April 27, 2001

CH2M-Hill to Provide Water Quality Improvements, Saves $50 Million
through Design-Build-Operate Model

City of Seattle to Sign Deal to Build Cedar Treatment Facility

SEATTLE – A contract to design, build and operate a facility for treatment of drinking water from the Cedar River will improve water quality and save ratepayers millions of dollars because of the unique contracting approach used.

The Seattle City Council is expected to approve the deal on Monday. Following Council approval, Seattle Mayor Paul Schell is set to authorize Seattle Public Utilities (SPU) to sign the contract with CH2M HILL Constructors, Incorporated. A special signing ceremony is scheduled in the Mayor’s Conference Room in the Municipal Building, 600 Fourth Avenue, 12th Floor, at 4:30 p.m. Monday, April 30.

"The new Cedar Treatment Facility will meet strict water quality standards and provide new, improved treatment facilities that will assure high quality and reliable water for many years to come," Schell said. "What’s more, having the same contractor design, build and operate the facility will save ratepayers an estimated $50 million over the life of the contract."

The new Cedar Treatment Facility will feature a state-of-the-art ozonation and ultraviolet (U.V.) light process to disinfect Cedar River water, which supplies 70 percent of the drinking water to Seattle and suburban water utilities. It will be capable of disinfecting 180 million gallons of water per day and if in operation today, would be the largest UV water treatment facility in the world. The treatment process will ensure the water supply meets or exceeds current and expected new federal water quality standards. The facility is expected to be operational by the end of the year 2004 and will cost $109 million dollars to design, build and operate for 25 years. A groundbreaking is expected in spring of 2002.

Using the design-build-operate (DBO) contracting approach for the Cedar facility is saving money relative to using a conventional design-bid-build approach by allowing the contractor to customize the design and construction of the facility to fit the site, regulatory requirements and treatment methods developed, resulting in lower construction and operating costs, increased overall efficiency and improved schedule.

SPU first used the DBO contracting approach for the Tolt Treatment Facility in the Tolt River Watershed, which supplies 30 percent of the drinking water to the Seattle metropolitan area. The new Tolt facility began operations in December last year.

"The Tolt DBO project saved the City about $70 million when compared to the cost of implementing the project using a conventional design-bid-build procurement," said Diana Gale, SPU managing director. "The DBO approach is becoming popular in the industry as a way to improve efficiency, increase reliability and significantly cut down on project costs," she added.

The prime contractor for the Cedar Treatment Facility, CH2M HILL, is an employee-owned, full-service project delivery firm that has been providing services within the Seattle area since the 1950s. M.A. Mortenson Construction Company, which has constructed numerous large public works facilities in Washington and nationally, will be a major partner with CH2M HILL on the construction phase services as part of a consortium including several other highly-qualified specialty contractors.. The CH2M HILL team has also committed to subcontract significant construction work to local small business enterprises in support of the City of Seattle’s Boost Program and as an extension of long-term focus by CH2M HILL on the value of such activity.

CH2M HILL’s operations arm, Operations Management International, Incorporated (OMI), will operate and maintain the facility for up to 25 years.

"CH2M HILL and OMI have developed a progressive Quality Program as a foundation that will be embraced in all phases of the contract, including the long-term operations contract," said Don S. Evans, senior vice president of CH2M HILL.

The Quality Program developed for the project has benefited from OMI’s Obsessed with Quality business maxim. This focus resulted in OMI receiving the highest-level quality award given in the United States, the Malcolm Baldrige National Quality Award, which was presented by President Bush this month. OMI is the first-ever recipient from the water industry.

For more information, visit www.cityofseattle.net/util/ and click on "Projects and Planning."

Contacts: Sheila Strehle, (206) 684-7688
Seattle Public Utilities, Media Relations

Elizabeth S. Kelly, (206) 386-9779

Seattle Public Utilities, program manager for Cedar and Tolt facilities

CH2M HILL, project director: Bob Chapman, (425) 453-5000