Table of Contents
Introduction
Requests for Proposals
Specific Considerations
- Cost Estimate and Budget Delineated by Category
- Schedule Based Upon Milestones
- Fees for Basic and Additional Services
- Standard and Special Terms and Conditions
- Technical Experience
- Non-Technical Experience
- References
- Relationship with Subcontractors
- Writing Samples
- Conflicts of Interest
- Statement of Qualifications
- Resumes
- References
- General and Special Experience
- Financial Strength
- Insurance
- Face to Face Meeting
- The Interviewing Team
- Authority for Decision Making
- Conducting Interviews
- Communication Skills
Introduction
A request for proposal should be prepared in a manner that allows for comparison of the responses to the proposal on an "apples to apples" basis. Generally, this is accomplished through the inclusion in the request for proposal of a minimum or mandatory scope of work, together with instructions that the response must include recommendations as to additional services.
Requests for Proposals
A number of considerations should be taken into account in issuing a request for proposal.
Specific Considerations
A number of factors are analyzed by the courts in determining whether an implied operating covenant exists.
Cost Estimate and Budget Delineated by Category
To the extent possible, the request for proposal should include a requirement for a detailed cost estimate and budget delineated by category. To allow the lawyer or client to make an accurate comparison of costs, it is crucial that the responses obtained be consistent and uniform. One of the ways to reach this goal is to prepare a detailed scope of work and suggest the general categories for the cost breakdown. By suggesting cost categories, and requesting that the response include a description of additional services required, it is usually possible to obtain a complete cost estimate delineated by category.
Schedule Based Upon Milestones
As in other construction projects, it may be important to establish milestones and milestone dates for the consultant. These milestone dates could be based upon the different phases of the investigation (i.e., phase I, phase II, removal actions and remediation activities), be tied to the phases of any construction proposed in connection with the site, or simply be based upon such factors as location. Even if a schedule based upon milestones is not important for the proposed project, requesting such a schedule often forces the consultant to commit to a firm schedule and may uncover subcontracting issues not known or anticipated.
Fees for Basic and Additional Services
Like architects and engineers, many environmental consultants propose separate fees for basic and additional services. To ensure that all costs are known, the request for proposal should require a separation of fees for the services requested and a schedule for hourly fees for additional services, together with a description of what will constitute additional services. It is not sufficient to simply list individuals and hourly rates for additional services; what is needed is a description of the items which may be included in those services.
Standard and Special Terms and Conditions
In response to a request for a description of standard and special terms and conditions, often the consultant will furnish its standard form contract. Some lawyers and clients prefer to furnish a form of standard contract and request that the consultant identify any concerns that it may have regarding the standard and special terms and conditions contained in the contract.
Technical Experience
As discussed in Part I of this article, ensuring that the technical experience of the consultant matches the purpose of the assessment is one of the most crucial aspects in the selection process. The request for proposal should include a request that the consultant identify how its technical experience will meet the needs of the assessment or project. If possible, those areas of expertise which are known to be necessary should be identified.
Non-Technical Experience
In addition to evaluating technical expertise, it is important to evaluate non-technical expertise. A consultant who has worked primarily for governmental agencies may be less attuned to the client's needs than one who has worked primarily with private clients. If litigation is likely, will the consultant be able to provide key personnel as effective witnesses? If the consulting assignment is in connection with a potential acquisition or development, will the consultant be able to make a clear and concise oral presentation?
References
Early checking of the consultant's references is good practice, although the consultant will probably provide only references who give favorable reviews. Some lawyers, on behalf of their clients, will ask for a reference to an experienced environmental lawyer who has worked with the consultant. An environmental lawyer is often more likely to be in a position to judge whether the consulting firm has lived up to its obligations and has been effective in prior assignments.
Relationship with Subcontractors
A request for proposal should inquire as to whether or not the consultant intends to utilize subcontractors. Not only will the answer qualify the consultant as to the breadth and depth of its expertise, it will allow the lawyer and client to identify areas where special services may or may not be required. Generally, the use of subcontractors will lead to increased costs and therefore the use of subcontractors is an important consideration.
Writing Samples
Writing samples should be requested and the lawyer and client should try to go beyond the color graphics and fold outs. Is the writing clear enough that the lawyer and client will be able to evaluate progress reports? Will the consultant be able to persuade the regulatory authorities so that multiple rounds of expensive tests will be avoided?
Conflicts of Interest
Analysis of conflicts of interest, particularly in connection with national or regional firms, is important. While most national or regional firms now have conflict of interest policies, the usual standard is that a "direct adverse interest" must be present before disclosure of the conflict will be made. This standard falls far short of what should be required in connection with a request for proposal.
Reviewing Responses to Requests for Qualifications/ Proposals
Knowing how to review the responses to a request for proposal is an important aspect of the selection of an environmental consultant.
Statement of Qualifications
Typically, a statement of qualifications will be included with a response to a request for proposal. Unfortunately, since there is not a national licensing program for environmental consulting firms, and since most states do not have licensing procedures for consultants, the statement of qualifications may take many forms. However, often consulting firms are required to be licensed for certain limited activities such as asbestos abatement, underground storage tank removal, lead-based paint removal and, where applicable, in connection with voluntary action programs. In such cases, the statement of qualifications filed with the regulatory agencies may be obtained and can often be downloaded from a centralized website maintained by the state environmental protection agency. These statements of qualifications should be sought in addition to what is furnished by the consultant.
