For discussion
on 26 May 1999

ITEM FOR PUBLIC WORKS SUBCOMMITTEE
OF FINANCE COMMITTEE

HEAD 709 - WATERWORKS
Water Supplies - Combined fresh/salt water supply
86WC - Water supply to Pak Shek Kok, Tai Po - remaining works

Members are invited to recommend to Finance Committee -

1. the upgrading of part of 86WC, entitled "Water supply to Pak Shek Kok, Tai Po - Pak Shek Kok fresh water service reservoir, Tai Po Kau fresh water pumping station and associated mainlaying" to Category A at an estimated cost of $100.5 million in money-of-the-day prices; and

2. the retention of the remainder of 86WC in Category B.

PROBLEM

By 2002, the existing water supply system serving Pak Shek Kok and its adjoining areas (Tai Po Areas 12(Part) and 39) will not be able to cope with the anticipated increase in water demand arising from the planned developments¹ in the areas.

PROPOSAL

2. The Director of Water Supplies (DWS), with the support of the Secretary for Works, proposes to upgrade part of 86WC to Category A at an estimated cost of $100.5 million in money-of-the-day (MOD) prices for the provision of additional waterworks facilities to extend fresh and salt water supplies to new developments in Pak Shek Kok and its adjoining areas (Tai Po Areas 12(Part) and 39).

PROJECT SCOPE AND NATURE

3. The full scope of works under 86WC comprises -

1. construction of a fresh water service reservoir with a capacity of 5 500 cubic metres;

2. construction of a fresh water pumping station to cope with a demand of 5 500 cubic metres per day;

3. laying of 6.5 kilometres of fresh water mains of sizes ranging from 200 to 600 millimetres in diameter in Pak Shek Kok; and

4. laying of about 3.8 kilometres of salt water mains of sizes ranging from 150 to 300 millimetres in diameter in Pak Shek Kok.

4. The part of 86WC we now propose to upgrade to Category A comprises -

1. works described in paragraphs 3(a) and 3(b) above;

2. laying of about 2.3 kilometres of fresh water mains of 450 millimetres in diameter mainly between the proposed fresh water service reservoir and the proposed fresh water pumping station under the works in paragraph 3(c) above; and

3. laying of about 0.8 kilometres of salt water mains of 300 millimetres in diameter along Tolo Highway in Shatin under the works in paragraph 3(d) above.

JUSTIFICATIONS

5. The existing fresh water supply system serving Pak Shek Kok and its adjoining areas (Tai Po Areas 12(Part) and 39) has a capacity of about 1 370 cubic metres per day. Given the anticipated rapid development in the area, we envisage that the local population will increase in phases from 1 900 at present to 3 000 in 2002, to 3 700 in 2004 and to 12 300 in 2008. Together with the proposed off-campus sports centre for the Hong Kong Institute of Education, we expect that the daily fresh water demand will increase from the current level of 700 cubic metres to 1 400 cubic metres in 2002, to 1 500 cubic metres in 2004 and to 5 500 cubic metres in 2008. There will be a shortfall in fresh water supply from 2002 onwards. We, therefore, plan to expand the existing fresh water system to the area as detailed in paragraphs 3(a) to 3(c) above in phases to meet the projected growth in fresh water demand beyond 2002.

6. At present, there is no salt water supply in the areas and the residents there rely on fresh water for flushing. Therefore, we plan to extend the salt water supply to the area as detailed in paragraph 3(d) above to cope with the projected daily salt water demand of about 270 cubic metres in 2004 and 1 000 cubic metres in 2008.

7. The Director of Territory Development (DTD) will undertake a roadworks project under the proposed 496CL ² Advance engineering infrastructure works for Pak Shek Kok development' which includes roadworks along Tolo Highway in Shatin. As the salt water mains mentioned in paragraph 4(c) above will fall within the project boundaries of 496CL, to avoid unnecessary repetitive road opening and interface problems arising from two contractors working on the same site, we will incorporate this part of the works into the roadworks contracts under 496CL.

FINANCIAL IMPLICATIONS

8. We estimate the capital cost of the project to be $100.5 million in MOD prices (see paragraph 9 below), made up as follows -

	$ million
(a) Service reservoir	39.1
(b) Pumping station	15.9
(c) Pipe materials	5.1
(d) Mainlaying	23.7
(e) Consultants’ fees	0.1
(f) Resident site staff cost	0.4
(g) Contingencies	8.4 ______
Sub-total	92.7	(at December 1998 prices)
(h) Provision for price adjustment	7.8 ______
Total	100.5	(in MOD prices)

A breakdown by man months of the estimate for consultants' fees and resident site staff cost is at the Enclosure.

9. Subject to approval, we will phase the expenditure as follows -

Year	$ million (Dec 1998)	Price adjustment factor	$ million (MOD)
1999 - 2000	6.3	1.02625	6.5
2000 - 01	38.3	1.06217	40.7
2001 - 02	40.3	1.09934	44.3
2002 - 03	5.8	1.13782	6.6
2003 - 04	2.0	1.1776	52.4
	______		______
	92.7		100.5
	______		______

10. We derived the MOD estimates on the basis of the Government's latest forecast of trend labour and construction prices for the period 1999 to 2004. We will incorporate the proposed salt water mains into DTD's roadworks contract on a lump sum basis. We will tender the works described in paragraphs 4(a) and (b) under remeasurement contracts because the works involve extensive underground works, the quantities of which are subject to variation during construction to suit the actual site conditions. We will provide price adjustment in the contracts because the contract periods will exceed 21 months.

