Agenda Item - 2023-04-04 - Number 09.1 - Wastewater Treatment Facility Project Update 9.1
COUNCIL REPORT
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OREGOCa/
Subject: Lake Oswego Wastewater Treatment Facility Project with EPCOR Foothills Water
Project, Inc. (EFWP)
Meeting Date: April 4, 2023 Staff Member: Anthony Hooper, Deputy City Manager
Report Date: March 30, 2023 Department: City Manager's Office
Action Required Advisory Board/Commission Recommendation
❑X Motion ❑ Approval
❑ Public Hearing ❑ Denial
❑ Ordinance ❑ None Forwarded
❑ Resolution ❑X Not Applicable
❑ Information Only Comments:
❑ Council Direction
❑ Consent Agenda
Staff Recommendation: Approve Amendment No.1; Authorize $1,026,000 of Additional
Consultant Spending; Authorize the City Manager to sign amendments for legal, engineering,
and property acquisition/relocation services.
Recommended Language for Motion: Move to approve Amendment No.1 to the Preliminary
Services Agreement with EPCOR Foothills Water Project Inc.; Authorize $1,026,000 of
Additional Consultant Spending; and Authorize the City Manager to Sign an Amendment to
three contracts: $280,000 with Hawkins, Delafield, and Wood, $466,000 with Carollo
Engineering, and $60,000 with Universal Field Services.
Project/ Issue Relates To: Collaborate with the City of Portland to make a financially and
environmentally responsible long-term investment in a wastewater treatment plant.
Issue before Council (Highlight Policy Question):
❑X Council Goals/Priorities ❑Adopted Master Plan(s) ❑Not Applicable
ISSUE BEFORE COUNCIL
Shall the City Council amend the preliminary services agreement with EPCOR Foothills Water
Partners (EFWP) to advance the project to a 90% design level and to extend the date of the
Go/No Go decision for the 30-year Project Agreement, in order to reduce contingencies and
risks, and delay locking in interest rates?
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BACKGROUND
The existing Tryon Creek Wastewater Treatment Plant (TCWTP) was built in 1964 and is owned
and operated by the Portland Bureau of Environmental Services (BES). The plant is reaching the
end of its useful life cycle and needs to be upgraded or replaced.
Since 2018, the cities of Lake Oswego and Portland have been actively exploring the option of a
new wastewater treatment facility to replace the existing plant under a public-private
partnership. On May 4, 2021, the City entered into a Preliminary Services Agreement (PSA) for
the Design, Build, Finance, Operate and Maintenance (DBFOM) of a new plant with EFWP. The
preliminary services phase was originally intended to develop designs to the 60% phase,
advance permitting, scope costs, develop schedule, and complete archeological and
environmental studies (referred to as Tasks 1-4 in the PSA).
The following diagram outlines the anticipated project timeline that will be further developed
during the 60%to 90% design phase.
April 4,2023:Amend January 2024:
Preliminary Services "Go/No Go" Decision
Agreement with & IGA with Portland
EPCOR Foothills Water
Project Inc.(EFWP)
Off-Ramp?
Desk
Basis of Design Design I (9446)f
Design (30%i W I Definitive ,
work Rnal Design
OW
Submittal co{°gr' EPCOR Operates
Cost Development and Maintains
a•1m,rnnr Treatment Facility
schedule°eveba +ent ! for 30-years
Negotiate Final Agreement
IFtrtRn[iat Vese Construction Testing and service Period
Commissioning (O&M)Preliminary Spey Property Acquisition
}fir uisitlon&Relocation &location
Preliminary Services Agreement ; --PA(C&M Phase)--
May 2021—April 2023 April2023— Spring/Summer 2024— Fall/Winter 2027—
I Jan. 2024 Fall/Winter 2027 Fall/Winter 2057
r Jan. 2024—April 2024: Fall 2027—Fall 2029:
Approval and 30-day Procurement, Planning,
I Enactment of IGA and Project Demolishing and Re mediating
Agreement with EFWP by Existing Tryon Creek
Portland City Council Wastewater Treatment Plant
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Lastly, there are a number of benefits to building a new facility.
Best Financially State-of-the-Art
Long-term Wastewater Treatment
A new,state-of-the-art wastewater
treatment facility will produce
cleaner water and ensure more
environmentally sustainable services
at a similar cost to upgrading the
existing aging facility.
More Environmentally Neighborhood
Sustainable Friendly
DISCUSSION
The principal question for the Council is whether to approve an amendment to the existing PSA
with EFWP for one year to advance design and engineering to 90% completion. If yes, to
support the next year of work, staff recommends the Council authorize an additional
$1,026,000 in consultant spending for legal services with Hawkins, Delafield, and Wood,
engineering services with Carollo Engineers, and land acquisition/relocation services with
Universal Field Services.
In December 2022, staff recommended that the City extend the work under the PSA with EFWP
for one year. During this time, EFWP will advance designs to a 90% level and complete a
number of deliverables. City staff has reached a recommended form of agreement with EFWP
to amend the PSA.
The project has evolved significantly over the last three months.
Interest Rates, Borrowing Costs, and Inflation
Previously, the project schedule anticipated the Council making a decision in December 2022
whether to enter into a DBFOM Project Agreement for 30 years, and thereby locking in interest
rates. However, inflation and interest costs are currently high, which would have added
significant costs to the project both during construction and over its 30-year life because of how
higher interest rates affect borrowing costs. Rather than locking in rates now, staff is
recommending that the Council amend the PSA to finish engineering and design by April 2024,
and thereby delay locking in interest rates at this time.
There are multiple benefits to continuing the design phase and delaying locking in interest
rates. First, EPCOR and the City can continue to refine the project and the costs over the next 9
months, which could lead to further project cost savings. As the design develops, contingencies
should decrease, reducing risk for both parties. Second, it will take about 9 months to go from
60%to 90% designs, which would still be needed if the "go/no go" decision occurred in
December 2022 as originally planned.
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Third, most economists are forecasting that inflation will cool later in 2023, which will likely
lead to decreases in interest rates. Some economists are also forecasting a recession, in which
case construction costs may also fall. The reason that a recession looks like a strong possibility
is because the bond markets' inverted yield difference between the 3-month Treasury Bills
(T-Bills) and the 18-month T-Bills. In translation, the bond market is offering a much higher rate
of return for a 3-month T-Bill than the 18-month T-Bill even though money would be locked up
a lot longer. This difference was -134 basis points as of March 23, 2023, a record (the previous
record was set in 2001,just three months ahead of a recession).
New Structure of the Long-Term Deal with EFWP
Under the original concept of the project, EFWP would design, build, finance, and operate the
new wastewater treatment plant. However, the total cost of that concept has exceeded the
"affordability cap" for the project, and would require both cities to increase their financial
commitment. In analyzing the project costs, the staff of Lake Oswego and Portland have
concluded that it is too expensive to have EFWP privately finance the debt for the plant.
Accordingly, staff of both cities recommend replacing the EFWP's bank private placement
money with public financing through a Full-Faith and Credit (FF&C) bond, which accounts for
31% of the design-build (construction) costs.
In addition, the City would transfer the Environmental Protection Agency Wastewater
Infrastructure Finance and Innovation Act (WIFIA) loan from EFWP to the City. Staff anticipates
seeking WIFIA approval in April. The WIFIA loan accounts for 49% of the design-build costs, and
this financial tool is very cost effective and flexible. Lake Oswego was fortunate to be one of
only four Oregon cities for that cycle that received this highly-sought after loan eligibility
determination in December 2021.
Lastly, the financing of the project anticipates including EFWP's equity for remaining 20% of the
design-build costs. EFWP's equity component is important to the project. EPCOR, the parent
entity of EFWP, only does public-private partnership projects that have equity involved. From a
City-standpoint, EPCOR's equity provides incentives for EFWP to design, build, operate, and
maintain the new plant in an efficient and long-lasting way so as to get a dependable return-on-
investment.
Project Costs
The total project costs were estimated at $767.9 million in December 2022. Through the
change in financing, and other efficiencies, the estimate is now $613.1 million.
