Results of the Request for Proposals for the

Water Pollution Control Process Control

System Detailed Design Project

The Works Committee recommends:

(1)the adoption of the joint report dated September 28, 1999, from the Commissioner of Works and Emergency Services and the Chief Financial Officer and Treasurer; and

(2)that under no circumstances are there to be reductions in water quality and that continued improvements of quality should be considered an ongoing objective.

The Works Committee reports, for the information of Council, having considered together the following reports related to the Works Best Practices Program:

(i)(September 27, 1999) from the Commissioner of Works and Emergency Services, headed "Request for Proposals for Selection of Vendors for Supply of Process Control Systems (SCADA) Software, Contract No. MWRFP199";

(ii)(September 22, 1999) from the Commissioner of Works and Emergency Services, headed

"Engagement of Professional Services to Undertake the Preliminary Design of Process Control Systems at the R.C. Harris, R.L. Clark, F.J. Horgan and Island Water Treatment Plants";

(iii)(September 22, 1999) from the Commissioner of Works and Emergency Services, headed"Engagement of Professional Services to Undertake the Preliminary Design of a ProcessControl System for the Water Transmission System";

(iv)(September 28, 1999) from the Commissioner of Works and Emergency Services and the Chief Financial Officer and Treasurer, headed "Results of the Request for Proposals for the

Water Pollution Control Process Control System Detailed Design Project"; and

(v)(September 27, 1999) from the Commissioner of Works and Emergency Services and the Chief Financial Officer and Treasurer, headed "Request for Proposals for the Procurement of Program Integration and Coordination Services for Phase 2 of the Works Best Practices Program, and Award of Contract";

and having directed that:

(1)a meeting of the Works Best Practices Program Work Group be convened prior to the Council meeting scheduled for October 26, 27 and 28, 1999;

(2)Union representatives be formally invited to meetings respecting Best Practices when these involve Toronto Civic Employees' Union Local 416 members, and that confirmation that invitations were received be obtained; especially important will be Local 416 and Local 79 involvement in all Teams, particularly items (4) "Organizational Services" and (5) "Integrated Works Area Implementation" under the Program Integration and Coordination Services for Phase 2;

(3)a written statement, to Council, be requested from EMA Canada concerning the firm's position on water quality as a part of Works Best Practices development and Union involvement in best practices development and implementation;

(4)the City Auditor be requested to report directly to Council on the aforementioned report headed "Request for Proposals for the Procurement of Program Integration and Coordination Services for Phase 2 of the Works Best Practices Program, and Award of Contract", wherein seven expressions of interest were received, two firms were given the opportunity to bid and one of those withdrew; and

(5)the Commissioner of Works and Emergency Services be requested to submit a report directly to City Council on the aforementioned reports, which outlines in simple terms the number of persons that are being hired under these contracts, the number of hours and hourly rate of pay of those persons, and the type of performance analysis to be undertaken as this project proceeds.

The Works Committee submits the following joint report (September 28, 1999) from the Commissioner of Works and Emergency Services and the Chief Financial Officer and Treasurer:

Purpose:

The purpose of this report is to present the results of the Request for Proposals (RFP) for the selection of professional services to carry out Process Control System (PCS) detailed design work in the City of Toronto's three major wastewater treatment plants, and to obtain approval to award the assignments to the successful firms.

Executive Summary:

The Works Best Practices Program (WBPP) was approved by Council in 1999 for continuation as per the revised plan that called for completion in 2003, and requiring estimated funds of $110 million with a net annual saving of $36 million when fully implemented. As part of the implementation, the next step is to hire the professional service companies that will carry out the detailed design of the process control system necessary for the full automation of the three main wastewater treatment plants.

During the preliminary design stage, it was identified that the plant heating, ventilation and air conditioning (HVAC), plus plant water and air systems as well as employee/facility protection systems could be added for automation and additional savings would be achieved. It was decided to include this work in the RFP and then review the cost benefit of doing the work as part of this phase. Funding has not been approved at this time for this work. We will be including these increased costs to our 2000 Capital Budget submission, along with the revised cost benefit analysis which will support the inclusion of this work. Since this scope was identified in the Request for Proposal, we will be seeking authority, upon approval of the 2000 Capital Works Program, for the assignment of this work to recommended firms.

