HomeMy WebLinkAbout31-Public Services RiGINfL
CITY OF SAN BERNARDINO - REQUEST FOR COUNCIL ACTION
From: Ken Fischer, Director Subject: Resolution authorizing the
execution of an Amendment and
Dept: Public Services increase to Contract Purchase Order
#08-070, with three single year renewal
Date: April 9, 2008 options to Applied LNG Technologies
pursuant to Section 3.04.010 B-3 of the
Municipal Code for the purchase of LNG
fuel.
Meeting Date: April 21, 2008
Synopsis of Previous Council Action
Reso 2008-48 February 4, 2008 Approved $75,000 increase to annual PO
April 7, 2008 Approved $50,000 increase to annual PO. Item continued to April
21, 2008 Council meeting, referred to Ways and Means Committee
for review.
Recommended Motion: e
Adopt Resolution.
S' re
Contact person Don Johnson, Fleet Manager Phone: 5220
Supporting data attached: Staff Report,
Quote, Resolution, Agreement, and Amendment.
Ward: All
FUNDING REQUIREMENTS:
Amount: $100,100
Source: 635-341-5113
Motor Fuel &
Lubricants
Finance:
Council Notes: cSo X008 - /3
aI o8
Agenda Item No. b I
CITY OF SAN BERNARDINO — REQUEST FOR COUNCIL ACTION
Staff Report
Subject:
Resolution authorizing the execution of an Amendment and increase to Contract
Purchase Order #08-070, with three single year renewal options, to Applied LNG
Technologies pursuant to Section 3.04.010 B-3 of the Municipal Code for the purchase
of LNG fuel.
Background:
Applied LNG Technologies is the company that supplied the first load of fuel to our new
LNG station (Station). Since Applied LNG Technologies is most familiar with our
Station, staff issued an interim contract purchase order in the amount of $24,900 to
purchase LNG fuel until staff could seek bids for a long-term contract. Unfortunately, it
took longer than anticipated to resolve the minor technical issues associated with the
construction and commissioning of the Station, and on February 4, 2008 resolution
#2008-48 was approved by the Mayor and Common Council increasing the purchase
order by $75,000. On April 7, 2008 a $50,000 increase was approved, the item was
referred to the Ways and Means Committee for review and continued to the April 21,
2008 meeting of the Mayor and Common Council.
There are only two available vendors able to supply LNG fuel. Fleet staff has been in
contact with both vendors and requested quotes for a long term contract for LNG fuel
supply and station maintenance, the results are as follows:
Applied LNG Technologies is proposing an initial charge of $1.43 per gallon including
freight, subject to monthly adjustment pursuant to a regional petroleum pricing index.
The proposed preventive maintenance contract is $750.00 per month, which is $9,000
per year. This covers monthly inspections and all preventive maintenance required by
the station manufacturer. Field service labor for repairs is $100 per hour plus parts
costs, so the City would only pay for each repair throughout the year (see attached
contract/maintenance agreement attachment 2). The estimated annual station
maintenance cost per the manufacturer is $40,000.
Clean Energy is proposing to charge $1.34 per gallon including a diesel surcharge of
$0.001 per gallon for delivery, subject to monthly adjustment pursuant to a regional
petroleum pricing index. Their preventive maintenance proposal appears to be an all-
inclusive price based on a $0.15 per gallon of LNG fuel pumped but excludes three of
the major components of the station. The City's fleet currently uses approximately 1200
gallons per day (1200 x 0.15) = $180 per day. Fuel usage is expected to double to
Staff Report — Continued
2400 gallons per day when sixteen (16) new LNG vehicles arrive by the end of the fiscal
year. This will raise the daily maintenance cost to $360 per day. IWM operations run
six (6) days a week, so we can expect to pay around $9,000 per month. This cost
would rise as more fuel is pumped from the station, as it is now open to other fleets as
well as the public. Attached for your review is a spreadsheet comparing both proposals
with a conservative estimate of future fuel usage.
Fuel costs proposed by Applied LNG and Clean Energy are similar. However, the
disparity between their proposed maintenance costs leads staff to recommend a multi-
year contract award to Applied LNG Technologies for LNG fuel supply beginning in FY
07/08 and station maintenance beginning in December of FY 08/09 when the station
construction warranty period is completed. In order to allow the City vehicles and the
public to fuel without interruption at our Station, staff is seeking approval of an
amendment that includes three (3) single year renewal options and an increase to the
purchase order amount by an additional $100,100 for a total of $250,000 for the
remainder of FY 07/08.
On April 9, 2008 at the regularly scheduled Ways & Means Committee meeting this item
was reviewed. Staff presented its recommendations and methodology showing how the
bids were solicited and reviewed to determine who was the lowest responsive bidder.
Both vendors were present and gave a brief presentation to the Ways and Means
Committee. Committee members questioned both vendors and staff prior to any
recommendations. The Committee members voted to recommend award of the
contract to Applied LNG Technologies and referred the item back to the full Council for
approval at the April 21, 2008 meeting of the Mayor and Common Council.
Financial Impact:
Funds for this purchase are available in the FY 07-08 Account No. 635-341-5113,
Motor Fuel & Lubricants.
Recommendation:
Adopt Resolution.
CLEAN ENERGY
®rm-'$/LNG Fuel Maintenance Fu " Main en ,c�;.
Priced Per Gallon Yearly Flat Rate
Based on 2,400 Based on$750.00
gallons per day @ per month
0.15 per gallon Preventative
Annual Cost is Maintenance
April 2008 Natural Gas $120,960.00 Annual cost
Commodity Price $0.726 0.726 $9,000
CE's station On site repair labor
maintenance rate$100.00 per
pricing excludes hour. Materials are
costs associated cost plus 15% as
with 3 major needed per each
components, card repair.
reader
system,CNG
dispenser video
panel and LNG
pump rebuilds
Liquefaction loss factor $0.00 $0.14
Delivery Price Per
Gallon $0.62 $0.45
Freight $0.00 $0.12
Diesel Surcharge
($11.54/9,000 gallons $0.001 $0.000
Total $1.347 $1.438
Annual Maintenance
Cost $120,960.00 9,000
Estimated Annual "Station
Repair Cost manufacturer
estimates$40,000
$0.00 annual repair cost
Annual Fuel Usage $1,086,220.80 1,161,216.00
Total Fuel &
Maintenance Cost $1,207,180.80 $1,170,216.00
Clean Energy ALT
Daily Fuel Use 2,400 X$1.347=$3,232.80 Daily Fuel Use 2,400 X$1.44=$3,456.00
Monthly Fuel Use$3,232.80 X 28 days=$90,518.40 Monthly Fuel Use$3,456.00 X 28 days=$98,768.00
Annual Fuel Use$90,581.40 X 12 months= 1,086,220.80 Annual Fuel Use 98,768.00 X 12 Months= 1,161,216.00
Projected Fuel usage increase 600 gallons daily
Clean Energy 151,200.00 Annual Maintenance
Daily Fuel Use 3,000 X$1.347=$4,041,00 1,357,776.00 Annual Fuel Use
Monthly Fuel Use 4,041.00 X 28 days=$113,148.00 $1,508,976.00 Total Maint.&Fuel
Annual Fuel Use$113.148.00 X 12= 1,357,776.00
ALT
Daily Fuel Use 3,000 x 1.443=$4,329/00 9,000.00 Annual Maintenance"
Monthly Fuel Use$4329.00 x 28 days=$121,212.00 1,454,544.00 Annual Fuel Use
Annual Fuel Use$121,212,.00 X 12$1,454,544.00 $1,463,544.00 Total Maint.&Fuel
Cost differential $45,432.00
COPY
1 RESOLUTION NO.
2 RESOLUTION OF THE MAYOR: AND COMMON COUNCIL OF THE CITY OF
3 SAN BERNARDINO AUTHORIZING THE EXECUTION OF AN AMENDMENT AND
INCREASE TO CONTRACT PURCHASE ORDER #08-070, WITH THREE SINGLE
4 YEAR RENEWAL OPTIONS, TO APPLIED LNG TECHNOLOGIES PURSUANT TO
SECTION 3.04.010 B-3 OF THE MUNICIPAL CODE FOR THE PURCHASE OF LNG
5 FUEL.
6 BE IT RESOLVED BY THE MAYOR AND COMMON COUNCIL OF THE CITY
7 OF SAN BERNARDINO AS FOLLOWS:
8 WHEREAS, the current Contract Purchase Order of $149,900 needs to be
9 increased to $250,000 in order to fuel the LNG station;
10 SECTION 1. The City Manager of the City of San Bernardino is hereby
11
12 authorized to execute on behalf of said City an Amendment No. 1 to an Agreement
13 between the City of San Bernardino and Applied LNG Technologies, a copy of which is
14 attached hereto, marked Exhibit "A" and incorporated herein by reference as fully as
15 though set forth at length.
16 SECTION 2. The Mayor and Common Council hereby authorize the Director of
17 Finance or his/her designee to increase Contract Purchase Order No. 08-070 by an
18
additional $100,100 for a total of $250,000 beginning in FY 07/08.
19
20 SECTION 3. This purchase is exempt from the formal contract procedures of
21 Section 3.04.010 of the Municipal Code, pursuant to Section 3.04.010. B.3 of said
22 Code "Purchases approved by the Mayor and Common Council".
23 SECTION 4. The Purchase Order shall reference this Resolution No. 2008-
24 and shall read, "Applied LNG Technologies for the purchase of LNG fuel" and shall
25 incorporate the terms and conditions of the Agreement.
26
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April 9, 208
I RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY OF
2 SAN BERNARDINO AUTHORIZING THE EXECUTION OF AN AMENDMENT AND
INCREASE TO CONTRACT PURCHASE ORDER #08-070, WITH THREE SINGLE
3 YEAR RENEWAL OPTIONS, TO APPLIED LNG TECHNOLOGIES PURSUANT TO
SECTION 3.04.010 B-3, OF THE MUNICIPAL CODE FOR THE PURCHASE OF LNG
4 FUEL.
5 SECTION 5. The authorization to execute the above referenced Purchase
6
Order and agreement is rescinded if not issued within sixty (60) days of the passage of
7
this resolution.
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27 Ill
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April 9, 2008
1 RESOLUTION OF THE MAYOR. AND COMMON COUNCIL OF THE CITY OF
2 SAN BERNARDINO AUTHORIZING THE EXECUTION OF AN AMENDMENT AND
INCREASE TO CONTRACT PURCHASE ORDER #08-070, WITH THREE SINGLE
3 YEAR RENEWAL OPTIONS, TO APPLIED LNG TECHNOLOGIES PURSUANT TO
SECTION 3.04.010 B-3, OF THE MUNICIPAL CODE FOR THE PURCHASE OF LNG
4 FUEL.
5 1 HEREBY CERTIFY that the foregoing Resolution was duly adopted by the
6 Mayor and Common Council of the City of San Bernardino at a
7
meeting thereof, held on the day of 2008, by the
8
9 following vote, to wit:
10 Council Members: AYES NAYS ABSTAIN ABSENT
11 ESTRADA
12 BAXTER
13 BRINKER
14 DERRY
15
KELLEY
16
17 JOHNSON
18 MCCAMMACK
19
20 Rachel G. Clark, City Clerk
21 The foregoing resolution is hereby approved this day of
, 2008.
22
23 Patrick J. Morris, Mayor
24 City of San Bernardino
25 Approo ed as to form:
26
r
James F. Oenman
27 City Attorney
28
April 9, 2008
j AMENDMENT NO. 1 TO VENDOR SERVICES AGREEMENT
APPLIED LNG TECHNOLOGIES
2
3 This Agreement is entered into this 21 st day of April 2008, by and between
Applied LNG Technologies ("VENDOR") and the City of San Bernardino
4
("CITY" or"San Bernardino").
5 RECITALS
6 A. On February 4, 2008, Applied LNG Technologies and the City of San Bernardino
7 entered into a Vendor Services Agreement ("Agreement") for the purchase of
8 LNG fuel for a not-to-exceed amount of $99,900, a copy of which is attached
9 hereto as "Attachment 1" and incorporated by this reference.
