Agenda Item - 2024-07-16 - Number 10.1 - Wastewater Treatment Facility RFP Honorarium 10.1
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Subject: Wastewater Treatment Facility Request for Proposals Honorarium
Meeting Date: July 16, 2024 Staff Member: Stefan Broadus, PE
Director of Special Projects
Report Date: July 5, 2024
Department: Public Works - Engineering
Action Required Advisory Board/Commission Recommendation
❑X Motion ❑ Approval
❑ Public Hearing ❑ Denial
❑ Ordinance ❑ None Forwarded
❑ Resolution ❑ Not Applicable
❑ Information Only Comments:
❑ Council Direction
❑ Consent Agenda
Staff Recommendation: Approve an Honoraria for the Request for Proposals for Wastewater
Treatment Facility Project.
Recommended Language for Motion: Move to authorize the City Manager to award
honoraria payments to responsive proposals to the Request for Proposals for the
Wastewater Treatment Facility project not to exceed $500,000.
Project/ Issue Relates To: Collaborate with the City of Portland to make a financially and
environmentally responsible long-term investment in a wastewater treatment facility.
Issue before Council (Highlight Policy Question):
❑X Council Goals/Priorities ❑Adopted Master Plan(s) ❑Not Applicable
BACKGROUND
The existing Tryon Creek Wastewater Treatment Plant (TCWTP) was built in 1964 and is owned and
operated by the Portland Bureau of Environmental Services (BES).The plant is reaching the end of
its useful life cycle and needs to be upgraded or replaced.
In 2018, the cities of Lake Oswego and Portland began actively exploring the option of a new
Wastewater Treatment Facility (WWTF) to replace the existing Tryon Creek plant under a public-
private partnership. On December 18, 2018, the Council approved Resolution 18-55, which
Respect. Excellence. Trust. Service.
503-635-0215 380 A AVENUE PO BOX 369 LAKE OSWEGO,OR 97034 WWW.LAKEOSWEGO.CITY
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authorized a special procurement using a competitive process to enter into a Design, Build, Finance,
Operate, and Maintain (DBFOM) contract for new wastewater treatment plant.
Following a competitive process that included a solicitation for Requests for Qualifications
(February 2019) and then Request for Proposals (Fall 2020) from the qualified firms, the City
selected EPCOR Foothills Water Partners (EWFP) as the preferred proposer. On May 4, 2021, the
City entered into a Preliminary Services Agreement (PSA) for the DBFOM of a new plant with EWFP.
Under the PSA, EFWP advanced designs to a 90% level and successfully completed phase one of the
WWTF Project. In January 2024, the City and EWFP were not able to reach agreement on the terms
of the Project Agreement, and the Council directed staff to explore competitive procurement
methods, including special procurement and alternative contracting methods for final design,
construction, operation and maintenance of a new WWTF. On May 7th 2024, Council approved
Resolution 24-19 amending Resolution 18-55 and authorizing a special procurement for a new
Design, Build, Operate, and Maintain (DBOM) procurement for the WWTF project.
DISCUSSION
The DBOM contract will be the result of a two-step procurement. The first step is a Request for
Qualifications.The three highest scored responses are expected to be shortlisted and eligible to
submit on the second step of the procurement which is a Request for Proposals. It is industry
standard practice with this delivery method to provide an honorarium or stipend to help to partially
reimburse the proposers not selected for award for their considerable effort in preparing a fully
responsive proposal.
Many other procurement methods do not use an honorarium because the level of effort required
to submit a proposal is significantly less. For example, the original DBFOM procurement for the
Project did not include an honorarium because proposers were not asked to commit to pricing at
the time of the proposal, complete design elements, plan detailed construction logistics, or lay out
thirty years of O&M in their proposal. Submitting a bid or proposal for any procurement is a
business decision that incurs costs for these entities, but fixed price DBOM and similar models are
on the next order of magnitude and thus an honorarium should be considered.
The fixed price DBOM will provide competitive proposals to help ensure the City is getting the best
price the market can provide. It is anticipated that the RFQ would shortlist 3 firms and the RFP would
result in a Project Agreement with the top firm. The two firms not selected would each receive the
recommended honorarium of $125,000 assuming a responsive proposal. The top firm would only
receive an honorarium in the event the City elects to not proceed with the project, which is not
anticipated. This is typically twice the amount provided to the firms not selected, in this case
$250,000. Under this structure, the maximum value of the honoraria would be $500,000, but the
anticipated total would be $250,000.
RECOMMENDATION
Move to authorize the City Manager to award honoraria payments to responsive proposals to the
Request for Proposals for the Wastewater Treatment Facility project not to exceed $500,000.
Respect. Excellence. Trust. Service.
503-635-0215 380 A AVENUE PO BOX 369 LAKE OSWEGO,OR 97034 WWW.LAKEOSWEGO.CITY