DATE: April 24, 2024
TO: Council Infrastructure & Airport Committee
FROM: Director of Public Works
SUBJECT: Water Resource Recovery Facility (WRRF) Improvements, Phase II – Project Update
RECOMMENDATION
That the Council Infrastructure & Airport Committee (CIAC) reviews and comments on this report.
SUMMARY
This report is presented to update the CIAC on the progress of the WRRF Improvements – Phase II Project (Phase II Project). The project includes upgrades to the treatment process to enhance the treatment capabilities of WRRF and to reduce the discharge of nutrients to the bay in compliance with the Regional Water Quality Control Board’s upcoming 3rd Watershed Permit. This project also includes construction of a new Administration Building and Laboratory.
The Water Resource Recovery Facility (WRRF, formerly WPCF) treats an average flow of approximately eleven million gallons per day (MGD) and meets current regulatory requirements for discharge of treated effluent to the deep waters of the San Francisco Bay. However, the current draft of the Regional Water Quality Control Board watershed permit, which is scheduled for adoption and planned to go into effect in August 2024, requires a 50% reduction in nutrients by 2034. In preparation for meeting the new requirements, design is underway on improvements with construction bid packages planned for advertisement in August 2024 for the Administration Building, and May 2025 for the Phase II Project. The proposed improvements include a new administration and laboratory building, relocated primary effluent equalization (PE EQ) tanks, a new biological nutrient removal (BNR) process, a new grit removal facility, modifications to the existing solids contact tank, demolition of the functionally obsolete existing west trickling filter, and construction of related ancillary facilities including pump stations, new aeration blower facilities, new process piping, and electrical infrastructure to support the new facilities.
The Administration Building is at the 100% design level, and is expected to bid in the fall of 2024. Relocation of the PE EQ Facility is at the 90% design level. Though initially designed as a standalone project, staff now recommends merging this project with the overall Phase II Improvements, which is currently scheduled to bid in April of 2025 and begin construction in fall of 2025. Overall project completion is scheduled for January of 2030.
BACKGROUND
The core infrastructure of the Water Resource Recovery Facility (WRRF), formerly known as Water Pollution Control Facility (WPCF), was originally constructed in 1952 to treat wastewater flows from the City’s residents and businesses prior to discharge into the San Francisco Bay. Over the years, the WRRF has undergone several major upgrades to meet more stringent discharge requirements, as well as increasing capacity as the City’s population and industry have grown. The WRRF now treats an average flow of approximately eleven million gallons per day (MGD) and meets current regulatory requirements for discharge of treated effluent to the deep waters of the San Francisco Bay (Bay).
In response to growing concerns about nutrients and their impacts on the Bay, in May 2019, the San Francisco Bay Regional Water Quality Control Board (Water Board) announced upcoming regulatory requirements limiting discharge of nutrients (nitrogen) to the Bay. Currently 37 publicly owned treatment works discharge treated effluent to the Bay, representing about 2/3 of the annual nitrogen loads to the Bay. Under the 2nd Nutrients Watershed Permit released in 2019, the City anticipated being required to reduce nutrients by 30%. In the summer of 2022, a harmful algal bloom (red tide) occurred in the Bay that was wide-spread and resulted in significant fish kills throughout the Bay. In late July 2023, another red tide was observed but dissipated by early August and was not observed to have the same impact as the previous year. In response to these events, the Regional Water Quality Control Board began considering expanding the required reductions. In February of 2024, the Regional Water Quality Control Board released the Draft version of the 3rd Nutrients Watershed Permit. As currently written, this permit would require the East Bay Dischargers Authority (of which the City of Hayward is a member) to reduce nutrients by 50% by 2034. It is anticipated that Hayward’s share of the reduction would be 50%.
In June 2020, the City completed a comprehensive Master Plan update, the WPCF Phase II Facilities Plan (Facilities Plan) that identified improvements required to reduce nutrients in the treated effluent. In July 2022, Council authorized awarding design and engineering services during construction to Brown & Caldwell for the Phase II Project.
