EVALUATION AND SELECTION PROCESS

5.1 Evaluation Process. Unless otherwise specified in a particular RFP, the Project Committee will subject Proposals submitted under an RFP process to the following three-phase evaluation, selection and negotiation process, as applicable. All Proposals, evaluations, discussions and negotiations will be kept confidential throughout the evaluation, selection and negotiation process until the signing of the Contract, subject to the provisions of this Regulation: (a) Phase One: Quality Control Review. The Project Committee will determine which Proposals passed the quality control review by satisfying the minimum requirements outlined in the RFP and this Regulation. Failure to meet the Evaluation Criteria and other conditions specified in an RFP or this Regulation shall constitute sufficient cause for failing the quality control review. Each Proponent will be notified in writing by the Project Committee that its Proposal has either failed or passed the quality control review and whether it will be advanced to Phase Two. The Project Committee may extend the duration of the Phase One quality control -23- review, in its discretion, due to the volume of Proposals, the complexity of Proposals, the need for additional information, timely cooperation by the Proponents, or other reasonable circumstances. The Project Committee may reject Proposals that: (i) are incomplete; (ii) do not address the requirements of the RFP; or (iii) do not comply with the requirements of this Regulation. Proposal Security will be returned to those Proponents which Proposals are rejected in Phase One. The Project Committee may, in its discretion, disregard any error or defect in the documents of any Proposal, as long as such matters can be corrected or clarified without prejudice to the Authority. The Project Committee may also reject any and all Proposals submitted in this Phase One, if deemed in the best interests of the Authority. If only one Proposal is received, such Proposal may be considered and advanced to Phase Two if the Board, as recommended by the Project Committee and the Executive Director, determines that it is in the best interests of the Authority to do SO. (b) Phase Two: Project Committee Review and Recommendation. The Project Committee will review and evaluate all Proposals that passed the quality control review. Consistent with the policy goals of transparency and accountability, the Project Committee will establish a publicly accessible anticipated schedule for the review of the Proposals and the negotiation of the Contract, if required. Moreover, at any time during Phase Two, the Project Committee may request additional information from a Proponent regarding its Proposal in order to assist the Project Committee in its review and evaluation of the Proposal. Based upon the review of the Proposals, the Project Committee will select one Proposal or may not select any Proposal. In the event the RFP calls for competitive negotiations, the Project Committee may select one or more Proposals. If none of the Proposals are selected -24- by the Project Committee, each Proponent who had advanced to Phase Two will be notified in writing and their Proposal Security returned. If an RFP calls for a competitive negotiation process, the Project Committee will review and consider the Proposals based on the Evaluation Criteria to determine the ranking of each Proposal. Based on such ranking, the Project Committee will determine the Proposals that are within the Competitive Range. The Project Committee shall make recommendations to the Executive Director, and then, with his concurrence, jointly to the Board to, (A) carry out discussions and negotiations with more than one Proponent at the same time, whose Proposals are within the Competitive Range as contemplated in Section 5.1(c) below; or (B) negotiate with the one Proponent achieving the highest rank and, if unsuccessful, continue successive negotiations in strict order of ranking given to each Proposal, as contemplated in Section 5.1(d) of this Regulation. The Board, based on the Executive Director and Project Committee's joint recommendations, shall determine which approach the Project Committee will follow. The Proponents whose Proposals do not fall within the Competitive Range, as defined in Section 2.9 of this Regulation, will be notified in writing and their Proposal Security returned. (c) Phase Three (A): Negotiations with Multiple Proponents. If the Project Committee has elected to carry out discussions and negotiations with Proponents whose Proposals fall within the Competitive Range, such Proponents will receive a written notification containing the details and explaining that negotiations will be conducted according to the following procedures: -25- (i) No statement made or action taken by the Board, the Executive Director, the Project Committee, any employee or officer of the Authority, or any advisor or consultant to or other agent or representative of the Authority during the discussions and negotiations will bind the Authority related to the particular RFP in any way. Only the Contract, when effective in accordance with its terms, will be binding on the Authority. (ii) Each Proponent who falls within the Competitive Range may be invited to one or more meetings with the Authorized Representatives to discuss, and answer questions with respect to, any aspect of its Proposal. (iii) The content and scope of each meeting with each Proponent will be determined by the Project Committee, based on the content of and circumstances relating to the Proponent's Proposal. The purpose of each meeting will be to clarify any doubts as to the requirements of the RFP and confirm that the terms of the Contract are understood; improve technical or other aspects of the Proposal in an effort to assure compliance with the specifications and performance requirements; discuss the basis of the proposed economic terms in an effort to improve the economic terms for the Authority; and discuss any other pertinent details of the Proposal SO as to result in a better Proposal and Contract for the Authority. (iv) If any meetings are held with a Proponent who falls in the Competitive Range, then all Proponents who are within the Competitive Range will be given an opportunity to discuss and review their Proposals with the Authorized Representatives. The discussions, however, will be based on the facts and circumstances relating to each Proposal, as described in paragraph (ii) above. The information discussed in such meetings may vary for each Proponent. -26- (v) The Project Committee and the Executive Director, or others whom the Board may designate, will: (1) Establish procedures and schedules to carry out the discussions and to control the meetings; (2) Advise the Proponent as to deficiencies in its Proposal SO that it is given the opportunity to meet the requirements of the Authority; (3) Attempt to resolve any uncertainties concerning the Proposal, and otherwise clarify the terms and conditions of the Proposal; (4) Address any suspected mistakes that may be found to exist; (5) Provide the Proponent with an opportunity to submit any modification to the economic terms, technical aspects or any other aspects of its Proposal which may result from the discussions, or the opportunity to provide additional documentation or analysis to assist the Project Committee in assessing the feasibility of the Project