Economic Development

A Roof To Start With

Cities are moving homeless people straight from the street into permanent housing--no questions asked. It's controvesial, but it's showing results.
by | December 2005

Back in 1990, when the homeless problem in San Francisco was still a relatively new concern, then-Mayor Art Agnos made a pledge he couldn't keep. He said he would "end sleeping on the streets as a commonplace occurrence." Not only was he going to conquer homelessness, he was going to do it in a year.

Agnos built two huge shelters. But when they filled quickly, he allowed people to pitch tents in the plaza outside City Hall, creating a settlement that became widely known as "Camp Agnos." When voters booted Agnos out of office in 1992, the political lesson seemed clear enough: When it comes to homelessness, it doesn't pay to make big promises.

The next mayor, Frank Jordan, was a former police chief, and tried a law-and-order approach. Police cracked down on public urination, loitering and camping. That kept homeless people on the move, but did nothing to reduce their numbers. The problem only intensified under Jordan's successor, Willie Brown, as housing costs skyrocketed in the late 1990s. Crowds of people sleeping on Market Street became, like cable cars and the Golden Gate Bridge, something that San Francisco was known for. Brown declared that the homelessness problem "may not be solvable."

Now, however, San Francisco is making promises again. Gavin Newsom, the youthful mayor finishing his second year in office, has pledged to end "chronic" homelessness--that is, among the people who most persistently turn up on the street and in emergency shelters. He's won passage of a ten-year plan intended to pursue that goal, though his timetable is actually more like six years.

As promises go, Newsom's pledge sounds more cautious than the one Agnos made. But then again, the homeless problem today is bigger, more complex and deeply entrenched. Given the tense local history around the issue, it would seem that the mayor, who is best known nationally for his failed try at legalizing gay marriage, is once again up to something that could be viewed as either laudably courageous or utterly foolish.

This time, however, Newsom has some important allies, including an unlikely one: President Bush. The Bush administration is asking cities and counties across the country to adopt Ten-Year Plans much like the one in San Francisco. The plans are the cornerstone of an emerging national strategy to eliminate chronic homelessness, arguably the best-articulated part of Bush's "compassionate conservative" agenda. This is one of the few programs--perhaps the only significant one--on which Bush and big-city mayors, many of whom are liberals like Newsom, can agree. In just two years, more than 200 localities have passed their own Ten-Year Plans. Dozens more are currently debating them.

Plans, of course, can sit on a shelf. Ten-year ones, moreover, guarantee that most mayors won't be in office long enough to be held accountable. What's more important than the plans themselves is that the fundamental approach to homelessness is changing--and in controversial ways.

One is a matter of targeting. In the past, big cities have spread their efforts more or less equally among all homeless populations-- families, children, single adults and seniors--a population estimated around 8,600 in San Francisco when Newsom took office. Now Newsom is putting the biggest effort, and more resources, into the 3,000 or so single adults in his city who are sleeping in shelters and on the street.

The second change is in strategies for dealing with that hard-core population. Most of the chronic homeless struggle with substance abuse, mental illness, or both. The view up to now has been that it is best to treat the underlying problems first, in order to make the person "housing-ready." The new thinking, called "Housing First," turns this notion upside down. San Francisco is putting homeless people, with all their problems, directly into their own permanent units. Detox, twelve-step plans, hounding schizophrenics to take their medication--all that can come later. Eventually, the mayor hopes to close emergency shelters altogether.

Success is hard to measure in this business, but San Francisco officials believe that "Housing First" is working. By their count, the population on the street has dropped by 41 percent in three years. Some 1,600 units of "permanent supportive housing" have come on line since Newsom took office. Once housed, about 95 percent of the people in the programs stay housed.

More and more, Newsom's aides talk about reaching a "tipping point." That's an idea they've borrowed from Malcolm Gladwell, the writer whose book by the same name suggests that modest targeted actions can build upon themselves to cure large social ills. "The street population is the most visible problem--people see these folks day in and day out," says Dariush Kayhan, director of homeless programs at the city Human Services Agency. "If you're able to show measurable change, then the resources start to move toward that problem to solve it."

