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HomeMy WebLinkAboutMinutes - August 30, 2011 SSLODI CITY COUNCIL SHIRTSLEEVE SESSION CARNEGIE FORUM, 305 WEST PINE STREET TUESDAY, AUGUST 30, 2011 A. Roll Call by City Clerk An Informal Informational Meeting ("Shirtsleeve" Session) of the Lodi City Council was held Tuesday, August 30, 2011, commencing at 7:00 a.m. Present: Council Member Hansen, Mayor Pro Tempore Mounce, and Mayor Johnson Absent: Council Member Katzakian, and Council Member Nakanishi Also Present: City Manager Bartlam, City Attorney Schwabauer, and City Clerk Johl B. Topic(s) B-1 Water Treatment Plant Staffing Plan Update (PW) City Manager Rad Bartlam provided a brief introduction to the subject matter of the Water Treatment Plant Staffing Plan. Public Works Director Wally Sandelin provided a PowerPoint presentation regarding the Water Treatment Plant Staffing Plan. Specific topics of discussion included operation phases, commissioning, post commissioning, normalization, optimization, comparison of staffing, comparison of staff compensation, comparison of labor costs, common costs, other costs, and general considerations. In response to Mayor Pro Tempore Mounce, Mr. Sandelin stated the estimated maintenance and operations costs are incorporated into the numbers presented for the private vendors and the City. Mr. Sandelin stated the maintenance for the existing wells has been capped at $50,000. Mayor Pro Tempore Mounce requested the annual maintenance costs for the existing 26 wells over the last five years. In response to Mayor Johnson, Mr. Sandelin stated the City is required to monitor and report results of various tests showing that the City is providing good quality water to the citizens and permission to operate is granted by the various agencies accordingly. In response to Council Member Hansen, Mr. Sandelin stated the normalization process will be similar to the sewage plant, which operates 16 hours a day. Mr. Sandelin stated the design of the plant allows full automation with alarms and remote access by the supervisor at home or at the plant. In response to Mayor Pro Tempore Mounce, Mr. Sandelin stated the details of the interface between the City and the vendor should the Council decide to go that route will be forthcoming with respect to responsibility for fines, accidental discharges, and other similar matters. In response to Council Member Hansen, Mr. Sandelin stated the $50,000 estimate is close to the existing well maintenance number and the two other PAUL membrane plants in California staff visited are in Azousa and Carmichael. In response to Mayor Pro Tempore Mounce, Mr. Sandelin stated the Southwest proposal included a statement regarding trucks capital maintenance but details were not provided. Continued August 30, 2011 In response to Council Member Hansen, Mr. Sandelin stated the Southwest proposal did indicate they would provide the positions listed but for a couple of the positions details were not provided as to whether or not they would be contracted employees or work for the company. In response to Mayor Pro Tempore Mounce, Mr. Sandelin stated the positions that are marked N/A could be positions that are subcontracted or shared positions. In response to Council Member Hansen, Mr. Sandelin stated the lead operator will supervise the instrumentation technician although the ultimate person responsible is the plant manager. Mr. Sandelin stated the salaries are driven by contracts and the numbers shown are fully loaded with concessions. Discussion ensued between Mayor Pro Tempore Mounce and Mr. Sandelin regarding the difference in positions between the Southwest proposal and the City over years one, two, and three. In response to Mayor Pro Tempore Mounce and Council Member Hansen, Mr. Sandelin reviewed the current and proposed SCADA operations and need for start-up technical support. In response to Mayor Johnson, Mr. Sandelin stated Public Works currently pays Electric Utility approximately $300,000 annually for various calls and with the Lodi Center Credit that number will be reduced to $150,000. In response to