CC 02-04-2025 Item No. 10 Award a design-build contract for the Photovoltaic Systems Design and Installation_Written CommunicationsCC 02-04-2025
Item No. 10
Award a design-build
contract for the
Photovoltaic Systems
Design and Installation
Project
Written Communications
From:Ravi Kiran Singh Sapaharam
To:Chad Mosley; City Council; Pamela Wu; City Clerk
Subject:February 4, 2025 Council Meeting || Review of Photovoltaic Project
Date:Tuesday, February 4, 2025 3:46:30 PM
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Dear City Clerk,
Please include the following in the written communications for the February 4, 2025, council
meeting:
Dear Mayor Chao and Council Members,
I urge you to reconsider the photovoltaic project due to:
Escalating Costs: The budget has increased from $6.3 million to at least $10 million,
including $4.3 million for Syserco Energy Solutions and $225,000 for 4Leaf, Inc. in
project management fees.
Uncertain Federal Funding: The project depends on a 30% rebate from the IRA and
a 10% BABAA bonus, both currently on hold requiring federal approval. Without
these, costs could rise significantly.
Financial Risks: Projected savings rely on meeting the NEM 2.0 deadline. Delays
might force the city onto less beneficial NEM 3.0 rates, reducing ROI. With these
uncertainties, the $1.67 million could better serve immediate infrastructure needs.
For fiscal responsibility, I respectfully request the cancellation of this project to avoid
unnecessary financial risk.
Sincerely,
Ravi
Cupertino Resident
From:Santosh Rao
To:City Council; City Clerk; Chad Mosley; Susan Michael; Pamela Wu; Tina Kapoor
Subject:Urgent: Reject agenda item 10 Photovoltaic Project Due to Uncertain Federal Funding and Escalating Costs
Date:Tuesday, February 4, 2025 3:37:11 PM
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Dear City Clerk,
Please include the below in written communications for the 02/04/25 council meeting.
Subject: Urgent: Reject the Photovoltaic Project Due to Uncertain Federal Funding and
Escalating Costs
Dear Mayor Chao and Cupertino City Council Members,
I am an incoming planning commissioner but am writing and speaking on behalf of myself
only as a Cupertino resident.
I urge you to reject agenda item 10 involving the photovoltaic (PV) project in its
entirety due to its escalating costs, uncertain federal funding, and significant financial risks to
Cupertino taxpayers.
Escalating Costs and Poor Fiscal Planning
This project was originally budgeted at $6.3 million but is now projected to cost at least $10
million when factoring in the design-build contract, construction management fees, and
contingencies. The contract with Syserco Energy Solutions alone is $4.3 million, with an
additional $225,000 allocated to 4Leaf, Inc. for project management. Given the history of
cost overruns in public works projects, the final amount could rise even higher, putting further
strain on city funds.
Unreliable Federal Funding Jeopardizes Financial Viability
A key assumption behind this project is that the city will receive a 30% rebate through the
Inflation Reduction Act (IRA) Direct Pay credit, with an additional 10% from the "Build
America Buy America Act" (BABAA) domestic content bonus credit. However, these
federal incentives are not guaranteed. The latest update from the Biden-to-Trump transition
indicates that all IRA disbursements are now on hold, requiring specific federal approval
for each project. This creates a major funding risk, as Cupertino could be left without these
anticipated rebates, dramatically increasing the city's financial burden.
Uncertain Long-Term Savings and High Opportunity Costs
The projected savings of $276,000 annually and $13 million over 30 years depend on
multiple assumptions, including meeting the tight April 2026 deadline to qualify for Net
Energy Metering (NEM) 2.0 rates. If the project is delayed—whether due to supply chain
issues, labor shortages, or unforeseen construction challenges—the city would be forced
onto less favorable NEM 3.0 rates, reducing the financial return. The remaining $1.67
million in city funds currently allocated to this project could instead be redirected to higher-
priority infrastructure needs that guarantee more immediate and tangible benefits for
Cupertino residents.
A Responsible Path Forward: Cancel the Project Entirely
Rather than moving forward with a high-risk, high-cost project, the most fiscally responsible
decision is to cancel it outright. The project’s financial model has been undermined by
shifting federal policies, and relying on uncertain funding sources places Cupertino in a
precarious position. Without firm guarantees on IRA rebates, the city should not proceed with
this large-scale capital investment.
I strongly urge you to halt and reject this project before Cupertino is left footing an
unnecessary multi-million-dollar bill.
Sincerely,
San Rao (Cupertino resident)