REQUEST FOR PROPOSAL Management Services

July 16, 2015

This Request for Proposal (RFP) is made available to qualified/capable Reverse Auction Management Service Providers. The Northeast Ohio Regional Sewer District (District) is seeking Statements of Qualifications and competitive sealed Proposals via this Request for Proposal (RFP) for provision of Reverse Auction Management Services for the of Wholesale Natural Gas. If an acceptable Proposal is made in response to this RFP, the District may authorize the selected Proposer to perform the services. Once selected, the term of the service will begin on the date the contract is awarded, and be in place for the duration the wholesale natural gas procurement contract.

RFP Issued: July 16, 2015 Non mandatory pre –proposal meeting: July 22, 2015 Inquiry addendum deadline: July 25, 2015 Proposal due date: July 30, 2015 Contract Award: Aug 6, 2015

The RFP is organized as follows:

SECTION 1 – GENERAL INSTRUCTION SECTION 2 – SCOPE OF SERVICE SECTION 3 – PROPOSAL CONTENT AND FORMAT SECTION 4 - EVALUATION AND SELECTION PROCESS

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SECTION 1 ~ GENERAL INSTRUCTIONS

1.0 Proposal Delivery, Time and Date

Proposals for providing these services will be accepted until the close of business (4:30 P.M.) on July 30, 2015. The official time shall be as stated on the atomic time stamp clock designated as the official clock located at the District’s Security Desk at the George J. McMonagle Administration Building. Late submittals will not be considered. Proposals not meeting the requirements of this RFP may be deemed non-responsive at the sole discretion of the District. A non-mandatory pre-proposal meeting will be held at 9:00A.M. on July 22, 2015 in the George J. McMonagle, Public Meeting Room, 3900 Euclid Avenue, Cleveland, Ohio.

Proposals are to be delivered to the following name and address:

Jennifer Demmerle, CPA, Chief Financial Officer Northeast Ohio Regional Sewer District 3900 Euclid Avenue Cleveland, OH 44115-2506

1.2 Proposal Submissions

Proposers are requested to submit three (3) copies of their information packet. Proposers must include their company name and address on the outside of the envelope or container. The envelope or container must be sealed. The words RFP for Reverse Auction Management Services RFP# P1212 must appear on the outside of the envelope or container. Proposals will be accepted in person, by U.S. Mail, by UPS, or by private courier service. NO Proposals will be accepted via oral or e-mail communication, telephone, facsimile, or telegraphic transmission. 1.3 Clarification

Questions regarding this RFP shall be directed to Jacqueline Williams at the pre- proposal meeting or at other times by e-mailing to [email protected]. It shall be the proposer’s responsibility to advise the purchasing agent if any language, requirements, or any combination thereof, inadvertently restricts or limits the requirements stated in this RFP to a single source. Such notifications must be submitted

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in writing and must be received by the District’s Manager of Procurement Services no later than July 24, 2015. A review of such notification will be made.

All requests for additional information or clarification concerning this Request for Proposal (RFP) must be submitted in writing by 4:30 p.m., July 24, 2015 addressed to:

Jacqueline Williams, Manager of Procurement Services Northeast Ohio Regional Sewer District 3900 Euclid Avenue Cleveland, OH 44115-2506 [email protected]

1.4 Addenda and Modifications Any changes, additions, deletions, or clarifications to the RFP are made by the District through amendments (addenda). Any proposer in doubt as to the true meaning of any part of the RFP documents may request any interpretation thereof from the Division of Purchasing and Supplies. At the request of the proposer, or in the event the Purchasing Department deems the interpretation to be substantive, the interpretation will be made by written addendum issued by the Purchasing Department. Such addendum issued by the Purchasing Department will be sent to all proposers receiving the original Request for Proposal (RFP) and will become part of the proposal package having the same binding effect as provisions of the original RFP. No verbal explanations or interpretations will be binding. In order to have a request for interpretation considered, the request must be submitted in writing and must be received by Manager of Procurement Services by July 24, 2015. All Addenda, amendments, and interpretations of this solicitation shall be in writing. Any amendment or interpretation that is not in writing shall not legally bind the District. Only information supplied by the District in writing or in this RFP should be used in preparing proposal responses. All contact that a proposer may have had before or after receipt of this RFP with any individuals, employees, or representatives of District regarding this RFP should be disregarded in preparing responses. The District does not assume responsibility for the receipt of any addendum sent to proposers. A copy of all addenda issued must be signed and returned with your proposal.

