San Diego nonprofits running federally subsidized transitional housing programs for the homeless are getting a clear message: Switch to a new model or risk losing cash.

Now many nonprofits are rushing to create programs so they don’t lose money as the federal government moves toward funding permanent housing efforts that experts have declared most effective.

Other nonprofits have already gotten bad news. One is Interfaith Community Services, which learned earlier this year that 11 apartments that have housed homeless families for more than two decades were cut from the region’s funding wish list.

Instead, the region’s latest application for federal Department of Housing and Urban Development money proposes reallocating more than $2 million from transitional housing projects across San Diego County to new approaches garnering more federal support. Another $2 million proposed to bankroll similar programs isn’t guaranteed to come in.

The shift places about a dozen local nonprofits at a crossroads. The increased emphasis on the so-called housing first model, which prioritizes getting homeless people housed quickly rather than focusing on months- or years-long interventions first, is forcing both large agencies such as Father Joe’s Villages and smaller ones like El Cajon-based Crisis House to try new approaches.

This year’s HUD funding application demands that regions nationwide give funding priority to permanent supportive housing, which focus on getting chronically homeless people quickly housed and then provide continuous support,and rapid rehousing projects that help clients find housing, assist with moving costs and provide other temporary services.

New transitional housing proposals aren’t allowed in the latest HUD solicitation, and HUD’s funding formula means many existing ones don’t fare as well.

San Diego’s Regional Continuum of Care Council, the countywide group that decides on local programs that’ll compete for federal funds, turned in an application last month that nixed seven current projects and proposed reduced funding for another. It expects to learn early next year which new and existing programs will get federal backing.

City Councilman Todd Gloria, who chairs the regional council, said HUD’s latest application requirements and federal goals to end homelessness forced the group to grade nonprofits’ programs and decide whether they could effectively compete for HUD funding.

The HUD dollars San Diego’s historically received don’t match its need and the region must use the dollars it does get as efficiently as possible, Gloria said.

“The focus has to be on needing this program,” Gloria said. “It can’t be on continuing legacy programs because that’s the way it’s always been.”

Some of the nonprofits suggested changes themselves.

Father Joe’s Villages walked away from two transitional housing consortiums that included more than a half-dozen other nonprofits, leading the others to grapple with the future of their programs, too.

Bill Bolstad, chief development officer for Father Joe’s Villages, said the decision came down to numbers: Only 42 percent to 49 percent of participants who left the Father Joe’s programs tied to the consortiums ended up in permanent housing in 2014, figures the nonprofit expected would be scrutinized in a new grant application.

“We were not happy with these results so were eager to make a change when we had the opportunity,” Bolstad said.

Many of the groups are now seeking cash for new projects that better match the federal agenda. Most, including Father Joe’s, are pitching rapid rehousing programs.

Funders Together to End Homelessness San Diego, a regional group of philanthropists focused on the cause, has agreed to provide about $150,000 in grant funding to help two of the nonprofits – Volunteers of America and Crisis House – make the switch.

Another nonprofit, Interfaith Community Services, is weighing whether private dollars can sustain 11 apartments that have temporarily housed homeless families for about 25 years.

“One of the tough realities of reallocating resources and creating system change is that tough choices are being made,” said Greg Anglea, Interfaith’s executive director.

Interfaith, which also operates two HUD-funded permanent housing projects, isn’t among the groups proposing new programs in the latest funding application.

But even some of those who are proposing new projects worry certain populations could fall through the cracks without their current ones.

Martha Ranson, who oversees efforts to aid homeless women at Catholic Charities, said the end of the group’s formal work with the Father Joe’s Villages-led consortiums will translate into the loss of 20 transitional housing beds for women. Catholic Charities expects to add 10 new rapid rehousing units for women through a new program it’s proposing.

Ranson doesn’t think that’s enough. Many homeless women, particularly those over 50, have unique needs sometimes best served with transitional housing such as experience with domestic violence  or long-term addiction that make them more likely to fall in and out of programs, she said.

For that reason, Ranson said, it’s unfair to expect the same percentage of successful housing placements from programs that serve especially difficult populations. She believes women who struggle in her programs would also struggle in permanent housing.

“It’s somewhat devastating to think we’re all being lopped off because we haven’t been high-performing, because of this whole push to, ‘everyone should go to (permanent supportive) housing,’” Ranson said. “There is a place for transitional housing.”

Several homeless providers who spoke with Voice of San Diego believed some transitional housing programs remain vital.

The Salvation Army, which is set to lose funding for a 42-bed employment and housing program for single men, is committed to maintaining that project without HUD money, said Jessyca Carr, social service director for the group’s work in San Diego County.

“We want to be able to help people in the way that best suits their particular needs,” Carr said. “Everyone comes with a different challenge. Everyone comes with a different set of a needs.”

Yet Carr acknowledges homeless-serving nonprofits must place a greater emphasis on programs that follow new housing models if they want federal support. So her organization is seeking HUD money for a rapid rehousing program, too.

Lisa is a senior investigative reporter who digs into some of San Diego's biggest challenges including homelessness, city real estate debacles, the region's...

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