Houselessness Is Plaguing The American Landscape-- Why Is That?

This cycle, candidates are telling me that housing in the biggest single issue they're being asked about by voters, even more so than healthcare! And there is a sense of a housing crisis everywhere, not just in big cities, but also in suburbs and the small towns that dot rural America. Here in L.A. we experience it every day because there are few parts of the city where we don't see people without adequate shelter. This is no longer a Skid Row problem. Shervin Aazami is the progressive Democrat running for a congressional seat in the San Fernando Valley held by a do-nothing corporate shill, Brad Sherman, demonstrably more interested in Israel than in his own constituents. The very first issue on Aazami's campaign website is his plan to tackle homelessness.

"When it comes to housing affordability and houselessness," he wrote, "Los Angeles is ground zero. According to the Los Angeles Homeless Services Authority (LAHSA), over 66,000 people in Los Angeles County are houseless-- the second highest rate in the nation. From 2019 to 2020, every city council district in the San Fernando Valley saw rates of our unhoused community members increase-- some as high as by 25% such as in Chatsworth and Canoga Park. Even more alarming is that these rates preceded the COVID-19 pandemic, which has caused a nearly three-fold increase in unemployment rates in Los Angeles County from roughly 4% in January 2020 to 11.8% by September 2020. Like most crises, LA’s housing crisis falls on racial fault lines. Black Angelenos makeup under 8% of the city population, but nearly 34% of our unhoused. Further, Black and Latinx Angelenos collectively comprise about 56% of the county population, yet nearly 70% of our unhoused. Our unhoused are disproportionately impacted by mental illness, substance use, and police brutality. In fact, 1 in 3 instances of 'use of excessive force' by the LAPD were against an unhoused individual. These housing challenges are made worse by a toxic combination of widening wealth gaps and a striking lack of affordable housing across our district, the city, and the state of California. The median home price in Los Angeles is roughly $715,000-- requiring a salary of $116,000 or more to afford. Yet the median annual income for Latinx Angelenos is about $47,000, and less than $42,000 for Black Angelenos. Similarly, 54% of people in Los Angeles County are renters, with a median fair market price of $1,956 for a 2-bedroom apartment according to the National Low Income Housing Coalition (NLIHC). In order to avoid paying over 30% of income to rent, an individual in Los Angeles would need to make nearly $38 an hour-- more than 2.5 times the minimum wage of $15 in the city. Meanwhile, federal funding for housing assistance has stagnated in recent decades while need has skyrocketed. In the $1.4 trillion omnibus Fiscal Year (FY) 2021 appropriations package Congress passed in December 2020, only $49.6 billion-- or 3.5%-- was for the Department of Housing and Urban Development (HUD). As a percentage of Gross Domestic Product (GDP), federal housing assistance has dropped from a high of 1.4% of GDP in 1978 to 0.23% of GDP in 2018. According to the Urban Institute, housing needs for low income renters increased by 24% from 2005 to 2015, while the number of households receiving HUD assistance increased by only 7% during the same time period. Moreover, when adjusted for inflation, federal funding for housing support dropped by nearly 8% across most programs including housing choice vouchers, housing for the elderly and disabled, public housing, and public-private housing partnership programs."

He warned that "these challenges won’t be solved by small ideas, or by incrementalism. They require bold, transformative action. He has a very detailed 12-point program here, not the kind of thing American voters expect from our politicians, neither those aspiring to office or even those in office. This morning he told me that "Our affordable housing challenges stem largely from three areas-- exclusionary zoning (a relic of red-lining), labyrinthine rules around financing, and chronic underfunding of public housing at the federal level. Five out of the eight top federal housing programs have lost funding when adjusted for inflation over the past decade. As poverty, stagnant wages, and high cost of living plunge more and more people into homelessness, Los Angeles and other major cities have responded with criminalization and banishment as opposed to building housing and bolstering social safety net programs. Our lawmakers have chosen to perpetuate the trauma as opposed to solving this humanitarian crisis. In addition, market-based approaches like the Low-Income Housing Tax Credit (LIHTC) need significant policy and financing reform in order to make a meaningful dent in addressing affordable housing challenges. With LIHTC, the problem stems from operating in a housing market that is focused on maximum profits, not universal housing as a human right. As a result, most LIHTC funds are spent paying off intermediaries-- like housing syndicators and investors-- with little left over for actual construction. Additionally, LIHTC projects are often only approved in low-income communities, leading to more concentrated poverty and racial and economic segregation. One way to mitigate these issues is by funneling LIHTC funds directly into municipalities, who would be tasked with identifying, developing, and managing public housing construction. These housing units would be publicly owned and operated, thus eliminating the need for multiple private intermediaries. The reality is we could permanently end homelessness in America with under 10% of what we spend in a single year on the Pentagon. Poverty is a policy choice."

