Tag: KCRHA

Regional Homelessness Agency “Right-Sizing” Will Largely Restore Pre-KCRHA Status Quo

The announcement, which will send most homeless service contracts back to the city and county, aims to preserve federal funding at risk after a damning forensic audit and changes in funding priorities under Trump.

By Erica C. Barnett

King County Executive Girmay Zahilay and Seattle Mayor Katie Wilson announced Wednesday that they will transfer the region’s homelessness contracts back to the city and county, respectively, effectively ending the King County Regional Homelessness Authority as it has existed for the past five years.

Most of the region’s homeless service contracts, totaling around $160 million, will transition back to the city and county, where they used to live, by January 1, 2027, with some more complex contracts remaining at KCHRA on at least a temporary basis. As previously announced, the city and county will fund a team of consultants, from a company called Turning Point, to correct some of the major financial issues identified in the audit. The total cost, according to officials, will be under $1 million.

The KCRHA will continue to serve as the region’a Continuum of Care, the entity that applies for and administers federal funds, at least for this year. It will also oversee the Homeless Management Information System, a regional database of homeless people and the services they receive, administer the Point in Time Count of the region’s homeless population, and oversee the region’s severe weather shelters.

“It is not being dissolved, it is being strengthened,” Wilson said at a press conference Wednesday afternoon.

The changes will result in about 20 layoffs at KCRHA right away, officials said, with more to come in the future as the contracts move out. The decision to bring contracts back in-house will also result in some new costs for the city and county, especially while the KCRHA is still providing duplicative staffing, although officials said it’s currently unclear how much and what the impact will be on next year’s city and county budgets.

The KCRHA was recently subject to a damning forensic audit that found the agency had a large and growing deficit and lacked basic accounting standards; since then, the agency has released a “corrective action plan” that the auditors themselves said was  inadequate and failed to address many of their concerns.

The city and county are describing the new as a plan to “stabilize, right size, and reset” the KCRHA.

“This agency was given incredible responsibility without sufficient capacity or authority to really effectively create and drive an overall strategy for addressing the homelessness crisis in our region,” Wilson said at a press conference Wednesday afternoon, “and I think that the audit really reflects this reality—and also, of course, brings to light specific problems that have to be urgently addressed.”

Wilson and Zahilay both said moving all the homelessness contracts back to the city and county does not mean the KCRHA is a “failure” as an agency. “I think the assumption of city and county contracts by the KCRHA was not terribly successful,” Wilson said. “That’s not saying the agency was a failure, but I think that particular part of its function, talking to service providers, that was not a successful function of this work.”

On Wednesday, city and county officials characterized the decision to take back their contracts as a reset that will allow KCRHA to focus on its “true core function” of serving as the Continuum of Care for the region—that is, as the entity that applies for and administers federal contracts.

As PublicCola has reported, the federal Department of Housing and Urban Development issued a Notice of Funding Opportunity this year—the first step in a competitive bidding process for federal dollars—that prioritizes transitional housing and high-barrier programs that include mandatory services over permanent supportive housing and harm reduction.

Because most of the region’s current federal funding (around $67 million) is for low-barrier permanent supportive housing, KCRHA was already likely to lose federal funds; the recent chaos at the agency makes that even more likely. (HUD recently froze all federal funding with LA’s homelessness agency over financial issues that are similar to those at KCRHA).

City and county officials suggested today that moving the contracts back to the city and county would make the city competitive again. “Taking our local dollars back to the county and back to the city really will relieve KCRHA of that additional responsibility of administering those dollars to really focus at this point in time on the changes in the Continuum of Care and that core function,” Wilson’s deputy director for operations, Mark Ellerbrook, said.

The KCRHA was established at the end of 2019 to replace the previous, locally atomized homelessness system with a “regional approach to homelessness.” The agency began administering homeless service contracts in 2022, but never got around to accomplishing its primary stated goal—getting every city in King County aligned behind a coordinated approach to homelessness and issuing new contracts to nonprofit providers as part of a coherent “five-year plan.”  Instead, the KCRHA got mired in a series of ideological arguments and policy missteps, including an aborted pandemic era effort called “Partnership for Zero” that was supposed to end unsheltered homelessness downtown.

