More bad news for Concord’s partner Lennar-Five Point in CNWS project

It is not surprising that following my articles which were recently published which questioned the viability of Lennar-Urban and their subsidiary Five Point Holdings Inc. to finance the Concord Naval Weapons Station (CNWS) Reuse Project, a wall of silence  prevailed.

The San Fernando Spine Flower being designated as an endangered specie puts yet another nail in Five Points Newhall Ranch coffin
The San Fernando Spine Flower being designated as an endangered specie puts yet another nail in Five Points Newhall Ranch coffin

No one involved in local government seems to be willing to admit the distinct possibility that they have been dealt a losing hand selecting Lennar.

At the City Council meeting on September 13, 2016, not a word was mentioned about the serious charges brought forth about Lennar and their shell companies that might question their ability to do the job necessary to make the promises in the glossy four color brochure sent to every Concord resident come to fruition. Instead, the City Council spent a considerable amount of time discussing the composition of the largely ceremonial Citizens Advisory Council (CAC) that will oversee the new development.

For them, the fitness of Lennar to be their partner working together on the CNWS was not an issue. Since then a couple events have transpired concerning two of the chief components of my previous criticisms of the Master Developer selection process by the City of Concord of some note.

The “poor” stress rating for Lennar issued on September 2nd Dunn & Bradstreet (D & B) which stated that the company could be a candidate for bankruptcy in the coming year. Because of the magnitude of this dire prediction, apparently there was a lot of pressure placed upon D & B to review their previous findings. The results were published by the credit rating service on September 13th.

At that time D & B confirmed their previous findings that Lennar currently has an abundance of financial problems. If such a conclusion does not raise a red flag for the Council, City Manager, and staff, what will be needed for them to reconsider tying the knot with Lennar?

Would not change the dismal stress test rating given to Lennar Lennar
Would not change the dismal stress test rating given to Lennar

Considering the recently-obtained information, it would be a dereliction of duty for City management not to demand audited financial information immediately from Lennar for Five Point Holdings Inc. And why would the City not want this information?

Of equal concern is an article published in the San Fernando Valley News on September 14th which read in part:

[CBD] – In response to a settlement with the Center for Biological Diversity to speed protections for 757 species, the U.S. Fish and Wildlife Service proposed today to protect the San Fernando Valley Spine Flower as a threatened species under the Endangered Species Act. There are only two known populations of the flower, which is so rare it was once thought to be extinct.

The San Fernando Valley spine flower is an annual plant in the buckwheat family that grows low to the ground with small, white flowers. Historically it was found in washes and sandy areas in only 10 locations in the foothills of Los Angeles and Orange counties.

All 10 of these locations were lost to development, and scientists thought the species was extinct from 1929 until a population was discovered in 1999 in Ventura County and the Service placed the flower on the candidate waiting list for protection. In 2000 an additional population of the flower was discovered near Santa Clarita in Los Angeles County, within the footprint of the proposed Newhall Ranch Development Project.

The Ventura County population is protected from development because it occurs in a designated open space preserve. The population in the footprint of the Newhall Ranch development has been proposed for management under a conservation plan developed by the company, under the state Endangered Species Act, that allowed the company to remove part of the population in exchange for creating preserves to protect about 75 percent of the plants.

Protection under the federal Endangered Species Act will require the company and state to work with the Service to develop an expanded and supplemented conservation strategy.

The people of Santa Clarita apparently don't want to build a new community that resembles Agrestic as depicted in the notorious TV series "Weeds"
The people of Santa Clarita apparently don’t want to build a new community that resembles Agrestic as depicted in the notorious TV series “Weeds”

What this all means is that my previous comment that the shovels Lennar had in storage for ground breaking to occur on their Newhall Ranch development would be getting rusty waiting for the ceremony to occur, might be a bit of an understatement.

With the spine flower being designated for protection under the Federal Endangered Species Act, Lennar’s Kofi Bonner’s prediction of getting the Newhall ranch development back on track within a couple years does not seem to be even remotely realistic. Along with the California Supreme court’s decision in November 2015 to shelve the Newhall Ranch Environmental Impact Report (EIR), Five Point’s current principal asset is for all practical purposes DOA.

Coupled with the liabilities of Five Point is the debt held by the Third Ave Fund left over from the bankruptcy of Lennar’s LandSource subsidiary back in 2008. As such, why in the world would Concord want to be connected with them? It would appear them getting involved Five Point would be the equivalent of hiring the Captain of the Titanic to be your safety consultant.

This whole deal of Concord selecting Lennar has made no sense from the offset. By the city in effect running Lennar’s competitor Catellus Development out of town, the CNWS Reuse Project is in the hands of an inferior vendor with no solution in sight.

What has transpired in the last couple days with D & B sticking with their decision in down grading Lennar and the spine flower being placed on the endangered species list, ought to be a wake-up call for city government in Concord who is betting their future on a losing hand with few alternatives available.