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1.5 Examination of Documents and Requirements Each proposer shall carefully examine all RFP documents and thoroughly familiarize themselves with all requirements prior to submitting a proposal to ensure that the proposal meets the intent of this RFP. Before submitting a proposal each proposer shall be responsible for making all investigations and examinations that are necessary to ascertain conditions and requirements affecting the requirements of this RFP. Failure to make such investigations and examinations shall not relieve the proposer from obligation to comply, in every detail, with all provisions and requirements of the Request for Proposal.

1.6 Conflict of Interest The proposer shall not accept gifts or anything of value nor enter into any business arrangement with any employee, official or agent of the District. By signing their proposal, the proposer certifies and represents to the District that the proposer has not offered, conferred or agreed to confer any pecuniary benefit or other thing of value for the receipt of special treatment, advantaged, information, recipient’s decision, opinion, recommendation, vote or any other exercise of discretion concerning this RFP. 1.7 Proposal Preparation Costs Issuance of this RFP does not commit the District, in any way, to pay any costs incurred in the preparation and submission of a proposal. The issuance of this RFP does not obligate the District to enter into contract for any services or equipment. All costs related to the preparation and submission of a proposal shall be paid by the proposer.

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SECTION 2 ~ SCOPE OF SERVICE

2.1 Objective

The District is interested in contracting with a Reverse Auction Management Service Provider for the Procurement of Wholesale Natural Gas. The objective of this RFP is to solicit Proposals to engage the services of a knowledgeable Reverse Auction Management Service Provider in the field of wholesale natural gas, load management and procurement services. The District’s annual natural gas usage during the last two (2) year contract was 1,416,320 Dths. The Reverse Auction Management Service Provider will be responsible for the development and support to provide a wholesale natural gas strategy that will maximize cost savings while providing management reports on the program and any savings.

The Reverse Auction Management Service Provider will perform many of the administrative functions under the direction of District including usage analysis, development of a buying strategy, development of a load management strategy, proposal preparation, and reporting. The Reverse Auction Management Service Provider must not be affiliated with any particular wholesale natural gas or marketer, and must act impartially with regard to providers and in the best interest of the District. Therefore, if a wholesale natural gas supplier or affiliated company submits a proposal under this RFP and is selected to provide reverse auction management services, that supplier may not bid to supply wholesale natural gas to the District in response to the Invitation to Bid developed with the auction management service.

This RFP provides details on what is required to submit a Proposal, how the District will evaluate the Proposals and what will be required of the Proposer who is selected to provide Reverse Auction Management Services.

Scope of services:

Performance -The Reverse Auction Management Service Provider shall:

1. Work with the District to gather historical usage data. 2. Work with the District to develop risk management goals. Such goals will be used to guide the procurement process and the wholesale natural gas supplier selection. 3. Develop a supply strategy that adheres to the risk management goals, generates the most competitive bids, reduces the District's exposure to capacity costs and distribution/transmission riders, and positions the District to monetize demand response opportunities. 4. Conduct a survey of active and licensed competitive wholesale natural gas suppliers as certified by the Public Utilities Commission of Ohio to ensure maximum supplier participation. 5. Provide information regarding the best time to hold the procurement based on District's specified timelines and market conditions.

