CITY OF SAN MATEO
City Council Special Meeting
February 18, 2025
5:30 PM
City Hall Council Chamber
Entrance is on O’Farrell Street
COUNCIL MEMBERS
Robert Newsom Jr.
Adam Loraine
Nicole Fernandez
Danielle Cwirko-Godycki
Lisa Diaz Nash
AGENDA
THIS MEETING CAN BE ATTENDED IN PERSON OR REMOTE BY JOINING ZOOM – SEE CODES BELOW.
PUBLIC COMMENTS WILL BE ACCEPTED BOTH IN PERSON AND REMOTEL Y.
SEE END OF AGENDA FOR OPTIONS AND INSTRUCTIONS ON HOW TO PARTICIPATE IN THE MEETING.
To join via Zoom – click here:
February 18, 2025
To join via telephone: (408) 638-0968
Webinar ID: 815 5953 3162 Passcode: 501588
CALL TO ORDER
Roll Call
AB 2449 Requests and Considerations for Meeting Participation by Teleconference due to Just Cause or Emergency Circumstances
CLOSED SESSION
The public will have an opportunity to comment before the consideration of these items. Following the meeting a report of action from Closed Session will be provided if required.
1. Conference with Legal Counsel – Anticipated Litigation Significant exposure to litigation pursuant to paragraph (2) of subdivision (d) of Section 54956.9 One case (Claim of Myers & Sons Construction, LLC)
2. Conference with Legal Counsel – Anticipated Litigation Initiation of litigation pursuant to paragraph (4) of subdivision (d) of Section 54956.9:
Six cases
STUDY SESSION
The public will have an opportunity to comment during the consideration of this item.
3. Clean Water Program and Wastewater Treatment Plant Upgrade & Expansion – Update Receive an informational update on the Clean Water Program and the Wastewater Treatment Plant Upgrade & Expansion project.
CEQA: The City prepared a Final Programmatic Environmental Impact Report (Final PEIR) in accordance with the California Environmental Quality Act (CEQA) (SCH No. 2015032006). Council on June 6, 2016, certified the PEIR. In accordance with CEQA, the Final PEIR serves as the primary environmental compliance document for the implementation of the Clean Water Program. The City prepared Addenda to the Final PEIR that was approved on
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July 16, 2018 (Addendum 1) and April 15, 2019 (Addendum 2). This work is within the scope of the Project evaluated in the PEIR and Addendum.
ADJOURNMENT
----------------------------------------------------------------------------------------------------------------------------- AGENDAS:
Agendas and material are posted on the City’s website on the Friday preceding each Council Meeting and can be viewed on the City's website at
www.cityofsanmateo.org
. Any supplemental material distributed to the Council after the posting of the agenda will be made part of the official record.
WATCHING A MEETING ON TV:
City Council meetings are broadcast live on Comcast/channel 27, Wave/channel 26, or AT&T/channel 99.
For transmission problems during the broadcast, please call (650) 522-7099. For all other broadcast comments, call (650) 522-7040, Monday-Friday, 8 a.m. - 5 p.m.
WATCHING A MEETING ON A COMPUTER:
There are three ways to stream.
1) Public Meeting Portal
www.cityofsanmateo.org/publicmeetings
2) City YouTube channel and stream it on YouTube:
http://youtube.com/CityofSanMateo
3) Watch TV live stream:
https://www.cityofsanmateo.org/193/Channel-San-Mateo-Live-Stream
PUBLIC COMMENTS/REQUEST TO SPEAK
Prior to the Meeting
Send comments to:
[email protected]
until 4 p.m. the day of the meeting.
During the meeting
By Zoom:
Click the link at the top of the agenda and you’ll be added to the meeting. All attendees are muted by default. When the item of interest is open for consideration, select the “Raise Your Hand” icon and you will be called on at the appropriate time.
By telephone:
Call (408) 638-0968 and enter the conference ID found at the top of the meeting agenda. When the item of interest is open for consideration, select *9 to raise your hand. When called upon, press *6 to unmute, state your name and provide your comments.
In Person:
At the meeting complete a “Request to Speak” form, submit a request at the speaker kiosk or scan the QR code.
ACCESSIBILITY:
In compliance with the Americans with Disabilities Act, those with disabilities requiring special accommodations to participate in this meeting may contact the City Clerk’s Office at (650) 522-7040 or [email protected]
. Notification 48 hours prior to the meeting will
enable the City to make reasonable arrangements to ensure accessibility to this meeting.
