Homeless Assistance Grants, FY23 Funding

U.S. Senate bill: not introduced, bill number not assigned — FY23 Transportation-Housing and Urban Development Appropriations Bill

Committees:

Senate Committee on Appropriations

Status:

A draft of the Senate Transportation-Housing and Urban Development Appropriations Bill has been released.

Cosponsors:

0 (see all cosponsors)

Appropriations bills are traditionally not co-sponsored.  

U.S. House bill: H.R. 8294 — FY23 Transportation-Housing and Urban Development Appropriations Bill

Committees:

House Committee on Appropriations

Status:

The House Transportation-Housing and Urban Development Appropriations Subcommittee has been marked up and passed by the House.

Cosponsors:

0 (see all cosponsors)

Appropriations bills are traditionally not co-sponsored.  

Impact

The Alliance strongly supports the Administration’s request to increase funding for Homelessness Assistance Grants in FY23 to $3.6B: “To prevent and reduce homelessness, the Budget provides $3.6 billion, an increase of $580 million over the 2021 enacted level, for Homeless Assistance Grants to meet renewal needs and expand assistance to nearly 25,000 additional households, including survivors of domestic violence and homeless youth.”

Homelessness Challenges: Why Homelessness Assistance Grants Should be Funded in FY23 at $3.6B

Increase in homelessness: While homelessness decreased between 2007 and 2020 by 10%, it increased slightly every year between 2016 and 2020. The Point in Time count that typically takes place in January (and is the only enumeration that includes people who are unsheltered as well as sheltered) was not fully conducted in 2021 due to the pandemic.  Prior to COVID, HUD reported that more than 580K people experienced homelessness on a single night in January 2020.  Three-fifths were in sheltered locations and two-fifths were unsheltered. 

Increase in unsheltered homelessness: More single individuals experiencing homelessness were unsheltered than sheltered and there were more people in families living unsheltered than the year prior.  The unsheltered population of 230,000 includes people with behavioral health problems; youth and young adults; pregnant women and families living in cars or tents; older adults whose needs can no longer be met in shelter and end up on the street. 

People who are unsheltered have much more serious health problems than people living in shelter.  One-half of unsheltered people are tri-morbid, with physical, mental and substance use illnesses, while only 2 percent of sheltered adults are tri-morbid.  And many of these unsheltered people did not become homeless because of tri-morbidity, but the reverse–they became seriously ill because they were unsheltered.

Rental inflation: Average rents shot up by almost 15% in 2021, to $1,877 a month–some cities, including New York, Miami, and Austin experienced increases of as much as 40%–and it’s believed that rents will likely increase by a comparable number in 2022.  Rents are the biggest cost item in homelessness programs.  Moreover, when affordable and available units become scarce, landlords have more discretion to discriminate against renting units to people who have experienced homelessness, which drives up housing navigation costs.   

Need to re-think shelters: The number of shelter beds significantly decreased as shelters followed government guidance to “decompress”; and though many people from shelters and unsheltered locations were placed in motel/hotel rooms for quarantine and isolation, those incremental beds did not make up for those lost through decompression. It should be noted that since many jurisdictions are now releasing their hotel/motel beds, but likely maintaining COVID protocols for social distancing in shelter, the number of beds may continue to be low.  Moreover, many unsheltered people are reluctant to enter congregate shelters because of the absence of privacy and their proximity to people with behavioral issues.   Many communities might argue they need significant numbers of new non-congregate shelter spaces. 

Recruitment and retention of staff:  Our surveys show consistent reports of employee shortages in homeless service and housing organizations. In a May 2021 survey, 72% of CoCs reported shortages in frontline shelter staff; 69% had a shortage of case managers; and 62% had shortages in street outreach workers. Organizations reported the cause of the challenges as being stress, exhaustion, and low morale; illness; family responsibilities; and fear of COVID.  Inability to retain staff is a big reason why some COVID funding went unspent or was spent slowly. 