DISCUSSION
The main goal of the Phase II Project is to construct improvements necessary to enhance treatment capabilities of WRRF and to achieve nutrient reduction in compliance with the Water Board’s upcoming 3rd Watershed Permit limiting discharge of nutrients to the Bay. The design services for this project also include assistance to procure funding and to produce environmental documentation, preliminary design, final design, engineering services during construction, startup assistance, and preparation of an Operations and Maintenance Manual. To date, staff have considered the overall project to consist of 3 sub-projects: The Administration Building, the Primary Effluent Equalization (PE EQ) Facility and the WRRF Improvements, Phase II. Updates on each project are described below.
Administration Building
As part of the Facilities Plan, the space needs of the WRRF staff and laboratory were evaluated and multiple design alternatives developed. A schematic design and site plan for a new 19,750 square foot Administration and Laboratory Building was presented to the CIC on October 23, 2019. In July 2022, the preliminary design phase of the WPCF Improvements Phase II Project began which included review of the programming needs assessment with City staff to confirm the previous assumptions are still valid and to confirm the overall building size. In addition, the location of the building was shifted on the site to avoid conflicting with essential medium voltage ductbanks that provide power to both the main switchgear and the East Trickling Filter substation. This resulted in a reconfiguration of the building and layout on the site. Building renderings, material selection, and color studies were also developed to finalize the look of the exterior of the building. On October 26, 2022, an update on the Phase II Project was presented to CIC that included updated floor plans and exterior elevations for the Administration Building.
Staff received the 100% plans and specifications in April 2024, and have begun the planning and building permit processes and will soon begin the grading permit process. Conditions of approval are expected to be received in June 2024. The project is scheduled to bid in fall of 2024, with construction anticipated to begin around the end of 2024.
The total building area is 21,563 square feet. The Administration and Laboratory Building is being designed for LEED Silver, with energy efficient lighting and HVAC equipment, solar covered parking, use of recycled water for landscaping irrigation, and other green technologies. No natural gas will be used at the building.
Primary Effluent Equalization Facility
The purpose of the existing PE EQ Basin is to store primary effluent when wet weather flows exceed the secondary treatment capacity at the plant. Currently, flows are automatically diverted to the PE EQ Basin when flows exceed approximately 35 million gallons per day (mgd). Most of the secondary treatment improvements identified in the Facilities Plan are sited in the location currently occupied by the PE EQ Basin. Therefore, the PE EQ Basin must be relocated to make room for the new treatment facilities. The relocated PE EQ Facility will consist of two 1.5 million gallon tanks located east of Whitesell Street and north of the east trickling filter, with a total storage of 3 million gallons.
Staff received 60% Plans and Specifications for the PE EQ Facility in December 2023. 90% Plans and Specifications are expected in April of 2023.
To date, the PE EQ facility has been designed as its own project separate from the overall Phase II Project. When the overall project was originally scoped, it was believed that completing the design and construction of PE EQ Facility Project first would expedite the overall schedule and that the facility could be operational prior to demolishing the existing EQ basin. However, as the design has progressed, and construction durations and sequencing have been developed into a preliminary construction schedule, it has been determined that waiting until the EQ Facility is operational would delay the Phase II project start date by up to two years. This is because most of the Phase II project facilities lie within the footprint of the existing EQ basin (biological nutrient removal basin, blower/electrical building, and a third final clarifier), and construction duration of the PE EQ Facility is currently projected to be longer than was previously anticipated. Therefore, temporary bypass pumping and storage utilizing two of the plant’s winter sludge drying beds has been proposed to allow construction to proceed without having the PE EQ Facility operational. A temporary bypass pumping facility and storage also allows for construction of the PE EQ Facility to take place concurrently with the secondary treatment improvements. If performed by the same contractor, the following benefits could be realized:
May offer efficiencies in construction due to construction of similar facilities (concrete pile supported structures) for the PE EQ tanks and the biological nutrient removal (BNR) basins.
