CITY AND COUNTY OF SAN FRANCISCO
BIODIESEL ACCESS TASK FORCE
THURSDAY, APRIL 19, 2007, 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), Vandana Bali (Department of the Environment), Mike Ferry (Fire Department), Tom Franza (SFPUC), Laurence Kornfield (DBI), Dina Mackin (MOCD), Marty Mellera (MTA), Virginia St. Jean (DPH).
TASK FORCE SECRETARY: Monica Fish
ORDER OF BUSINESS
1. CALL TO ORDER AND ROLL CALL. The Biodiesel Access Task Force meeting was called to order at 10:08 a.m. Voting Present: Chair Bowen, Members Hardy, Jordan and Ving; Excused: Vice-Chair Hagen. Non-Voting Members Present: Members Augustine, Bali, Berman, Mackin (10:45), and St. Jean. Absent: Members Dennis, Ferry, Franza, Kornfield, and Mellera.
2. ACTION: Approval of the February 15, 2007 and March 15, 2007 Biodiesel Access Task Force Regular Meeting Draft Minutes. Upon Motion by Chair Bowen and second by Member Jordan, the February 15, 2007 Meeting Minutes were approved without objection (AYES: Chair Bowen, Members Hardy, Jordan, and Ving) (Absent: Vice-Chair Hagen) (Explanatory Document: February 15, 2007 Approved Minutes). Upon Motion by Chair Bowen and second by Member Ving, the March 15, 2007 Meeting Minutes were approved without objection. (AYES: Chair Bowen, Members Hardy, Jordan, and Ving) (Absent: Vice-Chair Hagen) (Explanatory Document: March 15, 2007 Approved Minutes).
3. INFORMATIONAL REPORT: Status Report on Recommendations to the Board of Supervisors on Incentives for Gas Stations to Sell Biodiesel (Continued discussion from the March 15, 2007 Meeting).
SPEAKERS: Member David Augustine and Chair Eric Bowen
Chair Bowen stated that at the March 15, 2007 meeting, the Task Force discussed whether to include biodiesel incentives and Health Department fee waivers as part of the proposed Clean Tech Tax Credit Ordinance or as stand alone bill(s). Chair Bowen stated that the Task Force did not want to make a proposal to Supervisor McGoldrick on this issue without first consulting with Member St. Jean on the Department of Public Health department head’s viewpoint. Member Mackin reported that in her last conversation with Supervisor McGoldrick, the discussion was that it could complicate the nature of the Clean Tech legislation if included with the goals of the biodiesel legislation. Member Mackin stated that she has submitted proposed legislation to expand the definition of Clean Tech but did not include normal gas stations that would sell biodiesel in that proposal at this time. Chair Bowen indicated that he would speak to Supervisor McGoldrick before deciding whether to pursue the biodiesel incentives as a separate ordinance.
Member St. Jean stated Health Code blanket fee waivers are problematic because the fees are site specific and there is a level of complexity that differs from potential sites. Historically, the Health Department waives fees on a case by case and fee by fee basis, and without knowing their potential candidates, program managers may be unwilling to do a blanket waiver. It was indicated that it would be more feasible to waive fees only for the biodiesel tanks at existing gas stations. Member St. Jean asked whether there may be another method of offering an incentive other than blanket waivers. Chair Bowen asked whether there has been a history of the Board of Supervisors authorizing the Health Department to do discretionary waivers. Member St. Jean stated that the HAZMAT program director as part of the Health Ordinance has the authority to waive fees on a case by case basis by petition.
Chair Bowen stated that if biodiesel stations were to be included in the Clean Tech legislation, language could be included in the Resolution to state that the Board of Supervisors encourages the Health Department to consider fee waivers by petitioners for maintenance and inspection of biodiesel tanks. Member St. Jean indicated that it would be a case by case basis and a lot would be based on compliance history.
