County government in Jackson Mississippi wants me to audit their Entergy accounts. The county administrator says contingency arrangements are fine under their procurement code as long as the total fee doesn't exceed $25,000 without going through the full RFP process. If my findings are large and 40% exceeds $25K, I'd have to stop or go through the RFP. Any way around this?
Fee structure for government accounts with procurement rules
Government procurement thresholds are real and you can't get around them — nor should you try. Two options: structure your contingency with a $25K cap to stay under the threshold, or if you think the recovery will be large enough to justify it, suggest the county issue a formal RFP that you respond to. Some counties will issue an RFP specifically tailored to utility auditing services if you help them understand what to include in the scope. It takes longer but removes the fee ceiling. I've done both approaches with Tennessee county governments.
Ed gives the correct guidance. Government procurement rules exist for good reason and working within them is essential. If the expected recovery is modest, a capped contingency under the procurement threshold is the fastest path. If the portfolio is large and the expected recovery substantial, investing the time in an RFP process gives you a longer-term relationship without fee restrictions. Government clients tend to be very loyal once you're in — the procurement process creates a barrier to entry that works in your favor once you're the incumbent.
Went with the capped contingency at $24,500 to stay under threshold. Found $52,000 in errors across 8 county buildings. My fee maxed at the cap — left some money on the table but it opened the door. County administrator is now drafting an RFP for ongoing utility management services with no cap. Playing the long game.