Many homeless advocates vehemently disagree. They call the focus on chronically homeless adults "arbitrary" and complain that it comes at the expense of the growing numbers of homeless families. They also argue that Bush's policies are working at cross-purposes. The Ten-Year Plans, after all, are coming at the same time that the administration is proposing cuts in public housing and community development block grants. "Every few years the feds throw up their hands because the homeless problem keeps getting worse, and they say the problem is we need a new plan," says Paul Boden, an advocate who tracks homeless policies throughout the West. "I don't see it as a dramatic shift. I see it as a well-done public relations campaign, but without the funding to go with it."


But even some of the administration's fiercest critics acknowledge a new energy rippling on this issue. Much of that is due to Philip Mangano, a longtime homeless advocate from Boston whom Bush picked as his "homeless czar." Mangano's position comes with no cabinet portfolio and not much funding. What Mangano does possess is a persuasive charm, a positive attitude and a ton of frequent flyer miles. Nobody has done more than Mangano to change the national dialogue on homelessness. And he's done it in a way that mayors, stuck on the ground with this problem every day, find both inspiring and politically useful.

The Gospel of Mangano begins with an observation: As governments, nonprofits and churches have spent more and more on homelessness, the problem has only grown worse. The well-meaning efforts of shelters and treatment programs have added up to little more than "managing, maintenancing and accommodating" the crisis. "We'd conceded to the intractability of homelessness," Mangano says. By contrast, he calls himself an "abolitionist." He believes the first step for policy makers is to begin treating homelessness as a solvable problem.

Mangano sounds like an economist when he talks about Ten-Year Plans and "Housing First" as "disruptive technologies." He sounds like a management consultant when he says that "any investment we make should be data- and research-driven, performance-based and results-oriented." By framing the issue around research, not ideology, Mangano has made it easier for Democratic mayors to put aside differences with Bush. It also helped that Mangano had an old friend in the leadership of the U.S. Conference of Mayors--Tom Menino of Boston--to convince colleagues that the message was worth listening to.

The research Mangano sells them on analyzes the costs incurred by the long-term, hard-core street homeless. These are the people who tend to ricochet between shelters, emergency rooms, jails and the street. What researchers have found is that about 10 percent of the overall homeless population is consuming about half of all the resources.

One study followed 15 chronically homeless people in San Diego. In just 18 months, those 15 people consumed $3 million worth of public services. That's $200,000 per person--and they still remained homeless. "We could have rented them oceanside penthouse condos, and provided them with a servant to attend to every one of their needs, and it still would've been a less expensive intervention," Mangano says.

The studies explain Mangano's obsession with targeting the chronic segment of the homeless population. They also explain his faith in "Housing First" as a strategy for solving it. Conventional wisdom said that street people had to straighten up before they could succeed in an apartment setting. They would progress from shelters to "transitional" housing to permanent housing--a system that came to be known as the "continuum of care." That worked for some people. But others were turned off by the rules and high expectations. They preferred to stay on the street, where they were expensive to take care of, got sicker rather than healthier, and remained a visible blight.

Research by Dennis Culhane, a University of Pennsylvania sociologist, convinced Mangano that it is better to put the homeless directly into permanent housing. For example, Culhane studied the way people with severe mental illness fared in a "Housing First" program in New York City. They made fewer visits to hospital emergency rooms and psych wards, rang up smaller Medicaid bills and spent fewer days locked up in state prisons and city jails. "Housing itself has a therapeutic impact," Mangano says. "The security, the stability that housing puts in a person's life creates the context for delivering all the other services."

Mangano's approach is what sociologists call a "harm reduction" strategy. It deliberately puts aside, at least in the short term, the idea of sweeping behavioral change. In that way, it is akin to the sorts of programs that give heroin addicts clean needles so that they won't contract HIV. Some critics on the right say it's a mistake to subsidize permanent housing with so few strings attached. "It would be a shame if we start a queue where if you declare yourself to be out of a home, you just get one," says Howard Husock, a scholar with the conservative Manhattan Institute. "There will be an unlimited appetite for that."

