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HomeMy WebLinkAboutR-2006-159 Expenditure Authority - Wastewater Treatment Plant Improvements. f. RESOLUTION NO. R-2006-159 A RESOLUTION giving the City manager authority for approving expenditures of budgeted funds for Engineering services and construction of improvements for the Wastewater Treatment plant (WWTP) and Collection System. WHEREAS, the 2004 City of Yakima Wastewater Facility Plan identifies the requirements by regulatory mandates, growth (capacity) issues, replacement of aging facilities, and improved efficiencies that are going to be needed over the next 20 years; and WHEREAS, Black & Veatch Corporation completed the Facility plan, Phase One Pre - design, Phase One Final Design, Phase One Bid Phase Services, NPDES Permit Services and Metals Studies, continues providing Construction services for Phase One implementation, and began the Collection System Evaluation, as described in the Agreement Between the City of Yakima and Black & Veatch Corporation made and entered into on April 23, 2003; and WHEREAS, Council authorized execution of budgeted funds for Design Services and Collection System Evaluation on 7/7/04. On 12/13/05 an amendment to the professional services agreement with Black & Veatch Corporation was authorized by Council for implementation of the Phase One WWTP Improvements; and WHEREAS, with the addition of the Proposed Ultra Violet Disinfection System and additional Human Machine Interface (HMI) Software Upgrades identified for the WWTP processes, use of additional budgeted funding for professional engineering services is required to complete the first construction phase of WWTP Improvements and HMI upgrades per the Agreement with Black and Veatch Corporation; now therefore BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF YAKIMA: The City Manager is authorized to approve all contracts, grant applications, and expenditures of budgeted funds for Engineering services and construction of improvements for the Wastewater Treatment Plant (WWTP) and Collection System and also to take all necessary and prudent actions to implement the 2004 City of Yakima Wastewater Facility Plan ADOPTED BY THE CITY COUNCIL this 7th day of November, 2006. ATTEST: Dave Edler, Mayor For City Council Information April 18, 2005 To: Honorable Mayor, City Council and City Manager From: Max Linden, Wastewater Utility Engineer Subject: Wastewater Facility Improvements This memo will provide an update on Wastewater Facility Improvements and justification for additional funding. The Wastewater division wishes to request permission to submit an application for a $4,000,000 loan from PWTF for council approval at the May 3rd 2005 City Council meeting. Implementation of the adopted 2004 Wastewater Facility Plan is dependent on development of a realistic and sustainable Capital Facilities Plan which takes into account various internal sources of revenue such as rates, fees and connection charges as well potential external sources such as grants and loans. The implementation and fmancing program is based on analyses of the wastewater collection and treatment systems, projected growth rates and recommended and required improvements for sustaining growth and meeting regulatory requirements. The Wastewater Facility Plan provides a general overview of past rates analyses, financial policies of the City of Yakima's Wastewater Utility and an overview of the revenue requirements associated with completion of the projects outlined herein are provided. In addition, project implementation costs are evaluated and potential revenue alternatives that may be available to the City are discussed. A summary of recommended improvements to the Yakima Regional WWTP and the collection system have been identified in section 12 of the 2004 Wastewater Facility Plan. Improvements have been divided into near term (0-6 years), mid- term (7-12 years) and long range (13-20 years) recommendations that are further broken down into key treatment feature projects, other wastewater treatment facilities projects and collection system improvements. Project prioritization were determined based on relative need and regulatory requirements associated with each. Over the 20 -year planning horizon recommended improvements to the Wastewater Treatment Facility include a variety of projects totaling an estimated $41 million in regulatory, capacity upgrade, health and safety features and regular renewal and replacement projects with approximately $31 million in improvements scheduled " J for the 0-6 year near-term capital improvement program. The 2004 Wastewater Facility Plan identifies the improvements, estimates costs, relative schedules and the primary reason for installation or upgrade. Indication of the reason for the upgrade should be a primary determination in deciding the type of funding to be utilized for each project. General speaking, upgrades that are mandated by regulation are most suitable for loan and grant financing, while smaller projects and regular renewal and replacements are most commonly financed from available cash and rates. This does not, however, preclude the packaging of several related improvements into funding applications that allow similar projects to be accomplished simultaneously. The inclusion of a variety of projects into one application also allows the more serious of the issues being addressed to help sell less significant aspects of the overall project through the competitive