This report recommends that the City Manager be authorized to execute a contract with North American Bus Industries, Inc. (NABI), to furnish and deliver 37 new 40-foot, low-floor, lightweight, liquid natural gas powered buses, with miscellaneous spare parts in the amount of $13,071,453. The bid also includes two options, one for 12 and one for 10 replacement buses, in the amount of $7,750,758. One or both of these options may be exercised in future fiscal years at the City=s discretion. The maximum amount of the contract would be $20,822,211 if the City exercises both option orders.

The Transportation Department maintains a capital improvement program to replace aging buses on an ongoing basis and to provide for necessary additional equipment to meet service expansion needs. Under its replacement program, the Department replaces buses after they reach 12 years of age. Experience indicates that buses that exceed this age are more costly to maintain and suffer from major body corrosion due to the City=s proximity to the ocean. Fifteen buses are scheduled for replacement in Fiscal Year 1999-2000. A review of the condition of the current fleet indicates that replacement of these 15 vehicles should not be delayed. Additionally, 12 replacement buses are programmed in FY 2000-2001 and 10 replacement buses are programmed for FY 2001-2002.

The specifications for the buses called for liquified natural gas (LNG) engines, in keeping with the City=s policy to purchase alternatively fueled vehicles. In order for the Transportation Department to procure and operate LNG buses, extensive facility modifications are required. These modifications were discussed in the Big Blue Bus Alternative Fuels Implementation Plan, presented as an information item to the City Council in September 1996 and further refined in the Transportation Department=s Draft Facility Expansion Master Plan, approved in concept by City Council in January 1999. The design of a new fuel island and bus washer is currently underway and includes an LNG station for the transit buses and compressed natural gas (CNG) for service vehicles. The fueling facility is scheduled to be completed by January 2001, which coincides with the delivery of this order of buses.

North American Bus Industries, Inc. (NABI), the apparent low bidder, has proposed their ACompoBus,@ which is a composite bus utilizing a new patented technology called ASCRIMP@ (Seeman Composite Resin Infusion Molding Process). This technology provides substantially superior tensile and impact properties, and unusually high strength-to-weight relationship. The key benefits are that the bus weight will be about 7,000 pounds less than our current buses, resulting in improved fuel economy and extended brake and tire life. In addition, the bus exterior will be impervious to corrosion and the LNG engine will result in reduced emissions. The bid also includes bike racks, security cameras and voice/visual stop announcement systems.

City staff recommends that the City Council authorize the City Manager to execute a contract with North American Bus Industries, Inc., for the purchase of 37 new forty-foot, low-floor, lightweight, LNG powered transit buses with miscellaneous spare parts and two additional options for 22 buses in future fiscal years, and appropriate $4,965,453 into account C41051999.589000 from Transportation capital reserve funds.