Loading...
HomeMy WebLinkAbout02-12-16_AgendaPkt Metropolitan Wastewater Management Commission A NIN, SPRINGFIELD �i OREGON partners in wastewater management MWMC MEETING AGENDA Friday, February 12, 2016 @ 7:30 a.m. City of Springfield City Hall, Library Meeting Room 225 Fifth St., Springfield, OR 97477 Please Turn Off Cell Phones 7:30 — 7:35 I. ROLL CALL 7:35 — 7:40 II. CONSENT CALENDAR a. MWMC 1/8/16 Meeting Minutes Action Requested: By motion, approve the Consent Calendar 7:40 — 7:45 III. PUBLIC COMMENT 7:45 — 8:10 IV. REVENUE BOND COST REDUCTION — RESOLUTION 16-02 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Meg Allocco, Katherine Bishop Action Requested: By motion, approve Resolution 16-02 8:10 — 8:20 V. FY 2015-16 SUPPLEMENTAL BUDGET #2(b) . . . . . . . . . . . . . Meg Allocco Action Requested: By motion, approve Resolution 16-03 8:20 — 8:30 VI. FACILITIES PLAN ENGINEERING SERVICES CONTRACT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Josh Newman Action Requested: By motion, approve Resolution 16-04 8:30 — 9:00 VII. DRAFT FY 2016-17 REGIONAL WASTEWATER PROGRAM (RWP) CAPITAL BUDGET AND 5-YEAR CAPITAL PLAN . . . . . . . . . . . . . . . . . . . . . .Troy McAllister, Josh Newman, Dave Breitenstein Action Requested: Provide comments for finalization 9:00 — 9:20 VIII. THE MWMC VIDEO SERIES. . . . . . . . . . . . . . . . . . . . . . . . . . Amber Fossen Action Requested: Information only 9:20 — 9:35 IX. BUSINESS FROM COMMISSION, GENERAL MANAGER, AND WASTEWATER DIRECTOR (Continued on back) THE FULL PACKET IS POSTED ON THE WEBSITE www.mwmcpartners.or_q 9:35 X. ADJOURNMENT The meeting location is wheelchair-accessible. For the hearing-impaired, an interpreter can be provided with a 48-hour-notice prior to the meeting. To arrange for service, call 541-726-3694. All proceedings before the MWMC are recorded. THE FULL PACKET IS POSTED ON THE WEBSITE www.mwmcpartners.or_q AGENDA ITEM Ila. Metropolitan Wastewater Management Commission SPRINGFIELD OREGON partners in wastewater management MWMC MEETING MINUTES Friday, January 8, 2016 @ 7:30 a.m. City of Springfield City Hall, Library Meeting Room 225 Fifth St., Springfield, OR 97477 President Loud opened the meeting at 7:30 a.m. Roll call was taken by Kevin Kraaz. ROLL CALL Commissioners Present: George Brown, Bill Inge, Doug Keeler (7:33), Hilary Loud, Walt Meyer, Joe Pishioneri and Faye Stewart Staff in Attendance: Meg Allocco, Jolynn Barker, Katherine Bishop, Steve Barnhardt, Dave Breitenstein, Michelle Cahill, Judy Castleman, Amber Fossen, Randy Gray, Bill Hamann, John Huberd, K.C. Huffman (attorney), Tonja Kling, Kevin Kraaz, Shawn Krueger, Barry Mays, Troy McAllister, Todd Miller, Josh Newman, Loralyn Spiro, Matt Stouder, Mark Van Eeckhout, and Greg Watkins Guest: Chuck Swank, Grove, Mueller & Swank, P.C. ANNOUNCEMENTS Matt Stouder, MWMC General Manager, made two announcements: 1. Amber Fossen would be taking pictures of the Commission during the meeting. 2. The agenda was revised because of the need for two of the Commissioners to leave early. The cogeneration project is closely related to the digester project but because of time constraints and the need to have the action items taken care of first, the two agenda items have been separated. CONSENT CALENDAR a. MWMC 12/11/15 Meeting Minutes MOTION: IT WAS MOVED BY COMMISSIONER PISHIONERI TO APPROVE THE CONSENT CALENDAR. THE MOTION WAS SECONDED BY COMMISSIONER STEWART. THE MOTION PASSED UNANIMOUSLY 6/0 (1 ABSENT — KEELER). PUBLIC COMMENT There was no public comment. MWMC Meeting Minutes January 8, 2016 Page 2 of 9 FUNDING FOR INCREASE DIGESTION CAPACITY (PROJECT P80084 — DIGESTER) Commissioner Meyer recused himself from any action regarding this agenda item as he is involved in the project. Troy McAllister, Managing Civil Engineer, stated that at the September 11, 2015 meeting, the Commission agreed to combine the digester and biogas cogeneration improvements into one construction bid package. However, recent information from EWEB on potential electricity rates has caused staff to reevaluate the merits of combining the two projects and it has been decided to keep them separate. (More details on this in the Cogeneration presentation.) Mr. McAllister gave the following project updates: • October 2015 DEQ approved the digester predesign report. • The sole-source procurement of the motor control center electrical equipment went through the protest period and received no protests. • The 60% design package is moving to 90%; staff has provided input to the consultant. • A pre-design report on the lagoon decommissioning project was submitted by the consultant team and staff is currently looking it over. This project is being developed as a separate construction bid package. Mr. McAllister referred to page two of the memo which listed the estimated costs. The estimated project cost is $16.65 million. The approved budget for the digester is $9.35 million. To cover the shortfall, staff recommends the Commission approve Supplemental Budget#2 which transfers $100,000 available in the Equipment Replacement Fund and $7.2 million from the capital reserves to the Increase Digester Capacity project. Commissioner Inge asked if the money to be transferred was for new work. Mr. Stouder replied that this was for new work tied to the digester project. When the 2004 Facilities Plan Update was completed, cost estimated were developed at a high level and projected out 20 years. This project is one that was scheduled at the later part of the 20-year-schedule. Some of the systems associated with the project were not scoped in 2004, but are necessary now to move forward. Mr. McAllister informed the Commission that the project would go out for bid, hopefully, in the spring of 2016. Commissioner Pishioneri asked if this work was overlooked. Mr. McAllister replied that it was due to gaining better information as the project was designed —the cost assessment from when the project was first budgeted was a rough estimation. Mr. Stouder added that the 2004 Facilities Plan only provided high level estimates, and this work was not included. Because of this, staff is looking at what else in the Facilities Plan may require further analysis so we can plan better. He said this is not typical. Commissioner Pishioneri asked if it was going to affect the user rates. Mr. Stouder said it was already anticipated and would not affect the rates. Commissioner Inge asked if all the pipes for this project were going to be moved to above ground. Mr. McAllister replied that all the pipes would be above ground. MWMC Meeting Minutes January 8, 2016 Page 3 of 9 FY 2015-16 SUPPLEMENTAL BUDGET #2 Meg Allocco, MWMC Accountant, said that the $7.2 million that is being asked for is new and was not previously budgeted somewhere else. The $100,000 was saved for equipment replacement and since some of those items are for this project, that amount could be moved to the project. She said Resolution 16-01 for the total $7.3 million could be changed to a different amount if the Commission so decides. Commissioner Inge asked what would happen if this project was not done. Mr. McAllister answered that it would affect our capacity. Mr. Stouder added the project is tied to decommissioning the lagoon, which currently is used for digester cleaning. A fourth digester would allow enough capacity internally to clean without needing the lagoon. Commissioner Inge asked if it was necessary or just something we would like to do. David Breitenstein, Plant Manager, explained in order to meet our Class B Biosolids treatment requirement we have to have at least 15 days of detention time. When a digester is taken off-line to clean it, we are pressed and sometimes have to store solids in the clarifier in order to meet the 15 days; this is what is driving the fourth digester. When a digester is added, it puts more demand on heating for all the digesters so the boiler needs to be upsized. Then the overall gas production increases over the design life and the current gas flow piping is too small in diameter to be able to convey all the gas. If the gas piping is not upsized, it increases the risk of releasing gas into the atmosphere. The gas piping, itself, has been underground in the work space that is not compliant with the current phase of the National Environmental Policy Act (NEPA) code. Getting all the pipes outside is a worker safety element. MOTION: IT WAS MOVED BY COMMISSIONER STEWART TO APPROVE RESOLUTION 16-01. THE MOTION WAS SECONDED BY COMMISSIONER PISHIONERI. THE MOTION PASSED UNANIMOUSLY 6/0. COMMISSIONER MEYER WAS RECUSED. FY 2016-17 BUDGET KICK-OFF: KEY OUTCOMES AND PERFORMANCE INDICATORS Mr. Stouder went over the budget and rate highlights. For FY 2015-16 the Commission adopted a 2% rate increase. Revenues are on target year-to-date, with the SDCs slightly above target. They are hard to forecast because the SDC revenues depend on growth in the community. Expenditures are below budget year-to-date and that has to do with the timing of expenditures (Capital projects), vacancies in positions, and new hires starting at a lower pay grade. On the Reserve side, appropriate balances are being maintained. The Insurance Reserve increased from $500,000 to $515,000 in Supplemental Budget #1 based on input from the Commission and insurance premium cost savings resulting from increasing the insurance deductible from $100,000 to $250,000. On the Capital Reserve side we have $50 million, plus about $11 million in Equipment Replacement Reserves. The Capital Reserves may be impacted depending on how the Commission decides to move forward with plans to reduce debt obligations. Mr. Stouder stated that each year staff looks at the Key Outcomes to make incremental changes so outcomes/indicators are more meaningful. There were slight changes to some outcomes this year. In particular, Outcome 5 was tweaked slightly (Public Awareness and Understanding) with respect to the community survey work that was done, the work the subcommittee did with staff on communications, and with respect to the 2015 Communication Plan. MWMC Meeting Minutes January 8, 2016 Page 4 of 9 Mr. Stouder said that the major issues/challenges the MWMC will see are the ones we have been talking about for the past several years. On the Capital side we are planning to reduce our debt obligations. On the regulatory side, there are a lot of things looming like temperature and toxics standards. Staff will be coming back to the Commission this spring to talk about temperature and water quality trading. The National Marine Fisheries Services (NMFS) recently issued a biological opinion with respect to temperature. Staff will inform the Commission on how that is rolling out. We had a successful Pretreatment audit this year and there are a few things staff is responding to, including evaluating our local limits in response to the audit. We are going to look at current water quality standards, how they might apply if we have a new permit, and where there might have short falls. Michelle Cahill, Wastewater Director, discussed the status of four of the five Key Outcomes' and work plans. Mr. Stouder spoke on Key Outcome 5. 1. Environmental Standards: MWMC is in compliance with permit requirements, and we have a CMOM program for the collection systems to address wet weather flows. We also have an Environmental Management System — this year we are working on reducing pesticide use and improving our energy usages. 2. Financial Management: The audited finance statements report shows the MWMC is in a positive financial position. The uninsured bond rate of AA demonstrates strong creditworthiness based on the MWMC's ability to repay its debt. In addition, the Commission is planning to reduce debt obligations. 3. Intergovernmental Partnership: The Pretreatment Program is an example of where we have formed regional teams to work on the audit improvements that we want to make, such as working together regionally on the CMOM program. We are also looking to work together on the MWMC's mission/imaging/vision over the next year. 4. Reliability/Useful Life of Assets: Plant staff has a great software program, Maximo, which tracks all work orders. Staff is doing a good job on preventive maintenance which helps keep operational costs down. Eugene staff has gone mobile with Maximo by using iPads that can input data out in the field. 