The city and county, meanwhile, were never willing to let go of control over what the homeless system looked like—whether, for example, the KCRHA should focus primarily on temporary shelter or permanent housing—and the agency ultimately turned into a pass-through entity for contracts chosen and funded by the city and county. With no taxing authority, KCRHA couldn’t direct homelessness policy in any substantive way, taking direction instead from a series of elected officials with differing political priorities.

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PubliCola has reported in recent weeks on the KCRHA’s oddly blithe response to the forensic audit and the mayor and county executive’s response to its corrective action plan. Both agency CEO Kelly Kinnison and William Towey, the KCRHA’s associate director for strategy, have publicly treated the audit findings as little more than a speed bump, and blamed most of the financial and accounting issues on the way the agency’s budget functions (as a reimbursement system, in which the agency pays nonprofit service providers and gets reimbursed afterward) and previous leadership.

On Wednesday, however, Kinnison said, “As it was launched, [KCRHA] is a failed experiment,” she said.

Given that Kinnison and Towey have largely blamed the agency’s problems on decisions made before Kinnison was hired in 2024, I asked if she saw any of the problems that resulted in today’s announcement as her responsibility. “Absolutely, there are always things I would do differently and prioritize differently,” she said. “Being a newcomer to the region, I think”—Kinnison moved here from D.C.—”was more challenging than maybe I even expected it to be.”

Otherwise, Kinnison said, she came in and took charge of a bad situation by hiring administrative staff and getting the agency into financial shape. If she could have done something different, Kinnison said, she would have “been louder” and “more public” about the agency’s financial issues—”I came in when we were not paying providers on time and people were doing payroll on credit cards”—and lack of finance and administrative staffing. “There’s decisions a reasonable person could have made that would have bene different, but this missing money and construction of the back end [financial system] that didn’t  work—that’s an implementation problem.”

Kinnison also reiterated her claim that she had asked the city to initiate a forensic audit into the agency after she arrived and began identifying problems that occurred under her predecessor, Marc Dones. The mayor’s office says that isn’t true, and that the city (under then-mayor Bruce Harrell) and county (under then-executive Dow Constantine) requested the audit. Simon Foster, the former KCRHA deputy CEO, reportedly also raised concerns about the agency’s finances to the city. Foster was laid off by Kinnison last October, as was KCRHA finance director James Rouse, who was not replaced.

City and county officials, as well as as Wilson and Zahilay, were reluctant to say what will happen to the KCRHA after the contracts move. “That’s what the broad stakeholdering is designed to do” over the coming year, Zahilay said. Kinnison’s future at the agency is also up in the air, and she stood at the back of the room, rather than front and center, as Zahilay and Wilson answered questions. In a joint statement after the announcement, King County Councilmember Rod Dembowski and Seattle City Councilmember Maritza Rivera—who both proposed dissolving the agency earlier this year—celebrated the news. “While this is not a complete dissolution of the Regional Homelessness Authority that we may have called for, it is a major step in the right direction,” they said. “This is a much-needed reset of how we manage our homelessness response.”

 

Report: Homelessness in King County Continues to Grow, with 21 Percent Increase in Unsheltered Homelessness Since 2024

Source: Point-In-Time Count executive summary, KCRHA

By Erica C. Barnett

The King County Regional Homelessness Authority released a high-level summary  of its biennial “point in time count” of the county’s homeless population Tuesday, after a delay of several weeks that gave the KCRHA time to add more context to the numbers in response to concerns from homeless advocates that the news looked too much like doom and gloom.

The KCRHA applies statistical sampling methods to interviews rather than doing a true “one-night count.” The report includes a housing and shelter inventory, which uses on data from the county’s Homeless Management Information System to determine the number of shelter beds and housing units in the system. Unlike most other jurisdictions, the KCRHA does its estimate every two years, rather than annually.

This year, the KCRHA estimated that there are 18,365 people experiencing homelessness in King County, of whom 11,829 were unsheltered. That’s up from 16,868 and 9,810 in 2024, respectively—a nine percent increase in overall homelessness, but a 21 percent increase in the number of people living unsheltered. Additionally, the report found that “the inflow into homelessness continues to outpace exits.” In other words: More people are becoming newly homeless or returning to homelessness than are getting (and staying) housed.

