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MEMORADUM OF UNDERSTANDING Page | of7 . MARICOPA COUNTY AIR QUALITY DEPARTMENT a 7 State Clean Diesel Grant & rogram Federal Award ID (FAIN): 98T26201-1 HENSLEY BE MPA VERAGE CO NY EPA Award Date: October 1, 2023 Effective Date: Upon Final Signature Agreement Title: State Clean Diesel Grant Program Sub Award Termination Date: December 31, 2025 Maricopa County Hensley Beverage Company 301 W. Jefferson St. Suite 410 4201 N. 45"" Ave. Phoenix, AZ 85012 Phoenix, AZ 85031 Name: Philip A. McNeely Name: Chris Yarrington Title: AQD Director Title: Director of Fleet & Facilities, Risk Management Phone: 602.506.6701 Phone 602.679.0397 Unique Entity Identifier (UEI) Name: Hensley & Co. Unique Entity Identifier (UEI) No.: VIMXSJ35NK75 AZ Congressional District: (1-9) 3 THIS CONTRACT is between MARICOPA COUNTY [hereinafter referred to as the “Maricopa County” or ‘the County”] and Hensley Beverage Company (HENSLEY). The purpose of this Agreement is to administer the funding provided by the Environmental Protection Agency (EPA) through Maricopa County to the subrecipient HENSLEY for the State Clean Diesel Grant Program Funding provided through the Diesel Emissions Reduction Act (DERA). As part of this Agreement, the Board of Supervisors is acting under the authority of A.R.S. 11-952 to enter into this agreement. HENSLEY will assume the following responsibilities: HENSLEY will procure the replacement of the vehicle/s in line with all applicable guidelines set forth by the FY2023-2024 Diesel Emissions Reduction Act (DERA) State Grants Program Guide as published by the EPA - Office of Transportation and Air Quality, July 2023. HENSLEY wil! provide a work plan via separate attachment to the County for review and approval prior to initiating work. HENSLEY will ask for written prior approval from the County for any work plan changes prior to initiating work not approved in original application/technical data worksheet. HENSLEY will schedule a giant foam check or program certificate presentation with Maricopa County to occur within 90 days of dated award letter or may choose to have a ribbon cutting presentation once replacement vehicles are received. Photos of presentation must be submitted to the County. HENSLEY will post a press release on their organization website within 30 days of the above-mentioned presentation. The press release and all outreach media pertaining to the subaward must have prior review and written approval from the County. This includes both written and spoken material. All outreach material must include the “DERA State Clean Diesel Grant Program”, the funding amount received, and the funding percentage received. Proof of the press release must be submitted to the County. HENSLEY will provide monthly reports to Maricopa County on the purchasing of the new vehicles and any issues that arise. HENSLEY will provide quarterly reports with complete updated technical data worksheet. HENSLEY will register as an entity on Sam.gov in order to receive federal grant funds. HENSLEY will register as a vendor to Maricopa County in order to be reimbursed for purchases. HENSLEY will provide detailed invoices to Maricopa County in order to be reimbursed for purchases. HENSLEY will complete all work defined in the project work plan by December 31, 2025. Page | of 7 2.1 2.2 2.3 2.4 6.1 6.2 HENSLEY will affix a County-provided DERA program sticker to all new program vehicles once received. The sticker must remain on the vehicle at all times. HENSLEY will submit all final project data required to close out the grant including programmatic, financial, and environmental results including a final updated technical data worksheet. AGREEMENT TERMS Recitals: The purpose of this Agreement is to administer the Diesel Emission Reduction Act (DERA) sub award, as explained under 42 U.S.C. 16133. Definitions: The Parties agree to expeditiously initiate and complete the scope of work under this Agreement. The Parties warrant, represent and agree that they, their employees and representatives will comply with all applicable provisions provided herein. The following definitions shall apply to the terms used in this Agreement, except where the context necessarily requires otherwise. “U.S.C.” means United States Code. “Agreement” means this written document between HENSLEY and the County. “County” means MARICOPA COUNTY, which is acting on behalf of the State of Arizona. "Parties" means Hensley Beverage Company (HENSLEY) and MARICOPA COUNTY. Access to Information: Subject to statutory confidentiality requirements of the County and HENSLEY, both parties to this Agreement shall have full, complete and equal access to data and information prepared under this Agreement on a no-charge basis. Amendment: