The Vice Hotel

One of the largest city-funded Care Not Cash hotels was allegedly run as a home for extortion, drug dealing, and other vices

Mendoza, for his part, said that they have nothing to fear and denies that he's been involved in threats of violence.

Meanwhile, social service workers and employees of nonprofit agencies are afraid that if they were to speak on the record, they could suffer repercussions from Shaw, who they believe wields considerable power in city political circles. They also believe that Shaw receives favorable treatment from the city agencies that oversee the $15 million in government grants and contract payments that fund THC's management of subsidized hotels.

This view seems to be supported by the fact that, despite several requests, I was unable to obtain interviews with Department of Human Services employees who supervise contracts with THC. Instead, an assistant to department director Trent Rhorer's assistant told me Rhorer said I should "talk to Randy" about the situation at the Mission Hotel.

One of 248 rooms at the largest hotel of 15 that THC leases with taxpayer subsidies.
Jake Poehls
One of 248 rooms at the largest hotel of 15 that THC leases with taxpayer subsidies.
A typical Mission Hotel residence.
Jake Poehls
A typical Mission Hotel residence.

Former employees were asked to sign confidentiality agreements with the implied promise that they would not speak out about the situation at the Mission Hotel, people with direct knowledge of the situation say.

In this spirit of secrecy, Shaw did not respond directly to e-mail and voicemail requests to be interviewed for this story. He did respond indirectly. Last week, he wrote a column titled "SF Weekly Preparing New Attack on Housing Clinic" for Beyond Chron, a Web site run by his nonprofit.

Defending his organization, Shaw wrote that Mendoza was a competent employee who merely left due to personal problems. "We are extremely proud of our management of the Mission over the years. Rather than wait for Smith to misinform the public, we're setting the record straight," Shaw wrote, in anticipation of this column. "After we hired Carlos Mendoza as general manager in February 2004, the Mission became a much calmer environment."

These smooth waters became choppy last fall, when "Carlos reported to us that he was going through some personal problems," Shaw continued. "Carlos' personal issues soon triggered concerns about his relationship with a couple of the hotel's tenants. An investigation was conducted, and for some time there was not sufficient evidence to conclude that Carlos should be terminated. When that evidence emerged in July 2007, Carlos was removed from his post and his employment ended."

Mendoza says the "personal problem" allegations, in which he was said to have had an affair with a tenant, are false, and that he resigned because he thought he was being unfairly accused.

Shaw's public spin on the Mission Hotel situation contrasts sharply with THC's own court filings requesting restraining orders against Mendoza.

Mendoza "continues to stalk and threaten employees. He continues to threaten and extort tenants," according to requests for restraining orders filed by a THC attorney. According to the filing, Mendoza was furious that some employees had ratted him out.

Fox, THC's lawyer, was scheduled to appear Sept. 5 in court to explain Mendoza's alleged criminal activities. I had hoped to see an illuminating description of life inside one of the city's largest poorhouses.

Not long before this hearing date, a copy of the filing appeared on a blog run by Jeff Webb, a resident of the THC-run Seneca Hotel. Webb's blog item was then picked up by two other San Francisco–based blogs. Fox subsequently asked the court to postpone the THC–Carlos Mendoza hearing until Sept. 21. Neither she nor Mendoza showed up for the second date. Mendoza says he was not served with notices to appear.

Whatever the truth of the allegations in the restraining order requests, sources allege that THC's reputed "Vice Hotel" was a well-oiled machine. Drug dealing was the most visible illicit activity, according to residents, former residents, and employees.

"I got myself into the money-loaning business," said a source who recently moved out of the Mission Hotel. "[Users would] buy drugs from [a dealer] and when they ran out, they'd borrow money from me. It got to the point where [the dealer] had something resembling a Glide Memorial Church bread line every third of the month. This ran all night. I asked, 'How in the hell are you getting away with this shit, and nobody's going to jail?' He tells me, 'You can conduct any business you like in here, as long as you pay rent.' I said, 'But I'm on General Assistance; they pay my rent.' He said, 'No, as long as you pay rent.'"

"Rent," this source said, meant payments to the hotel manager.

Another tenant I spoke to also said Mendoza would warn the aforementioned dealer of the police's presence. "Carlos would go to his door, give him a soda, and say, 'You've got to slow down the traffic tonight,'" said the tenant, who claims to buy drugs from this dealer.

Since Mendoza left, however, the dealer "has not slowed down his dealing. He's still selling crack. I bought some last week, and it made my chest hurt," said the tenant, adding that at least six other occupants currently deal crack from their rooms. "There's no secret. It's done on the stairway. You can see people coming in and out."

Not everyone in the hotel welcomes the drug trade. Combined with the prostitution that several residents said went on in bathrooms and elsewhere in the hotel, the trafficking created a menacing atmosphere.

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