Politics
Lurie, Chu unveil first use of new contracting powers under Proposition E
Mayor Daniel Lurie and City Administrator Carmen Chu announced citywide contracting ethics rules, the first exercise of authority granted by voters under Proposition E. The measure, leading 64-36, gives the city administrator sole power to set contracting rules for $6 billion in annual spending.
Mayor Daniel Lurie and City Administrator Carmen Chu on Tuesday announced the first use of expanded powers voters granted them under Proposition E: a set of citywide standards governing how San Francisco signs contracts.
Proposition E, which was leading 64-36 with nearly all votes counted, gives the city administrator sole authority to change how the city awards contracts. Contracting accounts for about $6 billion of the city's $17 billion annual budget, covering everything from basic office supplies to core services such as homelessness outreach and street maintenance crews.
Lurie said the existing rules are inadequate because they are "scattered across different sections of city law, and the rules can vary â leaving room for corruption and abuse." The new legislation, he said, is "the first step toward centralizing and depoliticizing contracting so it serves San Franciscans, not insiders" â a phrase he used repeatedly during the $14.5 million, privately funded campaign that led to the charter package's passage.
Chu framed the standards as support for the city workforce. "Every day, dedicated public servants make decisions about how San Francisco spends taxpayer dollars," she said. "They deserve clear rules, practical guidance, and the confidence to speak up when something doesn't seem right."
The new standards would:
- Prohibit giving certain vendors an advantage by sharing confidential information. - Require employees to disclose conflicts of interest and potentially recuse themselves from contracting decisions. - Route communication between city staff and potential contractors through official channels. - Bar employees from splitting purchases or contracts into smaller amounts to avoid competitive bidding or other requirements. - State that violating the ethical standards could result in termination or other discipline.
Chu said the standardized rules "will set the foundation for a new culture around how the city does business."
The announcement comes as Lurie's own contracting decisions have drawn scrutiny. In October 2025, his office awarded a $5.9 million contract to digitize the city's permit system to OpenGov, despite city staff recommending a competitor and expressing doubts that OpenGov could handle the work. OpenGov subsequently missed several key deadlines.
Under Proposition E, legislation introduced by the city administrator takes effect automatically after 60 days unless the mayor or a majority of the Board of Supervisors blocks it. The board cannot amend such legislation. Chu will have to wait until late December or early January to formally introduce the rules because election results have not yet been certified.