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CITY OF SAN MATEO
CITY OF SAN MATEO
Agenda Report
City Hall
330 W. 20th Avenue
San Mateo CA 94403
www.cityofsanmateo.org
Agenda Number: 3 Section Name: STUDY SESSION Account Number: File ID: 25-9617 TO: City Council
FROM: Alex Khojikian, City Manager
PREPARED BY: Public Works Department
MEETING DATE: February 18, 2025
SUBJECT:
Clean Water Program and Wastewater Treatment Plant Upgrade & Expansion – Update RECOMMENDATION:
Receive an informational update on the Clean Water Program and the Wastewater Treatment Plant Upgrade & Expansion project.
BACKGROUND:
The City is currently under a Regional Water Quality Control Board Cease and Desist Order requiring improvements to its sewer collection system and Wastewater Treatment Plant (WWTP) to eliminate sanitary sewer overflows and unauthorized discharges of untreated or partially treated wastewater to San Francisco Bay. The Clean Water Program (CWP) is a $1 billion program that started in 2015 to comply with the Cease and Desist Order. The CWP includes numerous capital improvement projects that have either been completed, are currently under construction, or are soon starting construction. The projects include improvements to sewers, manholes, and pump stations, the new Underground Flow Equalization System (located at the San Mateo County Event Center), and improvements at the WWTP. The WWTP Upgrade and Expansion Project (WWTP Project) is the largest of these CWP projects, which will result in new liquid treatment facilities for processing wastewater required to meet regulations.
Since the CWP projects were chartered, the CWP’s project budgets, including the WWTP Project, took into account the costs associated with administrative services, program/project controls, project management, preliminary evaluations, engineering services, procurement, construction contracts, construction management, permits, outreach, risk contingencies, and escalation. A strategic funding and financing plan to deliver the CWP was executed and included raising sewer rates over several years, issuing bonds, and pursuing loans. The CWP successfully received three low-interest rate loans from State and/or Federal programs. These loans were able to reduce the fiscal impact of the City’s investment in the sewer infrastructure on the San Mateo rate payers. In June 2023, Council approved annual 3 percent inflationary sewer rate increases for five years, starting in Fiscal Year 2023-24; without the low-interest rate loans, sewer rate increases would have been higher.
Currently, the Clean Water Program is scheduled to be officially complete at the end of December 2026. In 2017, the CWP’s project budgets were baselined and the CWP’s estimate at completion was $991 million. In February 2024, Council received an updated $999 million CWP estimate at completion, based on the best available information at the time. Due to risks, changes, delays, and unknowns identified over the past year, the CWP’s current estimate at completion has increased to approximately $1.028 billion. This increased estimate does not require an adjustment to the currently approved 5-year sewer rate increase schedule.
In February 2024, staff also provided Council with details of the WWTP Project, which included construction progress updates, causes for delays and budget increases, and updated schedules. At that time, the WWTP Project budget and
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CITY OF SAN MATEO
estimate at completion was $572 million. Due to risks, changes, delays, and unknowns identified over the past year, the WWTP Project’s current estimate at completion has increased by approximately $25 million and is now $597 million, which is still subject to change. Construction has been challenging while still progressing forward. Since February 2024, the Project has required several significant changes, including changes related to the fuel storage system, the fire suppression systems in the Administration Building, the chemical piping system, the aeration piping system, piping in the Biological Nutrient Removal Basin due to dissimilar metals; and timing issues related to the completion of leak testing of the basins and remote monitoring system programing. In order to minimize the impact to the construction schedule of the Project, the Contractor has worked overtime and on Saturdays to complete additional work from these approved change orders.
As a result of the realized and potential change orders, as well as schedule challenges, construction expenditures are going to exceed the previously anticipated estimate at completion for the Project.
To ensure there is sufficient funding to complete the WWTP Project, staff will be proposing a $24.8 million budget in the coming Fiscal Year 2025-26 Capital Improvement Program to fund the completion of the project; this increase will align the budget committed to the project account with the WWTP Project’s estimate at completion of $597 million. This $24.8 million increase includes costs associated with the construction contract ($19.5 million) and extended soft costs ($5.3 million). The $19.5 million budget request associated with the construction contract is inclusive of known changes and risks, delay costs, potential future risks and changes, and contingencies. The $5.3 million budget increases associated with the extended soft costs include project management, construction management, specialty inspections, owner-controlled insurance program, and engineering services during construction. The $24.8 million budget increase is based on information known today and is subject to change as the project progresses closer to completion.
