The City and County of San Francisco allocates more than one-third of its $16 billion annual budget to procuring goods and services for San Franciscans. In doing so it must balance efficiency and effectiveness with responsible stewardship of and accountability for public resources. Achieving that balance has become increasingly challenging because of a complicated maze of legislation and policies that govern the procurement system. Lengthy contract processing times, which can range from 8.5 months to 1.5 years, burden city staff and discourage potential vendors, particularly small businesses and nonprofits.
Our research found that
1. Many well-intentioned policies have been passed to change the procurement process, resulting in a confusing maze of requirements that is difficult for staff and contractors to navigate.
2. Staff time and city resources are spent navigating the complexity of the process as opposed to finding the best vendor or actively managing selected contracts.
3. Structural barriers lead to a lack of competition, benefiting organizations with preexisting relationships with the city and experience navigating the system.
4. People, rather than systems, are blamed when things go wrong, which has led to a culture of fear and oversight.
5. The city has made many improvements to procurement processes, but the complex, decentralized nature of the system and limited resources make change slow and incremental.
6. Current contracting thresholds and requirements are not commensurate with the level of risk or the amount of a contract.
7. A collective understanding of what’s possible could help unlock potential strategies that could save time and lower costs.
SPUR offers nine recommendations to improve San Francisco’s procurement system. Implementing these recommendations will require a long-term vision, clear leadership and the political will to make tough decisions but would result in greater community benefits across policy areas.