Questions and Answers Related to the Preproposal Conference
Questions and Answers Related to the Preproposal Conference
HeldWednesday, January 10, 2007
For the Request for Proposals to
Conduct aManagement and Operations Audit of
Pennsylvania-American Water Company
Q1. Audit Contract paragraph II.C.4(b) states that the "reasonable costs of presenting the Management Audit findings and conclusions will be paid for by the Utility at the Consultant's standard compensation rates." Should this be interpreted to mean that providing sworn testimony must be at the same rate as charged for the audit itself?
Answer. Yes, more specifically the same rate as charged by the respective consultant at the time of the audit who is required to provide the sworn testimony.
Q2. A number of statutes cited in the RFP are not yet available electronically. Will the PUC make the following available to the bidders?
a. Commonwealth Management Directive 215.9, Contractor Responsibility Program (RFP p.21)
b. 66 Pa.C.S.2102 (RFP p.27)
c. Act 21 of 2004 codified as Chapter 14 of Title 66 of Pennsylvania Consolidated Statutes (p.28)
d. 52Pa. Code 69.801-809, Policy Statement on Diversity at Major Jurisdictional Utility Companies (RFP p.28)
e. 52Pa. Code 101 (RFP p. 29)
Answer. See the following links: a. Commonwealth Management Directive 215.9 Contractor Responsibility Program b.Link provided on the PUC website c.Link provided on the PUC website d.52 Pa.Code § 69.801-69.809 e. 52 Pa. Code § 101
Q3.What is the PUC's schedule for awarding the contract and completing the work?
Answer. See Section I-12 of the RFP- “For this RFP, the proposal must remain valid for at least 120 days.” No specific completion date has been set by the Commission. It will be dictated by the winning consultant’s bid. However, the Commission is interested in completing the project as soon as reasonably possible and therefore the length of the time line included in the proposal will be a consideration in the selection evaluation.
Q4.Provide the number and location of Pennsylvania-American Water facilities in Pennsylvania and the location of the customer service facility.
Answer. PAWC operates and maintains 37 water treatment facilities, 4 wastewater treatment plants and over 100 wells that pump either to a water treatment facility or directly into a distribution system. Approximately 225 water storage tanks are located on the distribution systems. About 30 distribution centers are operated locally to serve customers; house company vehicles, equipment and inventory; upload daily meter-reads, etc. The Company prefers not to make the exact addresses known in this forum but, obviously, the facilities are located throughout the 35 counties in which it operates.
The locations of the customer service facilities were previously provided in the RFP package that the Commission distributed to potential Offerors. One is located in Alton, Illinois, about a 45-minute drive from the Lambert-St.LouisInternationalAirport. A second customer service facility is located in Pensacola, Florida.
Q5.Can interviews be arranged at a central location?
Answer. No, not entirely. However, the majority of interviews can be conducted in a limited number of locations. Most of the interviews can occur in either,Hershey, PA, or Voorhees, NJ. Voorhees is about a 2 hour, 15 minute drive from Hershey. Also, customer service was one of the Pre-Identified areas or issuesdesignated for an in-depth analysis in Phase-II. Consequently, auditors would probably be unable to gain an appreciable understanding of the customer service function without visiting the Alton call center and conducting onsite interviews.
Q6.Are compliance and operating records centrally located?
Answer. No. Most compliance and operating records are maintained at the various operating sites (i.e., district offices, operation garages, etc.). Some information may be collected and consolidated on a Company basis by functional leads, whom are physically located in multiple locations, for various reporting/other purposes. For example, routine monitoring and reporting of treatment plant operations, water quality in the distribution system, etc., is reported to regional DEP offices by local personnel. However, records of DEP Notices of Violations or other significant regulatory issues are maintained centrally for tracking and to ensure corrective action(s) to the processes occurred.
Q7.Is a copy of the most recent audit report available?
Answer. Website link provided on the PUC website for the 2000 Focused Management and Operations Audit of PAWC and the Company’s implementation plan.
Q8.Can we be provided with a detailed table of organization?