Based on the analysis of the proposals we are recommending the PCS detailed design be awarded to the following companies:

PCS Project Award Summary

* Includes GST but not contingencies.

Funding Sources, Financial Implications and Impact Statement:

On March 2, 3, and 4, 1999, City of Toronto Council adopted Clause No. 1 of Report No. 3 of The Strategic Priorities and Planning Committee, approving the 1999 - 2003 Capital Budget and Five-Year Capital Program which included approval of funding in the amount of $110,192,000.00 after Municipal GST Rebate for the Works Best Practices Program (WBPP). These funds are available in the Water and Wastewater Services Division, Water Supply Capital Account No. C-WS026 and Water Pollution Control Capital Accounts Nos. C-WP001, WP096, WP115, and WP160.

Additional funds are required to provide for automation of environmental and employee/facility protection systems not originally in the 1994 WBPP scope of work. The additional funds will be included in the 2000 Capital Works Submission. The cost benefit analysis will be provided in further reports, which will support the inclusion of this work as part of the PCS implementation.

Recommendations:

It is recommended that:

(1)the assignment for process control system detailed design at the Ashbridges Bay Treatment Plant be awarded to the firm of CH2M Gore & Storrie Limited at a cost of $10,140,256.00 including the Goods and Services Tax (GST) to meet the current savings target;

(2)the assignment for process control system detailed design at the Humber Treatment Plant be awarded to Azurix North America (formerly Thorburn Penny Limited) at a cost of $5,103,403.00 including GST to meet the current savings target;

(3)the assignment for process control system detailed design at the Highland Creek Treatment Plant be awarded to Earth Tech (Canada) Inc. (formerly Proctor & Redfern Limited) at a cost of $2,734,549.00 including GST to meet the current savings target;

(4)subject to the approval of Recommendations Nos. (1), (2), and (3), a contingency amount of $500,000.00 be provided for each of the assignments to CH2M Gore & Storrie Limited and to Azurix North America and $250,000.00 be provided for the assignment to Earth Tech (Canada) Inc. for a total amount of $1,250,000.00, to cover any additional design services, if necessary and as authorized by the Commissioner of Works and Emergency Services; and

(5)the appropriate City officials be authorized to take the necessary action to give effect thereto.

Council Reference/Background/History:

On July 2 and 3, 1997, the former Metropolitan Council adopted Clause No. 3 of Report No. 13 of The Financial Priorities Committee authorizing implementation of the Works Best Practices Program in the Works Department.

In the wastewater area of the Water and Wastewater Services Division, process control system preliminary design work was completed in 1997. A two-stage process of Expressions of Interest followed by a Request for Proposals was then put in place to select consultants for the process control system detailed design at the Ashbridges Bay, Humber, and Highland Creek Treatment Plants. The details of this professional service selection process are outlined in Appendix "A".

On February 5, 1999, the Works and Emergency Services Department received four proposals in response to its Request for Proposals dated December 10, 1998. Detailed technical proposals, including separate sealed cost proposals, were submitted by CH2M Gore & Storrie Limited, Thorburn Penny Limited, Proctor & Redfern Limited, and the Greater Toronto Consulting Group.

All of the proposals were reviewed by a Selection Committee based on a pre-selection process of evaluating the proposals against specified technical criteria. Following detailed review of the technical aspects of the submissions, three firms qualified for further consideration and the price envelopes were opened. The three firms were CH2M Gore & Storrie Limited, Thorburn Penny Limited (now Azurix, North America), and Proctor & Redfern Limited (now Earth Tech (Canada) Inc.).

Interviews were held with the three short-listed firms in order to clarify and finalize the specific scope of work required and the related costs involved. Further dialogue and communication took place after the interviews.

The selection committee concluded that the proposals submitted by the three short-listed firms satisfied the overall project requirements at a fair and reasonable cost, and has recommended one company for each of the three plants.

Comments and Justification:

The Works Best Practices Program (WBPP) is an extended and involved project with the objective of integrating organization, practices, and technology to more efficiently work together as a redefined, business-driven, public utility. One of the key elements is automation of the plants and upgrading of the old computerized systems.

The objective of the Process Control System (PCS) is to contribute to the overall WBPP objectives of effective, cost efficient operation through reduced chemical, energy, and other facility operating costs. To date, the PCS design has focused on the Water Pollution Control (WPC) Preliminary Designs for the three wastewater treatment facilities at Highland Creek, Humber and Ashbridges Bay. This also includes each facility's portion of the Collection System as it was defined prior to amalgamation.