This Agreement may be modified only by written Amendment signed by the Director or designee, of HENSLEY and the person duly authorized to act on behalf of the County. Amendments shall be executed with the same formalities as this Agreement. Executed copies of any Amendment shall be provided to both parties. Amount of Agreement: A maximum amount of $465,547.50 will be funded under this Agreement and includes up to ten percent additional funds if approved by the County during the project to offset vehicle replacement cost increases. The indirect cost rate for this Agreement is $0. Governing Law: This Agreement shall be governed by and construed in accordance with the laws of the State of Arizona. Any disputes shall be filed in the state or federal court within Phoenix, Arizona. Implied Consent Terms: Each provision of applicable law and any terms required by law to be in this Agreement are a part of this agreement as if fully stated in it. Assignment: Neither Party may assign any rights hereunder without the express, written, prior consent of the other Party. Audit of Records and Disallowances: HENSLEY shall retain all data, books and other records (“records”) relating to this Agreement for a period of five years after completion of the Agreement, any litigation, claim, negotiation, audit, cost recovery, or action involving the records has been completed. All records shall be subject to inspection and audit by the State of Arizona, County, and EPA at reasonable times. If any amount is determined to be disallowed by a federal, State, or County audit, the County shall notify HENSLEY in writing of such disallowance, and the County shall either adjust any future payment by the amount of the disallowance or require immediate repayment of the disallowed amount. Upon request, the HENSLEY shall produce the original of all records. Examples of such records include: a. Subrecipient financial statements and reports b. Programmatic reports including information on environmental results c. Audit findings Agreement Term: The initial term of this Agreement shall be from the date the final signatory signs the agreement and will be valid until December 31, 2025. Page 2 of 7 10. 11. 12. 12.1 12.2 13.3 14. 15. 17. 17.1 17.2 17.3 Effective Date: This Agreement shall become effective upon execution of the agreement by all parties. Non-Availability of Funds: Every payment obligation of the County under this Agreement is conditioned upon the availability of funds appropriated or allocated for the payment of such obligation. If funds are not allocated and available for the continuance of this Agreement, this Agreement may be terminated by either party at the end of the period for which funds are available. No liability shall accrue to either party in the event this provision is exercised, and the parties shall not be obligated or liable for any future payments or for any damages as a result of termination under this paragraph. Notices, Correspondence, Reports and Invoices: All notices and correspondence from the County shall be sent to: Chris Yarrington, Director of Fleet & Facilities, Risk Management Hensley Beverage Company 4201 N. 45" Ave. Phoenix, AZ 85031 602.679.0397 cyarrington@hensley.com All correspondence relating to the execution of the Agreement, clarification of this Agreement, and Agreement Amendments shall be sent to: For Hensley Beverage Company For Maricopa County: Chris Yarrington, Director of Fleet & Facilities, Larz Garcia, Grant Programs Administrator Risk Management Maricopa County Air Quality Hensley Beverage Company 301 W Jefferson St. Suite 410 4201 N. 45" Ave. Phoenix, AZ 85003 Phoenix, AZ 85031 602.506.0147 602.679.0397 i cyarrington@hensley.com Either party to this Agreement may designate a new contact by filing a notice with the other party in accordance with these notice requirements. Ownership of Information: Title to all documents, reports and data prepared in the course of this Agreement by HENSLEY shall rest with the County. The County shall have full and complete rights to reproduce, duplicate, disclose, perform, and otherwise use all information prepared under this Agreement. Reporting: Reporting pursuant to 42 U.S.C. 16133 shall be in accordance with the Scope of Work at the end of this Agreement. In addition, HENSLEY will provide quarterly status reports. Severability: The provisions of this Agreement are severable to the extent that any provision or application determined to be invalid shall not affect any other provision or application of the Agreement, which shall remain in effect without the invalid provision or application. Termination: HENSLEY or the County may terminate this Agreement at any time, with or without cause, after giving 30 days written notice of termination to the