They’ve done projects all around the world, including Antarctica. They’ve developed a reputation for quality and cost-effectiveness, for bringing in specialized building teams and matching them with regional subcontractors.
They also come with a bit of controversy.
Meet your water project contractor, to be paid for with public funds.
Richard Pyle, head of the team that is going to design, build and operate the $228 million surface water project that will deliver Sacramento River water to Davis and Woodland, has 29 years of engineering experience.
He’s also a vice president of CH2M Hill, the firm that’s going to be at the helm of the project. It’s a global firm that operates in 149 countries, on every continent, and boasts 28,000 employees in 170 offices worldwide.
It grossed $7 billion in revenue in 2012, and is actively working in 80 countries and in multiple states across the nation. Based in Denver, it started in the 1940s in a small town in Oregon and grew and merged over the years into one of the world’s premier engineering firms. It has experience working on projects similar to what will happen at the Sacramento River, including the Buckman project for Santa Fe, N.M. That’s a project that diverts water from the Rio Grande.
CH2M Hill also ran into scandal. Between 1999 and 2008, the company had a contract to clean and manage 177 large underground storage tanks that contained radioactive and hazardous waste at the Hanford nuclear site in southeastern Washington state.
According to a settlement with the U.S. Department of Justice, CH2M Hill admitted to defrauding the public “by engaging in widespread time card fraud” that allowed workers to claim a full day’s work even though they hadn’t worked that many hours.
It’s a blemish in the past that Dennis Diemer, general manager of the Woodland-Davis Clean Water Agency, said needs to be considered in keeping with how large a company CH2M Hill is.
“It’s definitely a serious charge and one that the agency shouldn’t dismiss or take lightly,” he told the Davis City Council last year. “However, I think it’s important we keep it in perspective: CH2M Hill is an international company; they have annual revenues of over $6.1 billion, they have 30,000 employees and almost 24,000 active contracts.”
Perhaps more controversial was how CH2M Hill came to be selected against smaller firm Veolia Water North America.
The Woodland-Davis Clean Water Agency backed a process called design-build-operate, which was identified as the most cost-effective way of designing, building and running the water project because the same company would be involved in every step of the process. Veolia couldn’t put together a competitive team that could do all three, so it backed out of consideration, leaving CH2M Hill as the sole bidder.
At a public presentation last month in Davis, Diemer said the design-build-operate process was successful in helping cut costs. In 2009, the project was slated to cost Davis $155 million; that estimate now is $106 million.
The price tag for the project, which in 2009 was an estimated $350 million total between Davis and Woodland, has been substantially reduced to $228 million. Much of those savings are thanks to the Davis Water Advisory Committee, which had a role in shrinking the overall cost by recommending that the project’s capacity be cut by one-quarter, after a yearlong investigation two years ago.
CH2M Hill already has assembled its own team and has gathered up Bay Area subcontractors for the pipeline construction and other parts of the project, Pyle said.
“(The subcontractors) understand where to source the building materials in the area at a good price,” he said.
Construction on the water project will begin in April and finish sometime around September 2016.
In 2009, CH2M Hill started work on the Buckman diversion project at the Rio Grande in New Mexico. While only a design and build project, CH2M Hill operated the plant for six months while internal testing and regulators kicked the tires, so to speak.
“Generally, it’s similar (to the Davis project),” Pyle said. “In that case, we built the intake on the river, the raw water line, the plant and the treated water line to connect to the system.”
CH2M Hill teams move from project to project around the country, bringing with them the experience, like Buckman and others, to bear on current projects.
— Reach Dave Ryan at [email protected] or 530-747-8057. Follow him on Twitter at @davewritesnews