Mayor Todd Gloria's proposed 30-year lease for a 65,000-square-foot commercial building and its potential transformation into a massive homeless shelter and resource campus will have to wait at least another week before receiving approval, with the San Diego City Council instructing its staff to keep negotiating proposed lease terms.
Following hours of presentations, public comment and council discussion, the council voted 7-2 late Monday night to bring the topic back for discussion next week, with Council members Kent Lee and Vivian Moreno in opposition.
While the council said it wants more specifics on proposed lease terms, Gloria said he needs more concrete bargaining points from the council.
"My administration is happy to continue refining the current proposal, but Council members must provide specific negotiating points, which I am immediately requesting from them," he said in a statement released early Tuesday morning. "San Diegans expect bold action on homelessness, which is what Hope @ Vine represents, and we must continue to address this crisis with the urgency and compassion that it demands."
Gloria last week announced the tentative 30-year lease deal for Hope @ Vine at a cost of $1.95 per square foot, with annual 3.5% rent increases and an estimated $12.5 million in facility maintenance costs over the term.
The city's independent budget analyst — an independent office intended to review and publish reports on the mayor's budget moves — urged the council to use caution in considering the deal, lest the city find itself mired in yet another bad real estate deal such as 101 Ash Street.
Taxpayer groups echoed the concerns.
"Delaying and going back to the drawing board is an opportunity for the city of San Diego to show taxpayers it is learning from its past real estate blunders," wrote Haney Hong, president and CEO of the San Diego County Taxpayers Association. "But the fact that we're here nonetheless shows the city has a long way to go to earn taxpayers' trust with their dollars."
If the lease as proposed by Gloria is approved, the city will need to find $29.8 million annually in new revenue — no easy task for a city just one month removed from a budget process featuring stop-gap measures to avoid service cuts.
The mayor made the case that if the deal is accepted, several advantages would kick in, including:
— 19 months of rent waived, $2.4 million in savings;
— $5 million unrestricted contribution from property owner;
— property owner responsible for mitigation of any potential hazards identified during renovation process;
— property is not available for purchase; however, San Diego has first right of refusal should landlord sell the property;
— if property is sold within five years, city would receive profits from sale amounting to 14% of net; and
— deal includes adjacent parcel of land that can serve "multiple uses including for additional shelter and services."
Under the proposal, the city would have authorization to spend up to $18 million to modernize and adapt the existing structure into a "transformative campus," with the ability to create separate shelters for distinct populations including seniors and families.
San Diego County Supervisor Terra Lawson-Remer said Monday the county would support the city's efforts by providing behavioral health services at shelters.
"We know that getting people off the streets and into shelters is just the first step; we also need to provide treatment and resources for people struggling with mental health or addiction issues," she said. "Some unhoused have co-occurring mental health and substance abuse problems that are exacerbated by living on the street. I am committed to working with the county of San Diego Behavioral Health Department to develop a plan with the city to deliver behavioral health services at new city shelters."
Site improvements call for a commercial kitchen, laundry facilities, dining areas, indoor and outdoor recreation areas, showers and restrooms. Proposed onsite services include job training, meals, housing navigation and behavioral health services with annual operating costs anticipated to be $26.4 million.
According to the Regional Task Force on Homelessness' most recent Point in Time Count, roughly 3,000 people remain unsheltered in the city of San Diego.
