MTH RFP Sep 2010.doc

Mountain Home AFB, ID

Air Force Utilities Privatization Mountain Home AFB, ID

Air Force Utilities Privatization

United States Air Force Utilities Privatization

Request for Proposal (RFP)

GS–00P-11-BSC-0806

[OCTOBER 7, 2010]

Table of Contents Solicitation/contract iUnited States Air Force iUtilities Privatization i[DATE] Table of Contents iiTable of Contents

7Supplies or Services and Prices/Costs

7B.1 Authority

7B.2 Scope and Purpose

7B.2.1 General

7B.2.2 Program Goal

8B.2.3 Notices and Reservations

9B.2.4 Selection of a Contractor

9B.3 Systems to be Privatized

10B.4 Price Proposal

11B.4.1 Regulated Tariff Rate Proposal

12B.4.2 Fixed-Price Economic Price Adjustment Proposal

13B.5 Service Charges for Schedule B-1

13B.5.1 CLIN 0001: Applicable Tariff(s)

13B.5.2 CLIN 0001: Monthly Credit as Payment for Purchase Price

13B.5.3 CLIN 0002: Initial System Deficiency Corrections/Connection Charges

14B.5.4 CLIN 0003: Recoverable Portion of the Purchase Price

14B.5.5 CLIN 0004: Transition Period

14B.6 Service Charges for Schedules B-2: Fixed Price with Economic Price Adjustment

14B.6.1 CLIN 0001 – Utility Services Charge

14B.6.2 CLIN 0001: Monthly Credit as Payment for Purchase Price

16B.6.3 CLIN 0002: Initial System Deficiency Corrections / Connection Charges

17B.6.4 CLIN 0003: Recoverable Portion of the Purchase Price

17B.6.5 CLIN 0004: Transition Period

17B.6.6 Total Monthly Charges

17B.6.7. Economic Price Adjustment Alternate Index Methodology

17B.7 Price Schedule Data Sheets

17B.7.1 General

18B.7.2 Schedule 1 – Utility Services Charge

19B.7.3 Schedule 2 – Renewals and Replacements – 50 YEAR SCHEDULE

20B.7.4 Schedule 3 – Initial System Deficiency Correction(s) / Connection Charge(s)/Transition Period

20B.7.5 Schedule 4 –Recoverable Portion of Purchase Price

21B.7.6 Schedule 5 –Proposal 50 Year Charges to the Government, Constant 20XX$

22Description/Specifications/Work Statement

22C.1 Precedence

22C.2 Scope and Purpose

22C.2.1 General

22C.2.2 Program Goal

22C.2.3 Utility Systems

22C.2.4 Current Service Arrangement

23C.3 Requirement

23C.3.1 Utility Services Requirement

23C.3.2 Performance Standards

23C.3.3 Sub- Metering

24C.3.4 Energy and Water Efficiencies and Conservation

24C.3.5 Energy/Water Commodity Supply

24C.3.6 Wastewater Effluent Disposal

25C.4 Service Area

25C.4.1 Use of Distribution Systems to Serve Areas Outside the Installation Service Area

25C.4.2 Joint Use

26C.5 Utility System Ownership, Personnel, and Security

26C.5.1 Utility System Ownership

27C.5.2 Personnel

28C.5.3 Contractor Vehicles

28C.5.4 Contractor Radios

29C.5.5 Contractor Advertising

29C.6 Access to the Utility System

29C.6.1 General

29C.6.2 Right of Access

31C.7 Response to Service Interruptions/Contingencies and Catastrophes

32C.8 Repair Response Procedures

32C.8.1 Notification Procedures

32C.8.2 Emergency Service Requests

32C.8.3 Urgent Service Requests

33C.8.4 Routine Service Requests

33C.9 Coordination of Work

33C.9.1 Routine Work

33C.9.2 Routine, Urgent, and Emergency Service Requests

33C.9.3 Construction and Restoration of Site

34C.9.4 Working Hours

34C.9.5 Coordination Meetings

34C.9.6 Exercises and Crisis Situations Requiring Utility Support

34C.9.7 Government Operation

35C.9.8 Plant Control

35C.10 Environmental Compliance

35C.10.1 Permit Compliance

35C.10.2 Spill Contingencies

35C.10.3 Work in Environmentally Sensitive Areas

35C.10.4 Environmental Impact Assessments

35C.10.5 Hazardous Material and Waste Minimization

36C.10.6 Environmental Response

36C.10.7 Asbestos and Lead-based Paint

36C.10.8 Environmental Restoration Program

36C.11 SDCs/Upgrades/Connections and Renewals and Replacements

36C.11.1 Due Diligence Adjustment

37C.11.2 SDCs/Upgrades/Connections and Renewals and Replacements

38C.11.3 Connections and Disconnections

40C.12 Operations and Maintenance/Quality Management

40C.13 Transition Plan

41C.14 Historical, Architectural, & Landscaping Requirements

41C.15 Specialty Training

42Packaging and Marking

43Inspection and Acceptance

44Deliveries or Performance

44F.1 Contract Term

44F.2 Commencement of Service

44F.3 Clauses Incorporated by Reference

45Contract Administration Data

45G.1 DFARS 252.201-7000: Contracting Officer's Representative

45G.2 Submission and Payment of Invoices

45G.3 Utility Services Charge Adjustment

45The Utility Services Charge will be adjusted in accordance with Section B, Economic Price Adjustment – Price Index Utility Privatization. This paragraph applies to the Utility Services Charge portion of CLIN 0001 only, and does not apply to any other CLIN unless the Contract explicitly states otherwise. However, neither party shall request a change to the Utility Services Charge portion of CLIN 0001 to become effective sooner than 1 year from the contract start date. This paragraph does not apply to regulated utilities submitting a proposal using Schedule B-1.

