ORANGE COUNTY TRANSPORTATION AUTHORITY Award of Liquefied Natural Gas Contract Staff Report
April 11, 2013 To: From: Subject: Transit Committeee Darrell Johnson, Chief Executive Officer Award of Liquefied Natural Gas Contract Overview The Orange County Transporta tion Authority currently operates 228 busess that utilize liquefied natural gas fuel. The requirement for a steady supply of this fuel remains through the year 2018. On February 25, 2013, the Orange County Transportation Authority Board of Directors approved the release of an invitation for bids to provide the supply and delivery of liquefied natural gas fuel. Bids were received in accordance with the Orange County Transportation Authority s procurement procedures for competitive sealed bids. Staff is seeking approval to award a new contractt for the continued supply of liquefied natural gas. Recommendation Authorize the Chief Executive Officer too execute Agreement No. C-3-1406 between the Orange County Transportation Authority and Applied LNG Technologies, LLC, in an amount of $16,212,500, to provide the supply and delivery of liquefied natural gas fuel for a three-year initial term, with three one-year option terms, effectivee June 1, 2013. Discussion The Orange County Transportation Authority (OCTA) operates a fleet of 520 natural gas burning vehicles. The fleet t includes 228 liquefied natural gas (LNG) powered buses, of whichh 193 are used for directly operated servicee and 35 are leased to Anaheim Transportation Network. The Anaheim and Garden Grove bus bases each have underground storage tanks for LNG fuel with storage capacity of 50,000 gallons each. On average, OCTA s fleet consumes approximately 22,0000 gallons of LNG on an averagee weekday. Applied LNG Technologies (ALT) has been our primary supplier for LNG fuel since June 2003. ALT operates a plant in Topock, Arizona that currently produces 90,000 gallons of LNG on a daily basis. Orange County Transportation Authority 550 South Main Street / P.O. Box 14184 / Orange / California 92863-1584 / (714) 560-OCTA (6282)
Award of Liquefied Natural Gas Contract Page 2 The OCTA bus fleet plan includes operating LNG powered buses through 2017, as the LNG tanks require removal during the 2018 calendar year when their certifications expire. As part of the fleet plan, the LNG buses will start to be replaced incrementally with compressed natural gas buses beginning in 2014. The fleet plan calls for the replacement of LNG powered buses at a rate of approximately 60 buses per fiscal year. The replacement of LNG buses will continue through the end of the new LNG fuel contract. The current contract with ALT expires on May 31, 2013. As a result, the development of a solicitation to meet the LNG fueling requirements was prepared and issued. Procurement Approach This procurement was handled in accordance with the OCTA s Board of Directors (Board)-approved policies and procedures for competitive sealed bids. These procedures, which conform to both federal and state requirements, are used when minimum requirements can be clearly specified and, therefore, the lowest price is the only criterion for choosing among the responsive and responsible bidders, after a sealed bidding process. On February 25, 2013, the Board authorized the release of Invitation for Bids (IFB) No. 3-1406, which was issued and sent electronically to 396 firms registered on CAMM NET. The solicitation was advertised on February 25 and March 4, 2013 in a newspaper of general circulation. Two addenda were issued to respond to questions related to the IFB. On March 21, 2013, two sealed bids were received and publicly opened. The bids were reviewed by OCTA staff from Contracts Administration and Materials Management to ensure compliance with the contract terms and specifications. The list of bidders and their respective bid amounts are presented below: Firm and Location Applied LNG Technologies, LLC Westlake Village, California Clean Energy Seal Beach, California Bid Amount $16,212,500 $16,890,000
Award of Liquefied Natural Gas Contract Page 3 Staff recommends award of the contract for the supply and delivery of LNG natural gas fuel to Applied LNG Technologies, LLC, the lowest responsive, responsible bidder, in the amount of $16,212,500. Fiscal Impact The project was approved in OCTA s Fiscal Year 2012-13 Budget, Materials Management, Account 0030-00000-000-1419, and is funded through Local Transportation Funds. Summary Staff recommends award of Agreement No. C-3-1406 to Applied LNG Technologies, LLC, in the amount of $16,212,500, to provide the supply and delivery of liquefied natural gas fuel for a three-year initial term, with three oneyear option terms.
Award of Liquefied Natural Gas Contract Page 4 Attachment A. None Prepared by: Approved by: Ronald Rojas Section Manager, Materials Management 714-560-5781 Kenneth Phipps Executive Director, Finance and Administration 714-560-5637 Virginia Abadessa Director, Contracts Administration and Materials Management 714-560-5623