The Authority should issue a draft Payment Mechanism Schedule and a model to bidders at ISDS stage.
The Payment Mechanism Schedule should include drafting on all key commercial terms, including the definition of the Minimum and Maximum Tonnages and a fully developed set of Performance Standards. See Part II of this Module 4 for suggested drafting to assist in the development of a project specific draft Payment Mechanism Schedule.
The model should be developed by the Authority to allow both an assessment of the financial implications of different waste flow scenarios and levels of Contractor performance. The process of developing a model is also a useful discipline in terms of specifying the precise method of calibrating each component of the Unitary Charge.
Authorities are advised to include worked examples for the proposed Payment Mechanism, ideally for each of the Performance Standards, to issue alongside the Payment Mechanism Schedule as part of the ISDS.