Projected Rate Impacts
In March 2023, the City had the rate modeling expert at FCS utilize preliminary cost projections
to determine whether the previous benchmark of 3.9% annual rate increases would be
adequate for the current $613.1 million project estimate, given that public money is being
utilized and debt coverage ratios will need to be met for possible bond issuances. Based on
their evaluation, rate increases within the projected 3.9% benchmark are possible for the
wastewater treatment facility project; however, staff stresses that there will be more cost
development needed for any future rate increase estimate. Additionally, there are several
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years over the life cycle of the project where the share of payments between Lake Oswego and
Portland may need to be adjusted to ensure that each jurisdiction can manage within its rate
structure.
As a caveat, the 3.9% benchmark of rate increases are only tied to this project, and there could
be a need for rate increase rates in the future so as to improve wastewater pipe, pump station,
or other wastewater system needs that are independent of this project.
The Status Quo Option of Upgrading the Tryon Creek Plant
The total project cost estimate in 2020 for Portland to upgrade the existing 1964 Tryon Creek
plant and operate the plant for 30 years was $691.5 million. In 2023 dollars and with fully
upgraded costs to "like new" condition, Portland staff estimate that a full investment of the
existing plant with 30 years of operation and maintenance, plus financing, would cost
approximately $1 billion. Therefore, the total projected estimated cost of$613.1 million for the
new plant is anticipated to be significantly less than the cost to fully upgrade the existing Tryon
Creek Plant.
There are some nuances to Portland's 30-year$1 billion estimate. First, uncertainty exists as to
what Lake Oswego's percentage share of the cost of future capital upgrades would be. The
current 1984 IGA for the Tryon Creek Plant provides that Lake Oswego would pay 50% of all
capital costs; Portland's Bureau of Environmental Services (BES) staff strongly believe that Lake
Oswego should pay 70% of the capital costs based on the relative proportion of total flows to
the Tryon Creek Plant. The uncertainty for the cost sharing is based on a capacity versus flow
disparity as Lake Oswego is using 50% of its dry weather flow capacity and Portland does not
use all of its capacity.
In addition, the 1984 IGA can be terminated by Portland in 2034 with 5-years of advance notice.
The Interim IGA (negotiated with Portland as a part of this project) provides that Lake Oswego
and Portland would open negotiations on the 1984 IGA for a long-term Replacement IGA if the
status quo is selected over Lake Oswego building a new plant because Portland doesn't want to
make long-term investments without knowing the percentage share of costs between cities.
Another nuance is that not all of the upgrades would happen at the same time. The capital
upgrades would be split over 30-years, which would lessen the impact to wastewater rates as
compared to building a new plant all at once. However, operational efficiencies and
environmental benefits can be realized much earlier by building a new plant versus a piece-
meal approach.
Moreover, when the 2014 Tyron Creek Facilities Master Plan was completed, Portland signaled
that they would allow Lake Oswego to pay for the upgrades with a gradual ramp up over many
years, so as to mitigate impacts to rates. Portland also depreciated assets over long periods of
time (up to 50 years), and charged Lake Oswego based on the depreciation schedule, which
allowed for the payments from Lake Oswego to be further phased in over time. Portland has
indicated through its support and financial phasing of the project in the First Amendment of the
Interim IGA, that, although obviously different, Portland's payment structure would have the
same effect in facilitating financial advancement of the project.
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Bond Issuances
If the project through EFWP continues, the City will need two Full Faith & Credit Bond (FF&C)
Bond Issuances: one for land acquisition and remediation and one for 31% of the design-build
cost for the project. The combined bond issuances are anticipated at $74.6 million.
FF&C means that the City will secure the bond against the City's General Fund Reserve Account
instead of the alternative of doing a Revenue Bond. The FF&C Bond will have a lower interest
rate than a Revenue Bond and will therefore lower the project cost.
Need to Raise Debt Limit
In order to allow the two FF&C bond issuances to occur, the City Council will need to raise the
City's existing debt limit. In 2014, the Budget Committee recommended adopting a debt limit.
The City Council subsequently voted to adopt a cap of non-general obligation debt at $250
million, which was based on known needs at the time. As an aside, a debt limit did not exist
until 2014. In 2014, the Wastewater Treatment Plant was envisioned to be upgraded by the
Portland City Council without any debt to the City of Lake Oswego. As a customer of the
TCWTP, the City's payments are in the form of user fees.
It is worth noting that only a few cities in Oregon have voluntarily instituted a debt limit. The
City Council can change or eliminate the debt limit with a majority vote.
The existing debt that counts against limitation is approximately$208.8 million, which leaves
$41.2 million under the limitation. There is no bonded indebtedness that is anticipated to drop
off in the near future as the oldest one is from 2011 and the bonds are all at least 20-years in
length. Staff estimates at this time that the City will need to issue $74.6 million in FF&C bonds
to allow the project to move forward with the new financing structure that would be proposed
under the future Project Agreement. Therefore, the new debt limit would need to be at least
$283.4 million. However, there is also a new public accounting rule that will go into effect on
January 1, 2024 that will count the WIFIA loan against any existing debt limitation, whether it is
held by EPCOR or by the City. With this in mind, the new debt limit would need to be raised by
an additional $90.6 million, which would bring the new debt limitation to $374 million.
Staff will need to make sure that there is no other non-general obligation debt that is
anticipated by any other department in the near future prior to requesting that the Council
increase the debt limit.
Preliminary Services Agreement Amendment No. 1 Details
The key details of the proposed PSA Amendment (Attachment 1) with EFWP are as follows:
• The following deliverables will be completed for not-to-exceed $3,103,002 (entitled Task
5), with work paid on a monthly basis according to invoiced hours and rates:
o Technical Deliverable Material to 90% completion (Design Drawings & Specs)
o Aqua-Aerobic Design Completed
o Submitting Permitting Applications
o Extending Archeological Investigation &Assessment
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o Finalizing a Solar Study
o Completing an updated Environmental Assessment
o Providing Cost Estimating
o Updating the Management Plan
o Completing a Hazardous Building Material Survey and Demolition Permit
Application
o Submitting a Final Project Submittal
The Task 5 work will take 220-days with a 45-day review period for the cities and a re-
submission period of additional 15 days (if needed). The cumulative period is a little
over 9 months.
The invoiced amount for the deliverables will not exceed 90% of the $3,103,002; 10% is
held back as a type of retainage payable upon completion and City staff review of
reasonableness of charges and completeness.
• For the 60% design and other preliminary services already performed (Tasks 1-4), EFWP
has expended $7,171,092.12. The City will pay EFWP on a monthly basis an amount
equal to the U.S. Bank prime rate each month on the $7,171,092.12 of previously
completed Tasks 1-4.
As of March 27, the prime rate was 8%, and if this held constant, then the estimated
cost of having EFWP carry this cost would be $47,807 per month or about $574,000 for
12 months in total interest payments. The City anticipates reimbursing EFWP for the
$7,171,092.12 in the summer of 2024 with a portion of the City's bond issuance,
pending Council approval of the 30-year DBFOM Project Agreement.
• Reimburse EFWP for an additional $385,651 in design and engineering costs to re-orient
the Facility as a way to shorten the construction period. This will be paid as either with
Breakage Fee (in the event the PSA is terminated after EFWP completes all deliverables)
or as part of the payments due under the Project Agreement (if the City approves a
Project Agreement with EFWP).
• Reimburse EFWP for up to $22,500 in travel cost for Task 5 services, so long as those
costs are pre-approved by the City.
• The City is responsible for paying the EPA for all remaining WIFIA costs, which are
anticipated to be about $200,000.
• EFWP will submit a Final Project Submittal price at the end of the Task 5 period and will
hold pricing for a period of 140 days, providing time for the Go/No Go decision by Lake
Oswego and Portland.
Funding Authorization and Contract Amendments
Staff requests the Council authorize $1,026,000 of consultant spending over the course of one
year (Attachment 2). This is the amount needed to get to the pre-construction phase, which is
anticipated to begin in April 2024 should the Project Agreement with EFWP be approved. The
funding authorization assumes monthly spending of about $86,000 per month for 12 months.
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There are four consultants and all of them require an amendment to their existing contracts to
allow work to continue into this next phase. Not all of the contracts have been fully expended,
so the contract amendments will not add up to the funding authorization amount exactly. The
recommended contract amendments are as follows:
• Legal: Hawkins, Delafield, & Wood for an additional $280,000, for a new not-to-exceed
(NTE) total of$1,339,000.
• Engineering: Carollo Engineers for an additional $466,000, for a new NTE total of
$1,329,000.
