Utah’s ‘housing first’ model is keeping people off the streets. So why are auditors worried?

Legislative report suggests officials should emphasize efforts to promote self-sufficiency.

State funding for Utah’s homeless services system has soared by more than 600% since 2016, and legislative auditors are urging officials to ensure they’re making the most of these investments.

The review released Tuesday notes the state’s emphasis on a “housing first” approach. This strategy relies on getting people into a stable shelter before addressing mental health concerns, substance abuse issues or other needs.

But with an estimated $525 million needed to provide housing for individuals in Salt Lake County alone, auditors suggested that the system’s leaders consider focusing more heavily on addressing “obstacles to self-sufficiency.”

“Providers of homeless services often describe successful outcomes by relating stories of individuals who have overcome serious obstacles to healthy, independent living,” the audit states.

If that’s a priority, the report continues, homeless service system leaders “should develop systemwide and program-level measures to accomplish that objective.”

Auditors acknowledge that the “housing first” model does appear successful in keeping people off the streets. For the last several years, roughly 95% of people placed into permanent housing in Utah stayed there or moved into another housing situation, the report states.

Most of these individuals had landed spots in permanent supportive housing communities, where residents often live in heavily subsidized or free apartments with access to wraparound services.

The problem, according to auditors, is that these communities are costly to build and often become long-term homes for those who stay there.

“Because few residents move on to more independent forms of housing, few new spaces are made available in the existing facilities,” auditors said. “Unless this trend can be reversed through a ‘moving on’ strategy, the growing population of chronically homeless will impose an ever-growing burden on Utah’s homeless services system.”

Based on the expense of building The Magnolia, a 65-unit complex in downtown Salt Lake City, the auditors estimated it would cost $300 million to construct the 1,200 permanent supportive units the state currently needs. It would then cost $52 million per year to keep up with the growing demand for these facilities, according to auditors.

Service providers have said it’s incorrect to assert that permanent supportive housing is pricier than the alternative. That’s a point House Minority Leader Brian King raised in Tuesday afternoon’s audit meeting.

“When you talk about emergency room visits, when you talk about public safety issues, when you talk about the kind of taxpayer dollars that are spent addressing the real needs on a day-to-day basis of the homeless population ... we’re well off investing in greater stock of housing,” King, D-Salt Lake City, said. “Whether it’s supportive or whether it’s affordable housing.”

However, the legislative auditors discouraged lawmakers from banking on these savings.

They also suggested that officials should continuously refresh their strategic plans, do a better job of targeting specific homeless populations such as families or veterans and evaluate the performance of each program. The state also needs a complete understanding of the funding sources that supply the homeless services system and should use a cost-benefit analysis when deciding how to award funds to providers, according to the audit.

They also held up the example of initiatives that center on self-sufficiency, including the Texas-based Haven for Hope, which features a low-barrier shelter and a more intensive “transformation center.”

Still, the audit found, there has been reported progress since 2018, when legislative auditors found that because of the lack of a clear strategy and performance measures, they couldn’t even tell if Utah’s homeless service system was working or not.

In the years since, the state has developed a strategic plan, as have a handful of local homeless councils, the report notes. State lawmakers last year also created a state homeless services coordinator and a council to provide more oversight and better teamwork.

Wayne Niederhauser, the state’s homeless services coordinator, said his office is already working toward several of the audit’s recommendations, such as updating its strategic plan and bolstering its data systems.

The office is committed to supporting its partners in “finding solutions which create the best opportunity to make homelessness rare, brief and nonrecurring,” he wrote in response to the review.