Perhaps they should listen to Kenny Roger’s advice of “knowing when to hold em’, knowing when to fold em’, and when to walk away.”

Are these people willing to stake their futures on the ability of Lennar to be there so called partner and deliver the project the community yearns for?

We shall see.

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Bitterness still remains on selection process that made Lennar-Five Point developer for CNWS Reuse Project

By Richard Eber

Ted Antenucci, long time CEO of Catellus Development Corporation, seems to be a man at peace with himself. Picking over a Chinese Chicken Salad while at lunch with me August 12 in Aurora Colorado, the celebrated developer defended his decision to accept a token $250,000 fee in May of this year from the City of Concord to withdraw his company for consideration to become master developer for the 3 billion dollar Concord Naval Weapons Station (CNWS) Reuse Project.

Catellus President Ted Antenucci decided to "Take the money and run" rather than continue to deal with the powers that be in concord.
Catellus President Ted Antenucci decided to “Take the money and run” rather than continue to deal with the powers that be in Concord.

Given what had transpired during the past year with the competition Catellus had with Lennar-Urban, he didn’t think his firm could get a fair shake in dealing with Concord’s City Council and their administrative staff.

Despite the fact that Catellus has had a sterling track record of building successful developments while at the same time possessing a sound balance sheet, in Antenucci’s mind the City of Concord inexplicably worked overtime to discourage his bid. He was equally perplexed of why Concord was supporting Lennar Corp’s competing proposal which the city staff earlier stated was inferior to what his company had tendered?

Even worse, Antenucci reasoned, Catellus had none of the baggage that came with Lennar: no bankruptcies, no FBI investigations, no bribery allegations, no fraud judgments, no Dun & Bradstreet downgrade, and no failed IPO. No employees and consultants like Willie Brown or Keith Jackson were part of the Catellus team either.

Antenucci eventually decided to cut his losses and move on. In his mind, capital-rich Catellus has enough on their plate dealing with municipalities that are trying to recruit them. Why put themselves in a position to be involved where they were not wanted, he concluded?

Another aspect of Antenucci’s concerns was that in order to be successful in competing with Lennar to land the Concord contract, he felt Catellus would have had to engage in questionable business practices that were not of his firms play book. Antenucci’s firm, who in the Bay Area is best known for their work done with the San Francisco Giants in the area surrounding AT&T Park at Mission Bay, took responsibility for not recognizing earlier the poisonous political climate in Concord and for not getting out of the CNWS bidding earlier.

What led to Ted Antenucci dropping the Concord project like a hot potato? It all began July 30, 2015 which was the reporting time for political donations for state offices. The following month Catellus learned that then Concord Mayor Tim Grayson, who was running for the State Assembly, had received $14,800.00 in concealed donations from businesses directly affiliated with Lennar. This, he felt was in contradiction to a side agreement the two parties previously agreed to not lobby to be chosen for the Master Developer slot.

Catellus was furious about these payments even after Grayson, who feigned ignorance on the origin of the funds, ended up giving the money back. The only regret Grayson publicly expressed was not vetting who sent large checks for his Assembly campaign earlier. A few weeks later when it was revealed that Grayson had met twice with Willie Brown, purportedly seeking only “political” advice on running for the Assembly, Catellus was fit to be tied.

Brown, who openly lobbied on behalf of Lennar, was Kofi Bonner’s mentor when he was Mayor of San Francisco. Even worse, Brown and his partner Steven Kay were principles in Golden Gate Development. This firm was working directly with Lennar to raise capital utilizing EB-5 funds which gave foreign nationals green cards for job creation in the USA.

Also upsetting Catellus was that one of the parties who contributed $4,200.00 to Grayson’s campaign was Brown’s partner Steven Kay. Another individual donating to Grayson was Philip Bunting, whose public relations agency regularly represents Lennar. On top of that Kofi Bonner’s daughter had served on their advisory board.

An additional conflict of interest that disturbed Catellus was that Tim Grayson’s then campaign manager was Mary Jo Rossi, also a protégé of Willie Brown in the Assembly. She had strong ties to Steven Kay and Philip Bunting. Catellus had a difficult time believing that it was a mere coincidence that all of this money flowed into Grayson’s campaign with nary a clue about the origin of these funds.

Concord Mayor Tim Grayson-state-of-city
How the CNWS selection process will effect Tim Grayson’s Assembly bid will not be known until November 8th.

Things got even more estranged between Mayor Grayson and Catellus when Grayson’s personal attorney (San Francisco insider Jim Sutton) along with Mary Jo Rossi were working hand and hand trying to convince Concord City Attorney Mark Coon to push forward with the developer vote at the same time Coon was investigating Catullus’s allegations of wrong doing.

