Since San Francisco Mayor Gavin Newsom took office in 2004, the city has failed to apply for $355 million in HOPE VI grants that HUD has made available for upgrading housing projects. Newsom is the only mayor of the past three who has failed to apply for this money, and his Administration does not intend to apply for funds this year either. To qualify for these funds, the SFHA would have had to seek and receive a waiver from HUD because of its current failing grades for the physical condition of the units and the financial condition of the Agency.

Rather than seek this waiver--which would acknowledge the Housing Authority’s problems--- the Mayor gave up the federal money and seeks to fund project upgrades by partnering with private developers and issuing revenue bonds. The lack of federal money means that the city will have to approve hundreds of market-rate condos near public housing sites to subsidize rebuilding of the low-income units, speeding the gentrification process.

Mayor Newsom’s announcement last Friday of a “new partnership” between the city and the Housing Authority was a positive, but long overdue, step. Considering that the Mayor appoints all Housing Authority Commissioners and runs the Authority without any interference by his frequent adversaries on the Board of Supervisors, the SFHA’s failures over the past four years are clearly his responsibility.

The Mayor seeks to add the $5 million already allocated for public housing repairs by the Board of Supervisors to a $95 million revenue bond in order to rebuild 700-900 public housing units. The goal is for this money to leverage another $700 million needed to accomplish this goal.

The Mayor’s approach to addressing public housing particularly impacts two projects in Bayview-Hunters Point – Hunters View and Alice Griffith. In some respects, the future of these projects have been clouded by the same confusion about the area’s future that has left vast swatches of land subject to the whims of the San Francisco 49ers and the Lennar Corporation.

And let’s not forget the T-line, yet another example of how Bayview-based projects seem to end up with unexpected difficulties.

The Mayor announced in January that he would make a campaign for a public housing bond to rebuid these Bayview-Hunters Point projects his “top priority.” But he later stated that polling on the proposed bond had shown it failing, even though he had never made an effort to build support around the issue. As a revenue bond, the Mayor’s new proposal avoids the backlash from property owners that defeated recent general obligation housing bonds.

By not attempting to secure federal funds, Newsom made linkage between the projects and accompanying market rate housing unavoidable. In other words, San Francisco could have secured money to rebuild the projects without handing over public land to the Lennar Corp, whose presence is now needed to build the market-rate condos necessary to subsidize the public housing rebuild.

In Saturday’s Chronicle story on Newsom’s announcement, SFHA chief Greg Fortner says that the city did not apply for Hope VI funds because there are 1,500 eligible housing authorities for federal HOPE VI funds, and SF wouldn't have a realistic chance.

But that's counting every housing authority in the nation. The real chance of San Francisco getting this money is much greater. Consider:

In fiscal 2004, 33 Housing Authorities applied and 7 got grants
In fiscal 2005, 29 applied and 8 got grants
In fiscal 2006, 26 applied and 4 got grants

Given San Francisco’s success at securing federal grants for homelessness and health programs, it is strange that the city would not even try to secure millions of federal dollars for public housing before turning to revenue bonds and the private sector.

By ignoring federal funds, Newsom made linkage between the projects and accompanying market rate housing unavoidable. In other words, San Francisco could have secured money to rebuild the projects without handing over public land to the Lennar Corp, whose presence is now needed to build the market-rate condos necessary to subsidize the public housing rebuild.

There is nothing inherently wrong about increasing density on public housing sites by adding market rate units, and such units will likely enhance the low-income unit’s livability. But residents understandably fear that this is yet another scheme to gentrify the neighborhood, and wonder why plans for more affordable family housing in Bayview remain up in the air.

The John Stewart Company, which did a great job rebuilding the North Beach projects, has a proposal to rebuild Hunter’s View. All 267 public housing units would be rebuilt, along with 80 new affordable rental units, 50 below-market rate condos, and 250-300 market-rate condos.

Although John Stewart has earned the scorn of tenant activists for its poor management of SRO hotels, its development track record is much stronger. But the Board of Supervisors might question why the city should help subsidize a plan that adds only 80 more rental units but as many as 300 market-rate condos.

If the economics demand such an imbalance, then a different strategy---one that involves securing available federal funds-- may be necessary.

The future of the Alice Griffith Homes is likely to be tied up with a city subsidy for the Lennar Corp to build market-rate condos on that site. Given Lennar’s track record of broken promises to the community, how it gained control of the project without a competitive bidding process is a mystery.

Of course, none of the Mayor’s moves addresses the fundamental problem: the SFHA is currently dysfunctional. That’s why Superior Court Judge Kevin McCarthy appointed Art Agnos to act as receiver for the agency, but the Newsom Administration has spent tens of thousands of dollars in legal appeals of McCarthy’s ruling.

Agnos is widely viewed as someone who could have quickly gotten the SFHA back in order, which makes Newsom’s opposition to his appointment smack of politics (Agnos backed Gonzales against Newsom in 2003).

Former Housing Authority Commission President Barbara Meskunas sees Newsom’s battle against Agnos as demonstrating “that the SFHA is a disaster, but the Newsom Administration does not want to acknowledge it. Newsom wants to divert attention from the radical changes necessary at the SFHA, reforms that Art Agnos would initiate.”

The Board of Supervisors has shown such concern over SFHA’s performance that it allocated the $5 million in public housing repairs to the Mayor’s Office of Housing, rather than to the SFHA. There is a consensus at City Hall (outside of the Mayor’s Office) that the current SFHA leadership cannot be trusted to wisely spend public money.

Whereas the San Francisco Chronicle has created political problems for prior mayors over problems at the SFHA, it has given Mayor Newsom a free ride. The paper has not run the large photos of decrepit living conditions, with pull-quotes from tenants blaming the Mayor for their problems---as they routinely did for other mayors.

Reading the Chronicle, one would not realize that the Newsom Administration has refused to seek federal funds, or that it is spending public money in a fight to keep a Housing Authority chief in power who has not paid the Agency’s debts and has left it an object of national ridicule.

At his Friday news conference, Mayor Newsom stated that “I challenge anyone to identify a more pressing need for the City and County of San Francisco” than the making of “immediate and lasting change for the City’s public housing residents.”

The Mayor is correct. But this same statement could have been made at least two years ago, and does not explain Newsom’s continued support for SFHA chief Greg Fortner.

As I wrote back on March 13, tenants in public housing will continue to suffer from poor management until the Board of Supervisors abolishes the Housing Authority Commission and replaces it with itself. This would represent the real “immediate and lasting change” that the Mayor supports and public housing residents deserve.

Send feedback to rshaw@beyondchron.org