Spokane Waste to Energy
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MEMORANDUM

TO:                  Recipients of City of Spokane RFQ/P NUMBER:         3497-08

FROM:            Russ Menke, Interim Director

DATE:             June 23, 2008

RE:                   Questions and answers

Following are questions received to date on RFQ/P NUMBER: 3497-08 SPOKANE REGIONAL SOLID WASTE SYSTEM PERFORMANCE AND FINANCIAL AUDIT, and answers to those questions.

  1. What period (i.e., current and/or historical years) of operations of the system do you anticipate the review to include?

Under the City’s records retention schedule, primary invoices are retained for a period of six years. Therefore, we would expect the review to include the past six years.

  1. When you use the term “financial audit” in the first sentence of the Purpose section of the Introduction, do you mean a audit of the financial statements of the department in terms of their compliance with GAAP and GAFR?

No. We believe that the itemize scope of work better indicates the types of reviews we would like to see.

  1. Is the review of the WTE facility limited to its financial performance as opposed to other system and contractual matters?

While the intent of the scope is to review the financial performance of the WTE facility, we are open to suggestions as to other types of reviews that proposers may feel are necessary or desirable.

  1. What jurisdictions do you consider to be comparable for purpose of this review (e.g., Tasks 5 and 10) and have you enlisted their cooperation?

We have not specifically identified any particular jurisdictions for comparison with the waste to energy facility (Task 5) or the system as a whole (Task 10). We would expect to develop the list of jurisdictions in consultation with the selected contractor as part of the detailed work plan developed as part of task 1.

  1. Besides the final presentation, do you anticipate any other stakeholder/public meetings?

No. If additional presentations are required, they would be reimbursed as additional services.

  1. Is it correct to assume that we can obtain a business license once selected for the engagement? 

Yes.

  1. What is your expected commencement and completion dates for the engagement?

We anticipate completion of contract approval by approximately the end of September. We anticipate the project may require 6 – 12 months for completion.

  1. What is your budget/expectation for the cost of the review?

This project has not been specifically budgeted in our 2008 budget. We anticipate financing any 2008 expenditures from unexpended funds, and to budget for 2009 expenses. While we have no specific target in mind, we believe that this project may cost $150,000 to $300,000.

  1. What do you see as the differences between scope of work item 8 and item 10?

Upon further reflection, we do not see a substantive difference between work item 8 and work item 10. Work item 8 provides more detail than the general statement of item 10.

  1. How many people are on the Liaison Board and the SWAC and are some of the people the same?

The Liaison Board is comprised of 6 persons, all being elected officials, two of whom represent the City of Spokane, two of whom represent the Board of County Commissioners, one elected representative of the City of Spokane Valley, and one elected official representing the Regional Cities.

The Solid Waste Advisory Committee (SWAC) is currently comprised of 12 individuals appointed by the Board of County Commissioners. Two individuals currently serve on both the Liaison Board and the SWAC.

  1. The RFQ/P refers to the proposer as a consultant but also asks that the audit incorporates generally accepted accounting principles and follows GASB pronouncements.  Is it expected that the successful proposer will be a CPA firm?

No.

  1. The RFP does not specify the standards under which the performance audit will be conducted.  Are the standards to be used the Government Auditing Standards issued by the issued  by the Comptroller General of the United States?  If not, which standards are to be used?

No specific standards are applicable. As noted in the introduction to the RFQP, the overall goal of this performance and financial audit is to identify opportunities that will improve the System’s efficiency and effectiveness as well as its accountability to the City of Spokane, Spokane County, and the Regional Cities. Specific accounting-type analyses include assessing whether costs are properly allocated between the System and the City’s Solid Waste Management Department, which is responsible for solid waste collection within the City, as well as whether interfund charges by other departments are in accordance with the Interlocal Cooperation Agreement.

  1. Can interested bidders participate in the pre-proposal conference by teleconference?  Can you provide a call-in number?

Yes. The call-in number has been previously distributed electronically.

  1. Would the risk assessment for this engagement be expected to be conducted at an entity level or for each item identified in Section 2.1 - Scope of Work? 

