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Reservoir tab may run into millions before work even starts

Fixing cracks in the 15-billion-gallon reservoir is estimated to cost $125 million. Water rates will go up to pay for repairs.

CHRIS ZUPPA | Times

Fixing cracks in the 15-billion-gallon reservoir is estimated to cost $125 million. Water rates will go up to pay for repairs.

Before hiring someone to launch a massive repair project for its cracked reservoir, Tampa Bay Water's staff wants to spend nearly $1 million hiring someone to help with the hiring.

The regional utility's board is scheduled to vote Monday on a $908,000 contract with auditing firm KPMG to act as a "procurement expert" to help the agency's staff choose the right team to fix the reservoir cracks.

There's more. Also on tap is a contract with the National Research Council that could reach another $1 million for a scientific review of the repair plans.

Plus, the utility is considering hiring Black & Veatch, the engineer that helped oversee construction of the flawed $140 million reservoir, to serve as "owner's engineer'' to represent Tampa Bay Water during the repairs. No dollar figure is attached to that contract yet.

The contracts have already raised eyebrows for one Tampa Bay Water board member.

"I don't know how we can substantiate spending $1 million on each one of them," said Charlie Miranda, a Tampa City Council member who serves on the utility's board. "You mean we don't have enough engineers on staff who could do this?"

However, the utility's general manager defended the contracts with KPMG and the scientists at the National Research Council for their work on the $125 million repair project, which will be financed at least in part by an increase in water rates.

"These two members of our procurement team will provide tremendous expertise to the agency which helps to ensure that our ratepayers receive excellent value and a technically reliable remedy," the utility's general manager, Gerald Seeber, wrote in an e-mail to the Times.

In particular, he wrote, they will "ensure the best fix for the best value — to ensure the public doesn't overpay for this costly fix." This is different from how the utility picked the reservoir's builder, he said, but contended that was a different process.

KPMG has special skills that will help Tampa Bay Water "enhance interest in the marketplace, secure the best guarantees and evaluate . . . the proposals" from bidders, Seeber wrote in an Oct. 5 memo to the board.

KPMG's contract requires the utility to pay a senior partner $350 an hour for 680 hours, senior staff members $300 an hour for 1,440 hours and so forth, Miranda noted. Yet he wondered exactly how many bidders KPMG's staff would even be reviewing, considering that reservoir repair is a somewhat specialized field.

"I'm going to pay somebody $1 million just to interview, what, two people?" he asked.

The National Research Council is an arm of the National Academy of Sciences. A proposed contract with the council to provide peer review for the repair plans, which was supposed to be on Monday's agenda but has now been deferred, was to cost $999,000. That amount may change as the two sides renegotiate the scope of the work, Seeber said.

Seeber conceded that the cost of such expertise "is substantial," but noted that it's only a tiny percentage "of the estimated total cost planned for the project and provides tremendous value and expert advice for both our board and the public."

As for the Black and Veatch contract, Seeber said, only two companies applied for the position, and "Black and Veatch was deemed the most qualified submittal. Their role as system engineer does not conflict with their role for this project."

When the utility opened the C.W. Bill Young Regional Reservoir in June 2005 as a place to store up to 15 billion gallons of water skimmed from the Alafia River, Hillsborough River and Tampa Bypass Canal, officials boasted that it would be "the benchmark by which other reservoirs in Florida are measured." Then in December 2006, an employee found the first cracks.

Tampa Bay Water is now suing the companies that designed and built the reservoir, blaming the mess on its contractors — although records show those contracts were let by the utility board with little or no discussion of the project's scope or expense.

The reservoir is the largest in Florida, covering about 1,100 acres in east Hillsborough County. Its walls consist of an earthen embankment as wide as a football field at its base, averaging about 50 feet high. An impermeable membrane buried in the embankment prevents leaks.

The embankment's top layer is a mixture of soil and cement to prevent erosion. That's what cracked. Some cracks were up to 400 feet long and up to 15½ inches deep. Workers patched the cracks, but the fix didn't last.

So last fall workers drained half the water to investigate — a move that, due to a lack of rain, backfired. The region's thirst drained the reservoir the rest of the way by the spring, and subsequently the utility had to pump more water out of the ground than its permit allows.

In June, utility officials announced that water trapped between the soil-cement lining and the membrane was causing the cracks.

Fixing the reservoir will require raising rates for the region's 2 million water customers, Seeber said in June. During the repairs, scheduled to begin in June 2012, the reservoir would have to be drained dry for two years.

Craig Pittman can be reached at (727) 893-8530 or craig@sptimes.com.

Reservoir tab may run into millions before work even starts 10/15/09 [Last modified: Friday, October 16, 2009 1:07am]
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