• Owner's Representative: Illuminati Infrastructure Advisors (Jill Jamieson) — no change
to the total; however, an amendment for time will be needed to extend the contract
from December 31, 2023 to April 30, 2024.
• Property Acquisition/Relocation: Universal Field Services for an additional $60,000, for
a new NTE total of$228,000.
The request is to authorize the City Manager to sign these amendments for the not-to-exceed
amounts for each of those three contracts.
FISCAL IMPACT
The costs contained within Amendment No.1 of the Preliminary Services Agreement, which will
be funded out of the Wastewater Fund, are as follows:
Items Cost Portland's Share to LO's Share
Be Reimbursed* (69.61%)
(30.39%)
EFWP to advance engineering and design to
90% level and complete other deliverables on $3,103,000 $943,000 $2,160,000
Not-to-Exceed (NTE) basis
Interest Payments for =$48,000 per month to
EFWP for carrying $7,171,092.12 of out-of-
pocket expenses needed to get to 60% design $576,000 $175,000 $401,000
for 12 months
NTE Travel Costs for EFWP Over the Next Year $22,500 $7,000 $15,500
Projected Closing Costs for Water Infrastructure
and Finance Innovation Act (WIFIA) Loan $150,000 $46,000 $104,500
Estimated Consultant Costs for One Year (NTE) $1,026,000 $312,000 $714,000
Design and engineering costs to re-orient the
site as a cost saving measure that was paid out- $385,500 $117,000 $268,000
of-pocket by EFWP (likely funded by WIFIA loan)
$5,263,000 $1,600,000 $3,663,000
*Portland and LO's share of costs assumes there will be a long-term project to build a new plant
and is based on anticipated share of flows to the new plant. If a long-term project doesn't
proceed, then Portland share of the above costs will go from 30.39% up to 50%.
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ATTACHMENTS
1. Amendment No. 1 to the Preliminary Services Agreement for the Development of the
Lake Oswego Wastewater Treatment Facility
2. Consultant Spending Table
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ATTACHMENT 1
FINAL 3/26/2023
AMENDMENT NO. 1
TO THE
PRELIMINARY SERVICES AGREEMENT
FOR THE DEVELOPMENT OF THE
LAKE OSWEGO WASTEWATER TREATMENT FACILITY
THIS AMENDMENT NO. 1 TO THE PRELIMINARY SERVICES AGREEMENT FOR
THE DEVELOPMENT OF THE LAKE OSWEGO WASTEWATER TREATMENT FACILITY (this
"First Amendment") is entered into as of April [_I, 2023, between the City of Lake Oswego,
Oregon(the"City"), and EPCOR Foothills Water Project Inc., a corporation organized and existing
under the laws of the State of Delaware and authorized to do business in the State of Oregon
formerly known as EPCOR Foothills Water Project LLC (the "Project Company").
RECITALS
WHEREAS, the City and the Project Company executed and delivered the
Preliminary Services Agreement for the Development of the Lake Oswego Wastewater Treatment
Facility, dated May 5, 2021 (the "Preliminary Services Agreement");
WHEREAS, the parties desire to amend the Preliminary Services Agreement to add
additional preliminary services to the Project Company's work scope and extend the term of the
Preliminary Services Agreement, so that the City may further advance Project Site acquisition
work and the Project Company may further advance design and permitting efforts to reduce
pricing contingency before establishing definitive final pricing - all pursuant to Section 3.2
(Changes to the Scope of Services) of the Preliminary Services Agreement; and
WHEREAS, both the City and the Project Company agree that it is in their mutual
interests to amend the Preliminary Services Agreement to memorialize the agreed upon changes.
NOW THEREFORE, in consideration of the mutual covenants herein contained,
the parties hereto, intending to be legally bound, agree as follows:
SECTION 1. DEFINITIONS. All capitalized terms used and not otherwise
defined herein shall have the meanings set forth in the Preliminary Services Agreement.
SECTION 2. INTERPRETATION. The interpretation provisions set forth in
Section 1.2 (Interpretation) of the Preliminary Services Agreement, will apply to any
interpretation of this First Amendment.
SECTION 3. MODIFIED PRELIMINARY SERVICES AGREEMENT PROVISIONS.
1. In Section 1.1 (Definitions) of the Preliminary Services Agreement, the definition of
Additional Services is hereby amended and restated in its entirety to read as follows:
"Additional Services" means those services that are in addition to the Basic
Services, as described in subsection 3.2(B) (Additional Services), and shall include
those services set forth in Attachment 1F (Additional Preliminary Services) to the
Preliminary Services Agreement.
2. In Section 1.1 (Definitions) of the Preliminary Services Agreement add the following
defined term:
"First Amendment" means Amendment No. 1 to the Preliminary Services
Agreement for the Development of the Lake Oswego Wastewater Treatment Plant,
dated April [_I, 2023, between the City and the Project Company.
3. In Section 1.1 (Definitions) of the Preliminary Services Agreement, the definition of
"Preliminary Services Fee" is hereby amended and restated in its entirety to read as follows:
"Preliminary Services Fee" means $7,171,092.12, the amount representing the
cost of the Preliminary Services through the date of this First Amendment
(including any associated financing costs of the Preliminary Services) (1) to be paid
by the City to the Project Company pursuant to the Project Agreement, if the
parties execute a Project Agreement; or (2) to be the basis of the determination of
the Breakage Fee in the event the parties do not execute the Project Agreement,
as such amount may be adjusted in accordance with the terms of this Agreement.
The Preliminary Services Fee does not, however, include compensation for any of
the Additional Services described in Attachment 1F (Additional Preliminary
Services), which shall be invoiced by the Project Company and paid by the City on
a monthly basis pursuant to Section 4.4 (Special Compensation Provisions for
Additional Preliminary Services).
4. In Section 1.1 (Definitions) of the Preliminary Services Agreement, the definition of"Task'
is hereby amended and restated in its entirety to read as follows:
"Task" means each of the tasks set forth in Appendix 1 (Scope of Basic Services).
5. In Section 1.1 (Definitions) of the Preliminary Services Agreement, the definition of"Term"
is hereby amended and restated in its entirety to read as follows:
"Term" means the period from the Agreement Date to the later of (1) the
completion of the Preliminary Services including the Additional Services described
in Attachment 1F (Additional Preliminary Services), or (2) 365 days following the
date of the First Amendment, unless either terminated or off-ramped in
accordance herewith or extended by mutual agreement of the parties in both
parties discretion.
6. Add the following as a new Section 3.1(C) (Task 5 Notice to Proceed) to the Preliminary
Services Agreement:
(C) Notice to Proceed with Task 5. As of the date of the First Amendment, the
Project Company is hereby authorized to proceed with the performance of the Task
5 services described in Attachment 1F (Additional Preliminary Services) and shall
complete the same within the time periods set forth in Exhibit B (Work Schedule)
of this First Amendment unless such period is extended by mutual agreement of
the parties. For clarity, the parties acknowledge and agree that the Project
Company is no longer responsible to obtain committed debt financing for the
Project, which responsibility (including payments to EPA for WIFIA Loan costs)
has been assumed by the City. The Project Company shall also complete any
outstanding incomplete Preliminary Services described in Tasks 1-4 in Appendix
1 (Scope of Basic Services) other than debt financing related tasks reasonably
identified by the City, and the Project Company shall arrange its work on the
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incomplete Preliminary Services as needed to commence and continue the work
under Task 5.
7. Section 4.2 (Compensation to the Project Company for Preliminary Services) of the
Preliminary Services Agreement is hereby amended and restated in its entirety to read as follows:
SECTION 4.2. COMPENSATION TO THE PROJECT COMPANY FOR PRELIMINARY
SERVICES. Except as provided in Section 4.4 (Special Compensation Provisions
for Additional Preliminary Services) and Section 4.5 (Compensation for Extended
Carry), the Project Company will not be paid for Preliminary Services on a current
basis. The Project Company shall be compensated for Preliminary Services
through either (1) payment by the City of a Breakage Fee in accordance with
Appendix 2 (Compensation) in the event this Agreement is terminated or the City
exercises its option to off-ramp after the Project Company completes all
Preliminary Services; or (2) if the parties execute the Project Agreement, the
Preliminary Services Fee shall be paid to the Project Company pursuant to the
Project Agreement. In addition, if the parties execute a Project Agreement, the
City will compensate the Project Company for direct costs incurred to perform the
Preliminary Services relating to certain aspects of the re-orientation of the Facility
on the Facility Site which costs are equal to $385,651.00; and may compensate
the Project Company for costs incurred for design-build activities and other
activities in furtherance of the Project not specifically identified in Tasks 1-4 in
Appendix 1 (Scope of Basic Services) or in Task 5 to the extent such costs are
approved by the City in its sole discretion (collectively, the "At-Risk Costs"), which
amounts shall not be subject to markup. For the avoidance of doubt, At-Risk
Costs will not be payable by the City in the event this Agreement is terminated for
any reason other than execution of the Project Agreement, or the City exercises
its option to off-ramp. Except as provided in Section 4.4 (Special Compensation
Provisions for Additional Preliminary Services) and Section 4.5 (Compensation for
Extended Carry), any Additional Services shall be incurred and compensated in
the same manner as Basic Services (unless otherwise agreed to by the parties)
provided that the Preliminary Services Fee and Work Schedule shall be adjusted
in accordance with subsection 3.2(B) (Additional Services).