Minimize risk of two contractors competing with each other for space and timing of plant shutdowns, which would limit the overall risk of increased costs due to change orders.
Provide for more consistency in electrical and mechanical equipment, as well as programming and integration of the supervisory control and data acquisition (SCADA) system.
Due to the above benefits, staff recommend combining the PE EQ Facility project with the overall Phase II Project into one construction package.
WRRF Improvements – Phase II Project
All preliminary technical memoranda have been completed for the Phase II project, and a preliminary design report compiling all the technical memoranda is expected to be completed in April 2024. The Phase II Project remains similar to how it was originally scoped with several changes which are outlined below.
Five Basins treating 75% of flow: The project was originally scoped to treat 50% of the City’s average dry weather flow, which would have required four biological nutrient removal basins. This would achieve 30% removal of nutrients, as was originally anticipated at the time of the 2nd Nutrients Water shed permit. However, the 3rd Nutrients Watershed, as currently written, requires 50% removal of nutrients. This necessitates sending 75% of average dry weather flow through the biological nutrient removal basins, which requires a 5th basin. A 5th basin has the added benefit of allowing for greater flexibility in plant operations.
Final Clarifiers Rehabilitation: As originally scoped, staff had expected the existing final clarifiers could be rehabilitated by replacing failed concrete and adding external dewatering wells to relieve external hydrostatic pressures on the clarifiers when they are dewatered for routine maintenance. A hydrogeological investigation determined that it was not feasible to lower the groundwater surface with external wells and pumping systems due to the low permeability of the surrounding soils. Therefore, to protect the structures during future maintenance activities, a full clarifier re-build is required. The retrofit includes installing micropiles under the clarifier slab to resist buoyant uplift, adding additional thickness to the existing slab, constructing new interior walls to resist the hydrostatic loading, and replacing the interior mechanisms due to the smaller interior diameter. These improvements are expected to extend the useful life of the structure by 50 or more years. These improvements must also be constructed one clarifier at a time following completion of the new third final clarifier. Because of the extent of the clarifier rehabilitation, and the constraint to complete the rebuilds one clarifier at a time following completion of the new clarifier, the overall project schedule is extended by a year.
Construction Cost Update
Construction cost estimates have been updated for the Administration Building and the Primary Effluent Equalization Facility based on 90% (Class 1) and 60% (Class 2) design levels of completion, respectively (though the City is in receipt of 100% plans and specifications for the Administration Building, the 100% construction cost estimate is not yet available). Phase II project elements are based on 30% (Class 4) design level of completion and are also updated to reflect the updated construction schedule and escalation factors for the new estimated midpoint of construction dates for the various elements. Because the overall estimated construction duration of the Phase II project increased by a year, some of the project elements that are constructed later in the project such as the grit facility and the final clarifier retrofits experienced cost escalations over previously presented costs. Nutrient treatment upgrades costs also reflect the addition of bypass pumping for primary effluent because the PE EQ Facility is now constructed in parallel with the Phase II Improvements. These costs will continue to be updated as the project progresses to the 60% design level of completion which is expected to be completed in June 2024.
Table 1 – Estimated Construction Cost(1)(2)
Project Element
Estimated Construction Cost(3)
(December 2023)
Current Estimated Construction Cost (April 2024)
New Grit Facility
$21.0M
Range $15 - $32M
$22.9M
Range $16 - $34M
New Primary Equalization (PE EQ) Tanks
$21.3M
Range $15 - $32M
$ 29.5M
Range $25 - $35M
Nutrient Upgrades
$134M
Range $94 – $201M
$136M
Range $95 - $204M
Existing Final Clarifiers Retrofits
$25.1M
Range $18 – $38M
$26.8M
Range $19 - $40M
New Administration Building and Laboratory
$31.9M
Range $27 - $38M
$34.8M
Range $31 – $40M
Site Waste Pump Station (SWPS) Improvements
$1.5M
Range $1.0 to $2.2M
$1.4M
Range $1.0 – $2.2M
3W System Upgrades
$4.8M
Range $3.4 to $7.2M
$4.6M
Range $3.3 - $7.0M
Total Estimated Construction Cost
$239M
Range $173 to $350M
$256M
Range $191 - $363M
Notes:
Soft costs including design, engineering services during construction, construction management, inspection, materials testing, etc. are not included in the above costs.