Chair Bowen recommended that the Task Force issue a policy statement promoting fee waivers, e.g. that the greatest fee waivers we want to promote are B100 stations outside of the petroleum infrastructure and would promote fee waivers for existing gas stations installing B20 but only with regard to that portion of their business and would not encourage fee waivers for people who have a history of non-compliance. Member St. Jean stated that it may be complex at the Board of Supervisors level as each fee has to be specified and there are many fees for each station. Chair Bowen stated that the Task Force could send a policy statement to the program director that could also be attached to the Board of Supervisors Resolution saying that the Task Force would appreciate the Health Department’s consideration of businesses that are applying for fee waivers.
Chair Bowen indicated that he would work with Member Jordan to create a recommendation letter from the Task Force to the Department of Public Health to consider fee waivers when evaluating biodiesel fueling applications. Member Jordan asked whether there would be a limit to the number of stations that would be granted fee waivers per year and if the waiver would be for just one year. Member St. Jean stated that the program director had similar questions, e.g. whether the fee waivers would be granted annually and at what point would the waivers be received.
Member Augustine explained that the Tax Collector’s Office requires that businesses fill out an annual request for payroll tax exclusion form and suggested adding a field to the form regarding Health Department fee waivers. Member St. Jean stated that the Health Department would request that the applicant reapply for a fee waiver renewal as part of an annual registration or annual renewal process.
Member Jordan asked whether a fee waiver would apply to all gas stations or a particular number of stations and to what type of station ownership. Member St. Jean stated that a cap is imperative. Chair Bowen suggested recommending that the minimum threshold could be 10-12 for stations selling B20 and above and 6 for B99 and above. Member St. Jean stated that it would be easier to waive fees for B100, but indicated that the Fire Department is evaluating whether it is a hazardous material. Member Jordan suggested recommending fee waivers for 10-12 B20 tanks for one year and 6 - B100 tanks for three years.
Chair Bowen suggested asking the Fire Department about their fees and the possibility of waivers. It was recommended that the Fire Department be presented with a similar policy recommendation for discretionary fee waivers. Member Hardy advised that the East Bay Fire Department fees are less and are based on storage capacity. Member Jordan offered to research Fire Department fees and to ask whether there would be a willingness to participate in fee waivers.
Member Augustine advised that the existing legislation that is amending the Clean Tech exclusion is sponsored by Supervisor Jew and recommended a discussion with his office. Member Jordan asked if payroll tax exemptions would apply to a designated number of stations for a specific term. Member Augustine stated that every tax-exclusion has a sunset period of approximately three years and an annual report is received on its progress. Member Jordan asked which stations would be eligible. Member Augustine stated that only half of the gas stations currently are paying the payroll tax so eligibility is limited. Member Jordan asked whether it would be limited to franchise gas station owners and small businesses. Member Augustine stated that the legislation could be tailored to be only applicable to certain businesses.
Member Bali asked how all of these issues are going to be worked on outside of the meeting. Chair Bowen stated that Vice-Chair Hagen has been talking to Supervisor McGoldrick, the sponsor of the biodiesel legislation and that Member Mackin is taking charge on the Clean Tech Tax Credit. Member Bali recommended that a smaller subgroup be formed to track and move forward on efforts. Chair Bowen stated that the Task Force has been in an information gathering mode for the last several months and is close to making a determination. Member Augustine asked whether the City Attorney’s Office has been assigned to start drafting legislation. Chair Bowen indicated that Vice-Chair Hagen would be talking to Supervisor McGoldrick about assigning a Deputy City Attorney.
Chair Bowen stated that Discussion and Approval of a Recommendation Letter to the Health Department on Fee Waivers for biodiesel filling stations would be on the May 17 meeting agenda.
4. DISCUSSION and ACTION: Approval of Letter to Gas Stations on the Prospect of Selling Biodiesel to Individual Consumers (Continued discussion from the March 15, 2007 Meeting).