Based on the project cash flow estimates for the remainder of the current Fiscal Year 2024-25, there is sufficient budget and existing authorized construction contract contingency to keep the project progressing. Staff anticipates returning to Council after the Fiscal Year 2025-26 budget is adopted with a request to increase the construction contract contingency; the planned $24.8 million budget request is inclusive of the anticipated construction contract contingency amount; however, waiting to make this request in the new fiscal year will allow the construction management team to further review all the potential construction contract changes with the intent to mitigate as much of the risk as possible and hopefully reduce the overall request.
BUDGET IMPACT:
The budget information included in the update will be incorporated into the City's overall future Fiscal Year 2025-30 Capital Improvement Program, which will be presented to Council for approval later this fiscal year. There are sufficient funds in the Sewer Fund Reserves for the future budget requests associated with the Clean Water Program projects.
ENVIRONMENTAL DETERMINATION:
The City prepared a Final Programmatic Environmental Impact Report (Final PEIR) in accordance with the California Environmental Quality Act (CEQA) (SCH No. 2015032006). Council on June 6, 2016, certified the PEIR. In accordance with CEQA, the Final PEIR serves as the primary environmental compliance document for the implementation of the Clean Water Program. The City prepared Addenda to the Final PEIR that was approved on July 16, 2018 (Addendum 1) and April 15, 2019 (Addendum 2). This work is within the scope of the Project evaluated in the PEIR and Addendum.
NOTICE PROVIDED
All meeting noticing requirements were met.
ATTACHMENTS
None
STAFF CONTACT
Deryk Daquigan, Deputy Public Works Director
[email protected]
(650) 522-7287
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Update to
San Mateo City Council
By Public Works
February 18, 2025
1 Clean Water Program and Wastewater
Treatment Plant Upgrade & Expansion
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• Clean Water Program Overview and Update
• Wastewater Treatment Plant Upgrade & Expansion Update 2 Agenda
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Clean Water Program - Driver & Goals
Replace aging
infrastructure and
facilities
Build wet weather
sewer system capacity
assurance to prevent
overflows
Meet current and
future regulatory
requirements
Align with the City of
San Mateo and Foster
City’s sustainability goals
Driver: Regional Water Quality Control Board issued 2009 Cease & Desist Order to the City of San Mateo, Town of Hillsborough, and the Crystal Springs County Sanitation District requiring the elimination of sanitary sewer overflows (SSOs)
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Post
CWP
Clean Water Program Schedule Highlights
4 Recurring WWTP and Collection System Rehabilitations and Repairs WWTP & Collection System Capacity Improvements
Start WWTP
Upgrade & Expansion
Construction
2019
WWTP Upgrade & Expansion
Project Closeout
2026
Start UFES
Construction
2020
UFES Project
Closeout
2025
Program
Closeout
2026
2019 2020 2021 2022 2023 2024 2025 2026 2027
WWTP Upgrade & Expansion
New Facilities in Service
2025
Clean Water
Program
Initiated
2015
Budget
Baselined
2017
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Clean Water
Program
5 • ~$1 billion, 10-year effort
• Wet Weather Management
• Collection System
Rehabilitation and Capacity
Improvements
• WWTP Upgrades
• Nutrient Removal
Note: Image shown displays the estimated
scope during April 2018.
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Status of CWP
Capacity
Improvements
COLOR LEGEND
Projects Completed
Projects in Construction
Projects in Design
Notes:
Some project segments were eliminated
due to design optimizations.
Status of projects shown as of February
2025.
