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Suggested Citation:"Chapter Six - Case Examples." National Academies of Sciences, Engineering, and Medicine. 2011. Strategies and Financing Opportunities for Airport Environmental Programs. Washington, DC: The National Academies Press. doi: 10.17226/14567.
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Suggested Citation:"Chapter Six - Case Examples." National Academies of Sciences, Engineering, and Medicine. 2011. Strategies and Financing Opportunities for Airport Environmental Programs. Washington, DC: The National Academies Press. doi: 10.17226/14567.
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Suggested Citation:"Chapter Six - Case Examples." National Academies of Sciences, Engineering, and Medicine. 2011. Strategies and Financing Opportunities for Airport Environmental Programs. Washington, DC: The National Academies Press. doi: 10.17226/14567.
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Suggested Citation:"Chapter Six - Case Examples." National Academies of Sciences, Engineering, and Medicine. 2011. Strategies and Financing Opportunities for Airport Environmental Programs. Washington, DC: The National Academies Press. doi: 10.17226/14567.
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Suggested Citation:"Chapter Six - Case Examples." National Academies of Sciences, Engineering, and Medicine. 2011. Strategies and Financing Opportunities for Airport Environmental Programs. Washington, DC: The National Academies Press. doi: 10.17226/14567.
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206 This chapter presents 11 case examples of airport experiences in pursuing alternative funding for environmental initiatives. Funding sources include VALE, DERA, Clean Cities, state programs, and partnering with the private sector. Information is based on interviews and background information pro- vided by interviewees. Specific source information for the case examples is included in the References. PORT COLUMBUS INTERNATIONAL AIRPORT— LEVERAGING MULTIPLE FUNDING SOURCES TO REDUCE VEHICLE EMISSIONS The Columbus Regional Airport Authority (CRAA) success- fully obtained funding to convert a portion of its shuttle fleet at Port Columbus International Airport (CMH) to AFVs and to reduce diesel emissions through retrofitting and installa- tion of auxiliary power units. CRAA’s experience provides an example of combining multiple funding sources to maxi- mize outside funding and an example of working though nonprofit advocacy groups and coalitions. CMH is a medium hub airport. Working with Clean Fuels Ohio, CRAA obtained a portion of an $11 million grant to finance the acquisition of propane shuttle buses to replace a portion of its conventional engine parking shuttle bus fleet. Clean Fuels Ohio is a statewide non- profit organization based at Ohio State University and ded- icated to promoting the use of cleaner, domestic fuels and efficient vehicles to the transportation industry, government, and the general public. Clean Fuels Ohio is designated as a Clean Cities Coalition by the DOE. Previously, CRAA had relied on retrofits to reduce vehicle emissions; however, the retrofit process was proving to be unsatisfactory. The coalition had made the decision to rely on propane bus purchases rather than retrofitting. CRAA is a member of the coalition and is aware of the coalition’s programs and initiatives. In this case, Clean Fuels Ohio approached CRAA about helping to fund the bus purchases. (More recently, Clean Fuels Ohio approached CRAA about participating in a project to obtain funding for electric vehicle recharging stations.) By combining projects from CMH, the city of Columbus, and local taxicab companies, Clean Fuels Ohio obtained an $11 million Clean Cities Grant from the DOE. CRAA applied the grant funds it received through Clean Cities Ohio to the incremental costs of the propane fuel system. The resulting cost savings permitted CRAA to increase the number of buses purchased from four or five (the number usually purchased under normal replacement cycles) to eight. Absent the partnership with Clean Fuels Ohio, CRAA would not have qualified for the Clean Cities funding; only Clean Cities Coalitions are eligible to apply. In addition, as the grantee Clean Fuels Ohio assumed much of the burden of complying with administrative and reporting requirements for the grants. CRAA had considered purchasing CNG vehicles instead of propane. However, the volume of fuel consumed by the parking shuttle fleet would not have been sufficient to sup- port a CNG refueling