Partnership Saves Indianapolis $24 Million
As the largest project of its kind in the country, the public/private partnership running the Indianapolis wastewater treatment facilities has defied its national and local skeptics and is successfully meeting all its contract requirements while producing effluent quality equal to or better than that of the previous city operation.
Two years into the five-year agreement, the White River Environmental Partnership (WREP) has saved the city more than $24 million formerly budgeted to the AWT facilities.
Those funds were redirected back into spending for infrastructure repair and resolution of combined sewer overflow problems.
The 33 percent sewer fee rate hike contemplated in 1993 has never materialized due to the decrease in AWT annual operating costs.
Indianapolis is served by two 125 mgd wastewater treatment facilities, each with a design capacity of 150 mgd. Built in the mid-80s, the facilities were considered to be well run by the city and received several national awards. Nonetheless, with an annual budget of more than $30 million, the facilities were targeted for potential efficiency measures.
The city selected contract operations and maintenance over other private sector competitive options after realizing that selling the facilities (valued at $280 million to $300 million) outright was a most unlikely scenario.
An 18 month research gathering period, which included technical and financial evaluations, estimated roughly 5 percent savings could be realized by contracting out the AWT services. Over a two-year period those savings have reached nearly 40 percent and are ahead of the original contract projections of $65 million over five years.
The WREP partnership includes IWC Resources, the holding company of the Indianapolis Water Company; JMM Operational Services, an environmental engineering firm in Denver; and Lyonnaise des Eaux, a French utilities firm that specializes in water and wastewater operations.
Water quality has improved under the private management of the plant, with a 50 percent decrease in permit exceedances. The American Metropolitan Sewerage Association (AMSA) has presented two gold awards and one silver award to the plants for outstanding operation in the past two years.
The problem of raw sewage over flows on the river, a major concern of area environmentalists, has also lessened as a result of operational changes that have increased plant capacity without new capital improvements.
Local environmental groups meet regularly with WREP management to discuss plant performance and have given the partnership high marks on environmental issues.
AFSCME Local 725 originally opposed the contract management and filed suit to prohibit the contract from being enforced. But now, the union has teamed with WREP on new business proposals for the company.
Joining the union's strengths and WREP's expertise has improved morale for workers and ensured a solid communications upon which to build.
WREP employees are receiving better pay and benefits, including additional bonuses, hauling opportunities and expanded retirement plans, than were the former city workers.
Voluntary assignments to Australia, France and throughout the United States have allowed the staff to share their expertise with a number of other partnership projects as well as to return to Indianapolis armed with additional experience.
Safety and training remains a major goal of WREP with 4,657 man-hours of training conducted in 1995.
A newly created safety committee meets monthly to review plant conditions and evaluate existing plant standards. Bi-weekly tailgate safety meetings provide detailed information to all employees on a regular basis.
As a result of the increased focus on safety, the accident rate at both of the plants has decreased more than 80 percent in two years. The Indiana Water Pollution Control Association has presented WREP its annual Safety Award for 1995 in recognition of its safety efforts.
The business philosophy of the partnership has also been parlayed into major changes for the AWT accounting and warehousing systems. A new maintenance manager system tracks inventory and work orders with greater specificity, providing updated information and project accountability. Dunn and Bradstreet's recent pay-DEX rating of 82 places WREP in the top 98 percent of all business for prompt turnaround of invoices and payments to vendors.
While WREP's contract lists a goal of 12 percent participation for minority-owned business and women-owned businesses, 1995 performance showed 22.7 percent of all purchases were made from MBE/WBEs.
In fact, both the Indianapolis Black Chamber of Commerce and the Indiana Regional Minority Supplier Development Council have presented awards to WREP for its outstanding MBE/WBE participation.
More than 2,000 people have toured the facilities in an effort to learn about the accomplishments and changes that have continued to keep Indianapolis in the forefront of wastewater operations.
WREP will continue to meet the challenges of media scrutiny and the anti-competition forces with industry-standard operations and innovative solutions, while providing the citizens of Indianapolis with better service at a greatly reduced cost to taxpayers.
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