other party, as appropriate. The notice shall specify the effective date of termination. Notice is given that, pursuant to A.R.S. § 38-511, the County may cancel any contract without penalty or further obligation within three years after execution of the contract, if any person significantly involved in initiating, negotiating, securing, drafting, or creating the contract on behalf of the County is at any time, while the contract or any extension of the contract is in effect, an employee or agent of any other party to the contract in any capacity or consultant to any other party of the contract with respect to the subject matter of the contract. Additionally, pursuant to A.R.S. § 38-511, the County may recoup any fee or commission paid or due to any person significantly involved in initiating, negotiating, securing, drafting, or creating the contract on behalf of the County from any other party to the contract arising as the result of the contract. In the event the Agreement is terminated, with or without cause, HENSLEY shall deliver all finished or unfinished program documents, data, and reports prepared as a result of this Agreement to the County. Page 3 of 7 18. Indemnification: 18.1 HENSLEY agrees to defend, indemnify, and hold harmless the County (as "Indemnitee") from and against any and all claims, losses, liability, costs, or expenses (including reasonable attorney's fees) (hereinafter collectively referred to as "Claims") involving bodily injury of any person (including death) or property damage, arising out of or related to this Agreement, caused by the act, omission, negligence, misconduct, or other fault of the Indemnitor, its officers, officials, agents, employees, or volunteers. DIESEL EMISSIONS REDUCTION ACT STATE CLEAN DIESEL GRANT PROGRAM OVERVIEW Administration Maricopa County Air Quality Department (MCAQD) will administer the Diesel Emissions Reduction Act (DERA) State Clean Diesel Grant Program in Maricopa County under authorization from the State of Arizona and the EPA. HENSLEY will limit administrative costs to the program by using existent funds and staff. Costs to the DERA fund will be limited to HENSLEY administrative costs if approved in the application, and equipment reimbursable costs. DERA will pay the current percentages for the specified technology written in the approved work plan, and HENSLEY will be responsible for the cost share amount. DERA Eligible Activities DERA Funding Limits Minimum Mandatory (DERA Funds + Voluntary | Cost-Share (Fleet Owner Match) Contribution) Exhaust Control Retrofit 100% 0% Engine Upgrade / 40% 60% Remanufacture Highway Idle Reduction 25% 715% Locomotive Idle Reduction 40% 60% Marine Shore Power 25% 75% Electrified Parking Space 30% 70% Engine Replacement— Diesel 40% 60% or Alternative Fuel Engine Replacement- Low 50% 50% NOx Engine Replacement- All- 60% 40% Electric Vehicle/Equipment 25% 75% Replacement Diesel or Alternative Fuel Vehicle/Equipment 35% 65% Replacement — Low NOx Vehicle/Equipment 45% 55% Replacement — All-Electric Budget and Period of Performance Page 4 of 7 bo Written approval by MCAQD is required prior to any changes to the sub award budget. Failure to obtain prior written authorization may result in suspension of the sub award or unallowability of costs. Sub award monies are to be used only during the period of the agreement effective date through September 30, 2025. Any deviation from this schedule must have prior approval from MCAQD. A request for extension may be considered but will require prior approval by MCAQD and the EPA a minimum of sixty days before the scheduled end date of the award. Disbursements Payment of sub award monies is to be made once evidence of retrofit completion or new vehicle invoice and documentation of proper destruction of replaced vehicle is submitted to MCAQD. Use of subaward monies is subject to compliance with these conditions of the subaward and satisfactory project performance. MCAQD reserves the right to terminate any project that, in MCAQD’s sole discretion, is not satisfactorily pursuing and fulfilling stated project goals and objectives. MCAQD shal! reimburse HENSLEY for cancellable obligations properly incurred prior to termination notice. Destruction Requirements The vehicle/equipment being replaced will be scrapped or rendered permanently disabled within 90 days of the replacement or remanufactured to a certified cleaner current emission standard. Permanently disabling the chassis and disabling or remanufacturing the engine while retaining possession of the vehicle/equipment is an acceptable scrapping method. Disabling the chassis may be completed by cutting through the frame/frame rails on each side at a point located between the front and rear axles. Other acceptable scrappage methods