United States: $5.5 Million In Recovery Act Funding Available For Ethanol Blends Infrastructure And Outreach

The Reed Smith Public Policy & Infrastructure Practice, and the Energy Practice, continue to monitor discussions and developments concerning implementation of the "American Recovery and Reinvestment Act of 2009," Public Law 111-5, ("ARRA"). The most recent development is the announcement from the Department of Energy ("DOE") of $5.5 million in grant funding for projects that increase the availability and use of potential gasoline/ethanol blends of up to 85 percent ethanol (DE-FOA-0000125). This client Alert describes the funding available, examples of acceptable projects and average grant awards; eligible applicants; cost share; information needed to be included in an application; merit review criteria; and deadlines for submission of applications and dates for awarding of grants.

Since the passage of ARRA, the Public Policy & Infrastructure Practice has worked with a number of Reed Smith clients in crafting competitive applications for grant funding, and complementary strategies to achieve funding, including obtaining the support and assistance from Members of Congress. We remain available to help complete a competitive application for funds under this program.

Funding, examples of acceptable projects, and average grant awards

According to the announcement, $5.5 million in funding is available for projects that fall in either of two "Topic Areas." Topic Area 1 covers projects that "expand the refueling infrastructure for gasoline/ethanol blends up to 85% (E85)." Acceptable projects include "upgrades to existing dispensing infrastructure; addition of new dispensing infrastructure; modifications or replacement of underground storage tanks; or addition of increased storage capacity for ethanol or ethanol blends at the retail station." The announcement further notes that "proposed projects must result in minimum of an additional five dispensers/pumps capable of dispensing ethanol blends up to E85."

Topic Area 2 covers projects that "inform the public on the benefits, safety, and use requirements of higher ethanol blends up to E85." The announcement further notes that "projects that exhibit the potential for future growth, without additional Federal funding, are encouraged," as are "[p]rojects that include materials as part of the dispenser display showing fuel energy content, mileage impact, costs per mile and greenhouse gas reductions."

Of the $5.5 million in available funding, $3.5 million will go for projects that fall in Topic Area 1, and $2 million will go for projects that fall in Topic Area 2. The DOE anticipates that for Topic Area 1, the awards will average from $50,000 to $200,000 per project.

Eligible applicants

The announcements list the following domestic entities as eligible to apply: "1) institutions of higher education; 2) nonprofit and for-profit private entities; 3) state and local governments; and 4) consortia of entities (1) through (3)." It further states, "[a]ll types of domestic entities, including DOE/National Security Agency National Laboratory Contractors, are eligible to apply, except other Federal agencies, non-DOE Federally Funded Research and Development Center (FFRDC) Contractors, and non profit organizations described in Section 501(c)(4) of the Internal Revenue Code of 1986 that engaged in lobbying activities after December 31, 1995."

Cost Share

In general, Topic Area 1 cost share must be at least 50 percent of the total allowable costs of the project. However, the cost share under Topic Area 1 is reduced for "demonstration and commercial applications," reflecting the emphasis on these projects in ARRA. For private industry applicants, the non-federal cost share for those projects can go as low as 25 percent of total allowable costs. For academic institutions, nonprofit organizations, Indian Tribes or Tribal Energy Resource Development Groups, and state and local governments, the non-federal cost share can go as low as 10 percent.

There is no cost share for projects falling under Topic Area 2, but it is "encouraged."

Information needed to be included in an application

The announcement indicates that a letter of intent and pre-application are not required. However, the following items are required to be included in an application in order for it to be considered complete:

  • Form SF 424, Application for Federal Assistance
  • Project/Performance Site Locations, including all locations where work will be performed, as well as the congressional district
  • Project Summary/Abstract, no more than one page to include: project objectives; description, benefits and outcomes; and major participants
  • Project Narrative File, a longer document to include the items mentioned above, as well as: a discussion of merit review criterion; project timetable; facilities and other resources; and equipment, as well as a discussion of how "the project will promote and enhance the objectives of the Recovery Act, especially job creation and/or preservation, and economic recovery, in an expeditious manner"
  • Resume File for each key person associated with the project, including: education and training, professional experience; publications; synergistic activities (i.e., those related to the effort proposed)
  • Budget File for the project
  • Budget Justification for costs associated with the project
  • Davis-Bacon prevailing wage requirements: information that indicates that all "laborers and mechanics funded directly by or assisted" by the funds sought will be paid "wages at rates not less than those prevailing of a character similar in the locality"
  • Letters of Commitment from each third party contributing to the cost of the project
  • Sub-award budget information that provides "information for each sub-awardee that is expected to perform work estimated to be more than $100,000 or 50 percent of the total work effort"
  • Project schedule

Review Criteria

For Topic Area 1, the projects will be evaluated along the following percentages:

  • Roles, Responsibilities, and Capabilities. Weight: 40 percent. Includes "adequacy of resources to accomplish the proposed project" and "applicability and adequacy of the qualifications and experience of key personnel"
  • Implementation Plan. Weight: 40 percent. Includes "soundness of proposed project schedule including appropriate sequencing of tasks, description of milestones, and appropriate deliverables"
  • Project Description. Weight: 20 percent. Includes "extent to which the project supports the reduction of petroleum used for transportation" and "extent of domestic jobs created or preserved in support of this project"

For Topic Area 2, the projects will be evaluated along the following percentages:

  • Probability of Project Success Based on Team Expertise and Prior Experience. Weight: 40 percent. Includes "demonstrated ability of applicants to successfully accomplish the objectives of the proposed project," and "qualifications, expertise, and experience of identified key personnel in areas relevant to the proposed work"
  • Project Success Based on Project Management Plan/Statement of Project Objectives. Weight: 40 percent. Includes "clarity, completeness, and adequacy of the detailed description of the work to be performed," and "adequacy and appropriateness of the schedule including the duration and sequencing of tasks and the scheduling of project milestones"
  • Project Reach/Potential & Concept. Weight 20 percent. Includes "reasonableness of the cost effectiveness of the project" and "the extent to which the project demonstrates that it will effectively reach a significant number of target audiences and/or stakeholders"

Deadlines for submission of applications

Applications are due by Sept. 30, 2009. The DOE anticipates notifying applicants selected for award by December 2009, and making all awards by the end of September 2010.

This article is presented for informational purposes only and is not intended to constitute legal advice.

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