The Realignment of HUD Continuum of Care Program Homeless Assistance Funding: What Are the Outcomes?

Joe Colletti, PhD
Hub for Urban Initiatives
July 2017

Since 2012, there has been a significant realignment in funding from the U.S. Department of Housing and Urban Development (HUD) for the Continuum of Care (CoC) Homeless Assistance Program. Most notable is the shift of funding from transitional housing and supportive services only projects to permanent supportive housing and rapid rehousing projects (click on the following link for definitions: https://www.hudexchange.info/programs/coc/coc-program-eligibility-requirements).  

Local and federal assessments are needed to determine the outcomes of the realignment of Continuum of Care Program funding. Analyses at the national and jurisdictional level would help determine the impact of increased funding for permanent supportive housing and rapid rehousing to help end homelessness for the intended subpopulations, which included chronically homeless persons, families, and youth.

As described below, there is some evidence that the realignment of funding may have contributed to national decreases in homelessness among intended subpopulations of homeless persons. However, it appears the decreases have been modest to moderate to date.

An assessment at the jurisdictional level may prove otherwise. If a jurisdiction were to take a close look at any of its own realignment of CoC Program funding since 2012, and look closely at its homeless count data as it is done towards the end of this brief, the CoC may have had modest, moderate, or major decreases among the intended subpopulations of homeless persons—or not. 

            The Realignment 

As noted in the table below, funding for

• transitional housing decreased from $412,457,781 in 2012 to $108,067,486 in 2016, which represents a decrease of $304,390,295 or 73.8%; and
• supportive services only projects decreased from $128,602,609 in 2012 to $47,066,603, which represents a decrease of $81,536,006 or 63.4%. 

Conversely, as noted in the table below, during the same time funding for

• permanent supportive housing increased from $1,027,500,308 in 2012 to $1,434,271,450 in 2016, which represents an increase $406,771,142 or 39.6%; and
• rapid rehousing projects increased from $13,232,856 in 2012 to $249,743,224, which represents an increase of $236,510,368 or nearly 1787%. 

Together, funding for permanent supportive housing and rapid rehousing increased from $1,040,733,164 in 2012 to $1,684,014,674 in 2016, which represents an increase of $643,281,510 or 61.8%.

Together, funding for transitional housing and supportive services only projects decreased from $544,155,758 in 2012 to $155,134,089 in 2016, which represents a decrease of $389,021,669 or 71.5%.  

Table 1. Total Funds Awarded for Selected CoC Components for 2012 – 2016.

As we await the release of the U.S. Department of Housing and Urban Development (HUD) 2017 Continuum of Care Homeless Assistance Program competition, (CoCs), realignment of HUD Continuum of Care Homeless Assistance Program funding will likely continue for the 400+ Continuums of Care (CoCs). HUD is continuing the separate but related activities that have shaped the realignment. They are the permanent housing bonus, reallocation, and tiering. 

            Permanent Housing Bonus 

As noted in the 2017 Registration Notice for the Continuum of Care Program competition,  

“Depending on the amount of funding made available in the FY 2017 Appropriation, HUD may continue the Permanent Housing Bonus. CoCs may create new projects through the permanent housing bonus based on a percentage of the CoC’s FPRN for the following types of new projects for those CoCs that meet the criteria in the FY 2017 CoC Program Competition NOFA:

•  permanent supportive housing projects that will primarily serve chronically homeless individuals and families, including unaccompanied youth;
• rapid rehousing projects for homeless individuals and families, including unaccompanied youth, coming directly from the streets or emergency shelters, or persons fleeing domestic violence situations and other persons meeting the criteria of paragraph (4) of the definition of homelessness;
• joint Transitional Housing (TH) and Permanent Housing-Rapid Rehousing (PH-RRH) component projects, that will combine TH and PH-RRH into a single project to serve individuals and families experiencing homelessness.” 

The last type of project, a joint TH and PH-RRH, is new this year and little information has been provided within the 2017 Registration Notice other than such projects must provide low-barrier temporary housing to quickly move homeless persons into permanent housing. The Notice also stated that “Additional information will be provided in the FY 2017 CoC Program Competition NOFA,” which has not yet been released. 

            Reallocation 

 As noted in the 2017 Registration Notice for the Continuum of Care Program competition, reallocation is described as 

“When a CoC shifts funds in whole or part from existing eligible renewal projects to create one or more new projects without decreasing the CoC’s ARD [Annual Renew Demand]. All CoCs may use the reallocation process. In the FY 2017 CoC Program Competition, HUD anticipates allowing CoCs to use the reallocation process, at a minimum, the following new projects:

1.  permanent supportive housing projects that will primarily serve chronically homeless individuals and families, including unaccompanied youth;
2. rapid rehousing projects for homeless individuals and families, including unaccompanied youth, coming directly from the streets or emergency shelters, or persons fleeing domestic violence situations and other persons meeting the criteria of paragraph (4) of the definition of homelessness;
3. Joint Transitional Housing (TH) and Permanent Housing-Rapid Rehousing (PH-RRH) component projects, that will combine TH and PH-RRH into a single project to serve individuals and families experiencing homelessness;
4. dedicated HMIS projects; or
5. Supportive Services Only (SSO) project specifically for a centralized or coordinated assessment system.” 