Coon quickly cleared Catellus of charges brought forth by Grayson that Catellus was engaged in a conspiracy with discredited developer Albert Seeno to take over the CNWS project. There were also allegations Coon rejected that Catellus was purchasing tickets to Golden State Warrior games for city staff to curry favor with them.

Things became even more inexplicable when Mark Coon tragically committed suicide in late October of 2015 during the midst his investigation of Catullus’s allegations of unfair treatment. Whether the turmoil which was going on with the CNWS project played a role in this tragedy has never been determined.

Trying to right the ship, the Concord City Council brought in an independent party respected attorney Michael Jenkins to look into what was going on in the Lennar-Catellus struggle. Two months later, the investigator came out with the Jenkins Report which said that Lennar definitely broke their agreement not to lobby the City council by virtue of the side agreement made earlier.

It was difficult for Jenkins to come up with any other conclusions about Lennar’s activities because neither Mary Jo Rossi, Kofi Bonner, Willie Brown, nor Steven Kay was willing to speak with him directly.

Though unintentional breaking the Brown Act's open meeting laws was the tip of the iceberg in the turmoil involved with the CNWS selection process
Though this action was unintentional, breaking the Brown Act’s open meeting laws was the tip of the iceberg in the turmoil involved with the CNWS selection process

Mr. Jenkins condemned Lennar’s influence peddling, but made no recommendations to the Concord City Council on how they should conduct themselves on a go-forward basis.

Shortly afterwards, the staff report under city project manager Michael Wright endorsed the Catellus proposal. Apparently this did not please the City Council. Mayor Laura Hoffmeister, City Manager Valarie Barone, City Councilman Edi Birsan, and Tim Grayson. They tried to keep this recommendation away from the public. As it turned out, in doing so they were in violation of the Brown Act.

What made this even slimier was that although several news media outlets, including the Bee and East Bay Times exposed the cover-up, nothing was done to censure or disqualify Lennar from the CNWS selection process. In making this decision the Council appeared to use the “everybody does it” excuse to leave Lennar in as a finalist.

Ironically, Michael Jenkins, who presented his findings to the Concord City Council one night, stayed in town to give a Brown Act tutorial to the same group the following evening.

Tim Grayson, who had been leader of the anti-Catellus forces, ended up recusing himself because of conflict of interest issues. Councilman Ron Leone did not participate in the selection process on the recommendation of the city attorney’s office because his house is located within 500 of the Weapons Station property.

Given what had transpired, it would appear that Catellus with their seemingly superior proposal and not breaking the any lobbying side agreements, was in a good position to receive the Master Developer contract. In addition they had a strong financial position that did not require them to mortgage the property they were developing to pay for infrastructure costs.

Another major difference between them and Lennar is that Catellus planned to auction finished building sites in the CNWS project to the highest bidders. This contrasted with Lennar, who proposed to sell the land essentially to themselves as they planned to build 60% of the housing in the CNWS.

When it is taken into account that Lennar would be subbing out the construction of 25% of the project which is to be of the affordable housing variety, according to present plans they will control 90% of market rate residential property sales and construction.

Under these circumstances, Lennar would have no incentive to sell property at its highest value since in effect they would be selling it to themselves. This could come into play because amenities such as parks, bike trails, and recreational facilities at the CNWS are to be paid for principally from land sale revenues.

None of this mattered as the selection process continued. Even with the damnation of Lennar in the Jenkins report, the City Council decided to keep them as a viable finalist in the selection process. This decision was now in the hands of only three members of the City Council: Mayor Laura Hoffmeister along with City Councilman Dan Helix and Edi Birsan, who were still eligible to vote

With only three individuals making the decision on the developer, it soon became obvious to Ted Antenucci that his company would not be selected. There was still a great deal of hostility with the City Council because of Catullus’s alleged aloofness along with airing their dirty linens in public rather than doing this more in private with the City Council.

Indicative of this Edi Birsan commented at a Council meeting that he didn’t trust Catellus quipping he should wear a Kevlar vest to avoid being stabbed in the back by them.

Only Councilman Dan Helix, who is retiring at the end of November, seemed to be in favor of partnering up with Catellus. Seeing the writing on the wall, Ted Antenucci negotiated a buy out with the city. Once the agreement was made, the money was wire transferred into Catullus’s account the following day.

While Kofi Bonner and Lennar appeared to get the victory they coveted so much; no binding agreements have yet been executed by the two parties  It will be up to Guy Bjerke, who succeeded Michael Wright as project director along with City Manager Valarie Barone to negotiate the final terms with Lennar-Five Point.

Concord has shown some concern for Lennar’s bankruptcy with LandSource by limiting the amount of property they will allow them to control to no more than one 60 acre parcel at a time. Even if this provides some degree of security to Concord, the Council must also realize that they are dealing with an entity that has joined the exclusive club of Enron and Trump University in being represented by attorney Daniel Petrocelli in litigation matters.

