The real cost of maintaining a perfect track record

Published September 13th, 2018

US contract operations firm Utility Partners has maintained its 100% contract retention rate since being acquired by H2O Innovation just over two years ago, albeit after negotiating reduced fees on both its most recent renewals.

In Gulfport, Mississippi, the company extended its existing $7 million-a-year water and wastewater operating contract by a further two years, adding a valve technician as part of a scope addition. At the same time, it agreed to waive up to 1.5% of the CPI increase for 2018, saving the City up to $105,000 a year.

Meanwhile in Pascagoula, Mississippi, the company negotiated a $3.3 million one-year extension, but agreed to drop the annual fee by half a million dollars after the City consolidated the company’s existing public works and ditch maintenance contracts.

With relatively few new contracts to pursue, it seems contract operators are increasingly willing to accept concessions in order to extend existing agreements.