2015 04-07 city-council_workshop_presentation

Wastewater Treatment Plant

Project Update

4/7/20151 City Council Workshop

Introductions

4/7/20152

City

Mayor

City Council

Department Heads

Staff

Carollo Engineers

Design Team

Hoffman Construction

GC/CM Contractor

City Council Workshop

Agenda

4/7/20153

Introductions

Project Goals

Project History / Milestones

Facilities Plan to 30% (Concept to Reality)

Why GC/CM?

Cost / Funding / Rates Relationship

Key Decisions / Next Steps

Other Topics


Agenda

4/7/20154

Presentation will address

Project Cost

Cost Saving Measures

Schedule

RV Park

Permits

Please be patient as we lead you though the presentation

There will be opportunity to ask questions at the end of

each section and at the end of the presentation


Project Goals

4/7/20155

“Recognizing that the City of Oak Harbor is connected to

the pristine waters of Puget Sound, specifically Oak Harbor

and Crescent Harbor Bay, the City’s goal is to obtain the

highest of water quality practical while recognizing the

limitations of the rate payers of the City to fund the

improvements.”


Project Goals

4/7/20156

Provide reliable wastewater treatment services;

Meet high water quality standards;

Allow phased expansion to meet future demands; and

Deliver construction and operation of a new facility by 2017 in

a cost-effective manner


Agenda

4/7/20157

Introductions

Project Goals



Why GC/CM?



Other Topics


Existing

Lagoons

Existing

Force Main

Existing

Rotating Biological

Contactor (RBC) Plant

Oak Harbor

Outfall

Collapsed

Crescent Harbor

Outfall

(in need of repair)

Project History

4/7/20159

Existing Rotating Biological Contactor(RBC) Plant

Located next to Windjammer Park

RBC process largely disabled (Available for emergencies)

Aging facility that is difficult/expensive to maintain

Currently used to

screen coarse material

and send influent to

the Lagoons


4/7/201510

Force Main Failure in 2005 caused emergency repair

With Oak Harbor outfall failed, the impact of another

failure could be

extreme


Project History

Seaplane Base Lagoon

Draft FEMA documents potential flooding in 100 year storm

event

11

Existing

Seaplane Base

Lagoon

Project History

Previous storm events have put the lagoons at risk

12

Dike Protecting

Treatment Plant

Flooded

Access Road

Dike Protecting

Lagoons

Debris

Right up to

Fence

Project History

Milestones

4/7/201513

2008 – Sewer Comp

Plan Identifies Need


Milestones

4/7/201514

December 2010 – Started Facilities Plan

April 2011 – Narrowed to 5 potential sites (Resolution 11-07)

January 2012 – Added 6th site - Crescent Harbor North (Resolution 12-05)


Milestones

4/7/201515

April 2012 – Narrowed Selection to Windjammer Vicinity

& Crescent Harbor North (Resolution 12-10)

August 2012 – Selected Windjammer Vicinity

(Resolution 12-17)

Oak

Harbor

Outfall

Milestones

4/7/201516

Why Windjammer Vicinity instead of Crescent Harbor

North????

Capital Cost of two options was similar

Crescent Harbor North would have included

Pump Station near existing RBC Plant

+/- 2 miles of piping to and from Crescent Harbor North

Ongoing annual O&M cost and risk associated with pumping

wastewater to Crescent Harbor North and effluent back to Oak

Harbor ($170,000/yr)

Risk of impacting cultural resources at sites & along alignment


Agenda

4/7/201517

Introduction and Project Goals



Why GC/CM?



Other Topics


Facilities Plan to 30%From Concept to Reality

4/7/201518

We will cover the following items in this section

Milestones from the Facilities Plan to 30% (Concept to Reality)

30% Design Review

30% Cost Estimate(s)


Facilities Plan to 30%Milestones

4/7/201519

November 2013 – Facilities Plan Adopted (Resolution 13-31)

November 2013 – Completed 15% Value Engineering

December 2013 – Authorized to pursue GC/CM (Resolution 13-32)

January 2014 – Navy non-committal (Resolution 14-05)



4/7/201520

March 2014 – Purchased Whidbey Island Bank property

Why the Whidbey Island Bank Property?

