BOND COUNSEL SERVICES
Request For Proposals (RFP) No. 840

The New York State Energy Research and Development Authority ("NYSERDA") invites proposals from law firms interested in providing bond counsel and related services to NYSERDA in connection with its past and future issuance of bonds, notes, and other obligations ("bonds") of NYSERDA.

Proposers must submit one signed original and five (5) copies of the proposal with a completed Proposal Checklist attached to the front of the signed original and each copy. Proposals must be clearly labeled and submitted to:

Karen Whalen, RFP No. 840
NYSERDA
17 Columbia Circle
Albany, NY 12203-6399

Questions can be directed to Mary Sauvie at 1-866-NYSERDA, ext. 3229, or mks@nyserda.org.

* Proposals are due Eastern Time. Late proposals and proposals lacking a completed and signed Proposal Checklist will be returned. Faxed or e-mailed proposals will not be accepted. Proposals will not be accepted at any other NYSERDA location other than the address specified above.

I. INTRODUCTION

The Authority is a public benefit corporation of the State of New York created and operating under the provisions of Public Authorities Law, §§1850 et. seq. (the "New York State Energy Research and Development Authority Act" or "Act"). The purposes and powers of the Authority include conducting energy research, development, and demonstration programs; managing radioactive wastes and facilities at the Western New York Nuclear Service Center in West Valley, New York; managing certain premises and facilities at a former federal rocket test station in Malta, New York; administering an Energy Efficiency Services program, a Residential Energy Affordability Program, an Energy Analysis program, a System Benefits Charge Program, and a Radioactive Waste Policy and Nuclear Coordination program and reducing costs of public utility and other energy facilities through tax-exempt or taxable non-recourse revenue bond financing.

Currently, the Authority has outstanding approximately $3.7 billion in tax-exempt bonds issued on behalf of New York State investor-owned utilities, estimated to save ratepayers more than $3.2 billion in interest costs over the lives of the bonds. The Authority also has outstanding over $55 million in tax-exempt and taxable state service contract revenue bonds issued to finance costs incurred at the Western New York Nuclear Service Center.

II. ISSUES

During the last five fiscal years, the Authority's financing program has consisted of the following new issues:

During these periods, the Authority periodically participated in, and engaged the services of bond counsel for, transactions related to letter of credit substitutions, replacements of remarketing agents, and other interest rate conversions, the addition of credit facilities and other activities.

Additional background information on NYSERDA, including by-laws and official statements for recent Authority financings, is available from NYSERDA upon request.

III. SCOPE OF SERVICES

NYSERDA requests proposals from law firms interested in being selected to be one of up to three law firms that are used to provide bond counsel and related services to NYSERDA. The firm or firms selected will be expected to act as bond counsel for NYSERDA on and for all aspects of bond issues, as assigned, for a period of up to five years beginning on or about January 26, 2004 through December 31, 2009. Such services would be expected to include, but need not be limited to:

(a) Negotiating, preparing, reviewing, and delivering any documents related to financings, including but not limited to project financing agreements, participation agreements, trust indentures, bond purchase agreements, and tax regulatory agreements, and advising on appropriate covenants for inclusion in agreements between the Authority and the other involved parties.

(b) Preparing or reviewing preliminary official statements, official statements, and other disclosure documents necessary or appropriate to the authorization, issuance, sale, or delivery of bonds.

(c) Rendering an objective opinion with respect to any authorization and issuance of or conversion of the interest rate on bonds; the delivery of new or revised letters of credit and other liquidity and credit facilities; refinancings; appointment or substitution of remarketing agents, market agents, trustees, auction agents, and other parties to a bond issue; and amendment of related documents, including required bond counsel opinions on the exclusion of interest paid on the bonds from gross income for federal income tax purposes and for state and local income tax purposes, as appropriate.

(d) Advising on federal and state tax and securities law matters and changes thereto, the investment and expenditure of bond proceeds, and the collection, investment, and application of monies used to pay debt service on bonds.

(e) Preparing, reviewing, or advising the Authority with regard to resolutions, notices, and other documents or procedures required in connection with financings.

