The way the contract was awarded has troubled staffers across a number of departments. Interviews with six people knowledgeable of the deal, as well as hundreds of documents obtained via public records requests, show that a competing bid scored higher than OpenGov and would have come in at a fraction of the cost to taxpayers. The OpenGov contract was signed by Segal earlier this month at an annual cost of $4 million \u2014 on top of $1.9 million in phased payouts.\u00a0<\/p>\n
The software company was co-founded by entrepreneur and investor Joe Lonsdale and CEO Zac Bookman, who have collectively given tens of thousands of dollars over the past decade to Tipping Point Community, the nonprofit Lurie founded and ran for 15 years before later becoming mayor. Bookman also gave Lurie $500 for his mayoral campaign. According to the nonprofit\u2019s website (opens in new tab)<\/a>, one member of OpenGov\u2019s advisory board, Katherine August-deWilde, also gave up to $2.85 million to Tipping Point and now leads the mayor\u2019s Partnership for San Francisco<\/a>, a coalition of tech and business figures advising Lurie on policy.<\/p>\n Max Szabo, a spokesperson for Tipping Point and a political consultant to Lurie<\/a>, said the donations to the mayor\u2019s former nonprofit had no impact on his office awarding a contract to OpenGov.<\/p>\n But the Lurie administration\u2019s interest in working with OpenGov was apparent from the start. On April 2, Segal offered Bookman a warm email introduction to the mayor\u2019s innovation director, Florence Simon. This message went out more than a month before the city officially sought vendors for a software overhaul of San Francisco\u2019s long-criticized permitting system.<\/p>\n \u201cZac can help us think through permitting technology,\u201d Segal wrote, adding a smiley face to a line that noted the OpenGov CEO had been \u201cpatiently waiting for the right partner.\u201d (The mayor\u2019s office told The Standard that Segal also introduced other companies to the city, though no email records were provided verifying such correspondence.)<\/p>\n Bookman helped found OpenGov in 2012 and has known Lurie for at least a decade. In 2015, the pair were photographed at an event in which 49ers NFL Hall of Famer Ronnie Lott, a former board member who helped found Tipping Point, gave Bookman a \u201cVisionary of the Year\u201d award (opens in new tab)<\/a>.\u00a0<\/p>\n When reached by phone, Bookman abruptly hung up and did not respond to The Standard\u2019s emailed questions about his company\u2019s contract with the city. OpenGov spokesperson Danielle Hoffman responded, \u201cOur product meets the City and County of San Francisco\u2019s needs today, and it will in the future, as we partner closely with all of our customers to innovate and shape our product roadmap.\u201d<\/p>\n Lurie, Segal, and Simon declined interviews. Charles Lutvak, a spokesperson for the mayor\u2019s office, confirmed that OpenGov\u2019s work on the permitting system began this week and defended the city\u2019s decision to select the company.<\/p>\n \u201cOpenGov brings the technology, support system, and track record of on-time delivery as we work across departments to provide a seamless experience for business owners and residents,\u201d Lutvak wrote in an email.\u00a0<\/p>\n Last year, Cox Enterprises acquired (opens in new tab)<\/a> a majority stake in OpenGov for $1.8 billion, significantly raising the govtech company\u2019s profile. OpenGov counts more than 2,000-plus government agencies across the country as clients, and its technology handles everything from procurement and budgeting to open data portals that promote transparency.<\/p>\n The deal to streamline San Francisco\u2019s labyrinthian permitting system across about a dozen major departments could cost the city tens of millions in the years to come.<\/p>\n OpenGov \u2018shouldn\u2019t be considered\u2019 <\/p>\n Lurie campaigned last year on bringing transparency, integrity, and efficiency to City Hall, and in February, he launched one of his first major policy efforts: PermitSF (opens in new tab)<\/a> intends to streamline a Kafkaesque permitting process that has played a role in multiple City Hall corruption<\/a> scandals<\/a>.<\/p>\n Currently, departments that help issue permits to businesses and homeowners use a smorgasbord of software platforms, and PermitSF\u2019s goal is to bring the entire process under one roof.<\/p>\n On May 20, the mayor\u2019s office of innovation issued (opens in new tab)<\/a> a \u201crequest for information,\u201d an informal process to assess how vendors can help on a project. The mayor\u2019s office noted to applicants that the process was \u201csolely for information gathering and planning purposes.\u201d<\/p>\n However, the city was interested in finding companies that weren\u2019t on its list of approved vendors, and the request for information process made this possible. As previously reported in The Standard<\/a>, the city currently uses 20 different software systems, and the plan was to preserve just four.<\/p>\n Vendors submitted proposals by a June 13 deadline, and staff from multiple city agencies were recruited to test the different products. One of the vendors included Clariti, a software company that currently contracts with the Department of Public Works. Records show that Clariti\u2019s software was consistently rated better by city staffers than OpenGov\u2019s technology, and its services would cost a fraction of the contract Segal ultimately signed with OpenGov.