Mayor’s report: Year one

In an interview with SN&R’s publisher, Darrel Steinberg says 2017 created a foundation for big, ambitious initiatives.

N&R President and CEO Jeff vonKaenel, left, with Mayor Darrell Steinberg last year.

N&R President and CEO Jeff vonKaenel, left, with Mayor Darrell Steinberg last year.

Photo by Lisa Baetz

One year ago, as he was about to begin his first term as mayor, Darrell Steinberg sat down with Jeff vonKaenel to talk about his plans. The two sat down again 12 months later, as Sacramento continues to face growing big-city problems while Steinberg pursues ambitious proposals with limited resources. Below is an edited transcript of their conversation.

Your thoughts on the first year?

It was the beginning of fulfilling a very aggressive agenda, and not the end by any means. I think I said a year ago, [and] I say often: I am very driven towards results. What I call ’product.’ You can have a lot of opinion and ideology and political philosophy, and that is all good and important, but it is what you actually get done. To me, what we have done this year is taken my campaign promises and why I think people elected me and we have begun to do what I said I would do.

If you were going to pick three or four major accomplishments, what would they be?

Well, homelessness, No. 1, right? Now, the change is not yet visible—that’s why I call it a foundation. But I have resisted a lot of the important but distracting issues around homelessness. Whether it is the camping ordinance, whether it is the constant back and forth with some of the advocates that come to the City Council. Whether it is, you know, a lot of the political push and pull.

I ran saying I would commit myself to building capacity on all of the elements of what it will actually take to reduce homelessness over the medium to long term in Sacramento: assertive outreach, case management, emergency shelter triage, permanent housing, and mental health and substance abuse resources. And on all five we have made a demonstrable investment and improvement. And none of it was easy.

We’re the only city in the state, aside from the city and county of San Francisco, to apply for and get the federal Medicaid grant known as Whole Person Care—$64 million over three years for assertive outreach and case management. Emergency shelter and triage: We didn’t wait for other jurisdictions, we aggressively went out and opened a triage shelter that will get to 200 [capacity] before long. Not a traditional shelter—it is focused on not only getting people out of the elements but also assessing them, hopefully quickly referring them to long-term services. And on mental health and substance abuse, you saw our conversation at the county where it came down to my signature legislative accomplishment. And we were able to form a partnership where they are contributing $44 million; together with our Whole Person Care, it’s $108 million.

And then on permanent housing, together we banked almost 2,000 units of discreet housing opportunities for permanent housing. All great beginnings.

When I think back to where we were last year at the same time, what it certainly feels to me is that the number of homeless has actually gone up—significantly.

All I could really do in year one was fight to put the investments in place to begin changing the arc of the problem. If you don’t take the elements and put real money behind them and then begin implementing them aggressively, you’re never going to get started.

So how much of the homeless problem goes back to not building enough homes overall? We have a million people living in the region; to meet housing demand, we need to build about 15,000 units per year, and we’re building 5,000 units.

The housing issue in the larger context is a serious challenge to our goals and aspirations in this city. We cannot have a city that is cosmopolitan and exciting—and only for some. I am absolutely committed to that. That is my politics—and it’s a larger issue than Sacramento, as you know.

Do you see a light at the end of the tunnel, where we get to 15,000 units?

Sure I do. And I think it’s going to take some time. And I think we are going to have to be creative along the way. The state of California followed through with something I had actually started as [senate president] pro tem. You know, I got the permanent source bill through the state senate with a two-thirds vote.

We’re going to have to at some point, whether it is 2018 or 2020, put forward a systemic and long-term funding source to match what the state is doing, because the state effort, while greatly appreciated, in part because of the compromises across the street, is not enough money.

We also have to be creative around making it easier and faster for affordable housing projects to get built. We just added 24 new staff to the planning department so we can expedite permitting. I keep going back to the Nicki Mohana project on 19th and J. We have to make it easier to build smaller units.

If we have to build 15,000 units per year for the region—so that’s 150,000 units for the decade—what number do you think we can do in the city of Sacramento?

I don’t want to commit to a number at this point that isn’t matched with an ability to deliver. But there is no question, if 2017, on the homeless front, was the year of showing a pathway to getting 2,000 people off the street, then 2018 and 2019 are going to be the years that we really focus on housing.

