cawacko
Well-known member
This is a little different as these are homes for formerly homeless as opposed to opportunities to purchase starter homes. But it speaks to the red tape that adds so much cost to these homes (and works the same for the type of homes you are discussing).
(And since it inevitably gets brought up (not saying by you), no, we're not saying there should be zero regulation on what gets built. But that's almost a strawman argument because making it easier and more cost efficient isn't saying make it a free for all.)
Why is S.F. spending $113,000 per cabin for homeless? Nonprofit says it could build for much less
When the nonprofit Dignity Moves opened 70 homes for the homeless on a vacant lot near San Francisco Civic Center in 2022, unhoused residents who moved into the village praised it as a dignified, caring place to get a second chance. Elected officials celebrated the site, saying they wanted to replicate it throughout the city as a cost-effective, fast and humane solution to getting people off the streets.
By all accounts the project was a success.
Dignity Moves got permits in under three weeks thanks to emergency rules under the 2019 Shelter Crisis Ordinance to quickly erect modular tiny homes. Volunteers and donations of furniture and bedding helped lower costs. The cabins cost about $34,000 to build and were open in a matter of months.
It’s been a year since 33 Gough St. opened, and San Francisco has still not been able to replicate its success.
City officials have spent years talking about opening a similar tiny home village in the Mission on a vacant lot near 16th and Mission streets. But that project is not expected to open until 2024. The per-cabin cost is about $104,000, but when you factor in amenities such as offices and a community room at the project, it rises to a whopping $113,000 per cabin.
The Mission District site is expected to last only a year, prompting the question of whether it makes sense to invest so much in such a short-term project.
The project cost highlights how San Francisco is struggling to scale up solutions to homelessness amid massive red tape and a system that often shuts out nonprofits from creating more nimble, cost-effective solutions to its crisis. Dignity Moves officials told the Chronicle they could build the Mission project much more cheaply.
“Our goal with (33 Gough) was to prove a point and have the city love and do more of them because it was a victory,” said Elizabeth Funk, founder of nonprofit Dignity Moves. “The reality is we could do this at a third of the cost.”
But Funk explained that Dignity Moves could only do the project cheaply if they worked outside of city rules like they had at 33 Gough. The nonprofit could not do it cheaply within the confines of existing city contracting regulations. In fact, its development partner Swinerton bid on the Mission District site, estimating it would cost about $5.3 million to build under city rules.
It lost out to another bidder in early 2023 when the city picked general contractor G&G Builders to build the Mission Street project for $4.3 million, or about $61,000 per unit for construction costs. Those costs rose to $113,000 per unit when the costs of the city managing the project were factored in.
But in trying to manage the construction itself, San Francisco has tacked on “totally unnecessary” costs of more than $2.4 million due to its onerous regulations, Dignity Moves officials said.
“That’s outrageous,” Funk said.
The construction company Swinerton and its nonprofit partner Dignity Moves say they could do the project for just $3 million — about $43,000 per cabin — if construction was directly managed by Dignity Moves and it received donations of labor and goods.
A city analysis shows that Dignity Moves was able to keep costs to $33,000 per unit at 33 Gough St. because about $47,000 worth of labor and goods were donated per cabin.
“I want our city to think about what each entity can do best,” Funk said, adding that despite her criticisms she’s “thrilled” that the city is trying to do more tiny home projects. “If nonprofits are more likely to get donated labor, furniture, pro-bono work, discounts … then it’s a shame to miss out on that.”
But some say Dignity Moves shouldn’t be criticizing the city process and that their complaints are sour grapes because their partner Swinerton lost the bid.
Supervisor Hillary Ronen told the Chronicle that while costs are high, city rules ensure that workers are paid a fair wage and that the work is done according to its regulations. She also criticized Dignity Moves for its framing of the situation.
“I’m frustrated with their position because here you’ve got a losing bidder who did not come with the best bid now complaining about it and criticizing the rules we have in place to protect workers as the reason for that,” Ronen said. “It doesn’t give them much credibility.”
Dignity Moves said in response to Ronen’s quote that they did not bid on the project, though their partner Swinerton did.
Ronen added that these rules “are in place for a reason,” and that making exceptions during a crisis — such as during the pandemic — is worthwhile, but “when we have the time to follow all of the rules, I think that we should.”
Ronen also said Dignity Moves is using “union-busting rhetoric” by suggesting the city use union labor along with volunteer labor. The volunteer labor used at 33 Gough included people in a skills training program.
Emily Cohen, spokesperson from the Homelessness Department, told the Chronicle that “there are significant requirements in our code when the city is involved in a project,” but that there’s nothing stopping firms like Dignity Moves and Swinerton from buying land, putting up cabins and then applying to the city for operating funds, or donating the site to the city.
“That is absolutely a possibility,” Cohen said. “But when the city is the one proposing the project and bringing it forward … we are obligated to follow local building codes, state building codes and all of the regulatory requirements.”
Cohen added that the city is also limited in what it can do compared to nonprofits because of legislation passed in 2022 that prohibits some city employees from soliciting donations from nonprofits, which make volunteer and pro-bono work an ethical gray area.
But San Francisco has long been scrutinized for its regulatory framework that often makes ostensibly cheap projects far more costly and difficult to build.
In 2022, the city came under fire after the price of building a public toilet in Noe Valley increased to more than $1.7 million because of similar requirements. When a donor proposed giving a prefabricated toilet to the city, the Chronicle found the gift would still cost the city $1 million to install.
Since much of the construction of 33 Gough St. was done under the purview of Dignity Moves, it saved money.
Dignity Moves was able to get its permits in San Francisco in under three weeks by taking advantage of a streamlined process to open up more shelter beds, which Funk said was “likely a historic first.” The project used modular fabrication, which can be cheaper, and tapped into state funding for homeless housing.
Since 2020, Dignity Moves has worked to end unsheltered homelessness in communities by building Interim Supportive Housing as a rapid, cost-effective, and thus scalable solution to homelessness. It has successfully completed projects across the state, including in Rohnert Park and Alameda, and also has nearly a dozen other projects in the works, often partnering with charitable organizations, schools and other groups willing to lend their support to end homelessness.
The debate about whether San Francisco should rely more on public-private partnerships to address homelessness came up when the city partnered on a project for the unhoused at 833 Bryant St.
That affordable housing project, which was built by Mercy Housing in collaboration with Tipping Point, the organization run by mayoral candidate and Levi’s heir Daniel Lurie, is an “enlightening case study on why the private sector could do this at half the cost,” said Dignity Moves Co-founder Joanne Price.
Lurie told the Chronicle that for the city to quickly and cost-effectively deal with its twin issues of rampant homelessness and high-cost housing, it should allow nonprofit developers to build under relaxed, streamlined processes.
“Whether it’s a new building or a temporary project like 33 Gough, you have examples, and the private sector is lifting them up on a platter for the city,” Lurie added. “For the city to say we’re going to go a different route and spend triple the cost? That should make every San Franciscans’ blood boil.”
Why is S.F. spending $113,000 per cabin for homeless? Nonprofit says it could build for much less
Critics of the nonprofit say it disparages rules made to protect workers and uses union-busting rhetoric.
www.sfchronicle.com
