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CITY
OF
PUBLIC WORKS TELEPHONE
(907)235-3170
MEMORANDUM 07-168
To:
From:
Date:
Subject: Homer
Water Treatment Plant Improvement Project
Budget Approval –
Funding Expectations – Project Status
Background: The City (starting in 2005) secured funding
for this project. In the State’s FY 06
budget, $480,000 was obtained (70% State/30% City) for design. In the State’s FY
07 budget, $2,072,000 was obtained (50% State/50% City) for final design and
construction. In the State’s FY 08 budget, $2,500,000 was obtained (50%
State/50% City) for construction. The
City has requested an additional $2,400,000 (50% State/50
Total funding in
place (with the FY 09 requested funding) - $7,452,000 ($3,822,000 State/$3,630,000
City). The City can secure low interest
loans (2.5%) through the Alaska Drinking Water Fund (ADWF) for the remainder of
the cost of the project.
This February, our
design consultant HDR completed the preliminary design. Based on this design the total expected construction
cost was $7,490,000. In September HDR
completed the final design. The expected
construction cost of the project has risen to $9,172,848.
The construction
costs rose because:
- Continuing increases to commodity and
material costs (i.e.: steel, copper, lumber, etc.)
- Building square footage increased to
accommodate a larger treatment equipment footprint than was expected.
- The existing sludge beds needed to be
cleaned out and additional lagoon piping was required. This required an on-site
dewatering facility not previously expected.
- Additional treatment equipment was
needed to meet new lead/copper rule drinking water concerns.
The plans have been
submitted to the Alaska Department of Conservation and the State Fire Marshal.
Once their comments
are incorporated into the plans and the project will be ready to bid.
Discussion: The project consists of the construction of a
new water treatment plant that will utilize membrane filtration
technology. The construction of the
project will consist of two parts; competitive procurement of the membrane
treatment equipment (through a RFP process); and construction of the
building facility
and installation of the membrane treatment equipment through the normal
competitive bidding process. The
membrane treatment equipment has been purchased and is expected to arrive
onsite in the Spring of 2008.
Attached are
drawings showing the proposed site plan for the facility, a floor plan of the
treatment plant building, and exterior view of the facility.
Additional land is
required to construct the new treatment plant facilities. The City is in final negotiations with the
adjacent property owner to secure ownership of the required parcel of land.
The schedule for the
project is anticipated as follows:
Complete Final Design of WTP
facility November,
2007
Open Bids for Construction of WTP
facility December, 2007
Award Bids for Construction of WTP
facility January,
2008
All Grant and Loan Funds in Place February,
2008
Issue Notice to Proceed for WTP
facility February,
2008
Start Construction of WTP facility May,
2008
Procured Treatment Equipment Arrives
in Homer June,
2008
Construction of WTP facility
Complete November,
2008
The total budget for
this project is as follows:
City Admin./Support Contracts $ 250,865
Design $ 842,645
Construction $
9,172,848*
Inspection $ 650,000
Contingency (5%) $ 458,642
Total Project Budget $ 11,375,000
- this includes membrane treatment equipment already
purchased.
Funding for the
project is anticipated as follows:
City
Portion State Portion Total
ADEC FY 06 Grant $ 144,000 $
336,000 $ 480,000
ADEC FY 07 Grant $ 1,036,000 $ 1,036,000 $ 2,072,000
ADEC FY 08 Grant $ 1,300,000 $ 1,300,000 $ 2,600,000
ADEC FY 09 Grant $
1,200,000 $ 1,200,000 $ 2,400,000
ACWF Loan $
3,823,000 $ 0 $ 3,823,000
$
7,503,000 $ 3,872,000 $ 11,375,000
(Note:
The City has requested additional federal grant funding assistance through our
federal representatives that could reduce the amount of loan funding required
for this project.)
Recommendations:
1)
The City
Council establish the overall budget for the water treatment plant improvement
project at $11,375,000.
2)
City
Council be prepared to authorize the acceptance of a loan offer from the ADWF
early in February in the amount of $7,503,000.
3)
City
Council be prepared to award contract for construction of the water treatment
plant facility
4)
City
Council be prepared to award a construction inspection/administration contract
to