MWRA BOARD OF DIRECTORS’ MEETING
May 23, 2001
Report of the Chair
No report.
Report of the Executive Director
No report.
Retirement System Funding for FY02
The Board voted to approve funding of $2,438,145 as MWRA's FY02 contribution to the retirement system based on the May 14, 2001 request from the Retirement Board. The Proposed Current Expense Budget includes $2,949,000 for MWRA's FY02 contribution to the retirement system. The revised amount of $2,438,245 is a decrease of $510,855.
Assignment of Agreements from Stone & Webster, Inc. to Stone & Webster Massachusetts, Inc.: Contracts 5033, 5284, 5313 and Purchase Orders 1002839-000 and 1004141-000
The Board voted to authorize the Executive Director, on behalf of the Authority, to approve the assignment of the following five contracts from Stone & Webster, Inc. with the Shaw Group, Inc. as Guarantor, to Stone & Webster Massachusetts, Inc. with the Shaw Group, Inc. as Guarantor, with no increase in contract cost or term:
1. Contract 5053, Spot Pond Station Assessment and Remediation;
2. Contract 5284, Construction Management and Resident Inspection Services for MetroWest Water Supply Tunnel;
3. Contract 5313, Braintree-Weymouth Tunnel and Intermediate Pump Station Design/ESDC;
4. Purchase Order 1002839-000, InfoSTAR Application Time and Materials Consultation Services;
5. Purchase Order 1004141-000, InfoSTAR Application Technical Maintenance Services, Technical Consultation Requests Initiated by Telephone.
The purpose of this assignment is a corporate name change. Last spring the Shaw Group purchased Stone & Webster, Inc. out of bankruptcy proceedings and is in the process of changing its name to Stone & Webster Massachusetts, Inc. while remaining as Guarantor.
Updated Regional I/I Reduction Plan
The Board voted to approve the Updated Regional Infiltration/Inflow (I/I) Reduction Plan (Plan) and authorize staff to do the following: submit the Plan to the Environmental Protection Agency (EPA) and the Department of Environmental Protection (DEP) by June 30, 2001, as required under MWRA's National Pollutant Discharge Effluent System permit; negotiate with DEP on an Interagency Agreement concerning regional I/I reduction and sanitary sewer overflow (SSO) issues; and report back to the Board on progress concerning these regulations.
The proposed Plan combines recommendations from the recent I/I Task Force Report with existing MWRA I/I reduction initiatives. Under the Plan, MWRA and member communities will have full legal and fiscal responsibility for implementation of operation, maintenance and I/I reduction programs for the MWRA-owned interceptor system and community-owned sewers, respectively.
DEP requested that staff bring the Plan before the Board prior to returning to the agency to negotiate. The Plan includes the following five major goals for MWRA:
1. Continue current operation and maintenance program for the MWRA-owned interceptor system leading to the identification, prioritization and rehabilitation of structural and I/I problems.
2. Work with member communities, DEP and EPA to eliminate sewer system backups into homes and other buildings and to minimize health and environmental impacts of SSOs, related to I/I.
3. Work with member communities, DEP and EPA to reduce I/I in the regional collection system, with emphasis on inflow reduction in tributary areas and private sources and infiltration that may impact groundwater or surface water.
4. Work with member communities, DEP and EPA to expand existing efforts to educate and involve the public regarding regional sewer backup, SSO and I/I reduction issues.
5. Provide technical support to member communities, DEP and EPA on local operation and maintenance and capital improvement programs.
Staff anticipates that DEP will request MWRA implement and/or fund additional I/I reduction activities over those recommended within the Plan. Mr. Jacques asked staff whether negotiations with DEP are leading to a Memorandum of Agreement (MOA) with the agency. Staff responded that a MOA is likely; however, the Board will be updated prior to this occurring. Staff informed the Board that DEP would prefer MWRA be the "I/I enforcer" to avoid directly confronting communities on violations.
Emergency Water Connection to Stoughton
The Board voted to authorize the Executive Director, on behalf of the Authority, to execute a six-month Emergency Water Supply Agreement with the Town of Stoughton. Staff informed the Board that at its town meeting on May 22, 2001, Stoughton voted overwhelmingly in favor of joining the MWRA system. Just seven years ago the Town resoundingly rejected this option. Staff believes the Town's most recent vote is a tribute to MWRA and the change of perception that Stoughton has toward the Authority. Additionally, the Town of Canton agreed to a $1.8 million mitigation payment from Stoughton for the latter to build its MWRA water connection through the former. Several steps are to follow before the project begins, including the Legislature inserting "Stoughton" into the language of the MWRA Enabling Act.
