The controversial software system that Mayor Daniel Lurie championed to overhaul San Francisco’s archaic permitting system, with little transparency and no formal bid, just got a contract extension.
But after major scrutiny over OpenGov’s spotty performance, the Board of Supervisors dialed back a request by the mayor’s allies for a $33 million extension through 2031. OpenGov will instead get a $22 million extension through 2029.
This came after a 10-1 Tuesday vote by the Board of Supervisors, with Jackie Fielder the lone dissenter. A majority of supervisors, including those who criticized the deal for eroding public trust in City Hall, lauded the amended deal for keeping the city’s leverage intact amid reports about OpenGov’s rocky rollout.
“I’m grateful to the mayor’s office for coming to the table and negotiating a new contract that we can all live with,” said Supervisor Chyanne Chen, who proposed the amendments Tuesday, prior to the vote.
Chen, like other supervisors, said there’s no question that a world-class, modernized permitting system is sorely needed in San Francisco. But she and even some of the mayor’s allies agreed that OpenGov’s performance didn’t justify a costly, $33 million ask by the mayor’s office without clear plans beyond 2027.
“This gives [the city] enough flexibility to continue the implementation of permits but gives the board stronger oversight and accountability tools,” Chen said.
The total contract amount has thus been reduced from $38 million to $28 million. A new provision for the contract approved today, which was only proposed after the deal came under public scrutiny, gives supervisors the option to terminate the contract without needing to prove a breach or wrongdoing.
“I’m hopeful this is something we don’t live to regret and can look back on, saying, ‘Aren’t we all glad we brought scrutiny to this?’” said Supervisor Matt Dorsey before the vote.
Lurie hailed the deal in a Tuesday afternoon statement — albeit without acknowledging it had been reduced in scope in both time and money.
“Every hour we save a small business owner is another hour they can spend serving San Franciscans, and every hour we save a homeowner is one they can spend with their family instead of at the Permit Center,” Lurie said. “In the next phase of PermitSF, we will keep our foot on the accelerator so homes can break ground sooner, businesses can open their doors faster, and San Francisco’s recovery can continue moving forward.”
OpenGov was pitched as the only software capable of meeting aggressive deadlines to streamline city approvals for building projects. It was installed with no formal bidding process by the mayor’s office in October, despite a competitor scoring higher in evaluations and over the objections of departmental staffers.
The software has since missed key deadlines, and city workers say they’re still using it simultaneously with the old permit tracking system due to ongoing bugs with OpenGov’s handling of even basic permits.
“San Francisco is our home, so this work is personal to us. PermitSF shows what’s possible when committed public servants, the right technology, and a relentless focus on residents and businesses come together,” OpenGov said in a statement after the vote. “We’re proud to continue partnering with the City, making permitting faster, simpler and more transparent for everyone who lives and works here.”
The decision to extend the contract came after multiple public hearings in recent months showed disagreement at City Hall over OpenGov’s performance.
There have been questions about whether the procurement process was above-board, and whether the $33 million additional investment was sound amid mixed results from OpenGov’s first year.
The Board of Supervisors Budget and Legislative Analyst in June found that Lurie’s award to OpenGov — a tech firm with connections to Lurie’s former nonprofit, Tipping Point — “did not conform to typical City practice or best practices,” but also “did not violate city requirements.”
While OpenGov is eventually supposed to consolidate the city’s permitting redundancies under one platform, three workers from different departments who spoke to Mission Local said their teams are still forced to use the old system it was meant to supplant simultaneously with OpenGov.
The San Francisco Standard also recently reported that while PermitSF Director Liz Watty claimed OpenGov was exceeding its goals for permitting times, internal city data said otherwise.
“Fire and sprinkler permits used to take two days and now take eight to nine,” Supervisor Bilal Mahmood said before the vote. While he acknowledged the possibility that OpenGov was getting over learning curves, he added, “This is not the outcome we were promised and not one the city should be asked to accept for the next five years.”
Fielder was the lone supervisor not sold on the compromise.
“I want to make one thing clear — I am not questioning whether San Francisco should have an integrated, best-in-class and corruption-free permitting system,” said Fielder. “Until PermitSF gets a firm handle on operations, the Board of Supervisors has no business expanding the contract beyond the recommended one year.”