Nine months after ribbon-cutting, Salvation Army’s East Austin homeless shelter to open at limited capacity

City officials and Salvation Army members gathered in front of the Rathgeber Center in September to publicly push for operating cost donations. (Christopher Neely/Community Impact Newspaper)
City officials and Salvation Army members gathered in front of the Rathgeber Center in September to publicly push for operating cost donations. (Christopher Neely/Community Impact Newspaper)

City officials and Salvation Army members gathered in front of the Rathgeber Center in September to publicly push for operating cost donations. (Christopher Neely/Community Impact Newspaper)

Under the morning sun in June 2019, local philanthropist Dick Rathgeber, alongside his wife and other Salvation Army officials, cut the ribbon on the new $12 million, 212-bed East Austin homeless shelter bearing his name. However, due to fundraising issues, the facility has yet to provide shelter for any of Austin’s growing homeless population.

But that is set to change soon. The Salvation Army announced earlier this week the Rathgeber Center, located at 4613 Tannehill Lane, Austin, will welcome its first 14 families—55 individuals—at the end of February, more than nine months after its June ribbon-cutting ceremony.

The Salvation Army has raised just over $2.2 million to operate the shelter through September, according to a press release sent out earlier this week. That $2.2 million represents only 48% of the shelter’s $4.7 million annual operating costs, but Salvation Army Director of Communications Corey Leit said the $2.2 million could allow the shelter to operate at 100% capacity through September—the end of the fiscal year.

However, in welcoming in 55 individuals at the end of February, the shelter is opening at only 26% capacity. Rather than attributing that figure to a funding issue, Leith said the limited initial opening owes to The Salvation Army’s slow hiring process. Although the Rathgeber Center is mostly staffing close-to-minimum wage jobs, Leith said the positions require extensive background checks, which creates lag time. Leith could not provide numbers on how many staff the Rathgeber Center expects to bring on board this year but said the center’s ability to help clients is commensurate with staffing numbers.

Annual operating cost estimates have shifted multiple times since Salvation Army cut the ribbon on the center in June 2019. Initially, operating costs were $5.2 million; by September, that number dropped to $4.9 million. After some budget analysis, Leith said operating costs now sit at $4.7 million.


The $2.2 million on which the center is relying through September came from five donors, according to the Salvation Army. Integral Care contributed $500,000; the Downtown Austin Alliance pledged $500,000; an anonymous donor gave $100,000 and the Lola Wright Foundation gave $135,000. The largest contribution came from the city of Austin, which contributed $1 million in taxpayer money after a strong push by District 9 Council Member Kathie Tovo.

The city’s contribution, which makes up roughly 45% of the center’s FY 2019-20 funds, was a one-time donation. City leaders have acknowledged that with state-mandated property tax revenue caps coming online next year, such a contribution would be difficult to repeat.

Although startup funds were difficult to come by, Leith said the Salvation Army is “100% confident” it can raise the money necessary to keep the Rathgeber Center running for years to come and is actively recruiting a team of experts to begin a robust fundraising campaign. Around the time of last year’s ribbon-cutting, Salvation Army Director of Development Kelly Perkins said a major obstacle in fundraising was simply getting the center opened. She said that typically, more donors avail themselves once they see a facility is already operating.

At full capacity, the Rathgeber Center will provide a significant boost to the city’s homeless shelter bed count, something the community has made a priority for 2020. The Downtown Austin Alliance and the Greater Austin Chamber of Commerce are partnering to open a 300-bed homeless shelter in the first quarter of this year through their ATX Helps initiative. Austin Mayor Steve Adler said the city has set a similar goal: adding 300 beds to its shelter roster by the end of this year.

The initial 55 individuals to be served at the Rathgeber Center will come from the Salvation Army’s downtown shelter. City leaders have consistently prioritized getting vulnerable families out of the shelter downtown, an area which officials have said is not ideal for children. The initial transfer of people to the Rathgeber Center will open up 55 beds at the downtown shelter. Salvation Army has a shelter wait list of 137 individuals.