(f) Advising on federal tax law arbitrage rebate requirements, as appropriate.

(g) Drafting, analyzing, advising, or commenting on federal and state legislation, regulations and rules, Authority guidelines, and other matters which may have an impact on the financing program.

(h) Participating in meetings with utilities and other potential borrowers, rating agencies, underwriters, the Authority's Members (board of directors) and Audit and Finance Committee, and other parties, as necessary or appropriate.

(i) Assisting with preparation of schedules for the issuance of bonds and assignment of responsibilities of involved parties.

(j) Providing any other legal services, advice, or opinions as requested relating to the Authority's financing program.

The firm or firms selected as bond counsel would also be expected to provide its services on bond issues closed up to December 31, 2009.

IV. PROPOSAL REQUIREMENTS

PART I

Proposers must submit five (5) copies of the proposal. A completed and signed Proposal Checklist must be attached to the front of all copies. At least one copy of the Proposal Checklist must contain an original signature and NYSERDA will not accept proposals that do not contain a completed and signed Proposal Checklist. All proposals submitted in response to this solicitation must include a completed Disclosure of Prior Findings of Non-responsibility. In compliance with Executive Order 127, for proposals submitted in response to this solicitation, an additional form (or forms) must be completed and filed: (1) A Disclosure of Lobbyist form (if applicable) and (2) a Disclosure of Prior Findings of Non-responsibility form (see below, VI. General Conditions - Executive Order 127). Proposals should not be excessively long or submitted in an elaborate format that includes expensive binders or graphics. Unnecessary attachments beyond those sufficient to present a complete, comprehensive, and effective response will not influence the evaluation of the proposal. Each page of the proposal should state the name of the proposer, the RFP number, and the page number. Each offer should be submitted using the most favorable cost and technical terms. NYSERDA reserves the right to request additional data or material to support proposals. All material submitted in response to this RFP will become the property of NYSERDA.

The proposal must be in the following format:

Proposals must be submitted in two parts. Part I must consist of responses to the management and qualifications items [IV(A) below]. Part II must consist of complete contract cost and pricing information [IV(B) below]. Each part must be complete, so that it can be evaluated independently.

A. Management and Qualifications. In setting forth its qualifications, each interested firm should provide, in concise but adequate detail, the information sought below.

1. For the years 2000, 2001, and 2002 state:

(a) the number and dollar volume of revenue bond issuances by New York State, local governments in New York State, or State or local public authorities or public benefit corporations in New York State for which your firm acted as bond counsel, co-bond counsel, underwriters counsel, underwriters co-counsel, tax counsel, or special counsel;

(b) the number and dollar volume of public utility or special energy project revenue bond issuances and electric power and related facilities revenue bond issuances for which your firm acted as bond counsel, co-bond counsel, underwriters counsel, underwriters co-counsel, tax counsel, or special counsel; and

(c) the interest rate modes allowable, security, and the basis for the firm's fees (for example, hourly rate or a percentage) for each of the issues included in the answers for A (1)(a) and (b) above.

The issues should be separately categorized by the legal function performed, i.e., bond counsel, co-bond counsel, underwriters counsel, underwriters co-counsel, tax counsel, or special counsel; public utility, special energy project, and appropriation-backed service contract revenue bond issuances should be separately grouped. The dollar volume of each category should be stated, with issues totaling $100 million or more separately identified, and the nature of any special counsel function should be described. The method by which your firm was selected to provide such services (for example, sole source, request for proposals, etc.) should also be listed.

2. State the names of the partners and associates in the public finance group in the firm and in the tax subgroup therein.

3. State the names of the partners, associates, and paralegals who would be assigned to the Authority's account, provide their resumes, the location of their primary office, and describe their anticipated commitments to other clients during the next 12 months.

4. Describe the experience and expertise of the firm in dealing with arbitrage and rebate issues arising under the Internal Revenue Code with respect to public financings.
5. State the experience and expertise of the firm in dealing with the issuance of non-fixed rate debt and "derivative" obligations (describe the particular issues and the legal function of the firm).

6. Describe the experience of the firm in obtaining rulings from the Internal Revenue Service on bond issuance-related matters.