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Specifically, according to the report, around 17,000 people exit the county’s homelessness system, meaning that they stop using homeless services, while around 18,000 enter it.

The KCRHA changed the way it counts the Hispanic/Latino population this. year, which appears to have resulted in a spike in the Latino number and a reduction in the number of “white” people experiencing homelessness. (We’ve asked what accounts for the change). Twenty-four percent of people living homeless in King County identify as Latino (the same percentage as identify as Black), compared to less than 16 percent in 2024.  Every non-white racial group was overrepresented among the homeless population, including Native and Indigenous people, who make up 0.4 percent of the county population but 4.2 percent of all unhoused people in the county.

Overall, the number of shelter beds in the county declined by nearly 12 percent over the past year, going from 5,958 in 2025 to 5,269 in 2026, in part because of a disproportionate reduction in family shelter beds. At the same time, the number of permanent supportive housing units—permanently affordable apartments for people with disabilities, which currently includes severe addiction—increased by 155 last year and 561 in 2025.

A press release from the KCRHA characterized the growth in homelessness as a slowdown in the rate of increase, from 26 percent between 2022 and 2024 to 9 percent between 2024 and 2026. However, as noted above, the increase in people living unsheltered on the streets increased more dramatically than the overall number of people experiencing homelessness, suggesting that the increase in visible homelessness is directly tied to the declining availability of even basic shelter.

Regional Homelessness Agency Says King County and Seattle Owe It $8 Million

KCRHA associate director William Towey at last week’s King County Council briefing

By Erica C. Barnett

Seattle and King County owe the King County Regional Homelessness Authority around $8 million, KCRHA associate director William Towey told the County Council’s committee of the whole last week, referring to the $8 million in spending that, according to a forensic audit, “could not be reconciled” by auditors and “may have to be written off.” The $8 million made up the bulk of more $13 million the homelessness agency had either overspent or could not account for when Clark Nuber released its forensic audit in April.

“Basically, these are the funds that we should have billed to King County in the city of Seattle, and that we didn’t, and we are in the process, in phase one, of completing a cash accounting, which will help us identify what the amounts of those funds are and who they accrue to,” Towey said. A KCRHA spokesperson confirmed that the agency doesn’t know the exact amount they failed to bill for and how much they believe they are owed by the city and county, respectively.

Towey attended the council meeting without KCRHA CEO Kelly Kinnison, who was on a family vacation.

Committee vice-chair Claudia Balducci expressed incredulity that King County may be expected to pay KCRHA additional money, on top of its regular funding and whatever it will cost to untangle the agency’s finances and fix the most critical issues outlined in the audit.

Even if the city and county decide to take over control of the region’s homelessness contracts and shut down the agency, they could end up spending millions winding it down; already, the city and county have committed to funding a team of outside accountants, and KCRHA’s finance committee has recommended hiring seven new staff despite a hiring freeze.

“Did I hear you correctly to say that KCRHA believes that King County and Seattle owe the agency money, and if so, how much?” Balducci asked.

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“Yeah, you heard me correctly,” Towey responded. At some point between 2021 and mid-2025, the years the audit covered, “a situation occurred where we expended funds to providers and failed to bill either the city of Seattle or King County for those expenses,” Towey said.

It’s “not great,” Balducci responded, “that there was an $8 million that was unaccounted for, that now will have to come out of the backs of our taxpayers.”

A spokesperson for King County Executive Girmay Zahilay told PubliCola KCRHA has not provided a bill breaking down what the county “owes” the homelessness agency, but is supposed to complete an initial calculation of its outstanding accounts receivable by June 22.

“Failing to properly bill the city and county does not result in the city and county owing KCRHA $8M,” the spokesperson said. “Because the receivables have not yet been validated or tied to specific costs, it is too early to determine whether there is an existing County funding source or account available to pay any portion of the amount.”

Towey suggested that the $8 million that remains accounted for is as much the county and city’s responsibility as the KCRHA’s, because the two governments should have noticed that KCRHA wasn’t billing them and taken action to make them do so.

“Again, I tend toward being generous, but if I have a great relationship with a vendor, and I want them to come work on my business regularly, and they bill me every month, and I notice that they fail to bill me for some funding, I would probably try and correct that myself,” Towey said.  “Now, that is in no way meant to say that this is not our fault,” he added.

