DATE:
October 14, 2025
CATEGORY:
Consent
DEPT.:
Public Works
TITLE: Addendum No. 13 to Regional Water
Quality Control Plant Basic Agreement
RECOMMENDATION
1. Authorize the City Manager or designee to execute Addendum No. 13 to the Basic Agreement between the cities of Palo Alto, Mountain View, and Los Altos for the Joint Intercepting Sewer Rehabilitation Phase 1 Project at the Palo Alto Regional Water Quality Control Plant to increase the cost-share not-to-exceed amount to $5,600,000 from the City of Mountain View.
2. Appropriate $ 890,000 to the Public Works Department Wastewater Fund for the Joint Intercepting Sewer Rehabilitation Phase I Project. (Five votes required)
BACKGROUND
In 1968, the cities of Mountain View and Los Altos agreed to retire their wastewater treatment plants and approved a contract with the City of Palo Alto (Basic Agreement, also referred to as the Partners Agreement) for the acquisition, construction, and ma intenance of a joint wastewater treatment plant at the site of Palo Alto’s existing plant that was constructed in 1934.
The new plant began operating in 1972. In addition to providing wastewater treatment services for the cities of Palo Alto, Mountain View , and Los Altos, the Palo Alto Regional Water Quality Control Plant (Treatment Plant) provides services to the Town of Los Altos Hills, Stanford University, and the East Palo Alto Sanitary District under separate agreements with the City of Palo Alto.
Per the Basic Agreement, Palo Alto owns and operates the Treatment Plant’s wastewater treatment and disposal facilities and is responsible for managing capital improvements to the plant. The Basic Agreement is amended as needed to implement and fund major capital projects for the replacement of obsolete or end-of-life equipment. 1 1 Historically, the amendments to the Basic Agreement have been referred to as “addenda ,” although the accurate term is amendment. The parties to the Basic Agreement have continued the practice of using the term “addendum” for consistency.
Addendum No. 13 to Regional Water Quality Control Plant Basic Agreement October 14, 2025
The Treatment Plant owns and maintains a trunk sewer known as the Joint Intercepting Sewer (JIS), which conveys raw sewage from Mountain View, Los Altos, Los Altos Hills, and a portion of Palo Alto. The JIS was constructed in 1972 and consists of multiple sections of 60” and 72” diameter reinforced concrete pipes. The original pipe is unlined with no external coating. The length of the JIS is approximately 9,000’.
The pipeline’s alignment starts at a metering station located at 1151 San Antonio Road, on the border of Palo Alto and Mountain View. The alignment runs north-west and below-grade through the Baylands Nature Preserve and along the western edge of the City of Palo Alto’s closed landfill.
The pipeline ends at a junction box inside the Treatment Plant.
Figure 1: Joint Intercepting Sewer Pipeline
This Joint Intercepting Sewer Rehabilitation Phase 1 Project (Project) will rehabilitate the deteriorated 2,364’ section of pipeline and manholes as shown in the figure above labeled as Phase 1. The work also includes repair and recoating the interior of existing manholes and the influent junction box. Pipe rehabilitation will use a cured-in-place pipe method, in which a resin- impregnated liner is inserted, expanded, cured, and adhered onto the existing pipe’s interior surfaces. The cured liner will become a new pipe inside the existing host pipe, providing structural strengthening as well as smoother and corrosion-resistant surfaces that will not reduce the trunk sewer’s service capacity.
On December 5, 2023, the City Council approved Addendum No. 12 to the Regional Water Quality Control Plant Basic Agreement for the construction of the Project for a cost-share not-to-exceed amount of $5,159,619 from the City.
On December 11, 2023, Palo Alto awarded a construction contract to SAK Construction, LLC , for $8,082,470 that included a 10% construction contingency. Construction began in winter 2024 , and the lining of the primary pipe has been completed.
Addendum No. 13 to Regional Water Quality Control Plant Basic Agreement October 14, 2025
ANALYSIS
During construction, the Project encountered delays due to unforeseen site conditions, including difficult access and obstructions not visible during design, and contractor schedule and sequencing challenges. Other construction challenges included:
• Discovery of landfill waste during excavation and the need to fill and cap the landfill;
• Additional manhole modifications and repairs; and
• Complications with the sewage bypass system due to higher -than-anticipated flow variability.
Numerous change orders were issued for these unforeseen conditions. These delays also pushed construction into 2025.
