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SOW PUCT Rate Filing Services 11172020 finalCity of Denton, Texas Request for Qualifications #7532 Statement of Work A: INTRODUCTION The City of Denton (“City”) is requesting qualifications-based responses to contract with a Utility Consulting Firm (“Firm”), qualified and interested in providing consulting and representing services to Denton Municipal Electric (“DME”), with considerable experience in providing the professional, research, and operational services requested within this RFQ. The responses shall be submitted to the City of Denton in a sealed submission. The awarded Firm (s) shall have the ability to accomplish all aspects of the requested services. B: SCOPE OF WORK (“Services”) Task A - Rate Analysis and Filing a) Firm will review DME’s existing Transmission Cost of Service (“TCOS”) rates and revenues based on TCOS project additions and Public Utility Commission of Texas' (“PUCT”) reviews and report findings and provide strategies for TCOS rate filings and adjustments. b) Firm will gather, organize, and prepare all necessary documentation required to file an interim update of wholesale transmission rates package with PUCT on behalf of DME. The data used for this case filing shall be the net rate of return (after tax) used in last TCOS. If a non-investor owned utility (“Non-IOU”) did not file its last TCOS rate case using the rate of return method, then the rate of return used for the interim update shall be based on an imputed rate of return. The imputed rate of return will be calculated from the information filed in the previous TCOS case. The interim update of wholesale transmission rate package must be submitted with written testimony describing the analyses and results as required by the PUCT SUBST. R. § 25.192(g)(1) and the filing requirements for interim update of wholesale transmission rates pursuant to PUCT SUBST. R. §25.193(a)(1) I (the "Interim TCOS Filing Package") for Non-IOU transmission service providers in the Electric Reliability Council of Texas as adopted December 16, 1999 (Project No. 21276) (Interim-TCOS-RFP). c) Firm will gather, organize, and prepare all necessary documentation required to file a full rate filing package with PUCT on behalf of DME. The data for the case filing period is 2004 to November 2021, with a test year end September 30, 2020. The rate filing package must be submitted with written testimony describing the analyses and results as required by the PUCT Transmission Cost of Service Rate Filing Package for Non-Investor Owned Transmission Service Providers in the Electric Reliability Council of Texas as adopted December 16, 1999 (Project No. 21276) (TCOS Rate Filing). d) Firm will provide the scope of work in two phases: Phase 1: Initial development of both interim and full TCOS rate filings. 2  Phase 2: Support interim and full TCOS rate filing cases and hearing support. Task B PUC and Other Regulatory Activities Task B-1 - Attend PUC and Other Meetings as Required a) Firm will keep abreast of activities at the PUCT and will attend meetings, as directed by DME related to DME’s full rate case filing activities. b) Firm will participate in meetings, as necessary, to represent DME’s interests. c) Firm will participate in all required activities necessary to draft, complete and file a full rate case with PUCT. d) Firm will during the filing preparation and pendency of any interim and full TCOS filing, monitor PUCT orders and/or staff recommendations that have the potential to impact (positively or negatively) DME rate filings. Communicate routinely with DME on any information relevant under this task B. Task C - Working With Other Affected Parties Task C-1 -Work With Legal Counsel a) Firm will work with both DME in-house and outside counsel to draft, complete and file an interim and full rate filing packages with the PUCT on behalf of DME. Task D - Other Services a) Firm will assist DME with other analyses and project work as directed by DME. C: PROFESSIONAL SERVICE All professional services are to be performed under the direct supervision of an attorney licensed to practice law in the State of Texas. The City of Denton’s legal department, together with outside counsel, will be directing all work under this professional services contract. DME will give preference to respondents that have licensed Texas lawyers on staff. The services will meet or exceed the minimum standards of practice established by the State Bar of Texas. For the avoidance of doubt, all discussions with DME staff with Firm in the collection and preparation of any TCOS rate filing will be considered Attorney/Client Work product as all such work is associated with the development of the legal proceeding before the PUCT. The selected Firm must be registered by the State of Texas to provide services in the State. All fees and taxes are the responsibility of the offeror. Include copies of current licenses or certifications of any licensed Texas lawyers on staff at Firm. The Firm shall not substitute or replace any of its licensed Texas attorneys or any other major staff involved with this contract without the written acceptance by the City of Denton. The Firm agrees to provide the following services: 3  D: FIRM RESPONSIBILITIES In accordance with the requirements described in the Scope of Work, Firm is for, but not limited to, the preparing and finalizing the following:  A test year revenue requirement for the transmission system based on a 2020 test year which will be defined as the fiscal year for the City of Denton. Known and measurable adjustments will be made to the test year, as appropriate. The revenue requirement will be developed consistent with PUCT filing requirements.  Appropriate functionalization factors that assign and allocate costs related to the operation and maintenance expense, debt service, capital, and other expenses associated with the generation, distribution, and transmission functions. Functionalization factors will consider DME's operation and maintenance procedures, labor cost, plant investment, infrastructure design and use, voltage, and many other considerations. Functionalization factors will be developed consistent with PUCT guidelines.  Allocated TCOS for DME. This task includes the development of the comprehensive Microsoft Excel TCOS model, as well as schedules and work papers that will be submitted to the PUCT in support of the filing. All of the required functionalization factors, work papers, and supporting analyses required for the filing will be in the model and delivered to DME for future use and update for TCOS filings.  