8. Add the following as a new Section 4.4 (Special Compensation Provisions for Additional
Preliminary Services) to the Preliminary Services Agreement:
SECTION 4.4. SPECIAL COMPENSATION PROVISIONS FOR ADDITIONAL
PRELIMINARY SERVICES.
(A) Monthly Payments; Not-to-Exceed Amount. Notwithstanding any other
provision in this Article 4 (Compensation) or elsewhere in this Agreement, the City
shall compensate the Project Company for Task 5 services set forth in Attachment
1F (Additional Preliminary Services) based upon the time and reimbursable
expenses reasonably incurred by the Project Company in the performance of such
Task 5 services performed after the Effective Date of this First Amendment in the
manner and subject to the terms and conditions set forth in this Section and
Attachment 1F (Additional Preliminary Services). The City's compensation to the
Project Company for the performance of Task 5, including any reimbursable
expenses set forth in paragraph (E) below, shall not exceed a total of
$3,103,002.00, unless otherwise agreed in writing by the parties. The Project
Company shall not be entitled to compensation for such Task 5 services in excess
of the not-to-exceed amount established in this Section unless otherwise agreed
in writing by the parties, and in no event shall such amount be construed to entitle
the Project Company to such amount as minimum compensation for performance
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of the services described in Attachment 1F (Additional Preliminary Services) with
respect to Task 5. Any payment obligation of the City to the Project Company in
the performance of Task 5 shall be further subject to the additional requirements
set forth in this Section.
(B) Invoices and Payment. The Project Company shall provide the City with
an invoice for the performance of the Additional Services after the Effective Date
of this First Amendment on a monthly basis in a format reasonably acceptable to
the City but at a minimum each invoice shall state the work performed during
such invoice period and shall include a breakdown of the hours billed by each
person by name and title and the corresponding work performed by each such
person and the billing rate for such person which rate shall be consistent with the
rates set forth in Attachment 1F (Additional Preliminary Services). The invoice
shall also include the amount of carrying costs authorized to be charged to the
City pursuant to new Section 4.5 (Compensation for Extended Carry) of the
Preliminary Services Agreement and the calculation of such amount. Subject to
subsection (C) (Disputed Amounts) of this Section, the City shall pay such invoice
in a reasonable time, not to exceed 30 days (excluding holidays) following the
City's receipt of an invoice.
(C) Disputed Amounts. The City may in good faith, acting reasonably, dispute
any portion of a submitted invoice and withhold payment on such disputed
amounts until such time as the dispute is resolved in accordance with this
Agreement. Any such dispute will be raised within 90 days of receipt of the
relevant invoice. The City shall promptly pay Project Company the undisputed
amounts.
(D) Non-Compliant Services. Nothing contained in this Agreement shall
require the City to pay for any unsatisfactory or duplicative work or for work that
is not in compliance with the terms and conditions of this Agreement.
(E) Reimbursable Expenses. Expenses related to the Additional Services are
reimbursable to the Project Company to the extent such costs are: (i) pre-approved
by the City or costs associated with subcontractors performing part of the Task 5
scope of work to the extent identified as reimbursable in Task 5; (ii) actually paid
by the Project Company or its Subcontractors in the performance of the applicable
Additional Services; (iii) supported by receipts or other written evidence
reasonably acceptable to the City; (iv) not expenses described in subsection (F)
(Nonreimbursable Expenses) of this Section; and (v) with respect to travel
expenses only, such expenses do not exceed in the aggregate $22,500.00. All
reimbursable expenses shall be at the actual expense incurred by the Project
Company and its Subcontractors, without markup (except as otherwise provided
in subsection(F) below). Nothing in this subsection shall be construed as entitling
the Project Company to any Task 5 compensation or reimbursement in excess of
the Task 5 not-to-exceed amount established in subsection (A) (Monthly
Payments; Not-to-Exceed Amount) of this Section.
(F) Nonreimbursable Expenses. The Project Company acknowledges and
agrees that the hourly rates set forth in Attachment 1F (Additional Preliminary
Services) are "fully loaded"rates inclusive of any profit as well as any salary costs,
fringe benefits, payroll taxes, and general and administrative expenses (including
insurance) payable by the Project Company in performing the services described
in Attachment 1F (Additional Preliminary Services). Accordingly, such profit and
expenses shall not be separately reimbursable by the City to the Project Company.
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No expenses other than those set forth in paragraph (F) above shall be charged to
the City.
(G) Limitation on Invoices. Invoices for Task 5 described in Attachment 1F
(Additional Preliminary Services) prior to the final invoice relating to the final
deliverable shall not exceed 90% of the agreed upon not-to-exceed amount for
such Task.
9. Exhibit A to this First Amendment is hereby incorporated as the new Attachment 1 F
(Additional Preliminary Services) to Appendix 1 (Scope of Basic Services) to the Preliminary
Services Agreement.
10. Appendix 3 (Work Schedule) to the Preliminary Services Agreement is hereby deleted in
its entirety and replaced with the revised Appendix 3 (Work Schedule) set forth in Exhibit B
(Work Schedule) to this First Amendment.
11. Add the following as a new Section 4.5 (Compensation for Extended Carry) to the
Preliminary Services Agreement:
In consideration of the Project Company carrying the Preliminary Services costs
longer than originally anticipated, the City agrees to pay Project Company carrying
cost on the Preliminary Services Fee on a monthly basis following the date of the
First Amendment based upon an interest rate on the Preliminary Services Fee in
an amount equal to the U.S. Bank prime rate per month. Notwithstanding the
above, the City shall not be required to pay the carrying costs on the Preliminary
Services Fee during any period of delay caused by the Project Company's failure
to complete the Task 5 scope of work within the time periods set forth in Exhibit
B (Work Schedule) of this First Amendment.
SECTION 4. RESERVATION OF RIGHTS. The parties acknowledge that
notwithstanding the City's agreement to direct the Project Company to undertake Additional
Services pursuant to the terms of this First Amendment and to pay the Project Company for such
services, the City is in no manner waiving any rights that it has pursuant to the Agreement. In
no event will the passage of time associated with the negotiation and implementation of this First
Amendment result in a waiver or other impairment of the City's rights under the Agreement.
SECTION 5. ENTIRE AGREEMENT. This First Amendment contains the entire
agreement between the parties with respect to the specific changes noted above and supersedes
all oral negotiations and prior writings with respect thereto.
SECTION 6. INCONSISTENCIES AND CONFLICTS. The changes made by this
First Amendment are incorporated into the Preliminary Services Agreement and to the extent
provisions of this First Amendment are inconsistent with the provisions of the Preliminary
Services Agreement, the provisions of this First Amendment shall control.
SECTION 7. OTHER TERMS OF THE PRELIMINARY SERVICES AGREEMENT
REMAIN IN EFFECT. All terms and conditions of the Preliminary Services Agreement which are
not expressly modified or deleted by the terms of this First Amendment shall remain in effect.
SECTION 8. BINDING EFFECT. This First Amendment shall inure to the benefit
of, and shall be binding upon, the respective successors and assigns of the parties.
SECTION 9. NO REFERENCE REQUIRED. All notices, communications,
agreements, certificates, documents or other instruments executed and delivered after the
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execution and delivery of this First Amendment may refer to the Preliminary Services Agreement
without making specific reference to this First Amendment, but nevertheless all such references
shall include this First Amendment unless the context requires otherwise.