Rev. 03/03/2022
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Expansion -
Treatment
Process Facility
Existing WWTP
SF Bay
Objectives
• Replace the existing liquids treatment process
with a new facility:
• Headworks, primary sedimentation, secondary
treatment (biological nutrient removal), tertiary
(membrane bioreactors), equalization basins
• Achieve early actor status on nutrient removal
• Increase wet weather management to 78
million gallons per day
• Title 22 effluent ready / Future recycled water
WWTP Upgrade & Expansion
Largest Capital Improvement Project in the History of the City
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9 WWTP U&E, May 2020
Excavation and
Shoring
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10 WWTP Upgrade & Expansion, Nov 2021
Piles; Foundation; and
Wall Rebar/Framework
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11 WWTP U&E, March 2023
Process Facilities
Backup Generators
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12 WWTP Upgrade & Expansion, March 2024
Headworks
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13 WWTP Upgrade & Expansion, June 2024
Primary Clarifiers
Odor Control
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14 WWTP Upgrade & Expansion, August 2024
BioActiflo
Primary
Clarifiers
Odor Control Pipes
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15 WWTP Upgrade & Expansion, May 2024
Biological Nutrient Removal
(BNR) Basin
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WWTP Upgrade & Expansion, February 2025
Membrane Bioreactor (MBR)
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17 WWTP Upgrade & Expansion, February 2025
Double Contained Chemical (Teflon) Piping
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18 WWTP Upgrade & Expansion, September 2024
Admin Building – Exterior Site Work
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19 WWTP Upgrade & Expansion, September 2024
Admin Building – Conference Room
Admin Building – Laboratory
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20 WWTP Upgrade & Expansion, November 2024
North and East Side of Admin Building
Concrete Works
Render of Pathway
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WWTP Upgrade & Expansion
Reviewing and Negotiating Known & Potential Changes/Risks Construction Costs/Risks (~$19.5M):
• Flow equalization (FEQ) conversion and
valve pit differing site conditions
• HVAC material and labor escalation
• Stormwater pollution prevention (SWPP)
• Stormwater storage tank level controls
• Air aeration header deformation & piping
• Chemical dual containment piping
• Lighting at chlorine contact basins
• Fuel system changes
• Admin building fire suppression systems
• SCADA monitoring system programming
• Leak testing
• Tower Crane
• Traffic Control
• Asphalt
• Time impacts
• Additional risk contingency
Soft Costs due to Extended Schedule (~$5.3M):
• Project management
• Construction management
• Specialty inspections
• Insurance
• Engineering services during construction
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Upcoming WWTP Construction Key Milestones
Dates Subject to Change
Existing Plant Chemical Area Improvements Mar 2025
All New Processes Areas Completed April 2025 Clean Water Testing Jan to July 2025 Plant Seeding June 2025 Plant Performance Testing July to Aug 2025 New Processes Operational Aug 2025 Potential Ribbon Cutting Ceremony Sep 2025 Conversion of Existing Aeration Basins July 2025 to Feb 2026 Finish All Site Work Mar 2026 Project Close Out Mar to Apr 2026
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WWTP Contractor Provided Info: Unprecedented COVID, Supply Chain, Inflation Impacts April 2020
Sub-Bids
Submitted
Oct 2020
GMP-3 (~$380M)
Council Award;
begin
subcontracting
Jan 2021
Sub-Contracts in Place,
Start Construction
$30M
Value
Engineering
GMP-3 Procurement & Construction
% Change since Start Date
50 100
150
2021 2022 2023 2024
0 Producer Price Index (PPI) of Construction Commodities Over Time with Tariffs Cost Impacts:
• Equipment & materials escalation
• COVID protocols, CA Law
• Unplanned labor escalation
Schedule Impacts:
• Equipment/material lead times
• Labor issues
Copper & Brass Mill
Shapes
Conduit & Fittings
Fabricated Structural Steel
Steel Pipe & Tube
