The Heritage Foundation

Backgrounder Update #44

May 4, 1987

May 4, 1987 | Backgrounder Update on

America's Homeless: A Manageable Problem and Solution

(Archived document, may contain errors)

5/4/87 44


J@U a 's Homeless," May 8gd ting Backgrounder No. 431, "A Strategy for Helping America 6,


Congress seems to believe that the woes of the homeless in the United States can be solved with cash and rhetoric. Measures being considered on Cagitol Hill would provide as much as $725 million in homeless aid. Ile trouble is, all this cas and talk are likely to be not only irrelevant and wasteful, but also detrimental to the welfare of the homeless themselves.

America's homeless problem is manageable. Recent studies of a number of cities reinforce the. 1984 estimate of the U.S. Department of Housing and Urbp Development that, on any given night, approximately 300,000 Americans are homeless. Currently there are shelters and emergency beds available to house about half this number. Already, however, private agencies, states, and localities have been providing extra resources at a rapid rate to meet specific, local needs. It is pe that the remaining problem of homelessness can be met with a modest expansion of existing efforts, combined with specialized assistance to the mentally ill, who account for up to half the homeless population. Needless Panic. Congress is being needlessly panicked into acting without thinking. Lawmakers are ignoring the mounting evidence concerning the actual size and nature of the homeless problem .al posturing by local politicians and sensational news reports have combined to crwite : regmiclat@ive momentum for new but largely irrelevant federal programs, based on the myth that there is a growing population of over two million

1. A Report to the Secretaa on the Homeless and EmerLenGy Shelters U.S. Department of Housing and Urban Development, 1984.

homeless Americans who are overwhelming local agencies. Only massive infusions of federal cash, sy advocates, can deal with the problem. The truth is that there is no basis for the two million figure. To make matters worse, such reckless projections discourage those local actions that are actually making significant progress. Homelessness is a problem whose best solution draws on the strength of decentralized federalism. It is not an issue that demands centralized fundi d ontrol. Studies indicate that the characteristics of the homeless population di r significantly from city to city. In no American city does the number of homeless appear to exceed the resources of state, local, and private agencies--especially once the unique problems of the mentally ill are addressed. What is required is not more t9p-down money, but clear local resolve and the energetic use of existing resources in the affected areas. The Reagan Administration and Congress can serve the homeless most effectively in three ways: 1) Modifying existing law and regulations to make sure that the mentally ill are not deinstitutionalized and put out on to the street without adequate local care already in place. 2) Continuing .to eliminate restrictions on housing and community programs that prevent'cities from serving the homeless under existing programs and make it difficult for state and local agencies to coordinate services. 3) Preventing the use of federal funds to tear down single occupancy hotels and other housing f6r low-income Americans. The legislation recently passed by the House and Senate does none of these things. As such, it should not be signed by Ronald Reagan.

THE NUMBERS GAME In the three ears since the publication of a 1984 HLAD report estimating the homeless population at 90"1000 to 350,000, the study remains the only scientific and comprehensive attempt at a national estimate of homelessness. A number of localized but more intensive studies not only have confirmed HUD's description of the homeless population, but also have supported the accuracy of HUD's estimate of the size of the homeless population. In fact, studies of New York, Chicago, and Los Angeles, the three cities generally acknowledged to -have the largest homeless populations, lead to the conclusion that, if anything, HUD may have overstated the number of homeless significantly. Examples: New YorL A September 1986 study undertaken for the National Bureau'of Economic Research (NBER), a highly respected data analysis group, concludel that HUD's national numbers and numbers for New-York City were reasonably accurate. The study did somewhat disagree regarding the characteristics of the homeless, finding much more long-term homelessness in the city, but otherwise the analysis did not fault the HUD study. NBER interviews with the homeless indicate not only the usual information about the grevalence of mental illness and substance abuse, but also the presence of criminal ackgrounds as a strong causal element--a factor rarely noted. The description of the the

2. Richard B. Freeman and Brian Hall, Permanent Homelessness in America?, National Bureau of Economic Research, September 1986, pp. 5-6.


