Project Homekey, the successor program to the Project Roomkey hotel-homeless-housing effort, is going to cost taxpayers a lot of money, and according to state law, there’s not a thing you can do about it.
The state law is Assembly Bill 83. Signed by Gov. Gavin Newsom on June 30, AB83 was first introduced as a bill that was completely blank except for this sentence: “It is the intent of the Legislature to enact statutory changes relating to the Budget Act of 2019.” It was passed, blank, by the Assembly in April.
In late June, the blank bill was amended into a bill related to homeless housing. In about a week, it was law.
Among its provisions, AB83 says Project Homekey sites receiving funds from the Coronavirus Relief Fund are exempt from local permitting requirements.
The city of Norwalk found out what this means in early September. The Chief Executive Office of the County of Los Angeles sent a letter to the Norwalk officials about the county’s interest in acquiring a 56-room Motel 6 property located at 10646 East Rosecrans Ave. The county’s plan was to use the property as an interim shelter and then convert it to permanent housing by fiscal year 2022-23. The purchase would be made with funds from a state grant, and the property would have a covenant that restricts “the use and Target Population” for 55 years.
Back on April 21, the City Council of Norwalk passed an “urgency ordinance” for the “immediate preservation of the public peace, health, and safety.” The measure temporarily banned the owners and operators of hotels and motels in Norwalk from using or converting their business or property for homeless housing without prior city approval.
So Norwalk demanded more information about the purchase of the Motel 6 property. “Please be advised that the county is providing this information in the interest of facilitating a long-term working relationship with the city on issues related to homelessness and COVID-19,” the county’s letter sniffed, pointing out that L.A. County doesn’t concede the legality of the urgency ordinance.
The county said the motel would serve “persons experiencing homelessness who are impacted by COVID-19.” Services would include “general non-medical support” and “mental health and wellness services.”
The service providers who will staff the proposed facility have not yet been selected, and the cost is unknown. Norwalk asked for a copy of “any house or client rules,” and the county said it would provide the information after a service provider is chosen and under contract.
So a motel that formerly generated tax revenue for the city of Norwalk — about $140,000 in hotel tax and $15,500 in property tax annually — is about to become a financial drain on the taxpayers for 55 years. How will Norwalk replace the missing revenue? The city doesn’t know. Taxpayers can probably guess.
Norwalk asked the county for a planning agency review, but the county cited AB83 and said no local permitting process may stand in the way of using coronavirus relief funds to buy hotels and turn them into homeless housing.
This is happening everywhere in California. In Milpitas, Project Homekey is going to spend $29.2 million to turn an Extended Stay America hotel into 132 units of permanent supportive housing. That’s about $221,000 per unit, not counting salaries and services.
In Long Beach, almost $16.7 million has been given to the city to convert a hotel into 100 units of “interim housing.”
L.A. County was awarded $7.4 million to acquire the motel in Norwalk.
In all these cities, hotel and motel properties that formerly generated tax revenue and brought in visitors who spend money in local restaurants and businesses will now be a drain on the budget. Someone’s going to have to pay for the wraparound services and any public services, such as police or fire department response, that the new clients might require.
Was the costly Project Roomkey a success? Not in Norwalk. According to an internal city memo, of the 206 Project Roomkey clients staying at the Saddleback Hotel, 184 abandoned their room and disappeared.
The only thing that vanished faster was your money.
Originally published in the Los Angeles Daily News