Investing in our country’s infrastructure is all the talk today, from Los Angeles to D.C. The quality of our roadways and bridges is indeed a national crisis, but there is a human element that has been neglected. The lack of housing and service infrastructure for people struggling with poverty has created the worst homelessness crisis in recent memory. 

We see the crisis first-hand in Los Angeles, where homelessness is visible and growing at 57,794 people at last count.

But there is hope.

The County and City of Los Angeles did not wait for a federal initiative to address our homelessness infrastructure capacity. Last year’s approval of Proposition HHH will give the city $1.2 billion to invest in efforts to build 10,000 apartment units for people who are homeless. The county approved Measure H, which will invest $355 million per year, for ten years, to provide homeless services.

I have seen numerous county and city homelessness initiatives come and go over the 20 years that I have been leading PATH, People Assisting the Homeless. This is the first time that leaders not only proposed a plan to house people, but backed it up with real dollars.

An investment of billions of dollars for housing and services is just one part of the solution, though. We also must invest in the nonprofit agencies that are on the front lines of homelessness in our communities.

Much of the resources from HHH and H will fund community groups throughout the region. These agencies will send outreach teams to the streets, prevent people from becoming homeless, build new apartments, and provide support to formerly homeless people who are now housed. What these new resources do not cover is the cost of actually running a nonprofit agency, resulting in an operations gap.  

Helping a person get off the streets and into an apartment does not simply mean hiring outreach workers or case managers that are typically funded by grants. What also is needed, and not funded, are the unseen costs behind any organization of scale –the costs associated with setting up a service space, hiring financial clerks, HR workers, and an IT team.

There are also “Costs of Delayed Payments.” Most government contracts are paid “after-the-fact,” meaning an agency spends a month’s worth of salaries and program costs and then later bills the funding entity. This often causes a delay in payment for somewhere between 30 days to six months. 

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