Hi There, all you eager young voters!
Thanks for coming to learn more about Prop G!
Summary: There are 2 major problems with Proposition "G" in how it allows new contracts to be awarded.
1st problem is that instead of contracts going to the lowest bid from a qualified contractor, it would allow "other factors" to be considered. "Other factors" might be the bidder is a union shop, or a DEI bidder, but it might also be did the bidder make big campaign contributions or provide Rolex watches (details on That below). Simply put, vote NO ON G if you want the lowest qualified bidder to get city business. If the lowest qualified bidder doesn't get the contract, then the city (i.e., You) is paying too much for city services and someone is making extra money (AKA your tax dollars) that they couldn't get on merit alone.
2nd problem is that Prop G allows "Design-Build" to replace "Design-Bid-Build" in city contracting. What does that mean? "Design-Bid-Build" is the traditional way of making a contract. A design team is contracted to design the project. Once that is done, the completed design is put up for bid and the lowest qualified bid builds the project.
With "Design-Build", the project is put to one contractor who does both the design and the construction of the design for the price agreed to before the design was completed. There are so many problems with this so we'll just list a few. The design team usually acts on the city's behalf to make sure that the design is fully and reliably done. If the designers and builders are one and the same, there is no incentive for the designer to ensure the builder is doing quality work, and a perverse incentive to suggest changes in the design to inflate costs. We give several examples below. And No, oversight committees don't help - as we shall see!
- We start with why we think “G” is a bad idea.
- Then we give examples, government audits, and criminal cases showing where “design-build” and other procurement processes that would be allowed by “G” allow for corruption.
1. Allow A City Councilmember To Decide Who Wins Big City Projects?!
Currently, Sunnyvale requires new projects to go to the lowest bidder - period - end of story. No council member or group of council members can influence that decision. As the Sunnyvale City Attorney writes “This competitive bidding process is based on the bid price alone and does not permit the City to consider … other factors”.
“G” would change that! Prop G would allow “other factors” to decide the awarding of contracts. This is soooo... simple - if the contract isn’t going to the lowest bidder, then it’s costing taxpayers more than it has to. Prop G is going to make city services more expensive than they need to be.
If "G" passes then it’s only a matter of when the corruption sets in - and you won’t read about it - it will show up quietly in poor maintenance for parks, greater fees for garbage service, water rates, higher property taxes - all because new city contracts are going to the best-connected bidder, not the most cost-effective.
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| Sunnyvale Parks in the future? |
If the city council and staff can decide on what “other factors” can be considered, they can be influenced by a bidder to decide on a factor favoring them. This isn’t a hypothetical issue - it is the source of a lot of corruption which we will discuss later. IF IT CAN HAPPEN - IT WILL HAPPEN!
Corruption isn't something that only happens in 3rd world countries or decaying urban centers. According to the Harvard University Center for Ethics, California is in the worst tier of corruption ("Very Common") overall with a score of 19 (higher is worse), with only 4 states worse (!!) and not by much (19.5 - 22.5). For comparison - Oregon = 8, Massachusetts = 6, New Jersey = 20.5, Illinois = 21 - see map below. California is tied for corruption with Mississippi, Georgia, and Pennsylvania!
Map from:
Corruption is very real in the majority of cities at one level or another. A UN study of 134 cities around the world found over half the people in them had experienced corrupt practices at one level or another as seen in the graphic below - nearly 60% had to give bribes to get a service, nearly 30% almost daily or monthly. 84% cited corrupt local elected politicians, 82% cited local government officials - in both cases about a third saw this either "almost daily", or several times a month. You may not see it but there are California officials who take bribes and sell their discretionary votes or approvals as we see below.
Graphic from https://unu.edu/article/corrupt-cities-and-post-pandemic-ethical-antidotes
Vote NO on G!
Keep corruption out of Sunnyvale
2. Design-Bid-Build (current = lowest cost) vs. Design-Build (Measure “G”)
The most basic problem with “design-build”, is that the designer has every reason to increase the cost of the “design” since they will be doing the “build” as well. As some of the following examples show, this often comes about after the contract is awarded as changes are recommended by the designer (who is also the builder).
City council members are no more familiar with large construction processes than the average voter so will go along with the suggested changes and the cost increases they generate, not out of corruption, but because they generally have no experience in construction projects.
3. Other Problems with Design-Build
Loss of Independent Oversight & Quality Control Check Points
1. In the traditional design-bid-build (that Sunnyvale currently uses), the architectural/engineering firm acts as an independent advocate for the contracting agency (Sunnyvale, in our case), actively overseeing the contractor's work to ensure adherence to quality standards and design specifications.CA state auditors specifically pointed out that:
2. In (Measure G's proposed) design-build, because the designer and builder work for the same entity (or are the same firm), the internal checks and balances are removed. The owner loses an independent advocate on site to call out subpar construction or substituted materials.
