Template revised April 12, 2018.
COMMISSION
AGENDA MEMORANDUM
Item No.
8g
ACTION ITEM
Date of Meeting
February 26, 2019
DATE: February 19, 2019 (Corrected March 7, 2019)
TO: Stephen P. Metruck, Executive Director
FROM: Kathy Bahnick, Manager, Remediation Programs
Roy Kuroiwa, Sr. Environmental Program Manager
Catherine Chu, Capital Project Manager
SUBJECT: Terminal 30 Former Chevron Site Cleanup
Estimated contract awards:
Up to $2,000,000
Total estimated project cost:
$4,100,000
ACTION REQUESTED
Request Commission authorization for the Port to advertise and execute construction contract
for the Terminal 30 (T-30) Environmental Cleanup Project for estimated contract award up to
$2,000,000. There is no funding request associated with this authorization.
EXECUTIVE SUMMARY
On March 8, 2016, the Port Commission authorized staff to execute a Consent Decree with the
Washington State Department of Ecology (Ecology) for the design and implementation of T-30
Cleanup project and to execute consultant services contracts for the design phase of this
project. The Consent Decree has been in effect since July 2017 and the Port has completed the
design and received Ecology’s approval to proceed with construction. This request is for the
Commission to authorize the Port to proceed with construction advertising and construction
contract execution. Funding for this work was included in the 2019-2023 Environmental
Remediation Liability (ERL) Program.
T-30 was purchased in 1985 from Chevron and has subsurface soil and groundwater petroleum
contamination because of Chevron’s past use. The Port has been under an Ecology Agreed
Order since 1991, during which time several investigations and interim actions (hot spot soil
removals and product recovery) were completed. However, some contamination is still present
at the site.
The project will have minimal impact to the surrounding area and the project team has been
working with the Northwest Seaport Alliance and T-30 Customer SSSA closely to minimize
construction impacts to business operations.
COMMISSION AGENDA – Action Item No. 8g Page 2 of 4
Meeting Date: February 26, 2019 (Corrected March 7, 2019)
Template revised September 22, 2016; format updates October 19, 2016.
JUSTIFICATION
One of the Port’s Century Agenda strategic objectives is to be the greenest, and most energy
efficient port in North America. This project is required under a Consent Decree between the
Port and Ecology executed in July 2017, with the overall goal to protect human health and the
environment.
Diversity in Contracting
Project staff is working with the Diversity in Contracting Department (DCD) to establish
appropriate WMBE aspirational goals based upon the identified scopes of work.
In addition to the WMBE goal, project staff will be assisting DCD staff in their outreach and
promotional efforts regarding this project.
DETAILS
Scope of Work
The proposed cleanup under the 2017 Ecology Consent Decree includes the following:
• Air sparging and soil vapor extraction of petroleum vapors, and treatment of exhaust
vapors. This involves pumping air into the soil via a series of shallow wells to assist the
bioremediation of petroleum;
• Petroleum hydrocarbon free-product recovery and disposal;
• Long term monitoring and reporting.
Schedule
Activity
Commission design authorization
Design start
Commission construction authorization
Construction start
In-use date
1
st
year operation and monitoring start
Cost Breakdown (including contracts and Port costs)
Design (costs to date) phase
$1,000,000
Construction (2019)
$2,500,000*
First year operation and monitoring (2020)
$600,000
Total
$4,100,000
*Up to $2 million construction contract award plus additional soft costs such as design support,
construction management, and project management.
COMMISSION AGENDA – Action Item No. 8g Page 3 of 4
Meeting Date: February 26, 2019 (Corrected March 7, 2019)
Template revised September 22, 2016; format updates October 19, 2016.
Construction contracting costs are estimated to be under $2 million. Total estimated cost for
design, construction, and first year operation and monitoring phases is $4.1 million.
