Mayor’s Office Says Hotel Shelter “Service Costs Are NOT Eligible” for FEMA Funding; Shelter Providers, and FEMA Guidelines, Disagree

By Erica C. Barnett

On Tuesday, the Seattle City Council continued to seek clarity on why Mayor Jenny Durkan’s office has not sought to fund hotel-based shelters with funding from the Federal Emergency Management Agency, which recently announced it will reimburse the cost of such shelters, with exceptions for non-shelter services such as case management, at 100 percent. (Previously, FEMA reimbursed for 75 percent of eligible costs, but President Biden increased that amount to 100 percent and made it retroactive to January 2020).

As PubliCola has reported, the City Budget Office, which answers to the mayor, sent a memo to the council late last month outlining a series of objections to funding hotel shelters using FEMA money. Most of the objections related to administrative headaches and hurdles associated with applying for funds. However, the memo also claimed that FEMA “is not paying for any services,” and that such “services” at shelters typically cost between $18,000 and $25,000 a year.

Deputy mayor Tiffany Washington reiterated this point in an email to members of the city’s volunteer commissions this week that explicitly said PubliCola’s reporting was “inaccurate and misleading.” (We stand by our reporting.) “While facility costs (the actual hotel rooms) and operations costs (like security, cleaning, and meals) are eligible, service costs are NOT eligible,” Washington wrote (emphasis hers), and reiterated the $18,000 to $25,000 figure.

Reimbursable items, according to FEMA’s guidelines, include “shelter management,” “health and safety,” “medical staff” “personal assistance service staff,” and other “support services” needed to operate a shelter. 

In fact, FEMA’s own guidelines for non-congregate shelter options during COVID lay out exactly which “shelter services” the agency covers, and they are not limited to “the actual hotel rooms” and operations costs associated with running a bare-bones hotel. (As a city council staffer put it Tuesday, “just leaving them there without any interactions and just dropping a meal off now and then” does not constitute a shelter).

Accordingly, reimbursable items, according to FEMA’s list, include “shelter management,” “health and safety,” “medical staff” “personal assistance service staff,” and other “support services” needed to operate a shelter.

Low-Income Housing Institute director Sharon Lee tells PubliCola this shouldn’t be news to the city; FEMA has already paid for multiple tiny house villages and one enhanced shelter facility that LIHI opened in response to the pandemic, “and there were only a small number of items that they didn’t cover.” (This was during the period when FEMA only reimbursed 75 percent of costs.) Among the items FEMA covered, Lee said, were “office supplies, education expenses, client assistance… all operating costs, and the rest of the staff” who were not engaged in direct case management.

Case managers and behavioral health counselors also make up only a small minority of the staff that will be working at one of the hotel-based shelters that city plans to open using Emergency Solutions Grant (that is, non-FEMA) funding later this month.

According to Chief Seattle Club operations director Virgil Wade, the shelter CSC will operate at King’s Inn in Belltown will have between 10 and 13 staff, including three case managers, to “monitor and assist the clients” living in “about 60 rooms” at the 66-room facility. Consistent with LIHI’s experience operating shelters for people vulnerable to COVID infection, the majority of staff fall under the categories the FEMA guidelines define as reimbursable, assuming all other conditions are met.

According to Low-Income Housing Institute director Sharon Lee, FEMA has already paid for multiple tiny house villages and one enhanced shelter facility that LIHI opened in response to the pandemic, “and there were only a small number of items that they didn’t cover.”

Like other service providers we’ve spoken to, LIHI’s Lee said it’s unclear to her why the city hasn’t gone after more FEMA funding for these services at other kinds of shelter, such as hotels. “We’ve been urging the city and other jurisdictions to make better use of FEMA, but we do know that there’s some hesitancy,” Lee said.

Asked about FEMA”s list of reimbursable services, Durkan chief of staff Stephanie Formas responded by reiterating that the city is seeking reimbursement for “eligible items like meals and security” at other shelters, but not “behavioral health, case management, and mental health.” This does not, unfortunately, answer the question about FEMA’s list of reimbursable services that are not on this concise but ill-defined list.

Formas added that the mayor’s office doubts that every single client being sheltered by the Public Defender Association’s JustCARE program—in the news lately because its funding from King County runs out in less than two weeks—would be considered vulnerable to COVID under FEMA’s standards for reimbursement. That’s a matter of debate on which the mayor’s office and service providers have taken different sides, with the mayor’s office using it as one of many reasons not to try for federal funds and service providers urging them to do so.

In response to the PDA’s requests for city funding to extend JustCARE, which currently provides shelter for about 130 people who would otherwise be sleeping on the street, the mayor’s office has characterized JustCARE as a “county program” that the city has no obligation to fund. In her email, Deputy Mayor Washington said that although county funding for JustCARE is set to expire on March 15, King County “Executive Constantine and King County Council are committed to extending the program through June without using City funds to ensure current program participants are not exited back into homelessness.” Spokespeople for Constantine and the county Department of Community and Human Services were not familiar with any such commitment when PubliCola contacted them on Tuesday; PublICola was awaiting additional clarification as of Thursday evening.

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One thing that has been consistent about the response from Durkan’s office to questions about FEMA reimbursement, from service providers and other elected officials as well as reporters, is that it has consisted almost entirely of a list of reasons the city has not sought reimbursement from FEMA for hotel-based shelters, either for “hotels themselves,” as Washington put it, or for the kind of services FEMA will pay for. Formas reiterated some of these in her email to PublCola.

Consider a different scenario, in which the mayor of Seattle had decided to open hotels last March (or at any point since) and asked FEMA to reimburse the costs. In a worst-case scenario, FEMA could raise the kind of objections the mayor’s office is raising now: Perhaps some shelter clients didn’t have any underlying conditions that made them vulnerable to COVID, for example, or a provider asked for money in error for some service that FEMA wouldn’t cover. The city would then have to find a way to cover those costs.

Even in this worst-case scenario, the result would be that more people would be indoors—safe, sheltered, and less vulnerable to a disease for which living unsheltered, without access to hygiene, is a known risk factor. One could argue that accomplishing this goal, with a pandemic raging, is worth the risk that the city will have to shoulder some of the burden. In fact, many outside the mayor’s office have been making that argument for the past year.

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