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Home My WebLink About04.b. Review draft Position Paper to authorize the General Manager to execute a technical consulting services agreement in an amount not to exceed $1,078,000 with Montrose Air Quality Services, LLC to provide treatment plant emissions testing services fo Page 1 of 6 Item 4.b. CENTRAL SAN BOARD OF DIRECTORS POSITION PAPER DRAFT MEETING DATE: JUNE 1, 2022 SUBJECT: REVIEW DRAFT POSITION PAPER TO AUTHORIZE THE GENERAL MANAGER TO EXECUTE ATECHNICAL CONSULTING SERVICES AGREEMENT IN AN AMOUNT NOT TO EXCEED $1,078,000 WITH MONTROSE AIR QUALITY SERVICES, LLC TO PROVIDE TREATMENT PLANT EMISSIONS TESTING SERVICES FORA FIVE-YEAR PERIOD COVERING FISCAL YEARS 2022-27; AND FIND THE AGREEMENT IS EXEMPT FROM THE CALIFORNIA ENVIRONMENTAL QUALITYACT SUBMITTED BY: INITIATING DEPARTMENT: RITA CHENG, REGULATORY COMPLIANCE ENGINEERING AND TECHNICAL SERVICES- PROVISIONAL SENIOR ENGINEER ERC-REGULATORY COMPLIANCE REVIEWED BY: LORI SCHECTEL, ENVIRONMENTALAND REGULATORY COMPLIANCE DIVISION MANAGER JEAN-MARC PETIT, DIRECTOR OF ENGINEERINGAND TECHNICAL SERVICES ISSUE The Board of Directors'authorization is required for the General Manager to execute a technical consulting services agreement in an amount greater than $200,000. BACKGROUND Central Contra Costa Sanitary District (Central San) is required to perform annual compliance emissions testing on the multiple hearth furnaces, cogeneration, and auxiliary boilers in accordance with federal, state, and local requirements. Although Central San has an onsite laboratory, the Bay Area Air Quality Management District (BAAQMD) does not allow a facility to conduct its own compliance tests due to conflict of interest restrictions and requires the use of third parties to perform compliance emissions testing in accordance with standardized federal and state testing methods. This applies not only to public agencies like Central San but also to industrial facilities. I n addition, this type of testing requires a set of specialized skills and highly specialized equipment, sampling, and testing. Central San is required to complete several emissions tests on an annual basis to comply with all applicable regulatory requirements. As required by the Clean Air Act Section 129 Sewage Sludge Incinerator Regulations, Title V Major Facility Review Permit, and the BAAQMD Permit-to-Operate, the June 1, 2022 EOPS Regular Committee Meeting Agenda Packet- Page 301 of 320 Page 2 of 6 online multiple hearth furnace is required to complete an annual emissions test to demonstrate compliance with emission limits for organic compounds, particulate matter, sulfur dioxide, hydrogen chloride, carbon monoxide, dioxins/furans, nitrogen oxides, mercury, cadmium, and lead. Every five years, the furnaces are required to test for additional metals to comply with the five-year Title V Major Facility Review Permit requirement. Additionally, the treatment plant's Title V Permit and BAAQMD Permit-to-Operate require routine emissions testing. The cogeneration turbine is required to demonstrate compliance with a carbon monoxide emission limit annually, and Central San is required to measure formaldehyde emissions after catalyst replacement, which is currently scheduled for Fiscal Year(FY) 2023-24. The auxiliary steam boilers are required to demonstrate compliance annually with organic compounds, nitrogen oxides, and carbon monoxide emission limits. To cover the funding of any unanticipated air emissions testing services needed to demonstrate compliance, mitigate a potential compliance issue, and/or prepare for upcoming regulatory requirements, staff recommends adding a contingency amount in the proposed agreement to cover contingency emissions testing services. The estimated FY 2023-24 cost includes engineering evaluations and compliance emissions tests required for installation of the new wet scrubbers on both multiple hearth furnaces under the Solids Handling Facility Improvements, Phase 1A, District Project (DP) 7348. Due to the uncertain nature of new equipment installation, staff recommends including $186,000 to FY 2023-24 contingency to cover any additional engineering evaluations and compliance testing. Staff is also proposing to include no more than $26,000 of contingency in each of the remaining fiscal years. I n March 2022, Central San issued a Request for Proposals (RFP)on PlanetBids to select a qualified emissions testing firm to provide emissions testing services and received proposals from Montrose Air Quality Services, LLC (Montrose) and Elemental Air, LLC. Staff is also aware of other testing firms in the local region, but these smaller firms do not have the full capability to perform all the required emissions testing. Staff recommends selecting Montrose to perform the proposed emissions testing services considering Montrose's qualifications, California testing experience, and past performance. Montrose is currently under contract to provide emissions testing services for FYs 2019-22. The company or its staff currently holds the following certification or accreditations: • California Air Resources Board Approval of Independent Contractor Certification; • Accredited