SECTION 10. COUNTERPARTS AND DELIVERY BY ELECTRONIC MAIL. This
First Amendment may be executed, manually or electronically, in counterparts, which together
shall constitute one and the same instrument. Any party may deliver an executed copy of this
First Amendment by electronic mail and such counterpart shall be deemed effective upon receipt.
[Signature Page Follows]
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IN WITNESS WHEREOF, the City and the Project Company have caused this First
Amendment to be executed in its name and on its behalf by its duly authorized officer as of the
date first above written.
EPCOR FOOTHILLS WATER PROJECT INC. CITY OF LAKE OSWEGO
By: By:
Printed Name: Daniel Bailet Printed Name: Martha Bennett
Title: Vice President Title: City Manager
APPROVED AS TO FORM:
By:
Printed Name: Evan Boone
Title: Deputy City Attorney
[Preliminary Services Agreement First Amendment Signature Page]
EXHIBIT A
APPENDIX 1
ATTACHMENT 1F
ADDITIONAL PRELIMINARY SERVICES
TASK 5 -
60% TO 90% DESIGN, SITE INVESTIGATION AND PERMITTING SERVICES AND PRICING
5.1. 90% Design Submittal Package
The Project Company shall take the Technical Deliverable Material to a point of 90% completion
of the overall final design. The process for meeting, conferring, and approving such submissions
shall proceed in the same manner as set forth in Task 3 provided that the number of meetings
shall be as set forth in Section 5.1.1(C) below. Technical Deliverable Material at the 90% level
will, as appropriate, contain further site investigations (including biological assessment, solar
study and archeological assessment, which require further investigation to finalize); final Project
layout and features; detailed design of Project features; detailed drawings and specifications;
design calculations (civil, electrical, mechanical, structural); and quality management reviews.
The revised Technical Deliverable Material will be reviewed by the City which will provide
comments back to Project Company. Project Company will then incorporate comments as
appropriate and mutually agreed to in order to finalize the 90% design submittal. The following
90% design drawings shall be developed to the approximate levels of completion as indicated:
(a) Cover Sheets (90% complete);
(b) General Drawings:
1. List of Drawings (100% complete);
2. Site plan (100% complete);
3. Drawing symbols, numbering & tagging conventions, symbols, and
abbreviations (100% complete);
4. Hydraulic profiles (100% complete);
5. Design criteria (100% complete);
6. Process flow diagrams (100% complete);
7. Pipe material schedule (100% complete);
8. Equipment schedule (100% complete);
9. Valve and gate schedules (90% complete); and
10. Boundary survey (100% complete).
(c) Civil Drawings:
1. General notes (90% complete);
2. Details (90% complete); and
3. Yard piping, paving, grading, and stormwater drawings (90%
complete).
(d) Structural Drawings: General notes, plans and sections (90% complete);
(e) Architectural Drawings:
1. General notes (90% complete);
2. Schedules (90% complete);
3. Code review drawings (90% complete);
4. Floor plans (100% complete);
5. Roof plans (90% complete);
6. Elevations (90% complete);
7. Reflected ceiling plans (90% complete);
8. Sections (90% complete); and
9. Details (90% complete).
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(f) Mechanical Drawings: Plans, sections, and details (90% complete);
(g) Plumbing, HVAC and Fire Protection Drawings: Schedules (90% complete);
Plumbing isometric drawings (90%complete); and Plans &details (90%complete);
(h) Electrical Drawings:
1. General notes, symbols, abbreviations (90% complete);
2. Main switchgear single line diagram (90% complete);
3. Load schedules (90% complete);
4. Panel schedules (90% complete);
5. Single line diagrams (90% complete);
6. Electrical distribution site plan (90% complete);
7. Project Facility electrical plans (90% complete);
8. Conduit plans (90% complete);
9. Grounding plans (90% complete); and
10. Lighting and receptacle plans (90% complete).
(i) Instrumentation: Legends and symbols (100% complete); Control system block
diagrams/network architecture (90%complete); and Process and instrumentation
diagrams (P&IDs) (90% complete);
(j) Security Drawings: Project Site plan (90% complete); and Equipment schedules
(90% complete); and
(k) The 90% design specifications shall be developed to the following approximate
levels of completion:
1. Table of contents (100%);
2. Identification of City standard Specifications and Project Company;
3. Specifications intended for use;
4. Major Equipment Specifications (100% complete);
5. Concrete Specifications (90% complete);
6. Piping and valve Specifications (90% complete);
7. Control narratives (90% complete); and
8. Balance of Specifications (90% complete).
(1) Provide 60% electrical site plan illustrating utility feed strategy based on
coordination with DEQ within 3 months after Task 5 notice to proceed.
5.1.1. Additional Requirements
The following additional requirements shall apply to the 90% design package and Technical
Deliverable Material:
(a) The Project Company shall provide to the City an electronic copy of the 90%
Technical Deliverable Material in both its native file format (i.e., MS Word; MS
Excel; AutoCADD; MicroStation, etc.) as well as Adobe PDF format.
(b) Technical Deliverable Material documents will be developed by Project Company
in 3D and associated 2D format. The 3D model(s) and associated 2D drawings will
be prepared in accordance with Project Company's CAD Standards Manual. A
complete set of 2D drawings will be developed from the 3D model(s). The 2D
drawings will contain, as a minimum, the following information:
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(i) Building architectural and structural plans, elevations, cross-sections and
other related sections and details, as appropriate to adequately describe
the work;
(ii) Plan views, cross-sections and other related sections, and details of
mechanical equipment;
(iii) Mechanical, electrical and I&C drawings that accurately depict required
building systems; and
(iv) Wiring diagrams and logic descriptions related to programmable logic
controllers (PLCs) and any remote input/output (RIO) racks proposed to
be installed.
(c) Project Company, City, and City's advisors will participate in up to five (5) 2-hour
design collaboration meetings held in person at the City offices or via conference
call.
(d) Prepare an update to the project permitting plan that addresses comments on the
latest version and considers updated timing/project schedule.
(e) The need for any subsequent modifications or development of the final design
beyond the 90% level will be determined by the City. If the City directs the Project
Company to advance the final design beyond the 90% level, the Project Company
shall be compensated for such advancement as an Additional Preliminary Service.
5.1.2. Site Investigations
The following Site Investigations will be completed as part of Task 5:
(a) Biological Assessment;
(b) Archeological Assessment;
(c) Solar Study;
(d) Additional survey at the river and bathymetry for the HRLO; and
(e) Phase 1 ESA (not necessarily needed but if not done again then new owner would
most likely not qualify for federal grant opportunities such as for clean-up
assistance if something is found).
5.1.3. Permitting Applications
The following permit applications will be submitted at or before completion of the 90% design as
agreed between Project Company and the City:
(a) Land Use Application;
(b) NPDES Permit;
(c) USACE/DSL/DEQ Joint permit application; and
(d) CLOMR-F application to FEMA (Necessary for WIFIA).
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(e) Demolition Permit; and
(I) Building Permit.
The City will pay application and other fees charged by the permitting agency associated with
the above permits. Note that site access is required for the Hazardous Building Material Survey,
which is an input into the Demolition Permit (item e). This will be dependent on the land
acquisition process by the City. Additionally, the Demolition Permit is a pre-requisite to the
Building Permit (item f).
5.1.4. Cost Submittal
Pursuant to Task 5.1(m), upon completion of the 90% design which includes the resolution of
comments from the City, Project Company shall prepare:
(a) An updated Design-Build Work cost, which shall be accompanied by appropriate
open-book pricing,with supporting documentation to include updated quantities,
and subcontractor/supplier quotes that are greater than 0.5%of the Project direct
costs;
(b) An updated compensation schedule specifying the proposed Capital Charge (for
each Contract Year) and Operations Charge Components;
(c) An updated Operation Services cost, which shall be accompanied by appropriate
open-book pricing supporting documentation and include updating quantities,
subcontractor and supplier quotes;
(d) If applicable and requested by the City, a list of any proposed allowance items,
alternate prices and unit prices; and
(e) A Financial Model Update using a Financial Model acceptable to the City.
The Capital Charge Component and proposed Operations Charge Component and the other
elements of Task 5 shall be based upon the risk allocation established in the Project Agreement.
