The overview
Officials will decide which of their funding requests, including homelessness programs, will be supported in the fiscal year 2024-25 city budget that's up for adoption Aug. 14. Their review comes as an estimated 6,300 people are now likely homeless across the Austin area, and after current and formerly homeless individuals have petitioned for more aid this summer.
Joel Cole, a leader with the nonprofit Vocal-TX, said he'd spent 10 years homeless in Austin before he was able to improve his situation in supportive housing. On July 24, he urged officials to focus on improving other residents' transitions between short-term and permanent housing with more funding for both city-backed programs.
"There's a lot of people that are way worse off than me that have rapid re-entry housing," he said. "It's just so sad because I know ... what the difference can do. And I see that there's no way for these people that deserve and need permanent supportive housing to go from rapid re-entry to permanent supportive housing."
Zooming in
Austin spends tens of millions of dollars annually on homelessness strategy, with more than $80 million budgeted this fiscal year.
Much of that money goes into housing programs, with the rest split between crisis services, such as shelter and street outreach; homelessness prevention, such as rental assistance; public encampment management; and other services.
Looking ahead to FY 2024-25, much of that work was projected to continue with both city and one-time federal American Rescue Plan Act dollars.
About $25 million would be available for rapid rehousing, which can include rental support and other services over a year or two. More than $26 million is set aside for several shelter operations across Austin. And to keep people from falling into homelessness, more than $6 million was reserved for the I Belong in Austin tenant assistance program and other homeless prevention initiatives.
Millions more in city bond dollars are also expected to be spent on new permanent supportive housing developments, where longer-term housing assistance and other support is offered.
Beyond those totals, several council members have proposed nearly $20 million in additional spending to continue or expand various response efforts. Council budget amendments centered on homelessness include:
- $1.25 million in the budget, plus a potential $16.5 million in city-issued debt, to expand the operations of the Downtown Austin Community Court with two new locations in North and South Austin
- $4.2 million for permanent supportive housing
- $2 million-$4 million for rapid rehousing programs
- $3.21 million—offset by other budget moves—for resident housing support to avoid homelessness
- $2.86 million for shelter operations
- $2 million to continue the Homelessness Engagement Assistance Response Team partnership with the Downtown Austin Alliance
- $984,000 to continue and staff the DACC mobile court program
- $375,000 for new staff to clean up homeless encampments
- $300,000 to help house families experiencing homelessness
More funding is being sought given the need in the community and as ARPA funding is drying up.
Council members also called out proposed funding levels given questions about the number of people now being served, and whether current processes are the most effective at moving people from shorter- to longer-term housing.
Matt Mollica, executive director of the Ending Community Homelessness Coalition that oversees the regional homeless response system, said the Austin area is in need of about 3,100 rapid rehousing units at this point. However, the system has less than 1,400 units in total.
To completely cover that gap, Budget Officer Kerri Lang said one year of rapid rehousing services for all potential clients could cost upwards of $60 million. Council member Vanessa Fuentes said that "significant funding gap" is one reason for officials to focus on the issue this summer, even if extra funding won't completely cover that difference.
Mollica also highlighted how the shortage of supportive housing, which he said is often the most appropriate intervention for disabled and chronically homeless clients, can leave people enrolled in the short-term programs instead.
"Of course, when given the choice, ‘Do you want rapid rehousing or nothing,’ folks are asking for rapid rehousing," he said July 24.
In recent months, clients and advocates have reported rapid rehousing programs meant to last up to two years have been running out sooner than expected. Vocal-TX leader Barry Jones said he recently ended a decade of homelessness after securing housing this summer. As gaps between rapid and permanent housing programs were being discussed, Jones said it's time for more civic support.
"We can't kid ourselves about what it means to put somebody out of the rapid rehousing program back out on the street. This is a matter of life and death," he said. "The only way that we can solve this problem is by giving people a chance to gain permanent housing, stable housing, where they're not a bother to other people."
While hundreds of supportive units are now in planning or construction, Mollica said thousands more will likely be needed over the coming decade. Staff also noted the need to find more sustainable ways to fund those units and programs long-term without ARPA and bond dollars in play.
Funding decisions on emergency and bridge shelter also lie ahead, especially given the impending closure of the temporary Marshalling Yard center and its 300 shelter beds early next year. Clients there are expected to gradually be released to other locations before it's shut down, but city staff have yet to identify any replacement facilities for future shelter space.
The cost
Whether rapid or long-term, the city's housing interventions are costly but generally reported as effective.
Staff said rapid rehousing in Austin has about a 70% overall success rate and comes at an annual cost of about $35,000 per client.
Permanent supportive housing is viewed as the most effective option, with about 98% of clients either maintaining stable housing or moving out of programs to a permanent destination. It's even more expensive at about $20,000 in annual services plus an estimated $19,000 for rental assistance.
Council member Ryan Alter noted the far lower cost of preventing people from becoming homeless in the first place, with targeted tenant support estimated to start at just over $2,000.
“It’s incredibly important to look upstream of our system," he said. "We have a real challenge downstream, ... but if we have the ability to spend a tenth of the money per person to have a better outcome, to make sure they don’t become chronically homeless, and to make our resources go further, that just seems like a no-brainer.”
Quote of note
While Austin's budget remains a major factor for local homelessness strategy, council member Alison Alter also stressed the importance of city collaboration with other entities—and the philanthropic community, which was previously expected to have more of an ongoing role in funding.
"I know that there are these problems, and we want to step in, but every time we step in it becomes more on the city instead of being a collective effort," she said. "I’m concerned about just putting more and more money without getting some commitments from others to be part of the solution that are effective and working. Because this could take over our entire budget, and so I just think we need to be mindful of that.”
