DPH bond update: projects advance but a multi‑million-dollar deficit remains; agency seeks alternatives

Capital projects staff updated the Health Commission Sept. 5 on the Public Health and Safety bond program and related hospital projects.

Mark Primo (Capital Projects Oversight) and Terry Salts (Zuckerberg General facilities director) described efforts to close a roughly $111 million projected deficit on 2016 bond projects. After accounting for identified alternate funds and abatements the shortfall could fall to about $83 million, they said. Strategies include pursuing state grants (including funds for adolescent behavioral health), applying interest earnings from bond proceeds, leveraging a recent MOU with the San Francisco General Foundation (MOU cited at $18 million), pursuing a potential 2024 bond with a $33 million critical infrastructure category, reducing perceived contractor risk and scope where feasible, and sequencing early demolition to lower bid premiums.

Public Works project manager Joe Chin provided project-level updates at Zuckerberg San Francisco General (Building 5): the Dallas project and seismic upgrades are in active construction, public health lab demolition and trenching are underway, and the psychiatric emergency services (PES) early-demolition project is 99% complete with main renovation approvals pending. Several projects target completion in late 2024 or early 2025; the adolescent behavioral health inpatient/outpatient scope is included in the grant and has a projected completion date in 2027.

Commissioners asked clarifying questions about adolescent behavioral health infrastructure and project timing; staff said they are still establishing grants and planning and that construction will follow grant and procurement steps. No formal vote was taken; staff will return with more detailed budget mitigations as contracts and funding strategies mature.