UPDATED_DERA National Program NOFO FY22-FY23_FINAL.pdf

AGENCY: ENVIRONMENTAL PROTECTION AGENCY (EPA)

TITLE: 2022-2023 Diesel Emissions Reduction Act (DERA) National Grants

ANNOUNCEMENT TYPE: Notice of Funding Opportunity

FUNDING OPPORTUNITY NUMBER: EPA-OAR-OTAQ-23-03

ASSISTANCE LISTING NUMBER: 66.039

IMPORTANT DATES

Wednesday, August 2nd, 2023 Notice of Funding Opportunity (NOFO) Opens

Friday, November 10th, 2023 Final Date to Submit Questions

Friday, December 1st, 2023 NOFO Closes – Application Deadline

March 2024 Anticipated Notification of Selection

June 2024 – August 2024 Anticipated Awards

Application packages must be submitted electronically to EPA through Grants.gov no later than

Friday, December 1, 2023, at 11:59 p.m. Eastern Time (ET) to be considered for funding.

The total estimated funding expected to be available for awards under this competitive opportunity is approximately $115 million; $58 million funded with FY 2022 funding and $57 million funded with FY 2023 funding.

https://www.grants.gov/

TABLE OF CONTENTS

TITLE: 2022-2023 Diesel Emissions Reduction Act (DERA) National Grants

I. FUNDING OPPORTUNITY DESCRIPTION

A. Background and Summary

B. Program Goals and Objectives

C. Environmental Results and Strategic Plan Information

D. Statutory Authority & Assistance Listings

E. Additional Provisions for Applicants Incorporated into the Solicitation

II. FEDERAL AWARD INFORMATION

A. Amount of Funding Available

B. Number and Amount of Awards

C. Partial Funding

D. Additional Awards

E. Period of Performance

F. Funding Type

III. ELIGIBILITY INFORMATION

A. Eligible Entities

B. Cost Sharing

C. Threshold Criteria

D. Eligible and Ineligible Activities and Other Considerations

IV. APPLICATION AND SUBMISSION INFORMATION

A. Requirement to Submit Through Grants.gov and Limited Exception Procedures

B. EPA Region Project Location for Application Submission

C. Project Narrative Instructions, Format, and Content

D .Releasing Copies of Applications

V. APPLICATION REVIEW INFORMATION

A. Evaluation Criteria

B. Review and Selection Process

C. Other Factors

D. Anticipated Announcement and Federal Award Dates

VI. AWARD ADMINISTRATION INFORMATION

A. Award Notices

B. Combining Successful Applications into One Award

C. Administrative and National Policy Requirements

D. Reporting Requirement

E. Disputes

F. Equipment Use, Management, and Disposition

VII. CONTACT INFORMATION

APPENDIX A – Further information Regarding Contracts, Subawards, and Participant Support

Costs…………

APPENDIX B – Quantifying Environmental Outcomes

APPENDIX C – Mandated Measures Justification

APPENDIX D – Application Submission Checklist

I. FUNDING OPPORTUNITY DESCRIPTION

A. Background and Summary

This notice announces the availability of funds under the Diesel Emissions Reduction Act

(DERA) program and solicits applications from eligible entities to incentivize and accelerate the upgrading or retirement of the nation’s legacy diesel engine fleet. Eligible activities include the retrofit or replacement of existing diesel engines, vehicles, and equipment with EPA and

California Air Resources Board (CARB) certified engine configurations and verified retrofit and idle reduction technologies.

Applications will be accepted from regional, state, or local agencies; Tribal governments (or intertribal consortia) or Alaska Native Villages; or port authorities, which have jurisdiction over transportation or air quality. School districts, municipalities, metropolitan planning organizations (MPOs), cities, and counties are all generally eligible entities under the program to the extent that they fall within these categories. Applications will also be accepted from nonprofit organizations or institutions that represent or provide pollution reduction or educational services to persons or organizations that own or operate diesel fleets; or have, as their principal purpose, the promotion of transportation or air quality.

EPA anticipates awarding a total of approximately $115 million under this NOFO: $58 million in

FY 2022 funding and $57 million in FY 2023 funding; it is anticipated that approximately 4-10 cooperative agreements will be made per each of EPA’s ten regions subject to the availability of funds, the quantity and quality of applications received, and other considerations.

There are several ways DERA recipients may implement projects and fund project partners depending on the roles and responsibilities of each. If the applicant is the owner of the target vehicles, the applicant may directly implement the project. If the applicant is partnering with diesel fleet owners, the applicant may award subawards or participant support costs (i.e., rebates). Please refer to Appendix A for detailed guidance on funding partnerships.

Reducing emissions from diesel engines is one of the most important air quality challenges facing the country. From transportation to energy generation, the diesel engine powers almost every sector of the American economy. Due to more stringent EPA diesel engine emissions standards over the past few decades, engines currently coming off the manufacturing line are now sixty times cleaner1. However, despite these tighter standards for new engines, the nearly eight million legacy diesel engines already in use continue to emit large amounts of PM2.5 and

NOx. “Legacy diesel engines” are defined by the DERA program as the operating nonroad diesel and medium to heavy-duty highway diesel engines with engine model years 2009 and earlier.