Mr. Jacques asked staff whether Canton and Stoughton will be authorized to allow other municipalities to connect to the Towns' MWRA water connection, since the Authority will not own the actual connecting pipe. Staff stated that non-MWRA communities cannot "tap in"; however, Stoughton and Canton can negotiate between themselves if either Town needs a connection for a development. Staff also reminded the Board that, per the System Expansion Policy developed by the MWRA Advisory Board, the System Expansion Committee will reconvene this fall.
Extension of Contract Employee, Law Division
The Board voted to approve a six-month extension of the employment contract of Virginia S. Renick as counsel to the Law Division from June 1, 2001 to November 20, 2001, at an hourly rate of $60 and a not-to-exceed limit of $24,000.
Renewal of Insurance Program: XL
The Board voted to approve an Authority insurance program, with the following components and costs, and to authorize the Executive Director, on behalf of the Authority, to execute the required documents as listed below:
1. Renewal of the existing policy (issues by XL in 1998) providing coverage for Automobile Liability, General Liability, and Property loss exposures, with a combined retention of $2.5 million per occurrence and coverage for the period of July 1, 2001 through June 30, 2002. This renewal option has a three-year premium cost of $1,710,000.
2. Excess Workers' Compensation Policy not to exceed $90,000 for coverage in effect from July 2, 2001 through June 30, 2002.
3. Public Officials and Employees Bond with Kemper at a cost not to exceed $8,000 for coverage in effect from July 1, 2001 through June 30, 2002.
4. Treasurer's Bond with Kemper at a cost of $1,599 for coverage in effect from July 1, 2001 through June 30, 2002.
5. Amendment 1 to Contract F109 with March, Inc. to provide insurer broker services in connection with the above coverages. Amendment 1 extends the term of the Agreement by three years, from July 1, 2001 through June 30, 2004 and increases the maximum amount of compensation by an amount not to exceed $300,000 to $540,000.
West Roxbury Tunnel - Repairs to Sections 138 and 137: R. Zoppo Corp., Contract 6569
The Board voted to approve the award of Contract 6569, West Roxbury Tunnel - Repairs to Sections 138 and 137, to the lowest responsive bidder, R. Zoppo Corp. The Board further voted to authorize the Executive Director, on behalf of the Authority, to execute and deliver said Contract in the bid amount of $6,138,450 with a contract term of 350 days from the Notice to Proceed. Contract 6569 will address areas of the VFW Parkway in West Roxbury, which runs along the Charles River into a residential area that hits deep rock. MWRA is paying for the temporary relocation of impacted area residents, the cost of which is included in this contract.
The FY01 - 03 CIP includes a budget of $2,168,000 for Contract 6569, resulting in a $3,970,450 budget deficit. The cost differential is due to the fact that the contract was budgeted on a conceptual cost estimate, whereas the engineer's estimate was based on the final design developed after the FY01 - 03 CIP was approved. Staff states in its summary that if this amount causes the CIP budget to exceed the ten-year spending cap or the cap for any of the first three years, reductions will be taken elsewhere to offset the increase.
Evaluation of Ozone and Ultra Violet Light Disinfection Treatment: American Water Works Association Research Foundation (AWWARF), Contract 6815
The Board voted to authorize the Executive Director, on behalf of the Authority, to enter into an agreement with the American Water Works Association Research Foundation on the "Tailored Collaboration Project: Evaluation of Ozone and Ultra Violet Light", Contract 6815, for an amount not to exceed $300,000 plus "in-kind services" in an amount not exceed $95,000 for a term of thirty-two months.
Staff stated that in recent years, ultra violet light (UV) has become a very popular method of water treatment. MWRA is continuing to evaluate technologies and evolving regulations relating to drinking water treatment and public health. Although UV is not being evaluated as a replacement to MWRA's current water treatment of ozonation/chloramination at the Walnut Hill Water Treatment Plant, UV could prove to be a supplement to address evolving EPA water treatment regulations.
The total cost of this project is $891,000. MWRA is responsible for $395,000 of this amount in cash and in-kind services. The remainder is funded by other utilities around the country and by the AWWARF. The FY01 - 03 CIP does not include funding for this contract. However, staff states in its summary that if this amount causes the CIP budget to exceed the ten-year spending cap or the cap for any of the first three years, reductions will be taken elsewhere to offset the increase.
