Community leaders around Marin are trying to do the right thing by making decisions to address the county’s systemic, historic lack of affordable housing.

Part of that pursuit needs to be paying close attention to results related to expensive programs involving public funds. Results (and the timetables to meet them) need to be tied to original agreements.

Recently, an ad hoc committee formed by the Larkspur City Council released a report illustrating concerns about the financial status of an apartment complex owned by a special housing authority.

The California Community Housing Authority used tax-exempt municipal bonds issued in 2019 to buy the property. Since then, the report shows a history of lower-than-expected revenue for property managers and higher-than-expected rents for middle-income residents.

The $226.5 million deal for the Serenity at Larkspur apartments was designed to create more affordable housing in the city, a mission that attracted Larkspur leaders and allowed CalCHA, as well as its property managers, to be exempt from property taxes — an exemption worth millions over the last five years.

The report not only shows that Serenity isn’t generating the revenue needed to safely cover the interest and ensure the property doesn’t slide into default, it also shows that it is not living up to its promise of increasing the housing supply for middle-income residents.

As of June, only 55.8% of Serenity renters were paying the lowered rents. Worse than that, the report stated that “non-program tenants enjoyed average annual rent discounts of $7,066 per unit, which was 43% higher than the $4,928 discount per unit for income qualified tenants.”

If it isn’t an elaborate ruse, then it is starting to look like nothing more than pie-in-the-sky wishful thinking that relies on cities desperate to earnestly address the housing crisis.

Larkspur officials should have sniffed it out sooner. They supposedly had a front-row seat. With the report finally out in public, the city needs to hold Serenity accountable. Without a believable plan to become profitable and get much closer to 100% of renters participating in the middle-income program, Larkspur should cut its losses and move on.

Considering that CalCHA is facing similar challenges with properties in Santa Rosa and Antioch, among other California locations, this may be a case for the state Auditor’s Office. The questions about the loss of public money are loud enough in Larkspur and elsewhere for a statewide response.

This is already a cautionary tale for all other Marin municipalities. Much like the backlash against government spending on the homelessness problem, we need to learn that responding to an obvious lack of results needs a quicker nip in the bud, not more time (and more bonds) before hoping results bloom.

Larkspur officials need to continue its newly strong response, learn where things went wrong and look for safer programs in the future. Doing so will set the right example.

Naturally, how the Larkspur City Council goes about protecting public money meant for residents while staying open to creative and fiscally responsible projects to promote middle-income housing will be instructive for others pursuing similar goals.