45G.4 Accounting Procedures

46G.4.1 Price Adjustment for Noncompliance with Accounting Procedures

47Special Contract Provisions

47H.1 Mobilization and Other Contingencies

47H.2 Insurance Requirements

47H.2.1 Insurance Certificate

47H.2.2 Types of Insurance

48H.2.3 General

48H.2.4 Self-insurance

49H.3 Availability of Funds

49Nothing in this contract shall be construed to obligate funds in advance of appropriations.

49H.4 Liability

49H.5 Catastrophic Loss

49H.6 Notification of Infrastructure/Service Contract Transfer

50H.7 Government Repurchase Option

51H.8 Foreign Object Damage Prevention Program

51H.9 Hazardous Substances

51H.10 Interest Allowability of Capital Investment

51H.11 Contribution in Aid of Construction (CIAC) Tax Liability

52H.12 Differing Site Conditions

53Contract Clauses

53I.1 FAR 52.252-2 Clauses Incorporated by Reference (Feb 1998)

53I.2 FAR Clauses

57I.2.1 Disputes

57I.3 DFARS Clauses Incorporated by Reference

59I.4 Utility Services Clauses Incorporated by Reference

59I.5 Clauses Incorporated by Reference: Non-Regulated Utility

60I.6.1 FAR 52.222-42: Statement of Equivalent Rates for Federal Hires (May 1989)

61List of Attachments, Exhibits & References

62Representations, Certifications, and other Statements of Offerors

70Instructions, Conditions, and Notices to Offerors

70L.1 FAR 52.252-1: Solicitation Provisions Incorporated by Reference (In Accordance With FAR 52.107[a])

71L.2 Information to Offerors

71L.2.1 General Information

73L.2.2 Number of Awards

73L.2.3 Protests

73L.3 Proposal Preparation Instructions – General

73L.3.1 Proposal Organization/Page Limits

73L.3.2 Proposal Format

74L.3.3 Distribution

74L.3.4 Electronic Media

74L.3.5 Pages and Typing

75L.3.6 Cost or Pricing Information

75L.3.7 Proposal Structure

75L.3.8 Cross-Reference Matrix

75L.3.9 Glossary of Abbreviations and Acronyms

75L.3.10 Documents Incorporated by Reference

75L.3.11 Proposal Revisions

76L.4 Proposal Preparation Instructions – Volume I: Technical Proposal

76L.4.1 Subfactor 1: Service Interruption/Contingency and Catastrophic Loss Plan

77L.4.2 Subfactor 2: Operations and Maintenance/Quality Management Plan

79L.4.3 Subfactor 3: Initial System Deficiency Corrections and Initial Renewals and Replacements Plan

80L.4.4 Subfactor 4: Operational Transition Plan

82L. 5 Proposal Preparation Instructions – Volume II: Past Performance

84L.6 Proposal Preparation Instructions – Volume III - Contract Documentation

84L.6.1 Standard Form (SF) 33 & Representations and Certifications

84L.6.2 Alternate Proposals and Exceptions to Terms and Conditions

864. If a regulated entity, exclude costs typically consider to be unallowable by the cognizant State regulatory body.

86L.6.3 Other Required Information

87L.7 Proposal Preparation Instructions – Volume IV: Price Proposal

87L.7.1 Submission of Certified Cost or Pricing Data

87L.7.2 General

88L.7.3 Accounting Systems

88L.7.4 Organization

88L.7.5 Detailed Instructions for Price Proposal

91Evaluation Factors for Award

91M.1 Basis for Contract Award

91M.2 Evaluation Factors and Subfactors

93M.2.1 Order of Importance for Evaluating Factors and Subfactors:

93M.3 Comparison of Offered Prices with the Government Should-Cost Estimate

Section B

Supplies or Services and Prices/Costs

B.1 Authority

Utilities privatization consists of two transactions: (1) the conveyance of the utility infrastructure via a Bill of Sale; and (2) the acquisition of utility services on the privatized system(s) via a utility services contract. The conveyance of the utility system is authorized by and conducted under 10 U.S.C §2688. The sale of the utility system is not an acquisition and therefore is not subject to the FAR and its supplements. A copy of 10 U.S.C. § 2688 is provided as Attachment J45 to this Request for Proposals (RFP). The purchase of utility services is an acquisition and will be governed by the FAR and its applicable supplements.

B.2 Scope and Purpose

B.2.1 General

B.2.1.1 SCOPE: The Government seeks a Contractor to assume ownership of the utility system(s) and infrastructure specified in Section B.3, Systems to be Privatized, (the “system(s)” or “utility system(s)”), and as the new owner, to operate and maintain the systems and provide utility services to the Government. The Contractor (a.k.a. “System Owner”) shall furnish all necessary labor, management, supervision, permits, equipment, supplies, materials, transportation, and any other incidental items or services required for the complete ownership of and provision of utility services via these utility systems, including operation, maintenance, repair, upgrade, and improvement of the systems. Assumption of ownership and provision of utility services shall be performed in accordance with all terms, conditions, and special contract requirements, specifications, attachments, and drawings contained in this solicitation or incorporated by reference.