No net loss of park space

Willing seller vs. Condemnation

Minimized impact on potential cultural resources

Minimized displacement of businesses to avoid relocation

requirements



4/7/201521

March 2014 – State Capital Project Advisory Review

Board (CPARB) – Project Review Committee (PRC)

approval to use General Contractor / Construction

Manager (GC/CM)

March 2014 – Started selection process for GC/CM



4/7/201522

April 2014 – City

Council Workshop



4/7/201523

July 2014 – Selected Hoffman as GC/CM



24

August 2014 – Authorized site layout on former

Whidbey Island Bank Property (Resolution 14-28)

Treatment Plant

Project

Limits


4/7/201525

January 2015 – Defined Work Area (Resolution 14-43)


26

Facilities Plan to 30% 30% Design - Overall Site Plan

Facilities Plan to 30% 30% Design - Overall 3D Site Plan

4/7/2015City Council Workshop27

Facilities Plan to 30%

30% Design - Conceptual Rendering

4/7/201528

Solids

Handling

Headworks

Primary

TreatmentElectrical /

Controls

Secondary

(MBR)

Admin /

Maintenance

Training Facility

Existing Whidbey

Island Bank

Building


29

Facilities Plan to 30% 30% Design – Conceptual Landscaping

Facilities Plan to 30% 30% Design - Headworks 3D Model

Facilities Plan to 30% 30% Design - Headworks 3D Section

Facilities Plan to 30% 30% Design – Secondary Building 3D Model

Facilities Plan to 30% 30% Design - Secondary Building 3D Model

Facilities Plan to 30% 30% Design - Solids Building 3D Model

Facilities Plan to 30%30% Cost Estimate - “Project Limits”

4/7/201536

Treatment Plant


Facilities Plan to 30% 30% Cost Estimate

Components consistent with Facilities Plan

4/7/201537

Cost Component Description

Soft CostEngineering, Legal,Administration, GC/CM

services prior to construction, Overhead, etc.

Land AcquisitionPurchase price of land/structures for purpose

of building new facilities

Treatment Plant (WWTP)

Construction

Total Construction Cost of new treatment

plant and associated improvements


4/7/201538

$78.9

*

$116.5

WWTP Construction is

> 75% of Total Project Cost

*Cost at construction mid-point


Facilities Plan to 30%30% Cost Estimate – Carollo’s Estimated

Total Project Cost at Facilities Plan Level

Facilities Plan to 30%30% Cost Estimate

Refinements since Facility Plan Approval

4/7/201539

Project ComponentPlan Assumption

(Scenario 2, Phase 1)

30% Design

Assumption

Electrical,

Instrumentation and

Control

Assumed as a % of

construction on low end of

typical range

Assumed as a % of

construction on high end of

typical range

Site Layout Between 3 to 4 acres

Approx. 2.5 acres to

minimize impact on

Windjammer Park

Solids ProcessHaul Class B biosolids

to Eastern WA

Reuse Class A biosolids

on Whidbey Island

City Beach St.

Improvementsn/a (no site selected)

Re-grade along eastern

WWTP frontage

Future Bayshore

Extensionn/a (no site selected)

Full section extended along

southern frontage

Training Facility n/a (not included) 200-seat capacity


Facilities Plan to 30% 30% Cost Estimate –

The current project scope is very

similar to “Scenario 2, Phase 1” per

Facilities Plan, and reflects VE and

Community input.

4/7/201540

Project ComponentPlan Assumption

(Scenario 2, Phase 1)

30% Design

Assumption

WWTP Capacity 2.6 mgd (Yr. 2021) 2.6 mgd (Yr. 2021)

Treatment Process MBR/UV MBR/UV

Effluent OutfallNew Outfall into

Oak Harbor

New Outfall into

Oak Harbor


Facilities Plan to 30% 30% Cost Estimate –

Carollo’s Estimated Total Project Cost

4/7/201541

$78.9

$116.5*

$38.1

*Cost at construction mid-point


Facilities Plan to 30%30% Cost Estimate – Where have the estimated $38.1M occurred?

