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Jeff Panel to Interview 2 Top Bidders for Sewer Plant Operator
The Courier-Journal Louisville, KY
Tuesday, March 2, 2004
Jeff panel to interview 2 top bidders for sewer plant operator
Byline: ALEX DAVIS alexdavis@courier-journal.com
Two companies that are the leading contenders to run Jeffersonville's waste-
water treatment plant will be interviewed in separate public meetings today .
Environmental Management Corp., which has served the utility's 11,000 customers
as the plant operator since 1994, will be interviewed at 4 p.m. A discussion
with the other finalist, Louisville's Metropolitan Sewer District, will begin
at 6 p.m.
After talking with officials from both companies - both meetings will be on the
fourth floor of the City-County Building - a selection committee is expected to
make a recommendation to the city's sewer board on March 22.
Four companies initially sought the contract, which will be worth an estimated
$5 million to $6 million over the next three years. The process of reviewing
the contract and selecting finalists has been lengthy and, at times,
contentious.
Environmental Management sued the city last fall, claiming a decision on a new
operator before the end of 2003 would violate the company's existing contract,
which expires April 30.
The suit eventually was dismissed, but new concerns surfaced last week when the
two finalists were named. The proposal from Environmental Management, of St.
Louis, was the second most expensive of the four. MSD, which received the
highest ranking of the four companies, was the most expensive.
Those results prompted an executive from American Water Services Inc., which
submitted the least expensive plan, to question the political relationship
between Environmental Management and Mayor Rob Waiz.
Larry Wilder, an attorney who has represented Environmental Management in the
past, was a key supporter of Waiz in his campaign for mayor last fall. Waiz
also received a $1,000 political donation from the company.
David Baker, American Water's regional director of business development, said
yesterday that the company did not plan to pursue the matter.
"We were very disappointed that we weren't short-listed," he said in an
interview. "Our bid financially was quite a bit lower, (but) there's a lot of
twists and turns in these decisions."
Wilder has said he had nothing to do with the ranking process.
Waiz said last week that he made a mistake in ranking the four companies,
mixing up the data for each company's estimated profit. But he said the error
didn't affect the final outcome of his rankings, and he said politics had
nothing to do with the selection process.
Jack Danks, an Environmental Management vice president in Evansville, said the
donation to Waiz was not intended to win any favors on the contract.
After the seven-member selection committee makes its recommendation, the
Jeffersonville Sewer Board will decide which bidder gets the contract.
Jack Jordan, a member of both the selection committee and the sewer board, said
he was "very concerned" about the results of the rankings. He said the process
usually results in similar outcomes from about three-fourths of the members of
such committees.
But Jordan said yesterday he intends to proceed with today's interviews. In an
"extreme situation," he said, he would be prepared to disregard the committee's
recommendation when he votes on the contract.
The other two members of the sewer board are Waiz and Jeff Caldwell. Caldwell
couldn't be reached yesterday.
If MSD is selected for the contract, it would mark the agency's first foray
into Indiana. MSD officials have said the contract could be helpful in
promoting a more regional approach to the health of the Ohio River and to
pollution issues in general.
Lee Garrigan, director of legislative affairs for the Association of
Metropolitan Sewerage Agencies, applauded that strategy.
"Consolidation in geographic areas or watersheds is a very good idea because
it's cost-efficient," she said in a telephone interview from Washington, D.C.
Both Louisville and Jeffersonville have sewer systems that combine storm water
and waste water. During heavy rainfall, the volume sometimes overwhelms the
system and the overflow goes into streams and rivers in violation of state and
federal environmental guidelines.
Garrigan said consolidation of multiple sewer utilities under a single
government is not widespread. The association is a non profit group with about
300 members, representing a majority of the nation's public-sewer customers.
She also said the ability to deal with complex environmental regulations -
which could head off government fines - sometimes transcends the importance of
finances during the selection of companies for such contracts.
The financial portion of the proposals in Jeffersonville made up 40 percent of
the total criteria for the rankings. Some companies used different approaches
to items such as overtime, electricity costs and maintenance in preparing their
financial proposals.
Also, some members of the selection committee used their own discretion in
weighing the credibility of the financial figures. Others said they gave each
company a point value based simply on the numbers provided.
Robert Miller, a former MSD executive hired as a consultant for the bid
process, said he did not offer detailed information on how to interpret the
proposals.
"It's the selection committee's prerogative to make a recommendation," he
said. "I can't really comment on how individual members went about that."
Miller said he last worked for MSD in 2001 and no longer has a financial
connection to the agency.