5. Public Awareness: Targets have been revised to be more measurable. The four prevent pollution campaigns have been reduced to two, but will be made longer and bigger so that they reach more than 20% of the people in the service area. The MWMC educational video series is planned to be released in early 2016. There are three, five- minute videos that staff will show at the next Commission meeting. Katherine Bishop, ESD Program Manager, went over the budget and rate assumptions. She said that they haven't changed much over the last couple of years because the MWMC is on a stable financial forecast. • Personnel Services: based on contracted salary and benefit programs (Eugene's COLAs are based on CPIs for the year; Springfield's salaries are based on a market survey that is conducted about every three years). Commissioner Inge asked if the new Oregon sick leave law would affect the MWMC. Ms. Bishop replied that on the Springfield side there would not be any difference. John Huberd, MWMC Meeting Minutes January 8, 2016 Page 5 of 9 Finance and Administrative Manager, answered that for the Eugene side, the only affect is from the temporary/seasonal workers that are employed through an agency and that may be about a 5% increase. Additional budget and rate assumptions include: • Materials & Services: These are related to ongoing maintenance of aging and expansion of infrastructure. Staff continues to seek operational efficiencies to moderate rate changes. • Assumes stable revenues, user fees are on target. • Strategic transfers to Capital fund from the user fees in order to move towards pay-as-you- go capital investments and not have future debt. Also looking at reducing our existing debt obligations. • Capital Improvement Program (CIP) Plan: The proposed CIP Budget includes 4% annual inflationary adjustment on project costs. • Equipment Replacement Reserve: This is reviewed annually and staff anticipates the reserve amount going down some. • Reserves are in-line with the MWMC Financial Plan and Capital program requirements are in compliance with Bond Covenants >1.25 debt service coverage ratio. • System Development Charges (SDC) revenues are used to pay debt service for those projects that is attributable to new development and has a capacity component to it. There are also performance projects that have a component that is attributable to new development. Ms. Bishop went over the budget and rate decision schedule. Next month staff will present the draft Capital Program. Also Ms. Bishop and Ms. Allocco hope to have additional information on the revenue bond discussion. In March, staff will come back with the preliminary budget document and rate scenarios and in April a public hearing will be held for the Commission to consider adoption of both the rates and the budget. From there the budget will be taken to the Springfield City Council on Monday, May 2 for approval/ratification; to the Eugene City Council on Monday, May 9; and the Lane County Board of Commissioners on Tuesday, May 17. The budget would then come back to the MWMC on Friday, June 10 for final ratification. FY 2014-15 AUDITED FINANCIAL STATEMENTS AND REPORT Ms. Allocco along with Chuck Swank from Grove, Mueller & Swank made the presentation. Ms. Allocco stated the audit went well and Mr. Swank agreed. Ms. Allocco said there were some challenging governmental standards issued this year that Mr. Swank's company helped staff implement correctly. Mr. Swank said he would answer any questions the governing body has about the audit. He then explained the three Auditor reports within the Financial Report. The first report at the front of the Financial Report says the MWMC is in compliance meaning the auditors agree the financial statements present fairly and in accordance with guidance of the generally accepted accounting principles. The next two reports are found at the back of the Financial Report. The first of these two reports is for the State of Oregon and states the auditors found the MWMC in compliance with state regulations. The second report is for the federal government. It states the MWMC has internal control over its financial reporting and is in compliance with meeting the federal standards. MWMC Meeting Minutes January 8, 2016 Page 6 of 9 Next, Mr. Swank spoke about the new accounting requirement to show pension liability within the financial statements. He said on a budgetary basis it does not affect MWMC because we have been paying into the appropriate pension plan the amounts assessed every payroll. Where it does affect the MWMC is when switching from the budgetary reports to the front financial statements that moved from cash accounting to full accrual accounting. The cities had to implement the requirement to report their liabilities related to pensions. There were significant timing differences because the audit of the pension plan and the actuarial evaluations could not be done by June 2015. Staff has been reporting of both of these liabilities but there is a lag plus there is a Supreme Court case in the middle of it that will also impact us moving forward. The MWMC has a responsibility to the cities for the part of the pension liability that relates to employees that work with the MWMC. Commissioner Inge asked why the Capital Improvement projects are still talked about in 2006 dollars - he referred to page 8 under Economic Factors and Next Year's Budget and Rates: $196 million (in 2006 dollars). Ms. Bishop replied that 2006 was the re-costing of the 2004 project list. It was anticipated (at that time) that the NPDES permit renewal would have already occurred and based on its requirements we would have a new project list with new project costs. The Comprehensive Facilities Plan Update was pushed out in the adopted budget to 2018. There were some changes made in the Partial Facilities Plan. Commissioner Inge said that he understands that but it seems strange that we are still using 2006 dollars instead of stating amounts in 2016 dollars. Mr. Swank replied that management writes this part of the document and it has no impact on the financial statements. MOTION: IT WAS MOVED BY COMMISSIONER KEELER TO ACCEPT THE ANNUAL FINANCIAL REPORT, INCLUDING FINANCIAL STEMENTS FOR FY 2014-15. THE MOTION WAS SECONDED BY COMMISSIONER MEYER. THE MOTION PASSED UNANIMOUSLY 7/0. Commissioner Stewart and Commissioner Inge left the meeting at 8:22 a.m. K.C. Huffman, MWMC's attorney, announced that the meeting was now without a quorum. He said that the meeting could continue but the Commission cannot deliberate or make any decisions without a quorum. BIOGAS COGENERATION SYSTEM REPLACEMENT: FINANCIAL CHANGES Greg Watkins, Management Analyst II, discussed some of the changes EWEB has indicated they will be likely making regarding the electrical rate structure and how it would impact the Cogeneration project. Currently, the EWEB bill is comprised of three different charges: • Base charge - a flat rate for being connected to the grid (-10% of bill) • Demand charge - based on the highest peak load used during the billing period (-25% of the bill) • Variable charge - based on the total amount of power consumed during the billing period (-65% of the bill) During the planning phase of the Biogas Utilization project, staff approached EWEB and discussed future rate projections associated with the life of the Cogeneration system. At that time, EWEB anticipated an annual 3% rate increase with no change in the rate structure. However, in December, EWEB staff informed the MWMC they would be recommending to their MWMC Meeting Minutes January 8, 2016 Page 7 of 9 Board a new rate structure which would increase the proportion of the fixed charges to approximately 60% and 40% on a lower variable rate. EWEB's Board did not approve the new rate structure, and instead referred the matter to a Citizen's Advisory Committee. Because the outcome of EWEB's rate structure is unknown at this time, the Cogen project has been put on hold. Staff will not be applying for the Oregon Department of Energy Grants. The Cogen project and the Digester project will no longer be combined. There are some shared electrical infrastructure components that both the Cogen and the Digester projects have in common. The portion that was going to be covered by the Cogeneration project will need to be transferred and picked up by the Digester project. MWMC staff is continuing to meet with EWEB to determine if a mutually established rate structure can be agreed upon that would make moving forward with a larger cogeneration more feasible financially. Once the best available financial information is known, staff will reevaluate cogeneration alternatives and associated project payback scenarios, while maintaining consideration of environmental and social values. Staff anticipates coming back to the Commission in the spring of 2016 with updated information and recommendations. Mr. Stouder added that staff has met with EWEB staff a couple of times and they have not instilled confidence that something other than what EWEB staff is proposing will be moving forward. They prepared projected rate structures to show us where they think the electrical rates will be, and the proposed rates showed that we would need to come up with an additional $140,000 per year to make the project break even at the end of life (18 yrs). That does not consider environmental or social aspects but purely financial. It also assumes we will optimally run the cogeneration unit, meaning minimal down time. If the Cogeneration system is down for 15 minutes, EWEB would have to secure power for us. It is somewhat complex, but EWEB has to secure power from the grid for us regardless of if we are down for 15 minutes or 15 hours --- our demand is the same. Staff will continue to work with EWEB to see if a better solution exists, however, we are time constrained because the Cogen engine does need to be rebuilt or replaced by March of 2017. Therefore, staff will also reevaluate the three options that were looked at previously; the 1.2, 0.8 rebuild, and a new 0.8 to see what looks best. Commissioner Meyer asked if the current engine would continue to be used. Mr. Watkins replied that it would, although staff was hoping to have a larger engine operational before the scheduled rebuild in February or March of 2017 so there wouldn't be any down time. Commissioner Meyer asked if it was a partial rebuild or total and if it could be deferred for a year if needed. Mr. Watkins replied that it is a complete rebuild and that the scheduled date was a best estimate based on run time hours. He said staff would evaluate when the rebuild would need to take place depending on the oil samples and vibrations of the engine. Commissioner Meyer stated that there was a time when you could negotiate for power from other entities besides EWEB, is that still viable. Mr. Watkins replied that he did not know. Commissioner Keeler asked if we can contract out our power somewhere else besides EWEB. Josh Newman, Managing Civil Engineer, stated that we have not looked into it but that from his understanding, Bonneville Power's transmission system comes into play and they control how and when power can be exported. MWMC Meeting Minutes January 8, 2016 Page 8 of 9 Commissioner Keeler said that what EWEB is proposing not only affects the MWMC but also co-generators everywhere or anyone who thinks they are going to sell power back from the solar panel on their roof. Mr. Stouder said yes, the rate structure they are proposing does not incentivize conservation. Commissioner Pishioneri commented that it seems counter intuitive that we have a power company that will charge more even though we are saving more energy. He thinks it is in the public's interest to know what the MWMC's situation is, and said we should consider submitting a document to the EWEB Board. Mr. Stouder replied that we could consider sending a letter to the EWEB Board. Commissioner Meyer said that he would like to have the Commission informed by Mr. Stouder on the scheduling and activities of the citizen advisory committee. He thinks it would be beneficial if someone from MWMC was represented on the committee. Mr. Stouder stated that he will keep the Commission advised on the scheduling of the citizen committee. Commissioner Loud and Commissioner Pishioneri stated that they concur with Commissioner Meyer. BUSINESS FROM COMMISSION, GENERAL MANAGER, AND WASTEWATER DIRECTOR General Manager: • Property transfer associated with MWMC's IGA. Mr. Stouder informed the Commission there were tax lots still in the City of Eugene's name for MWMC owned properties that are being transferred to the MWMC. We have owned and operated them for some time and this process is a formality. • General Liability Insurance. Our initial assumption was a 3% increase this year but we actually had a premium decrease of 11.6% ($3,800). We have seen a 24% reduction in our premium since switching to Special Districts Insurance Services. • Bill Hamann, City of Springfield Environmental Services Program Manager, is retiring from the City of Springfield and his retirement party will be January 29th at Roaring Rapids Pizza. Mr. Stouder said that he really appreciated Mr. Hamann's time, energy, and input. o Commissioner Keeler requested an email be sent out to the Commission about the retirement party. Mr. Stouder replied he would. Wastewater Director: • EWEB gave the MWMC a rebate of$1,920 for changing the lighting at the parking lots and roadways at the plant. • Successful month for treatment despite the December weather. Staff saw fast rising and fluctuating plant flows throughout the month with twice the normal rainfall. Despite these challenges, we averaged three times the volume treated in November and all our flows received full treatment. There were no sanitary sewer overflows. We did have three after- hours pump station alarms that we responded to and had to use an emergency generator at one of the locations. In December there was a total of 13.6" of rain and the average plant flow was 67.7 mgd; the peak flow was 152 mgd. Overall the average removal was 97% for BOD and total suspended solids. Our winter permit says 25 and 30 mg per liter respectively, but we discharged at 5 mg per liter and 8 mg per liter. Excellent work by all of the staff but especially the Operations staff. MWMC Meeting Minutes January 8, 2016 Page 9 of 