may be considered and will require written approval from MCAQD Grant Programs Administrator. Vehicle/Equipment components that are not part of the engine or chassis may be salvaged from the unit being replaced. If scrapped or remanufactured vehicles/equipment or salvaged vehicle/equipment chassis or components are to be sold, this program income will need to be addressed in the submitted budget. SCOPE OF WORK The HENSLEY, under the authorization of Maricopa County in accordance with 42 U.S.C. 16133, shall administer the Diesel Emissions Reduction Act (DERA) State Clean Diesel Grant Program. The County shall provide the following services: 1.1 Maricopa County will review and pay program invoices submitted by HENSLEY. 1.2 Maricopa County will verify emissions reductions from the vehicles retrofitted or replaced. Maricopa County will collect data from the HENSLEY and submit quarterly reports as required by the EPA. On December 30, 2026, the County shall prepare and submit a final report to the EPA that contains at least the following information: The number of vehicles retrofitted or replaced by model year. The quantity and nature of vehicle emissions reduced. The cost-effectiveness of the DERA in terms of dollars spent per ton of vehicle emission reductions, Any recommendations for improving the effectiveness of the DERA. The administrative costs of the DERA. epee HENSLEY, shall provide the following services: 2.1 Follow all program requirements as detailed in the FY 2023-2024 Diesel Emissions Reduction Act (DERA) State Grants Program Guide as published by the EPA - Office of Transportation and Air Quality, July 2023. 2.2 Determine and verify eligibility of retrofit components and/or vehicles for DERA. 2.3 Adhere to the project work plan noted below as approved by the EPA and the MCAQD. 2.4 Per its written procurement policy, obtain and review bids to purchase DERA-eligible qualified replacement vehicles while adhering to Federal program requirements. 2.5 Follow all Federal grant requirements including 2 CFR §200.318 General Procurement Standards through §200.326. 2.6 Establish and follow written policies required by the 2 CFR 200, including, but not limited to: a. Suspension and Debarment (per 2 CFR §200.214) b. Financial Management (per 2 CFR §200.302) Page 5 of 7 Allowability of Costs (per 2 CFR §200.302(b)(7) and Subpart E-Cost Principles) Internal Controls (per 2 CFR §200.303) Conflict of Interest (per 2 CFR §200.318(c) (1-2) General Procurement Standards (per 2 CFR §200.318 through 200.326) mean 2.7 Upon agreement effective date, order, receive and document replacement vehicles. 2.8 Submit quarterly reports and vehicle data as requested by the County. 2.9 Invoice Maricopa County for program costs associated with implementing the DERA per program reimbursement and support documentation requirements. 2.10 Submit evidence of appropriate disposal (digital photos including the engine tag showing the serial number, engine family number, and engine model year and of the destroyed engine block and cut frame rails or other structural components) as required by program guidelines. Submit photos of newly purchased replacement vehicles. APPROVED WORK PLAN Subaward #1 Vehicles Cost Per DERA Cost Share Vehicle Hensley 2002 Class 8 $313,500 $141,075 $172,425 Beverage delivery truck All electric 2002 Class 8 $313,500 $141,075 $172,425 delivery truck : 2003 Class 8 $313,500 $141,075 $172,425 delivery truck Subtotal 3 Vehicles $940,500 $423,225 $517,275 APPROVED VEHICLES "Vehicle Identification | FUJBGCV94HM09421 IFUBBUBSX2DK26124 1FUBBUBS92DK26129 Number(s): Vehicle Make: Freightliner Freightliner Freightliner Engine Serial Number(s): A 460 584 00 47 3926849 __ 2CEX05050A0 Engine Make: Mercedes-Benz Cummings ____ Cummings Engine Model: OM 459 Cummings Cummings Engine Model Year: 2003 2002 2002 Page 6 of 7 IN WITNESS WHEREOF, the parties have executed this “Agreement” as of the date set forth above; MARICOPA COUNTY: Jack Sellers, Chairman Date Maricopa County Board of Supervisors Altest by: Juanita Garza, Clerk of the Board Date Maricopa County HENSLEY BEVERAGE COMPANY: Pi cotn ea seasee te , Oicrlevot Freer afecsvi\ses First name Last name (printed), Title . Wh TBefa4 Signatur AN) Date Hensley Beverage Company (HENSLEY) Approved as to Form: In accordance with A.R.S. §§ 11-201, 11-251, 11-951 and 11-952, the foregoing Agreement has been reviewed by the undersigned attorneys who have determined that said Agreement is in proper form and is within the powers and authority granted to the public body represented by their respective attorneys. LZ 8/5/2024 Max G. Carpinelli, Deputy County Attorney Date Maricopa County N/A N/A First name Last name (printed), Legal Counsel Date Hensley Beverage Company (HENSLEY) Page 7 of 7