Print Friendly SENATE BILL NO. 1222 – Public entity/bldgs/energy savings
SENATE BILL NO. 1222
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S1222......................................by LOCAL GOVERNMENT AND TAXATION
PUBLIC ENTITY - BUILDINGS - Amends existing law to define the term "public
entity"; to provide that a public entity may utilize the procedure for
bidding performance contracts for the installation or purchase of
cost-savings energy measures in buildings occupied by and for public
entities; and to provide a limitation on such performance contracts entered
into by the state or public entities.
01/22 Senate intro - 1st rdg - to printing
01/23 Rpt prt - to Loc Gov
01/27 Rpt out - rec d/p - to 2nd rdg
01/28 2nd rdg - to 3rd rdg
01/30 3rd rdg - PASSED - 30-0-5
AYES -- Andreason, Bailey, Bunderson, Burkett, Calabretta, Cameron,
Compton, Darrington, Davis, Gannon, Geddes, Goedde, Hill, Ingram,
Kennedy, Keough, Little(Bilbao), Lodge, Malepeai, Marley, McKenzie,
McWilliams, Noble, Pearce, Richardson, Sorensen, Stegner, Sweet,
NAYS -- None
Absent and excused -- Brandt, Burtenshaw, Noh, Schroeder, Stennett
Floor Sponsor - Bunderson
Title apvd - to House
02/02 House intro - 1st rdg - to Loc Gov
02/11 Rpt out - rec d/p - to 2nd rdg
02/12 2nd rdg - to 3rd rdg
02/18 3rd rdg - PASSED - 64-1-5
AYES -- Andersen, Barraclough, Barrett, Bauer, Bayer, Bedke, Bell,
Black, Boe, Bolz, Bradford, Campbell, Cannon, Clark, Collins, Crow,
Deal, Denney, Douglas, Eberle, Ellsworth, Eskridge, Field(18),
Field(23), Gagner, Garrett, Harwood, Henbest, Jaquet, Jones,
Kellogg(Nonini), Kulczyk, Lake, Langford, Langhorst, Martinez,
McGeachin, Meyer, Miller, Mitchell, Moyle, Naccarato, Pasley-Stuart,
Raybould, Ridinger, Ring, Ringo, Roberts, Robison, Rydalch, Sali,
Sayler, Schaefer, Shepherd, Shirley, Skippen, Smith(30), Smith(24),
Smylie, Snodgrass, Stevenson, Trail, Wood, Mr. Speaker
NAYS -- McKague
Absent and excused -- Block, Cuddy, Edmunson, Nielsen, Wills
Floor Sponsor - Eskridge
Title apvd - to Senate
02/19 To enrol
02/20 Rpt enrol - Pres signed
02/23 Sp signed
02/24 To Governor
02/26 Governor signed
Session Law Chapter 15
]]]] LEGISLATURE OF THE STATE OF IDAHO ]]]]