Range reflects the accuracy of the estimate based on the design level of completion. The Administration Building and Laboratory estimate at 90% design level of completion (Class 1) range of accuracy is -10% to + 15%. PE EQ Facility is at 60% design level completion (Class 2) with a typical range of accuracy of -15% to +20%. The remaining project elements at 30% complete (Class 4) have a range of accuracy between -30% to +50%.
Costs from the December 12, 2023 staff report Resolution Authorizing the City Manager to Apply for a United States Environmental Protection Agency (EPA) Water Infrastructure Finance and Innovation Act (WIFIA) Loan for the Water Pollution Control Facility (WPCF) Improvements – Phase II Project No. 07760).
Total Capital Cost
Total capital costs are in the process of being updated as part of the financing effort currently underway. Capital costs include facility planning, engineering design, support services during construction, construction management, administrative change orders during construction, staff time, financing costs, and other miscellaneous items like the cost of obtaining a building permit, etc. The total estimated project cost ($530M) was presented in the April 16, 2024, staff report. A breakdown of the estimated capital cost is presented in Table 2. Note that the capital cost range presented is based on the construction cost estimate rather than including the low end of the range because costs generally have not decreased with increasing accuracies of the estimate on this project. The upper end of the range (also presented in Table 2) is currently being used for developing the financing strategy and for the WIFIA loan application. The dollar amount requested can be adjusted down without penalty prior to loan closing.
Table 2 – Estimated Total Project Cost
Element
Estimated Construction Cost
(April 2024)
Estimated Construction Cost High Range of Estimate
(April 2024)
Estimated Construction Cost
$256.3M
$363.5M
Administrative Change Orders (ACO) (10% of Construction Cost) $25.6M
$36.4M
Design and Engineering Services During Construction
$23.5M
$23.5M
Planning
$0.75M
$0.75M
Construction Management
$22.0M
$22.0M
Staff Time
$5.0M
$5.0M
Miscellaneous (Building permit, IT, LEED commissioning, etc.) $0.5M
$0.5M
Project Contingency (Assume 10% of Construction Cost and ACO) $28.2M
$40.0M
Financing Costs & Debt Service Reserve Funds (Estimated) $31.9M
$42.7M
Total Project Cost
$394M
$534M
ECONOMIC IMPACT
The current estimated construction cost is estimated to be between $256 and $364 million, and the total project cost is estimated to be between $394 and $534M. This project will affect sewer service rates and sewer connection fees. The extent to which rates will need to be adjusted cannot be determined with certainty at this point, however it is anticipated that customers could see a significant impact over the current rates. The impact to rate payers is currently being evaluated as part of an overall funding strategy approach and in support of a WIFIA loan application as well as funding through a combination of bonding and cash. Funding efforts may also pursue financing under the CWSRF loan program however the preliminary outlook indicates due to competing projects with higher scores than what the Phase II Project is able to score, it is unlikely that securing CWSRF funding will be successful.
FISCAL IMPACT
The estimated total capital cost for the overall project is estimated to be between $394 and $534M. The cost breakdown is provided in Table 2 above.