station. Previously, CRAA had partnered with the Ohio Envi- ronmental Council and three Ohio municipalities to obtain grant funding from the Midwest Clean Diesel Initiative. CRAA’s project involved retrofitting nine vehicles with particulate filters and four vehicles with diesel oxidation catalysts. Three more vehicles were funded for installation of auxiliary power units. CRAA is funding a third initiative without any outside fund- ing sources. To reduce vehicle fuel consumption during warm weather months, CRAA leases and operates golf carts instead of gasoline-powered pickup trucks to provide on-airport trans- portation. The fuel cost savings pay for the cost of the leases. COLUMBUS REGIONAL AIRPORT AUTHORITY— SUCCESSFUL PUBLIC–PRIVATE PARTNERSHIP FOR BROWNFIELD REDEVELOPMENT CRAA’s participation in a brownfield redevelopment proj- ect demonstrates the ability of public–private partnerships to obtain financial assistance for brownfield projects, even though this project did not involve an on-airport site. A business had identified a brownfield site for redevelopment into an office building, and the cleanup project had been determined to be highly ranked for funding under the Clean Ohio Revitalization Fund program (CORF). All that was required was to identify an eligible public agency to serve as project applicant. CRAA was eligible and agreed to apply for the grant. As the applicant, CRAA received the grant funds after the award of the grant. CRAA was responsible for meeting CORF accounting and CHAPTER SIX CASE EXAMPLES

207 record-keeping requirements for the grant and providing infor- mation on the project to CORF. CRAA’s experience could provide a model for on-airport brownfield cleanup so long as the airport applying for the grant is not responsible for the contamination. OAKLAND INTERNATIONAL AIRPORT AND CALSTART—SUCCESSFUL PARTNERING FOR DIESEL EMISSION REDUCTION ACT FUNDING The Port of Oakland, operator of Oakland International Airport (OAK), successfully teamed with CALSTART and two other California airports, San Francisco International Airport and San Diego International Airport, to obtain funding to retrofit OAK diesel vehicles with particulate filters and to acquire new CNG vehicles to reduce diesel emissions (see Figure 3). A fourth air- port, Los Angeles International Airport (LAX), was part of the original consortium of airports, but it is no longer participating in the program and did not take any funds. Some of the funds designated for LAX have been provided directly to carriers serving LAX. All four of the original airports had been active in CALSTART prior to the DERA initiative. CALSTART origi- nally assisted the airports informally in their preparation of the applications. When it became evident that the airports individ- ually could not generate a sufficient number of projects to meet the minimum grant requirement, the concept of CALSTART serving as the applicant was discussed. CALSTART is eligible to apply for DERA funding as a nonprofit focused on trans- portation. CALSTART conducted a one-day outreach session about the program for airports and stakeholders. As the applicant and grantee, CALSTART is responsible for all financial aspects of the grant and the project, including sub- mitting reports to EPA and processing payment requests. As a sub-recipient, OAK is responsible for executing a sub-recipient agreement, paying the vendor and invoicing CALSTART. FIGURE 3 Oakland International Airport retrofit bus. FIGURE 4 Port of Oakland CNG vehicle. FIGURE 5 Oakland International Airport CNG fueling station. PORT OF OAKLAND—PUBLIC AND PRIVATE FUNDING FOR ALTERNATIVE FUEL VEHICLES The Port of Oakland has a continuing program to acquire AFVs for Port operations including operations at OAK. From 2001 through 2005, OAK received a total of $474,000 in grants for the acquisition of CNG vehicles, one electric vehicle, and public electric vehicle recharging stations (see Figure 4). Fund- ing came from the Bay Area Air Quality Management Dis- trict (BAAQMD) and the State Energy Program. OAK also received grants directly from Ford Motor Company for CNG vehicles and CNG fueling stations (see Figure 5). PORT OF OAKLAND—HELPING COMMERCIAL VEHICLE OPERATORS COMPLY WITH ALTERNATIVE FUEL VEHICLE FLEET REQUIREMENTS To address air quality issues in Oakland and the Bay area, the Port of Oakland adopted mandatory targets for the percent- age of an operator’s fleet operating at OAK. The original