10 B. On April 7`", 2008, Applied LNG Technologies and the City of San Bernardino
amended the Agreement to increase the amount of the Agreement by$50,000.
11 C. The CITY and VENDOR now desire to amend the Agreement to increase the
12 amount of the Agreement by $100,100 for a total not-to-exceed purchase price of
13 $250,000 for LNG fuel.
14 D. The CITY and VENDOR now desire to amend the Agreement terms to add three
15 (3) single year renewal options.
16 AGREEMENT
In consideration of the mutual promises contained in the Vendor Services
17 Agreement, the parties agree as follows:
18 1. Paragraph 1 and 2 of the Agreement dated February 4, 2008, attached here to
19 as Attachment 1, is amended to incorporate the terms and conditions of
20 Attachment 2, attached hereto and incorporated herein by this reference.
21 2. The total Agreement price shall be increased by $100,100, for a not-to-exceed
22 amount of$250,000.
23 3. The term of this Agreement shall be for an initial term from April 21, 2008
through June 30, 2008. With three (3) one-year extensions at the City's option.
24 Option year one, if exercised, shall be effective July 1, 2008 through June 30,
25 2009. Option year two, if exercised, shall be effective July 1, 2009 through
26 June 30, 2010. Option year three, if exercised, shall be effective July 1, 2010
27 through June 30, 2011.
28 4. The other provisions of the written contract are reaffirmed as originally stated.
Exhibit"A"
. 1
AMENDMENT NO. 1 TO VENDOR SERVICES AGREEMENT
2 APPLIED LNG TECHNOLOGIES
3
4
5 IN WITNESS THEREOF, the parties hereto have executed the Agreement on the day
and date first above written.
6
7 Dated: 52008 APPLIED LNG TECHNOLOGIES
8
9 By:
10
11
12
Dated: 12008 CITY OF SAN BERNARDINO
13
14
15 By: Fred Wilson, City Manager
16
17 ATTEST:
18
19
Rachel Clark, City Clerk
20
21
22 Approved as to form:
23
James F. Penman
24 City Attorney
25
By:
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Exhibit"A"
1 AMENDMENT NO. 1 TO VENDOR SERVICES AGREEMENT
2 APPLIED LNG TECHNOLOGIES
3 This Agreement is entered into this 21st day of April 2008, by and between
4 Applied LNG Technologies ("VENDOR") and the City of San Bernardino
("CITY" or"San Bernardino").
5
RECITALS
6 A. On February 4, 2008, Applied LNG Technologies and the City of San Bernardino
7 entered into a Vendor Services Agreement ("Agreement") for the purchase of
8 LNG fuel for a not-to-exceed amount of $99,900, a copy of which is attached
9 hereto as "Attachment 1" and incorporated by this reference.
10 B. On April 7`", 2008, Applied LNG Technologies and the City of San Bernardino
amended the Agreement to increase the amount of the Agreement by$50,000.
11 C. The CITY and VENDOR now desire to amend the Agreement to increase the
12 amount of the Agreement by $100,100 for a total not-to-exceed purchase price of
13 5250,000 for LNG fuel.
14 D. The CITY and VENDOR now desire to amend the Agreement terms to add three
15 (3) single year renewal options.
16 AGREEMENT
17 In consideration of the mutual promises contained in the Vendor Services
Agreement, the parties agree as follows:
18 1. Paragraph 1 and 2 of the Agreement dated February 4, 2008, attached here to
19 as Attachment 1, is amended to incorporate the terms and conditions of
20 Attachment 2, attached hereto and incorporated herein by this reference.
21 2. The total Agreement price shall be increased by$100,100, for a not-to-exceed
22 amount of$250,000.
23 3. The term of this Agreement shall be for an initial term from April 21, 2008
through June 30, 2008. With three (3) one-year extensions at the City's option.
24 Option year one, if exercised, shall be effective July 1, 2008 through June 30,
2009. Option year two, if exercised, shall be effective July 1, 2009 through
26 June 30, 2010. Option year three, if exercised, shall be effective July 1, 2010
27 through June 30, 2011.
28 4. The other provisions of the written contract are reaffirmed as originally stated.
1
AMENDMENT NO. 1 TO VENDOR SERVICES AGREEMENT
2 APPLIED LNG TECHNOLOGIES
3
4
5 IN WITNESS THEREOF, the parties hereto have executed the Agreement on the day
6 and date first above written.
7 Dated: , 2008 APPLIED LNG TECHNOLOGIES
8
9 By:
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12
13 Dated: ' 2008 CITY OF SAN BERNARDINO
14
15 By: Fred Wilson, City Manager
16
17 ATTEST:
18
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Rachel Clark, City Clerk
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22 Approved as to form:
23 James F. Penman
24 City Attorney
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2008-48
Attachment 1
1 VENDOR SERVICE AGREEMENT
This Vendor Service Agreement is
2 g entered Into this 4th day of February
3 2008, by and between Applied LNG Technologies ("VENDOR") and the City of San
4 Bernardino ("CITY" or"San Bernardino").
5 WITNESSETH:
6
7 WHEREAS, the Mayor and Common Council has determined that it is advantageous
8 and in the best interest of the CITY to purchase LNG fuel in order to continue to fuel its new
9 LNG station; and
10 WHEREAS, the City of San Bernardino did not solicit and accept quotes from vendors
11 for the purchase of LNG fuel since minor technical issues still need to be resolved before bid
12 specifications can be established.
13
NOW, THEREFORE, the parties hereto agree as follows:
14
1. SCOPE OF SERVICES.
15
16 For the remuneration stipulated, San Bernardino hereby engages the services of
17 VENDOR to provide LNG fuel.
18 2. COMPENSATION AND EXPENSES.
19 a. For the services delineated above, the CITY, upon presentation of an invoice, shall pay the
20 VENDOR up to the amount of$99,900 for the purchase of LNG fuel.
21
b. No other expenditures made by VENDOR shall be reimbursed by CITY.
22
23 3. TERM.
24 The term of this Agreement shall be for a period of one year.
25 This Agreement may be terminated at any time by thirty (30) days' written notice by
26 either party. The terms of this Agreement shall remain in force unless mutually amended. The
27 duration of this Agreement may be extended with the written consent of both parties.
28
01/31/08
2008-48
1 4. INDEMNITY.
2 CITY agrees to indemnify and hold harmless VENDOR, its officers, agents and
3 volunteers from any and all claims, actions, or losses, damages and/or liability resulting from
4 CITY's negligent acts or omissions arising from the CITY's performance of its obligations
5 under the Agreement.
6
VENDOR agrees to indemnify and hold harmless the CITY, its officers, agents, and
7
8 volunteers from any and all claim, actions, or losses, damages and/or liability resulting from
9 VENDOR's negligent acts or omissions arising from the VENDOR's performance of its
10 obligations under the agreement.
11 In the event the CITY and/or the VENDOR is found to be comparatively at fault for any
12 claim, action, loss, or damage which results from their respective obligations under the
13 Agreement, the CITY and/or VENDOR shall indemnify the other to the extent of this
14
15 comparative fault.
16 5. INSURANCE.
17 While not restricting or limiting the forgoing, during the term of this Agreement,
18 VENDOR shall maintain in effect policies of comprehensive public, general and automobile
19 liability insurance, in the amount of $1,000,000.00 combined single limit, and statutory
20 worker's compensation coverage, and shall file copies of said policies with the CITY's Risk
21
Manager prior to undertaking any work under this Agreement. CITY shall be set forth as an
22
23 additional named insured in each policy of insurance provided hereunder. The Certificate of
24 Insurance furnished to the CITY shall require the insurer to notify CITY of any change or
it termination in the policy.
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01/31/08
2008-48
1 6. NON-DISCRIMINATION.
2 In the performance of this Agreement and in the hiring and recruitment of employees,
3 VENDOR shall not engage in, nor permit its officers, employees or agents to engage in,
4 discrimination in employment of persons because of their race, religion, color, national origin,
5 ancestry, age, mental or physical disability, medical conditions, marital status, sexual gender or
6
sexual orientation, or any other status protected by law, except as permitted pursuant to Section
7
12940 of the California Government Code.
8
9 7. INDEPENDENT CONTRACTOR.
10 VENDOR shall perform work tasks provided by this Agreement, but for all intents and
11 purposes VENDOR shall be an independent contractor and not an agent or employee of the
12 CITY. VENDOR shall secure, at its expense, and be responsible for any and all payment of
13 Income Tax, Social Security, State Disability Insurance Compensation, Unemployment
14
15 Compensation, and other payroll deductions for VENDOR and its officers, agents, and
16 employees, and all business licenses, if any are required, in connection with the services to be
17 performed hereunder.
18 8. BUSINESS REGISTRATION CERTIFICATE AND OTHER REQUIREMENTS.
19 VENDOR warrants that it possesses or shall obtain, and maintain a business registration
20 certificate pursuant to Chapter, 5 of the Municipal Code and any other licenses,
21
22 qualifications, insurance and approval of whatever nature that are legally required of VENDOR
23 to practice its business or profession.
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01/31/08
I
2008-48
1 9. NOTICES.
2 Any notices to be given pursuant to this Agreement shall be deposited with the United
3 States Postal Service, postage prepaid and addressed as follows:
4 TO THE CITY: City of San Bernardino
5 Ken Fischer, Director
300 North "D" Street
6 San Bernardino, CA 92418
Telephone: (909) 384-5140
7
TO THE VENDOR: Applied LNG Technologies
8 3001 Knox St.
9 Dallas, TX 75205
Telephone: (214) 697-0391
10 Attn: Kevin W. Markey
11 10. ATTORNEYS' FEES.
12 In the event that litigation is brought by any party in connection with this Agreement,
13 the prevailing party shall be entitled to recover from the opposing party all costs and expenses,
14
including reasonable attorneys' fees, incurred by the prevailing party in the exercise of any of
15
16 its rights or remedies hereunder or the enforcement of any of the terms, conditions or
17 provisions hereof. The costs, salary and expenses of the City Attorney and members of his
18 office in enforcing this Agreement on behalf of the CITY shall be considered as "attorneys'
19 fees" for the purposes of this paragraph.
20 11. ASSIGNMENT.
21
22 VENDOR shall not voluntarily or by operation of law assign, transfer, sublet or
23 encumber all or any part of the VENDOR's interest in this Agreement without CITY's prior
24 written consent. Any attempted assignment, transfer, subletting or encumbrance shall be void
25 and shall constitute a breach of this Agreement and cause for the termination of this
26 Agreement. Regardless of CITY's consent, no subletting or assignment shall release VENDOR
27
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01/31/08
2008-48
1 of VENDOR's obligation to perform all other obligations to be performed by VENDOR
2 hereunder for the term of this Agreement.
3 12. VENUE.
4 The parties hereto agree that all actions or proceedings arising in connection with this
5 Agreement shall be tried and litigated either in the State courts located in the County of San
6
Bernardino, State of California or the U.S. District Court for the Central District of California,
7
8 Riverside Division. The aforementioned choice of venue is intended by the parties to be
9 mandatory and not permissive in nature.
10 13. GOVERNING LAW.
11 This Agreement shall be governed by the laws of the State of California.
12 14. SUCCESSORS AND ASSIGNS.
13
This Agreement shall be binding on and inure to the benefit of the parties to this
14
15 Agreement and their respective heirs, representatives, successors, and assigns.
16 15. HEADINGS.
17 The subject headings of the sections of this Agreement are included for the purposes of
18 convenience only and shall not affect the construction or the interpretation of any of its
19 provisions.
20 16. ENTIRE AGREEMENT; MODIFICATION.
21
22 This Agreement constitutes the entire agreement and the understanding between the
23 parties, and supercedes any prior agreements and understandings relating to the subject manner
24 of this Agreement. This Agreement may be modified or amended only by a written instrument
25 executed by all parties to this Agreement.
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01/31/08
2008-48
1 VENDOR SERVICE AGREEMENT
APPLIED LNG TECHNOLOGIES
2
3 IN WITNESS THEREOF, the parties hereto have executed this Agreement on the day
4 and date set forth below.