As the design progresses, the estimated project cost is expected to be adjusted, especially as construction costs become more refined as the design becomes more complete. Budget adjustments will be brought forward to Council through the annual budget approval process and upon Council award of the construction contracts. Approval of plans and specifications and call for bids for the Administration Building Project is anticipated for August 2024, with construction award in November 2024. Approval of plans and specifications and call for bids for the combined PE EQ Facility Project and the Phase II Project is anticipated for April 2025, with construction award in August 2025.
As noted above, Staff is in the process of applying for a WIFIA loan and considering applying for funding from CWSRF in the future, as well as selling bonds. WIFIA funding can be applied to fund multiple projects, as well as retroactively reimburse for engineering design services, however WIFIA funds can only cover 49% of the eligible project costs. The Administration Building will not be eligible to apply for CWSRF since it will not be able to score high enough to be on the eligible list. Only the Phase II Project is likely to score high enough to be eligible for CWSRF funding; however, loans are currently limited to $50 million in the FY 23-24 funding cycle, and competition is very high with many projects already included on the eligible funding list ahead of the City’s project and with higher scores/priorities. Furthermore, CWSRF may experience a funding hiatus where new projects are not considered for funding that could start in FY 25, therefore Staff are pursuing financing through bonds as part of the funding strategy. Staff will also continue to seek grants throughout the life of the project.
STRATEGIC ROADMAP
This agenda item supports the various goals of Council’s Strategic Roadmap. The WPCF Improvements Phase II Project will address infrastructure needs and improvements to increase the reliability of the City’s treatment plant, and construct process improvements to meet more stringent nutrient limits in accordance with upcoming regulatory requirements, while supporting the goals of the Council. Specifically, this item relates to the implementation of the following projects:
Confront Climate Crises & Champion Environmental Justice.
Mitigate Climate Crisis Impacts through Resilient Design and Community Engagement Project C14b: Implement Shoreline Master Plan, including mitigating sea level rise in the industrial corridor through building requirements and outreach Invest in Infrastructure.
Invest in Water Supplies, Sanitation Infrastructure & Storm Sewers Project N19: Update Water Pollution Control Facility Phase II Plan
SUSTAINABILITY FEATURES
The WRRF Improvement Project Phase II will help maintain and improve the biology and health of the Bay which is vital for the region and the State. The Phase II Project will position the City to meet the nutrient limits as specified in the Water board’s 3rd Watershed Permit to reduce nitrogen loads to the Bay.
The effects and risks of rising sea water levels will be reviewed and incorporated into the design of the new facilities and some retrofitted facilities where appropriate.
The Administration and Laboratory Building will be reviewed by the City’s Building Division for conformance with State and local requirements related to sustainability (i.e., California Building Code, California Energy Code, etc.) which require a minimum level of energy efficiency, resource conservation, material recycling, etc. In addition, the building will be designed and constructed to meet the City required Leadership in Energy and Environmental Design (LEED) standards for a Silver Certification.
PUBLIC CONTACT
As part of the funding process, an environmental study (CEQA and/or Initial Study and Mitigated Negative Declaration) will be posted for public review and comment.
The project includes a web page to be hosted on the City’s website which is being periodically updated throughout the multi-year duration of the project.
NEXT STEPS
The following schedule has been developed for this project:
Submit WIFIA Application
June 2024
Approval of Environmental Study – IS/MND or CEQA
June 2024
Approval of Plans and Specifications and Call for Bids for the Administration and Laboratory Building August 2024
Award of Construction Contract for the Administration Building Project November 2024
WIFIA Loan Fully Funded
January 2025
Approval of Plans and Specifications and Call for Bids for the Phase II Improvements Project April 2025
Award of Construction Contract for the Phase II Improvements Project August 2025
Administration Building Project Construction Completion January 2027
Phase II Improvements Project Construction Completion
January 2030
Prepared by: Kyle Carbert, Senior Civil Engineer
Reviewed by: Suzan England, Utilities Engineering Manager Recommended by: Alex Ameri, Director of Public Works
Approved by:
________________________________________
Kelly McAdoo, City Manager
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