11. We estimate the additional annually recurrent expenditure to be $873,000.

12. This project by itself would lead to an increase in water charges by a maximum of 0.07% in real terms by 2004 ³ .

PUBLIC CONSULTATION

13. We consulted the Sha Tin Provisional District Board and Tai Po Provisional District Board on 30 June 1998 and 7 July 1998 respectively. The two Provisional District Boards supported the proposed works.

14. We consulted the Tai Po Rural Committee (TPRC) on 9 July 1998. The TPRC supportedraised no objections to the proposed works. Subsequently, the village representatives of Yuen Chau Tsai Village at that time raised a strong objection to the construction of the proposed pumping station on the ground that burials in the neighbouring traditional burial ground might be adversely affected. We consulted TPRC again on 9 March 1999. The TPRC supportedupheld its original position of maintaining no objections to the proposed works.

ENVIRONMENTAL IMPLICATIONS

15. The Director of Environmental Protection vetted the Preliminary Environmental Review (PER) conducted by DWS in July 1995. The PER concluded that the project would have no long term environmental impact and no Environmental Impact Assessment is required. We will control noise, dust and site run-off during construction to comply with established standards and guidelines through the implementation of mitigation measures in relevant contracts. We have included in the project estimates the cost to implement suitable mitigation measures to control short term environmental impacts.

LAND ACQUISITION

16. The project requires clearance of government land. The clearance will only affect crops with no households involved. We will charge the land clearance costs estimated at $1.5 million to Head 701 - Land Acquisition.

BACKGROUND INFORMATION

17. We upgraded 86WC to Category B in September 1996.

18. In December 1997, Finance Committee approved the upgrading of part of 86WC to Category A as 87WC "Water Supply to Pak Shek Kok, Tai Po - advance mainlaying along Yau King Lane" at an estimate cost of $24.2 million in MOD prices. The scope of works of 87WC comprises the laying of about 1.6 kilometres of fresh water mains and 0.5 kilometre of salt water mains in Pak Shek Kok and its adjoining areas. We commenced the works in January 1998 for completion in 2001.

19. In November 1998, Finance Committee approved the upgrading of another part of 86WC to Category A as 93WC "Water supply to Pak Shek Kok, Tai Po - advance mainlaying along Tolo Highway" at an estimate cost of $18.2 million in MOD prices. The scope of works of 93WC comprises the laying of about 0.1 kilometre of fresh water main and 2.4 kilometres of salt water mains along Tolo Highway. We commenced the works in March 1999 for completion in late 2001.

20. We have substantially completed the detailed design work for the Pak Shek Kok fresh water service reservoir, Tai Po Kau fresh water pumping station and fresh water mains using in-house resources. We plan to start the proposed works in October 1999 for completion inby end 2001.

21. As regards the salt water mains which we now propose to incorporate into DTD's roadworks contracts under 496CL, we have engaged consultants to complete the detailed design at a cost of $200,000 and charged the cost to block allocation Subhead 9100WX "Waterworks, studies and investigation for items in Category D of the Public Works Programme". We plan to start the proposed mainlaying works in October 1999 for completion in June 2001 to tie in with the roadworks programme under 496CL.

22. We will continue with the detailed design for the remaining works under the project with a target to start construction in September 2001 for completion in March 2004.

--------------------------------------------

Works Bureau
May 1999
(PWSC0137/WIN5)

Enclosure to PWSC(1999-2000)24

86WC - Water Supply to Pak Shek Kok, Tai Po - remaining works

Breakdown of estimates for consultants' fees

Consultants' staff costs		Estimated man months	Average MPS* salary point	Multiplier factor	Estimated fee ($ million)
(a) Contract administration	Professional Technical	0.4 0.2	40 16	2.4 2.4	0.06 0.01
(b) Preparation of as-built drawings	Professional Technical	0.1 0.2	40 16	2.4 2.4	0.02 0.01
(c) Resident site staff cost	Professional Technical	2.0 5.3	40 16	1.7 1.7	0.21 0.19 _______
			Total consultants' staff costs		0.50

* MPS = Master Pay Scale

Notes

(1) A multiplier factor of 2.4 is applied to the average MPS point to arrive at the full staff costs including the consultants' overheads and profit, as the staff will be employed in the consultants' offices (at 1.4.98, MPS pt. 40 = $62,780 p.m. and MPS pt. 16 = $21,010 p.m.). A multiplier factor of 1.7 is applied to the average MPS in the case of site staff supplied by the consultants.

(2) The figures given above are based on estimates prepared by the Director of Water Supplies. The consultancy works for this project will be included as part of the overall consultancy agreement for 496CL. We will know the actual consultants' fees upon finalisation of the account of the works contract.

(PWSC0137/WIN5)

1.The types of planned developments in the concerned area include medium to low density residential buildings, village type developments, an off-campus sports centre for the Hong Kong Institute of Education and expansion of the Chinese University of Hong Kong.

2.A related paper, PWSC(1999-2000)23, for the upgrading of 496CL under Head 707 to Category A is also submitted for Members�endorsement at this meeting. DTD plans to start the roadworks in October 1999 for completion in June 2001.

3.The increase on water charges is calculated on the assumption that the water demand remains static during the period from 1998 to 2004 and the amount of Government subsidy in the waterworks operations is to be contained at the present level.