5 Dated: 3 ' (� , 2008 VENDO
6 By:
7 Its: Q �01•(S
8 Dated /
�i c.6 Cv , 2008 CITY OF ARDINO
9
By:
10 Fred i , City Manager
11
12 Approved as to Form:
13
14 By: - 41`
a
15 es F. Penman, City Attorney
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01/31/08
Attachment 2
AMT';
January 29, 2008
Don W. Johnson
Fleet Manager
City of San Bernardino
Public Services Department
182 South Sierra Way
San Bernardino, CA 92408
Mr. Johnson,
Applied LNG Technologies is pleased to offer you this proposal. We look
forward to offering you a complete LNG service. One of the ways we intend to do this is
to work with the City to open your fueling station to the general public. This new LNG
station would provide an environmentally friendly fuel to the surrounding business
community while creating a new source of revenue to the City.
In order to implement this plan Applied LNG Technologies will provide the
following:
1. Provide fuel grade LNG for the term of the agreement.
2. Assist in the completion of federal tax application (IRS form 637) to process tax
credits. And to assist on a monthly basis of providing data to file for your tax
credits.
3. Provide a Cooperative Purchase Agreement, which provides the LNG supply to
the City of San Bernardino.
• LNG pricing quote ((SoCal/ 12.104) x 1.2) + 0.45 plus freight.
4. We will also provide maintenance for your station when your warranty expires in 12
months. We will negotiate as this date gets closer. See attached maintenance agreement.
We look forward to working with you and the City on this project. Again, thank you for
the opportunity.
Kevin W. Markey
VP of Operation
3001 Knox Street—Suite 403
Dallas, TX 75205
Phone: 214.697.0391
Fax: 214.520.0507
ALT
APPLIED LNG TECHNOLOGIES MAINTENANCE AGREEMENT
EXHIBIT A
LNG Station Components
Periodic Inspection and Preventative Maintenance Schedule
Based on Information Supplied by Manufacturer
Monthly Quarterly Annually -2-year
Vent Lines — Check for leaks and dama e X
Flame Detectors — calibrate and test X
Grounding Circuit—verify continuity X
Air Desiccant— replace if indicated X
Air System — Snoop test for leaks X
Air System — Check regulator set point X
Valves & Piping: Check for leaks and malfunctions X
Fill Hoses: Check for leaks, damage and wear X
Dispensers: Check for leaks and malfunctions X
Fueling Nozzle Seals X
Drain air tank &/or water se arator X
Fire Extinguishers: inspect X
Air Regulator— Check set point ressure X
Air Conditioners —clean filters and assure proper X
o eration
Air Compressor— Check and maintain oil level X
Y Strainers —clean and inspect X
Process Lines — Snoop test valve stems, flanges,
um can flanges, and threaded fittings for leaks X
Methane Detectors — calibrate and test X
Relief Valves: Verify Proper Set Points X
VJ Piping Insulation: Integrity X
ESD System: test X
Storage Tank Vacuum: measure & record X
Control Hardware — Check operation and for leaks
on pressure gauges, liquid level gauges, transmitters X
— calibrate as necessa
Pressure Relief Valves —.recertify
X
Burst Disc: Replace X
LNG Pump: Labor to remove and inspect for
abnormal conditions at 4000 hours. Labor to remove
and return to manufacturer or repair facility for See intervals
rebuilding at 8000 hours
ALT
APPLIED LNG TECHNGLGGIES MAINTENANCE AGREEMENT
Vi.
FEE STRUCTURE
6.1. Unless otherwise agreed in writing by the parties, the fee structure for the
preventative maintenance required by this Agreement shall be as follows:
Maintenance Fee Structure
Preventative Maintenance Labor $ 750.00 per month
Unscheduled Call Out Labor (see 6.2 Fee Structure)
(fees subject to increase on an annual basis but limited to 3% per year)
Consumables, Parts, & Materials
Invoices $1000 and over Cost plus 15%
Invoices under $1000 Cost plus $150 administrative fee
6.2. Unless otherwise agreed in writing by the parties, the fee structure for the
breakdown repairs required by this Agreement shall be as follows:
Repair Fee Structure
LNG/LCNG/CNG Technician Field Service Rates
Continental United States & Mexico
Effective January 1 , 2006
• Field service "on site" labor rate is $100.00 per hour ($150.00 holiday) for all
hours worked (two hour minimum)
• Service labor rate for travel to and from site, phone support, or pre / post field
service is $50.00 per hour ($75.00 holiday) (one hour minimum)
• Driving: mileage charge is $0.485 per mile
• Air travel / rental car: costs plus 15% (as above)
• Per-diem: $200.00 per day
• Material: ALT/FleetStar cost plus 15% (as above)
• Sub-let labor: ALT/FleetStar cost plus 15% (as above)
• Equipment rental: ALT/FleetStar cost plus 15% (as above)
• Freight: ALT/FleetStar cost plus 15% (as above)
38. Resolutions authorizing increases to contract Purchase Order No. 08-062 in the
amount of $176,000 to Matich Corporation and contract Purchase Order No.
08-063 in the amount of$22,000 to Pavement Recycling Systems, Inc. for street
repairs. (See Attached) (Cost to City - $198,000 from Infrastructure Loan
Fund.) Wards 2&5
A. Resolution of the Mayor and Common Council of the City of San
Bernardino authorizing an increase to contract Purchase Order Number
08-062 in the amount of $176,000 to Matich Corporation pursuant to
Section 3.04.010 B-3 of the Municipal Code for additional street paving
services.
Adopted 2008-110
B. Resolution of the Mayor and Common Council of the City of San
Bernardino authorizing an increase to contract Purchase Order Number
08-063 in the amount of $22,000 to Pavement Recycling Systems, Inc.
pursuant to Section 3.04.010 B-3 of the Municipal Code for additional
cold planing services, labor and equipment rental for City street repairs.
Adopted 2008-111
Approved
MOTION: That said resolutions A&B, be adopted.
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
39. Resolution of the Mayor and Common Council of the City of San Bernardino
authorizing the execution of an amendment and increase to contract Purchase
Order #08-070, with three single year renewal options, to Applied LNG
Technologies pursuant to Section 3.04.010 B-3 of the Municipal Code for the
purchase of LNG fuel. (See Attached) (Cost to City - $150,100 from the
Fleet Services Fund.) All Wards
No Action Taken
MOTION: That said resolution be adopted.
Approved
MOTION: That the matter be placed on the Ways and Means Committee
agenda as a matter that arose subsequent to the posting of the
agenda; that the City Manager be authorized to purchase LNG
fuel for the refuse fleet for an amount not to exceed $50,000; and
that the matter be continued to April 21, 2008.
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
END OF CONSENT CALENDAR
14 04/07/2008
CITY OF SAN BERNARDINO - REQUEST FOR COUNCIL ACTION
From: Ken Fischer, Director :Subject: Resolution authorizing the
execution of an Amendment and
Dept: Public Services increase to Contract Purchase Order
x#08-070, with three single year renewal
Date: March 25, 2008 options to Applied LNG Technologies
pursuant to Section 3.04.010 B-3 of the
(Municipal Code for the purchase of LNG
fuel.
(Meeting Date: April 7, 2008
Synopsis of Previous Council Action
Reso 2008-48 February 4, 2008 Approved $75,000 increase to annual PO
Recommended Motion:
Adopt Resolution.
n ture
Contact person Don Johnson, Fleet Manager Phone: 5220
Supporting data attached: Staff Report,
Quote, Resolution, Agreement, and Amendment.
Ward: All
FUNDING REQUIREMENTS:
Amount: $150,100
Source: 635-341-5113
Motor Fuel &
Lubricants
Finance:
Council Notes:
wilDe
Agenda Item No.
CITY OF SAN BERNARDINO — REQUEST FOR COUNCIL ACTION
Staff Report
Subject:
Resolution authorizing the execution of an ,Amendment and increase to Contract
Purchase Order #08-070, with three single year renewal options, to Applied LNG
Technologies pursuant to Section 3.04.010 B-3 of the Municipal Code for the purchase
of LNG fuel.
Background:
Applied LNG Technologies is the company that supplied the first load of fuel to our new
LNG station (Station). Since Applied LNG Technologies is most familiar with our
Station, staff issued an interim contract purchase order in the amount of $24,900 to
purchase LNG fuel until staff could seek bids for a long-term contract. Unfortunately, it
took longer than anticipated to resolve the minor technical issues associated with the
construction and commissioning of the Station, and on February 4, 2008 resolution
#2008-48 was approved by the Mayor and Common Council increasing the purchase
order by $75,000.
The most critical issue to resolve was the activation of the Station credit card reader. A
long-term fuel supply contract was not possible until this system is fully operational.
Staff has worked closely with the City's bank ("fells Fargo) and has resolved this issue.
There are only two available vendors able to supply LNG fuel, Fleet staff has been in
contact with both vendors and requested quotes for a long term contract for LNG fuel
supply and station maintenance, the results are as follows:
Applied LNG Technologies is proposing to charge $1.29 per gallon plus freight. The
proposed preventive maintenance contract is $750.00 per month, which is $9,000 per
year. This covers monthly inspections and all preventive maintenance required by the
station manufacturer. Field service labor for repairs is $100 per hour plus parts costs,
so the City would only pay for each repair throughout the year. (see attached contract/
maintenance agreement attachment 2). The estimated annual station maintenance cost
is $40,000.
Clean Energy is proposing to charge $1.32 per gallon plus a diesel surcharge for
delivery. Their preventive maintenance proposal is an all-inclusive price based on a
$0.15 per gallon of LNG fuel pumped. The City's fleet currently uses approximately
1200 gallons per day (1200 x 0.15) = $180 per day. Fuel usage is expected to double
to 2400 gallons per day when sixteen (16) new LNG vehicles arrive by the end of the
fiscal year. This will raise the daily maintenance cost to $360 per day. IWM operations
run six (6) days a week, so we can expect to pay around $9,000 per month. This cost
would rise as more fuel is pumped from the station.
Fuel costs proposed by Applied LNG and Clean Energy are similar. However, the great
disparity between their proposed maintenance costs leads staff to recommend a multi-
year contract award to Applied LNG Technologies for LNG fuel supply beginning in FY
07/08 and station maintenance beginning in October of FY 08/09 when the warranty
period is completed. In order to allow the City, vehicles and the public to fuel without
interruption at our Station, staff is seeking approval of an amendment that includes
three (3) single year renewal options and an increase to the purchase order amount by
an additional $150,100 for a total of$250,000 for the remainder of FY 07/08.
Financial Impact:
Funds for this purchase are available in the FY 07-08 Account No. 635-341-5113,
Motor Fuel & Lubricants.
Recommendation:
Adopt Resolution.
1 RESOLUTION NO.
2 RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY OF
SAN BERNARDINO AUTHORIZING THE EXECUTION OF AN AMENDMENT AND
3 INCREASE TO CONTRACT PURCHASE ORDER #08-070, WITH THREE SINGLE
4 YEAR RENEWAL OPTIONS, TO APPLIED LNG TECHNOLOGIES PURSUANT TO
SECTION 3.04.010 B-3 OF THE MUNICIPAL CODE FOR THE PURCHASE OF LNG
5 FUEL.
6 BE IT RESOLVED BY THE MAYOR AND COMMON COUNCIL OF THE CITY
OF SAN BERNARDINO AS FOLLOWS:
7
8 WHEREAS, the current Contract Purchase Order of $99,900 needs to be
9 increased to $250,000 in order to fuel the LNG station;
10 SECTION 1. The City Manager of the City of San Bernardino is hereby
11 authorized to execute on behalf of said City an Amendment No. 1. to an Agreement
12 between the City of San Bernardino and Applied LNG Technologies, a copy of which is
13
attached hereto, marked Exhibit "A" and incorporated herein by reference as fully as
14
15 though set forth at length.
16 SECTION 2. The Mayor and Common Council hereby authorize the Director of
17 Finance or his/her designee to increase Contract Purchase Order No. 08-070 by an
18 additional $150,100 for a total of$250,000 beginning in FY 07/08.
