving the grant will require the
following budget actions in FY 2014 -15:
1. Increase revenue account 44459.407830 in the amount of $149,925
2. Appropriate funds to account IS440167.589000 in the amount of $149,925
3. Increase revenue account 54459.402660 in the amount of $149,925.
The grant's required 100% local match of $149,925 is already satisfied through
acquisition of the three heavy -duty CNG vehicles and the installation of the small, time-
fill CNG station ($1,004,453).
If renewals are awarded, budget changes will be included in subsequent year budgets,
pending Council budget adoption.
Prepared by: Heidi Said, Administrative Analyst
Approved:
Martin Pastucha
Director of Public Works
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Forwarded to Council:
Rod Gould
City Manager
Reference:
Contract No. 9911
(CCS)