The award of these contracts for the Detailed Design of the PCS will provide for the review and verification of the performance of existing field instruments, mechanical equipment, and related components to meet newly-developed standards, and will add or replace wherever the system is deficient. The PCS project will apply standards for process operation, equipment selection and installation across the three plants. Automation in the form of field computer hardware, associated software and networks will collect information from field instrumentation (such as flow readings, valve opening status, and pump speeds, etc.) to provide full control of process operation according to predetermined performance standards or objectives.

An unattended operation philosophy has been adopted to suggest a minimal quantity of operational staff will be present at the facility to respond to exceptional and/or alarm conditions. The PCS Detailed Design RFP incorporated the necessary level of automatic control, monitoring, and alarm notification to match this environment.

To meet the organizational needs for information beyond the specific requirements of process control, the PCS will support other computer applications, such as the Performance and Operations Management System (POMS), Work Management System (WMS) and Laboratory Information Management System (LIMS). These other applications will require process information from PCS to be able to provide performance information to staff for process optimization and cost control. Work Areas, consisting of a related group of processes operated by one team, will use the PCS to execute the most cost-effective operating strategies while assessing performance via the POMS and organizing the most efficient maintenance practices using the WMS.

The original estimates were for automation of the wastewater treatment processes only, and did not include environmental or employee/facility protection systems. A future report will be issued requesting an increase in the scope of the project to cover environmental, and employee/facility protection systems.

As the Preliminary Design progressed, it became apparent that there could be benefits accrued by automating the environmental and employee/facility protection systems. The environmental systems include heating, ventilation, and equipment cooling and air conditioning (HVAC), plus the plants' water and air systems. These systems do not currently have any centralized monitoring or control system, and therefore operators are required to visit remote sites for operational inspection and control adjustment of the equipment.

The employee/facility protection systems that are also planned to be automated include local alarm systems for smoke/fire, hazardous gas releases, odour control, site security, and flooding. Automation would provide alarms to specified staff for resolution.

The proposed revisions to the design will provide for continuous process and alarm monitoring of the complete working environment and employee/facility protection systems from anywhere within a plant. The process control system will allow for operator adjustments from anywhere in the plant and the protection alarm systems will advise of a problem/emergency and allow staff to react accordingly. With the proposed automation, the equipment/facilities will require fewer people to perform with better control.

We will provide for this funding as part of the 2000 Capital Works Program, complete with a business case analysis which would defend this expenditure. We will be recommending that this work be added to the assignments of the firms selected to do the PCS detailed design. A project management component has been incorporated as part of these costs to cover the increased scope. This will be further identified in an upcoming Program Integration and Coordination award report to the Works Committee.

The new benefits to be realized will include:

-monitoring of the complete working environment (HVAC, boilers, hot/cold water, steam, etc.);

-pre-emptive alarm protection for staff and facilities (smoke/fire, flooding, site security, etc.); and

-alarm and response to hazardous conditions immediately (chlorine leaks, hazardous wastewater vapours, methane etc.).

Other benefits include:

-economy of scale for design and implementation by doing the work now rather than a later date;

-standardized approach in the design, use of integrated components, and a common user interface for the process and auxiliary system; and

-lower life-cycle costs for the common implementation, such as less training requirements, fewer spare parts, etc.

The Manager, Fair Wage and Labour Trades Office, has reported favourably on the firms recommended.

The issuance of these consulting assignments pre-dates the Chief Administrative Officer's direction to use Purchasing for consulting services proposal calls.

Conclusions:

It is recommended that CH2M Gore & Storrie be awarded the assignment for the Ashbridges Bay Plant, Azurix North America be awarded the assignment for the Humber Treatment Plant, and Earth Tech (Canada) Inc. be awarded the assignment for the Highland Creek Treatment Plant.

We will be adding the environmental and employee/facility protection systems to our 2000 Capital Works Program and will seek authority to add this to the selected firms' assignments.

