2022-03-14 General Committee Meeting Agenda

GENERAL COMMITTEE MEETING AGENDA   14 MARCH 2022




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GENERAL COMMITTEE MEETING AGENDA                                                                          14 MARCH 2022

 Option 2 — Contractor Owned Vessels
           NOOSA NORTH SHORE FERRY REVIEW                                                                                                                                          3
                                                                                                                                                                            AEC >

    Fixed Fee for Service plus Revenue Share
   Operational/    Council utilises a contractor with the requisite ferry / marine industry experience to Less flexibility to adapt to current and future Council plan and strategy adoption requiring Medium (M32)
   Service        operate the service.                                                              negotiation and potential compensation should contractual requirements not be clear or
    Delivery       Technology improvements to improve the customer experience (EFTPOS, booking       need to be amended.
                   systems, etc.) can be advanced via conditions in the new contract.                Ongoing customer and or political enquiries / complaints relating to the ferry operation. Medium (M28)
                   Council will remain to some extent at arm’s length regarding the ferry operation and day-
                   to-day issues.
                   Council can, via conditions in the new contract, ensure the contractor handles the day-
                   to-day customer service enquiries / complaints relating to the ferry operation.
                   Contractor performance monitoring against service benchmarks / KPI's will be able to be
                   conditioned in the new contract.
   Govemance/      Procuring a contractor with the required expertise in the marine / ferry regulatory Legitimate contractors are dissuaded from tendering under a fixed fee for service plus Medium (M52)
    Legal/         environment and operations will mitigate some legal and regulatory exposure.      revenue share mode! given associated financial risks.
   Regulatory      Contractor relationship management and performance will be guided via the new     Contractual renegotiation and financial compensation associated with potential State High (H72)
                   contract terms and conditions.                                                    Govemment imposed permits/restrictions.
                   Council still has an opportunity to undertake business planning to guide future contract Council is exposed to ICT security breaches if technology obligations are notpassedon —_— High (H72)
                   management performance.                                                           to the contractor.
                   Ferry marketing and communication can be delegated to the contractor via new contract
                   conditions.
    Human          Council will avoid the need to directly employ and manage staff under existing local Contractor may not be able to find suitable resources.                      Medium (M32)
    Resources      govemment awards / Council’s enterprise agreement conditions, reducing pressure on
                   intemal services and Property branch management.
   Financial/     Council will avoid the need for significant upfront capital funding required to procure new Je Financial exposure from reduced crossing volumes compared to budget forecast, High (M40)
    Economic       / upgraded ferry infrastructure (not currently included in 10-year capital investment including exposure to any State Goverment imposed permits/restrictions.
                  forecasts).                                                                        Current fees may not be sufficient to maintain Council's retum from the ferry operation § Extreme (E88)
                  Upside revenue fluctuation benefits resulting from increased crossing volumes above due to increased tender prices and capital costs associated with new ferry acquisitions.
                  budget forecast will be shared with the contractor, but annual price increases do not Contractor will tender a revenue share arrangement based on conservative demand High (H60)
                   fees is established (as per the current contract).
                   Financial efficiencies achieved by the contractor via employing staff under non-local
                   govemment awards should be reflected in tendered pricing.
   Asset           Asset management responsibilities will reside with the contractor.                ‘Asset sweating’ and resulting potential performance failures if contract conditions are High (H72)
                                                                                                     not explicit regarding asset management responsibilities.
   Political/                                                                                        Direct political intervention / adverse decision resulting in sub optimal commercial High (H60)
   Reputational                                                                                      outcomes and additional Council / Property branch staff pressure / workloads.

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