Previously, DERA defined legacy engines as 2006 and earlier, but this has been expanded to include 2007-2009 engines which do not meet current emission standards. These air pollutants contribute to serious public health problems like asthma, lung disease, and various other cardiac and respiratory illnesses, which result in thousands of premature deaths, millions of lost workdays, and numerous other negative health impacts every year in the United States.

1 Heavy-Duty Highway Compression-Ignition Engines and Urban Buses: Exhaust Emission Standards https://www.epa.gov/aboutepa/regional-and-geographic-offices https://nepis.epa.gov/Exe/ZyPDF.cgi?Dockey=P100O9ZZ.pdf

To address these diesel emissions and protect public health and air quality, EPA is authorized under DERA to offer funding assistance to accelerate the upgrade, retrofit, and turnover of the legacy diesel fleet. Since the inaugural year of funding for DERA in 2008, EPA has awarded over $800 million to replace or retrofit approximately 73,700 engines or vehicles to reduce diesel emissions nationwide.2 The DERA program promotes an array of diesel emissions strategies by working with manufacturers, fleet operators, air quality professionals, environmental and community organizations, and state and local officials to address the varying emissions reductions in areas receiving disproportionate impacts from diesel fleets to provide an environment where all people enjoy the same degree of protection from environmental and health hazards.

This NOFO is a competitive grant program. The DERA program has another competitive funding opportunity, DERA Tribal and Insular Area Grants, which funds similar activities but is only open to eligible Tribal and Insular Area applicants. Funding for school bus replacement is also available through EPA’s Clean School Bus Program.

B. Program Goals and Objectives

1. DERA Programmatic Priorities: The Diesel Emissions Reduction Act (DERA) allows EPA to prioritize certain applicants in the DERA National Grants. The statute enables the program to prioritize projects that maximize public health benefits, are the most cost-effective, and that serve areas with the highest population density, that are poor air quality areas (including nonattainment or maintenance areas and areas with toxic air pollutant concerns), that receive a disproportionate quantity of air pollution from diesel fleets, or that use a community-based multistakeholder collaborative process to reduce toxic emissions. The following sections define the DERA National Grants programmatic priorities under this NOFO. Applications which address and demonstrate that the project meets these programmatic priorities will receive priority for funding under the evaluation criteria defined in Section V of this NOFO.

a. Goods Movement Facilities: Priority for funding is given to projects based on whether the vehicles/engines/equipment targeted for diesel emissions reductions are located at, or service, goods movement facilities as defined below. Applicants should include the name of the specific port, airport, rail yard, terminal, or distribution center where the affected vehicles operate. Points will be based upon the percentage of time targeted vehicles operate at, and/or the percentage of the total targeted vehicles that operate at, goods movement facilities.

1) Ports – places alongside navigable water with facilities for the loading and unloading of passengers and/or cargo from ships, ferries, and other vessels

2) Airports – places where aircraft operate that have paved runways and terminals which include cargo, baggage and/or passenger-movement operations

3) Rail Yards – a system of tracks, other than main tracks and sidings, used for making up trains, for storing cars, and for other purposes

4) Terminals – freight and passenger stations at the end of carrier lines, or that serve as junctions at any point with other lines, that have facilities for the handling of freight and/or passengers

2 https://nepis.epa.gov/Exe/ZyPDF.cgi?Dockey=P1015S8Q.pdf https://www.epa.gov/dera/tribal-insulararea https://www.epa.gov/cleanschoolbus https://nepis.epa.gov/Exe/ZyPDF.cgi?Dockey=P1015S8Q.pdf

5) Distribution Centers – facilities that perform consolidation, warehousing, packaging, decomposition, and other functions linked with handling freight, often in proximity to major transport routes or terminals, and/or which generate large amounts of truck traffic

b. Environmental Justice and Disadvantaged Communities: Environmental justice (EJ) is the just treatment and meaningful involvement of all people regardless of race, color, national origin, income, Tribal Affiliation, or disability in agency decision-making and other Federal activities that affect human health and the environment. Fair treatment means no group of people should bear a disproportionate share of the negative environmental consequences resulting from industrial, governmental, and commercial operations or policies. Meaningful involvement means people have an opportunity to participate in decisions about activities that may affect their environment and/or health;

the public's contribution can influence the regulatory agency's decision; community concerns will be considered in the decision-making process; and decision makers will seek out and facilitate the involvement of those potentially affected. EPA will evaluate environmental justice issues under criterion 3 of Section V.A. of this NOFO.

The DERA statute enables the program to prioritize projects that serve poor air quality areas (including nonattainment or maintenance areas and areas with air toxic air pollutant concerns), and those that use a community-based multistakeholder collaborative process to reduce toxic emissions. This allows the program to target communities with potential environmental justice concerns; that is, communities adversely and disproportionately affected by environmental, climate change, and human health harms or risks, and support a broad geographic distribution of funds. Additionally, DERA has been identified as part of the Justice40 Initiative, which creates a goal that 40 percent of applicable federal benefits flow to disadvantaged communities.3

1) Disadvantaged Communities: For the purposes of this NOFO, “disadvantaged communities” are defined as meeting one or both of the following criteria:

a) Nonattainment or Maintenance Area: These counties are identified as priority project locations for the DERA program because they are designated as nonattainment areas or maintenance areas for the following National Ambient Air

Quality Standards. Data is sourced from EPA’s Green Book of Nonattainment

Areas for Criteria Pollutants.

i. PM2.5 1997 Standard (Annual: 15 μg/m3, 24-hour: 65 μg/m3)

ii. PM2.5 2006 Standard (Annual: 15 μg/m3, 24-hour: 35 μg/m3)

iii. PM2.5 2012 Standard (Annual: 12 μg/m3, 24-hour: 35 μg/m3)

iv. Ozone (O3) 2008 Standard (8-hour: 0.075ppm)

v. Ozone (O3) 2015 Standard (8-hour: 0.070ppm)

The term “project location” refers to the area(s) where the affected vehicles or engines equipment operate. A list of counties that have been designated as priority project locations can be found on the DERA National Grants website.

