The Wastewater Treatment Plant Upgrade

On February 16, 2010, the Morro Bay- Cayucos Joint Powers Authority (JPA) voted to award the contract for the Morro Bay-Cayucos Wastewater Treatment Plant (WWTP) upgrade design project to Montgomery, Watson, and Harza (MWH),   The decision was based upon a recommendation by a committee composed of Morro Bay City staff, Cayucos CSD staff, and a retired City of Pismo Beach employee.  Concerned residents believe that this project will cost rate payers far more than necessary, and that far better options exist for wastewater treatment.

 

Contract not Awarded to Lowest Responsible Bidder

 

MWH did not submit the lowest bid on the project.  Theirs was the highest.  Morro Bay’s Municipal Code requires that contracts be awarded to the lowest responsible bidder.  The five companies competing for the contract were Brown & Caldwell, Carollo Engineers, CDM, Hydroscience, and MWH.  Documentation produced during the evaluation process indicates that all five were considered qualified and competent to do the work.  

 

Incorrect Project Schedule Limited Options

 

Concerned residents have noted that there would likely have been more qualified proposers had the City of Morro Bay not posted an inaccurate project schedule on its Web page “WWTP Upgrade Information”.   Schedule task 65 indicated that  the request for proposal (RFP) for the project would be issued on Monday, May 31, 2010.  In fact, the RFP was issued 8 months early, on October 1, 2009.  

 

One of the vendors relying on the erroneous schedule was PERC Water, a California-based firm that specializes in wastewater recycling.  PERC Water employs state-of-the art technology and, according to its Web site, guarantees fixed capital cost, operating cost, and delivery schedule for the facilities it builds. No such guarantees were offered by MWH under the contract awarded by the JPA.   

 

Perc Water facilities occupy significantly less land area than traditional plants using older technologies, such as the one currently being designed by MWH.  PERC wastewater recycling plants have been in operation for over 10 years in Arizona, California, and New Mexico. PERC Water also offers a Design, Build, Operate, Finance (DBOF) approach, which transfers much of the project risk related to cost, and meeting water quality regulations, from the client to PERC Water.  While we do not endorse any particular vendor, we have thus far found none that offer advantages comparable to those available from PERC, and suggest that the package that the firm offers may be used as a benchmark for evaluating other options.

 

Upon learning that not only had the RFP been issued 8 months ahead of schedule, but that a decision to award the contract had already been made, PERC Water contacted local officials to see there was still a possibility of their firm getting the job.  It was determined that the contract the JPA had executed with MWH contains suspension and cancellation clauses that would make it possible for the JPA to pull out of the deal without penalties.

 

Residents’ Push for Consideration of Alternate Project

 

Morro Bay residents learned of the potential of the newer technology when, at the recommendation of concerned residents, PERC  Water representatives spoke during public comment at the 03/08/10 Morro Bay City Council meeting.  PERC Water was subsequently invited to give a presentation at the Morro Bay Business and Community forum later that week.  Forum attendees expressed surprise and concern that PERC Water had not been considered for the contract, and in response to their questions, were told of the schedule problem and the failure of a Morro Bay employee to respond to phone calls regarding setup of a presentation to City staff and officials.

 

At the 04/08/10 JPA meeting, about 10 residents spoke during public comment and urged consideration of a switch to the PERC Water technology, or possibly a similar technology offered by another firm.  Council members Winholtz and Smukler indicated that their research showed there was a potential for major cost savings and environmental benefits if the JPA were to switch from the current project to a PERC Water facility, or one built using similar technology. They also emphasized that PERC Water facilities take a relatively short time to build, so there would be no risk of missing State agency-imposed deadlines for the project.  They asked for a PERC Water presentation, and possibly other presentations from vendors offering similar packages, to be made at the next JPA meeting.  

 

JPA Decisions         

At the 04/08/10, a  majority of JPA members from Morro Bay  (Mayor Janice Peters and Council members  Rick Grantham, and Carla Borchard) voted against the presentation requested by residents.   JPA member Robert  Enns, of the Cayucos Sanitary District stated that he intended to visit PERC Water’s Santa Paula facility to evaluate the potential benefits of the technology. Mr. Enns is an engineer.  Morro Bay JPA and City Council member Smukler also announced his intentions to visit the site.  The trip took place on April 28.  

 

The majority  of JPA members, including Peters, Grantham and Borchard, stated they were unwilling to consider briefly suspending the current project while research was done, despite expressed concerns that money continues to be spent on the current project, even though a decision may be made to change course.

 

On 06/16/10, however, the JPA reversed its earlier position and voted unanimously to instruct staff to assist PERC as necessary so that the firm could prepare a customized design report (CDR).  The June 16 JPA meeting was well-attended, and numerous Morro Bay and Cayucos residents spoke in favor of giving PERC Water a chance to “put the numbers on the table”.   The CDR, which will be complete in mid-August, will present PERC’s design and guaranteed final cost.

 

 

Resident Response

 

Residents reacted positively to the June 16 decision.  

 

Previously, rResidents concerned about the potential loss of an opportunity to build a superior facility and save 10 million dollars in the bargain - and thus to keep our water and sewer bills as low as possible - had asked that their neighbors learn more about the issue and contact their elected officials.  

Concerned residents suggest some additional reading for those who wish to pursue this issue, and recommend listening to the 4/08/10 and 5/13/10 JPA meetings on SLO Span.