L.A. Controller Finds Prop. HHH Plagued by Rising Costs, Long Delays; Urges Action to Rapidly House the Homeless

LOS ANGELES — Today, L.A. Controller Ron Galperin released a 2020 report, “Meeting the Moment: An Action Plan to Advance Prop. HHH,” on the performance of the City’s voter-approved $1.2 billion bond program aimed at reducing homelessness by creating up to 10,000 units of housing, along with interim shelters and storage facilities. Galperin first scrutinized HHH in October 2019 and recommended reallocating funds from high-cost projects to lower-cost projects and cutting red tape to speed up permitting.

Since then, homelessness has jumped 16 percent in the City of Los Angeles to 41,000 people, and thousands of people have died on the streets, including 865 as of the end of August 2020 — 30% more than the same period last year). Some communities — particularly L.A.’s Black and Native American populations — are disproportionately impacted by homelessness and not getting the help they need with HHH. In his current report, Galperin found that long delays and continually rising costs have hampered the HHH program’s success. He called on City leaders to adopt a simple, short-term action plan to utilize the remaining bond funds and provide more immediate relief to people experiencing homelessness.

“Nearly four years after voters approved spending a billion plus dollars to reduce homelessness, only three new housing projects are open and most won’t begin welcoming homeless Angelenos for two, three or even four more years,” said Controller Galperin. “Meanwhile, the crisis has gotten far worse, compounded by pressing COVID-19 health and safety concerns. To truly reduce homelessness as L.A. voters intended, the City must meet the moment by pivoting to an action plan that will house more people right away. We cannot stay the course when people are dying every day on our streets.”

Long delays, rising costs hinder progress

HHH projects are currently taking between three and six years to complete and some developers have asked for extensions ranging from 42 days to more than a year. At this pace, nearly 80% of all units will not open until 2022 or later. Even when every HHH unit is built, tens of thousands of Angelenos will still lack a roof over their head — highlighting the need for a more strategic approach to using the remaining tens of millions in HHH funds.

If nothing changes, delays will continue, costs will keep rising, and the unhoused population will climb. Since 2019, the average per unit cost of HHH projects in pre-development (prior to construction) increased from $507,000 to nearly $559,000, with the highest per-unit cost jumping from $700,000 to $746,000. One-third of these units cost $600,000+, and the highest total cost for a single project exceeds $76 million.

Action plan needed

Galperin urged the City to explore reallocating funds from high-cost projects to lower-cost projects, and to better use the remaining $30 million in HHH funds, along with any additional money returned from unsuccessful projects, by:

  • Building more interim housing and facilities to rapidly get thousands of people off the streets while supportive units are built. This will help meet health, hygiene, sanitation and storage needs for the unhoused population.
  • Repurposing existing buildings (adaptive reuse), like hotels/motels, and unused commercial and office space that could be far cheaper and faster to convert into homeless housing.

Mapping HHH projects, costs

Along with the report, Galperin created a story map with graphs and interactive maps showing the cost and status of the City’s 111 HHH projects. Users can click on a pin to view information about each project, including the developer’s name, the cost, the development status, and the total and per-unit HHH amount associated with it.

Explore the HHH report and story map at lacontroller.com/hhhactionplan or https://lacontroller.org/audits-and-reports/hhhactionplan/

Follow L.A. Controller Ron Galperin at @LAController on Twitter, Facebook and Instagram.

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