Exclusive: How a deal to build Sacramento’s largest downtown homeless shelter fell apart
In a secret meeting earlier this year, Sacramento County officials killed a long-planned proposal to create a shelter that would have housed hundreds of homeless people downtown.
The county and the city of Sacramento developed the concept together, aiming to buy a vacant building at Third and R streets from the California Public Employees’ Retirement System, according to three people with knowledge of the deal.
The project was never identified on a public meeting agenda, although elected officials hinted at its progress for months.
“This downtown site, which we obviously cannot be public about in terms of its location yet, is a tremendous opportunity,” Mayor Darrell Steinberg said during a March 1 City Council meeting. “It all takes a long time, too long, but I think we are getting there on this particular opportunity.”
The next month, the county backed out of the deal.
Each of the five Sacramento County supervisors did not return calls for comment for this story. Public officials signed a non-disclosure agreement about the deal that expires at the end of October, city spokesman Tim Swanson said.
County spokeswoman Janna Haynes confirmed the county chose not to move forward with the proposal at a closed-session meeting of the Board of Supervisors in late April. She did not disclose whether elected supervisors chose to end the agreement or county staff put a stop to negotiations.
The county backed out of the project because it would have been too expensive, Haynes said earlier this summer.
“The county’s share on this site was approximately $50 million — just for the real estate purchase and rehab of the facility for this use,” Haynes said in an email in June. “Preliminary estimates indicated the site would accommodate up to 300 beds. The County has multiple sheltering projects under consideration at a lower cost that will serve greater numbers of people over the long term. We have given you all the details we can share.”
The city would have spent $3.3 million a year on operating the downtown site, Public Works Director Ryan Moore said during a March council meeting.
The county abandoning the downtown proposal preceded a four-month period in which city and county elected leaders hardly spoke to each other about homelessness, Sacramento’s most pressing crisis.
About 1,000 homeless individuals live in downtown or midtown, said Arturo Baiocchi, a Sacramento State researcher in charge of a federally-mandated homeless count.
“This was was something we worked on for months,” City Councilwoman Katie Valenzuela, who represents downtown, said during a council meeting last month. “We did site visits ... we had funding plans developed, we were working on strategy.”
The distrust showed earlier this month when the City Council revised a November ballot measure that would require Sacramento to provide up to 600 more shelter beds in such a way that it now would only take effect if the county agrees to fund services at the sites.
Disappointed Sacramento shelter fell apart
Prior to the county backing out of the site, several council members were meeting with supervisors regularly. After the county pulled out of the deal in April, those meetings stopped. They did not resume until earlier this month, with different members, hours before the council voted to amend its homeless ballot measure to link it to county action.
The city currently spends more than $33 million a year to operate 1,100 shelter beds and spaces. The county, which has a budget six times greater than the city, funds 1,400 indoor shelter beds. There are an estimated 9,300 homeless individuals in Sacramento County on any given night, a recent count found — nearly double the amount from January 2019 and more than San Francisco.
People who knew about the deal were surprised and disappointed when they learned it fell apart.
“We thought it was going to be this moment,” said Emily Baime Michaels, executive director of the Midtown Association. “It would’ve been such a game changer for this area. It probably would’ve been stood up by now.”
New talks for a downtown shelter
The county made the decision during a closed session discussion at the supervisor’s April 27 meeting. The County Counsel’s office through Haynes said the county complied with state law in how it described the item on an agenda for the meeting.
The supervisors’ agenda for that date lists one case under potential litigation, a demand letter sent by the American River Parkway Foundation regarding encampments on the parkway. The agenda did not include information about the site at Third and R streets.
That description could represent a violation of the Brown Act, the law that protects the public’s right to participate in government meetings.
“You can’t put an apple on the agenda and talk about oranges,” said David Loy, legal director at the First Amendment Coalition. “The Brown Act entitles the public to know it’ll be on the agenda and have the opportunity to listen to board members’ views and have the opportunity to have public comment. That is the very purpose of the Brown Act. You cannot make fundamental policy decisions in secret.”
This month, city and county leaders say they’re having more productive discussions about homelessness. Steinberg said he’s hopeful relations with the county will improve. He said the city still wants to do a large “campus style” homeless shelter, and that the downtown building is still on the table.
“We have a chance for a do over here,” Steinberg said. “I think everything is still on the table.”
This story was originally published August 22, 2022 at 5:25 AM.
