1.

ACCEPTANCE OF STATE FUNDS FOR EMISSION REDUCTION PROJECTS

[FUNDING SOURCE(S): STATE OF CALIFORNIA, CALIFORNIA ENERGY COMMISSION AND AIR RESOURCES BOARD] (4 VOTES)

APCB1.

SUBJECT:

ACCEPTANCE OF STATE FUNDS FOR EMISSION REDUCTION PROJECTS  (DISTRICTS: ALL)

Local agencies and private firms in the region have been allocated project funding from two new state funding sources, the California Energy Commission (CEC) Carl Moyer Infrastructure Program and the Air Resources Board (ARB) Emission Reduction Credit Bank (Bank).

The state agencies work directly with the project applicant in determining eligibility and project funding, but do not award funding directly to project proponents.  Instead, they award funds to local air districts to administer.  This means the Air Pollution Control District (District) will be responsible for entering into agreements with the state to accept the funds, entering into agreements for each local project, monitoring the projects, and disbursing funds.  This will be accomplished with existing budgeted staff.

On May 3, 2000, the California Energy Commission approved awarding $100,000 to the Oceanside Unified School District for a compressed-natural-gas fueling facility as part of the Carl Moyer Infrastructure Program.  The project has been on hold until now while the school district refined project requirements and sought additional funding.  Oceanside School District will receive another $100,000 toward this facility from the District Alternative-Fuel Vehicle and Infrastructure Incentive Program (4/25/01, APCB  #3).

On February 8, 2001, the Governor proclaimed a State of Emergency due to the California energy shortage and signed Executive Order D-24-01 ordering that an Emission Reduction Credit Bank be established to offset increased emissions from power plants.  The Governor also directed state funding of $68 million be made available for emission reduction projects to supply and maintain the credit bank. 

Subsequently, the state Air Resources Board (ARB) issued a Request for Proposals for projects.  To date, about 200 proposals have been received statewide, with seven, totaling approximately $1.0 million, from San Diego County.

ARB has approved one project for $95,636 to repower two diesel engines on a marine barge.  Funding for up to $2.5 million in projects in the region is expected between now and the end of the fiscal year.

In order to implement the projects as soon as possible, rapid turnaround of both the state and local agreements is required.  Therefore, it is requested that the Air Pollution Control Officer be authorized to accept awards for projects funded from the Bank, as they are received, and to enter into agreements with the local entities and administer the funds.  No local match is required and existing District staff will administer and monitor projects.  Your Board will be advised by memo each time additional project awards are accepted. 

Funds for this request are not budgeted.  The funding source is the State of California, $100,000 from the California Energy Commission and $2.5 million from the Air Resources Board.  If approved, this request will result in $2,600,000 current-year costs and offsetting revenue in the District's Vehicle Registration Fund.  No local match is required.  These one-time allocations for state-approved projects are not anticipated to continue in future years.  Staff time to administer these funds and monitor projects is within the current-year Operating Plan and will not require additional staff.

AIR POLLUTION CONTROL OFFICER

1.     Authorize the Air Pollution Control Officer to accept $100,000 awarded by the CEC Carl Moyer Infrastructure Program for the Oceanside Unified School District CNG fueling facility project and distribute awards according to state program guidelines.

2.     Authorize the Air Pollution Control Officer to accept up to $2.5 million awarded from the ARB for approved Emission Reduction Credit Bank projects and distribute funding in accordance with the terms of the award.

3.      Establish appropriations of $2,600,000 in the District’s Air Quality Trust fund based on  unanticipated revenue from the California Energy Commission ($100,000) and Air Resources Board Bank ($2.5 million) for approved projects.  (4 VOTES)

ON MOTION of Member Roberts, seconded by Member Cox, the Members of the Air Pollution Control Board took action as recommended, on Consent.