Vendor Selection Committee Recommends Cimarron for Orcas Transfer Site

Recommendations to the San Juan County Council Based  on the review  of Vendor  Responses to the Request for Proposals for Orcas Site Solid  Waste Services and Operations — July 20, 2012.

Process

In June, SJC issued an RFP for Orcas site solid waste service and operations, with a proposal submission date of close of business July 13, 2012. Concurrently, SJC formed a Vendor Selection Committee (VSC) to prepare procedures to review received proposals and to make a selection recommendation to the SJCC in late July.  Members included two citizens from Orcas, two county staff, the County Prosecutor (as legal advisor), and Council Chair, Patty Miller. One of the Orcas Citizen members resigned prior to the completion of review procedures and was replaced by the designated alternate. All VSC meetings, including in-person presentations by the respondents, were conducted in posted public meetings.

In response to the RFP, timely proposals were received from Orcas Recycle Services, Inc. (aka “The Exchange”) (ORS) and from Cimarron Enterprises, Inc., (Cimarron) the firm currently providing the transportation bridge between SJC facilities and the waste delivery point on the mainland. The VSC members met on the morning of July 13 and agreed upon a scoring matrix to rank proposals in accordance with the RFP’s Vendor Selection Criteria. VSC members received the written proposals on the evening of July 13and independently reviewed those proposals during the period July 13-15.  The VSC convened in a public meeting on July 16 to share their preliminary numerical evaluations (Table 1) and to identify potential issues and concerns deserving further clarification from the respondents during in-person presentations. In­ person presentations were made by Cimarron Enterprises on July 17 and by Orcas Recycle Services on July 18.

Findings of the Vendor  Selection Committee

During the initial evaluation, prior to vendor presentations, neither proposal received a combined total score exceeding 70% of the total possible due to several common shortfalls:

• Both proposals assumed the availability of additional parcels and county-owned equipment beyond that identified to be available in the RFP.

• Neither proposal included signed letters of commitment from entities identified as partners, parent organizations, or preferred vendors.

• Both proposers made proposed commitments to satisfy RFP Requirements that were poorly defined or contingent upon negotiations with other entities or the outcome of future events.

• Both proposals lacked sufficient transparency and detail to fully identify key assumptions, such as pending changes in waste management for Lopez, the Town of Friday Harbor, and any curbside recycling service on Orcas.

• Neither proposal detailed financial capacity nor operating plans for the start-up phase that would assure the continuity of current services at the Orcas site by the end of the year.

• Both parties indicated the possible application of a waste-to-energy  system by Kentec, Inc, but did not include costs or integrate this potential technology into their plans and commitments.

The combined preliminary scores for the respondents, based upon VSC member review of the written proposals, differed by less than 2% of the total possible score. However, the preliminary scores also revealed that:

• Members perceived ORS to offer a more robust array of reuse and recycle services and commitment to the reduction, reuse and recycle of waste, but scored a greater variation in ORS’ perceived ability to credibly and confidently secure markets, execute plans and obtain permits for reuse and recycle products and services.

• Members perceived significant variation in their assessment of ORS’ overall ability to execute their proposals as planned, including start-up financing, securing and complying with permits, and securing and managing vendor relations and costs.

• Members recorded a significant variation in the perceived convenience of proposed services and operational viability of the Cimarron proposal as a result of the lack of the transparency and detail, especially cost assumptions, and uncertain commitment to identified improvements.

After oral presentations, VSC members developed a consensus set of findings regarding the strengths and weaknesses of the two proposals:

Perceived greater strengths with the Cimarron proposal:

• Their ability to accommodate variation in waste stream volume and composition.

• The validity of Cimarron’s existing affiliate relationships and progress toward solidifying the remaining necessary agreements.

• The adequacy and outlook for stability of its proposed price structures.

• Their management expertise, including administrative, on site, and financial.

• Their readiness to execute a smooth transition.

However the VSC had significant continuing reservations with the Cimarron proposal in several areas:

• Compatibility with The Exchange.

• Overall responsiveness to the County’s solid waste management plan which identifies waste reduction, recycling, and reuse as top priorities.

• The ability of the proposed operations flow to smoothly accommodate peak self-haul demand.

• The adequacy of its outreach program, especially with regard to self-haul customers.

Perceived greater strength with the ORC proposal:

• Commitment to the County solid waste management  plan as reflected in the proposed range of services provided in the area of waste reduction, reuse and recycling.

• Innovative techniques for outreach and education.

• Number of in county jobs in particular at a management level.

• Partnerships with other island based businesses.

• transparency and specificity of proposal.

The VSC had continuing reservations with the ORS proposal in several areas:

• Lack of progress in solidifying agreements with essential partners as necessary to maintain adequate waste volumes to assure viability at reasonable cost to the consumer.

• Lack of resilience in the business model to .accommodate unforeseen changes in key assumptions and. no guarantee of price struc. ture.

• Lack of demonstrated management experience to plan, integrate, and execute the proposed range and scope of site operations, services, and transport.

• Lack of demonstrated access to adequate capital to fund start up and transition costs.

• Increase in risk during the transition and the uncertainty of long-term service sustainability due to the number of substantial changes to the management  of most of the lines of service which comprise the SJC waste stream.

Recommendation

Neither proposal sufficiently addresses all of the stated RFP vendor selection criteria.  However, the VSC has initially determined that Cimarron is the best qualified to provide one or more of the seNices  related to the proposal per RCW 36.58.090(4) with the proviso that:

•   Prior to entering into contract negotiations, we recommend that the Council request that Cimarron modify its proposal to address two key inadequacies:

– Enhance its compatibility with The Exchange through a clearer strategy for further waste reduction, recycling and reuse.

-Strengthen and enhance its strategy for public communication,  outreach and education.

• Prior to long term commitment by SJC to Cimarron for use of parcels beyond that made available in the RFP, the VSC recommends that Council gains comfort with any revised Cimarron strategy to further waste reduction, recycling and reuse.