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Budget committee questions emergency finding as it limits DPW contract at Laguna Honda
Summary
Supervisors pressed Public Works about a delayed emergency declaration and cost overruns tied to a leak and mold abatement at Laguna Honda Hospital; the budget analyst recommended limiting emergency authorization to costs already incurred and competitively bidding remaining work, a recommendation the department accepted.
The committee scrutinized an emergency contract increase for Laguna Honda Hospital after Department of Public Works staff requested authorization to increase a sole-source contract to cover extensive demolition and mold abatement tied to a cart-wash leak.
John Thomas (Public Works) said the water intrusion was first identified in September 2011 and that abatement and demolition work continued into late 2012; invoices submitted by the contractor exceeded the originally approved contract, prompting the department's request to increase the contract "not to exceed" an amount required to close out work to date and finish remaining reconstruction.
Budget analyst staff recommended limiting the emergency authorization to $328,644 — the amount already incurred — and to competitively bid the restoration work for cost control and compliance with procurement rules. Mr. Rose told the committee that the timing between discovery and emergency declaration, and the lengthy delays, meant the situation did not clearly meet the code definition of a sudden, unforeseeable emergency.
Deputy City Attorney John Givner noted the administrative code's emergency definition (Administrative Code section 6.60) and cited examples where emergency contracting without bidding is appropriate; supervisors pressed for ways to tighten departmental reporting and suggested administrative notification triggers so the city administrator and controller would be looped in earlier for large potential cost increases.
Public Works said emergency mold abatement and immediate cleanup were completed and that the requested modification closes out costs already incurred while the remainder of reconstruction will be competitively bid. The committee accepted the budget analyst's amendment and approved the item as amended.