3 Tackling the Climate Crisis at Home and Abroad, 86 Fed. Reg., 7619 (Feb. 1, 2021).

http://www.epa.gov/green-book http://www.epa.gov/green-book http://www.epa.gov/dera/national#NOFO

b) Area of Air Toxics Concern: These counties are identified as priority project locations for the DERA program because they contain at least one census tract where the modeled ambient diesel PM concentration from the 2019 Air Toxics

Screening Assessment is above the 80th percentile (0.38 µg/m3 for 2019) for census tracts nationwide. The 80th percentile is a programmatic cutoff designed to help evaluate those areas that are most likely to have higher concentrations of diesel PM in the year of analysis (i.e., the year for which data are available); this level was not chosen based on risk or other health-based criteria or thresholds.

AirToxScreen is a screening tool and there are limitations and uncertainties associated with it; see: AirToxScreen Limitations.

These program criteria for “disadvantaged communities” are drawn from the prioritization authorization described in the DERA statute.4 The methodology for calculating covered program benefits to disadvantaged communities may be updated in the future as additional funding opportunities are offered under the program.

2) Community Engagement: Priority for funding is given to applications which demonstrate engagement with the affected communities and/or populations, especially local residents, to ensure their meaningful participation with respect to the design, planning, and performance of the project. Meaningful involvement means people have an opportunity to participate in decisions about activities that may affect their environment and/or health; the public's contribution can influence the regulatory agency’s decision; community concerns will be considered in the decision-making process; and decision makers will seek out and facilitate the involvement of those potentially affected.

c. Project Resilience to Climate Impacts: Priority for funding is given to applications which demonstrate the ability to protect grant funded investments from severe weather events. EPA will evaluate applications based on the quality and extent to which the project assesses and implements adaptation considerations described below to help ensure that the project achieves its expected outcomes even as the climate changes.

Adapting to climate change involves actions by individuals, businesses, governments, and others to build resilience and reduce vulnerability of human and natural systems to unavoidable climate impacts. Adaptation also reduces the long-term costs of responding to these impacts. Applicants can demonstrate consideration of climate change adaptation through measures taken to anticipate, prepare for, and avoid adverse impacts of climate change. For example, assessing project vulnerability to climate impacts can be incorporated into project planning, such as siting decisions and operational plans.

Measures taken to avoid damages could include ensuring fleets and equipment are protected from impacts such as flooding and sea level rise and protecting infrastructure from storm damage.

4 https://uscode.house.gov/view.xhtml?path=/prelim@title42/chapter149/subchapter7/partF&edition=prelim https://www.epa.gov/AirToxScreen https://www.epa.gov/AirToxScreen https://www.epa.gov/AirToxScreen https://www.epa.gov/AirToxScreen/airtoxscreen-limitations

2. Workforce Development: Evaluation criteria points will be given to applications that demonstrate plans and activities to prepare their workforce for the project, such as conducting robust workforce planning to ensure current drivers, mechanics, electricians, and other essential personnel receive training to safely operate and maintain the new vehicles, engines, infrastructure, and equipment, in order to maximize the useful life of any certified engine configuration, verified technology, or emerging technology used or funded by the eligible entity. Additionally, evaluation criteria points will be given to applications which demonstrate policies and protections that currently exist or will be put in place to prevent existing workers from being replaced or displaced because of new technologies purchased with funding awarded under this NOFO. Evaluation criteria points will be given to applicants who demonstrate that they engage with workers and their representatives directly in the development of workforce planning activities to incorporate worker voice into the project.

EPA will evaluate this criterion based on the quality and extent of the workforce planning activities. Applicants can demonstrate workforce planning by clearly articulating which types of jobs will be impacted by the project, how they have or will engage those workers, how they will provide training, resources, and support to those workers for implementing the project (including the amount of time workers will spend in training and the skills they will develop), and clarifying if workers will be compensated with their regular wages for their time spent in training. Plans should make clear how they prioritize the health and safety of workers through evidence of a health and safety program that adheres to Occupational Safety and Health Administration regulations or other applicable regulations, including any modifications needed in response to the project. Where applicable, electricians working on

EVSE are strongly encouraged to be certified by the Electric Vehicle Infrastructure Training

Program.

3. Diesel Vehicles, Engines and Equipment: Projects may target in-use medium and heavy-duty diesel-powered highway vehicles and diesel powered nonroad vehicles and equipment, as defined in Table 1, below.

Table 1: Diesel Vehicles, Engines and Equipment

School Buses

Includes diesel powered school buses of Type A, B, C and D. A “school bus” is defined as a passenger motor vehicle, designed to carry a driver and more than 10 passengers, that the Secretary of Transportation decides is likely to be used significantly to transport preprimary, primary, and secondary school students to or from school or an event related to school.

