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San Francisco may get a new Boys & Girls Club as part of a novel settlement with the owners of four housing complexes in the Bayview-Hunters Point area sued over alleged code violations. The deal still needs city approval. But City Attorney Dennis Herrera billed the potential agreement Monday as a more creative and constructive resolution than the city could reach through trial, and Patti Shwayder, senior vice president for Apartment Investment and Management Co., largely agreed. “We could easily have been in legal maneuvers for years,” but decided investing in the troubled neighborhood, where the company runs 604 federally subsidized units, would be a better use of money, Shwayder said. When the city sued AIMCO in January 2002, it alleged that the Denver-based company was violating state and local codes, and had failed “over a long period of time” to comply with numerous orders from the city’s Department of Building Inspection. Seeking injunctive relief, abatements and unspecified civil penalties, the city put forth a litany of alleged violations at the All Hallows, Bayview, Shoreview and Lasalle apartments, from deteriorated wood to missing smoke detectors, and mold and mildew on walls and ceilings. AIMCO fought back with a countersuit in 2003, accusing the city of “using the Department of Building Inspection to initiate an assault of violations on the apartments” in order to drive the building owners out of town. The company alleged the city was trying to force a change of ownership to local nonprofits because it feared AIMCO would convert its 604 units to market-rate housing. Both sides deny any wrongdoing in the proposed deal submitted to the Board of Supervisors on Monday. But under the agreement, AIMCO would give $1 million toward a new Boys & Girls Club, which would also include an office for the San Francisco Police Department. The company, which Shwayder said plans a “significant remodel” that’s likely to cost upwards of $30 million, would also pay $2 million to a settlement fund controlled by the city to cover fees for permits if the project proceeds. If the company were to abandon the project, the city would keep the $2 million, Shwayder added. If AIMCO secures certain tax-advantaged financing for the renovation, it would give the city an additional $500,000, according to the city attorney’s office. Bingham McCutchen partners James Hunt and Michael Begert took the lead in representing AIMCO. While Shwayder said AIMCO proposed a police facility, she credited the city with coming up with the youth facility. Deputy City Attorney Rose-Ellen Heinz Fairgrieve, one of the lawyers who worked on the cases, said the city thought the club would be an “enduring” way to address public safety concerns, adding that a similar clubhouse in the Mission neighborhood has a well-regarded gang-prevention program. “The real victors here are the residents,” Herrera said Monday. But a settlement in San Francisco v. Apartment Investment and Management, 404010, won’t necessarily end AIMCO’s legal battles over the complexes. Some residents still have suits pending against the company, though Shwayder says many such suits have already been dismissed. For example, Victor Marquez of the Marquez Law Group in San Francisco represents 25 families who have either served demand letters or sued AIMCO; four of those cases are scheduled for trial next year, he said.

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