Attachment 4 LTWWP - Performance Incentive Plan.pdf

FOR OFFICIAL USE ONLY

Source Selection Information – See FAR 2.101 and 3.104

Source Selection Plan - FA302024Q0022

Attachment 4

Lake Texoma Water and Wastewater Plant Operations and Maintenance Services

Performance Incentive Plan

This Performance Incentive Plan (PIP) is comprised of two one-year Incentive Option Periods

(IOPs). This plan details the IOP process and explains how the incentive is applied.

Incentive Option Periods

1.0. Definitions

1.1. “Incentive Option Period (IOP),” refers to a period of performance established under this competitively awarded contract in which the Service Provider (SP) may be awarded an option in the future based on a contingency. In this case, the contingency is defined as the SP maintaining a valid Class C license in groundwater and in wastewater treatment as prescribed by the State of

Texas without major violations of compliance with the state’s environmental regulations at the effective Determination Point.

1.2. “Determination Point (DP),” refers to the scheduled point in time when the Administrative

Contracting Officer (ACO) makes a unilateral decision as to whether the SP has become eligible or ineligible for an opportunity to perform a future IOP. An affirmative determination does not automatically entitle the SP to perform during a particular IOP, but rather affords the SP an opportunity to perform during a particular IOP contingent upon the ACO determining the requirements of FAR Part 17.202 – Use of Options are met and exercising the IOP IAW FAR

52.217-9, Option to Extend the Term of the Contract.

1.3. “Eligible,” refers to the ACO’s affirmative decision that the SP has met the required criteria, (i.e maintaining a valid Class C license in groundwater and in wastewater treatment as prescribed by the State of Texas without major violations of compliance with the state’s environmental regulations) which in turn, supports the ACO’s decision to exercise either Option 5 (IOP1) or

Option 6 (IOP2).

2.0. Introduction

2.1. The objective of this incentive approach is to motivate maintaining a valid Class C license in groundwater and in wastewater treatment as prescribed by the State of Texas without major violations of compliance with the state’s environmental regulations. For this reason, the DP for

IOP1 eligibility relates directly to initial performance quality (the base period of performance).

Subsequent IOP DPs consider performance occurring after the first option period.

3.0. IOP Parameters

3.1. The SP becomes eligible or ineligible for IOPs based on maintaining a valid Class C license in groundwater and in wastewater treatment as prescribed by the State of Texas without major violations of compliance with the state’s environmental regulations. Failure to meet this criteria may result in the loss of eligibility for the IOPs.

3.2. All IOPs will be executed in accordance with FAR 52.217-9, Option to Extend the Term of the Contract, as the unilateral right of the Government. As such, it should be understood that becoming “eligible” for IOPs does not guarantee future performance of 5th or 6th Option

Periods. In addition to maintaining a valid Class C license in groundwater and in wastewater treatment as prescribed by the State of Texas without major violations of compliance with the state’s environmental regulations, the IOPs remain contingent upon the Government’s unilateral right to exercise the four option periods consistent with the requirements of FAR Part 17.207 –

Exercise of Options.

3.3. Within 60 days of exercising IOPs, at the applicable DP described in Section 2.3. below, the

ACO will determine whether the SP is eligible or ineligible for a particular IOP. The ACO will notify the SP as soon as practicable upon making the determination.

4.0. IOP Implementation

4.1. This section illustrates the DPs and IOP eligibility process. There are up to two possible

DPs (DP #1 and DP #2) and each is described below. Each DP makes reference to “IOP1”, and/or “IOP2”. IOP1 refers to the 5th Option Period, and IOP2 refers to the 6th Option Period.

To merit an opportunity to become eligible for IOP2, the SP must be eligible for IOP1 first. The below figure is a visual chart depicting the IOP DPs and IOP eligibility process:

***Note: The contract durations depicted in this chart indicates maximum periods of performance if ALL options are exercised IAW FAR 52.217-9.

4.2. DP #1.

4.2.1. Eligible. The SP has achieved maintaining a valid Class C license in groundwater and in wastewater treatment as prescribed by the State of Texas without major violations of compliance with the state’s environmental regulations during the Base period of performance. The SP becomes eligible for IOP1, therefore, the possible contract duration becomes six years. Although eligible for IOP1, this option may or may not be exercised by the ACO in accordance with FAR

52.217-9. The Government will continue to review that the SP has maintained a valid Class C license in groundwater and in wastewater treatment as prescribed by the State of Texas without major violations of compliance with the state’s environmental regulations beyond the Base

Period before exercising IOP1 and IOP2. If the SP becomes eligible for IOP1 at this determination point, the SP establishes an opportunity to become eligible for IOP2 at DP #2.

4.2.2. Ineligible. The SP did not achieve maintaining a valid Class C license in groundwater and in wastewater treatment as prescribed by the State of Texas without major violations of compliance with the state’s environmental regulations during the Base period of performance.

Since the SP must be eligible for IOP1 to merit an opportunity to become eligible for IOP2, the

SP becomes ineligible for IOP2. However, the SP will be afforded an opportunity to become eligible for IOP1 at DP #2.

4.3. DP #2.

4.4.1. Eligible. The SP has achieved maintaining a valid Class C license in groundwater and in wastewater treatment as prescribed by the State of Texas without major violations of compliance with the state’s environmental regulations during the Base Period and Option 1 period. If at decision point #1, the SP was eligible for the 1st incentive option; then the SP now becomes eligible for the 2nd incentive option and the possible contract duration becomes seven years.

Although eligible, this option may or may not be exercised by the ACO in accordance with FAR

52.217-9. The Government will continue to review that the SP has maintained a valid Class C license in groundwater and in wastewater treatment as prescribed by the State of Texas without major violations of compliance with the state’s environmental regulations.

4.4.2. Eligible at DP#2 after being ineligible at DP#1. If the SP was determined ineligible at

DP#1 but achieved maintaining a valid Class C license in groundwater and in wastewater treatment as prescribed by the State of Texas without major violations of compliance with the state’s environmental regulations during the Option 1 period, the SP becomes eligible for IOP1, therefore, the possible contract duration becomes six years. Although eligible for IOP1, this option may or may not be exercised by the ACO in accordance with FAR 52.217-9. The

Government will continue to review that the SP has maintained a valid Class C license in groundwater and in wastewater treatment as prescribed by the State of Texas without major violations of compliance with the state’s environmental regulations beyond Option 1 before exercising IOP1. The SP did not achieve maintaining a valid Class C license in groundwater and in wastewater treatment as prescribed by the State of Texas without major violations of compliance with the state’s environmental regulations during the Option 1 period. The SP becomes ineligible for both IOPs, therefore, the possible contract duration becomes five years.

4.3.2. Ineligible at DP#2 after being ineligible at DP#1. The SP did not achieve maintaining a valid Class C license in groundwater and in wastewater treatment as prescribed by the State of

Texas without major violations of compliance with the state’s environmental regulations during the Option 1. The SP becomes ineligible for incentive options. The contract duration remains five years.