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Designing the Future for the St. Louis Water Division and the City. The vision…. “But we as Water Works men cannot live in the past or in the present. It is we who live 20 to 30 years in the future. It has been always thus, except that now the pace is faster.” - Water Division website.

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Designing the Future for the St. Louis Water Division and the City

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Designing the future for the st louis water division and the city

Designing the Future

for the St. Louis Water Division and the City

The vision…

“But we as Water Works men cannot live in the past or in the present. It is we who live 20 to 30 years in the future. It has been always thus, except that now the pace is faster.”

- Water Division website


Water division customer base has declined

Water Division customer base has declined

City population (in millions)

-63%


St louis water revenue vs expense

St. Louis water revenue vs. expense

now

2009 Rate increase

2008 Rate increase

Expense

19%

11%

Revenue

Millions of $

SOURCE: St. Louis Annual Operating Plans 2010, 2011, 2012 and 2013


You are about to lose your most valuable resources

You are about to lose your most valuable resources

Today, 1/3 of workforce eligible to retire

Retirement eligible


Delayed repairs and replacements are increasing capital needs

Delayed repairs and replacements are increasing capital needs

Capital needed (repair/replacements delayed)

Unfunded Projects

Cost (in millions of $)

Funded Projects

SOURCE: Black & Veatch Report


Our unique approach ensures success for st louis

Our unique approach ensures success for St. Louis

  • Peer-to-peer:Full-spectrum utility operations is what we do; we are your peer in all aspects.

  • Comprehensive evaluation: Our evaluation respects the interconnected elements of operations.

  • Efficiency implementation specialists: We are focused on implementing operational efficiencies– regulated utilities and traditional consultants don’t have to be.

  • Proven savings: We have track record of successful projects in NYC, Indy and Pittsburgh.

6


Veolia water s st louis team includes five city certified m wbe partners and jacobs engineering

Veolia Water’s St. Louis team includesfive city-certified M/WBE partners and Jacobs Engineering

Distribution system assessment, management technologies

Condition assessment of equipment, overall energy footprint

Water audit, bulk sales, evaluation of system capacity

Audit of procurement, inter-department charges

External and media communications

Organizational development, strategy planning, facilitation

Our M/WBE partners bring over 100years combined service to the community

7


We are a strongly local team with 650 area employees 225 from veolia and 425 from partner firms

We are a strongly local team, with 650 area employees (225 from Veolia and 425 from partner firms)

9employees: Veolia Water

13employees: Veolia Water

5employees: Randle & Assoc.

15employees: AFRAM Corp.

16employees: Veolia Energy

353employees: Jacobs Engineering

7employees: Hauser Group

7employees: Vector Comm.

187employees: Veolia Environmental Services

68employees: ABNA Engineering


Our expertise has enabled us to find and implement quick wins for our clients

Our expertise has enabled us to find and implement “quick wins”for our clients

Chemical Procurement

$750,000

in estimated

annual savings

Meter Change Out

$2,050,000

in new

annual revenue

Fee Implementation

$450,000

in estimated

new annual revenue


Designing the future for the st louis water division and the city

If selected for implementation, we will help you achieve up to $8.8 million in annual benefit (savings and new revenue)

$130million annually (up to 10.8% of budget)

$9million annually (achieved 18%)

$8million annually (up to 15%)

Up to $30million over a 5-year implementation


Designing the future for the st louis water division and the city

Our Phase 1 assessment will identify improvement opportunities across the Water Division’s entire budget

  • Vehicle maintenance and replacement analysis for a more reliable fleet

4% of Total Cost

7% of Total Cost

20% of Total Cost

29% of Total Cost

40% of Total Cost

Cost (in millions of $)


Designing the future for the st louis water division and the city

Reducing equipment costs: We transformed Buffalo Water’s approach to maintenance; a similar strategy may work here

Buffalo, NY fleet transformation

  • 170 vehicles (one vehicle to 1.8 employees)

  • Average age 11.6 years

  • $462,507 vehicle maintenance last year averaged $3,919 for 118 vehicles listed

    • 32 of the vehicles averaged $9,300 each

    • Blanket PO authorize additional $188,000 for repair and rentals

St. Louis opportunity

Reduced fleet 11%

Replaced 34% of fleet for the same cost as repairing older equipment


Designing the future for the st louis water division and the city

Our Phase 1 assessment will identify improvement opportunitiesacross the Water Division’s entire budget

4% of Total Cost

  • Better asset management and advanced predictive tools to minimize capital expenditures

7% of Total Cost

20% of Total Cost

29% of Total Cost

40% of Total Cost

Cost (in millions of $)


Designing the future for the st louis water division and the city

Renewal Year

Reducing future debt: Our study will evaluate opportunities for technology-based efficiencies in preventive maintenance

City GIS pipe data

InfoNet + MOSARE

Predictive tool color codes replacement schedule based upon a complex pipe-break algorithm


Designing the future for the st louis water division and the city

If implemented, this predictive technology helps target capital, saves overtime dollars and reduces outages

average

Avoid emergency repairs in the middle of the night at overtime rates

Our approach uses data such as breakage rates by pipe type and age, to target trouble areas


Designing the future for the st louis water division and the city

Our Phase 1 assessment will identify improvement opportunitiesacross the Water Division’s entire budget

4% of Total Cost

7% of Total Cost

  • More efficient electric consumption could save 10% or $270k in power

20% of Total Cost

29% of Total Cost

40% of Total Cost

Cost (in millions of $)