Metal Pipe FittingsCopper Wire & Cable
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CWP 2017 BASELINE vs ESTIMATE AT COMPLETION (EAC)
UPDATEClean Water Program Projects Original 2017
Budget Current EAC Variance %
Variance
Program Management Clean Water Program $ 85,092,559 $ 70,613,310 $ (14,479,249) (17.0%) Basin 2 & 3 Collection System Improvements $ 150,269,411 $ 165,692,230 $ 15,422,819 10.3% East SM Sewer Lift Station Improvements $ 23,635,177 $ 26,087,948 $ 2,452,771 10.4% Annual Sewer Rehabilitations $ 53,105,656 $ 57,019,492 $ 3,913,836 7.4% Sewer CCTV Inspection $ 4,904,937 $ 5,909,096 $ 1,004,159 20.5% Other Collection System Projects $ 26,885,605 $ 25,895,970 $ (989,635) (3.7%) WWTP Immediate Action Proj (IAP) Package 1 $ 21,678,855 $ 18,621,628 $ (3,057,227) (14.1%) WWTP IAP Package 2 $ 13,021,372 $ 18,744,338 $ 5,722,966 44.0% WWTP IAP Package 3 $ 2,469,442 $ 17,797,112 $ 15,327,670 620.7% WWTP Annual Major Components $ 8,919,114 $ 21,845,582 $ 12,926,468 144.9% WWTP Upgrade & Expansion $ 532,708,966 $ 597,465,161 $ 64,756,195 12.2% Other WWTP Projects $ 2,119,969 $ 2,858,296 $ 738,327 34.8% Program Contingency $ 66,299,227 $ - $ (66,299,227) (100.0%) TOTALS $ 991,110,290 $1,028,541,163 $ 37,430,873 3.8%
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Project Name Current Committed
Budget
25-26
Proposed
26-27
Planned
Total Project
Budget
Program Management Clean Water Program $ 71,488,000 $ (874,000) $ - $ 70,614,000 Collection System SCADA $ 2,660,065 $ (618,000) $ - $ 2,042,065 East SM Lift Station Improvements $ 24,525,421 $ 1,563,000 $ - $ 26,088,421 Basin 4 Collection System Improvements $ 6,956,000 $ (4,068,000) $ - $ 2,888,000 Sewer Flow Monitoring & Hydraulic Modeling $ 662,000 $ (172,000) $ - $ 490,000 Annual Sewer Rehabilitations $ 62,351,000 $ (5,331,000) $ - $ 57,020,000 Sewer CCTV Inspections $ 5,501,000 $ 409,000 $ - $ 5,910,000 WWTP Upgrade & Expansion $ 572,500,000 $24,957,000 $ - $ 597,457,000 WWTP IAP Package 2 $ 13,793,695 $ 4,951,000 $ - $ 18,744,695 WWTP Annual Major Components $ 10,994,000 $ 5,487,000 $ 5,365,000 $ 21,846,000 TOTAL $26,303,661 $ 5,365,000
Note: Only project accounts associated with the Clean Water Program that have anticipated budget requests are shown.
UPCOMING BUDGET REQUESTS FOR CWP PROJECTS
Subject to Revisions
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WWTP Upgrade & Expansion
Estimated Construction Contract Cost at Completion
Values based on available cost data as of February 2, 2025 Package/Phase Award Date
Awarded
Contract
Amount
Council
Authorized
Contingency
Potential
Contingency
Needed in
Future
Potential
Cumulative
Contingency
Potential
Construction
Contract Amount
1 - Site Preparation May 2019 $ 33,098,178 $ 1,725,000 $ 0 $ 1,725,000 2 - Foundation May 2020 $ 17,716,049 $ 1,645,000 $ 0 $ 1,645,000 3 - Process Facilities Sept 2021 $ 379,880,747 $ 37,550,000 $ 19,507,000 $ 57,057,000 TOTALS $ 430,694,974 $ 40,920,000 $ 19,507,000* $ 60,427,000 $ 491,122,000
9.5% 14.0%**
* The Potential Contingency amount is included in the ~$25 million FY 25-26 budget request for the WWTP Upgrade & Expansion project.
** For CIP Construction Contracts, a contingency amount equal to 10% of the construction contract is typically authorized.
For contracts with higher risks, contingencies of 20% have been authorized.
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History of Economic and Financial Strategy
FY 16/17: 12% Sewer Rate Increase (100% Usage Based Rate Structure) Agreement with Estero Municipal Improvement District/Foster City FY 17/18: 36% Rate Increase (100% Usage Based Rate Structure) FY 18/19 to 22/23: 5-Year Rate Increases (12% to 14%) & Restructured with 50% Fixed Rate $270M Wastewater Revenue Bonds (SM/FC)
$277M WWTP EPA WIFIA Loan (SM/FC)
$85M Collection System WIFIA Loan (SM Only)
$145M WWTP State Revolving Fund Loan (SM/FC)
Agreement with Hillsborough for Payment of Capital Costs FY 23/24 to 27/28: 5-year inflationary rate increases (3% per year) Agreement with County and CSCSD for Payment of Capital Costs
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Deryk Daquigan, PE
Deputy Director, Public Works Department
[email protected]
29 Thank you
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