Today, Ted Lieu introduced a bill in Congress, the Housing for All Act, that would "provide a surge of funding for strategic, existing programs to reduce homelessness as well as invest in innovative, locally-developed solutions to help those experiencing homelessness." Lieu told his constituents this morning that "Homelessness remains a persistent and difficult problem in Los Angeles and in communities around the country. The pandemic only worsened the economic and societal factors that contribute to homelessness, which is why it is so important that we address this issue head-on now. Homelessness is a complicated challenge that requires a multi-faceted approach." The money allocated would go to invest in proven solutions by:

• Addressing the affordable housing shortage by investing in the National Housing Trust Fund, the HOME Investment Partnerships program, the Section 202 Supportive Housing for the Elderly Program, and the Section 811 Supportive Housing for People with Disabilities.

• Addressing the homelessness crisis by investing in Housing Choice Vouchers, Project-Based Rental Assistance, the emergency solutions grant program (which helps with street outreach, rapid re-housing assistance, emergency shelter, and homelessness prevention), and Continuums of Care.

• Supporting innovative, locally developed approaches to these crises by investing in hotel and motel conversions to permanent supportive housing with supportive services; investing in the Eviction Protection Grant Program; investing in mobile crisis intervention teams to help those with medical or psychological needs avoid the criminal justice system; investing in libraries that support people experiencing homelessness; investing in programs that offer a safe place to park overnight and facilitate access to rehousing services and essential services; and investing in inclusive, transit-oriented development and infill development.

A few years ago my friend bought a newly renovated 820 square foot bungalow in a transitioning neighborhood for $160,000. It has a bedroom, a bathroom, a living room, kitchen, laundry room and dining room. This past November, NPR reported that 5 years ago "LA voters overwhelmingly voted for Proposition HHH, a $1.2 billion bond measure to create 10,000 new apartments over a decade for people experiencing homelessness. Halfway through that timeline, nearly all the money is committed, yet only about 1,000 HHH-funded units have opened, at an average cost of more than $500,000 each, according to LA Mayor Eric Garcetti’s office. Still, city officials project that before another five years passes, HHH will meet its goals. So," asked Anna Scott and Saul Gonzalez, "is Prop HHH failing or succeeding?"

While some voters may have thought the aim of Prop HHH was to end homelessness in the city (where more than 41,000 people live on the streets and in shelters), Garcetti says that was never the goal, and if it were, the measure’s grade would be somewhere below an F...

Others argue that even if HHH ultimately lives up to its own modest standards, the measure lacked ambition, urgency and creativity from the start, representing a failure to seize opportunity.

“What is the plan after these funds are spent?” asks the city’s former chief administrative officer, Miguel Santana, who also headed a citizen panel overseeing HHH. Instead of settling for the typical poky pace of new affordable housing development, he says, the city should have used the one-time dollars to spearhead new, more efficient ways of building.

“If we were really thinking about this at the level that met the need, we could have hopefully created a national model for building affordable housing at the scale that's necessary,” Santana says

That is not what’s happened.

Instead, HHH plugged its $1.2 billion into the longstanding Byzantine system that already exists around affordable housing financing. Within that system, developers solicit money for projects from multiple sources (like banks and government loans), using each financial commitment as leverage to secure the next. Going around to three, four, even five different funding sources on a single development takes time and, ironically, money.

