TERP-ish Grant Round Opens

The North Central Texas Council of Governments and TCEQ are funding a $5 million grant round for North Texas only. It is VERY similar to the TERP setup and is called the Heavy-Duty Vehicle and Equipment Grant Program.

Eligible counties include: Dallas, Tarrant, Denton, Collin, Rockwall, Parker, Kaufman, Johnson and Ellis.

Public and private entities can apply. They are using what they call a "modified first-come, first-serve" format. We've seen this one other time in North Texas and what it means is that instead of waiting for a single deadline months from now when everybody will submit their applications all at once the state will accept them each Friday.

In other words, get your act together and get in line.

The previous occurence I mentioned allowed people to sell their old machine out of the state, but that is not the case this time. You have to scrap it, but the maximum cost per ton has been raised to $10,000 like the ERIG program.

So, while this is not a TERP grant in the strictest of terms it is about as close as you can get. The main difference is that the funding does not come from the diesel tax, but from the ARRA stimulus money.

All purchases must be complete by April 30th of next year. Since the round is currently underway any machine purchased now is eligible assuming it meets the normal criteria.

Scrapping Your Old Machine

The whole point of the TERP grant system (from the state’s perspective) is scrapping the old, dirtier unit. There was a time you could sell your old piece of heavy equipment outside Texas if the new owner agreed it would never return, but those days are long gone. Scrapping is now your only option.

Your 5- or 7-year contracted term does not begin until the TCEQ receives, processes and approves your disposition paperwork and supporting photographs. For some that may not seem like a big deal, but if you put a lot of wear on your construction equipment this is worth knowing.

Let’s say you purchased a new wheel loader the day the TERP round opened in December of last year – the first eligible day to buy – and then received your approval call in June. You already have 6 months of wear. If you wait a month or two to file your request for reimbursement and then another to officially scrap the old piece you are in the ballpark of 9 months of wear on that new loader before the term of your contract starts.

If you keep machines 10+ years or they work light duty then this isn’t such a big deal. If you expect to replace your new TERP-funded equipment as soon as your commitment ends it’s something to be aware of.

This document gives an overview of how to scrap. Page 7 has the answers to some common questions and you’ll see some photo examples after that.

Here is the disposition form you (or a consultant) will fill out and submit. It’s more or less self-explanatory, but don’t be shy about asking questions since they have to approve your disposition before starting your term.

A few customers have told me they used companies experienced in TERP scrapping to handle that part which would let you take care of disposition and selling the old iron in one step. Other customers held on to their old unit and parted it out for similar machines still running.

There's something to be said for holding on to a machine until you get the TCEQ's approval of your scrapping efforts.

Just remember you have to drill a 3-inch hole in the engine block and it cannot be through a replaceable plate. You also have to cut at least 75% of the frame in a V-cut. The closer to the cab, the better.

Don’t forget before and after pictures that include the engine plate proving that you are destroying the correct machine.

Can Local Governments Apply For TERP Grants?

Cities and counties are eligible and it would be easy to speculate that the state would like to see them taking advantage of these funds. Grant money would help municipalities stretch their budgets further and get them on board with the emission reduction stance held both in Austin and in Washington.

That having been said most of the applications we’ve helped complete have been for businesses.

One reason is that government owners usually don’t run their units for as many annual hours which directly affects the size of an ERIG grant.

If you purchase equipment at the municipal level don’t rule out the Rebate Grant program. It doesn’t punish lower hour owners and has other benefits like a faster turnaround time on the approval process.