SFPUC upholds award for Southeast plant repair despite LBE protest

The San Francisco Public Utilities Commission voted June 26 to award contract WW522 — Southeast Water Pollution Control Plant dewatering facility corrosion repairs — to Monterey Mechanical despite formal protests from local contractors who said the project’s engineer’s estimate was increased after the pre-bid period, eliminating a 10% Local Business Enterprise (LBE) bid preference.

Don Cabianca, representing Cal State Constructors, told the commission he opposed the staff recommendation and asked that WW522 "not be awarded to Monterey Mechanical," saying the advertised engineer’s estimate shifted after addenda and that "the existence of the 10% bid preference for LBE firms was made very clear by city staff during the pre bid conference." Alan Coe, also representing Cal State Constructors, echoed that the contract size had been increased in ways that disadvantaged local firms and urged a rebid or splitting the work to preserve LBE access.

Staff defended the procurement. Harlan Kelly, Assistant General Manager for Infrastructure, said the department had ordered an independent third-party estimate and "Parsons looked into it and they, they felt that it was a $13,000,000 estimate," which staff used to validate the engineer’s estimate above the $10,000,000 threshold. City Attorney staff told commissioners the office "stands behind the staff recommendation" and that there was a legitimate basis for the scope changes.

Project manager Jignesh Desai emphasized site constraints and safety urgency in explaining why staff considered a single, integrated contract necessary. He displayed photographs and warned of operational risks, saying in part, "If there's a breakage to occur, there'll be flooding of the entire building with the sludge damaging all of our infrastructure, electrical, mechanical, otherwise." Assistant General Manager Tommy Mawala added that some equipment had already failed in the past and staff was concerned about further delay.

Jim Troop, president of Monterey Mechanical, said his firm had bid the job "fair and square," noting the company’s long experience in water and wastewater projects and saying Monterey Mechanical was the lowest responsible, qualified bidder.

Commissioners discussed options including rebidding, breaking the job into smaller pieces, or taking no action. After public comment and legal counsel’s advice, a motion to proceed with the award was moved and seconded; the commission voted to approve the award. The item had been separated from the consent calendar for discussion and ultimately received a majority vote to move forward.

The decision leaves unresolved the objections raised by Cal State Constructors, which asked the commission to reject the bids and rebid the project to preserve LBE preference eligibility. Staff said rebidding would add approximately 4–6 months to procurement time and risk ongoing operational problems at the facility. The commission did not adopt a rebid; staff will proceed with contract award and project execution.

Next steps: staff will return to the commission with contract award paperwork and proceed with project mobilization, subject to the standard administrative and contracting processes.