Fifty-seventh Legislature Second Regular Session - 2004
IN THE SENATE
SENATE BILL NO. 1222
BY LOCAL GOVERNMENT AND TAXATION COMMITTEE
1 AN ACT
2 RELATING TO ENERGY SAVINGS PERFORMANCE CONTRACTS; AMENDING SECTION 67-5711D,
3 IDAHO CODE, TO DEFINE THE TERM "PUBLIC ENTITY" AND TO PROVIDE THAT A PUB-
4 LIC ENTITY MAY UTILIZE THE PROCEDURE FOR BIDDING PERFORMANCE CONTRACTS FOR
5 THE INSTALLATION OR PURCHASE OF COST-SAVINGS ENERGY MEASURES IN BUILDINGS
6 OCCUPIED BY AND FOR PUBLIC ENTITIES AND TO PROVIDE LIMITATION ON SUCH PER-
7 FORMANCE CONTRACTS ENTERED INTO BY THE STATE OR PUBLIC ENTITIES AND TO
8 MAKE A TECHNICAL CORRECTION.
9 Be It Enacted by the Legislature of the State of Idaho:
10 SECTION 1. That Section 67-5711D, Idaho Code, be, and the same is hereby
11 amended to read as follows:
12 67-5711D. ENERGY SAVINGS PERFORMANCE CONTRACTS. (1) Definitions. As used
13 in this section:
14 (a) "Cost-savings measure" means any facility improvement, repair or
15 alteration, or any equipment, fixture or furnishing to be added or used in
16 any facility that is designed to reduce energy consumption and energy
17 operating costs or increase the energy efficiency of facilities for their
18 appointed functions that are cost effective. "Cost-savings measure"
19 includes, but is not limited to, one (1) or more of the following:
20 (i) Procurement of low-cost energy supplies of all types, includ-
21 ing electricity, natural gas and water;
22 (ii) Insulating the building structure or systems in the building;
23 (iii) Storm windows or doors, caulking or weather stripping,
24 multiglazed windows or door systems, heat-absorbing or heat-
25 reflective glazed and coated window and door systems, additional
26 glazing, reductions in glass area or other window and door system
27 modifications that reduce energy consumption;
28 (iv) Automated or computerized energy control systems;
29 (v) Heating, ventilation or air conditioning system modifications
30 or replacements;
31 (vi) Replacing or modifying lighting fixtures to increase the
32 energy efficiency of the lighting system;
33 (vii) Energy recovery systems;
34 (viii) Cogeneration systems that produce steam or forms of energy
35 such as heat, as well as electricity, for use primarily within a
36 building or complex of buildings;
37 (ix) Installing new or modifying existing day lighting systems;
38 (x) Installing or modifying renewable energy and alternate energy
40 (xi) Building operation programs that reduce energy costs includ-
41 ing, but not limited to, computerized programs, training and other
42 similar activities;
43 (xii) Steam trap improvement programs that reduce energy costs;
1 (xiii) Devices that reduce water consumption; and
2 (xiv) Any additional building infrastructure improvements that pro-
3 duce energy cost savings, significantly reduce energy consumption or
4 increase the energy efficiency of the facilities for their appointed
5 functions and are in compliance with all applicable state building
7 (b) "Director" means the director of the department of administration or
8 the director's designee.
9 (c) "Energy cost savings" means any expenses that are eliminated or
10 avoided on a long-term basis as a result of equipment installed or modi-
11 fied, or services performed by a qualified energy service company or a
12 qualified provider, but does not include merely shifting personnel costs
13 or similar short-term cost savings.
14 (d) "Financial grade energy audit" means a comprehensive building energy
15 systems audit performed by a professional engineer licensed in the state
16 of Idaho for the purpose of identifying and documenting feasible energy
17 and resource conservation measures and cost-savings factors.
18 (e) "Performance contract" means a contract between the director or the
19 public entity and a qualified provider or a qualified energy service com-
20 pany for evaluation, recommendation and implementation of one (1) or more
21 cost-savings measures. A performance contract may be structured as either:
22 (i) A guaranteed energy savings performance contract, which shall
23 include, at a minimum, the design and installation of equipment and,
24 if applicable, operation and maintenance of any of the measures
25 implemented. Guaranteed annual savings must meet or exceed the total
26 annual contract payments made by the director or the user agency or
27 the public entity for such contract, including financing charges to
28 be incurred over the life of the contract; or
29 (ii) A shared savings contract, which shall include provisions mutu-
30 ally agreed upon by the director and the qualified provider or quali-
31 fied energy service company as to the rate of payments based upon
32 energy cost savings and a stipulated maximum energy consumption level
33 over the life of the contract ;.
34 (f) "Person" means an individual, corporation, partnership, firm, associ-
35 ation, limited liability company, limited liability partnership or other
36 such entity as recognized by the state of Idaho.
37 (g) "Public entity" means the cities, counties and school districts or
38 any political subdivision within the state of Idaho.
39 (h) "Qualified energy service company" means a person with a record of
40 established projects or with demonstrated technical, operational, finan-
41 cial and managerial capabilities to implement performance contracts and
42 who currently holds an Idaho public works contractor license.
43 ( hi) "Qualified provider" means a person who is experienced in the
44 design, implementation and installation of energy efficiency and facility
45 improvement measures, who has the ability to secure necessary financial
46 measures to support energy savings guarantees and the technical capabili-
47 ties to ensure such measures generate energy cost savings, and who cur-
48 rently holds an Idaho public works contractor license.
49 (2) Performance contracts. The director of the department of administra-
50 tion, subject to the approval of the permanent building fund advisory council,
51 or any Idaho public entity may enter into a performance contract with a quali-
52 fied provider or qualified energy service company to reduce energy consumption
53 or energy operating costs. Cost-savings measures implemented under such con-
54 tracts shall comply with all applicable state and local building codes.
55 (3) Requests for qualifications. The director of the department of admin-
1 istration or the public entity shall request qualifications from qualified
2 providers and qualified energy service companies inviting them to submit
3 information describing their capabilities in the areas of:
4 (a) Design, engineering, installation, maintenance and repairs associated
5 with performance contracts;
6 (b) Experience in conversions to a different energy or fuel source, so
7 long as it is associated with a comprehensive energy efficiency retrofit;
8 (c) Postinstallation project monitoring, data collection and reporting of
10 (d) Overall project experience and qualifications;
11 (e) Management capability;
12 (f) Ability to assess the availability of long-term financing;
13 (g) Experience with projects of similar size and scope; and
14 (h) Other factors determined by the director or the public entity to be
15 relevant and appropriate relating to the ability of the qualified provider
16 or qualified energy service company to perform the project.
