Friday News Roundup
PUSH FOR EMERGENCY DECLARATION ON HOMELESSNESS MOVES FORWARD
Despite opposition from Mayor Ed Lee, legislation declaring a state of emergency on homelessness in San Francisco is headed toward the Board of Supervisors with what appears to be veto-proof support.
The emergency declaration, introduced by Supervisor David Campos earlier this month, is intended to let the city bypass some rules around structural and habitability requirements and speed up the opening of new Navigation Centers, special shelters offering more flexible rules to clients and access to intensive services and supportive housing.
Campos moved to introduce the emergency declaration after expressing frustration over the city’s slow progress in opening new Navigation Centers. The first such center, which opened in the Mission District a year ago, has been widely hailed as a success in moving homeless residents into permanent housing, but offers only 75 beds.
Lee has come out strongly against the emergency declaration and companion legislation Campos introduced Tuesday calling for the opening of six more Navigation Centers within a year, dismissing the proposals as political grandstanding and “rhetoric.”
However the legislation was approved unanimously today by the Public Safety and Neighborhood Services Committee and has eight supervisors supporting it, meaning it has enough votes to potentially override a mayoral veto.
Campos noted today that while officials with the mayor’s office had said earlier this month that it would take as long as six months to open a new Navigation Center, they acted quickly to announce a new site this week following the introduction of his legislation, as well as 200 new units of supportive housing. The new 93-bed Navigation Center will open at the Civic Center Hotel in June, the mayor’s office said Wednesday.
“I don’t mind being attacked or being a political piñata so long as we have results at the end of the day,” Campos said.
The committee approved one amendment, introduced by Supervisor Norman Yee, clarifying that the legislation was not intended to override city policies around public outreach or planning processes around selecting locations for shelters. The amendment came in response to concerns from neighborhood groups that the measure could lead to shelter sites being chosen without community input.
STATE OBTAINS $1.1 BILLION DEFAULT JUDGMENT AGAINST DEFUNCT CORINTHIAN COLLEGES, AMOUNT STUDENTS WILL RECEIVE IS UNCLEAR
The state of California has won a $1.1 billion default judgment against the now-defunct Corinthian Colleges Inc. in a fraudulent business practices case in San Francisco Superior Court.
The judgment, signed Wednesday by Superior Court Judge Curtis Karnow, ends a civil lawsuit filed in 2013 by California Attorney General Kamala Harris.
It finds that the company, once one of the largest for-profit career preparation chains in the nation, engaged in false and misleading advertising, illegal debt collection and other frauds.
The judgment orders $820 million in restitution to students residing or attending school in California since 2010 and $350 million in civil fines. But it is unclear how much, if any, money students or the state will receive as a result.
Corinthian, formerly headquartered in Santa Ana, and its subsidiaries declared bankruptcy on May 4, 2015, a few days after the company closed its remaining schools, including Heald, Everest and Wyotech colleges in California. The company listed debts of $143 million and assets of $19 million.
A liquidation plan approved by a federal bankruptcy judge in Delaware in August distributed Corinthian’s remaining assets, of which $4.3 million was provided for a student trust.
A website for that trust says it will use “the relatively minor amount of cash that was available” to work on ways to obtain cancellation of former students’ loan debts.
In a statement filed in Superior Court in January, lawyers from Harris’s office said that even though Corinthian has been dissolved and its assets distributed, the forthcoming default judgment could help students in obtaining loan forgiveness and in receiving payments from California’s Student Tuition Recovery Fund. The state fund was established to help students whose schools have closed.
Harris press secretary Brenda Gonzalez said today, “We fully expect that this judgment will be helpful for students and advocates to demonstrate that they should not be held liable for private loans, federal loans, or other purported debts due to Corinthian Colleges Inc.’s illegal conduct.”
In addition, Gonzalez said, “This judgment also sends a clear message to other for-profit institutions still operating in this industry that there are severe consequences for this kind of misconduct.”
Karnow signed the default judgment after Corinthian’s bankruptcy lawyers failed to respond to Harris’s request for the ruling. The lawyers told Karnow in December they could not respond because Corinthian no longer exists.
Among other findings, the 21-page judgment concluded that Corinthian systematically misstated its job placement rates for students in its advertising.
It also said that Heald and other Corinthian affiliates ran “millions of online and mobile ads” since at least 2010 saying they offered programs in California for training ultrasound, X-ray, radiology and dialysis technicians, but did not in fact offer such programs.
At the time the lawsuit was filed in 2013, about 26,000 of Corinthian’s 80,000 students nationwide were Californians, according to Harris.