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Water Tank Maintenance Contract

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Water Tank Maintenance Contract CITY COMMISSION AGENDA MEMO February 1, 2021 FROM: Ben Kearns, Public Works Management Assistant Randy DeWitt, P. E., Assistant Director of Public Works MEETING: February 16, 2021 SUBJECT: Award Contract for the Water Storage Tank Asset Management Program (WA2016, CIP WA201P) PRESENTER: Robert K. Ott, P. E., Director of Public Works BACKGROUND The City of Manhattan currently owns and operates six (6) active above-ground water storage tanks within the water distribution system that provides a combined capacity of 5.7 million gallons . This includes the following tanks: Bluemont Tank, Sunset Avenue (Cemetery) Tank, Sunset Zoo Tower, Miller Ranch Tower, Northwest (Colbert Hills) Tower and CiCo (Londondery) Tank. The storage provided by these tanks ensures water pressure and fire flow protection throughout the City’s distribution system per the Kansas Department of Health and Environment (KDHE) and the American Water Works Association (AWWA) standards. In addition, the City owns and maintains a historic water structure, Landmark Tower, which has been removed from service. On July 10, 2010, the City entered into a 10-year maintenance agreement with Utility Service, Inc., of Perry, Georgia (Utility Services). This agreement was amended on September 28, 2011, and March 4, 2014, to include the Backwash Tank located at the Water Treatment Plant (WTP). The maintenance agreement included annual visual inspections for each City tank or tower, washout inspection every three (3) years, and an interior and exterior renovation every ten (10) years. The agreement also required the contractor to maintain the tanks and towers in full compliance with minimum performance standards, including making all necessary miscellaneous structural and other maintenance repairs. Utility Services annual fee to maintain all of the City’s water storage tanks was $127,829. This agreement with Utility Services expired July 31, 2020. Prior to this maintenance agreement, the City scheduled each tower for complete renovation painting every ten (10) years. The City did not conduct regular inspection or collect data to prioritize tanks for painting to maintain them per AWWA guidelines. This maintenance method allowed tank coatings to deteriorate to the point where re-coating was more expensive due to accumulations of rust and corrosion, extensive blasting, prime coats, and steel repairs. Further, the City was not in compliance with AWWA guidelines, which state that all tanks should be inspected every three (3) years. Finally, the City was constrained by the low bid process, often having to hire a contractor to paint tanks that did not provide sufficient painting services. Annual costs were typically budgeted at $300,000 per the City’s Capital Improvement Project (CIP) program. On July 21, 2020, the City Commission authorized City staff to advertise a Request for Qualifications (RFQ) process for water storage tank management services for the next 10- year period from firms with extensive experience in providing these services. In general, the firm would provide all engineering and inspection services specific to the maintenance of the seven (7) existing water storage tanks, including the WTP Backwash Tank. The City also sought recommendations for inspection and maintenance for the Landmark Tower and the two (2) finished water clearwells (in ground storage tanks) at the WTP. Detailed services within the agreement include an initial assessment of each tank, regular inspections, repairs, perpetual maintenance, rehabilitation, washout, preventative maintenance, proactive asset management and painting services. All coating systems are to be included as well. The firm shall warranty all work throughout the duration of the agreement. Ideally, all tanks must receive visual inspections annually, washout inspections every 3-4 years and a complete interior and exterior renovation at an interval to be determined based on the determination of the selected firms initial tank assessment. DISCUSSION City Administration assembled a Selection Committee comprised of City staff from the Public Works and City Manager’s Office. A total of four (4) proposals were received and reviewed. The Selection Committee did not conduct interviews. On October 6, 2020, the City Commission accepted the Selection Committee’s recommendation to select Suez Advanced Solutions (Suez), of Atlanta, Georgia, for the Water Storage Tank Asset Management Program. Suez is the parent company for Utility Services. The recommendation is due in large part to Suez’s experience in maintaining similar structures for other municipalities and their prior performance for the City of Manhattan. On January 20, 2021, Suez presented seven (7) individual site agreements (see enclosed), for the Water Storage Tank Asset Management Program. These agreements will provide for the inspection, maintenance, and rehabilitation of each storage site from 2021 through 2031. Upon completion of the original agreements, Suez has also provided an option for an automatic year to year