9 o Commissioner Keeler said that on the solids for TSS, he is sure that we were much cleaner than the river. ADJOURNMENT President Loud adjourned the meeting at 8:47 a.m. AGENDA ITEM IV. Metropolitan Wastewater Management Commission SPRINGFIELD OREGON partners in wastewater management MEMORANDUM DATE: February 5, 2016 TO: Metropolitan Wastewater Management Commission (MWMC) FROM: Meg Allocco, Accountant Katherine Bishop, ESD Program Manager SUBJECT: Revenue Bond Cost Reduction - Resolution No. 16-02 ACTION Adoption of Resolution No. 16-02 Authorizing the Sale of Regional REQUESTED: Sewerage Facilities Revenue Refunding Bonds ISSUE Staff is requesting the Commission approval of Resolution No. 16-02 authorizing the sale of regional sewerage facilities revenue refunding bonds. Adoption of this resolution will allow for the payoff of the 2006 revenue bonds, and an advance refunding of the 2008 revenue bonds within FY 2015-16, for the purpose of debt service savings. BACKGROUND At the October 2015 meeting, staff provided background information on the 2004 Facilities Plan, and the 2006 and 2008 revenue bond issuances. The discussion focused specifically on cost reduction of the 2006 revenue bond debt, and three refinancing scenarios were provided for discussion and input. In addition, a summary of the cash reserve components was provided. At the November 2015 meeting, and based on input from the October meeting, staff presented information including two scenarios: (1) paying down a portion of the 2006 revenue bond debt, and refinancing the remaining debt balance at an estimated 2% interest rate for a short term or; (2) paying off the 2006 revenue bond debt obligation with capital reserve funds. In addition, staff presented the projected fiscal impact on the capital reserve balance with current debt obligations, in comparison to the two scenarios. Input from Commissioners indicated a preference for paying off the 2006 revenue bonds. Following the November meeting, staff's next steps included: (1) monitoring cost estimates for capital projects and development of the updated capital plan and updated cash flow spend-down; (2) continue to explore opportunities for savings on the 2008 revenue bond debt, and; (3) update the Commission in late summer 2016. Memo: Revenue Bond Cost Reduction - Resolution No. 16-02 February 5, 2016 Page 2 of 2 DISCUSSION Following the November Commission meeting, staff has continued to work with the MWMC's financial advisor and bond counsel on a debt service cost savings strategy for the 2006 and 2008 revenue bond debt obligations. Currently, the combined approach includes paying off the 2006 revenue bond debt, plus an advance refunding on the existing 2008 revenue bond debt at a lower interest rate (resulting in 2016 revenue bonds), with a simultaneous closing in the current FY 2015-16. The annual payment on the proposed 2016 revenue bonds would remain the same, $4 million annually, as the current annual payment on the 2008 revenue bonds. The term of the 2016 revenue bonds assumes 10-years beginning November 1, 2016 through November 1, 2026, retiring the bond obligation two years earlier. The approach includes paying off the 2006 revenue bonds via an escrow account, plus an advance refunding of the 2008 revenue bonds and closing on the 2016 bond sale in the current FY 2015-16. This will allow for the 2006 and 2008 revenue bonds to be "off the books" from an accounting and budget standpoint within this fiscal year. Staff will present additional information; including fiscal impact on the capital reserve spend-down based on the 2006 revenue bond payoff and 2008 advance refunding, while taking into consideration the proposed capital program plan for the FY 2016-17 Budget, and updated cash flow projections. RECOMMENDATION Staff is seeking discussion and input from the Commission. ACTION REQUESTED By motion, adopt Resolution No. 16-02 (Attachment 1) authorizing the sale of regional sewerage facilities revenue refunding bonds, for the purpose of debt service savings. ATTACHMENTS 1. Resolution 16-02 METROPOLITAN WASTEWATER MANAGEMENT COMMISSION RESOLUTION 16-02 ) A RESOLUTION AUTHORIZING THE SALE OF REGIONAL SEWERAGE FACILITIES REVENUE REFUNDING BONDS WHEREAS, the Metropolitan Wastewater Management Commission (the "Commission") has two series of outstanding bonds, the Wastewater Revenue Bonds Series 2006, and Wastewater Revenue Bonds Series 2008 (collectively, the "Refunding Candidates"); and, WHEREAS, the Refunding Candidates were issued under the Commission's Master Regional Sewerage Facilities Financing Declaration dated November 14, 2006 (the "Master Declaration"); and, WHEREAS, current interest rates are lower than the rates borne by the Refunding Candidates, and the Commission may be able to reduce its debt service expense by refunding all or a portion of the Refunding Candidates; and, WHEREAS, Oregon Revised Statutes ("ORS") ORS 287A.360 to 287A.375 authorize the Commission to issue revenue bonds to refund outstanding borrowings like the Refunding Candidates; NOW, THEREFORE, BE IT RESOLVED BY THE GOVERNING BODY OF THE METROPOLITAN WASTEWATER MANAGEMENT COMMISSION, LANE COUNTY, OREGON,that: Section 1. Refunding Bonds Authorized 1.1 The Commission hereby authorizes the issuance of refunding bonds (the "Refunding Bonds")pursuant to Oregon Revised Statutes Sections 287A.360 to 287A.375 to refund all or any portion of the Refunding Candidates that may be refunded to produce debt service savings. The Refunding Bonds authorized by this Section 1 may be issued in an aggregate principal amount sufficient to defease or pay the bonds that are selected for refunding pursuant to Section 2.1(4) of this resolution and to pay costs related to the Refunding Bonds. 1.2 The Refunding Bonds shall be issued as Parity Bonds under the Master Declaration and special obligations of the Commission that are payable solely from the revenues of the Commission's regional sewerage facilities and the related amounts as described in the Master Declaration. Section 2. Delegation 2.1 The Executive Officer of the Commission, the General Manager, or the designee of the Executive Officer of the Commission, or any person designated by the governing body of the Commission to act as on behalf of the Commission under this resolution (any of whom is ATTACHMENT 1 Page 1 of 3 referred to in this resolution as a"Commission Official") may, on behalf of the Commission and without additional action by its governing body: (1) Sell and issue the Refunding Bonds in one or more series. (2) Participate in the preparation of, authorize the distribution of, and deem final the preliminary and final official statements and any other disclosure documents for each series of the Refunding Bonds. (3) Establish the final principal amounts, maturity schedules, interest rates, sale prices, redemption terms, payment terms and dates, and other terms for each series of the Refunding Bonds, select one or more lenders or underwriters and negotiate the terms of the sale of any series of Refunding Bonds with those lenders or underwriters, or publish a notice of sale, receive bids and award the sale of that series to the bidder complying with the notice and offering the most favorable terms to the Commission. (4) Revise the Master Declaration if the Commission Official finds it desirable for the Commission or to market the Refunding Bonds. (5) Select all or a portion of the Refunding Candidates to be refunded. (6) Use available resources to prepay or defease any of the Refunding Candidates that are not being refunded by the Refunding Bonds. (7) Enter into escrow deposit agreements and take any other actions to call, defease and redeem the Refunding Candidates being refunded or which the Commission chooses to prepay with available resources. (8) File advanced refunding plans with the State of Oregon, as necessary (9) Undertake to provide continuing disclosure for each series of the Refunding Bonds in accordance with Rule 15c2-12 of the United States Securities and Exchange Commission. (10) Finalize the terms of, execute and deliver a supplemental bond declaration or similar document for each series of Refunding Bonds, which memorializes the terms under which the series is issued and which may contain additional covenants that the Commission Official determines are desirable to facilitate the sale of Refunding Bonds or obtain more favorable terms for the Commission. (11) Appoint and enter into agreements with paying agents, verification agents, escrow deposit agents and other professionals and service providers. (12) Apply for ratings for each series of the Refunding Bonds, determine whether to purchase municipal bond insurance or obtain other forms of credit enhancements for each series of the Refunding Bonds, enter into agreements with the providers of credit enhancement, and execute and deliver related documents. ATTACHMENT 1 Page 2 of 3 (13) Issue any qualifying series of Refunding Bonds as "tax-exempt bonds" bearing interest that is excludable from gross income under the Internal Revenue Code of 1986, as amended, (the "Code") and enter into covenants for the benefit of the owners of those series to maintain the excludability of interest on those series from gross income under the Code. (14) Issue any qualifying series of Refunding Bonds as "federal subsidy bonds" that are eligible for federal interest rate subsidies but bear interest that is includable in gross income under the Code and take any actions that are required to qualify for those federal interest rate subsidies. (15) Issue any series of Refunding Bonds as "taxable bonds" bearing interest that is includable in gross income under the Code. (16) Designate any series of Refunding Bonds as a qualified tax-exempt obligation pursuant to Section 265(b)(3) of the Code, if applicable. (17) Execute and deliver any documents and take any other action in connection with the Refunding Bonds that the Commission Official finds will be advantageous to the Commission. Section 3. Effective Date This resolution shall take effect on the date it is adopted. ADOPTED BY THE METROPOLITAN WASTEWATER MANAGEMENT COMMISSION OF THE SPRINGFIELD-EUGENE METROPOLITAN AREA ON THE 12th DAY OF FEBRUARY 2016. President: Hillary Loud ATTEST: Secretary: Kevin Kraaz Approved to form: MWMC Legal Counsel: K.C. Huffinan ATTACHMENT I Page 3 of 3 AGENDA ITEM V. Metropolitan Wastewater Management Commission SPRINGFIELD OREGON partners in wastewater management MEMORANDUM DATE: February 5, 2016 TO: Metropolitan Wastewater Management Commission (MWMC) FROM: Meg Allocco, MWMC Accountant SUBJECT: FY 2015-16 Supplemental Budget#2(b) ACTION REQUESTED: Approve Resolution 16-03 ISSUE The purpose of this memo is to request approval of Resolution 16-03 authorizing the proposed supplemental budget request for FY 2015-16. In January the Commission approved an item for the Digester Capacity project in supplemental budget #2. This bond refinancing was not included at that time because staff did not yet have preliminary numbers or dates for this proposed transaction. Subsequent to the January meeting, financial advisors and bond counsel have provided staff with a more detailed proposal. DISCUSSION • Staff is requesting supplemental budgets allowing the payoff of the 2006 revenue bond balance, as well as the refinance of the 2008 revenue bond. This will retire $69.4 million dollars of existing bond obligations through a combination of a capital contribution ($28 million), and bond reserves being contributed to principal ($8.1 million) for a combined contribution of$36.1 million, plus the new refinanced 2016 obligation at $33.3 million. The supplemental budget outlined in the resolution will make provisions for bond sale costs, interest expense and the necessary transfers between funds for accounting purposes. • This supplemental budget is unnecessary if the Commission chooses not to approve the combined actions on the 2006 and 2008 revenue bonds discussed in the previous agenda item IV. ACTION REQUESTED Approve, by motion, Resolution 16-03 authorizing the budget actions requested in this memorandum. ATTACHMENTS 1. Resolution 16-03 METROPOLITAN WASTEWATER MANAGEMENT COMMISSION RESOLUTION 16-03 ) IN THE MATTER OF APPROVAL OF FISCAL YEAR 2015-16 SUPPLEMENTAL BUDGET#2(B) WHEREAS, the Metropolitan Wastewater Management Commission (MWMC) approved the FY 2015-16 Budget on April 10, 2015 pursuant to Resolution 15-04; WHEREAS, the MWMC adopted Resolution 16-02 on February 12, 2016 authorizing the sale of regional sewerage facilities revenue refunding bonds to be able to reduce its debt service expense; WHEREAS, an increase of$16,000 in bond sale expense transferred from the operating reserve is deemed appropriate to cover costs of retirement of the 2006 revenue bonds; WHEREAS, an increase of$450,000 in bond sale expense transferred from the 2008 revenue bond reserve is deemed appropriate to cover the costs of the advance refunding of the 2008 revenue bonds; WHEREAS, an increase of$3,550,000 in bond principal payment transferred from the 2008 revenue bond reserve is deemed appropriate to apply to the principal balance of the 2008 revenue bonds; WHEREAS, an increase of$715,000 in interest expense transferred from the 2006 revenue bond reserve is deemed appropriate to cover the final interest payment in escrow of the 2006 revenue