Supervisors back airport contract with conditions: $25M cap and performance review required

Chair Supervisor Connie Chan on Feb. 1 moved to amend and forward a resolution modifying the San Francisco International Airport’s project management support contract with PGH Wong & Partners JV, requiring a contractor performance evaluation and reducing the proposed not-to-exceed amount to $25 million.

The item, introduced by Diana Volick of the airport, would have increased the contract by about $10.6 million to $27.85 million and extended the term through January 2025. Volick told the committee that the airport agrees with the Budget and Legislative Analyst’s recommendation to align the contract budget with the contract term and to perform a formal performance evaluation of the contractor.

Nick Menard of the Budget and Legislative Analyst’s (BLA) office said the modification is the ninth for this project and recommended lowering the cap to $25 million and requiring the airport to submit a contractor performance evaluation within 90 days so the board has the information it needs to assess further amendments. "We recommend approval of the resolution as amended," Menard said during his presentation.

Vice Chair Rafael Mendelmann pressed staff on the discrepancy between the $27.85 million figure and the BLA’s $25 million cap, asking whether the airport expects to exceed $25 million and whether the city would return for additional approvals under chapter 9.118. Claudia Lokey, director of project management at the airport, described the progressive design-build procurement approach and said costs and schedule are refined as trade packages are awarded: "We have a good sense of the anticipated cost and schedule, but because of the methodology that we use … the final cost is defined as we do the progressive award of trade packages."

Supervisors flagged the frequency of contract amendments and the lack of recent annual performance evaluations. Chair Chan said retroactive performance audits make it difficult for the board to hold contractors accountable and to evaluate amendments. The committee approved the amendment and forwarded the item to the full board with a 3-0 vote.

What happens next: The full Board of Supervisors will consider the amended resolution. If approved, the airport must provide the contractor performance evaluation within 90 days as recorded in the committee amendment.