“S.F. Wins Spot in New Federal Public Housing Program”
Mayor Ed Lee vowed last year to remake what he calls "poverty housing" - and his plan has started to take shape.
The San Francisco Housing Authority, which has long run some of the most ramshackle public housing developments in the state, has won approval to participate in a new federal program to allow private affordable housing developers to take over the properties in exchange for a requirement to upgrade them.
The mayor's administration and Housing Authority officials say the units' miserable conditions - including rodents, mold and elevators that break down for days or weeks at a time - will finally be resolved.
Well, soon anyway. Tenants should see major improvements in 12 to 18 months, officials say.
The Chronicle last year revealed major dysfunction at the Housing Authority, including a federal inspection ranking it as one of the two worst public housing agencies in the state, allegations that its leadership steered contracts to friends and political allies, and lawsuits filed against now-fired director Henry Alvarez alleging retaliation and discrimination.
Tenants said complaints to the Housing Authority about their living conditions have long gone unanswered. At Clementina Towers South of Market, for instance, a woman's bathtub was clogged and filled nearly to the brim with brown water for months, leaving her unable to bathe. And seniors and people in wheelchairs in that building reported being stranded for days when elevators went out of service and weren't repaired.
The mayor dismissed nearly all of the Housing Authority commissioners and promised major changes. The first major one to come to fruition is the U.S. Department of Housing and Urban Development's approval of the Housing Authority's application to be part of its Rental Assistance Demonstration program.
That means the Housing Authority will essentially privatize management of 21 public housing projects (about half of the city's such developments) with a combined 2,141 units by giving private affordable housing developers an incentive to invest in the properties in exchange for rehabilitating them.
Under the program, HUD, which funds the Housing Authority, has agreed to change they way it funds housing at those sites, combining money that was previously earmarked for operations or modernization into a single fund and then allocating it as a voucher for each unit, Olson Lee said.
Often, because of federal budget cuts, the full operating costs have not been provided, and housing authorities around the country have had to maintain their units with paltry budgets. Under the new program, HUD is locked in to providing 100 percent of the promised funding for 20 years, Olson Lee said.
Trade for upgrades
That will provide a steady stream of revenue that private developers, both nonprofit and for-profit, know they can rely on if they take over management of the buildings. Developers, in turn, would be required to make fixes to extend the building life for at least 20 years.
The city will seek bids on the management contracts, which will provide developers with long-term leases on public housing sites, perhaps 99 years, in exchange for upgrade work. Developers would also be paid a fee, estimated at $2 million per site, to cover their costs and risk.
Allowing private developers to do the upgrade work opens doors to financing that's not available to public housing agencies, including federal tax credits on low-income housing improvements and repairs.
City officials estimate private developers will be able to draw on $180 million from investors, backed by the tax credits, federal grants and any other affordable housing funds that may come available, perhaps from the state. The Housing Authority will retain ownership of the properties.
"The land will always be restricted for public housing and will be owned by the Housing Authority," Olson Lee said. "We're not about turning these into condos."
Gail Gilman is the executive director of Community Housing Partnership, which owns or manages 12 supportive housing buildings that house formerly homeless people and will likely apply to manage some of the public housing developments.
She said the city is fortunate to have many strong nonprofit housing providers capable of lending their expertise to public housing - and that she hopes the program not only improves apartments, but also improves tenants' lives enough that they can aspire to move out of public housing.
"I think most folks want to have healthy, thriving productive lives," she said. "If you're living in a property that's not well-maintained and not safe or secure, that's really hard to do."
Funds to make it work
Peter Cohen, co-director of the Council of Community Housing Organizations, said he's cautiously optimistic about the city's plan.
He emphasized that San Francisco has a strong network of community-based affordable housing developers and that the plan isn't to just farm out the work to a major national private developer akin to Lennar Corp. running the development of large swaths of Bayview-Hunters Point.
"I think there's a sensitivity and a commitment to housing the poorest of the poor in San Francisco that is much stronger than you'll probably find elsewhere," he said. "This is essentially extra money from the federally government to make the whole thing work."