The city of Oakland will front up to $2 million for ongoing hotel costs for the hundreds of residents displaced since New Year’s Day from their flooded East Oakland apartment building.

During a special City Council meeting Monday afternoon, the council voted to pay for the lodging costs through April 30 for tenants of the Coliseum Connections complex. The city will seek reimbursement from FEMA and the state. 

Twenty residents called into the meeting, saying they’re “appalled,” “traumatized,” and “mentally drained” from the lack of support they’ve received from their property manager and landlord since they were abruptly forced out of their homes six weeks ago. 

A storm on New Year’s Eve sent several feet of water flooding into the underground garage at the main building on 71st Avenue. PG&E cut electricity in that building and a set of townhouses next to it, to avoid related safety hazards. There are 110 units at Coliseum Connections, half of which are market-rate and half subsidized affordable housing. 

Since then, residents have been staying in hotel rooms paid for by the owner and manager of the property, who initially said renters would be able to return home within a few days. Owner Michael Johnson of UrbanCore Development has said the company is waiting on electrical parts to make extensive repairs, which could take at least two more months because of supply chain issues and problems finding a contractor.

“The owner has told us they do not have funding to cover any further hotels starting today,” said Oakland’s interim housing director Christina Mun. 

Johnson and property management company FPI were not obligated to pay for those hotels but chose to, Mun said. However, the city’s Code Compliance Relocation Program does require the owner to pay each household $500. Johnson did not do that, Mun said, so the city is fronting those checks. Only a few households have received the money so far.

“I would say that ordinance doesn’t in truth really contemplate this type of situation, where an emergency code situation extends this long,” Mun said. “This is a situation where a lot of things went wrong and it’s become a terrible impact to the tenants. We’re trying to problem-solve.” 

The repairs are expected to total $1.25 million, she said, and the city and county will likely each contribute funding. Both Oakland and Alameda County helped pay for the construction of Coliseum Connections in 2019, which was built on BART land.

Mun said the owner’s lease with BART required flood insurance for the property, which Johnson did not have. 

Speaking at the meeting, Johnson disputed that, saying BART waived the insurance requirement “because we’re not in a flood zone.” 

BART spokesperson Alicia Trost told The Oaklandside that BART always requires flood insurance and “did not waive the requirement.” She said Johnson did have a policy during construction and when his company signed a lease with the transit agency. 

Displaced tenants say the experience has been “hell”

Oakland expects to receive nearly full reimbursement for the $2 million in hotel costs from a FEMA program designed to cover shelter in emergencies, and from the state. Oakland is obligated to pay $125,000 of its own money to use these programs. Staff also encouraged the renters to apply for a separate individual assistance program from FEMA, but several said they’d tried to and were denied. 

Tenants who spoke at Monday’s council meeting said they’d rather receive help moving out of Coliseum Connection permanently instead of staying at hotels in hopes of returning. The city money won’t address issues they’ve faced with transportation to work and school from the seven scattered hotels they’re placed at, they said. Many lost their cars in the flood, and some are single parents or seniors who relied on those vehicles. 

Some residents are pregnant and others just had babies, said City Councilmember Treva Reid, whose office, along with Councilmember Kevin Jenkins’, has been working closely with the tenants.

“We’ve been going through hell,” said resident Tracy Peterson. “For us to have to continue to stay here until April or whatever, not knowing when we’ll be able to go home, is that fair? I’m pretty sure we all don’t mind leaving here and finding somewhere else, if we could split the money amongst ourselves. I have to have surgery soon, and I don’t want to have surgery and come back [to Coliseum Connections].”

Tenant Josue Franco said he’s skeptical the building will be habitable by this spring.

“I was there this morning, and being in the lobby you could smell the odor coming from the garage,” he said. 

Several tenants thanked Jenkins and Reid, and spoke about the “peer leaders” who’ve advocated tirelessly for their buildingmates. 

Many pressed the council to hold Johnson and FPI accountable for issues in the building, including security concerns, trash buildup, and deferred maintenance they say dates back to when it opened in 2019. 

Landlord responds to criticism

Johnson defended himself, calling many of the comments made by tenants and city staff are “not true.” 

“There is no specific roadmap within the municipal code for a situation like we experienced over New Year’s Eve,” he told the council. 

“People can talk about my insensitivity but that’s just not true,” he said, adding that UrbanCore and FPI covered hotel costs “out of concern for the residents.”

The cause of the flood is still undetermined, according to the city. Johnson is blaming the water intrusion on poorly maintained city storm drains, saying the structure didn’t flood during previous winters. A city spokesperson did not immediately respond to a question about their latest understanding of possible causes.

At the meeting, Johnson said one-third of all tenants at Coliseum Connections owed rent to the landlord before the flood, and that the eviction moratorium, which prevented him from removing tenants over unpaid rent, caused his company to lose out on money that could have helped maintain the property better.

Several tenants took offense at this statement, saying they were up to date on their obligations. Councilmember Carroll Fife noted that some had likely received rental assistance from the city, which Mun confirmed. 

Coliseum Connections tenants were required to pay rent in January but not in February.

Resident Alex Vila said she and her wife have pulled money out of their retirement account to move to a new apartment.

“I’m not going back to a slumlord,” she said. “The storm didn’t create the crisis—it exposed the crisis.” 

This is not the only recent controversy Johnson has been involved with in Oakland. UrbanCore struck a deal with Oakland in 2015 to buy a large city-owned piece of land by Lake Merritt and build a market-rate apartment tower and an affordable building on it. But the developer struggled to pull together financing, receiving numerous extensions from the city over several years. Last year, the City Council killed the project, making way for a different affordable project on the site.

Mun said the city’s funding agreement with Coliseum Connections gives it some additional options to address issues at the property, including forcing a change in property management or putting a lien on the building if the owner doesn’t reimburse the relocation fees.