FEATURES FOR SUCCESS DESIGN-BUILD- OPERATE WASTEWATER PROJECTS
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1 FEATURES FOR SUCCESS DESIGN-BUILD- OPERATE WASTEWATER PROJECTS Linda Hanifin Bonner, Ph.D., WDBC Mark Halleman, P.E., Parsons Produced by the Water Design-Build Council 1
2 Key Factors Design-Build-Operate Methods U.S. DBO Wastewater Projects Project Priorities Successful Attributes Lessons Learned Key Steps for Success
3 DBB Design-Build Risk Transferred Design-Build-Operate Design-Build Finance O&M Design-Build-Operate Transfer Build Own Operate Transfer Terminology available options Private Sector Participation
4 Defining Design Build-Operate Single contract with Owner/agent for project design construction, operations and management Selection is typically a two-step process: qualifications followed by a competitive technical and price proposals with fixed-price/best value selection DBO firm responsible for overall project performance and if desired, can assign risk to other parties DBO firm integrate risks among all parties for the design-construction-operation of project
5 Typical U.S. DBO Projects Water and Wastewater new (greenfield) projects and plant expansions / refurbishments Treatment process upgrades Storage and supply Residuals/Biosolids management Energy efficiency
6 DBO for Water and Wastewater Treatment Plants Particularly suited for treatment plant projects That want to use new or emerging technology That have limited staff resources That want to transfer risk to a third party Who need to have efficient delivery method for both the project and O&M
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9 DBO Delivery Methods Integrated-Entity Owner/agent contracts with single firm or team (joint venture) to design, construct, operate & maintain wastewater plant DB firm takes lead, presents team members in RFP and allocates risk Operations-Led Entity Owner/agent has contract with Operations, who then contracts with company to perform design engineering & construction Operations firm allocates risks accordingly
10
11 CA DBO WASTEWATER PROJECT 7.5 mgd plant Pacific Ocean coast Project Priorities Accelerated schedule/time constraints (gov. consent order) Public health protection Construction in a sensitive ecological Experience with multi-government and military regulations Flexibility to accommodate innovative technology Contract/Procurement Method Qualifications submittal - experience Proposal with preliminary designs, detailed project approach and pricing
12 CA DBO WASTEWATER PROJECT 7.5 mgd plant Pacific Ocean coast Successful Attributes Unique collaborative partnership with owner/agent & DBO firm Enhanced operations and reliability of system with new recycling systems Project completed 6 weeks ahead of schedule Lessons Learned Team collaborations/communications facilitated meeting owner priorities, protecting sensitive ecology, and working with multi-government agencies
13 FL- DBO WASTEWATER PROJECT Atlantic Ocean discharge Project priorities water quality issues - failing septic systems Comply with government regulations Schedule integration with other organizations Transportation/traffic; environmental/wetlands and protected trees Fixed-Price contract defined conditions and requirements
14 FL DBO WASTEWATER PROJECT Atlantic Ocean discharge Successful Attributes DBO team experience & qualifications Ability to bring needed resources to meet design schedule Lessons Learned Inclusive team from project execution to operations Open honest and frequent communications Dedicated project team focused on project success
15 WA DBO WWT PROJECT - Pacific Ocean Discharge Project Priorities Aligning design/construction to minimize cost Ensure operations staff input Schedule Innovative technologies Incorporating life-cycle costs Assigning risk to best party Contract/Procurement Method 2-step RFQ/RFP Progressive Design-Build One company performing all roles
16 WA DBO WWT PROJECT - Pacific Ocean Discharge Successful Attributes Support services with overall process Well integrated DBO teams (all services) Effective management and leadership Lessons Learned Owner & staff understand how DBO functions Partnering and building trust among teams Dedicated staff, managers, executive leadership Open communication during in contracting phase Clear understanding of expectations (realistic)
17 DBO Delivery Methods Integrated-Entity Owner/agent contracts with single firm that to design, construct, operate & maintain wastewater plant DB Firm selects team members Operations-Led Entity Owner/agent contract with Operations firm, responsible for contracting with DB company to perform design engineering & construction allocating risk
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19 WA DBO WW PROJECT- 8 mgd Reclamation Facility Project Priorities Water quality protection - growth Regulatory compliance phosphorous reduction Contract: Two step RFQ/RFP procurement process Fixed-Price for design-build services Annual O&M service fee