bonds; WHEREAS, an increase of$3,385,000 in principal payment transferred from the 2006 revenue bond reserve is deemed appropriate to contribute toward the retirement of the 2006 revenue bonds; WHEREAS, an increase of$27,995,000 in principal payment transferred from the capital reserve is deemed appropriate to complete the retirement of the 2006 revenue bonds; WHEREAS, MWMC has appointed Anette Spickard as its duly authorized Executive Officer for efficient execution of the day-to-day administration of MWMC business. NOW, THEREFORE, BE IT RESOLVED BY THE METROPOLITAN WASTEWATER MANAGEMENT COMMISSION THAT: The FY 2015-16 Supplemental Budget#2(b) as presented to the MWMC on February 12, 2016, is hereby approved. ADOPTED BY THE METROPOLITAN WASTEWATER MANAGEMENT COMMISSION OF THE SPRINGFIELD/EUGENE METROPOLITAN AREA ON THE 12th DAY OF FEBRUARY, 2016. President: Hillary Loud ATTEST: Secretary: Kevin Kraaz Approved as to form: MWMC Legal Counsel: K.C. Huffman ATTACHMENT 1 Page 1 of 1 AGENDA ITEM VI. Metropolitan Wastewater Management Commission SPRINGFIELD Isom— kOREGO partners in wastewater management MEMORANDUM DATE: February 5, 2016 TO: Metropolitan Wastewater Management Commission (MWMC) FROM: Josh Newman, Managing Civil Engineer SUBJECT: Facilities Plan Engineering Services Contract ACTION REQUESTED: Commission Approval of Resolution 16-04 ISSUE The MWMC has traditionally procured the services of an engineering consultant to provide "on-call" technical assistance for the continuing implementation of the MWMC's Capital Improvements Program (CIP). This assistance provides specialized technical resources to address needs that: • Span multiple projects (such as plant-wide utility assessments, general automated controls systems analysis, plant hydraulics, plant-wide electrical assessments, etc.) • Provide supplemental technical information, for example revising project cost estimation for budget planning purposes • Support staff led studies, such as biogas utilization; fats, oils, and grease (FOG); wet weather flow management/CMOM, infrastructure capacity/condition assessment • Provide engineering support for Job-Order-Contract tasks Accordingly, staff is requesting Commission approval of Resolution 16-04 authorizing the MWMC Executive Officer to enter into a Contract Amendment with CH2M Hill for Facilities Plan Engineering Services spanning FY 2015-16 though FY 2017-18. BACKGROUND Following the completion of the 2004 MWMC Facilities Plan and adoption of the recommended 20-year project list, the MWMC has had an ongoing need for "on-call" engineering consultant services. This service provides a consistent resource to further refine project definitions prior to implementation, address technical concerns spanning multiple projects, and support the broader integrity of the MWMC's CIP and wet weather planning efforts. To fill this need, the MWMC has traditionally procured a qualified engineering consultant familiar with MWMC's facilities and operation using multi-year contract periods. Memo: Facilities Plan Engineering Services Contract February 5, 2016 Page 2 of 3 Since completing the 2004 MWMC Facilities Plan, the MWMC has procured Facilities Planning Engineering contracts four times in conformance with the MWMC's model procurement rules. Table 1 below summarizes the pertinent information associated with the last three procurements: Table 1. Summary of prior Facilities Plan Engineering Services procurements Contract Execution Type of Contract Not to Applicable Date Procurement Exceed Value Procurement Rules August 14, 2006 Direct Appointment $163,000 137-48-0200 October 30, 2009 Direct Appointment $191,000 137-48-0200 November 28, 2011 Formal $400,000 137-48-0220 Procurement (RFP) (1) The November 2011 Contract bundled three scopes, each with a separate budget source as follows: Partial Facilities Plan Update budget = $110,000; Wet Weather Flow Management Plan budget = $100,000; Approximately 3 years of Facilities Plan Engineering Services budget = $190,000. DISCUSSION The MWMC is moving forward with continued Capital Program projects, needed evaluations and assessment, and ongoing planning efforts. Accordingly, staff is seeking a multi-year contract amendment for Facilities Plan Engineering Services for a not-to- exceed value (NEV) of$210,000 in accordance with the Direct Appointment provisions of the MWMC's 2014 Model Procurement Rules. Specifically, MWMC Rule 137-048- 0200(1)(d) authorizes a direct appointment procedure whereby the MWMC may renegotiate existing contracts with incumbent consultants for the continuation of a project with an estimated fee of more than $250,0001 without the need to engage in other informal or formal procurement processes as long as the certain criteria are met. These criteria and associated staff findings are provided in Resolution 16-04 which is provided as Attachment 1. Types of technical support needed include coordination of technical elements between projects, review of designs and specifications and other design assistance, flow and process modeling, facilitation of technical workshops, regulatory assistance and cost estimation. Examples of anticipated engineering technical support that may be requested under this contract amendment include: ✓ Pump station field firm capacity verification ✓ Facility wide utilities modeling (including electrical, communications, potable water, and non-potable water systems) ✓ Revised WPCF process hydraulic modeling ✓ Consultant support of miscellaneous process modeling and/or optimization efforts ✓ Design assistance and support for Job Order Contract (JOC) small projects 1. Legal Counsel advised application of Rule 137-048-022(1)(d), which considers projects with fees over $250,000. Although the estimated fee for the Scope consider herein is only$210,000, this combined with the $400,000 fee from the original agreement that was procured using a formal Request for Proposal process as described in Rule 137-48-0220, would be over$250,000. Memo: Facilities Plan Engineering Services Contract February 5, 2016 Page 3 of 3 ✓ Design and construction project cost estimation ✓ Professional feedback on planning and design documents prepared by other consultants and/or MWMC regional program staff ✓ Consulting and technical support associated with renewable energy generation and energy conservation ✓ Collection and conveyance system planning and evaluation support potentially including flow monitoring assistance for MWMC partner agencies ✓ Workshop facilitation related to partner agency CMOM and Private Lateral Program development Specific task scopes would be defined and fees would be negotiated and executed as separate task orders within the contract amendment NEV of$210,000. In addition, consultant scope and fee value would be limited to a maximum of $70,000 per fiscal year with the maximum three-fiscal-year total NEV of$210,000. ACTION REQUESTED Staff requests the Commission approve, by motion, Resolution 16-04 (attached) authorizing the Executive Officer or designee to finalize and execute a contract amendment with CH2M Hill for on-call services spanning three fiscal years for a not-to- exceed amount of$210,000. ATTACHMENTS 1. MWMC Resolution 16-04 METROPOLITAN WASTEWATER MANAGEMENT COMMISSION RESOLUTION 16-04 ) IN THE MATTER OF DIRECT APPOINTMENT OF ENGINEERING CONSULTING FIRM FOR MWMC PROJECT P80090 — ON-GOING TECHNICAL SUPPORT FOR THE MWMC FACILITIES PLAN WHEREAS, in July 2011, the Metropolitan Wastewater Management Commission (MWMC) issued a Request for Proposals following the Formal Section Procedure in accordance with 137-048-0220 of the MWMC's Model Procurement Rules with the goal of selecting an engineering consultant to provide technical services including Facilities Plan Engineering Services; WHEREAS, on August 24, 2011, the MWMC received a single proposal from CH2M HILL, which was reviewed by a team made up of City of Springfield and City of Eugene staff who subsequently recommended that the MWMC select CH2M HILL to provide the requested services; WHEREAS, on September 9, 2011 the MWMC approved Resolution 11-10 authorizing the Executive Officer or authorized designee to negotiate and execute an agreement with CH2M HILL for provision of technical services including Facilities Plan Engineering Services; WHEREAS, on November 28, 2011, following a period of negotiations the MWMC entered into an Agreement with CH2M HILL for the provision of technical services including Facilities Plan Engineering Services WHEREAS, the MWMC approved as part of the FY 15-16 Capital Budget a Facilities Plan Engineering Services project; WHEREAS, the MWMC has followed the procedures set forth in MWMC's Procurement Rules, Section 137-048-0220; WHEREAS, MWMC Rule 137-048-0200(1)(d) authorizes a direct appointment procedure whereby the MWMC may renegotiate existing contracts with incumbent consultants for the continuation of a project with an estimated fee of more than $250,000 without the need to engage in other informal or formal procurement processes as long as certain criteria are met; WHEREAS, the criteria to be met are: 1. The services consist of or are related to Architectural, Engineering, Photogrammetric Mapping, Transportation Planning or Land Surveying Services or Related Services that have been substantially described, planned or otherwise previously studied in an earlier Contract with the same Consultant and are rendered for the same Project as the Architectural, Engineering, Photogrammetric Mapping, Transportation Planning or Land Surveying Services or Related Services rendered under the earlier Contract; ATTACHMENT 1 Page 1 of 3 2. The Contracting Agency used either the formal selection procedure under OAR 137-048-0220 (Formal Selection Procedure) or the formal selection procedure applicable to selection of the Consultant at the time of original selection to select the Consultant for the earlier Contract; and 3. The Contracting Agency makes written findings that entering into a Contract with the Consultant, whether in the form of an amendment to an existing Contract or a separate Contract for the additional scope of services, will: a. Promote efficient use of public funds and resources and result in substantial cost savings to the Contracting Agency; and, b. Protect the integrity of the Public Contracting process and the competitive nature of the Procurement by not encouraging favoritism or substantially diminishing competition in the award of the Contract. WHEREAS, the General Manager has compared the original contract to the proposed contract amendment and determined that 1. The services are for engineering and/or related services, 2. The MWMC did use a Formal Selection Procedure for the original selection of the Consultant; 3. Written findings as set forth below will be included as an amendment to the Contract with the consultant; 4. The amendment of the consultant contract will promote the efficient use of public funds and resources and result in substantial cost savings to the MWMC because: a. The consultant is intimately familiar with the project and will not require any "get up to speed time," b. The expertise required for the project exists with consultant, and c. The consultant has a favorable history with other projects for the MWMC; 5. The amendment of the consultant contract will protect the integrity of the Public Contracting process and the competitive nature of the procurement by not encouraging favoritism or substantially diminishing competition in the award of the contract because: a. At the time of the original formal selection procedure the consultant was the only consultant to respond to the procurement documents, it is therefore less likely that other consultants would respond to solicitation documents at the current time; WHEREAS, the General Manager has documented his findings listed above in the procurement file; and ATTACHMENT 1 Page 2 of 3 NOW, THEREFORE, BE IT RESOLVED BY THE METROPOLITAN WASTEWATER MANAGEMENT COMMISSION: Anette Spickard, as the duly authorized Executive Officer of the MWMC, is hereby authorized to: (a) designate qualified staff to award the Facilities Plan Engineering Services contract to CH2M Hill; (b) negotiate and execute a consultant services contract with CH2M Hill for an authorized amount not-to-exceed value (NEV) of $210,000 with a cap on fees of $70,000 per fiscal year; and (c) delegate performance of project management functions including, but not limited to, issuance of notices to proceed, and contract amendments not to exceed a cumulative total of $31,500 (or 15% of$210,000). ADOPTED BY THE METROPOLITAN WASTEWATER MANAGEMENT COMMISSION OF THE SPRINGFIELD/EUGENE METROPOLITAN AREA ON THE 12TH DAY OF FEBRUARY 2016. President: Hilary Loud ATTEST: Secretary: Kevin Kraaz Approved as to form: MWMC Legal Counsel: K.C. Huffman ATTACHMENT 1 Page 3 of 3 AGENDA ITEM VII. Metropolitan Wastewater Management Commission A^M-6 IV SPRINGFIELD OREGON partners in wastewater management MEMORANDUM DATE: February 5, 2016 TO: Metropolitan Wastewater Management Commission (MWMC) FROM: Troy McAllister, Managing Civil Engineer Josh Newman, Managing Civil Engineer Dave Breitenstein, Wastewater Plant Manager SUBJECT: Draft FY 2016-17 Regional Wastewater Program (RWP) Capital Budget and 5-Year Capital Plan ACTION Commission review and input for finalization of the Draft FY 2016-17 REQUESTED: RWP Capital