United States Office of Water September 1984 rental Protectior eae Operations (WH-547) 430/9-84-009 y \gton, DC 20460 Value Engineering For Wastewater Treatment WorksVALUE ENGINEERING FOR WASTEWATER TREATMENT WORKS Prepared for: Office of Water Program Operations (WH-547) United States Environmental Protection Agency Washington, DC 20460 Contract No. 68-01-6737 Prepared by: Contractor: Roy F. Weston, Inc. (West Chester, PA) Subcontractor: L-Z Associates, Inc. (Rockville, MD) EPA Project Officer: James Wheeler EPA Work Assignment Manager: Haig Farmer U.S. Environmental Protection Agency Region 5, Library (PL-12)) 77 West Jackson Boulevard, 12th Floor Chicago, IL 60604-3590FOREWORD The Environmental Protection Agency's value engineering pro- gram is an extremely successful element in its construction grants program. Over the seven-year period from 1977 through 1983, the value engineering program produced a $15 dollar return on each dollar invested in value engineering and a 5.4 percent net capital savings on $7.5 billion worth of total pro- ject costs. In addition to the obvious benefit of lowering capital costs for wastewater treatment facilities without sacrificing performance or reliability, the value engineering program produces additional benefits of operating and main- tenance cost savings and enhanced reliability for the facilities. Although value engineering is required on large wastewater pro- jects, the Agency encourages its use on smaller projects since they offer similar potentials for cost savings. This document provides users with state-of-the-art guidance for conducting value engineering on wastewater treatment pro- jects. The guidance document strives to: Promote broader use of value engineering; ® Increase the knowledge of the value engineering process; and . Improve the quality and effectiveness of value engineering in the construction grants program. With the positive application of the value engineering process described in this document, capital cost savings of five to ten percent plus additional operation and maintenance cost savings can be achieved for individual wastewater treatment facilities. Value engineering presents communities with an excellent oppor- tunity to reduce the present and future costs of their waste- water treatment projects.ACKNOWLEDGEMENTS The contribution of the following participants in the development of this guidance document is gratefully acknowledged. Prime Contractor Roy F, Weston, Inc., West Chester, PA Subcontractor L-2 Associates, Inc., Rockville, MD EPA Project Officer: James Wheeler, Municipal Construction Division Work Assignment Manager: Haig Parmer, Municipal Construction Division Key Individuals Document Development: Bradford Cushing, Roy F. Weston, Inc., West Chester, PA Haig Parmer, EPA, Washington, DC Larry Zimmerman, L-Z Associates, Inc., Rockville, MD Technical Consultation and Review: Alphonse Dell'Isola, Smith, Hinchman, and Grylls Associates, Inc. Roger Hyde, Roy F. Weston, Inc., Cleveland, OH Edward Nichols, Edward J. Nichols and Associates, Inc. Alexandria, VA Robert Williams, Culp/Wesner/Culp, Cameron Park, CA Technical Review: Bryan Chesson, EPA, Atlanta, GA Hubert Duckett, EPA, Kansas City, MO Glen Hart, Arthur Beard Engineers, Inc., Azusa, CA Arwin Hothan, EPA, Chicago, IL Ancil Jones, EPA, Dallas, TX David Wohlscheid, arthur Beard Engineers, Inc., Vienna, VA iiTABLE OF CONTENTS PAGE POREWORD....-e+eeee0e oe eeet ea i ACKNOWLEDGEMENTS... -+0+e0000+ ii LIST OF FIGURES......++ee+e00+ v LIST OF TABLES.......+++.-+ v SECTION 1 INTRODUCTION L.L Overview...sceceesceeeeeeeeeees 1-1 1.2 Purpose and Scope......-.+ 1-2 1.3 Benefits of VE.......eeeeee 1-2 1.4 History and Accomplishments 1-4 1.5 VE in the EPA Construction Grants Program.........+ 1-6 SECTION 2 MANAGEMENT OF VALUE ENGINEERING Qala Generales eee teenie ec 2-1 2.2 VE Sequence and Typical Schedule..... 2-1 2.3 Advertising for VE Consultant SErViced....sseccrsceceencreececessss 295 2.4 Response to the RPP (VB Consultant's Proposal) ....e.eseeseeeeee 2-6 2.5 Number and Timing of vE studies 2-7 2.6 VE Teat.....seeeeeeeeeee aes 2-8 2.7 VE Team Coordinator (VETC).........6. 