As he and Kinnison have done previously, Towey downplayed the audit findings, saying that since Kinnison was hired, the agency has addressed or is in the process of addressing most of the major issues Clark Nuber identified, such as poor financial management and potential misuse of “cash-equivalent” funds,  as credit cards and gift cards. “In the grand scheme of what this is about, these are relatively small dollar amounts,” he said. (Clark Nuber has strongly disputed the KCRHA’s positive spin on its findings, and urged the city, county, and KCRHA governing board to closely verify every claim from the agency, given its history of failing to follow through on commitments.)

Towey also suggested that the vast majority of the problems the auditors identified were long in the past, resulting largely from inept past leaders, early mistakes, and efforts to respond to homelessness quickly during the COVID pandemic. In “hindsight,” he said, people will look back and say, ‘”Gosh, that could have been done a bit more efficiently, but again the expenses are clearly to the right people for the right things.”

Balducci was taken aback by at the blithe tone of Towey’s presentation, which she called “completely at odds with where my constituents are,” Balducci said. “My constituents think that we are done with this organization. … As policymakers, we all own part of how we got here today. We made some decisions that in retrospect we probably should have done differently. But here we are, and I’m just afraid that this is a sinking ship, and regardless of all the work that’s going in, it feels like fiddling on the Titanic.”

Balducci was “shocked,” she added, that Kinnison didn’t make time to attend the meeting of “one of the organizations that’s going to decide the future” of the agency she leads. “That’s not a good look.”

Committee member Rod Dembowski, who was among the first councilmembers to call for dismantling the KCRHA, seemed more impressed by Towey’s presentation, noting that he had worked with Towey when he was head of Lake City Partners, a North Seattle homelessness agency.

“And so I would just say, William, I’m glad you’re over there at KCRHA, and I hope that your time there is short, and that we can get you over here at the county when that’s done,” Dembowski said.

In response to PubliCola’s questions about whether and how the city will pay the money KCRHA says it owes, a spokesperon responded, “The City, County and KCRHA are in conversation about how to resolve this and other on-going financial management issues at the agency, starting with embedding a financial firm this summer.”

 

Union Urges Wilson to Act After Investigation into Civil Rights Director Concludes; KCRHA Proposes 7 New Hires

1. PROTEC17, the union that represents workers at the city’s Office for Civil Rights, is renewing its call for Mayor Wilson to remove OCR director Derrick Wheeler-Smith from his position after an internal investigation concluded that Wheeler-Smith subjected “a subordinate employee to unwelcome conduct of a sexually explicit nature during a work-related trip,” according to a letter the union sent Wilson and two city council members last week.

PROTEC17 did not provide the investigation report, which PubliCola has requested from the city. For this reason, it’s unclear which alleged incident this finding refers to; as PubliCola reported earlier this year, staff described multiple incidents in which Wheeler-Smith allegedly made inappropriate remarks about women or sex at staff events. SOCR employees also shared misogynistic images they said Wheeler-Smith sent to male staff, including a meme of Kamala Harris suggesting she got the Presidential nomination by giving oral sex.

In February, PubliCola reported on widespread staff allegations against Wheeler-Smith, which included retaliation, financial self-dealing, anti-LGBTQ+ discrimination, and sexually inappropriate remarks and text messages. Staffers also accused Wheeler-Smith of dismissing civil rights issues faced by immigrants, Asian Americans, and other marginalized people.

“The same investigation found it more likely than not that Director Wheeler-Smith made repeated comments of a sexual nature to staff in the workplace, including in front of his leadership team,” the letter says. “The investigator deemed the comments not ‘objectively offensive’ despite the several employees who reported being offended, crediting instead a division director who ‘thought it was a funny story.’ Resolving whether conduct is objectively offensive by privileging those who were not bothered over those who  were is precisely the kind of judgment OCR exists to scrutinize in other workplaces.”

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The findings against Wheeler-Smith, made by an outside attorney who conducted the investigation on behalf of the city’s Human Rights Investigation Unit, were apparently narrow; in its letter, the union disputes some of the findings and notes that the investigation didn’t consider many of the concerns staff raised in calling for Wheeler-Smith’s removal earlier this year. These issues included retaliation and “conduct based on protected characteristics.”