Yet to be determined is how the transparency, co-operation, and team work both parties have pledged will unfold in the coming months and years ahead.

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The Affordable Housing Czar answers all questions

My mission in life is to explain with total impartiality what is going on with the rental market locally and throughout the entire State.

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Let me introduce myself. Experts in the business call me “Mr. Affordable”, the Housing Czar. I am totally non partisan not being a Democrat, Republican, socialist, green, red, blue, libertarian or any derivation thereof. My mission in life is to explain with total impartiality what is going on with the rental market locally and throughout the entire State.

Who, what, where, and how is California going to solve their affordable housing crisis?
Who, what, why, where, and how is California going to solve their affordable housing crisis?

To answer your queries:

What is affordable housing?

This is a good question. In reality “affordable” is what people have ability to pay without draining their economic resources to support their families. “Affordable”, can also be defined in part by where people are living. In Danville where the average family income is well over $150,000 per year contrasts with Concord where about $68,000 supports the medium household. A better criterion is that rent or a house payment should be 30% or less than the gross disposable income of those living in a residence to be affordable

This is why families are struggling in the Monument Corridor of Concord where few can meet this 30% threshold. As a result two or even three families are forced to live in a 2 bedroom apartment. In addition to having crowded conditions, combining families leads to kids to spending more time on the streets. Historically, such a predicament has resulted in increased gang activities and problems for law enforcement.

The word affordable also comes up with Section 8 Housing where governmental agencies subsidize rents for those who are unable to put a roof over their heads. It is supplying this type of dwelling which most cities dread because of the problems associated with those who reside in these places.

Does rent control make housing more affordable in communities where it is being practiced?

Rent Control does make housing less expensive for those individuals who have been residing in housing covered by it for a long period of time. Good examples of this are apartments discussed in last week’s article in San Francisco which ranged from $ 1400.00 to $3600 per month for the same unit. For those who move into rent controlled apartments in tight urban markets, they end up in most cases paying a higher amount as landlords try to compensate for lost revenues.

Rent control also ends up tying up fluidity in the marketplace as those who live in apartments covered by it lack incentive to move. Constricting housing inventory tends to reduce competition putting those with large incomes in the driver’s seat when space opens up at the expense of those with less buying power.

Does rent control even with the intervention of Government Boards to hear grievances improve the quality of the apartments under their jurisdiction?

affordable housing that more resembles barracks than place people would want to live are projects cities want to avoid
Affordable housing that more resembles barracks than places people might  want to live are projects cities want to avoid

In most cases just the opposite occurs.  If a long term tenant is paying significantly less rent than the market commands, landlords have little incentive to make capital improvements such as heating, bathrooms, kitchens, etc…  As a result rent control units seldom see a facelift which entails anything more than an occasional coat of paint or a new faucet if the old one can’t be repaired.

Other than helping to protect people from unsafe conditions, rent control boards do not have the power to make property owners make any improvements beyond minimum code standards. As proof of this reality when a previously rent controlled unit is vacated, it is only then that property owners are inclined to make major improvements. They call this phenomena “capitalism” When government intervention messes with the laws of supply and demand, good things seldom happen.

Why has there not been more housing built to meet the demands of moderate income families that rent control is designed to protect?

This is a complicated question whose answer  sounds like the old advertisement for Anacin which touted a “combination of ingredients” to lesson headaches. To start with when Jerry Brown began his third term, the first thing he did to deal with the State’s budget woes was to put an end to Redevelopment Program that encouraged cities to rid themselves or blight and replace it in most cases with affordable housing. Combined with the effects of the recession, little new construction has been done since Brown took office.

But wait there’s more! Another leading factor to the absence of affordable housing being constructed in the Bay Area and throughout California are all the laws, taxes and permit costs which make every apartment constructed expensive before the first shovel is turned. Environmental impact reports, seismic studies, water hook-ups, road improvements, money for public transportation, electricity, sewers, schools; you name it, they must get their cut.

Along with these factors which often include government regulation from more than one jurisdiction is the high price of land in the Golden State. Reducing the amount of buildable property by imposing urban limits of where construction can occur along with creation of more open space, has taken its toll without much consideration of what the consequences of these policies might have in the marketplace.

What is Jerry Brown been doing to rectify the affordable housing shortage since he has been in office 6 years ago?

To make up for past mistakes Gov. Brown want to bypass local planning processes to meet demands for more affordable housing to be built
To make up for past mistakes Gov. Brown want to bypass local planning processes to meet demands for more affordable housing to be built

Trying to fix what is wrong Brown wants to jump start the construction of affordable housing in the state to make up for past mistakes. Already the effects been visible not only in the lives of low income folks, but also has lead to an exodus of high paying jobs from California to places where housing is more affordable for families.

