Today, when the city of San Francisco wants to build something big—like a new metro line or transit-only lanes—it’s required by law to rank the cheapest contractors higher on the list.
That could change if city Supervisor Rafael Mandelman has his way.
“That’s just not a good way of selecting contractors,” Mandelman said. “It's something that sounds good and sounds like a way of saving money but actually isn’t.”
New legislation, spearheaded by Mandelman, takes aim at a city policy that requires cost be at least 40% of the criteria for selecting a contractor for major city projects like Van Ness Bus Rapid Transit and the Central Subway—both of which wound up mired in cost overruns and delays. It also would require the city to log and take into account past performance of city contractors when evaluating them for future projects.
The idea, Mandelman said, came out of two Civil Grand Jury reports: One about a defunct contractor database, and the other about the Van Ness project, which went $35 million over budget and was delayed three years. Part of the problem was that the city didn’t know the extent of infrastructure that was underneath its own streets. The other problem, the report found, was that the low bidder for Van Ness wasn’t the most qualified, leading to problems with the project and unforeseen cost run-ups.
The Civil Grand Jury’s recommendation, which forms the basis of Mandelman’s proposal, is to change city policy and leave it up to department heads to decide just how much cost should matter.
“It’s really important to look at other, non-cost criteria in figuring out whether the contract is actually going to perform in a way that is good for the public,” Mandelman said. “We’re plainly seeing a lot of cases where the amount that’s paid for the project to the contractor bears no resemblance to the initial bid anyway.”
Rachel Gordon, spokesperson for the city’s Public Works Department, said her office is supportive of the intent of the legislation.
“Building high-quality capital projects to serve the needs of the people of San Francisco always has been the goal of San Francisco Public Works,” Gordon wrote. “Our capital team had been in discussions with the supervisor as he was developing this proposal and we look forward to working with him as the plan goes through the legislative process.”
Mandelman said a system to track contractor performance already exists, but it hasn’t been used or maintained by the city.
“It's pretty upsetting to me that poor performance would never be factored into a future procurement,” Mandelman said.
A spokesperson from the transit agency, which spearheaded the Van Ness project, said it will wait to respond until the bill makes its way through the legislative process.
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