BOARD OF AIRPORT COMMISSIONERS

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1 A VIM KV 0" 11 Los Angeles World Airports REPORT TO THE BOARD OF AIRPORT COMMISSIONERS 7.F.700 Meeting Date: Approved fr 4; ell Lewis, Director of.maintenance Services 4/19/2018 Review Michael R. Christensen, uty Executive Director CAO Review: X Completed Pending N/A Reviewed for Date Approval Status Finance 4/6/2018 ClY E N NA RW I3eborah Flint Chief Executive Officer CEQA 3/29/2018 N JH Procurement 4/3/2018 NY EN Cond MT Guest Experience 4/4/2018 MY EN BY Strategic Planning 3/29/2018 EN N NA 1 SUBJECT: Contract Award to BYD Coach and Bus LLC Award a contract to BYD Coach and Bus LLC for the purchase of twenty 60-foot articulating, battery-electric airfield buses for the Bus Operations Division at Los Angeles International Airport, for a total amount not to exceed $23,705,200. RECOMMENDATIONS: Management RECOMMENDS that the Board of Airport Commissioners: 1. ADOPT the Staff Report. 2. DETERMINE that this action is exempt from the California Environmental Quality Act (CEQA) pursuant to Article II, Section 2.f of the Los Angeles City CEQA Guidelines. 3. APPROVE the award of a contract to BYD Coach and Bus LLC for the purchase of twenty 60-foot articulating, battery-electric airfield buses for Bus Operations Division at Los Angeles International Airport, for a total amount not to exceed $23,705, APPROPRIATE capital funding for the purchase of the buses in the amount of $23,705, FIND New Flyer of America's bid non-responsive for not adhering to the technical specifications of the bid documents. Page 1

2 6. AUTHORIZE the Chief Executive Officer to execute the contract after approval as to form by the City Attorney. DISCUSSION: 1. Purpose To provide replacement, zero-emission airfield buses for the Bus Operations Division at Los Angeles International Airport (LAX) in order to transport airline passengers and crews between the various terminals and gates and to reduce LAX's environmental impact in the region by reducing bus tailpipe emissions. 2. Prior Related Actions June 4, Resolution No (DA-3135) The Board of Airport Commissioners (Board) authorized the Department of Airports' Executive Director to execute a contract with Mercury Ground Service Equipment, on behalf of Contrac GMBH, for the purchase of six diesel-fueled airfield buses and authorization to exercise the option to purchase up to six additional diesel-fueled airfield buses to be used at LAX for an overall contract amount not to exceed $3,467,820. November 5, Resolution No (DA-3175) The Board authorized the Department of Airports Executive Director to execute a contract with Mercury Ground Service Equipment, on behalf of Contrac GMBH, for the purchase of three replacement diesel-fueled airfield buses to be used at LAX, with the same terms and conditions pursuant to Contract No. DA-3135, for an overall contract amount not to exceed $1,315, March 21, Resolution No (DA-4021) The Board authorized the Department of Airports' Executive Director to execute a contract with North American Bus Industries, Inc. for the purchase of six low floor, 60- foot articulating airfield buses fueled by compressed natural gas (CNG) and authorization to exercise the option to purchase up to six additional buses to be used at LAX for an overall contract amount not to exceed $4,280, Current Action LAWA's Facilities Maintenance and Utilities Group (FMUG), Maintenance Services Division (MSD) maintains, repairs, and replaces the equipment and vehicles in LAWA's fleet. The Bus Operations Division (Bus Ops) provides transportation services on the Airfield Operations Area on a 24-hours a day, 7 days a week basis for the traveling public whose flights are displaced from common use gates. This includes transfers between terminals and gates, remote terminals or pad areas. In calendar year 2017, Bus Ops transported in excess of 2.4 million passengers in over 53,000 bus trips.bus Ops also responds to all aircraft incidents and provides support during most aircraft incidents. Page 2

