The City and the virus

Tired of reading about the coronavirus?

If so, you should skip this column.

But if you’re interested in how the COVID-19 pandemic has affected the City of Alameda and its residents – and what the City has done to help – read on.

Today, we’ll present an overview of the data on the public-health and economic impacts of the virus in Alameda and report on the actions taken by the City in response to the pandemic.  Next week, we’ll post a separate piece about the impact and response by Alameda-based non-profits.

Local impact of COVID-19

Public health impact

How has COVID-19 affected Alamedans’ health? The four standard measures are new cases, deaths, hospitalizations, and ICU admissions.

New cases.  The Alameda County Public Health Department publishes data on new cases by zip code, and Sarah Henry, the City’s Public Information Officer, has used that data to create a series of charts for the City of Alameda and posted them on the “Coronavirus (COVID-19) Cases” page on the City website.

Here’s the latest (as of December 10):

As the charts show, Alameda has not been immune from the recent surge in new cases.  The webpage also reports that new cases reported in the City for the most recent seven-day period increased from 57 to 87 compared to the previous seven-day period.  For the last 30 days, the total has risen from 225 to 247.

In addition to the totals, the County PHD breaks down new cases by age, race/ethnicity, and gender, and Ms. Henry has prepared corresponding charts for the City of Alameda.  Here they are:

We’ll leave it to the ethnographers to comment about whether the data shows that COVID-19 has had a “disproportionate impact” on persons of color in the City of Alameda.  (FYI:  According to the most recent American Community Survey, the City’s population was 7.4 percent Black and 12.8 percent Hispanic.)  But we did want to note that the age distribution for the City pretty much mirrors the age distribution for the County as a whole, with the majority of cases in the 18‑to‑30 age group.

Deaths.  According to the webpage, 17 people in Alameda have died of COVID-19.

Hospitalizations.  The PHD reports the number of patients who have been hospitalized for treatment of COVID-19 on a County-wide basis, but, unlike the new cases, it does not break down the numbers by zip code.  Fortunately, Tracy Jensen, an Alameda Heathcare District director, Alameda Health System board member, and Alameda resident, has begun posting the data for Alameda Hospital on her Facebook page.

Here’s her most recent table:

We asked Ms. Jensen for historical data, and she gave us the following chart of the number of patients admitted to Alameda Hospital for COVID-19 treatment since May:

ICU admissions.  Ms. Jensen did not know whether the patients now being treated for COVID-19 at Alameda Hospital were in the Intensive Care unit, but she said the Hospital’s ICU has a capacity of eight beds.

Ms. Jensen also cautioned that ICU bed capacity is “just one indicator of how well a hospital can respond to increased rates of COVID-19 infection in the community.”  The number of negative pressure rooms and ventilators likewise demonstrates “service availability.”  She told us that Alameda Hospital had “transitioned” 20-23 hospital rooms to NPRs during the last nine months; as of December 10, three were in use.  Similarly, the hospital has 20 ventilators, eight of which are “in use by patients with respiratory conditions that may include COVID-19.”  On the whole, Alameda Health System had 82 ventilators “available for deployment” at four acute-care hospitals and two post-acute-care facilities.

Of course, Alameda Hospital isn’t only the hospital at which Alameda residents infected with COVID-19 are receiving treatment, but we could not find any data about Alamedans hospitalized elsewhere.

Economic impact

The stories in the national press about the economic impact of the COVID-19 on individuals and businesses usually contain data on such items as business closures, unemployment claims, etc.

We have been unable to find any Alameda-specific statistics in these categories.  Amanda Gehrke of the City’s Economic Development Department sent us a spreadsheet showing that, based on business license data, 554 Alameda businesses had closed from June 2019 through November 2020, but the City does not collect information about the reasons for the closures.  Likewise, the state Economic Development Department publishes statistics on unemployment claims, but it breaks down the data only by county, not by city.

Nevertheless, we can offer a few bits of factual information, even if some of it is by now out-of-date.

Around June, the Alameda Chamber of Commerce conducted an online survey of local businesses.  Of the 68 respondents, 35 businesses had temporarily closed and another 21 had reduced hours or cut back operations.  Obviously, these numbers will have changed since then, but we could not find any updated information.

In September, staff presented Council with two reports:  one on applications by renters to the City’s emergency rent relief program (about which more below); the other on a survey emailed to 2,393 landlords, to which 519 responded.

