Report: Plenty of Blame to Go Around for Ill-Fated Hotel Shelter Program

By Erica C. Barnett

A draft report on a short-lived hotel shelter program run by the Lived Experience Coalition—a group of advocates who have direct experience with homelessness—says the LEC was in over its head when it accepted $1 million in federal funding to run its first shelter program, which ran out of funding earlier year.

But the report, by independent consultant Courtney Noble, also concludes that other factors, including lack of transparency from the LEC’s fiscal sponsor Building Changes and a hostile relationship with the King County Regional Homelessness Authority, contributed to the program’s collapse.

“LEC did not have the capacity to run a direct service program of this scale,” while Building Changes—a small nonprofit that serves as a fiscal sponsor for other groups, including the public-private partnership We Are In— “did not have sufficient capacity to manage the exponential growth in accounting functions necessitated by the launch of the hoteling program,” the report concludes. Meanwhile, “[b]etter coordination between KCRHA and LEC was necessary and possible, but failed to occur due to personalities and expediencies.”

Marc Dones, the KCRHA’s former director, and LaMont Green, the head of the LEC, clashed over the hotel program and many other issues, and Dones went from embracing the LEC to distancing the agency from the group as the relationship between the two entities soured over the past year.

“The essential problem here was poor management of public (FEMA) funding, ultimately necessitating an investment of additional public and private resources” to save the program, the draft report says.

“An error of this margin evinces a complete abandonment of the oversight necessary of any direct service program.”—Draft report on hotel overspending

PubliCola has written extensively about the hotel shelter program, which provided temporary housing for hundreds of people during the pastd winter and early spring. The LEC ran the program using funds from FEMA’s Emergency Food and Shelter Program (EFSP), administered by the United Way of King County and funneled through Building Changes. Earlier this year, the LEC accused Building Changes of withholding critical information about their finances, and Building Changes countered by accusing the LEC of failing to keep its spending in check.

The draft report concludes that as fiscal sponsor, Building Changes (referred to as “BC” in the report) failed to provide timely information to the LEC about its finances, but the LEC should have had some inkling, based on the amount they were spending on the hotels from week to week, that their money was dwindling. “BC can be faulted for failing to provide regular financial reports,” the draft report says. “However, the hoteling program staff and LEC Leadership should have also been monitoring their expenditures in real time. An error of this margin evinces a complete abandonment of the oversight necessary of any direct service program.”

The LEC, Building Changes, and the United Way of King County declined to comment directly on the draft report. In a joint statement, the three organizations said, “We do not believe it to be productive to litigate the findings of this report nor resurface prior grievances regarding the actions or inactions that led to it. … All parties have acknowledged that there are areas for improvement and we have all taken steps toward that joint effort – both within our individual operations and among the coordinated efforts between us.”

One issue the report raises, but does not dwell on, is the question of whether the local Emergency Shelter and Food Program board, which is administered by a staffer for the United Way of King County, should have issued the million-dollar grant to the LEC in the first place. According to the report, the hotel program wasn’t actually eligible for EFSP funding, which was reserved for existing programs, not new ones. “As implemented, this was not an existing program, and should not have been eligible for this funding,” the draft report says. Complicating matters, the LEC itself holds five of 19 seats on the local board that chooses who gets funding through the EFSP program, creating “the appearance of self-dealing” even though LEC members recused themselves from the vote that resulted in the grant.

A spokesperson for the KCRHA said the draft report “captures some of the challenges of coordinating across our homeless response system, and the importance of trust in leadership and clear communication.”

In late April, the KCRHA unceremoniously took over the program, using state funding, its own money, and a contribution from We Are In to keep hotel guests in their rooms while transitioning them to other locations or, in some cases, back to the streets. This abrupt takeover created more ill will between the KCRHA and LEC, as the two organizations clashed over access to client information and other issues; ultimately, the KCRHA created (and took credit for) creating its own “by-name list” of people living in the hotels, a group the LEC already knew intimately but whose information they would not share with the homelessness authority without explicit permission from each client.

The report concludes that the homelessness authority and LEC could probably have worked out their differences, but “[p]oor communication and hostility between organization leaders” made it all but impossible for the two groups to work together.

