ADMINISTRATIVE REPORT
MEETING DATE: June 10, 2026 AGENDA CATEGORY: Consent - Agreements TO: Honorable Mayor and City Council
FROM: Kristina Budak, Water Director
DATE: May 27, 2026
SUBJECT: Amendment No. 2 to Agreement No. 2025-164 with Willdan Energy Solutions (increase compensation by $503,140; revised not to exceed $847,380) to allow for the procurement and safe harbor of a photovoltaic system for the Water Department solar project.
RECOMMENDATION:
Staff recommends approval of the amendment.
BACKGROUND:
On August 27, 2025, the City and Willdan entered into Agreement No. 2025-164 whereby Willdan agreed to, among other things, conduct an investment grade energy audit to identify energy savings, as well as provide support for the installation of a photovoltaic (PV) system and battery energy storage system (BESS) at the Water Resources Building.
Following the execution of Agreement No. 2025-164, changes to federal law triggered the expiration of the Solar Investment Tax Credit (ITC), which necessitated the purchase of certain battery materials prior to December 31, 2025, to fully capture and realize anticipated savings. On Novembe r 19, 2025, Amendment No. 1 allowed Willdan to procure BESS materials and equipment prior to December 31, 2025, thus securing the ITC savings. Amendment No. 1 involved a lump sum payment, not to exceed $344,240.
Similarly, the PV system requires procurement and safe harbor by July 3, 2026, to adequately capture ITC incentives for the PV system . This proposed amendment enables Willdan to procure the necessary materials and equipment for the PV system prior to the July 3 deadline. In doing so, this will allow the City to secure 30-50% base credit incentives which, based on Rough Order of Magnitude cost estimates, can amount up to $1.96M in incentive dollars.
The proposed amendment will add a lump sum payment, not to exceed $503,140, which will allow for the order and procurement of the necessary materials and equipment prior to the safe harbor deadline. This addition brings the not-to-exceed total compensation to $847,380.
FISCAL IMPACT:
There is no impact to the General Fund associated with approval of this amendment. Sufficient funds are budgeted within the Domestic Capital Improvement Fund for this amendment and project.
COUNCIL GOAL:
Innovative and Efficient City Government
ATTACHMENTS:
Amendment No. 2 to Agreement No. 2025-164