CITY COUNCIL STAFF REPORT
DATE: January 14, 2026 CONSENT CALENDAR
SUBJECT: APPROVAL OF AMENDMENT NO. 5 TO PROFESSIONAL SERVICES AGREEMENT NO. A9141 WITH MWH CONSTRUCTORS, INC. (MWH) IN THE AMOUNT OF $18,340 AND EXTEND AGREEMENT THROUGH
MARCH 31, 2026, FOR THE WASTEWATER TREATMENT PLANT
(WWTP) DIGESTER NO. 2 GAS FLARE AND FILTRATE PUMP STATION, CITY PROJECTS 20-25 & 21-07 (THE PROJECT).
FROM: Scott C. Stiles, City Manager
BY: Engineering Services
SUMMARY:
Amendment No. 5 to Professional Services Agreement (PSA) No. A9141 with MWH Constructors, Inc. (MWH) increases the not-to-exceed budget by $18,340 and extends the agreement through March 2026, ensuring continuous Construction Management (CM) and inspection support for Project. The contract extension is required due to unavoidable delays caused by Gas Holder coordination, SCADA integration requirements, and pending system startup activities, guaranteeing uninterrupted oversight during the project's final commissioning phase.
RECOMMENDATION:
1. Approve amendment No.5 in the amount of $18,340 to Professional Services Agreement No. PSA A9141 with MWH for a new not-to-exceed amount of $2,071,412.14 and extend the agreement to March 31 2026 for the for the wastewater treatment plant (WWTP) digester no. 2 gas flare and filtrate pump station, city projects 20-25 & 21-07.
2. Authorize the City Manager to execute all necessary documents.
BUSINESS PRINCIPAL DISCLOSURE:
MWH Constructors Inc. is a California corporation. A copy of their Public Integrity Disclosure Form is included as Attachment A.
City Council Staff Report
January 14, 2026 -- Page 2
MWH AMMENDMENT FOR CIP 20-25 & 21-07
5 7
4 BACKGROUND:
On May 12, 2022, the City Council awarded a construction contract to Rados (“Contractor”) in the amount of $15,905,500 for the WWTP Digester No. 2 Waste Gas Flare and Filtrate Pump Station Projects. The initial scope of work included replacing Digester No. 2, construction of a new gas holder, replacement of the existing waste gas flare and replacement of the Filtrate Pump Station and Filtrate Pump Station main as shown in Figure 1 below.
The gas holder stores biogas, a byproduct of anaerobic digesters. The disposal of this gas is done via a flare that safely burns excess or unusable gases, controlling odors, reducing potent greenhouse gas emissions, such as methane, to meet environmental regulations. This holder is built of a membrane material and has shown structural problems. These problems are currently being investigated by the contractor, their subcontractors and the manufacturer. Consequently, the project will not be accepted until this issue is resolved. Construction Management and Inspection support services are crucial to the City during this process.
On December 5, 2025 the Construction Manager (CM) submitted an amendment request stating that as the project progresses toward final completion, funding and schedule for the agreement require immediate attention. The current agreement funds for construction management and inspection support are anticipated to be fully exhausted by the end of October 2025. The Contractor's latest schedule indicates that contract completion is not expected until January 26, 2026, but outstanding issues with the gas holder may extend the schedule past the January date. This leaves a significant gap of approximately three months or more where critical construction management and inspection services will be unfunded. A copy of the amendment request detailing purpose and scope is included as Attachment B
Figure 1 – Site Vicinity Map
City Council Staff Report
January 14, 2026 -- Page 3
MWH AMMENDMENT FOR CIP 20-25 & 21-07
5 7
4 STAFF ANALYSIS:
Maintaining an independent, continuous inspection presence is a critical component of the project. The contractor’s integration, startup procedures and certifications must be documented and approved before acceptance of the project by the City. In addition, the Construction Manager’s assistance is required to evaluate and guide the process that will allow the city to make decisions regarding the issues with the gas holder. Approval of this amendment ensures that expert oversight, documentation and consultation will be available through the satisfactory completion of the project.
ENVIRONMENTAL ASSESSMENTS:
Section 21084 of the California Public Resources Code mandates guidelines for implementing the California Environmental Quality Act (CEQA).
In accordance with the California Environmental Quality Act (“CEQA”) Guidelines Section 15302 “Replacement or Reconstruction”, Class 2 projects consist of replacement or reconstruction of existing structures and facilities where the new structure will be located on the same site as the replacement structure and will have substantially the same purpose and capacity as the structure replaced. Therefore, Staff have determined that the City of Palm Springs Wastewater Treatment Plant Digester No. 2, Waste Gas Flare and Filtrate Pump Station Improvement Project, City Projects No. 20-25 and 21-07, are considered categorically exempt from CEQA.
ALIGNMENT WITH STRATEGIC PLANNING:
This item aligns with the City Council Broad Goal of Infrastructure and Facilities.
FISCAL IMPACT:
The Engineering Department's original budget for this agreement was $1,246,123.14.
Due to necessary permitting and construction requirements, the agreement has undergone four prior amendments totaling $806,494. Amendment No. 5 will increase the total contract price by $18,340, resulting in a new total price of $2,071,412.14. Sufficient funds are available within the Wastewater Fund to cover this increase REVIEWED BY:
City Engineer Joel Montalvo
Deputy City Manager: Flinn Fagg
City Manager: Scott Stiles
City Council Staff Report
January 14, 2026 -- Page 4
MWH AMMENDMENT FOR CIP 20-25 & 21-07
5 7
4 ATTACHMENTS:
A – MWH Public Integrity Disclosure Form
B – MWH Amendment request.