Transit Buses Includes diesel powered medium-duty and heavy-duty transit buses (see definition of eligible Class 5-8 vehicles below).

Medium-duty or heavy-duty trucks

Includes diesel powered medium-duty and heavy-duty highway vehicles with gross vehicle weight rating (GVWR) as defined below:

Class 5 (16,001 -19,500 lbs GVWR);

Class 6 (19,501 – 26,000 lbs GVWR);

Class 7 (26,001 – 33,000 lbs GVWR);

Class 8 (33,001 lbs GVWR and over)

Marine Engines Includes diesel powered Category 1, 2, and 3 marine engines and vessels.

https://evitp.org/ https://evitp.org/

Locomotives Includes diesel powered line-haul, passenger, and switch engines and locomotives.

Nonroad engines, equipment, or vehicles5

Diesel powered nonroad engines, equipment, and vehicles including, but not limited to, those used in construction, handling of cargo (including at ports and airports), agriculture, mining, or energy production (including stationary generators and pumps). Eligible nonroad equipment includes transport refrigeration units (TRUs). Please see the TRU Factsheet found on the DERA National Grants website for information on TRUs and eligible

TRU projects.

4. Diesel Emission Reduction Solutions: Projects may upgrade existing diesel vehicles and equipment using the diesel emissions reduction solutions defined in Table 2, below.

Table 2. Diesel Emission Reduction Solutions

Certified

Vehicle and

Equipment

Replacements

Nonroad and highway diesel vehicles and equipment, locomotives, and marine vessels can be replaced with newer, cleaner, vehicles and equipment.

Eligible replacement highway vehicles include those certified by EPA and/or

CARB to run on diesel or clean alternative fuel engines (including gasoline), electric generators (gensets), hybrid engines, and zero tailpipe emissions power sources (grid, battery, or fuel cell). Eligible replacement nonroad equipment, locomotives, and marine vessels include those powered by EPA and/or CARB certified diesel or clean alternative fuel engines (including gasoline), electric generators (gensets), hybrid engines. Nonroad equipment, locomotives, and marine vessels powered by zero tailpipe emissions power sources (grid, battery, or fuel cell) do not require EPA or CARB certification.

Certified

Engine

Replacement

Nonroad and highway diesel vehicles and equipment, locomotives, and marine vessels can have their engines replaced with newer, cleaner, engines.

Eligible replacement highway engines include those certified by EPA and/or

CARB for use with diesel or cleaner alternative fuels (including gasoline), electric generators (gensets), and hybrid engines, and zero tailpipe emissions power sources (grid, battery, or fuel cell). Eligible replacement nonroad, locomotive, and marine engines include those powered by EPA and/or

CARB certified diesel or clean alternative fuel engines (including gasoline), electric generators (gensets), and hybrid engines. Nonroad equipment, locomotives, and marine vessel engine replacement with zero tailpipe emissions power sources (grid, battery, or fuel cell) do not require EPA or

CARB certification.

https://www.epa.gov/system/files/documents/2023-07/420f23005_0.pdf https://www.epa.gov/dera/national#NOFO

Certified

Remanufacture

Systems

Generally, a certified remanufacture system is applied during an engine rebuild and involves the removal of parts on an engine and replacement with parts that cause the engine to represent an engine configuration which is cleaner than the original engine. Some locomotives and marine engines can be upgraded through the application of a certified remanufacture system (i.e., kit). Engine remanufacture systems may not be available for all engines, and not all remanufacture systems may achieve an emissions benefit.

Applications for EPA certified remanufacture systems should include a discussion of the availability of engine remanufacture systems and indicate the pre- and post-project emission standard levels of the engines to demonstrate that the upgrade will result in a PM and/or NOx emissions benefit.

Verified Idle

Reduction

Technologies

An idle reduction project is generally defined as the installation of a technology or device that reduces unnecessary idling of diesel engines and/or is designed to provide services (such as heat, air conditioning, and/or electricity) to vehicles and equipment that would otherwise require the operation of the main drive or auxiliary engine(s) while the vehicle is temporarily parked or remains stationary. EPA SmartWay verified technologies currently include options to reduce idling for long haul Class 8 trucks equipped with sleeper cabs, school buses, transport refrigeration units, locomotives, and marine vessels.

Verified

Retrofit

Technologies

Diesel engine retrofits are one of the most cost-effective solutions for reducing diesel engine emissions. Retrofits include engine exhaust after-treatment technologies, such as diesel oxidation catalysts (DOCs), diesel particulate filters (DPFs), closed crankcase ventilation systems (CCVs), and selective catalytic reduction systems (SCRs). Manufacturer engine upgrades which achieve specific levels of emission reductions by applying a package of components have been verified as retrofits for some nonroad and marine engines. Several systems which convert a conventional diesel engine configuration to a hybrid-electric system have been verified as retrofits for some nonroad and marine engines. Some cleaner fuels and additives have been verified as retrofits by EPA and/or CARB to achieve emissions reductions when applied to an existing diesel engine. Older, heavy-duty diesel vehicles that will not be retired for several years are good candidates for verified retrofit technologies. EPA suggests that applicants proposing to install verified retrofit technologies consult with suppliers to confirm that the proposed vehicles/engines and their duty-cycles are good candidates for the technology.