19 SECTION 3. This purchase is exempt from the formal contract procedures of
20
Section 3.04.010 of the Municipal Code, pursuant to Section 3.04.010. B.3 of said
21
22 Code "Purchases approved by the Mayor and Common Council".
23 SECTION 4. The Purchase Order shall reference this Resolution No. 2008-
24 and shall read, "Applied LNG Technologies for the purchase of LNG fuel" and shall
25 incorporate the terms and conditions of the Agreement.
26
27
28
March 25, 2008
I RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY OF
SAN BERNARDINO AUTHORIZING THE EXECUTION OF AN AMENDMENT AND
2 INCREASE TO CONTRACT PURCHASE ORDER #08-070, WITH THREE SINGLE
YEAR RENEWAL OPTIONS, TO APPLIED LNG TECHNOLOGIES PURSUANT TO
3 SECTION 3.04.010 B-3, OF THE MUNICIPAL CODE FOR THE PURCHASE OF LNG
FUEL.
4
5 SECTION 5. The authorization to execute the above referenced Purchase
6 Order and agreement is rescinded if not issued within sixty (60) days of the passage of
7 this resolution.
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
March 25, 2008
i
j RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY OF
1 SAN BERNARDINO AUTHORIZING THE EXECUTION OF AN AMENDMENT AND
2 INCREASE TO CONTRACT PURCHASE ORDER #08-070, WITH THREE SINGLE
YEAR RENEWAL OPTIONS, TO APPLIED LNG TECHNOLOGIES PURSUANT TO
3 SECTION 3.04.010 B-3, OF THE MUNICIPAL CODE FOR THE PURCHASE OF LNG
FUEL.
4
5 1 HEREBY CERTIFY that the foregoing Resolution was duly adopted by the
6 Mayor and Common Council of the City of San Bernardino at a
7 meeting thereof,. held on the day of _ 2008, by the
8 following vote, to wit:
9 Council Members: AYES NAYS ABSTAIN ABSENT
10
ESTRADA
11
12 BAXTER
13 BRINKER
14 DERRY
15 KELLEY
16 JOHNSON
17
MCCAMMACK
18
19 Rachel G. Clark, City Clerk
20 The foregoing resolution is hereby approved this day of
21 , 2008.
22 _
23 Patrick J. Morris, Mayor
City of San Bernardino
24 A roved as to f rm:
25
26 Ja es F. Penman
27 City Attorney
28
March 25, 2008
1
AMENDMENT NO. 1 TO VENDOR SERVICES AGREEMENT
2 APPLIED LNG TECHNOLOGIES
3 This Agreement is entered into this 7th day of April 2008, by and between
4 Applied LNG Technologies ("VENDOR") and the City of San Bernardino
5 ("CITY" or"San Bernardino").
6 RECITALS
7 A. On February 4, 2008, Applied LNG Technologies and the City of San Bernardino
entered into a Vendor Services Agreement ("Agreement") for the purchase of
8 LNG fuel for a not-to-exceed amount of $99,900, a copy of which is attached
9 hereto as "Attachment 1" and incorporated by this reference.
10 B. The CITY and VENDOR now desire to amend the Agreement to increase the
11 amount of the Agreement by $150,100 for a total not-to-exceed purchase price of
12 $250,000 for LNG fuel.
13 C. The CITY and VENDOR now desire to amend the Agreement terms to add three
14 (3) single year renewal options.
AGREEMENT
15 In consideration of the mutual promises contained in the Vendor Services
16 Agreement, the parties agree as follows:
17 1. Paragraph 1 and 2 of the Agreement dated February 4, 2008, attached here to
18 as Attachment 1, is amended to incorporate the terms and conditions of
19 Attachment 2, attached hereto and incorporated herein by this reference.
20 2. The total Agreement price shall be increased by $150,100, for a not-to-exceed
amount of$250,000.
21 3. The term of this Agreement shall be for an initial term from April 7, 2008
22 through June 30, 2008. With three (3) one-year extensions at the City's option.
23 Option year one, if exercised, shall be effective July 1, 2008 through June 30,
24 2009. Option year two, if exercised, shall be effective July 1, 2009 through
25 June 30, 2010. Option year three, if exercised, shall be effective July 1, 2010
26 through June 30, 2011.
27 4. The other provi re reaffirmed as originally stated.
28 �X�, -A
1
AMENDMENT NO. 1 TO VENDOR SERVICES AGREEMENT
2 APPLIED LNG TECHNOLOGIES
3
4
5 IN WITNESS THEREOF, the parties hereto have executed the Agreement on the day
and date first above written.
6
7 Dated: , 2008 APPLIED LNG TECHNOLOGIES
8
9 By:
10
11
12
Dated: , 2008 CITY OF SAN BERNARDINO
13
14
15 By: Fred Wilson, City Manager
16
17 ATTEST:
18
19 Rachel Clark, City Clerk
20
21
22 Approved as to form:
23
James F. Penman
24 City Attorney
25 B I i
y•
26
27
28
2008-48
Attachment 1
1 VENDOR SERVICE AGREEMENT
2 This Vendor Service Agreement is entered into this 4th day of February
3 2008, by and between Applied LNG Technologies ("VENDOR") and the City of San
4 Bernardino ("CITY" or"San Bernardino").
5 WITNESSETH:
6
WHEREAS, the Mayor and Common Council has determined that it is advantageous
7
and in the best interest of the CITY to purchase LNG fuel in order to continue to fuel its new
8
9 LNG station; and
10 WHEREAS, the City of San Bernardino did not solicit and accept quotes from vendors
11 for the purchase of LNG fuel since minor technical issues still need to be resolved before bid
12 specifications can be established.
13 NOW, THEREFORE, the parties hereto agree as follows:
14
1. SCOPE OF SERVICES.
15
16 For the remuneration stipulated, San Bernardino hereby engages the services of
17 VENDOR to provide LNG fuel.
18 2. COMPENSATION AND EXPENSES.
19 a. For the services delineated above, the CITY, upon presentation of an invoice, shall pay the
20 VENDOR up to the amount of$99,900 for the purchase of LNG fuel.
21
b. No other expenditures made by VENDOR shall be reimbursed by CITY.
22
3. TERM.
23
24 The term of this Agreement shall be for a period of one year.
25 This Agreement may be terminated at any time by thirty (30) days' written notice by
26 either party. The terms of this Agreement shall remain in force unless mutually amended. The
27 duration of this Agreement may be extended with the written consent of both parties.
28
01/31/08
2008-48
1 4. INDEMNITY.
2 CITY agrees to indemnify and hold harmless VENDOR, its officers, agents and
3 volunteers from any and all claims, actions, or losses, damages and/or liability resulting from
4 CITY's negligent acts or omissions arising from the CITY's performance of its obligations
5 under the Agreement.
6
VENDOR agrees to indemnify and hold harmless the CITY, its officers, agents, and
7
8 volunteers from any and all claim, actions, or losses, damages and/or liability resulting from
9 VENDOR's negligent acts or omissions arising from the VENDOR's performance of its
10 obligations under the agreement.
11 In the event the CITY and/or the VENDOR is found to be comparatively at fault for any
12 claim, action, loss, or damage which results from their respective obligations under the
13 Agreement, the CITY and/or VENDOR shall indemnify the other to the extent of this
14
comparative fault.
15
16 5. INSURANCE.
17 While not restricting or limiting the forgoing, during the term of this Agreement,
18 VENDOR shall maintain in effect policies of comprehensive public, general and automobile
19 liability insurance, in the amount of $1,000,000.00 combined single limit, and statutory
20 worker's compensation coverage, and shall file copies of said policies with the CITY's Risk
21
Manager prior to undertaking any work under this Agreement. CITY shall be set forth as an
22
23 additional named insured in each policy of insurance provided hereunder. The Certificate of
24 Insurance furnished to the CITY shall require the insurer to notify CITY of any change or
25 termination in the policy.
26
27
28
01/31/08
(I
2008-48
1 6. NON-DISCRIMINATION.
2 In the performance of this Agreement and in the hiring and recruitment of employees,
3 VENDOR shall not engage in, nor permit its officers, employees or agents to engage in,
4 discrimination in employment of persons because of their race, religion, color, national origin,
5 ancestry, age, mental or physical disability, medical conditions marital status sexual gender or
6
sexual orientation, or any other status protected by law, except as permitted pursuant to Section
7
12940 of the California Government Code.
8
9 7. INDEPENDENT CONTRACTOR.
10 VENDOR shall perform work tasks provided by this Agreement, but for all intents and
11 purposes VENDOR shall be an independent contractor and not an agent or employee of the
12 CITY. VENDOR shall secure, at its expense, and be responsible for any and all payment of
13 Income Tax, Social Security, State Disability Insurance Compensation, Unemployment
14
15 Compensation, and other payroll deductions for VENDOR and its officers, agents, and
16 employees, and all business licenses, if any are required, in connection with the services to be
17 performed hereunder.
18 8. BUSINESS REGISTRATION CERTIFICATE AND OTHER REQUIREMENTS.
19 VENDOR warrants that it possesses or shall obtain, and maintain a business registration
20 certificate pursuant to Chapter 5 of the Municipal Code, and any other licenses, permits,
21
qualifications, insurance and approval of whatever nature that are legally required of VENDOR
22
23 to practice its business or profession.
24
25
26
27
28
01/31/08
II
2008-48
1 9. NOTICES.
2 Any notices to be given pursuant to this Agreement shall be deposited with the United
3 States Postal Service, postage prepaid and addressed as follows:
4 TO THE CITY: City of San Bernardino
5 Ken Fischer, Director
300 North"D" Street
6 San Bernardino, CA 92418
Telephone: (909) 384-5140
7
TO THE VENDOR: Applied LNG Technologies
8 3001 Knox St.
9 Dallas, TX 75205
Telephone: (214) 697-0391
10 Attn: Kevin W. Markey
11 10. ATTORNEYS' FEES.
12 In the event that litigation is brought by any party in connection with this Agreement,
13 the prevailing P art shall be entitled to recover from the opposing party all costs and expenses,
14
including reasonable attorneys' fees, incurred by the prevailing party in the exercise of any of
15
16 its rights or remedies hereunder or the enforcement of any of the terms, conditions or
17 provisions hereof. The costs, salary and expenses of the City Attorney and members of his
18 office in enforcing this Agreement on behalf of the CITY shall be considered as "attorneys'
19 fees" for the purposes of this paragraph.
20 11. ASSIGNMENT.
21
VENDOR shall not voluntarily or by operation of law assign, transfer, sublet or
22
23 encumber all or any part of the VENDOR's interest in this Agreement without CITY's prior
24 written consent. Any attempted assignment, transfer, subletting or encumbrance shall be void
25 and shall constitute a breach of this Agreement and cause for the termination of this
26 Agreement. Regardless of CITY's consent, no subletting or assignment shall release VENDOR
27
28
01/31/08
I
2008-48
1 of VENDOR's obligation to perform all other obligations to be performed by VENDOR
2 hereunder for the term of this Agreement.
3 12. VENUE.
4 The parties hereto agree that all actions or proceedings arising in connection with this
5 Agreement shall be tried and litigated either in the State courts located in the County of San
6
Bernardino, State of California or the U.S. District Court for the Central District of California,
7
8 Riverside Division. The aforementioned choice of venue is intended by the parties to be
9 mandatory and not permissive in nature.
10 13. GOVERNING LAW.
11 This Agreement shall be governed by the laws of the State of California.
12 14. SUCCESSORS AND ASSIGNS.
13
This Agreement shall be binding on and inure to the benefit of the parties to this
14
15 Agreement and their respective heirs, representatives, successors, and assigns.
16 15. HEADINGS.
17 The subject headings of the sections of this Agreement are included for the purposes of
18 convenience only and shall not affect the construction or the interpretation of any of its
19 provisions.
20 16. ENTIRE AGREEMENT; MODIFICATION.