Offerors are not required to offer on all of the utility systems specified in B.3 unless otherwise specified in the Section J Attachments. Offers may be submitted on individual system(s) or on groups of systems on an all or none basis. However, for Water and Wastewater systems, the Government reserves the right to consider any efficiencies and/or cost savings that may be achieved by awarding both systems to a single Offeror. For all offers, whether grouped or not, the Offeror shall provide a separate price schedule for each contract line item. Offers on grouped systems that do not include a separate price schedule for each line item will not be considered for award. For purposes of the economic comparison required by 10 U.S.C. §2688, each system will be analyzed separately. Offerors are advised that if any individual system within a grouped offer does not satisfy the economic criteria for award that grouped offer will not be considered for award.

B.2.1.2 DURATION: The period of performance is anticipated to be 50 years from the contract start date, provided that the Government finds that a 50 year period is cost effective pursuant to 10 U.S.C. §2688(d)(2).

B.2.1.3 TYPE OF CONTRACT: The Government contemplates award of either a Regulated Tariff or Fixed-Price with Economic Price Adjustment contract resulting from this solicitation.

(FAR 52.216-1)

B.2.2 Program Goal The desired goal of this transaction is to transfer all right, title, and interest of the United States in and to the utility systems. Consequently, the United States will retain no reversionary interests in the utility system sold, other than the terms regarding the repurchase option and rights of access. The sale will be documented by a Bill of Sale, see sample at Attachment JR1 to this RFP. The utility system being sold includes all equipment, fixtures, structures, and other improvements utilized in connection with the utility system, which will be more specifically described in the Bill of Sale. The divestiture will not include the real property upon, under, or around the utility system. The utility system being sold is as identified in the Bill of Sale and does not include any other property. In addition to the sale of the utility system identified in the Bill of Sale, the Government will also acquire utility services from the transferee.

Acquisition of utility services will be conducted in accordance with the FAR and its applicable supplements and as set forth in this RFP. Regardless of the length of the utility services contract, the sale of the utility system is in perpetuity.

B.2.3 Notices and Reservations

B.2.3.1 The Government will only acquire utility services if it sells the utility systems. It can only sell the utility systems if it determines that (1) the long-term economic benefit to the United States of the conveyance exceeds the long-term economic cost to the United States of the conveyance, and (2) the conveyance will reduce the long-term costs of the United States for utility services provided by the utility system concerned. Award, if at all, will only be made by the duly authorized execution of the utility services contract and this contract will be contingent upon the actual conveyance of the system. If for any reason conveyance does not occur, the Government’s termination liability will be limited to transition costs.

B.2.3.2 The sale of the utility systems is not governed by the FAR, the Federal Property and Administrative Services Act of 1949, or any of their implementing regulations. The Government may choose to adopt and adapt for use in the sale the processes and methods typically utilized in those laws and regulations but, by doing so, is not thereby subjecting the sale to those laws and regulations. The purchase of utility services is an acquisition and will be governed by the FAR and its applicable supplements.

B.2.3.3 The Government reserves the right to make no award to any Offeror. If it does make award, the Government does not guarantee renewal of the utility services contract at the end of the contract period.

B.2.3.4 The property being sold in this action will be as described in the Section J utility specific attachments of the solicitation. The system will be sold in an “as is, where is” condition without any warranties, representations, or obligation on the part of the Government to make any alterations, repairs, or improvements. Any proposal that offers an alternative description of the property being sold may be deemed technically unacceptable.

B.2.3.5 OFFERORS REQUESTING INFORMATION REGARDING THIS SOLICITATION SHALL CONTACT THE CONTRACTING OFFICER ONLY. CONTACTS TO OTHER GOVERNMENT PERSONNEL OR NON-GOVERNMENT ADVISORS ARE PROHIBITED. The Contracting Officer or his/her designated representatives are the only persons authorized to contact Offerors, and the Contracting Officer is the only person authorized to release information regarding an ongoing Source Selection. Refer questions or communications concerning this solicitation directly to the contracting personnel identified in Blocks 7 and 8 of SF 33. Include the Contracting Officer on all such communications. (E-mail is the preferred method.)

B.2.3.6 Facsimile offers will not be accepted. The Government encourages alternative proposals that add value when compared with the requirements in the RFP. Please refer to Section L, Alternate Proposals and Exceptions to Terms and Conditions, for more information.

B.2.3.7 Copies of the solicitation are available on the Federal Business Opportunities web site at www.fbo.gov . Maps and other technical data will be made available to Offerors in the Technical Library.

B.2.3.8 Offerors are required to submit Technical Proposal, Price Proposal, Past Performance, and Contract Documentation as outlined in Section L of the solicitation. Offerors are also required to submit a fully completed SF 33. Offerors must acknowledge receipt and acceptance of all amendments to the solicitation. This may be done by both signing and returning the amendment immediately after issuance, or by written acknowledgment of receipt and acceptance as part of the proposal submission package. In accordance with Section L, any exceptions and assumptions must be stated with specificity and separately matrixed.

B.2.3.9 PRE-PROPOSAL CONFERENCE: A pre-proposal conference will be held on or about October 26, 2010. Offerors must register for this conference by contacting Linda Collins at (202) 708-9881, email address lindal.collins@gsa.gov.

