Last year, a routine project to repair sewer and water lines in the Haight went awry when the contractor pierced a series of gas distribution lines. Businesses were temporarily closed, and there were months of finger-pointing.

Subcontractor Synergy Project Management, which had a $7.5 million contract, was fired. But the incident raised questions about San Francisco’s low-bid contracting process and why contractors with a poor performance history are repeatedly employed for new projects. Synergy has also been hired to do work on the upcoming Van Ness Bus Rapid Transit project.

But new legislation would change the low-bid process to a best-value system to evaluate contractors for new projects. Each city department would establish a bidding system based on price, safety record, past performance, management and labor competence, and other factors. Sponsored by Supervisors Scott Wiener, London Breed and Katy Tang, the Administrative Code amendment heads to the budget committee on Wednesday before next week’s Board of Supervisors meeting.

“The Haight Street situation was definitely the most visible example in recent memory of what happens when a contractor is not held accountable,” Wiener said.

‘Makes no sense’

“The fact that the city has no real way to account for poor performance in the past makes no sense,” he said. We need to make sure we are contracting with firms that do a good job and get the project done on time and on budget.”

Under the current bid system, only the price tag is considered, and the lowest bidder automatically receives the contract. No other factors are included in awarding the project. But factoring in other job performance aspects has become more commonplace across the state.

Seven California counties, the Los Angeles Unified School District and the University of California system have already adopted a best-value bidding system.

The best-value system would allow department heads to hold open meetings to establish contracting criteria. The final price bids would be divided by a score on a number of criteria, like safety and labor compliance, and the lowest resulting bid would be given the project.

The process provides better incentives and increases the competition for contract deals, said Nicholas King, manager of Public Works’ performance and accountability program. Cities that use best-value bidding see projects conclude more quickly and often finish under budget, he said.

“The simple idea that past performance is an indicator of future performance is reasonable,” he said. “We should be able to weigh in on that. In the next 10 years, we are going to be spending $30 (billion) to $32 billion in the capital program. You get what you pay for, and there are some bad incentives associated with low-bid contracting.”

Greater transparency

The best-value system can also create a more transparent process among the city, contractors and residents. Steffen Franz, chairman of the Park and Recreation Open Space Advisory Committee, a group of 22 people appointed by their district supervisors to advise the Recreation and Park Department, helped shepherd a $10.2 million renovation to his neighborhood green space, Lafayette Park, in 2012. Communication among the entities fell apart, he said, and there were few updates on how the renovation was progressing.

“The big issue for me is the handoff between the contractor and the stakeholder,” Franz said. “There needs to be more transparency and communication. We need to make sure that, as building and construction booms, we are hiring people who will be the right fit for the job itself. Right now, people are price-driven 100 percent. Every contract the city does basically starts and ends with the cost.”

While some residents worry that scrapping parts of the low-cost bid policy would increase the price of city projects for taxpayers, Wiener contends that it would block irresponsible contractors — many of whom have filed costly change orders and drained city resources — from being hired again.

The environment needs to change, said John Doherty, business manager and financial secretary for the Electrical Workers Union.

“The problem is you have people that have a track record of not completing jobs or not doing it right,” he said. “It costs the taxpayers money to have it redone by city workers. Projects should be scored accordingly so they don’t fall victim to someone who comes in and puts the lowest number in with no intention of completing the job.”

And maybe, he said, under the best-value system there would have been fewer utility line breaks in the Haight.

Lizzie Johnson is a San Francisco Chronicle staff writer. Email: ljohnson@sfchronicle.com Twitter: @LizzieJohnsonnn