17 (4) Notice. Adequate public notice of the request for qualifications
18 shall be given at least fourteen (14) days prior to the date set forth therein
19 for the opening of the responses to the request for qualifications. Such
20 notice may be provided electronically or by publication in a newspaper of gen-
21 eral circulation in the area where the work is located.
22 (5) Public inspection. All records of the department or an agency or the
23 public entity relating to the award of a performance contract shall be open to
24 public inspection in accordance with the provisions of sections 9-337 through
25 9-347 and 67-5725, Idaho Code.
26 (6) Award of performance contract.
27 (a) The director or public entity shall select up to three (3) qualified
28 providers or qualified energy service companies who have responded to the
29 request for qualifications. Factors to be considered in selecting the suc-
30 cessful qualified provider or qualified energy service company shall
31 include, but not be limited to:
32 (i) Fee structure;
33 (ii) Contract terms;
34 (iii) Comprehensiveness of the proposal and cost-savings measures;
35 (iv) Experience of the qualified provider or qualified energy ser-
36 vice company;
37 (v) Quality of the technical approach of the qualified provider or
38 qualified energy service company; and
39 (vi) Overall benefits to the state or the public entity.
40 (b) Notwithstanding the provisions of section 67-5711C, Idaho Code, the
41 director or the public entity may, following the request for qualifica-
42 tions and the expiration of the specified notice period, award the perfor-
43 mance contract to the qualified provider or qualified energy service com-
44 pany which best meets the needs of the project and whose proposal may or
45 may not represent the lowest cost among the proposals submitted pursuant
46 to this section.
47 (c) Upon award of the performance contract, the successful qualified pro-
48 vider or qualified energy service company shall prepare a financial grade
49 energy audit which, upon acceptance by the director or the public entity,
50 shall become a part of the final performance contract.
51 (7) Installment payment and lease-purchase agreements. Pursuant to this
52 section, the director or the public entity may enter into a performance con-
53 tract, payments for which shall be made by the user agency or public entity.
54 Such performance contracts may be financed as installment payment contracts or
55 lease-purchase agreements for the purchase and installation of cost-savings
1 measures. Financing implemented through another person other than the quali-
2 fied provider or qualified energy service company is authorized.
3 (8) Terms of performance contract.
4 (a) Each performance contract shall provide that all payments between
5 parties, except obligations upon termination of the contract before its
6 expiration, shall be made over time and that the objective of such perfor-
7 mance contract is the implementation of cost-savings measures and energy
8 cost savings.
9 (b) A performance contract, and payments provided thereunder, may extend
10 beyond the fiscal year in which the performance contract becomes effec-
11 tive, subject to appropriation by the legislature or by the public entity,
12 for costs incurred in future fiscal years. The performance contract may
13 extend for a term not to exceed twenty-five (25) years. The permissible
14 length of the contract may also reflect the useful life of the cost-
15 savings measures.
16 (c) Performance contracts may provide for payments over a period of time
17 not to exceed deadlines specified in the performance contract from the
18 date of the final installation of the cost-savings measures.
19 (d) Performance contracts entered pursuant to this section may be amended
20 or modified, upon agreement by the director or the public entity and the
21 qualified provider or qualified energy service company, on an annual
23 (9) Monitoring and reports. During the term of each performance contract,
24 the qualified provider or qualified energy service company shall monitor the
25 reductions in energy consumption and cost savings attributable to the cost-
26 savings measures installed pursuant to the performance contract and shall
27 annually prepare and provide a report to the director or the public entity
28 documenting the performance of the cost-savings measures.
STATEMENT OF PURPOSE
During the 2001 session of the Idaho Legislature, Section
67 5711D of the Idaho Code was amended to provide state
agencies a bidding procedure for procurement of low-cost
energy saving services. The new bidding process entitled
"Energy Saving Performance Contracting" specified a way to
finance and implement capital energy improvements and
services offered by a qualified energy service company
(ESCO). The code amendment specified that energy and cost
savings produced by a project need to be sufficient to cover
all project costs (including financing and ongoing
maintenance and monitoring services) over the contract term.
Over the past three years many Idaho cities, counties and
public school districts have successfully entered into
performance contracting agreements. However, unnecessary
costs have been incurred and projects delayed.
This amendment extends to Idaho public entities the same
rights and process for performance contracting bidding that
is current law for state agencies and facilities.
There will be no negative fiscal impact on the State or any
public entity. No costs or fees will be incurred or
initiated as a result of this legislation. A positive fiscal
impact will be realized by each public entity that enters
into the bidding process for energy saving performance
contracts due to the enabling language of the Idaho Code.
Sen. Hal Bunderson
Sen. George Eskridge