As we reported, employees said Wheeler-Smith was dismissive about LGBTQ+ civil rights, directing staff to remove pro-LGBTQ+ imagery from internal staff publications and complained about former Mayor Harrell’s comments condemning an anti-trans event in Cal Anderson Park.

Wilson’s office did not respond to questions about Wheeler-Smith; we’ll update this post if we hear back.

Wheeler-Smith, who makes a little over $236,000 a year,  has been on paid leave since March. In his absence, OCR has headed up by an interim director, Erika Pablo, but she’s going on leave; her replacement, SOCR manager Mike Chin, will serve as an interim interim until she returns or Wilson makes a decision on the future of the department.

2. The King County Regional Homelessness Authority’s finance committee recommended hiring for seven positions earlier this week, including a senior director for emergency housing services; a senior coordinator for emergency housing; an accountant; a procurement manager; and an IT and operations staffer.

King County Executive Girmay Zahilay’s chief budget officer, Aaron Rupardt, told the finance committee that he supported the hires, some of which could be internal promotions that would not increase administrative spending. It will be up to the entire governing board, made up primarily of elected officials from around the region, to approve the new hires and any new spending they may require.

In a letter responding to a forensic audit that found serious financial issues, including a growing negative balance, at the agency, Wilson and King County Executive Girmay Zahilay both called for

The committee also recommended approving $43,000 in unspecified discretionary spending requested by KCRHA CEO Kelly Kinnison. KCRHA provided a memo detailing the positions the agency wants to fill on Friday afternoon.

Auditor: KCRHA’s Corrective Action Plan Fails to Take Audit Findings Seriously

Editor’s note: This post has been updated to include KCRHA’s responses.

By Erica C. Barnett

Clark Nuber, the firm that conducted a damning forensic evaluation of the King County Regional Homelessness Authority in April, has responded to the agency’s “corrective action plan” (or CAP) with an equally scathing assessment that lays out seven “red flags” that, according to the auditors, the homelessness agency failed to address in its plan to correct systemic financial issues.

The CAP, Clark Nuber wrote, completely ignored several directives from the city and King County, including orders to put a freeze on hiring and spending, and relies on “trust us” assurances that the KCRHA will fix other serious deficiencies. Given the KCRHA’s repeated failure to meet its prior commitments, “funders should not rely exclusively on KCRHA’s self-reported progress,” the auditors wrote. The plan includes “pervasive use of potential hedge language, like: “‘has begun,’ ‘has initiated,’ and ‘will include'” throughout, the assessment found.

“KCRHA also agrees that progress should be independently verified,” a KCRhA spokesperson said. “That is why the CAP itself recommended external stabilization support, and why we welcome the City and County’s intent to embed external financial expertise to support validation, documentation, and implementation. KCRHA is not asking funders or the public to rely on management assurances alone.”

The KCRHA, Clark Nuber found, also continues to insist—inaccurately—that its deficit (currently around $65 million, up from $45 million last July) is the inevitable result of its funding structure, in which the agency pays homelessness nonprofits and gets reimbursed by the city and county. Many large nonprofit and quasi-governmental organizations use reimbursement-based systems, the auditors pointed out, without the kind of steadily increasing negative balance KCRHA has experienced.

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“[The deficit grew steadily and consistently over time, which is the signature of a management process failure rather than an external shock or an inherent feature of reimbursable funding,” the evaluation found. One of the main issues, the auditors wrote, is that KCRHA has routinely submitted invoices late—up to 16 months—which has prevented the agency from getting reimbursed on time.

The KCRHA spokesperson said the agency “accepts responsibility for internal weaknesses that contributed to the problem” of negative balances. “Those are within KCRHA’s control and are being addressed through the CAP. At the same time, resolving the interest obligation and preventing recurrence will require coordinated work with funders on reimbursement timing, advances, working-capital structure, and treatment of accrued interest.”

The “root causes” of the negative balance “included internal factors: the absence of a formal monthly close process, inconsistent invoice preparation and submission, a lack of real-time cash monitoring, inadequate budget oversight, and insufficient internal controls,” the auditors wrote. “These are organizational management weaknesses, not consequences of the funding model itself.”

Overall, Clark Nuber found that the corrective action plan had not fully met any of seven “key dimensions” laid out in the forensic audit, including “KCRHA understanding of issues,” “achievability,” “accountability,” and risk.