and the Proponent's qualifications; and (6) Keep a record of the date, time, place, and attendees of the meetings. (vi) After each interview or meeting with any Proponent, the Project Committee may require the Proponent to submit in writing confirmation of any clarification of a Proposal discussed in the meeting within the timeframe discussed during the meeting. (vii) Discussions and negotiations may be carried out in whole or in part through written or telephone communications without in-person meetings or interviews, at the discretion of the Project Committee. -27- (viii) After such discussions and parallel negotiations, the Project Committee may, in its discretion, request "best and final offers" from Proponents within the Competitive Range in response to the discussions and negotiations held or proceed to negotiations with one of the Proponents within the Competitive Range which may culminate in an Award of Contract. (ix) If the Project Committee determines to conduct a "best and final offer" process, additional discussions or negotiations may be conducted after the Project Committee receives the "best and final offer," if the Project Committee determines, in its discretion, that such additional discussions or negotiations are in the Authority's best interest to improve any previous Proposal or Proposals. As part of such discussions, the Project Committee may request a further resubmission of Proposals or, if no improvement or more beneficial terms are obtained for the Authority, the Project Committee may proceed to negotiate with the Proponent who submitted the highest ranking Proposal pursuant to the process established in Section 5.1(d) below. (d) Phase Three (B): Negotiations with Highest Ranking Proponent. If the Project Committee elects to carry out discussions and negotiations with the Proponent whose Proposal received the highest rank, the Project Committee will notify in writing the Proponents of the Proposals which fall within the Competitive Range but were not the highest ranking Proponent or failed to provide a better Proposal after the Project Committee conducted negotiations with multiple Proponents under Section 5.1(c) above, that negotiations will be conducted with the highest ranking Proponent. The highest ranking Proponents will receive a written notification containing the details and explaining that negotiations will be conducted according to the following procedures: -28- (i) No statement made or action taken by the Board, the Project Committee, any employee or officer of the Authority, or any advisor or consultant to or other agent or representative of the Authority or of the Project Committee during the discussions and negotiations will bind the Authority or the Project Committee in any way. Only the Contract, when effective in accordance with its terms, will be binding on the Authority. The Proponent may not contact or communicate with the Authority, its representatives or the Energy Commission, other than with Authorized Representatives during the negotiation process and only as provided in this Regulation and in any specific instructions provided by the Project Committee. (ii) The Proponent with the highest ranking which falls within the Competitive Range will be invited to one or more meetings with the Authorized Representatives to discuss, and answer questions with respect to, any aspect of its Proposal. (iii) The content and scope of the meetings with the Proponent will be determined by the Project Committee, based on the content of and circumstances relating to the Proponent's Proposal. The purpose of such meeting will be to clarify any doubts as to the requirements of the RFP and confirm that the terms of the Contract are understood; improve technical or other aspects of the Proposal in an effort to assure compliance with the specifications and performance requirements; discuss the basis of the proposed economic terms in an effort to improve the economic terms for the Authority; and discuss any other pertinent details of the Proposal SO as to result in a better Proposal and Contract for the Authority. (iv) The Project Committee and the Executive Director, or others whom the Board may designate, will: -29- (1) Establish procedures and schedules to carry out the discussions and to control the meetings; (2) Advise the Proponent as to deficiencies in its Proposal SO that it is given an opportunity to meet the requirements of the Authority; (3) Attempt to resolve any uncertainties concerning the Proposal, and otherwise clarify the terms and conditions of the Proposal; (4) Address any suspected mistakes that may be found to exist; (5) Provide the Proponent with an opportunity to submit any modification to the economic terms, technical aspects or any other aspects of its Proposal which may result from the discussions, or the opportunity to provide additional documentation or analysis to assist the Project Committee in assessing the feasibility of the Project and the Proponent's qualifications; and (6) Keep a record of the date, time, place, and attendees of the meetings. (v) After each interview or meeting with the Proponent, the Project Committee may require the Proponent to submit in writing confirmation of any clarification of a Proposal discussed in the meeting. (vi) Discussions and negotiations may be carried out in whole or in part through written or telephone communications without in-person meetings or interviews, at the discretion of the Project Committee. (vii) Additional discussions or negotiations may be conducted after the Authority receives a revised Proposal. If negotiations are not successful the Project Committee -30- may at any time discontinue further negotiations and discussions with any Proponent, and may commence negotiations with the next highest ranking Proponent as described in this section. (e) Subject to the Authority's right to reject any or all Proposals and subject to the Energy Commission approval of the final Contract to be negotiated, the Authority will select the Proposal considered most advantageous to it, considering the Evaluation Criteria. (f) Prior to the Award of a Contract, information related to Proposal or its evaluation will not be discussed with anyone other than the Proponent who submitted it and personnel involved in the evaluation and selection process. (g) The RFP evaluation process will last no more than ninety (90) days, unless circumstances outside the control of the Project Committee require such process to be extended. (h) Proposals will be evaluated on both price or cost criteria, such as price or service fee, and relevant system upgrade costs (when applicable), as well as non-price terms such as Proponent experience constructing and operating similar facilities, project risks and proposed risk mitigation measures, and other pertinent criteria. Proposals will also be evaluated by the degree to which they conform to the requirements established in the standard form of contracts included as part of the RFP. (i) The respective scoring system of all Evaluation Criteria should be clearly defined in the RFP. 5.2 Amendment to Procurement Process. Nothing in this Regulation shall limit the Authority's power to amend the procurement process set forth herein pursuant to an amendment to this Regulation or to modify it in connection with a particular RFP in the manner set forth in such RFP to the extent not in conflict with the Acts and other applicable law. -31-