1. UPDATE ON DWSD’S LONG TERM CSO CONTROL PLAN Presented to: Board of Water Commissioners May 12, 2010

2. Topics to be Covered 1.System Configuration Before CSO Controls (pre-1995) 2.CSO Controls 1995 – 2008: Rouge River National Demonstration Grant Projects Original (1996) Long Term CSO Plan Projects 3.Recent Developments Submittal of Long Term CSO Plan Update (October, 2008) Financial Crisis: Termination of URT($1 B) and DRO-2 ($300 M) Analysis of less costly CSO Alternatives (2009 – 2010) 4.Recommended Future CSO Control Projects: Future Rouge River CSO Control Facilities Green Infrastructure Program Future Detroit River CSO Control Facilities

3. Pre-1995 CSO Discharges in Detroit 76 permitted outfalls (33 to Rouge River and 43 to Detroit River) ~ 50 discharge events/year (average); ~ 20 billion gallons discharged/year; Major impact on Rouge River water quality:  Dissolved Oxygen depletion  Bacteria exceedances  Sediment deposits and bank erosion Lesser impacts on Detroit River:  Bacteria exceedances

4. Location of Pre-1995 CSO Outfalls

5. 1989 NPDES Permit: Original CSO Control Requirements 1989 NPDES Permit initially required ALL Rouge River CSO Outfalls to be treated/disinfected by Retention Treatment Basins by August, 2005; DWSD contested the permit and then negotiated a settlement requiring:  3 “Demonstration” Basins: Hubbell-Southfield; Puritan-Fenkell and 7 Mile West (constructed in 1995-1996);  6 In-System Storage “Task 1” control gates (installed 1996)  Prepare a “Long Term CSO Control Plan” (submitted July, 1996)

6. 1996 Long Term CSO Control Plan Recommended Projects WWTP Primary Treatment Capacity Increase Conner Creek CSO Basin Leib Screening & Disinfection Facility St. Aubin Screening & Disinfection Facility Baby Creek Screening & Disinfection Facility Upper Rouge CSO Tunnel (“URT”) Additional In-System storage gates Belle Isle CSO Basin* Oakwood CSO Basin, P. Station & Sewer Improvements* * Projects added after the Long Term Plan was submitted in 7/96

7. Detroit’s CSO Facilities (as of 2008)

8. CSO Project Costs (Construction Start ) Hubbell-Southfield Basin (1994): $ 58.9 M Puritan-Fenkell Basin (1995)$ 18.1 M 7 Mile Basin (1996):$ 14.9 M Task 1 In System Storage (1996): $ 3.4 M St. Aubin S&D Facility (1999): $ 19.8 M Leib S&D Facility (1999):$ 33.4 M WWTP Expansion (2000):$ 101.2 M Conner Creek CSO Basin (2001)$ 201.4 M In-System Storage Devices (2002):$ 30.8M Baby Creek S&D Facility (2003): $ 76.1 M Belle Isle CSO Basin (2005):$ 16.1 M Oakwood Basin & P. Sta. (2007)$ 168.7 M Oakwood Sewer Improvements (2008) $ 15.0 M $1,593 M

9. Benefits of CSO Control Program

10. October, 2008 Update to Long Term CSO Control Plan Assumed completion of URT tunnel by 2015 (construction to begin on 1 st tunnel segment in 2008) Recommended that 41 Detroit River CSO outfalls be controlled with innovative Disposable Net + In-Pipe Disinfection technology Work to be undertaken over 20 year period: 2010 – 2030 Estimated construction cost = $ 185 M (2009 $) MDNRE informally expressed concurrence with the Plan recommendations, but has not responded in writing

11. Original Upper Rouge CSO Tunnel Schematic Drawing

12. Key Facts re: Upper Rouge CSO Tunnel 30′ diameter tunnel; 7 miles long; 150’ underground 215 million gallons capacity Would reduce CSO discharges to < 1/year Controls 17 Detroit CSOs and 11 suburban CSOs Includes 100 mgd Pump Station and 14 Drop Shafts 10 surge control surface structures in Rouge Park Construction period: 2008 – 2015 Construction cost = $880 million as of 2/09; expected to escalate to $1 billion after all 8 contracts bid 83% of costs allocated to Detroit customers

13. Projected CSO Debt Load with URT Tunnel

14. DWSD’s Permit Modification Request due to Economic Hardship MDNRE approval sought to eliminate URT Project and DRO- 2 Outfall based on economic hardship, including: Population Decline/Loss of Customer Base Job Losses and Manufacturing Declines Housing Data: SEV, Taxable Value Water Sales; Projected Revenues and Rates Actual CSO Control Project Expenditures >> Estimates Detroit sewer costs as a % of Median Annual Household Income > EPA’s 2% threshold for “affordability”

