On Wednesday this week, Grants Pass City Council approved a resolution on a vote of 7 to 0, with one abstention, authorizing City Manager Aaron Cubic to amend the current agreement with Slayden Construction Group, allowing Slayden to enter into an agreement with H2O Innovation as the selected Membrane System Supplier for the replacement Water Treatment Plant.
H2O Innovation provided a proposal with a higher initial capital cost but with a significantly greater long-term value to the City’s ratepayers and was therefore recommended as the successful bidder over two other proposers.
Specific items that make H2O Innovation’s proposal a better value:
Stainless steel piping as opposed to HDPE. Stainless steel provides a more durable product with less expansion and contraction, increasing the service life of the equipment it is attached to.
The proposal also includes 27% more membranes, allowing the plant to operate at lower flux rates, increasing the likelihood of long service life to the membranes. This will also offer the ability for the City to operate at the designed flux rates and produce a higher quantity of water for short periods of time.
H20 Innovation’s proposal also included an option to reduce the number of membrane racks, saving over $300,000 on the original proposal.
The cost of this Agreement is $7,170,214. Of this total, $517,000 is obligated without further Council authorization; the balance will only be paid with Council approval and only when the unit is released for manufacturing per the terms included in the agreement.
Replacing the WTP has been a priority of the City Council for a number of years. The use of a Design-Build Delivery model allows the project to move forward in a collaborative and cost-effective manner over several phases.
Due to the complexity of the Replacement Water Treatment Plant project, Phase 1 services were to be divided into a number of smaller steps.
Phase 1 services were meant to assist the City Council in the selection of technology for the replacement Water Treatment Plant as well as the creation of a detailed Basis of Design Report, which serves as the guidance document to determine overall project costs and schedule.
The first step, Phase 1a, was to perform a detailed analysis of treatment technologies, intake structure, and pipeline route. City Council approved Resolution 21-7013 In September 2021, which initiated Phase 1a services for the Replacement Water Treatment Plant project.
Phase 1b services, executed under Resolution 22-2207 on June 15, 2022, was implemented to select the membrane system chosen by Council as the preferred technology.
Phase 1c services, executed September 7, 2022, under Resolution 22-7245, will complete the design of the Council-selected alternatives and determine the Guaranteed Maximum Price for Council consideration. The design is scheduled to be completed in 16-18 months, and a Guaranteed Maximum Price should be ready to present to Council consideration in the Spring of 2024. The maximum fee for Phase 1c services is $5.7 million.
Phase 1d, membrane purchase, is the outcome of Phase 1b services. Working with the Design Build team, a Request for Proposals was issued, and three proposals were received by the Design Build Team for evaluation on September 8, 2022. H2O Innovation was recommended as the successful bidder for the reason listed above.
The proposal for a replacement water treatment plant is pursuing grant and low-interest financing through FEMA, Business Oregon, and the Drinking Water State Revolving Loan Fund. This Scope of Work pursued under Phase 1c services assumes the work must comply with federal funding requirements and Council direction, one of which requires Slayden, the Design-Builder, to advertise and encourage local contractor participation. The Council is also seeking a loan of approximately $57 million through the Water Infrastructure Finance and Innovation Act Program (WIFIA) to help finance the Water Treatment Plant project.