Homelessness--Same Issue, Two Very Different Stories

On Thursday, February 5, I participated in a town hall meeting on homelessness sponsored by the Encino Neighborhood Council. I summarized that meeting here. One of the most consistent messages from the Deputy Mayor and Councilmember Raman’s aide was the great success of Inside Safe. According to both city representatives, Inside Safe has been a wildly successful, albeit expensive program that has been the primary driver of the (unverifiable) reductions in homelessness since 2024. With expenditures exceeding $323 million, Inside Safe has supposedly housed 1,352 people, meaning the city has spent more than $239,000 per person housed. These costs seemed fine with the Deputy Mayor and Council Aide, who gushed about the robust services clients have received as they progress toward independent living. They took me to task for questioning Inside Safe’s costs and effectiveness in light of the City’s inability to produce dependable service statistics for its homelessness programs.

Two days after the town hall, Councilmember Monica Rodriguez had a very different opinion of Inside Safe and the City’s homelessness programs. A critic of the City’s massive expenditures on homelessness and its dearth of outcome-based measures, Rodriguez was quoted in the California Post, saying “We’re hemorrhaging money on a homelessness system that was never designed to succeed — and no one is being held accountable for the failure. If we really wanted to do something about this crisis, we would be advancing real oversight, demanding results, and shutting down programs that don’t work — not protecting a system that keeps spending more while delivering less”. I have contacted Rodriguez’s office to verify her comments but have not yet received confirmation. However, the statement is consistent with previous ones, like her response to the recent charges brought against the CEO of a nonprofit for fraud: “This case is yet another example of the enormous resources that have been wasted while
people remain unhoused and without help. This is indefensible and must end now.”

We are faced with a choice of whom to believe; Mayor Bass and Councilmember Raman, or Councilmember Rodriguez and other critics of the current system. Both make compelling rhetorical statements about homelessness programs, and both say they want to get people off the streets. We need to turn to the facts--at least the facts we can verify.

Let’s consider a statement made by the Deputy Mayor Vahid Khorsand during the town hall (video here). After I mentioned four audits that raised concerns about LAHSA’s cash handling and contract management. Mr. Khorsand said we shouldn’t get into “philosophical discussions” about audits. As I stated in my CityWatch column, there is nothing philosophical about an audit; audits are based on verifiable and undeniable facts. The Deputy Mayor’s statement was classic deflection; when presented with facts that he could not deny, he tried to redefine the discussion as one of differing philosophies instead of performance versus failure. This has been the strategy used by the City, County, and LAHSA for years, especially when faced with documented proof of failure. For example, when a blistering report from the LA County Auditor found that LAHSA was using restricted funds inappropriately, (Finding #5), LAHSA’s management denied it but then said it was giving managers training so it wouldn’t happen again. Management also leaned heavily on the COVID pandemic as a reason for circumventing standard financial and contractual controls, but as the Auditor pointed out, the audit covered years both before and after the pandemic.

Again, when the Deputy Mayor and Councilmember Raman’ aide boasted about increases in sheltering and housing homeless people, I mentioned audits from HUD and the LA City Controller that showed many clients were counted more than once in a plethora of siloed programs that do not share data. As described in an LA Times article, during court testimony on January 15, Matt Szabo, the city’s Chief Administrative Officer, could not verify the number of available beds in city-financed shelters. There is nothing “philosophical” about whether or not a bed exists for a person seeking shelter--it either does or doesn’t.

The costs and performance of city homelessness programs should not be the subject of a philosophical debate; they should be subjected to the same rigorous review as any other program. In a February 3 report to the City Council, the CAO reported the average cost of an Inside Safe room is $225.81 per night, or $82,421 per year, far more than the average of $31,527 per year for other interim housing beds, (pp 7-8). The high costs are attributed to a robust menu of support services provided to Inside Safe clients. But as a report from audit firm Alvarez & Marsal (A&M) detailed, neither the City, County, nor LAHSA consistently track services for people in shelter or housing. Yet the city officials at the town hall asked us to believe Inside Safe is an unqualified, albeit expensive, successful program. In fact, it is the worst of both worlds; neither effective nor financially sustainable. We must remember, after expenses exceeding $323 million, Inside Safe has permanently housed only 1,542, or about 3.5 percent of the city’s 44,000 homeless people. Housing the remainder would cost in excess of $3.6 billion dollars. And it wouldn’t stop there because the homeless population isn’t static; as some people exit homelessness, others fall into it, and would need shelter and housing. Costs would continue as long as homelessness and Inside Safe exist.

So, then, who are we to believe? A mayor and Councilmember who choose rhetoric over performance and who try to reframe programmatic failures as differences in philosophy, or a Councilmember willing to speak the brutal truth? Perhaps you could rely on the preponderance of evidence from independent reviewers showing the manifold failures of LA’s homelessness programs. Or you could ask yourself if you believe the expenditure of more than $2 billion over the past five years has had a real impact on homelessness. Or you could choose to believe elected leaders (and their staff) who have a vested interest in maintaining the current system. The choice is yours.