\u00a0<\/p>\n Clariti\u2019s annual software license would have cost $528,000, while implementation would run up to $1.6 million. By contrast, OpenGov\u2019s original proposal had a projected cost as high as $9.9 million.<\/p>\n \u201cThe general consensus of most testers is that Clariti is the most suitable of the 3 Products,\u201d states a July report with feedback from 16 technical city staffers. The report added that OpenGov\u2019s technology had \u201cgaps so significant\u201d that it \u201cshouldn\u2019t be considered.\u201d\u00a0<\/p>\n A scoring sheet shows Clariti was rated significantly higher than OpenGov in all eight technical categories, including how it handles data, security, and customer management. Across the categories, Clariti scored an average of 4.42 out of 5, while OpenGov scored 2.88. A third company, LeapThought, scored 2.5.<\/p>\n Other documents show similar findings, such as a July report from an employee at the city\u2019s data agency who said they preferred Clariti. An undated document from two planning department staffers concurred. City officials did raise concerns about Clariti, including delays the Department of Public Works has experienced getting the company\u2019s software operational. But the majority of graders for PermitSF still preferred Clariti.<\/p>\n In August, The Standard reported that Segal and Elizabeth Watty, who was named planning director two months before a final decision was made, had sole discretion in awarding the contract to OpenGov. A formal contracting process would have required them to use a more objective system that weighs costs and the quality of the technology.<\/p>\n \u201cMayor Lurie launched PermitSF not to tweak that system but to fundamentally transform it,\u201d said Lutvak, the mayor\u2019s spokesperson. \u201cThis work requires doing things differently right now.\u201d<\/p>\n \u2018An appearance of impropriety\u2019<\/p>\n Ed Harrington, who served as San Francisco city controller for nearly two decades, called the process that netted OpenGov its contract strange and noted how uncommon it is for the mayor\u2019s office to oversee a software procurement competition instead of the city\u2019s technology experts.<\/p>\n \u201cIt is highly unusual for the mayor\u2019s office to be directly responsible for this and signing off on these kinds of things,\u201d Harrington said.<\/p>\n Sources with knowledge of the contracting process expressed frustration with how OpenGov was chosen, noting that morale across departments has plummeted as a result. One source said the permitting software is unlikely to meet Lurie\u2019s goal of launching early next year.<\/p>\n \u201cPeople feel like we\u2019re going to get run over by a train in the next few months,\u201d the source said. \u201cAnd when it fails, they\u2019re going to blame staff.\u201d<\/p>\n On Aug. 26, Lurie and Segal announced in an Instagram post (opens in new tab)<\/a> that the city had picked OpenGov to overhaul the city\u2019s permitting system.\u00a0<\/p>\n \u201cWe\u2019re just trying to make life easier, more efficient, more effective, and deliver faster for the people of San Francisco,\u201d Lurie said in a video (opens in new tab)<\/a> that was retweeted by OpenGov\u2019s Bookman.<\/p>\n Lutvak, the mayor\u2019s spokesperson, told The Standard that Lurie, Segal, Simon, Watty, and the mayor\u2019s chief of staff, Staci Slaughter, all signed a form affirming they had no financial interest in any of the finalists considered for the PermitSF contract, a step that he noted went beyond city requirements.<\/p>\n However, Joan Harrington, a former director and current fellow at the Markkula Center for Applied Ethics at Santa Clara University, said the financial ties between OpenGov and Lurie\u2019s former nonprofit \u2014 combined with a contracting process that skirted norms \u2014 still gives off \u201can appearance of impropriety.\u201d<\/p>\n \u201cSan Francisco is a small city and they may have personal relationships by crossing paths over the years,\u201d Harrington said. \u201cBut there are facts here that would maybe suggest this wasn\u2019t the best decision for the city.\u201d<\/p>\n![\"Four](\"https:\/\/www.newsbeep.com\/us-ca\/wp-content\/uploads\/2025\/10\/1760534168_770_-S3840x2560-FPNG.png\"\/)
OpenGov\u2019s CEO Zac Bookman speaks with Daniel Lurie at a 2015 event. | Source: Carlos Avila Gonzalez\/SF Chronicle\/Getty Images<\/p>\n![\"A](\"https:\/\/www.newsbeep.com\/us-ca\/wp-content\/uploads\/2025\/10\/1760534169_512_-S3840x2560-FPNG.png\"\/)
Ned Segal joined the mayor\u2019s office after serving as Twitter\u2019s chief financial officer. | Source: Drew Angerer\/Getty Images<\/p>\n![\"Three](\"https:\/\/www.newsbeep.com\/us-ca\/wp-content\/uploads\/2025\/10\/1760534170_715_-S3840x2560-FPNG.png\"\/)
Bookman, center, founded OpenGov in 2012. | Source: Adria Malcolm\/Getty Images<\/p>\n![\"A](\"https:\/\/www.newsbeep.com\/us-ca\/wp-content\/uploads\/2025\/10\/-S3840x2631-FPNG.png\"\/)
Lurie is trying to overhaul the city\u2019s complex and burdensome permitting process. | Source: San Francisco Chronicle\/Getty Images<\/p>\n