FPUD approves $690k oversight contract for $22 million project

The Fallbrook Public Utility District board heard an update on funding for the rehabilitation of FPUD’s wastewater treatment plant while also awarding a construction oversight contract for the treatment plant upgrades.

A 4-0 vote Aug. 27, with Archie McPhee abstaining, approved a construction management services contract with Arcadis for an amount not to exceed $690,500 while amending FPUD’s design services contract with Black & Veatch.

“A project this size, you need someone out there full-time overseeing the contractor,” said FPUD engineering and planning manager Jack Bebee. “On something of this size the issues have become more complex.”

The construction is expected to take approximately 2 1/2 years. The final design is expected to be complete by December 2012, and in the absence of delays in finalizing a loan from the State Water Resources Control Board construction is expected to begin in February 2013.

“We have a preliminary funding commitment from the state and we still have a few steps to finalize, but the funding looks like it should be secured fairly soon,” Bebee said. “That could be the thing that delays it, getting everything lined up with the state.”

FPUD would obtain a State Revolving Fund loan of $22,154,148 which would be paid back over a 20-year period at an interest rate of one-half the general obligation bond rate obtained by the State Treasurer’s office. FPUD is currently expecting that to translate into an interest rate of 2.5 percent. The first payment would be due one year after construction is completed.

FPUD had previously approved a contract with Black & Veatch for the design of the project to improve the treatment plant’s reliability and compliance with regulatory agencies. When Black & Veatch responded to the initial request for proposals that firm included an estimate for design services during construction which would cover review of submittals and contract questions related to design intent. FPUD opted not to award that portion of the contract until it was certain that the design would be completed on time and that the construction funding would be secured.

The design phase is now 75 percent complete. FPUD worked with Black & Veatch to reduce the amount of construction administration services by providing in-house resources to reduce the submittals Black & Veatch will review. The amendments also incorporate some additional design features which were required due to the condition of facilities which will require additional structural upgrades and to the need to add a dechlorination facility in order to comply with the National Pollutant Discharge Elimination System permit issued to FPUD by the San Diego Regional Water Quality Control Board on Aug. 8.

The additions to the Black & Veatch contract led to an authorization of up to $667,260 of additional expenditures. The State Revolving Fund loan will cover the cost of that consultant work.

Arcadis was one of three respondents to FPUD’s request for proposals for construction oversight. Representatives from the three companies were interviewed by Bebee, FPUD general manager Brian Brady, and treatment plant chief operator David Deen. All three FPUD staff members gave Arcadis the highest rating of the three firms.

Although Arcadis’ standard rate is $215 per hour, FPUD staff was able to reduce the hourly rate to $175 due to the lack of construction management work. Arcadis also agreed to a billing overhead rate of 2.33 rather than their actual overhead rate of 2.7. The $690,500 contract amount will also be covered by the State Revolving Fund loan.

FPUD staff will prepare a pre-qualification process to ensure that bidders for the actual treatment plant construction are qualified for the size and scope of the project.