Budget and 5-Year Capital Plan ISSUE The first draft of the FY 2016-17 RWP Capital Budget and 5-Year Capital Plan is attached for Commission review and comment. Staff will provide a presentation of the RWP Capital Budget and 5-Year Capital Plan at the February 12, 2016 MWMC meeting. DISCUSSION The Capital Program budget has two major components: 1) The Capital Improvement Program (CIP) budget, and 2) the Asset Management Capital Program (AMCP) budget. The Capital Program section of the draft FY 2016-17 MWMC budget document (attached) provides a detailed discussion of these budgets including: • An overview of the RWP Capital Program and objectives • An overview of the RWP Capital Program funding and financial planning processes and methods • A description of the CIP status and FY 2016-17 CIP Budget • A description of the AMCP status and FY 2016-17 AMCP Budget • A summary of the 5-Year Capital Plan The proposed draft FY 2016-17 budget document anticipates the following: • CIP FY 2016-17 proposed budget $30,356,600 • AMCP FY 2016-17 proposed budget $6,585,000 • CIP 5-year planning subtotal $79,742,600 • AMCP 5-year planning subtotal $12,540,600 • RWP Capital Program 5-year planning total $92,283,200 Memo: Draft FY 2016-17 RWP Capital Budget & 5-Year Capital Plan February 5, 2016 Page 2 of 2 At the February 12, 2016 meeting, staff will provide a presentation summarizing the proposed FY 2016-17 Capital Program budget and the 5-Year Capital Plan. Staff will incorporate into the final draft of the Capital Program Budget comments received from the Commission. Staff will then present the final draft of the RWP Capital Budget at a later Commission meeting, along with the first review of the FY 2016-17 Operations Budget. ACTION REQUESTED Staff requests that the Commission review the draft FY 2016-17 Capital Program Budget and the 5-Year Capital Plan and provide comments for finalization. ATTACHMENTS 1. Draft FY 2016-17 Regional Wastewater Program Capital Budget Metropolitan Wastewater Management Commission Capital Improvement Program REGIONAL WASTEWATER PROGRAM CAPITAL PROGRAMS Overview The Regional Wastewater Program (RWP) includes two components: the Capital Improvement Program (CIP) and the Asset Management Capital Program (AMCP). The FY 16-17 CIP Budget, the FY 16-17 AMCP Budget, and the associated 5-Year Capital Plan are based on the 2004 MWMC Facilities Plan(2004 FP) and the Partial Facilities Plan Update dated June 2014. The 2004 FP was approved by the MWMC, the governing bodies of the City of Eugene, the City of Springfield, Lane County, and the Oregon Department of Environmental Quality(DEQ) in 2004. The 2004 FP and its 20-year capital project list was the result of a comprehensive evaluation of the regional wastewater treatment facilities serving the Eugene-Springfield metropolitan area. The 2004 FP built on previous targeted studies, including the 1997 Master Plan, 1997 Biosolids Management Plan, 2001 Wet Weather Flow Management Plan (WWFMP), and the 2003 Management Plan for a dedicated biosolids land application site. The 2004 FP was intended to meet changing regulatory and wet weather flow requirements and to serve the community's wastewater capacity and treatment needs through 2025. Accordingly, the 2004 FP established the CIP project list to provide necessary facility enhancements and expansions over the planning period. The CIP is administered by the City of Springfield for the MWMC. The AMCP implements the projects and activities necessary to maintain functionality, lifespan, and effectiveness of the MWMC facility assets on an ongoing basis. The AMCP is administered by the City of Eugene for the MWMC and consists of three sub-categories: ■ Equipment Replacement Program ■ Major Rehabilitation Program ■ Major Capital Outlay The MWMC has established these capital programs to achieve the following RWP objectives: • Compliance with applicable local, state, and federal laws and regulations ■ Protection of the health and safety of people and property from exposure to hazardous conditions such as untreated or inadequately treated wastewater ■ Provision of adequate capacity to facilitate community growth in the Eugene-Springfield metropolitan area consistent with adopted land use plans • Construction, operation, and management of the MWMC facilities in a manner that is as cost-effective, efficient, and affordable to the community as possible in the short and long term ■ Implementation of the Citizens Advisory Committee recommendations, which represent diverse community interests, values and involvement, and that have been adopted by the Commission as the MWMC's plans and policies ■ Mitigation of potential negative impacts of the MWMC facilities on adjacent uses and surrounding neighborhoods (ensuring that the MWMC facilities are "good neighbors" as judged by the community) ATTACHMENT 1 Page 1 of 23 Metropolitan Wastewater Management Commission Capital Improvement Program Capital Pro6ram Funding and Financial Planning Methods and Policies This annual budget document presents the FY 16-17 CIP Budget, the FY 16-17 AMCP Budget, and 5-Year Capital Plan which includes the CIP and AMCP Capital Plan. The MWMC CIP financial planning and funding methods are in accordance with the financial management policies put forth in the MWMC 2005 Financial Management Plan. Each of the two RWP capital programs relies on funding mechanisms to achieve RWP objectives described above. The CIP is funded primarily through proceeds from revenue bond sales, system development charges, and transfers from the Operating Fund to Capital Reserves. The AMCP is funded through wastewater user fees. In addition to revenue bond sales, financing for qualified CIP projects was also secured through the State of Oregon Department of Environmental Quality(DEQ)'s Clean Water State Revolving Fund(CWSRF) loan program. From 2008-2010, The MWMC secured several CWSRF loan agreements totalling $20.8 million. These 20-year loans provide the MWMC below-market interest rates, along with additional financial benefits, including: ■ $450,000 in"Sponsorship" funding allocated for riparian shade tree planting projects to help address the MWMC's pending thermal load obligations. The financing of these watershed- based projects is made available through the CWSRF program Sponsorship Option, which provides funding to the borrower to address nonpoint source water quality solutions through a reduced interest rate. The interest rate reduction allows the MWMC to invest in watershed improvements using money that would have otherwise been paid as interest on the loan. ■ $4 million funded through the American Reinvestment and Recovery Act (ARRA, or "Stimulus"). The ARRA funding provided 50% of the loan in principal forgiveness (not requiring repayment), and the remaining 50% of principal payment bearing 0% interest. This resulted in $2 million of net revenue to the CIP in addition to interest savings. The RWP's operating fund is maintained to pay for operations, administration, debt service, equipment replacement contributions and capital contributions associated with the RWP. The operating fund derives the majority of its revenue from regional wastewater user fees that are collected by the City of Eugene and City of Springfield from their respective customers. In accordance with the MWMC 2005 Financial Plan, funds remaining in excess of budgeted operational expenditures can be transferred from the Operating Fund to the Capital Reserve fund. The Capital Reserve accumulates revenue to help fund capital projects, including major rehabilitation, to reduce the amount of borrowing necessary to finance capital projects. The AMCP consists of three programs managed by the City of Eugene and funded through regional wastewater user fees: The Equipment Replacement Program, which funds replacement of equipment valued at or over$10,000 but less than $200,000; The Major Rehabilitation Program, which funds rehabilitation of the MWMC infrastructure such as roof replacements, structure coatings, etc.; and the Major Capital Outlay Program for capital items (new or replacement) with costs greater than $200,000. The MWMC assets are tracked throughout their lifecycle using asset ATTACHMENT 1 Page 2 of 23 Metropolitan Wastewater Management Commission Capital Improvement Program management tracking software. Based on this information, the three AMCP program annual budgets are established and projected for the 5-Year Capital Plan. For planning purposes, the MWMC must consider market changes that drive capital project expenditures. Specifically, the MWMC capital plan reflects projected price changes over time that affect the cost of materials and services. Until about 2003, the 20-city average Engineering News Record Construction Cost Index (ENRCCI) served as a good predictor for future inflation and was used for projecting the MWMC's construction costs. Accordingly, construction cost projections considered in the 2004 FP were based on January 2004, 20-city average ENRCCI. However, in the period 2004 through 2008, construction inflation accelerated nationally with local construction cost inflation accelerating even faster than the national average. City of Springfield staff identified this trend in 2005 and subsequently modified their inflationary projection methodology accordingly. In early 2006, the MWMC hired the consulting firm CH2M to perform a comprehensive update of project cost estimates. Following the 2006 update, the RWP's CIP assumed a general price increase of 5%per-year over the planning period. However, the MWMC continues to monitor inflationary trends to inform our forecasting of capital improvement costs. Accordingly, based on historical inflationary rates from 2006 through 2015, capital project budgets now reflect a 4% annual inflationary factor in the FY 16-17 Budget and 5-year Capital Plan. Regional Wastewater Capital Program Status and Bud6et CIP Proiect Status and Budget The FY 16-17 CIP Budget is comprised of the individual budgets for each of the active (carryover) or starting (new)projects in the first year of the 5-Year Capital Plan. The total of these FY 16-17 project budgets is $30,356,600. Each capital project represented in the FY 16-17 Budget is described in detail in a CIP project sheet that can be found at the end of this document. Each project sheet provides a description of the project, the project's purpose and driver(the reason for the project), the funding schedule for the project, and the project's expected final cost and cash flow. For those projects that are in progress, a short status report is included on the project sheet. ATTACHMENT 1 Page 3 of 23 Metropolitan Wastewater Management Commission Capital Improvement Program Completed Capital Projects In FY 15-16, the following capital projects are projected to be completed and closed out. No CIP project sheets are included for these projects because there is no expected carryover of project funds to FY 16-17. ■ Repair/Replacement of Biosolids Force Main ■ Sodium Hypochlorite Conversion ■ Influent Pumping and Headworks Expansion Carryover Capital Projects All or a portion of remaining funding for active capital projects in FY 15-16 is carried forward to the FY 16-17 Budget. The on-going carryover projects are: ■ increase Digestion Capacity ■ Operations & Maintenance Building Improvements ■ Poplar Harvest Management Services ■ WPCF Lagoon Removal/Decommissioning ■ Thermal Load Mitigation: Pre-Implementation ■ Thermal Load Mitigation: Implementation 1 ■ Facilities Plan Engineering Services • Capacity Management Operations and Maintenance (CMOM) ■ Biogas Cogeneration(a Major Capital Outlay project) Overall, the budgeting for these projects follows, and is consistent with, the 2006 CH2M estimated cost of the listed capital projects and new information gathered during design development. New Projects No new projects are anticipated for the MWMC FY 16-17 Capital Budget. ATTACHMENT 1 Page 4 of 23 Metropolitan Wastewater Management Commission Capital Improvement Program FY 16-17 Capital Budget Summary (Exhibit 12) Exhibit 12 below displays the adjusted budget and end-of-year expenditure estimates for FY 15- 16, the amount of funding projected to be carried over to FY 16-17 and additional funding for existing and/or new projects in FY 16-17. EXHIBIT 12 Summary of FY 16-17 MWMC Construction Program Capital Budget FY 15-16 FY 15-16 FY 15-16 NEW TOTAL ADJUSTED ESTIMATED CARRYOVER FUNDING FY 16-17 BUDGET ACTUALS TO FY 16-17 FOR FY 16-17 BUDGET Projects to be Completed in FY 15-16 Repair/Replacement of Biosolids Force Main 322,704 40,000 0 0 0 Sodium Hypochlorite Conversion 1,039,800 200,000 0 0 0 Influent Pumping and Headworks Expansion 285,186 285,000 0 0 0 Projects to be Carried Over to FY 16-17 Increase Digestion Capacity 16,157,068 1,437,068 14,720,000 0 14,720,000 Operations&Maint Building Improvements 14,719,167 749,167 13,970,000 0 13,970,000 Poplar Harvest Management Services 1,334,535 163,526 772,000 0 772,000 WPCF Lagoon Removal/Decommissioning 4,869,681 179,681 390,000 0 390,000 Thermal Load Mitigation:Pre-implementation 246,092 81,692 164,400 79,600 244,000 Thermal Load Mitigation:Implementation 1 ��) 730,884 171,429 131,000 0 131,000 Facilities Plan Engineering Services 97,547 67,947 29,600 70,000 99,600 Capacity Mgmt Operations Maint(CMOM) 94,454 33,058 30,000 0 30,000 TOTAL