ALTERNATIVES AND IMPLICATIONS CONSIDERED
Alternative 1 – Do not comply with the Consent Decree. Not complying with the Consent
Decree could result in the issuance of a unilateral Ecology enforcement order to perform the
work or Ecology may elect to perform the work themselves.
Cost Implications: $9 million plus possible fines
Pros:
(1) It may delay spending by a year or more while Ecology prepares an enforcement
order, or Ecology performs the work and compels the Port to reimburse Ecology for it.
Cons:
(1) If Ecology issues a unilateral enforcement order, the Port would still ultimately
perform the required cleanup actions and may also be liable for civil penalties of up to
$25,000 per day for each day it refuses to comply (per the Agreed Order, 1991).
(2) If Ecology elects to perform the work themselves and bills the Port for their work, it
would eliminate Port control over the cleanup activity and likely result in a significant
increase in cleanup construction and operation scope and costs, as well as possible
impacts to the tenant. The costs to the Port for an Ecology-lead cleanup could be up
to $9 million.
(3) Not performing this work may question the Port’s commitment to public health and
stewards of community resources and the environment.
This is not the recommended alternative.
Alternative 2 – Authorize advertising and execution of construction contracts to comply with
the Consent Decree.
Cost Implications: $4.1 million (design, construction, and first year operation and monitoring)
Pros:
(1) This alternative would result in compliance with Ecology’s Consent Decree and facilitate
cleanup design and implementation.
(2) This alternative demonstrates the Port’s value of responsible stewards of community
resources and the environment.
Cons:
(1) Cost of $4.1 million
This is the recommended alternative.
COMMISSION AGENDA – Action Item No. 8g Page 4 of 4
Meeting Date: February 26, 2019 (Corrected March 7, 2019)
Template revised September 22, 2016; format updates October 19, 2016.
FINANCIAL IMPLICATIONS
Annual Budget Status and Source of Funds
There is no funding request as part of this authorization. Funding for the associated costs is
included in the annual Environmental Remedial Liability (ERL) authorization. Cost recovery
from the former owner Chevron is unavailable by the terms of the purchase and sale
agreement. In addition, the Northwest Seaport Alliance (NWSA) Charter states that remediation
of contamination that occurred on licensed property before the effective date shall be the
responsibility of the homeport that owns such licensed property, unless remediation is driven
by NWSA development or operation.
The total estimated cost of $4.1 million for design, construction, and first year operation and
monitoring was included in the five-year forecast (2019 through 2023) in the Commission’s
2019 ERL spending authorization, approved on November 13, 2018. Any additional costs that
might be required, including long-term operation and monitoring costs will be recorded as a
liability and a non-operating expense in accordance with Port Policy AC-9. These amounts will
be reported annually to the Commission via routine ERL reports and spending authorization
requests.
The primary source of funds to pay the costs for the project will be ERL non-operations funds
from the Port’s Tax Levy.
ATTACHMENTS TO THIS REQUEST
(1) Terminal 30 Former Chevron Site Cleanup PowerPoint slide presentation
(2) Executed Consent Decree Re: Terminal 30 Site
PREVIOUS COMMISSION ACTIONS OR BRIEFINGS
November 13, 2018 – The Commission authorized (1) the Executive Director to spend
environmental remediation funds for 2019 in the amount of $17,025,000 and (2)
approved a five-year spending plan for $116,026,000 for the environmental
remediation liability (ERL) program for 2019-2023, of which an amount estimated not
to exceed $30,000,000 will be obligated during 2019 to be spent in future years.
March 8, 2016 – The Commission authorized execution of the Consent Decree and
execution of design contracts.
October 23, 2013 – The CEO signed an amendment to the 1991 AO that directed the Port to
prepare a draft Cleanup Action Plan that describes the preferred cleanup alternative
July 23, 1991 – The Commission authorized execution of an Ecology Agreed Order that
directed the Port to: a) continue product removal and groundwater monitoring; b)
prepare a T-30 RI/FS; and c) prepare a final Consent Decree with Ecology.