In order to make the conference as productive as possible, Offerors are requested to submit any questions in writing (electronic mail is preferred) at least five working days in advance of the conference to:

Linda L. Collins

Director, Natural Gas Acquisition Program (NGAP)

GSA, Energy Division (PMAA) Office of Facilities Management & Services Programs

7th & D Street, SW, Room 4004

Washington, DC 20407

E-mail: lindal.collins@gsa.gov

Phone: (202) 708-9881

Fax: (202) 205-5049 B.2.4 Selection of a Contractor

Selection of a Contractor/System Owner (Contractor) will be based on a best value determination consistent with the evaluation factors described in Section M, Evaluation Factors for Award. Pursuant to the provisions of Section L, Information to Offerors, and FAR 52.215-1, the Government may evaluate and award without discussions. However, the Government reserves the right to conduct discussions if determined necessary. Therefore, Offerors are encouraged to submit their best offer as their initial offer.

B.3 Systems to be Privatized

The utility systems shown in Schedule A represent the utility systems included in this solicitation for privatization:

Schedule A

Utility System

B.4 Price Proposal

Offerors must complete Price Schedules and accompanying Price Schedule Data Sheets that are consistent within the pricing methodology they propose:

(If separately identified in tariff)

Schedules 3, 4, and 5

B.4.1 Regulated Tariff Rate Proposal Available to Offerors proposing regulated rates. Offerors are encouraged to provide service in accordance with their standard methods of service and standard service practices. It is acceptable for regulated utilities to submit an offer subject to regulatory approval, provided a proposed timeframe for approval is provided.

SCHEDULE B-1 regulated tariff a Payment by the Government for Utility Services

Mountain Home AFB, Idaho

Utility Systema: ___________________

CLINs

Monthly Credit as Payment for Purchase Price (see B.5.2).

$______________ Monthly Credit

______________ # months

_______________ Interest Rate

TOTAL FOR CLIN 0001

(See B.5.3 and B.7.4 (Schedule 3). This amount should not be included in the price offered for CLIN 0001.)

$ Varies – See Schedule 3

(See B.5.4 and B.7.5 (Schedule 4). This amount should not be included in the price offered for CLIN 0001.)

$ Varies –

See Schedule 4

(See B.5.5 and B.7.4 (Schedule 3). This amount should not be included in the price offered for CLIN 0001.)

See Schedule 3 a Utility system to be filled in by the Offeror. A B-1 must be completed for each utility system offered. Utility systems are shown in Schedule A paragraph B.3, Systems to be Privatized. Offerors shall provide a comprehensive description of proposed tariffs in their Price Proposals. See B.5.1.

b CLINs 0002 and 0003 are required only if the tariff provides for separate identification of initial system deficiency corrections, connection charges, and the recoverable portion of the purchase price. If separate identification is not provided, it will be assumed the tariff rate includes these costs.

NOTE:

The Purchase Price, Recoverable Portion of the Purchase Price, interest rate and amortization period are proposed by the Offeror.

B.4.2 Fixed-Price Economic Price Adjustment Proposal

SCHEDULE B-2

Payment by the Government for Utility Services

Mountain Home AFB, Idaho

Utility Systema: ____________________

CLINS

The Contractor shall provide utility services in accordance with Section C, Descriptions, Specifications, and Work Statement.b

Monthly Credit as Payment for Purchase Price. (see B.6.2)

$______________ Monthly Credit

_______________ # of months

_______________ Interest Rate

TOTAL FOR CLIN 0001:

(See B.6.3 and B.7.4 (Schedule 3). This amount should not be included in the price offered for CLIN 0001.)

$ Varies –

See Schedule 3

(See B.6.4 and B.7.5 (Schedule 4). This amount should not be included in the price offered for CLIN 0001.)

$ Varies – See Schedule 4

(See B.6.5 and B.7.4 (Schedule 3). This amount should not be included in the price offered for CLIN 0001.)

See Schedule 3 a Utility system to be filled in by the Offeror. A B-2 must be completed for each utility system offered. Utility systems are shown in Schedule A paragraph B.3, Systems to be Privatized.

b The Offeror should enter the Utility Services Charge, as computed in Schedule 1 (see B.7.2). See B.6, Economic Price Adjustment Price Index Utility Privatization.

NOTE:

The Purchase Price, Recoverable Portion of the Purchase Price, interest rate and amortization period are proposed by the Offeror.

B.5 Service Charges for Schedule B-1 B.5.1 CLIN 0001: Applicable Tariff(s)

Offerors proposing tariff rate offers shall include a comprehensive description of the tariff in their price proposal. The Offeror shall propose a tariff rate or rates no less favorable than that offered to similarly situated utility customers. The Offeror shall provide an explanation of the tariff, identify the buildings to which it applies, and identify any assumptions regarding service quantity and quality. The Offeror shall also describe the regulatory process, if any, which will govern future rate changes. The total monthly price will be the Applicable Tariff(s) less the Monthly Credit as Payment for Purchase Price, as defined in the following paragraph.

B.5.2 CLIN 0001: Monthly Credit as Payment for Purchase Price

The monthly credit is the monthly portion of the purchase price that will be credited to the Government over the number of months proposed by the Offeror. The purchase price is the product of the monthly credit (without interest) multiplied by the number of months the Government will receive the credit (CLIN 0001). The credit will be applied to the applicable tariff, as defined in CLIN 0001.

B.5.3 CLIN 0002: Initial System Deficiency Corrections/Connection Charges

Initial System Deficiency Corrections (ISDC)/Connection Charges are all nonrecurring costs to be paid by the Government to the Contractor. These nonrecurring costs include costs required to bring the system up to industry/regulatory standards and costs for new connections/disconnections to be accomplished during the transition period. See footnote (b) on Schedule B-1.