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6. Solicit qualified suppliers for wholesale natural gas that meet the objectives of the supply strategy. 7. Provide training and instruction to the qualified suppliers on how to bid using the reverse auction technology/tools. 8. Conduct the auctions. 9. Create baselines (current budget and avoided costs) against which supplier bid prices are compared to ensure that selected offer adheres to supply strategy goals. 10. Review the final contract to ensure that it meets both District's and supplier's requirements. 11. Facilitate contract negotiations, if necessary, between the District and supplier. 12. Provide the District with its market expertise, information, and recommendations throughout the process to make informed decisions and as requested by the District. 13. Perform all work on a no upfront cost basis. The Reverse Auction Management Service Provider will be reimbursed by the winning wholesale natural gas supplier at a rate based upon a per Dths basis over the life of this Contract for all accounts awarded as a result of services provided. Fees paid will be based on the amount of actual Dths used. 14. Be on notice that if a supply contract is not executed, the District will be under no obligation to compensate the selected Reverse Auction Management Service Provider for services rendered.

2.2 Cost to the District

The District will give preference to Reverse Auction platforms in which the District is not charged any fees. Platforms in which the supplier (s) being awarded the contract through the reverse auction process bear the cost of the services, are preferred.

2.3 Reporting - The Reverse Auction Management Service Provider shall:

1. Develop reports that include, but are not limited to, measurement of program performance including historic wholesale market trends, historic usage trends, natural gas costs that were avoided by using the reverse auction process, and budget forecasts of total spend. In addition, the Reverse Auction Management Service will be required to work with District’s contract manager, to ensure maximum value derived from that program, and to provide support to that team for the development of a report on District performance and value derived from that program. 2. Verify the accuracy of all account information at the start of this Contract, maintain and verify the accuracy of all account record on an annual basis thereafter. 3. Meet in person with the District contract manager as requested, and by phone at least quarterly. 4. Prepare other reports and attend meetings as may be determined necessary by the successful Proposer and District contract manager.

2.4 Authorization

The District will provide the Reverse Auction Management Service Provider with a Letter of Authorization (LOA) form and recent incumbent natural gas invoice for each natural gas account that is eligible for procurement services.

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SECTION 3 ~ PROPOSAL CONTENT AND FORMAT

Each proposal must include sufficient information to allow the evaluation committee to verify all aspects of the Proposal meet the RFP’s requirements. Each Proposal must respond to every in this RFP. These instructions describe the required format for a responsive Proposal. All required specifications must be met for the Proposal to be considered responsive

The Proposer may include any additional information it believes is relevant. All pages, except pre-printed technical inserts, must be sequentially numbered.

Each Proposal shall be organized in the following order and shall contain the following information in order to be considered responsive.

3.1 Cover Letter

The Proposer must include a business letter signed by an individual authorized to represent the Proposer. The Proposer must be engaged in the business of providing Reverse Auction Management Services. The letter must include the following:

1. General company profile including a description of the Proposer’s legal structure (e.g. corporation, partnership, etc.) and number of employees 2. The address of the Proposer’s home office 3. The name, telephone number, fax number and electronic-mail address of a contact person who has authority to answer questions regarding the Proposal and receive notices following contract award.

3.1 Technical

Provide a technical description of your proposed solution. The system (s) provided by proposer must be platform independent and comply with all applicable industry standards.

3.2 Functional

Provide a description of the functionality provided by your proposed solution. The District is interested in solutions that provide flexibility in how a reverse auction can be conducted. The following functionality is preferred:

1. Ability to structure an auction for various pricing scenarios 2. Ability for public viewing of the auction 3. Ability for the District to view the supplier bidding without the suppliers knowing who is bidding 4. Provide auction detail and summary detail and summary data 5. Detailed reporting and records in both paper and electron formats of all bidding-related events and their timing during the reverse auction, including the connectivity of suppliers participating 6. Immediate assessment of the bid scenarios along with recommendations for award 7. Prior to the start of the on-line bidding event, the District contract manager and CFO

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shall receive a list of all pre-registered bidders through e-mail 8. The District contract manager shall have access to view an on-going on-line bidding event, during the bidding event 9. The District contract manager and CFO shall receive a preliminary list of the bidding history through e-mail within (1) hour of the completion of the bidding event 10. Prior to submitting information through e-mail as required above, the awarded proposer shall confirm the actual e-mail addresses to which the District and the CFO wish the information to be disseminated.

