GDS is uniquely positioned, by virtue of our expertise and continuing engagements in the privatization effort, to offer strategic, technical, financial, and other assistance to prospective bidders. The United States Government is committed to continuing the Utility Privatization effort at military installations around the country. Since the inception of the utility privatization initiative in 1997, our experienced staff of consultants, analysts, and engineers has provided a full range of services including:
- Monitoring Government Privatization Activity
- Responding to Government Requests for Expressions of Interest
- Strategy Consultation
- Review of RFPs Issued by Government
- Engineering Condition Assessment and Due Diligence (through Hi-Line Engineering, a division of GDS)
- Pro Forma Financial Analysis
- Full-Service/Turn-Key Proposal Development and Production
- Negotiation Support
- Implementation Assistance
- Contract Administration
- Price Redetermination
- Economic Price Adjustment
GDS has vast experience and knowledge of the Utility Privatization Industry, having submitted over 50 Proposals in 28 states since the program’s inception. Our team of highly qualified engineers, analysts, and project managers can assist your company with the following:
Utility Privatization Negotiation Support
GDS will ensure that your company isn’t exposed to financial, legal, and other risk throughout the term of your contract. GDS knows the intricacies of the proposals, the Government’s negotiation process, and the standard features of contracts to be awarded. GDS will add significant value to your winning proposal and assist in successfully negotiating the best contract with the Government.
Review Contracts for Awarded Systems
The legal implications of this contract are extensive, confusing, and, in many cases, may incorporate regulations that put your company at risk in future dealings with the Government. GDS will ensure your company is protected by incorporating the appropriate Federal Acquisition Regulations (FARs) and Defense FARs (DFARs) in your contract.
Pricing and Accounting Support
Significant attention is focused on the final pricing during contract negotiation. It is very likely that the Government will have different estimates on inventories, depreciation rates, schedule of useful lives, etc., all reflected in the Government’s “should cost”. GDS is experienced in working with the Government in developing the final pricing schedules to win the contract award.
Ongoing Negotiation Support
Utility Privatization contract awards are generally for a period of 50 years, during which operations, commitments, and required workloads will constantly be adjusting to the changing environment and missions that these utilities serve. With GDS, you can make sure your company is appropriately compensated, and your contract is appropriately amended. GDS can identify areas where cost savings can occur, and how to handle changes in the scope of work. The Government recently required that the service charge for all new Air Force privatization contracts be adjusted on an annual basis via Economic Price Adjustment. GDS can advise your company of the best approach to take with respect to Economic Price Adjustment. Many existing contracts still utilize the Price Redetermination option for pricing adjustments. Price redetermination typically occurs every 2-3 years throughout the life of a UP contract. GDS can evaluate and advise on the best approach for your company in developing a price redetermination proposal and during the price redetermination negotiations.
Implementation (Transition to Privatization) Assistance
Now that your company has been awarded the privatization contract, the next step is to immediately begin planning the transition phase, during which your company will take over full ownership and operations of the utility system. GDS offers a range of transition assistance, ranging from general guidance to a complete turnkey transition services. Implementing all commitments of the proposal and contract can be daunting and labor intensive, pulling your management and operations resources from their primary responsibilities. If not managed effectively, this process can be detrimental to your company. GDS offers options that allow you to choose to have a GDS project manager on-site to guide in operational startup, or you could choose to utilize our services on an “as needed basis”. GDS allows you to determine the level of support during the transition phase.
Contract Administration
Once successfully awarded, the winning privatization contract must be managed in accordance with the contract requirements, as specified in the final award. There is often significant reporting and information management required for compliance. GDS offers assistance to ensure successful compliance with your contract’s deliverables. In addition to ensuring that your company is compliant with the Government’s requirements, our systematic approach allows you to monitor your deliverables and commitments to the Government.
Price Redetermination
Every 2 -3 years, throughout the life of the contract, you will have the opportunity to negotiate with the Government for modifications to the price paid to your firm. How will you know that your charge is still accurate for the scope of work being performed? GDS can conduct a professional audit of your recordkeeping, financial, and operations data and proposal requirements. It very well may be that you are eligible for a price adjustment. GDS will determine the appropriate approach to take during redetermination negotiations.