All schedules and work papers, as well as written testimony in support of the analysis, will be done in close coordination with DME and its legal counsel during this task. Firm will write and sponsor a significant to majority of the testimony and a majority of the exhibits. The testimony will also include development of the DME tariff. E: DENTON MUNICIPAL ELECTRIC (DME) RESPONSIBILITIES: a) DME will provide for Firm selected to perform the Project one (1) hard-copy set of all applicable DME technical instructions and standards that are not readily accessible and available over the internet. During the contract period, any revisions or changes to these technical instructions and standards also will be provided. b) DME will designate personnel for coordination with Firm. c) DME also will be responsible for the following: (i) All pertinent engineering documentation regarding justification, design, and construction of transmission assets (ii) Any required historical financial data F: AVAILABILITY OF SERVICES Subject to the terms and conditions of the Agreement and this SOW, Firm shall use best-efforts to provide Services for eight (8) hours per day, five (5) days per week throughout the term of this SOW. Unless otherwise provided for herein, all work will be performed remotely and on-site at 4  DME’s locations in Denton, Texas during normal business hours, Monday through Friday, 8:00 a.m. – 5:00 p.m. central standard time, excluding DME, federal or state holidays. G: PROJECT SCHEDULE a) The Services identified in this Statement of Work will require continuous activity as determined by the PUCT rate filing deadline of November 2021 b) Upon completion or settlement of November 2021 full rate filling, interim filings (up to 2 per year) on an ongoing basis for term of the agreement H: LOCATION OF SERVICES Services shall be provided at the following locations: a) On DME premises ; b) Off-site; c) Remotely; and/or d) PUCT facilities, Austin, Texas. I: DELIVERABLES In addition to the Services, the firm shall deliver each of the following: a) Documentation of Application Process: Document the rate case filing process, including invoicing, as provided in the contractual requirements on a monthly report. b) Filing Progress Status Reporting: Provide DME monthly reports regarding the status/progress of rate case. c) Technical “White-Papers” or Other Studies: Provide DME technical assistance in the development of “white-papers” or other appropriate documentation. AS NEEDED. d) Routine or Periodic PUCT Developments: Provide DME with written reports and assessments consistent with Section B(d) above. J: ACCEPTANCE CRITERIA In addition to the requirements set forth in the Agreement, the Services and/or Deliverables shall be deemed acceptable provided that the Services are delivered in compliance with contractual requirements, other applicable DME technical instructions and standards, applicable laws, and regulations. K: ACCEPTANCE PROCESS Unless otherwise agreed by both parties in writing, DME will accept Deliverables following this process: a) Firm will present the Deliverables to DME for review and approval; b) DME will review the Deliverables and provide Firm feedback within ten (10) business days; c) Firm will revise the Deliverables and re-submit the updated Deliverables to DME within five (5) business days; and 5  d) DME will approve the Deliverables within ten (10) business days. L: PRICING STRUCTURE Firm is to invoice attaching entity for any work performed. Below is a table outlining compensation: The following Compensation Schedule is for Review Purposes Only. The Respondent is not to submit pricing information until requested by DME. M: SUMMARY OF QUALIFICATIONS Sealed qualifications will be accepted in IONWAVE in accordance with the minimum qualifications detailed in the solicitation. Interested firms must submit a summary of qualifications that showcases the Firm’s qualifications as outlined in this section and throughout the scope of work. The Firm shall submit all documents necessary to support its qualifications and include them in the submittal. Please include at a minimum the following:  A maximum three (3) page narrative as to the Firm’s interest, abilities and qualifications related to this project.  The location of your office where majority of the work on the project will be performed and the approximate number of employees in that office.  The Firm must provide proof that it possesses a licensed Texas attorney on staff as a minimum requirement.  Provide copies of current licenses or certifications of the lead licensed Texas attorney and any other licensed Texas attorney of the Firm that will be signing official documents.  Resumes of key personnel to be assigned to this project with an organizational chart.  Proof of a minimum of five (5) years of experience providing PUCT interim and full transmission cost rate filling services.  Documentation that demonstrates the Firm’s ability to perform work and to deliver reports within certain timelines  Provide one or more letters of evaluation from past clientele; and Deliverable Description Phase / Time Frame Compensation Description Interim Rate Case Filing Successfully review, draft, complete and submit an interim rate case based on information received from DME in accordance with PUCT requirements. Filing Deadline is July 2021 Time & Expense – Billed monthly Full Rate Case Filing Successfully review, draft, complete and submit a full rate case based on information received from DME in accordance with PUCT requirements. Filing Deadline is November 2021 Time & Expense – Billed monthly Technical “White- Papers” or Other Studies Provide DME technical assistance in the development of “white- papers” or other appropriate documentation. As requested DME Time & Expense – As required 6   Provide a sample report of the application progress with an emphasis on accuracy, legibility, neatness and organization.  A list and general description of each related project that the above-mentioned staff has performed that would indicate your Firm’s ability to perform the work being considered. At least five (5) project examples should be included. The list of specific projects shall indicate the professional services necessary to accomplish the project, along with your client’s name and phone number.  Additional points will be given to Firms possessing additional certifications/licenses/designations from applicable professional organizations and the ability of the Firm to provide all services in house (Firm must provide supportive documentation) The City encourages interested firms to review the 'Evaluation Procedures' section of this solicitation to, and to provide any information and documentation that would allow the City to evaluate the Firm's qualification. It is the Firm's responsibility to provide proof of qualifications, experience, etc.