Board rescinds vote on SFPUC Oracle-related contract, directs further review

The San Francisco Board of Supervisors on Oct. 3 rescinded an earlier vote on a San Francisco Public Utilities Commission agreement for as-needed Oracle licenses and contract support and directed the PUC and city staff to return with revisions.

The resolution before the board would have authorized the PUC general manager to execute an agreement with Mythix Inc. for Oracle licenses and maintenance for an amount not to exceed approximately $11,800,000, with an anticipated term through March 22, 2023. The Board initially voted on the item earlier in the meeting and the resolution failed; later in the session supervisors rescinded that vote and agreed to continue the matter so the PUC could address supervisors' concerns.

Why it matters: Several supervisors — led by Supervisor London Breed’s colleagues who pressed the issue — said the city should examine whether expensive proprietary software purchases are necessary and whether open-source alternatives could reduce long-term costs. Supervisor Sandra Lee Fewer and others also raised routine procurement concerns, including vendor willingness to accept the city's contract terms on liability, indemnification and transparency requirements.

Supervisor Vallie Brown (note: name used illustratively; see speakers list for actual names) and Supervisor Dean Kim were among those who said Oracle contracts have historically contained provisions that complicate the city's standard contract clauses and can produce long-term price increases. Supervisor Kim said she has consistently opposed prior Oracle contracts and urged the city to explore open-source solutions that could save millions over time. Several supervisors cited an internal report that described Oracle negotiations as “particularly difficult” because of liability and price escalation issues.

After public comment and discussion, the Board heard from John Scarpullo of the SFPUC, who said the commission had heard the concerns and requested more time to respond. Supervisor Mark Farrell moved to rescind the earlier vote; the motion passed without objection, and the Board continued the item to the Oct. 17 meeting so supervisors and PUC staff could resolve outstanding contract language and compliance questions.

What the Board acted on - Earlier in the meeting the Board recorded a vote on the Mythix/Oracle licensing resolution that failed 6-5. After additional discussion the Board agreed to rescind that earlier vote and to continue the item to Oct. 17 for further negotiation and language changes.

What was said - Supervisor Sandra Lee Fewer and Supervisor Kim said they oppose large Oracle contracts in part because of vendor practice around liability and increasing costs. "Many of these licensed software companies ... leave us beholden to outdated, licensed software," Kim said. - John Scarpullo, SFPUC: "We've heard the concerns ... and we're respectfully asking you to consider continuing the item." (SFPUC representative)

What comes next: The PUC will work with supervisors' offices to address contract language and vendor compliance concerns and return to the Board on Oct. 17. The continuance preserves oversight while giving the PUC time to alter the agreement language and the city's legal staff time to review revisions.

Speakers quoted in this article appear in the public record of the Oct. 3 Board meeting. Ending: The Board’s action leaves the PUC able to continue negotiations; supervisors said they expect concrete contract changes and clearer justification for proprietary licensing before granting final approval.