processes. Analysis of the treatment systems performed as part of the facility plan indicates the need to provide redundancy to several operations within the treatment plant. Redundancy is required to meet Washington State Department of Ecology criteria for provision of backup facilities to major treatment processes to assure compliance with the City's NPDES permit and associated rules and regulations. The following areas, scheduled for the 0-6 near term planning horizon, have been identified and prioritized in the planning process as the most critical facilities requiring redundancy. These projects are included in the Series B bond proceeds funding received in 2003. • Centrifuge Dewatering in new solids handling building (Project 23) — Currently only one of the two centrifuges is function for dewatering biosolids and this requires extensive maintenance to continue operating. A new centrifuge is required to maintain compliance when the older centrifuge is out of service. The new centrifuge will be located in a new solids handling building. The older centrifuge will be used for redundancy requirements for dewatering and thickening. • Solids Thickening (Projects 21 and 22) — The waste activated sludge thickening process reduces the total volume sent to the digestion process, and directly impacts regulatory compliance. Currently only one dissolved air flotation thickener (DAFT) unit is in place to thicken secondary sludge. The older centrifuge will also be used as a second thickening unit to meet redundancy criteria. • Standby Power Capacity Addition (Project 38) - The emergency power system supplies a backup source of power to assure that minimum treatment is provided during a power failure. The existing generator set was installed in 1980 and at a minimum, requires a complete inspection/overhaul. An additional generator set is required to operate the minimum treatment process. This unit will be housed in the new blower building. • New Blowers in New Blower Building (Project 7) — Existing VFDs that operate the four 400 horsepower blowers are far less efficient and generate more harmonic distortion on the electrical power system than newer technology. The blowers and VFDs are all at the end of their useful life, are difficult to find replacement parts for and require replacement. Construction of a new structure to accommodate new blowers is recommended. In addition, to redundancy projects the following projects, also scheduled for the 0- 6 near term planning horizon, have been identified as critical projects for renewal, safety and efficiency of operations. • Replace SCADA System (Project 39) — Major SCADA system components will be replaced, including PLCs, computer hardware and software, HMI software, and historical data logging software. • IJV Disinfection (Project 40) — UV disinfection facilities will be installed to replace chlorine disinfection, reducing safety and security concerns. • New Grease Receiving, Facility, Replacement of Digester Gas Piping, Valves and Flow Meters — The digester gas collection piping is over 20 years old and needs to be upsized. The projects above, identified as part of the near term (0-6 yrs.) priority improvements in the 2004 Wastewater Facility Plan, are being packaged as one project. This package includes having our engineer upgrade the plants SCADA system (currently under way), two pre -procurement bid packages to pre -purchase blowers and a centrifuge (ready to go out for bid) and a construction bid package planned to be advertised for bid in October of 2005. The total cost of this will be approximately $13,796,000. (See highlighted projects on Table 3-4 Capital Improvement Projects) In 2003, the City of Yakima implemented a new rate structure to increase revenues to the wastewater utility. Additional funding assistance for future projects comes from the approximate $18 million in revenue bonds that were issued by the City in 2003. These bonds were divided into two distinctive series with approximately $7.46 million in proceeds from Series A bonds being used to pay for the settlement of previous litigation relating to odor control within the sewer system. Approximately $10 million in proceeds from sale of Series B Bonds is being used to fund a variety of projects and capital improvements involving the City's wastewater treatment plant. Projects dedicated to resolving issues related to regulatory requirements are often financed by government administered grant and low interest loan financing programs. In competitive financing programs such as Public Works Trust Fund, Centennial Clean Water and State Revolving Fund programs, regulation mandated projects tend to receive higher scores than renewal and replacement or growth driven projects. Growth related system improvements are generally funded through property assessments, connection charges and development fees. None of the specific improvements mentioned above. are growth related only. Long term financing strategies will include continuing to apply for grant and low interest funding, where appropriate, and maintaining current and equitable connection charges and fees so that growth can finance required system expansions. The 2004 Wastewater Facility Plan presents a historical and projected budget for the City of Yakima Wastewater Utility. This simplified budget overview is intended to provide order of magnitude costs and assist the City in its on-going decision making, project prioritization and budgeting. More detailed