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Guidance emphasizes control of contracts, preventing the ESCO from adding or removing terms, and using leverage to avoid mismatched risk allocation. 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If both sides cannot agree up front, the project should not continue.","Answer",{"name":111,"@type":106,"acceptedAnswer":112},"Why does the timing of IGA signing matter for ESCO payment?",{"text":113,"@type":109},"ESCOs are not paid for work, time, or effort until the IGA is signed. If the governmental unit pauses construction, the process must be repeated later, reducing interest from ESCOs.",{"name":115,"@type":106,"acceptedAnswer":116},"How should the owner manage IGA costs and ECM selection?",{"text":117,"@type":109},"The owner should use the IGA Scope to narrow the work and focus on ECMs expected to cashflow within the project. 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A great deal of work went into compiling this information into a single location. As you go through this program and/or have additional questions, please contact Reid Conway [reid.conway@ncdenr.gov](reid.conway@ncdenr.gov).  \n GESPC-U Lesson \\#106::  \nFinal RFP and Beginning IGA: The Recipe to Success  \nFYI: Terms and Acronyms can be found on the last page  \nSummary: Completion of the RFP phase and an introduction to the IGA.  \nPrior to beginning the IGA and as the final work of the RFP phase, the owner will want to make sure that the ESCO has agreed to the language found within the IGA Contract, IGA Schedules and the ESA. There is no need to go down the road with any project if both sides cannot agree to the terms of the contracts up front. While the ESCOs say that they agree to all the terms of the contracts, we still see from time-to-time ESCOs that want to add or take out language. When this happens, it is often about risk or moving risk. This could cause the governmental unit to assume more risk than necessary and thus this risk is moved on the taxpayers. Not a good thing. If more risk is on the taxpayer, then less is on the ESCO. Again, not a good thing.  \nSince to this point the ESCOs have not been paid for any work, time, or effort until the IGA is signed. Remember the governmental unit is not obliged to move forward at this time. But the project will not be done via performance contracting and the governmental unit will have to go back through this whole process again at a later date. And will probably have fewer ESCOs interested in spending money a second time with no results. If getting things fixed is the goal, then this is the perfect time to resolve issues.  \nIf the governmental unit and their legal folks like the contracts, then I would not allow the ESCO to change anything. Again, you are in control. Take control of the contracts. As discussed in the last Lesson, you can move down the list to the next ESCO if the one doesn’t agree to the terms of the contracts. Again, you have leverage. Use it as necessary. Don’t be bullied by some national corporation. If you let the ESCOs know up front that these are our contracts and you either accept them or walk away. 99.9 times out of 100 they will accept these contracts and move forward.  \nYou will need approval from SEO for any changes or alterations to the template contract language for all contract documents . During the IGA, SEO is required to attend meetings and is required to review all documentation created as part of the IGA.  \nFor all governmental units this is the first signed contract that requires the GU to pay a cost for the IGA. Again, this is a negotiated cost and so is the scope. If for some reason the governmental unit does not want to move forward into construction, then the ESCO is paid for the work performed as part of the agreed to scope of the IGA. Note: See contract language for the GU terms not to pay for ESCO failure.  \nAs for this agreement, the GU and the ESCO will work together to determine the scope of the audit. Note: If the GU does not have expertise on staff, then SEO recommends hiring a qualified 3 rd party to help during the IGA. Remember that the ESCOs during the RFP only spent a very limited amount of time (often less than an hour) in your facilities. During the IGA, the ESCOs will spend weeks combing through utility data, prints, mechanical and electrical rooms looking for energy saving and projects. The GU will need to devote time to help in this effort because the GU staff will know what is broken and what needs tobe done and, in many cases, what is planned to be done in the future. All of this is important information to the ESCO and this project.  \nLet’s talk about cost or what makes up the costs of the IGA. The ESCOis using this time to engineer, design and ","cbCail6hf9xYAPAQ","https://ap.wps.com/l/cbCail6hf9xYAPAQ","pdf",271848,8,"English","# Summary\n## Confirming contract language before beginning the IGA\n## Payment timing and implications of not proceeding\n## Owner control, approvals, and SEO requirements\n## Audit scope, cost composition, and ECM cashflow focus\n## IGA contract and schedules/exhibits requirements","[{\"question\":\"What should the owner confirm before beginning the IGA?\",\"answer\":\"The owner should ensure the ESCO agrees to the language in the IGA Contract, IGA Schedules, and the ESA. If both sides cannot agree up front, the project should not continue.\"},{\"question\":\"Why does the timing of IGA signing matter for ESCO payment?\",\"answer\":\"ESCOs are not paid for work, time, or effort until the IGA is signed. If the governmental unit pauses construction, the process must be repeated later, reducing interest from ESCOs.\"},{\"question\":\"How should the owner manage IGA costs and ECM selection?\",\"answer\":\"The owner should use the IGA Scope to narrow the work and focus on ECMs expected to cashflow within the project. Knowing this early helps keep the IGA cost lower.\"}]","GESPC-U Lesson - 106 - Final RFP and Beginning IGA: The Recipe to Success | PDF",1789568694]