Weighing in on the State of the Trenchless Sewer Market

The trenchless marketplace is in a constant state of flux. Those in the fieldneed to keep abreast of shifting market needs, emerging technologies and newcontracting methods. To try to keep pace with the changing landscape,Trenchless Technology sought the input of professionals representingowners, contractors, engineers and manufacturers from different areas of theUnited States.

Participants were asked about current hot-button topics like QA/QC,contracting and funding.

// ** Advertisement ** //

Participating in this article were:

Greg Ballard,Engineer, Metro Water Services, Nashville/Davidson County, Tenn.

// ** Advertisement ** //

Ahmad Habibian, Senior Engineer, Black & Veatch,Gaithersburg, Md.

Ed Kampbell,President, Rehabilitation Resource Solutions, Hilliard, Ohio

// ** Advertisement ** //

Dave Kozman, Business Development Manager, AmericanWater Services, Hilliard, Ohio

GerryMuenchmeyer, President, Muenchmeyer Engineering Associates LLC, New Bern,N.C.

Ed Trahan, Executive VicePresident, Masterliner, Hammond, La.

// ** Advertisement ** //

How have municipalities changed their approach torehab in the past few years?

Muenchmeyer: Municipalities todaypredominantly choose to rehab their underground collection systems usingtrenchless technologies. Many cities now bundle different technologies under onecontract to achieve a variety of repairs to their collection system. In somecases, excavation, lining and pipe bursting might be bid under the samecontract. This allows the owner to work with only one contractor to accomplish anumber of rehabilitation tasks. The cost for bidding multiple technologies,however, is typically higher since some technologies may need to besubcontracted. In general, significantly less disruption, faster installationand lower costs associated with trenchless technology have driven thechange.

// ** Advertisement ** //

Kozman: There have been a lot ofdiscussions about alternative procurement methods such as design-build and someagencies have integrated these approaches into their rehab contracts. However,contracts of this type have been slow to develop due to lack of acceptance,resistance to change and political influence, and the agencies that have madethe transition are going through a steep learning curve. Also, over timetrenchless contracts have become increasingly conservative, redundant andrestrictive, likely in an attempt by municipalities to cover their bases andminimize change orders. This strategy tends to backfire by leavingspecifications open for interpretation, which often turns away competition,drives up pricing and increases the likelihood of change orders.

Habibian: Many rehabilitation projectsimplemented in the past have fallen short of expectations with regard to I/Ireduction. It is now recognized to get meaningful I/I reductions, “totalrehabilitation” at the mini-basin level is critical. We have seen collectionsystem agencies moving toward the “total rehabilitation” approach.

// ** Advertisement ** //

 


Federal funding for wastewater projects is dwindlingwith little reason to think that it will increase any time soon. How aremunicipalities dealing with this change? What are the consequences of thereduced funding?

// ** Advertisement ** //

Muenchmeyer: Reduced funding — whetherlocal, state or federal — will cause the already failing infrastructure todeteriorate further. Sooner or later the rehabilitation will need to beaccomplished for the economy to continue to prosper. This reminds us of theadage “pay me now or pay me later.”

Kozman: While budget cuts are a perceivedblow to the trenchless industry, federal assistance should not be relied on as aprimary source of revenue. There are many other funding programs available thatare either not being explored or are not properly utilized. It seems likeeverywhere we turn there’s a new subdivision going up, a new school being builtand a new bond issue being proposed to pay for them. The media and politicianshave convinced society that schools, sports stadiums, development and surfaceimprovements take priority over routine repair and maintenance of buriedinfrastructure, when in reality they should all be treated with equalimportance. We are essentially sacrificing public health and welfare to keep upwith the Joneses. I am convinced that the funding is available, especially incities with a large tax base; it is just not being appropriated correctly.Problems with the nation’s infrastructure are real and well documented.Continuing to ignore the problems will cause bigger issues down the road.

// ** Advertisement ** //

Ballard: Budgets for capital work in allareas are strained at a time when the need for the rehabilitation ofinfrastructure is increasing. If we allow the rate of decay to exceed the rateof rehabilitation, we are headed for reductions in the quality of service,increased potential for environmental impacts and even the potential forcatastrophic failures. The selling of bonds for construction work is effective,but caution must be exercised to ensure that the rehabilitation project’ssuccessful life exceeds the bond payback period.

Habibian: Most agencies are relying onincreasing user fees. With significant rate increases, affordability will startto become an issue. Some municipalities are developing programs to alleviate theimpact on low-income families.

// ** Advertisement ** //

Kampbell: Federal funding has always beenin short supply. As this “free” money dries up, more and more cities look toaccomplish the needed rehabilitation more like a private business: they take outloans (bonds for a city are like a loan) and/or they raise their cost ofservices to gain the revenue needed to make the required improvements. We seethis now in a number of larger cities that are stepping to the forefront withplanned rate increases and on-going dedicated projects for those new funds. Iexpect we will see this approach trickle down in the near future to the mediumsized-cities as well. Small towns without a decent sized customer base are goingto be faced with some harsh decisions.


Contracting strategies have evolved over time fromlow bid to any myriad of approaches. What effect has this had on the rehabindustry? What trends do you see?

// ** Advertisement ** //

Muenchmeyer: The contracting strategy forthe rehab industry is primarily low bid even though some cities have come torealize that contracts awarded, based on low as well as qualified bids, resultin a better product. The design-build approach is popular on large structureprojects but has not been embraced by the rehab industry. The low-bid philosophycan be effective when it is associated with a well written, detailedspecification that clearly describes the requirements of the contract and theexpected results from the contractor. Performance-based specifications are anexample of how a higher level of quality can be achieved while still maintainingthe low-bid approach.

