Agencies pull together to get residents out of a troubled Homekey project and into homes.

It was an extensive collaboration that enabled Salinas to open the first state-subsidized Homekey project in Monterey County in December 2020, initially housing over 60 people who either had no homes or were on the brink of homelessness. The County of Monterey joined the city and partnered with a host of other agencies and nonprofits in the effort to facilitate the purchase of a hotel by a developer and move residents in. At the time, it was a success story.

Last year, cracks in that story began to emerge, after it became apparent the Homekey developer, Shangri-La Industries, was in trouble. Court cases stacked up for unpaid construction bills followed by the company defaulting on loans, not just for its initial Salinas project at 545 Work St., but also two other Salinas Homekey projects, plus one in King City and others in Southern California. The company is now embroiled in lawsuits, including one that alleges its chief finance officer misused funds. The Work Street property was foreclosed on with a debt of $15.9 million. Dearborn Street Holdings  – Series 1 LLC, based in Indiana, acquired the property on April 26.

With just over 50 people’s homes in jeopardy, it was time for agencies to collaborate again, this time to find new homes so the residents would not fall back into homelessness. The plan is to keep the property as a Homekey project, but it is “in desperate need of repairs,” says Lisa Brinton, Salinas’ community development director. Residents representing 45 households received a 60-day notice to move out by Oct. 16 so that renovations could begin.

Brinton began meeting weekly with Roxanne Wilson, the county’s homeless services director, Zulieka Boykin, executive director/president/CEO of the Housing Authority of the County of Monterey, and representatives from other agencies including the County’s Health and Behavioral Health departments.

“It really truly is all hands on deck,” Wilson says.

At the request of the County, the Coalition of Homeless Services Providers – a federally designated agency known as a Continuum of Care that does the initial screening of potential recipients of vouchers and homeless services using a formula that determines need – paused its system in order to prioritize the “highly acute” Homekey residents. Doing so allowed them to be prioritized for services through agencies and nonprofits within the continuum.

Boykin says residents were eligible for federal emergency housing vouchers. As of Oct. 14, at least 14 families had moved into housing. Others have received vouchers and are on the cusp of securing rentals. Around half of the 45 households are headed directly into permanent housing. Brinton calls the collaboration that made it possible “impressive,” adding, “the number we have going into permanent housing is even more impressive.”

Salinas, Brinton says, is using a California Emergency Solution Housing grant, as well as a grant for rapid rehousing from United Way, to pay for rental application fees, deposits, storage and moving expenses.

For those still waiting for homes, the County amended its contract with service provider Step Up on Second Avenue – the original nonprofit that previously partnered with Shangri-La – to safely shelter the remaining residents as they wait.