Raleigh's bold new approach to ending homelessness: 'Cautiously optimistic'

RALEIGH, N.C. (WTVD) -- The City of Raleigh is trying a new approach to reduce homelessness. They're planning to give unconditional money directly to people who are trying to transition out of homelessness, and hope that they spend it in a way that keeps a roof over their heads.

It's worked in other cities.

In Houston, they've managed to decrease homelessness by 64% during a 12-year period. The program has also saved the city money in the long run, because giving people housing assistance is cheaper than the costs the city accrues for someone who is chronically homeless.

"Their unsheltered homelessness response saves the community $76,000 per person," Raleigh Housing & Neighborhoods Department Director Emila Sutton said about Houston's program. Dallas and Philadelphia have had success with a similar approach too.

From data gathered in 2017, it's estimated that each person who is chronically homeless in Raleigh costs the city $35,000 per year. Sutton said that number is probably even higher now.

"The costs are from expenses associated with shelter stays, which is very expensive, jail stays, emergency room visits, and hospitalization," Sutton told ABC11, emphasizing that not a single dollar from that cost goes toward a solution to ending homelessness.

The City of Raleigh estimates they'll spend about $32,000 in a one-time cost to build or repair an affordable housing unit when the program is getting off the ground, and then $18,000-20,000 in rental assistance per household per year as part of this program. If the program works as designed, it should save the city thousands of dollars a year, while also providing a solution to homelessness in our community.

Now, the rental assistance portion of the program is where things get more controversial. The money would go directly to the renter, rather than to the landlord.

Diana Powell, Executive Director of Justice Served NC, works to help hundreds of people in our community find a safe place to sleep when they have nowhere else to go. She believes the program's concept is a good one as long as it operates as advertised.

"We are definitely in a homelessness pandemic and it's growing every day," Powell told ABC11, adding that she's cautiously optimistic about the city's program.

Powell and the City agree on at least one thing. The biggest cause of homelessness is loss of income and rising housing costs, so giving people money and making housing more affordable is the best solution to tackling the problem.

"They're not looking for a handout. They're just looking for a hand up, because the majority of the people that we're working with, they do have jobs it's just not enough to sustain them," Powell said.

However, Powell is concerned about the money from the City going to program participants directly with no conditions, saying that people who have reached out to her organization for help have occasionally had bad intentions.

When ABC11 asked the City about this, they said giving money directly to program participants in other cities has been a successful approach.

"In all the studies that provide this direct assistance to folks, there has been no increase in purchasing what are called "temptation goods", so things like alcohol, illegal substances, gambling," Sutton said, "a large majority of people are spending on housing, on transportation, on child care, on personal hygiene, on things that people just need to live."

Sutton also made a point to clarify that this program is not technically a direct cash transfer or guaranteed income.

"This is housing assistance. So, we are going to be working with people to transition them into permanent housing and helping them link to permanent housing. It's just that the rent assistance is going to go to the household instead of the landlord," Sutton said. "I think it can work in a lot of different ways. The city is going to contract with local service agencies for pilot implementation. So I think they're going to really help with engaging potential pilot participants with administering the subsidies and figuring out what works best for folks."

The City is also planning to hire a consultant who will help with implementation.

"This will include the development of a prioritization tool to help identify camps that will be prioritized for pilot participation," Sutton said about how the program participants will be chosen.

On top of providing regular housing assistance directly to program participants, they plan to also set them up with fallback funding as well.

"We know that providing folks with savings and checking accounts is also a really useful tool, and we know that people who participate in these types of programs build their savings, and so we also want to provide that long-term pathway for financial stability," Sutton said. "So, they will purchase things that they don't have currently living outside, such as kitchen items, a bed mattress, things like that, but then also if there is some sort of crisis that comes up again, there's a small reserve of savings that they could come back to for that."

Sutton is hoping this program and the research behind it might help combat some of the misinformation about people who experience homelessness.

"It's so interesting. There's that large mythology about how people are resistant to help and that they are choosing to live outside, and in fact, we know just most recently from the city of Dallas who have housed over 3,000 people in the last three years using a similar methodology that over 95% of folks who were offered housing accepted housing," Sutton said. "So by and large, people want to be housed and they will accept services and housing."

The program is also not designed to provide housing assistance permanently, but the goal is to provide help transitioning out of homelessness to at least 40 households.

"The pilot will provide finished financial assistance to participating households for up to two years. We designed it this way because we know that from the research on something called rapid rehousing, which provides assistance for up to two years, that this shorter-term assistance is all most people need to get back on their feet," Sutton said, adding that they do also have a solution for people who may need assistance for a longer time and have already started conversations about how to provide longer-term assistance.

Powell said she's received countless calls and texts from people about this program, hoping to be able to utilize it to transition out of homelessness. She said she's very hopeful the program will work as advertised but will keep a close eye on how the City ultimately implements it.