21
This Agreement constitutes the entire agreement and the understanding between the
22
23 parties, and supercedes any prior agreements and understandings relating to the subject manner
24 of this Agreement. This Agreement may be modified or amended only by a written instrument
25 executed by all parties to this Agreement.
26
27
28
01/31/08
II
2008-48
1 VENDOR SERVICE AGREEMENT
APPLIED LNG TECHNOLOGIES
2
3 IN WITNESS THEREOF, the parties hereto have executed this Agreement on the day
and date set forth below.
4
5 Dated: , 2008 VENDO
6 By:
7 Its: /OyCs'
8 Dated (,—, 2008 CITY OF ARDINO
9
By:
10 Fred i , City Manager
11
12 Approved as to Form:
13
14 By: dam_
a
15 es F. Penman, City Attorney
16
17
18
19
20
21
22
23
24
25
26
27
28
01/31/08
Attachment 2
ORE E"
January 29, 2008
Don W. Johnson
Fleet Manager
City of San Bernardino
Public Services Department
182 South Sierra Way
San Bernardino, CA 92408
Mr. Johnson,
Applied LNG Technologies is pleased to offer you this proposal. We look
forward to offering you a complete LNG service. One of the ways we intend to do this is
to work with the City to open your fueling station to the general public. This new LNG
station would provide an environmentally friendly fuel to the surrounding business
community while creating a new source of revenue to the City.
In order to implement this plan Applied LNG Technologies will provide the
following:
1. Provide fuel grade LNG for the term of the agreement
2. Assist in the completion of federal tax application(IRS form 637) to process tax
credits. And to assist on a monthly basis of providing data to file for your tax
credits.
3. Provide a Cooperative Purchase Agreement which bundles the LNG supply to the
City of San Bernardino (see attached LNG contract)
• LNG pricing quote ((SoCal/ 12.104) x 1.2) + 0.45 plus freight.
4. We will also provide maintenance for your station when your warranty expires in 12
months. We will negotiate as this date gets closer. See attached maintenance contract.
We look forward to working with you and the City on this project. Again, thank you for
the opportunity.
Kevin W. Markey
VP of Operation
3001 Knox Street—Suite 403
Dallas, TX 75205
Phone: 214.697.0391
Fax: 214.520.0507 P
Attachment 2
A LT
APPLIED LNG TaCHMOLOGIES MAINTENANCE AGREEMENT
LNG Station Components
Periodic Inspection and Preventative Maintenance Schedule
Based on Information Supplied by Manufacturer
Monthly Quarterly Annual) 2-year
Vent Lines — Check for leaks and damage X
Flame Detectors — calibrate and test X
Grounding Circuit—verity continuity X
Air Desiccant— replace if indicated X
Air System — Snoop test for leaks X
Air System — Check regulator set point X
Valves & Piping: Check for leaks and malfunctions X
Fill Hoses: Check for leaks, damage and wear X
Dispensers: Check for leaks and malfunctions X
Fueling Nozzle Seals X
Drain air tank &/or water separator X
Fire Extinguishers: inspect X
Air Regulator— Check set point pressure X
Air Conditioners —clean filters and assure proper X
operation
Air Compressor— Check and maintain oil level X
Y Strainers — clean and inspect X
Process Lines — Snoop test valve stems, flanges, X
pump can flanges, and threaded fittings for leaks
Methane Detectors— calibrate and test X
Relief Valves: Verify Proper Set Points X
VJ Piping Insulation: Integrity X
ESD System: test x
Storage Tank Vacuum: measure & record X
Control Hardware — Check operation and for leaks
on pressure gauges, liquid level gauges, transmitters X
— calibrate as necessary
Pressure Relief Valves — recertify X
Burst Disc: Replace X
LNG Pump: Labor to remove and inspect for
abnormal conditions at 4000 hours. Labor to remove See intervals
and return to manufacturer or repair facility for
rebuilding at 8000 hours
7of7
1
AMENDMENT NO. 1 TO VENDOR SERVICES AGREEMENT
2 APPLIED LNG TECHNOLOGIES
3 This Agreement is entered into this 7th day of April 2008, by and between
4 Applied LNG Technologies ("VENDOR") and the City of San Bernardino
5 ("CITY" or"San Bernardino").
6 RECITALS
7 A. On February 4, 2008, Applied LNG Technologies and the City of San Bernardino
entered into a Vendor Services Agreement ("Agreement") for the purchase of
8 LNG fuel for a not-to-exceed amount of $99,900, a copy of which is attached
9 hereto as "Attachment I" and incorporated by this reference.
10 B. The CITY and VENDOR now desire to amend the Agreement to increase the
11 amount of the Agreement by $150,100 for a total not-to-exceed purchase price of
12 $250,000 for LNG fuel.
13 C. The CITY and VENDOR now desire to amend the Agreement terms to add three
14 (3) single year renewal options.
AGREEMENT
15 In consideration of the mutual promises contained in the Vendor Services
16 Agreement, the parties agree as follows:
17 1. Paragraph 1 and 2 of the Agreement dated February 4, 2008, attached here to
18 as Attachment 1, is amended to incorporate the terms and conditions of
19 Attachment 2, attached hereto and incorporated herein by this reference.
20 2. The total Agreement price shall be increased by $150,100, for a not-to-exceed
amount of$250,000.
21 3. The term of this Agreement shall be for an initial term from April 7, 2008
22 through June 30, 2008. With three (3) one-year extensions at the City's option.
23 Option year one, if exercised, shall be effective July 1, 2008 through June 30,
24 2009. Option year two, if exercised, shall be effective July 1, 2009 through
25 June 30, 2010. Option year three, if exercised, shall be effective July 1, 2010
26 through June 30, 2011.
27 4. The other provisions of the written contract are reaffirmed as originally stated.
28
Exhibit"A"
OEM
1
AMENDMENT NO. 1 TO VENDOR SERVICES AGREEMENT
2 APPLIED LNG TECHNOLOGIES
3
4
5 IN WITNESS THEREOF, the parties hereto have executed the Agreement on the day
and date first above written.
6
7 Dated: 12008 APPLIED LNG TECHNOLOGIES
8
9 By:
10
11
12
Dated: , 2008 CITY OF SAN BERNARDINO
13
14
15 By: Fred Wilson, City Manager
16
17 ATTEST:
18
19 Rachel Clark, City Clerk
20
21
22 Approved as to form:
23
James F. Penman
24 City Attorney
25
By:
26
27
28
Exhibit"A"
2008-48
Attachment 1
1 VENDOR SERVICE AGREEMENT
2 This Vendor Service Agreement is entered into this 4th day of February
3 2008, by and between Applied LNG Technologies ("VENDOR") and the City of San
4 Bernardino ("CITY" or"San Bernardino").
5 WITNESSETH:
6
7 WHEREAS, the Mayor and Common Council has determined that it is advantageous
and in the best interest of the CITY to purchase LNG fuel in order to continue to fuel its new
8
9 LNG station; and
10 WHEREAS, the City of San Bernardino did not solicit and accept quotes from vendors
11 for the purchase of LNG fuel since minor technical issues still need to be resolved before bid
12 specifications can be established.
13 NOW, THEREFORE, the parties hereto agree as follows:
14
1. SCOPE OF SERVICES.
15
16 For the remuneration stipulated, San Bernardino hereby engages the services of
17 VENDOR to provide LNG fuel.
18 2. COMPENSATION AND EXPENSES.
19 a. For the services delineated above, the CITY, upon presentation of an invoice, shall pay the
20 VENDOR up to the amount of$99,900 for the purchase of LNG fuel.
21
22 b. No other expenditures made by VENDOR shall be reimbursed by CITY.
3. TERM.
23
24 The term of this Agreement shall be for a period of one year.
255 This Agreement may be terminated at any time by thirty (30) days' written notice by
26 either party. The terms of this Agreement shall remain in force unless mutually amended. The
27 duration of this Agreement may be extended with the written consent of both parties.
28
01/31/08
I I
2008-48
1 4. INDEMNITY.
2 CITY agrees to indemnify and hold harmless VENDOR, its officers, agents and
3 volunteers from any and all claims, actions, or losses, damages and/or liability resulting from
4 CITY's negligent acts or omissions arising from the CITY's performance of its obligations
5 under the Agreement.
6
VENDOR agrees to indemnify and hold harmless the CITY, its officers, agents, and
7
8 volunteers from any and all claim, actions, or losses, damages and/or liability resulting from
9 VENDOR's negligent acts or omissions arising from the VENDOR's performance of its
10 obligations under the agreement.
11 In the event the CITY and/or the VENDOR is found to be comparatively at fault for any
12 claim, action, loss, or damage which results from their respective obligations under the
13 Agreement, the CITY and/or VENDOR shall indemnify the other to the extent of this
14
comparative fault.
15
16 5. INSURANCE.
17 While not restricting or limiting the forgoing, during the term of this Agreement,
18 VENDOR shall maintain in effect policies of comprehensive public, general and automobile
19 liability insurance, in the amount of $1,000,000.00 combined single limit, and statutory
20 worker's compensation coverage, and shall file copies of said policies with the CITY's Risk
21
Manager prior to undertaking any work under this Agreement. CITY shall be set forth as an
22
23 additional named insured in each policy of insurance provided hereunder. The Certificate of
24 Insurance furnished to the CITY shall require the insurer to notify CITY of any change or
25 termination in the policy.
26
27
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01/31/08
II I
2008-48
1 6. NON-DISCRIMINATION.
2 In the performance of this Agreement and in the hiring and recruitment of employees,
3 VENDOR shall not engage in, nor permit its officers, employees or agents to engage in,
4 discrimination in employment of persons because of their race, religion, color, national origin,
5 ancestry, age, mental or physical disability, medical conditions, marital status, sexual gender or
6
sexual orientation, or any other status protected by law, except as permitted pursuant to Section
7
12940 of the California Government Code.
8
9 7. INDEPENDENT CONTRACTOR.
10 VENDOR shall perform work tasks provided by this Agreement, but for all intents and
11 purposes VENDOR shall be an independent contractor and not an agent or employee of the
12 CITY. VENDOR shall secure, at its expense, and be responsible for any and all payment of
13
Income Tax, Social Security, State Disability Insurance Compensation, Unemployment
14
15 Compensation, and other payroll deductions for VENDOR and its officers, agents, and
16 employees, and all business licenses, if any are required, in connection with the services to be
17 performed hereunder.
18 8. BUSINESS REGISTRATION CERTIFICATE AND OTHER REQUIREMENTS.
19 VENDOR warrants that it possesses or shall obtain, and maintain a business registration
20 certificate pursuant to Chapter 5 of the Municipal Code and any other licenses,
21
qualifications, insurance and approval of whatever nature that are legally required of VENDOR
22
23 to practice its business or profession.
24
25
26
27
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01/31/08
II I
2008-48
1 9. NOTICES.
2 Any notices to be given pursuant to this Agreement shall be deposited with the United
3 States Postal Service, postage prepaid and addressed as follows:
4 TO THE CITY: City of San Bernardino
5 Ken Fischer, Director
300 North"D" Street
6 San Bernardino, CA 92418
Telephone: (909) 384-5140
7
TO THE VENDOR: Applied LNG Technologies
8 3001 Knox St.
9 Dallas, TX 75205
Telephone: (214) 697-0391
10 Attn: Kevin W. Markey
11 10. ATTORNEYS' FEES.
12 In the event that litigation is brought by any party in connection with this Agreement,
13 the prevailing party shall be entitled to recover from the opposing party all costs and expenses,
14
15 including reasonable attorneys' fees, incurred by the prevailing party in the exercise of any of
16 its rights or remedies hereunder or the enforcement of any of the terms, conditions or
17 provisions hereof. The costs, salary and expenses of the City Attorney and members of his
18 office in enforcing this Agreement on behalf of the CITY shall be considered as "attorneys'
19 fees" for the purposes of this paragraph.
20 11. ASSIGNMENT.
