Budget and Finance Committee forwards grants, contracts and $40 million housing bond package to full Board

The Budget and Finance Committee of the San Francisco Board of Supervisors on Jan. 22 forwarded a series of grants, contract amendments and a $40 million general obligation bond authorization to the full Board with positive recommendations, most by unanimous 3-0 votes.

The measures included: a $410,000 retroactive grant for the City Attorney's worker protection team from the California Department of Industrial Relations; a $9.5 million amendment to AECOM Technical Services' contract for construction management on the Hetch Hetchy Mountain Tunnel rehabilitation; roughly $496,000 from the James Irvine Foundation awarded to the Office of Economic and Workforce Development for worker-owner cooperative capacity building; a $750,000 Metropolitan Transportation Commission grant for Visitation Avenue bicycle and pedestrian improvements; a $750,000 Department of Health Care Services grant to the Department of Public Health to support MATCH (Modular Approach to Therapy for Children); new citywide contracts for mailroom services with Pitney Bowes (not-to-exceed $23.55 million) and integrated pest management with Pestech (not-to-exceed $15.5 million); a $23,400 donation to the Police Department Mounted Unit from the Margaret Living Trust; authorization to seek $1.5 million in Pro-Housing Incentive Program funding for a senior housing project at 976 Mission; and an amendment to a MOHCD loan for a 100%-affordable family housing project at 2530 18th Street.

Why it matters: the actions advance several major infrastructure and housing efforts and keep state and philanthropic funding flowing to local programs. The mountain tunnel work supports a century-old Hetch Hetchy conveyance that serves about 2.8 million residents and businesses across four counties. The bond authorization would fund preservation, rehabilitation and seismic safety upgrades to existing affordable housing and is paired with loans that projects will repay to offset debt service.

Mountain tunnel contract amendment: The committee heard the San Francisco Public Utilities Commission project manager explain that Amendment No. 3 to the construction management agreement with AECOM Technical Services increases the not-to-exceed amount by $9.5 million to $34 million and extends the contract by five months to December 30, 2027. Randy Anderson described the project scope: shaft construction, new access adit, lining repairs across roughly 11 miles of the 19-mile tunnel, multiple planned outages to allow crews inside the tunnel, environmental mitigation and roadway access work. Anderson said the concrete lining repairs “are about three times greater than originally anticipated in the contract,” and that much of the additional construction management cost is tied to inspection hours and overtime during outages. The Budget and Legislative Analyst recommended approval, noting the proposed increase is driven largely by an $8.1 million rise in construction inspection services and nearly $1 million to rebid a portion of work.

Housing preservation bond authorization and program use: MOHCD staff described the ordinance and companion resolution authorizing up to $40 million in general obligation bonds for the Preservation and Seismic Safety Program (Series 2025E). William Wilcox and Vishal Droedi (Office of Public Finance) explained the bonds fund acquisitions and rehabilitations of existing affordable housing — not new construction — and are structured as permanent mortgages that projects must repay. MOHCD named two prospective uses: Larkin Pine Senior Housing rehabilitation and acquisition of 2901 16th Street by Mission Economic Development Agency. The committee and the Budget and Legislative Analyst agreed to an amendment correcting a drafting error (the funds are to be held pending sale of general obligation bonds, not certificates of participation). The committee moved the ordinance and resolution forward with a positive recommendation.

MOHCD loan amendment for 2530 18th Street: MOHCD described a request to increase acquisition/takeout funding for a development led by Mercy Housing California and Homeless Prenatal Program (HPP). The amendment adds $2 million, bringing the MOHCD loan exposure for acquisition/takeout to $6.9 million and total city funding to about $11.8 million. MOHCD said the project was redesigned to increase unit count (from ~74 to ~96) and remove planned HPP ground-floor expansion, a change the sponsors say improves feasibility for state financing in the current market. The proposed loan remains 0% interest, repayable on city acquisition to ground lease or five years from the original closing (October 2028).

