Item 10B AGENDA ITEM # 10B
OCTOBER 25, 2010
CITY OF ATLANTIC BEACH
CITY COMMISSION MEETING
TMDL COST ESTIMATE REPORT
AGENDA ITEM: Request for current, complete and accurate cost estimates
and report for the TMDL project prior to bid submittal and
issuing a notice to proceed.
SUBMITTED BY: Carolyn Woods, Commissioner
DATE: October 25, 2010
BEST PRACTICE: The need for updating and providing current accurate and
complete cost estimates is summed up very well in this excerpt.
"Cost estimating is one of the most important steps in project management. A
cost estimate establishes the base line of the project cost at different stages of
development of the project. Generally, the accuracy of a cost estimate will
reflect the information available at the time of estimation."
http://pmbook.ce.cmu.edu/ Chris Hendrickson, Department of Civil and Environmental
Engineering, Carnegie Mellon University, Pittsburgh, PA 15213 Copyright C. Hendrickson 1998.
BACKGROUND: The Atlantic Beach TMDL Project has been ongoing since
2004 when the State of Florida announced it would be implementing Total
Maximum Daily Loads, TMDL, of nitrogen that would be permitted to be
pumped into the St. Johns River by, among others, municipal utilities. The City
initiated a study which was completed by ATM, Inc. This report tried to identify
the City's needs, ability and anticipate costs to meet the State - mandated TMDL
requirements. The assumptions, recommendations and cost analysis reports
were based on the current information at the time.
The 2006 ATM report was followed by a more comprehensive report done jointly
by HDR, Inc. and John Collins Engineering (JCEA) and presented in December
2008. The old data used in the ATM report was reexamined, new data was
reviewed, the equipment and infrastructure abilities further scrutinized, new
assumptions were made, the costs were expanded and refined, and ultimately
new cost estimates and recommendations were made that should have been
based on a synthesis of new and old information.
Once again 2 years have passed and there has naturally been new data come to
light, equipment has been bid and chosen, existing infrastructure limitations
exposed, past assumptions have been challenged, and future costs have been
exposed and unaccounted for. In short, important information has not been
incorporated into the working plan and new and future costs were not included in
the initial working cost estimate which served as the basis for all decisions made
for this project.
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AGENDA ITEM # 10B
OCTOBER 25, 2010
INCOMPLETE COST ANALYSIS LEADS TO WRONG ASSUMPTIONS
W WTP #a Flows to W WTP #1 Transmission
Alternatives - New Pipe
TABLE 9.1 Known Costs that were not included
* Transmission Alternatives - New Pipe
Route Rank
Alternative Rank Low to Flow Shed Year 10 Low to
Number Cost High (piping) construction Cost High
1 $3,609,000 7 $690,000 $291,000 $4,299,000 7
$3,3 6 $690,000 $291,000 $4,010,000 6
1 Revision 1 $2,777,000 1 $690,000 $291,000 $3,758,000 4
1B $3,283,000 5 $690,000 $3,758,000 5
1B Revision
1 $2,820,000 2 $690,000 $291,000 $4,663,000 8
1C $2,915,000 3 $690,000 $291,000 $4,491,000 10
2 $3,7 9 $3,723,000 3
3 $3,680,000 8 $3,680,000 2
3
(Directional
Drill) $4,514,000 10 $4,5 9
4 $3,003,000 4 *3,003,000 1
*Note -t. Capitol Costs are for New Pipeline Construction only -
no costs included for pumping. 2. From HDR(JCEC 2008 report
This updated chart shows that had these known costs been included in the evaluation at the
I beginning of the project, all the routes that went to the west of Mayport Rd. through Hanna Park
and west of Oceanwalk would have been eliminated from further consideration.
This Commission has a moral and fiscal responsibility to insure this project is the
best plan and the right plan for the long -term future to meet the state mandated
requirements. This can only be done by allowing the data to drive the development
decisions. A decision based on accurate cost estimates is the cornerstone of
meeting these fiscal and management responsibilities.
OTHER FINDINGS: Through the process of designing a route through Hanna
Park, as problems arose to threaten the viability of this route, the decision was
made to postpone, until year 10, facing those issues. Of primarily concern are tree
mitigation in Hanna Park and easement acquisition along 5,300 feet of pipeline
and an ongoing lawsuit concerning another 1,950'. These issues would be
irrelevant had the correct decision been made at the beginning of the process.
That decision should have been to not run the pipes to the east of Mayport Rd.
because of cost.
INCOMPLETE COST ESTIMATE: Now we have reached a stage where
documents are being prepared to send this project out to bid. As discussed, it is
best management practice to update and evaluate cost estimates as a project
progresses, primarily to control costs. Because the Commission is charged with
the financial responsibility of the City's funds it is necessary that all of these
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AGENDA ITEM # 10B
OCTOBER 25, 2010
issues and the resulting costs be accounted for in the cost estimates for this
project provided to the Commission. When asked to provide a detailed cost
estimate the City Manager submitted the following.
Current Cost Estimate provided by City Manager on October 1, 2010:
Water and Wastewater Financing
Engineering Buccaneer Phase out $326,435
Main Plant $566,125
Construction Services $460,000
Construction of Buccaneer line, other misc. $3,500,000
Construction of main plant upgrades $6,169,000
Water main; Ocean $150,331
Lift Station upgrades $342,000
Replace Well #1 $752,456
Total Cost $12,266,347
Ball park estimates are not appropriate to base decisions on for appropriation of
funds. It is not too late to correct these wrongs and make an appropriately
informed decision.
BUDGET: Based on updated Table 1 potential savings start at $760,000.
RECOMMENDATION: Direct staff to prepare a detailed explanation for these
cost discrepancies and generate a new current, complete and accurate cost
estimate for the TMDL project, including previously dismissed routes, that
compares all relevant costs, not selected costs, so the comparison will be as
"apples to apples ", for the Commission's review and consideration at the next
Commission meeting and prior to bid submittal and issuing a notice to proceed.
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