consideration of available finds and revenue requirements occurs bi-annually in the City's established rate review and cost-of-service analysis and periodic review and adjustment of connections charges. As discussed previously the 2003 bond issue provides a significant source of revenue ($10,000,000) for immediate improvements to the wastewater treatment plant. The overall cost of this first phase of (0-6 yr) priority projects is estimated to be $13,796,000. Another $4,000,000 is needed to fund this work through 2008. The Wastewater Division. can apply now for a $4,000,000 low interest loan from the Public Works Trust Fund, PWTF, in May 2005, and make debt payments without raising rates. The Table titled Wastewater System Debt Service shows our existing debt service and coverage along with projected future loans. The new loans would not add to our debt coverage, only to our debt service, and in 2008, 2011, 2013, and 2015 existing loans and bonds will be paid for. With the addition of the three project loans (shown on Table 3-3) our obligation to these debts will only increase by approximately $200,000/yr. for three years, which can be covered without raising rates, and then will decrease over the life of these loans. After 2008 Long term financing strategies will include continuing to apply for grant and low interest funding, where appropriate, and maintaining current and equitable connection charges and fees so that growth can finance required system expansions. BUSINESS OF THE CITY COUNCIL YAKIMA, WASHINGTON AGENDA STATEMENT Item No. /lo ''r For Meeting Of 11/07/06 ITEM TITLE: - Request approval of a resolution giving the City manager authority for approving expenditures of budgeted funds for Engineering services and construction of improvements for the Wastewater Treatment plant (VVVVfP) and Collection System. SUBMITTED BY: Dave Zabell, ACM - Doug Mayo, WW Manager - Max Linden, Utility Engineer CONTACT PERSON/TELEPHONE: Max Linden/575-6077 SUMMARY EXPLANATION: The 2004 City of Yakima Wastewater Facility Plan identifies the requirements by regulatory mandates, growth (capacity) issues, replacement of aging facilities, and improved efficiencies required over the next 20 years. The engineering consulting firm of Black & Veatch Corporation provided NPDES Permit Services, began the Collection System Evaluation, completed a Metals Study, Facility plan, the Pre -design, Final Design, Bid Phase Services, and continuing construction services for the current mandated Phase One Wastewater Improvements as described in the April 23, 2003 Agreement Between City of Yakima and Black and Veatch Corporation for Professional Services. (...continued on next page) Resolution X Ordinance _ Other (Specify) to authorize use of budgeted funds for Phase One WWTP Improvements Contract -- Mail to (name and address): Funding Source WW Facilities Project (478 Fund) Budgeted and WW Facilities Project (472 Fund) Budgeted APPROVED FOR SUBMITTAL: City Manager STAFF RECOMMENDATION: Staff respectfully requests City Council approve the resolution. BOARD/COMMISSION RECOMMENDATION: COUNCIL ACTION: Resolution adopted. _Resolution R-2006-159 (...continued from front page.) Council authorized use of budgeted funds for Design Services and Collection System Evaluation on 7R/04. Since that approval, several other items requiring the services of Black & Veatch were added to their Scope of Work. These included: design work for the Speedway Interceptor, Risk Management Plan update, Odor Control Study, Chemical Feed Pilot Project, SR 24 Permit Review, and SR 24 Monitoring Plan. Amendment 1 was authorized on 12/13/05 to include these and provide construction services for the current phase One WWTP Improvements. With the addition of the proposed Ultra Violet Disinfection System funded by a $2,300,000 Public Works Trust Fund Loan and needed Human Machine Interface (HMI) software upgrades, additional contract budget authority is required to continue construction services and HMI upgrades for the current construction phase of WWTP Improvements. It is estimated that the services for the completion of construction and HMI software upgrades will be $600,000 Currently, the agreement between the City of Yakima and Black & Veatch Corporation for professional services has authorized expenses for completing the mandated Facility Plan ($608,000), mandated NPDES permitting requirements for Collection System Infiltration and Inflow Evaluation (400,000), required regulatory compliance evaluations and plans ($250,000), Odor Evaluation and Survey ($70,000), Collection System Design ($450,000), WWTP Phase One Design ($1,800,000) and WWTP Phase One Construction Services ($1,030,000) for a total of $4,758,000. The additional $600,000 required to complete the current ongoing construction work, will increase the total authorized budget for this agreement to $5,358,000. The 478 Wastewater Facility Project Fund (project 2055) and 472 Wastewater Facility Project Fund (project 2182) identified in the 2006 adopted budget and 2007 preliminary budget includes appropriations to accommodate the expenditures required to complete the first portion of Phase One improvements and Construction Services provided by Black & Veatch Corporation. Additional engineering services provided under the agreement between the City of Yakima and Black & Veatch Corporation for professional services, along with future construction of Phase One WWTP improvements, will be funded as resources become available.