5.1.5. Commercial Submittal
(a) Project Company will submit the Design-Build, Operations & Maintenance, and
Interface Agreement for the City's information;
(b) A guaranteed Scheduled Acceptance Date; and
(c) A critical path schedule for completing the Design-Build Work by the Scheduled
Acceptance Date and an accompanying maximum drawdown schedule.
5.1.6. Technical Submittal
(a) Technical Specifications to be incorporated into the Project Agreement;
(b) Acceptance standards, acceptance test procedures, to be incorporated into the
Project Agreement;
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(c) The final and complete list of required Governmental Approvals (recognizing that
the Project Company will be required to acquire all Governmental Approvals) for
the Project (including Governmental Approval application submittal dates and
assumed Governmental Approval issuance dates to be incorporated into the
Project Agreement;
(d) A description of any Change in Law that has occurred between the Agreement
Date and the date of the submittal of the Task 5 Technical Deliverable Material;
(e) An updated and finalized description of the Project Site;
(f) The O&M Plan including the major maintenance, repair and replacement
schedule; and
(g) Performance guarantees, as required by the Project Agreement.
5.1.7. Additional Information Submittal
(a) The names of proposed Subcontractors and descriptions of their roles for approval
by the City;
(b) A letter from a qualified surety confirming the intent of the surety to provide the
payment bond and performance bond required under the draft Project Agreement;
(c) A final equity, inclusion and diversity subcontracting plan, meeting the
requirements of Task 3.5;
(d) A listing of any assumptions, clarifications or qualifications made by the Project
Company in providing its Task 5 Technical Deliverable Material that are material
to any part thereof, including a statement as to what information supplied by the
City (if any) the Project Company proposes to use as the basis of any portion of its
Task 5 Technical Deliverable Material; and
(e) Any other information reasonably requested by the City with regard to the Task 5
Technical Deliverable Material as necessary or appropriate to make a
determination as to whether to proceed with the Project.
5.1.8. Open Book and Subcontractor Requirements
(a) The Project Company shall conduct any supplier proposal process on an "open
book" basis, and shall allow the City to participate in the receipt and analysis of
all proposals, including but not limited to the following:
(i) Conduct supplier procurement processes so as to obtain competitive
pricing for cost components of the Project construction including
equipment and materials to be incorporated into the construction, and
equipment and temporary facilities used in performing the construction.
(ii) Submit draft procurement documents including procurement contract
language, technical specifications, and drawings utilized to solicit
procurement proposals, which will be made available to the City at the
time of the Cost Submittal.
(iii) Distribute requests for proposals or requests for bids for the equipment to
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be procured to respective suppliers, respond to supplier's questions, and
prepare addendums as necessary. Copies of all solicitation documents,
addenda, and other relevant correspondence shall be provided to the City.
(iv) Solicit competitive bids from all major suppliers. A major supplier shall be
considered a supplier that provides equipment or materials equating to
one-half percent (0.5%) or greater of the Project direct costs; or as
otherwise agreed upon between the City and Project Company.
(v) Discuss the City's preferences and reach agreement between the City and
Project Company on the final supplier selections on the basis of best value,
after considering price and other non-monetary factors.
(b) The Project Company shall conduct any subcontractor proposal process on an
"open book" basis, and shall allow City to participate in the receipt and analysis
of all proposals. Project Company shall endeavor to invite at least three (3)
subcontractor proposers, if practical, for all major subcontracts, unless otherwise
authorized by the City. A major subcontractor shall be considered a subcontractor
that performs work equating to one-half percent (0.5%) or greater of the New
Wastewater Treatment Facility direct costs; or as otherwise agreed upon between
the City and Project Company. The Project Company shall furnish copies of
quotations to the City for review prior to award. The Project Company, following
consultation with the City, shall have the right to select on the basis of best value,
after considering price and other factors. A copy of the subcontract utilized during
the solicitation process will be furnished to the City.
(i) The Project Company may select certain subcontractors without
implementing the procurement process as required above if it first obtains
the City's written consent, which may be withheld in the City's discretion.
(ii) For selecting subcontractors, a prequalification process shall be utilized
by the Project Company by first identifying potential subcontractors and
then evaluating subcontractors based upon a prequalification
questionnaire. The prequalification questionnaire shall address evaluation
criteria agreed upon by the Project Company and City.
(c) Project Company shall not employ any subcontractor or supplier against whom
the City may have reasonable objection. The Project Company shall not be
required to employ any subcontractor, supplier, or other individual or entity to
furnish or perform any work against whom the Project Company has reasonable
objection.
(d) Project Company shall provide substantiation for all work proposed to be
performed by the Project Company, Project Company's Design-Builder,
Operational Maintenance Services Provider and other Key Subcontractors that
will perform work without participating in a competitive procurement.
5.1.9. Final Price Submittal (which shall be valid for a period of 140 days)
(a) A proposed Capital Charge Component, expressed on an annual basis, with a
detailed and comprehensive description of how the proposed Capital Charge
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Component was derived and the material factors on which it was based (financing
costs);
(b) Intentionally omitted;
(c) A proposed Design-Build Price on a fixed lump sum price basis, which shall be
accompanied by appropriate open-book pricing supporting documentation based
on quantities, subcontractor and supplier quotes obtained and substantiation of
all non-bid work as developed pursuant to this Task 5;
(d) A proposed Operations Charge Component, with a detailed and comprehensive
description of how the proposed Operations Charge Component was derived and
the open-book pricing and the material factors on which it was based;
(e) A proposal on how the Operations Charge will be escalated annually;
(f) Identification of an annual repair and replacement program and allowances;
(g) An annual guaranteed maximum energy utilization;
(h) An annual guaranteed maximum on any other amounts that the City has agreed
in its discretion to treat as a pass-through;
(i) Proposed Return-on-Equity schedules;
(j) An annual Service Fee that supports the annual Service Fee calculation and
reflects the proposed "Design-Build Subcontractor Fee", "Operations
Subcontractor Fee" and "Return-on-Equity" set forth in the Project Company's
Proposal, as well as the Preliminary Services Fee; and
(k) All costs, bids, quotes, estimates, substantiation and other information
supporting the Task 5 Technical Deliverable Material shall be made available to
the City.
The Capital Charge Component and proposed Operations Charge Component and the other
elements of the Task 5 Technical Deliverable Material shall be based upon the risk allocation
established by the Project Agreement.
5.1.10.Equity Financing Plan Requirements
The Project Company must provide a full description of a complete equity financing plan for the
Project Agreement (the "Equity Financing Plan"), including the amounts and timing of required
funds through the Design-Build Period, the complete operation and maintenance period and
including all the Operation and Maintenance Services and the lifecycle maintenance.The sources
of funds must match the demand for funds throughout both the design-build period and the
operation and maintenance period. Note that some of these deliverables may not be applicable
or necessary, depending on the final financing arrangement.
5.1.11.Committed Equity Financing
The Equity Financing Plan must demonstrate the sources of private equity finance and the level
of commitment of such equity financing, and include the following information, unless otherwise
agreed to in writing by the parties:
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(a) Full details of each source of financing, including equity, any construction or
standby facilities, and internally generated funds (separated into interest earned
on deposits, reserve accounts, and third party income);
(b) Identification and credit status of each equity investor and the amount to be
provided by each investor, including expected yields or returns;
(c) For each investor subscribing equity, details about the availability of equity /
quasi-equity finance, including, as applicable, copies of all relevant agreements
and board minutes approving the quantum of equity / quasi-equity to be
provided;
(d) If guarantees are to be provided as part of the financing package, written
confirmation by each shareholder's parent company, stating that it is able to
provide a parent company guarantee in relation to the availability of the equity /
quasi-equity (including the holding of subordinated debt in a tax-exempt
structure) for the Project, and that it has adequate funds available;
(e) If any equity or quasi-equity finance is to be raised from external sources, specify
such sources and provide written confirmation from the providers as to their
willingness to provide funding and the amount of funding available; and
(I) Full description (including, where applicable, copies) of all relevant agreements
evidencing and confirming the extent of support (including performance
guarantees) that is to be provided in respect of the obligations and liabilities of the
Project Company by each of the Project Company's shareholders, subcontractors
and associated third parties, including details of any parent and ultimate parent
company involvement in any and all such elements of support.
