Dec 28, 2000

U.S. Water Receives $263 M to Manage Wastewater Treatment

The Springfield, Mass, Water & Sewer Commission awarded Bolingbrook, Ill.-based U.S. Water LLC a 20-year contract worth $263 million for managing its 67-mgd wastewater treatment plant, 29 sewage pumping stations, combined sewer overflow operations and system residuals disposal. The plant serves a population of 275,000, covering seven municipalities including the City of Springfield.

"The award of the Springfield contract is a clear example of how U.S. Water achieves results for its clients by using a team approach, creative thinking and good old fashioned hard work," said Michael Belsante, president and chief executive officer of U.S. Water. "Springfield benefits from the vast technical expertise of U.S. Water and its parent companies and receives quality service at a significant cost savings."

The largest water privatization contract in New England was secured for U.S. Water by a five-person negotiating team of senior executives from U.S. Water. Bechtel Enterprises and United Utilities, U.S. Water's parent companies, guaranteed U.S. Waters price and performance. The guarantees are joint and several and capped at $100 million.
The Springfield contract includes about $10.4 million in capital projects. U.S. Water will be responsible for delivering the improvements within the first two years of the contract.

In approving the transaction, the Commission acknowledged the many benefits of privatization, such as transfer of risks to the private sector. The Springfield contract incorporates a unique sharing mechanism for risks associated with market conditions and change in law for sludge disposal.

In addition, U.S. Water will manage the Commission's compost contract. Given the sensitivity of the Commission and the community to odors, the contract gives the Commission the right to sanction the company if it fails to meet its odor control commitments. U.S. Water has a distinct company policy to address odor issues at the plants that it operates.

(Source: U.S. Water)

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