208 minimum standard was 50% of the fleet. The original standard specified CNG vehicles. To overcome resistance to the mandate, the Port began to provide incentives. One form of incentive was cash assistance for the purchase of CNG vehicles. For taxi operators, the Port provided an allowance of $3,000 per vehicle. For other vehi- cles, the allowance was larger. A second incentive directed to taxi operators was provided in the form of improved access to the airport. The Port’s standard operating policies restrict an individual taxi to picking up passengers every other day. This policy was waived for CNG vehicles, enabling daily operations at the airport. The vehicle allowance was funded with grants from the BAAQMD and the State Energy Program. From 2002 through 2006, the Port received a total of $312,000 to finance the cash incentive program. The Port applied for the grants on behalf of the operators and disbursed the grant funds once received. With the elimination of factory original manufactured CNG passenger vehicles suitable for taxis, the Port of Oakland has temporarily reduced the fleet percentage requirement to 25% and allows taxi operators to use hybrid electric vehicles to meet the requirement. The Port has not offered cash assistance since 2006 because the administrative burden became too great. Instead, the sub- sidies are provided directly by Clean Energy, which owns and operates a CNG refueling station on airport property. DALLAS/FORT WORTH INTERNATIONAL AIRPORT—A SUCCESSFUL PUBLIC–PRIVATE PARTNERSHIP FOR ALTERNATIVE FUEL VEHICLE REFUELING The Dallas/Fort Worth International Airport (DFW) took a dif- ferent approach to financing the construction of a CNG refuel- ing station for its airport. DFW issued an RFP for a commercial operator to build and operate the station. The RFP required proposers to offer a standard index rate plus a fixed markup for sales to DFW. The station was needed to service DFW’s fleet of CNG vehicles, but the RFP permitted sales to the general public as well. The winning operator, Clean Energy, Inc., funded 100% of the construction costs of the station and agreed to a fixed markup on the sale of CNG to the airport. (CNG’s fixed rate offer was determined to be most advantageous to the airport.) The general public pays the prevailing unit rate for CNG. Clean Energy recoups its cost and generates its profit from the fixed markup and retail sales to the public. Clean Energy owns the refueling station. Therefore, the station was ineligible for VALE and other federal grant pro- grams. Even without government assistance, however, DFW gets the benefit of a refueling station on-airport at no out-of- pocket cost and reduced rates on the purchase of CNG. Clean Energy, in turn, gets the benefit of sales to the airport and the general public through its investment in the station. JOHN F. KENNEDY INTERNATIONAL AIRPORT— A PUBLIC–PRIVATE PARTNERSHIP FOR HYDROGEN FUELED VEHICLES John F. Kennedy International Airport (JFK) is one of four commercial service airports operated by the Port Authority of New York and New Jersey (PANYNJ). JFK’s hydrogen pro- gram is a partnership among the PANYNJ, the DOE, General Motors (GM), and Shell Oil Company. The PANYNJ was originally approached by GM with an offer of hydrogen vehi- cles through its Project Driveway program. The vehicles were initially provided for three months at no cost. Later, Shell offered to construct a hydrogen fueling station. The DOE sup- ported the program with a grant. The PANYNJ provided Shell with land for the station at a reduced rent. Shell constructed the station and operates and maintains it. Shell provides the hydrogen fuel at no cost. The project supports research into hydrogen fuel cell tech- nology. For example, Toyota provided JFK with 10 hydrogen fuel cell hybrid vehicles. The project also supports market test- ing of hydrogen vehicles by the public (see Figures 6 and 7). Two pictures of the fueling station appear here. NEWARK LIBERTY INTERNATIONAL AIRPORT— PUBLIC UTILITY SUPPORT FOR ENERGY EFFICIENCY Newark Liberty International Airport (EWR) is another com- mercial service airport operated by the PANYNJ. EWR took advantage of a program offered by the Public Service Gas and Electric Company (PSE&G) to reduce energy consump- tion at little cost to the airport. EWR relied on PSE&G’s Direct Install Program to install three chillers with variable speed drives and to replace lighting with more efficient fix- tures. PSE&G performed the installation and paid for 100% of the equipment and installation costs. EWR is obligated to pay back only 20% of these costs through the airport’s regu- lar utility bill. Thus, PSE&G is paying for 80% of the cost of FIGURE 6 JFK hydrogen fueling station (detail).