15. NPDES Permit Requirement re: Study of CSO Control Alternatives DWSD required to analyze alternative CSO Controls Initial report due: December 15, 2009 Initial recommendation: Build $484 M smaller CSO tunnel (“URT-2”) with ~ 3.2 untreated overflows/yr MDNRE requests 90 day Supplemental Study to examine other alternatives to avoid dispute on approvability of URT-2 recommendation Supplemental Report submitted April 30, 2010

16. 1.Reduce capital cost as much as possible; 2.Utilize an extended implementation schedule to reduce impact on rate payers and allow time for Detroit’s economic recovery; 3.Minimize O&M costs by limiting the number of new CSO facilities; 4.Achieve in-stream water quality comparable to what would have resulted from the URT project; 5.Incorporate “Green Infrastructure” activities to the extent they are feasible, cost effective and beneficial (i.e. reduce or retard runoff); 6.Consider the cost impacts of ongoing projects (Oakwood, Baby Creek remedial measures, TRC Minimization, etc.) as part of the overall CSO program implementation schedule. Guiding Principles for CSO Alternative Evaluation

17. Alternatives Evaluated by DWSD Conventional CSO Technologies: Storage Tunnels Retention Treatment Basins Vertical Shafts West Arm Interceptor Extension Screening & Disinfection First Flush Tanks Disposable Nets w/Disinfection Vortex Separators In-System Storage Green Infrastructure Options: Downspout disconnection Re-vegetate vacant lots Bioswales & rain gardens Rain Barrels Green roofs Tree planting/Urban Forest Demolish abandoned structures Porous Pavement Curb bump outs Roadside Tree Trenches

18. Supplemental Report Recommendations Replace URT tunnel with a series of innovative, end-of-pipe treatment systems consisting of:  First Flush storage tanks at multiple outfalls  Connecting sewers to eliminate small outfalls  Disposable Net installations to screen out sanitary trash  Disinfection by chemical injection of NaOCl into existing sewers far enough upstream from overflow point to allow contact time for effective bacteria kill Limit capital expenditures for CSO Projects to < $35 M/yr to stay within Detroit’s Financial Capability Establish a 25 year schedule for program (including both Rouge River and Detroit River CSO outfalls) Implement a Green Infrastructure program to reduce stormwater flow tributary to combined system Demonstrate new CSO control technology with Pilot Projects

19. Ongoing Projects ($63 Million): Oakwood Sewer Improvements (3 remaining segments): $59 M Baby Creek Remedial Measures (NaOCl feed, mech. mixers, emerg. bypass): $3 M TRC Minimization & In-Stream Assessments: $1 M New Projects ($791Million): Hubbell-Southfield Basin Improvements: $3 M Task 1 In System Gate renovations: $5M Carbon, Fort St. Outfall eliminations: $1 M 2 Pilot Projects (First Flush Tank + Disp. Nets w/disinf.) @ 7 Mile East & Pembroke: $41M Glenhurst outfall diversion and pump station: $3 M Replace URT Tunnel with First Flush Tank/Disposable Net/In-Pipe Disinfection @ 383 M RRO-2 shallow conduit in lieu of DRO-2 outfall (2 construction contracts): $130 M Re-invest in existing CSO Control Facilities: $40 M Control of Detroit River CSO Outfalls using Disposable Nets/In-Pipe Disinfection @ $185M Recommended Conventional CSO Control Projects

20. Comparison of URT and Current Recommendation for Upper Rouge Outfalls Original “URT” 30’ Diameter 7 Miles long 201 MG capacity 17 CSO Outfalls 100 MGD Pump Station Includes Redford, Dearborn Hts flow 1 Overflow/yr (untreated) 850,000 gal/yr discharged (untreated) $880 Million capital cost $1.5 Million annual O & M cost 2008 Construction Start Concurrent Tunnel Contracts 7 Year Construction Period $126 M/yr Avg Cost (over 7 year constr. period) First Flush Tank Alternative 9 First Flush Tanks 13 Outfalls w/Disposable Net Installations 13 Chem. Storage/Pumping Sites > 24 Chemical Injection Points 34.6 MG capacity Includes Redford, Dearborn Hts flow ~ 13 Overflows/yr (treated) 1.2 B gal/yr discharged (treated) $ 426 Million capital cost $2.83 Million annual O & M cost 2012 Construction Start: Pilot Projects Only Sequential Construction Contracts 25 Year Construction Period $20 M/yr Avg Cost (over 25 year constr. period)

21. Recommended “Green Infrastructure” Program Rationale for including Green Infrastructure: Expected to reduce inflow to combined sewers by at least 10% - 20% upon completion; Provides quick water quality benefit while conventional CSO facilities are designed, sited, financed and built; Acknowledges the ongoing demographic and population changes that are profoundly affecting the tributary area; Consistent with the Mayor’s objective to remove abandoned homes and deal with urban blight Consistent with approach being used in many other urban areas (Philadelphia, Portland, Cincinnati, Washington D.C.)

