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LA WATCHDOG - To provide interim housing for the homeless, the Los Angeles City Council approved the purchase of the 294 room Mayfair Hotel for a cost of $83 million. This equates to over $280,000 a room.
If this cost per unit is applied to each of the 30,000 unsheltered people in the City, the capital cost would be $8.5 billion, seven times the $1.2 billion of Proposition HHH bonds that were approved by the voters in 2016. This does not include operating expenditures for maintenance, utilities, and numerous other everyday items. It also does not include services for the homeless that are supposed to be the responsibility of the County.
In a controversial report by former Controller Ron Galperin, the average cost of a unit of permanent supportive housing was $600,000. Assuming double occupancy for the 30,000 unsheltered Angelenos, the capital cost would be $9 billion. This may be understated because it does not account for the 16,000 homeless individuals who are sheltered. Again, this does not include operating expenditures or services for the homeless.
What is the source of the billions needed to finance these capital projects? And what is the impact on Angelenos and our property taxes?
This year, the City allocated $1.3 billion to its homeless services and housing programs. This includes $475 million from the General Fund, $236 million from the last of the Proposition HHH bonds, and over $300 million in various grants. These sources of funds, however, are not sustainable.
The Mayor’s Inside Safe initiative appears to be a one-shot deal based on the CAO’s Four Year Budget Outlook. The Proposition HHH money will be exhausted. And will the many grants will be renewed?
Again, how does the City propose to finance its homeless services and housing programs since the new labor agreements with the police and civilian unions will have a devastating impact on next year’s budget.
The Mayor and the City Council owe us a concise, well written report on how it intends to finance its homeless services and housing programs, the impact on Angelenos and our taxes, and whether our tax dollars are being used efficiently. This report should also include information on “mission creep” as the City is performing services that are the responsibility of the County.
On this Sunday’s 60 Minutes, Governor Gavin Newsom expressed his frustration with the efforts of local governments to address the homeless crisis. He is not alone. If City Hall wants our support at the ballot box when it is asking us to approve funding for its homeless efforts, Mayor Bass and the Krekorian led City Council need to be transparent and provide us with the appropriate information in a timely manner.
(Jack Humphreville writes LA Watchdog for CityWatch. He is the President of the DWP Advocacy Committee, the Budget and DWP representative for the Greater Wilshire Neighborhood Council, and a Neighborhood Council Budget Advocate. He can be reached at: [email protected].)
