The dark side of housing homeless vets in Portland

PORTLAND, Ore. (KOIN) — The City of Portland shut down a government-funded veteran-supportive housing complex, deeming it dangerous to live in. The decision came after officials and contractors discovered water damage and a deteriorating roof, which led to a serious ceiling collapse and mold infestation.

This action is forcing all of the veterans who lived there out of the property, leaving them with an uncertain future for long-term housing. Those veterans say the building has been neglected for years. Now, they’re worried about where they’re going to live.

Odds are you’ve driven by this rundown motel on Sandy Boulevard in Northeast Portland countless times, not realizing what’s behind the gates — and the closed doors. 

“I had the roof cave in on my head and it revealed so much black mold up there, it was just gross,” one veteran, David White, said.

After serving in the Army, struggling to find stability and suffering from chronic homelessness, White said he ended up in the complex called Sandy Studios on government aid. During his five years there, he’s had his fair share of horror stories — from water leaks and roaches to suffering with bed bugs.

“There’s been an ongoing pattern of neglect here. This is a veterans-only housing complex and I expect better,” White said. “They get paid $1,050 for a month of rent [per room]. And I want the people to know it’s being wasted here.” 

KOIN 6 News went to Sandy Studios to investigate this 50-unit complex.

Inside room 209, we found Army veteran Michael Flover, who was living in squalor without a working sink. When you turn on the faucet — water spews out the bottom and into a bucket because the plumbing is disconnected from the walls. When the bucket gets full, Flover said he pours the water into the bathtub to drain.

Online, these units are advertised as “studios” — but they aren’t apartments, they are 280-square-foot kitchen-less motel rooms, with veterans warming up whatever basic food they can.

“The rooms come with a microwave and we bought ourselves a toaster oven,” said Dawn Ward from room 111. “It’s hard to have a normal life here.”

With rent being more than $1,000 per room, these accommodations are a stark contrast to what you can get for the same price at other Portland apartments.

“It’s highway robbery if you ask me,” added Mike Hamilton from room 111. “I don’t know how they get away with it.”

The majority of the veterans at Sandy Studios are on HUD-VASH Vouchers to pay rent, which means taxpayers foot the majority of the bill.

Throughout the complex, vets showed evidence of months-long deferred maintenance, such as leaking pipes in the bathroom ceilings, missing drywall, dysfunctional doors and broken heaters, among a laundry list of other safety issues.

“I fought for this country and I shouldn’t be treated like this,” said Vietnam Vet Vernell Hall from room 117.

KOIN 6 News obtained reports from the city inspectors within Portland’s Bureau of Development Services, documenting serious code violations at the complex. The inspection reports confirm the roach and bed bug infestations, electrical hazards, mold and water leaks. Due to the neglect of building maintenance, the city declared Sandy Studios dangerous — ordering the property owner, 3800 Param LLC, to vacate the building by March 10.

“Our objective right now is making sure that the dangerous conditions are addressed,” said Ken Ray from the city’s Bureau of Development Services. “So, we’ll hold the owner accountable through fines and citations to get the building fixed.”

Inspection PDFs courtesy of the Bureau of Development Services

While the city, county and the nonprofit that manages Sandy Studios were all rushing to get the veterans into the Best Value Inn motel in March, KOIN 6 News went to the entities directly involved in managing this taxpayer-funded housing to get answers. That included the Joint Office of Homeless Services, the nonprofit organization and the property owner.

The Joint Office of Homeless Services (JOHS) is a city-county entity. The JOHS pays $640,000 a year to the nonprofit Do Good Multnomah to manage programs and day-to-day maintenance at Sandy Studios. Do Good has a master lease agreement with the property owner, 3800 Param LLC, to rent the rooms to chronically houseless veterans. The nonprofit uses federal and local tax dollars to pay the company a flat rate of $44,732 a month to rent the entire property, according to their master lease agreement.

Master Lease Agreement with 3800 NE Sandy Blvd
Master Lease Amendment with 3800 NE Sandy Blvd
Assignment of Leases

We sat down with Marc Jolin, the director of the JOHS, and showed him video KOIN 6 News captured of the conditions at Sandy Studios. When asked whether he had any idea of the state of the studios, he said he hadn’t seen any images like that.

“Before I had heard that there were significant issues with the water damage, but missing pipes and things like that — that was not anything that I was aware of,” he explained.

Do Good advertises on their website that they provide a litany of social services — and that Sandy Studios is a safe, supportive housing complex for disabled veterans. Yet in reality, KOIN 6 News discovered all these senior veterans are living in squalor inside a dangerous building.

“How do you explain that and how do you expect the public to trust that you are taking care of our people and our money?” KOIN 6 Reporter Elise Haas asked.

“As we get through this process of getting folks out as quickly as possible, then we’re going to have to come back around and understand what it was that happened here in this particular instance and what we need to take away, what we need to learn from that,” Jolin answered.

Do Good Multnomah is the nonprofit onsite which runs the social service programs and day-to-day maintenance at Sandy Studios. According to Chris Aiosa, the executive director of Do Good Multnomah, the maintenance company he subcontracts, Home First Development, is able to fix the smaller issues nine out of 10 times.

