DATE: March 11, 2026
TO: Honorable Mayor and City Councilmembers
FROM: Water Utilities Department
TITLE: AMENDMENT 3 TO PROFESSIONAL SERVICES AGREEMENT WITH ARDURRA GROUP, INC. FOR AS-NEEDED PROJECT MANAGEMENT SERVICES
RECOMMENDATION
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Staff recommend that the City Council approve Amendment 3 to the Professional Services Agreement with Ardurra Group, Inc. in the amount of $1,369,680, for a total contract amount of $3,198,000 to continue providing project management services for various Capital Improvement Projects; and authorize City Manager, or designee, to execute the amendment.
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BACKGROUND AND ANALYSIS
The Water Utilities Department’s Capital Improvement Program (CIP) includes approximately $80 million in anticipated projects in Fiscal Year 2025-26. To deliver this program, the city uses a combination of City staff and contracted project management professionals. One of the firms contracted to perform project management work for the Water Utilities Department is Ardurra Group, Inc. (Ardurra). Contracted project management support allows the city to efficiently scale resources to match fluctuating construction schedules while maintaining schedule control and technical oversight.
On December 18, 2019, following a competitive Request for Proposals process, the City Council awarded a Professional Services Agreement (PSA) to Infrastructure Engineering Corporation (IEC) for Project Management Services in the amount of $873,600.
On November 2, 2022, Council approved Amendment 1 to the agreement in the amount of $954,720. The amendment increased funding to continue project management services for on-going projects and extended the contract term.
On December 11, 2025, Amendment 2 was processed administratively to add time to the contract and combine two separate project manager contracts into one agreement. No additional funds were added under Amendment 2.
This Amendment 3 would add $1,369,680 and extend the term through June 30, 2028, to allow the incumbent project managers to complete important projects currently underway and bring continuity and knowledge of the City’s infrastructure to new and existing projects.
Ardurra currently provides project management services for several complex and high-profile capital improvement projects, including complex and high-profile efforts such as the Sewer Progressive Design-Build Project, Downtown Recycled Water Pipeline Condition Assessment, La Salina Wastewater Treatment Plant Press Building and Structural Improvements, and the Mission Basin Groundwater Purification Facility Wells Expansion and Brine Minimization Project.
The assigned project managers have been involved in these projects through key phases and have developed project-specific knowledge. Continuing with the same project managers will support consistency and minimize disruption as these critical projects move forward. Additionally, these projects involve multi-year construction, regulatory coordination, cost control, and risk management.
One of the assigned project managers is overseeing two major projects with an estimated combined construction value of approximately $160 million over the next four years. The proposed amendment amount represents under one percent of that managed construction value over the same timeframe.
Approval of Amendment 3 will allow uninterrupted management of critical infrastructure projects while the City evaluates future contracting strategies.
FISCAL IMPACT
The total not-to-exceed amount of Amendment 3 is $1,369,680 for services, through June 30, 2028. The project management costs are charged against the capital projects that they are assigned to manage and may vary as some projects end and new projects begin.
Given the scale and complexity of the projects being managed, the cost of these service represents a relatively small proportion of overall capital project expenditures and supports technical and effective oversight, cost control, schedule management, and risk mitigation.
Table 1 below outlines how the FY 2025-26 portion of the contract will be funded. Fiscal Years 2026-27 and 2027-28 will be funded as part of the Department’s CIP budget.
Table 1
Funding for water projects will be provided through Water Sales and Water Meter Charges in the Water Fixed Asset Replacement Fund (712). Funding for Recycled Water and Expansion Projects will be funded primarily by Developer Fees in the Water Expansion Fund (715). Funding for sewer projects will be provided through Sewer Service and Sewer Flow Fees in the Sewer Fixed Asset Replacement Fund (722).
COMMISSION OR COMMITTEE REPORT
The Utilities Commission will be apprised of this amendment at its regularly scheduled meeting on March 17, 2026.
CITY ATTORNEY’S ANALYSIS
The referenced documents have been reviewed by the City Attorney and approved as to form.
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Prepared by: John McKelvey, Principal Management Analyst
Reviewed by: Frederick Mayo, Water Utilities Director
Submitted by: Jonathan Borrego, City Manager
ATTACHMENTS:
1. Staff Report
2. Amendment 3