Advocates on the left are troubled for different reasons. They generally support the "Housing First" philosophy, and appreciate that Mangano has sent a jolt of energy through state and local government. They worry, though, that Mangano will succeed in housing single adults, only to put more moms and kids out on the street. "Phil's doing a good job--I'm glad he's there," says Michael Stoops, acting executive director of the National Coalition for the Homeless. "But if I were the federal homelessness czar, and the administration wanted to cut the HUD budget by 12 percent, I'd resign in protest. He's not done that."


San Francisco was quietly experimenting with "Housing First" ideas long before Philip Mangano (or Gavin Newsom) arrived on the scene. That makes the city, along with New York, Philadelphia, and a few others, a favorite Mangano case study. "Anyone who's visited San Francisco knows it has the worst street population problem in the country," Mangano says. "If people come home from San Francisco and say, 'You should see how it's changed,' that will re-moralize this whole effort across the country."

San Francisco's strategy takes advantage of the city's large stock of single-room-occupancy hotels. These are scattered mostly in a low- income neighborhood near City Hall, known as the Tenderloin. In the early 1990s, a local nonprofit called the Community Housing Partnership bought a few SROs and moved a small number of people in off the street. What they found was unusual, according to the thinking of the day. Although tenants weren't required to get clean and sober, most of them did seek treatment once they were housed--if not immediately, then eventually. Many were able to hold down jobs. Only 2 percent of tenants wound up back on the street.

The idea showed enough promise that the San Francisco Public Health Department borrowed it in 1998. County hospital and clinic workers began funneling their most frequent homeless patients into SROs, where they received preventive care on site. "It's unusual for a public health department to provide housing," says Marc Trotz, director of the department's program. "But we had to re-think what we meant by health." Trotz tracked 71 participants and found them consuming $1 million less in emergency health care while living in SROs than they had the year before on the street.

Both these experiments proceeded largely under the radar at a time when San Francisco's top political leadership was talking about the intractability of the entire homeless problem. But Gavin Newsom noticed them. In 2002, as a member of the Board of Supervisors, he proposed vastly expanding the "Housing First" model, and doing it in conjunction with a revamping of the city's welfare system for homeless people. Newsom called this "Care Not Cash." The idea was to replace the existing $410 monthly welfare checks with permanent lodging (recipients still receive $59 in cash). Voters approved Newsom's plan, and then elected him mayor the following year.

That's when Newsom's rhetoric fused with Mangano's. One of the mayor's first moves was to order up a Ten-Year Plan. He picked Angela Alioto, a former rival, to chair the planning committee. Alioto and Mangano hit it off--not least due to their shared devotion to Saint Francis of Assisi, the Italian ascetic who cared for the indigent. Alioto's final report, which Newsom wholeheartedly embraced, read like a "Housing First" manifesto. It even one-upped Mangano's verbiage. It pledged to "abolish" chronic homelessness in the "compassionate city of Saint Francis."

Newsom's goal is to create 3,000 units of new permanent supportive housing. He's doing it in two ways. Half of the units are to be built and owned by the city or nonprofits. A faster method is to lease up more SROs. In two years, the city has leased a dozen additional hotels, using $14 million saved annually from the welfare side of the ledger. Some of the SROs have undergone extensive renovations, paid for by the hotel owners.

As of November, San Francisco had moved 1,070 people from the streets into SROs via the Care Not Cash program. In addition, a significant number from the welfare rolls have left town because San Francisco no longer gives out $410 checks for being homeless. The result is a noticeable decline in the visible problem.

The problem is far from gone, however. On a sunny day in October, for example, two dozen folks were lying on the grass outside Newsom's office, several using coiled sleeping bags for pillows. Anyone shopping around Union Square will notice panhandlers and drunks. It's still impossible to walk down Market Street without seeing a few people stretched out on cardboard boxes, or the occasional screaming schizophrenic.