3 The airfield bus fleet consists of 26 buses: fourteen diesel-fueled buses that are over twenty years old and twelve CNG-fueled, 60-foot articulating buses that are over ten years old. Through this action, MSD will replace all fourteen diesel-fueled buses with electric buses and add six electric buses to the airfield bus fleet. The six additional buses are required to meet the demand of the increasing number of requests for airfield busing. Bus Ops' current 2018 metrics project at least a 10% increase for the current calendar year. The six additional buses will provide a fleet of 32 buses to meet current peak demands, especially during the summer months. Providing a complement of twenty electric buses to the existing fleet will enable MSD and Bus Ops to analyze the effectiveness of an all-electric fleet in anticipation of the Midfield Satellite Concourse opening. This, coupled with the expiring tanks on the twelve CNG buses, will enable Bus Ops to examine a reduction in the overall fleet within the next three years. Electric buses generate zero tailpipe emissions and produce less noise than their dieseland CNG-fueled counterparts. Consequently, this will lead to a much improved carbon footprint at LAX. Conventional internal combustion engines generate oxides of nitrogen (NOx), a significant source of air pollution. LAWA's diesel-fueled buses have a NOx emissions factor of 4.3 grams per brake horsepower-hour (g/bhp-hr), exceeding the current State of California NOx standard of 0.2 g/bhp-hr by a factor of over 20. Moreover, staff's research indicates that replacing the diesel-fueled buses with batteryelectric buses will reduce NOx emissions by 4,830 pounds or 2.4 tons per year. LAWA would also see an annual reduction in total hydrocarbons (225 pounds), carbon monoxide (786 pounds) and particulate matter (90 pounds). Furthermore, replacement of the diesel-fueled buses will yield a reduction in carbon dioxide or greenhouse gas (GHG) emissions. According to the U.S. Environmental Protection Agency, the carbon dioxide emissions factor for diesel fuel is pounds per gallon. Considering LAWA's diesel-fueled buses consume an annual average of 27,541 gallons, this equates to a reduction of 616,365 pounds, or 308 tons of GHG per year. In addition, because battery-electric buses have fewer moving parts than diesel and CNGfueled buses, they need less maintenance. Energy costs for recharging these electric buses will also likely be far less than their diesel or CNG counterparts. This will reduce LAWA's total cost of ownership. Several California public agencies have or are in the process of procuring electric buses include, but not limited to, Los Angeles County Metropolitan Transportation Authority, City of Los Angeles Department of Transportation, Antelope Valley Transit Authority, San Diego Metropolitan Transit System, Foothill Transit, Santa Barbara Metropolitan Transit Authority, San Jose International Airport, Sacramento International Airport, and University of California at San Francisco. Infrastructure required to charge the buses procured under this request will be purchased and installed by FMUG. FMUG will install the chargers in the locations identified by the Planning and Development Group (PDG). Funding for the installation of the charging Page 3

4 infrastructure will be included in the FY 2018/19 Capital Improvement Program. A total of fifteen electric bus chargers will be installed in Remain Over Night Positions, remote gates 210, 212, and 216, Presidential Gates 206/08 and 207/09, and in the MSD yard. The estimated cost for this project is between $2.3 and $2.6 million and may qualify for partial grant funding. How this action advances a specific strategic plan goal and objective This action advances this strategic goal and objective: Sustain a Strong Business: Operate sustainability - balancing economic, social and environmental responsibilities. The replacement of the 20-year old diesel-fueled buses with new battery-electric buses will vastly reduce the amount of emissions generated by the airfield bus fleet (particularly NOx by over 2.4 tons per year, and GHG by over 308 tons per year), improving the air quality in and around LAX, and in keeping with the City of Los Angeles' Sustainable City plan to green the City's fleet to reduce the use of traditional fuels. Procurement Process To establish a contract, staff posted a Request for Bid (RFB), No on October 20, 2017 for public view on the City of Los Angeles website to solicit offers from qualified manufacturers, initially for fifteen buses. LAWA received responses from two bidders (BYD Coach and Bus LLC and New Flyer of America) by the due date of March 15, 2018, however, staff concluded only one bid to be responsive, as it met all of LAWA's specifications: Vendor Bid Early Payment Discount LBPP Preference 8% Evaluation Bid Amount BYD Coach and Bus LLC $16,009,125 $0.00 ($1,280,730) $14,728,395 New Flyer of America (nonresponsive) $20,054,625 $0.00 $0.00 $20,054,625 Staff deemed New Flyer of America's (NFA) bid as non-responsive. During the bid process, NFA submitted requests for clarification and deviations regarding the RFB and bus specifications. Staff reviewed NFA's requests and posted addenda to the RFB in response requesting that NFA adhere to the specifications. Nevertheless, NFA's bid still included requests for deviations that did not meet specifications leaving BYD Coach and Bus LLC (BYD) as the sole responsive bidder. Staff's research indicated that BYD and NFA are the only companies that manufacture a 60- foot road-legal, battery-electric articulating bus. Therefore, staff did not expect to receive bids from any other company. Although RFB No called for fifteen battery-electric buses with an option to purchase fifteen additional battery-electric buses, staff requests to purchase twenty buses. BYD confirmed that they are still able to provide them at the same price per bus as their bid for fifteen buses. Page EV Buses- BOARDREPORT.docx