The following applies if ISDCs/connection charges are priced separately from the tariff rate. The requirement to perform an ISDC/Connection may originate from either a Government identified requirement, in which case the project will be listed in the relevant Utility Specific Attachment in Section J of this solicitation, or as a result of the Offeror’s determination that the ISDC/Connection is necessary to meet legally applicable regulatory requirements, or to achieve the standards typically maintained by the Offeror on its utility systems. The Offeror must provide rationale to support any projects the Offeror proposes.

The Offeror shall provide price information for ISDCs/Connections. Information to support the price proposed for ISDCs/Connections shall include project name, the interest rate, total ISDC project cost, the first full month project will be put into service, the amortization period, and the monthly charge associated with each ISDC/connection. This information shall be provided in Schedule 3 (See B.7.4).

If not encompassed in a tariff rate, the price of each ISDC proposed by the Offeror in Schedule 3 of the Price Proposal will be added to the Utility Services Charge, for the number of months indicated, when the ISDC is put in useful service.

The price for each ISDC/Connection is fixed. The price for each ISDC/Connection will be amortized over the term proposed by the Offeror in the Price Proposal. With every monthly invoice that includes a request for payment for an Initial System Deficiency Correction identified in Schedule 3, the Contractor shall submit an amortization schedule. The amortization schedule shall specify for each ISDC the principal and interest components of each monthly payment the number of the payment (of the total payments required), and the remaining principal balance.

B.5.4 CLIN 0003: Recoverable Portion of the Purchase Price

See footnote (b) on Schedule B-1. The recoverable portion of the utility system purchase price will be listed in Schedule 4 (See B.7.5) for the relevant utility system. The recoverable portion of the utility system purchase price will be added to the Utility Services Charge for the relevant utility system. The recoverable portion of the purchase price will be recovered in accordance with the amount and number of months agreed to by the parties.

B.5.5 CLIN 0004: Transition Period

The Offeror shall provide price information for the Transition Period in accordance with Section C, Transition Plan. The information to support the price proposed for the Transition Period shall include all costs associated with the Transition Plan. The Government agrees to pay for the Transition Period using the method proposed by the Offeror and accepted by the Government. This information shall be provided in Schedule 3 (See B.7.4).

B.6 Service Charges for Schedules B-2: Fixed Price with Economic Price Adjustment

B.6.1 CLIN 0001 – Utility Services Charge

The Utility Services Charge is the fully built up monthly charge to the Government for provision of utility services, including operations and maintenance and renewals and replacements (Schedules 1-2)(see B.7.2 and B.7.3).

Prices proposed for CLIN 0001 identified in Schedules 1-2 shall be based on expected price levels during the first year of operation. The effect of price inflation costs incurred in years subsequent to the first year of operation will be considered as part of the Economic Price Adjustment identified in B.6.1.1, Economic Price Adjustment – Price Index Utility Privatization.

B.6.1.1 ECONOMIC PRICE ADJUSTMENT – PRICE INDEX UTILITY PRIVATIZATION

(a) The Contractor warrants that the contract prices do not include any amounts to protect against increases covered by this clause.

(b) DEFINITIONS. As used herein,—

(1) Base price means the price for the Utility Services Charge under CLIN 0001 as identified in the contract Schedule B-2. For the first Economic Price Adjustment, the Base price shall be the original awarded Utility Services Charge. For subsequent annual Economic Price Adjustments, the Base Price for each Adjustment shall be the Utility Services Charge in effect immediately prior to that adjustment.

(2) Index means the Consumer Price Index for all Urban Consumers (CPI-U) reported in the publication, “Consumer Price Index – CPI,” published by the U.S. Department of Labor, Bureau of Labor Statistics for West urban; CUUR0400SA0, CUUS0400SA0 (CONSUMER PRICE INDEX – ALL URBAN CONSUMERS; ALL ITEMS; NOT SEASONALLY ADJUSTED).

(3) Base index is the CPI-U annual Regional Average Index for West urban; CUUR0400SA0, CUUS0400SA0 (CONSUMER PRICE INDEX – ALL URBAN CONSUMERS; ALL ITEMS; NOT SEASONALLY ADJUSTED) as follows:

(i) For the first Economic Price Adjustment, for calendar year ______. [NOTE: This will be filled in at contract award to reflect the last full calendar year for which the index is/will be available at the time that final proposal revisions were due.]

(ii) For subsequent annual Economic Price Adjustments, the Base Index shall be the “Current Price Index” utilized in calculating the immediately preceding Economic Price Adjustment.

(4) Current price index is the CPI-U annual Regional Average Index West urban; CUUR0400SA0, CUUS0400SA0 (CONSUMER PRICE INDEX – ALL URBAN CONSUMERS; ALL ITEMS; NOT SEASONALLY ADJUSTED) for the last full calendar year immediately preceding the year in which the annual adjustment occurs, with adjustments effective on the anniversary of the Contract Start Date.

(5) Adjustment amount shall be the product of the rate of change from the base index to the current index, multiplied by 100 percent of the base price.

(6) Adjusted price means the sum, rounded to two decimal places, of the base price plus the instant adjustment amount.

(c) It is hereby agreed that—

(1) The prices payable under this contract shall be subject to a prospective annual adjustment, which will be accomplished promptly following publication of the applicable index.

(2) Adjustments to the base price shall be determined by calculating the percentage of change from the base index, as stated in paragraph (b)(3) of this clause, to the current price index, as defined in paragraph (b)(4) of this clause. Adjustments to the base price shall not be compounded.

(3) Adjustment calculations under this clause are exemplified below.

