CITY AND COUNTY OF SAN FRANCISCO
BIODIESEL ACCESS TASK FORCE
THURSDAY, OCTOBER 19, 2006, 10:00 A.M.
TASK FORCE MEMBERS: VOTING: Eric Bowen (Chair), Adam Hagen (Vice-Chair), Melissa Hardy, Benjamin Jordan, Karri Ving. NON-VOTING: David Augustine (Treasurer/Tax Collector), Richard Berman (Port), Sarah Dennis (Planning Department), Kevin Drew (Department of the Environment), Mike Ferry (Fire Department), Tom Franza (SFPUC), Laurence Kornfield (DBI), Jennifer Matz (MOCD), Marty Mellera (MTA), Virginia St. Jean (DPH).
TASK FORCE SECRETARY: Monica Fish
ORDER OF BUSINESS
1. CALL TO ORDER AND ROLL CALL
The meeting was called to order at 10:12 a.m. Present: Members Bowen, Hagen, Jordan, Ving, Augustine, Berman, Ferry, Franza (Substitute: Steve Medbery); Matz (Substitute: Dina Mackin). Excused: Members Drew, Mellera, and St. Jean; Absent: Members Dennis, Kornfield, and Hardy.
Chair Bowen introduced Dina Mackin, the Mayor’s Office new Clean Tech staff member, will be replacing Jennifer Matz from the Mayor’s Office of Community Development as a Task Force member. Ms. Mackin explained that her assignment includes reviewing the City’s policies and programs on renewable energy and other forms of environmental technologies and supporting the growth of these companies and their location in San Francisco. The goal is to bring together the City’s programs and policies with economic development.
Members introduced themselves. Member Ferry reported that he is running the biodiesel pilot program for the Fire Department that is approaching Phase 2 of the project. It was stated that there are unresolved issues with San Francisco Petroleum, issues with one underground diesel tank, and an ongoing issue with a ladder truck that they are trying to resolve.
2. ACTION: Approval of the September 21, 2006 Regular Meeting Draft Minutes. Upon Motion by Member Hagen and second by Member Ving, the September 21, 2006 Meeting Minutes were approved with no objection. (Absent: Member Hardy) (Explanatory Document: September 21, 2006 Approved Minutes.)
3. DISCUSSION and ACTION: Draft Resolution File No. R-2006-03-BDTF amending the Biodiesel Access Task Force Bylaws by adding Article VI “Task Force Committees”, Sections 1 - 8 to (1) establish a new standing Committee called the Marine Committee, (2) establish the Committee process; and to change the numbering of current Articles VI – IX to Articles VII – X (Explanatory Documents: Notice of Proposed Amendment to Bylaws and Resolution File No. R-2006-03-BDTF and Amended Bylaws 101906).
SPONSOR and SPEAKER: Eric Bowen, Chair
Chair Bowen reported that at the September 21, 2006 meeting, the Task Force agreed that it would be worth the Committee’s time and resources to form a Marine Committee to focus specifically on access issues in the marine environment. Mr. Berman, Port Representative, has been working with Port staff to see who would be interested in being part of the Committee and arranging for a meeting room. Task Force members will be inviting members of the current marine fueling community, General Petroleum, Golden Gate Petroleum, and San Francisco Petroleum to participate in the Task Force because it will be a private sector company that will be providing biodiesel for marine access. One of the objectives would be to bring resources of the City and Port together to match demand and supply.
Upon Motion by Chair Bowen and second by Vice-Chair Hagen, Resolution File No. R-2006-03-BDTF was adopted with no objection to establish a new Standing Committee and the Committee process (Absent: Member Hardy).
4. DISCUSSION and ACTION: Appointment of Members to the Biodiesel Marine Committee.
SPONSOR: Eric Bowen, Chair
Member Berman reported that two to four Port members might be interested in participating in the Committee. Ms. Ving expressed her interest and recommended that the Port Authority, yachts people, and Mr. Randall von Wedel be recruited to serve on the Committee. Chair Bowen inquired as to how ferries are regulated. Member Berman advised that the Water Transit Authority and Coast Guard have regulatory authority. It was stated that ferries should be represented.
Upon Motion by Member Jordan and second by Member Ving with no objection, five voting members consisting of two voting Task Force members (Chair Bowen and Member Ving), one non-voting Task Force Member representing the Port (Member Berman) and two at large citizen or government agency appointees who will be selected by the Marine Committee at a future meeting were selected for appointment to the Biodiesel Marine Committee (Absent: Member Hardy).
5. DISCUSSION and ACTION: The Task Force discussed creating and adopting a policy regarding members’ attendance at Task Force Meetings pursuant to Board of Supervisors Resolution No. 502-06 (Explanatory Documents: Board of Supervisors Resolution No. 502-06).