Kozman: This industry is highly specializedyet very competitive, and in most cases a contract is awarded to the lowest,most responsive bidder. Increased competition has driven pricing and marginsdown, causing contractors to cut corners and reducing overall quality of work.To overcome this, some agencies integrate qualifying criteria such as overallproject approach, performance history and qualifications into the selectionprocess. RFPs, design-build proposals, pre-qualification processes andinvitation-only bids are a few methods used in lieu of low-bid selection. Thisis a positive step for the industry since it will elevate product quality whilestill maintaining a competitive bidding environment.

// ** Advertisement ** //

Trahan: Most rehab work is still beingawarded on a low-bid basis with little or no regard for contractorqualifications. We don’t see any trend indicating this approach will change anytime soon. In most places the low-bid approach is what state law requires. Also,in most places contractor qualification is not allowed, and if allowed, is notmeaningful.

Ballard: We have tried performance-basedcontracting and have utilized the Request for Proposals method of contractorselection to attempt to obtain the services of the most responsive andresponsible contractors that offer the best overall value to our customers. Bothof these methods require the contractor to think about their approach to theproject and the impacts they create to our customers.

// ** Advertisement ** //

Kampbell: The low-bid method of procuring acontractor always breaks down when the engineer and/or the owner fail toadequately specify the needed repairs for the project’s goals. Design-buildintroduces the solution provider (contractor) into the process at a point whereit is needed to correctly assess the project’s options to meeting the desiredgoals. Because of the low-bid mindset that is reinforced by many state laws,design-build is not always available to a municipality; thus the large number ofhybrids to design-build to try to meet the legal issues while giving the ownerthe best shot at constructing the right solution the first time. I see more andmore projects using some variation of design-build with legislation modifyingexisting laws to facilitate this change. Contractors will most likely have toadd technical capabilities to the team through either joint ventures or directlyhiring qualified engineers. This will probably restrict the number ofprojects available to the small- to medium-sized rehabilitation companies.


The topic of quality assurance/quality control(QA/QC) has been much discussed recently. How can a good approach to QA/QCbenefit a trenchless project and the industry in general? What steps need to betaken to help ensure that a QA/QC program is used?

Muenchmeyer: A good approach to asuccessful trenchless project is to prepare specifications that are detailed andcontain sufficient data for a contractor to effectively estimate and bid theproject. Typically, project components that are not detailed in thespecifications will result in unbalancing of the bid or unexpected projectcosts. The QA/QC plan must be outlined in the specifications and the contractormust understand the associated contractual obligations. Quality assurancerequirements tied to detailed quality control efforts in the field must beoutlined together with required testing at certain points in the project.Testing must be realistic and timely and unacceptable results must be resolvedin a timely manner. Project inspectors who are trained in the specifictechnology are essential.

Kozman: In order to establish a good QA/QCprogram, the engineer and owner must understand the limitations of thetechnologies specified and clearly state the objectives of the project. Thecurrent trend is to develop performance-based specifications that can be used toestablish a minimum level of acceptance. This may include product-specificrequirements or broader initiatives such as I/I abatement goals. QA/QC ismaintained on trenchless projects through regular physical inspections andproduct testing. The three keys to a successful QA/QC program
arecommunication, education and execution. A QA/QC program typically goes awry whenthe objectives are misunderstood or miscommunicated, the program participantsare not well versed in the technology or established procedures are notfollowed.

Trahan: A good QA/QC program is a necessarycomponent in achieving a quality project. However, no QA/QC program can assurequality results without a competent contractor with well-trained crews and acompetent and well-trained inspector looking over the work. The industry isseverely lacking in both contractor competency and inspector competency. If thecontractor selection process doesn’t allow the use of quality and competency inthe selection process, then why would there be an expectation that high qualitywould be achieved? The solution is for quality to be a critical part of theselection process, which means the essential elimination of the low-bidaward.

Habibian: The future growth of thetrenchless industry depends to a large extent on the quality of the workproduced. Oftentimes, one bad project casts a dark cloud on a technology and itis very difficult to remove such clouds once they are cast. Education is the keyin increasing the awareness of all the parties involved in the process on theimportance of QA/QC. Specification requirements should be beefed up to ensureproper QA/QC procedures are put in place.

Kampbell: QA/QC is such a misunderstoodsubject; but a good approach to QA/QC will make good installations routine withlife expectancies consistent with the research that supports the methodologiesemployed. Good QC/QA will make the cost of rehabilitation go up somewhat in thenear term, but will produce more cost-effective results and better contractors.In order to have good QC/QA, the engineer must first fundamentally understandthe installation (manufacturing) process for a given methodology. He/she mustthen require that contractors submit as a normal course of business the controls(the quality controls) that they need to achieve the required end results (whichis the quality assurance). The quality assurance items (i.e., fit, finish,thickness, materials properties, etc.) should be clearly specified in thecontract documents. The steps that must be taken are: (1) engineers must becometrained in the technologies available; (2) the approach to contract documentsshould become more performance focused with appropriate submittals to allow theengineer to support the contractor’s approach; (3) the quality assurance testingshould become the engineer’s expense so that it is his/her relationship with thetesting laboratory in this very key element; (4) more emphasis must be placed onthe quality and capabilities of the contractor in the solicitation process(commensurate with the size of the project); and (5) the performance documentsneed to clearly convey what the owner expects the work to deliver.

// ** Advertisement ** //
// ** Advertisement ** //

See Discussion, Leave A Comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.