Assume:

Index Northeast urban; CUUS0100SA0, CUUR0100SA0 (CONSUMER PRICE INDEX – ALL URBAN CONSUMERS; ALL ITEMS; NOT SEASONALLY ADJUSTED)

Base Price $10,000 per month

Current Index

229.306 (2008 Annual)

Base Index

220.512 (2007 Annual)

Calculate rate of change ((current index – base index) ( base index) from the index:

((229.306 - 220.512) ( 220.512) = .0398 or 3.98%

Calculate the adjustment amount (index rate of change x base price):

.0398 X $10,000 = $398.00

Calculate the adjusted price (base price plus adjustment amount):

$10,000 + $398 = $10,398.00 per month

(d) The Contracting Officer shall obtain the current Price Index and calculate the adjusted price.

(e) Adjustments pursuant to this clause shall be made by contract modification showing the calculation of the adjusted contract unit price and specifying its effective date.

(f) No adjustments shall be made unless the total change in the contract amount for the Utility Services Charge exceeds $500.00.

(g) Notwithstanding any other provisions of this clause, no increase(s) in a contract unit price applicable to any annual period of contract performance shall cumulatively exceed the base price for such item by more than 10.00% (ten percent) of the base price for such item. There shall be no percentage limit on downward adjustments under this clause.

(h) In the event--

(1) Any applicable index is discontinued or its method of derivation is altered substantially; or

(2) The Contracting Officer determines that an index consistently and substantially fails to reflect market conditions

--the parties shall agree upon an appropriate substitute index and the Contracting Officer shall modify the contract to specify use of such substitute index for determining price adjustments hereunder. The contract shall be modified to reflect such substitute index, effective on the date the index specified in the contract begins to consistently and substantially fail to reflect market conditions. Failure to agree on an appropriate substitute or adjustment shall constitute a dispute under the DISPUTES clause of this contract.

B.6.2 CLIN 0001: Monthly Credit as Payment for Purchase Price

The monthly credit is the monthly portion of the purchase price that will be credited to the Government over the number of months proposed by the Offeror. The purchase price is the product of the monthly credit (without interest) multiplied by the number of months the Government will receive the credit (CLIN 0001). The credit will be applied to the Utility Services Charge, as defined in CLIN 0001.

B.6.3 CLIN 0002: Initial System Deficiency Corrections / Connection Charges

Initial System Deficiency Corrections (ISDC)/Connection Charges are all nonrecurring costs to be paid by the Government to the contractor. These nonrecurring costs include costs required to bring the system up to industry/regulatory standards and costs for new connections/disconnections to be accomplished during the transition period. The requirement to perform an ISDC may originate from either a Government identified requirement, in which case the project will be listed in the relevant Utility Specific Attachment in Section J of this solicitation, or as a result of the Offeror’s determination that the ISDC/Connection is necessary to meet legally applicable regulatory requirements, or to achieve the standards typically maintained by the Offeror on its utility systems. The Offeror must provide rationale to support any projects the Offeror proposes.

The price for each ISDC/Connection is fixed. The price for each ISDC/Connection will be amortized over the term proposed by the Offeror in the Price Proposal. With every monthly invoice that includes a request for payment for an ISDC identified in Schedule 3, the Contractor shall submit an amortization schedule. The amortization schedule shall specify for each ISDC the principal and interest components of each monthly payment the number of the payment (of the total payments required), and the remaining principal balance.

The Government may make a lump sum payment for any or all capital investment costs that would normally be recovered through CLIN 0002. Lump sum payments, minus prepayment expenses permitted under the FAR, will reduce the remaining unpaid principal in the amortization schedule established for CLIN 0002. The amortization schedule will be recalculated based on the new, reduced principal amount amortized over the number of months remaining in the original amortization schedule. The interest rate used in the recalculated amortization will be the same as that used in the original amortization schedule.

B.6.3.1 Accounting for System Deficiency Corrections/Upgrades/Connection Charges B.6.3.1.1 Initial System Deficiency Corrections/Connections

The price for each Initial System Deficiency Correction/Connection is fixed. The price for each ISDC/connection will be amortized as proposed by the Offeror in Schedule 3 of the Price Proposal, will start the month after the ISDC/connection is put in useful service, and may reflect principal and interest. With every monthly invoice that includes a request for payment for an ISDC/connection identified in Schedule 3, the Contractor shall submit an amortization schedule. The amortization schedule shall specify for each ISDC the additional monthly payment to be included in addition to the Utility Services Charge and the number of the payment (of the total payments required).

B.6.3.1.2 Future System Deficiency Corrections/Upgrades

Payment for Future System Deficiency Corrections (SDCs)/upgrades for which the government agrees to pay in accordance with Section C, SDCs/Upgrades/Connections and Renewals and Replacements, will be in addition to the Utility Services Charge for the number of months agreed upon and will commence when the SDC/Upgrade is put in useful service. With every monthly invoice that includes a request for payment for such an SDC/Upgrade, the Contractor will include an amortization schedule. The amortization schedule shall specify for each SDC/Upgrade the additional monthly payment included in addition to the Utility Services Charge and the number of the payment (of the total payments required).

If new SDCs/Upgrades are required as a result of a change in service requirements, the monthly service charge may be re-negotiated, at any time, in accordance with FAR 52.243-1, Changes -Fixed-Price-Alt 1 or FAR 52.241-7 Changes in Rates or Terms and Conditions of Service for Regulated Services as applicable.

