Attachment D
October 20, 2025
Via Email
Juan Segoviano, PE
Senior Civil Engineer
City of Palm Springs
3200 E. Tahquitz Canyon Way
Palm Springs, CA 92262
Email: [email protected]
Re: Proposal for Administrative Contract Memorandum (ACM) #6
Dear Mr. Segoviano:
This letter serves to formally present to you and the City of Palm Springs with a proposed amendment for the Operation and Maintenance (O&M) of the recently constructed John Zink Biogas Flare system, Westec Biogas Holder, Crowley Ferrous Injection system and the new Digester, designated as Administrative Contract Memorandum (ACM) #6. Based on Veolia’s costs, finalized by our structuring team and validated through consultations with project staff and other local Veolia operated sites with similar equipment, we propose an annual fee of $218,692 for the operations and maintenance of the newly-constructed systems. We also propose an annual Ferrous Chloride budget of $250k for Veolia to purchase the Ferrous Chloride required for the new systems at Veolia’s cost plus 15%, similar to what we do with the biosolids hauling and fleet maintenance in our current O&M agreement.
Should you require further clarification or information, please do not hesitate to contact me at the facility.
Sincerely,
Doug Loar
Project Leader
Veolia Water West Operating Services, Inc. / Palm Springs
Enclosures: ACM #6 Digester, Flare, Gas Holder, Ferrous Injection Cc: Joel Montalvo M.P.A., PE, City Engineer ([email protected]) Francisco Jaime, PE, Principal Engineer ([email protected]) Allen Janisch, Project Manager ([email protected])
Salaries and benefits $105,103 1 FTE Grade III operator.
Dues and subscriptions $640
Licensing, training, exam fee and cert
renewal.
Business insurance $3,328
Allocation based on revenue, performance
bond and liability coverage.
Communications $1,200 Mobile/cellular.
Outside Services $29,842 Environmental services and testing.
Lab and Safety supplies $13,003 Lab supply and services, H&S supplies.
Maintenance & repairs $8,000
Based on our experience at Rialto, using
CMMS data.
Taxes $668
Total Other Expenses $8,000 CMMS integration, incidental sub uses.
Total Cost of Sales $169,784
Overhead 12% $20,374 Management and administrative costs.
Total Cost of Sales with OH $190,158
Margin 15% $28,524
Total Fee Annually $218,682
Total Fee Monthly $18,223
Exhibit A
ADMINISTRATIVE CONTRACT MEMORANDUM NO. 6
This Administrative Contract Memorandum No. 6 is made as of October 20, 2025, by Veolia Water West Operating Services, Inc., a Delaware corporation, (“Veolia”), and the City of Palm Springs, a California charter city and municipal corporation, (“City”). Veolia and City are collectively herein referred to as the “Parties.” This Administrative Contract Memorandum No. 6 is made in reference to the following recitals.
WITNESSETH:
WHEREAS, Veolia and City entered into that certain Wastewater Services Agreement (O&M) dated as of November 4, 2015, commencing January 1, 2016, (the “Agreement”); and WHEREAS, Section 14.5 “Integration; Amendment,” of the Agreement authorizes that where specifically authorized in the Agreement, this Administrative Contract Memorandum may be used as an amendment administratively approved by the Parties through approval by the Contract Officer and an authorized representative of Veolia without further formal action by the City Council; and
WHEREAS, the Parties have negotiated in good faith to amend the terms and conditions of the Agreement pursuant to this Administrative Contract Memorandum No. 6, as authorized by Section 14.5 of the Agreement.
NOW, THEREFORE, the Parties hereby agree to amend the Agreement as follows:
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1. DEFINITIONS. For the purposes of this Administrative Contract Memorandum, the following words and terms shall have the respective meanings set forth as follows. Any other capitalized word or term used but not defined herein is used as defined in the Agreement.
SECTION 1.2. INTERPRETATION. In this Administrative Contract Memorandum, unless the context otherwise requires:
(A) References Hereto. The terms “hereto”, “hereby”, “hereof”, “herein”, “hereunder” and any similar terms refer to this Administrative Contract Memorandum, and the term “hereafter” means after, and the term “heretofore” means before, the date of execution and delivery of this Administrative Contract Memorandum.
