City Council Meeting: February 26, 2008

Agenda Item: 1-D

To: Mayor and City Council

From: Craig Perkins, Director – Environmental and Public Works Management

Subject: Design-Build Agreement for the Charnock Well Field Restoration Project

Recommended Action

Staff recommends that the City Council:

1. authorize the City Manager to negotiate and execute a Design-Build Agreement for the preconstruction services for the Charnock Well Field Restoration Project with Black & Veatch Corporation for the amount not to exceed $4,300,000; and

2. authorize the City Engineer to issue any necessary change orders to complete additional work within budget authority; and

3. appropriate $4,300,000 from the Charnock Fund Balance into Account No. C050878.589600.

Executive Summary

In 1996, the City shut down five groundwater production drinking water wells located in the Charnock Well Field due to the presence of fuel additive methyl tertiary-butyl ether (MtBE) in the groundwater. To restore the City’s drinking water supply, staff recommends contracting with Black & Veatch Corporation to design and construct a treatment facility at the Charnock Well Field and to design and construct upgrades to the Arcadia Water Treatment Plant. The City will be able to use groundwater to produce drinking water and reduce the City’s dependence on imported drinking water after completion of these improvements.

Staff will return to City Council during design development for approval of a Guaranteed Maximum Price (GMP) Amendment for the construction of the improvements. This project is funded by a Settlement Agreement. Funds for the preconstruction services are available from Charnock Fund Balance.

Background

The City of Santa Monica’s community water system directly serves all residents, businesses and visitors. Historically, the City utilized local groundwater for a large portion of the City’s drinking water supply. All five City water wells at the Charnock Well Field were shut down in 1996 due to MtBE contamination from leaking underground gasoline storage tanks and pipelines owned by various oil companies. The Metropolitan Water District supplies approximately 80% of the City’s drinking water, and the remaining 20% is supplied by other local groundwater wells, which the City owns and operates. The purchased water from Metropolitan Water District is blended with the water from the City’s wells and is pumped to the Arcadia Water Treatment Plant prior to distribution to the public through water transmission mains.

Following several years of protracted interactions with the oil companies responsible, a comprehensive settlement agreement was reached in December 2003. The terms included in the settlement agreement between the City and the responsible parties stipulated the formation of a Charnock Engineering Committee to coordinate and direct the design, construction, and operation of a treatment facility to restore the Charnock Well Field. The Charnock Engineering Committee was created in January 2004. In December 2006, a subsequent Settlement Agreement gave the City of Santa Monica sole oversight and management of the restoration of the Charnock Well Field. Thereafter, a methodology for the restoration of the Charnock wells was developed by City staff which accelerates the design, construction, and operation of an MtBE treatment facility. It is anticipated that water from the new treatment facility will be delivered to the community by the end of 2010.

Discussion

In December 2006, the City of Santa Monica assumed full control of restoring the Charnock Well Field through a new settlement agreement with the oil companies. It is proposed to use a Design-Build project delivery method to construct a treatment facility at the Charnock Well Field and construct upgrades to the Arcadia Water Treatment Plant.

A Preliminary Design Report for the Charnock Well Field Restoration Project was completed by the firm, Komex, in July 2007. This report recommended a treatment system consisting of filtration with granular activated carbon to remove the MtBE from three contaminated wells. The treated groundwater will be combined with water pumped from two clean wells and the total flow will be pumped to the Arcadia Water Treatment Plant for final treatment and distribution. Final treatment system upgrades necessary at the Arcadia Water Treatment Plant include softening, disinfection and fluoridation.

Contractor/Consultant Selection

In September 2007, the solicitation process began with a Request for Proposals (RFP) to fourteen (14) companies for Design-Build Services followed by a Notice of Inviting Proposals for the Design-Build Services, published in the Santa Monica Daily Press and posted on the City’s website. A job walk was then scheduled for October 4, 2007, of the Treatment Plant where twelve (12) companies were represented. On October 30, 2007, Black & Veatch Corporation, CH2M HILL, Inc., and Tetra Tech, Inc. submitted proposals for the Design-Build Services.

A selection committee comprised of staff from Environmental and Public Works Management Department reviewed each proposal. The selection criteria included groundwater restoration experience; Design-Build experience; acceptance of contract terms; bond and insurance capacity; claims and litigation history; safety record; depth of services; project approach; risk allocation; staff qualifications and experience; project manager experience; responsiveness; ability to deliver the project on time and on budget; creativity and flexibility; community awareness; and regulatory knowledge. The selection committee reviewed the proposals based on the selection criteria requirements.

Black and Veatch Corporation’s proposal included a comprehensive work plan and implementation schedule to deliver the project ahead of schedule. Their approach included a 90-day action plan to be implemented at the beginning of the project to expedite the completion of the improvements. Black and Veatch Corporation’s approach will reduce dependency on imported water earlier, resulting in $350,000 to $400,000 savings per month to the City. Black and Veatch Corporation proactively met with regulatory agencies during the proposal process to explore recommendations for various permit compliance issues that will be necessary to produce drinking water. Lastly, Black and Veatch Corporation’s proposed preconstruction services fee was approximately 35% less other than proposals.

Black & Veatch Corporation has extensive experience in water treatment projects using the Design-Build project delivery method. Three (3) Design-Build projects that were successfully completed by Black and Veatch Corporation are the Lake Pleasant Water Treatment Plant, the Foothill Pump Station and the Northeast Bakersfield Membrane Facility. References for these projects were contacted and indicated that the services provided by Black & Veatch Corporation were professional, within budget and on schedule. Additionally, Black & Veatch Corporation’s staff proposed on this Project has successfully completed work on various City of Santa Monica projects, including Parking Structure No. 4 Seismic Retrofit; Water Main Replacement Project; Centinela Avenue Water Quality Improvement Project; Santa Monica Urban Runoff Reclamation Facility project; and the Colorado Ocean Relief Sewer Project.

Based on the review of the proposals and interviews with the firms, the selection committee unanimously recommends entering into a Design-Build Agreement with Black & Veatch Corporation for the Charnock Well Field Restoration Project.

Financial Impacts & Budget Actions

Staff is requesting that additional funds in the amount of $4,300,000 be appropriated from the Charnock Fund Balance into Account No. C050878.589600 “Charnock Well Field Restoration Project” to proceed with the project.

Prepared by: Spiros Lazaris, P.E., Civil Engineer

Approved:	Forwarded to Council:
Craig Perkins Director - Environmental and Public Works Management Department	P. Lamont Ewell City Manager