Title
Oak Lawn Water Negotiation Contract Authorization
History
Beginning in August 2009, the Village began engaging three (3) different consultants for professional services related to due diligence review and the negotiations for contract renewal with Oak Lawn for water supply. The three (3) consultants and the amount approved are as follows:
WRB,LLC $196,000
Malcolm Pirnie Engineering $120,000
Holland & Knight $207,500
Total $523,500
Of the amount listed above, the Village is responsible for 33% of the expense. The remaining 67% is paid for by Mokena (10%), New Lenox (18%), Oak Forest (11 %) and Tinley Park (28%). The Village of Tinley Park acts as the administrator of the contract. To date, we have made substantial progress with Oak Lawn and are hopeful of completing the negotiations this year. By way of background, the collective work of our combined approach has generated very positive results. Specifically, the draft contract language now includes consent approval from member communities before certain expenses are made by Oak Lawn, review and input into operational issues, the provision and maintenance of an Asset Management Plan and Most Favored Nations clause in the event that any other town receives a better rate from Oak Lawn. In total, there were over 150 issues raised with the contract. Today, the universe of open items is less than 25, the majority of which are rate related. Throughout this process, Oak Lawn has been a good partner in terms of providing our community with the necessary details to negotiate with all the information on the table.
At this time, Oak Lawn has received initial approval from the Illinois Environmental Protection Agency (a possible funding source), to commence with bidding of the first stage of improvements. This would include approximately $10 million of pump improvements at the Hacker plant. In total, the overall value of improvements to the system for all eleven communities is approximately $160,000, 30% of the expenses related to the pumping capacity and the remaining 70% is related to construction of a redundant service line, also known as a looped system.
The current system has a pumping capacity of less than 60 MGD. The new system will have a pumping capacity of approximately 110 MGD which will be sufficient to satisfy the needs of the system based upon the 2040 population projections.
At present, our authorized expenditure for Holland and Knight is expired and the authorized expenditure for WRB, LLC will be exhausted within the next sixty (60) days. It was believed that the last authorization would be enough to get us to the completion of the negotiation process. However, based upon the amount of detail included in the agreement, additional proposals have been requested in order to get us the final completion. A summary of the work to be done by both is provided below:
Holland and Knight - $115,000
1. Contract Review and Drafting;
2. Meetings with Work Group Members;
3. Negotiations with Oak Lawn;
4. Legal Research/Options.
WRB, LLC - $52,305
1. Meetings July 1 through September 30, 2013, 16 meetings will be required with four different groups, Oak Lawn (5), Managers (5), Mayors (3) and Working Team
Members (3):
2. Finalizing the agreement includes the agreement itself, which will include a re-write and verification of what we have already seen with sub set work on non-rate issues and rate related issues; and
3. Post Agreement Work.
The Manager's Committee has reviewed the scope of services for each proposal and recommends approval. In terms of day to day supervision of the Engineer and Attorney, as before, Bill Balling, WRB, LLC, will perform the necessary oversight.
On June 17, 2013, this item was reviewed and approved by the Public Works and Engineering Committee and referred to the Board for approval.
Financial Impact
As noted above, the combined amount will be distributed on a prorata basis and the Village's exposure would be $55,210 of $167,305 (33%). However, the way the proposals are written, we are not obligated to pay the full amount if the hours are not used.
Recommended Action/Motion
I move to approve entering into a reimbursement agreement with Village of Tinley Park, IL for the professional services outlined in an amount not to exceed $55,210.