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Public Works details progress and risks on $350 million Public Health and Safety bond
Summary
Public Works told the committee the $350 million Public Health and Safety bond has completed two sales, is funding hospital, clinic and fire projects, and faces bidding and financial-reporting challenges; client departments said projects are advancing to construction.
Joe Chin, Public Works program manager for the Public Health and Safety Bond Program, gave the Seagull Bank Committee a comprehensive update on the $350 million bond, saying two sales have closed and work across six bond components is moving from design into construction.
Chin said the bond allocates about $272 million to the Department of Public Health, $58 million to the Fire Department and $20 million to the Department of Homelessness and Supportive Housing. Two bond sales were completed — a first sale in March 2017 and a second in June 2018 — and the program is targeting a third and final sale in early 2020. He described progress on major components including Building 5 at Zuckerberg San Francisco General Hospital, several community health centers, an ambulance deployment facility and neighborhood fire station work.
"We've completed steel erection" on the ambulance deployment facility and are on track to complete that project by winter 2020, Chin said, and he described plans to use a CMGC (construction manager/general contractor) two-step contracting approach to deliver multiple projects efficiently.
Representatives from client agencies told the committee they welcome the progress. Kathy Jung, director of facilities and capital planning for the Department of Public Health, said three community health centers are expected to enter construction early next year. Lindsay Haddis of the Department of Homelessness and Supportive Housing said 440 Turk Street was substantially completed July 31 and staff expect to move into the renovated space later in the summer.
Committee members pressed staff on program risks. Several members pointed to the uncertain bidding environment and the difficulty of reconciling expenditures since the city's PeopleSoft financial system went live, noting a presentation footnote that numbers reflect only bond-sale expenditures and are "subject to revision." Chin acknowledged ongoing reconciliation work and said the Department of Public Works is coordinating with its deputy director of finance to clarify labor and other allocation issues.
The committee also discussed contracting strategy. Chin described CMGC as a two-step selection (RFQ then RFP) allowed under Chapter 6 of the San Francisco Administrative Code and said staff will shortlist contractors and issue a request for proposals in the coming weeks.
The committee did not take formal action on the presentation; members agreed to follow up with additional financial detail at a future meeting and to have the department's finance deputy appear for deeper questions.