The KCRHA has consistently claimed it knew next to nothing about the hotel program, even as the agency’s own “systems advocates”—case managers with lived experience of homelessness, including some from the LEC— were moving KCRHA clients into the hotels as part of the We Are In-funded Partnership for Zero program, which aims to eliminate homelessness in downtown Seattle.

“There are many fractured relationships, historical grievances and mistrust between parties,” the draft report says, and “[s]ome sort of mediation or reconciliation is necessary between KCRHA, BC and LEC.”

The draft report is skeptical about this claim. “While KCRHA leadership may claim they were unaware of the program, there were clearly many points of intersection between KCRHA and LEC on this work,” the report says. However, the report also that under We Are In’s funding agreement, system advocates were supposed to use available resources like the LEC hotel program before tapping into We Are In’s funding. This meant that system advocates—under pressure from KCRHA and the city of Seattle to show progress reducing visible homelessness downtown—came to rely heavily on the LEC program, ultimately moving 121 people into the hotels.

Half of We Are In’s board are members of the LEC or people appointed by the LEC. We Are In declined to comment for this story.

The LEC played a key role in the creation of the KCRHA, whose charter document cites the LEC as a co-author of the agency’s mission statement and theory of change. Over its first two years, the KCRHA deepened the entanglement between the two organizations, granting the LEC unprecedented authority to appoint members to the KCRHA’s governing and implementation boards, directly appoint the agency’s chief ombudsperson and hire some of their staff, conduct the annual “point in time count” of the region’s homeless population, and appoint members to the region’s homelessness continuum of care committee.

Although this relationship gave people who have actual experience being homeless an unprecedented voice in decision making at the authority, it also created the potential for huge problems when conflict inevitably arose between the two partners. “There are many fractured relationships, historical grievances and mistrust between parties,” the draft report says, and “[s]ome sort of mediation or reconciliation is necessary between KCRHA, BC and LEC.”

The report is still in draft form and will be amended in response to “factual” feedback from the LEC, Building Changes, and the KCRHA, before it’s finalized and released later this week.

18 thoughts on “Report: Plenty of Blame to Go Around for Ill-Fated Hotel Shelter Program”

  1. The saddest part of this incident, is how emblematic it is about why we can never fix homelessness, no accountability. There is a culture within the Homeless Industrial Complex that is sort of goes like this, “we are all trying real hard to do SUCH good for humanity that we should be granted infinite latitude to make mistakes and misspend public funds” (this includes lining a lot of peoples pockets and greasing a lot of palms). These four prominent organizations, KCRHA, LEC, BC and United Way, clearly have done considerable kumbayaing, likely at some trilateral retreat, wait for it,…….. paid for by tax dollars, and back patting in order to come up with this collusive public response; telling us that “you can all go home, there’s nothing to see here”. And now they plan to go back to “business as usual”.
    This the way it works/fails folks, no one in the Homeless Industrial Complex is ever held accountable and a lot of people make a lot of money on the backs of the most disenfranchised individuals in American society, the homeless. At its inception, 2 years ago, KCRHA should have fired every one of the over 250 King County homeless organizations and required that they all reapply for funding by demonstrating valid (leading to housing) measurable metrics for accountability. Misspending money is the least of our problems. Misguided plans and policies that don’t get people into housing are much more pernicious. Unless we figure out a way to hold organizations accountable to their efficacy in fixing homelessness we are doomed.
    I personally would like/need to see heads role here, if for no other reason, to help me retain what little hope I have left, that we can really figure out how to fix homelessness.

    Bruce Drager
    Greenlake Homeless Advocates

    1. Your notion that 250 organizations that are currently providing services should just have been fired outright is simply idiotic.

      KCRHA proved that standing up an organization to “simply” take over contracts from King County and the City of Seattle Human Services Department is a whole lot easier said than done (their start-up glitches, late invoice payments, hiring and onboarding staff, etc etc are well and amply documented).

      Your BS construct that you can just “fire” a ton of agencies that are currently up and running and providing actual (if imperfect) services and replace them with nebulous new organizations that will still have to do their initial organizational set up (business registrations/establishing IRS tax ID’s/State Unemployment and L&I accounts/etc etc ad naseum not to mention the difficulty of hiring and onboarding staff in a mileau that isn’t exactly conducive to doing so) is a lot of glib crapola.

