Loading...
HomeMy WebLinkAboutCOM 0711.002 2002-2004 JMtV OF ry,K 4~'~ ~y j ~li~~. Harry Kim Barbara Bell Jy;, r-, Director trE Qj~NF'•1 Nelson Ho Deputy Dirulor Cn,~un#u of ~ttitrtzti DEPARTMENT OF ENVIRONMENTAL MANAGEMENT 25 Aupuni Stree[, Room 210 • Hilq Hawari 96720-4252 (808) 961-8083 • Fax (808) 961-8086 July 30, 2004 O^ c The Honorable James Y. Arakaki, Chairman And Members of the Hawaii County Council -c• 25 Aupuni Street Hilo, HI 96720 Subject: Waste Reduction Technologies Dear Chairman Arakaki and Members of the Council: Attached is supplemental information the Council may find helpful for discussion and decision- making regarding County procurement of waste reduction technologies. Ted Vorfeld, President of Hualalai Engineering, has provided this information after reviewing the responses that were received in response to the Waste Reduction Technology Request for Information. If I can be of further assistance, please don't hesitate to contact me. Aloha, ~ii~l~i~ Barbara Bell DIRECTOR attachment Comm. No. , ~ • 2- Ref. To• Ref. Date I 1 Hnwoi'i County is an equal opporluniry provider and employer. 07/30/04 WASTE REDUCTION TECHNOLOGY INFORMATION RELATED TO THE COUNTY REQUEST FOR PROPOSALS 1. THE TIPPING FEE Atypical tipping fee for amass-burn facility would be about $40 per ton for operation, maintenance and profit plus $35-$70 per ton for debt service, assuming private financing with no SPRB, or a total of $75-$110 per ton. With SPRB usage, the debt service will drop to $16-$35 per ton or a total of $56-$75 per ton. 2. USE OF PRIVATE FINANCING The ability of a bidder to provide bank financing indicates a process which is considered by financing institutions as a reliable and recognized method of disposing of waste. It is a means for eliminating processes of an experimental or risky nature. Further, it minimizes the County's risk of exposure to legal action in the event the process or the operator goes bankrupt. In the event the County is comfortable with the technology selected, the surety provided and the operating firm's capability, a switch to SPRB can be considered. Such a switch, if elected, would lower the debt service portion of the tipping fee by as much as $20-$35 per ton. 3. TRANSFER TO COUNTY OWNERSHIP AFTER 20 YEARS Not only might the facility be usable after twenty years, the need for this provision ensures that at the end of the operating contract, the County is not held hostage by not having an immediate method of disposal. Continuation of an operating contract by the plant operating firm will be offered on a negotiated, first right of refusal basis. Maintenance of the facility in good working order at the end of 20 years will also be included. 4. DEMONSTRATION OF END MARKET Many of the bidders will have a primary product, such as electricity, gas or compost. This product may contribute as much as $15-$25 per ton towards reducing the tipping fee. Since this amount is likely to be substantial, it is in the County's best interest to be certain the product can be marketed at or about the projected rate and for the County to not accept responsibility to market this product. The RFP needs to specify that the bidders provide evidence of such a market in the form of a letter of commitment from a reliable purchaser. 07/30/04 5. REDUNDANCY The RFP needs to stipulate that the waste will always be accepted, absent a force majeure, either through redundant equipment or by diversion to landfill. 6. BONDS AND PENALTIES A bid bond of $50,000 is suggested in order to eliminate bidders with little or no financial strength. (Ordinarily, bid bonds of/.% of constructed cost are stipulated in most construction contract bids.) A performance bond equal to the cost of landfilling for 5 years is suggested since this is a period required to re-bid and build a replacement facility in the event the selected process fails. The RFP will also contain penalties for short term lack of performance as well as a provision for the County to step in and obtain another operator who can use the facility in the event of default by the original bidder. 7. BIDDERS TO VISIT COUNTY TRANSFER STATION OPERATIONS Since many of the potential bidders may not be familiar with the County's method of waste receipt, there is a need to assure the County that no misunderstanding takes place during the bidding process. The waste coming from the transfer stations contains materials not ordinarily found in areas where home pick up is practiced. For example, the transfer stations accept carpeting and mattresses and very often do-it-yourself demolition materials such as drywall, treated lumber and some amounts of green waste. The County cannot guarantee the quality of the waste stream to any great extent and this needs to be made known to the bidders. 8. EXPANSION CAPABILITY The RFP needs to address the capability to handle growth, either in the initial build out or in provisions to expand. This needs to be discussed at some length since it will affect the tipping fee.