Water Authority tries again to sell off sewerage
(CNS): After a number of problems surrounding efforts to find a buyer for the Water Authority's sewerage system, another request for proposals has been advertised. The government company is once again inviting eligible companies to submit a tender to assume ownership of the public wastewater infrastructure on Grand Cayman, and to operate and maintain the sewerage system and to provide wastewater services under an exclusive 25-year licence. Grand Cayman’s waste is estimated to be worth about $20 million, a sum government had included in this year’s budget, but with an August deadline on the RFP, that cash will now miss the 2011/12 financial year leaving a hole in the public coffers.
The government had hoped to divest at least the sewerage system if not the entire Water Authority during this administration but it has failed to do so. It had instructed the Water Authority that it had until 30 June this year to sell off the waste in order to count the cash in this year’s budget as the money was supposed to be used to complete the public high schools.
The last RFP failed to find a buyer after alleged difficulties with the bids, even though the period was extended six times. The auditor general became involved after the process stalled with the cabinet appointed technical committee, which appeared to comprise mostly of political selections rather than technical experts. The audit office raised concerns that the assessment of bids was carried out by a committee appointed by Cabinet, with no input from Water Authority management when Cabinet had no remit to do so.
Eventually a new committee, comprising Water Authority staff and board members, was established, with the Water Authority’s director Gelia Frederick-van Genderen as the chair.
The Central Tenders Committee also had raised concerns that the evaluation report contained no substantial information on the impact the divestment of wastewater assets would have on customers and the local cost of doing business.
In minutes from an October meeting of the WA board, released under a freedom of information request, the chairman had said that decisions over the sale of the sewerage system had been “completely removed from the authority management and to some extent out of the hands of the board” with the divestment decision being a “political” one.
According to the latest request, the successful company that wins the bid will be required to provide expansions to the existing wastewater system to meet the future needs of the country. The existing public wastewater system, which comprises a gravity collection system with a number of lift stations, has a total length of approximately 12.5 miles. The system also includes approximately 2.7 miles of force mains.
The wastewater treatment plant has a capacity of 2.5 million US gallons per day and currently collects and treats nearly 2 million gallons of waste each day in addition to around 20,000 gallons of septage delivered by commercial haulers.
Aside from complying with applicable local laws and regulations, interested parties need to provide a tender bond in the amount of US$200,000 and have no less than ten years’ experience with providing wastewater services for public authorities for systems serving at least 60,000 people, and have the cash without needing a government guarantee.
The authority said that the tendering documents will be available this coming Friday 18 May and proposals need to be sent to the Water Authority by 12:00 noon on Wednesday 15 August 2012.
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