Low pay may be another reason that it is difficult to keep staff.  Homeless services staff typically receive relatively low salaries for very difficult and challenging work. A recent study found that the average shelter staff earned $24,000 per year, and the average PSH staff earned $36,000 per year.  If we want providers to be fully staffed with dedicated professionals, then they need more resources to recruit and retain. 

Partnerships for health care’s supportive housing services: Chronic homelessness is growing, but the number of PSH units has declined two years in a row.  Housing vouchers as well as the emergency housing vouchers don’t come with services.  In many states, Medicaid offers supportive housing services which are often needed to keep people with acute needs safely and securely housed (finding a rental, landlord intervention, and case management), but many providers lack the capacity to bill for such services.  Enhancing that capacity and developing the necessary partnerships often requires money. 

Partnerships for employment: Many people experiencing homelessness either are working or were recently working and could maximize their chances of becoming housed and staying housed with employment services.  Homelessness is a very temporary state for most people: 30% of people who become homeless have exited homelessness after 2 weeks, and 85% have exited after 6 months, with a median spell of homelessness being 6 weeks. 45% of people experiencing homelessness are working, albeit for very low wages. 

Employment not only should be but IS the major way that people exit homelessness. We hear constantly about staff shortages in a host of public, nonprofit and private entities, for positions that require no or limited specialized skills or training. Local homelessness systems could partner with such entities to link clients to employment and help them exit homelessness faster.  But developing the necessary relationships often requires money for staffing. 

Homelessness Solutions: Why Homelessness Assistance Grants Should be Funded in FY23 at $3.6B

COVID Relief Has Worked: COVID reminded us of the importance of housing, amidst an affordable housing shortage of 6.8 million rental units available and affordable to extremely low-income households.  Thanks to often bipartisan Congressional efforts, we were also reminded of the capacity of the federal government to mitigate against the consequences of that shortage.  Rental assistance allowed countless households to avoid eviction.  Many people experiencing homelessness, particularly those with vulnerable conditions, were brought inside to non-congregate shelters as well as motels/hotels, defying predictions that COVID would disproportionately impact homeless families and individuals because of their compromised health.  And many communities used COVID relief to place homeless households into permanent housing. 

Veterans Homelessness Programs Show Us What Works: We know what we need to do to end homelessness, we just need to adequately resource local homelessness systems.  We’ve seen how veteran homelessness programs, particularly the highly praised HUD-VASH and Supportive Services for Veterans Families (SSVF) programs, have reduced homelessness among veterans by almost 50 percent.  HUD-VASH and SSVF programs are based on HUD’s PSH and RRH programs, but there are two big differences—the VA programs are better funded per capita and they are integrated into a world-class health care network. 

Too Much Inflow: Despite the extent of homelessness in California, some of the best homelessness programs in the nation operate in the Golden State.  But for every two people housed in Los Angeles or San Francisco, three people become homeless.  Homeless programs in California and across the nation find it difficult to keep up with the inflow.  We’re missing millions of affordable homes because of NIMBYism, among other factors.  Rents consistently exceed wages, often by leaps and bounds.  We have a federal housing voucher program that works well, but which is resourced for only one-quarter of the eligible households.  The number of people with mental illness and substance use issues far exceed the capacity of treatment programs.  Hundreds of thousands of people are released from prisons and hospitals every year with few housing and employment prospects.  We shouldn’t expect modestly resourced local homelessness systems make up for the failures of so many other systems. 

Correcting Racial Inequities: In robustly funding the fight against homelessness, Congress is also addressing the racial disparities caused by historic discrimination in housing, lending, and law enforcement, among other systems.  The 2020 Census reported that Black people represent 12% of the population, but 39% of homeless people. Similarly, Native Americans represent 1% of the population but 3% of homeless people; Hispanic/Latino people represent 18% of the population but 22% of homeless people; and Pacific Islanders represent 0.2% of the population but 1.5% of homeless people.