City Attorney wage-theft grant: Katie Porter, managing attorney in the City Attorney’s Office, and Matt Goldberg, chief worker protection attorney, explained a retroactive accept-and-expend resolution for a $410,000 grant from the California Department of Industrial Relations Labor Commissioner’s Office to fund local enforcement of state labor laws from Aug. 1, 2024 through July 31, 2025. Goldberg described the grant as a “first-time effort” from the state and said the maximum grant per recipient under the program is $750,000; the state allocated $18 million for the program. Supervisors Chan and Dorsey asked to be co-sponsors; the committee forwarded the resolution.

Grants and program funding: The committee approved retroactive and new accept-and-expend requests across departments: OEWD’s ~$496,684 James Irvine Foundation award to scale worker-owner cooperative supports and contractual awards to community partners; Recreation and Park’s $750,000 MTC grant for Visitation Avenue bicycle/pedestrian safety improvements (design underway, construction targeted for summer 2026); and DPH’s $750,000 grant for MATCH therapy training and services for youth (DPH proposed, and the committee approved, non-substantive amendments to correct program text and participant age ranges and to reflect accurate service counts).

Citywide contracts and procurement: The Office of Contract Administration presented a new citywide mailroom equipment, supplies and postage umbrella agreement with Pitney Bowes (initial 3-year term with two-year extension option) with a not-to-exceed amount of $23,550,000. OCA staff said roughly 99% of historical Pitney Bowes spending reflects USPS postage purchases by ReproMail. The committee also forwarded a five-year integrated pest management (IPM) contract with Pestech (doing business as Pestech) not to exceed $15.5 million; the RFP evaluation panel recommended Pestech following a competitive solicitation.

Other items and donations: The Police Department requested and the committee approved acceptance of a $23,400 donation from the Margaret Living Trust to the Mounted Unit to supplement horse care. The committee also authorized MOHCD to submit a $1.5 million application to the State’s Pro-Housing Incentive Program to support a 95-unit senior housing project at 976 Mission.

Votes at a glance: The committee recorded positive recommendations on all items moved to the full Board. Where roll-call votes were recorded, the committee vote was 3-0 (Vice Chair Rafael Mandelmann, Supervisor Matt Dorsey and Chair Connie Chan voting Aye). Specific items moved forward included: Item 1 (City Attorney grant, $410,000) — motion by Chair Connie Chan; Item 2 (SFPUC AECOM amendment, +$9.5M) — motion and forward; Item 3 (OEWD Irvine grant, ~$496,684) — forward; Item 4 (Rec & Park MTC grant, $750,000) — forward; Item 5 (DPH MATCH grant, $750,000) — forwarded as amended; Item 6 (Pitney Bowes umbrella contract, $23.55M) — forward; Item 7 (Pestech IPM contract, $15.5M) — forward; Item 8 (SFPD Mounted Unit donation ~$23,400) — forward; Items 9 & 10 (MOHCD $40M GO bond ordinance and bond sale resolution) — forwarded as amended; Item 11 (MOHCD Pro-Housing grant application $1.5M) — forward; Item 12 (MOHCD loan amendment for 2530 18th, +$2M) — forward.

Committee context and next steps: Committee members repeatedly thanked department staff for work performed in challenging circumstances (complex tunnel work, procurement constraints and housing finance uncertainty). Most items now move to the full Board of Supervisors; staff indicated the bond pricing schedule targets late February with a March closing if the Board approves the authorization.

Quote highlights: Matt Goldberg, City Attorney’s Office, on the wage-theft grant: “This grant is sort of unique and a first-time effort where the state legislature has actually allocated money to combat wage theft to local public prosecutors.” Randy Anderson, SFPUC project manager, on tunnel repairs: the lining repairs “are about three times greater than originally anticipated in the contract.”

Ending note: No public commenters spoke on any of the items. The committee adjourned after completing its agenda and forwarded all items listed above to the full Board with positive recommendations.