San Diego is eager to see an overhaul to the federal formula that doles out money to cities to combat homelessness – the current setup gives more money to cities that have smaller homeless populations than San Diego. But at least three cities that benefit from the current arrangement – Chicago, New York and Philadelphia – don’t want it to change, and are vigorously opposing the plans, saying the effort would cost them millions of dollars, federal records show.
For more than a year, San Diego Rep. Scott Peters has led the charge to revise Department of Housing and Urban Development standards that would help San Diego receive the kind of funding that city and county officials believe it should receive, based on its homeless population. Peters first approached HUD about revising the formula in 2013, after Voice of San Diego revealed that cities with far smaller homeless populations received far more funding.
San Diego’s homeless population is the fourth largest in the country but ranks 22nd in Continuum of Care funding – the system by which the federal government doles out money to cities or regions – according to the 2015 Annual Homeless Assessment Report to Congress.
But under new regulatory plans being considered by HUD, San Diego may receive as much as $3 million more in funding for homeless programs to serve 8,700 people, justifying its ranking among the top U.S. cities. The $13.3 million San Diego received in 2015 would be increased to $16.6 million under the proposal.
“I know that matching the resources with the need should be a priority for everyone. I think something is wrong with the formula that now exists. I think most people get that,” Peters said in an interview. “We want a firm opportunity and a fair shake, that’s all.”
But other cities are upset, saying proposals considered by HUD may drastically reduce their funding. Their objections raise an uncomfortable truth: Without an increase in funding, any changes to boost cities with larger homeless populations likely means taking money from others.
Chicago officials, in particular, have been vocal in their opposition, with their displeasure expressed by government officials, homeless program advocates, university and church leaders, saying the plans would upset their strategic planning and reverse advances they have made to combat homelessness, according to records filed with HUD. Chicago, the nation’s third-largest city, has a homeless population ranked ninth in the U.S.
HUD’s proposals may result in a “shattering $22 million – approximately 50% – reduction in Chicago’s Preliminary Pro Rata Need (PPRN) for Continuum of Care funding” for the homeless, Maura McCauley, director of Chicago’s Department of Family and Support Services, wrote to the agency.
“While the detailed impact of this loss on Chicago’s Annual Renewal Demand is unclear, the potential is devastating and could reverse years of advances against homelessness in Chicago,” McCauley wrote.
Jackie Edens, executive director of The Inner Voice, a Chicago agency that helps homeless people find shelter, said she’s worried that her organization may be forced to shut down because of any large-scale funding cuts.
“Every stride we have made to help the homeless people would be set back,” Edens said. “This is like something out of fiction, really bad fiction. It’s going to be devastating.”
“San Diego and the other cities, we feel their pain and don’t want to wish them any harm, but there needs to be more money,” she added. “We have a big problem, it’s starting to get cold and snow and we have people living in tents. With no money, there’s gnashing of the teeth.”
The CEO of Chicago’s The University of Illinois Hospital and Health Sciences System, a 495-bed public hospital, said it successfully launched a pilot program to house 25 people who have been known to frequent emergency departments on many occasions. That program would be jeopardized by the loss of funds, Avijit Ghosh, wrote to HUD.
“Many former residents would again become homeless, exacerbating their multiple chronic health conditions and reoccurring behavioral health disorders that have been stabilized due to housing,” Ghosh wrote. “The impact on the health care system and cost to the state’s Medicaid program would be astronomical,” he said.
New York and Philadelphia officials also expressed dismay over the HUD proposals.
“Changing the formula,” wrote Laura D. Mascuch, executive director of the Supportive Housing Network of New York, “would be a national disaster of unprecedented proportions.” Supporting Housing Network of New York includes 200 member agencies that operate and building supportive housing to end chronic homelessness. The assessment report showed that New York has the highest homeless rate in the country, with 75,323 people.
In Philadelphia, Nicole Drake, director for Women Against Abuse agency in the city, said officials have “serious concerns” about any of the formulas considered by HUD. “Each formula would result in a significant decrease in funding” to the city, she wrote. Although Philadelphia is not among the top 10 U.S. cities in the number of homeless people, the city ranks sixth among communities of homeless people having families and children.
Questions About What’s Ahead
The impact of cities’ reaction to the overall HUD planning for homeless funding remains to be seen because the long regulatory process is not yet over.
In arguing for the change, San Diego officials said the current Continuum of Care program was limited by an antiquated formula that emphasized pre-1940s housing stock and population growth lag, based on an analytic examination of factors connected to homelessness.
HUD is now considering at least four replacement options, which take into account a number of other indicators San Diego officials say determine a city’s need for the homeless population, including poverty and the availability and affordability of housing, and the number of rental units. A public 60-day comment period ended in September, which HUD is reviewing.
Nearly everyone involved agrees that the process of evaluating different funding scenarios has been complex, and subject to much disagreement. While San Diego is satisfied with the formulas being explored, others find shortfalls. For instance, in all the proposed formulas, poverty and population were evaluated, Chicago officials said, but overcrowding in housing that could lead to potential homelessness was not fully explored.
Although HUD has not yet completed its review of potential new funding options, comments made by San Diego, Los Angeles and other California and western officials favor a formula plan known as D, according to a partial review of statements made to HUD. The other plans were labeled A, B and C.
San Diego would get more funds under each of four formulas being considered.
In a letter to HUD, Peters and Rep. Susan Davis acknowledged a concern San Diego has on the impact of its plans on other communities. “As HUD noted in the proposed rule, a change in the formula may result in the loss of CoC funding for some communities,” they said.
“To minimize this loss and ensure that cities with the greatest need are receiving the appropriate share of funding, the San Diego (Regional Consortium of Care Council) applied their research to the ten cities with the highest rates of homelessness.”
Rick Gentry, president of the San Diego Housing Commission and a member of the San Diego Regional Continuum of Care Council, said in a letter to HUD that the city proposed another formula, E, to “more equitably distribute” funds.
That formula was based on a San Diego study on the region’s experience with homelessness and the high cost of housing and also San Diego’s research on top 10 cities in the U.S. with the highest rates of homelessness. The analyses selected a combination of weighted factors involving housing and need. Under that scenario, San Diego would receive $19.5 million, a $6.1 million increase.
HUD officials said they would not consider the regulations until after the new administration of President-elect Donald Trump takes office in January. Peters acknowledges there may be further uncertainty regarding the proposals with Trump and his pick to head HUD, Ben Carson, a neurosurgeon with no experience in government.
Peters expressed confidence, however, and said he would anticipate discussing the regulations process with the new leadership.
While a reversal of the HUD regulatory process appears unlikely under Trump, agency officials are reluctant to say what may happen next.
“I can’t crystal ball future regulatory action by an administration that hasn’t assumed office yet and articulated their vision for HUD programs,” HUD spokesman Brian Sullivan said Friday.
In the meantime, cities across the country wait, fingers crossed. Peters, too.
“This congressman should get his money, but it should not be at the expense of other localities’ programs,” Chicago’s Edens said of Peters. “It should not be at anybody else’s expense. I don’t begrudge him getting what he thinks it’s needed for his jurisdiction, not one iota. But tell (HUD) to put more money into the pot and he can have what he wants.”
Says Peters: “I am hoping we have an analytical approach and have the right answer for homelessness across the country. I’m not trying to be greedy.”