HomeMy WebLinkAboutCOM 0521.039 2002-2004 MfY 0I y~
Harry Kim ~,c~ William Takaba
Mayor ~ DireGOr
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:fir„ s'y'P~ Nancy E. Crawford
~ Deputy Director
County of Hawaii
Finance Department
25 Aupuni Street, Room 118 • Hilo, Hawaii 96720
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MEMORANDUM
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DATE: May 28, 2004 - .
TO: The Honorable James Arakaki, Chairman,
and Members`onf
the Hawaii County Council
FROM: Nancy Crawford) `
Deputy Finance Director
RE: Solid Waste Sort Station Funding
As you consider cutting funds for the East Hawaii Sort Station and delaying its
construction and operation, I would like to offer additional input from the finance
and procurement perspective.
The Council appears to expect that an RFP can be produced and distributed by
September, and that the responses, selection process and contract negotiation
can be swiftly completed. For comparison I would like to briefly describe the
process and timeline to select our new software vendors for the County fiscal
software. We knew that we were shopping for a product that would have afar-
reaching impact throughout our County system and that we would be entering
into along-term relationship with the vendor, so we wanted to be a thorough as
possible in our search for the right vendor.
As the Department of Environmental Management has done, we began with a
request for information. The needs analysis, collection of input from users and
development of the RFP took about six months. We knew that taking time to
develop the RFP well would help us get the best product and reduce the
probability of a protest. Vendors were given a little over two months to respond
to the RFP. During that time there were two rounds of questions from vendors to
Comm. No. Z~•
Raf. To: Presence
Ref. Go'e 1111 ~ Tllld
Hawaii County rs an equal ayporlunity provider and employer
County Council
May 28, 2004
Page 2
clarify our requirements. The selection process, which included demonstrations,
reference checks, site visits, clarification of items in the proposals and request for
best and final offer took five months. Contract negotiations took several more
months. Fortunately there were no protests from non-selected vendors.
Our timelines are not offered as a standard, but to illustrate what can be involved
in even a fairly simple RFP procurement. At any given time there are many
RFPs and contracts in the system and various events effect the procurement
timing. All of us involved in the process had ongoing regular duties that impacted
our ability to meet the RFP schedule. We were fairly safe from protest because
of the nature of the product we were purchasing. When the sale is relatively
small and there are many other customers, it's not worth taking time to protest.
The same could not be said for the waste management industry, where the
investment and profit potential are huge and customers are limited. It costs a
vendor nothing to protest a selection and might result in a change. The minimum
impact on the County is lost time before a contract can be signed and
implemented.
Aside from the procurement issues and risk of delay in building a sort station, the
actual cost to the County is a concern. The County is able to borrow money at a
rate lower than private contractors. We use a bid process for construction
projects that is designed to keep prices as low as possible. To pay out cash now
for the construction of the sort station will likely result in a savings to the County
over having the facility built by a private contractor who then recoups the cost,
plus profit for the life of the facility.
This information is offered in the hope that it will be of assistance in making this
difficult decision regarding the future of our island. Thank you for allowing me
this opportunity for input.
cc: Mayor
Director of Finance