Designing the future for the st louis water division and the city

Reducing material costs: We used the Department of Energy’s Pumping System Assessment Tool to save money in Indy

$160K annual savings on power and heating

$250K initial cost for Variable Frequency Drive and ductwork

40% reduction in carbon usage

$90K annual savings


Designing the future for the st louis water division and the city

Reducing materials costs starts with a total water assessment for more accurate production requirement

12% unmetered vs. 45% in St. Louis

average

Water conservation saves resources


Designing the future for the st louis water division and the city

Our Phase 1 assessment will identify improvement opportunitiesacross the Water Division’s entire budget

4% of Total Cost

7% of Total Cost

20% of Total Cost

  • Improved processes, selection and requirements can save nearly $2 million

29% of Total Cost

40% of Total Cost

Cost (in millions of $)


Reducing contracts costs we identified chemical savings in purchasing and dosage for nyc

Reducing contracts costs: We identified chemical savings in purchasing and dosage for NYC

  • Purchasing and selection

  • Usage and dosing strategies

New York City DEP Commissioner Strickland shares the good news of $8 to $9 million in savings created within the first nine months, with a large part due to chemical savings

St. Louis opportunity


Designing the future for the st louis water division and the city

Our Phase 1 assessment will identify improvement opportunitiesacross the Water Division’s entire budget

Managed attrition with succession planning and training saving $3 million annually

4% of Total Cost

7% of Total Cost

20% of Total Cost

29% of Total Cost

40% of Total Cost

Cost (in millions of $)


You are about to lose your most valuable resources1

You are about to lose your most valuable resources

Today, 1/3 of workforce eligible to retire

Retirement eligible


Designing the future for the st louis water division and the city

Reducing personnel costs through attrition and insourcing: We streamlined the operation in Indy without layoffs

  • Attrition and voluntary changes reduced staff 28% in 9 years

+

+

Restructure/ Work Redesign

SOPs

Train


Designing the future for the st louis water division and the city

Our Phase 1 assessment will identify improvement opportunities across the Water Division’s entire budget

4% of Total Cost

7% of Total Cost

20% of Total Cost

Reinvest and stabilize rates

29% of Total Cost

40% of Total Cost

Up to $6.5 million saved annually

Cost (in millions of $)


Designing the future for the st louis water division and the city

Our comprehensive analysis of the Water Division will include an assessment of revenue enhancement potential

  • Metered customers represent 16% of all customers but 44% of revenue

  • Other new revenue sources

  • Sensitivity to customers:

    • Communication with large users

    • The Hauser Group

SOURCE: KPMG 2010


Designing the future for the st louis water division and the city

Our organizational structure promotes collaboration and staff buy-in through all levels of the program

Steering Committee

Steve Siegfried

David Gadis

TBD

Water Division department leads

Curt Skouby

Sam Dotson

David Carter

Jim Sondermann

TBD

Program Manager/ Phase 1 Study

Veolia Water

North America

Executive VP

Veolia Water North America

Vice President

Veolia Water Central Region

Comptroller’s Appointee

City of St. Louis

Deputy Commissioner

City of St. Louis

COO

City of St. Louis

Water Commissioner

City of St. Louis

President of the Board

of Aldermen’s Appointee

City of St. Louis

Project Management Team

Working Teams

Veolia Water team specialists


A collaborative peer to peer approach creates a made in st louis solution

A collaborative peer-to-peer approach creates a “Made-in-St. Louis” solution

11 Veolia Water Staff working with NYC DEP Management Team to find improvements.


As requested by your rfp o ur phase 1 study will be completed in four months

As requested by your RFP, our Phase 1 study will be completed in four months

Phase 1

Project setup and top down assessment

(if selected)

Phase 2

Plan improvements, then implement

Phase 3

Validate savings, continue

  • Total cost: $250,000

  • Duration: 4 months

  • Total cost and duration: To be negotiated (initiative dependent)

  • Total cost and duration: To be negotiated (initiative dependent)


If selected we will help you implement sustainable improvements building the utility of the future

If selected we will help you implement sustainable improvements, building the Utility of the Future

Value

Service

  • Indy 5-year rate freeze

  • Customer service excellence

  • Incoming calls (85% within 30 seconds)

  • Call abandons (4%)

  • Collections (99%)

SVR

  • ISO 14001 and 9001 achieved in Indy

  • Safety excellence

  • Environmental Sustainability

  • Water Quality

Responsibility


Designing the future for the st louis water division and the city

The Utility of the Future will benefit from the Veolia Water network of expertise and results delivered to our clients

Buffalo – saving $1 million each year and greatly improved customer service

Indy – saved $83.1 million

NYC – saving up to $130 million

Atlanta/Fulton County – developed M/WBE firms in award-winning partnership

Tampa Bay Water – savings featured on CNN Money

550

Communities currently being served in North America


Our unique approach ensures success for st louis1

Our unique approach ensures success for St. Louis

  • Peer-to-peer:Full-spectrum utility operations is what we do; we are your peer in all aspects.

  • Comprehensive evaluation: Our evaluation respects the interconnected elements of operations.

  • Efficiency implementation specialists: We are focused on implementing operational efficiencies– regulated utilities and traditional consultants don’t have to be.

  • Proven savings: We have track record of successful projects in NYC, Indy and Pittsburgh.


Designing the future for the st louis water division and the city

QUESTIONS?

32


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