Special to the Vanguard

Sacramento, CA – A state audit found that the state has to do a better job of assessing the cost-effectiveness of its homelessness programs, although despite the homeless crisis, the report did have some positives to report on some of the state programs.

More than 180,000 Californians experienced homelessness in 2023—a 53 percent increase from 2013. To address this ongoing crisis, nine state agencies have collectively spent billions of dollars in state funding over the past five years administering at least 30 programs dedicated to preventing and ending homelessness.

Last year, the Joint Legislative Audit Committee requested an audit of the State’s homelessness funding, including an evaluation of the efforts undertaken by the State and two cities to monitor the cost‑effectiveness of such spending.

“In general, this report concludes that the State must do more to assess the cost-effectiveness of its homelessness programs,” Grant Parks, California State Auditor concluded.  “The State lacks current information on the ongoing costs and outcomes of its homelessness programs, because Cal ICH has not consistently tracked and evaluated the State’s efforts to prevent and end homelessness.”

The staff did find, in reviewing five state-funded homelessness programs, that two were cost effective: Department of Housing and Community Development’s Homekey program and the California Department of Social Services’ CalWORKs Housing Support Program.

However, he said, “we were unable to assess the cost‑effectiveness of three other programs we reviewed because the State has not collected sufficient data on the outcomes of these programs.”

Senator Dave Cortese who asked for the audit last year, said in a statement, “The audit highlights the need for improved data and greater transparency at both the state and local levels. Since 2017, California’s homeless population has increased by about 38 percent, rising by approximately 50,000 to over 180,000 individuals.”

He explained, Unfortunately, there is a balkanized approach to data collection and outcomes, with no centralized system for tracking our investments. This data desert leaves the Legislature and the public without a system of checks and balances to answer basic questions about the effectiveness of our programs.”

There were some positives.

For example, the report found positive outcomes for people placed into permanent housing.

“The good news is that the data showed positive outcomes for people placed into permanent housing,” Senator Cortese said.  “In San Jose, 58% of the people placed into permanent housing remained housed, and 81% in San Diego.”

However, the report found “the data is less conclusive regarding people placed into interim housing.”

Senator Corse said, “Additional interim and permanent housing is needed, but there is no quantifiable plan to address this issue, which is troubling. We’re not singling out any agency or city.”

He added, “If we’re seeing these issues in cities as large and sophisticated as San Jose and San Diego, it stands to reason that these issues are pervasive in communities across California. This audit underscores the urgent need to establish best practices and create a blueprint for how the State of California and our cities can address our most visible challenge.”

Key Findings

Cal ICH has not consistently tracked and evaluated the State’s efforts to end

• Because Cal ICH has not tracked and reported on the State’s funding for homelessness programs since its 2023 assessment covering fiscal years 2018–19 through 2020–21, the State and its policymakers are likely to struggle to understand homelessness programs’ ongoing costs and achieved outcomes.
• Cal ICH has not established a consistent method for gathering information on homelessness programs’ costs and outcomes, leaving the State without information that would allow decision-makers to make data-driven decisions.

Two of the five state-funded programs we reviewed are likely cost-

• Homekey allows the State to provide individuals with housing that is less expensive than newly built affordable housing units. The Housing Support Program helps house families who are at risk of or experiencing homelessness and costs less than the State would spend if these families were homeless.
• The Encampment Resolution Funding program; the Homeless Housing, Assistance and Prevention program; and the State Rental Assistance Program did not collect adequate data on program outcomes to assess their cost-effectiveness.

Key Recommendations

• The Legislature should amend state law to require Cal ICH, by March 2025, to mandate reporting by state agencies of costs and outcomes of state-funded homelessness programs. To implement such reporting, the Legislature should require Cal ICH to develop guidance establishing specifics on uniformity of data to be collected and how it is to be presented. The Legislature should require Cal ICH to annually compile and report this cost and outcome information publicly beginning in September 2025 and should provide resources for this effort, as necessary.

• Cal ICH should request that state agencies responsible for administering state-funded homelessness programs provide spending- and outcome-related information for people entering, experiencing, and exiting homelessness. By March 2025, Cal ICH should develop and publish on its website a scorecard—or similar instrument—that would give the Legislature and other policymakers the information necessary to better understand each homelessness program’s specific costs and outcomes. Cal ICH should determine and request from the Legislature any necessary resources required for this effort.