3.3 Reliability/Uptime Provide information about the reliability of your proposed solution. The District intends to give preference to proposals which provide for guaranteed reliability or the auction will be at no cost to the District in addition to being re-auctioned at a later time. Where applicable please include information about such issues as: 1. Backups 2. Dual-paths, redundant systems 3. Uptime statistics 4. Disaster Recovery 5. Application stability – “stress-test” statistic, concurrent users supported, etc.

3.4 Implementation Time

Provide information about the average implementation time that it would take for the District to use your service(s). 3.4 Security

Provide information about the security of your proposed solution. The proper handling of information regarding the procurement of millions of dollars worth of products and services and the assured integrity of the bidding process are of paramount importance to the District and require a very high level of security. Where applicable please include information about such issues as explained in the following, 3.6 through 3.12. 3.5 Confidentiality Proposer acknowledges that some of the data it may become privy to in the performance of this Agreement is of a confidential nature and the awarded supplier shall make all reasonable efforts to ensure that no such confidential information is disseminated or left exposed to unauthorized access by it or its employees.

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3.6 Secure Storage/Transmission of Data All auction data transmitted over the internet must be through and encrypted transmission, such as 128-bit Secure Sockets Layer (SSL) encryption. All proposer’s systems used in conjunction with providing the service to the District shall be protected by industry standard devices (e.g. firewalls) and continuously monitored for unusual access activities using industry standard intrusion detection software and procedures. 3.7 Secure Physical Locations Any information and/or data obtained by the proposer from the District, District’s customers, or District suppliers shall be stored in a place physically secure from access by unauthorized persons. Awarded proposer shall take every reasonable precaution to ensure that all buildings, rooms, storage areas, and containers (“physical locations”) used by proposer in providing the product(s) and service(s) under the awarded contract shall be secure and equipped with reasonable precautions against damage. 3.8 Support Services Provide information about the technical and non-technical support features, both to the District and to the District’s suppliers, of your proposed solution. Where applicable please include information about such issues as:  Training  Consulting  Technical Support  Help Desk  Maintenance  Implementation and migration services  Account Representatives  Assistance in developing marketing plans/materials for reverse auctions to state agencies, local units of government, and potential sellers.

3.9 Buyer Experience Each proposer must submit a list of three (3) customer references and three (3) local (County, City, Municipality, etc.) government agencies that have contracted with the proposer for reverse auction services on at least one (1) occasion in the past twenty-four (24) months. Reference listing should include the mailing address, email address, telephone numbers and the name of individuals to contact. Proposer shall have acceptable experience of successfully providing the services described in this RFP to clients whom have similar requirements,

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scope of service(s), and quantities as those of the District. The District shall be the sole judge as to what is acceptable experience. 3.10 Seller Experience Each proposer must submit a list of three (3) customer references from sellers who placed bids using the proposer’s reverse auction software on at least one (1) occasion in the past twenty-four (24) months. Reference listing should include the mailing address, email address, telephone numbers and the name of individuals to contact. Proposer shall have acceptable experience of successfully providing the services described in this RFP to clients whom have similar requirements, scope of service(s), and quantities as those of the District. The District shall be the sole judge as to what is acceptable experience. 3.11 Staffing of Project a. Proposed organizational chart for the service. b. Description and responsibilities for all proposed staff. c. Names and experience of key staff proposed. (Be specific). Resumes acceptable. d. Provide sufficient data to lead evaluators to the conclusion that your firm has the financial capability to perform. (income statement, balance sheet suggested).

3.12 Exhibits

Exhibit A- Proposed Fee: Be sure to indicate the fee per Dths in the blank provided.

Exhibit B -Proposer Qualifications and Performance Summary: This Exhibit consists of a listing of mandatory qualifications and the listing of current customers and shall include a Statement of Compliance. The Proposer shall include a paragraph stating that they are able to comply with all mandatory qualification requirements included in Exhibit B.