Resumes
The resumes of key project personnel are important. Often, consultant firms will use "business development" professionals to make the initial contact. Although those contacts may be helpful in order to gain an understanding of the consulting firm, a close review of the resumes of those project personnel who will ultimately have responsibility to conduct the work is critical. If more junior personnel will be assigned to the assessment work, resumes of those individuals should be collected as well.
References
It is not sufficient to simply receive and review the resumes furnished by the consultant. In connection with any significant project, certain questions should be asked of the references: Were you satisfied with the service provided by the consultant? Did the consultant respond in a timely manner throughout the project period? Was the project performed within budget? Was the report format appropriate? Was the consultant willing to work with you as to the findings and conclusions contained in the final report? Did you experience any difficulties with the consultant? Would you use this consultant again? Would you recommend this consultant to others?
General and Special Experience
Evaluating the general and special experience of the consulting firm in relationship to the proposed assessment work is the most subjective aspect of reviewing responses to a request for proposal. Because of the subjective nature of this aspect of review, it may be useful to have the assistance of a trusted environmental professional to evaluate the general and special experience of the consulting firms who have submitted responses to the request for proposal. Such advice can be obtained from an environmental lawyer with specific recent experience as to the issues involved in the assessment or project, an independent consulting firm which the client has utilized on other projects but may not intend to use on the proposed assessment or project, and from a variety of other sources. Sometimes a call to a specialist within one of the regulatory agencies at the state or local level will reveal strengths or weaknesses in the general and special experience of the consultant. It is also important to talk directly to the individuals who purport to have the required general and special experience and to ascertain the breadth and depth of that experience.
Financial Strength
In any significant project, the financial strength of the consultant should be evaluated. Oftentimes, if requested in connection with the request for proposal, the information will be readily furnished by the consultant. In other cases, inquiries of credit agencies, banks and insurance carriers can be made.
Insurance
A sample of a certificate of insurance furnished in connection with prior projects should be furnished as a part of the response to the request for proposal. In any significant project, the inquiry should be made as to the limits and breadth of coverage as well as any claims history. Generally, insurance policies protecting professionals in consulting firms are "claims made" and it is important that there be a favorable claims history.
Interviewing the Consultant
Wherever possible, the consultant should be carefully interviewed.
Face to Face Meeting
As discussed earlier, reviewing references, statements of qualifications and the resumes of key personnel are crucial steps that assist the lawyer and the client in the final selection of a consultant. However, a meeting with proposed project personnel is probably the most useful step in making the final selection. A face to face meeting, in conjunction with probing questions, may serve to eliminate consultants who appear qualified yet truly lack the experience required for the project. The lawyer or the client should provide the consultant as much technical data about the assessment or project as possible before the meeting.
The Interviewing Team
The lawyer and client should together select an interviewing team composed of those who can truly assist in the selection process. This may include in-house or outside counsel, corporate environmental staff or even human resources and public or investor relations staff. If the clean-up involves an insurance carrier or is being charged to another party, involving personnel from the insurance company or other party may generate goodwill and prevent subsequent complaints concerning cost, although such involvement may well constitute a waiver of the attorney-client privilege. In a transactional setting, it may be desirable to include representatives from the other party to the transaction, whether that be lender, purchaser or seller, or landlord or tenant. Involving parties who may or may not be potentially adverse to the lawyer or client may be a difficult proposition, but, in the long run, may avoid difficulty, dispute or even litigation.
Authority for Decision Making
The lawyer and client should be clear with one another from the outset about who will select the consultant. It may be helpful to that decision if the responsible lawyer actually coordinates the interview process or at least has a say in the decision-making. Too often the client will select a civil or other engineer even to coordinate the selection process, even though that engineer may not have the requisite qualifications. While a good civil engineer can be an asset to the selection process, the ultimate authority should almost always be held jointly with the client and lawyer.
Conducting Interviews
Before interviews are conducted, the client and lawyer should carefully evaluate what the consulting firms have concluded about the nature and scope of the environmental concerns and the alternatives for assessment or remediation. Is one consulting firm urging a comprehensive approach in order to justify a high fee estimate? Is a particular consulting firm quoting a low cost in order to get the work only to charge for additional services later? The lawyer and client should jointly develop a list of key questions which will be asked of each of the consulting firms being interviewed in order to ferret out the answers to these and other questions.
Communication Skills
As indicated earlier, communication skills, including writing samples, should be evaluated and analyzed. The interviewing team should evaluate the consultant's writing samples for clarity, conciseness, persuasiveness and knowledge of current developments. During the interview, counsel should evaluate the communication skills of key personnel to determine whether one or more of these key personnel would make an effective witness in the event of litigation and, if the report is intended to be reviewed by management, lenders or other third parties, whether the consultant could effectively make presentations to these parties.
Conclusion
The preparation of the request for proposal, review of the responses and conduct of interviews is the most important aspect in the selection process for environmental consultants. Once this process is complete, the client and lawyer are ready to enter into an agreement with the consultant, the provisions of which will be discussed in the next installment of this article.