SPEAKER: Vice-Chair Adam Hagen
Chair Bowen reported that originally, the Independent Gas Station Owners Association had agreed to send a letter to their members on the prospect of selling biodiesel to individual consumers, but have since changed their mind. Vice-Chair Hagen was planning to work with Member Augustine to see if a publicly available mailing list of gas station owners was available in order for the Task Force to send the letter independently on Biodiesel Task Force letterhead. Member Augustine reported that the addresses were public and could make the list available. Chair Bowen stated that he would forward a copy of the revised letter for the Task Force’s review for the next meeting. This item was continued to the May 17, 2007 meeting.
5. INFORMATIONAL REPORT. Update on Permitting Regulations for Biodiesel (Continued from the March 15, 2007 Meeting).
SPEAKER: Member Benjamin Jordan
Member Jordan reported that there has been a lot of activity on meeting with the Building (DBI) and Fire Departments to talk about pre-application submittals. It was stated that applications were submitted on two projects, one at 38 Otis Street, an auto service center that will do small-scale biodiesel dispensing to their customers that come in for diesel work and the other is Rainbow Grocery at 1745 Folsom Street that has a back parking lot that can handle this type of work. It was stated that these are two of the permanent commercial dispensing facilities that would be separate from a traditional commercial public station. Member Jordan presented copies of the permits.
Member Jordan stated that there were two different scenarios being reviewed to achieve regulation permitting of oversight for alternative dispensing, e.g. one was commercial for public use and the other was a mobile fueling permit for when there are events in town such as a circus and they want to fuel trucks, etc. A copy of the mobile permit fuel application for 701 Amador Drive was presented for review. It was stated that the public dispensing station permits are with the Building Department which if approved will be an approval for implementation. A decision should be made in about a month or two. Member Jordan reported that the Fire Department has given their preliminary review to the commercial dispensing facilities and the mobile fueling.
Member Jordan stated that he is working with Mr. Laurence Kornfield, DBI, on determining what type of submittal is required for residential storage. It was stated that it would not be an actual submittal by a residence, that it would be obtaining a statement of understanding from the Department as to what people can store in their home. The remaining permit would be on Railcar Handling and Storage (LBRAILCO) to understand what it would take to be able to bring in a railcar of biodiesel into San Francisco for loading and unloading.
It was stated that a report will be produced called “Permitting Regulations Summary” that will be a roadmap for gas station owners or anybody interested in dispensing biodiesel on permitting, fee structures, and general guidelines. Member Jordan stated that an update will be given at the next meeting on May 17, 2007.
Chair Bowen stated that there has been a lot of discussion from different sectors about moving more towards 24-7 accessible B100, partly because of the success of Biofuels Oasis. The consensus would be to do what Biofuels Oasis is doing and asked what neighborhoods to target to identify a property owner that would have an already permitted fueling infrastructure for ingress egress issues. Chair Bowen suggested an area such as the South of Market that has a route for cars and trucks. Member Jordan suggested Bayview Hunters Point as it is affected by diesel emissions and is accessible with plenty of space. Member Hardy recommended not focusing on a certain geographic area as there are so few that meet the criteria. Member Jordan indicated that the issue with commercial fueling is that they had to find a willing applicant and there is an approximate $700 fee per site. Chair Bowen stated that he would look for an appropriate applicant and would help identify resources.
Public Comment: Mr. Randal von Wedel stated that in 1998, a lot of the stations that were forced to shut down actually no longer have tanks, but there are rare occasions where there is an ethanol tank left over from the early 1990’s when ethanol was promoted as an alternative fuel. Mr. von Wedel recommended a truck-friendly car lock facility in Bayview Hunters Point because the biggest impact for local air quality would be through trucks.
Member Mackin asked where Norcal was getting their biodiesel and if they would be interested in selling biodiesel. Member Bali explained that they have their own tank across from Candlestick Park. Chair Bowen stated that it is not designed for public sale.
