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Committee recommends $35.6 million Whitcomb hotel amendment to continue sheltering program
Summary
The committee voted to send a resolution approving a third amendment to the city's hotel agreement for 459 rooms at the Whitcomb Hotel, increasing the not-to-exceed amount by $25,618,542 to $35,608,542 and extending the potential term through mid-2021; the Budget and Legislative Analyst recommended approval with a six-week report-back requirement.
The Government Audit and Oversight Committee recommended that the Board of Supervisors approve a third amendment to the city's emergency hotel agreement to continue leasing 459 rooms at the Whitcomb (1231 Market Street) for alternative housing and COVID isolation services.
Andrico Penek, the city's Director of Real Estate, told the committee the Whitcomb contract controls all 459 rooms at a $99 per-night rate and that the third amendment would extend site control through June 30, 2021, while allowing the city to terminate with 60 days' notice. Penek said administrative changes had been made earlier to ensure FEMA reimbursement eligibility and to increase the contract to just below the $10 million charter threshold so the third amendment could be brought to the Board for approval.
Human Services Agency Director Trent Rohrer said, as of a recent pull of numbers, 391 of the 459 units were occupied with 417 guests; some rooms are held offline for staff, cleaning or repairs (30 rooms for staff, 20 buffer rooms, 16 for cleaning, 10 for repair). Rohrer characterized turnover as modest — on the order of 3–5 percent — and described ongoing efforts to shift from disaster-service workers to community-based organization staff for site monitoring and services.
Fred Brusseau of the Budget and Legislative Analyst's office summarized the BLA report: the amendment retroactively extends the agreement from 122 nights to 449 nights (an increase of 327 nights), maintains fixed room and contingency fees (a 15% contingency), and raises the not-to-exceed cost by $25,618,542 to $35,608,542. The BLA noted FY 2019–20 alternative housing program costs of about $51.9 million and said HSA expects most of the Whitcomb costs to be covered by federal and state sources, including FEMA reimbursements, CARES Act funds and likely state funding. BLA recommended approving the amendment but asked HSA to report back in six weeks on utilization and progress securing additional units.
Supervisor Matt Haney asked about transition plans; Rohrer said the city's winding-down of shelter-in-place hotels would begin around November and would be led by the Department of Homelessness and Supportive Housing using mayoral budgeted resources to avoid discharging housed individuals to the street. Rohrer also said HSA continues to sign short-term leases to achieve budgeted room counts across multiple hotels.
After confirming there were no public callers for the item, the committee voted to forward the third amendment to the Board as a committee report with a positive recommendation. The clerk recorded unanimous committee support.