Clean

Alternative

Fuel

Conversions

Existing highway diesel engines can be altered to operate on alternative fuels such as propane and natural gas by applying a certified alternative fuel conversion kit.

Verified

Aerodynamic

Technologies and Low

Rolling

Resistance

Tires

To improve fuel efficiency, long haul Class 8 trucks can be equipped with

EPA verified aerodynamic devices and/or low rolling resistance tires.

C. Environmental Results and Strategic Plan Information

Pursuant to Section 6.a. of EPA Order 5700.7A1, “Environmental Results under EPA Assistance

Agreements,” EPA must link proposed assistance agreements with the Agency’s Strategic Plan.

EPA also requires that grant applicants and recipients adequately describe environmental outputs and outcomes to be achieved under assistance agreements (see EPA Order 5700.7A1, Environmental Results under Assistance Agreements). Applicants must include specific statements describing the environmental results of the proposed project in terms of well-defined outputs and, to the maximum extent practicable, well-defined outcomes that will demonstrate how the project will contribute to the Strategic Plan goals listed below.

1. Linkage to EPA Strategic Plan: The activities to be funded under this announcement support EPA’s Fiscal Year (FY) 2022-2026 Strategic Plan. Awards made under this announcement will support Goal 1, “Tackle the Climate Crisis” Objective 1.1, “Reduce

Emissions that Cause Climate Change,” of EPA’s Strategic Plan. All applications must be for projects that support the goals and objectives above. For more information see EPA’s FY

2022 - FY 2026 EPA Strategic Plan.

2. Outputs: The term “output” means an environmental activity, effort, and/or associated work product related to an environmental goal or objective that will be produced or provided over a period of time or by a specified date. Outputs may be quantitative or qualitative but must be measurable during an assistance agreement funding period.

Expected outputs from the projects to be funded under this announcement may include, but are not limited to:

• Number of replaced or retrofitted engines/vehicles/equipment; and/or

• Hours of idling reduced.

Progress reports and a final report will also be required outputs, as specified in Section VI.D.

“Reporting Requirement,” of this NOFO.

Other potential outputs may include, but are not limited to:

• Engaging with local residents to ensure their meaningful participation with respect to the design, planning, and performance of the project

• The project’s inclusion in a broader-based environmental or air quality plan http://www.epa.gov/sites/production/files/2015-03/documents/epa_order_5700_7a1.pdf http://www.epa.gov/sites/production/files/2015-03/documents/epa_order_5700_7a1.pdf https://www.epa.gov/planandbudget/strategicplan https://www.epa.gov/planandbudget/strategicplan

• The implementation of contract specifications requiring the use of cleaner vehicles and equipment

• A documented commitment to continue to identify and address air quality issues in the affected community

• Establishing a clear point of contact in a public platform for community issues and complaints

• A publicly documented policy or process for getting community input on operations and projects that impact air quality

• Adoption of an idle reduction policy

• The completion of a baseline mobile source emission inventory for PM2.5 and or NOx;

• Providing support to clean diesel coalitions by sharing information, working with interested fleets, and addressing specific geographic needs

• Number of subawards; and/or

• Dissemination of project/technology information via listservs, websites, journals, and outreach events

3. Outcomes: The term “outcome” means the result, effect or consequence that will occur from carrying out an environmental program or activity that is related to an environmental or programmatic goal or objective. Outcomes may be environmental, behavioral, health-related, or programmatic in nature, but should also be quantitative. They may not necessarily be achievable within an assistance agreement funding period.

Expected outcomes from the projects to be funded under this announcement include, but are not limited to:

• Tons of pollution reduced over the lifetime of the vehicles/engines/equipment, specifically:

o fine particulate matter (PM2.5) o nitrogen oxides (NOx) o carbon monoxide (CO) and carbon dioxide (CO2), and/or o volatile organic compounds (VOCs)

• Tons of pollution reduced annually

• Lifetime total project cost effectiveness for NOx and PM2.5

• Lifetime capital cost effectiveness for NOx and PM2.5

• Net reduction in gallons of diesel fuel used

• Benefits to disadvantaged communities, including improvements to human health and the environment, the local economy, social conditions, and the welfare of residents in such communities.

Applicants should follow the instructions in Appendix B of this announcement for calculating emissions reductions and cost effectiveness.

Other potential outcomes may include, but are not limited to:

• Community engagement and partnership

• Improved ambient air quality

• Health benefits achieved

• Changes in driver behavior regarding idling practices

• An increased understanding of the environmental or economic effectiveness of the implemented technology

• Increased public awareness of project and results

• Widespread adoption of the implemented technology

• Demonstration and deployment of zero and near-zero emission vehicles and engines

• Emissions reductions along freight transportation corridors

4. Performance Measures: The applicant should also develop performance measures they expect to achieve through the proposed activities and describe them in their application.

These performance measures will help gather insights and will be the mechanism to track progress concerning successful processes and output and outcome strategies and will provide the basis for developing lessons to inform future recipients. Additional details on reporting requirements are included in Section VI.D. It is expected that the description of performance measures will directly relate to the project outcomes and outputs.

