Among efforts to address homelessness is a supportive housing project for adults and seniors in The City’s South of Market Area. (Kevin N. Hume/S.F. Examiner)

Among efforts to address homelessness is a supportive housing project for adults and seniors in The City’s South of Market Area. (Kevin N. Hume/S.F. Examiner)

SF is swimming in cash to fight homelessness: The challenge on how to spend it awaits

San Francisco is swimming in cash to address its homelessness crisis — so much so that advocates have dubbed the rare moment a “golden opportunity.”

Questions remain around where and how some of that money will be allocated. Experts agree that the pool should be divvied up into some combination of permanent housing, mental health services and prevention efforts. Yet given the magnitude of the crisis, it’s clear that policymakers need to think differently.

Voters in 2018 agreed systemic changes were needed with the passage of Prop. C, a gross receipts tax that promised true solutions to homelessness in San Francisco. After a lengthy legal challenge, a plan to spend $1.1 billion may finally be put into practice. Gov. Gavin Newsom’s proposed budget, unveiled last week, also allocates $12 billion to address homelessness across the state.

“We want to be clear that this isn’t business as usual,” said Shanell Williams, who chairs the Our City, Our Home Oversight Committee monitoring Prop. C funds. “We want this to move the needle. If we do the same things, we’re not going to see change. This investment plan is really bigger than just the dollars.”

Under recommendations by the committee, 54 percent of the funds will go to permanent housing, a quarter to mental health services, 14 percent to prevention and 7 percent to shelter and hygiene on top of existing services. The goal is to bring 4,000 people out of homelessness. The City has tapped into the fund since December, now totaling $245 million spent on homelessness.

The investment plan was crafted by department heads, mayoral officials, and shaped by more than a dozen listening sessions with people who had or have experienced homelessness. It incorporates city goals, like ending family homelessness and cutting chronic and youth homelessness in half by December 2022.

Contributors to the listening sessions describe challenging conditions, including sharing small spaces with other families. Maricela Anaya, a survivor of domestic violence and formerly undocumented mother of three, said her shared arrangement was particularly tough. Sometimes her family goes hungry having to wait to use the kitchen.

“It’s been very hard for the children,” Anaya said through a translator from the Homeless Prenatal Program. “I feel like my voice has to count as they make a choice with the funding.”

Under recommendations, 26 percent of permanent housing funds would be reserved for families and 23 percent for youth. Resources would be targeted to rental subsidies and buying, rehabilitating, operating and constructing permanent housing, including 350-450 new units for families. Another $25 million would be reserved for about 300 sheltered and unsheltered families like Anaya’s.

Resources for shelters would be directed to slots at city-sanctioned encampments, nearly 500 beds at navigation centers like one for the transitional age youth and a safe site in Bayview for vehicle dwellers to safely park. A navigation center is recommended for people discharged from jail or impacted by the criminal justice system.

There would also be hotel vouchers for survivors of domestic violence, pregnant people, and drop-in shelters for families.

As for behavioral health, the plan calls for six 24/7 street crisis response teams and another 132 mental health and substance abuse beds. Capacity for intensive case management and urgent care would also be expanded, among other investments.

But whether Prop. C funds will truly go toward overhauling the system in a question in some minds. Jennifer Friedenbach, executive director of the Coalition on Homelessness and OCOH committee member, is hoping to see detailed line items in the budget proposal in order to determine how Prop. C is being allocated elsewhere or on too many administrative expenses.

“The mayor’s office never says when they’re paying for something with Prop. C so we have to dig and find out,” Friedenbach said.

One recent example is around Mayor London Breed’s stated commitment to cap all supportive housing rents at 30 percent, which Friedenbach says is important but wondered if it would be funded using Prop. C rather than existing resources. The mayor’s office confirmed that it would be pulled from the gross receipts measure.

“Yes, this will come from Prop. C funds, as the mayor believes that this program should be funded with a sustainable source of funding to provide stability in future years for Permanent Supportive Housing tenants,” said Andy Lynch, spokesperson for Breed. “In general, the mayor’s budget proposal will largely align with the recommendations from the Our City Our Home committee and we have been working closely with the committee throughout the process.”

The tension around Prop. C goes back to when it was on the ballot. Proponents anticipated it would be challenged legally without reaching a two-thirds majority approval, delaying a life-or-death infusion of resources. Criticism was levied at high-profile officials like Breed, state Sen. Scott Wiener and Assemblymember David Chiu for not endorsing it to bring it over the line.

But how to use these dollars was not drummed up in silos. Members included liaisons to departments to come to agreements along the way, not after the fact. The Department of Homelessness and Supportive Housing also said their recommendations “largely align” with the Our City Our Home committee.

“All the members have been working with the city departments throughout this process,” Williams said. “It’s not like it’s just going to be dropped on them and they’ve never seen it. It won’t be news to them.”

As for the state funds, Newsom’s plan includes $3.5 billion to expand a pandemic-era program to purchase hotels and convert them into permanent supportive housing — another critical piece in long-term solutions. The City has bought the Granada Hotel and Hotel Diva using $78 million using the state’s Project Homekey program, gaining 362 units.

The Coalition on Homelessness and other advocates are pushing The City to be aggressive at this critical time in acquiring hotels. As restrictions are relaxed, coronavirus transmissions dwindle, and tourists come back, hotel owners may drive a harder bargain.

San Francisco’s to-be-determined portion of state funds would build on what Prop. C can bring on hotel acquisitions. The committee recommends spending $123 million on acquiring or rehabilitating 612-712 units, with $21 million in operating expenses for almost 1,000 units over three years.

Breed will unveil her anticipated budget proposal on June 1, which will go through the Board of Supervisors before final approval. Advocates like Anaya hope she and other leaders keep families at the forefront of their minds.

“My hope is that they really think about how to create those units for the families,” she said. “They have a right to have a place they can call their own.”

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The permanent supportive housing project for adults and seniors who are exiting homelessness at 1064 Mission St. in the South of Market Area on Friday, May 21, 2021. (Kevin N. Hume/S.F. Examiner)

The Lower Polk TAY Navigation Center building at Hyde and Post streets on Friday, May 21, 2021. (Kevin N. Hume/S.F. Examiner)

The Lower Polk TAY Navigation Center building at Hyde and Post streets on Friday, May 21, 2021. (Kevin N. Hume/S.F. Examiner)

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