The first report contained a chart, based on applicant comments, on how COVID-19 had affected tenants.  Here it is:

In addition, the applicant report contained this chart on unpaid months of rent:

It also stated that, based on 287 completed applications, the average amount in arrears was $3,959.

Presumably, the tenants who applied for the emergency rent relief program were the most in need.  The landlord survey covered a broader universe, and it provided additional information.  According to the survey, the vast majority of tenants were still paying full rent.  It contained this chart:

It also stated that, in the aggregate, $678,690 in rent was in arrears.

We could find no updates to either of these two reports.

Finally, it occurred to us that another indicator of the economic impact of the virus on Alamedans – whether renters or homeowners – would be the service volumes of Alameda-based non-profit food providers.

Cindy Houts, executive director of the Alameda Food Bank, told us that, pre-pandemic, the Food Bank served about 800 families a month at its pantry, plus another 200 a week at its weekly perishables program.  Now, it is serving between 1,700-1,800 families a week by means of its drive-through distribution system.  Ms. Houts said that the volume had decreased slightly in September and October, but it was “on the rise again,” including an increase in first-time users.  “My sense is that we will see more clients with this latest shutdown,” Ms. Houts told us, “and who knows what will happen if Congress doesn’t approve any more aid.”

Peri Drake, director of Alameda Meals on Wheels, told us that the organization served an average of 141 meals per day in November.  She said the numbers had “gone up and down” during the pandemic.  “We definitely had a big increase at the start of the pandemic,” she told us, “but things have calmed down a bit since then.”

The pandemic has had financial consequences not only for individuals and businesses in Alameda but also for our local government.

After Council issued a declaration of emergency on March 17, staff prepared a revised forecast for fiscal year 2019-20.  The “best estimate” projected that General Fund revenue would be $7.7 million lower than the amount projected only two weeks previously.  Of this decrease, $4.4 million was attributable to an anticipated decline in sales and use tax revenue (resulting from lower consumer spending during the pandemic).

The fiscal year ended on June 30, and, earlier this month, staff presented the actual (but unaudited) annual numbers.  The bottom line turned out far better than the “best estimate”:  total General Fund revenue for FY 2019-20 was $109.9 million (compared to the $100.1 million “best estimate”).  And there was no decline in sales and use tax revenue at all.  Indeed, actual revenue from this source ($16.9 million) slightly exceeded the pre-pandemic projection ($16.7 million).  All but one of the other revenue items likewise beat the “best estimate,” with property taxes and transfer taxes leading the way.

Nevertheless, as we’re sure City Manager Eric Levitt and Finance Director Annie To would be the first to point out, the FY 2019-20 results do not mean that the City is out of the woods.

The recently reported results include only one quarter of activity during the COVID‑19 pandemic, and the staff report flagged one area of concern.  FY 2019-20 was the first full year in which the ½ percent sales tax increase (which the City prefers to call the “transaction and use tax”) approved by the voters in November 2018 was collected.  Excluding that tax, sales tax revenue dropped 12 percent in the fourth quarter of FY 2019-20 compared to the fourth quarter of the previous fiscal year.

The City hasn’t published any data on financial results for the first quarter of FY 2020-21, which began on July 1.  Thus, we can’t yet assess the impact of the pandemic on City finances from July through September (or thereafter).

Staff has, however, made a number of adjustments to the FY 2020-21 budget originally approved by Council in June 2019.   This June, staff revised the estimated General Fund revenue downward by $3.3 million from $103.2 million to $99.9 million, with the largest decrease ($1.3 million) coming in sales and use tax revenue.  Then, on December 1, it bumped the estimate back up by $1.8 million to $101.7 million due to projected increases in property tax and “transaction and use tax” revenue.  At the same time, it cut estimated sales tax revenue by another $600,000, and the staff report warned that the actual decline could be as much as $9 million.  We’ll have to wait and see.

City of Alameda responses

After Council declared a public-health emergency on March 17, the City took a variety of steps to mitigate the impacts of the COVID-19 pandemic on Alameda residents.  Those steps focused on renters, small businesses, and tenants of City-owned property.

Renters

One of the very first actions taken by Council was to impose a “moratorium” on evictions for non-payment of rent by tenants who had suffered a “substantial loss of income . . . relating to or resulting from the COVID‑19 pandemic.”  For residential tenants, “substantial loss of income” was defined to include a reduction of 20% or more of a tenant’s monthly gross income; “extraordinary” out-of-pocket medical expenses; or “extraordinary” child-care needs arising from school or child-care closures.  For commercial tenants, the term meant a reduction of 20% or more of a commercial tenant’s monthly gross income or “extraordinary business expenses necessarily incurred.”