Air Emission Testing Body issued by American Association for Laboratory Accreditation and Stack Testing Accreditation Council, Inc; and • Qualified Source Testing Individual issued by Source Evaluation Society California Environmental Quality Act(CEQA) Staff has concluded that this agreement is exempt from CEQA under District CEQA Guidelines Section 15301 since it analyzes the performance of an existing public facility. Approval of this agreement will establish the Board of Directors' independent finding that this agreement is exempt from CEQA. ALTERNATIVES/CONSIDERATIONS The Board could decide to reject the proposal, but based on the qualifications at this time, staff would likely not receive additional proposals if the RFP was republished. Therefore, staff does not recommend this alternative. A second alternative would be to continue developing individual agreements for each emissions testing project. However, staff does not recommend this approach as contract development has proven to be time consuming, and there is a lack of qualified, local emissions testing firms that can support Central June 1, 2022 EOPS Regular Committee Meeting Agenda Packet- Page 302 of 320 Page 3 of 6 San's needs. FINANCIAL IMPACTS The total estimated cost for the agreement is $1,078,000 over a five-year period (FYs 2022-27), which includes $286,000 for contingency emissions testing services. Of the $286,000 contingency, $186,000 was included for FY 2023-24 to cover any potential additional engineering and compliance testing needed during the new wet scrubber installations. The estimated fiscal year cost breakdown of the proposed agreement is: FY 2022-23 Emissions Testing and Contingency Testing: $119,000 FY 2023-24 Emissions Testing and Contingency Testing: $586,000* FY 2024-25 Emissions Testing and Contingency Testing: $122,000 FY 2025-26 Emissions Testing and Contingency Testing: $124,000 FY 2026-27 Emissions Testing and Contingency Testing: $127,000 FYs 2022-27 ESTIMATED TOTAL: $1,078,000 *The costs of the furnace pre-testing and compliance emissions tests needed for the new wet scrubbers are included as part of FY 2023-24 and will be capitalized under DP 7348. The remaining scope items in the agreement will be funded by the Environmental and Regulatory Compliance Division under the Regulatory Compliance section's FYs 2022-27 budgets. COMMITTEE RECOMMENDATION The Engineering & Operations Committee has reviewed this subject at its meeting on June 1, 2022 and recommended RECOMMENDED BOARD ACTION Staff recommends the following Board actions: 1. Find the agreement is exempt from CEQA; and 2. Authorize the General Manager to execute a technical consulting services agreement in an amount not to exceed $1,078,000 with Montrose Air Quality Services, LLC to provide emissions testing services for a five-year period covering Fiscal Years 2022-27. Strategic Plan Tie-In GOAL TWO:Environmental Stewardship Strategy 1—Achieve 100%compliance in all regulations, Strategy 2—Anticipate and prepare for potential regulatory changes ATTACHMENTS: 1. Presentation June 1, 2022 EOPS Regular Committee Meeting Agenda Packet- Page 303 of 320 Item 4.15. Updated Presentation from meeting T `1 T -+ TREATMENT PLANT EMISSIONS TESTING SERVICES AGREEMENT - Engineering &Operations Committee June 1,2022 Meeting y�a Presented by: Rita Cheng, PE Regulatory Compliance Provisional Senior Engineer 1 REGULATORY REQUIREMENTS FOR MULTIPLE HEARTH FURNACES Air District (BAAQMD) and Environmental Protection Agency require annual and five-year emissions testing on the furnaces: • Clean Air Act Section 129 Sewage Sludge Incinerator Regulations • Annual requirement—carbon monoxide, nitrogen oxides, sulfur dioxide, hydrogen chloride, dioxins/furans, mercury, cadmium, lead, and particulate matter • Title V Major Facility Review Permit • Annual requirement—organic compounds, sulfur dioxide • Five-year requirement—additional metals ' 2 2 1 REGULATORY REQUIREMENTS FOR TREATMENT PLANT EMISSIONS TESTING BAAQMD requires annual emissions testing to demonstrate compliance: Cogeneration — carbon monoxide and formaldehyde (post-catalyst installation only) Auxiliary Boilers — carbon monoxide, nitrogen oxides, and organic compounds F, 3 3 PROPOSED EMISSIONS TESTING AGREEMENT March 2022 — Issued Request for Proposals Selected Montrose based on qualifications, California testing experience, and past performance Regulatory is proposing to continue multi-year agreements to streamline contract development Total estimated cost: Fiscal Year Cost Breakdown FY 2022-23 Emissions Testing $119,000 FY 2023-24 Emissions Testing $586,000* FY 2024-25 Emissions Testing $122,000 FY 2025-26 Emissions Testing $124,000 Includes additional furnace FY 2026-27 Emissions Testing $127,000 * emissions tests and$186k $1,078,000 contingency for the anticipated FY 2022-27 TOTAL (Includes$286k new scrubbers to be installed as contingency) part of DP 7348 Solids Project 4 4 2 RECOMMENDATION Authorize the General Manager to execute a technical consulting services agreement with Montrose in an amount not to exceed $1 ,078,000 to provide treatment plant emissions testing services for a five-year period covering FYs 2022-27. F: 5 5 QUESTIONS f:. 6 6 3