“The outliers are the individuals that when maintenance shows up, they’re not allowed in their units for whatever reason,” he claimed. “And then after time after time after time — the maintenance, will just say, ‘OK, this individual does not want us into their unit.’”

However, Aiosa said the property owner neglected all of the major capital expenditures and maintenance issues the nonprofit brought to their attention at Sandy Studios, like the deteriorating roof, water damage and electrical hazards the city found in their recent reports.

“We’ve involved the city, the County, the Joint Office, Bureau of Development Services, everybody,” Aiosa said. “I’m going to say it’s frustrating and that’s, as far as I will go and say on camera. The veterans deserve better.”

In addition to hazards with the building, Aiosa said VA social workers made fewer in-person visits during the pandemic, which compounded veterans health problems.

“Trying to do the job for the VA, that is difficult in itself,” he said. “And then coupled with individuals with severe and persistent mental illness, addiction issues and all the other things — it’s a challenge, which we’re up for, but being the last person holding onto the baton is tough to take.”

On Do Good’s website, their mission statement says they “support veteran-centered communities that inspire dignity, sustainability and purpose.” 

Sandy Studios was promoted as permanent supportive housing for veterans, advertising that veterans are provided case management, mental health assistance, social services, food programs, life skills programs, yoga, addiction counseling and community support.

But all these services are voluntary participation. 

“An individual can make a choice to engage with a case manager, but they are not required to,” Aiosa explained.

Do Good started running Sandy Studios over halfway through the city’s initial 5-year contract with the motel property owner.

Cascadia Behavioral Health was the original nonprofit that signed an agreement to run Sandy Studios, but the Joint Office asked Do Good to replace them. Cascadia’s spokesperson declined an interview.

The JOHS inherited Sandy Studios into their portfolio after the city and county joined forces in 2016.

However, Aiosa believes the veterans should have never been placed there to begin with.

“When you take an old rundown motel that is not setting up individuals for success, this is what’s going to happen,” Aiosa said. “And this is exactly what happened.”

He said the motel model makes it more likely for addicts to isolate and to leave people to their own devices.

So — why did the nonprofit agree to signing onto this motel?

“I get really emotional about this,” Aiosa said, with tears in his eyes. “I’m a veteran — and the idea that veterans should be houseless or homeless is unfathomable to me. I was hopeful that if I had the opportunity to take over this program, [I could] help support veterans and then eventually move them into something more appropriate.”

The veterans are worried they’ll be stuck in the Best Value Inn for longer than they bargained for. But the city, county and the United States Department of Veterans Affairs stress that they are working around the clock to find the remaining 30 veterans new permanent housing. 

Aiosa hopes to get the veterans into homes his nonprofit is currently building. However, those homes will not be finished for nearly a year.

In terms of what needs to change, Aiosa said he thinks it starts with the “intentionality of the building.”

“All of our new developments are extremely intentional about community space opportunities for folks to engage with the staff, to engage with other community members,” Aiosa said.

The property owner is known for being budget hoteliers. The president of the company, Ganesh Sonpatki declined an interview, but said he has submitted permits to the City of Portland to address the code violations.

In a statement, he said, in part: “Param Hotel Group will continue to work closely with the City of Portland and repair and renovations contractors. We regret the inconvenience our veteran tenants have endured through the building challenges and resolve to support them during their housing transition.”

Although Do Good and the JOHS won’t be renewing their lease with 3800 Param LLC at Sandy Studios, Sonpatki said he intends to reopen the building once again as 50 affordable housing units after the repairs are made.

“He’s actually somebody who we have other partnerships with,” Jolin said, referring to Sonpatki. “He has other motels.”

Banfield Value Inn room block agreement
Portland Value Inn 82nd room block agreement
Portland Value Inn Barbur room block agreement

According to lease agreements, KOIN 6 News learned the Joint Office partners with others of Sonpatki’s companies on four other motels to house the homeless amid the pandemic. Denis Theriault with the JOHS stressed that these are block room agreements — which are different than the master lease agreement they had for Sandy Studios, giving county maintenance crews more access to the properties and the people being housed.

KOIN 6 News pressed city and county officials on if they’ll continue to contract with Sonpatki’s companies for homeless services.

“Once we sort out who has the responsibilities in this particular situation, that’s something we have to reevaluate,” Jolin said. 

The 5-year master lease agreement at Sandy Studios alone has earned 3800 Param LLC more than $2.5 million in taxpayer dollars. 

“This is a colossal waste,” White said. “This is a problem for the American taxpayer.” 

Since his ceiling caved in January, White was relocated to a real apartment — something he hopes other veterans he bonded with at Sandy Studios will have one day.

“I want them to have a normal place with a kitchen and a bedroom,” he said, while holding back tears. “I don’t think they’ve known anything different, a lot of them came off the streets.”

However, after living through the rise and fall of Sandy Studios and witnessing the disfunction, property neglect, and drug addiction firsthand, White said there needs to be more accountability for all involved, including the veterans, by requiring residents to maintain a safe space, participate in social services, and sober up.

“If they’re receiving this much government aid, there should be strings attached,” White said.

Moving forward, White wants the city, the county, the VA, the Housing Authority of Portland and Do Good Multnomah to do better — and never let publicly-funded housing like this happen again.