HomeMy WebLinkAboutItem 6f. Authorization to increase appropriation for Battery Electric Buses Item 6f
Department: Public Works
Cost Center: 5021
For Agenda of: 7/11/2023
Placement: Consent
Estimated Time: N/A
FROM: Matt Horn, Public Works Director
Prepared By: Austin O’Dell, Interim Transit Manager
SUBJECT: AUTHORIZATION TO INCREASE APPROPRIATION FOR BATTERY
ELECTRIC BUSES
RECOMMENDATION
Adopt a Draft Resolution entitled, “A Resolution of the City Council of the City of San Luis
Obispo, California, authorizing the appropriation of additional undesignated Transit Fund
balance for battery electric buses.”
POLICY CONTEXT
This project is consistent with the City’s adopted 2023-25 Financial Plan Major City Goal
for Climate Action, Open Space, & Sustainable Transportation. The project is also
consistent with the City’s Climate Action Plan, 2017-22 Short Range Transit Plan, the
SLO Regional Zero Emission Bus Plan, and the State of California’s Innovative Clean
Transit Rule.
DISCUSSION
In 2021, the City of San Luis Obispo and the San Luis Obispo Regional Transit Authority
(SLORTA) submitted a joint discretionary grant application for Federal Transit
Administration (FTA) 5339(b) funding to purchase 11 battery electric buses. The grant
includes six battery electric buses for SLO Transit and five battery electric buses for
SLORTA. The intent of the application is to assist both agencies’ needs to comply with
the State of California’s zero emission bus mandate. SLORTA served as lead for the grant
application.
The project funding was identified and approved by Council with the 2021 -23 Financial
Plan adoption based on the grant application funding split needed to purchase the six
battery electric buses. SLORTA was notified in March 2022 that the application was
approved and that the FTA awarded funds to SLORTA and to the City for the 11 buses.
Page 213 of 465
Item 6f
Cooperative Procurement Agreements
Washington State and the State of California offer cooperative procurement agreements
and can serve as lead agencies for bus procurement. The lead agencies have satisfied
the federal competitive procurement process which allows eligible agencies to participate
in cooperative agreements without the need to solicit for proposals. The City’s Municipal
Code section 3.24.060(E) allows for direct purchasing when the purchase is made
cooperatively with one or more government agencies in place of the City’s bid procedures
which typically must be followed for these types of purchases. Participating in cooperative
procurements reduces staff time and resources required to solicit for and execute
separate procurement agreements.
In 2021, the City used the California battery electric bus cooperative procurement
agreement to purchase one battery electric bus from New Flyer and one battery electric
bus from Proterra. The purpose of purchasing vehicles from two different manufacturers
was to allow staff to evaluate the buses and determine which manufacturer would be best
for future purchases since the City did not have any experience with buses from these
two manufacturers. These buses are expected to go into service in July 2023.
At the time of purchasing the two new battery electric buses, a third manufacturer, Gillig,
was not considered as a potential supplier because they were not included in the State
of California’s cooperative procurement agreement. Gillig is, however, included in the
State of Washington’s cooperative procurement agreement which the City can also use
for bus replacement purchases.
Staff collected quotes from Proterra and New Flyer from the California State cooperative
agreement and Gillig from the Washington State cooperative agreement for the purchase
of the remaining six battery electric buses. Staff reviewed quotes, vehicle specifications,
and determined that acquiring buses fro m Gillig represents the best value and fit for the
City’s transit service, SLO Transit’s, needs. New Flyer’s quoted price was significantly
more than the other two, so staff compared configuration specifications for only Proterra
and Gillig.
Staff compared over 160 items from Proterra’s and Gillig’s bus configuration
specifications and rated each item on a one (lowest) to five (highest) scale. More points
were awarded based on whether the item was required or optional, whether the item was
configurable or fixed, and how closely it can be configured to match the vehicles in SLO
Transit’s existing fleet. Gillig scored much higher with 425 points awarded compared to
376 for Proterra.
Need for Additional Funding
Since grant funding was awarded and the cooperative agreements were analyzed,
vehicle production costs for all manufacturers have increased significantly. Gillig, LLC
provided an updated quote on May 4, 2023 (Attachment A) indicating a 10.8% increase
in costs for the battery electric buses configured to the City’s specifications. The updated
costs result in a deficit of $278,521 in current project funding as shown in Table 1.
However, the funding gap can be filled by the Transit Fund’s undesignated fund balance.