21
VENDOR shall not voluntarily or by operation of law assign, transfer, sublet or
22
23 encumber all or any part of the VENDOR's interest in this Agreement without CITY's prior
24 written consent. Any attempted assignment, transfer, subletting or encumbrance shall be void
25 and shall constitute a breach of this Agreement and cause for the termination of this
26 Agreement. Regardless of CITY's consent, no subletting or assignment shall release VENDOR
27
28
01/31/08
II I
2008-48
1 of VENDOR's obligation to perform all other obligations to be performed by VENDOR
2 hereunder for the term of this Agreement.
3 12. VENUE.
4 The parties hereto agree that all actions or proceedings arising in connection with this
5 Agreement shall be tried and litigated either in the State courts located in the County of San
6
Bernardino, State of California or the U.S. District Court for the Central District of California,
7
8 Riverside Division. The aforementioned choice of venue is intended by the parties to be
9 mandatory and not permissive in nature.
10 13. GOVERNING LAW.
11 This Agreement shall be governed by the laws of the State of California.
12 14. SUCCESSORS AND ASSIGNS.
13
This Agreement shall be binding on and inure to the benefit of the parties to this
14
15 Agreement and their respective heirs, representatives, successors, and assigns.
16 15. HEADINGS.
17 The subject headings of the sections of this Agreement are included for the purposes of
18 convenience only and shall not affect the construction or the interpretation of any of its
19 provisions.
20 16. ENTIRE AGREEMENT; MODIFICATION.
21
This Agreement constitutes the entire agreement and the understanding between the
22
23 pies, and supercedes any prior agreements and understandings relating to the subject manner
24 of this Agreement. This Agreement may be modified or amended only by a written instrument
25 executed by all parties to this Agreement.
26
27
28
01/31/08
( I I
2008-48
1 VENDOR SERVICE AGREEMENT
APPLIED LNG TECHNOLOGIES
2
3 IN WITNESS THEREOF, the parties hereto have executed this Agreement on the day
4 and date set forth below.
5 Dated: 3 _l 2008 VENDO
6 By:
7 Its: 19
8 Dated6 , 2008 CITY OF ARDINO
9
By:
10 Fred i , City Manager
11
12 Approved as to Form:
13
14 By:
a
15 es F. Penman, City Attorney
16
17
18
19
20
21
22
23
24
25
26
27
28
01/31/08
II
Attachment 2
E t
Ucmain raps
January 29, 2008
Don W. Johnson
Fleet Manager
City of San Bernardino
Public Services Department
182 South Sierra Way
San Bernardino, CA 92408
Mr. Johnson,
Applied LNG Technologies is pleased to offer you this proposal. We look
forward to offering you a complete LNG service. One of the ways we intend to do this is
to work with the City to open your fueling station to the general public. This new LNG
station would provide an environmentally friendly fuel to the surrounding business
community while creating a new source of revenue to the City.
In order to implement this plan Applied LNG Technologies will provide the
following:
1. Provide fuel grade LNG for the term of the agreement
2. Assist in the completion of federal tax application(IRS form 637) to process tax
credits. And to assist on a monthly basis of providing data to file for your tax
credits.
3. Provide a Cooperative Purchase Agreement which bundles the LNG supply to the
City of San Bernardino (see attached LNG contract)
• LNG pricing quote((SoCal/ 12.104) x 1.2) + 0.45 plus freight.
4. We will also provide maintenance for your station when your warranty expires in 12
months. We will negotiate as this date gets closer. See attached maintenance contract.
We look forward to working with you and the City on this project. Again, thank you for
the opportunity.
Kevin W. Markey
VP of Operation
3001 Knox Street—Suite 403
Dallas, TX 75205
Phone: 214.697.0391
Fax: 214.520.0507
Attachment 2
APPLIiED LNG TficHNQLOQIES MAINTENANCE AGREEMENT
LNG Station Components
Periodic Inspection and Preventative Maintenance Schedule
Based on Information Supplied by Manufacturer
Month) Quarter) Annual) 2-year
Vent Lines — Check for leaks and damage X
Flame Detectors — calibrate and test X
Grounding Circuit—verify continuity X
Air Desiccant— replace if indicated X
Air System — Snoop test for leaks X
Air System — Check regulator set point X
Valves & Piping: Check for leaks and malfunctions X
Fill Hoses: Check for leaks, damage and wear X
Dispensers: Check for leaks and malfunctions X
Fueling Nozzle Seals X
Drain air tank &/or water separator X
Fire Extinguishers: inspect X
Air Regulator— Check set point pressure X
Air Conditioners — clean filters and assure proper X
operation
Air Compressor— Check and maintain oil level X
Y Strainers — clean and inspect X
Process Lines — Snoop test valve stems, flanges, X
pump can flanges, and threaded fittings for leaks
Methane Detectors —calibrate and test X
Relief Valves: Verify Proper Set Points X
VJ Piping Insulation: Integrity X
ESD System: test X
Storage Tank Vacuum: measure & record X
Control Hardware — Check operation and for leaks
on pressure gauges, liquid level gauges, transmitters X
— calibrate as necessary
Pressure Relief Valves — recertify X
Burst Disc: Replace X
LNG Pump: Labor to remove and inspect for
abnormal conditions at 4000 hours. Labor to remove See intervals
and return to manufacturer or repair facility for
rebuilding at 8000 hours
7of7
Cs
3020 Old Ranch Parkway,Suite 200 Chad M.Lindholm
Seal Beach,California 90740 USA �nt�rrf into RP.CO�(I 8t /� Regional Manager
Phone 562.546-0322 '"7 /O(�
Fax 562.493-4532 "levcMS Mtg: G
www.cleanenercivfueis.com
Clean Energy'"
April 7, 2008
Mr. Fred Wilson City Clerk/CDC Secy
City Manager City of Sall 13 .rrfardinn
City of San Bernardino
300 North D Street Via email &facsimile
San Bernardino, CA 92418
Re: Agenda Item 39,Purchase of LNG Fuel
Dear Mr. Wilson:
Clean Energy has reviewed Agenda Item 39, the proposed resolution regarding Purchase
Order#08-070 for the supply of LNG fuel to the City of San Bernardino. We have
concerns over the solicitation process, evaluation and the recommendation before council.
Solicitation Process
At no time was there an official release of a documented"Request for Proposals" where
detailed guidelines could be followed by all proposers. Therefore, critical components of
the City's fleet operation including current and future LNG volume needs as well as station
maintenance requirements were unknown. Further, the staff report makes no mention of
evaluation criteria such as LNG fuel supplier company background, experience, capabilities
or references. These are important points which should be considered in an evaluation
involving well over$1 million of annual costs to the City to ensure reliable LNG deliveries
to fuel vehicles providing essential City services.
Critical Criteria Not Evaluated
Company Background—Clean Energy is North America's largest natural gas vehicle fuel
provider both in number of stations and gallons sold per year. Today CE owns and operates
over 170 natural gas fueling stations with a broad customer base in the transit, refuse,
shuttle, taxi, intrastate and interstate trucking, airport and municipal fleet markets. Clean
Energy was formed in 2001 and currently employs over 125 people. CE has offices in
Arizona, California, Colorado, District of Columbia, Georgia, Texas, Washington,
Massachusetts, as well as Vancouver and Toronto, Canada.
Experience—Clean Energy is the largest provider of vehicular natural gas (CNG and LNG)
in North America currently delivering over 140,000 gallons of LNG per day to 40+
customers. Customers include the cities of Bakersfield, Barstow, Fresno, Phoenix,
Sacramento, Santa Monica, Tempe and Tulare as well as Omnitrans and the Los Angeles
World Airports.
North America's leader in clean transportation
Capabilities—Clean Energy is the only fuel provider with several LNG supply sources and
a proven track record to ensure the City of reliable and consistent LNG fuel deliveries.
In addition Clean Energy is currently constructing an LNG production plant in Boron,
California; only 75 miles from the City's yard. The Boron plant will produce 160,000
gallons per day and have a 1.5 million gallon storage tank. This 1.5 million gallon storage
tank is the only LNG storage facility in the entire Southwest region of the United States that
is sizeable enough to maintain customer deliveries during production disruptions. Clean
Energy will also have exclusive LNG supply from a new plant in Arizona opening this
summer. Further, our LNG tanker fleet of 60 units is the largest in the country dedicated to
LNG fuel deliveries.
Evaluation
We believe that a significant error has been made in evaluating the total cost of delivered
LNG and the total cost of station maintenance.
LNG Fuel Cost
The staff report states that Clean Energy's and ALT's "fuel costs are similar" however, this
is incorrect. The report concludes that ALT's fuel price is $1.29 per gallon plus freight and
Clean Energy's fuel price is $1.32 plus a diesel surcharge. There is no backup data to
support these figures and no pricing provided for freight or the diesel surcharge. Below is
an actual price comparison if fuel were to be delivered by either company today:
$/LNG Gallon Clean Energy ALT
April 2008 Natural Gas $0.726 $0.726
Commodity Price
20% Premium added to $0.000 $0.145
Commodity Price
Delivery Charge $0.620 $0.450
Freight $0.00 ??? Not provided in proposal
$0.144*
Diesel Surcharge $0.001 $0.000
($11.54/9,000 gallons)
Total $1.347 $1.465
Clean Energy Savings per $0.118
Gallon
Clean Energy Annual $88,358
Savings to City
*Diesel surcharge when fuel is above$3.50 per gallon. Assume DOE monthly diesel is$4.00:
($4.00/gal-$3.50/gal)x(round trip miles from Boron to San Bernardino of 150 miles/6.5 mpg)_$11.54
**Estimate of Freight Calculation per gallon is$0.144 (assumes$1300 per delivery and 9,000 gallons delivered)
Station Maintenance Cost
It remains unclear as to what basis was used in price comparison for future maintenance
services. The recommendation states that there is a"great disparity"between Clean
Energy's and ALT's maintenance costs". While CE's maintenance costs are clearly stated
in our proposal ($0.15 per gallon), ALT's proposal does not quote a price, but instead states
that after the station warranty period expires a rate will be negotiated. However, the
recommendation before council includes a breakdown of costs from ALT. We are not sure
how this information was derived.
Since there was no guidance on how to bid maintenance services, proposals from both
companies are completely different. Clean Energy has more service technicians that any
other LNG fuel supplier—50 employees across the country of which 13 are based in
Southern California. Our maintenance cost included all major and minor service (labor,
parts, planed maintenance and emergency call-outs). The price quoted was based on the
City's current usage of 1,200 gallons per day which would cost the City$4,500 per month
or$54,000 annually. We explained to City staff that with increased volume, we'd certainly
present a new maintenance price. We also explained that our maintenance bid was an
option to the City and not inclusive of fuel supply services. The assumption that Clean
Energy's maintenance cost to the City is $9,000 per month is incorrect.
Listed maintenance numbers for ALT are $750 per month for once a month maintenance.
This number does not include labor at$100 per hour or parts. Based on this data, an
estimated annual cost of$40,000 has been assumed. It is not clear where any of these
numbers originated from.
Clean Energy's Recommendation
Having provided LNG and CNG fueling services to thousands of fleet customers on a daily
basis, Clean Energy understands the City's proactive alternative fuel policy and welcomes
the opportunity to develop a long-term partnership. We appreciate your consideration of
our concerns and ask that you and the city council take an active role in evaluating the
proposals and reviewing the process.
Clean Energy remains available to meet in person and discuss our capabilities and the
contents of our proposal in greater detail. I can be reached at(562)493-2804.
Sincerely,
Chad Lindholm
Regional Manager
Southern California&Arizona
cc: Mayor and City Council
James Penman, City Attorney
Ken Fischer, Public Services Director
Don Johnson, Fleet Manager
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3020 Old Ranch Parkway
Seal Beach, CA 90740
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www.cleanenergyfuels.com
February 5, 2008
Clean Energy
Table of Contents
Description Tab
Introduction 1
Capabilities 2
LNG Production and Supply 2.1
LNG Delivery Management 2.2
Qualifications and Experience 3
Company Profile 3.1
Client References 3.2
Organization and Staffing 4
Organizational Chart 4.1
Key Personnel 4.2
Proposal 5
LNG Supply Pricing 5.1
Station Maintenance 5.2
Station Maintenance Pricing 5.3
Station Billing and Retailing (Option) 5.4
Appendix 6
City of San Bernardino
Comprehensive Liquefied Natural Gas Station Proposal
Clean Energy
Introduction
Clean Energy (CE) is pleased to provide the City of San Bernardino (City) with the
following proposal to supply and deliver Liquefied Natural Gas (LNG) fuel for its
fleet of natural gas powered vehicles. With a growing high-volume customer base,
CE understands the importance of providing the City with a secure and cost
effective LNG fueling source. CE has continued to increase its LNG customer
base since 2001 and we currently deliver over 140,000 gallons of LNG on a daily
basis to customers in Arizona, California, Idaho, New Mexico, Texas and Canada.