209 the energy saving equipment. For the EWR project, PSE&G is paying $4.8 million of the $6 million project cost, with EWR paying the remaining $1.2 million. PSE&G also per- formed a free energy audit as part of the program. PANYNJ staff estimate that the airport is saving $600,000 in energy costs annually. These savings translate into a payback period of two years for EWR’s investment in the project. BOSTON LOGAN INTERNATIONAL AIRPORT— VARIOUS FUNDING SOURCES The Massachusetts Port Authority (Massport) owns and oper- ates Boston Logan Airport (BOS), a large hub airport, as well as two smaller public-use airports. Massport has a history of utilizing outside funding and collaborating with others to accomplish environmental goals at these facilities. Notably, in 1995, Massport partnered with the gas utility company and a private developer to successfully acquire and leverage Con- gestion Mitigation and Air Quality (CMAQ) funds to con- struct at Logan Airport what remains the largest full public access CNG station in New England. In a coordinated effort, Massport converted its shuttle bus fleet to CNG. Having exceeded 14 million “clean” miles, the CNG bus fleet will soon be replaced. Massport recently received a grant under FAA’s VALE program to support acquisition of 50 new alternative fuel buses, 18 of which will be CNG-fueled, with the remaining 32 buses hybrid diesel. The VALE grant of $5.9 mil- lion will cover 75% of the incremental cost of the alternative fuel technology. The balance of the costs will be covered by Massport funds and fees collected to support a new con- solidated rental car facility, as 15 of the buses will serve that facility. Massport’s application was the first VALE project for FAA’s New England Region. Massport staff advised that the use of a consultant with experience in the FAA’s emissions modeling system and VALE applications was helpful. The process of securing a letter of commitment on emissions cred- its from the state environmental regulatory agency—a critical VALE requirement—was one of the easier parts of the process. Smaller scale examples of using outside funding for alternative fuel infrastructure include: (1) acquiring DOE State Energy Plan funds to leverage the installation of an E85 ethanol tank and the necessary infrastructure at a gas station at BOS (approximately $175,000), and (2) working with the Massachusetts Executive Office of Energy and Environmental Affairs, which has funds obtained from a Midwest power plant found guilty of polluting. If success- ful, these funds will be used to advance the installation of electric vehicle charging stations in public parking facilities at BOS. Terminal A at BOS, the world’s first U.S. Green Build- ing Council Leadership in Energy and Environmental Design (LEED) certified airport terminal, was built by Delta Airlines and turned over to Massport. Under a model that is becoming used less frequently at airports, Massport issued bonds for this work and the airline pays the debt. Massport was able to require LEED certification as a con- dition of funding. In another collaborative arrangement with Delta, Massport loaned the airline the funds required to convert its ground service equipment at BOS to alterna- tive fuel equipment. This arrangement was a “win/win” in that the interest rate of the loan both exceeded the rate of return that Massport was getting in its investments and was less than the interest rate that Delta could obtain elsewhere. A final example of collaboration on the greening of Ter- minal A involved the Massachusetts Department of Energy Resources, a private vendor, and Massport. These entities leveraged federal American Recovery and Reinvestment Act funds and federal investment tax credits to install a 376 kW solar photovoltaic (PV) system on the terminal roof. The private entity, which benefitted from the tax credits, paid for the cost of installing the solar equipment. Massport agreed to purchase the electricity produced at a discounted rate. SEATTLE–TACOMA INTERNATIONAL AIRPORT— ALTERNATIVE FUEL VEHICLES FOR AIR CARRIER OPERATIONS Seattle–Tacoma International Airport (SEA), a large hub air- port, has obtained funding through the local Clean Cities Coali- tion to finance the acquisition of alternative fuel vehicles to support air carrier operations. Funding is derived from the American Recovery and Reinvestment Act and other DOE funds. SEA’s program is focused on vehicle electrification. Original plans contemplated using federal funds to assist in the purchase of rolling stock (tugs, push-back engines, etc.) and recharging stations. Currently, all of the funds are dedicated to the purchase of rolling stock. The decision to focus on rolling stock was made to generate greater support from the carriers. FIGURE 7 JFK hydrogen fueling station.

