Laguna Honda rebuild became logistical, financial nightmare 

In the midst of the 11-year Laguna Honda Hospital rebuild, state inspectors showed up to check out the ground that had just been broken on the newest tower.

They quickly realized something was wrong. Very wrong.

The new tower was being raised within a few arms’ length of one of the old seismically unsafe hospital buildings on the campus. The inspectors were surprised to see the old building still there. According to the city-hired contractor’s plans, the old building had already been demolished. But there it was, not only still glaringly intact, but still housing patients.

The state inspectors immediately halted the work, insisting the construction endangered those patients. But the construction managers, already far behind schedule, noted the new tower was fully 18 feet from the old one, just shy of the state’s required 20-foot margin. They claimed they informed state officials of the change in plans months before, and argued the state inspectors were being inflexible and causing unnecessary delays. After lengthy negotiations, the state allowed work to continue, but only with the addition of expensive 24-hour surveillance of the site.

This example — described in interviews with a state hospital-construction regulator, a city inspector, and the project manager for the rebuild — is one of dozens of conflicts that made the reconstruction of Laguna Honda a logistical and financial fiasco.

Laguna Honda, The City’s nursing home for the poor founded 144 years ago, serves not just the elderly, but also people debilitated by disease or injury, or unable to live on their own due to developmental disabilities.

In 1999, after federal officials threatened to close the old hospital for seismic dangers and overcrowding, voters came to the rescue with a $299 million bond to help build a new $400 million hospital on the same 63-acre campus.

At the time, voters were told they could expect the project to be completed by 2006. Today, the final completion date is not expected until 2013, although patients started to move into new rooms in the facility last month. Even though the project has been drastically reduced in scale from a promised 1,250 beds to just 780, it will cost $584 million — nearly 50 percent more than initially anticipated.

The Department of Public Works oversaw the construction of the new hospital, which is owned and operated by the Department of Public Health.

Laguna Honda spokesman Marc Slavin and other city officials blamed the busted budget on the skyrocketing costs of construction in the early 2000s. But while escalating construction costs certainly were a factor, they were hardly the only reason for the project’s troubles.

A San Francisco Examiner analysis of hundreds of records filed with California’s Office of Statewide Health Planning and Development, the state agency that oversees the construction of hospitals, reveal new details about how the project turned into what critics have described as a boondoggle.

“This was a very complex project,” said Paul Coleman, OSHPD’s deputy director. “It was just one of those situations where the complexities created the need for a lot of front-end, thorough planning. Some of it may not have been as well-thought-out as it could have been.”

The setbacks came in many forms. In one case, a pipe connecting to a stove hood in the kitchen was longer than the approved plans, an error that delayed the patient move-in date for weeks while new approvals were obtained and the pipe was rearranged. Even the way televisions were mounted on the hospital’s walls required multiple negotiations and contributed to the ocean of paperwork.

City staff involved in the project said the state’s heavy-handed management of the project also added to the delays and cost overruns. Most building projects are regulated and inspected locally, but hospital projects have a second layer of oversight by OSHPD.

The project’s manager and its inspector of record, both city employees, said the project bogged down under that oversight.

James Kennedy, The City’s inspector of record for the project, said local inspectors like him often had to negotiate the tension between OSHPD’s stringent requirements, and city contractors’ desire to get the job done quickly.

“It’s really difficult to build a hospital in California,” said Kennedy. “It’s a very unrewarding situation. We’re caught in the middle of the bad news from Sacramento and delivery from the project managers.”

Department of Public Works Project Manager John Thomas, who has been in charge of the project since 2006, hesitated to directly criticize OSHPD and said they have an important job. However, when talking about specifics, irritation laced his words.

He described frustrations over the state’s “double jeopardy” approval process, in which a specific piece of the project was approved by OSPHD plan-checkers, but once construction began, the same agency’s inspectors arrived and found new fault with the approved plans.

For example, plans had been approved to make a hallway a certain width and they were being constructed that way. However, when it was mostly completed, inspectors noted that when the doors were wide open and pressed up against the wall, the few-inch thickness of the door narrowed the hallway below the approved width. The halls had to be redesigned and rebuilt.

Technically, they were correct, but the late discovery cost money and time.

“So you have to revise the design and resubmit it for another approval, and there goes five, six, seven weeks in time that just click off before you know it,” Thomas said.