We do not understand the question.

  1. There is no indication in the RFQ/P on the weighting of the evaluation criteria.  What weight will be placed on overall cost and on the location of the team members?  How will this weighting be affected if a proposer agrees to base the team in Spokane when on-site fieldwork is necessary?

Overall cost will be a relatively minor factor in the evaluation criteria. This weighting would only be affected by the degree to which basing a team in Spokane would result in cost savings.

  1. The System has only 8 employees.  Is there extensive use of contractors to perform the work of the System?  To what degree are contractors, their performance and they accounting/payments to be included in performance and financial audit?

The waste to energy facility is operated under contract by Wheelabrator Spokane Inc (WSI). It is anticipated that the invoices from WSI to the City will be reviewed as a part of the audit process.

The transfer stations are operated on behalf of the System by the City of Spokane Solid Waste Management Department, and paid through interfund transfers. These costs will also be subject to the audit process.

  1. Have their been performance audits of the System conducted in the past?  Can we obtain copies of these performance audits as part of the bid process?

No previous performance audits have been performed.

  1. As part of the bid process, can you provide copies of, or direct us to where we can find, budget documents, the Spokane County Comprehensive Solid Waste System Management Plan, and prior System financial statements?

The following link will take you to the current Spokane County Comprehensive Solid Waste Management Plan (1998). http://www.solidwaste.org/solidwaste/uploads/1998%20comprehensive%20sw%20mgmt%20plan.zip

Budget documents and prior System financial statements are not easily accessible, but will be provided to the selected contractor.

  1. On page 3, Scope of Work, relating to the Oversight Committee, how frequently do you anticipate update briefings on the progress of the audit to the Committee?  Are there other entities that might require update briefings?  Who would these be and what would be the frequency of the updates?

We anticipate a total of three briefings for the Oversight Committee, one at completion of the work plan, one during the audit process, and one upon completion of the draft report. We have not identified any other entities who will require briefings.

  1. On page 3, item 5, you refer to an assessment of the System's Waste-to-Energy facility's financial performance compared to similar facilities.  Can you provide us with criteria for how you want "similar facilities" to be determined?    Or do you want the consultant to determine the criteria?

We would expect similar facilities to be mass burn waste to energy facilities located within the US with a throughput capacity of approximately 800 tons per day.

  1. On page 3, item 6(a), the RFP asks for a review and assessment of the general budgeting and accounting practices and procedures, and how budget forecasts relate to expenditures.  What type of enterprise resource planning (ERP) system is used?  Will the auditor be able to obtain electronic files directly from the system?

The City of Spokane (including the System uses the Financial Management System (FMSII) provided by Mitch Humphrey and Co. Access will be limited. The System’s accountant will provide the results of queries to FMSII.

  1. On page 3, item 7, relating to interlocal agreements, how many Interlocal Cooperation Agreements does the System have?  Can you provide an example for us to review to assist us with the proposal preparation?

All the Interlocal agreements can be accessed by utilizing the following link. The principal Interlocal agreements for purposes of this audit are the agreements between the City of Spokane and Spokane County.

http://www.solidwaste.org/solidwaste/uploads/swmp%20appendix%20a%20interlocal%20agreements%20final.pdf

  1. On page 4, item 9, relating to flow of information and communications with stakeholders and the public, does the System have a strategic plan?  Can we obtain a copy to assist in the proposal preparation?

No strategic plan exists.

  1. On page 4, item 11, relating to audit findings, do you anticipate all elements of an audit finding be included in the final report?  Do you anticipate including management responses in the audit report?

No. Our choice of the term “audit” is unfortunate. We should probably have called the project a performance and financial assessment.

  1. On page 10, item 6.1, the contract term and start date is identified.  Is there a expected date for report delivery?

As indicated in an above response, we anticipate an overall project schedule of approximately one year.

  1. Do you anticipate additional performance and financial audits of the System being conducted under this contract arising from the results of the risk assessment?

Any future assessments will depend on findings of this assessment.

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