What Brown has proposed is the State taking over the planning process from local communities to short circuit getting the all the prerequisites  needed to construct housing. His ideas are geared to streamline the approvals process for multi-family housing developments that are built in urbanized areas and include affordable units. If passed, this proposal would mean that eligible housing proposals across the state would be given the “green light“ by right,” meaning they would not be subject to case-by-case local approvals or review under the California Environmental Quality Act.

To put it another way the Governor wants the State to determine what is to be constructed in local communities including density discounts, no matter how their consequences effect traffic and congestion. In taking this “Big Brother” approach which would negate local control of urban planning, it did not occur to Brown to repeal the laws and regulations that have constricted new developments in California in the first place.

This could never happen as admitting past mistakes have never been even a minor part of the Progressive agenda.

What are the chances Brown’s plans if enacted will work?

Let’s play the point spread. When was the last time any project undertaken under the supervision of State Government every come in on or under budget? As an example look at the cost overruns on the construction of the new span for the Bay Bridge or the work that has been going on forever on Hwy 4. The defense rests.

With regards to constructing new projects respected developer Merle Hall stated, “The best way to create affordable housing is to allow the forces of an unrestricted free market to work. Government involvement does just the opposite. It creates undesirable cheap ghetto housing because from the economic standpoint, taxpayer subsidies are not going to build the Taj Mahal.”  (Or should have Hall referred to then as the Section 8 Estates?)

Will the new development at the Concord Naval Weapons Station include enough affordable housing inventories to make a difference?

Despite their pledge to spend $ 40,000,000 to build affordable housing in the first phase of construction, Urban Lennar whom the Concord City council choose to develop the CNWS property, has a dismal record recently of creating this product.

Outside of costing the States retirement fund almost 1 billion dollars with the bankruptcy of LandSource in 2009, they have yet to build one unit of low income housing at Mare Island. Lennar’s performance is almost as dismal in San Francisco’s Hunter’s Point development where thus far they have delivered fewer than 10% of what they promised to construct by 2015

This is not entirely Lennar’s fault. There have been some hazmat problems in both places. In addition constructing low income housing is less profitable than building market place units. As a result this needed product is often the last thing constructed in large developments. As an indication at the CNWS, Lennar first plans to build over 200 market place units when the final  approvals are in place. Affordable  can come later.

When will construction be started and completed in the Concord project?

Perhaps the better answer might be in whose lifetime? While the advocates of low and moderate income housing were in ecstasy when the new plans for the base were unveiled, very few will be breathing when the first phase is completed. Realistically, it will be 10 years at the earliest when anything of substance will be built.  Double that for any affordable units of large numbers.

Why is “Mr. Affordable the Housing Czar” so cynical and cranky about government trying to spur development of badly needed new housing inventory?

History! Just review what has transpired during the last quarter century to determine if respect can still be found in the morning.

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No easy answers for Affordable Housing crunch

Affordable housing in Concord is an issue that City Council must address

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According to the urban dictionary the updated version of the adage “two wrongs don’t make a right” can be defined as: “It is not acceptable to do something bad to someone just because they did something bad to you first.” When it comes to affordable housing, apparently the State of California doesn’t get the message.

jerry brown ignores unfunded liabilities
Jerry Brown talks out of both sides of his mouth on the subject of constructing more affordable housing

After spending 40 years creating road blocks for local communities to develop affordable housing, they have done a complete u-turn. Jerry Brown is pushing to have the state take over the jurisdiction of local communities and build large developments to meet demand. The Governor hopes to usurp power from communities of local building codes, environmental reviews, permit processes, and infrastructure improvement requirements to spur construction of so called affordable units.

Brown has a short memory because right after being elected in 2008, he shuttered the Redevelopment Program that was used as a mechanism for cities to build affordable housing. Now he wants to replace this with a bill before the legislature giving the State unprecedented power over local communities to speed up the construction of residences for lower income families.

In doing so, Brown has shown no inclination to reduce bureaucratic procedures and laws that have made California the most expensive place to own property in the continental United States. As an indication in 2014 the median value of owner occupied housing in California was  $371,400.00. The second highest in the continental USA was Massachusetts at about $330,000 followed by New York $283,700 (including New York City) In contrast, Texas was at $131,400. California’s neighbors Arizona and Nevada, home owner’s property was valued at well less than half of the Golden State.

In trying to fast track affordable housing Brown he in effect is admitting that the complicated-expensive dog and pony show system that the State has imposed on developers on all levels has been a failure.  Theresa Karr, Executive Director of the California Apartment Association Contra Costa Napa Solano Division complains “all of the over-regulation the state has been doing is being remedied by more regulations.”

