Oklahoma § 62-318 - Performance-based efficiency contracts

§ 62-318. Performance-based efficiency contracts

A. For purposes of this section:

1. "Public entity" means any political subdivision of this

state, or a public trust which has as a beneficiary a political

subdivision of this state, or any institution of higher education

which is part of The Oklahoma State System of Higher Education;

2. "Performance-based efficiency contract" means a contract for

the design, development, financing, installation and service of any

improvement, repair, alteration or betterment of any building or

facility owned, operated or planned by a public entity; or any

equipment, fixture or furnishing to be added to or used in any such

building or facility; or any maintenance or operational strategy

that is designed and implemented that will reduce utility

consumption or lower operating costs, result in annual operating

cost savings, generate additional revenues or avoid capital cost

incurrence and may include, but is not limited to, one or more of

the following:

a.

utility services,

b.

heating, ventilating or air conditioning system

modifications or replacements and automated control

systems,

c.

replacement or modifications of lighting fixtures,

d.

indoor air quality improvements to increase air

quality that conform to the applicable state or local

building code requirements when done in conjunction

with other cost-saving measures,

e.

any additional building infrastructure improvement,

cost saving, life safety or any other improvement that

Oklahoma Statutes - Title 62. Public Finance

provides long-term operating cost reductions and is in

compliance with state and local codes,

f.

water-metering devices that increase efficiency or

accuracy of water measurement and energy reduction, or

g.

any facility operation and support programs that

reduce operating cost;

3. "Qualified provider" means a person or business experienced

or trained in the design, analysis and installation of energy

conservation and facility management measures. A qualified provider

must employ a professional engineer registered in the State of

Oklahoma; and

4. "State governmental entity" means the State of Oklahoma or

any agency, board, commission, authority, department, public trust

of which the state is the beneficiary or other instrumentality of

state government, other than a public trust with the state as

beneficiary whose jurisdiction is limited to one county, including,

but not limited to, the following:

a.

Oklahoma Municipal Power Authority,

b.

Oklahoma Development Finance Authority,

c.

Oklahoma Industrial Finance Authority,

d.

Grand River Dam Authority,

e.

Oklahoma Water Resources Board,

f.

Northeast Oklahoma Public Facilities Authority,

g.

Oklahoma Turnpike Authority,

h.

Oklahoma Housing Finance Authority, and

i.

Oklahoma Public, Industrial and Cultural Facilities

Authority.

B. In addition to any other legally permissible alternatives of

entering into contracts, any public entity may enter into

performance-based efficiency contracts with a qualified provider

pursuant to the provisions of this section. The public entity may

make an initial payment from any funds available. Further, any

public entity may enter into an installment contract, lease purchase

agreement or other contractual obligation for the purpose of

financing performance-based efficiency projects for a term not to

exceed the greater of twenty (20) years or the useful life of the

project. A qualified provider to whom the contract is awarded shall

be required to give a sufficient bond to the public entity for its

faithful performance of the contract. In addition, the public

entity may require performance bonds covering the annual amount of

guaranteed savings over the contract term.

The contract's cost savings to the public entity must be

guaranteed each year during the term of the agreement. The savings

must be sufficient to offset the annual costs of the contract. Any

initial payment from funds other than an installment agreement must

also be offset by savings, as described herein, over the term of the

agreement. In calculating cost savings, the public entity may

Oklahoma Statutes - Title 62. Public Finance

consider capital cost avoidance and include additional revenue that

is directly attributed to the performance-based efficiency contract.

The contract shall provide for reimbursement to the public entity

annually for any shortfall of guaranteed savings. Savings must be

measured, verified and documented during each year of the term and

may be utilized to meet the annual debt service. This section shall

constitute the sole authority necessary to enter into performancebased efficiency contracts, without regard to compliance with other

laws which may specify additional procedural requirements for

execution of contracts.

Added by Laws 2001, c. 436, § 1, emerg. eff. June 8, 2001. Amended

by Laws 2004, c. 299, § 2, eff. Nov. 1, 2004; Laws 2015, c. 267, §

1, eff. Nov. 1, 2015; Laws 2018, c. 296, § 3, eff. Nov. 1, 2018;

Laws 2023, c. 77, § 1, emerg. eff. April 26, 2023.