39%

30%

21%

10%

Estimating Methods

Scope Modifications

Added Technical Detail

"Other"

Four Categories of Construction Cost Increase

4/7/201542

Focus Area: Electrical,

Instrumentation and Control

Focus Area: Ground Improvements

(Geotechnical)

Focus Area: Solids Handling


Facilities Plan to 30%30% Cost Estimate - How do the

Carollo and Hoffman cost estimates

compare at this stage of design?

4/7/201543

Currently reconciled to within 15% of one another

Within estimating accuracy at this level of detail

Have confirmed scope, quantities and approach to work

for major cost components

Continue to review/refine cost differences as detail is

added through 60% design

Concrete (~30% difference due to unit pricing)

Process/Mechanical (~15% difference due to scope

assumptions)


4/7/201544

Costs shown are for

construction only and

do not reflect overhead,

soft costs or outfall

construction.


Facilities Plan to 30% 30% Cost Estimate – Construction Costs

Range from $98 M to $113 M

Agenda

4/7/201545




Why GC/CM?



Other Topics


Why GC/CM?

4/7/201546

November 19, 2013 – Project Delivery Presentation

Project Delivery Options

Design – Bid – Build

Design – Build

General Contractor / Construction Manager


Why GC/CM?


Advantages

Greatest project value

High level design control

Cost certainty earlier in project

Incorporate contractor feedback in design

Disadvantages

Requires PRC approval

Unfamiliar delivery method

Not lowest cost initially

Why GC/CM?

4/7/201548

Construction can overlap Design on elements that are

well defined.2015 2016 2017

Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

2014 2018

30%

60%

90%

Site Prep

WWTP Construction

WWTP Design

WWTP Construction

Site Restoration

April 7, 2015

December 31, 2017


Why GC/CM?GMP Development Process30% Budget

Estimate

Development*

Value

Engineering &

Program

Refinement

Design

Progression

to 60% Detail

60% Estimate

Development/

Reconciliation

Design Scope

Containment and

Cost Testing***

90% Design

Estimate

Development

Bidding of

Major

Subcontract

Packages

Establish MACC

& Obtain

Council

Approval**

Commit Major

Subcontracts,

Complete

Subcontract

Bidding,

Construction

Maximum Construction

Cost Guaranteed Here

Confirm

Estimate

Assumptions &

Basis *

Where we are today

Independent 3rd Party Cost

Verification Here

Why GC/CM? - Process Provides Better

Cost Control and Earlier Cost Certainty


Agenda

4/7/201551




Why GC/CM?



Other Topics


Cost / Funding / Rate Relationship

4/7/201552

Customer rates are a blending of:

RATES

Schedule

Funding

Cost


Cost / Funding / Rates RelationshipWhat are we doing about the increased

cost?

4/7/201553

RATES

Schedule

Funding

Cost


Cost / Funding / Rates RelationshipWhere have the estimated $38.1M occurred?

39%

30%

21%

10%

Estimating Methods

Scope Modifications

Added Technical Detail

"Other"

Four Categories of Construction Cost Increase

4/7/201554

Focus Area: Electrical,

Instrumentation and Control

Focus Area: Ground Improvements

(Geotechnical)

Focus Area: Solids Handling


Cost / Funding / Rates RelationshipEstimating Methods ~ 39% of Increase(Transition from planning estimate to definitive

estimate)

4/7/201555

Line ItemApproximate

Increase

Cost Saving

ApproachRange of Potential Savings

Electrical,

Instrumentation &

Control (EI&C)

$14 M

Internal VE to

reduce EI&C

allowance %

$1.0 M $3.0 M

Contingency --Reduce

Contingency %$1.0 M $3.0 M

Escalation to Mid-point

of Construction$600 K

Maintain Planning-

level Mid-point

(5/16)

-- $600 K

Total Potential Cost Savings $2.0 M $6.6 M


Cost / Funding / Rates Relationship Scope Modifications ~ 30% of Increase(Elements added between planning and 30% design)

4/7/201556


Increase

Cost Saving


Class A Solids Handing

Technology$9.0 M

Phase-in Class A

Technology$7.0 M $10.0 M

200-Seat Training

Facility$1.6 M

Outside Funding

for Training Facility-- $1.6 M

Lab/Admin/Maint.

