1:
INITIAL OPERATIONS CHALLENGES

2: PROJECT
BACKGROUND

3: ALLIANCE
ACHIEVEMENTS

1: Initial Operations Challenges

• 
  The City of Cape Girardeau did not exercise
  control of its public water system, which was owned by
  a
  large private power utility.
• The power utility had elected to offer the
  water system for sale and rate increases on the order of
  35-50% were anticipated if the system were acquired by another
  private utility company.
• The water system needed major infrastructure
  improvements, including the prgggojected expansion of an aging
  surface water treatment plant and the replacement of undersized
  and deteriorating galvanized water mains.
• Additional rate increases would be necessary
  to fund major capital requirements.
• Lacking a water department, the City was
  faced with the complex task of forming a complete new
  utility,
  including professional and technical staff, all management
  and administrative resources, and policies and procedures.

2: Project Background

Following years of on again, off again
discussions, Cape Girardeau entered into earnest negotiation
with Union Electric Company in 1991 with an eye toward acquisition
of the water system serving city residents.

The City asked Alliance to provide the necessary
professional, business, and financial expertise needed for
contract negotiations, possible formation of a complete new
water utility department, and, if successful, management,
operations, and maintenance of the new water system.

On June 2, 1992, with Alliance’s assistance,
the City successfully acquired its water system and
began
providing municipal water service to its 35,000-plus citizens.
Well in advance of the startup, Alliance recruited and
trained
a complete new water staff to replace the departing Union
Electric staff.

Under a cost effective long-term agreement
with the City of
Cape Girardeau, Alliance provides complete water
system operation and maintenance services, including
operations of a
7.25 mgd
lime softning treatment plant and a 2.8 mgd alluvial
groundwater plant, distribution system maintenance, meter
reading,
and
full customer service.

Alliance has also provided substantial assistance
to the City and its consulting engineers with the upgrade
and expansion of their existing surface water plant to a
7.25 mgd lime softning plant and conversion of the raw
water source to alluvial wells.
This ambitious improvement program will allow the plant to
achieve full compliance with future drinking water regulations
and provide higher quality water to City customers.

3: Alliance
Achievements

• Alliance represented
  the City as a professional, technical, and financial consultant
  in negotiations with the water system owner, enabling the
  City to acquire the water system at a substantial discount
  off of book price.
• Under a contract O&M services
  agreement, Alliance recruited and trained a completely new
  staff, and achieved a seamless startup and transition to
  City ownership and management.
• Alliance assisted City staff with the development
  of policies, procedures, and business practices necessary
  for the formation of the new water department.
• In the first year of operation, Alliance
  reduced operating and maintenance costs to more than 25%
  below established levels. In the first five years of contract
  O&M services, Alliance produced operational and capital
  cost savings of more than $1.75 million.
• Alliance has replaced over 40 miles of
  corroding two-inch galvanized mains in the City distribution
  system.
• Despite an aging water plant, Alliance staff
  has dramatically improved water quality, achieving full
  compliance with drinking water regulations, and routinely
  producing finished water at turbidity levels below 0.1 NTU.
• In the “Great Flood” of 1993,
  the City’s raw water intake on the banks of the Mississippi
  River was inundated and unserviceable. Anticipating the
  loss, Alliance secured and installed three large diesel
  powered, portable pumps to temporarily replace the permanent
  intake with no interruption of service.
• Local media praised the Alliance/Cape Girardeau partnership for “a job well done.”
• Water line replacement normally requires extensive excavation and inconvenience for citizens. But Alliance worked hand-in-hand with the public works and engineering departments to accomplish replacement work in conjunction with the CityÕs street overlay program to minimize excavation of resurfaced streets.
• Alliance has worked with the City to institute geographic information system (GIS) mapping and database modeling of the water system. Hydrant locations, pressure and flow data and maintenance records are now easily accessed and more efficiently utilized.