Assembly rejects further spending on East Anchorage homeless shelter

The Anchorage Assembly late Tuesday rejected Mayor Dave Bronson’s plan to continue funding construction of a controversial homeless shelter and navigation center off East Tudor Road.

In a 9-3 vote, members rejected the administration’s request for $4.9 million so the city could proceed with the project. Assembly members Randy Sulte, Jamie Allard and Kevin Cross voted to approve it.

That leaves the project, already partially constructed, essentially dead.

The vote came weeks after the revelation that, against city code, Bronson officials authorized millions in construction work over the summer without first getting the required Assembly approval to increase the contract with Roger Hickel Contracting by the $4.9 million. Work had begun weeks before Bronson officials in early September sent a request to the Assembly to change the contract.

Members then postponed consideration of the contract amendment until Tuesday’s meeting and the city stopped all work on the project. Bronson officials later conceded the error.

By then, Roger Hickel Contracting and its subcontractors had done more than $3 million in work, including much of the utility and rebar installation, though work was stopped before the foundation was laid.

In a series of votes over the last year, the Assembly set aside a total of $9 million for the project, but members expected to review the contract before the project proceeded.

Airing a gamut of issues

A lengthy and at times acrid debate among Assembly members and Bronson officials preceded the vote Tuesday night, and some volleyed blame back and forth over the city’s recent homelessness issues, its lack of long-term, low-barrier shelter space and emergency winter shelter options.

Members who voted down the project aired numerous concerns and serious doubts and continued to press the administration for detailed plans on funding and operations.

“We’ve not received a project document — a project plan, cost estimates, detailed budgets, permitting status, public outreach plan, operating plan,” Assembly Chair Suzanne LaFrance said. “We’ve not received any cohesive information. Best practices would dictate that, and what frustrates me about this is that this was an opportunity to demonstrate best practice. It was an opportunity to build more support for this project and I really feel like it has been squandered. And our community needs this. That’s what is so frustrating about this whole experience. We need emergency shelter and navigation services, but I can’t support moving forward with this project as it has been placed before us.”

Several Assembly members, including LaFrance, indicated they would be open to continuing the project in the future if the administration addresses their concerns.

In a statement on Wednesday, Bronson attacked the Assembly for killing the project, saying, “The Assembly deceived us all.”

The Assembly “has wasted 15 months of progress that included thousands of hours of negotiations, numerous public meetings, and efforts made by my Administration to address their concerns and answer their questions,” Bronson said in the statement. “We now have a construction site that will need further work to make it useful, all at taxpayer expense.”

During Tuesday’s meeting, Bronson, his officials and members supportive of the project pushed back on assertions that key details and plans are lacking and voiced frustration over its disintegration after millions had been spent or set aside for it by the Assembly.

“The municipality and the contractor have both been operating in good faith based on no less than three Assembly actions that appropriated to the tune of $9 million towards this project,” Municipal Manager Amy Demboski said. “It was our intent — we thought we were collaboratively working with the Assembly.”

Demboski said she expects the contractor will take legal action to recoup costs.

“We’ve already received two demand letters from Roger Hickel construction, meaning litigation is inevitable ... if it’s not approved,” she said before the vote.

Broadly, Assembly members have indicated they agree that Roger Hickel Contracting should be paid for its work. Members on Tuesday asked the administration to provide more detailed information about the contract and invoices before signing off on payment.

A motion from Sulte to approve a contract change of $3.5 million failed. Demboski estimated the city will need to pay the contractor about that amount.

Roger Hickel Contracting was at the center of a similar city dispute in 2013, when the city’s former power company allowed the company to do nearly $5 million in work without Assembly approval.

The city has already spent $2 million on the tensioned-fabric structure for the facility from Sprung Structures, which Roger Hickel Contracting had purchased for the city and which ended up costing about $2.4 million.

In total, more than $6.5 million has been sunk into the project, according to information provided by the administration.

The city is also incurring thousands in monthly costs to store the structure out of state and for construction materials already acquired by the contractor, according to the administration.

“We could have taken that $5-plus million and put it into a pile and lit it on fire and at least the homeless people would have been warm from the money,” Assembly member Cross said.

It’s not clear exactly what the city will do with the project site, which sits between an Anchorage Police Department building and the department’s evidence vehicle lot, near Tudor and Elmore roads. It’s also not clear what will be done with the $2.3 million structure, which has been “purpose-built” for the site, according to the administration.

That building has not yet passed the city’s own inspections of its architecture and structural design, necessary for the project to get a commercial building permit — and reviews it must pass to ensure the building is safe and meets the city’s code.

The city’s website shows that its structural engineers have flagged several issues with the building’s seismic design and wind load, which have not been resolved.

“How are we able to proceed with this project when it looks like we don’t have sign off on seismic, on the wind test, that there are still questions about the scale used for the facility and lots of others, and they weren’t resolved anywhere between Oct. 14 and Oct. 22?” Assembly member Meg Zaletel said.

In response, Lance Wilber, director of Economic and Community Development, said the city is working with the contractor to get satisfactory answers on the issues to the city’s reviewers, and that it is complicated by the fact that city code does not have elements that specifically deal with using tensioned-fabric structure for human habitation.

The issues “are not anything that we can’t overcome,” Wilber said.