It can’t just be the public sector; it has to be the private sector.

It seems, when we were talking about this a year ago, what made me excited was your focused approach. And now, a year later I’m thinking—it’s a tidal wave coming. And we’re seeing many people, if the rents hadn’t gone up, if there was housing, they wouldn’t be homeless today.

It’s the conundrum, frankly. If you want to get right to the heart of another issue, it’s the conundrum around rent control. Where in the short run, putting a hard cap on rent would be tempting, and actually understandable because it would provide people real relief. But will such a policy make it harder to dramatically increase the supply that is so desperately needed?

OK: The second priority you mentioned last year was economic development.

I think we are off to a very strong start there as well. We just signed an employment incentive agreement with a Fortune 500 company, Centene, that will guarantee 5,000 jobs in the city of Sacramento—if they choose Sacramento. They haven’t done so yet, but their signing of the employee incentive agreement is a good sign that we’re on our way.

We will subsidize up to 1,500 jobs, but they can’t be jobs that are transferred from Rancho Cordova [where Centene currently has offices], and they have to establish a campus or a set up a site in the city of Sacramento. So they could transfer some, but at least 1,500 have to be new jobs.

We are confident, based upon their growth, their strength as a company and what is happening in California with the Affordable Care Act and health care that they are going to remain in Rancho Cordova and build the [new] campus.

[The jobs] have to be 125 percent above the average [wage] and 120 percent above the median.

As opposed to the Amazon warehouse jobs?

Right. The hard part of the negotiation was our insistence on setting a wage standard. That was important in terms of the kind of jobs we subsidize. We will pay the subsidy over the course of the years through our city’s innovation fund, but we can always replenish the innovation fund by capturing the increased land value from where they develop. So we want the innovation fund to be a recurring source of ability to attract more high-wage employers.

The other thing we talked about last year was youth and developing different options for them—so tell me a little about that.

Yes: We launched Thousand Strong. By the end of the year, we will have placed between 400 and 500 kids in a year-round permanent workforce experience. In fact, on Friday [December 15], we [held] a press conference announcing a collaboration with the school district—they are going to place about 80 kids in nonprofit jobs, and together we are going to subsidize the wages to get us to between 400-500 kids in total. So we’re off to a really good start.

In terms of challenges, unexpected challenges?

It’s always harder to push through to the finish line on any initiative. Homelessness is a great example. The fact that we have put together $108 million is great, but people want to actually see demonstrable difference on the streets. And so I think the challenges are still trying to change the city culture, especially on economic development and growth.

This idea, which I think is now more embedded in the city consciousness, that we want to be more than a government town. That we can’t rely on the ups and downs of the state budget in order to secure opportunity for our people, especially kids from our neighborhoods. I think that mindset is growing. But structurally, we still have a small economic development department, we still don’t have a neighborhood-based economic development strategy to speak of. I would say our No. 1 challenge in this city is that we lack the capacity, both on the private side and public side, to do more than one big thing at a time.

The things you are talking about are all regional problems. From the outside, you have the biggest ideas. But you also have the smallest budget. The city’s budget is $1 billion; the county’s is $4 billion.

Right; that’s part of the frustration with the pace of change. The county chapter [of the homelessness initiative] was a difficult one. And I don’t think I am that popular in some circles over there. But it took a little bit of provocation to try to create an actual partnership. If you’re not ruffling a few feathers, you are probably not trying hard enough.

I have done this work long enough to know that it takes a common mission towards implementing all of the elements. And the other thing is: There has been this pervasive sense in this community for a long time that the issues are too hard, and the best you can really do is manage it. And when I said, you know maybe it’s not the brightest political move in the world, but we need to commit to getting 2,000 people off the street in the next three years—and I will hold myself accountable for that number—and that’s kind of unheard of in Sacramento.

We all love to cut the ribbon. But as we’ve managed it, the problem has grown worse, and we’re trying to change that.

We’ll get to the goal, but there will be more than 2,000 more, newly-homeless people by the time we get there.

That why I said that in 2018 and 2019 we need to focus on the housing crisis as well. The city of Chicago experimented with giving $1,000 vouchers to low-income people who [were confronted with] an unanticipated expense—car breaks down, medical expense, loss of a job, increased rent. And what they demonstrated over time was that, that small investment [averted disasters]. I have asked our Whole Person Care team to look at that. Yes! It can’t just all be about complicated public policy. It needs to be about simple commonsense ways to help people who are in crisis.