(B) Plurality. Words importing the singular number mean and include the plural number and vice versa.
(C) Persons. Words importing persons include firms, companies, associations, general partnerships, limited partnerships, trusts, business trusts, corporations and other legal entities, including public bodies, as well as individuals.
(D) Headings. The table of contents and any headings preceding the text of the Articles, Sections and subsections of this Administrative Contract Memorandum shall be solely for convenience of reference and shall not constitute a part of this Administrative Contract Memorandum, nor shall they affect its meaning, construction or effect. (E) Entire Agreement. This Administrative Contract Memorandum constitutes the entire agreement between the Parties hereto with respect to the amendment(s) to the Agreement contemplated by this Administrative Contract Memorandum. Except as provided in the Agreement with respect to the City Indemnified Parties, nothing in this Administrative Contract Memorandum is intended to confer on any person other than the Veolia, the City and their permitted successors and assigns hereunder any rights or remedies under or by reason of this Administrative Contract Memorandum.
(F) Counterparts. This Administrative Contract Memorandum may be executed in any number of original counterparts. All such counterparts shall constitute but one and the same Administrative Contract Memorandum.
(G) Applicable Law. This Administrative Contract Memorandum shall be governed by and construed in accordance with the applicable laws of the State of California. (H) Severability. If any clause, provision, subsection, Section or Article of this Administrative Contract Memorandum shall be ruled invalid by any court of competent jurisdiction, the invalidity of any such clause, provision, subsection, Section or Article shall not affect any of the remaining provisions hereof, and this Administrative Contract Memorandum shall be construed and enforced as if such invalid portion did not exist provided that such construction and enforcement shall not increase the Parties' liability beyond that expressly set forth herein.
(I) Approvals. All approvals, consents and acceptances required to be given or made by any party hereto shall be at the sole discretion of the party whose approval, consent or acceptance is required.
(J) Payments. All payments required to be made by the Parties hereunder shall be made in lawful money of the United States of America.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF THE PARTIES
SECTION 2.1. REPRESENTATIONS AND WARRANTIES. The Parties hereby represent and warrant that:
(1) Existence and Powers. Veolia is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware, with the full legal right, power and authority to enter into and perform its obligations under this Administrative Contract Memorandum.
City is a charter city and municipal corporation, organized and existing in the County of Riverside, under and by virtue of the laws of the State of California, with the full legal right, power and authority to enter into and perform its obligations under this Administrative Contract Memorandum.
(2) Due Authorization and Binding Obligation. This Administrative Contract Memorandum has been duly authorized, executed and delivered by all necessary corporate action of Veolia and authorization by the City, and constitutes the legal, valid and binding obligation of the Parties, enforceable against the Parties in accordance with its terms, except to the extent that its enforceability may be limited by bankruptcy, insolvency or other similar laws affecting creditors' rights from time to time in effect and equitable principles of general application.
(3) No Approvals Required. In accordance with Section 14.5 of the Agreement, no approval, authorization, order or consent of, or declaration, registration or filing with, any Governmental Body is required for the valid execution and delivery of this Administrative Contract Memorandum by the Parties.
(4) No Legal Prohibition. The Parties have no knowledge of any Applicable Law in effect on the date as of which this representation is being made which would prohibit implementation of the amendment(s) to the Agreement contemplated by this Administrative Contract Memorandum.
(7) Consent to Amendment. The Parties are fully aware of the terms and conditions of the Agreement to be amended by this Administrative Contract Memorandum. (8) Consideration. This Administrative Contract Memorandum is made in the furtherance of the implementation of the Agreement, and the assumption by the Parties of their obligations hereunder will result in a material benefit to the Parties.
ARTICLE III
ADMINISTRATIVE AMENDMENT
SECTION 3.1. AMENDMENT. This Administrative Contract Memorandum (“ACM”) hereby implements the following amendment to the terms and conditions enumerated herein.