The description of the performance measures should directly relate to the project’s outcomes and outputs, including but not limited to:

• Overseeing subrecipients, and/or contractors and vendors

• Tracking and reporting project progress on expenditures and purchases

• Tracking, measuring, and reporting accomplishments and proposed timelines/milestones

• Tracking and reporting project progress on installations/replacements by maintaining an accurate project fleet description

• Measuring and reporting on outcomes by maintaining an accurate project fleet description and using EPA’s diesel emissions quantifier

• Efforts should be made to track, measure, and report the actual vehicle miles traveled, hours of use/operation, and fuel use for all vehicles and equipment involved in the project

The following are questions to consider when developing output and outcome measures of quantitative and qualitative results:

• What are the measurable short term and long term results of the project?

• How does the plan measure progress in achieving the expected results (including outputs and outcomes) and how will the approach use resources effectively and efficiently?

D. Statutory Authority & Assistance Listings

The Diesel Emissions Reduction Act Program is authorized by Title VII, Subtitle G of the

Energy Policy Act of 2005, 42 USC 16131, et seq., as amended. DERA authorizes the award of grants to reduce diesel emissions and diesel emissions exposure, particularly from fleets operating in areas designated by the Administrator as poor air quality areas. While EPA has authority under DERA to support grant programs, EPA’s authority to obligate grant funds is subject to the availability of appropriated funds.

E. Additional Provisions for Applicants Incorporated into the Solicitation

Additional provisions that apply to Sections III, IV, V, and VI of this solicitation and/or awards made under this solicitation, can be found at EPA Solicitation Clauses. These provisions are important for applying to this solicitation and applicants should review them when preparing applications for this solicitation. If you are unable to access these provisions electronically at the website above, please contact dera@epa.gov listed in Section VII of this solicitation to obtain the provisions.

II. FEDERAL AWARD INFORMATION

A. Amount of Funding Available

The total estimated funding expected to be available for awards under this competitive opportunity is approximately $115 million; $58 million funded with FY 2022 funding and $57 million funded with FY 2023 funding. Funding is dependent upon agency appropriations, funding availability, Agency priorities, and other considerations. Individual applications requesting EPA funding more than the amount specified below will not be considered.

Please see section IV.B. of this NOFO for more information on EPA’s ten regions.

Applicants must request funding at or below the maximum funding request amount listed for the

EPA regional office which covers their geographic project location. The term “project location” as used in this NOFO refers to the area(s) where the affected vehicles or engines operate. See

Section IV.B. for additional information on project location and the geographic boundaries for each EPA regional office. DERA national grant funding is dispersed amongst the ten EPA regional offices by a formula based on: 1) the percentage of the population that is living in PM2.5 and Ozone nonattainment areas that are attributable to the region, and 2) the percentage of the total NOx and diesel PM emissions from mobile sources that are attributable to the region.

Table 3. Total Funding and Funding Limits by Region

Region Total Anticipated Funding

Per Region

Maximum Federal Funding Request

Per Application

1 $6,200,000 $2,000,000

2 $11,400,000 $3,500,000

3 $11,900,000 $3,500,000

4 $11,800,000 $2,500,000

5 $13,900,000 $4,000,000

6 $14,000,000 $3,000,000

7 $8,000,000 $3,500,000

8 $9,700,000 $3,000,000

9 $22,200,000 $4,500,000

10 $6,200,000 $1,500,000

TOTAL $115,300,000 -

http://www.epa.gov/grants/epa-solicitation-clauses mailto:dera@epa.gov

B. Number and Amount of Awards

It is anticipated that approximately 4-10 cooperative agreements per EPA region will be made from this announcement subject to the availability of funds, the quantity and quality of applications received, agency priorities, and other applicable considerations. If EPA selects multiple applications from an applicant, EPA may combine the selected applications into one grant award for the successful applicant (See Section VI.A.1. Combining of Successful

Applications into One Award).

C. Partial Funding

In appropriate circumstances, EPA reserves the right to partially fund applications by funding discrete portions of proposed projects. If EPA decides to partially fund an application, it will do so in a manner that does not prejudice any applicants or affect the basis upon which the application is evaluated and selected for award, thereby maintaining the integrity of the competition and selection process.

D. Additional Awards

EPA reserves the right to make additional awards under this solicitation, consistent with Agency policy and guidance, if additional funding becomes available after the original selections are made. Any additional selections for awards will be made no later than 6 months after the original selection decisions.

In addition, EPA reserves the right to reject all applications and make no awards under this announcement or to make fewer awards than anticipated.

E. Period of Performance

The estimated project period for awards resulting from this solicitation is 24 months, however project periods of up to 48 months will be allowed where justified by the activities, timeline, and milestones detailed in the workplan. The estimated project period of performance start date for awards will begin starting July 1, 2024.

F. Funding Type

The funding for selected projects will be in the form of a cooperative agreement. Cooperative agreements provide for substantial involvement between the EPA project officer and the selected applicants in the performance of the work supported. Although EPA will negotiate precise terms and conditions relating to substantial involvement as part of the award process, the anticipated substantial federal involvement for these projects may include:

• Close monitoring of the successful applicant’s performance to verify the results proposed by the applicant

• Collaboration during performance of the scope of work

• EPA prior review or approval of project phases or the substantive provisions of proposed contracts found within the scope of the cooperative agreement

• In accordance with 2 CFR § 200.317 and 2 CFR § 200.318, review of proposed procurement

• Approving qualifications of key personnel (EPA will not select employees or contractors employed by the award recipient)

• Review and comment on reports prepared under the cooperative agreement (the final decision on the content of reports rests with the recipient)

EPA does not have the authority to select employees or contractors employed by the recipient.