More recently, the contractor discovered failure in a junction box where the interceptor conveys wastewater to enter the treatment plant. The rehabilitation of the junction box and the complex sewage bypass system for the work must be done while the construction is underway and necessitates increasing funding available to the contractor for the change order work. To address all the change order work along with maintaining a sufficient contingency for the project completion, Palo Alto staff recommends increasing the construction contract by $2,800,000.
The additional construction work has resulted in additional affiliated design and construction management costs totaling nearly $793,000. The total project costs have increased $3,593,000 from $8,935,000 to $12,528,000.
FISCAL IMPACT
The cost -share allocation is based on each partner agency’s share of the sewer interceptor’s maximum allocated flow capacity. Maximum flow capacity is reached during high -flow events during wet weather. Mountain View’s cost share is 62.5%, as shown in Table 1 below.
Table 1: Maximum Flow Capacity Allocation and Cost Share
Item Mountain
View Palo Alto Los Altos Los Altos
Hills Total
Maximum Allocated
Flow Capacity
(mgd)
50.00 14.59 12.00 3.41 80.00
Allocated Share (percent) 62.50% 18.24% 15.00% 4.26% 100.00%
Addendum No. 13 to Regional Water Quality Control Plant Basic Agreement October 14, 2025
Approximately $4.8 million (updated from $1.9 million presented in Addendum No. 12) of the project expenses involve work on the Treatment Plant site, which is the responsibility of all partner agencies. As such, the East Palo Alto Sanitary District and Stanford University will also share in project expenses for the in- plant bypass pumping systems, along with Mountain View, Palo Alto, Los Altos, and Los Altos Hills. The cost share for this work element will be based on each agency’s share of the ongoing pay -as-you-go capital budget, which is approximately as follows: Palo Alto 37%; Mountain View 39%; Los Altos 10%; Los Altos Hills 2%; and the remaining 12% from the other agencies.
Based on the cost shares described above, the updated detailed cost breakdown for the JIS Project is listed in Table 2 below. Mountain View’s total cost share has increased by approximately $1,566,000 from the $5,159,619 presented in Addendum No. 12.
Table 2: Construction Expense by Partner Agency
Partner Agency Cost Share
Mountain View $6,726,000
Palo Alto 3,141,000
Los Altos 1,658,000
Los Altos Hills 425,000
East Palo Alto 268,000
Stanford University 310,000
Total Construction Expense
(includes 10% contingency) $12,528,000
The City of Mountain View has paid approximately $4.7 million over the past two years since the project began, based on the original cost proposal provided by Palo Alto that was addressed in Addendum No. 12 . However, due to the recent discovery of unplanned repair costs, Mountain View’s share of the project has increased to $6.7 million, as listed in Table 2.
Of this amount, the City of Palo Alto has proposed that approximately $1.1 million could be covered under the Minor Capital Improvement (CIP) category because of the work in the junction box which impacts all agencies . This category, established under the Master Agreement for the Treatment Plant, was designed to give Palo Alto flexibility to address emergency or small -scale repair work without requiring contract amendments with all partner agencies. Mountain View’s Wastewater Fund includes an annual budget allocation for Minor CIP expenses, which may be used to cover a portion of the increased cost. The remaining amount requiring City Council approval is approximately $890,000.
The Wastewater Fund has sufficient fund balance to cover the $890,000 budget need for the project.
Addendum No. 13 to Regional Water Quality Control Plant Basic Agreement October 14, 2025
LEVINE ACT
California Government Code Section 84308 (also known as the Levine Act) prohibits city officials from participating in any proceeding involving a “license, permit, or other entitlement for use” if the official has received a campaign contribution exceeding $500 from a party, participant, or agent of a party or participant within the last 12 months. The Levine Act is intended to prevent financial influence on decisions that affect specific, identifiable persons or participants. For more information see the Fair Political Practices Commission website: www.fppc.ca.gov/learn/pay-to- play-limits-and-prohibitions.html
Please see below for information about whether the recommended action for this agenda item is subject to or exempt from the Levine Act.
EXEMPT FROM THE LEVINE ACT
☒ Contract between two or more state or local government agencies
ALTERNATIVES
1. Use another funding source for the cost increase to the project.
2. Provide other direction.
PUBLIC NOTICING—Agenda posting.
Prepared by:
Lisa Au
Assistant Public Works Director
Approved by:
Jennifer Ng
Public Works Director
Audrey Seymour Ramberg
Assistant City Manager
PWK/LL/LA-10-14-25CR