A conversation with the Tenderloin Neighborhood Development Corporation on January 9, 2015

Participants

• Donald Falk – Executive Director, Tenderloin Neighborhood Development Corporation (TNDC)
• Lori Linker – Director of Fund Development, TNDC
• Cari Tuna – President, Good Ventures

Note: These notes give an overview of the major points made by Donald Falk.

Summary

Good Ventures spoke with Mr. Falk of TNDC to get an update from the organization, following a grant Good Ventures made to TNDC in June 2014. Conversation topics included an overview of TNDC’s current activities (especially those funded by philanthropy), its recent organizational growth, and its goals for the coming year.

TNDC’s new projects and organizational growth

TNDC started seven new development projects in 2014, including some work on public housing as part of San Francisco Mayor Edwin Lee’s “Public Housing Re-Envisioning Plan.” TNDC has nearly 2,000 housing units in its development pipeline. About half of these are new units, and half are renovations on TNDC’s own buildings or on buildings operated by the San Francisco Housing Authority.

Several factors have led to an increase in local funding for affordable housing recently. In addition, the state of California created two pools of affordable housing subsidy in 2014, and as a result, there is significantly more public funding available for affordable housing projects now than there was five years ago coming out of the Great Recession.

Mr. Falk believes that a ballot measure introduced in May by Supervisor Jane Kim, which called for 30% of new housing to be priced below market rate, has influenced San Francisco’s political dynamics around affordable housing. A 33% rate of affordable housing is now a political “safe harbor” for new development projects that are seeking exceptions from aspects of the Planning Code.

TNDC’s new projects will mean significant organizational growth over the next three years. About a year and a half go, TNDC began to focus on human capital development, which has included the creation of a Chief Talent Officer (CTO) staff position and starting a leadership development program. The CTO’s work will be crucial as TNDC works to grow its staff from 275 to 350-400 people.

Breakdown of TNDC’s annual budget

• $9 million in general support budget. TNDC raises about $2-2.5 million of this philanthropically through fundraising events, corporate philanthropy, foundation grants, and individual donations. Most of the remainder is earned income from property and development-related fees.
• $30-$35 million in ownership and operational costs for TNDC’s 30 buildings, including the costs of paying and situating social workers in the buildings. Half of this comes from rent collected directly from tenants and half comes from federal and local rental subsidies for low-income people.
• $400 million in development costs over a 5 to 6 year period. This consists of longer-term loans, both public and conventional, and investments and is in addition to the annual expense cited above.

Philanthropically funded TNDC programs

The following programs are funded mainly by a combination of foundation and corporate grants (which often are restricted to specific programs) and about $1 million in unrestricted donations from individuals. Unrestricted donations also help cover some of TNDC’s administrative expenses.

Tenderloin After-School Program

The Tenderloin After-School Program (TASP) costs $600,000 - $700,000 a year. The program is open to children 7 to 18 years old. Mr. Falk believes that TNDC’s after-school programs have a significant positive impact on the life trajectories of the children involved.

Community Organizing Department programs

Community planning

TNDC takes an “equitable development” approach to community planning and land use policy. This means that rather than opposing development, TNDC seeks to minimize the negative consequences of development on — and to share its benefits with — low-income people. Its work in this area includes:

• Reviewing proposed development plans. For instance, TNDC asks developers and architects whether the ground floor of new developments will have retail/commercial space, and whether a portion of those businesses will serve and be affordable to community residents. TNDC also asks about developments’ potential impact on environmental factors (e.g., noise, dust, light and air pollution) and pedestrian safety.
• Testifying before the Planning Commission about proposed developments. It is politically helpful to developers for TNDC to give a statement of support to the Planning Commission.

TNDC has created a Community Planner position to help with these activities.

For example, there is currently a proposal for a new 26-story building on Market St. (“950-974 Market”). TNDC wants to ensure that its design is sensitive, that negative impacts on the community are minimized, and that the community shares in the benefits resulting from the development. In particular, TNDC wants to make sure that the building has commercial services facing Turk St. as well as Market St.

Food justice

TNDC runs several programs focused on food justice and food security (e.g., Tenderloin People’s Garden, TNDC Roof Top Garden Project, and a food distribution partnership with the Heart of the City Farmer’s Market). These aim to provide Tenderloin residents with access to the same food options as residents of other neighborhoods. TNDC is also working to develop a grocery store or other food-security-related use on the ground floor of its Eddy/Taylor affordable housing project. Without a full-service grocery store, the Tenderloin is a “food swamp,” where the product selection is concentrated around sugar, starch, salt and alcohol.

Resident leadership programs

TNDC aims to foster leadership and encourage civic engagement among Tenderloin residents through programs such as:

• The Tenderloin People’s Leadership Academy, in which twelve of TNDC’s residents are enrolled.
• Resident Councils in 12 to 15 of TNDC’s buildings.
• The East Tenderloin Resident Community Association, made up of representatives from the building-level Resident Councils.

These programs provide opportunities for Tenderloin residents to express their ideas and advocate for their own interests.

Potential uses for additional philanthropy

An increase in philanthropic funding could allow TNDC to:

• Expand TASP in the Tenderloin as well as introduce it in other districts (e.g., to a TNDC-operated building in the Mission District where many children live). TNDC would need a long-term commitment of funding to ensure that it could maintain the increased space and staffing requirements of such an expansion.
• Expand and improve its resident leadership programs.
• Increase its political involvement and its work on policy analysis. This might include creating a staff position focused specifically on public policy. TNDC would also like to work with other organizations to develop a cohesive “community plan” for the Tenderloin to help guide the changes that the neighborhood is likely to undergo in the near future.
• Create a full-time data management position to gather information to help improve TNDC’s own operations as well as to share useful data with other groups.
• Acquire a property where TNDC could consolidate its five offices, to accommodate its organizational growth and increase its effectiveness, e.g. by improving communication among staff.
• Acquire additional property, whether vacant land or run-down residential hotels, to eventually turn into affordable housing.

Self-evaluation process

TNDC’s executive staff and department heads go through an extensive process to identify critical issues and decide how to address them in a measurable way.

Each of TNDC’s ten departments and its executive staff has a set of specific annual goals. TNDC produces a monthly scorecard for each department and its executive staff, showing success or failure on ten to twenty target measures. The monthly scorecard is not meant to be punitive; rather, it provides an opportunity for conversation about TNDC’s general performance and how to improve in areas where goals have not been met. The scorecards tie to departmental goals, which derive from the organization’s annual goals and ultimately from its strategic plan.

Goals for 2015

TNDC’s goals for 2015 include:

• Keeping at least 95% of its residents housed.
• Keeping TASP attendance rates at 60 to 65 children who attend the after-school program at least three times per week. Attendance rates can serve as a proxy for the quality of the program.
• Producing a plan for its health initiative by June 30. Mr. Falk believes that there is an increasing consensus nationwide that neighborhood and living conditions have a larger impact than genetic factors on health, education, and other aspects of social well being. TNDC has already created a Health and Wellness Program Manager position

In the area of property management, TNDC has set goals for vacancy rates, building maintenance, and capital improvements, as well as targets for its revenue and bottom line.