SPEAKER: Monica Fish, Commission Secretary
Ms. Fish advised that the City Attorney’s Office is working on creating an attendance template and asked if the Task Force would like to continue this item to the November 16, 2006 meeting in order to consider the template as a basis for their attendance policy.
Upon Motion by Chair Bowen and second by Vice-Chair Hagen with no objection, the Task Force agreed to continue this item to the November 16, 2006 meeting in order to consider the City Attorney’s Office attendance template (Absent: Member Hardy).
6. INFORMATIONAL REPORT. Update on Expression of Interest from Gas Stations on the Installation of Biodiesel Pumps.
SPEAKER: Adam Hagen, Vice Chair
Vice-Chair Hagen reported that the Service Station and Repair Association are willing to send a joint communication from the Task Force and their organization to (1) target gas stations with a current diesel tank urging them to switch over to a biodiesel tank and (2) a second communication to go out to all the gas stations who don’t have diesel and offering them a propane model biodiesel solution. Member Augustine asked if the letter would be offering technical assistance. Vice-Chair Hagen stated that the first communication would be a survey to see what the interest level is. Chair Bowen introduced Ms. Anna Halpern-Lande, a partner in San Francisco Biodiesel and Tellurian Biodiesel who would be drafting the letter to the Service Station and Repair Association.
Ms. Halpern-Lande reported that Tellurian Biodiesel is working with biodiesel in San Francisco reaching out to petroleum distributors to encourage them to put biodiesel in their car lock systems. Main topics discussed included:
· A B20 blend will be available for all fleets and private individuals at two stations, one at the Olympian Station on 23rd and 3rd Streets and the other on Grand and Gateway near Brisbane.
· Long term plan is for stations to install blending dispensers so three blends can be offered, B5, B20 and B99. At this time, only B20 is being offered.
Chair Bowen reported that B20 is not required to be part of the variance program because it is not an experimental fuel as B99.
Task Force Members discussed ways of publicizing and promoting the stations to make it a success. Recommendations included local media coverage, a press event that would include lining up various vehicles at the stations, a press release, inviting the Mayor and Board of Supervisors to the stations.
Ms. Halpern-Lande stated that biodiesel dispensers would cost about $30,000 a piece and inquired about incentives that will be discussed in the next agenda item.
Chair Bowen discussed the Environmental Justice program, Green Depot, to encourage biodiesel in the Bayview Hunters Point area to reduce particulate matter emissions. It was stated that grant paperwork was ready, but that they were having difficulty finding reasonably priced insurance that meets the City’s insurance requirements.
Vice-Chair Hagen reported on state incentives. The Clean Air Resources Board has a $25 million grant from the federal government for an alternative fuel program. A public hearing was held in order to receive feedback on how money was distributed. It was reported that ethanol is receiving $10 million and biodiesel is receiving $5 million. The public inquired as to why so much money was allocated to ethanol and not to biodiesel. The general answer was that they could easily track ethanol vehicles in certain areas. Their plan was to create a handful of ethanol gas stations in high concentration areas of ethanol vehicles to see how the economic model would play out. Vice-Chair Hagen stated that large constituents of ad related people were advocating for some of the money to go towards fuel props, research, and distribution. Funds were not available for what the Task Force is working on, but lots of people were speaking up for biodiesel.
Chair Bowen reported that Mr. Robbie Long, Propel Fuels, who gave an update on his company at a previous Task Force meeting and their effort in Washington State to convert gas stations to biodiesel, is eager to move forward in San Francisco and would take names of people who expressed interest. . It was stated that Propel Fuels is one of the most successful in the west coast in this effort. Their business’ focus includes removing hurdles to put in biodiesel at gas stations by offering above-ground solutions as the biggest hurdle in most gas stations is that they do not have an existing underground diesel tank to transition to a biodiesel tank.
Public Comment: Mr. Silberstein stated that he would refer the Task Force to a news reporter who provides local coverage.
Public Comment: Ms. Laura Castellini stated that the Golden Gate National Recreation Area is waiting for a gas station biodiesel tank in the west end of the City or Lombard Street and inquired about options for delivery or remote service. It was stated that GGNRA is under a federal mandate to use alternative fuels and that most vehicles at this time use ethanol.
7. DISCUSSION AND POSSIBLE ACTION: Continued Discussion on Recommendations to the Board of Supervisors on Incentives for Gas Stations to Include Biodiesel Pumps (Continued from the September 21, 2006 Meeting).
SPEAKER: Member Augustine
Member Augustine reported that businesses that have a payroll of more than $166,000 pay a payroll tax to the City of 1.5% of their payroll annually. It was determined that there are not a significant number of businesses that have a payroll over $166,000 that a payroll tax exclusion could be offered to. The group that does have a payroll of more than $166,000 pays a substantial payroll tax of an average of $5700 a year to the City. It was stated that tax exclusions would only apply to half the businesses and is a limiting factor.
