Gitch

“This is probably one of the little known facts about Bremerton Housing Authority,” says David Gitch, former chief of Harrison Medical Center who was asked to take the helm of BHA on an interim basis last December. “The face of Bremerton Housing Authority most of us know is represented by Westpark. And then, there is the rest of the story.”

The rest of the story began in 1999, when HUD decided to outsource its Section 8 Housing Assistance Payment contracts. The Bremerton Housing Authority has done similar work on a smaller scale since 1973. Bidding against big players like Seattle’s housing authority, the agency won contract administration for most of Washington state in 2000. After a successful start, the agency had to decide whether to stay small or expand, according to Clarence Nelson, director of Contract Management Services — a separate division eventually created by BHA.

“We developed a good reputation in Washington state,” he says. That’s why the agency was approached by a troubled housing development agency in Hawaii to become a subcontractor for HUD contracts, he says. A year later, CMS won two more contracts — one for Nevada and one for Utah.

“It’s a performance-based contract,” says Nancy Austin, CMS assistant director. “We’ve been able to deliver on the promises we’ve made, and that’s why we’re one of the top contract administrators in the country.”

Since taking the entrepreneurial path that has generated millions of dollars in income, the nonprofit public agency has grown from about 50 employees to 150. The majority of those work for CMS, which is located in the Norm Dicks Government Center in Bremerton. BHA owns the second floor of the building and leases the fifth floor.

CMS oversees 28,000 units, dealing with duties that range from disbursing monthly HUD assistance payments to building owners and processing contract renewals or terminations, to responding to residents’ health and safety concerns. CMS also has a small office with three to four employees in each state it administrates.

Part of its ability to have a successful back office is due to an investment into a computer network that has 97 percent to 100 percent of uptime, Nelson says. The comprehensive system, used for data and communications, also allows field personnel to instantly upload and download information and forms to their laptop computers. The system is integral to their work — considering that reports have to be sent out daily, and some tasks have as short a deadline as one hour.

In 2005, Contract Management Services processed and paid more than $91 million in housing assistance payments, and brought in $6.3 million in gross revenues. In a time of shrinking funding to housing authorities nationwide, BHA has found other ways to support its housing programs.

Nelson calls it the bottom double line. On one hand, the mission is to provide affordable housing, and on the other, find new ways to fund it. Nelson is familiar with affordable housing from personal experience: He grew up in public housing. In fact, he grew up in the same complex in Memphis as Elvis. In order for Bremerton to continue and expand its level of services, he says, the housing authority had to take a new approach. With plans to redevelop Westpark under way, the agency saw an opportunity to create income through performance-based contract management, he says.

After several years in the making, the plans for Westpark are moving ahead. Plans call for a $300 million renovation project that will demolish the existing 582 aging housing units — built as temporary Navy shipyard housing during World War II — with a pedestrian-friendly, mixed-use urban community that includes apartments, homes, retail space and an assisted living facility. The facility, called Firs II, had its groundbreaking last December and is the first phase, to be completed in March 2007. The rest of the work is estimated to be done in four phases.

The project is in the final design and vision development phase, following a series of meetings in May that included city planners, environmentalists, retailers, residents and others.

“If you went up there, it was a beehive of activity,” Gitch says.

Nelson sees the Westpark project as the biggest benefit from CMS — especially since it didn’t qualify for federal redevelopment funds.

“Contract administration has become a huge player in economic development in Bremerton,” Nelson says.

As much as the entrepreneurial efforts are unique for a bureaucratic agency in general, BHA is not like any other housing authority of its size either. Most of the 47 performance-based contract administrators in the country are state housing finance commissions. Only three are public housing authorities: Bremerton, Jefferson County, Ala., and Tampa, Fl.

“A lot of housing authorities really are realizing they missed a golden opportunity,” Nelson says.

For Bremerton, that opportunity doesn’t stop at contract administration. CMS hopes to take advantage of more subcontracting for other states that have been failing, as well as expand into training products.

The agency overall has had some reported troubled times last year, as the city of Bremerton looked into the possibility of folding it into the Kitsap Consolidated Housing Authority. City officials noted a growing rift over Westpark and a breakdown in communications. The merger failed by one Bremerton City Council vote, and the BHA Board of Commissioners asked longtime Executive Director Merrill Wallace to step down as it steers the agency in a new direction.

Asked about the merger talks, Gitch says the discussion is no longer relevant. “With that history in the past, the Bremerton Housing Authority can transition into looking at the future,” he says.

The future, according to Nelson, is to become a leading trainer nationwide. The training program, which “will be a huge source of revenue,” will be implemented as early as September. CMS has already designed it and researched the potential market. A similar training program is offered to its property owners for free, and this is an opportunity to build on that program while tapping into smaller markets that big training agencies won’t touch.

“I’m impressed how well they’re doing as an enterprise outside of Bremerton,” says David Porter, executive director of the Kitsap Economic Development Council. “It’s not just about Bremerton.”.