Council cool to pitch for new city agency

Mayor Kirk Caldwell’s plans to create a new housing development and management division got a lukewarm reception from members of the City Council Budget Committee on Wednesday.

The Caldwell administration views the proposed Asset Development and Management Division, and its staff of eight new civil service employees, as critical to the goal of creating more housing for the homeless and others in the low-income strata.

The eight full-time positions would cost taxpayers $477,000 including wages and benefits, and be housed within the Department of Community Services. Half of the division would deal with property acquisition and management while the other half would focus on management of properties, Community Services Director Gary Nakata said.

Caldwell officials have acknowledged that the functions of those in the proposed division are similar to those of the Office of Strategic Development, for which they sought $616,000 for seven positions only a year ago and were rejected by the Council. The administration ended up scrounging for funding in its existing budget to fund three of the positions this year.

But Nakata said the three positions are not enough if the city wants to ease Oahu’s affordable housing crisis.

Councilman Trevor Ozawa said the new division would duplicate functions now performed by other agencies in the city. “As it currently is laid out, I can’t support that,” he said.

Attorneys from the Department of Corporation Counsel help negotiate the purchase of assets, the Purchasing Division puts out requests for proposals and nonprofits “can go out there and manage the properties themselves,” Ozawa said.

“It works in other cities … so I don’t see why we’re trying to buck the trend here and come up with a massive management division as if we’re some big real estate company that’s in the business of real estate management, property management … ,” Ozawa said.

Nakata said that while city lawyers and Purchasing Division employees do some of the work, more expertise is needed to conduct groundwork. And while “I have a lot of faith in nonprofit housing developers,” he said, “right now we don’t have the people to even monitor what these outside people would do.”

The administration is not suggesting a return to a 100-employee housing department that the city had until the early 2000s, Nakata said. “We leverage the power of two or three individuals in one area to handle multiple projects,” he said.

The budget separately calls for $1.38 million for property management services to oversee six properties to be used for affordable and transitional housing. Those property managers would, in turn, answer to the new division, Nakata said.

To help explain how the new division would function, Nakata said his staff will provide Budget Committee members with a hypothetical situation that would spell things out and include a flow chart.

Council Budget Chairwoman Ann Kobayashi said she continues to get mixed signals from the administration. Caldwell initially told the Council that the city should get out of the housing business, but now is going in the opposite direction.

“Your department will be in charge of adding assets to the city rather than getting out of the housing business,” Kobayashi said. “It’s not clear in my mind.”

Nakata disagreed with that assessment. “I wouldn’t say we’re trying to be in the housing — we are trying to provide more affordable housing and to spend down the ($64 million in affordable housing) appropriations this Council provided to us the last two years.”