CONTRACT AMENDMENTS/CHANGE ORDERS
Chelsea Branch Sewer Relief Project: Modern Continental, Contract 6263, Change Order 7
The Board voted to authorize the Executive Director, on behalf of the Authority, to approve Change Order 7 to increase the amount of Contract 6263 with Modern Continental Construction Co., Inc., Chelsea Branch Sewer Relief Project, in the amount of $61,294.65. The Board further voted to authorize the Executive Director to approve additional change orders as may be needed to Contract 6263 in amounts not to exceed the aggregate of $250,000.
Change Order 7 increases the cumulative change order total to $3,143,135.12, added to the original contract amount of $15,377,445, for a revised contract total of $18,520,580.12. The FY 01 - 03 CIP includes $15,377,000 for Contract 6263, resulting in a $3,143,580.12 budget deficit. Staff states in its summary that if this amount causes the CIP budget to exceed the ten-year spending cap or the cap for any of the first three years, reductions will be taken elsewhere to offset the increase. Change orders now total more than 20% of the original contract price.
Although the Contractor has scheduled this project for substantial completion by June 28, 2001, staff anticipates more change orders to arise. Referring to the $250,000 authorized for the Executive Director to approve change orders under delegated authority, Mr. MacRitchie asked staff whether this amount would be sufficient to cover rising costs. Staff assured the Board that the delegated authority should suffice. Mr. Favaloro suggested that this may serve as a good example of a request for delegated authority that the Board should consider declining until further discussion occurs. Mr. Favaloro did not suggest that delegated authority should be stricken entirely; rather, perhaps the Board should withhold approvals on projects with high rates of change orders until further discussion with staff occurs. Explaining that because this project is nearing completion, the Board approved the request for delegated authority.
Boston Harbor Project Final Site Completion: Barletta Heavy Division, Inc., Contract 6201, Change Order 15
The Board voted to authorize the Executive Director, on behalf of the Authority, to approve Change Order 15 to increase the amount of Contract 6201 with Barletta Heavy Division, Inc., BHP Final Site Completion, in the amount of $106,453.68. The Board further voted to authorize the Executive Director to approve additional change orders as may be needed to Contract 6201, in an amount not to exceed the aggregate of $250,000. This change order is for the purpose of installing granite curbing, sidewalks, topcoat paving, mill (grind) work and sod for the Main Access Road to the Deer Island Treatment Plant.
Change Order 15 increases the cumulative change order total to $2,702,422.16, added to the original contract amount of $31,741,234, for a revised contract total of $34,443,656.16. The FY01 - 03 CIP includes a budget of $32,282,000 for Contract 6201, resulting in a $2,161,656.16 deficit. Staff states in its summary that if this amount causes the CIP budget to exceed the ten-year spending cap or the cap for any of the first three years, reductions will be taken elsewhere to offset the increase. More than $2.25 million of the $2.7 million in change orders were approved since February of this year. Change orders now total 8.5% of the original contract price.
Walnut Hill Water Treatment Plant - Construction Management Services: Earth Tech, Inc., Contract 6208, Amendment 1
The Board voted to authorize the Executive Director, on behalf of the Authority, to approve Amendment 1 to decrease the amount of Contract 6208 with Earth Tech, Inc., Walnut Hill Water Treatment Plant - Construction Management Services, in the amount of $382,310. Amendment 1 decreases the contract amount from $24,838,048 to $24,455,738.
Walnut Hill Water Treatment Plant - Cosgrove and Wachusett Intakes: J.F. White Contracting Company, Contract 6207, Change Order 8
The Board voted to authorize the Executive Director, on behalf of the Authority, to approve Change Order 8 to increase the amount of Contract 6207 with J.F. White Contracting Co., Walnut Hill Water Treatment Plant - Cosgrove and Wachusett Intakes, in the amount of $110,126. The Board further voted to authorize the Executive Director to approve additional change orders as may be needed to Contract 6207 in amounts not to exceed the aggregate of $250,000 and 180 calendar days. The purpose of this change order is to provide additional diving work to perform sluice gate inspection and cleaning at the Cosgrove and Wachusett intakes.
Change Order 8 increases the cumulative change order total to $1,201,489, added to the original contract amount of $10,930,100, for a revised contract total of $12,131,589. The FY01 - 03 CIP contains $11,500,000 for Contract 6207, resulting in a $631,589 deficit. Staff states in its summary that if this amount causes the CIP budget to exceed the ten-year spending cap or the cap for any of the first three years, reductions will be taken elsewhere to offset the increase.