Member St. Jean discussed concerns with residential biodiesel dispensing in a household garage. Member Jordan clarified that it would be for someone who had a fuel tank and wanted to store biodiesel for their own personal use, not for public dispensing. Member St. Jean explained that the Health Department does not have jurisdiction over residential sites, but the Fire Department would have concerns with residential storage. It was recommended that the Task Force have a separate discussion with the Fire Department to create policies and guidelines for storage. Member Berman stated that biodiesel should be developed in a way that it is used as any other fuel. Chair Bowen suggested that information should be made available to the public on proper handling procedures and safety guidelines.
6. INFORMATIONAL REPORT: Citywide Fleet Biodiesel Implementation Update (Continued discussion from the March 15, 2007 Meeting).
SPEAKER: Member Vandana Bali
Member Bali reported that the Citywide Fleet Biodiesel implementation goal was supposed to be at 25% by March 31st and is now at 39%. It was explained that 39% of the diesel vehicles and equipment in the City of San Francisco including the MUNI bus total are using B20. (There are 977 pieces of diesel vehicle and equipment and then adding on MUNI’s 503 revenue buses to total 1500--of that 1500 total, 39% are using B20.)
Member Bali stated that on March 15, Central Shops switched both their tanks to B20 and are responsible for approximately 1000 pieces of equipment and vehicles which the majority of are using B20. It was explained that this total does not include MUNI’s revenue buses, but does include about half of MUNI’s non-revenue buses.
On March 19, Norcal switched to B20 on their entire fleet of 385 refuse trucks. Drivers had indicated that there was improved performance with biodiesel. It was explained that Norcal is using the same Clear Longview emissions control device that MUNI is using on their diesel buses and MUNI is waiting to see the results from Norcal. Not a single problem has been reported thus far. Member Bali explained that the trucks all have Cummings engines and they have worked hard with Cummings to release a statement that B20 can be used with Cummings engine families and are working with Clear to issue the same statement. The next step is to continue to work with MUNI who has shown an interest in moving forward with a pilot. The next meeting with MUNI will be to discuss the MUNI revenue bus pilot. MUNI has identified tanks and buses and wants to meet the end of 2007 target date for fleet conversion.
Member Bali reported that the Fire Department representative that was managing the program is on extended leave, so Member Ferry is putting together the tank monitoring program. It was stated that a software demonstration will be complete by the end of May and a determination will be made whether they will be moving forward with the software. It was stated that the Fire Department will start putting in B20 on about 22 ambulances starting in May and will start the Phase 2 pilot.
Member Bali reported that the Public Utilities Commission (PUC) has found through their B20 pilot in one of their four facilities that they needed a new fuel storage tank that they will have to budget for. PUC’s other pilots will start in May.
Public Comment: Unidentified speaker from the PUC Wastewater Unit stated that the PUC Wastewater Unit fuels their fleet at Central Shops and that all of the big sewer trucks are all using B20.
Member Bali stated that she is interested in replicating the Norcal model in the private sector and indicated that there is a 20% reduction in emissions as a result of Norcal’s conversion to B20.
7. INFORMATIONAL REPORT: Status of the Joint Biodiesel Press Event (Continued discussion from the March 15, 2007 Meeting).
SPEAKER: Member Vandana Bali
Chair Bowen explained that the Biodiesel Press Event is no longer a joint event. Member Mackin reported that the press event is scheduled on April 24 at noon, and the Task Force is welcome to participate. Norcal will have trucks there as well as city vehicles. The Mayor will be sitting in a biodiesel vehicle and filling up a tank with biodiesel. Member Bali recommended a mini-sweeper as they are all running on biodiesel. The Environmental Protection Agency will be in attendance. Member Mackin indicated that a press release will be issued.
Public Comment: Mr. von Wedel confirmed with Member Mackin that invitations could be issued to interested groups. Member Mackin stated that she would be the point person for the press event.
8. DISCUSSION: Informational Report to the Board of Supervisors setting forth its recommendations as well as criteria for evaluating the success of the Task Force's proposals as required by Board of Supervisors Resolution 82-06 (Continued discussion from the March 15, 2007 Meeting).