renewal. Suez prefers to have separate agreements for each asset instead of the originally requested one (1) all-encompassing agreement to allow flexibility to remove tanks (if necessary) or add tanks in the future. City staff is in concurrence with this. The scope of services provided is similar to the prior agreement between the City and Suez, with one major difference: Suez will provide a full warranty on all work for the entire 10-year period of the agreement. The primary services provided with the Agreements are as follows: • Annually inspect and service the tank to ensure the structure is in a sound, watertight condition, meeting all state and federal guidelines. • Every third year, the tank will be drained and thoroughly cleaned. The interior be thoroughly inspected and disinfected prior to returning the tank to service. • Suez will furnish engineering and inspection services needed to conduct maintenance and repairs. • The tanks will be cleaned and repainted, both interior and exterior, at such time as complete repainting is required. This will include the cost of design for new logo templates. • Suez will provide emergency services to perform all repairs covered under the agreement, including graffiti removal. The total expenditure for the 2021-2031Water Storage Tank Asset Management Program is $2,028,710, with annual payments of $202,871. If the renewal option is exercised by the City in 2031, the cost per site will be slightly less than the original agreement. The initial reduction in price is due to the previous ten (10) years maintenance. Commencing in 2032, if the City opts to continue the agreement, the costs would include annual increases of up to 5 percent from the previous year’s expense. See table below: Annual Costs Location 2021-2030 2031 2032 2033 2034 2035 Backwash $9,956 $9,697 $10,040 $10,396 $10,764 $11,145 Bluemont $17,600 $21,205 $21,956 $22,733 $23,538 $24,371 CiCo $51,403 $39,716 $41,122 $42,578 $44,085 $45,646 NW/Colbert Hills $27,700 $22,980 $23,793 $24,635 $25,508 $26,411 Miller Ranch $28,234 $22,980 $23,793 $24,636 $25,508 $26,411 Sunset Avenue $24,207 $29,165 $30,198 $31,267 $32,373 $33,520 Sunset Zoo $43,771 $35,324 $36,574 $37,869 $39,209 $40,597 Total Annual Cost $202,871 $181,067 $187,476 $194,115 $200,985 $208,101 The Landmark Tower, which is not in active service and is designated as a historic site/park, has not been included in this agreement due to its lower priority. Suez estimates that it will require approximately $100,000 in future maintenance to ensure that corrosion will not significantly reduce the structural integrity. Recommended maintenance includes several safety upgrades, foundation repairs, exterior painting, and interior sandblasting and painting. Public Works Administration feels that the cost of this maintenance should not be paid for solely with the proposed agreement to maintain active tanks. A separate CIP project will be established and supplemental funds outside of the Water Fund should (i.e., grants) be sought to support its maintenance. This could also be bid out to local contractors to potentially save on expenses. Additionally, the inspection and maintenance of the WTP clearwells were not included in this agreement. The frequency of maintenance on these clearwells is less and the anticipated expenses are lower and can be completed through the annual WTP maintenance budget. FINANCING Funding for this project has been programmed within the City’s CIP, with the annual contract payments budgeted from the Water Fund. The approved CIP budget included an annual amount of $150,000. The proposed annual expenses with these agreements is $202,871. Public Works Administration has reviewed the funds and determined that there is adequate funds available in the Water Fund budget for the increased annual amount. ALTERNATIVES It appears the Commission has the following alternatives concerning the matter at hand. The Commission may: 1. Authorize City Administration to finalize and the Mayor and City Clerk to execute a Water Tank Maintenance Contract for each individual water tank with Suez Advanced Solutions, of Atlanta, Georgia, in the total amount of $2,028,710 for the Water Storage Tank Asset Management Program (WA2016, CIP WA201P), with annual payments totaling $202,871. 2. Do not authorize execution of the contracts. 3. Modify to meet the needs of the Commission. 4. Table the item. RECOMMENDATION City Administration recommends the City Commission authorize City Administration to finalize and the Mayor and City Clerk to execute a Water Tank Maintenance Contract for each individual water tank with Suez Advanced Solutions, of Atlanta, Georgia, in the amount of $2,028,710 for the Water Storage Tank Asset Management Program (WA2016, CIP WA201P), with annual payments totaling $202,871. POSSIBLE MOTION Authorize City Administration to finalize and the Mayor and City Clerk to execute a Water Tank Maintenance Contract for each individual water tank with Suez Advanced Solutions, of Atlanta, Georgia, in the amount of $2,028,710 for the Water Storage Tank Asset Management Program (WA2016, CIP WA201P), with annual payments totaling $202,871.
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