Board approves Laguna Honda contract amendments; supervisor questions cost overruns and funding source clarified

San Francisco — The Board of Supervisors voted to authorize two amendments related to the Laguna Honda Hospital replacement program, increasing previously authorized amounts for construction management services and design agreements.

Supervisor Alioto Pier paused the item to request representation from Laguna Honda but ultimately voted no, citing concern about 20% cost overruns and a desire for clarity on whether funds designated for community living for people with severe disabilities were being used. In discussion, another supervisor and staff explained the project had been scaled back from the original voter-approved plan and that the current funding model includes debt backed by the general fund.

When the source of funds was questioned, the board was told by Harvey Rose (recorded as "Mister Rose") that the specific source for the amendments under discussion is tobacco settlement revenues. Rose said, “Mister chairman ... the source of funds here are tobacco settlement revenues.”

The board adopted the two resolutions authorizing the director of Public Works to execute the amendments (one increasing a construction management services agreement and another increasing a design agreement) by roll call, 10 ayes and 1 no. The no vote was recorded from the supervisor who earlier said they would vote no due to unanswered questions about cost overruns.

The items represent incremental adjustments to larger Laguna Honda replacement program contracts and were described by staff as components of the voter‑approved program (which in turn had been reduced in scope because of financing constraints). The board asked to return to the item later in the meeting so Laguna Honda representatives could be present to address outstanding fiscal and programmatic questions.