Capital Projects $39,897,118 $3,408,568 $30,207,000 $149,600 $30,356,600 Major Capital Outlay Carried Over to FY 16-17 Biogas Cogeneration(2) 2,900,000 800,000 2,100,000 3,200,000 5,300,000 TOTAL Major Capital Outlay pnzrei-yearprojeet) $2,900,000 $800,000 $2,100,000 $3,200,000 $5,300,000 Notes: (1)Thermal Load Mitigation:Implementation 1 budget includes Mill Race Sponsorship($200,000)and Cedar Creek Sponsorship($250,000). (2)Biogas Cogeneration is multi-year Major Capital Outlay project,a detail sheet is located at the end ofthis document. FY 16-17 Asset Management Capital Proiect Status and Budget The AMCP consists of the following three programs: ■ Equipment Replacement ■ Major Rehabilitation ■ Major Capital Outlay ATTACHMENT 1 Page 5 of 23 Metropolitan Wastewater Management Commission Capital Improvement Program The FY 16-17 budget and status of each program is described below: Equipment Replacement Program -Budget The FY 16-17 Capital Programs budget includes $381,000 in Equipment Replacement purchases that are identified on the table below. Equipment Replacement FY 16-17 Project Description Budget Aerial Lift 100,000 Fleet Replacement 90,000 Diesel Generator, 80 KW 80,000 Inductively Coupled Plasma Spectrometer - Lab 77,000 Security Camera System 25,000 Computer File Server 9,000 Total $381,000 Aerial Lift. Provides access for regular and ongoing maintenance of overhead facilities and equipment such as indoor/outdoor lighting, electrical systems, and heating/ventilation equipment. Replaces 45-foot boom lift purchased in 2006. Fleet Replacement. An assessment of age, mileage, hours of operation, and maintenance costs support the replacement of three electric carts and replacement of a 10-yard dump truck bed. Diesel Generator, 80 KW. Provides portable emergency power for wastewater treatment facilities and Glenwood Pump Station. Replacement of 23 year old generator. Inductively Coupled Plasma Spectrometer. Replacement of 12 year old spectrometer in the main laboratory. Security Camera System. Supports video monitoring of Biosolids Management Facility and Biocycle Farm operations and site activities. Replaces and updates 12 year old equipment. Computer File Server. Scheduled replacement of one network file server. ATTACHMENT 1 Page 6 of 23 Metropolitan Wastewater Management Commission Capital Improvement Program Major Rehabilitation Program-Budget The FY 16-17 Capital Programs budget includes $534,000 for Major Rehabilitation projects that are identified on the table below. Major Rehabilitation FY 16-17 Project Description Budget Air Drying Bed Resurfacing(2 beds) 180,000 Solids Pretreatment Building Roof 95,000 Plant Fuel Tank Replacement 85,000 Air Drying Beds Crack/fog Sealing(11 beds) 64,000 Maintenance Building High Bay Air Handlers 60,000 Operations/Maintenance Building 50,000 Total $534,000 Air Drying Bed Resurfacing. The biosolids drying process takes place on 13 asphalt drying beds over a 25 acre area. The beds have been on a rotational schedule for resurfacing to extend their useful life. In FY 16-17 two beds will be resurfaced. Solids Pretreatment Building Roof Replacement. Replacement of 20 year old built-up roofing. Inspection findings of blistering and seams separation indicate need for replacement. Plant Fuel Tank Replacement. Decommissions 32 year old underground fuel tanks and replaces with above ground tank system. Air Drying Beds Crack/Fog Sealing (11 beds). Provides protective seal to surface of asphalt drying beds to help maximize useful life. Maintenance Building High Bay Air Handlers. Replaces original 33 year old air handlers for heating and ventilation that have reached the end of their useful life. Operations/Maintenance Building Improvements. This expenditure will go towards miscellaneous improvements, repairs, and renovations to improve the functionality and usefulness of existing buildings. ATTACHMENT 1 Page 7 of 23 Metropolitan Wastewater Management Commission Capital Improvement Program Maior Capital Outlay-Budget The FY 16-17 Capital Programs budget includes $5,670,000 for the Major Capital Outlay items identified on the table below. Major Capital Outlay FY 16-17 Project Description Budget Engine Generator Replacement 5,300,000 Residuals Aerator Tractor Replacement 370,000 Total $5,670,000 Engine Genrator. The existing 800 KW engine generator provides about 55% of plant electric power needs and heating water for sludge digestion, building heat, and hot water. This project will replace the existing equipment with greater generation capacity of up to 1.2 megawatts, and replace related electrical and control systems that have reached the end of their useful life. As of January 2016, the project is currently in the design phase. The FY 15-16 budget included $2.9 million for the project. The FY 16-17 budget includes an additional $3.2 million for a project total of$6.1 million. Residuals Aerator Tractor Replacement. Replaces the original 16 year old paddle mixer which is used for daily mixing/turning of biosolids windrows in air drying beds. Asset Management Capital Budget Summary The following table summarizes the FY 16-17 Asset Management Capital Program Budget by project type. Asset Management Capital Project Budget Summary FY 16-17 Capital Project Type Budget Equipment Replacement 381,000 Major Rehabilitation 534,000 Major Capital Outlay 5,670,000 Total $6,585,000 5-Year Capital Plan (Exhibit 13) For each fiscal planning cycle, only the first year of budget authority is appropriated. The remaining four years of the CiP and AMCP Capital Plans are important and useful for fiscal and work planning purposes. However, it is important to note that the funds in the outer years of the Capital Plan are only planned and not appropriated. Also, the full amount of obligated multi-year project costs is often appropriated in the first year of the project, unless a smaller subset of the ATTACHMENT 1 Page 8 of 23 Metropolitan Wastewater Management Commission Capital Improvement Program project, such as project design, can be identified and funded without budgeting the full estimated project cost. For these multi-year contracts, unspent funds from the first fiscal year will typically be carried over to the next fiscal year until the project is completed. Accordingly, the RWP Capital Plan presented herein is a subsequent extension of the plan presented in the adopted FY 15-16 Budget that has been carried forward by one year. However, changes to the plan typically occur from year to year as more information becomes available. In addition to these yearly adjustments, RWP staff were further informed by a Partial Facilites Plan Update that was completed in June of 2014. Those changes were reflected in the MWMC FY 15-16 budget and continue forward in the FY 16-17 for the 5-Year Capital Plan. Exhibit 13 displays the MWMC 5-Year Capital Plan programs budget, which includes $79,742,600 in planned capital projects and $12,540,600 planned asset management capital projects for an overall 5-Year Capital Plan Budget of$92,283,200. EXHIBIT 13 Regional wastewater 5-Year Capital Programs FV 16-17 FY 17-18 FV 18-19 FV 19-2U I FV 20-21 TOTAL CAPITAL PROJECTS Biosolids Management Poplar Harvest Management Services 772,000 868,000 304,000 4,000 4,000 1,952,000 Non-Process Facilities and Facilities Planning Facility Plan Engineering Services 99,600 70,000 70,000 70,000 70,000 379,600 Capaciuy M mt Operations Maint(CMOM) 30,000 30,000 Com rehensive Facility Plan 713,000 742,000 1,455,000 Conveyance Systems Glenwood Punip Station 926,000 926,000 Plant Performance Improvements Increase Digestion Capacity 14,720,000 14,720,000 Operations&Maintenance Building Improvements 13,970,000 13,970,000 wPCF Lagoon Removal/Deco=issiomng 390,000 4,300,000 4,690,000 Thermal Load Mitigation:Pre-Implementation 244,000 148,000 392,000 Thermal Load Mitigation:Implementation 1 I�) 131,000 324,000 4,838,000 4,796,000 2,739,000 12,828,000 Thermal Load Mitigation:Implementation 2 1,500,000 3,500,000 4,000,000 9,000,000 Aeration Basin Improvements-Phase 2 4,050,000 11,850,000 15,900,000 Tertiary Filtration-Phase 2 3,500,000 3,500,000 TOTAL CAPITAL PROJECTS $30,356,600 $6,423,000 58,384,000 $12,424,000 $22,163,000 $79,742,600 ASSET MANAGEMENT E ui ment Replacement 381,000 972,000 588,000 617,000 648,000 3,206,000 Major Rehab 534,000 813,300 763,500 607,000 566,800 3,284,600 Major Capital Outlay(Z) 5,670,000 380,000 6,050,000 TOTAL ASSET MANAGEMENT $6,585,000 $1,785,300 $1,731,500 $1,224,000 $1,214,800 $12,540,600 TOTAL CAPITAL IMPROVEMENTS $36,941,600 $8,208,300 $10,111,500 1 $13,644,000 $23,377,800 $92,283,200 Notc: (1)Thermal Load Mitigation:Implementation 1 budges hicludes MIltRace Sponsorship($200,000)and Cedar Creek Sponsorship(S250,000). (2)FYI(,[7 include;$5.3 million for Bioga;Cogeneration which is a multi-year project,a detail ehcctis located at the end fthis document. ATTACHMENT 1 Page 9 of 23 Metropolitan Wastewater Management Commission Capital Improvement Program POPLAR MANAGEMENT SERVICES A �r 1 5° '�•... . Description: The Biocycle Farm comprises nearly 400 acres of hybrid poplar trees,which were planted as three management units(MUs). The MUs were initially planted in 2004, 2007, and 2009 and are managed on regulated 12-year rotations.This project develops a harvest management plan for the Biocycle Farm through market collaboration and refinement of poplar harvest and planting practices. The project ensures the timely harvest of the initial plantings in each MU within the regulatory 12-year rotation limit and subsequent replanting. Status: 18%completed. MU-1, comprising 156 acres,was fully harvested in 2013-2015. MU-1 will be replanted in FY 15-16 with replanting activities extending into FY 16-17. MU-2 was partially harvested in FY 15-16 for test marketing of veneer. Complete harvest of MU-2 will resume in FY 16-17. Justification: Land use regulatory requirement for operation of the Biocycle Farm. Project Driver: Land Use Compatibility Statement(LUCS)issued by Lane County. Project Trigger: Oregon ORS/OAR and NRCS rules dictating that exclusive farm use lands and farmed wetland status agricultural lands requiring agriculturally managed hybrid poplar plantations must be limited to 12-year rotation duration. Project Type: 100% Performance Improvement SDC Eligibility: 0% Estimated Project Cost: $2,346,000 for harvest and administration of the initial plantings across all three MUs. Estimated Cash Flow: FY 13-14 =$116,009; FY 14-15=$114,465; FY 15-16=$163,526; FY 16-17=$772,000; FY 17-18 =$868,000; FY 18-19=$304,000; FY 19-20=$4,000; FY 20-21 =4,000 2015-16 Expenditure/Cateoorv: Prior Years Est.Act. 2016-17 2017-18 2018-19 2019-20 2020-21 Total Design/Construction $230,474 $163,526 $772,000 $868,000 $304,000 $4,000 $4,000 $2,346,000 Other $0 $0 $0 $0 $0 $0 $0 $0 Total Cost $230,474 $163,526 $772,000 $868,000 $304,000 $4,000 $4,000 $2,346,000 ATTATCHMENT 1 Page 10 of 23 Metropolitan Wastewater Management Commission Capital Improvement Program FACILITY PLAN ENGINEERING SERVICES ° I � r �4t u ��k� d a l t� rtr Description: Engineering services for analysis, project definition, cost estimating, and general consultation regarding the 20-Year Facilities Plan. Status: This year,work continued on assessment of biogas utilization alternatives,which used a Triple Bottom Line(TBL)approach to inform staff recommendations. Based on TBL results, regional program staff recommended implementation of a project to expand the WPCF's combined heat and power(CHP)production capacity from 0.8 to 1.2 megawatts. This would allow the plant to more fully utilize the biogas for power and heat production and minimize biogas flaring. However, due to recent changes in Eugene Water and Electric Board's (EWEB's)proposed power pricing structure,the project was halted while regional program staff revises the economic assessment of the CHP expansion project. Moving forward, staff anticipates additional need for Facilities Plan Engineering Services to support ongoing upgrades and infrastructure needs at MWMC facilities. Justification: Projects were developed to varying levels of specificity in the 20-Year Facilities Plan and there is an on-going need for ongoing technical and engineering resources to help in further refining projects and generally assisting with implementation of the plan.Another need addressed by this resource is assurance that the new improvements maintain the overall integrity of the plant in terms of treatment processes and hydraulics. This task also provides ongoing planning work related to items not addressed by the 2004 MWMC Facilities Plan. Project Driver: Ongoing goal to efficiently follow and accommodate the upgrades resulting from the 20- Year Facilities Plan. Project Trigger: On-going need. Estimated Project Cost: $933,639 Estimated Cash Flow: FY 06-07 =$50,000; FY 07-08=$50,044; FY 08-09=$25,467; FY 09-10 =$31,829; FY 10-11 =$69,419; FY 11-12=$8,699; FY 12-13=$36,690; FY 13-14=$146,491; FY 14-15 =$67,453; FY 15-16=$67,947; FY 16-17=$99,600; FY 17-18=$70,000; FY 18-19 =$70,000; FY 19-20=$70,000; FY 20-21 =$70,000 2015-16 Expenditure/Category: Prior Years Est.Act. 2016-17 2017-18 2018-19 2019-20 2020-21 Total Design/Construction $0 $0 $0 $0 $0 $0 $0 $0 Other $486,092 $67,947 $99,600 $70,000 $70,000 $70,000 $70,000 $933,639 Total Cost $486,092 $67,947 $99,600 $70,000 $705000 $70,000 $70,000 $933,639 ATTACHMENT 