The City has undertaken a Capital Project to add a John Zink flare, a Westec Biogas Holder, a Crowley Ferrous Injection system, and a new Digester (the “Additional Assets”) to the Treatment Facility. The addition of the Additional Assets gives rise to a Capital Program Adjustment pursuant to Sections 5.3(h) and 7.4(a) of the Agreement. As of the date of this Amendment, the Additional Assets will be added to the Managed Assets and will be operated and maintained similarly to the rest of the Managed Assets forth in Schedule F of the Agreement.
The Additional Assets are subject to new compliance regulations set forth in the City’s existing updated South Coast Air Quality Management District (“AQMD”) permit #G44648 for the Waste Water Treatment Plant and the new Flare Permit #G74890.
The new Flare Permit requires initial source testing within 180 days of initial startup. Veolia will facilitate this testing as part of this proposed ACM. If initial source testing fails to meet specified standards, the City’s Construction Contractor shall, at the Construction Contractor’s sole cost and expense, implement all necessary corrective measures and successfully complete repeat source testing to the City’s satisfaction. Veolia will have no liability whatsoever in connection with a failed source test.
The operational scope for the Additional Assets will encompass the following:
● Compliance monitoring
● Data collection and management
● Daily regulatory testing
● Daily, weekly & monthly preventative maintenance
● SCADA monitoring and alarm management
The additional fee for the operation and maintenance of the Additional Assets is $218, 692 annually. This additional fee will be added to the current annual O&M Fee of $4,567,814 for a total annual O&M Fee of $4,786,506.
The City selected the addition of Ferrous Chloride (“FC”) as the method to meet AQMD requirements for the new flare associated with the Additional Assets. The City and Veolia agreed that the addition of the FC chemical would be a pass through expense to the City at Veolia’s cost for the FC plus 15%, with a budget established for Veolia, similar to Biosolids, Street Sweeping, and Rolling Stock Maintenance in the Agreement. The initial proposed budget of $250,00 for FC is set forth below. The daily quantities are an estimate and may vary depending on how the
process reacts to the addition of the FCs, and the City will reimburse Veolia for all FC costs, plus markup if actual usage exceeds estimated amounts.
Ferrous Chloride Budget – Cost +15%
Estimate on Quantity Dosed Annually:
Material
Quantity per
Day in lbs.
Cost per
Pound
Pounds
per Day Subtotal
15%
Markup Total
Ferrous
Chloride 2110 $0.28 $590.80 $215,642.00 $32,346.30 $247,988.30
Annual Ferrous Chloride Budget, to be adjusted as necessary - $250,000
SECTION 3.2. NOTICE. All notices required or desired to be given hereunder to either party shall be effective if given by personal delivery, certified or registered mail, postage prepaid, return receipt requested, by nationally recognized overnight delivery company, or by telecopy (if telecopy number is listed below, with telephone confirmation of receipt), if addressed or the following addresses or telecopy numbers:
If to Veolia:
President
Veolia Water West Operating Services, Inc.
15455 N. Greenway Hayden Loop C-15
Scottsdale, AZ 85260
With copies to:
General Counsel
Veolia North America
100 Federal Street, 3rd Floor
Boston, MA 02110
Email: [email protected]
If to City:
City of Palm Springs
3200 Tahquitz Canyon Way
Palm Springs, California 92262
Attention: City Manager
Phone: (760) 322-8350 Fax: (760) 323-8207
With copies to:
City of Palm Springs
3200 Tahquitz Canyon Way
Palm Springs, California 92262
Attention: City Attorney
Phone: (760) 323-8202 Fax: (760) 323-8207
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IN WITNESS WHEREOF, the Parties have executed and entered into this Administrative Contract Memorandum as of the date first written above.
CITY OF PALM SPRINGS
By:
Name:
Title:
ATTEST:
By:
Name:
Title: City Clerk
APPROVED AS TO FORM:
By:
Name:
Title: City Attorney
VEOLIA WATER WEST OPERATING SERVICES, INC.
By:
Name:
Title: