The Lompoc Warming Center lives up to its name.
It’s a cold, blustery weeknight in mid-January. As the winter daylight wanes, people slowly trudge through the center’s doors. Each person is bundled in a thick coat or parka and a fuzzy hat or gloves.
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“It looks like we’re going to get some rain,” says Doug Conley, pastor of New Life Christian Center, the church that runs the Warming Center with Good Samaritan Services.
The temperature inside the center, however, is comfortable. In the air there’s the distinct scent of turkey and mashed potatoes cooking. It smells like Grandma’s house on Thanksgiving Day.
But this isn’t Grandma’s house.
In the middle of the room, there are more than a dozen cots arranged in rows or in partitioned squares. Slightly to the left of the sleeping area is a long line of white plastic tables surrounded by metal folding chairs.
Still, people are happy to be out of the cold. They sit at the tables in groups, sipping on coffee or soda and talking in hushed tones as they patiently wait for dinner to be served.
From November to March each year, the Warming Center opens its doors to homeless locals on nights when the temperature drops below 35 degrees or there’s a 50 percent chance of rain.
“We don’t ask any questions. We don’t even ask them their names,” Conley says. “The big thing is we make a homemade meal every night.”
On tonight’s menu, as predicted, is turkey and mashed potatoes.
“These people are our guests. If you had guests over, what would you feed them—peanut butter and jelly and Top Ramen? No. And that’s not what we’re going to do,” Conley says.
Tonight, there are more guests than usual because the center is acting as an emergency shelter for former residents of the Bridgehouse, a county-funded homeless shelter run by the now defunct Lompoc Housing and Community Development Corporation (LHCDC).
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For more than a decade, the nonprofit provided residents emergency shelter and low-income housing services, among other things.
In the wake of the nonprofit’s dissolution, LHCDC officially closed the Bridgehouse on Jan. 16. Residents were given 72 hours’ notice that they needed to leave.
“We were told Friday night that we’d have to be out by Monday. I basically said that it wasn’t fair. I don’t mind being out on the streets, but I do need that place to get my kids back—I need a steady address. And it wasn’t fair to the children and to the pregnant mom,” former Bridgehouse resident Priscilla Fowler says matter-of-factly.
“We weren’t even told why we were being kicked out,” she continues, adding that when she asked Bridgehouse manager Chris Moody about the eviction, “[Moody] said, ‘I can’t tell you that.’ I asked her who her boss was so I could get some answers, and she refused to tell me.”
How did we get here?
This kind of evasiveness from people involved with LHCDC is nothing new; it’s been chronicled, as has the organization’s financial troubles, at board meetings, in court documents, and by media countywide.
LHCDC—and the millions of dollars it received in federal and state grants—has been a popular topic among the upper echelon of local government and public service agencies for years. But the issue didn’t enter the public sphere until within the last year.
At the beginning of 2011, the county’s Housing and Community Development division alerted the Auditor-Controller’s Office that LHCDC was having financial problems.
“It became aware that they hadn’t done audits [since 2007],” Auditor-Controller Bob Geis told the Sun. “[LHCDC] wanted the county to execute new grants for additional emergency shelter services.
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“We asked to see their books,” he continued. “It was then that we realized they didn’t have a good set of books.”
Geis sent a letter to LHCDC Executive Director Sue Ehrlich requesting she deliver to the county bank statements, cancelled checks, payroll reports, and other financial documents.
“We were able to determine from records in their checkbook … that they had at least $600,000 worth of past due debts and liabilities,” Geis said.
He then wrote a letter to LHCDC’s board members informing them that the county would no longer be able to disburse grants to the organization until they got their finances in order.
“It appears as a result of the economic downturn and the cost of completing the College Park project, the Lompoc Housing and Community Development (LHCDC) is under significant financial distress,” Geis wrote in the letter. “LHCDC’s Board of Directors has a fiduciary duty to make certain corrections so that LHCDC can continue to operate.”
He also sent a letter to the Santa Barbara County Board of Supervisors recommending it not allocate more money to LHCDC until the corporation made the necessary corrections.
According to a binding agreement between LHCDC and the county, the corporation is required to have its finances audited each year and to provide those statements to the county within six months of completion.
But Geis told the Sun he was “unaware of any financial statement audits of LHCDC subsequent to 2007.”
The county wasn’t the only institution having problems with LHCDC.
In September 2011, Solvang-based Pacific Western Bank filed a lawsuit against the nonprofit for its failing to pay more than $5 million in loans on seven of its 38 Lompoc properties. Shortly after, a Santa Barbara County Superior Court judge ordered that the properties be taken into receivership.
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Around this time, LHCDC’s Board of Directors announced that the nonprofit would be dissolving by year’s end. People started resigning, including Executive Director Ehrlich and LHCDC Board President Susan Warnstrom.
Citibank filed a second lawsuit against the nonprofit in November, listing the city of Lompoc as a defendant because officials allocated thousands of dollars to LHCDC through the city’s redevelopment agency. The suit claimed the nonprofit failed to pay monthly installments on a $300,000 loan from February 2001. Another judge later ordered that those properties be placed in receivership as well.
The suit prompted Lompoc City Council members to request a staff report on all of the city’s LHCDC-related liabilities. The report revealed the city was responsible for almost $2.7 million in outstanding federal and Lompoc Redevelopment Agency loans. Of that amount, staffers viewed $857,563 as at “low risk” for repayment, and $300,000 as “high risk.”
At a City Council meeting on Dec. 6, 2011, several Lompoc residents lamented the lack of accountability and government oversight when dealing with LHCDC.
“People have been asking about LHCDC for 10 years, and the general attitude was that it was a ‘hands-off’ organization,” said Joyce Howerton, who served as mayor of Lompoc from 1992 to 1998. “At some point, everyone’s got to get honest about this. … You need to lay it out so everyone understands what happened and what’s happening and what’s going to be happening.”
The council ultimately agreed with Howerton and asked city staffers to expand their report to include a more detailed timeline of at-risk properties, and to include information on whether the properties were out of compliance with state and federal mandates.
“I’m extremely alarmed that some of the properties were refinanced and money was being taken out,” City Council member Cecilia Martner said at the meeting. “What is it the city allowed LHCDC to do? How much money is the city losing because of the foreclosures?”
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Things fall apart
The unraveling of LHCDC culminated with the closure of the county-funded Bridgehouse and the Marks House, Lompoc’s city-funded transitional housing shelter, on Jan. 16, 2012.
Lompoc Mayor John Linn said the city was notified by LHCDC leaders on Jan. 12 that the Marks House would be closing. City officials then called Sylvia Barnard, executive director of Good Samaritan Services, and told her the organization needed to take over the Marks House as soon as possible.
In anticipation of LHCDC’s dissolution, the city selected Good Sam as an interim service provider in December, giving Barnard and her staff time to develop a transitional plan.
City Attorney Joe Pannone drew up the deed in lieu for the Marks House on Jan. 17, and “two LHCDC members promptly came over and signed it,” Linn said.
The council also voted at its meeting later to allocate $11,000 worth of grant money to Good Sam to help run the shelter facility.
“We’ve moved quite briskly through the Marks House. We’re ready to give them the keys. It was a relatively easy, well-planned process,” Linn said after the meeting, but he admitted that LHCDC’s dissolution has kept the city incredibly busy.
When asked to speculate on what went wrong, Linn said, “There’s no simple answer; poor decisions were made for a long time. … LHCDC expanded into other areas besides housing at the request of the city, and it could be said that they expanded too rapidly. And that happened at the same time as the unfortunate economic events of 2008.
“This closure is something that has never happened, and nobody has experience dealing with something like this, so people are going to make mistakes,” he said. “But it won’t happen again.”
Barnard said her organization has been working diligently to pick up the pieces LHCDC left behind. Good Sam held a grand re-opening of the Marks House on Jan. 25, where Barnard and other officials welcomed the media and area residents to tour the 103-year-old house on North N Street.
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“The community’s response to a crisis like this has been incredible, especially New Life church,” Barnard said at the event.
Alfie’s Fish & Chips donated the first dinner for Marks House residents. Good Sam received donated produce from local restaurants, and pillows, blankets, and other supplies from Foursquare Church.
The Marks House, Barnard said, would serve as an emergency shelter for families, including fathers, and the Warming Center would serve individuals until the Bridgehouse re-opened as well.
When the shelters closed, there was only one family living at the Marks House. That family was transferred to housing at the Good Samaritan Shelter in Santa Maria. However, things weren’t as clear-cut for the 20-plus people living at the Bridgehouse.
“It’s such a shame,” Barnard said of the Bridgehouse closure. “Instead of trying to find an alternative provider, LHCDC just closed. It’s not right. It could have been an easier transition if they had handed the property over sooner.”
As of press time on Feb. 7, LHCDC still hadn’t transferred the Bridgehouse’s deed in lieu to the county.
In a Feb. 7 conference call with the Sun, Santa Barbara County Community Services Director Herman Parker and Community Services Deputy Director Sharon Friedrichsen said the LHCDC Board of Directors recently passed a resolution expressing the board’s “willingness to provide” to the county the deed in lieu for the Bridgehouse. That resolution must be accepted and approved by the Board of Supervisors in order for ownership of the shelter to be transferred.
The Board of Supervisors is expected to discuss the Bridgehouse and potentially select an interim service provider at its Feb. 21 meeting. The county has received an operations proposal from Good Samaritan Services.
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Where do we go from here?
Despite the ownership transfers of the homeless shelters and several other properties, there are still lots of questions about what went wrong and what steps can be taken to make sure something like this doesn’t happen again.
The Sun contacted more than a dozen people for this article, including Lompoc City Council members and staffers, Santa Barbara County 4th District Supervisor Joni Gray, and county staffers.
Out of all those people, no one seemed to truly understand what happened with LHCDC, and if someone had additional information, he or she refused to go on record with it.
LHCDC Executive Director Ehrlich and Bridgehouse manager Chris Moody didn’t return multiple phone calls for comment. When the Sun finally reached LHCDC Board President Warnstrom—who’s also an administrative assistant for Supervisor Gray—she declined to comment, saying she had “already said enough.”
LHCDC’s legal representative, Stephen Taber of Meyers Nave law firm, said, “We have been engaged by the organization to dispose of its property and wrap things up.”
He declined to answer any questions about the nonprofit’s finances or operations, only stating, “There is an effort to get the Bridgehouse transferred and back into operation. Everyone is working really hard to get that done.”
Lompoc City Council member Martner, who was elected in 2008, has repeatedly expressed her concerns about LHCDC at City Council meetings and to the media.
“[LHCDC officials] say they’re dissolving, but they haven’t given official notification that they are dissolving, which is required by the state,” Martner told the Sun in a recent interview. “The organization all along has not been very forthcoming with information—even basic questions about finances or even who was on the board. It’s been very frustrating.
“We’re still waiting for a comprehensive report from the city staff about the financial risk involved; what’s been paid off, what was refinanced, and where that money went,” she continued. “The council and the public deserve to know—we’re talking about millions of dollars. I think this is just a sad example of just how inefficiently these programs were run and how much money was wasted. There was no government oversight, and I think that’s a crime. And that’s not just [on] the city of Lompoc, that’s [on] the county, too.”
She said the council is looking into drafting a policy in which the city “spells out how money is given out and what kinds of checks in compliance and oversight need to be done so this doesn’t happen again.
“From what I’ve seen, they all looked the other way. It’s a lack of accountability,” she said.
Lompoc City Attorney Pannone was hesitant to speak in detail about potential legal actions the city or county could take to hold LHCDC accountable. Pannone is party to current closed-session meetings between the City Council and LHCDC’s lawyers regarding the Lompoc Theater.
“In general, people who use public money have a fiduciary responsibility to spend it correctly, and there are certain criminal and civil statutes to make sure they use it correctly,” he said.
Former Bridgehouse resident Fowler said she’s glad her local leaders are doing something about what happened.
“Yeah, we shouldn’t get too comfortable at the shelter, but it was all I had,” she said. “If anybody can help with anything—answers, rooms for rent, resources—come … talk to us. We’re not going to bite.”
Contact Managing Editor Amy Asman at aasman@santamariasun.com.
This article appears in Feb 9-16, 2012.