As the head of the East Bay chapter of the League of Cities, Ron Leone has made affordable housing a top priority of his group
As the head of the East Bay chapter of the League of Cities, Ron Leone has made building increasing housing inventory a top priority of his group

Outside of giving their citizens the chance to rent affordably and  have the resources to purchase homes and condos, the high price of housing has resulted in well paying jobs fleeing to other States such as Nevada, Arizona, Texas, and parts of the Midwest where it is easier for families to have the resources to make a down-payment. As a result in California, most of the job growth in the past decade has been in service industry positions where minimum wages prevail.

Meanwhile,  local communities who have lost redevelopment funds from the State seven years ago  are increasingly asked to provide more services the legislature previously funded.  This is especially in the fields of housing and transportation.  Concord City Councilman Ron Leone, President of the East Bay chapter of the League of Cities stated, The League of Cities is pushing the State to pay for affordable housing to make up for redevelopment being eliminated. “We don’t want them mandating what we build. Our organization insists on local control.Don’t give us so many restrictions. We don’t want big government gelling us how and what to build”

While these battles are going on between the State and their minions, local communities are trying to deal in their own way with an increasing housing shortage. This development has resulted in raising rents and displacement of long term residents who can no longer afford to live where they have resided for many years. Especially impacted has been the predominantly Hispanic Monument Corridor of Concord where rents in some cases have almost doubled the last couple years as the demand for affordable housing has increased in the Bay Area.

Trying to contend with short and long term regional conditions that have led to the current housing crunch is a difficult task for local government. For Concord Mayor Laura Hoffmeister, who has served on the Concord City Council almost 20 years, the current crisis is not her first rodeo. She said “Almost every city in the Bay Area including ours is struggling with this issue which is one of supply and demand.  We could anticipate the shortage of affordable housing when the State ended redevelopment giving us no control of what was to follow.”

For Concord Mayor Laura Hoffmeister, handling cerimonial functions is much easier than dealing with keeping the cost of rent down for her constituents in the Monument
For Concord Mayor Laura Hoffmeister, handling ceremonial functions is much easier than dealing with keeping the cost of rent down for her constituents in the Monument

Hoffmeister went on to say there are some things the city is doing including a multi-family rental inspection and bed bug program in place for several years.  She said after attending some recent community meetings, it became known to her that many renters were not aware that these programs were even in existence. Hoffmeister said she has reached out to Tenants Together and others to spread the word on what the city is doing to assist those who live in low income units.

Concord’s mayor concluded “There are no overnight solutions but we are trying to do our part with Eden Housing, HCD Management, development in the new Concord Naval Weapons Station Project, and other planned construction of residences, to meet demand.” She does not believe present conditions merit trying to impose rent control programs such as what has been done in Oakland, Berkeley, and San Francisco.

Ron Leone agrees is saying “The problem with rent control is that it suppresses cost of housing in one area, discourages people from moving, and takes away incentives of property owners to make improvements. You are in effect helping one set of people at the expense of others because when apartments become available, those who move in will have to pay more.”

Concord City Council member Edi Birsan has been the most outspoken individual among elected officials who is willing taking strong actions to deal with rising rents  leading to displacement of long term residents.  Birsan had to bring up the affordable housing crisis up four times at City Council meetings before it was finally sent to the Housing Committee headed by Tim Grayson and Dan Helix for discussion.  He believes dialogue should take place in several areas including

  1. Lack of affordable housing not only in the Monument corridor, but in the rest of the city as well
  2. A possible price cap on rent increases
  3. 1 year leases be offered to new residents
  4. Eviction “just cause” regulations be looked at.
  5. Cracking down on slum lords.
  6. Promotion of funds for affordable housing be pushed by the City Council
  7. The program the city is undertaking to reduce permitting costs to build mother-in-law units in existing homes
  8. Increasing density bonus’s for affordable housing especially around BART and transportation hubs.

The talking points Birsan and the other officials in Government along with special interests on all sides of the affordable housing equation are all well taken.  There are so many aspects to be considered that fixing what is wrong is a daunting task.

It is apparent that there is no “one size fits all” approach that is suitable for every city and community.  Are actions that might be taken constructive or putting more kerosene on the affordable housing crunch? The question all are asking is where to start?

Next week- Is rent control the answer?

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Standing up to bureaucratic tyranny

Just like Britain, California, especially the San Francisco Bay Area, is being governed, to paraphrase and quote Mr. Nelson, by officials Californian’s “don’t know, people whom they never elected and cannot remove from office.”

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“A date which will live in infamy.” That is what President Franklin D. Roosevelt told Congress the day after the Japanese attacked Pearl Harbor, Hawaii. The attack occurred on December 7, 1941.

WPJ_summer_bureaucracyThe president sought — and received — a declaration of war against Japan. Congress took less than an hour to pass the declaration.

June 23, 2016, may be another date that will live in infamy. On that date, British voters decided that their country should leave the European Union (EU). The EU is a 28-nation trading bloc that covers most of Europe, including Britain.

