For decades, housing providers and researchers have shown that providing permanent supportive housing — which couples affordable housing programs with substance use and mental health treatment — is a successful model for helping people experiencing chronic homelessness find stability.
The challenge has been soliciting the funding and political will to put it into practice. Denver launched a five-year program in 2016 to study how to creatively fund permanent supportive housing programs as an approach to tackling homelessness. The results of the study are expected this summer, but the state isn’t waiting to start funding new projects.
The Colorado Department of Local Affairs announced on Friday that Redi Corporation, a nonprofit affordable housing organization based in Denver, has been awarded $1.3 million by the State Housing Board to construct a new housing project that will be tailored to the needs of people experiencing chronic homelessness in the Denver metro area.
Rhonda’s Place, to be located in Denver’s Barnum neighborhood along South Federal Boulevard, will include 49 units of permanent supportive housing. The Mental Health Center of Denver, who participated in the five-year pilot program, will provide services to residents such as independent living skills training, employment and benefits assistance, and mental health and substance abuse treatment.
The housing project will consist of one-bedroom units for people with a maximum income of 30% of the area median income, which is approximately $21,000 per year. Redi Corp., which manages nine affordable housing properties in the Denver metro area, plans on beginning construction in July to have the project complete by August 2022. The facility will be designed by trauma-informed architecture firm Shopworks, which helped design the community spaces for Denver’s first tiny home community for people experiencing homelessness.
“Every step along the way it’s been exciting,” said David Murphy, executive director of REDI Corp. “Just finding real estate land available to build on that has the proper zoning for this facility is hard to find in Denver, so we’re very excited about that.”
Five-year pilot program
Cathy Alderman, vice president of public policy and communications for the Colorado Coalition for the Homeless, said that at the core of the supportive housing model is the “housing first” philosophy, which essentially means that the first priority is getting a person into housing before trying to address the issues that led to their instability.
“So you don’t create barriers for people to get into housing like sobriety or employment or family unification,” Alderman said. “You try to figure all of that stuff out after somebody is safely housed, and the supportive part of the housing is really providing wraparound services so that people can stay housed and address those issues.”
But the key to the “housing first” approach is ensuring that there is enough affordable housing available in the first place — a growing crisis in the Denver metro area and across Colorado, especially for the state’s lowest income households.
To try to tackle the issue, the city of Denver embarked on a social experiment in 2016 to see if it could disrupt the cycle of people experiencing chronic homelessness from ending up in jail by providing permanent supportive housing that included substance abuse and mental health treatment programs. Though the approach is not unique, the proposed funding model is.
The city got eight private investors to agree to pay $8.6 million in upfront costs to house 250 people who had frequent interactions with the city’s jail system. The investors only get paid back if the program proves successful — an approach referred to as a social impact bond initiative.
The Urban Institute, a social and economic policy research organization based in Washington D.C., will release a final report evaluating the program this summer, looking specifically at housing stability rates, health outcomes and if the initiatives decreased individuals’ interactions with the criminal justice system.
“So far, the program has been really successful,” said Mary Cunningham, vice president of the Metropolitan Housing and Communities Policy Center at the Urban Institute, who is spearheading the research.
“People see these folks on the street, and they think, ‘Oh, that person chooses to live outside’ or they say, ‘This is an unsolvable problem, they can’t really be housed.’ And what supportive housing shows is that that is in fact a myth and that it is a solvable problem and that people with the right support can get housed.”
Cunningham said the next step for the city is to determine how to scale — and fund — a citywide program. “So that it’s not just a few hundred lucky folks who get it, but that there’s enough supportive housing for all the people who need it.”
4,000 unsheltered individuals in the Denver area
Alderman said that although not every person who is experiencing homelessness needs supportive housing, many do.
“For some people, it’s just vocational services, so connecting somebody with employment,” she said. “And then, for others, it’s a much higher level of services because they are interested in addressing their substance use disorder or they’re suffering from mental health issues.”
CCH owns and operates around 2,000 units of affordable and supportive housing, mostly in the Denver metro area. Its Renaissance Downtown Lofts in Denver offer 101 supportive housing units. The organization participated in the five-year pilot with the city, alongside the Mental Health Center of Denver.
“The goal of that project was to demonstrate that if you house these individuals, even if you’re providing a high level of services, it’s going to cost you less than leaving them outside to constantly cycle through emergency systems such as detox, jail and hospitals,” Alderman said.
Alderman said they’ve seen between a 83% and 87% success rate in housing stability for the people who participated in the five-year program. She hopes Denver and the state invest more in providing permanent supportive housing to help address the city’s growing housing crisis.
“We’re talking these days about there being at least 4,000 unsheltered individuals in the Denver area,” Alderman said. “And not every single one of them would need the highest level of service to come with their housing, and frankly a lot of them might not need any at all.”
“But, a lot of times, it’s not enough just to give somebody a rental subsidy and wish them luck,” she added. “Rental vouchers should all come with some level of services funding, even if it tapers off at some point in time.”
Model has shown success, but funding hasn’t followed
Cunningham said that the permanent supportive housing model has proved successful since the 1990s when Sam Tsemberis, a clinical psychologist, was working directly with people experiencing homelessness in New York City.
“He basically was going out every day and trying to get people into rehab or detox or shelter,” Cunningham said. “He was asking people to kind of meet a bunch of preconditions or requirements in order to get housing, and he could see pretty clearly that that wasn’t working. So he kind of turned it upside down and said, ‘We are going to give you housing first.’”
A study done by Dennis Culhane, a professor at the University of Pennsylvania, showed how expensive it was for cities to keep cycling people experiencing homelessness in and out of jail and emergency rooms. Cunningham said at the time, those findings appeared to resonate with the George W. Bush administration.
“They started to invest in supportive housing and the numbers of people who experienced chronic homelessness started to go down,” Cunningham said. “They made a pretty significant dent continuing into the Obama administration. Then, the funding and enthusiasm for that model decreased and the numbers became stagnated.”
Cunningham said while the model has proven successful across the country, it’s been challenging to solicit adequate funding for the strategy.
“People don’t recognize that it costs a lot of money to do nothing about homelessness,” she said. “It costs a lot of money in terms of policing, jail stays, (homeless) shelters.”
“There is a lot of political resistance to funding housing, and in part I think because people think of housing as a reward in this country, something that you earn,” she added. “They don’t really understand that a lot of people are locked out of the private housing market, or that the housing market does not produce enough units for people at the lowest income. There’s that disconnect.”
She’s feeling slightly more optimistic lately.
“The Biden administration just made a bunch of investments at homelessness, both in terms of the relief packages, and then proposed in the president’s budget,” Cunningham said.
“Congress had made a bunch of investments, and then it just seemed to stagnate and the numbers stopped going down and there wasn’t as much of an investment,” she added. “I think that’s changing a little bit with this new administration.”