Private Sector Expertise, Public Employees

The City of Winnipeg recently signed a 30-year wastewater agreement with Veolia North America. While there's nothing unusual with leveraging alternative delivery, there is something very different about the City's approach: It's never been done before.

Winnipeg wanted private-sector purchasing power and expertise for their wastewater treatment and biosolids facilities. They wanted to share risk and they wanted the resources of a private company. But they also wanted to maintain a public workforce and still run the operations.

The answer? They decided to create a new type of partnership model, a model in which employees stay public and are assisted by a highly-specialized team of global wastewater experts.

Designed to protect ratepayers from cost overruns, the new contract features public- and private-sector officials who work as an integrated team to develop plans and execute required work versus a more conventional Design/Bid/Build procurement methodology or a traditional public-private partnership that would include private-sector operations.

Winnipeg's public employees continue to operate all facilities. The city retains full and final decision-making authority and sets all service and quality standards, supported by private-sector experts.
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The Veolia team is providing expertise and best practices on capital upgrades, new and emerging technologies, operations and industry best practices. Winnipeg and Veolia collaborate on capital improvements and work together to provide ongoing strategic advice and guidance on design, construction, technology and operational needs for three Winnipeg wastewater treatment and biosolids facilities. Winnipeg also benefits from Veolia's global purchasing power.

This new model is truly groundbreaking, and it definitely puts Winnipeg on the world map in terms of management innovation. While the contract bears resemblance to some international contract models (it somewhat follows the "project alliancing" model used in Australia, and shares some similarities with Veolia projects in China and Germany), ultimately it's a completely new type of contract arrangement which has never been tried before.

While thinking through the idea, Winnipeg discussed whether or not certain private-sector companies considered it possible for the city to run its operations while sharing risk. Some companies disagreed, but Veolia found the idea interesting and worth exploring.

"We believe this model is a game changer for cities around the world," said Laurent Auguste, president and CEO, Veolia Water Americas. "The unique contract arrangement developed in Winnipeg can make it easier for municipal decision-makers to utilize the industry's best-in-class services. Given the challenges facing water managers today, there are tremendous benefits for involving the private sector."

Says Barry McBride, director of Winnipeg's Water & Wastes Department, "Our advice to other folks is that if the partners are willing to do it and move forward it will work. You just have to get the right partners - the right people - on the job."

For more information on Winnipeg, see the press release or this article in Underground Infrastructure Management.

Interested in learning more about Winnipeg's unique contract model? Call 312-552-2800 or email us. We're happy to answer any detailed questions you may have.


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