210 SEA had initially been pursuing vehicle electrification grants directly from the DOE. SEA recognized that without federal funds carriers would not support the program. SEA was approached by the local Clean Cities coalition to join in an application with other entities. The coalition staff believed that including an airport in the partnership would distinguish their application from others and that the ability to show car- rier support would also improve the rating of the project. The coalition was able to use some of the work SEA had already done while pursuing an individual grant. SEA is functioning as the recipient of funds from the coali- tion, and treating the program as a pass-through of the grant funds to the carriers. The precise details of equipment owner- ship and contractual relationships are still under review to preserve grant eligibility. SEA staff considered VALE funding but did not think it was a good fit for purchasing rolling stock. Under the Clean Cities program, carriers can continue to use their old equipment. SEA staff believes that under VALE, the equipment would have to be destroyed or disabled. How- ever, according to FAA’s VALE program manager, FAA requires a commitment that old equipment will not continue to be used at the airport or in other nonattainment or main- tenance areas, but that the equipment need not be destroyed or disabled. PHILADELPHIA INTERNATIONAL AIRPORT— USING MULTIPLE FUNDING SOURCES TO REDUCE VEHICLE AND AIRCRAFT EMISSIONS Philadelphia International Airport (PHL), a large hub airport, is pursuing various projects to reduce emissions from on- road vehicles, the airline’s ground service vehicles, and air- craft. The projects entailed the following: • Acquire three Ford Escape hybrid electric vehicles for airport use. • Acquire eight new higher efficiency diesel buses to replace older diesel buses. • Acquire and install 45 recharging units to support 218 new electric ground service equipment units. • Acquire and install 35 pre-conditioned air units at aircraft gates. • Acquire and install 11 electric ground power units at a maintenance hangar. PHL used a combination of three funding sources to finance the projects. FAA VALE grants provided 75% of eligible proj- ect costs of approximately $14.3 million. PHL received approx- imately $1.9 million in Pennsylvania Alternative Fuel Incentive Grants (AFIG), which it applied to a portion of the 25% local match requirement for the VALE grants. Finally, PHL received a DERA grant of approximately $476,000 to cover 100% of the incremental costs of low-emissions technology for a portion of the vehicles and equipment. PHL became aware of the funding opportunities through a combination of direct announcement from the funding sources and participation in meetings of the Philadelphia Diesel Difference organization (http://www.cleanair.org/ dieseldifference). PHL applied to each funding source directly. The most recent AFIG applications were submitted electronically. Submitted project costs in PHL’s applications were based on vendor quotes or construction bids.

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TRB’s Airport Cooperative Research Program (ACRP) Synthesis 24: Strategies and Financing Opportunities for Airport Environmental Programs summarizes public and private funding opportunities and strategies available to airports to help accomplish their environmental programs and objectives.

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