Exhibit C - Conflict of Interest Statement: Each Proposal shall include a statement indicating whether the Proposer, or any people that may provide services through the Proposer, have a possible conflict of interest, direct or indirect, which is incompatible with the provision of services. The District has the right to reject a Proposal in which a conflict is disclosed or remove authorization to provide services if any interest is later discovered that could give the appearance of a conflict.

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SECTION 4 ~ EVALUATION AND SELECTION PROCESS

4.1 Evaluation of Proposals The evaluation process will consist of three phases:

1. Responsiveness: Initial review for defects and evaluation of presented services (10%) 2. Qualifications: Evaluation of Proposer’s qualification/experience level and past performance (50%) 3. Fee: Proposal Fee Evaluation (40%)

An Evaluation Committee consisting of District subject matter experts or their designees will evaluate the proposals, and retain the right to eliminate or add phases if the Committee believes do so will improve the evaluation process.

4.2 Rejection of Proposals

1. The District may reject any Proposal for material deviation from the required format and the Proposal instructions. 2. The District shall reject any Proposal that does not meet any of the following mandatory requirements:

a. The Proposal does not address material requirements of the RFP. b. Proposal must be submitted on or before the Proposal Due Date and to the proper address. c. Additionally, the District may cancel this RFP, reject all the Proposals, and seek services through a new RFP or other means. If a Proposal is not rejected pursuant to the above criteria, then the Evaluation Committee shall review it.

4.3 Clarifications & Corrections: During the evaluation process, The District may request clarifications from any Proposer under consideration. Also, the Proposer may be given the opportunity to correct defects in its Proposal if the District believes doing so does not result in an unfair advantage for the Proposer and it is in District’s best interests.

4.4 Proposer Qualification Determination The Evaluation Committee will review the Proposer's compliance with the minimum qualification requirements as stated in Exhibit B, for providing the District with the services.

4.5 Proposer's Current Customers/Performance The Evaluation Committee may conduct evaluations of each Proposer by contacting current customers of the Proposer as submitted in Exhibit B. This will aid in the determination of whether the Proposer is responsible. The Evaluation Committee may

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obtain information relevant to the requirements of this RFP that is deemed critical not only to providing services, but also to the working relationship between District and the Reverse Auction Management Service Provider.

To maintain quality assurance in this phase of the evaluation process, all information sought by the Evaluation Committee shall be obtained in a manner such that no Proposer is provided an unfair competitive advantage. The Evaluation Committee has the right to determine the number of contacts made by the Evaluation Committee to ensure whether or not the Proposer can meet the minimum requirements of this RFP.

4.6 Interviews and Presentations

The Evaluation Committee may require Proposers to participate in an interview, or make a presentation about the Proposal. Such presentations and interviews provide a Proposer with an opportunity to clarify its Proposal and to ensure a mutual understanding of the RFP content. This phase shall be scheduled at the convenience and discretion of the Evaluation Committee. This phase is not an opportunity for any Proposer to engage in any negotiations over the form of the Proposal or requirements of this RFP.

4.7 Financial Ability

If the Evaluation Committee is concerned that a Proposer may have insufficient financial wherewithal to perform the Contract, it may require that a Proposer submit financial statements (i.e. financial statements audited by independent, certified public accountant) for the past three (3) years. This is not an essential element of the initial evaluation phase, but may be requested at any time. If the Evaluation Committee finds that the Proposer's financial ability is not acceptable, it may reject the Proposal despite its other merits. Such financial information may be submitted under confidentiality.

4.8 Miscellaneous

Any information submitted in response to this Proposal, including any appropriate descriptions of services and value-added services, may become part of the final Contract.

The Evaluation Committee shall document all major evaluation decisions in writing, and make these a part of the Proposal file along with the evaluation results for each Proposal.

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Exhibit A- Proposed Fee

(Complete this Exhibit and submit it with your Proposal)

During the term of the contract and any subsequent extension, the maximum fee for all services rendered as the result of the contract shall not exceed: /Dths of the natural gas consumed by the District eligible accounts. This fee does not apply to Dths lost during the transmission of natural gas.

Signature:

Date:

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Exhibit B- Proposer Qualifications and Past Performance

(Complete this Exhibit and submit it with your Proposal)

Please indicate yes or no in each column.