Contact Name:

A. Pagnanelli, P. Eng.J. Boccia, P. Eng.

Manager, Plant & Facility ConstructionManager, WBPP (Acting)

Engineering ServicesWater Pollution Control

Works Facilities and StructuresWater and Wastewater Division

Technical Services DivisionTel. (416) 397-0952 Fax. (416) 397-0908

Tel. (416) 392-8245 Fax. (416) 392-4594

Appendix 'A'

Water Pollution Control Process

Control System Detailed Design and

Year 2000 Design, Remediation and Testing

Details of the Selection Process

(1)A two-stage process was undertaken whereby Expressions of Interest were requested first, followed by a Request for Proposals from the short-listed proponents.

(2)Eleven firms with experience in similar work were chosen from a roster of qualified companies and invited to submit Expressions of Interest. Seven responses were received and evaluated according to a set of pre-established criteria by representatives from the Water and Wastewater Services and Technical Services Divisions of the Works and Emergency Services Department.

(3)Using a threshold level of 75 percent of the maximum attainable score as a criterion, evaluation of the Expressions of Interest resulted in a short list of five firms. Detailed written proposals, including separate sealed cost proposals, were requested from the five firms and received from four of the five firms.

(4)A formal selection committee was struck to evaluate the detailed proposals. As with the Expressions of Interest, the committee was comprised of representatives from the Water and Wastewater Services and Technical Services Divisions of the Department.

(5)The technical submissions were reviewed first independently and then jointly by members of the selection committee, and were evaluated according to a set of pre-established criteria. Once again, a threshold level of 75 percent of the maximum attainable score had been previously established as the criterion for the next step that was a review of the separately submitted sealed cost proposals.

(6)Accordingly, following the detailed review of the technical submissions, three of the four firms qualified for further consideration through a review of their cost proposals. The cost proposals were reviewed for the short-listed three firms, and the cost proposals for the one firm whose submission scored below the threshold level of 75 percent was returned unopened.

(7)The three short-listed firms were then interviewed in order to clarify and finalize the specific scope of work required and the related costs involved. Further dialogue and communication took place after the interviews, and all of the proponents were requested to provide written clarification to proposal items.

(8)On completion of all the above, the selection committee concluded that all three of the proposals submitted satisfied the overall project requirements at a reasonable cost, by demonstrating an appropriate level of effort to properly address the critical elements of the work.

(9)As specified in the Request for Proposals, the City reserved its right to treat the Year 2000 (Y2K) scope of work component as distinct and separate from the Process Control System (PSC) Detailed Design component because of the tight time frames for Y2K work and the fact that the funding for Y2K had already been approved. Accordingly, the Year 2000 (Y2K) Design, Remediation and Testing component of the project was dealt with separately by the City of Toronto Year 2000 Project Office. Approval of the PCS Detailed Design component is the scope of work being dealt with herein.

(10)It was recommended that each of the three firms be awarded the Y2K and PCS detailed design work for one of the wastewater treatment plants. The recommended firms for the work are as follows:

(a)Ashbridges Bay Treatment Plant - work to be done by CH2M Gore & Storrie Limited;

(b)Humber Treatment Plant - work to be done by Azurix North America (formerly Thorburn Penny Limited); and

(c)Highland Creek Treatment Plant - work to be done by Earth Tech (Canada) Inc. (formerly Proctor & Redfern Limited).

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The Works Committee reports, for the information of Council, having also had before it during consideration of the foregoing matter the following communications:

(1)(October 6, 1999) from Mr. Brian Cochrane, President, Toronto Civic Employees' Union, Local 416, expressing concerns with respect to the Works Best Practices Program, and the implications of the reports for approval of expenditures on Process Control Systems, in particular the quality of services being jeopardized as a potential outcome of downsizing; and

(ii)(October 6, 1999) from Mr. Brian Cochrane, President, Toronto Civic Employees' Union, Local 416, in opposition to the selection of EMA Canada Inc. to assist the City with the implementation of the Works Best Practices Program; recommending that if the City must continue with the Program, the changes be made using City employees on an "in-house" basis; and further recommending that if the Committee approves the recommendation to retain EMA Canada Inc., EMA be directed to proceed in a manner that recognizes Local 416 as having an integral role in any operational changes.

The following persons appeared before the Works Committee in connection with the foregoing matter:

-Mr. Peter Leiss, Executive Vice-President, and Ms. Gina Gignac, Toronto Civic Employees' Union, Local 416; and

-Ms. Karen Buck, Toronto, Ontario.