7. Describe any subjects related to bond counsel services in which you feel your law firm has special expertise and the nature of that special expertise.

8. Describe the resources available within the firm to assist the Authority in its dealings with federal and New York State agencies and legislative bodies with respect to matters bearing on its financing program.

9. State whether the firm has participated as counsel in any federal or New York State utility ratemaking proceedings. If so, state the particulars thereof.

10. Provide a brief description of services you expect to provide to the Authority. Indicate whether your firm is prepared to render the services enumerated in this RFP using its own resources. (The Authority will not permit any bond counsel services to be subcontracted or assigned to third parties.) The description should emphasize particular services to be provided with respect to public finance and tax work as it relates to the issuance of federal, State, and local, or State and local, tax-exempt obligations by the Authority as a governmental issuer.

11. Describe your firm's experience and expertise with general representation of public entities, including particularly New York State public benefit corporations or public authorities.

12. Provide three client references, including names of contacts and telephone numbers.

13. Describe the type of word processing equipment to be utilized, and its ability to interface with other off-site equipment for electronic mail purposes (both sending and receiving).

14. Identify the nature of any potential conflict of interest your firm might have in providing bond counsel services to the Authority:

(a) State whether your firm represents any New York State energy public utility, public authority or any independent power producer. If so, state the name of each such client and the nature of your representation.

(b) Discuss fully any conflicts of interest, actual or perceived, which might arise in connection with your firm's involvement with the Authority. If conflicts do or might exist, describe how your firm would resolve them. Please be aware that the firm selected will be expected to represent the Authority in all transactions within its financing program; representation of any other party to a transaction involving the Authority would be prohibited without the express written approval of the Authority, which would be unlikely.

15. Identify any litigation or administrative proceedings to which you are a party and which would either materially impair your ability to perform the services enumerated herein and for which this RFP was issued or, if decided in an adverse manner, materially adversely affect the financial condition of your firm.

16. Furnish information on the number and percentages of minorities and women among the partners and other attorneys of the firm, as well as para-professional and support staff; a copy of the firm's affirmative action or equal opportunity plan or other commitment to affirmative action and equal employment opportunity or its status as a minority or women-owned business; and an explanation of how your firm, if selected, would help the Authority further its policy of promoting participation of minorities and women in the provision of services to it, including services in support of its financing program.

17. Indicate whether the address of the office through which the Authority's account will be primarily serviced, and any anticipated travel or other such costs.

18. Provide any other information you believe would make your law firm's representation of the Authority superior to other firms' representation.

PART II

B. Cost.

1. State the rates at which the services of partners, associates, and non-attorney law clerks, paralegals, or other paraprofessionals would be provided to the Authority during the periods January 26, 2004 to March 31, 2004, the Authority fiscal years (April 1st through March 31st) 2004-05, 2005-06, 2006-07, and 2007-2008, and the period April 1, 2008 - December 31, 2008, which partners and associates are expected to perform which services, to the extent reasonably projectable, and how these services would be billed. (Indicate whether the firm will commit now to rates for fiscal years 2004-05, or 2005-06 or 2006-07. Increases, if any, for those years may be stated in terms of percentages above the rates for January 26 through March 31, 2004.) Include:

(a) For each attorney whose resume is provided in response to IV(A)(3) above, your normal hourly rate and the hourly rate you propose to charge the Authority.

(b) Projected services to be provided by each attorney whose resume is provided in response to IV(A)(3) above, to the extent available.

(c) For each applicable category of non-attorney law clerk, paralegal, or other paraprofessional, your normal hourly rate and the hourly rate you propose to charge the Authority.

(d) Costs of any anticipated clerical support, if billed separately.

(e) A schedule of all disbursements which you anticipate will result in a charge to the Authority and the rate for each.

(f) Any reduced rates or fees charged other State or local public finance issuers in New York.

(g) A statement whether you would be willing to agree to caps on fees on an issue by issue basis.

In responding to this item IV(B)(1), provide one or more of the following, in respondent's order of preference: (I) a single hourly rate for all partners and a separate single hourly rate for all associates; (ii) a blended hourly rate for all partners and associates; and (iii) the individual hourly rates for each partner and each associate.