Chair Bowen reported that the Informational Report would be delivered to the Board of Supervisors when the Task Force sunsets at the end of this year or to the date it may be extended to. Member Jordan distributed a draft outline of the Task Force’s work to date (Explanatory Document: Biodiesel Task Force Outline). Member Jordan stated that revisions would be made and a final outline would be finalized in a month or two at which time the actual writing and production of components would be delegated to specific members. Members were asked to forward their comments to Member Jordan.
9. DISCUSSION: Status Report on the Commendation Letter to the Red and White Fleet for their use of Biodiesel B20.
SPEAKERS: Members Karri Ving and Dina Mackin
Member Mackin reported that the commendation letter had been mailed to the Red and White Fleet. Chair Bowen requested a copy of the letter so that it could be posted on the website.
10. INFORMATIONAL REPORT: Status Update on Building a Biodiesel Manufacturing Facility in San Francisco (Continued discussion from the March 15, 2007 Meeting).
SPEAKER: Member Dina Mackin
Member Mackin reported that she has been meeting with Member Berman and Mr., von Wedel to gather information for a draft Request for Proposal. Mr. von Wedel and Member Mackin attended a meeting with a commodities broker that described the flow of waste grease and oil through the California region that explains where the feedstock is to support the biodiesel manufacturing facility. Member Mackin explained that the sheer quantity of actual oils passing through the Port of San Francisco is so high that it wouldn’t be an issue of whether the waste, grease and oil would be from our own collection program or Darling’s oil because there is an option of multiple different sources of vendors to purchase the waste grease from.
It was explained that there would be several factors involved in the success of the manufacturing facility. Financial challenges and neighborhood approval of the facility would be key elements for its success. Another key element is whether the facility would provide a business opportunity that is commercially viable on its own because of the high cost of land in San Francisco and the City not being able to subsidize the venture. In addition, because of the varying values of the different kinds of sources you can sell these kinds of oils to and the markets they go into, whether it will be cost effective for the brokers of the waste, grease and oil to sell it to the biodiesel manufacturing plant. It was stated that much of this oil is getting exported to the Far East, and that the price of selling it to the Far East is higher than it is to sell it to a local production facility at this time. Member Mackin indicated that brokers are more interested in getting the best price than in environmental factors so would be willing to transport large cargo level oils across the country if they could get a better price than in California. A positive factor would be that San Francisco would be added as a critical location in the industry of hauling waste, grease, and oil through the Port and to the Far East and would then be considered a good location for trade.
Public Comment: Mr. Randal von Wedel stated that the economics are the difficult part and the necessity for other viable options for contracts for feedstock if the City could not subsidize the land. It was stated that in addition to the railcars, product could be transported by barge rather than by fueling trucks across the Bay Bridge.
Member Jordan asked if there is a timeline of where this process will go in the next couple of years. Member Mackin said that the proposal will be presented at a Port community workshop on June 9. There will be a discussion and presentation of the proposal and a Draft RFP will be ready for the Commission and other relevant participants to consider.
It was explained that a list of different opportunities that the City has proposed to the Port in order to review the potential uses of Port lands will be considered.
Public Comment: Mr. Michael Gersick asked what the City would be bringing to the party if no financial incentives were being considered and it would have to be a self standing economically viable private investment. Member Mackin explained that the land is state owned which is a key location at the Port for a biodiesel manufacturing facility. It was stated that because it is Port land, which means it is Public Trust, it must have a marine requirement and the Port has many things to consider for redevelopment uses of the Port. This would be a lease opportunity that is being chosen among many.
Mr. Gersick asked why a developer would invest in San Francisco where cost of land is high rather than choose to invest elsewhere. Member Berman stated that the Port has a duty to be prudent in how it manages its resources and the goal is to achieve market value in its lease terms. However, as the RFP is being worked on, opportunities for incentives may be discovered. Member Berman stated that the marine component is not mandatory, but it is encouraged and there are opportunities for leases that are more easily facilitated if they have a marine component.
