Goods Movement Emission Reduction Funding Program (Proposition 1B)

Approved Contract Documents for AQMD’s Heavy-Duty Diesel Drayage Truck Replacement Program

The California Air Resources Board (CARB) has approved three (3) contract models for AQMD’s implementation of the Proposition 1B Goods Movement Emission Reduction Program.  This program is also known as the “AQMD Heavy-Duty Diesel Drayage Truck Replacement Program.” 

If your truck replacement project has been approved by AQMD, you will need to select one of the approved contract models.  You will need to inform the AQMD Project Officer of the applicable contract model for each truck replacement project approved by AQMD.  If you do not know who your assigned AQMD Project Officer is, you may call Penny Shaw Cedillo at (909) 396-3179 for assistance.

Locomotive Funding Program

Prop 1B Frequent Asked Questions (PDF, 98KB)

AQMD Approved Dismantlers (PDF, 6KB) - updated 1-6-12

Dealer Certification Letter (PDF, 30KB)

Dealer Certification Form (PDF, 42KB)

Below please find a brief description of the three contract models approved for this program and a link to the boilerplate contract documents. These documents set forth all of the conditions and obligations that you must meet under this Program.  It is also important to note that the contract documents below are the final versions approved by CARB.  Any requested changes to these documents will require CARB approval which will delay the contracting process and may not result in an approval by CARB.

Important Note: Placing a Purchase Order prior to the execution of contract documents does not guarantee payment of the grant award and is, therefore, done at the applicant’s risk of not receiving the grant funds.  Also, all liens on the old truck must be cleared prior to contract execution.

1)   Direct Purchase – Applicant will purchase the new truck(s) with own funds or obtain a loan from a bank to purchase the new truck(s).  The applicant will be the registered owner of the new truck(s) and is responsible for complying with the operating and reporting requirements of the Program.
a. Standard Grant Agreement (PDF, 256KB)
b. Standard Purchase Statement of Work (PDF, 150KB)

2)      Lease-To-Own Programs:

a) LMC model – The Licensed Motor Carrier (LMC) will purchase the new truck(s) and then enter into a lease agreement with the truck operator.  The LMC will be the registered owner of the new truck.  The LMC will enter into an agreement with the AQMD, accepting overall responsibility for implementation of the project, including operating and reporting requirements. The truck operator will serve as the lessee, and will also be responsible for complying with the operational requirements of the Proposition 1B Program.  The lease must be with the driver of the old truck, unless the old truck was owned by the LMC.  This contract model includes two documents: an agreement with the LMC as the Lessor, and a Lease Rider which must be included in the lease agreement between the LMC and the lessee.
1. CSS.LMC Agreement (PDF, 280KB)
2. LMC Lease Statement of Work (PDF, 159KB)
3. Lease Rider (PDF, 77KB)

b) Bank model – The bank will purchase the new truck(s) and serve as the Lessor directly to the lessee.  The LMC will enter into an agreement with the AQMD and will be responsible for administering the operational and reporting requirements of the Proposition 1B Program.  The bank will be the registered owner of the new truck(s).  The 1099 will be issued to the bank. There are two agreements under this model: one with the bank as the Lessor, and the other agreement with the LMC as the Administrator. There is also a Lease Rider which must be included in every lease agreement between the bank and the lessee.
1. Agreement with Lessor-CC2 (PDF, 275KB)
2. Bank Lease Statement of Work (PDF, 151KB)
3. Lease Rider (PDF, 77KB)
4. Agreement/Administrator - coming soon
5. Lease Statement of Work-Administrator (PDF, 156KB)

Background

Proposition 1B, the wide-reaching transportation bond voters approved in 2006, included one billion dollars to fund projects that reduce air pollution associated with freight movement along California’s trade corridors. The first $25 million of that funding was allocated by the California Air Resources Board (CARB) in February 2008 to “jump start” the program and fund projects that are ready for quick implementation.  The AQMD received $13.8 million of the “early grant” funds and used these funds to implement a successful truck replacement program in the region.  A total of 263 heavy-duty diesel trucks were replaced under the early grant reducing emissions by 10.5 and 209 tons per year of PM and NOx, respectively.  Concurrent reductions in greenhouse gas emissions were also achieved by at least 50% of the projects which involved replacing a diesel truck with an LNG-fueled truck.

