Memorandum
City of Lawrence
Utilities Department
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TO: |
David Corliss Debbie Van Saun |
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FROM: |
Philip Ciesielski |
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CC: |
Chris Stewart Michael Tubbs |
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Date: |
February 13, 2007 |
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RE: |
February 20, 2007 City Commission Agenda |
Please include the following item on the City Commission Agenda for consideration at the February 20, 2007 meeting:
Adopt Resolution No. 6704 and authorize the City Manager to set a bid date of March 27, 2007 for the Phase II Clinton Water Treatment Plant Expansion.
Project History:
Phase I of the Clinton Plant Expansion was completed in 2002 through a modified design build approach. Phase I of the expansion improved the raw water pumping, filtering capacity, transfer pumping and various electrical/mechanical systems. The phased implementation of the Clinton WTP expansion provided the flexibility to the City of Lawrence to meet seasonal demands without water restrictions and delay constructing infrastructure in advance of regulatory determinations which could impact the selection of treatment processes.
This a a significant Master Plan project expansion which will increase capacity to meet projected customer demands, improve reliability of the water treatment facility, and provide for future treatment processes if needed for upcoming regulations. The Phase II improvements will complete the expansion of the water treatment plant from a firm capacity of 10 million gallons per day (mgd) to 25 mgd and hydraulic capacity from 15 mgd to 30 mgd. The project will include new basins, high service pumping, electrical improvements and miscellaneous building/chemical feed improvements.
Project Status:
On February 22, 2005, the City Commission authorized the Utilities Department to solicit proposals for engineering services for the second phase expansion of the Clinton Water Treatment plant. A review committee consisting of staff within the Department of Utilities, Finance and the City Manager’s office reviewed the five proposals and recommended Black and Veatch as the firm most qualified to complete the engineering services. The City entered into a contract with Black & Veatch for $71,600 for preliminary design of the facility. At the completion of the preliminary design report, an opinion of probable cost was provided for the project as $15,460,000 for total project cost.
The City then entered into an Engineering Services Agreement with Black & Veatch for final design of the improvements for $1,050,000, followed by approval on 11/21/06 of a $30,000 increase for the design of a hypochlorite system as part of the improvements. Black & Veatch completed the design, prepared plans and specifications for the bidding of the construction phase, and prepared a current opinion of probable cost for construction of $16,700,000 based on the final design. Resident inspection and construction phase engineering services have not been negotiated at this time but are anticipated to be approximately $1,300,000. A recap of project expenses follows:
· $ 71,600 preliminary design
· $ 1,080,000 final design
· $ 1,300,000 estimated inspection/construction phase services
· $16,700,000 estimated construction costs
· $19,151,600 estimated total project costs
Also included in the updated construction cost estimate is approximately $500,000 associated with the excavation and disposal of the existing municipal solid waste that was previously deposited at the site. Due to a lack of information on the extent and nature of the solid waste, this cost was not defined at the time of the preliminary estimate. On site testing has been used to both quantify and qualify the expected nature of the solid waste. This recent testing information is the basis for the current estimate.
Black & Veatch has identified the following items contributing to the overall increase in the project cost:
· Sodium Hypochlorite and Carbon Dioxide Systems – The decision to switch to a sodium hypochlorite disinfection system for increased safety, with the associated carbon dioxide system to reduce finished water pH, resulted in an increase in construction cost of approximately $500,000.
· Basin Equipment – The basin equipment cost has increased approximately $600,000 over the preliminary quotes provided by the potential vendors. The primary reason is increase in steel cost and a review of the final specification requirements for the equipment.
· Sitework – Additional access roads and wider paved areas are being provided to enhance truck access. The additional paving created additional drainage requirements along with modifications to the site fencing. These additional items increased the total project cost by $200,000.
· Solid Waste Disposal – The previously mentioned $500,000 for excavation and disposal of the solid waste material at the site.
· Inflation - Inflation for water and wastewater treatment facility type construction has increased by 7.1% since last year. This is reflected in the basin equipment cost inflation listed above, but has also affected overall pricing.
· Design Definition – The remainder of the cost increase is associated with definition of the final design. The final estimate still includes 5% contingency ($750,000).
Project Schedule:
Updated Project schedule as presented by Black and Veatch:
Advertise - February/March 2007
Bid/ Award - March/April 2007
Construction - Plant expansion complete July 2008; final completion January 2009
Project Funding:
The project will be debt financed via revenue bonds. A previous resolution for bonding the project for $8,600,000 was submitted and approved at the April 5, 2005 City Commission meeting. The additional costs, per the updated estimates, will require additional bonding authority for $10,600,000. City staff is currently analyzing the entire Utility Department funding and rate structure in light of cost incresaes and shifting project priorities and results of this analysis will be presented to the Commission concurrent with the presentation of a recommendation on the bids for this project.
Action Request:
Utility Department staff requests approval from the City Commission to adopt Resolution No. 6704 authorizing the sale of $28,100,000 million in revenue bonds for water system improvements and authorize the City Manager to set a bid date of March 27, 2007 for Phase II of the Clinton Water Treatment plant expansion.