The EU is the world’s largest trading group. The EU’s output of goods and services exceeds that of the United States.

The British vote was 52 percent to 48 percent in favor of quitting the EU. The term for British departure from the EU has been called “Brexit.”

In an June 24 essay in The Wall Street Journal, Fraser Nelson, wrote a long article bearing the headline “a very British Revolution.” Nelson is the editor of the Spectator and a columnist for the Daily Telegraph. Both publications are British.

In his essay, Nelson said: “The Brexit campaign started as a cry for liberty, perhaps articulated most clearly by Michael Gove, the British justice secretary. . .”

Nelson continued: “As a minister [Mr. Gove] said, he deals constantly with edicts and regulations framed at the European level — rules that he doesn’t want and can’t change. These were rules that no one in Britain asked for, rules promulgated by officials whose names Brits don’t know, people whom they never elected and cannot remove from office. Yet they become the law of the land.” Much of what we think of as British democracy, Mr. Gove argued, is now no such thing.”

California is plagued by the same phenomenon as Britain: Unelected bureaucrats are imposing taxes, fees, and regulations on the state’s residents.

Perhaps, some day California will have a similar vote, rebelling against unelected bureaucrats.

In the San Francisco Bay Area, there are three prominent bureaucracies that threaten liberty. They are the Metropolitan Transportation Commission (MTC), the Association of Bay Area Governments (ABAG), and the San Francisco Bay Restoration Authority (SFBRA).

Each of the three agencies has authority over the nine-county Bay Area.

Among the three agencies, voters have not directly elected any member of any agency’s governing board. Yet, these three agencies have imposed taxes, fees, and regulations on Bay Area residents.

On July 18, 2013, MTC and ABAG, in a joint meeting, voted in favor of Plan Bay Area, a scheme to impose, on all Bay Area cities, high-rise, high-density housing.

On January 13, 2016, SFBRA’s board of directors voted to place a property tax on the June 7, 2016, ballot. The money derived from the tax is, according to SFBRA’s website, to be used “to generate funds to protect and restore San Francisco Bay.”

The California State Legislature set up SFBRA in 2008.

Measure AA passed. The “yes” vote was 70 percent; the “no” vote was 30 percent.

Just like Britain, California, especially the San Francisco Bay Area, is being governed, to paraphrase and quote Mr. Nelson, by officials Californian’s “don’t know, people whom they never elected and cannot remove from office.” The words in quotation marks are Mr. Nelson’s.

On June 6, 1978, California’s voters, enraged over rising property taxes imposed by unelected officials, passed Proposition 13. Property taxes were going up without voters’ approval. Proposition 13 rolled back existing property taxes, put limits on how much such taxes could rise, and required voters come up with a two-thirds supermajority to pass future property-tax increases.

Has the time comes for California to have another tax revolt like Proposition 13?

Will California mimic Britain and have a voters’ rebellion against bureaucracy?

The time for change in California may be coming.

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End of Homeless Outreach Program leaves major void for County

Closure of Contra Costa County’s non-prof homeless outreach program leaves big hole in services for the homeless and mentally in living on the streets and camps

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At exactly 12:01 A.M. on June 30th life will never be same in Contra Costa County. The Homeless Outreach Program headed for the past decade by Doug Stewart is closing down.

The many faces of Homelessness Doug Stewart has dealt with for over a decade
The many faces of Homelessness Doug Stewart has dealt with for over a decade

During the evening hours underneath freeway on-ramps, bridges, and abandoned properties, those without a place to call home will no longer be visited by the familiar white van that delivered blankets, food, socks, medical supplies and other necessities. Even more important  Stewart provided hope of a better life to an indigent population who struggle with alcohol, drug, and mental health issues every moment of their lives.

It all started for him 12 years ago when then Supervisor Mark DeSaulnier appointed Stewart to the Mount Diablo Pacheco Municipal Advisory Council.  From this Stewart became aware of the day to day problems of the homeless. In trying to assist them tangible ways, he soon learned that homelessness is a regional issue, Stewart soon added Martinez, Richmond and other cities to what eventually evolved to become the present day Contra Costa Homeless Outreach Program.

Soon after that fateful moment when Stewart steps down from his unpaid post that has consumed most of his spare time administering to arguably the neediest segment of society, he is moving to Arizona to start a new life with his wife and three children.  Because the cost of living is lower in Arizona, Stewart was able to purchase a home there.

Outside of his regrets for not spending enough time with his family, Stewart is sorry to be leaving the people he served behind. “These individuals will no doubt suffer”, he says because they won’t have blankets, coats, O.D. Drug kits and emergency provisions we provided.” Stewart is also concerned about who will give the referrals to Homeless Shelters and social service agencies in his place?

