SFPUC details risk-driven changes, rising estimates for headworks and biosolids digester projects

The San Francisco Public Utilities Commission received a two-part workshop update July 23 on the Sewer System Improvement Program, with staff outlining why they shifted to a construction manager/general contractor (CMGC) delivery approach and how that choice has changed scope, schedule and risk treatment for the Headworks and Biosolids Digester projects.

Acting Director Howard Fung said CMGC brings contractors into the design phase to identify constructability issues early, tighten estimates and reduce the likelihood of costly change orders later. "The CMGC approach fosters collaboration between owner, designer and contractor," Fung said, describing phased bidding that can accelerate construction by years compared with traditional design-bid-build sequencing.

Jignesh Desai, senior project manager for the Headworks project, said CMGC-driven changes removed a planned underground 78-inch bypass in favor of a temporary above-ground 54-inch HDPE line and moved a proposed lift station to the plant boundary to reduce traffic and utility conflicts on Evans Avenue. Desai reported a project baseline of about $418 million and described a progressive bidding strategy with multiple packages to increase local business participation and better price market risk.

Carolyn Chu, senior project manager for the Biosolids Digester Facilities project, described the project as the SSIP’s largest component, replacing aging solids-handling processes at the Southeast plant that treats roughly 80% of the city’s wastewater. Chu said the design reduces active digesters from nine to five, will produce Class A biosolids (a pathogen-reduced product) and includes energy recovery expected to supply roughly 5 megawatts for onsite needs.

Chu reported the biosolids project’s planning baseline was about $1.3 billion, reflecting estimates made during earlier design phases, and said the team has secured roughly $813 million in low-interest loans, including approximately $699 million in WIFIA financing, plus state revolving fund loans. "These loans are projected to produce more than $400 million in debt-service savings over the life of the loans," Chu said.

Commissioners pressed staff for clarification about contingency and reserve practices after past city projects experienced large overruns. Staff described a three-estimate approach—designer, third-party reviewer, and CMGC—and said program-level reserves are held within grouped project buckets rather than a single line item. They also acknowledged that unforeseen geotechnical conditions can rapidly exhaust contingency, citing Calaveras as an example.

On geotechnical concerns and foundation design, commissioners asked whether piles would reach bedrock. Chu said the project team has retained geotechnical and shoring specialists and plans a focused follow-up presentation with those experts to describe how the design addresses soil conditions and settlement risk. "We will come back and really dig in," she said.

Public commenters urged the commission to scrutinize power availability for digesters and questioned the new technologies proposed for digestion and dewatering. Staff said redundancy work under SSIP will add a second feed to the Southeast plant and that energy-recovery components and a planned power-plant program are intended to provide additional onsite power.

The commission asked staff to return with more-detailed cost estimates, risk-dollar presentations and technical briefings on geotechnical mitigation before the next formal rebaseline of project budgets.