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"SF J-Town Community Demands Explanation About Kokoro Assisted Living Loss"
Published in the Nichi Bei Times, February 9, 2006.
Although Kokoro representatives began a Feb. 2 meeting focused on the future of the potential sale to a non-Japantown entity, audience members promptly turned the discussion to the past — demanding explanations about what had happened, how it happened and why they had not been informed earlier.
The Japanese American Religious Federation Assisted Living Facility Inc. (JALFI), the owner of Kokoro Assisted Living, publicly announced Jan. 24 its plans to enter into exclusive negotiations with On Lok, Inc., a San Francisco-based senior health services organization with beginnings in the Chinatown/North Beach community more than 30 years ago.
Angry and disappointed Japanese American community members, who raised approximately $2.8 million over the past decade to help build Kokoro less than three years ago, wondered aloud at the Nihonmachi Terrace meeting why they were informed only after JALFI had entered into exclusive negotiations with On Lok.
"At the outset, the whole community was involved and we all thought it was a good thing and really raised funds for it," said Kathy Reyes, who chaired Christ United Presbyterian Church's fundraising activity in the past decade. "And then the decision was made by a handful of people without our knowing."
"A lot of us gave our time, our money to the project," said David Ishida, regional administrator for the U.S. Department of Health and Human Services' Administration on Aging. "And now just recently a large number of us just found out…how did this occur?"
JALFI representatives attempted to justify the lack of community notice.
"There was a struggle between going out and saying, 'This is where we are' and alarming people and putting the residents' security and stability at risk," explained JALFI Executive Director Stephanie Fujii. "We feel that we made the right decision."
Kokoro residents were informed of the pending sale on Jan. 23, one day before the general public.
JALFI was formed in 1997 by the Japanese American Religious Federation, an 11-member nonprofit corporation consisting of Buddhist, Christian and Shinto churches. JALFI's purpose was to aquire the parcel of land on the corner of Bush and Laguna streets, including a former Jewish synagogue, and to develop and operate the Kokoro project.
A highly successful, community-based capital campaign raised $2.8 million for the project.
"Initially, (Christ United Presbyterian Church) pledged for $40,000 but in the end we gave $70,000," said Reyes.
The San Francisco Redevelopment Agency (SFRA) contributed $5.6 million, and JALFI borrowed a $7 million mortgage from the National Cooperative Bank (NCB).
JALFI Board President Steve Suzuki's explanation of what went wrong focused on the role of the Washington, D.C.-based consultant NCB Development.
" The consultant company that we had early on developed the mortgage," said Suzuki. "It seemed the right package to go with."
But shortly after the 54-unit facility opened its doors in the fall of 2003, problems became evident.
"Six months after, we started noticing that there was an issue, there was a disparity," recalled Suzuki. "That's when we really started talking to NCB Development saying, 'look, you know, there's a difference, what's going on?'"
Although the building operates within cost, said Suzuki, it doesn't make enough to cover the mortgage payments too.
The SFRA assisted with mortgage payments, and in September, JALFI attempted to directly negotiate with the NCB board to restructure their mortgage.
"(JALFI wrote) directly to (NCB's) board of directors, asking them for their assistance… 'Can you help us save this?'" said Suzuki, adding that the NCB board was also told that the SFRA was offering additional funds, but nevertheless, "their response was 'no.'"
"In September, the bank stated unequivocally that they were unwilling to participate and work out a solution," said Fujii.
In October, the SFRA proposed a plan for restructure.
Two organizations, including On Lok and the American Baptist Homes of the West, submitted proposals by the Dec. 30 deadline.
On Jan. 24, JALFI publicly announced its entrance into exclusive negotiations with On Lok.
According to Kokoro, the deal with On Lok, subject to SFRA approval and targeted for closing in June, would provide $8.5 million in new funds to the project, of which On Lok would provide $2.75 million. The SFRA may supply an additional $5.25 million.
"On Lok (is) really gifting another $3 million, about coming in equal with the Japanese community," said JALFI board member Bill Baird.
Representatives of On Lok attempted to reassure the audience of their good intentions.
"This isn't a money-making enterprise, believe me," said On Lok Executive Director Bob Edmondson. "We have no axe to grind one way or another, we really don't. We're trying to do the right thing for the community."
The bid, said Edmondson, proposes a seven-member board, "two of which would be named by JALFI, but the rest would come from the community."
Edmondson also told the audience that there will be no change to the current income level structure, and that Kokoro residents "absolutely, categorically" would not be required to join PACE (Program of All-Inclusive Care for the Elderly), On Lok's well-known health program.
Suzuki emphasized that "the services, the building, the name, everything still stays there. The building is still within the community."
But others disagreed.
"The whole thing has to do with ownership," said Reyes. "The money that we put in for this building is now no longer ours. Even if the services remain the same, the actual ownership (would be) transferred in terms of the sale and I think there are some of us, a few of us, that are upset about that."
On Lok Board of Directors Vice President Wellman Tsang said that he observed a "deep hurt" in the community, but asked that they "stay committed to the seniors" because On Lok relies on community participation to remain informed.
"The center that we have in the North Beach area, one of the biggest complaints that we had was that the French bread was too hard," he said, drawing a few chuckles from the audience. "My mother-in-law, if the rice isn't right, she won't eat. So I understand how important something like that is. And when it's brought up, what do we do? We fix the bread, we fix the rice."
But long-time community advocate Jeff Mori remained upset about the earlier lack of public information provided.
"People were asking questions about what was happening and here we got a turnaround as it occurred within the last month. One month, when this has been going on for over 18 and before that longer," said Mori. "We should've had an earlier resolution…if I didn't go to the press, this goddamn meeting would've never taken place!"
He then grabbed his coat and stormed out.
Earlier in the evening Mori suggested that more than one community meeting would be necessary.
"First you gotta talk about what happened, and then you can start to talk about what the alternatives are…How do we know it's gonna work?" he asked. "The same board that made that decision and kept the secret is making the selection and the recommendation."
A follow up meeting to discuss Kokoro's future is scheduled for Thursday, Feb. 16 from 6:30 to 8 p.m. at Nihonmachi Terrace, 1615 Sutter St. in San Francisco's Japantown. Representatives from the JALFI Board and On Lok Executive Director Edmondson are scheduled to attend.
A Mayor's Western Addition A-2 Citizens Advisory Committee (WACAC) meeting will be held on Thurs., Feb. 9 from 6:30 to 8:30 p.m. at City Hall, Room 34, to discuss whether the Committee supports the refinancing plan for and transfer of ownership of Kokoro, including the proposed additional $5.25 million of Redevelopment Agency funds.