Asset Management NPDES Requirements and Coordination with SAW Presented at MWEA Process Seminar November 5, 2014 Phil Argiroff, P.E. MDEQ - WRD 1
Water Resources Protect and Monitor 4 Great Lakes 3,288 miles of Great Lakes shoreline 11,000 inland lakes 36,000 river miles 5.5 million acres of wetlands 70,000 acres of critical dunes For swimming, fishing, drinking water and aquatic ecosystems. 2
Framework of Presentation What is DEQ s posture on AM, and what is AM Discuss status of AM Program implementation in NPDES permits Briefly discuss SAW program; for Asset Management Present how AM requirements can be coordinated with Stormwater/Asset Management/Wastewater (SAW) grant 3
MDEQ s Posture on Asset Management (AM) Governor s 2011Infrastructure Message - sustainability and AM for wastewater and water DEQ is supportive of AM for wastewater and water DEQ has started a NPDES regulatory initiative for WWTPs/collection systems, and now has a state grant program (SAW) for AM with the potential for a grant Assistance for AM program development 4
What is an Asset? In wastewater systems, an "asset" is a component of a facility with an independent physical and functional identity and age (e.g., pump, motor, clarifier, etc.). 5
Asset Management is maintaining a desired level of service for what you want the assets to provide at the lowest life-cycle cost. Lowest life-cycle cost refers to the best appropriate cost for rehabilitating, repairing or replacing an asset. 6
Asset Management is a framework being widely adopted as a means to pursue and achieve sustainable infrastructure. 7
Five Core Questions of AM 1. What is the current state of my assets? 2. What is my required "sustainable" level of service? 3. Which assets are critical to sustained performance? 4. What are my minimum life-cycle costs? 5. What is my best long-term funding strategy? 8
AM Programs A high-performing asset management program incorporates detailed asset inventories, operation and maintenance tasks, and long-range financial planning to build system capacity, and it puts systems on the road to sustainability. 9
Benefits of AM Prolonging asset life and aiding in rehabilitation, repair and replacement decisions through efficient and focused operations and maintenance Meeting consumer demands with a focus on system sustainability Setting rates based on sound operational and financial planning Budgeting focused on activities critical to sustained performance 10
Benefits of AM (cont.) Meeting service expectations and regulatory requirements Improving responses to emergencies Improving the security and safety of assets Reducing overall costs for both operations and capital expenditures 11
MDEQ s Efforts to Include AM in NPDES Permits Started in FY2013, adding AM program requirements to all reissued major municipal WWTP permits The first with this requirement was Detroit WWTP - 33% of treated municipal discharge in MI, history of poor equipment maintenance. Appropriate to be first with AM requirements Summary of core requirements current state, level of service, critical assets, minimum life cycle costs, and long term funding Will add AM requirements to minor permits that receive AM grants 12
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What is an Asset? 14
AM NPDES Permit Language Both Parts 31 and 41 of NREPA, PA 451 allow us to implement requirements Permit Language Requires an Approvable AM Plan to implement the AM Program, addressing: Staffing Mapping Collection System Inventory, Assessment, and Criticality of Fixed Assets Budget and Rate Sufficiency Annual Report 15
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DEQ/SAW Program The Great Lakes Water Quality Bond 2002 PA 562 of 2012 authorized money for Stormwater, Asset Management Wastewater or SAW program $450M is allocated to provide grants and loans for SAW. $97M was available for FY 2014, and $97M is available for FY 2015 Grants are available up to $2M per municipality Applications were accepted starting Dec 2, 2013 on a first come first served basis. On December 2, 2013 673 applications totaling $541M were received. 17
Financial Assessment Program DEQ reviews financial and legal documents Onsite visit DEQ prepares a Financial Action Plan Follow-up as necessary Asset Management /CUPSS 18
Asset Management Plan Workbook Rate Methodology Table 4 Asset Inventory Table 1 Directions A. List assets B. Enter asset information C. To add more assets use insert function D. Enter information in highlighed cells E. Remaining cells will calculate automatically. A B C D O P Q Collection Assets Capacity Material Location Probability of Failure Criticality of Asset Business Risk Pump #1 5 5 25 Enter asset 5 5 25 Enter asset 3 3 9 Enter asset 0 Enter asset 0 Enter asset 0 Enter asset 0 Directions A. To add more line item expenses use insert function and add rows then copy first line item row to new rows to transfer formulas B. Enter information in highlighed cells C. Remaining cells will calculate automatically. (select one) (select one) <<< Click at left and select flow units (million cubic feet or millions of gallons) <<< Enter annual billable flow in units selected 0.00 above <<< Enter typical quarterly flow of singlefamily home in units selected 0 above <<< Click at left and select the type of fixed units 0 <<< Enter number of fixed units Expenditures Budget Option 1 Option 2 Variable Fixed 100% 100% Operatio n, Maintena nce and Repair (OM&R) Salaries $ - $ - $ - * Insurance $ - $ - $ - * Dental $ - $ - $ - * MERS $ - $ - $ - * Medicare $ - $ - $ - * FICA $ - $ - $ - * Disability $ - $ - $ - Unemploy ment Insurance $ - $ - $ - Postage $ - $ - $ - Bank Charges $ - $ - $ - Calculate Rate Option 1 Option 2 Flow units $ $ - Fixed units $ - S Quarterly Bill for single-family home $ $ 19
EPA Resources EPA has a Sustainable Infrastructure webpage devoted to water and wastewater systems: http://water.epa.gov/infrastructure/sustain/ Click on Asset Management Includes links to a number of AM guidance documents Asset Management: A Best Practices Guide Building an Asset Management Team Asset Management: A Handbook for Small Public Water Systems STEP Guide Series 20
Coordination of NPDES requirements with a SAW grant NPDES permit requirements are not contingent upon being awarded a SAW grant However, within reason the schedule of AM implementation can consider a grant 21
Lessons Learned Lots of tools out there Time consuming but doesn t have to be expensive AM is a long term program incremental steps Regulations in place for NPDES, SAW for assistance DEQ is adjusting permit language as we are implementing the program DEQ is working on providing better outreach 22
Questions Contacts: Phil Argiroff, P.E., Permits Section Chief argiroffp@michigan.gov 517-290-3039 Matt Staron, P.E., Permits Section staronm@michigan.gov 517-335-4491 Charlie Hill, P.E. Wastewater Specialist hillc@michigan.gov 906-228-4527 23