GREAT MIAMI WASTEWATER SYSTEM PUBLIC/PRIVATE PARTNERSHIP OPPORTUNITY WITH RUMPKE

Transcription

1 GREAT MIAMI WASTEWATER SYSTEM PUBLIC/PRIVATE PARTNERSHIP OPPORTUNITY WITH RUMPKE WHITE PAPER September 2012 CH2MHILL, INC. CONSIDERS THE DATA AND INFORMATION CONTAINED IN THIS REPORT TO BE PROPRIETARY. WHILE EFFORTS HAVE BEEN MADE TO ENSURE THAT THE INFORMATION AND DATA USED IN THE REPORT ARE ACCURATE, THE REPORT MAKES NO REPRESENTATIONS, EITHER EXPRESSED OR IMPLIED, IN RELATION TO THE ACCURACY OR COMPLETENESS OF THE DATA AND INFORMATION FOUND IN IT. THIS REPORT AND ANY INFORMATION CONTAINED HEREIN SHALL NOT BE DISCLOSED OUTSIDE THE METROPOLITAN SEWER DISTRICT OF GREATER CINCINNATI AND SHALL NOT BE DUPLICATED, USED OR DISCLOSED IN WHOLE OR IN PART FOR ANY PURPOSE.

2 1. Purpose The purpose of this white paper is to support a capital project to investigate the potential of a public-private partnership between MSDGC, Rumpke, and potentially Butler County to develop the Great Miami Wastewater System (GMWS), formerly known as the Kemper- Colerain & Indian Creek Wastewater System. 2. Project Background As described in the May 2009 Report, Kemper-Colerain & Indian Creek Wastewater Management Plan, and further updated in a September 2011 white paper, Great Miami Wastewater System Procurement and Financing Strategy Development, the recommended infrastructure for the GMWS included: Construction of a new 4 MGD Biological Nutrient Removal wastewater treatment facility with tertiary filtration and sludge minimization technology. Continued operation of the Pleasant Run East Pump Station Elimination of the Pleasant Run Central Pump Station and Force Main Construction of a new Pleasant Run West Pump Station Construction of a gravity sewer to transfer flow to the new treatment facility A map of the potential GMWS service area from the May 2009 Report is shown in Figure 1. Although proposed to be owned and operated by MSDGC, the new wastewater system could treat flows from drainage areas currently serviced by both MSDGC and the Butler County Water and Sewer Department. This project has been on hold for most of 2012 due to funding issues. In August of 2012, MSDGC was approached by Rumpke Consolidated Companies, Inc., owners and operators of the largest landfill in Hamilton County, about the possibility of directing treated leachate into the GMWS. This potential new, large customer provides an opportunity for a public-private as well as inter-jurisdictional partnership in the development of the GMWS. 1

3 FIGURE 1 Potential GMWS Service Area 2

4 3. Project Benefits to Stakeholders As documented in the previously mentioned reports, the GMWS would provide significant benefits to Hamilton County and Butler County (if included in the GMWS). These benefits include both economic and environmental incentives, such as enhancing economic development, elimination of failing infrastructure, reducing flows in the Mill Creek basin, and improving water quality by eliminating a significant number of failing home sewage treatment systems (HSTS) with a centralized regional treatment facility. To address and manage the landfill leachate challenge within the GMWS, Rumpke seeks longterm predictability and stability for leachate disposal costs and the desire to remain out of the leachate/wastewater treatment business. Developing a Public/Private Partnership PPP with Rumpke would provide MSDGC with the following benefits: Opportunity to construct facilities using a blend of private and public capital funding across multiple jurisdictions Value in having future capacity at the GMWS WWTP for public use if/when Rumpke leachate strength and flow declines Value in having future capacity at the Regional Leachate Facility for public use if/when Rumpke leachate strength and flow declines Reduction in WWIP funding requirements in the Mill Creek Sewer shed (>$22M 1 already identified) along with elimination of hauled leachate to the Mill Creek WWTP. Figure 2 provides a map showing the locations of identified WWIP projects and their offset costs within the Mill Creek basin if the GMWS is built. Realization of additional cost savings from eliminating the need to rehabilitate the Pleasant Run Central Force Main. This cost savings is currently undetermined. Opportunity to consolidate wastewater infrastructure through the elimination of the Mayflower Estates WWTP and Greenridge-Fifth Pump Station in the future with installation of sewer to serve Rumpke landfill. Opportunity to service areas with chronic failing HSTS Therefore, the accelerated development of the GMWS and the yet to be determined equitable sharing of costs could benefit all three major stakeholders. 1 In 2006 Dollars 3

