2022-10-11 Services & Organisation Committee Agenda

SERVICES & ORGANISATION COMMITTEE MEETING AGENDA                            11 OCTOBER 2022


      and technologies are proposed.
     The respondent’s Service Plan achieved the highest score, in part due to the significant
      advantages of its larger vessel’s capacity and the operational benefits that will provide;
     The respondent outlines a commitment to work with Council to maintain service standards
      and to identify, adapt and innovate in response to changing needs.
     While the fully-offset carbon emissions proposal is a lesser outcome to avoidance of
      emissions through sourcing renewable power, it does align with Council’s Zero Emissions
      Strategy and the respondent outlines a willingness to convert to electric propulsion in
      future in response to environmental or financial imperatives.
     AEC’s independent financial assessment finds it will provide the strongest financial return
      with the least level of financial risk, as further outlined below.
7.    Financial Assessment
Independent financial assessment of the submissions was undertaken by AEC Group
consulting. AEC assessed the financial capabilities of the tenderers and associated parent
companies, with scoring for these included in the tender assessment summaries.
Detailed assessment and sensitivity analysis was undertaken for the submitted prices and
revenue share percentages, with AEC confirming:
Divers Den Investments Pty Ltd offers the least cost tender options for the Noosa Ferry service
under base case demands and pricing in addition to under scenarios involving reduced
demands or higher crossing fees, with its larger ferry tender option having the lowest cost of all
tender options submitted.
AEC’s assessment further confirmed DDI’s 20-year contract term price option for the larger
vessel as the lowest cost option, with the longer term resulting in an annualised cost that is
significantly lower than a shorter 10 year term, in the vicinity of a 30% differential.
8.    Tender Recommendation
The weighted tender evaluation summary sheet is included as Attachment 1. Divers Den
Investment’s alternate tender for the larger vessel (described as Tender 2 in this report) is
identified as the preferred submission and AEC finds the 20-year term as the most financially
beneficial. The recommendation is worded accordingly.
9.    Related Issue - Moorindil Street Road Upgrades
Council’s Infrastructure Services Department advises that funding has been allocated in the
current financial year budget to design upgrade works to Moorindil Street. The project intent is
to add a second northbound lane to the Moorindil Street approach to the ferry landings,
extending approximately 600m south. New pedestrian and cycle facilities are also proposed.
The design development will be assisted by Holland Traffic Consulting, Council’s traffic expert,
who is familiar with the ferry operation having provided an assessment as part of the tender
package. Award of the ferry tender service will allow the design to be reflect the benefits of the
new vessels and to gain input from the new operator if required.
10.   Related Issue – Review of Ferry Fees
The recommended tender price is above the current contract budget. This outcome aligns to
the recent independent assessment review. As also indicated in previous reports and updates,
increases to crossing fees may be required to ensure the service remains revenue positive and
avoids the need for ratepayer subsidisation. Following award of the new contract, staff will
commence a review of fee structures to be considered by Council in a future report. Notably, a
fee increase would align with increased levels of service for customers addressing handling
capacity issues and new payment options under the new contract. Any fee review will also
consider optimal pricing for different categories of customer.




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