TRANSMITTAL LETTER FOR BOARD MEETING OF DECEMBER 6, 2012
COMMITTEE ON PROCUREMENT
Mr. David St. Pierre, Executive Director
Title
Issue a purchase order and enter into an agreement with Quarles & Brady LLP (Quarles) to represent the District's interest in the ComEd appeal of the delivery rate proceeding before the Illinois Commerce Commission (ICC) as a member of the REACT Coalition, and participate in settlement discussions to remedy the estimation method used by ComEd in their Embedded Cost of Service Study (ECOSS) and to participate in discussions of the ComEd Efficiency Program, in an amount not to exceed $26,000.00, Accounts 101-67000/68000/69000-612150, Requisition 1351616
Body
Dear Sir:
On April 3, 2008, the Board of Commissioners authorized the Director of Procurement and Materials Management to issue a purchase order and enter into an agreement with DLA Piper US LLP (DLA Piper), to represent the District's interest in the ComEd delivery rate proceeding before the Illinois Commerce Commission (ICC) as a member of the REACT (Request Equitable Allocation of Costs Together) Coalition, in an amount not to exceed $75,000.00. REACT members consists of large commercial, industrial and municipal energy users.
The Board of Commissioners subsequently approved several increases in the amount of $226,000.00 to the original contract value of $75,000.00. The current contract value is $301,000.00. The REACT recently changed its legal representation from DLA Piper to Quarles and Brady LLP to handle the ComEd Rate case to resolution and to address concerns with the inequitable ComEd Efficiency Program.
The purchase order with DLA Piper enabled the District to participate as a member of REACT in the new rate case, 10-0467, which arose out of the original rate case, 07-655. REACT's efforts have thus far delayed and reduced the rate increase and have resulted in approximately $2,400,000.00 in annual savings for the District since 2008.
At this time, the District requests authorization for a new purchase order and agreement with Quarles and Brady LLP so the District may continue its relationship with REACT and complete the appeal process with related settlement discussions for the ICC's "Non Formula" rate case and also potentially finalize the new requested rate to minimize future costs to the District. As an accommodation to REACT, the firm has proposed a discounted hourly rate schedule for partners Christopher Townsend and Christopher Skey of $595.00 and $495.00, respectively. Other personnel under their supervision will be billed at the standard rates. As was the case in the past, monthly invoices will be apportioned amongst all REACT members based upon energy usage.
Additionally, REACT has requested that Quarles and Brady LLP initiate discussions with ComEd to voice concerns and suggest improvements to the ComEd Energy Efficiency Program as it relates to large electricity users. The ComEd Energy Efficiency Program raises funds from users to pay for efficiency improvement projects and has financed many projects for residential and commercial users. The program has been underutilized for large electrical customers. REACT hopes to improve the program administration and increase the number of funded efficiency projects. The District pays approximately $1,000,000.00 into this program annually.
As Quarles and Brady LLP has now been designated as the attorney for REACT and the District is of the opinion that participation in the REACT Coalition has been of beneficial value and further, because the law firm possesses a high degree of professional experience and skill, such action may be taken without competitive bidding in accordance with Section 11.4 of the Purchasing Act.
It is hereby recommended that the Director of Procurement and Materials Management be authorized to issue a purchase order and enter into an agreement with Quarles and Brady LLP in an amount not to exceed $26,000.00 and that the Chairman of the Committee on Finance, Executive Director, Clerk and Director of Procurement and Materials Management be authorized to enter into an agreement with Quarles and Brady LLP to perform the aforementioned legal services for the MWRD after same is approved by the General Counsel as to form and legality.
Funds are available in Accounts 101-67000/68000/69000-612150 and are contingent on the Board of Commissioners' approval of the District's budget for 2013.
Requested, Manju Prakash Sharma, Director of Maintenance and Operations, SES:SO'C:MAG:LSC:RSE
Recommended, Darlene A. LoCascio, Director of Procurement and Materials Management
Respectfully Submitted, Barbara J. McGowan, Chairman Committee on Procurement
Disposition of this agenda item will be documented in the official Regular Board Meeting Minutes of the Board of Commissioners for December 6, 2012.