CE's qualifications and experience make us the industry leader in the supply of
LNG as a vehicle fuel.
r
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LNG Trailer Making Delivery to Phoenix Transit
City of San Bernardino
Comprehensive Liquefied Natural Gas Station Proposal
Clean Energy
Resources
2.1 LNG Production and Supply
As the largest and most experienced LNG fuel supplier in California, CE has the
proven ability to exceed the City's expectations. The City must meet daily roll-out
of its fleet of LNG powered refuse trucks. CE has maintained an excellent track
record and its partners have never missed roll-out due to fuel supply issues. In
order to further improve our service to the City, CE has begun building a new,
state-of-the-art LNG production facility in Boron, California. The new plant is
scheduled to come on-line during the 3rd Quarter 2008.
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Clean Energy's new Boron, California LNG Production Facility to
open 3`d Quarter 2008
The Boron plant will initially produce 160,000 gallons of LNG per day and have 1.5
million gallons of LNG on-site in a storage tank. This 1.5 million gallon storage tank
is the only LNG storage facility in the entire Southwest region of the United States
that is sizeable enough to maintain customer deliveries during production
disruptions. CE is the only LNG fuel provider that is making capital investments in
the LNG vehicle business to insure our customers of uninterrupted service.
In addition to the new Boron facility, CE signed an exclusive 10-year supply
agreement with Spectrum Energy Services (SES) to provide additional supply of
LNG. The agreement calls for SES to provide 100% of their production to CE
which initially starts at 45,000 gallons of LNG on a daily basis. The plant will be
located in Ehrenberg, Arizona and is scheduled to be completed during the
summer of 2008
City of San Bernardino
Comprehensive Liquefied Natural Gas Station Proposal
Clean Enemy
Plant Capacity and Fuel Specification Detail by Plant
CE has a number of LNG supply sources to pull from on a daily basis which
includes the following:
Williams Gas Processing Company Plant — Production capacity of 50,000
gallons of LNG per day and 80,000 gallons of LNG storage capacity.
ExxonMobil — Production capacity of 50,000 gallons of LNG per day and 80,000
gallons of LNG storage capacity.
BP Painter Plant— Production capacity of 40,000 gallons of LNG per week and
50,000 gallons of LNG storage capacity.
Pioneer Satanta Plant— Production capacity of 40,000 gallons of LNG per week
and 30,000 gallons of LNG storage capacity.
Pickens Plant— Production capacity of 100,000 gallons per day and 1,000,000
gallons of LNG storage capacity.
Clean Energy Boron Plant —When completed in 2008, production capacity will
be 160,000 gallons of LNG per day and 1,500,000 gallons of LNG storage
capacity.
Spectrum Energy Services Plant — When completed in 2008, production
capacity will be 45,000 gallons of LNG per day and 100,000 gallons of LNG
storage capacity.
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• BP Painter
William � + Pioneers
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City of San Bernardino
Comprehensive Liquefied Natural Gas Station Proposal
Clean Energy
2.2 LNG Delivery Management
As the largest LNG
fuel provider, CE is
confident in our
ability to provide
reliable and
consistent fuel
deliveries to the
City. CE has
multiple LNG fuel
sources to pull from
when making
deliveries to high
fuel use customers
who must meet a
critical rollout
window on a daily
basis. These Clean Energy's Seal Beach Operations Center
sources include
ExxonMobil,
Williams Company and BP, all of which produce LNG and offload to CE's fleet of
tanker trailers. CE has access to other plants operated by various local utilities,
which are available on an as needed basis, and our own LNG Plant in Willis,
Texas, which can produce over 100,000 gallons of LNG per day with over 1 million
gallons of onsite storage.
In fact, because of our ability to procure LNG fuel from a number of sources and
our large tanker fleet, CE on several occasions over the years has served as a
reliable backup supplier and made emergency deliveries to fleets under contract
with other LNG fuel providers. This took place most recently at a Waste
Management LNG station which had been run out of fuel by its supplier. Within a
six-hour window, CE was able to make an emergency delivery to ensure vehicles
met roll-out.
GPS Tracking and Fuel Inventory Monitoring
CE utilizes a GPS tracking system that allows us to monitor the progress of our
deliveries throughout the country. CE also maintains excess trailers and driving
teams in order to ensure our delivery schedule and prevent any missed schedules.
We have had a very successful track record in meeting customers' schedules for
deliveries. CE can maintain a remote inventory monitoring system which is linked
to the City's LNG station and allows CE personnel to ensure timely deliveries to
each station.
City of San Bernardino
Comprehensive Liquefied Natural Gas Station Proposal
f
Clean Energy
LNG Tanker Fleet
CE currently owns and operates a fleet of 58 LNG tankers: CE also leases two
additional LNG tankers giving us a fleet total of 60 tankers. These are all capable
of carrying 10,000 gallons at maximum gross weight. CE took delivery of 15 new
trailers in 2007.
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L/CNG Station at City of Tempe Transit Facility
City of San Bernardino
Comprehensive Liquefied Natural Gas Station Proposal
Clean Energy
Qualifications and Experience
3.1 Company Profile
During the past few years, CE has grown significantly by making strategic
acquisitions and building new infrastructure throughout North America. CE is
North America's largest natural gas vehicle fuel provider both in number of stations
and gallons sold per year. Today CE owns and operates over 180 natural gas
fueling stations with a broad customer base in the transit, refuse, shuttle, taxi,
intrastate and interstate trucking, airport and municipal fleet markets. CE was
formed in 2001, originally under the name ENRG, and currently employs over 125
people. CE has offices in Arizona, California, Colorado, District of Columbia,
Georgia, Texas, Washington, Massachusetts, as well as Vancouver and Toronto,
Canada.
CE is proud to be the natural gas fuel provider for other large volume LNG fleets
including CR&R, City of Bakersfield, City of Fresno, City of Phoenix, City of
Sacramento, City of Tempe, City of Tulare, County of Sacramento, Dallas Area
Rapid Transit, Harris Ranch Feeding Company, Los Angeles World Airports,
Omnitrans, Santa Monica's Big Blue Bus, and Sun Metro. CE also fuels a number
of large volume Compressed Natural Gas (CNG) fleets including Foothill Transit,
North County Transit District, RPTA/Mesa, San Diego Transit, Santa Clarita
Transit and Boston's MBTA. Having provided LNG and CNG fueling services to
thousands of fleet customers on a daily basis, CE understands the City's proactive
alternative fuel policy and welcomes the opportunity to develop a long-term
partnership.
City of San Bernardino
Comprehensive Liquefied Natural Gas Station Proposal
eu
Clean Enemy
3.2 Client References
City of Santa Monica, Big Blue Bus
The City currently operates over 100 LNG powered transit buses and a number of
light and medium-duty natural gas vehicles. The LCNG fueling facility includes two
30,000 gallon LNG tanks. CE and the transit department executed an exclusive
LNG supply contract on February 14, 2006 which includes a term of up to four
years.
Ralph Merced
Transit Maintenance Manager
612 Colorado Ave.
Santa Monica, CA 90401
(310) 458-1975 ext. 5865 .
merced(o-)smqov.net
o
LNG Transit Buses at Big Blue Bus
Yard in Santa Monica
City of El Paso, Sun Metro
The City of El Paso, Texas currently operates over 150 LNG powered transit
buses. In 2007, Clean Energy delivered over 4,600,000 Gallons of LNG to Sun
Metro's fueling facilities. CE and the transit department executed an exclusive
LNG supply contract on December 13, 2003 which includes a term of five years.
Kevin Bunce
Assistant Director -Transit Operations and Maintenance
700-A San Francisco
El Paso, TX 79901
(915) 534-5830
bunceke(a)-ci.el-paso.tx.us
City of San Bernardino
Comprehensive Liquefied Natural Gas Station Proposal
Clean Energy
Los Angeles World Airports
CE entered into an exclusive three-year LNG supply agreement with the Los
Angeles World Airports to deliver all of its LNG fuel needs at the Los Angeles
International Airport (LAX) LCNG station. The facility fuels over 80 buses
(standard size and articulated) as well as hundreds of other light, medium and
heavy-duty natural gas vehicles. The contract was awarded on September 6,
2006 and runs through September 5, 2009.
David Waldner
Assistant Chief of Airports Construction and Maintenance
7411 World Way West
Los Angeles, CA 90045
(310) 646-3263
City of Tulare
On July 1, 2005 the City awarded a two-year LNG supply agreement to CE for
exclusive fuel deliveries to its 15,000 gallon LCNG station. The contract included
two successive one-year renewal options with the first renewal being exercised on
July 1, 2007. There are approximately 20 CNG powered transit buses, 15 CNG
and LNG powered refuse trucks and several other light-duty CNG vehicles utilizing
the facility in addition to third parties traveling through the San Joaquin Valley.
Lew Nelson
Public Works Director
3981 South "K" Street
Tulare, CA 93274
(559) 684-4318
Inelson(cDci.tulare.ca.us
City of Fresno
The City awarded CE an exclusive two-year supply contract which began on
November 4, 2005. Currently, CE is delivering LNG fuel under a six-month
extension to a fleet of over 80 LNG powered refuse trucks. The LNG facility
consists of one 15,000 tank and two 6,000 gallon tanks for a total capacity of
27,000 gallons.
Joseph Oldham
Acquisition Supervisor
2101 "G" St., Bldg. "F"
Fresno, CA 93706
(559) 621-1106
Joseph.old ham(c-)fresno.gov
City of San Bernardino
Comprehensive Liquefied Natural Gas Station Proposal
aean En&W
Organization and Staffing
4.1 Organizational Chart
Andrew J. Littlefair
President and CEO
Brian Powers James N.Harger
Assistant Vice President, Senior VP,Marketing&
Operations Sales
Tom Bressler Chad Lindholm
Operations Manager Regional Manager, SoCal
and Arizona
Christa Pc Les Stinson
Logistics Manager, Inland Empire
LNG L Account Manager
LNG Operations Team
City of San Bernardino
Comprehensive Liquefied Natural Gas Station Proposal
Man fnevgy-
4.2 Key Personnel
Andrew Littlefair, President and CEO
3020 Old Ranch Parkway, Suite 200
Seal Beach, CA 90740
(562) 493-2804 phone
(562) 493-4532 fax
alittlefair(a�cleanenergyfuels.com
Brian Powers, Assistant Vice President of Operations
3020 Old Ranch Parkway, Suite 200
Seal Beach, CA 90740
(562) 493-2804 phone
(562) 493-4532 fax
bpowers cleanenergyfuels.com
James Harper, Senior Vice President of Marketing
I 3020 Old Ranch Parkway, Suite 200
Seal Beach, CA 90740
(562) 493-2804 phone
(562) 493-4532 fax
iharger(a�cleanenergyfuels.com
Chad Lindholm, Regional Manager— Southern California &Arizona
3020 Old Ranch Parkway, Suite 200
Seal Beach, CA 90740
(562) 493-2804 phone
(562) 493-4532 fax
clindholm(a-),cleanenergyfuels.com
Les Stinson, Account Manager— Inland Empire
3020 Old Ranch Parkway, Suite 200
Seal Beach, CA 90740
(562) 493-2804 phone
(562) 493-4532 fax
Istinson(a)cleanenergyfuels.com
City of San Bernardino
Comprehensive Liquefied Natural Gas Station Proposal
Clean Energy
Tom Bressler, Operations Manager
23020 Old Ranch Parkway, Suite 200
Seal Beach, CA 90740
(562) 546-0337 phone
(562) 546-0137 fax
tbressler(a�cleanenergVfuels.com
Christa Peila, Logistics Manager, LNG
3020 Old Ranch Parkway, Suite 200
Seal Beach, CA 90740
(562) 493-2804 phone
(562) 493-4532 fax
cpeila(@cleanenergyfuels.com
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L/CNG Station at Sanitation Districts of
Los Angeles County Puente Hills Landfill
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Private LCNG Station at LAX
City of San Bernardino
Comprehensive Liquefied Natural Gas Station Proposal
Clean Enenjr
Proposal
5.1 LNG Supply Pricing
CE is prepared to offer the City the following LNG supply pricing proposal:
Price Proposal
Delivered Price $0.62
SoCal Border Index SoCal Border
Applicable Taxes Taxes
Notes:
1. Index Price per MMBTU (million British Thermal Units)/12.1 = Price per LNG
Gal.
