This paper investigates the principal-agent problem in acquiring air quality monitoring data by administrative means in the context of multi-level environmental governance, and uses Shandong Province as an example to show how the corresponding contractual risks can be reduced through market-based means. We find that the Environmental Protection Bureau of Shandong Province reduces the risk of extortion due to asset exclusivity by setting entry criteria for participating bidding firms for the operation and maintenance of air quality monitoring equipment and data comparison, and improves the enforceability of incentives and penalties by signing performance contracts that directly link remuneration to the performance of monitoring services. These institutional arrangements improve the operational efficiency of air quality monitoring, facilitate the observation and control of relevant inputs, operational processes and quality of monitoring data, and create effective accountability for O&M units. Shandong Province's practical experience enriches the theory and practice of multi-level environmental governance and provides a useful reference for China and other countries to achieve institutional construction for sustainable development. In such a vast country like China, in order to provide efficient and accurate basic information for national environmental decision-making, it is necessary to pay close attention to and systematically analyze how monitoring services are outsourced at the provincial and sub-provincial levels of government, and their impact on the efficiency and data accuracy of monitoring services.