B.6.4 CLIN 0003: Recoverable Portion of the Purchase Price

The recoverable portion of the utility system purchase price will be listed in Schedule 4 (see B.7.5) for the relevant utility system. The recoverable portion of the utility system purchase price will be in addition to the Utility Services Charge or the Monthly Service Charge for the relevant utility system. The recoverable portion of the purchase price will be recovered in accordance with the amount and number of months agreed to by the parties.

B.6.5 CLIN 0004: Transition Period

The Offeror shall provide price information for the Transition Period in accordance with Section C, Transition Plan. The information to support the price proposed for the Transition Period shall include all costs associated with the Transition Plan. The Government agrees to pay for the Transition Period with the method proposed by the Offeror and accepted by the Government. This information shall be provided in Schedule 3 (See B.7.4).

B.6.6 Total Monthly Charges

The total monthly charge will be the sum of the Utility Services Charge, the Initial System Deficiency Corrections, the Connections, the recoverable portion of the purchase price and the transition period costs minus the credit for payment of the purchase price. The Utility Services Charge will be a monthly charge for the duration of the contract. All other charges/credits will be monthly charges/credits only for the duration of the amortization period proposed by the Offeror.

B.6.7. Economic Price Adjustment Alternate Index Methodology

If Offerors propose an alternate index or indices to Section B.6, Economic Price Adjustment Price Index Utility Privatization, Offerors shall specify (insert) the Government published index or indices they propose as a price adjustment mechanism in B.6.1.1, subparagraph (b)(2), (3), and (4) and provide the revised B.6.1.1 clause in full text. Offerors shall explain why the index proposed was selected, comprehensively describe the working of the price adjustment mechanism including the timing of adjustments and the composition of the base, and provide a sample calculation under B.6.1.1 (c)(3).

B.7 Price Schedule Data Sheets

B.7.1 General

All Offerors must provide the following information, except that Offerors proposing a Schedule B-1 Regulated Tariff Proposal are not required to submit Schedule 1 (see B.7.2):

For purposes of comparison to the Government Should Cost Estimate (GSCE) and to facilitate price/cost realism analysis of the operations and maintenance component of the monthly service charge, the Offeror shall clearly establish a direct correlation between the price listed in Schedule 1 (see B.7.2) and the operations and maintenance plan provided in accordance with Section L, Operations and Maintenance/Quality Management Plan. The Offeror shall provide detailed pricing data for all labor (direct and indirect), materials and procurement costs, insurance, equipment, general and administrative, overhead costs, and any other cost identified by the Offeror.

Renewals and Replacements are defined in Section C, SDCs/Upgrades/Connections and Renewals and Replacements. Renewals and Replacement are investments in the utility system to renew or replace system components that fail or reach the end of their useful life. For the Renewals and Replacements component of the monthly service charge, the Offeror shall establish a conceptual 50-year schedule for renewals and replacements of major system components given the information available in this solicitation, technical library, through site visits, and other pertinent information, with the understanding that during the course of the contract this schedule may change to reflect the actual condition of system components. The 50-year schedule for renewals and replacements shall be established as shown in Schedule 2 (see B.7.3) in current dollars (see B.6.1). For purposes of comparison to the GSCE and to facilitate price/cost realism analysis, the Offeror shall clearly establish a direct correlation between the applicable J-section inventory, the 50-year schedule for renewals and replacements and the renewals and replacements component of the Utility Services Charge presented in Schedule 1. If the correlation includes a residual value at the end of the 50-year schedule, the Offeror shall clearly demonstrate the basis for the residual value.

B.7.2 Schedule 1 – Utility Services Charge

Component

Monthly Charge

1. Operations and Maintenance (O&M)

2. Renewals and Replacements (R&R)

Total Utility Services Charge (to be entered into CLIN 0001 for Schedule B-2)

B.7.3 Schedule 2 – Renewals and Replacements – 50 YEAR SCHEDULE

Notes: For each inventory component/item listed in the applicable J-section inventory, clearly show the $ value of the planned R&R (if any) for each year 1-50

This Schedule represents the Offeror’s conceptual methodology that will be used for evaluation purposes.

Item

Service

Life

RCN

Planned R&R Year 1 (Const $) Planned R&R Year XX (Const $) Planned R&R Year 50 (Const $) Residual Value in Year 50 (Const $)

Total

B.7.4 Schedule 3 – Initial System Deficiency Correction(s) / Connection Charge(s)/Transition Period

Rate Project Cost

(Constant $)

Project will Be In Service

Amortization Period

(Months)

Monthly Charge

B.7.5 Schedule 4 –Recoverable Portion of Purchase Price

Amortization Period

(Months)

Monthly Charge

Recoverable Portion of

Purchase Price

B.7.6 Schedule 5 –Proposal 50 Year Charges to the Government, Constant 20XX$

Notes:

1. Offerors shall provide for Schedules B-1 and B-2

2. Contract year--Fill in for each year (1-50)

Contract

Year Contract Items

Purchase Price Credit

Purchase Price Recovery

Connections

Total of Row

Section C

Description/Specifications/Work Statement

C.1 Precedence

In accordance with FAR 52.215-8, any inconsistency in this solicitation or contract shall be resolved by giving precedence in the following order: (a) The Schedule (excluding the specifications) and any Preamble; (b) Representations and other instructions; (c) Contract clauses appearing in the solicitation or contract; (d) Contract clauses incorporated by reference; (e) Other documents, exhibits, and attachments; and (f) The specifications. Additionally, the terms and conditions of Sections A through K, including the Section J Attachments, shall take precedence over any inconsistent provisions contained within portions of the Contractor’s proposal incorporated in or made Exhibits to the Contract. Exceptions not specifically identified by the Contractor in their proposal in accordance with the requirements of Section L of the solicitation and expressly accepted by the Contracting Officer in writing shall not be deemed to be part of the Contract and shall not be binding on the Government.