2. State the bases on which any other firm expenses related to services provided to the Authority would be billed, if other than cost.

3. State the specific maximum overall dollar limit which the firm would accept on fees and expenses for each of two hypothetical individual bond issues: one a new money issue and the other a refunding issue, each in the principal amount of $100 million. Indicate the projected number of hours of involvement by partners, associates, etc. Indicate if either dollar limit would differ if the principal amount of the bond issue were to be higher or lower and, if so, how. For purposes of developing these dollar limits, assume: (a) each bond issue would be sold at a fixed interest rate, with no variable rate or derivative features, (b) normal arbitrage and rebate matters would be addressed, and (c) the bond issue would not involve any unusual or complex matters. Each dollar limit must include all costs of operations the proposer would expect to recover, including secretarial, office equipment, fringe benefits, indirect cost rates, etc.

4. State any special considerations with respect to billing or payment of fees and expenses that your firm offers and that you believe would differentiate it from other proposers and make your firm's services as bond counsel or co-bond counsel more cost effective for NYSERDA.

V. PROPOSAL EVALUATION

A. Evaluation Factors. In evaluating proposals submitted in response to this RFP, NYSERDA will consider the following factors.

1. Anticipated cost of services and willingness to work with NYSERDA to minimize costs. (Although proposed fees will be taken into account in the selection process, NYSERDA reserves the right to negotiate lower fees or different fee structures than proposed with any firm selected). (25 points)

2. Quality and depth of the firm's expertise and its prior capability in providing similar services, including, but not limited to, past performances on projects and programs in New York of magnitude or complexity comparable to or greater than NYSERDA's. For those firms who have worked as counsel in any capacity with NYSERDA, the quality of work on those transactions will be considered. (20 points)

3. Experience in general and, in particular, as bond counsel on behalf of issuers like NYSERDA, especially in transactions similar to the types NYSERDA has entered into and obligations of the types NYSERDA has issued. The firm selected for bond counsel must be nationally recognized bond counsel experienced in the subject areas of public finance and tax laws and regulations. (20 points)

4. Commitment of time, resources, and ideas to NYSERDA and availability to and facility for working with Authority attorneys and financing program staff. (15 points)

5. Information provided by client references. (10 points)

6. Involvement of the proposing firm in financings with innovative legal issues, which demonstrates any unique qualifications as bond counsel. (5 points)

7. Overall organization and quality of proposal, including cohesiveness, conciseness, and clarity of response. (5 points)

B. Selection Process. A selection committee consisting of Authority staff will review and evaluate proposals and develop a short list for further consideration. Firms so selected may be requested to submit sample financing documents that they have prepared. Firms so selected may also be invited to make oral presentations to Authority staff and any members of the Audit and Finance Committee of NYSERDA who wish to participate. The staff will then make a recommendation to the Audit and Finance Committee, which will make a recommendation to the Members of NYSERDA.

The Members will make the final selection, subject to the provisions of Section 1853 of the Public Authorities Law. It is anticipated that proposers will be notified by January 31, 2004 of the results of the RFP process. Winning proposers will be assigned to work on proposed transactions by NYSERDA on a case-by-case basis.

VI. GENERAL CONDITIONS

Proprietary Information - Careful consideration should be given before confidential information is submitted to NYSERDA as part of your proposal. Review should include whether it is critical for evaluating a proposal, and whether general, non-confidential information, may be adequate for review purposes.

The NYS Freedom of Information Law, Public Officers law, Article 6, provides for public access to information NYSERDA possesses. Public Officers Law, Section 87(2)(d) provides for exceptions to disclosure for records or portions thereof that "are trade secrets or are submitted to an agency by a commercial enterprise or derived from information obtained from a commercial enterprise and which if disclosed would cause substantial injury to the competitive position of the subject enterprise." Information submitted to NYSERDA that the proposer wishes to have treated as proprietary, and confidential trade secret information, should be identified and labeled "Confidential" or "Proprietary" on each page at the time of disclosure. This information should include a written request to except it from disclosure, including a written statement of the reasons why the information should be excepted. See Public Officers Law, Section 89(5) and the procedures set forth in 21 NYCRR Part 501.