New York homeless makes clear that the characteristics and relative size of the homeless population differ markedly from city to city.. Chicago. A study by the University of Chicago and the University of Massachusetts-Amhurst indicates a nightly Chicago homeless population of fewer than 3,000 persons. 3 Ile HUD estimate three years earlier had been approximately 20,000. The Chicago study !as based on intensive street survey work and shelter interviews, and concludes that Ithe smaller numbers] are th@ on!y estimates based on aqtual counts of. homeless persons, conducted according to scientific sampling practices.'" Los Angeles. Los Angeles has been su ect to a number of studies since 1983. A 1984 - - Vental Health in the most concentrated area of honi6l@ss ness-, -Skid Aow, cor@irnie d- only 7,000 homeless; the HUD study had put the citywide number at 31,000 to 33,000, which would have required 15,000 to 20,000 homeless in Skid Row. The most recent Los Angeles analysis of the Skid Row area, usm& an intense, scientific. methodology simile f to that of the Chicago study, arrived at a single night estimate of fewer than 2,500.

False Assumption. Both HUD's study and the New York study assumed that the number of homeless outside shelters was approximately double the number inside. But actual counts in Chicago, Los Angeles, Denver, Washington, and Nashville all find less than one person outside a shelter for each inside. This change in the comparative figures is in large part a result of strenuous efforts by city officials and shelter mana$ers to find homeless Americans and bring them in -off the streets. In many cases, the homeless are very reluctant to sta in shelters. Where the city studies can be compared to the HUD y estimates, this and other factors resulted in figures less than one-third of the HUD estimates.

No serious city study of homelessness,.except for the New York study, has come up with a figure anywhere near as high as HUD's. And HUD's numbers are much lower than the shocking "estimates" routinely cited in the press, on television, and at congressional hearings. Counterproductive Data-Inflation. Le islation being pushed through Congress may well overwhelm and inhibit effective localrv based effo'rts to solve the many local problems causing the nation's homelessness. Only withe problem is presented in honest and realistic terms such that it appears manageable, warns Martha Hicks, who heads the Skid Row Development Co oration in, Los, @ngeles, "[will] people want to help because they feel they can really = a difference.'


Local governments and private agencies during the past few years have increased significantly their efforts to deal with homelessness. The 1984 HUD report found a 41

3. Peter H. Rossi, Gene A. Fisher, and Georgiana Willi% The Condition of the Homeless of Chicagp, Social and Demographic Research Institute and NORC@ A Social Science Research Center, Amherst, Massachusetts, and Chicago, Illinois, September 1986, pp. ix, 57.

4. Ibid.

5. Hamilton, Rabinovitz and Alschuler, Inc., A-Social Services and Shelter Resource Inventojy of the Los Angeles Skid Row Area Community Redevelopment Agency of the City of Los Angeles, California, 1986, p. 23.

6. Quoted in Jay Matthews, "Homeless Shelter Officials Differ on Problem's Scope, Nature," The Washington Post February A 1987. -3-

percent increase in the number of shelters in just the four years prior to the report. The study also found that 94 percent of shelters were operated by charitable and other private organizations. Between 1980 and 1986, for instance, the number of shelters in Massachusetts jumped from merely two to 29. Denver maintains 1,000 shelter beds and supplemental rooms in boardinghouses and hotels to handle a homeless population, which a recent study counted as 1,200 to 1,500 persons. And since 1980, Los Angeles has opened new shelters providing 1,200 beds to supplement 1,000 beds in mission shelters in the Skid Row area alone.

Understating Amount Spent. Governments at all levels have stepped up efforts to tackle the problem. Example: HUD records indicate that cities have used over $112 million of federal Community Development Block Grant (CDBG) funds for homelessness since 1983. This probably understates the actual amount spent, since the reporting is voluntary and not part of usual record requirements. Among a number of state initiatives, Illinois responded to the Chicago study by raising its appropriations for the homeless. At the federal level, meanwhile, as early as 1983, HUD, the Department of Defense, and the General Services Administration acted to provide underutilized federally owned buildings to cities and charitable organizations for temporary use as homeless shelters. These federal agencies continue to work with communities to keep facilities available. HUD set up simplified procedures for public housing agencies, making it easier for them to make emergency housing available for -homeless families. And since 1983, the Federal Emergency Food and Shelter program has disbursed $210 million for homeless assistance throu the states and a national board of charitable organizations. The limited and 1 geneia' , I nature of the federal measures properly has kept the focus on local initiative and the unique nature of each homeless problem.