22. Proposed “Green Infrastructure” Activities Disconnect residential downspouts and, where feasible, commercial and industrial downspouts; Demolish and remove vacant structures, seal pipes and re-vegetate the parcel to return it to pervious cover; Use bioswales and tree trenches along roadways and parking lots to intercept runoff and reduce stormwater inputs; Plant trees for uptake and evapotranspiration along roadways and open spaces; Implement activities on municipally-owned land, focusing on managing stormwater runoff in under-utilized parks

23. Phasing Of Recommended Projects Proposed Implementation Schedule: > 25 years (beyond 2034); Stage Projects in multiple 5-Year Phases; Spread out new CSO Project construction to average <$35 Million per year as a target “manageable” level of new debt; Accelerate funding of Green Infrastructure projects early in the implementation plan to achieve immediate beneficial results while conventional facilities are designed and built; Green Infrastructure Budget Recommendation: $3 Million/Year for first 10 years (2010 – 2019) $2 Million/Year for next 10 years (2020 – 2029) In addition to these DWSD sewer revenues, also pursue grants, loans, support from foundations and private stakeholders

24. Recommended Phase I CSO Control Projects (2010 – 2014) PHASE I (2010-2014) : Const. Cost: Oakwood Sewers Segments 2,3: $44 M Baby Creek Remedial Measures: $ 2 M Carbon, Fort St outfall elimination: $ 1 M TRC Minimization + In-Stream Evaluations: $ 1 M Hubbell-Southfield Improvements: $ 3 M Task 1 In-System Gate renovations: $ 5 M Pembroke outfall First Flush Pilot Project: $24 M RRO-2 segment 1 (WWTP work):$30 M Green Infrastructure Program:$15 M PHASE I SUBTOTAL:$125 M

25. Recommended Phase II CSO Control Projects (2015 – 2019) PHASE II (2015-2019): Const. Cost: Oakwood Sewers Segment 4:$ 15 M 7 Mile East Pilot Project:$ 17 M Glenhurst Pump Station/Diversion:$ 3 M RRO-2 Segment 2 (outfall conduit):$100 M Re-investment in existing CSO facilities:$ 10 M Detroit River CSO Outfalls*:$ 34 M Green Infrastructure Program: $ 15 M PHASE II TOTAL:$194 M * specific outfalls to be undertaken in Phase II not yet identified

26. Future Phases (2020 and beyond) Continue Green Infrastructure Program through 2029 @ $2 M/Yr ($50 M total Green investment); Continue re-investment in existing CSO Control Facilities; Undertake new CSO Control Facilities along Rouge River and Detroit River based on re-evaluation of Detroit’s Financial Capability every 5 years (presumably Disposable Nets with In- Pipe Disinfection Systems assuming Pilot Projects demonstrate that the new technology performs as expected)

27. Factors That Could Affect CSO Schedule Time period needed by Detroit to achieve economic recovery; Financial solvency of the City and ability to sell bonds to finance capital improvements; Demographic changes in the tributary area which affect wet weather flows; Green Infrastructure progress and stormwater flow reductions actually achieved; Availability of low interest SRF loan money or grant funding; Expenditures needed for new regulatory requirements (e.g. de-chlorination); Need for additional re-investment in existing CSO facilities; Cost of non-CSO capital improvement projects

28. Comparison: Then and Now ( 2008 vs 2010 CSO Program Costs) 2008 Projects: URT (201 MG)$1,000M Oakwood Sewers$ 59M Baby Creek$ 2M Carbon/Fort St elimination$ 1M TRC Minimization$ 1M WWTP outfall (DRO-2) $ 299M Future Detroit River CSOs$ 185M TOTAL $1,547M Average Cost/Yr 2008 - 2015: $169 M/yr Note: 2008 CSO Program did not included a budget for ongoing re-investment in existing CSO facilities. 2010 Projects: 2 Pilot Projects: $ 41 M Glenhurst outfall $ 3 M Remaining Upper Rouge Outfalls $383M Oakwood Sewers $ 59 M Baby Creek $ 2M Carbon/Fort St elimination $ 1M TRC Minimization $ 1M Task 1 Gate renovation: $ 5 M RRO-2 outfall $130M Re-invest in CSO Facilities $ 43M Future Detroit River CSOs $185M SUBTOTAL $ 853 M Green Infrastructure $ 50 M TOTAL $ 903 M Average Cost/Yr 2008 - 2015: $ 21 M/yr

29. Comparison of 2008 and 2010 CSO Control Programs (estimated construction cost/yr)

30. Next Steps Meet with MDNRE to negotiate CSO project schedules MDNRE to modify NPDES Permit with new CSO project schedule Design Pembroke Pilot Project for First Flush Tank + Disposable Net + In-Pipe Disinfection System Design new RRO-2 outfall (1 st segment @ WWTP) Develop and implement Green Infrastructure program (with other City Departments) Complete TRC Minimization Program and evaluate alternative disinfection systems

31. Questions