20 WA DBO WW PROJECT- 8 mgd Reclamation Facility Successful Attributes Transparent problem solving approach Owner and DBO firm alliance developed alternate O&M strategies and techniques to minimize issues Lessons Learned Early consideration of technical innovation of treatment processes Being prepared for an early completion
21 TX DBO Ultra-filtration WTP and Water Supply Priorities Most efficient life cycle cost- limited ability to increase rates Use of Innovative technology Schedule: new water supply needed quickly for population growth Contract/Procurement Method One step Qualifications based Negotiated fixed-price- owner had an maximum limit on affordability
22 TX DBO Ultra-filtration WTP and Water Supply Performance Guarantees Water delivery/quality and quality Price and Schedule Guarantees Consumable efficiency chemicals Power Renewal and replacement of membranes Liquidated damages Performance incentives/penalties
23 TX Bexar Met DBO Ultra-filtration WTP and Water Supply Successful Attributes Single point responsibility for: Capex- $30M - O&M - Renewal and replacement Innovative technology resulted in reduced cost Reduced design/construction period (16-Month) Successful trackrecord: 15-year award winning operating record Lessons Learned -Collaborative owner / DBO relationship owner's priorities achieved
24 CONCLUSIONS: Success starts with Development Clearly defined project priorities Clearly define project scope Schedule Costs Risk Allocation Realistic Expectations Experienced advisors
25 CONCLUSIONS: Clearly Defined Project Priorities What Owners/Agents state they want Project completed on schedule Maintain budget -- less risk of change orders and claims (best value) Achieve reliable operating performance and service Ability to integrate innovative treatment process/technology Have a warranty contract performance Comply with new (emerging) regulations Financial stability predictable and optimal operations & maintenance cost (life cycle) Sometimes specific technology
26 Conclusions: Transparent Communications Clearly defined criteria to select DBO firm or team Request examples of successful DBO Projects Lessons learned Project expectations contract necessities
27 CONCLUSIONS: Important Procurement/Contract Steps Hold review/comment session with proposing firms Present project priorities, schedule, work scope, desired treatment processes Provide draft contract, terms and conditions for design-build and operations & maintenance Offer compensation for new ideas
28 CONCLUSIONS: Important Procurement/Contract Steps Reduce the unknowns that are best managed by the owner and the the private sector will add risk premium, as example: Completed geotechnical, environmental, and cultural reports on project site Reports on pilot testing of new technologies or studies of projects Identify where utilities and other facilities need permit and government approvals Prescriptive or performance-based approach
29 CONCLUSIONS: Important Procurement/Contract Steps Assure that operation contract specifications are complete, accurate and reliable Emissions Odors - Noise Timeframe of repairs/replacement Energy consumption Condition of facility at end of contract operating period Open Communications among all parties Discussions/allocation of risk
30
31 Education Provided by the Water Design-Build Council Trade organization of national (and international) designbuild companies that serve the water and wastewater industry Advocates for the added value and applications of collaborative Design-Build, Design-Build Operate and CMAR delivery Define and develop DB and CMAR best practices for owner planning, procurement and project implementation Promote collaborative relationships between owners and industry practitioners to create innovative and quality solutions -- saving time and cost, with less risk for all parties
32 Mission EDUCATION -- facilitate an understanding of Design-Build (DB) and Operate delivery methods and Construction Management-at-Risk (CMAR) for water and wastewater infrastructure projects Presentation excerpted from the Municipal Water and Wastewater Handbook, produced by the Water Design- Build Council (3 rd Edition 2013) Handbook is available for at no cost, and can be downloaded at or contacting the WDBC office. Training Workshops available at no cost.
33 WDBC Member Companies
34 The Municipal Water and Wastewater Design-Build Handbook (3 rd Ed. 2013) Fact sheets, website and industry articles Monthly E-News on member projects and industry issues Website Market Size Study (Analysis of the Water Design-Build Council s member-firm projects) Owner Satisfaction Survey (2008) Update 2012 Impediments to Using Design-Build (Survey Findings 2013) Comparative Evaluation of Design-Build Versus Design-Bid-Build (2009) AWWA book titled Design-Build for Water and Wastewater Projects (developed by AWWA in conjunction with WDBC, WEF and DBIA in 2011) 2013 Products: Procurement Guide for Progressive Design Build Educational Video Series Additional WDBC Resources
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