For Requirements that indicate proof is required, Proposer shall attach the documentation. In the event the documentation IS confidential, please mark each page that is confidential as such. Listings or copies with customer names redacted are appreciated; the District reserves the right to request additional proof in the event the information submitted is insufficient. The proof must be historical (i.e., not created simply for this RFP evaluation).

MANDATORY QUALIFICATION REQUIREMENTS Yes or No?

# Description

1 Proposer has proof that it is PUCO licensed to the perform services listed herein as of the Proposal due date.

Proposer has proof of having had no valid PUCO complaints over the 2 last two (2) years. If one (1) valid complaint exists, provide your experience and the outcome in solving the issue.

3 Proposer has proof of procurement services with a customer(s) in the geographic region and volume profile similar to the District. (One or more required.)

4 Proposer has proof of analytical tools and reports including avoided costs, year over year savings and projected budgets.

5 Proposer has proof of experience with a customer(s) in providing strategies to mitigate capacity costs in the same geographic region as the District.

6 Proposer has proof of past or current agreements with a robust amount of active qualified suppliers in the relevant District region.

7 Proposer has proof of being up to date with local wholesale gas providers.

8 Proposer has proof of developing a supply strategy with a customer in the geographic region and volume profile similar to the District.

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Exhibit B - Proposer Qualifications and Past Performance continued (Complete this Exhibit and submit it with your Proposal} The Proposer must provide the following information for this section for the past five (5) years, unless otherwise specified. Complete this form by indicating "yes" or "no'' in each column.

If the answer to any item is "yes", the Proposer must provide complete background details about the matter. While an affirmative answer to any of these items will not automatically disqualify a Proposer from consideration, at the sole discretion of the Evaluation Committee, such an answer and a review of the background details may result in a rejection of the Proposal. The Evaluation Committee will make this decision based on its determination of the seriousness of the matter, the matter's possible impact on the Proposer's performance on the Project, and the best interests of the District. PAST PERFORMANCE Item Description Yes or No?

The Proposer has had a Contract terminated for default or cause. If so, the A Proposer must submit full details including why, the other party's name, address, and telephone number.

The Proposer has been assessed any penalties in excess of five thousand dollars ($5,000), including liquidated damages, under any of its existing or past Contracts with any organization (including any governmental entity). If so, the B Proposer must provide complete details, including the name of the other organization, the reason for the penalty, and the penalty amount for each incident.

The Proposer was the subject of any governmental action limiting the right of the C Proposer to do business with that entity or any other governmental entity.

Trading in the stock of the company has been suspended. If so, the Proposer must D submit full details including the date(s) and explanation(s).

The Proposer, any officer of the Proposer, or any owner of a twenty percent

(20%) interest or greater in the Proposer has filed for bankruptcy, reorganization, E a debt arrangement, moratorium, or any proceeding under any bankruptcy or insolvency law, or any dissolution or liquidation proceeding.

The Proposer, any officer of the Proposer, or any owner with a twenty (20) F percent interest or greater in the Proposer has been convicted of a felony or is currently under indictment on any felony charge. For all current customers for whom the Proposer provides Electricity Broker and Related Services, the Proposer shall attach a list of current customers and a contact name and telephone number for each contact person. Submit the said list with your Proposal. By providing this information, Proposer agrees to allow the District’s Evaluation Committee or their designees the right to contact these customers to ask questions regarding Proposer's performance on existing engagements. CONFIDENTIAL

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Exhibit C- Conflict of Interest

The Reverse Auction Management Service Provider must not be affiliated with a particular natural gas supplier or marketer, and must act impartially with regard to providers and in the best interest of the District. Therefore, if a natural gas supplier or affiliated company submits a proposal under this RFP and is selected to provide reverse auction services, that supplier may not bid to supply natural gas to the District in response to the RFP developed with the Reverse Auction Management Service Provider.

By signing this exhibit, the Proposer is indicating compliance with the District’s conflict of interest requirements:

Signature:

Date:

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END OF RFP

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