San Francisco's housing bonds not much to build on 

At last week’s Board of Supervisors meeting, Supervisor John Avalos (who is running for mayor) announced he is requesting that the city attorney draft a housing bond measure that would fund “affordable housing development,” “transit-oriented development” and “upgrades to single-family homes including seismic safety retrofits, green energy production and energy efficiency measures, and bringing buildings up to code.” In addition, the bond would provide down-payment assistance for first-time homebuyers and “silent loans for homeowners at-risk of default and foreclosure.”

General obligation bonds are debt issued (like a big credit card) and repaid with property taxes. Issuing such bonds requires voter approval, so you can relax and know that the circumcision ban has a better chance of passing than a housing bond. Did I mention Avalos is running for mayor?

In 1996, voters approved $100 million in general obligation bonds for the purpose of building low-income housing and offering “down-payment assistance to low- and moderate-income first-time home buyers.”

Then-Mayor Willie Brown promised that the bonds would “build 3,000 new apartments and offer home ownership to 1,000 families.” 

A few years later, in 2002, Brown and the Board of Supervisors came back to the voters to request $250 million in general-obligation bonds to fund similar housing goals. Opponents pointed out that the 1996 bond money had not resulted in promised improvements. By June 2002, only 232 new homes had been built, 104 were in the process of being constructed and 1,006 were still in the planning stages, for a total of 1,342 — far short of the 3,000 new units promised.

And instead of “home ownership to 1,000 families,” only 215 loans had been made to first-time home buyers.

The administration claimed that unforeseeable market forces had driven up the cost of new construction, but voters were unsympathetic and the 2002 proposal failed. In 2004, then-Mayor Gavin Newsom and the Board of Supervisors tried to get voter approval for $200 million in general obligation bonds for the same affordable housing goals but it also failed.

Enacting any proposal for general obligation bonds requires a two-thirds vote, which is a high hurdle. But measures to set aside money from the general fund for affordable housing only require a majority vote. The two attempts at housing set-asides failed in 1990 and 2008.

There’s nothing wrong with making affordable housing a priority for discussion among mayoral candidates, but history shows that a housing bond — even one to fund “green energy production” — will likely be a waste of paper.

Subway money vanishes into more than one hole

The Central Subway — the $1.6 billion project that’s supposed to extend Muni’s Third Street light rail under SoMa, Market Street, Union Square and Chinatown — is having a rough month.

Not only is the project behind schedule, but the recent $8 million grant to the Chinatown Community Development Center to build housing for persons displaced by the subway has been criticized as payola because the center has been a vocal local supporter of the project.

We can add another item to the list of subway headaches: a damaging audit of the billing practices of the two main project contractors. Conducted by the accounting firm of Moss Adams LLP and released on May 5, the report shows sloppy and nonexistent record keeping practices and notes that, while the contractors have promised to shape up, there have been no moves toward repayment of inappropriate charges to the project.

According to the report, the San Francisco Municipal Transportation Agency contracted with the “Central Subway Partners” to “provide program management and construction management” services for the project. The Central Subway Partners is a joint venture between AECOM USA, Inc. and EPC Consultants, Inc.

AECOM and EPC were each called out in the audit for being unable to substantiate billing tens of thousands in overhead costs (things like rent, human resources and technical support) for workers who are stationed in offices provided by the SFMTA.

Also, while EPC charged $33,312 in travel expenses for eight trips, there was no documentation at all for five of them. For the remaining three, supporting information showed that the travelers flew first class, a serious no-no.

Both AECOM and EPC have agreed to make changes to their billing systems and protocols. But, as the report points out, neither company has stepped up to repay the inappropriate and/or unsubstantiated charges. We can only hope these folks are as good at digging subways as they are at digging into subway funds.

Technology office nabs money, more time to make up excuses

About a month ago, I wrote about a Budget and Finance Committee meeting in which the Committee on Information Technology had the temerity to ask for $6.4 million — the amount it was supposed to have saved by finding efficiencies, coordinating services and generally dealing with the embarrassing state of technology in our city government. The technology committee embarked on a plan that includes the construction of a new data center at a cost of $6 million.

Supervisors Jane Kim and David Chiu each had some terse words for the technology committee and refused to release half of the money.

In a presentation last Wednesday that clearly put the “power” in PowerPoint, director of the technology committee, Jon Walton, regaled budget committee members with slide after slide listing all the incredible money-saving ideas that the technology committee is “talking about.”

Apparently, that was enough to warrant the release of the other half of the money — $3.2 million. The Department of Technology now has to appear every six months to give the budget committee fresh new excuses for the abject failure to coordinate information technology at City Hall.

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Melissa Griffin

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