The KCRHA spokesperson said, “Several of the issues raised in the assessment are already being addressed. The governance items referenced by the City and County—including spending controls, hiring controls, and a pause on new agreements that increase cost or liability—have been taken up directly with the KCRHA Governing Board and are in place.”

Additionally, they said, the corrective plan says nothing about $6.4 million in  overspending on programs—”the most significant omission in the CAP”—and the growing amount of interest it owes the King County Investment Pool, from which it routinely borrows money. As we noted in our initial coverage, the $6.4 million is on top of $8 million in spending the KCRHA could not account for, $4 million in administrative overspending, and $1.26 million in interest that is “still growing.”

The KCRHA spokesperson said the agency already addressed the $6.4 million in overspending in late 2025 and early 2026.

Clark Nuber also noted that the KCRHA has put off establishing internal financial controls until the far-off Phase 3 of the plan, even though these controls are “not an aspirational best practice,” but required by federal law. “This means KCRHA will be administering significant public funds, including federal awards, without the required control structure throughout the period that is supposed to represent its most intensive corrective action effort.”

The report includes ten short-, medium-, and long-term recommendations for the city and county. It’s unclear whether either government will take the auditors’ adivce to heart; ten days after Clark Nuber published its report, Seattle Mayor Katie Wilson and King County Executive Girmay Zahilay jointly announced plans to “embed” (and pay for) an outside consultant to “ensure [the] corrective actions” in the KCRHA’s plan “are being implemented with urgency.”

Wilson’s office did not respond to questions Wednesday; Zahilay’s office referred us to his statement about the decision to hire a consultant. The new finance committee of KCRHA’s governing board—one of the steps outlined in the CAP—will meet Thursday morning at 10am.

 

City, County Plan to “Embed” Consultant to Address Financial Issues at Homelessness Agency

By Erica C. Barnett

Mayor Katie Wilson and King County Executive Girmay Zahilay both announced that they plan to “embed an independent financial analyst” in the agency, as a statement from Wilson put it yesterday.

According to Zahilay’s announcement, “This analyst will provide more transparency into financial practices, improve payment processes, and ensure corrective actions are being implemented with urgency.” Wilson’s announcement referred to the analyst (or analysts) as “a financial services team” that will “shore up financial and internal controls at KCRHA.”

The decision came after a flurry of discussions late last week about how to respond to the KCRHA’s “corrective action plan,” which laid out a series of steps to respond to a damning audit that found the agency lacked basic financial controls, overspent its administrative budget, and could not account for $8 million in spending. The audit also found that KCRHA had a consistent and growing negative budget balance—around $45 million when the audit concluded, an amount that had increased to $65 million by the time the auditors presented their results.

The announcement represented a slowdown of what had been growing momentum to “wind down” the agency quickly and send the contracts it manages back to the city and county agencies that used to oversee them. It was also a reversal of a plan set in motion last week.

As recently as last Friday, Wilson and Zahilay were planning to announce on Monday that they were taking back the homelessness contracts and distributing them to the city’s Human Services Department and King County’s Department of Community and Human Services,  according to accounts from people familiar with the discussions. (Zahilay, rather than Wilson, was reportedly leading the charge to pull the plug). Homeless advocates, city council members, and some members of the business and philanthropic community reportedly urged caution, and cooler heads apparently prevailed.

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Under the scenario the city and county were contemplating last week, the KCRHA would continue to exist—at least temporarily—as a shell of itself, serving as the region’s Continuum of Care for federal funding purposes and administering the Point In Time Count of the region’s homeless population.

This may still happen; the decision to fund an accounting team to address the problems identified in the audit does not preclude shutting down the agency. But as of now, that will no longer happen on an accelerated timeline.

As we reported last week, KCRHA CEO Kelly Kinnison and Associate Deputy for Strategy William Towey have asked for $500,000 to hire a fnancial consultant—as Kinnison put it, a “CFO-type role”— through the staffing firm Robert Half, which charges hefty recruitment fees on top of their temporary staffers’ salaries. The KCRHA laid off its most recent chief financial office last October and never replaced him.

A spokesperson for Zahilay’s office said the county does not know yet how much the consultant will cost or how the city and county will split the spending.

Wilson’s office did not respond to questions.