HomeMy WebLinkAbout03. Authorize an amendment to an existing services contract with Alfred Conhagen Inc., increasing to $322,250 for completed repairs to steam turbine Page 1 of 2
Item 3.
CENTRAL SAN BOARD OF DIRECTORS
POSITION PAPER
MEETING DATE: APRIL 20, 2023
SUBJECT: AUTHORIZE THE GENERAL MANAGER TO EXECUTE AN AMENDMENT TO
AN EXISTING SERVICES CONTRACT WITH ALFRED CONHAGEN, INC. IN
AN AMOUNT NOT TO EXCEED $150,000, BRINGING THE TOTAL COST
CEILING TO $322,250, FOR COMPLETED REPAIRS TO THE SPARE
STEAM TURBINE ROTOR; AND FIND THE PROJECT IS EXEMPT FROM
THE CALIFORNIA ENVIRONMENTAL QUALITYACT
SUBMITTED BY: INITIATING DEPARTMENT:
CLI NTSHIMA, SENIOR ENGINEER OPERATIONS-MAINTENANCE
REVIEWED BY: NEIL MEYER, PLANT MAINTENANCE DIVISION MANAGER
PAUL SEITZ, PROVISIONAL DIRECTOR OF OPERATIONS
Roger S. Bailey
General Manager
ISSUE
In accordance with purchasing procedures, Board of Directors (Board) authorization is required for the
General Manager to amend a services contract when the total amount exceeds the staff authority of
$200,000.
BACKGROUND
Central San operates two 2,950-hp steam-driven blowers to provide oxygen for the secondary treatment
process. When one turbine is online, the other serves as its backup. The new magnetic bearing electric
blowers, commissioned earlier this year, also provide redundancy.
Last year, Central San hired Alfred Conhagen, Inc. (Conhagen)to rebuild Aeration Unit#2 steam turbine.
When disassembling the steam turbine, a considerable amount of damage was found in the nozzle block
and throttle valve and the Board declared an emergency situation. Also, because of the substantial wear,
the existing rotor was removed and the spare rotor was installed. Plant Maintenance plans to perform an
April 20, 2023 Special Board Meeting Agenda Packet- Page 647 of 724
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overhaul of Aeration Unit#1 steam turbine later this year and expects to encounter a similar amount of
damage. Therefore, Plant Maintenance proceeded with repairing and balancing the rotor that was removed
from Aeration Unit#2 to be available as a spare for Aeration Unit#1.
Competitive pricing was obtained for the rotor repair work by Purchasing using the informal Request for
Quotations process. The repair scope includes cleaning, replacing the third stage turbine blades, as well
as low and high-speed balancing. Conhagen submitted the only bid of$134,875 and was awarded the
contract. When work began, Conhagen was unable to remove the blade wheels from the shaft, the shaft
needed to be cut out, and a new shaft had to be fabricated. The extra cost for the shaft work was $37,375,
bringing the total contract amount to $172,250. For comparison, purchasing a new shaft from the original
equipment manufacturer(OEM)would be approximately double the cost.
Conhagen has discovered that the seventh stage blades are not wedged properly and must be repaired.
Since the blades are partially worn, the blades should be replaced before re-wedging the wheel. The cost
for these additional repairs is approximately$150,000, bringing the total contract amount above the
$200,000 General Manager authority limit. Staff is seeking the Board's approval to amend the contract.
California Environmental Quality Act (CEQA)
Staff has concluded that this project is exempt from CEQA under Central San's CEQA Guidelines
Section 15301 since it involves minor alterations to existing, publicly owned facility. Approval of this project
will establish the Board's independent finding that this project is exempt from CEQA.
ALTERNATIVES/CONSIDERATIONS
Central San could purchase a new rotor from the OEM at a cost of approximately$1,300,000 with a lead
time of at least one year.
FINANCIAL IMPACTS
Funds to cover this contract amendment are available in the Plant Maintenance Fiscal Year 2022-23
Budget.
COMMITTEE RECOMMENDATION
The Engineering and Operations Committee reviewed this matter at its April 3, 2023 meeting and
recommended approval.
RECOMMENDED BOARD ACTION
Staff recommends the following Board actions:
1. Find that the project is exempt from CEQA; and
2. Authorize the General Manager to amend a services contract with Alfred Conhagen, I nc. in an
amount not to exceed $150,000, bringing the total cost ceiling to $322,250, for repairs to the spare
steam turbine rotor.
Strategic Plan Tie-In
GOAL SIX., Infrastructure Reliability
Strategy 1 - Manage assets optimally
April 20, 2023 Special Board Meeting Agenda Packet- Page 648 of 724