      1. Making excuses for the ridiculously poor performance of all of them, from KCHRA on down is also “a lot of glib crapola.” Why you would defend what’s going on is beyond understanding.

      2. I’m pointing out that this is a complicated system in a complicated world and that saying you can change that overnight is glib and disingenuous.

        What do you do for a living? Are you an expert in anything but pissing and moaning?

      3. Maybe “fire” might be a bit heavy handed but, you get the idea. Bottom line, after encountering, and working directly with many of them, I’m convinced that, at the very least, they all need to “come to Jesus” and reevaluate their goals and processes, that, for the most part, don’t contribute significantly to fixing homelessness.

    2. Thanks for the post Bruce!

      Let’s keep this simple. New low income housing integrated with a support system costs at least 400-500k per unit to build and more cash to run after that. Drug treatment starts at $7000 per person (28 day program) and goes up from there. Homelessness isn’t a problem with a cheap easy fix.

      Right now Seattle doesn’t have enough supported low income housing or drug treatment beds, so the smart money would work on getting more.

      Stupid money would spend millions on hotel rooms for the homeless and dump them all back on the street, no better off, when the money runs out…. and the money always runs out. Look at the current City budget. The money has done run out.

      I believe that the homeless deserve much better than the likes of the United Way and KCRHA. Where’s the real housing? Drug treatment? Actual community investment? Because what the Homeless Industrial Complex does now is pay people crap wages to wander the streets handing out socks and NARCAN. The hotel room scheme was just another complete bust. Own it and move on.

      Finally, let’s roll this back. Let’s say the damn hotel room mess would have never happened? Did spending millions of dollars actually help anybody long term? So if the City government cut funds to half the “non-profits” who provide “service” to homeless, would it even matter? Let’s fire 50% of the Homeless Industrial Complex and use the money to build….wait for it kids…. low income housing!

      1. I can tell you for sure, 100%, the hotel program provided the shelter needed for someone I was working with, giving me the time to secure permenent supportive housing for them, and thank God they are doing well now on their path of recovery.

        You use the phrase “Homeless Industrial Complex,” a phrase coined by the same folks that use such phrases as “Libtard” “Snowflake” and “Let’s go Brandon.” Thanks for showing your true colors.

    3. Bruce – I appreciate your correction/clarification – words do matter.

      IMO – the reason we will never “fix” homelessness is that it can’t be fixed – it can only be managed.

      KCRHA’s mission statement of “ending homelessness” was doomed to fail from the start – and their theory of change that says that if we listen to those who have experienced homelessness and do what they tell us to (hence the exaggerated and misplaced role of the LEC) we will somehow “end” homelessness is also fatally flawed.

      I’ll settle for getting people into shelter – including congregate shelter and tiny houses, etc – which the KCRHA dismisses and looks to defund in a mileau in which permanent housing units would never be enough to satisfy the need even without the overheated and insanely expensive real estate market in which everyone who isn’t a bajillionaire struggles already.

      Better that folks should be indoors than sleeping and shitting in some small business owner’s doorway. When I started in my job bednights were the primary outcome that was measured for shelter providers – and changing that measurement to how many people are permanently housed was a function of HUD changing their model based on a limited success story in Utah where it was a much smaller and easier to house population of veterans. In my view, that mostly just kicked the can down the road by a fiscal year or two so they could declare some sort of victory – never mind the fact that a lot of chronically homeless folks will become homeless again the moment their housing subsidy funds run out.

      PS – I am in the minority when it comes to most other service provider folks when it comes to so-called “sweeps” of long-term encampments/vehicles/etc – I think they can and should occur.

      1. Well, I think much of the West coast homeless problem is going to largely be curtailed in the next 5-8 years. Right now it costs 25k a year to lock up somebody in for-profit prison (In Texas, cheaper yet in Mississippi) . I believe the Republicans will, sooner or later, make fentanyl a federal crime, so when those “sweeps” happen, drug addicts will go straight to the slammer. Mayor Bruce would pay $25,000 a head to get rid of his “3rd Ave problem” and call it money well spent.