2-12 2.8 Level of Effort......eseceseceeeseees 2-12 2.9 Selecting the VE Consultant....... 2-14 2.10 Types of Contracts for VE Services 2-15 SECTION 3 PREPARATION FOR THE VE WORKSHOP 3.1 Overview.......eeeeeeeee 3-1 3.2 Coordination Meeting.... 3-1 3.3 Technical and Cost Data. pre 3-2 314 VE Team Composition and Logistical ALTANGeMENtS.....-eeeeeeeeeeeeeee 3-5 3.5 Cost Estimates pee eee 3-5 316 Cost and Energy Modeis......... 3-6 iiiSECTION 4 SECTION 5 APPENDIX APPENDIX APPENDIX APPENDIX APPENDIX THE V: Loss: SELEC: WORKS! SAMPL TABLE OF CONTENTS (Continued) PAGE E WORKSHOP VE Job Plan.... el Information Phase..... ee 42 Speculative/Creative Phase... te 47 Zvaluation/Analytical Phase.......... 0 4-9 Development/Recommendation Phase..... 4-10 Report Phase... seeeee Mel WORKSHOP ACTIVITY Review of the VE Report.. - Se2 Final VE Report... : 2 Sel Reviewing Agency Coordination and Approval....e.esseeeeseeeeeees 5-3 ARY OF TERMS fT BIBLIOGRAPHY HEETS E VE REPORT SAMPLE FINAL VE REPORT ivLIST OF FIGURES FIGURE NO. PAGE 2-1 VE STUDY TASK FLOW DIAGRAM. .....0.ceeeeeeeeeeenees 202 2-2 VE PLOW DIAGRAM: NORMAL SEQUENCE (TWO VE STUDIES). 2-3 2-3 POTENTIAL VE SAVINGS VS. WORKSHOP TIMING.......... 2-7 3-1 EXAMPLE COST SUMMARY MODEL....... 3-11 3-2 EXAMPLE MATRIX COST MODEL......... 3-12 3-3 EXAMPLE COST MODEL... .....ceesceeseeseeseeneees 3-13 3-4 EXAMPLE ENERGY MODEL.......--eeeeeeeeeeeereeeee 3-14 3-5 EXAMPLE LIFE CYCLE COST MODEL........... 3-15 4-1 EXAMPLE FUNCTION ANALYSIS WORKSHEET............ 4-14 4-2 EXAMPLE FUNCTION ANALYSIS WORKSHEET FOR SUBSYSTEM. 4-15 4-3 EXAMPLE SPECULATIVE/CREATIVE PHASE WORKSHEET........ 4-16 4-4 EXAMPLE EVALUATION/ANALYTICAL PHASE WORKSHEET..... 4-17 LIST OF TABLES TABLE NO. 1-1 SUMMARY OF VE SAVINGS (EPA CONSTRUCTION GRANTS PROGRAM... 0c sseccssscrcesssccssesccscsereccsesse 197 2-1 IDENTIFICATION OF CONSTRUCTION COSTS..... + 2-10 2-2 TYPICAL LEVEL OP EFFORT FOR ONE VE STUDY.......... 2-13Lal 1.2 SECTION 1 INTRODUCTION OVERVIEW In 1974, the United States Environmental Protection Agency (EPA) started a voluntary program to encourage the use of value engineering (VE) in its construction grants program. Since 1976, the Agency's value engineering program has been a mandatory design element for all large wastewater treatment works. The success of this value engineering effort has improved the reliability of new wastewater treatment works while reducing their costs. Value engineering is a specialized cost control technique performed by an independent group of experienced professionals. The technique involves an intensive, systematic and creative study to reduce costs while enhancing reliability and performance. The technique is used to achieve the best functional balance between cost, reliability, and performance of a product, process, system, or facility. The value engineering effort provides a project designer with an additional source of engineering, construction, and operations expertise to enhance the project's design and operability. When the VE efforts are properly coordinated, they will not delay work on a project's design. A glossary of terms common to value engineering is presented in Appendix A. Users of this guidance document are encouraged to consult this glossary prior to a detailed reading of this document. PURPOSE AND SCOPE The purpose of this guidance document is to provide municipal authorities, state agencies, design engineers, and VE teams with state-of-the-art guidance for conducting effective VE studies on wastewater treatment works. This guidance document serves as a reference source for contracting, planning, performing, reporting, and evaluating value engineering studies. It also consolidates and updates the EPA's existing information and experience on value engineering. This document has not been developed as a training manual or textbook on value engineering. The value engineering techniques are adequately described in numerous texts on the subject. (Refer to the select bibliography in Appendix B).