Statewide Proposition 1B Funding Targets

• $400 Million for Heavy Duty Diesel Trucks Serving Ports and Intermodal Facilities
• $360 Million for Other Heavy Duty Trucks
• $100 Million for Shore Power for Cargo Ships at Berth, and Cargo Handling Equipment
• $100 Million for Diesel Freight Locomotives
• $40 Million for Commercial Harbor Craft

For additional information or questions, please contact Mei Wang at (909) 396-3257 or mwang@aqmd.gov

AQMD Board Actions Regarding Prop 1B Funding

Copies of Governing Board letters can be viewed by clicking on the following items.

• May 2, 2008 Board Letter recognizing $13.8 million in Prop 1B funds and executing contracts to replace heavy duty diesel trucks
• July 11, 2008 Board Letter recognizing additional Prop 1B funds and amending early grant awards.
• Competitively ranked priority lists of projects approved in the May 2 and July 11, 2008 Board Letters:
  1. Trucks serving ports and intermodal railyards (Grant Number G07GMLP1)
     Ranked Priority List #1 dated Oct. 2, 2008 (PDF, 69KB)
     Ranked Priority List #2 dated Nov.17,2008 (PDF, 26KB)
     Ranked Priority List #3 dated Jan. 6, 2009 (PDF, 66KB)
     • Financial and other required information pertaining to the lease-to-own program for the trucks serving the ports and intermodal railyards (PDF, 10KB)
  2.  Other heavy duty diesel trucks (Grant Number G07GMLT1) (PDF, 27KB)
• March 6, 2009 Board Letter
• September 11, 2009 Board Letter
• November 6, 2009 Board Letter
• June 4, 2010 Board Letter
• Competitively ranked priority lists of projects approved in the March 6, September 11, 2009, November 6, 2009, June 4, 2010, and December 3, 2010  Board Letters:
  1. Trucks serving ports and intermodal railyards (Grant Number G07GMLP2)
     Ranked Priority List Solicitation 1 (PDF, 21KB)
     Ranked Priority List Solicitation 2 (XLF, 41KB) updated 10-20-10
  2. Trucks Serving Port of Los Angeles and Port of Long Beach (Grant Number G07GMLP3-03)
     Ranked Priority List, Tier 1 (PDF, 350KB)
     Ranked Priority List, Tier 2 (PDF, 16KB)
     Ranked Priority List, Tier 3 (PDF, 119KB) updated 10-6-10
     Ranked Priority List, Backup (PDF, 41KB) updated 10-6-10
  3. Other trucks and truck stop/distribution centers (Grant Number G07GMLT2)
     Ranked Priority List (PDF, 211KB) updated 8-25-10
     Ranked Priority List, Backup (PDF, 201KB) new 12-10-10
• November 4, 2011 Board Letter with errata sheet (PDF, 313KB)
• December 2, 2011 Board Letter (PDF, 51KB)
• On November 4 and December 5, 2011, AQMD’s Governing Board approved the expenditure of “Year 2” Proposition 1B – Goods Movement Emission Reduction Program funds for eligible heavy-duty diesel truck projects. The Board letter specifies that the list of eligible projects is contingent upon CARB’s approval of a final rank list. Below is the final rank list approved by CARB for Grant No. G08GMLT1:
  
  1. Truck (Solicitation PA 2011-11) Ranked List (PDF, 465 KB) new 11-17-11
     
  In accordance with the program requirements, AQMD will fund projects in the order of CARB’s final approved rank list until all program funds are exhausted.

On May 22, 2008, the CARB Board approved the allocation of approximately $24 million to the AQMD from the remaining $225 million budgeted for FY 2007-2008.  Additionally, the CARB Board allocated $98 million to the Ports of Los Angeles and Long Beach.  In total, the South Coast region received 55% of the FY 2007-08 funds.  Over the four year period, the South Coast region will receive 55% of the total $1 billion in Prop 1B funding.

Click here to go to ARB's web site for their documents regarding Prop 1B (Goods Movement Emission Reduction Program).