Economic Price Adjustment
The Government has required Contractors to propose an Economic Price Adjustment (“EPA”) pricing model on recent RFP’s. This is different from Price Redetermination in that pricing adjustments occur on an annual basis and are driven by a specified price index. GDS can help navigate through this process in determining the most applicable index per the unique characteristics of the utility system you are proposing to acquire.
Pricing Adjustments due to Change in Inventory or Scope of Work
Was your pricing based on an assumption that turned out to be inaccurate? Did you discover additional inventory during the Transition Phase that was not listed in the Government’s records? Has the scope of your contract changed? GDS can help negotiate a new charge to the Government in accordance with appropriate Government regulations for equitable adjustments, differing site conditions, and changes in the scope of work to be performed. GDS will work with you until your company receives proper compensation for the work done on the military electric distribution system.
Contract Engineering Support
Throughout the negotiation process, and into the operational phase of system ownership, your company will have a variety of engineering needs. GDS has a rich history of assisting clients with the following:
- Inventory and Due Diligence assessments
- Overhead Distribution Line Design and Staking
- Underground Distribution System Design
- GIS/GPS Mapping of utility systems according to Military standards
- Right or Way / Vegetation maintenance
- Pole testing
- Infrared testing
- Training and Certification Services
- Other Specialized Design services
Typical Clients
- Electric Cooperatives
- Municipal Electric Systems
- Investor-Owned and Municipal Water/Wastewater Utilities
- Natural Gas Utilities
GDS has successfully assisted clients throughout the country in their efforts to acquire the electric, gas, water distribution systems and wastewater collection systems, formerly owned by Department of Defense Installations.
Electric Distribution Consulting Services
Through Hi-Line Engineering, a division of GDS, we specialize in planning, mapping, and design services to the electric utility industry throughout the United States. We provide high-quality, personal service to rural electric cooperatives, municipal electric systems, and investor-owned utilities in support of Utility Privatization contracts. Specifically, our privatization services include:
- Inventory and Valuation
- Condition Assessment
- Development of O&M and Capital Improvement / Replacement Plans
- Due Diligence Reviews
Our team of engineers and consultants has analyzed and prepared proposals for more than 50 military electric distribution systems. Our understanding of the key issues in Utility Privatization has lead to an outstanding record of success in achieving contract awards. With the highly skilled preparation and examination given to the study of each electric system, our clients are assured of an accurate condition assessment, fair purchase price, and reasonable replacement schedule over the 50 year utility privatization contract.
Natural Gas Consulting Services
GDS is experienced in the privatization of natural gas utility systems on military installations throughout the country. Our team of highly qualified professionals works to address complex economic, engineering, accounting, and regulatory issues associated with Utility Privatization. Specifically, our services include:
- System Valuations including Replacement Cost New Less Depreciation, and Original Cost Less Depreciation
- Pro Forma Financial Analysis
- Contract Engineering Support
- Full-Service Proposal Development and Production
- Implementation Assistance and Contract Administration
- Price Redetermination
GDS understands the diverse needs of gas systems and end users. We provide comprehensive and technical assistance to meet our clients’ operating and regulatory demands and help enhance their operations, increase efficiency, and minimize costs for privatization contracts.
Water & Wastewater Utility Consulting Services
GDS leverages years of expertise in water and wastewater utility management to assist our clients in developing and supporting successful Utility Privatization contracts. It takes a thorough understanding of water and wastewater utilities, as well as the privatization process, to develop proposals, and successfully negotiate and administer contracts. Our water and wastewater professionals are uniquely qualified in these areas and are able to address the complex engineering, accounting, economic, management, operational, regulatory, and policy issues that concern our water and wastewater privatization clients. Our wide base of clients, including municipalities, investor-owned utilities, water districts, non-profit customer-owned systems, and government agencies, have given us the experience and allowed us to develop capabilities that encompass the broad areas of utility management, regulatory services, and hydrology, in addition to significant experience in Utility Privatization. Water and wastewater services related to Utility Privatization include:
- System Valuations including Replacement Cost New Less Depreciation, and Original Cost Less Depreciation
- Pro Forma Financial Analysis
- Contract Engineering Support
- Full-Service Proposal Development and Production
- Negotiation Support
- Implementation Assistance and Contract Administration
- Price Redetermination
- Valuation of Inventory
GDS understands the diverse needs of gas systems and end users. We provide comprehensive and technical assistance to meet our clients’ operating and regulatory demands and help enhance their operations, increase efficiency, and minimize costs for privatization contracts.