Tiering 

Also, as noted in the 2017 Registration Notice for the Continuum of Care Program competition, HUD will continue the Tier 1 and Tier 2 funding process in the FY 2017 CoC Program Competition to promote a more competitive process among CoCs. 

CoCs must rank all projects submitted to HUD for funding in either Tier 1 or 2. As noted in last year’s Notice of Funding Availability (NOFA), 

“Tier 1 is equal to 93 percent of the CoC’s FY 2016 Annual Renewal Demand (ARD) approved by HUD on the final HUD-approved Grant Inventory Worksheet (GIW). Tier 2 is the difference between Tier 1 and the CoC’s ARD plus any amount available for the permanent housing bonus.” 

If Tier 1 is equal to 93% of the CoC’s FY 2017 Annual Renewal Demand (ARD) approved by HUD for the 2017 Continuum of Care Program competition, then, for example, a CoC with an ARD of $5,000,000 will place $350,000 in Tier 2. 

Since tiering began in 2012, most CoCs, if not all, initially placed low performing renewal projects, transitional housing, and supportive services only projects in Tier 2. CoCs were given the choice of reallocation as described above. A CoC could reallocate the funds for a transitional housing project or a supportive services only project to a permanent supportive housing project or a rapid rehousing project, which is a primary reason for the realignment of CoC Program funds. 

            Next Steps 

A formal evaluation is needed to assess and determine the outcomes of the realignment of Continuum of Care Program funding. The examination should ascertain the impact of the increased funding for permanent supportive housing and rapid rehousing upon the goals of ending homelessness for the intended subpopulations previously mentioned. 

As noted below, there is some evidence that the realignment of funding may have contributed to national decreases in homelessness among intended subpopulations of homeless persons. However, the decreases have been modest to moderate to date. 

It is important to note that an analysis at the CoC level may prove otherwise. If a CoC were to take a close look at any realignment of funding since 2012, and look closely at its homeless count data as was done in the table below, the CoC may have had modest, moderate, or major decreases among the intended subpopulations of homeless persons—or perhaps increases. 

Since 2012, HUD has encouraged permanent housing bonus and reallocated funds to be used for permanent supportive housing for chronically homeless individuals and families to support CoC efforts to end chronic homelessness. The next table is based upon the annual homeless count reports that CoCs are required to submit to HUD (https://www.hudexchange.info/programs/ coc/coc-homeless-populations-and-subpopulations-reports). In 2012, CoCs reported 96,268 chronically homeless persons and 86,132 in 2016, which represents a decrease of 10,136 persons or 11.8%.

The table also lists the number of persons who were severely mentally ill and had a chronic substance abuse problem. Often, chronically homeless persons have severe mental illness and/or chronic substance abuse problems. In 2012, CoCs reported 108,378 persons who were severely mentally ill and 107,801 in 2016, which represents a decrease of 577 persons or 0.5%. However, in contrast to this slight decrease, CoCs reported 127,477 persons who had a chronic substance abuse problem in 2012 and 94,496 in 2016, which represents a decrease of 32,981 persons or 25.9%. 

Table 2a: Comparison of Total Number of Selected Homeless Subpopulations: 2012 – 2016

Table 2b is also based upon the annual homeless count reports that CoCs are required to submit to HUD (https://www.hudexchange.info/programs/coc/coc-homeless-populations-and-subpopulations-reports). 

Since 2012, HUD has also encouraged permanent housing bonus and reallocated funds to be used for rapid rehousing for individuals and families, especially to support CoC efforts to end family and youth homelessness. Rapid rehousing provides temporary rental and other types of assistance and is generally for non-chronically homeless persons, including families and youth. Longer rental and other types of assistance are needed for chronically homeless persons because of their long-term and/or permanent disabilities. Such assistance is often permanent supportive housing. 

As noted in the next table, CoCs reported

• 525,285 non-chronically homeless persons in 2012 and 463,796 in 2016, which represents a decrease of 61,489 persons or 11.7%;
• 239,397 persons in households with at least one adult and one child under age 18 in 2012 and 194,716 in 2016, which represents a decrease of 44,681 families or 18.7%;
• 39,419 persons in households age 18 – 24 without children in 2013 and 33,851 in 2016, which represents a decrease of 5,568 persons or 14.1%. 

Table 2b: Comparison of Total Number of Selected Homeless Subpopulations: 2012 – 2016:

*Data was not recorded in https://www.hudexchange.info/programs/coc/coc-homeless-populations-and-subpopulations-reports.