Karen Francone, Executive Director of the Service League, says the loans will free up funds for treatment and prevention services.
Karen Francone, Executive Director of the Service League, says the loans will free up funds for treatment and prevention services.

Karen Francone, Executive Director of the Service League, says the loans will free up funds for treatment and prevention services.

Originally posted May 10, 2016.

Update: The Board of Supervisors on Oct. 4, 2016, authorized the County to repurpose the award to the Latino Commission to assist with the acquisition of property. Read the staff report.

REDWOOD CITY – The San Mateo County Board of Supervisors today (May 10, 2016) allocated $5 million in emergency loans to nonprofits hit by spiraling real estate and other costs that provide vital treatment to the county’s most vulnerable residents.

Five organizations that provide drug and alcohol treatment will receive loans from approximately $8,275 to more than $2 million. The bulk of the funding will go toward helping with loan or lease payments with approximately $206,000 for immediate building repairs and upgrades.

“It’s just fantastic for us,” said Karen Francone, executive director of the Service League, which provides treatment, counseling, education and other support services for formerly incarcerated and in-custody men, women, pregnant women and women with infants. “Every dollar we can save in principal and interest payments can be used to preserve our existing housing and treatment services and will ultimately lead to future expansion efforts.”

Supervisors last year created an emergency fund after hearing that treatment programs were threatened with eviction or rent spikes. Today’s action puts those funds to work, ensuring 135 treatment beds countywide will continue to be available.

“For the Latino Commission, we have experienced rent hikes in the past three years of approximately 20 percent, and it is continuing to hike up,” said the group’s executive director, Debra Camarillo. Members of the Board of Supervisors said the groups provide vital services. “We all know someone whose life has been touched by drug or alcohol addiction,” said Warren Slocum, President of the Board of Supervisors. “They are competing for scarce space in a very expensive real estate market and they are particularly vulnerable to rent increases and the spiraling cost of providing services.”

Supervisors allocated the funding from Measure A, the half-cent countywide sales tax approved by voters in November 2012. Funding will go to:

  • The Service League: $22,435 for repairs, $968,926 to take over loans on five properties; total of 34 treatment beds.
  • Our Common Ground: $37,525 for repairs; $665,000 to assist a 32-bed recovery program facility.
  • Project Ninety: $131,342 for repairs; $2.4 million to take over loans on six properties; total of 43 treatment beds.
  • Free At Last: $8,275 for repairs; restructure five existing County loans on three properties (no Measure A funds required); total of 17 treatment beds.
  • The Latino Commission: $6,625 for repairs; $735,000 to fund lease payments for 10 years on one nine-bed facility.

Under the terms of the loans, the organizations will pay zero interest and no debt service as long as they continue to provide treatment services, with the loans forgiven in 30 years. The County will work with the Latino Commission to put it in a position to acquire the site of its current program or to find a new property in 10 years.

Since the 1970s Project 90 has operated several residential-based treatment programs for men and women. Jim Stansberry, the executive director, said the County stepping in with financial assistance “frees up money we can put toward treatment.”

The Service League's Francone said nonprofits are squeezed by not only high real estate prices but the costs of doing business on the Peninsula and complying with local, state and federal rules and regulations. With the County assuring loans on five Service League properties, Francone estimates the move will free up more than $7,500 a month in current principal and interest payments, or $90,000 annually that can be used toward the goal of ongoing program stability thus leading to programmatic and housing enhancements.

Camarillo estimated 20 percent of The Latino Commission’s annual budget goes toward rent.

Michael Callagy, San Mateo County’s assistant county manager, said helping nonprofits maintain treatment facilities ultimately saves taxpayer dollars.

“Every individual who receives the treatment they need benefits the entire community,” he said. “If we help these individuals succeed, they no longer will be involved in the criminal justice system, they will not use the emergency room for their health care and they will be productive residents who have jobs, pay taxes and take care of their families.”