Mayor Pro Tempore Mounce, Mr. Sandelin confirmed that there will be no profit for the City in providing the service to citizens and maintaining and operating the plant. In response to Council Member Hansen, Mr. Sandelin stated he is not sure what the profit margin is for Southwest because the proposal is based on estimated numbers and details are not provided. A brief discussion ensued amongst the City Council and Mr. Sandelin regarding staffing requirements and experience of employees, regulations and requirements set forth in contracts that must be met, and the potential of change orders. In response to Mayor Johnson, Mr. Sandelin stated the PAUL membranes are well respected nationally as new technology. In response to Council Member Hansen, Mr. Sandelin stated the PAUL membrane technology was created within the last ten years. Southwest representative Bill Reavis provided a brief overview of the company, stating the company started in the 1940s, there are over 2,000 employees working in eight states, of which six are membrane plants and one is a PAUL membrane plant. Mr. Reavis also discussed the lack of change orders as an operating company, the Mountain House plant operations, relationships with various regulatory agencies, previous experience with well contamination and monitoring, and public outreach efforts. Bill Lyko, representing the Coalition of Concerned Citizens of Stockton (CCCOS), spoke in regard to his concerns about privatizing citizen services, the utilization of contractors and subcontractors, true -up fees, profit margins for private companies, and the City of Stockton's experience with running its plant. Veolia representative James Good spoke in regard to the benefits of privatization, including risk transfer, cost controls, and experienced employees for start-up plants. He also N Continued August 30, 2011 discussed transition and training, status as a publicly -traded company, payment of fines, and relationships with various regulatory agencies. Ed Miller spoke in regard to establishing some criteria by which to evaluate private companies and the need to closely monitor the contract when a service is outsourced. Ann Cerney spoke in support of the efforts of CCCOS and their concerns with privatization. In response to Ms. Cerney, Mr. Sandelin confirmed the well water would be blended with the new plant. C. Comments by Public on Non -Agenda Items None. D. Adjournment No action was taken by the City Council. The meeting was adjourned at 8:25 a.m. ATTEST: Randi Johl City Clerk AGENDA ITEM 13*11 CITY OF LODI COUNCIL COMMUNICATION TM AGENDA TITLE: Water Treatment Facilities Staffing Plan Update MEETING DATE: August 30, 2011 (Shirtsleeve Session) PREPARED BY: Public Works Director RECOMMENDED ACTION: Receive water treatment facilities staffing plan update. BACKGROUND INFORMATION: At the March 15, 2011 Shirtsleeve Session, staff presented -a proposed staffing plan for operation of the Surface Water Treatment Facilities currently under construction. The proposed plan was based upon the Technical Memorandum — Water Treatment Facility Staffing Assessment prepared by HDR, Inc., as part of the water treatment facilities project. At that meeting, City Council directed staff to investigate the option of entering into a public/private partnership as a means of operating the facilities. On May 19, 2011, staff issued requests for proposals to six firms listed by the National Association of Water Companies that are active in this field of contracting. The scope of work for the proposal was described as operation and maintenance of the water treatment plant facilities and the City's 26 groundwater supply wells. In other words, the contractor would be responsible for all the City's water production facilities. Under this program, the City would be responsible for operation and maintenance of the distribution facilities. The six firms are listed below. American Water Company CH2M-Hill Severn Trent Services SouthWest Water Company Veolia Water North America United Water A mandatory field review of the City's existing and under -construction facilities