If the project does eventually move forward, the city would need to find more than $6 million to fully complete the 150-person facility with furnishings and equipment. The estimated cost to finish it has jumped from a previous estimate of around $12 million to more than $15 million.

The city also would need to figure out how to fund its operations, estimated at just under $6 million per year, according to a presentation from Bronson officials to the Assembly last week. The navigation center would offer services targeted toward moving clients into housing and mental health or substance abuse treatment services when needed, administration officials say.

Members have questioned the operations estimate, saying it is likely low. Exact funding sources and a full operations plan are among several pieces that members said they want to see before considering the project again.

“The administration failed to follow the rules for spending this public money,” LaFrance said. “I’m disappointed in this outcome. I ask you all in the administration to make it easy for me to vote ‘yes’ again, as I have voted ‘yes’ before for this project. But the only way I can vote on this responsibly is no.”

Shelter project’s fate linked to former Golden Lion Hotel

When Assembly members set aside $6.2 million for the East Anchorage shelter project in May, they made the money contingent on a firm written commitment and good-faith effort from the mayor to pursue using the city-owned former Golden Lion Hotel as a treatment facility. Many members say he hasn’t met that condition. The administration argues it has given serious consideration to the proposal.

Assembly member Felix Rivera, who chairs the Committee on Housing and Homelessness, said the administration should reaffirm its commitment and pursue the Golden Lion’s use.

Bronson has vocally opposed the city’s purchase of the Golden Lion. His criticisms were a rallying cry for supporters and a big part of his campaign for mayor.

Members are also pushing Bronson to use the former hotel as low-income housing for homeless and at-risk residents in the meantime, an effort spearheaded by Rivera.

On Tuesday, they passed a resolution that directs the administration to review options that would allow conversion of the Golden Lion into housing, in compliance with city code. Members also asked officials to identify any roadblocks the city will need to address, and to provide a written report to the Assembly by Nov. 4.

Bronson blasted that move in a Wednesday statement, saying the Assembly intends “to turn the Golden Lion into a homeless boarding house — something they promised would never happen when the Assembly bought the building.”

Members say using it for low-income leased housing is far different than a homeless shelter.

The resolution follows a measure the Assembly passed earlier this month ordaining that the city is to use the building for housing, which all members except Allard voted in favor of.

Many Assembly members say standing up more low-income and supportive housing is critical.

“Without a place for folks to go, the facility being built at Tudor and Elmore will just be a shelter — and an extremely expensive one,” Assembly member Forrest Dunbar said.

‘A sad and wasteful saga’

Bronson’s Wednesday statement blamed the Assembly for much of the city’s current issues with unsheltered homelessness. Because of the Assembly’s vote, “more of our most vulnerable citizens will go unsheltered this winter,” he said.

The shelter would not have been completed until mid-April at the earliest, if the Assembly had OK’d construction on Tuesday, officials have estimated.

Bronson proposed the project last year, initially as a 450 to 1,000-bed facility — a proposition that most homelessness experts and many residents strongly opposed as far too large, too costly, and detrimental for homeless clients and the surrounding neighborhoods. Cost estimates quickly grew to more than $22 million.

The Assembly quickly shot that version down and members later agreed to a much smaller version. It was one of five parts of an agreed-upon plan to stand down the city’s COVID-19-era emergency mass care operations at Sullivan Arena and non-congregate shelters, and expand longer-term homelessness services in Anchorage.

Tuesday’s vote is “a sad, perhaps, end to a sad and wasteful saga, caused by this mayor and his irresponsible actions,” Dunbar said.

Dunbar pointed to Bronson’s rejection of a $5.4 million deal to purchase the old Alaska Club for a similarly-sized homeless shelter, set up by former Acting Mayor Austin Quinn-Davidson.

Then in June. the Bronson administration closed the city’s former COVID-19 mass homeless shelter inside Sullivan Arena and directed homeless residents to live in Northeast Anchorage’s Centennial Park Campground.

The city moved people back to Sullivan Arena as an emergency winter shelter, after Bronson’s plans for winter proved to not be viable. The Assembly then came up with its own plan, including Sullivan and the Golden Lion.

The city cannot legally clear homeless camps without low-barrier shelter space. Bronson hammered that point during Tuesday’s meeting.

It is the administration’s duty to come up with credible, feasible solutions to move people off the streets and to follow city code, Assembly Vice Chair Chris Constant said.

“So while it’s easy for a member of the administration — in fact the chief executive of this city — to point to the Assembly because he didn’t get his way, because he didn’t follow the code, to say it’s our fault and our job — that is a complete sloughing of the executive’s responsibility,” Constant said.

[Related coverage:]

[Assembly to vote on whether to finish building embattled East Anchorage shelter project]

[Bronson administration approved $4.9 million for construction for East Anchorage homeless shelter without required Assembly approval]

[Already under construction, East Anchorage homeless shelter project is hanging by a thread]

[No place to go: Anchorage’s homeless shelter capacity has been pushed to the brink]

[The Bronson administration held a public meeting on a proposed homeless shelter. Few people knew about it.]

[Assembly approves spending $6.2 million to build East Anchorage homeless navigation center and shelter]

[Anchorage Assembly pushes Bronson administration to open longer-term housing for homeless in former Golden Lion Hotel]