5.1.12.Term Sheet
The Project Company must provide term sheets for all the equity financing providers including:
(a) The identity of the investor;
(b) The period for which such capital shall be made available;
(c) Type of equity/share;
(d) The amount of committed equity and currency in which it is to be provided;
(e) The drawdown schedule;
(I) Details of grace periods, including duration and contingency;
(g) Repayment or redemption schedules, maturity dates and prepayment terms
(including make-whole clauses);
(h) Details of the performance security package to be provided by each of the Project
contractors, including details of letters of credit or other security, bonding or
guarantee requirements and costs (from either parents or third parties);
(i) Any conditions precedent for disbursement;
(j) Due diligence requirements;
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(k) Any other restrictions, requirements or conditions that may materially impact the
Project Company's ability to drawdown on committed equity financing upon
execution of the Project Agreement;
(1) Details of any standby facilities provided to satisfy the requirements of the Project
Agreement;
(m) To the extent that other forms of finance, other than equity, are to be used the
Project Company is to provide appropriate details equivalent to those requested
above for equity and debt finance.
5.1.13.Support Letters
The Project Company must provide confirmation from each of its equity or quasi-equity(including
the holding of subordinated debt in a tax-exempt structure) providers:
(a) That the equity or quasi-equity provider has reviewed and approved the Equity
Financing Plan and pricing established in the Task 5 Technical Deliverable
Material;
(b) That the equity or quasi-equity provider is fully committed to providing the equity
or quasi-equity described in the Equity Financing Plan, and
(c) That the equity or quasi-equity provider will make the funds available as described
in the Equity Financing Plan.
5.1.14.Taxes
The Project Company must provide full details of its taxation assumptions to demonstrate that
the Project Company has given full consideration to all tax implications in preparing the Equity
Financing Plan and Financial Model.
5.1.15.Financial Model Requirements
The City is waiving any additional requirements regarding the Financial Model.
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SCHEDULE OF VALUES AND RATE SCHEDULE
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- PSA Amendment No.1
EPCQR FOOTHILLS WATER PARTNERS
SCHEDULE OF VALUES - FINAL (March 24, 2023)
TASK/SUBTASK NAME Contract Amount
TASK 5: 90%SUBMITTAL PACKAGE
501 Project Management+ Expenses $172,342
502 Technical Deliverable Material to 90%completion(Design Drawings&Specs) $1,871,610
503 Aqua-Aerobic Design $626,750
504 Permitting Applications $107,616
505 Archaelogical Investigation&Assessment(Extended)* $37,427
506 Solar Study* $45,169
507 Environmental Assessment(1yr update)* $18,779
508 Cost Estimating and Affordability Cap Analysis $98,728
509 Management Plan Updates $33,530
510 Hazardous Building Material Survey+ Demo Permit Application* $41,400
511 Final Project Submittal $49,651
Task 5 SubTotal $3,103,002
*Subcontractor costs are reimbursable subject to reasonable cost substantiation.
REIMBURSABLE EXPENSES-BUDGETARY ONLY,ACTUAL COSTS TO BE INVOICED IF INCURRED
RO1 Travel(assumes 5 people x 3 trips x$1500/pp/trip) $22,500
Reimbursable Expenses SubTotal(Estimated) $22,500
TASK/SUBTASK NAME EPCOR WSP Aqua Aeorbic Subcontractor Aecon Markup Aecon Direct Total Comments
(see tab) (see tab) (TBD) (15/o) (see tab)
TASK 5:ADDITIONAL PRELIMINARY SERVICES
501 Project Management+Expenses $73,412.00 $0.00 $0.00 $0.00 $0.00 $98,930.00 $172,342.00
502 Technical Deliverable Material to 90%completion(Design Drawings&Specs) $27,384.00 $1,582,170.00 $0.00 $0.00 $237,325.50 $24,730.00 $1,871,609.50
503 Aqua-Aerobic Design $0.00 $0.00 $545,000.00 $0.00 $81,750.00 $0.00 $626,750.00 See Aqua-Aerobic proposal
504 Permitting Applications $7,300.00 $64,575.00 $0.00 $0.00 $9,686.25 $26,055.00 $107,616.25
505 Archaelogical Investigation&Assessment(Extended) $2,668.00 $30,225.00 $0.00 $0.00 $4,533.75 $0.00 $37,426.75 See Cultural Resources Study Proposal
506 Solar Study $2,248.00 $37,323.00 $0.00 $0.00 $5,598.45 $0.00 $45,169.45 See Solar Study Proposal
507 Environmental Assessment(lyr update) $2,248.00 $14,375.00 $0.00 $0.00 $2,156.25 $0.00 $18,779.25 See Phase 1 ESA Update Proposal
508 Cost Estimating and Affordability Cap Analysis $12,608.00 $0.00 $0.00 $0.00 $0.00 $86,120.00 $98,728.00
509 Management Plan Updates $8,380.00 $0.00 $0.00 $0.00 $0.00 $25,150.00 $33,530.00
510 Hazardous Building Material Survey+Demo Permit Application $0.00 $0.00 $0.00 $36,000.00 $5,400.00 $0.00 $41,400.00 Subcontractor TBD
511 Final Price Submittal $33,680.00 $0.00 $0.00 $0.00 $0.00 $15,971.00 $49,651.00
Task 5 Total $169,928.00 $1,728,668.00 $545,000.00 $36,000.00 $346,450.20 $276,956.00 $3,103,002.20
Chris
Ryan David Lomonoco/Mi Andrew
Name Daniel Bailet Kirstie Craig Litwinow Zawierucha Lee Ward ke Kasem Milakovich Jacyn Koski
Project Project Project Project Project 0&M SME SCADA/Com Financial Lead External Costs Total
Title Executive Development Execution _Manager Advisor munications
Rate $ 186.00 $ 140.00 $ 140.00_$ 118.00 $ 140.00 $ 118.00 $ 140.00 $ 140.00
501 Project Management+Expenses 46 262 24 102 66 30 0 $ 73,412.00
502 Technical Deliverable Material to 90%completion 16 48 36 24 36 12 24 $ 27,384.00
503 Aqua-Aerobic Design 0 0 0 0 0 0 0 $ -
504 Permitting Applications 6 16 8 12 3 6 2 $ 7,300.00
505 Archaelogical Investigation&Assessment(Extended) 0 6 4 4 4 2 0 $ 2,668.00
506 Solar Study 0 5 2 4 4 2 0 $ 2,248.00
507 Environmental Assessment(1yr update) 0 5 2 4 4 2 0 $ 2,248.00
508 Cost Estimating and Affordability Cap Analysis 28 18 12 14 0 6 6 $ 12,608.00
509 Management Plan Updates 0 24 8 12 3 8 8 $ 8,380.00
510 Hazardous Building Material Survey+Demo Permit Application 0 0 0 0 0 0 0 $ -
511 Final Project Submittal 40 40 80 40 40 $ 33,680.00
$ 169,928.00
TASK 5: 90%SUBMITTAL PACKAGE
Task Description Employee Position Rate Hours Total
Erin O'Farrell Project Controls Jr. Manager $134.00 145 7 $ 19,430.00
Dan Frazer Design Manager $147.00 180 $ 26,460.00
501 Project Management+Expenses
Jamie Abernethy Project Director $187.00 240 $ 44,880.00
Trish Wright Project Admin/Timekeeper $ 68.00 120 $ 8,160.00
501 Sub-Total: $ 98,930.00
Pablo Guillen Manager,Integrated Digital Delivery $134.00 60 $ 8,040.00
502 Technical Deliverable Material to 90%completion(Design Drawings&Specs) Salim Abdelkarim Senior Coordinator,IDD $110.00 125 $ 13,750.00
Dan Frazer Design Manager $147.00 20 $ 2,940.00
504 Sub-Total: $ 24,730.00
503 Aqua-Aerobic Design
504 Permitting Applications Dan Frazer Design Manager $147.00 120 $ 17,640.00
Jamie Abernethy Project Director $187.00_ 45 $ 8,415.00
504 Sub-Total: $ 26,055.00
505 Archaelogical Investigation&Assessment(Extended)