5 The costs break down as follows: Action Requested Cost per bus: $ 1,067, Additional wheelchair ramps: (two per bus) $ 15, Subtotal: $ 1,082, x 20 buses: $21,648, Sales tax: $ 2,056, Grand Total: $23,705, (rounded up) Staff requests that the Board authorize the Chief Executive Officer to execute a contract with BYD Coach and Bus LLC for the purchase of twenty 60-foot articulating, battery electric airfield buses, for Bus Ops at LAX for a total amount not to exceed $23,705,200. Fiscal Impact The costs associated with this contract will be recovered through landing fees and/or terminal rates and charges, as well as revenues from non-airline related facilities. Funding for additional buses, if needed, will be requested through a separate Board action. In addition, LAWA may apply for the California Air Resources Board's Hybrid and Zero- Emission Truck and Bus Voucher Incentive Project (HVIP). The vouchers would reduce the price of each electric bus by $190,000. HVIP also offers a voucher enhancement of $10,000 per bus for a fleet's first three buses. Consequently, HVIP will save LAWA a total of $3,830,000. The vouchers are applied at the point of sale, which means BYD would deduct the amount of the vouchers from the total price of the buses. 4. Alternatives Considered Leasing Staff analyzed the option of leasing versus buying and determined that leasing did not offer any advantages over purchase. The cost to lease for terms at interest rates of 6- years at 6.5% and 12 years at 8.5% added at minimum $300,000 to the cost of each bus and as much as $700,000 if financed for a longer period. Leasing would result in the same lead time for ordering the buses as the buses would have to be built to our specifications for airfield use. Also, per Risk Management, leasing is more suitable to infrequent use of the vehicle, low mileage, and low exposure to frequent damage. Take No Action Staff does not recommend taking no action on this item as it would result in a less than acceptable level of buses scheduled for replacement for Bus Ops. Additionally, the current airfield buses need more frequent maintenance and repairs due to their age and have a much higher emissions profile. Page 5

6 Join another Government Contract Other government contracts that staff researched provide for transit-style buses that do not meet Bus Ops' requirements. Thus, joining another government contract is not feasible. APPROPRIATIONS: Staff requests that funds in the not-to-exceed amount of $23,705,200 be appropriated and allocated from the LAX Revenue Fund to WBS Element A-700 (Electric Airfield Bus Program) as may be required. STANDARD PROVISIONS: 1. This action, as a continuing administrative activity, is exempt from California Environmental Quality Act (CEQA) requirements pursuant to Article II, Section 2.f of the Los Angeles City CEQA Guidelines. 2. The City Attorney has approved this item. 3. Actions taken on this item by the Board of Airport Commissioners will become final pursuant to the provisions of Los Angeles City Charter Section This action is not subject to the provisions of the Living Wage/Service Contractor Worker Retention Ordinances. 5. Procurement Services has reviewed this action (File No ). No mandatory Small Business Enterprise, Local Business Enterprise/Small Local Business Enterprise, and Disabled Veterans Business Enterprise goals were set for this project, as no subcontracting opportunities were identified. However, BYD Coach and Bus LLC is a certified Local Business Enterprise firm. 6. BYD Coach and Bus LLC will comply with the provisions of the Affirmative Action Program. 7. BYD Coach and Bus LLC must obtain and submit a Business Tax Registration Certificate number prior to execution of the contract. 8. BYD Coach and Bus LLC will comply with the provisions of the Child Support Obligations Ordinance. 9. BYD Coach and Bus LLC will have approved insurance documents, in the terms and amounts required, on file with Los Angeles World Airports prior to issuance of a Notice to Proceed. 10. This action is not subject to the provisions of Charter Section 1022 (Use of Independent Contractor). Page EV Buses-BOARDREPORTdocx

7 11. BYD Coach and Bus LLC has submitted the Contractor Responsibility Program Questionnaire and Pledge of Compliance and will comply with the provisions of the Contractor Responsibility Program. 12. BYD Coach and Bus LLC must be determined by Public Works, Office of Contract Compliance to be in full compliance with the provisions of the Equal Benefits Ordinance prior to execution of the contract. 13. This action is not subject to the provisions of the First Source Hiring Program. 14. BYD Coach and Bus LLC has submitted the Bidder Contributions CEC Form 55 and will comply with its provisions. Page EV Buses-BOARDREPORTdocx

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