Member Mackin stated that an advantage to locating in San Francisco would be that the City fleet would be a guaranteed sales source. It was explained that the most important benefit is that Darling owns the site and transfers all of the oil through this Port site which makes this a strategically important location in the Northern California market because of the high cost of trucking fuel adding to biodiesel production cost. By having it already on site coming through by train and going directly onto the barge, you have cut a huge cost. Member Mackin stated that another benefit to locating a biodiesel facility in San Francisco is the public attention surrounding events in San Francisco.
11. INFORMATION: TASK FORCE SECRETARY REPORT: Correspondence on City Parking Policies for attendance at Task Force Meetings (Explanatory Documents: Task Force Secretary Report to Biodiesel Access Task Force Members: Free Parking Policy Recommendations; Mayor’s Office Letter to the Municipal Transportation Agency on Parking Reforms).
Task Force Secretary Monica Fish was not present at this meeting. Chair Bowen reported that the City is considering removing its policy for paying for parking for Task Force members at Task Force meetings and is encouraging public transportation instead.
12. INFORMATION and DISCUSSION: New Business/Future Agenda Items.
Ms. Anne Eng, Department of the Environment Environmental Justice Program Manager stated that at last month’s meeting an inquiry was made about school buses. Ms. Eng discussed communication received on work done by Parents Voices, an advocacy group, and the American Lung Association. It was explained that Laidlaw has newer diesel engines in their school buses and their renewal contract with the School District included a provision persuading them to put in retrofits or other particulate matter reduction measures. It was stated that given what is going on with Norcal with its new engines, there is still an opportunity for B20 usage even in newer school bus apparatus which could be pursued.
Member Jordan asked that this item be placed on a future agenda in order to develop a letter from the Task Force or to keep the spotlight on the school buses. Member Bali stated that the Task Force should review where the $200 million dollars from the Air Board would go that was set aside in the November election for clean school bus programs throughout the state. Member Bali stated that the first plan of action should be to do needs-assessment of where we are in San Francisco with Laidlaw and volunteered for this effort.
Public Comment: Mr. von Wedel stated that there was an effort in January 2005 with Laidlaw that did not go anywhere, but that was before incentives were established. It was stated that there is plenty of written documentation now that shows the impact of particulate matter emissions. Member Bali stated that there is scientific data that shows the air inside the school bus is much dirtier than if you were behind it.
Ms. Eng stated that at the March Biodiesel Task Force meeting during the discussion of the EPA grant to City College and its partners, there was a request to establish a point person to help field or refer questions to the appropriate technical consultant. Ms. Eng advised that a point person is being established and she would like to coordinate with this group in order to provide public education about biodiesel to help generate an open market. Member Jordan stated that the City should have a location for biodiesel technical assistance that private and commercial entities could reference. It was stated that the EPA would generate some of the funding for this effort. Member Jordan explained that City College is a great option because they have a lot of biodiesel programs, do quarterly biodiesel 101’s, hold alternative fuel classes, and are doing Bayview Hunters Point neighborhood training programs for job placement in the alternative fuel industry. It was stated that the Department of the Environment also would be a great location for information.
Member Mackin stated that she has been approached by a company, Propel, who is in the market for developing biofuel dispensers, and they are approaching gas stations individually to offer a partnership. Chair Bowen stated that Propel had given a presentation to the Task Force at a previous meeting.
13. 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.
Ms. Robin Gold introduced herself and Ms. Michelle Swiggers who are interested in opening a biodiesel fueling station and are looking for a viable location in San Francisco to serve public retail, passenger vehicles, small fleets and big trucks. Ms. Swiggers asked the Task Force for assistance in locating a viable location.
14. ADJOURNMENT. The Biodiesel Access Task Force meeting adjourned at 11:45 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.
Approved: May 17, 2007