Under the originally proposed ordinance, the moratorium – which, technically, took the form of a “substantive defense” to an unlawful detainer action – would last for 180 days after the emergency declaration was lifted.  The effect was that a tenant who had lost income or incurred “extraordinary” expenses because of COVID-19 could forego paying rent for the duration of the pandemic.  Rent would continue to accrue during that period, and the tenant would be obligated to start paying rent again once the pandemic ended.  But the ordinance gave the tenant 180 days thereafter in which to pay the “deferred” rent without fear of being evicted.

The ordinance adopted by Council in April made several changes.  First, it broadened the defense against eviction for non-payment to cover the case where the tenant failed to resume paying rent for 30 days after the pandemic ended (rather than immediately).  In addition, it gave the tenant 210 days after the emergency declaration was lifted (rather than 180 days) in which to pay the “deferred” rent.   Finally, Council expanded the ordinance to cover not just evictions for non-payment of rent but all “no fault” evictions including owner move-ins.

Later, Council made additional changes.  In July, it lengthened the period for payment of “deferred rent” from 210 days after rescission of the emergency declaration to 395 days after rescission.  Then, in October, it passed an ordinance mandating that, if a landlord and a tenant “enter into an agreement” for payment of “deferred rent,” the landlord’s “sole remedy” if the tenant doesn’t pay is monetary damages and the landlord must waive its right to file an unlawful detainer action.  After getting legal advice from the City Attorney, Council abandoned the idea – floated by Councilman Jim Oddie – of “converting” deferred rent into “consumer debt” and thereby eliminating an unlawful detainer action as a remedy for non-payment.

How many evictions that otherwise would have occurred did the moratorium prevent?  We’ve never seen any data, and the City apparently doesn’t have it, either.  But even as the ordinance benefits tenants, it makes things pretty tough for landlords:  they may not see a dime of rent during the pandemic, and they’ll have to wait more than a year to recoup their loss.  And if, strapped for cash, they agree to give their tenant a break on the deferred rent, they may end up with only a piece of paper suitable for framing if the tenant later reneges.

Going forward, we wonder whether landlords will be willing – or able – to wait until the pandemic ends and the 395-day moratorium expires.  Remember, the ordinance doesn’t prohibit a landlord from bringing an unlawful detainer action (such a prohibition likely would violate state law); it only gives the tenant a “substantive defense” in such an action.  But the defense exists only if the tenant actually suffered a substantial loss of income as a result of COVID-19.  We imagine that an aggressive landlord’s attorney might want to put the tenant asserting such a claim to her proof.

Imposing the moratorium on evictions wasn’t the only action taken by the City for the benefit of residential tenants affected by the pandemic.

Council also passed an ordinance freezing rents for “regulated residential rental units” – i.e., units covered by the rent-control ordinance.  Originally, the freeze prohibited landlords from raising rents between April 21, 2020, and the end of this year.  This Tuesday, Council will decide whether to extend it to June 30, 2021.  If it does (as it surely will), a landlord who didn’t raise rents before the pandemic hit won’t be able to avail itself of the rent increases otherwise permitted by the rent-control ordinance – which total 3.8 percent – until July 1, 2021.  How many landlords find themselves in this boat is unknown.

Finally, the City used $583,118 from a CARES Act grant to set up a “emergency rent relief program.”  (A subsequent CARES Act grant added $130,000 to the fund.)  The program pays up to $3,500, or one-month’s rent, whichever is less, directly to landlords on behalf of residential tenants who are “experiencing an unforeseen financial crisis and inability to pay rent due to a loss of income related to” the pandemic.  To date, Ms. Henry told us, more than 60 applications have been approved and a total of $190,000 authorized for payment to landlords.

Small businesses

The City has adopted several programs intended to aid small businesses affected by the pandemic.

In April, Council created a $600,000 fund to provide one-time grants of up to $7,500 apiece to restaurants and small businesses with one to 25 employees.  The money came from the General Fund ($250,000), the commercial revitalization fund ($252,500) and the base reuse fund ($97,500).  According to the City website, the program received 238 applications and awarded grants to 64 restaurants and businesses.

