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Committee asks for $7.3 million in bond funds for supportive housing

Thursday, May 31, 2012 by Michael Kanin

A plan by the City of Austin to build permanent supportive housing units in Austin will cost $21.57 million, or about $86,000 each.


That’s according to Ed McHorse, chair of the City of Austin’s Leadership Committee on Permanent Supportive Housing, who last week asked council members to include $7.3 million of that figure in the city’s 2012 general obligation bond package.


McHorse made the request as part of a presentation about financing for such housing. A push for more affordable residences for extremely low-income and indigent residents who require social services – known as permanent supportive housing – resulted in the 2010 resolution that directed the city to work with various other community stakeholders to add 350 more units. According to the council resolution, 250 of the 350 units would be new or rehabilitated; the other 100 units are expected to be leased. McHorse’s committee was assembled to investigate financing possibilities for that effort.


Other costs include $3 million in annual rent subsidy fees and $4.13 million for the services that define the practice of permanent supportive housing.


Despite the costs, Mayor Pro Tem Sheryl Cole pointed out that it could be far more expensive to deal with homelessness and its related issues if they were left unchecked. “When we look at the city as a whole – not just our savings, but the emergency medical services that are provided and mental health services that are provided – I know I’ve seen a number in the past that was in excess of millions,” Cole said.


McHorse and his colleagues found roughly $7.2 in potential state dollars that could go toward the expenses. To that, they added more than $3 million in existing City of Austin funds, more than $600,000 from Travis County and $2.2 million in new federal grants. They also expect to raise over $500,000 in philanthropic donations.


That leaves a $7.3 million gap for capital investments, an amount McHorse suggested was something of a minimum. “I want to just emphasize here, briefly, that that doesn’t mean $7.3 million is enough,” McHorse said.


Permanent supportive housing is fueled by a host of social services offered to property residents that are aimed to help keep them off city streets. “This is the part that makes permanent supportive housing successful,” McHorse said. “It says, ‘we’re not just going to put you in housing and hope you do well, we’re going to provide you with services to become self-sustained.’ ”


McHorse budgeted more than half of the $4.13 million needed for these services for new federal Medicaid waivers. Other funds would come from the U.S. Department of Veterans Affairs, Travis County and donations. The City of Austin would be responsible for $500,000 of the housing services budget.


The leadership committee’s plan also calls for the city to provide 124 units from the Housing Authority of the City of Austin. Council Member Chris Riley asked McHorse if the authority’s standards served as a barrier for potential supportive housing residents.


“In general, the population we’re talking about would have trouble getting through on account of the standard (the Housing Authority)…requirements,” McHorse replied. “We’re talking with them about ways in which we can address those in a way that maintains everything else they do really well, but find ways to make sure we meet this subpopulation.”

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