Care Not Cash remains controversial. At the Coalition on Homelessness, director Jennifer Friedenbach has a faded white sticker on her file drawer that says "Newsom's Plan Will Increase Homelessness." She says the latest "Housing First" push should be renamed "Welfare First" because clients have to be on welfare to get it. "Welfare recipients tend to be higher functioning," Friedenbach points out. In her view, priority should go to people with the greatest medical needs, and those with children.

Jeff Kositsky also opposes Care Not Cash, which puts him in an awkward position. Kositsky heads the Community Housing Partnership, whose own programs are growing under Newsom's regime. Kositsky believes that Newsom is headed in the right direction, but is taking "Housing First" too far. "To dump all the resources into a specific program or type of programs because it's the new trend of the year is probably not the best public policy decision," Kositsky says. "Someone else will come and change it again in a couple of years."


Michael Arrajj is part of the support staff at the Empress Hotel, a beautifully renovated SRO in the Tenderloin run by the Health Department. One afternoon, Arrajj is having a conversation outside the hotel when a tenant he knows exits the building. "Hey Paul, did you go to your job yesterday?" Arrajj asks. Paul, whose boyish white face shows signs of developmental disabilities, turns and shouts back. "Yeah."

Arrajj isn't a job trainer. He's a registered nurse, whose office sits adjacent to the hotel lobby. Formerly homeless tenants stop by all day long to get their blood sugar checked, take their anti- psychotics, and talk about their health--all on a voluntary basis. But like every nurse, case manager or property manager in San Francisco's subsidized SROs, Arrajj freelances outside his job title quite a bit. One day he took Paul to his job, a vocational program for the disabled. If Paul really did make it to work yesterday, Arrajj notes, it would be the first day going on his own. "Baby steps," he says.

This sort of progressive encouragement is what comes second in the "Housing First" model. Tenants in the Health Department's ten SROs arrive straight from the street. They're not required to kick their drug or alcohol habits, or to be fully functional mentally. Instead, the thinking goes, stable homes mixed with artful engagement by people like Arrajj will help tenants turn their lives around--when they're ready. "The goal is to let people in as easily as possible," says health department official Mark Trotz. "We want to take chances with people."

Generally speaking, the Health Department hotels house a sicker population than the welfare hotels coming on line through Care Not Cash. The Health Department SROs also provide more intensive on-site services. Each has a handful of case managers on staff, and a nurse or nurse practitioner on hand or on call. A roving behavioral health team sees tenants at the hotels. For more intensive medical or psychological care, the tenants visit a clinic shared by the SROs. Severely disturbed patients go to the hospital.

Tenants pay half of their income in rent, typically from welfare or disability. House rules limit noise and visitation. Drugs and alcohol are banned from common areas, and selling drugs is against the rules (drug use in the rooms is not). The SROs do occasionally have to evict tenants for violent behavior or nonpayment of rent. But the staff tries to resolve such problems before returning problem tenants to the street. The point of the program, after all, is to keep people housed. "We give them plenty of chances to correct their behavior," says head nurse Carol Baillie.

Among homeless service providers, "Housing First" will remain controversial for a long time. Some wonder if the mentally ill are simply being re-institutionalized--without the same level of medical care an institution would provide. As one person familiar with the Health Department SRO program says, "There are people in there who shouldn't be in there because they are suffering from serious mental illness. If you're moderately mentally ill, and you live next door to someone who's schizophrenic and completely decompensating on a regular basis, that could become an infringement on your rights as someone paying rent." The same argument could be made for recovering addicts. Having neighbors who are using drugs or alcohol is an easy way to get sidetracked on the path to sobriety.

Trotz, handling the program for San Francisco's Health Department, is sympathetic to these arguments. But on balance, he says, life in the "Housing First" SROs beats the other options available. "Look at the alternatives. Living in a shelter. Living on the street. There's just no way in hell you can get your life together that way."


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