A Home for All Strategic Framework: What’s the Cost? Part 1

Released in January 2022, A Home for All: Charlotte-Mecklenburg’s Strategy to End and Prevent Homelessness – Part 1: Strategic Framework reflects the community’s work during the past year to develop a comprehensive, transformative strategy to address both housing instability and homelessness. As the first document to be released from this effort, the Strategic Framework provides the roadmap for the work ahead. The framework serves to outline the vision and major objectives across each of the following nine areas: prevention; shelter; affordable housing; cross-sector supports; unified policy advocacy; coordinated funding alignment; innovative data and analytics; communications; and long-term strategy.

Previous blog posts have plunged into the recommendations of the four “what” workstream recommendations that correspond to a part of the housing continuum in the Strategic Framework: prevention; shelter; affordable housing; and cross-sector supports.

The Strategic Framework did not include an itemized list of expenditures nor a big-ticket funding request of any body. This was absolutely deliberate. Funding recommendations will ultimately be offered as part of the implementation plan. Of course, however, one of the biggest topics of discussion has been, and will continue to be: “What does it cost to end and prevent homelessness?” Other relevant questions include, “Who is/will be on the hook?” “Is this a $50 million problem; a $250 million issue; more?” “Is this going to be advanced as a one-time ask?” “What is the annual cost to sustain these efforts?”

This week’s blog is the first in a two-part series focused on inquiries like these. To answer, we must first explore what goes into calculating the cost to end and prevent homelessness; why coordinated funding alignment is absolutely necessary; and what other communities are expending on similar efforts. Finally, the two-part blog series will address what all of this could mean for Charlotte-Mecklenburg.

WHAT’S INCLUDED IN CALCULATING THE COST?

There are multiple components considered when attempting to calculate the total cost to end and prevent homelessness in any community. In addition to what is currently being spent by the public and private sectors in responding to homelessness, new upfront costs will be incurred for a plan’s initialization. There will then be an annual cost to “work the plan.”

The start-up cost encompasses the budget for all new initiatives, recommendations, programs, and other upfront expenses. It is important to note that not everything new comes at an added expense; for example, some recommendations may focus specifically on process improvements. Other new initiatives may consider sunsetting or combining other, existing efforts.

The annual cost is the additional, recurring expense necessary to sustain all aspects of the plan and the infrastructure needed to support it. The annual cost may vary from one year to the next, as successes and challenges are mapped. The annual budgets may not be for indefinite terms, whether for the entire plan or just a component or two. But any new, annual budgets must be evaluated against and considered in light of all existing annual expenditures devoted to ending and preventing homelessness. This is the only way to get to a closer, system-wide estimate. It will also prove instructive to funders.

Getting to that community total (with a capital “T”) is complicated. Consider just a few of the overall inputs: multiple organizations, each with individual budgets; each of which address a portion (or portions) of the housing continuum, from prevention, to shelter, to affordable housing and cross-sector supports; public sector funding for affordable housing, including the Housing Trust Fund administered by the City of Charlotte and Mecklenburg County’s rental subsidy funding; private sector funding for affordable housing including the Charlotte Housing Opportunity Investment Fund and the Housing Impact Fund; federal and state funding for housing and homelessness; and investments by the faith community. And that is not every input.

There are also multiple “what’s” that have value and should be factored somehow, into both the inputs and the outputs of a community housing and homelessness budget: real estate, including public land; process improvements; policy changes; and time efficiencies. State and federal agencies and organizations, to say nothing of the funding each may provide, are yet another layer that are part of this feedback loop.

Recognizing the complexity of developing a system-focused budget to accompany a system-focused plan, the Charlotte-Mecklenburg Housing & Homelessness Strategy devoted an entire workstream to Funding. More specifically: an effort focused on coordinated funding alignment.

Not surprisingly, a key function of the Funding workstream was to explore how to best calculate the cost to implement the recommendations in the Strategic Framework.

This work also required understanding what all sectors of the community are already spending on housing and homelessness efforts. Knowing the current landscape both informs budget projections and can better focus existing spending. Beyond calculating cost, the funding workstream explored potential requirements for a durable funding strategy to achieve and sustain the recommendations in the Strategic Framework. Their recommendation in the Strategic Framework calls for a funding coalition made up of the public, private, philanthropic, and faith sectors that could, collectively, pool (and coordinate) the resources needed.

WHY COORDINATED FUNDING ALIGNMENT?

The exercise of just calculating the cost to end and prevent homelessness in a community underlines the need for coordinated funding alignment. Think about all the public and private dollars that are funneled to a single strategy, such as providing emergency shelter; or preserving naturally occurring affordable housing; or promoting affordable homeownership; or developing new affordable housing.

Is there duplication of effort? How effective are each of the groups which may overlap? Are the dollars available to a specific segment enough to address that part of the problem? What parts aren’t being addressed? Who is not being served? Which organizations or agencies are in competition for the same, limited resources? Does competition ever lead to system-level collaboration? Most importantly, what are the outcomes for the individuals and families these entities are trying to serve?

A real, coordinated system simply cannot flourish without coordinated inputs, including funding and other resources; nor outputs, including good data. Imagine a community which was centered on comprehensive funding alignment. Funders would collaborate to ensure that all parts of the system (and consequently, all the people who need assistance) are covered. Funders would also ensure that they knew how effective their expenditures are, by measuring progress across the entire system. The data generated would then give everyone a better sense of what the needs actually are, and what gaps need to be filled. This also has the benefit of stretching the overall budget, while ultimately saving money; and serving more households, more quickly.

SO, WHAT

We don’t know, today, what the total cost might be to end and prevent homelessness in Charlotte-Mecklenburg. We cannot quantify the upfront, annual, or other costs, including the cost of creating a coordinated system. We can, however, quantify the people whose basic needs are still unmet by this lack of a systems-level focus.

Answering these budgetary questions is part of the next phase of work; it will be folded into devising the implementation plan. Knowing the answers is important: it puts guardrails around the work. Importantly, it can give the community something concrete to rally around; a goal that, if realized, means that the problem of homelessness problem can be solved.

However, the cost to implement a plan is not the sole math problem in front of Charlotte-Mecklenburg. Thinking about it from another perspective, what is the cost of not doing something? Or, put another way, what is the potential impact, if we do not implement recommendation X, plan Y, or program Z? How much more will that cost our community?

Or, instead of “cost,” what about thinking of funding as an investment? What, then, is the return on our “investment” in ending and preventing homelessness? What are the benefits of this investment? Who benefits? What could it mean for educational outcomes? Economic indicators? Opportunity? Health and wellness?

Viewed from this angle, it’s not enough to just get to the cost. We must understand and be able to articulate the “why” behind it. Knowing the “why” may be the single most invaluable asset in support of our community’s efforts in securing the funding needed, whatever the cost, so that there can be A Home for All.

Stay tuned for next week’s blog, which will share information on what other communities are spending to prevent and end homelessness.