Los Angeles Galperin Blasts Waste & Mismanagement of Homeless Funds

Los Angeles City Controller Ron Galperin released "The Problems and Progress of Prop. HHH," his third review of the City of Los Angeles' performance of the voter-approved $1.2 billion bond program aimed at reducing homelessness by creating up to 10,000 units of housing, along with interim shelters and storage facilities. Since HHH passed more than five years ago, homelessness has jumped by at least 45% in Los Angeles and thousands of people have died on the streets, including an average of five per day in the pandemic's early months.

Galperin investigated HHH in 2019 and 2020 and recommended reallocating funds to lower-cost projects, cutting red tape and increasing investment in timely interim housing solutions. In his current report, Galperin found that costs continue to rise, delays continue to mount and HHH is still unable to meet the demands of the homelessness crisis. He called on City leaders to implement his recommendations to improve HHH and inform any homeless housing programs adopted or approved by voters in the future.

"Although Los Angeles has made some progress with Proposition HHH, it hasn't been enough," said Controller Galperin. "The costs are too high, and the pace is too slow to address the tragedy on our streets. My recommendations to improve HHH will make a difference now and should guide future homeless housing programs. If the City doesn't learn from its mistakes, it risks repeating them. Angelenos, sheltered and unsheltered, cannot afford that to happen."

Problems overshadow progress

HHH projects are taking between three and six years to complete. At the current pace, 54% of all units will not open for another two to four years. Even when every HHH unit is built, tens of thousands of Angelenos will still lack housing. Here's a snapshot of HHH:

8,091 total HHH housing units will be produced across 125 projects.

1,142 units (14%) are ready for occupancy today.

4,347 units (54%) are in construction.

2,602 units (32%) are in pre-development - not yet in construction.

HHH costs have reached staggering heights. For projects in construction, the average per-unit cost jumped to almost $600,000 in 2021 - up from $530,000 in 2020.

14% of units in construction cost more than $700,000 per unit.

One project in pre-development is estimated to cost $837,000 per unit, $100,000 per-unit more than the most expensive project in 2020.

If nothing changes, Galperin believes costs could soon reach $900,000 or $1 million per unit.

Changes needed

The city has started implementing two of four major changes recommended by Galperin in previous reports, but more urgency is needed going forward.

Changes in progress: (1) Galperin's recommendation to speed up the City review processes for HHH-funded projects; and (2) his recommendation to acquire and convert existing buildings for housing.

Changes not implemented: (1) Galperin's recommendation to build interim housing and facilities using HHH funds; and (2) his recommendation to evaluate the City's ability to change course on expensive or stalled projects before finalizing HHH loans.

Mapping HHH projects and costs

Along with the report, Galperin created a series of interactive maps showing the cost and status of the City's 125 HHH projects. Users can click on a pin to view information about each project, including the developer's name, project costs, current status and more.

Explore the HHH report and story map at lacontroller.org/problems-and-progress-of-prop-hhh.

The full report can be found here: https://lacontroller.org/audits-and-reports/problems-and-progress-of-prop-hhh/