In another instance, the plans called for an emergency exit from one building to go through a locked ward — a major planning error that was caught by neither city nor state reviewers until the project was almost finished. Ultimately, that locked ward and a second one were eliminated from the plans entirely because it would cost too much to engineer fixes to the planning errors.

Despite the years of frustrations and delays, the ultimate product of the work is something that everyone interviewed by The Examiner said they are proud of. But Thomas admitted the project was too expensive and late to satisfy voters who supported it in 1999.

“And at the end of the day, that’s what the voters are looking for: that you promise something and you deliver what you promise,” he said.

Despite setbacks, moving day is a happy one for patients

When Michael Williams’ mother got a sneak peak at the room he’d be living in at the new Laguna Honda Hospital, she came back into his room at the old hospital with a wide smile.

“She was amazed,” he said. “She’s saw it before I did, and she came to me and said, ‘Mike, you are blessed. Your new place looks like a four-star room.’”

Williams, an HIV patient confined to a wheelchair, lived in the old Laguna Honda Hospital for 14 years. Last month, the new hospital — built immediately next to the old one — was finally declared complete enough to populate with patients. Williams and more than 700 others were handed their medical records, and one by one, they were brought to their new home.

The patients took their leave of a ward that, after decades of housing the elderly and sick, retained a permanent tang of urine. Many left behind wards crowded with beds separated only by faded blue-gray curtains. They passed intricately tiled walls soon to be demolished because they are laced with lead, and covering walls stuffed with asbestos.

The buildings they were wheeled into boast nearly a century’s worth of new amenities: spacious rooms, shared by at most four people and graced with views of San Francisco’s surging hills or puckered ocean. Residents now have access to a pair of pools, poetry classes, a ceramics lab, a library, a small petting zoo, a beauty salon. Art graces virtually every wall of the building. Patients are embraced by an ubiquitous new-building smell.

When the staff was preparing to move the patients to the new facility last month, Health Commissioner James Illig visited the old hospital for a meeting and described the feeling there.

“Yeah, there’s disappointment about how much it cost, how many obstacles we had to overcome,” Illig said. “We’re just happy, though, to be moving. All our frustration is forgotten. People are really overjoyed that finally the day has arrived.”

Medical records

Records obtained by The San Francisco Examiner from California’s Office of Statewide Health Planning and Development, the state agency that oversees the construction of hospitals, show that state inspectors had major concerns about the quality of the work at Laguna Honda. More than 1,000 change orders had been filed, some for major changes, some for very minor alterations. Here is an abbreviated timeline describing a handful of the change orders and inspection reports from recent years:

May 2006: The fire sprinkler water gong device came apart when tested.
March 2007: The project is using plastic sheeting, blue tarps and other plastic sheeting, for weatherproofing. This creates a fire hazard and an unsafe condition on the jobsite.
Sept 2009: Change order for addition of bedpan washer fixtures to patient toilets. Also that month, inspectors discovered that several fire extinguishers were broken.
October 2009: The pharmacy’s exiting path had been secured in a manner that would create a locked space with no escape. This problem had still not been fixed several inspections later.
November 2009: Contractor is, again, not prepared for testing of alarm system for this project.
December 2009: When one of the furniture movers were questioned about what to do in an emergency, he stated he had not been trained. The movers were asked to stop work on the installation of furniture and equipment until all the fire safety measures had been met.
January 2010: The radio communication system for the emergency fire watch was not reliable. … Construction debris was found on 6th floor southwest stairwell landing. Door was blocked open.
April 2010: Anchorage for the aviary, or bird cage, had to be redesigned.
June 2010: Two separate tests of emergency generators failed.

Source: Office of Statewide Health Planning and Development

Then and now

Promised: Four new buildings: two seven-story towers, a five-story tower and a four-story connector building, linking the towers.
Delivered: Three new buildings: one seven-story tower, a five-story tower and a four-story connector building.

Promised: Beds for 1,250 patients
Delivered: Beds for 780 patients

Promised: A project cost of $401 million
Delivered: A project cost of $584 million

Promised: Project completed by 2006
Delivered: Project now expected to be completed by 2013

Source: San Francisco Department of Public Health, Laguna Honda Hospital

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Katie Worth

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