The final decision on the content of reports rests with the recipient.

III. ELIGIBILITY INFORMATION

Note: Additional provisions that apply to this section can be found at EPA Solicitation Clauses.

A. Eligible Entities

In accordance with Assistance Listing 66.039, and EPA’s Policy for Competition of Assistance

Agreements (EPA Order § 5700.5A1), the following entities are eligible to apply:

1. A regional, state (including the District of Columbia), or local agency, Tribal agency, or port authority, which has jurisdiction over transportation or air quality. School districts, municipalities, metropolitan planning organizations (MPOs), cities, and counties are all generally eligible entities under this assistance agreement program to the extent that they fall within this definition.

2. A nonprofit organization or institution that:

a. represents or provides pollution reduction or educational services to persons or organizations that own or operate diesel fleets; or

b. has, as its principal purpose, the promotion of transportation or air quality.

Non-profit organization, as defined by 2 CFR 200.1, means any corporation, trust, association, cooperative, or other organization that: (1) is operated primarily for scientific, educational, service, charitable, or similar purposes in the public interest; (2) is not organized primarily for profit; and (3) uses its net proceeds to maintain, improve and/or expand its operations.

Note that 2 CFR Part 200 specifically excludes the following types of organizations from the definition of “non-profit organization” because they are separately defined in the regulation: (i) institutions of higher education; and (ii) state, local and federally-recognized Indian Tribal governments. While not considered to be a “non-profit organization(s)” as defined by 2 CFR

200.1, Institutions of Higher Education are, nevertheless, eligible to submit applications under this NOFO to the extent they fall within the definition in 2.a. and b., above. Hospitals operated by state, Tribal, or local governments or that meet the definition of nonprofit at 2 CFR 200.1 are also eligible to apply. For-profit colleges, universities, trade schools, and hospitals are not https://www.epa.gov/grants/epa-solicitation-clauses https://www.epa.gov/grants/epa-order-57005a1-epas-policy-competition-assistance-agreements https://www.epa.gov/grants/epa-order-57005a1-epas-policy-competition-assistance-agreements eligible to apply.

For-profit organizations are not an eligible entity for this funding opportunity. Additionally, non-profit organizations described in Section 501(c)(4) of the Internal Revenue Code that engage in lobbying activities as defined in Section 3 of the Lobbying Disclosure Act of 1995 are not eligible to apply.

Eligible Tribal agencies are defined as Federally recognized Indian tribal governments, which are any Indian tribe, band, nation, or other organized group or community (including Alaska

Native Villages) certified by the Secretary of the Interior as eligible for the special programs and services provided through the Bureau of Indian Affairs, as well as any organization or intertribal consortium that represents federally recognized tribes.

For the purposes of this NOFO, “intertribal consortium” is defined as a partnership between two or more eligible Tribal agencies as defined above, that is authorized by the governing bodies of those tribes to apply for and receive assistance under this program. Intertribal consortia are eligible to receive assistance under this program only if the consortium demonstrates that all members of the consortium meet the eligibility requirements for the program and authorize the consortium to apply for and receive assistance by submitting to EPA documentation of (1) the existence of the partnership between Indian tribal governments, and (2) authorization of the consortium by all its members to apply for and receive the assistance.

B. Cost Sharing

Any form of cost share, mandatory or voluntary, must be included in the budget detail portion of the project narrative, and the application must describe how and when the applicant will obtain the cost share and how the cost share funding will be used. Applicants may use their own funds or other sources for cost share if the standards of 2 CFR Part 200, as applicable, are met. If the proposed cost share is to be provided by a named project partner, a letter of commitment is required. Only eligible and allowable costs may be used for cost share.

Please note: DERA funds may not be used to meet mandatory cost sharing requirements for projects funded with environmental mitigation funds resulting from federal settlements (e.g., Volkswagen Environmental Mitigation Trust). Further, federal environmental mitigation funds may not be used to meet non-federal mandatory cost share requirements of any DERA grant.

1. Mandatory Cost Share Requirement: Projects are subject to the funding limitations and mandatory cost share requirements shown in Table 4, below.

Table 4: Cost Share Requirements

Eligible Technologies EPA Funding

Limit

Mandatory

Cost Share

Drayage Truck Replacement 50% 50%

Vehicle or Equipment Replacement with EPA Certified

Engine 25% 75%

Vehicle or Equipment Replacement with CARB Certified Low

NOx Engine 35% 65%

Vehicle or Equipment Replacement with Zero-tailpipe

Emission Power Source 45% 55%

Engine Replacement with EPA Certified Engine 40% 60%

Engine Replacement with CARB Certified Low NOx Engine 50% 50%

Engine Replacement with Zero-tailpipe Emission Power

Source 60% 40%

EPA Certified Remanufacture Systems 100% 0%

EPA Verified Highway Idle Reduction Technologies when combined with new or previously installed exhaust after-treatment retrofit

100% 0%

EPA Verified Highway Idle Reduction Technologies without new exhaust after-treatment retrofit 25% 75%

