What Next?

So, the big news was no news from the City yesterday, and the real question is...what happens now? How about the Altadena Dream for All is kicked off in a pilot? Time to start the flywheel going.

I like to use an image when thinking about big policy problems. You have to start somewhere. I ask, rhetorically, where is the entry point to the Death Star, thinking of the image from the first Star Wars (yes I am born before 1990)? The image is always in my mind of the X-Wing fighter (Luke Skywalker) going into the maze to do the bombing run. You have to enter at some point to do the goal. Once you find the point, you can point and go.

I think about the next stage of this project as locating the entry point to begin the bombing run to destroy the Death Star.

We have discussed some incredibly complex topics, where no easy answer presents themselves. In fact, I can hear the lawyers (it’s always the lawyers) pointing out the flaws. There are so many points to take on but where is the actual one which makes the most sense, where interest lies, where the issue is pressing enough to garner attention, and meaningful steps can be taken toward the bigger goal? Is there a pilot to start with? Is there something which combines a lot of the characteristics of the overall solution to “pilot” the pieces and see what could work?

Conversations with very intelligent people have yielded this very question, as recently as yesterday. They say, “we hear you and agree in principle, but now we need to go down a level or two.” “Let’s see what things look like when we begin to peel back the onion.” But where? What is substantial enough to allow for us to tackle but simple enough we can do it in a pilot with a mission alignment?

What about housing?

We know for instance, AB 797 is not in place yet, nor is any government ready to do anything today. But, do we need AB 797 to prove out that CRA can be used to fund a nonprofit in a mission-related function? No. We can go ahead with the funds coming in from a bank under CRA and begin the process so long as we have a nonprofit which can track back the use. In fact, going ahead might make it easier for AB 797 to be passed and/or amended to incorporate a broader goal.

What about the use of philanthropic dollars? Can we combine those dollars with a CRA project through a nonprofit? All the talk in philanthropy is “pooling” funds to meet a need, but how? Why not have a program designed through the allocation of dollars to “seed” such an effort, outlining the goals philanthropy would like to see and building those goals into the Program?

How about having a conversation about how we can rebuild maybe 5-10 houses in a different way? Maybe we can contract with a local contractor to accomplish this goal of 5-10 houses and see if there is interest in the community participating in such a model along the lines of California Dream for All? Is there demand for an alternative model which can fund the project to “buy down” the cost and yet “allow” for equity participation? Would the public want such a model?

Another question is can we do it for $500 a square foot for an 1,800 square foot house? Does it have to be modular or could we do more of a traditional approach? Would a builder want to participate for a guaranteed bid of $500 a square foot?

What about issuing mortgages against those properties? Maybe we stand up with initial funders the model to issue a mortgage to those property owners in low to moderate incomes and obtain CRA credits for them? The ultimate property could be FHA compliant if the model works, so we can then issue a conforming mortgage after.

Insurance is harder, but maybe we work with the CalFair Plan to get an initial batch of insurance for this pilot group. We can show the rebuild process can be done. What if we self-insure in the alternative, or a wrap around program to begin the process?

Now, what about the permitting and expedited model? We can go to the County and ask for, in a public way, a pilot to get this model off the ground, providing a framework where nonprofits can lead the pieces through the process for Low and Moderate Income individuals.

So, who is the nonprofit? Does a community group take it on? I can do it under my nonprofit if no one wants it. What about a foundation? Who wants to do it? I would also stipulate there will be minimal administrative expenses to keep costs down and allow for more dollars to be preserved for future use, which will ultimately limit those willing to do this project.

And there you have it folks. We do not need to wait. We can begin to put the pieces in place. Conversations are being had where this Post could be outlining the next conversation. Let’s budget say $10 million to do this initial stage, with probably $5 million up front. Let’s get funders and CRA bankers to come together and put those funds in place to accomplish the pilot. Let’s see what the community says about the Program and whether they would take the option of the Altadena Dream for All. We have nothing to lose and everything to gain at this point.

Here is the entry point to begin to tackle the issues and get the ball rolling. Here is our bombing run on the Death Star. We need to get the flywheel going. Everyone is waiting for the other to say what to do. Well, the tools are here to go. We just need to start putting our hands up and saying yes, I want to do this and here is how I can help.