Facility Programming$600 K

Reduce Size of

Non-process

Facilities

-- $600 K

Extend Bayshore 350

LF Along Southern

Frontage

$225 K

Outside Funding

for Bayshore

Extension

-- $225 K



Cost / Funding / Rates RelationshipSite-specific Technical Detail ~ 20% of Increase (Elements revised due to additional design information)

4/7/201557


Increase

Cost Saving


Sitework $6.0 M

Optimize Ground

Improvements,

Shoring,

Earthwork

$1.6 M $3.1 M

Archaeology $550 K n/a -- --

700 LF City Beach

Street Re-grade$340 K n/a -- --

Premium Architecture

Treatments$950 K n/a -- --



Cost / Funding / Rates Relationship Specific Actions Already Completed to

Reduce Cost

4/7/201558

Formal Value Engineering (VE) to:

Screen, grit modifications in headworks ($1 M)

Aeration basin design criteria and volume reduction ($1.1 M)

Develop early site contract ($225 k)

Architectural design selected to minimize construction

materials, cost and schedule while achieving look based

on community input


Cost / Funding / Rates Relationship Specific Ongoing Actions to

Reduce Cost

4/7/201559

Internal Value Engineering (VE) to:

Reduce EI&C cost and estimating conservatism

Reduce cost and conservatism for ground improvements

Optimize non-process facility footprint for cost

Optimize process facilities for cost

Phasing discussions for solids handling

Reduce the number of unknowns (ie - early procurement)

Other funding sources for select project elements

200-seat training facility

Bayshore extension


Cost / Funding / Rates Relationship Improved Level of Detail Helps to Further

Reconcile and Confirm Costs

Typical 30% Design Typical 90% Design

4/7/201560

±150 Drawing Sheets

Very Limited

Specifications

> 600 Drawing Sheets

> 2,000 Pages of

Specifications

ADD TYPICAL 30% MECH PLAN ADD TYPICAL 90% MECH PLAN



4/7/201561

What sources of funding are being pursued?

RATES

Schedule

Funding

Cost



4/7/201562

RATES

Schedule

Funding

Cost

The optimal funding package includes those

sources which balance:

1. The lowest effective interest rate.

2. The maximization of long-term savings

3. The ability to pay.


4/7/201563

Imagine financing a new car for $10,000

Loan criteria:

1) Lowest interest rate.

2) Finance over a period of years that:

i. Keeps payment amount affordable

ii. Reduces lifetime interest expense




4/7/201564

RATES

Schedule

Funding

Cost

Sources of funding being pursued:

1) Grants/FP Loans No interest rate

2) SRF Funds 1.7% to 2.7%

3) Revenue Bonds 4.5%

•The ultimate goal is to develop a package which

incorporates the lowest weighted average interest rate.

lower interest rate = lower payment rate = lower utility rate



4/7/201565

Sources of obtained so far:

Type Amount % Rate Years Annual Payments Lifetime Cost

2015 SRF Loan Package $11.4 million 2.70% 20 $745,163.90 $14,903,278.08

2016 SRF Loan Package $15.0 million 1.70% 20 $891,007.83 $17,820,156.57

Centennial Grant Award $4.6 million 0% 0 $0.00 $0.00

FP Loan $0.4 million 0% 0 $0.00 $0.00

$31.4 million 1.79% 20 $1,636,171.73 $32,723,434.65

Revenue Bonds $31.4 million 4.50% 30 $1,927,694.45 $57,830,833.42

Savings from effort: ($291,522.71) ($25,107,398.77)

Annual payment is smaller even when shortening length of financing to 20 years!!

Will continue to pursue additional packages/grants


4/7/201566

RATES

Schedule

Funding

Cost

Revenue Bond Funding

• Portions of project not financed via previous

sources will be financed with Revenue Bonds.