5 FIGURE 2 WWIP Project Offsets and Costs 4

6 4. Regional Leachate Facility Alternates In discussions with Rumpke s consultant, two potential alternatives have been developed for the pretreatment of landfill leachate. The two alternatives reflect variations in leachate quality which lead to significant costs differences for Rumpke pretreatment facilities. Table 1 summarizes the details of the two alternatives. TABLE 1 Rumpke Regional Leachate Facility Alternatives Leachate Quality Assumption Alternative 1 Combined High & Low Strength Leachate Worst case reactive zone leachate quality Alternative 2 Combined Low Strength Leachate Lower strength reactive zone leachate quality Facility Flow Capacity, gpd 354, ,000 Facility Treatment Capacity, ppd of BOD 51,000 7,500 Rumpke Flow and Load Contributions to GMWWTP after pretreatment 8% of Flow 69% of BOD 72% of TKN 6% of TSS 8% of Flow 11% of BOD 6% of TKN 7% of TSS GMWS WWTP O&M Costs Surcharge to Rumpke No surcharge 5. Capital Costs for the GMWS Figure 3 presents the GMWS infrastructure with a regional leachate facility proposed to serve the Rumpke landfill. As shown in Figure 3, various segments of the GMWS infrastructure are proposed to be cost-shared differently depending on which stakeholder is contributing flow and load to that infrastructure segment. Figure 3 delineates which segments are proposed to be the responsibility of Rumpke, MSDGC, Butler County, shared MSDGC-Rumpke, and shared MSDGC-Rumpke-Butler County. Figure 3 also provides a preliminary example of the value to MSDGC for the cost sharing options presented below. Based on the sharing of assets in Figure 3, and the various flows and loads contributed by the three major stakeholders, Table 2 presents a preliminary example for potential cost sharing arrangements for the two alternatives as well as the original base condition of the GMWS described in the previous reports without flow contribution from the Rumpke landfill. 5

7 FIGURE 3 Potential Capital Cost Sharing Arrangements by GMWS Infrastructure 6

8 TABLE 2 Potential Capital Costs Sharing by Stakeholder for Shared GMWS Assets Base Condition No Rumpke Participation Alternative 1 51,000 ppd Rumpke Pretreatment Facility Alternative 2 7,500 ppd Rumpke Pretreatment Facility MSDGC Share $124.5M $113.8M $113.8M Rumpke Share $0 $99.7M $54.0M Butler County Share $9.3M $9.3M $9.3M Total GMWS System Cost $133.8M $222.8M $177.0M Potential MSDGC Capital Cost Savings from Base Condition N/A $10.7M $10.7M Note: These cost estimates prepared are considered Class 4 - Planning Level estimates as defined by the American Association of Cost Engineering (AACE) and as designated in ASTM E Estimates are considered accurate to +50% to -30% based up to a 15% complete project definition. Costs are in 2012 dollars. As shown in Table 2, the estimated capital costs for the GMWS increase substantially to manage flows from the Rumpke landfill. However, off-setting costs, estimated at $11 million, can be realized by partnering with Rumpke on this project. Furthermore, the PPP with Rumpke may allow MSDGC to accelerate the project, saving capital costs slated for wet weather overflow reduction within the Mill Creek basin as part of the WWIP. 6. Next Steps Recent studies have identified a number of significant reasons to pursue the development of a regional wastewater management system in northwestern Hamilton County. The economic climate over the past few years has adversely impacted the incentive to move this project forward. The addition of a potential private partner, in conjunction with the further need to address failing septic systems, could provide sufficient impetus to advance this project. As demonstrated in this white paper, the inclusion of 354,000 gallons per day of Rumpke landfill leachate will substantially increase the cost of the GMWS infrastructure. However, based on preliminary evaluation of alternatives included herein, cost sharing with Rumpke could lead to a potential cost-offset to MSDGC of approximately $11 million compared to the original base case in which Rumpke did not participate. This $11 million off-set is in addition to the more than $22 million of WWIP projects that would be saved if the GMWS is constructed. There would be additional savings associated with the rehabilitation of the Pleasant Run force main, whose costs have not yet been determined. Based on the outcome of this preliminary investigation, it is in MSDGC s interest to support a capital project to investigate and pursue a PPP with Rumpke as part of the development of the GMWS. 7