Options other than payroll tax exclusions were discussed. Member Augustine stated that Member St. Jean spoke about city and state fees and fee structures imposed on stations that could be waived. It was suggested that a direct subsidy to businesses that put in the equipment be considered. This would require the Board of Supervisors to authorize the City to pay those businesses a certain amount of money. The subsidy would be applicable to all businesses, not some over the other. Member Augustine recommended fee reductions and subsidies over payroll tax exclusions, but stated that a subsidy may be more difficult to attain.
An inquiry was made as to whether there are any subsidies that have been issued by the state or federal government. Chair Bowen reported that there is a 30% tax credit of up to $30,000 for renewable fuel infrastructure which is deductible against income through the Internal Revenue Service instituted as part of the 2005 Energy Bill.
A recommendation was made that banks be approached to offer gas station owners low-cost loans to install biodiesel equipment. In turn, the banks could take advantage of tax credits that come with lending for renewable energy purposes. Ms. Ana Halpern-Lande suggested that the City offer loan guarantees through its primary banking relationships. Member Augustine stated that several banks have approached the City with an interest in biodiesel as a new marketing opportunity. Member Augustine offered to survey banks that they work with to see if they are interested in offering low-cost loans for this industry and coordinate this effort with the Mayor’s Office of Economic Development.
Member Jordan stated that it takes a significant amount of work to meet with owners and make sure they understand biodiesel, its blends, and financial impact. An inquiry was made as to whether the City has a mechanism to offer a grant program to be implemented through a non-profit organization in an effort to help pay for infrastructure at gas stations and work out details for low-cost bank loans. Ms. Mackin advised that the City has limited financial resources and grant money, and suggested the possibility of looking outside of the City to search for funds. It was suggested that investors in clean technology and renewable energy be sought after for grant funding.
Chair Bowen left the meeting at 11:00 a.m.
8. INFORMATIONAL REPORT. Update on Permitting Regulations for Biodiesel (Continued from the September 21, 2006 Meeting).
SPEAKERS: Members Jordan and Dennis
Member Jordan reported that this effort involves trying to identify how to regulate biodiesel and its blends and ways to distribute pure biodiesel (B100) to the community. It was stated that blend fuels and pure biodiesel have different characteristics that need to be identified. A permitting process has to be put in place. Main points discussed include:
· Work has to be done on identifying the physical characteristics of pure biodiesel versus diesel, what storage hazards there may be for residences and businesses, and then providing appropriate regulations. The Planning Department, Department of Building Inspection, the Department of Public Health, and Fire Departments would be the agencies that are involved in the permitting and storage process. Member Jordan is working with Member Ferry from the Fire Department on identifying pure biodiesel characteristics.
· Identifying if the availability of biodiesel can be increased because of its differing physical characteristics in its pure form. Member Hagen asked if these characteristics have been identified through state and federal government, such as the Environmental Protection Agency or other state organizations. Member Jordan stated that some physical characteristics have been identified. It was indicated that the objective is to identify how pure biodiesel falls within existing regulations and determine City requirements for permitting.
· Need to understand the national, state and local regulatory criteria for biodiesel or Class 3B liquid, examples of how those are stored, classified and regulated. Agencies across the country are working on this effort, and people are looking at the San Francisco Biodiesel Access Task Force to set standards.
Member Jordan, Member Ferry and Fire Prevention staff will schedule a meeting to discuss Fire Department requirements and schedule this topic as an agenda item for the December meeting. Member Jordan indicated that he has been able to photograph pure biodiesel dispensing installations across the country and state and would like to show examples at the next meeting.
9. INFORMATION: New Business. There was no new business reported at this time.
10. DISCUSSION: Future Agenda Items. (1) Citywide fleet implementation (Mackin and Drew) (2) the role of biodiesel as an alternative fuel from the Mayor’s perspective; and (3) pure biodiesel installations and dispensing across the country and state (Jordan).
11. PUBLIC COMMENTS: Members of the public may address the Task Force on matters that are within the Task Force’s jurisdiction and are not on today’s agenda. There was no public comment at this time.
12. ADJOURNMENT. The Biodiesel Access Task Force meeting adjourned at 11:40 a.m.
Respectfully submitted by,
Monica Fish, Task Force Secretary
** Copies of explanatory documents are available at (1) the Task Force office, 11 Grove Street, San Francisco, California between the hours of 9 a.m. and 5 p.m., (2) upon request to the Task Force Secretary, at telephone number 415-355-3709 or via e-mail at Monica.Fish@sfgov.org, or (3) on the meeting website as attachments to the agendas or meeting minutes.
Adopted: November 16, 2006