4. Examples of Design-Build cost overruns and corrupt influences:
(A) California High Speed Rail design-build change orders produced huge additional costs.
In an enormous “design-build” fiasco, the State Auditor found that the High Speed Rail Authority had approved more than $600 million in change orders on three Central Valley construction contracts. The original contracts totaled approximately $2.5 Billion, and change orders added $600 Million, while also contributing to an 11-month schedule extension. In addition, the HSR Authority estimated that it would need an additional $1.6 Billion in contract changes resulting in a $2.2 Billion increase over the initial $2.5 Billion estimate for an 88% increase in costs.
Because contractors were awarded fixed-price/design-build packages on incomplete groundwork, the Authority faced thousands of change orders.
Costs for initial contract segments Doubled, leading state audit reports and legislative oversight panels to heavily criticize the premature use of design-build.
The “oversight committee” didn't fix these problems. The State Auditor found that in four of 11 change orders it examined, the Authority either:
i) approved more money than its independent oversight firm recommended, or
ii) approved additional money for work the oversight firm initially believed was already covered by the contract.
In one example, the contractor sought more than $21 million for unanticipated bridge work; the independent oversight firm estimated $7.4 million, while the Authority ultimately approved $18.6 million. The Auditor said the Authority couldn't provide documentation explaining how it arrived at the higher figure.
(B) The Belmont Learning Center Scandal (Los Angeles, CA)
Context: In the late 1990s, the Los Angeles Unified School District (LAUSD) used a design-build approach to fast-track the construction of a massive high school complex atop a former oil field.
Cost Overruns & Subjective Evaluation: The project’s cost ballooned from $150 million to over $300 million, making it one of the most expensive high schools in U.S. history at the time. Over 100% increase in costs!!
Corruption & Legal Investigations: A formal investigation by the Los Angeles District Attorney’s Office highlighted that the "best value" subjective evaluation inherent to design-build created an environment prone to favoritism and a breakdown in public trust. The District Attorney's report explicitly warned that design-build lacks the safeguards of traditional competitive low-bid systems, opening the door to public suspicion, conflicts of interest, and fiscal mismanagement. A 671-page internal audit conducted by LAUSD Inspector General Don Mullinax in late 1999 uncovered evidence of millions of dollars in fraudulent billing.
The report noted "probable cause" that certain acts or omissions violated criminal laws.
(C) Maryland Purple Line Light Rail (Maryland)
Context: A major $5.6 billion public-private design-build project intended to build a 16-mile light-rail line connecting Montgomery and Prince George’s counties.
The original design-build contractor walked off the job due to over $800 million in cost overruns and delays, leading to a multi-year settlement process.
By the time a replacement contractor was hired, overall project costs increased by over $1.4 billion, demonstrating that design-build does not always insulate taxpayers from huge cost increases. A $5.6 Billion project became a $7 Billion project - a 25% cost increase.
(D) San Francisco Department of Public Works in 2022
As a classic case of what can go wrong if city officials are given too much power to decide who gets city contracts and approvals, consider the following:
Mohammed Nuru, ($278,586 annual salary) the former Director of the San Francisco Department of Public Works was sentenced to 7 years in federal prison after he pleaded guilty to a multi-year wire fraud and bribery scheme involving his use of his discretion in choosing contractors.
He extracted over $1 million in cash, perks, and favors from eager contractors seeking city work over twelve years. This helped finance his Stonyford ranch, covering mortgage costs via laundered payments, custom home construction, and property upgrades supplied directly by favored vendors.
He had an affair with the SF mayor and gave her some of the bribery money he got. And he got one city contractor to give him a $36,500 Rolex! Once he was told he was being investigated he impeded the investigation for almost a week after he was charged, warning all his partners in crime about the investigation, despite being explicitly told not to.
U.S. Northern District Judge William Orrick said Nuru’s sentence reflected how severely Nuru’s crimes as a public official breached public trust.
“...you made the city’s decision-making and competitive bidding a farce… By awarding [contractors] and favoring them in exchange for money, gifts, trips, a job for your son and construction for a home, a vacation home, ... During my time on the bench, I’ve sentenced people for really horrible things.... In many ways, what you’ve done is at least as reprehensible.”
There were over a dozen officials and corporate entities charged in the city scandals.
Nuru’s nickname of “Mr. Clean” for his department’s efforts to spit shine the city, proved to be the height of irony.
“Mr. Clean”!! You can’t make this stuff up!
All this and more in:
(E) Case of Los Angeles City Councilmember Jose Huizar
This 2023 sordid case with nearly a dozen individuals with convictions or guilty pleas involving well over a million dollars and a 13 year prison term for Huizar, shows that if councilmembers have the power to influence government decisions, it will attract those who can see the opportunity for abuse of that power and lead to abuse of their position.
City council members are there to set policy, NOT to be involved in the allocation of contracts and approvals.
No On G!
Let's keep Sunnyvale from becoming a cesspool like LA and San Francisco
