Newsom’s hotel and lodging program breaks barriers in Bay Area

It seemed like a quick and easy way to solve the Bay Area’s massive homeless problem – using pandemic funding to turn hotels into low-cost housing for people with nowhere to go.

But it turns out it’s not that easy.

Almost a year after cities and counties in the region spent Gov. Gavin Newsom’s Homekey funding to buy properties for their homeless residents, some buildings are still not ready to provide long-term housing. Efforts to turn a motel near the San Jose airport into permanent housing came to a halt after a state lawmaker accused the city of offering rents that would displace the very people it is supposed to help . In Alameda County, plans to convert two hotels have stalled because authorities couldn’t find developers and non-profit service providers to take over the projects. And in North Bay, a developer is scrambling to find money for major renovations on buildings he has purchased.

“It’s part of Homekey’s first round, and frankly the state did a great job of getting it out quickly, but I think the flip side is that they are making it up as they go,” he said. said Vivian Wan, chief operating officer. agent for Abode Services, the nonprofit that oversees the San Jose Motel transition. “So I think a lot of rules and so on come after that fact. And I think the city and the state are just trying to figure it out. “

SAN JOSE, CALIFORNIA – OCTOBER 30: Traffic cones circle the empty pool at the Best Western Surestay in San Jose, Calif. On October 30, 2021. As the city strives to turn the temporary Roomkey Hotel into a Homekey plus project permanent residents are upset by the slow repair process that has left large openings under several staircases since May. (Anda Chu / Bay Area News Group)

Homekey was Newsom’s unprecedented push to increase the state’s supply of affordable housing as the homeless crisis spiraled out of control and health professionals feared people could catch and spread COVID- 19 in overcrowded camps or shelters. Most of the nearly $ 850 million was distributed in October 2020, and by December the state’s 94 projects had closed escrow.

Experts agree that the program was a godsend for housing the homeless. Cities, counties and developers are already lining up to apply for new funds in Homekey 2.0. But a look at some of the original Homekey projects in the Bay Area shows the challenges of the innovative model.

The Best Western SureStay Hotel in San Jose was already occupied when the city purchased it with funding from Newsom. For almost two years, it has provided free accommodation for homeless people for whom COVID-19 presents a particularly serious risk, such as the elderly or people with medical conditions. Earlier this year, those residents began receiving letters warning them that in October 2021, they should either start paying $ 627 per month or find new housing. Even though the rent was way below the market rate, to some people it still seemed impossible.

Cheryl Fleming, who suffers from COPD and chronic back problems, receives $ 974 per month in Social Security. She pays between $ 350 and $ 400 for a storage unit, car insurance, and a cell phone.

“I will not be returning to the streets,” said Fleming, 65. “I won’t make it if I go back to the street. I won’t live.

SAN JOSE, CALIFORNIA – OCTOBER 30: Cheryl Fleming talks about living conditions at the Best Western Surestay in San Jose, Calif. On October 30, 2021. As the city works to transform the Temporary Roomkey Hotel into a more permanent Homekey project, the residents are unhappy with the slow repair process which has left large openings under several stairs since May. (Anda Chu / Bay Area News Group)

Fleming, his neighbors and local activists started talking about the new rent and asking why the city wouldn’t set rents on a sliding scale so everyone pays a third of their income. This is how many homeless housing programs work. The questions caught the attention of Assembly Member Alex Lee D-Milpitas, who said he was “quite appalled” by the situation. He informed the state Department of Housing and Community Development.

After HCD intervened, San Jose froze the Homekey project while it worked with the state to re-examine its rent prices. Now, the site won’t switch to Homekey housing – or charge rent – until February.

In the meantime, residents of SureStay are frustrated with the time it takes for the city to renovate the property. The city made big holes in the hallway ceilings to check the condition of the building’s interior last spring. Months later, the holes are still there and locals say they are sometimes strewn with debris as they pass underneath.

“While the holes can be unsightly, they pose no structural problem,” city spokesman Jeff Scott wrote in an emailed statement, adding that repairs to the property are expected to take a few months.

SAN JOSE, CALIFORNIA – OCTOBER 30: Hector Chavez talks about living conditions at the Best Western Surestay in San Jose, Calif. On October 30, 2021. As the city works to transform the Temporary Roomkey Hotel into a more permanent Homekey project, the residents are unhappy with the slow repair process which has left large openings under several stairs since May. (Anda Chu / Bay Area News Group)

Alameda County received Homekey funding last year to transform two hotels near Oakland Airport – both of which are used as temporary pandemic shelters – into long-term housing. But neither of the two transitions started. By now, the county has been hoping to find developers and nonprofit service providers to take over the projects, said Kerry Abbott, county office director of Homeless Care and Coordination. But so far they have been unlucky.

“It’s always been an incredible influx of opportunities, and we’ve done our best to really use the opportunities as well as we can,” Abbott said. “But not to say it doesn’t come with challenges.”

In North Bay, the nonprofit Burbank Housing Development Corporation is still trying to fill the funding gap for the two Homekey Awards it received last year. Homekey grants typically cover the cost of purchasing a building, but not necessarily the cost of renovations or personnel, maintenance, and other running expenses.

“They just wanted to give you the money to house people quickly, and you were kind of on your own with how to do it in pencil for the next few years,” said Jocelyn Lin, associate director of real estate development at Burbank Housing. .

This is a particular challenge for older motels in need of major renovations, such as the vacant Economy Inn in Santa Rosa. Burbank Housing purchased the property with the Kashia Band of Pomo Indians from Stewarts Point Rancheria. Now they need to install new electrical and plumbing systems, add kitchenettes to every room and make the property accessible to people with disabilities before it can be used for long-term housing – no earlier than February.

“It was a struggle,” Lin said.

Other projects are moving slowly in part because there is still a need to use some buildings as temporary shelters for the homeless as COVID remains a threat. Homeward Bound of Marin plans to apply for a building permit this month to convert its Corte Madera hotel into long-term accommodation. A year-long renovation project to turn an office building in San Rafael into housing won’t begin until next summer. During this time, the two sites served as shelters.

“In the meantime, they have provided a viable service and have been able to help many very vulnerable homeless people stay on the streets, but also not live in gathering places where they may have contracted and spread COVID.” said Homeward Associate Director-linked Paul Fordham. “So they’ve already helped a lot of people. “

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