6b Terminal 5 Superfund Project Memo
COMMISSION AGENDA MEMORANDUM Item No. 6b ACTION ITEM Date of Meeting February 11, 2020 DATE: January 24, 2020 TO: Stephen P. Metruck, Executive Director FROM: Ticson Mach, Capital Project Manager V Brick Spangler, Senior Environmental Program Manager Kaitlyn Jensen, Assistant Project Manager SUBJECT: Terminal 5 Pacific Sound Resources (PSR) Superfund Cap Maintenance (CIP #102722) Amount of this request: $0 Total estimated project cost: $1,935,000 ACTION REQUESTED Request Commission authorization for the Executive Director to advertise and execute a construction contract for the Terminal 5 Pacific Sound Resources Superfund Cap Maintenance project with a total project cost of $1,935,000. There is no funding requested; construction will utilize approved environmental remediation and liability funding. EXECUTIVE SUMMARY This project will maintain the environmental asphaltic cap over the PSR Superfund Site in the northwest part of Terminal 5 to remain in compliance with the 1999 Environmental Protection Agency (EPA) Record of Decision (ROD). The PSR site, located within the Terminal 5 intermodal yard and adjacent BNSF storage track area, was cleaned up under an order with the EPA as part of the Terminal 5 Southwest Harbor redevelopment project. The area of the asphaltic pavement cap is 1,002,389 square feet. The estimated remaining service life is 10 years. The asphalt serves to cap the underlying contaminated soils. Ongoing obligations include performing cap inspections and cap maintenance. In December of 2018, the required inspection indicated maintenance is needed to be compliant with the ROD. This will be achieved by sealing cracks, repairing pavement damage, and restoring the surface seal coating to prevent water intrusion into the underlying soil. Duration for design and permitting, which began in June 2019, is eight months and duration for construction is three months. Planned date of substantial completion is November 30, 2020. JUSTIFICATION An EPA required inspection in December 2018 of the PSR Superfund Site indicates this work is necessary to maintain compliance per the Port's legal agreement with the agency. Noncompliance could result in regulatory jeopardy and fines and/or penalties. Template revised January 10, 2019. COMMISSION AGENDA Action Item No. 6b Page 2 of 4 Meeting Date: February 11, 2020 Diversity in Contracting There will be a woman and minority business enterprise (WMBE) aspirational goal of six percent associated with this contract. DETAILS Scope of Work This project will restore and reseal specially-designed asphaltic pavement cap areas within the Terminal 5 intermodal yard, Jack Block Park and adjacent BNSF storage track area. Restoration components include establishing and maintaining temporary erosion and sediment control (TESC) measures, cleaning and repair of pavement cracks, localized wear lift replacement in areas of pavement damage, and restoration of the surface seal coat to meet the requirements of the Inspection and Maintenance Plan for the Asphalt Cap and Associated Stormwater System Revision 1, Pacific Sound Resources Site Remediation Area 4, Southwest Harbor Cleanup and Redevelopment Project (The RETEC Group, Inc. 2004). Schedule Activity Commission design authorization Q4 2018 Design start Q2 2019 Commission construction authorization Q1 2020 Construction start Q3 2020 In-use date Q4 2020 Cost Breakdown This Request Total Project Design and Management Oversight $0 $424,000 Construction $0 $1,511,000 Total $0 $1,935,000 ALTERNATIVES AND IMPLICATIONS CONSIDERED Alternative 1 No action, do not perform any maintenance activities on the cap Cost Implications: $0 Pros: (1) No cost, ERL funds remain for other projects (2) No impact to other projects associated with the Terminal 5 Dock Upgrade Cons: (1) Noncompliance with EPA Record of Decision resulting regulatory jeopardy and potentially fines and/or penalties (2) Risk of not properly containing the underlying contamination. This is not the recommended alternative. Template revised June 27, 2019 (Diversity in Contracting). COMMISSION AGENDA Action Item No. 6b Page 3 of 4 Meeting Date: February 11, 2020 Alternative 2 Complete upper (2-in.) wear lift replacement in both the Intermodal Yard and the BNSF Yard. Cost Implications: $11,340,000 Pros: (1) PSR cap would be fully replaced and would exceed EPA requirements (2) This option would extend the life of the asphaltic cap Cons: (1) Replacing the wear lift on the entire PSR site greatly exceeds what is required to maintain the asphaltic cap (2) The cost of this alternative exceeds the benefits of completely replacing the wear lift given the results of the inspection. This is not the recommended alternative. Alternative 3 Clean and repair pavement cracks, localized wear lift replacement in areas of pavement damage, and restoration of the surface seal coat Cost Implications: $1,935,000 Pros: (1) Appropriate use of budget (2) The PSR superfund cap will be appropriately maintained and brought into compliance with EPA requirements Cons: (1) The PSR cap may need to be repaired sooner than if a full replacement is performed. (2) The PSR cap maintenance is estimated to need additional repair in 5 years This is the recommended alternative. FINANCIAL IMPLICATIONS Cost Estimate/Authorization Summary Capital Expense Total COST ESTIMATE Original estimate $0 $3,903,000 $3,903,000 Current change $0 -$2,041,000 -$2,041,000 Revised estimate $0 $1,862,000 $1,862,000 Annual Budget Status and Source of Funds This project is included in the environmental remediation and liability program for which funding is approved annually. This project has utilized funding approved in 2018 for design in 2019 and will utilize funding approved in 2019 for construction in 2020. This project is funded by the tax levy. Template revised June 27, 2019 (Diversity in Contracting). COMMISSION AGENDA Action Item No. 6b Page 4 of 4 Meeting Date: February 11, 2020 Financial Analysis and Summary Project cost for analysis 1,935,000 Business Unit (BU) Joint Venture Effect on business performance NA (NOI after depreciation) NPV (if relevant) $8,366,000 CPE Impact Discount rate of 6.1% Assumes cap repair in 5 years and replacement in 10 years and 45 years Future Revenues and Expenses (Total cost of ownership) ATTACHMENTS TO THIS REQUEST (1) Presentation slides PREVIOUS COMMISSION ACTIONS OR BRIEFINGS. November 19, 2019 The Commission authorized the (1) spending of environmental remediation funds for 2020 in the amount of $28,730,000 and (2) a five-year spending plan for $123,312,000 for the environmental remediation liability (ERL) program for 2020-2024. November 13, 2018 the Commission authorized the (1) spending of environmental remediation funds for 2019 in the amount of $17,025,000 and (2) a five-year spending plan for $116,026,000 for the environmental remediation liability (ERL) program for 2019-2023. Template revised June 27, 2019 (Diversity in Contracting).
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