C.2 Scope and Purpose

C.2.1 General

The Government is conveying the utility systems identified in this solicitation. Subsequent to the conveyance of the utility systems, the Government will acquire the corresponding utility services from the contractor as the new owner of the system. The Government is requesting proposals for the purchase of the utility systems listed in Section B.3, the conveyance of the infrastructure, and the acquisition of the identified utility services. The conveyance of the utility system and the acquisition of utility services are both subject to the terms and conditions of this solicitation. The Government will consider the purchase of commodities with the privatization offer(s) on a case-by-case basis.

C.2.2 Program Goal

The desired goal of the conveyance is to transfer all right, title, and interest of the United States in and to the utility systems listed in Section B.3. The transfer of title will be accomplished after contract award and full transfer is the intended and preferred consequence. Utilities Privatization includes two documents: (1) The Contract, which includes the Right of Access; and, (2) the Bill of Sale. The utility system being sold includes equipment, fixtures, structures, and other improvements utilized in connection with the utility system, which will be more specifically described in the Bill of Sale. The divestiture will not include the real property upon, under, or around the utility system.

C.2.3 Utility Systems

Attachments are included in Section J for the utility systems listed in Section B.3 and are herein referred to as “utility-specific attachments.” Each utility-specific attachment provides details specific to each Installation utility system and requirement. Upon contract award(s), the appropriate attachments will be included in the contract and the others will be removed.

C.2.4 Current Service Arrangement

The Installations currently use government-owned facilities to provide utility services. The utility-specific attachments describe the current service arrangement for each utility services and define specific requirements.

C.3 Requirement

C.3.1 Utility Services Requirement

Subject to the terms and conditions in this RFP, the Contractor shall furnish all facilities, labor, materials, tools, and equipment necessary to provide utility services.

The Contractor shall manage, control, and perform operations, maintenance, repairs, replacements, expansions, and incidentals on its utility system so as to provide reliable and dependable utility services to each Government or tenant connection within the service area (see Section C, Service Area) 24 hours each and every day. The Contractor shall be responsible for providing capital investments and all other resources required to own, maintain, and operate its utility system(s) in a safe and reliable condition, and to meet all the requirements listed herein.

The Contractor shall obtain and maintain current any and all licenses, permits, or certifications necessary to own, maintain, and operate its utility system(s). Access to the utility system will be as specified in Section C, Access to the Utility System.

C.3.2 Performance Standards

The Contractor shall ensure adequate and dependable utility service(s) to all facilities and equipment served. Unless otherwise provided for in this contract, the Contractor shall provide utility service(s) in accordance with industry-standard construction, operations, maintenance, management, environmental, safety, and other relevant standards, that apply to similarly situated utility services providers serving customers whose service characteristics are comparable to the service characteristics of the Installation.

Services provided shall comply with all applicable Federal, state, and local laws/regulations and any Installation specific requirements set forth in the utility-specific attachments, as they may be amended from time to time, including those requirements relating to health, safety, and the environment. The Contractor shall modify its service practice as necessary to accomplish such compliance.

If a change in the service requirement necessitated by compliance with later imposed/modified laws and regulations or Installation requirements constitutes reasonable cause for an adjustment to the service charge, the charge will be adjusted in accordance with FAR 52.243-1, Changes -Fixed-Price-Alt 1 or FAR 52.241-7 Changes in Rates or Terms and Conditions of Service for Regulated Services as applicable.

C.3.3 Sub- Metering

The Contractor shall be responsible for reading, maintaining, and calibrating all sub-meters on the privatized utility system(s), including those additional meters identified in the utility-specific attachments to be installed by the Contractor. Those additional sub-meters shall be installed within the transition period defined in the utility-specific attachments . The Government will use sub-meters for internal installation billing purposes and for commodity management and energy conservation purposes. Meter reading reports shall be submitted to the recipient identified in the utility-specific attachments .

All costs for providing, installing, reading, reporting, and maintaining the existing and additional meters shall be the responsibility of the Contractor. Contractors are encouraged to incorporate remote meter reading technology.

C.3.3.1 Future Sub-Meters

The Contractor shall provide, install, read, maintain, and calibrate sub-meters requested by the Government for any purpose throughout the contract period. Installation of and responsibility for future sub-meters (not on the system at the time of sale or identified for installation as part of the contract) may constitute reasonable cause for an initial installation charge and a service charge adjustment in accordance with FAR 52.243-1, Changes -Fixed-Price-Alt 1 or FAR 52.241-7 Changes in Rates or Terms and Conditions of Service for Regulated Services as applicable.

C.3.3.2 Sub-Meter Calibration

The frequency and accuracy of sub-meter calibration shall be in accordance with the manufacturer’s recommendations and applicable regulations that govern meter calibration.

C.3.4 Energy and Water Efficiencies and Conservation

The Contractor shall strive to provide energy- and water-efficient systems. The Government has an established program for conducting and implementing energy- and water-saving and conservation projects to reduce utility usage and costs. Some of these have resulted in the Government entering into long-term financing arrangements with non-government entities. The utility-specific attachments identify any such energy- and water-savings projects that are currently in place for the specific utility system.

The Contractor agrees to take no action that will negatively impact these projects without prior approval of…