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Committee accepts BLA changes and forwards SFMTA's Hitachi train-control contract with amended delegated authority
Summary
The Budget and Finance Committee voted to accept Budget and Legislative Analyst recommendations to limit delegated amendment authority and to forward SFMTA’s proposed Hitachi train-control contract (roughly $212M purchase, $114M initial support, $237M future support options) to the full Board with a positive recommendation. The committee removed broad per-modification approval language and set a contingency cap of about 5%.
SFMTA officials presented a supplier contract with Hitachi Rail for a citywide communications-based train-control upgrade and long-term support, describing the technology, procurement process and a multi-phase deployment timeline.
Project managers said the contract includes three primary cost components: approximately $212 million for system purchase and design; about $114 million for the first 10 years of support; and approximately $237 million for subsequent support options (two five-year options), yielding a multi-decade contract structure with a total-not-to-exceed figure in the mid‑hundreds of millions over a 29-year period.
SFMTA emphasized that the procurement included negotiated elements to lower costs and reduce street construction impacts, that Hitachi offered transponder-based technology to limit street work, and that the contract includes performance-based support payments so the supplier’s compensation is tied to system performance.
The BLA raised a concern that the resolution language would have allowed MTA to amend the contract repeatedly without returning to the Board (delegated authority for up to $2 million per modification). The analyst recommended striking that broad delegated authority and instead approving a single not-to-exceed contract amount and a more limited delegated authority—5% of the contract (~$28.2 million)—as contingency.
Committee members and SFMTA staff agreed that a limited contingency was reasonable to avoid repeated small modifications without a substantive explanation. The committee adopted the BLA amendment, removed the broad $2 million-per-modification language, and voted to forward the amended resolution to the full Board with a positive recommendation.
What’s next: The amended resolution will be transmitted to the Board of Supervisors for final action. The SFMTA indicated design work would begin the following January, with installation phases through the early 2030s and testing beginning in 2028 for the initial segment.