Obviously, there is tension between the Police Department and the community. When the tape came out showing [Sacramento police Officer] Anthony Figueroa involved in a brutal beating in Del Paso, you came on the air and said, “This is intolerable.” And now he is back on the job.

Yeah, that’s what I said. I have expressed my frustration with state law that does not allow the city to be able to explain or even to report anything about what happened and why, and that remains my frustration. I think in the big picture, the relationship between the Police Department and the community, though far from perfect, has improved dramatically since I started a year ago.

I think there are a couple of things. I think, No. 1, you have a police chief who is better than anyone could have ever imagined at negotiating that very fine line between being responsive to the community and standing up for the men and women he leads. He has got a very deft touch, and people trust him. And because they trust him, they are willing to give him the time to continue improving these relationships.

Just like homelessness, it’s not like we can say, “Ah, its all good, the work is done.” These issues are national in scope. These issues of race beyond policing remain, so the work needs to continue. Implicit bias and all of the other ways to build a different consciousness—not just in our Police Department but beyond where it needs to continue.

So people saw the video—and nothing happened. Just like the story we ran [December 14, about former Officer John Tennis], no charges were filed.

There was an investigation. And my frustration is that, as the mayor who has to rightfully answer these questions, we are not able to know what went into these decisions. And that’s a state law problem. There needs to be a balance in protecting the privacy and rights [of accused officers] and the public’s right to know about what happened in their community.

When I look at the revenue projections of where we’re going—it appears catastrophic. My major takeaway is that we’ve got this gigantic hole because of the pensions and the CalPERS changes. And that, potentially, marijuana tax money can fill that hole so we don’t have to cut social services.

There’s some hope in two areas. One is appropriate regulation and taxation of marijuana. We are far ahead of other cities when it comes to getting out there and, you know, its not perfect—but we believe that we can appropriately regulate, address and eliminate some of the underground market and tax the cultivation and manufacturing, and the sale and the delivery of recreational marijuana. There is going to be significant revenue. The second thing is, again, you know my political views and values, but in this seat—grow that economy, do everything we can to grow our tax base, and: more jobs.

And if we grow the economy, we may be able to expand services.

So, have you gotten into the weeds enough about the Trump tax bill, what the impacts will be on the city?

I have. I can’t tell you exactly what the impact will be on the city, but it’s not good for California, period. One of the things that’s interesting about it: Much of it sunsets in 2025, including tax cuts for middle-income people. So when we have a new administration, which I hope will happen on January 20, 2021, there will be plenty of time to reverse some of the worst effects of it.

So then, one of the things we talked about last year was changing the staffing of the Fire Department like other cities have. Because, when I’m looking at the budget for departments that have enough dollars …

Well, we talked to the union about it—they don’t like it. What I said was, look, as we approach the longer-term contract, we should discuss all of these things. Let’s discuss them in a transparent way, and let’s have the discussion in public. Because they make the case that you don’t save nearly as much money as the city management has said. Some of them feel that three on an engine or four on an engine are potential public safety risks.

And what is the city staff saying the savings will be?

Well, I haven’t looked at it in a little while, but it’s in the millions of dollars.

Let’s talk about immigration.

There are so many issues in politics that are shades of gray. This is not a shade of gray for me. Civil rights is civil rights is civil rights, and immigration is a civil rights issue.

I also have strong opinions on how you deal with a bully. You cower, they’ll take more. You stand up, you’ll have a better chance. I said it many times and in many ways: In our city, we’re never going to trade civil rights for money. I said it to the director of ICE, and [Sheriff] Scott Jones. The people in our community and the immigrants in our community know that we are never going to compromise their rights.

Another thing I want to talk about is arts. You know there’s an arts renaissance going on. Art Hotel, ArtStreet, the mural festival. All of this, the creative economy grants. We have $7 million of grant applications, [and] we have $500,000. Another capacity issue. We need more capacity to foster more arts and arts education. That’s going to be a very big initiative for me working with schools next year.

We want to build a modern city, and arts need to be as much a priority as sports.