was conducted on June 15, 2011. Four firms participated in that half-day program, and two submitted proposals on August 15, 2011: SouthWest Water Company (SouthWest) and Veolia Water North America (Veolia). The primary objective of this Shirtsleeve Session is to provide a comparison of the three alternative staffing plans (Veolia, SouthWest and City), along with a summary of the similarities, differences and other highlights. Exhibits A through D provide additional information, some of which will be discussed in further detail in this meeting. A summary of the proposal requirements is included in Exhibit A. Unfortunately, the two proposals received have several differences and are non-responsive in some areas, as identified in Exhibit B. APPROVED: Kdfiradt Bartlam, City Manager K:\WP\PROJECTS\WATER\SurfaceWaterPlant\CStaffingPlan_Shirtsleeve.doc 08/24/2011 Water Treatment Facilities Staffing Plan Update August 30, 2011 (Shirtsleeve Session) Page 2 A comparison of costs for three consecutive years is provided in Exhibit C. Labor costs listed are inclusive of all salary, overtime and benefits. Exhibit D presents a comparison of the staffing levels and the proposed schedule to move the project through the Commissioning, Post Commissioning, Normalization and Optimization Phases. The exhibit indicates the total time to reach the Optimization phase is eight months (Veolia), 15 months (SouthWest) and 17 months (City of Lodi). The City Council will be asked to choose the best staffing plan at the regular meeting on September 7, 2011. A J, F. Wally ndelin Public Works Director FWS/pmf Attachments cc: Charles Swimley, Deputy Director of Public Works SouthWest Water Company Veolia Water K:\WP\PROJECTS\WATER\SurfaceWaterPlant\CStaffingPlan_Shirtsleeve.doc 8/24/2011 Exhibit A Proposal Requirements 1. Operations 24 Hours/Day and 7 Days/Week 2. Water Treatment Plant and All Wells 3. All Aspects of Facility Operation and Management 4. Vehicles and Trucks 5. Maintenance up to $50,000/Year 6. Chemicals up to $250,000/Year 7. Monitoring, Sampling, Testing, Analyses, and Reporting 8. Staffing and Organization Plan 9. Recommended Capital Maintenance Plan 10. Statements of Qualifications and Experience 11. Proposal Guarantee of $50,000 12. Eight -Year Schedule of Firm Cost (2 years/3 years/3 years) 13. Cost Proposal for RFP Plan and Alternative Plan (if desired) Written Scope of Services Vehicle and Truck Inventory Staffing and Organization Plan Capital Improvement Program Identification of Subcontractors Cost Proposal for RFP Plan Cost Proposal for Alternative Plan Exhibit B Comparison of Proposals' Content Veolia SouthWest Yes No Yes No Yes Yes Yes No No Subcontractors Not Indicated No Yes Yes Yes Exhibit C Comparison of Proposal Costs K:\W P\PROJECTS\WATER\SurfaceWaterPlant\PPP Cost Comparison.xls Veolia SouthWest City of Lodi Labor $703,491 $540,568 $800,396 Chemicals 250,000 250,000 250,000 m Maintenance 50,000 50,000 50,000 Utilities 903,000 903,000 903,000 p Other 40,000 40,000 105,000 CD m O/H & Profit 588,201 292,201 496,477 Total Price $2,534,692 $2,075,769 $2,604,873 Percentage Difference -2.7% -20.3% Labor $712,285 $362,121 $750,629 Chemicals 275,000 275,000 275,000 CD Maintenance 55,000 55,000 55,000 Utilities 914,288 914,288 914,288 Other 40,500 40,500 106,313 o O/H & Profit 555,995 433,713 443,543 Total Price 2,553,068 2,080,622 2,544,772 Percentage Difference 0.3% -18.2% Labor $721,188 $343,903 $763,942 Materials 302,500 302,500 302,500 CD Maintenance 60,500 60,500 60,500 Utilities 925,716 925,716 925,716 Other 41,006 41,006 -46,132 O/H & Profit 534,070 480,759 449,088 CD Total Price $2,584,981 $2,154,385 $2,455,613 Percentage Difference 5.3% -12.3% K:\W P\PROJECTS\WATER\SurfaceWaterPlant\PPP Cost Comparison.xls Exhibit D Month Veolia SouthWest City of Lodi 1 2 3 4 5 6 7 7 8 9 10 11 12 13 5 14 7.5 15 16 17 18 19 20 21 22 23 24 Legend # Employees Commissioning Post Commissioning Normalization Optimization K:\WP\PROJECTS\WATER\SurfaceWaterP lant\CStaffingPlan_Shirtsleeve_AttachmentD.doc Engineering fi� Water Treatment Plant Staffing Plan Shirtsleeve Session