506 Solar Study
507 Environmental Assessment(1yr update)
Tyler Oleksiw Lead Estimator $147.00 165 $ 24,255.00
Bill Morrow Sr.Elec.Superintendent/Estimator $162.00 130 $ 21,060.00
Kazeem Omokanye Civil Estimator $134.00 130 $ 17,420.00
508 Cost Estimating and Affordability Cap Analysis
Charles Kent Mechanical Estimator $134.00 70 $ 9,380.00
Mark Gilmore Mechanical Estimator $134.00 70 $ 9,380.00
Jamie Abernethy Project Director $185.00 25 $ 4,625.00
506 Sub-Total: $ 86,120.00
Erin O'Farrell Project Controls Jr. Manager $134.00 80 $ 10,720.00
509 Management Plan Updates Dan Frazer Design Manager $147.00 60 $ 8,820.00
Jamie Abernethy Project Director $187.00 30 $ 5,610.00
507 Sub-Total: $ 25,150.00
510 Hazardous Building Material Survey(Rqd for Demo Permit)
Lake Oswego Wastewater Treatment Plant
Preliminary Services Woo VJ•
Fee Proposal and Labor Estimate
PW19-02-06
Consultant Hours
BriantHabibl Doug Tim L I Lidia I Andrea I Erin I Aaron Ianen/Hann{Chris Mike I Steve I Lee I I Adam I Same, I Kostis I Jim Emilio I Cole I Reyna Future I Future I Future I Future Rachel _
Water/Wastewater Group Including Site/Civil and Stortnwater Electrical Geotech Group Structural Group HVAC/Plumbing Group Portland Office
QA/QC Project Project Senior Mid Project Sr.CAD Jr.CAD Electrical l&C Electrical Lead Geotech Geotech Lead Struct Structural Structural Lead HVAC HVAC Lead SW SW
Task No. Description Principal Manager Manager Controller Engineer Engineer Engineer EIT Tech Tech El&C PE Engineer Engineer CAD Engineer Engineer Engineer Engineer CAD Engineer Engineer HVAC CAD Principal Engineer Engineer CAD Tech Clerical Total
RATES $225.00 $250.00 $210.00 $205.00 $175.00 $150.00 $110.00 $ 80.00 $135.00 $ 90.00 $175.00 $150.00 $160.00 $100.00 $ 240.00 $ 160.00 $ 250.00 $ 175.00 $ 125.00 $ 180.00 $ 115.00 $ 95.00 $ 162.88 $ 225.00 $ 215.00 $ 125.00 $ 80.00 Hours Total
Task.Project Management
0010 Management 8 Coordination 4 8 32 40 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 16 100 $19,100
0020 Schedule Prep 8 Maintenance 0 0 2 8 2 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 12 $2,410
0030 Risk Management Development and Maintenance 1 0 4 4 2 0 0 0 0 0 1 0 3 0 0 0 0 0 0 0 3 0 0 18 $3,870
0040 Work Management Development and Maintenance-PMIS 0 0 2 4 0 0 0 0 0 0 1 0 1 0 0 0 0 0 0 0 1 0 0 9 $1,945
TOTAL HOURS AND COSTS 5 8 40 56 4 0 0 0 0 0 0 0 0 0 2 0 4 0 0 0 0 0 0 0 4 0 16 139 $27,325
Task.S0%Design Package
1010 Design Drawings 16 32 224 0 288 64 0 96 480 288 40 0 0 64 800 480 16 32 128 0 128 64 192 0 3,432 $525,320
1020 Specifications 9 0 34 0 51 17 51 0 0 0 24 0 0 9 34 0 $ 17 0 0 17 51 0 0 323 $57,015
1030 Reports,Modeling,Investigations,and Studies 0 0 36 0 36 36 0 72 0 0 0 108 180 0 18 0 0 0 0 0 0 36 0 0 522 $90,630
1040 Permitting 0 0 28 0 28 0 0 140 0 0 0 0 0 0 28 0 0 0 0 0 7 168 0 0 399 $64,575
1050 Operations and Maintenance Plan 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 $0
1060 Decommissioning and Transition Plan 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 $0
1070 WIFIA Assistance 0 0 10 0 30 0 40 60 10 20 0 0 0 0 0 0 0 0 0 0 0 40 0 0 210 $28,300
1080 Meetings 0 0 40 0 40 0 0 0 0 0 8 10 0 10 40 0 10 0 0 0 10 30 0 0 198 $39,200
1090 Project Commissioning and Startup Plan 0 0 0 0 0 0 0 0 0 0 0 0 0 16 120 60 8 20 12 0 0 0 0 0 236 $37,380
1110 Building Code Changes 0 $0
TOTAL HOURS AND COSTS 25 32 372 0 473 117 91 368 490 308 72 0 0 0 118 180 99 1,040 540 43 69 140 0 162 389 192 0 5,320 $842,420
TOTAL LABOR HOURS AND COSTS 30 40 412 56 477 117 91 366 490 308 72 0 0 0 120 180 103 1,040 540 43 69 140 0 162 393 192 16 5,459 $869,745
OTHER DIRECT COSTS
1 Survey $40,000
2 CFD Modelling $25,000
3 Noise Survey $15,000
4 Solar Study $37,323
5 Biological Assessment $14,375
6 Electrical Engineer-Wood $219,000
7 Mivng Zone Study $20,000
8 AINW $30,225
9 Richwine $5,000
10 Influent Pump Station Modelling $60,000
11 WEA-Odor Control Expert $35,000
12 Architect $350,000
13 Travel,Meals,Hotel,Car $8,000
TOTAL OTHER DIRECT COSTS $858,923
TOTAL COSTS $1,728,668
Task-502 Total $1,682,170
EXHIBIT B
WORK SCHEDULE
EXHIBIT B
WORK SCHEDULE
3.1. MILESTONE SCHEDULE FOR PERFORMANCE AND REVIEW
Upon the execution of this Agreement, the Project Company shall proceed with Task 1, as set
forth in Appendix 1 (Scope of Basic Services). The Project Company shall complete each Task
within the time for performance set forth in the following table. The City expects to complete its
review within the period indicated in the below table.
City's Review Time of Re-
Time of Performance Period Submission
Task (Calendar Days) (Calendar Days) (Calendar Days)
Task 1 127 30** --
Task 2 67 30** --
Task 3 90 30** --
Task 4 20 90** --
Task 5 220 45 15***
**Due to the City's Council being in recess in August, up to an additional 30 calendar days
should be expected if the City's review period overlaps in part or entirely with the month of
August.
***Or otherwise reasonably agreed to by both parties.
3.2. COMPLETION DATE
Based on the time for Project Company performance and for City review provided in Section 3.1
(Milestone Schedule for Performance and Review) of this Appendix, and assuming (1) no material
suspension of Preliminary Services by the City, and (2) that no Relief Events have occurred, the
Additional Preliminary Services shall be completed within the time period set forth in the Work
Schedule included in Section 3.1 (Milestone Schedule For Performance and Review) above. Each
price submittal provided pursuant to Task 5 shall be held for 140 days from the date of receipt.
B-1
Attachment 2: Consultant Spending on Wastewater Treatment Facility Project
Total Paid Total Paid since Estimated Cost from Project
Since the Total Amount EPCOR Projected
Total Contract New Contract Start in 2018 to Project
Consultant Function Amount Start of Remaining on Agreement Spending to Total Agreement Enactment and Pre-
Project in Contract (May 2021 to April 2024
2018 now) Construction in April 2024
Owner's
Illuminati Infrastructure Advisors Representative& $497,000 $368,000 $129,000 $235,000 $129,000 No Change $497,000
(Jill Jamieson)
Financing Advisor
Carollo Engineers Technical Advisor $1,132,000 $873,000 $259,000 $700,000 $466,000 $1,339,000 $1,339,000
Hawkins,Delafield&Wood Legal Advisor $1,049,000 $1,045,000 $4,000 $536,076 $280,000 $1,329,000 $1,325,000
Property Acquisition
Universal Field Services and Relocation $168,000 $77,000 $91,000 $77,000 $151,000 $228,000 $319,000
Services
Jones Lang LaSalle(Jill Jamieson). Owner's
The contract has been Representative& $100,000 $88,000 N/A N/A N/A N/A $88,000
terminated. Financing Advisor
WCX(No longer in Business) Owner's $10,000 $4,000 N/A N/A N/A I N/A $4,000
Representative
Argent Management(Completed) 2018 Feasibility Study $150,000 $150,000 N/A N/A N/A N/A $150,000
FCS Consulting(Completed) Wastewater Rate $8,000 $8,000 N/A N/A N/A N/A $8,000
Model Update
Total $3,114,000 $2,613,000 $483,000 $1,548,076 $1,026,000 $2,896,000 $3,730,000
3-30-23