        Of course there will be protests about the new “war on drugs” but most of the population will be so sick and tired of the whole fucking mess they’ll be glad to see it gone. Does the Homeless Industrial Complex really believes the tax payers of Seattle are going to keep funding homeless services at this level for decades…. without any real progress? Public goodwill is going to run out at some point.

  2. Maybe it’s time for a real reckoning on what “lived experience” really means and what it can do. Yes, the lived experience of folks who’ve been homeless can help inform changes to policies and programs. But we also need to acknowledge that the “lived experience” of people who know how to track budgets, write reports, manage employees and administer programs within government bureaucracies matters a lot, too. We don’t assume someone with a career as, say, a grocery clerk, engineer or actor would make a good supervisor of a homelessness program,

    1. Agreed 100%. And as a side note, in my view gutting the contract management divisions at HSD and King County to move all of those functions to KCRHA was a tragic mistake that Dow Constantine and Jenny Durkan both need to own.

  3. “The LEC, Building Changes, and the United Way of King County declined to comment directly on the draft report. In a joint statement, the three organizations said, “We do not believe it to be productive to litigate the findings of this report nor resurface prior grievances regarding the actions or inactions that led to it. … All parties have acknowledged that there are areas for improvement and we have all taken steps toward that joint effort – both within our individual operations and among the coordinated efforts between us.”

    This is rich! Let’s not talk about it because we’ve ripped you off, the money’s all spent, and we have nothing to show for it so let’s just move on, and btw, please give us some more money.

    Who the h*() are these people, anyway??? Marc Dones was a joke from the start, yet the true believers hired him at a princely pay rate. Giving people who’ve got “lived experience” living on the streets–what could ever go wrong there with people that demonstrably couldn’t manage their lives already? So we should give them our hard earned money and expect that they will spend it wisely? Who’s great idea is that? It’s laughable on its face.

    If the electeds want to know why we don’t want to spend any more money on this and why we want to clean house of them, this would be a place to start looking at the reasons. We are throwing good money after bad out in the streets for anyone to grab with no accountability and no guardrails. WTH???

    Sick of this!

    1. The notion that “we don’t know where the money went” and “have nothing to show for it” is misplaced in this instance – it paid for actual hotel rooms for actual people. The real issue is that it was given to an agency that had no experience or financial acumen to do this task, which resulted in the creation of false expectations that the program would be able to continue indefinitely – and more importantly that the LEC had no idea when the money was going to run out as a result they left a lot of the people they had temporarily housed scrambling at the last minute to find new places to go.

      These are significant issues, to be sure. I’m gonna out myself here – I was the lone member of the EFSP Board that raised concerns when these funds were proposed to be awarded to LEC. I wound up voting for it when I heard that Building Changes would be the fiscal agent for LEC, as they are a large and experienced agency that I believed had the capacity to handle the accounting (and from an EFSP Board perspective, the Federal reporting that is required to close previous funding phases so future funding can be released to the many agencies that receive Emergency Funds for Shelter Programs aka EFSP funding). In retrospect, I guess I get to say “I told you so” – but get no joy from doing so.

      That being said, for the record, it was strongly implied that since KCRHA was elevating the role of LEC folks in their planning the funds we were asked to approve for LEC was in keeping with their goals – but it was never explicitly stated by the United Way staff member (a solid professional who I respect and believe is competent, honest, and well-intentioned) who administers this program that they had requested that we do so.

      PS – I work for a small agency that receives EFSP funds and not for any one of the agencies named in the audit, so I have no axe to grind and am just setting the record straight here.

      1. Yup. In all of that, what I get is no accountability and it was nobody’s fault, let’s move on–pretty much the quote I pulled from the article said in other words. Not sufficient, not acceptable.

      2. Pat – I think you’re kind of an idiot for the most part, but don’t disagree with your assessment of the response from Building Changes/KCHRA/United Way in this particular matter.

  4. The KCRHA claiming they have no knowledge of the internal workings of the LEC, even if true, seems like an admission of failure. A stated goal of the KCRHA is to consolidate response under one authority, yet it knew ‘next to nothing’ of the program? They didn’t think to find out more? I can’t help but think of the two Bobs in Office Space asking “What would you say you do here?’

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