August 30, 2011 Operation Phases Commissioning ➢ Startup by Contractor and Design Engineer ➢ 24/7 Operations Post Commissioning ➢ Fully Certified Staff on Site ➢ 24/7 Operations ➢ Producing Quality Drinking Water Normalization ➢ Unattended Operations/Reduced Staffing ➢ Operating Procedures Documented Optimization ➢ Unattended Operations/Reduced Staffing ➢ Improve Treatment Efficiency, Chemical and Power Usage Comparison of Staffing Month 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 Veolia SouthWest City of Lodi Plant Manager $136,815 $120,744 $129,117 Lead Operator $106,692 $109,055 $90,399 Shift Operator $90,424 $767914 $88,317 Instrumentation Technician $123,948 n/a $137,393 Plant & Equip. Mechanic n/a n/a $93,336 Maintenance Worker $88,414 n/a $83,909 Administrative Assistant $45,302 n/a $38,000 Year 1 Difference ($) City of Lodi $800,396 Veolia $703,491 $96,905 SouthWest $540,568 $259,828 Difference (%) -12.1 % -32.5% Year 2 Difference ($) City of Lodi $750,629 Veolia $712,285 $38,344 SouthWest $362,121 $388,508 Year 3 Difference ($) City of Lodi $763,942 Veolia $721,188 $42,754 SouthWest $343,903 $420,039 Difference (%) -5.1 % -51.8% Difference (%) -5.6% -55.0% Description Cost Chemicals $2507000 Maintenance $50,000 Utilities $903,000 City of Lodi Startup Technical Support Materials & Supplies Vehicles Laboratory Services Landscape Maintenance Veolia SD & WW SCADA Operations SouthWest SD & WW SCADA Operations Total = $105,000 Total = $40,000 Total = $40,000 Cost Comparison — Year 1 Percentage Difference -8.6% -26.3% Veolia SouthWest City of Lodi Labor $703,491 $540,568 $800,396 Chemicals 250,000 250,000 250,000 Maintenance 50,000 50,000 50,000 Utilities 903,000 903,000 903,000 Other 40,000 40,000 260,000 O/H & Profit 588,201 2921201 496,477 Total Price $2,534,692 $2,075,769 $2,759,873 Lodi Center Credit -$155,000 -$155,000 -$155,000 Adjusted Total Price $2,379,692 $1,920,769 $2,604,873 Percentage Difference -8.6% -26.3% Cost Comparison — Year 2 Percentage Difference -5.8% -24.4% Veolia SouthWest City of Lodi Labor $712,285 $362,121 $750,629 Chemicals 275,000 275,000 275,000 Maintenance 55,000 55,000 55,000 Utilities 914,288 914,288 914,288 Other 40,500 40,500 263,250 O/H & Profit 555,995 433,713 443,543 Total Price 21553,068 21080,622 2,701,710 Lodi Center Credit -156,938 -156,938 -156,938 Adjusted Total Price 2,3961130 1,923,684 21544,772 Percentage Difference -5.8% -24.4% Cost Comparison — Year 3 City of Lodi $763,942 302,500 60,500 925,716 112,767 449,088 $2,614,512 -$158,899 $2,455,613 Veolia SouthWest Labor $721,188 $343,903 Chemicals 302,500 302,500 Maintenance 60,500 60,500 Utilities 925,716 925,716 Other 41,006 41,006 O/H & Profit 534,070 321,860 Total Price $2,584,981 $11995,486 Lodi Center Credit -$158,899 -$158,899 Adjusted Total Price $2,426,082 $1,836,586 Percentage Difference -1.1% -23.7% City of Lodi $763,942 302,500 60,500 925,716 112,767 449,088 $2,614,512 -$158,899 $2,455,613 Considerations • Are City facilities better run by City employees? • Collective experience of a specialized private enterprise may be superior to bringing on new staff to operate a new facility. • Dividing operations responsibilities might cause confusion. • Contractors strive for cost savings and it may affect the City's relationship with regulators. • Contractors may benefit from economy of scale when purchasing chemicals and equipment in support of numerous plant operations. Labor Chemicals Maintenance -� Utilities m m Other O 0/H & Profit Total Price Lodi Center Credit Adjusted Total Price Percentage Difference Labor Chemicals Maintenance - Utilities Other O/H & Profit o Total Price Lodi Center Credit Adjusted Total Price Percentage Difference Labor Chemicals Maintenance M Utilities Other O/H & Profit `D Total Price Lodi Center Credit Adjusted Total Price Percentage Difference EXHIBIT C Comparison of Proposal Costs Veolia SouthWest City of Lodi $703,491 $540,568 $800,396 250,000 250,000 250,000 50,000 50,000 50,000 903,000 903,000 903,000 40,000 40,000 260,000 588,201 292,201 496,477 $2,534,692 $2,075,769 $2,759,873 -$155,000 -$155,000 -$155,000 $2,379,692 $1,920,769 $2,604,873 -8.6% -26.3% Veolia SouthWest City of Lodi $712,285 $362,121 $750,629 275,000 275,000 275,000 55,000 55,000 55,000 914,288 914,288 914,288 40,500 40,500 263,250 555,995 433,713 443,543 2,553,068 2,080,622 2,701,710 -156,938 -156,938 -156,938 2,396,130 1,923,684 2,544,772 -5.8% -24.4% Veolia SouthWest City of Lodi $721,188 $343,903 $763,942 302,500 302,500 302,500 60,500 60,500 60,500 925,716 925,716 925,716 41,006 41,006 112,767 534,070 321,860 449,088 $2,584,981 $1,995,486 $2,614,512 -$158,899 -$158,899 -$158,899 $2,426,082 $1,836,586 $2,455,613 1.2% -25.2% 1111ater Treatment Silver Plume, • • • • Project Experience and Qualifications Client Town of Silver Plume Time Period 2000 — Present Project Features ♦ Operations and Maintenance of Water Treatment Plant SouthWest Water Company- 6 ♦ Call sybUc111 UIU IIUL iilee< LIM tuqumreinenL iur virus rernvvdi dL UP specific flow rate. Moreover, the system's limited capacity eventually Cove Coveraagege exceeded its ability to serve the town's 200 residents. ♦ Microfiltration The community therefore decided to utilize federal grant money to Technology with construct a state-of-the-art microfiltration facility. Most of the water Disinfection by entering the plant comes from nearby Clear Creek, and the 0.2 MGD Hypochlorite plant (launched in 2000) disinfects this raw feed with sodium hypochlorite before pushing it through microfiltration membranes. ♦ Regulatory Compliance Although microfiltration is a sophisticated treatment process, it's also Management one of the easiest to operate and maintain. Our "C" class licensed operator visits the facility once a week for several. hours and has remote access to the SCADA system, ensuring that he is instantly notified if there are any system issues. This plant has run without a hitch since the beginning and our treated water has been consistently meeting federal and state quality standards since the start of the contract. The preparedness of our staff was tested in March 2003, when an avalanche brought in 6 feet of snow, smashing the chlorine contact building, bringing down power lines and blocking the access road. Local water supplies were contaminated, which triggered a boil water notice that had to stay in effect until we regained access to the plant and coordinated repairs. SouthWest Water operates several facilities within close proximity of this plant and therefore, we have staff available for technical support or emergencies. Eighty pounds of explosives were needed to clear the nearby creek of debris. Our construction crew rebuilt the damaged system, and our operations and compliance staff ensured that the boil water notice was lifted as soon as possible, so that the community could again enjoy its clean drinking water. The client expressed satisfaction with this contract by renewing it every year since 2000. Case Study Aug 26 11 12:53p R Singh 2039561550 p.1 - 0 MOUNTAIN HOUSED COM MUNI TV S E R V E CES OTSTRICT 2sC 3• Y�ti11t1YG C+R�ES�TiTEtQo. r�2C2s)NrntN HQuSE_�A 9Si9t t2F19i�3i-3306 (2042 83t-!EtQ SA% w wri.movataintsmaaa-ce•as AUSttst 25, 2011 To Whaxpi it May Concem: The Mountain Ho= Community Services Disb6ct (I3CSD) has contActed with Sou*West Watm Com* to perform operadm and maimena= services fir its vvda facilities since the fimhtm bep operations in 20M. SouthWest Water Com► Wftms AV the opmawm and maiatenacre nocessmy for our 15 MCrD sudoce wew £aciiity We fees moble that the Car murity's water pm&wdoa is in good -bands with the SouthWest'Water Company. The entire staff of three have lufmmwd in an =ev4 wy uraaner mans&& our MR operadon. i SoutbNost Wmm T Company is very zeliab3es depeodisabhe, and works d igentiy tD keep tate water treatment plant in opemtion and compliance whim aU the permit requizemwRs. I vmuld happily recommend their work. In fad, the MHOD receetly chose to mad SouthWest 'mater with a new five-ycor conknot to oocfu ►ue their work for us. if I can be of f rdw assistance, plem do not hesitate to call me at 209-831-2300. Si ly, -VoumAit Own CcrmmumTy Samar ss,lksrwcT H S' Operations & Maintemm Dhwtor