1 Page 11 of 23 Metropolitan Wastewater Management Commission Capital Improvement Program CAPACITY MANAGEMENT, OPERATIONS, AND MAINTENANCE (CMOM) Plonning Operodions0ointenonte hfoniuving&Assessment 4 Description: This project(formerly identified as the WWFMP Update project)supports and guides ongoing collection system capacity management, operations and maintenance(CMOM) programs to address Rainfall Derived Inflow and Infiltration (RDII)and sanitary sewer overflows(SSOs).The MWMC's NPDES permit requires wet weather planning and prohibits SSOs. DEQ's SSO Enforcement Internal Management Directive identifies CMOM as an acceptable programmatic approach to help ensure compliance. The MWMC's CMOM program provides staff resources and engineering consultant services to support the implementation of CMOM programs owned and operated by the two partner cities within the MWMC's service area (i.e., Eugene and Springfield).The effort funded through this project provides or supports workshop organization and facilitation, guidance development and documentation,technical analysis, standards establishment, and CMOM gap analysis assistance. Status: Last year, both partner cities completed CMOM program implementation plans building on the gap analyses they performed in the prior year. Summaries of these plans were presented to the MWMC on August 14, 2015. In addition, regional program staff hired a consultant to perform a study of private lateral program approaches. A goal of this study was to recommend steps that partner agencies could follow to develop private lateral programs to reduce the amount of RDII entering the collection system. A summary of study findings was presented to the MWMC on March 13, 2015. Finally, regional program staff organized a workshop attended by staff from the two partner cities and representatives from three Oregon wastewater agencies who have implemented successful private lateral programs.The goal of the workshop was to share information on private lateral programs between the agencies. A debriefing meeting was held shortly after the workshop to discuss and identify potential next steps for each partner city. Going forward, regional wastewater program staff will continue to facilitate further discussion and potential implementation of private lateral programs. Project Driver: Meet new NPDES requirements concerning SSOs,wet weather planning, and RDII reduction through a CMOM program approach. Project Trigger: Address NPDES Permit requirements related to SSOs and RDII. Improvement SDC Eligibility: 11% Estimated Project Cost: $500,604 Estimated Cash Flow: FY 05-06=$6,028; FY 06-07=$86,895; FY 07-08=$42,589; FY 08-09=$9,562 FY 09-10=$14,724; FY 10-11 =$7,538; FY 11-12=$26,909; FY 12-13=$123,251; FY 13-14=$91,671; FY 14-15=$28,379; FY 15-16=$33,058; FY 16-17=30,000 2015-16 Expenditure/Category: Prior Years Est.Act. 2016-17 2017-18 2018-19 2019-20 2020-21 Total Design/Construction $0 $0 $0 $0 $0 $0 $0 $0 Other $437,546 $33,058 $30,000 $0 $0 $0 $0 $500,604 Total Cost $437,546 $33,058 $30,000 $0 $0 $0 $0 $500,604 ATTACHMENT Page 12 of 23 Metropolitan Wastewater Management Commission Capital Improvement Program COMPREHENSIVE FACILITIES PLAN UPDATE NO.1 17 T7- � e 1Ar elf" �- - Description: This will be the first MWMC Comprehensive Facilities Plan Update since the 2004 MWMC Facilities Plan.This Comprehensive Facilities Plan Update effort will consider a 20-year planning horizon and will draw on the most recent plant data, current regulatory landscape, and available technology in order to ensure the MWMC continues to meet future regulations, environmental standards, and customer needs. Status: Planned for future implementation. Justification: Plan future conveyance and treatment upgrades and/or expansions to meet regulatory requirements, preserve public health and regional water quality standards. Project Driver: Provides comprehensive facilities planning to develop the capital program for the upcoming 20-year period once the MWMC receives new regulatory requirements under the next NPDES permit renewal. Project Trigger: Planning cycle initiated under the 2004 Facilities Plan and later modified to match evolving NPDES permit renewal schedule, now estimated for 2017 at the earliest. Project Type: Facilities Plan Improvement SDC Eligibility: 21% Estimated Project Cost: $1,457,280 Estimated Cash Flow: FY 14-15 =$2,280; FY 17-18=$713,000; FY 18-19=$742,000 2015-16 Expenditure/Category: Prior Years Est.Act. 2016-17 2017-18 2018-19 2019-20 2020-21 Total Design/Construction $0 $0 $0 $0 $0 $0 $0 $0 Other $2,280 $0 $0 $713,000 $742,000 $0 $0 $1,457,280 Total Cost $2,280 $0 $0 $713,000 $742,000 $0 $0 $1,457,280 ATTACHMENT 1 Page 13 of 23 Metropolitan Wastewater Management Commission Capital Improvement Program GLENWOOD PUMP STATION UPGRADE I = r I Description: Expand Glenwood pump station capacity. The existing pump station is built to be expandable in capacity when the need arises.Two pumps are installed with the expandability to add up to two additional pumps when needed. Status: The project is anticipated to start design development in 2018 with consultant services. The scope of work is planned to add one wastewater pumping system. Justification: Additional pumping capacity will be required at this MW MC pump station to handle increasing flows in the Glenwood area (Springfield)and the Laurel Hill area (Eugene). Project Driver: Keep up with capacity needs, maintain required pumping redundancy, and prevent overflows upstream of the Glenwood pump station. Project Trigger: Planning work in 2014 anticipates that a third pump to increase capacity should be operational by about year 2019.The timing will be impacted by the rate and type of development in the area and efforts to minimize infiltration and inflow that impact the Glenwood pump station. The MW MC Partial Facilities Plan Update document dated June 2014 recommended moving the initial budget year to FY 2018-19 as shown below. Project Type: 100%Capacity Improvement SDC Eligibility: 38% Estimated Project Cost: $926,000(funding for administration, design, permits, construction, etc.) Estimated Cash Flow: FY 18-19=$864,000; FY 19-20 =$62,000 2015-16 Expenditure/Category: Prior Years Est.Act. 2016-17 2017-18 2018-19 2019-20 2020-21 Total Design/Construction $0 $0 $0 $0 $926,000 $0 $0 $926,000 Other $0 $0 $0 $0 $0 $0 $0 $0 Total Cost $0 $0 $0 $0 $926,000 $0 $0 $9265000 ATTACHMENT 1 Page 14 of 23 Metropolitan Wastewater Management Commission Capital Improvement Program INCREASE DIGESTION CAPACITY I Description: Installation of a fourth digester for expanded production of Class B biosolids. This project also included supporting the plant-wide landscaping construction work that was completed in December of 2012. Status: As of January 29, 2016,the project to Increase Digestion Capacity is in the design phase for a fourth digester and construction should start in fall of 2016.The MWMC has three existing digesters. Justification: Continue to meet the requirements for Class B digestion with the ability to take one digester out of service for cleaning and/or repairs. Project Driver: Addresses the need for anaerobic digestion capacity.The 2004 MWMC Facilities Plan considers an option to upgrade the existing digestion process to meet Class A biosolids standards as a strategy to secure a wider range of beneficial end-use options and increase program flexibility. Since that time, the MWMC has effectively expanded beneficial application of Class B biosolids with expansion of the Biocycle Poplar Farm, and through working with private sector end-users. Project Trigger: Estimates indicate that expanded digestion facilities will be needed by 2017 or 2018. The design phase started in 2015. Improvement SDC Eligibility: 54.3% Estimated Project Cost: $16,653,170 (funding for administration, design, permits,construction, etc.) Estimated Cash Flow: FY 11-12=$139,028; FY 12-13=$44,142; FY 13-14=$0; FY 14-15 =$312,932 FY 15-16=$1,437,068; FY 16-17=$7,050,000; FY 17-18=$7,600,000; FY 18-19=$70,000 2015-16 Expenditure/Category: Prior Years Est.Act. 2016-17 2017-18 2018-19 2019-20 2020-21 Total Design/Construction $496,102 $1,437,068 $14,720,000 $0 $0 $0 $0 $16,653,170 Other $0 $0 $0 $0 $0 $0 $0 $0 Total Cost $496,102 $1,437,068 $14,720,000 $0 $0 $0 $0 $16,653,170 ATTACHMENT 1 Page 15 of 23 Metropolitan Wastewater Management Commission Capital Improvement Program OPERATIONS & MAINTENANCE BUILDING IMPROVEMENTS e � -w qh - Operations Building Maintenance Building Maintenance Building ISC Modular Building Aerial Description: This project will update and expand the Operations and Maintenance(O&M)support facilities at the Water Pollution Control Facility(WPCF).The support facilities to be updated and expanded on include the Maintenance Building, Administrative/Operations Building,and the temporary Industrial Source Control (ISC)building. The improvements will include a new laboratory building located where the temporary ISC building is currently. Status: As of December 29, 2015: The project team with direction from the Architectural Consultant created three alternatives with cost estimates to consider based on information gathered during the pre-design (architectural programming)phase. Staff received Commission approval to move forward with the design of Alternative#2 which include modifications and additions to the Maintenance and Administration/Operations Buildings and design a new building for laboratory functions. The project is in the design phase, and construction bidding is anticipated in summer or fall of 2016. Justification: The original design for the O&M Buildings at the WPCF was completed in the late 1970s. Since that time, use of the O&M Buildings have changed substantially due to modifications in the workforce, advancing technology, regulatory changes, and an increase in staff to support additional facilities Building codes, have also changed during this time, necessitating upgrades. Lastly,the ISC modular building was installed as a temporary structure in 1996 and has since reached the end of its useful life. Project Driver: The need to update and/or replace the existing O&M support facilities is driven by the need to provide a safe and efficient work environment for WPCF staff. Many of these changes stem from a changing wastewater/environmental business since the MWMC original construction that occurred in the early 1980's. Project Trigger: As needed, due to expansion and changes related to the MWMC facilities and safety. Estimated Project Cost: $14,900,000 Improvement SDC Eligibility: To be determined Estimated Cash Flow: FY 14-15 =$180,833; FY 15-16 =$749,167; FY 16-17 =$4,400,000; FY 17-18=$6,500,000; FY 18-19=$3,070,000(estimated cash flow related to administration, design, permits, construction, etc.) 2015-16 Expenditure/Category: Prior Years Est.Act. 2016-17 2017-18 2018-19 2019-20 2020-21 Total Design/Construction $180,833 $749,167 $13,970,000 $0 $0 $0 $0 $14,900,000 Other $0 $0 $0 $0 $0 $0 $0 $0 Total Cost $180,833 $749,167 $13,970,000 $0 $0 $0 $0 $14,900,000 ATTACHMENT 1 Page 16 of 23 Metropolitan Wastewater Management Commission Capital Improvement Program WPCF ONSITE LAGOON = IL - _ r Description: This project decommissions the existing biosolids lagoon at the Water Pollution Control Facility(WPCF). Status: As of January 13, 2016: The project is in pre-design phase and cost estimations are preliminary. The MWMC hired a consultant in December of 2014 to create a bid package to decommission the lagoon. Lagoon decommissioning site work is anticipated in 2018 but the schedule might change based on progress of the construction of the forth digester improvements. Justification: The lagoon was constructed in 1979 as a temporary biosolids storage facility while the Biosolids Management Facility was under construction. Since that time it has also served as a temporary storage lagoon to support digester cleaning operations. However,the lagoon no longer serves the purpose for which it was originally constructed and does not meet current design standards for wastewater lagoons. Project Driver: The lagoon can no longer provide the biosolids capacity for which it was intended nor cost effectively continue to support digester cleaning operations.The lagoon is almost full of accumulated rainwater and residual solids. Therefore,the decision was made to decommission the lagoon and change the process of cleaning the digesters. Project Trigger: The WPCF lagoon no longer functions as originally designed. Estimated Project Cost: $5,000,000 (funding for administration,design, permits,construction, etc.) Improvement SDC Eligibility: Not applicable Estimated Cash Flow: FY 13-14 =$1,769; FY 14-15=$128,550; FY 15-16=$179,681; FY 16-17=$33,000; FY 17-18=$542,000; FY 18-19 =$4,115,000 2015-16 Expenditure/Category: Prior Years Est.Act. 2016-17 2017-18 2018-19 2019-20 2020-21 Total Design/Construction $130,319 $179,691 $390,000 $4,300,000 $0 $0 $0 $5,000,000 Other $0 $0 $0 $0 $0 $0 $0 $0 Total Cost $130,319 $179,681 $390,000 $4,300,000 $0 $0 $0 $5,000,000 ATTACHMENT 1 Page 17 of 23 Metropolitan Wastewater Management Commission Capital Improvement Program THERMAL LOAD MITIGATION PRE-IMPLEMENTATION Description: This project includes the study and planning of thermal load mitigation measures including recycled water feasibility studies, riparian shading projects, and