WHEREAS, in 1996 the Council authorized an assessment, testing and planning tasks, for the Boundary Rehabilitation Program, including development of the outage-driven, multi-year program plan of 320 coordinated tasks to be addressed over the next 12 years, and these were completed on time and under budget ($1.1 million spent; $4.1 authorized); and

WHEREAS, the total loaded estimated project costs in actual dollars for the proposed 14-year Boundary Rehabilitation Program (1995-2008) may reach $93.5 million; and

WHEREAS, the City's adopted 1997-98 CIP allocates $11.8 million and $15.3 million in 1997 and 1998 respectively to perform design and construction management on work focused on assuring compliance with current license requirements, meeting safety regulations, and increasing basic system reliability; and

WHEREAS, the City Light Department has established a goal of stable rates for the remainder of this century, the achievement of which will necessitate significant cost control measures in both the Operation and Maintenance and CIP components of the Department's budget; and

WHEREAS, it is in the interest of the citizens of Seattle that the City Light Department and the City Council establish a clear framework for the review of project progress, assuring that the City's future commitment to project resources is consistent with the Department's overall financial goals and direction, and is responsive to shifting external regulatory and market conditions;

NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SEATTLE, THE MAYOR CONCURRING, THAT:

Section 1) City Light goals for the Boundary Hydroelectric Facility Rehabilitation Program are adopted as follows:

a) Project rehabilitation is intended to preserve the current level of low-cost power available from the Boundary Facility.

b) The redesign, upgrade or replacement of plant areas will:

comprehensively address critical facility requirements, and

take advantage of current technologies, assuring Seattle citizens continued long term benefit from this resource.

c) The rehabilitation will allow City Light to maintain Boundary as a reliable facility with minimum unexpected costs and staffing burdens.

d) The rehabilitation will meet current federal, state and local regulatory requirements.

e) Project schedules will strive to reduce overall project costs by taking full advantage of planned outages, thereby allowing City Light continued access to low-cost power during the construction period.

City Light will meet these goals in the current design contract, in part, by implementing the following project management measures:

a) Establish a Project Oversight Committee, including Executive Team members, OMP staff, and City Council staff, that will provide regular review and guidance on program scope, schedule and budget.

c) Establish a dedicated interdisciplinary City Light project team, whose first priority work will be the Boundary program.

d) Strengthen City Light project management by assigning, for the duration of the program, at least one additional staff person whose primary responsibility will be cost control and contract management.

d) Enhance project management and cost control language in all project contracts.

Additionally, City Light will investigate the following project management measures for inclusion in subsequent bodies of work as follows:

a) Use of value engineering.

b) Use of fee incentive awards (e.g., critical path and planned outage methods, accelerated schedules).

c) Use of alternative contracting methods (e.g., general contracting/construction management, multi-disciplinary, purchase order, construction, and design/build).

Section 2) City Light will provide a workshop in June or July 1997 at which Council will receive detailed information and discussion from the City Light project team and a panel of independent advisors on the following:

a) How the Boundary Rehabilitation Program fits within the context of the Department's strategic direction and goals.

b) A review of the scope of work, cost estimates and schedules of the Boundary Program to provide for an improved understanding of the major project issues and risks.

c) City Light's approach to overall risk management for the project including:

the identification of specific measures to be investigated or implemented by City Light to assure overall risk reduction during the life of the project;

the establishment of specific risk reduction criteria which can be reviewed by Council when future "bundles" of project tasks are presented for subsequent Council authorization;

a discussion of the specific advantages and disadvantages of traditional implementation

ofthe project tasks versus design/build, general contractor/construction management GCCM) or other alternative approaches, including an analysis of the most appropriate project tasks for alternative contracting methods, and an outline of the possible risks.

d) The independent advisors will provide an examination and discussion of market experience in projects of this caliber, identifying benchmark projects, reviewing innovative approaches and/or examples where rehabilitation problems were successfully overcome. Special emphasis should be placed on the types of project oversight (including that of senior utility managers or elected officials) were used on these projects.

e) A discussion of the opportunities, options and approaches for defining and implementing the next phases of the Boundary rehabilitation.

The outcome of the workshop will be the establishment of final "key decision points," where in the estimation of Council and Executive, a review of project progress, options and cost estimates are required prior to the authorization of subsequent contract ammendments or solicitations. City Light will provide additional workshops as the Council and Department determine the need for such.

Section 3) Until these key decision points are established, any additional work on this project beyond the amendment to the current contract (similar to that shown in Attachment A) is understood to require Council review. Additionally, throughout the life of this project, quarterly progress updates will be provided to the Council in a form substantially similar to that shown Attachment B.

ADOPTED by the City Council of the City of Seattle this __________ day of _______________, 1997, and signed by me in open session in authentication of its adoption this __________ day of _______________, 1997.

_____________________________________

President __________ of the City Council

Filed by me this __________ day of ____________________, 1997.

_____________________________________ City Clerk

THE MAYOR CONCURRING:

__________________________ Norman B. Rice, Mayor

(Seal)

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