•Timing of bond issue(s) is dependent upon

construction schedule, bond market, and timing

of the receipt of other funding sources.

•Total package to be structured to “level” rate

requirement.



4/7/201567

RATES

Schedule

Funding

Cost

2015 SRF Loan Package $11.4 million

2016 SRF Loan Package 15.0 million

2017 SRF Loan Package 15.0 million

Centennial Grant Award 4.6 million

FP Loan 0.4 million

Cash Reserves 15.0 million

Revenue Bonds 36.7 million

Total $98.1 million




4/7/201569

RATES

Schedule

Funding

Cost

Other sources: Non-sewer component funding:

Some components of the project are not sewer

related and will not be funded by rates

Sub-project

Bayshore Drive

Splash Park

200-seat Public Facility

MVFT-Arterial, Grants, REET

General Fund, Grants

General Fund (cost benefit analysis)

Potential Sources of Funding

Sub-projects are subject to these funding sources



4/7/201570

Scheduling Impacts

Rates

Schedule

Funding

Cost



Site Preparation Start –vs- Overall Completion


2015 2016 2017Activity M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D

Permitting

30% Design

Site Prep

60% Design

90% Design

100% Design

30% Design

Approval / Procure

Site Prep

Plant Construction

60% Design

Approval / Procure

Site Prep

Plant Construction

90% Design

Approval / Procure

Site Prep

Plant Construction

Base Assumption Overall Schedule with Site Prep Release with 5/5/15 City Council ApprovalOption 2 Overall Schedule with Site Prep Release Utilizing 60% Design Documents and Reconciled EstimateOption 3 Overall Schedule with Site Prep Release Utilizing 90% GMP Documents

2014

City of Oak Harbor - Construction Schedule Study7-Apr-15

2018

April 7, 2015

December 31, 2017

Base Assumption

Option 2

Option 3

Cost / Funding / Rates Relationship How do we move forward and

simultaneously control cost?

4/7/201572

Early work is planned to speed schedule (avoid

escalation) & Mitigate risk (associated cost)

Ongoing Budget management during design

Specific VE between CE, HCI, COH

Scope modifications by COH

Alternate sources of funding for certain projects components

(bayside, training facility, etc.)

Early work construction will not commence before the

reconciled budget is shown to match City’s budget



4/7/201573

RATES

Schedule

Funding

Cost


Cost / Funding / Rates RelationshipRate Impacts

4/7/201574

The goal of the WWTP funding plan has been to

accumulate$15 million in cash to effectively provide:

Initial Cash Reserves to strengthen utility for credit purposes

A form of down payment to lessen interest expense

Cash reserves to bridge the receipt of loan proceeds.

Ordinance No. 1587 passed October 5, 2010:

Increased wastewater rates systematically over time (Moodys).

Provides accumulation of cash reserves

Avoids dramatic rate changes in any one year.

Rates from $40.00 to 64.75 over 5-year period.

Cost / Funding / Rates Relationship Rate Impacts

4/7/201575

The level of significance of the drivers of rate impact

are as follows:

1) Cost – Cost is by far has the greatest impact on rates.

2) Schedule – can be the least, or the most, significant

based on potential delays and the resulting escalation.

3) Funding Source – While important, funding source has

the lesser level of significance to overall rate impact.

Agenda

4/7/201576




Why GC/CM?



Other Topics


Key Council Decisions

4/7/201577

TOPIC DATE

1. Training Facility & How To Fund APR 21

2. Authorize Outfall Award APR 21

3. What To Do w/Bank Building? MAY/JUN

4. Decision on Aesthetics MAY/JUN

5. Utility Relocation and Initial Site Preparation JUN

6. Bond Sales JUN

7. Phase-in Solids Dryer? AUG

8. Bayshore Extension & How To Fund? AUG

9. Authorize Deep Excavation Award AUG


Agenda

4/7/201578




Why GC/CM?