“It's not uncommon to spend several hundreds of thousands of dollars, or in some cases well north of $1 million in legal fees on the front end before we ever put a shovel in the ground,” says John Maceri, CEO of The People Concern, a homeless services nonprofit that has been involved in developing new affordable housing projects.

Prop HHH was supposed to simplify that process by providing developers with one sure pot of funding early. The hope was that many could then complete their budgets with only one additional source. However, it didn’t work out that way for a variety of reasons, including some outside the city’s control.

For example, according to Robin Hughes, president and CEO of the nonprofit affordable housing developer Abode Communities, changes to the corporate tax rate under the Trump administration reduced corporations’ need for tax write-offs. That cut demand for tax credits, a major source of affordable housing funding. Private entities, including corporations, buy the credits from affordable housing developers in exchange for cash to build projects.

Obtaining the credits, which are distributed by the IRS to states and local municipalities, and then to affordable housing developers, has also become extremely competitive in recent years. The process can take many months or even years in some cases, according to city officials and developers.

Still, Hughes speaks positively about HHH. “I know the general public may not feel like housing is being produced,” she says. “But we are producing more and more supportive housing and getting people off the streets. The unfortunate part is that we're also seeing people, especially in an economic downturn, experiencing housing instability and sometimes homelessness too.”

Others are more critical. In a pair of audits, LA City Controller Ron Galperin criticized HHH projects for being too slow and too expensive. Costs have ballooned from what Galperin says was an original projection of $350,000 per unit to the city’s current estimate of $579,616 per unit. (The city typically only kicks in about a quarter of that, and the rest comes from other sources). Galperin has argued for clawing back HHH money from excessively slow or expensive projects and putting some of it into more immediate, transitional housing options.

Former LA chief administrative officer Miguel Santana, meanwhile, says that the city should have looked to invest in more innovative models from the get-go, rather than putting so much money into traditional affordable housing deals. He points to the state’s Homekey initiative as one example of a more efficient approach. Created during the pandemic, Homekey provides cities and counties with federal dollars to buy and convert motels into homeless housing.

"From the perspective of someone experiencing homelessness, who has to wait four to five to six years for housing, from the perspective of a community that only sees the problem getting worse … we could have done better to move faster,” says Santana. “Not just for HHH, but rather to think about a life post-HHH.”

By the way, in the meantime, the value of my friend's bungalow has more than doubled.

At the end of January, Assemblywoman Cristina Garcia asked the Bureau of State Audits to examine the lead agencies of five Continuum of Care areas "to obtain perspective related to best practices of homeless services across the state. She had 8 questions she wanted answered, She found a lack of transparency and a great deal of disorganization, a failure to track state funds and coordinate those dollars with federal funds, a failure to collect data on homelessness from service providers, a failure to provide their expertise to local jurisdictions, a failure to conduct comprehensive annual gaps analysis to determine if the amount and type of services provided in their areas are adequate to achieve the goal of reducing homelessness and noted that "some do not have comprehensive plans with strategies to address homelessness, some still manually conduct counts and record data, and some lack a dedicated hotline for assisting the homeless." These were her original 8 questions:

This morning, she explained to me that the CoCs were set up by the federal government to coordinate efforts-- and resources-- between all levels of government and with the non-profits involved with the crisis-- federal, state, local. She asked for the audit because she and some of her colleagues saw the intent of the funding was not addressing the urgencies inherent to the problem and they sensed serious breakdowns-- broken up and down the ladder-- with "the number of the homeless and unhoused continuing to grow. As progressives, we simply cannot support programs intended to solve the social problems we care about when those programs do not meet that intent." She sent me this summary from the state auditor:

I want to remind you that you can contribute to both Cristina Garcia's and Shervin Aazami's congressional campaigns-- as well as to those of the other California candidates-- here on a page that includes men and women who mean to fix the problem, not find some kind of empty satisfaction in passing pie-in-the-sky legislation that bogs down in bureaucracy and fails to address and deal with the underlying issues of homelessness. If anyone is going to get this done, it's people who really care about it, like Cristina and Shervin, not neoliberal poseurs like Brad Sherman and Robert Garcia, their careerist primary opponents.