The mood in city hall was upbeat last week, when Portland City Council set into motion a plan that could see 2,000 units of deeply affordable housing sprout up in the city during the next decade.
As we reported at the time, the minor step of studying how to expand so-called “supportive housing”—in which cheap rents are paired with social services—is seen among some as a sign the City of Portland, Multnomah County, and others will ultimately support those new units, and therefore shift their focus to housing people who are exceedingly difficult to house.
But while there’s widespread acknowledgment this effort will be costly, not many people are offering specifics. Which is odd, because they’ve been available for months.
According to an analysis completed earlier this year by the New York-based Corporation for Supportive Housing, creating and operating 2,000 units of supportive housing would cost roughly $300 million over 10 years. And once the housing’s all established? It’ll cost $41 million a year to operate, the analysis suggests.
That’s a lot of money—more than local governments or the city’s housing authority, Home Forward, have to throw at the matter. Officials haven’t been shy about previewing the fact they’ll be seeking new revenue to fill gaps in funding for this push. The only question is where they will look. (Mayor Ted Wheeler has said he doesn’t want a property tax increase, and there’s some interest around a cell phone tax.)
The CSH analysis is built on a set of assumptions—for instance that roughly 1,200 of the supportive units will
be built into new projects, while the remaining 800 will be come in the form of existing units in the community.
Heather Lyons, the Portland-based director for CSH who authored the document, tells the Mercury those assumptions came from speaking with local officials about what kind of mix they’d like to see.
Lyons’ analysis suggests roughly $184 million of the $300 million estimate would go toward “capital costs for building new units.” The rest would go toward operating, paying for social services, and leasing.
Not all of that would need to come from new taxes and fees.
“There are existing resources for services that can be matched to housing, and there is existing housing in the community that can have services attached,” the document says. “Moreover, a wide-ranging coalition of systems and partners, well beyond the City of Portland, Multnomah County and Home Forward, will pool their resources to sustain this system over time.”
On top of that, Lyons and others argue that supportive housing ultimately offers cost savings to communities, reducing visits to the Emergency Room and hospital stays, as well as cutting down on law enforcement costs.
“Supportive housing has been rigorously tested for more than two decades, and the results are clear: It improves lives and communities and reduces costs,” the analysis says. Lyons tells the Mercury she’s hoping to get grant money that would enable CSH to study what sorts of savings might be possible here.
Meanwhile, local officials have discussed finding a way to funnel cost savings back into the ongoing costs of operating this kind of housing. It’s unclear how that would work.
Here’s the full report.
CSH Cost Estimate 2,000 Units (PDF)
CSH Cost Estimate 2,000 Units (Text)
And when we fill those 2000 units up in the first year, and more homeless move to Portland to take advantage of the generous services the city offers, where will that money come from? And the 2000 after that, and after that? Helping people is great, but homelessness is not a problem Portland will ever be capable of “solving” on its own, which means we also need to start looking at new laws and rules that make our city cleaner and safer again.
The City general fund is $600M per year. The County health, human, and community services budget is about the same.
The $184M would be bonded – costing maybe an additional $10M/year out of an about $250M a year City bond fund servicing budget.
That leaves $116M spread out over 10 years. That’s a nit if it can end street camping. $12M a year? The City is asking $7M/year for additional officers alone – would they even be necessary with people off the streets? What other City costs could be reduced if we solved this? What would be the value to businesses and residents?
A financial and benefit analysis presented in an interesting way could be a feature article.
R – will it save money if 2000 people get taken off the streets only to be replaced with 2000 new homeless transplants who relocate to Portland to take advantage of our homeless services? That’s the biggest problem with all of this – Portland is not a closed universe. Unless all other cities undertook similar programs simultaneously, Portland will simply spend a lot of money to become more attractive as a destination for the homeless. You see the same thing happening down in Los Angeles. More people housed every year, yet somehow also more homeless every year.
Ignoring the ridiculous $300M startup cost. How do 2,000 units cost $41M per year to maintain?? That’s over $20,000 per unit every year. Even if all of these units are completely free to the users instead of being just subsidized, the city is basically paying $1700/month in “rent” for each unit. Why don’t we just give 2,000 families $1500/month for use on housing? They could probably find better housing and the city saves money.
I understand I am oversimplifying, but at some point we need to start tracking where this money goes. I’m fine to pay more in taxes to help the less-fortunate, but if the money is just wasted, then who is actually being helped? At what point would we be better served just handing people cash instead of creating these massively costly government-run projects?