Page 214 of 465
Item 6f
Table 1: Battery Electric Bus Purchase Funding
Project No. 2000505 Funding
Current Funding $ 6,632,843
Gillig Quote (May 4, 2023) $ 6,911,364
Surplus / (Deficit) $ (278,521)
6% Contingency $ 414,682
Proposed Additional Funding $ 693,203
The additional funding also includes a six percent contingency to cover future
unanticipated costs associated with the purchase of the six battery electric buses. The
contingency amount is based on trends in periodic manufacturing cost increases since
the onset of the COVID-10 pandemic. This report recommends adoption of a Draft
Resolution (Attachment B) authorizing the appropriation of $693,203 from T ransit Fund’s
undesignated fund balance to the project account for C apital Improvement Plan (CIP)
Project 2000505 as well as other administrative actions necessary to complete the
purchase.
Previous Council Action
This project was identified and approved by Council as part of the 2021-23 Financial Plan
adoption.
Public Engagement
This is an administrative item, so no outside public engagement was completed. Public
comment can be provided to the City Council through written correspondence prior to the
meeting and through public testimony at the meeting.
CONCURRENCE
This proposed action has the concurrence of the Administration Department’s Office of
Sustainability and is in alignment with the City’s Fleet Replacement Policy which
prioritizes active transportation and electric fuel source vehicles over gas- and diesel-
powered fleet vehicles.
ENVIRONMENTAL REVIEW
The recommended action is not considered a “Project” under California Environmental
Quality Act (CEQA) Guidelines Section 15378.
FISCAL IMPACT
Budgeted: Yes Budget Year: 2022-23
Funding Identified: Yes
Page 215 of 465
Item 6f
Fiscal Analysis:
Funding Sources
Total Budget
Available
Current
Funding
Request
Remaining
Fund
Balance
Annual
Ongoing
Cost
Transit Fund (Fund Balance) $ 9,686,258 $ 693,203 $ 8,993,055
State Grants (TDA) $ 1,326,568
Federal Grants (FTA
5339(b)) $ 4,799,978
Federal Grants (FTA 5307) $ 506,296
Total $ 6,632,843 $ 693,203 $ 8,993,055
The project was identified and approved with the adoption of the 2021 -23 Financial Plan
prior to the FTA awarding funds. The initial project cost estimate was based on the grant
application split between the two agencies and was conservative compared to actual
funding awarded to the City.
The State Grants for this purchase constitute the local match required for federal grant
funding and are comprised of Transportation Development Act (TDA) funding. The
Federal Grants for this purchase are comprised of Federal Transit Administration (FTA)
5339(b) funding and FTA 5307 funding. Both Federal and State Grants were programmed
by the San Luis Obispo Council of Governments (SLOCOG) to assist with the purchase.
The gap between the purchase price of the six battery electric buses and the Federal and
State Grant funds are planned to be filled using Transit Fund balance. The recommended
additional funding also includes a six percent contingency to cover future unanticipated
expenses. Funds for this appropriation are available from the Transit Fund’s
undesignated fund balance which forecasted to be $9,686,258 by the end of the 2022-23
fiscal year.
ALTERNATIVES
Deny authorization to increase appropriation request. Council could choose not to
increase the appropriations for the purchase of the six-battery electric bus. Staff does not
recommend this action because the City will not be able to purchase the buses in
accordance with the state mandate and it would jeopardize federal grant funds that cannot
be spent on other projects.
ATTACHMENTS
A - Gillig, LLC cost quote - May 4, 2023
B - Draft Resolution Authorizing Transfer of Additional Transit Funds
Page 216 of 465
May 4, 2023
Mr. Austin O’Dell
Transit Manager
City of San Luis Obispo
919 Palm Street
San Luis Obispo, CA 93401
Dear Mr. O’Dell,
Thank you for your interest to purchase two (2) 35’ Low Floor Plus Battery Electric Buses
and four (4) 40’ Low Floor Plus Battery Electric Buses through the State of Washington
RFP#2020 06719-01.
Attached you will find the State of Washington RFP price tabulation that would pertain to
the City of San Luis Obispo order. GILLIG is pleased to quote the following:
TWO (2) 35’X102” LOW FLOOR BATTERY ELECTRIC BUSES $1,147,316.00 EA
FOUR (4) 40’X102” LOW FLOOR BATTERY ELECTRIC BUSES $1,154,183.00 EA
This price is valid through July 2023. Prices exclude registration and license fees but does
include CA Sales Tax (8.75% adjusted to 4.8125%). The production of your buses can
be scheduled within 20-22 months from receipt of purchase order. To maintain this
production schedule, we will require a firm purchase order by the end of July.
We thank you for this opportunity and appreciate your interest in GILLIG and our products.
We certainly look forward to working with City of San Luis Obispo and in so doing,
continuing to build our long-term partnership. Should you have any questions, please do
not hesitate to contact me.