EPA Verified Locomotive Idle Reduction Technologies 40% 60%

EPA Verified Marine Shore Connection Systems 25% 75%

EPA Verified Electrified Parking Space Technologies 30% 70%

EPA Verified Exhaust After-treatment Retrofits 100% 0%

EPA Verified Engine Upgrade Retrofits 100% 0%

EPA Verified Hybrid Retrofit Systems 60% 40%

EPA Verified Fuel and Additive Retrofits when combined with new retrofit, upgrade, or replacement

Cost differential between conventional diesel fuel

Cost of conventional diesel fuel

EPA Verified Aerodynamics and Low Rolling Resistance

Tires when combined with new exhaust after-treatment retrofit 100% 0%

Alternative Fuel Conversion 40% 60%

Applications that include projects with mandatory cost share requirements must demonstrate on the SF-424 Application for Federal Assistance, on the SF-424A Budget Information for

Non-Construction Programs, and in the project narrative how the applicant will be able to meet these minimum mandatory cost share requirements if they are selected for an award, or the application may be disqualified during the threshold eligibility review. Specifically, the mandatory cost share funds must be indicated in at least one of the following blocks in

Section 18, Estimated Funding, on the SF-424: b. Applicant; c. State; d. Local; or e. Other.

The mandatory cost shared funds must also be indicated on the SF 424A in Section A

Column (f), Section B columns (2), (3) and/or (4), and Section C.

Cost sharing and matching requirements under $200,000 for Insular Area applicants (the U.S.

Virgin Islands, American Samoa, Guam and the Commonwealth of the Northern Mariana

Islands) are waived as a matter of law as authorized by the Omnibus Territories Act, 48

U.S.C. Section 1469a. Insular Area applicants with applications that will require a cost share of $200,000 or more are advised to contact EPA to determine if cost share requirements will be waived in whole or in part. For contact information, refer to Section VII. of the NOFO.

2. Voluntary Cost Sharing: Voluntary cost sharing is when an applicant voluntarily proposes to legally commit to provide costs or contributions to support the project when a cost share is not required. Applicants who propose to use a voluntary cost share must include the costs or contributions for the voluntary cost share in the project budget on the SF-424 and SF-424A.

Voluntary cost share will not be evaluated under the selection criteria in Section V. If an applicant proposes a voluntary cost share, the following apply:

• A voluntary cost share is subject to the applicable provisions of 2 CFR § 200.306, Cost sharing or matching.

• A voluntary cost share may only be met with eligible and allowable costs.

• The recipient may not use other sources of federal funds to meet a voluntary cost share unless the statute authorizing the other federal funding provides that the federal funds may be used to meet a cost share requirement on a federal grant or cooperative agreement.

The recipient is legally obligated to meet any proposed voluntary cost share that is included in the approved project budget. If the proposed voluntary cost share does not materialize during the performance period of the grant or cooperative agreement, EPA may reconsider the legitimacy of the award and/or take other appropriate action as authorized by 2 CFR Part

200.

C. Threshold Criteria

These are requirements that, if not met by the time of the application submission, will result in elimination of the application from consideration for funding. Only applications from eligible applicants (see Section III.A) that meet these all these criteria will be evaluated against the ranking criteria in Section V. of this NOFO. If necessary, EPA may contact applicants to clarify threshold eligibility questions prior to making an eligibility determination. Applicants deemed ineligible for funding consideration due to the threshold eligibility review will be notified within 15 calendar days of the ineligibility determination.

1. Application Submission

a. Applications must substantially comply with the application submission instructions and requirements set forth in Section IV of this solicitation or else they will be rejected.

However, where a page limit is expressed in Section IV with respect to the application, or parts thereof, pages in excess of the page limitation will not be reviewed. Applicants are advised that readability is of paramount importance and should take precedence in application format, including selecting a legible font type and size for use in the application.

b. In addition, initial applications must be submitted through Grants.gov as stated in Section

IV of this solicitation (except in the limited circumstances where another mode of submission is specifically allowed for as explained in Section IV) on or before the application submission deadline published in Section IV of this solicitation. Applicants are responsible for following the submission instructions in Section IV of this solicitation to ensure that their application is timely submitted. Please note that applicants experiencing technical issues with submitting through Grants.gov should follow the instructions provided in Section IV, which include both the requirement to contact

Grants.gov and email a full application to EPA prior to the deadline.

c. Applications submitted outside of Grants.gov will be deemed ineligible without further consideration unless the applicant can clearly demonstrate that it was due to EPA mishandling or technical problems associated with Grants.gov or SAM.gov. An applicant’s failure to timely submit their application through Grants.gov because they did not timely or properly register in SAM.gov or Grants.gov will not be considered an acceptable reason to consider a submission outside of Grants.gov.

2. Applications must support Goal 1, “Tackle the Climate Crisis” Objective 1.1, “Reduce

Emissions that Cause Climate Change,” of EPA’s Strategic Plan described in Section I.C.

3. Individual applications which request EPA assistance funds above the applicable regional amounts specified in Section II.A. of this NOFO are not eligible and will not be reviewed.

4. Individual applications which request EPA assistance funding from more than one EPA regional office are not eligible and will not be reviewed.

5. Applications that do not demonstrate compliance with the mandatory cost share requirements described in Section III.B.1.