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Cities of Tampa and St. Petersburg, Florida Mayor Dick A.
Greco, City of Tampa Mayor David J. Fischer, City of St.
Petersburg Contact: DESCRIPTION OF PARTNERSHIP ARRANGEMENT Tampa Bay Water (TBW), the regional water utility, entered
into a 30-year Partnership with Poseidon Resources and Stone and Webster to
build, own, operate, and eventual ownership transfer (BOOT) for a 25-mgd
desalinization plant. TBW signed the agreement in July of 1999. TBW solicited a
performance request for proposals to include water quantity and quality, and a
specific interconnection location. The choice of technology, location of the
plant, and financial structuring was left open to the private partner. The
25-mgd plant is planned to expand after five years to 35-mgd in capacity. All
water from the plant will continue to be used by the utility. Poseidon and Stone
and Webster are responsible for providing a 14-mile interconnection pipeline to
the existing distribution network. Customer service, including metering,
billing, and collections will remain the utility's responsibility. The capital investment for the project is valued at $110
million, while the value of the cumulative contract is worth $600 million.
Poseidon Resources will finance the infrastructure investment in a 90/10
debt-equity structure. Poseidon will invest an equity portion of 10 percent, and
arrange, in conjunction with Tampa, St. Petersburg and surrounding
municipalities, to finance the remaining 90 percent with tax-exempt debt.
Poseidon will own the plant, but at the end of the Partnership term it will
transfer ownership to the utility. ESTIMATED/ACTUAL COST SAVINGS—Capital Upgrades, Consumer Rates, and
Fees
Rate setting for residential consumers will continue to be set by Tampa Bay
Water. The participating cities will realize significant savings. Currently the
cost of water is roughly $3/1,000 gallons, but the cost under the Partnership
agreement is expected to be $2/1,000 gallons. This cost savings is anticipated
to be worth roughly $300 million over the life of the Partnership. There will be no concession fees paid by Poseidon Resources to any of the
Cities or to Tampa Bay Water. LABOR RELATIONS Poseidon Resources and Stone and Webster anticipate hiring 12 full time
employees to operate the plant. |
J. Thomas Cochran, Executive Director
1620 Eye Street, NW, Washington, DC 20006
Telephone (202) 293-7330, FAX (202) 293-2352
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