Sincerely,
Sean Solis
Sean Solis
Regional Sales Manager
cc: William F. Fay, Jr.
Javier Hernandez, Jr.
Page 217 of 465
Page 218 of 465
R ______
RESOLUTION NO. _____ (2023 SERIES)
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN LUIS
OBISPO, CALIFORNIA, AUTHORIZING THE APPROPRIATION OF
ADDITIONAL UNDESIGNATED TRANSIT FUND BALANCE FOR
BATTERY ELECTRIC BUSES
WHEREAS, the City of San Luis Obispo operates the San Luis Obispo (SLO)
Transit system; and
WHEREAS, in 2021, the City of San Luis Obispo and the San Luis Obispo
Regional Transit Authority (SLORTA) submitted a joint discretionary grant application for
Federal Transit Administration (FTA) 5339(b) funds for the purchase of eleven battery
electric buses; and
WHEREAS, in 2022, the Federal Transit Administration approved the grant
application; and
WHEREAS, the City of San Luis Obispo received the amount of $4,799,978 for six
battery electric buses from the FTA 5339(b) grant; and
WHEREAS, the City of San Luis Obispo received the amount of $506,296 from
FTA 5307 formula funds to supplement the FTA 5339(b) grant; and
WHEREAS, the City of San Luis Obispo is using Transportation Development Act
(TDA) state grant funding for the local match amount of $1,326,568; and
WHEREAS, Municipal Code section 3.24.060(E) allows for direct purchasing when
the purchase is made cooperatively with one or more government agencies; and
WHEREAS, staff identified a Washington State transit bus cooperative purchasing
agreement which meets the federal procurement requirements, compared battery electric
vehicle manufacturer specifications, pricing, and determined manufacturer Gillig, LLC to
be the best fit for the City of San Luis Obispo’s transit needs ; and
WHEREAS, vehicle productions costs have increased significantly since the grant
application was submitted in 2021; and
WHEREAS, additional funding in the amount of $693,203 is required to fund the
purchase battery electric buses, as specified in the grant application, using the
Washington State transit bus cooperative purchasing agreement; and
WHEREAS, the Transit Fund has sufficient undesignated fund balance to cover
the additional funding needed.
Page 219 of 465
Resolution No. ____ (2023 Series) Page 2
R ______
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of San
Luis Obispo does hereby authorize the following:
1. Authorize the Finance Director to appropriate $693,203 from undesignated
Transit Fund balance to the Capital Improvement Plan (CIP) Project account
2000505 via Budget Amendment Request (Exhibit A); and
2. Authorize the Public Works Director to prepare, file, secure assurances and
concurrences, submit necessary documents associated with, and other
necessary actions for the purchase of the six battery electric buses.
Upon motion of ______________, seconded by ________________, and on the
following roll call vote:
AYES:
NOES:
ABSENT:
The foregoing resolution was adopted this ______ day of _____________, 2023.
________________________________
Mayor Erica A. Stewart
ATTEST:
________________________
Teresa Purington
City Clerk
APPROVED AS TO FORM:
________________________
J. Christine Dietrick
City Attorney
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the
City of San Luis Obispo, California, on ______________________.
________________________________
Teresa Purrington
City Clerk
Page 220 of 465
Resolution No. ____ (2023 Series) Page 3
R ______
EXHIBIT A
Department Fiscal Year
Public Works 2023
Fiscal Officer Date
Nicole Lindner 6/29/2023
Department Head Date
Matt Horn
Fund Cost Center Account Amount
-
Fund Cost Center Account Amount
621 9501 71006 693,203.00
693,203.00
Fund Cost Center Account Amount
621 0000 32001 (693,203.00)
(693,203.00)
Project Title Award Project Fund Task Amount
Fleet replacement Transit 6 Gillig Buses 2000505 Transit 0 693,203.00
693,203.00
Budget Analyst Date
Finance Director (if Necessary)Date
Posted By Process ID Date Period
Transit unassigned fund balance
BUDGET AMENDMENT REQUEST
PROJECTS AND AWARDS
EXPENDITURES AND TRANSFERS OUT
REVENUES AND TRANSFERS IN
PURPOSE
On 7/11/2023 council approved the appropriation of $693,203 from Transit Fund’s undesignated fund balance to the project account for Capital Improvement Plan
(CIP) Project "Fleet replacement Transit 6 Gillig Buses" 2000505.
CHANGE TO FUND BALANCE, WORKING CAPITAL OR DESIGNATION
Cost Center and Account Title
Cost Center and Account Title
Account Title
Transit Fund
Page 221 of 465
Page 222 of 465