Santa Clara Valley Transportation Authority (VTA) officials are poised to bump up the agency director’s contract signing authority to $1 million.
If the Board of Directors approves the recommendation this fall, VTA General Manager Nuria Fernandez would gain twice the unilateral spending power she has now.
The proposal from the Ad Hoc Board Enhancement Committee would give Fernandez the authority to execute seven-figure contracts and purchases without approval from the 18 elected officials who serve as appointees on the VTA governing board.
The ad hoc committee, chaired by Mountain View Councilman John McAlister, argued that upping Fernandez’s contract signing powers would improve efficiency. Proponents claimed that waiting for the board to approve contracts has held up projects in the past.
Under the plan debated Thursday afternoon by VTA’s Administration and Finance Committee, the general manager’s $1 million-or-less procurements would only be disclosed to the public four times a year, in quarterly reports presented to the board.
“We felt that this was completely in line and still somewhat conservative against what a lot of the other agencies of similar or larger size were authorizing for the general manager,” VTA Chief of Procurement Officer John White explained. “In the last six months, we’ve taken a lot more control of the contractors, of reviewing invoices, of calling them in, holding them much more accountable, challenging them on various things that they’re requesting. I think that in line with the new steps that we’ve been taking, I think the million dollars is more than reasonable.”
Advisory Committee Coordinator Stephen Flynn said the change would result in anywhere from 20 to 40 fewer items going in front of the board a year—possibly more once the next phase of BART Silicon Valley ramps up.
But increasing the general manager’s powers of the purse, sparked some concerns over ballooning costs. One member of the public, Roland Lebrun, told the subcommittee that the recommendation was “coming straight out of consultants who are making campaign contributions to some of the board members.”
“If you approve this, you basically end up approving tens, or even hundreds of millions, of dollars that are going to go right back these consultants without any transparency,” he chided. “They’ve got it to a fine art, how to keep all these appropriations just below $1 million, and it just keeps on adding up.”
San Jose Mayor Sam Liccardo, one of four subcommittee members, said he could see how the expediency of higher contract limits might save money in the long run. Placing contracts on the board agenda, he stated, is a “constraining factor on cost escalation for consultants when they know that the number is going to be viewed publicly.”
“I guess I’m a little concerned just from the standpoint of cost control and also where this kind of goes down the road of lifting this limit,” Liccardo added.
The mayor said he would support the policy change if the VTA reported the general manager’s purchases every month instead of every quarter.
Santa Clara County Supervisor Cindy Chavez, who also serves as VTA board president, said she, too, harbors anxiety about “scope creep” since some consultants stand to profit from having contracts renewed without democratically elected oversight.
A final decision on the policy change, which will require a board vote to amend the VTA administrative code, is expected to take place at some point in the next few months.