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We are currently using Project Server 2013 and would like for our project managers to have control over user permissions in their project sites. The project managers group is automatically given the "Project Managers (Microsoft Project Web App)" permission level.

Project-site Permissions

Checking at the Site Collection level, I can see that it is missing the "Manage Site" and "Create Subsites" permissions.

Permission Level Permissions

If i add enable the "Manage Site" permissions, they eventually get reset to the default Project Server settings at some point during the day; probably through a timer job. I can't find where in the PWA settings I can modify the default permission level settings. Is it possible to modify these and if so, how?

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Looking at the screenshot it seems that you are using Project Server Permission mode. In the Project Server Permission mode, all your SharePoint Permission will be reset every day via timer job based on the setting in Project Server Security options. You can create Group in Project Server Permission --> Manage Group or modify existing group and provide require access to users.

Visit below link to get more details about each permission in Project Server 2013. https://technet.microsoft.com/en-us/library/jj219510.aspx

https://technet.microsoft.com/en-us/library/cc197631.aspx

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