Okaloosa County BOCC — September 1, 2015 — past Agenda Request from 07.01.2014

BOARD OF COUNTY COMMISSIONERS AGENDA REQUEST DATE: July 1, 2014 TO: Honorable Chairman and Members of the Board FROM: Jeff Littrell SUBJECT: Eglin AFB Utilities Privatization - Update & Authorize Staff to Negotiate DEPARTMENT: Water and Sewer BCC DISTRICT: All STATEMENT OF ISSUE: OCWS is providing an update on Eglin AFB Ultilities Privatization (UP) and requesting that the BCC authorize staff to negotiate the proposal/contract, which may result in OCWS bringing a final proposal and contract to the BCC in the future for approval and execution. Eglin UP is for the potable water distribution system and the wastewater collection system. Please note that Eglin UP does not include wastewater treatment & disposal - OCWS has a separate contract for the treatment & disposal of wastewater from Duke Field, Eglin Main Base, and Camp Rudder. BACKGROUND: For an overview of Eglin UP and Defense Logistic Agency's (DLA) Request for Proposal (RFP), see the attached BCC Agenda Request from 2/5/2013 and the accompanying PowerPoint slides. Per the 2/5/2013 BCC Meeting, the County submitted a proposal to DLA in March 2013. The proposal on the 50-year contract is approximately $14M/year (2014 dollars) for the ownership, operations, maintenance, capital projects (engineering, construction, etc.), management, and financing of UP. Since the submission of the proposal, the following events have occurred: - Defense Contract Audit Agency (DCAA) conducted an audit on OCWS in April 2013. - Defense Contract Management Agency (DCMA) conducted an audit on OCWS in July 2013. - DLA extended the Period of Validity on 1/17/2014 to 4/29/2014. - OCWS conducted a "UP Workshop" on 4/3/2014 with the County's UP Team - see attached agenda for attendees and discussion topics. - DLA extended the Period of Validity on 4/25/2014 to 10/31/2014. - DLA issued RFP Amendment 9 on 6/4/2014. This amendment revises some of the terms, conditions, and infrastructure inventory. - DLA issued three (3) Negotiation Messages on 6/4/2014 pertaining to: water only proposal, wastewater only proposal, water/wastewater combined proposal. In this correspondence, DLA notified Okaloosa County that "negotiations are hereby opened and are expected to last through October 1, 2014". ' At this time, DLA has not yet asked for a revised price/proposal, but they plan on going back and forth with negotiations between now and 10/1/2014. Some negotiations will be in writing while others will be face to face or by phone. In responding to DLA, it will be a fully coordinated effort. Responses will be drafted and closely coordinated with the following UP Team: County Administrator, the County legal team, OCWS senior leadership, Constantine Engineering (under contract for program manager/engineering), Environmental Services Group (under contract for contract operations), Burton & Associates (OCWS rate consultant), First Southwest Company (County Financial Advisor), and other County departments & constitutional offices - Purchasing, HR, Risk Management, Finance, and Contracts & Grants. Because of the expected substantial amount of back and forth effort, and knowing that time will be of the essence with each response, staff are requesting BCC authorization for staff to respond to DLA's requests and to negotiate the proposal. The current version of the terms and conditions of the contract are already established in DLA's RFP, as amended. Those terms and conditions will be revised per the exceptions we took in the County's proposal and per the negotiation process. The final proposal and contract will come back to the BCC in the future for approval and authorization for the Chairman to execute it. Throughout negotiations, OCWS staff will stay in close coordination with the other members of the UP Team as listed above. OPTIONS: Approve or deny. RECOMMENDATIONS: Staff recommends that the BCC authorize staff to negotiate the proposal/contract. Pending negotiations and the Federal Government's timetable, OC