Omnibus Procurement Act of 1992 - It is the policy of New York State to maximize opportunities for the participation of New York State business enterprises, including minority- and women-owned business enterprises, as bidders, subcontractors, and suppliers on its procurement Agreements.

Information on the availability of New York subcontractors and suppliers is available from:

Empire State Development
Division For Small Business
30 South Pearl Street
Albany, NY 12245GENERAL CONDITIONS, Continued

A directory of certified minority- and women-owned business enterprises is available from:

Empire State Development
Minority and Women's Business Development Division
30 South Pearl Street
Albany, NY 12245

Executive Order 127 - NYSERDA is required to comply with the provisions of Executive Order 127. The Executive Order is available at www.gorr.state.ny.us/gorr/eo127_fulltext.htm. Pursuant to the Executive Order, proposals submitted in response to this solicitation should include:

(1) the name, address, telephone number, place of principal employment and occupation of every person or organization retained, employed or designated by or on behalf of the proposer to attempt to influence the procurement process and whether such person or organization has a financial interest in the procurement. If a proposer has identified one or more such persons or organizations, a Disclosure of Lobbyist form (which is available upon request or at http://www.nyserda.org/stdforms.html) must be completed and filed with the proposal for each person or organization identified.

(2) a disclosure statement regarding proposer's history of findings of non-responsibility made by any agency or authority within the previous five years where such prior finding of non-responsibility was due to intentional provision of false or incomplete information to a covered agency or authority with respect to Executive Order 127. All proposals submitted in response to this solicitation should include a completed Disclosure of Prior Findings of Non-responsibility form (which is also available upon request or at http://www.nyserda.org/stdforms.html).

If a proposer fails to disclose accurate and complete information outlined in 1 or 2 above in a timely manner or otherwise fails to cooperate with NYSERDA in the implementation of Executive Order 127, NYSERDA shall consider this in its determination of the responsibility of such proposer. After submitting a proposal in response to this solicitation, proposers should recognize that disclosure of such information contained in paragraph number 1 above is an ongoing responsibility and that failure to comply with Executive Order 127 may lead to the
termination of a contract.

Contract Award - NYSERDA anticipates making up to three awards under this solicitation. It ay award a contract based on initial applications without discussion, or following limited discussion or negotiations. Each offer should be submitted using the most favorable cost and technical terms.

NYSERDA may request additional data or material to support applications. NYSERDA expects to notify proposers whether your proposal has been selected to receive an award after its January 2004 meeting, which is currently scheduled for January 26.

Limitation - This solicitation does not commit NYSERDA to award a contract, pay any costs incurred in preparing a proposal, or to procure or contract for services or supplies. NYSERDA reserves the right to accept or reject any or all proposals received, to negotiate with all qualified sources, or to cancel in part or in its entirety the solicitation when it is in NYSERDA's best interest.

Disclosure Requirement - The proposer shall disclose any indictment for any alleged felony, or any conviction for a felony within the past five years, under the laws of the United States or any state or territory of the United States, and shall describe circumstances for each. When a proposer is an association, partnership, corporation, or other organization, this disclosure requirement includes the organization and its officers, partners, and directors or members of any similarly governing body. If an indictment or conviction should come to the attention of NYSERDA after the award of a contract,

NYSERDA may exercise its stop-work right pending further investigation, or terminate the agreement; the contractor may be subject to penalties for violation of any law which may apply in the particular circumstances. Proposers must also disclose if they have ever been debarred or suspended by any agency of the U.S. Government or the New York State Department of Labor or have had their license to practice law in the State of New York suspended.

Attachments:

Attachment A - Proposal Checklist
Attachment B - Disclosure of Lobbyist form
Attachment C - Disclosure of Prior Findings of Non-responsibility form

17 Columbia Circle, Albany, NY 12203-6399    Toll-Free: 1-866-NYSERDA or Local: 518-862-1090    Fax: 518-862-1091
New York City and Buffalo Regional Offices

© 2004 New York State Energy Research and Development Authority