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Tolt Treatment Facility
Design-Build-Operate Process
The decision to go Design-Build-Operate (DBO)
Seattle initiated pre-design efforts for the Tolt Filtration Plant in 1991, including water quality studies, environmental studies and preparation of an Environmental Impact Study (EIS), preliminary permitting, and project pre-design. Studies recommended development of a 120 million gallon per day (MGD), or 454,000 cubic meters per day (CMD), filtration plant on a site located approximately 1.5 miles downstream of the existing Tolt Regulating Basin.
During the pre-design phase, the City anticipated implementing the project through a traditional design-bid-build process, where a competitively bid construction contract is awarded with an independent design engineer's specifications, and the City does the operation. Based on the pre-design work completed in 1995, the City anticipated total costs of $156 million (net present value, 1998 basis) - construction costs of approximately $100 million and operations and renewal costs estimated at $56 million over a 25-year period. This estimate was for a filtration only facility (no ozonation or sedimentation).
The City's interest in pursuing the most cost-effective approach to completing development of the Tolt Filtration Plant led Seattle to pursue a design-build-operate (DBO) procurement process in developing the plant. DBO is a non-traditional approach to project implementation wherein proposers compete for a contract that includes design, construction, and long-term facility operation.
The City determined that, as the entity ultimately responsible for providing a safe and reliable water supply, it should maintain ownership of the facility. Economic analysis and market feedback concluded DBO to be the least cost approach over the long term.
The City's objective in using the DBO process has been to obtain the most reliable and efficient technology at the lowest life-cycle cost. The utility was authorized to explore such a process through a City Council resolution enacted in December 1995. At this time, SPU (then the Seattle Water Department), began to solicit for a Support Services Consultant for assistance in the DBO solicitation, evaluation, and negotiation processes.
A team of RW Beck and Malcolm Pirnie was selected for this role -- bringing technical expertise related to the design of major treatment facilities, as well as expertise in the area of alternate contracting processes. This augmented a very high level City project team, comprised of water quality, engineering, and policy and administrative leadership in SPU. Additional specialty skills were brought with other independent technical, legal, and financial advisors.
About the DBO process
The design-build-operate (DBO) approach to public agency contracting existed due to Washington State legislation enacted in 1994 (RCW Ch. 39.10) and extended in May of 1997, which authorizes entities such as the City of Seattle to use alternative public works contracting procedures. Seattle Public Utilities was authorized to explore such a process through a City Council resolution enacted in December 1995.
The DBO procurement process differs substantially from typical public works contracting, where construction contractors are asked to bid on a detailed design and the lowest responsive bidder is selected. In contrast, design-build (DB) and DBO procurement processes typically involve creation of performance specifications that describe desired outcomes and then ask proposers to develop their own concepts on how to best achieve those outcomes.
The intent of the City in using this solicitation process was to encourage teams to use their entrepreneurial initiative to provide the best solution for the project.
Proposal teams consisted of designers, construction contractors, contract operators, and support firms. The selected team managed the design, permitting and construction, and assumed the risk for coordinated project implementation.
Upon completion of the construction, the DBO team assumed responsibility for operating the plan, training staff, implementing a detailed operations and maintenance plan, and guaranteeing operational performance of the facility. Currently, the DBO team is managing facility operations and is responsible for meeting the strict performance standards prescribed by the City, including environmental protection standards.
DBO Philosophy
At the outset of the design-build-operate (DBO) procurement phase Seattle Public Utilities established the following project philosophy for the implementation of the design-build-operate (DBO) project:
- • That the City describes its needs in terms of performance requirements and standards, and then let vendors propose solutions for how to achieve these requirements;
- • That technological innovation be encouraged within the range of proven technology, and competition be used to achieve both technical innovation and lower cost;
- • That risk be allocated between the City and the vendor in a manner which minimizes overall project costs (i.e., assign the risk to the part best able to manage it).
This philosophy formed the foundation for development of the Request for Qualifications, Request for Proposals, and Service Agreement.
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