At the instigation of Mayor Marilyn Ezzy Ashcraft, Council also directed staff to set up a “community relief fund” that would seek private donations and make grants to small businesses, non-profits, and residential renters.  This fund became known as “Alameda Strong.”  Small businesses and non-profits can receive a one-time grant of up to $7,500; residential renters can get up to $3,500 paid directly to their landlords.

According to the Alameda Strong website, the fund has received $120,000 in donations so far; the goal is $1 million.  To date, Ms. Henry told us, 10 small businesses have gotten grants totaling $71,250; another 11 applications for small-business grants are under review.  The City began accepting applications from residential renters last week.

The other major program adopted by the City to aid local businesses was the “commercial streets” program, which was designed to make it easier for businesses to operate in compliance with County health orders.

Under the program, the City reduced the traffic lanes in the Park and Webster Street business districts from four to two; restricted parking to curbside pick-up only, and issued district-wide encroachment permits allowing businesses to use City-owned sidewalks and parking lanes for retail and commercial purposes.  It also issued permits enabling businesses, City-wide, to convert parking spaces into “parklets” for outdoor dining and merchandise display and to use privately owned outdoor space and parking lots for these purposes.  To date, Ms. Henry told us, the City has issued 25 “parklet” permits, with six more applications in the queue.  It also bought 80 water-filled barricades to protect the parklets from moving vehicles.

Tenants in City-owned property

The City has adopted two programs offering rent relief to tenants of City-owned property, one for all Alameda Point tenants, the other specifically for non-profits and businesses located in Spirits Alley.

After the emergency declaration, the City allowed Alameda Point tenants to defer payment of rent for two months, which was later extended to three.  Staff then proposed, and Council approved, a “loan conversion” program under which a tenant could convert past-due rent into a loan payable on a negotiated schedule.  In addition, if the tenant met negotiated milestones, the City would forgive all or part of the loan.

Through October, staff had received seven requests for assistance under this program.  Staff then came up with a separate program for non-profit and Spirits Alley tenants, who, staff said, were “on the brink and need relief.”  Under this program, the tenant could defer up to nine months of rent, repayable over three years (with a minimum of three months’ rent repaid every year); it also could get a one-, two-, or three-month rent abatement depending on when it repaid the entire deferred amount.

Council approved the second program at its October 6 meeting.  (Later, Council allowed businesses that had applied for a “loan conversion” to opt into this program instead.)  At the same meeting, it committed $1.5 million from the base reuse fund to back the “loan conversion” program and gave the Alameda Theater a special nine-month rent abatement.

As of December 1, eight Alameda Point tenants had applied under the two programs.  The total amount sought under the “loan conversion” program was $460,426; the total potential rent abatement under the non-profit/Spirits Alley program was $114,132.  Since then, two more tenants have applied under the latter program, adding $42,225 to the total.

* * * * *

Thus far our report.  We’ve tried to stick to the facts and leave the politicians out of it.  (Still stinging from the defeat of Measure Z, John Knox White surely can use a break.)  There may be items we’ve missed, and when we post the piece on non-profits, we’ll update this one, too, with any new information.

Sources:

City finances: 2020-06-16 staff report re mid-cycle budget; 2020-12-01 staff report re 4Q 2019-20 financials

Rent moratorium/freeze: 2020-04-07 staff report re moratorium, etc; 2020-04-21 staff report re moratorium, etc; 2020-07-21 staff report re moratorium; 2020-09-01 staff report re rent deferrals; 2020-09-01 Ex. 1 to staff report – Data Highlights from the Landlord Survey; 2020-09-01 Ex. 2 to staff report – Overview Emergency Rent Relief Applications; 2020-09-01 staff report re landlord remedies; 2020-12-15 staff report re rent moratorium

Emergency rent relief: 2020-06-02 staff report re CARES Act grant; 2020-11-17 staff report re CDBG grant

Small business grants: 2020-04-21 staff report re Small Business Relief Grant Program; 2020-05-19 staff report re Alameda Strong

Commercial streets: 2020-05-19 staff report re slow streets, etc.; 2020-10-20 Ex. 1 to staff report – Status Report on Transportation (September 2020)

Alameda Point tenants: 2020-04-21 staff report re Rent Relief for City of Alameda Commercial and Residential Tenants; 2020-05-19 staff report re slow streets, etc.; 2020-10-06 staff report re A.P. commercial tenant rent relief; 2020-12-01 staff report re Spirits Alley rent relief program; 2020-12-15 staff report re Spirts Alley rent relief program