How sound procurement can boost resilience

PROVIDENCE, R.I. — Procurement can be vexing for all sorts of municipal issuers, from large transit agencies to small cities.

In climate resilience, new approaches could mark a path forward.

BB-100719-TREND.jpeg

“It’s one of the most important resilience strategies that there is for cities,” Elle Hempen, co-founder and chief executive of online community The Atlas, said at the third annual Rhode Island Infrastructure Bank summit.

The Sept. 26 event at the Rhode Island Convention Center in downtown Providence drew more than 350 people.

Hempen’s San Diego-based website enables municipalities to share experiences in so-called smart cities initiatives.

They include a “smart” sewer system in Greater Cincinnati; rain retention in Norfolk, Virginia; sensors to boost recycling rates in Atlanta; and a driverless shuttle in Las Vegas.

“Procurement is, really, if you think about it, one of the most important things governments do,” said Robert Zarnetske, town manager of South Kingstown, a 30,000-population southeastern Rhode Island town along the coast of Block Island Sound.

Audio: HUD Secretary Henry Cisneros chats with The Bond Buyer's Paul Burton about the changing face of infrastructure funding.

Contracting gone sour can inhibit recovery initiatives large and small.

In New York City, consultants who failed to do required work after Hurricane Sandy struck in October 2012 left thousands of victims without help. Problems linger in the more water-prone parts of the city.

A 2015 audit by city Comptroller Scott Stringer revealed that the city’s Office of Housing Recovery Operations failed to properly monitor contractors and paid $6.8 million to them for work that that was flawed or incomplete — contributing to extensive delays in the delivery of aid to more than 20,000 people seeking help.

According to Hempen, standard procurement practices such as requests for proposals generate “a bias toward the familiar,” which restricts innovation.

“When it comes to resilience, procurement can sometimes be a frustrating part of the process, because procurement often makes it easier for cities or agencies to buy what they already have from companies that they already work with," she said.

“To get a better answer, you have to ask better questions from more types of people, and we think procurement is a way to do that."

Local leaders should guard against falling back on time-worn fixes rather than sustainable systems, Shalini Vajjhala and Ellory Monks wrote in a Brookings Institution commentary.

“Unfortunately, our procurement systems were designed to meet a narrower set of needs than many government agencies have today,” they said.

New types of procurement tools include requests for ideas.

Boston, Atlanta, and Prince George's County, Maryland, outside Washington, to name a few, have been experimenting with RFIs. Other creative options include competitions or challenges — such as the Metropolitan Transportation Authority’s tech-related “genius challenge” in New York — and performance contracts.

“Just as it is possible to develop bad RFPs, it is also possible to have terrible RFIs, competitions and challenges, and performance contracts,” Vajjhala and Monks said. “Procurement success depends on framing problems well and setting effective procurement terms.”

Rhode Island, the nation’s smallest state, is 37 miles wide by 48 miles long, with 400 miles of coastline. State officials launched a “Resilient Rhody” initiative in July 2018, designed to bolster the state’s infrastructure.

“We’ve made really good progress on the implementation of that strategy ever since we released it,” said Shaun O’Rourke, the state’s chief resiliency officer and the director of stormwater and resiliency at the infrastructure bank.

“We really learned a lot in writing the Resilience Rhody strategy,” said O’Rourke, who called local leaders “co-authors” of the strategy. “We also learned that climate change is not just a coastal issue. Many of our inland post-industrial cities and towns are absolutely feeling the effects of climate change right now, every day.”

The infrastructure bank, which began in 2015 and evolved from the triple-A rated Rhode Island Clean Water Finance Agency, has provided more than $2 billion in financing.

Jeffrey R. Diehl is the Executive Director and CEO of Rhode Island Infrastructure Bank

Diehl said his organization represents “a fairly unique model in the United States and almost in the world, an integrated, centralized infrastructure bank. It’s not really something that other states have.”

Audio: Rhode Island Infrastructure Bank CEO Jeffrey Diehl and board Chair Merrill Sherman reflect on the bank's achievements.

Rhode Island ranked tied for third with Vermont in the American Council for an Energy Efficient Economy’s state scorecard, trailing only Massachusetts and California.

The council scored states across six primary policy areas in which they are pursuing energy efficiency: utility and public benefits programs; transportation; building energy efficiency; policies encouraging combined heat and power, or CHP systems; state government-led initiatives; and appliance and equipment standards.

Redesign, Zarnetske said, should involve public policies as well as public infrastructure.

“Think about the way we do procurement at the municipal level today,” he said. “How many folks work for a municipality who has a person as their chief procurement officer, or how many had that title in municipal government? It’s usually a procurement clerk, low-level, not necessarily highly trained … but how many have had a chief procurement officer who actually went to school to learn contracting? Almost none of us.”

Hempen, who cited Boston, Philadelphia and Atlanta for their procurement best practices, said cities should frame the problem first and then ask for specific outcome, not for a specific solution.

Also, make clear what you don’t want.

“The best procurement documents state their goals up front, clearly with simple steps,” she said. “When you bury things under legal mumbo-jumbo, it makes things more difficult. I read a whole bunch of procurements on the way over here and I can still tell you I have no idea what they are or what they’re asking for.”

She also urged municipal leaders to tap ideas from elsewhere.

“Don’t start from scratch,” she said. “Other cities from across the country and around the world are constantly trying out new methods and learning from those experiences. We’re seeing new examples come out all the time when it comes to resilience, particularly in southeast Florida, the Gulf Coast and of course all up and down the Northeast as well.

“There is no shame in doing some R&D. By that I mean feel free to rip off and duplicate solutions from the other cities. Every city I met has been more than happy to share what’s worked and, more importantly, what hasn’t worked.”

Louis Gritzo, vice president of research at FM Global in Johnston, Rhode Island, urged municipal officials to scrutinize resilience materials.

“If you’re looking for something, look for something that’s been tested and certified,” he said. “There have been some communities, especially along the Mississippi, that have put up some kind of makeshift barriers that unfortunately failed and the downtown flooded anyway.”

Smart planning, according to Zarnetske, includes factoring resilience into broader policies.

“Our policies have to change in that we can’t think about resilience in isolation from everything else,” he said, referencing how the definition of “safe, affordable housing” has evolved.

“It means the stairs don’t fall down,” Zarnetske said. “We’ll, we’re tweaking it. It means safe in a hurricane and in a flood and in a heat wave. Because that’s the environment where the housing needs to be safe.

“It’s not safe if seniors are dying in a heat wave.”

For reprint and licensing requests for this article, click here.
Infrastructure Climate change State of Rhode Island Rhode Island
MORE FROM BOND BUYER