The Following Article is Reprinted, with Permission, from Public Works Financing
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 Bergen County, N.J., Wastewater RFP

The Bergen County Utilities Authority (BCUA) issued an RFP to three finalists in late November for a 5, 10 or 15-year service agreement to operate, maintain and manage its regional wastewater treatment system, serving a densely packed population of 500,000. Billing and collections are not included. But the RFP, prepared by consultant Malcolm Pirnie Inc., allows firms to bid with or without offers for sludge disposal.

Proposals are due February 26 from United Water Services, Professional Services Group and Operations Management International. United Water is half-owned by Suez Lyonnaise des Eaux and United Water Resources, an investor-owned water company that serves most of the communities in BCUA’s northern New Jersey territory. CH2M Hill’s OMI has operating contracts in Hudson County, N.J., and Connecticut.

According to BCUA Acting Director Jerome Sheehan, the Little Ferry-based authority billed its 46 municipal and 19 private clients $36 million this year for wastewater services. Of that, $16 million was for debt service, which will continue to be paid by the authority. Each municipality handles its own billing and collections.

The private wastewater operators’ bids will include a staffing plan. Local 534 of the Utility Workers of America, which represents the authority’s 200 wastewater system employees, would be offered the first right of refusal on those jobs. BCUA also handles solid waste disposal in the region.

A 1992 report by the State Commission of Investigation called the BCUA a "patronage mill" that wasted millions of dollars of public money in the 1980s. A December 1995 report, compiled by a committee headed by former New Jersey Attorney General Cary Edwards, concluded that up to $16 million a year could be saved by privatizing the wastewater arm of the authority. The report cost about $125,000 and came out three months after the authority laid off 95 employees, about 25% of its work force.

A $425,000 study done in 1997 by Raftelis Financial Consulting evaluated a number of alternatives, including leasing or selling the treatment system.

After rejecting those options, BCUA’s board hired Malcom Pirnie late in 1997 to help improve the authority’s competitiveness. The consultants are being paid about $750,000 for preparing an automation master plan, drafting the RFP and evaluating the private proposals against a bench-marked public operations plan. Sheehan says BCUA’s residual costs will be added to the private bids before comparisons are made.