2. For example, the SoCal Border for the month of February is $7.60 per MMBTU,
which is the equivalent of$0.63 per LNG Gal. ($7.60/12.1). Thus, the City's
total fuel price for the month of June would be $1.25 per LNG Gal. ($0.62 +
$0.63).
3. An LNG Gal. is defined as 3.49 pounds of LNG.
4. The Product Price does not include any applicable federal, state or local taxes
and fees (if applicable), which will be added to the price to determine a final
deliverable cost of Product.
5. A diesel surcharge will apply when the average monthly diesel cost published
by the U.S. Department of Energy (DOE) is higher then $3.50 per Gal
6. The SoCal Border is published monthly in Platt's Inside FERC publication. To
get the monthly index price per Gal., take the applicable index price per
MMBTU (million British Thermal Units) divided by 12.1.
Volumetric Excise Tax Credits
CE spear-headed and was successful in getting natural gas tax provisions
included under the 2005 Energy Bill, which provide a $0.50 per gallon tax credit on
LNG fuel. The tax credit will equate into a significant cost reduction to the City's
overall operating budget. CE's proposed pricing structure excludes any discount
as a result of the tax credits and we will assume the City is to apply for and receive
these tax credits separately. We will provide our assistance and guidance to
ensure the available tax credits are received by the City.
City of San Bernardino
Comprehensive Liquefied Natural Gas Station Proposal
Clean Energy
5.2 Station Maintenance
Description of Maintenance Services
CE is very familiar with CNG and LNG station operations and maintenance. As an
operator of the largest network of natural gas stations in North America, we
dispense more than 200,000 gallons daily. CE has built a reputation in the natural
gas fueling industry for having the most qualified staff to operate and maintain our
network of fueling stations, handle customer service, prepare accurate bills, and
market our products and services. CE will continue this tradition with the City by
providing a reliable fueling station to serve current and future clean burning fleets.
Preventative Maintenance
• CE will follow all of the manufacturer's recommendations for preventative
maintenance including all equipment inspections.
• CE will track station operations through a maintenance management
system that will monitor all major components of the station.
• CE will hold weekly maintenance meetings to discuss station performance
and resolve operational issues.
Unscheduled/Emergency Maintenance
• Station callout — in the unlikely event a station goes down for an ESD or
other predetermined issue, the maintenance technician on-duty will be
dispatched.
• A CE maintenance technician will be on call 24 hours a day, 7 days a week,
365 days a year.
• The City will all have access to other CE fueling stations in the network,
which provides a reliable backup fueling source.
Service Technician Team
CE currently employs 13 full time maintenance technicians and one cleaning
technician that are based in the Los Angeles/Orange/Riverside/San Bernardino
Region. Our technician team assures a quick response time in the event of
unscheduled maintenance and first class station appearance. Our maintenance
technicians are assisted by two Operations Coordinators, an Operations Manager
and our Assistant Vice President of Operations.
City of San Bernardino
Comprehensive Liquefied Natural Gas Station Proposal
Clean Enemy
Station Maintenance Program
CE's Computerized Maintenance Management System
(CMMS) will be used at the City L/CNG station to ensure
equipment reliability and performance. The program's
monthly maintenance reports show maintenance tasks,
major/minor repairs and hours logged in addition to the
following:
• Manages inventory and orders parts
• Tracks hours and specific maintenance work orders
• Provides complete history profile of equipment
• Provides detailed reports on a monthly basis
Spare Parts Inventory
CE stocks over $1.8 million in spare parts at our
maintenance facility in Santa Fe Springs as well as in the Mobile Devicee
Handhelld d Devices
s
trucks of our service technicians. This will ensure that
important equipment parts are readily available to keep the
station up and running.
5.3 Station Maintenance Pricing
CE is prepared to offer a price per LNG gallon inclusive of all labor, supervision,
spare and replacement parts, maintenance equipment, consumables, supplies,
transportation and all overheads including insurance and profit. Basing
maintenance pricing on a "per gallon" fee ensures accurate pricing reflective of
actual station usage. It also protects the City on unforeseen volume increases or
decreases over the next several years.
Station Maintenance Cost per LNG Gallon
24/7 Service $0.15
CE wishes to further discuss and clarify the following with the City:
Station maintenance excludes any repairs that are covered under the
manufacturers' warranty. CE understands that the manufacturers' warranty is for a
one-year period commencing on the date the station is officially accepted by the
City. CE's station maintenance pricing excludes costs associated with the
M ultiforce/Fuel Force card reader system, Greenfield CNG dispenser video panel
and LNG pump rebuilds (note —typical LNG pump life is three years). Damage to
LNG and CNG hoses and nozzles due to drive-aways will be paid for by the City.
City of San Bernardino
Comprehensive Liquefied Natural Gas Station Proposal
Clean Energy
5.4 Station Billing and Retailing (OPTION)
As an option to the City, CE has the ability to operate the LCNG station and
provide all billing, retailing, customer service and interface with the
Multiforce/FuelForce card reader system. Card reader system and CNG dispenser
video panel potential maintenance and labor costs will be covered by CE under
this option. The City will not be charged for this service.
** Furthermore, CE will provide the City with a $0.05 per gallon royalty in addition
to crediting back the cost for fuel on each gallon of natural gas sold to all non-city
vehicles. This arrangement will provide the City with a guaranteed revenue stream
while putting the risk for station operations, billing, retailing and customer service
on CE.
CE's customer service r
representatives are
available from 7 AM — 8PM
everyday and happy to aid
each customer with fuelingQ `
needs. Our accounting staff is ;
will provide records of all
CNG and LNG transactions,
bill customers, collect
payments, and reimburse '
the City for all fuel
dispensed to non-city
vehicles. The existing
accounts-receivable and t "
accounts-payable systems
provide these services on a
daily basis for over 30,000
transactions. i.
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City of San Bernardino
Comprehensive Liquefied Natural Gas Station Proposal
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Clean Energy
Appendix
Clean Energy Begins Construction on LNG Plant in California
First Commercial LNG Plant in California to Serve Growing Demand
from Heavy-Duty Natural Gas Vehicle Fleets, including Los Angeles Ports
Seal Beach, CA (Sept. 13, 2007) — Clean Energy Fuels Corp. (Nasdaq: CLNE) has begun
construction on California's first, large-scale LNG (liquefied natural gas) production plant in the
Mojave Desert, approximately 75 miles northeast of Los Angeles. The plant is scheduled to begin
commercial shipments in the second half of 2008.
"This plant is a major step in our preparing to fuel potentially thousands of additional buses and
trucks with natural gas as a result of increasing commercial demand and of new measures
instituted by the California Air Resources Board and the Ports of Los Angeles and Long Beach for
cleaner vehicles," said Andrew J. Littlefair, president and CEO.
Natural gas is one of the cleanest burning fuels available, Littlefair noted. Natural gas vehicles
emit significantly less greenhouse gas and pollution than vehicles fueled by diesel or gasoline.
At the new plant, Clean Energy will liquefy pipeline gas for shipment to customers by tanker
trailers. Initial production capacity is anticipated to be 160,000 LNG gallons per day, which will
be delivered for use by vehicle fleets throughout California and the Southwest. The facility can
be expanded to a production capacity of 240,000 gallons per day. The plant will also have LNG
storage capacity of 1.5 million gallons.
About Clean Energy
Clean Energy, based in Seal Beach, CA, is the leading provider of natural gas (CNG and LNG) for
transportation in North America. It has a broad customer base in the refuse, transit, shuttle,
taxi, intrastate and interstate trucking, airport and municipal fleet markets, fueling more than
14,000 vehicles daily at strategic locations across the United States and Canada. Information at:
www.cleanenerpyfuets.com
Safe Harbor Statement
This press release contains forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933 and Section 21 E of the Securities Exchange Act of 1934 that involve risks,
uncertainties and assumptions. Actual results and the timing of events could differ materially
from those anticipated in these forward-looking statements, including the financial impact of
unanticipated project delays, higher than anticipated construction costs and delays in the
demand for LNG as a vehicle fuel. The forward-looking statements made herein speak only as of
the date of this press release and the company undertakes no obligation to publicly update such
forward-looking statements to reflect subsequent events or circumstances.
Contacts
News Media
Bruce Russell, 310/559-4955, ext. 101
brussell@cleanenerQyfuels.com
City of San Bernardino
Comprehensive Liquefied Natural Gas Station Proposal
)
ObanFneW-
Clean Energy Signs Deal to Increase LNG Resources in Southwest
10-Year Agreement to Help Supply Growing Transportation Fuel Demand in AZ and CA -
Seal Beach, Calif. (October 25, 2007) - Clean Energy Fuels Corp. (Nasdaq: CLNE) has entered into
an LNG sales agreement with Spectrum Energy Services, LLC (SES), an Alaska limited liability
company, to purchase, on a take-or-pay basis over a term of 10 years, 45,000 gallons per day of
liquefied natural gas (LNG) from a plant to be constructed by SES in Ehrenberg Arizona, which is
near the California border. The plant is anticipated to be in full production in the summer of
2009.
The LNG from the plant will be used to help support Clean Energy's supply agreements with
customers in Arizona and California.
"Demand for natural gas for transportation is growing steadily, particularly in the Southwest, for
the transit, refuse and emerging ports markets," said Andrew J. Littlefair, Clean Energy president
and CEO. "This new supply agreement will supplement our resources needed to fuel the growth."
"The Ports of Los Angeles and Long Beach alone have developed a plan that envisions the addition
of 5,300 heavy-duty LNG trucks for goods movement at the ports within five years," noted
Littlefair. "Clean Energy has committed to be a major supplier to that initiative and already has
LNG fueling stations under construction and design."
Clean Energy is building its own LNG production plant in the California desert that is planned to
begin delivering up to 160,000 gallons of LNG per day in late 2008. The plant is designed to be
able to increase production up to 240,000 gallons of LNG per day as demand grows further.
About Clean Energy
Clean Energy is based in Seal Beach, Calif., and is the leading provider of natural gas for
transportation in North America. It has a broad customer base in the refuse, transit, shuttle,
taxi, intrastate and interstate trucking, airport and municipal fleet markets, fueling more than
14,000 vehicles daily at strategic locations across the United States and Canada. Information at:
www.cleanenerpvfuels.com
Forward-Looking Statement
This press release contains forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933 and Section 21 E of the Securities Exchange Act of 1934 that involve risks,
uncertainties and assumptions. Actual results and the timing of events could differ materially
from those anticipated in these forward-looking statements, including the ultimate timing and
production capacity of the new plant and the demand for LNG in the Southwestern United States,
and other factors more fully described in the company's recent Form 10-Q and Initial Public
Offering Prospectus filings with the Securities and Exchange Commission. The forward-looking
statements made herein speak only as of the date of this press release and the company
undertakes no obligation to publicly update such forward-looking statements to reflect
subsequent events or circumstances.
Contacts -
News Media
Bruce Russell, 310/559-4955, ext. 101
brussetl@cteanenerp,yfuets.com
City of San Bernardino
Comprehensive Liquefied Natural Gas Station Proposal