Answer. The best organization charts available at this time were provided in Attachment F of the RFP.
Q9.Does the proposal being at the PennsylvaniaStateMailCenter(or logged into the mail delivery system) by 4pm on Wednesday, January 31, 2007 qualify as being an on-time delivery?
Answer. No. The proposal must be in the Pennsylvania Public Utility Commission Bureau of Audits’ hands by 4 pm on Wednesday, January 31, 2007 to qualify as a valid proposal.
Q10.Does Section I-5 of the RFP mean to indicate that there is not retention of payment?
Answer. No. There is retention of payment. As stated in I-5 of the RFP the final 10% of the contract amount will be withheld until the final consolidated draft and final report are delivered.
Q11.In reference to RFP Section I-19, will previous work products that are submitted with the proposal be returned to the Offeror? Can the Offeror provide a FedEx account for the documents to be returned?
Answer. The Offeror can request the return of previous work products. However, the return of previous work products to the Offeror is at the discretion of the Public Utility Commission. The Offerorcould provide a delivery service (FedEx, UPS, etc.) account number to facilitate the request.
Q12.Can the Offeror submit electronic versions of previous work in lieu of hardcopies?
Answer. At this time, the Offeror may not submit electronic versions of previous work products in lieu of hardcopies.
Q13.In reference to RFP Section II-9, is the price per hour or per task?
Answer. As outlined in section II-9 of the RFP, cost should be broken down by consultant including billing rate per hour for Phase I and by pre-identified issue for Phase II (as exemplified on page 18 and 19 of the RFP). Phase III is to be reflected as one-half the total cost of Phase I.
Q14.In reference to RFP Section III-5, should the Offeror disclose previous or current work for other state utility commissions?
Answer. Yes.
Q15.In reference to RFP Section IV-2 Phase I- Diagnostic Review, are customers of the utility considered external parties?
Answer. Yes.
Q16.In reference to RFP Section IV-2 Phase II- Pre-Identified Areas or Issues, Issue No. 2, is the Offeror looking at the proposed PAWC IPO? Does the possibility of the IPO diminish the significance of this Pre-Identified Issue?
Answer. The consultant will look at past and current events. If the IPO takes place during fieldwork, then the IPO will need to be looked at. PAWC is predicting the IPO to take place in latter half of 2007. This issue is not diminished by the possibility of the IPO.
Q17.In reference to RFP Section IV-2 Phase II- Pre-Identified Areas or Issues, Issue No. 6, why is the impact of the statewide Verizon Fiber to the Premise program being looked at? Does Pennsylvania have a call before you dig program?
Answer. The Verizon Fiber to the Premise program is an issue generic to all PA utilities due to Verizon’s aggressive rollout of its fiber program resulting in damages to other utilities throughout the state. Pennsylvania has a call before you dig program called PA One Call.
Q18.How many of the Pre-Identified Areas or Issues have been eliminated in previous management and operations audits?
Answer. None so far, but the Commission makes a determination for each project based on the cost of the various Pre-Identified issues.
Q19.What is the status of the proposed IPO?
Answer. Approval is needed in 13 states. So far, it has been approved by Maryland, Virginia, Tennessee, and Hawaii.
Q20. How many employees are located at the Hershey, Pennsylvania office?
Answer. Approximately 90 employees.
Q21.Which company functions are provided by the Vorhees, New Jersey office which may require the Offeror to conduct on-site interviews?
Answer. Corporate governance, Internal Audit, Corporate Finance, Treasury Function, to name a few.
Q22.Can the contract be modified?
Answer. The contract can be negotiated after selection of the consultant. It is not common practice for the Pennsylvania Public Utility Commission to modify the contract. However, due to the recently initiated investigation of the company’s recent main breaks and related incidents, per the Commission order at Docket No. I-00060112 entered January 5, 2007 (website link provided),there is a possibility that this contract mayneed to be modified before it is executed.
Q23. What is the budget for this project?
Answer. The budget, both for hours and dollars, will be based on the winning consultant’s bid.
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