Up To $837,000: Los Angeles Plans to Disburse On One Housing Unit


California voters approved a $1.2Billion program to provide housing for the homeless in 2016. Californians deserve to be commended for their generosity and compassion.

Six years later, 1,200 of the 10,300 units that were paid for have not been built. According to Ron Galperin, Los Angeles’ city controller, one housing unit would cost $837,000.

Another 14% units cost more than $700,000. Galperin stated in a letter that was attached to the 31-page report that the program is not able to address the needs of the homeless crisis. While the pace of development is slow and the cost of each unit keeps rising, in some cases to alarming heights, it continues to be expensive. Eric Garcetti, the Los Angeles Mayor, believes that the program is doing a great job. Associated Press: John Maceri is chief executive at People Concern, which is one of L.A.’s largest non-profits that serves the homeless. He agrees with the general finding that housing needs to be built faster and more affordable. He warned that the program, although a positive step, does not provide enough money to finish projects.

He suggested that innovative financing is the solution. This will reduce red tape and speed up construction. Maceri stated that housing has not kept up with the urgent need to address the crisis of unsheltered homelessness. Ah, yes. Red tape is everywhere. The red tape.

The audit in LA found that the HHH project included 8,091 housing units. Most of these units are connected to services for substance abuse treatment and mental health. It is spread across 125 projects. Around 4,200 units are currently under construction. Additional 2,369 units are being built using funds from other sources than the HHH program. Audit results indicated that a new approach and billions of dollars in future spending would be required. The audit found that while future plans are not yet finalized, it is likely that building additional units with the same model will cost billions of money and take too much time to meet the urgent need of the homeless. The audit urged the city’s leadership to look for ways to increase scale faster and more economically.

Galperin must have had a lot of fun writing that. Galperin wants the city’s ability to scale up quickly and more affordably.

Gee…ya think?

This situation is so tragic because politicians, from Newsom to Garcetti and the kind-hearted do-gooders such as John Maceri, don’t know what went wrong. They don’t see how competition and market forces can be used to lower housing costs. They don’t realize that wasting millions of man-hours on paperwork can increase costs and take time.

They should be aware of these facts and that they aren’t criminally wasteful or liable for the deaths of thousands of homeless persons.