water quality trading credit development, as well as associated permit negotiation and legal strategy related to the temperature total maximum daily loads (TMDL)and NPDES permit renewal. Status: Two of three planned phases of thermal load strategy planning have been completed with recommendations to develop opportunities for recycled water demonstration projects and partnerships in watershed restoration for temperature credits. The third phase of study commenced in FY 15-16 and will continue in FY 16-17. Justification: Provides planning of infrastructure, projects, and collaborative agreements needed so that thermal loads are reduced on the Willamette River while providing additional environmental and community benefits. Project Driver: Address NPDES permit thermal load compliance related to Willamette River TMDL temperature requirements. Project Trigger: Planning necessary for ongoing compliance with Oregon's temperature standard. Project Type: 100% Performance Improvement SDC Eligibility: 26% Estimated Project Cost: $818,595 Estimated Cash Flow: FY 13-14 =$295,995; FY 14-15 =$48,908; FY 15-16 =$81,692; FY 16-17 =$244,000; FY-17-18 =$148,000 2015-16 Expenditure/Category: Prior Years Est.Act. 2016-17 2017-18 2018-19 2019-20 2020-21 Total Design/Construction $0 $0 $0 $0 $0 $0 $0 $0 Other $344,903 $81,692 $244,000 $148,000 $0 $0 $0 $818,595 Total Cost $344,903 $81,692 $244,000 $148,000 $0 $0 $0 $818,595 ATTACHMENT 1 Page 18 of 23 Metropolitan Wastewater Management Commission Capital Improvement Program THERMAL LOAD MITIGATION— IMPLEMENTATION 1 - �,� Description: This project implements thermal load mitigation projects strategized for regulatory compliance and additional environmental and community benefits.The projects may include recycled water use expansion at MWMC facilities and/or extension of recycled water services to community partners,water quality trading credit strategies through shade credit investments, and collaborative partnerships for permit compliance. The recycled water projects may include additional treatment, disinfection, pumping, pipeline, and distribution/irrigation systems. Status: Pilot-scale riparian shade projects are currently being implemented under a 25-year contract agreement with The Freshwater Trust.Additional project opportunities are being evaluated for future implementation under the Thermal Load Mitigation: Pre- Implementation Project. Justification: Meet future thermal load permit limits and improve water quality. Implementation of the thermal load compliance strategy developed under pre-implementation planning phase. Project Driver: Address NPDES permit thermal load compliance related to Willamette River total maximum daily loads(TMDL)temperature requirements. Project Trigger: Project implementation necessary for ongoing compliance with Oregon's temperature standard. Project Type: 100% Performance Improvement SDC Eligibility: 26% Estimated Project Cost: $13,165,470 Estimated Cash Flow: FY 13-14 =$78,925; FY 14-15=$87,116; FY 15-16=$171,429; FY 16-17=$131,000; FY 17-18 =$324,000; FY 18-19=$4,838,000; FY 19-20=$4,796,000; FY 20-21 =$2,739,000 2015-16 Expenditure/Category: Prior Years Est.Act. 2016-17 2017-18 2018-19 2019-20 2020-21 Total Design/Construction $166,041 $171,429 $131,000 $324,000 $4,838,000 $4,796,000 $2,739,000 $13,165,470 Other $0 $0 $0 $0 $0 $0 $0 $0 Total Cost $166,041 $171,429 $131,000 $324,000 $4,838,000 $4,796,000 $2,739,000 $13,165,470 ATTACHMENT 1 Page 19 of 23 Metropolitan Wastewater Management Commission Capital Improvement Program THERMAL LOAD MITIGATION— IMPLEMENTATION 2 r � � Description: This project anticipates future expansion of recycled water uses, riparian restoration, and/or other thermal load and watershed management strategies for regulatory compliance and environmental and community benefits. These projects are subject to the outcomes of the regulatory scenarios and goals associated with changing conditions of total maximum daily loads(TMDL)implementation, community and climatic factors, and emerging water quality/quantity needs. Status: To be planned. Justification: Ongoing fulfillment of thermal load mitigation strategic plans. Project Driver: Address NPDES permit thermal load compliance related to Willamette River TMDL temperature requirements, other emerging water quality regulatory drivers, and community needs. Project Trigger: Compliance with NPDES discharge permit. Project Type: 100% Performance Improvement SDC Eligibility: 26% Estimated Project Cost: $9,000,000 (plus up to$8,000,000 anticipated project need in the out-years FY 21-22 and beyond for a total project cost of$17,000,000). Estimated Cash Flow: FY 18-19 =$1,500,000; FY 19-20=$3,500,000; FY 20-21 =$4,000,000 2015-16 Expenditure/Category: Prior Years Est.Act. 2016-17 2017-18 2018-19 2019-20 2020-21 Total Design/Construction $0 $0 $0 $0 $1,500,000 $3,500,000 $4,000,000 $9,000,000 Other $0 $0 $0 $0 $0 $0 $0 $0 Total Cost $0 $0 $0 $0 $1,500,000 $3,500,000 $4,000,000 $9,000,000 ATTACHMENT 1 Page 20 of 23 Metropolitan Wastewater Management Commission Capital Improvement Program AERATION BASIN IMPROVEMENTS— PHASE 2 ow i -X' W- Description: Aeration Basin (Phase 2): Add step feed, anoxic selectors, and fine bubble diffusers to 4 of the 8 cells of the aeration basins and make hydraulic improvements. This project was originally the North Aeration Basin Improvements project; however the Phase 1 study/design phase showed that improvements to the four eastern most basins as a first phase would allow for better hydraulics and more operational flexibility. In January 2016,the project scope and cost(estimate$750K) increased to include replacement of existing aeration basin gates,valves and spray system. Status: The Aeration Basin (Phase 2)project is anticipated to start design development in fiscal year 2019-20 with consultant services. Justification: Increase the dry weather aeration basin treatment capacity with respect to ammonia (with nitrification)and increase the wet weather treatment capacity. Project Driver: National Pollution Discharge Elimination System (NPDES)permit includes ammonia limit requiring nitrification in dry weather and expansion of wet weather capacity to treat wet weather flows to meet NPDES permit monthly and weekly suspended solids limits. Project Trigger: Address water quality requirements (need to evaluate the requirements based on the MWMC next NPDES permit renewal that is not anticipated to be issued in 2016). Project Type: 50% Capacity; 50% Performance Improvement SDC Eligibility: 58.7% Estimated Project Cost: $15,900,000 (funding for administration, design, permits,construction, etc.) Estimated Cash Flow: FY 19-20 =$1,450,000; FY 20-21 =$6,800,000; FY 21-22=$6,950,000; FY 22-23 =$700,000 2015-16 Expenditure/Category: Prior Years Est.Act. 2016-17 2017-18 2018-19 2019-20 2020-21 Total Design/Construction $0 $0 $0 $0 $0 $4,050,000 $11,850,000 $15,900,000 Other $0 $0 $0 $0 $0 $0 $0 $0 Total Cost $0 $0 $0 $0 $0 $4,050,000 $11,850,000 $15,900,000 ATTACHMENT 1 Page 21 of 23 Metropolitan Wastewater Management Commission Capital Improvement Program TERTIARY FILTRATION - PHASE 2 Description: The phased work program will install infrastructure/support facilities for 30 mgd of filters for tertiary filtration of secondary treated effluent. Phase 2 is planned to install filter system technology sufficient for another 10 mgd of treatment that will increase the total filtration capacity to 20 mgd. The Phase 3 project will install the remaining filtration technology to meet the capacity needs identified in the 2004 MWMC Facilities Plan. In January 2016,the project scope and cost(estimate$530K)increased to include updating electrical switchgear, and install tertiary filter flushing headers/pipe vents. Status: Tertiary Filtration (Phase 2)project is anticipated to start design development in fiscal year 20-21. The MWMC has an existing equipment agreement(ending October 2017)to allow for additional filtration equipment at a defined price. Justification: The 2004 MWMC Facilities Plan proposes phasing filters on a phased work program. Filtration provides high quality secondary effluent to help meet permit requirements and potential Class A recycled water. Project Driver: Performance reliability to meet the dry weather NPDES total suspended solids limits of less than 10 mg/L, reuse development, and compliance with effluent limits during peak flow conditions. Project Trigger: NPDES permit compliance for total suspended solids (TSS): Dry weather maximum month flow in excess of 49 mgd.Also, provide higher quality effluent so that reuse options can be developed. Improvement SDC Eligibility: 41.6% Estimated Project Cost: $14,030,000(funding for administration, design, permits, construction, etc.) Estimated Cash Flow: FY 20-21 =$1,600,000; FY 21-22=$5,800,000; FY 22-23=$6,630,000 2015-16 Expenditure/Category: Prior Years Est.Act. 2016-17 2017-18 2018-19 2019-20 2020-21 Total Design/Construction $0 $0 $0 $0 $0 $0 $3,500,000 $3,500,000 Other $0 $0 $0 $0 $0 $0 $0 $0 Total Cost $0 $0 $0 $0 $0 $0 $3,500,000 $3,500,000 ATTACHMENT 1 Page 22 of 23 Metropolitan Wastewater Management Commission Capital Improvement Program BIOGAS COGENERATION SYSTEM REPLACEMENT ilk_ lifer• �`I f = -. MS t r e i i Description: Increase capacity of the combined heat and power generation system (also known as a cogeneration system), located at the Water Pollution Control Facility(WPCF),to maximize biogas utilization. Status: As of January 20, 2016, design of a larger capacity cogeneration system is 50%complete. Further design efforts are paused until definitive long-term financial determinations can be made. Justification: This project will beneficially utilize nearly 100%of generated biogas,opposed to currently flaring approximately 30%. Project Driver: Maximize the beneficial use of biogas,following the recommendation of the Biogas Utilization Study. Project Trigger: Existing cogen unit is scheduled to need a major rebuild by March 2017. Project Type: 100% Performance Improvement SDC Eligibility: Not applicable Estimated Project Cost: $6,100,000 (funding for administration,design, permits, construction, etc.) Estimated Cash Flow: FY 15-16=$800,000; FY 16-17=$3,200,000; FY 17-18=$2,100,000 2015-16 Expenditure/Category: Prior Years Est.Act. 2016-17 2017-18 2018-19 2019-20 2020-21 Total Design/Construction $0 $800,0000 $5,300,000 $0 $0 $0 $0 $6,100,000 Other $0 $0 $0 $0 $0 $0 $0 $0 Total Cost $0 $800,000 $5,300,000 $0 $0 $0 $0 $6,100,000 ATTACHMENT 1 Page 23 of 23 AGENDA ITEM VIII. Metropolitan Wastewater Management Commission SPRINGFIELD OREGON partners in wastewater management MEMORANDUM DATE: February 5, 2016 TO: Metropolitan Wastewater Management Commission (MWMC) Amber Fossen, Communications Coordinator FROM: Matt Stouder, MWMC General Manager SUBJECT: The MWMC Video Series ACTION REQUESTED: Information Only ISSUE The Metropolitan Wastewater Management Commission (MWMC) has developed a series of videos that focus on the wastewater treatment process, pollution prevention, and sustainable practices. These videos target the community MWMC serves, and raise awareness about the MWMC while also promoting everyday actions people can take to help keep local waterways healthy. Staff plans to show the videos at the February 12, 2016 Commission meeting. BACKGROUND The video series is responsive to key findings from the FY 2015 Community Survey that found awareness of the MWMC is low even though all of the services the MWMC provides were rated as important. The survey found: 84 percent of respondents felt protecting air and water quality was important to extremely important Only 18 percent of ratepayers can identify MWMC The video series also aligns with the 2015 MWMC Communications Plan's objectives, strategies, and messaging. This effort aims to raise awareness about the MWMC through informational videos that showcase what the MWMC does to help keep local waterways, including the Willamette River, healthy. DISCUSSION In the fall of 2015, the MWMC contracted with Jake Wehrman of Jake Wehrman Video Production to produce three videos focused on wastewater treatment processes, pollution prevention, and sustainable practices. The MWMC communications team will Memo: The MWMC Video Series February 5, 2016 Page 2 of 2 make these videos available through a variety of communication channels including (but not limited to): • The MWMC website • The MWMC Vimeo site (to be established) • E-newsletter feature(s) • Annual Report • Sharing with regional partners and school districts • Emails from the MWMC Commission • Utility bill insert • Presentations (community, industry, etc.) • Clean Water University curriculum, and as a curriculum resource to teachers of grades 4-12 • Pollution Prevention campaigns • Media kits • Social media ads (to explore) • Encourage staff/leaders to share on social media and with personal contacts The following lists primary audiences for this effort. However, additional audiences will be communicated with as identified/needed to help increase awareness of the MWMC. • Students • Parents • Teachers/school districts in the MWMC service area • Eugene/Springfield residents (customers) • Elected leaders (Eugene & Springfield city councils, Lane County Board of Commissioners) • Water industry peers (including EWEB, SUB, ACWA) ACTION REQUESTED No action requested. Information only.