Northern Extra High Pipeline Improvements, Sections 45, 63 and 83: D&C Construction, Contract 6340, Change Order 8
The Board voted to authorize the Executive Director, on behalf of the Authority, to approve Change Order 8 to extend the time for completion of Contract 6340 with D&C Construction Co., Inc., Northern Extra High Pipeline Improvements, Sections 45, 63 & 83, by 122 calendar days to September 29, 2001. The FY01 - 03 CIP includes $2,732,000 for this contract. Although Change Order 8 does not increase the amount of Contract 6340, the budget is currently exceeded by $387,929.34. Staff states in its summary that if this amount causes the CIP budget to exceed the ten-year spending cap or the cap for any of the first three years, reductions will be taken elsewhere to offset the increase.
Fore River Railroad Corporation Update
On March 14, 2001, the Fore River Railroad Corporation (FRRC) issued a Request for Qualifications and Proposals (RFQ/P) for a new operator of the railroad. The goal of this procurement was to maximize revenue while ensuring high quality, uninterrupted and safe freight rail services. On April 12, 2001, eleven firms submitted proposals to operate the railroad, five of which the Selection Committee deemed qualified and requested license fee proposals from. The license fee is structured in such a way that after a nominal fixed fee of $10,000 on the first $250,000 of gross revenue, bidders competed to offer the Fore River Railroad the highest percentage of revenue. Based on the proposals received, the Selection Committee chose Twin Rivers Technologies to operate the railroad, beginning on July 1, 2001.
Mr. Mannering expressed concern that Twin Rivers could underprice itself, thereby avoiding paying MWRA a percentage of its revenue. Staff responded that MWRA has built-in protection that this will not occur, as Twin Rivers is currently FRRC's largest customer and has a vested interest in ensuring that the railroad operates efficiently and generates revenue.
Risk Evaluation Panel and Project
During the spring of 2000, staff began developing a Risk Evaluation Project to understand how to best assess and respond to a wide variety of potential MWRA workplace, operating and systems risks. The guiding question for staff was whether MWRA is paying attention to the "right" risks. The project included seeking input from risk experts to form a review panel, feedback from MWRA staff and a project management framework to engage senior and middle managers throughout the Authority. The panel's review raised issues for staff to consider; however, it did not offer any emergency recommendations for MWRA to immediately address. The FY01 CEB includes $87,000 for this project, of which $76,000 has been spent to date.
Mr. Carroll asked staff to share the conclusion drawn from the project. Staff responded that a pilot comparative risk analysis will be undertaken over a four-month timeframe, beginning in the fall of 2001. The purpose of the pilot is to identify risks and prioritize a process around the following two areas: (1) risk assessment of failures and losses associated with catastrophic events in the water and wastewater infrastructure; and (2) failures and losses caused by staff turnover, which results in loss of institutional memory and knowledge. Consultant and /or trainer contracts may be needed once the in-house experience of completing the pilot assessment process is evaluated.
Mr. Jacques raised the issue of security and suggested that staff document various unusual occurrences that could compromise security as an alternative to surveillance cameras, which could implicate privacy issues. Staff responded that a comprehensive security plan will be formulated in the near future, following discussions with the Advisory Board and personnel throughout the Authority.
Update on Competitiveness Study
Over the past several weeks Black & Veatch (B&V), the Consultant for the Competitiveness Study, has collected data from comparable water and wastewater utilities throughout the country. B&V sent a survey to thirty-one utilities, twenty-one of which responded. B&V is currently analyzing the data and expects to issue recommendations by mid-June on MWRA staffing numbers. Mr. Carroll reminded the Board that the Competitiveness Study process began in October 2000 and questioned why B&V did not start collecting data at that point. Staff responded that pressuring utilities to complete the survey can cause them not to do so.
A group of experts from private and public water and wastewater firms and utilities will visit MWRA in early June. These experts will share their experiences in adopting competitiveness programs and, along with the Project Advisory Group (consisting of MWRA staff and union representatives), will comment on B&V's Draft Competitiveness Program for MWRA.
_______________________________________________________________________________________________
This summary does not include every item discussed by the Board, nor the full extent of the discussions. Please contact Nathalie Grady at the Advisory Board Office with questions, comments and requests for additional information.