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to 07 98 "ED 11:52 FAX 808 520 $ean . R&D - HILO f~uu1 10/07/98 %ED 11:55 FAX 808 935 1205 Corli Res & Dev Diane 9111tlquir Lol 0- Form 1/18/91 DEPARTMENT QF FINANCE REQUEST FOR COUNCIL ACTION DEPARTMENT: Research and Development DATE: October 7, 1998 STAFF CONTACT= Raymond Carr PRONE 961-8497 A. REQUEST, Submit a Resolution (draft is attached) permitting Mayor to enter into a multi-year performance contract. B. BACKGRQUND AND JUSTIFICATION (USE ADDITIONAL SHEETS AS NXXDE,D)= In early 1997, an energy efficiency retrofit was carried out for the Hawaii County Building in Hilo by means of a performance contract. Electricity cost savings of 567,406 were realized in the first post-retrofit year as a result of these measures. These savings, together with maintenance cost savings, are adequate to fund the payments on the municipal lease ($480,940 purchase price at start of lease) and other costs associated with the retrofit. The contract term is ten years after which all equipment is owned by the County free and clear and all subsequent energy cost savings accrue to the County. In view of the favorable experience with the Hawaii County Building project - the county did not have to provide CIP funds and project costs were funded through proven cost savings - it is intended to use a performance contract with a ten-year term to carry out efficiency retrofits to the remaining inventory of County owned buildings and facilities operated by Police, Fire, Parks & Recreation, Real Property and Public Works departments. It is requested that County Council authorize the Mayor to enter into a performance contract for this project. It should be noted that, at a later date, County Council authorization will likely be requested to permit the Mayor to enter into a ten-year municipal lease agreement to fund this project. At that time, detailed engineering and financial terms of this project will be available to County Council. SIGNED. WIw J- vlt-9ud: _ DATE: 107 98 Dep rtmant Head