Other Topics


RV Park


RV ParkConstruction Impacts to

Staysail RV Park

4/7/201580

Need location to store equipment/materials

Need access to site from Beeksma Drive

Will impact 13 full hook-up and 23 overflow sites

Need location to stockpile approx. 54,000 cy of soil

Near construction site:

Reduces trucking costs

Minimizes traffic impacts

Reduces damage to roadways

City Council Resolution 14-43 authorized closing of

Staysail RV Park and utilizing site for stockpile/laydown


RV ParkConcerns About Closure

of Staysail RV Park

4/7/201581

Loss of revenue to General Fund

Sewer Fund could pay General Fund for loss of revenue as

mitigation

Loss of customers to local businesses

Options that have been suggested to reduce impact

Lease private property on west side of Beeksma Drive for soil

stockpile – keep existing Staysail RV Park open

Lease private property on Bayshore Drive for use as a

temporary RV Park

Create partial hook-up RV sites at Marina


RV ParkOPTION 1 –Lease Private Property West of Beeksma

Drive for Material Storage

4/7/201582

Considerations:

Haul road still required

Loss of 25+ hook-up and 23 (tent) overflow sites

Revenue from RV site rentals to General Fund

Cost of lease of private property

Increase traffic impacts on Beeksma Drive

Archeology concerns

Delay in DAHP permit for WWTP?

Permits

SEPA

Grading

RV Park patrons near active haul road and construction site


RV ParkOPTION 2 – Lease Private Property on

Bayshore Drive for RV Park

4/7/201584

Considerations:

Revenue from RV site rentals to General Fund

Cost of lease

Zoning

Archeology

Permits

SEPA

Grading

No hook-ups

No park amenities

No restrooms

No showers

New location for staff to monitor


RV ParkOPTION 3 –Create RV Sites at

Oak Harbor Marina

4/7/201585

Considerations Revenue from RV site rentals to Marina Fund

Possible to create approx. 30 partial hook-up sites

Possible to install power and water

Cost

Archeology concerns

Shoreline permit

Not feasible to install sewer hook-ups

Staysail dump station will be open

Marina has portable pump out

Near Park

Other available amenities

Restrooms/Showers

Laundry

Bicycles

Food vendor(s)

Marina staff on-site


RV Park

4/7/201586

Potential site • Approximately

45 by 380 foot

area

• Water & power

available to

extend to site

Potential Site


RV Park - Amenities

Amenities Include:

• Park

• Picnic area

• Playground

• WiFi available

• Bicycles available

• Ample parking

• Showers

• Laundry

• Staff on-site


RV PARKNext Steps

4/7/201588

Current RV Park open through May 26, 2015

Can extend based on construction schedule

April 22, 2015 City Council workshop

May 5, 2015 City Council meeting


Permits


Permits

4/7/201590

City is both project owner and approving authority

Typical City permits required in addition to Federal and State

City permits include:

SEPA

Shoreline Substantial Development permit

Site plan

Including design review/design guideline conformance

Civil plans (aka utility plans)

Grading

Building

Including mechanical and plumbing

Landscape


Permits

4/7/201591

City code requires certain permit approvals before

others

Example: site plan must be approved before grading plan

This process works for typical project sequencing

Does not work for GC/CM delivery method

Phased nature of design

Phased nature of construction

Staff proposes to amend code to recognize GC/CM

Allows different sequencing of permits

Appropriate permits still required & standards still met

Schedule: PC in April/May; CC in May/June


Section 106

Memorandum of Agreement


Memorandum of Agreement

4/7/201593

Section 106 – NHPA

Requires that we talk with interested parties regarding

cultural resources

Nearing completion of MOA which includes an

Archaeological Work Plan


Key Council Decisions

4/7/201594

TOPIC DATE

1. Training Facility & How To Fund APR 21

2. Authorize Outfall Award APR 21

3. What To Do w/Bank Building? MAY/JUN

4. Decision on Aesthetics MAY/JUN

5. Utility Relocation and Initial Site Preparation JUN

6. Bond Sales JUN

7. Phase-in Solids Dryer? AUG

8. Bayshore Extension & How To Fund? AUG

9. Authorize Deep Excavation Award AUG


Questions?
