With Independence Power & Light going through large and, at times, difficult changes, City Manager Zach Walker wants to make sure the city's power utility can land smoothly. He's looking to the private sector for possible help.
The city looking for utility operations management services to help oversee operations for IPL for an unspecified time. The department has not had a general manager since Brenda Hampton left in late June after less than six months on the job.
Walker is looking for a firm that can help prioritize areas of operation to work through, manage daily operations and possibly make recommendations in recruiting the IPL's next general manager. Such a firm could be on hand roughly 18 months to up to three years, Walker said.
Walker said the biggest motivator for the “request for qualifications” for outside help is that the City Charter calls for IPL and other utilities to be run in a business-like fashion.
“What better way than to bring in private-sector expertise and really get down to the essence of what is the most viable, cost-effective way to operate,” Walker said.
IPL recently cut operating expenses $8 million to account for the City Council's decisions to give 6 percent rate cuts, while the city still awaits the final rate study results from Burns & McDonnell. Next year it begins a 10-year contract with Oneta, a gas-powered plant in Oklahoma, to replace the capacity from the 60-year-old Blue Valley Power Plant on Truman Road.
Assistant City Manager Mark Randall told the Public Utilities Advisory Board on Thursday that the Southwest Power Pool – the city's power broker – confirmed transmission costs to bring Oneta on board will be well below $1 million, so the contract will take effect June 1, 2020 as planned. The Blue Valley plant can close at that point.
The city is entering negotiations on the next contract with International Brotherhood of Electrical Workers Local 53, the union that represents many IPL employees, and on the near horizon, the city will have to look at how long to operate the aging-but-in-good-repair combustion turbines and possibly repurposing the power plant building.
“We're dealing with a multitude of issues,” Walker said. “While out of this I want an individual to be the face of IPL, I also want a business and partnership to help us land the plane.”
“It would be long enough to get through some of these core issues, but I don't see this bring a long-term thing.”
According to the “request for qualifications,” proposals will be evaluated on experience and references, expertise of personnel, resources available to the firm and cost-effective services.
Responses are due by Nov. 21, and a short list is to be developed by Dec. 9.
“We'll see what we need to get out of this and what steps that we need to take,” Walker said.
A potential cost is not mentioned in the RFQ, but Walker said he plans to mostly cover the management services with money budgeted for a general manager – likely less than $200,000.
“We want something that's the most effective but also cost efficient,” he said. “If they come back more (in cost), then we'll re-evaluate.”
Randall has been overseeing day-to-day operations since Hampton's departure, and Walker will reassign IPL supervision from Randall to Assistant City Manager, but Walker said the request is not a reflection on Randall. The city manager added the request is just for management with Power & Light, not the water or water pollution control departments.
“They've got steady leadership hands in Dan Montgomery and Lisa Phelps, and they just don't have the multiplicity of issues as IPL,” Walker said. “Mark Randall is a pro, and he's done a great job being a steady hand, but I need an assistant manager to help oversee other things, as well.”
“I wanted to pull him off the front lines, to where his capacity is better utilized, and I didn't want to just switch out and do a plug and play.”