Oakland received millions of dollars from the state and federal government for homeless shelters and housing during the COVID-19 crisis, money that must either be spent over the next couple of years, or be forfeited. City staff are now working to make sure Oakland spends every last penny, but an even bigger problem looms: What happens when the money runs out?
The multiple grants, which total about $44 million, have paid for hundreds of shelter beds, transitional housing, rent subsidies, employment training, and hygiene services for unhoused residents. City staff don’t expect this “one-time” money—currently 64% of the city’s homeless services budget—to be renewed.
“We want to make sure you understand the fiscal cliff we’re going to face,” Sara Bedford, Oakland’s director of human services, told members of the City Council’s Life Enrichment Committee on Monday. The committee is reviewing the city’s homelessness spending plan before the full council considers it. Staff said that doing so now will reveal where funding gaps remain, so the City Council can try to come up with new sources when it passes the entire 2021-2023 budget later this spring.
According to Bedford, if the state and federal government don’t offer another round of assistance to cities like Oakland, current programs will need to be cut.
Tight timelines to spend federal and state grant money
Lara Tannenbaum, Oakland’s human services manager, said that the city has to work fast to spend its state and federal homeless grant money, most of which is time-limited.
“There is some urgency to figure out how we’re going to mix and match these funding sources to make sure we spend them down in the time period allowed,” she said during the council committee meeting. “We certainly don’t want to leave any on the table,” and any programming changes the council wants to make should happen now, she said. If any programs were to close, staff would need four to five months to find housing for impacted residents, according to a report shared with the council.
The proposal that city staff presented Monday focuses on preserving existing Oakland homelessness programs. Launching any new services, said staff, would require sacrificing current shelter beds. Under the plan, funds raised by Measure Q—a parcel tax approved by Oakland voters last year to pay for homelessness services—would be used to continue programs that depend on ongoing funds, like the Henry Robinson Center and The Holland, two transitional housing programs.
Out of all of Oakland’s current programs, “transitional housing is certainly the most expensive intervention now, but also gets the best outcomes,” said Tannenbaum. At The Holland and the Henry Robinson Center, individuals stay for 4-6 months in their own rooms while caseworkers help them connect with social services, seek employment, and stabilize their lives before ideally moving into permanent housing. Those programs, unlike Community Cabin shelters—clusters of small structures built to house one or two people each— have significant funding to help residents find and transition into housing, Tannenbaum said.
City staff are also recommending the council continue to fund the Family Matters shelter, emergency motel vouchers, and staff outreach at encampments.
The staff proposal also uses various one-time funds to cover the Community Cabin shelters, subsidies for people moving out of COVID-19 hotels into permanent housing, RV parking services, showers, and support for the new Clifton Hall shelter, purchased with state relief money.
Some recipients of homelessness services—including those that could be on the chopping block—called into the meeting Monday. Some said they were asked by leaders of those programs to voice their support.
“I was sleeping out in the rain, going place-to-place,” said a man who lives in a Community Cabin. “This is like family. I will hate to leave when the time comes, but I’m getting on the right journey.”
Another commenter, Jenn Oakley, praised the city’s housing vouchers, saying she received counseling and got her own place in Berkeley.
Even with state homeless funding, many people still live on the streets
As successful as some of Oakland’s current programs may be, and even with the significant funding increase provided last year by the state and federal grants, each serves only a tiny fraction of the overall homeless population at any given time.
“It’s wonderful that you’re talking about helping people but you’re in the wrong order of magnitude when you’re talking about tens or hundreds of people and you’ve got thousands on the streets,” said Naomi Schiff, an advocate for unhoused Oaklanders, at Monday’s meeting.
Some councilmembers said the city could, and should, be doing much more with the funding that is currently available.
“We’re going on almost a year since the global pandemic started. We need to see the entirety of the city with all hands on deck to this crisis, and I’m not seeing that,” said District 2 Councilmembr Nikki Fortunato Bas, who represents Chinatown and the Lake Merritt area. For example, Bas said, the city entered into a deal with a housing developer for an E. 12th Street lot several years ago, but the project hasn’t been built and there’s a large homeless camp at the site. Bas would like to see the city put modular, temporary housing on the vacant lot to house homeless people.
Much of the disagreement at Monday’s meeting centered on whether Oakland could take advantage of a new executive order signed by President Biden that permits cities and counties to be fully reimbursed by the federal government for COVID-19 homeless shelters in hotels and other non-group settings. Until the order, cities and counties could receive only a 75% reimbursement from FEMA. Some city leaders and housing activists are hoping that the order signals a new willingness from Washington to assist cities.
At-large Councilmember Rebecca Kaplan, who represents the whole city, said the council has repeatedly asked staff to launch hotel shelters under the assumption that money spent on this can eventually be recouped from the feds.
“Yet we see it’s not happening,” Kaplan said. “Those funds come back to us, now that it’s 100% reimbursement, and we have people living in really dangerous situations. I know we’re worried about not having enough money, but let’s make sure we use every penny we can, every way we can.”
While there are several emergency hotel shelters operating in Oakland, they’re run by Alameda County, not the city. Oakland, however, received state awards to purchase buildings to convert into permanent supportive housing.
“We are actively pursuing this and we think it’s a great opportunity,” said Bedford, the city director, about the FEMA money. But many of the state funds that Oakland receives are not eligible for that reimbursement, she said, so there’s still an issue of finding money in the city’s strained budget to front. Plus, she said, those hotel programs are required to serve older and medically vulnerable residents, who need additional costly services, an expenditure Oakland may not be able to afford due to an estimated $150 million budget shortfall over the next two years.
“I want to set realistic expectations,” Bedford said. “Right now, all those people would be released to the streets if we haven’t invested in their outcomes.”
Kerry Abbott, Alameda County’s director of homeless care and coordination, said the county has an “almost singular focus on getting people housed from the hotels” it currently operates, but which are closing down. Opening a new hotel shelter “is legitimately a big lift,” she said.
And the county still has not been reimbursed by FEMA for the existing hotels, she said.
District 3 Councilmember Carroll Fife, who represents West Oakland and downtown, urged staff to reevaluate existing programs and instead invest more time and money into building new affordable housing on city-owned land. Councilmembers said they’re waiting for an upcoming auditor report examining homelessness programs.
With so many of the current programs dependent on one-time funds, or insufficient amounts of money, officials and advocates in Oakland are also supporting a state bill that proponents say would create the first major sustainable funding source to end homelessness in California.
The bill, AB71, would raise the corporate tax rate for large companies, generating $2.4 billion yearly for supportive housing, emergency shelters, and other services. Mayor Libby Schaaf is a vocal backer of the bill, while business groups are opposing it.
The plan for homeless spending will return to the Life Enrichment Committee for another discussion and vote on March 22, and will include recommendations around hotel shelters and building on public land, per a request from councilmembers.