LOS ANGELES (CNS) - The City Council Tuesday approved a recommendation to seek the removal of Mark Adams, the receiver appointed to oversee 29 dilapidated buildings in the Skid Row area that house approximately 1,500 low- income tenants.
The council also approved a related recommendation to authorize a $10 million loan to maintain and repair buildings under receivership. Both recommendations were OK'd in a 12-0 vote, with council members Monica Rodriguez and Curren Price absent from Tuesday's meeting, and with no prior discussion.
The council's Budget, Finance and Innovation previously greenlighted both recommendations. Councilman Bob Blumenfield, who chairs the committee, said during Monday's meeting the city had to intervene to ensure the safety of residents within the Skid Row Housing Trust.
"It's a humanitarian crisis that we know at the end of the day falls on our lap as a city -- even though the crisis is not our doing," Blumenfield said Monday. "But we need to be aware of it and we need to step up."
Councilwoman Katy Yaroslavsky, a member of the committee, agreed with Blumenfield, adding "I don't see how we cannot do this."
Housing Department General Manager Ann Sewill and City Attorney Hydee Feldstein Soto explained to the committee why they requested the loan, which is contingent on the appointment of a new receiver, Kevin Singer, who would replace Adams.
"From the perspective of my office and me specifically, this is a difficult ask," Feldstein Soto said Monday. "We would not be here if we weren't persuaded that it's absolutely necessary to preserve the housing and the services for 1,500 of our most vulnerable residents."
The council does not have the authority to fire Adams, who was appointed by a Los Angeles Superior Court judge at the city's request. The council would have to petition Judge Mitchell Beckloff to dismiss Adams and appoint a new receiver.
The buildings are owned in whole or in part by the Skid Row Housing Trust, which collapsed financially earlier this year.
Sewill released a report last week stating that some of the buildings could be irreparably damaged and should be demolished. In addition, the Los Angeles Times reported that many of the tenants suffer from "filth, clogged plumbing, pest infestations and constant intrusions by street people who use drugs, set off fire alarms and sleep in hallways."
Adams has drawn criticism for allegedly failing to make progress on rehabilitating the buildings and finding credit at good rates. Last spring, a firm he hired sent eviction notices to hundreds of tenants who were behind on rent.
Adams, whose appointment did not include the authority to evict tenants, said he did not authorize the notices and retracted them.
Adams told the Times that he would respond to the city's report in court, and cited Beckloff's previously stated support for him.
Feldstein Soto reiterated that with Adams there has been a lack of transparency, including the accounting of "approximately $3.5 million worth of rent" that her office estimates Adams has collected since he was appointed as receiver in April.
"So even as recently as last Friday, the proof is in the pudding. And even despite a court order requiring reporting, we still have not got the kind of report that one would expect from a financial fiduciary like a receiver," Feldstein Soto said.
"...We've lost confidence that this particular receiver can perform," she added.
In response to a question from Blumenfield on how Singer would be different from Adams, Feldstein Soto said that Singer, who is principal and CEO of Receivership Specialists, was vetted by the Housing Department and the City Attorney's Office.
"I've personally communicated with the city attorney for San Francisco, who gave him glowing reviews, and we have to the best of our ability done as diligent job as we can," Feldstein Soto said.
Sewill in her report indicated the loan will be repaid when the properties exit the receivership, either by the limited finance partners or by other housing from the Housing Department and possibly from other government partners.
The $10 million loan is expected to cover receivership costs and repayment of the Adams' expenses, for up to six months. Though there may be additional costs for repairs and other expenses that are not yet known by the city.
Sewill indicated that the goal is to stabilize the trust properties as safe places to live until each property can be transferred to a replacement general partner or owner.
"We need to have confidence that what's going on with these buildings -- with these properties -- would be at the caliber of services that we would come to expect in the situation," Feldstein Soto said.
"And for all those reasons, it's very difficult to come and admit a mistake. But I do think part of our jobs is that if there's a mistake to correct it."
Feldstein Soto said the court is set to consider the city's request for a new receiver on Thursday.
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