CoC Funding Works: CoC funding is distributed pursuant to an exhausting and exhaustive annual competition process, requires less paperwork, goes directly to homelessness systems, provides a very basic benefit to the very poor, and is administered by a workforce that proved its extraordinary dedication and competence during COVID.

Summary

The House-passed Transportation and Housing and Urban Development (THUD) Appropriations Bill included funding for Homeless Assistance Grants (HAG) at $3.6B, while the Senate version of that legislation set funding at $3.5B.  However, there’s a long way to go in the appropriations process.  

HAG, which fund efforts to prevent and reduce homelessness in communities across the nation, is the federal government’s most important homelessness program. HAG, which is funded through the annual THUD Bill, consists of Continuum of Care (CoC) and Emergency Solutions Grants (ESG) funds.

The CoC funds are awarded to communities pursuant to an annual competition process, which rewards communities that spend these valuable dollars cost-effectively. CoC funds can be used to pay for
1) permanent supportive housing (PSH), which combines rental subsidies without a designated length of stay with supportive services for households with at least one person with acute needs, e.g., mental illness, physical illness, or substance use;
2) rapid re-housing (RRH), which provides households with short term (up to 3 months) or medium term (up to 24 months) rental assistance along with lower levels of services;
3) transitional housing (TH), which is intended to slowly transition households, usually certain subpopulations like people recovering from addictions, into independent living or if needed into PSH or RRH over 24 months;
4) street outreach, which identifies and assists people experiencing unsheltered homelessness, connecting them to services on a voluntary basis; and
5) homeless management information systems (HMIS), which allows communities to identify people experiencing homelessness and keep track of their progress towards housing.

For FY20, FY21, and FY22, CoC funding was funded at “no less than” $2.35B, $2.6B, and $2.8B, respectively. The FY23 budget request for CoC funding is “no less than $3.19B.

ESG funds, which are awarded by formula to states, metropolitan cities, and urban counties, can be used for RRH, street outreach, HMIS, shelters, and prevention (which are housing relocation and stabilization services, and short- and/or medium-term rental assistance, that are necessary to prevent people from becoming homeless). For the previous three fiscal years, ESG has been funded at “no less than” $290M. The FY23 budget request for ESG funding is “no less than $290M”.

HAG Funding  President  House  Senate   Enacted
FY20                  $2.60B     $2.80B  $2.76B  $2.78B
FY21                   $2.78B      $3.41B   $2.95B  $3.00B
FY22                   $3.50B    $3.42B   $3.26B  $3.21B
FY23                   $3.57B      $3.6B     $3.5B
NAEH is asking Congress to set funding for HAG in FY23 at not less than $3.6 billion.

Why is homelessness increasing in recent years after several years of marked declines? As the FY23 Budget reminds us, “The increase is a result of the rising cost of housing and the lack of assistance provided to segments of the homeless population. For veterans and families experiencing homelessness, investments in permanent supportive housing and rapid re-housing have helped reduce homelessness, even as housing costs in most of the country for low-income people have risen dramatically. In partnership, HUD and VA have invested significant resources, including HUD-Veterans Affairs Supportive Housing (HUD-VASH), to reduce veteran homelessness, which has led to a decline of veteran’s homelessness by half since 2011. A similar decline (32 percent) has occurred for families with children experiencing homelessness. On average, much less assistance is provided to individuals who are not veterans or accompanied by children. As a result, rising numbers are experiencing homelessness and particularly unsheltered homelessness.” (Emphasis added)

Did your Representative sign on to the bipartisan letter in support of $3.6B for homelessness in FY23?

FY23 McKinney Vento Homeless Assistance Grants Letter - finalized

Did your Senator sign on to the bipartisan letter in support of $3.6B for homelessness in FY23?

FINAL FY23 Homeless Assistance Grants Letter to THUD

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