THE FLAWS OF NEW LEGISLATION The pending federal homeless legislation, passed by the House (H.R. 558), requires the e federal government to step into th limelight, at a staggering cost of $725 million. On the basis of the recent study figures, this amounts to about $6,000 for every currently unsheltered homeless person. The legislation scatters money widely among new and existing programs. Among these: the Emergency Food and Shelter program, Section 8 low-income housing, the Community Services Administration, and federal job-training rograms al receive more funding. And the legislation would create newgrant programs or a system of federal shelters and for federally managed health services for the homeless. ongress also would create an Interagency Commission to issue reports on all the federal omeless activities.

Despite the new funding and programs, the legislation does not identify the specific problems it is attempting to cure, nor is there any coherent long-term plan to meet the needs of the homeless. Money is simply to be thrown at symptoms. Those communities that have been doing an excellent job on their own, using existing resources, would be confronted with a new series of federal funding rules. The communities would be forced to reorganize their local efforts to fit the new federal efforts, thereby paralyzing many successful programs undertaken by state and local agencies and by the private sector. Compared with the House bill, the Senate legislation (S. 809) is only slightly more

7. Suzanne Weiss, "Study Cuts Size of Denver Homeless," Rocky Mountain News February 5, 1987.

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reasonable, and subject to the same concerns about the lack of a clear strategy. If the legislation is enacted, federal intrusion threatens to overwhelin effective local efforts to deal with an identified and manageable problem.


Homelessness is a problem for which the American multilayered federal system is well suited. Homelessness is not rampant and overwhelming. With the possible exception of New York City, it is manageable using the resources of state, local, and i rate agencies, ,pm together with existin$ federally funded programs for which there is local discretion. Ile New York problem is clearly linked to the city's destruction of its own housing suppl through rent and development controls and exacerbated by City Hall's policy of holYingon to tens of thousands of unrehabilitated vacant apartments. Depending on the makeup of the homeless population, the best response in other cities includes land use policies that encourage single room occupancy hotels, rather than tearing them down, and provides emergency housing vouchers for families. Mentally Ill. Tle gravest dilemma for policyniakers is how to resolve the question of the homeless mentally ill. Here it first is a matter of decidin . h ther the civil rights of the mentally ill and chronic drug abusers include sleeping *in pu spaces, or should these troubled and sometimes desperate Americans be forced into elters and institutions. The reason for the highproportion of mentally ill among the homeless is not so much the result of recent d institutionalization--since that occurred mainly in the 1960s and 1970s--but of a generally accepted policy of noninstitutionalization. Congress and cities need to address these difficult questions concerning individual rights and the need to treat mentally ill Americans in proper medical facilities. With existing federal resources, the great majority of cities can meet the needs of homeless families and capable individuals. Even in 1984, with approximately I 11,000 beds available nationwide, together with emergency vouchers and hofel facilities, the U.S. was within range of meeting the needs of the segment of the homeless population that is not mentally ill. It may prove to be the case, however, that there will eventually be a resistant homeless population of 100,000 to 150,000 Americans who cannot be served without redefining theiF riight@. This will require sensitive and carefully considered policies regardmg special facilities for the mentally ill. Simply allowing these troubled Americans to wander the streets while the federal government showers cities with money does not address the difficult underlying problem. Private Agencies. If federal, state, and local governments are to work with the private sector in serving the homeless whose needs can be addressed by normal means, they need to continue their current efforts based on local initiatives. Private agencies, charitable. organizations, and churches should continue to play the primary role in providi F& services, supplemented by governments. This is a problem of a size and character precisely suited to be handled within the federal system, using existing resources. A federal takeover of the homelessness problem, with gushing federal dollars and regulations, replacing creative local efforts, may enable some members of Congress to appear compassionate, and it will assure a direct money pipeline for the media star homeless advocates. But it Will do little to help the creative local groups on the frontline of the issue--or the homeless themselves. I

Prepared for Tle Heritage Foundation by Kenneth J. Beirne a Washington-based policy researcher

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