Since resources in these areas are limited Stewart has had to determine those people that are most in need and have the potential to lift them from life in the street to become a part of normal society. Contra Costa Homeless Chief Lavonna Martin, who returned from a lengthy vacation on June 27th, will undoubtedly have a difficult task finding replacement liaisons with the homeless community in order to fill the void Stewart’s departure leaves behind.

Police departments especially in Richmond, Martinez, Concord, and Antioch, which have all been the major beneficiaries from Stewart’s organization over the years, will especially be affected by the program closing down. While visiting Homeless encampments administering to the residents, Stewart also gained intelligence on criminal activity going on in these places.

When appropriate, he has passed this information on to local police for which Stewart has enjoyed an excellent relationship. In addition, those in law enforcement believe his presence in some cases prevented the desperation that causes crime among the homeless community.

Stewart feels there will be additional visits required to the emergency rooms  and possibly more interaction needed from law enforcement  because of the soon be closed Homeless Outreach.  In agreement with this assessment is Martinez mayor Rob Schroder whose city has been a big supporter of the program from the outset.

shopping carts left near Hwy 24 tell a tale of what goes on beneath the freeway
Shopping carts left near Hwy 24 tell a tale of what goes on beneath the freeway

Since the County hospital, jail, and social services are located in his city, Schroder is worried that when the homeless are released from these places (especially at night) without Stewart,   they will linger and panhandle in Martinez until they find transportation.  In consideration of all the things that Homeless Outreach does in his community, their police department has given them $ 30,000 per year to deal with the Homeless in the past.

After June 30th, Schroder says his city is adding another $30,000 per year provided by the Tesoro Refinery to help fill the void left with Doug’s departure.  At the same time the mayor of Martinez says he is intending to meet with other cities in the area to see if they can better coordinate their efforts to help the homeless on a daily basis.

Past history has indicated that Contra Costa Counties approach to dealing with this growing problem is different than what goes on in individual cities do 365 days a year. While Homeless Outreach has provided transportation, food, medical supplies, and referrals for social services to people on the street, the County who administers the disbursement of these resources has different priorities.

The State and Federal Government especially has written guidelines that favor permanent solutions such as housing and job programs as opposed to immediate help that Homeless Outreach has provided.  As a result according to Doug Stewart only a minimal amount of money has been given to his organization by the County over the years.  One of the reasons he gave for quitting is because of becoming tired of being told by Lavonna Martin County Homeless Services Chief, “Thank you for your patience in receiving the grants we promised you but we don’t have the funding yet.”

Such a position appears to be in line with Supervisor Federal Glover who has a large number of homeless in his district. On one hand he recently said “You can’t replace Doug Stewart. He was valuable in so many ways. He went above and beyond what was called for.” At the same time he stated, “Unfortunately, in the state budget proposed by Gov. Brown, the state is cutting funding for homeless programs. Contra Costa homeless services are searching for additional funding; and/or seeking ways to continue.”

With regards to this problem Glover’s compatriot Supervisor Karen Mitchoff is basically of the same opinion. “Doug Stewart has a huge heart and gave of his time, talent and resources to the county’s most vulnerable of the homeless population, the “hidden” homeless, and we are losing a tremendous resource.  Even though Contra Costa County spends $6 million to assist homeless men, women and children to transition to permanent housing, there is never enough money to address the needs of everyone“, Mitchoff concluded.

Not exactly Motel 6 but a place where the Homeless call home
Not exactly Motel 6 but a place where the Homeless call home

Stewart in leaving his work with Homeless Outreach believes society and especially Contra Costa County can do a better job in dealing with “these people who have fallen between the cracks in society”. He thinks it is just not housing that will fix things. “Mental health counseling especially in the areas as alcohol abuse and drugs must go hand in hand. Jobs are also important,” he added. Stewart believes, “better leadership is needed on the County level on Homelessness for things to improve.”

And so it has gone with Doug Stewart who has  not only been constantly fighting for money to fund the expanding needs Homeless Outreach,  but also to take care of his own family whom he has needed to support as well. At the end he said “I just got tired of Lavonna and rest of the people at the County lying to me and not keeping their promises. It was not possible for me to continue this way any longer.”

Martin counters Stewart’s frustrations with the county in saying ” in the past, funds have not been available since 2008 to assist Homeless Outreach and other soft support services.” Because of a grant the County has recently received from the Federal Government for $ 550,000.00, some of this money can pay for services similar to what Homeless Outreach has been performing.” Martin said a Request for Proposal (RFP) is soon going out to do exactly this.

Stewart is not buying what Martin is saying “For the cost of an administrator or civil service position, the County could have given my organization enough funding so I would not have had to quit.”

Underneath the freeway off ramps life will like be different after June 30th. Few will know as only a handful of people  venture forth into this wasteland as Homeless Outreach has done for over a decade. Farewell Doug Stewart.

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