“Fishermen know the sea is dangerous and the storm terrible,
but they have never found these dangers sufficient reason to remain ashore.”
Vincent Van Gough
An independent study by Sierra Health Foundation fully substantiated the argument Cottage Housing used to avert Governor Schwarzenegger’s budget cuts. In fact, supportive housing projects don’t cost tax-payers’ money - we save it.
This 2013 study by Sonja Lenz-Rashid, PhD, LCSW concludes that our supportive housing project: (1) lowered the number of children in families who need intensive crisis intervention; (2) reduced the duration of this support; and (3) lessened the cost of this care.
Supportive Housing for Homeless Families: Foster Care Outcomes and Best Practices assessed nearly 300 children in 150 families living at one of Cottage Housing’s project sites. Most of these children were reuniting with their families after foster care or other placements in Sacramento County’s Child Protective Services (CPS) system.
Compared to comparable children in the CPS system, the children at Serna Village showed:
These findings are particularly significant given that children in foster care are twice as likely as military veterans to exhibit PTSD symptoms.
Other facts correlating homelessness and foster care placement.
These facts have inter-generational implications, since three-quarters of homeless parents with a foster care history have at least one child involved in the Child Protective Services (CPS) system. The increasing likelihood of perpetuating the cycle of dependency is indicated by research showing half of all women and a quarter of men becoming parents within 18 months after leaving the foster care system.
A study by the Corporation for Supportive Housing describes core elements of a supportive housing intervention strategy that effectively addresses the unique challenges of these special need populations:
“DIMENSION #1: Administration, Management, and Coordination:
All involved organizations follow standard administrative/management practices, and coordinate their activities in order to ensure the best outcomes for tenants.
DIMENSION #2: Physical Environment:
The design, construction, appearance, physical integrity, and maintenance of the housing units provide an environment that is attractive, sustainable, functional, appropriate for the surrounding community, and conducive to tenants’ stability.
DIMENSION #3: Access to Housing and Services:
Initial and continued access to the housing opportunities and supportive services is not restricted by unnecessary criteria, rules, services requirements, or other barriers.
DIMENSION #4: Supportive Services Design and Delivery:
These services facilitate access to an array of resources; are tenant-focused; effectively address tenants’ needs; and foster housing stability and independence.
DIMENSION #5: Property Management and Asset Management:
Property management activities support mission/goals of the housing program (while) sustaining the physical and financial viability of the housing.
DIMENSION #6: Tenant Rights, Input, and Leadership:
Tenant rights are protected within consistently-enforced policies and procedures; tenants are provided with meaningful input and leadership opportunities; and staff - tenant relationships are characterized by respect and trust.
DIMENSION #7: Data, Documentation, and Evaluation:
All involved organizations reliably capture accurate and meaningful data regarding the effectiveness, efficiency, and outcomes of their activities, and use this data to facilitate, and improve, the performance of those activities on an ongoing basis.
Th Sierra Health study directly linked the cost savings it identified to the manner in which Cottage Housing applied the following evidence-based best practices within its alternative intervention strategy:
BEST PRACTICES FOR SERVING HOMELESS FAMILIES IN SUPPORTIVE HOUSING
SOURCE: Supportive Housing for Homeless Families: Foster Care Outcomes and Best Practices by Sonja Lenz-Rashid, PhD, LCSW
The Sierra Health Foundation study describes how Cottage Housing established the basis for a cost-avoidance/savings-reinvestment approach to families otherwise served by institution-based interventions with the most expensive/least effective response to their needs.
The need for this approach is exemplified by a New York Times article reporting the busiest fire engine in the United States operates in the Tenderloin/South of Market District in downtown San Francisco. However, 98.5% of its calls were not to fight a fire, but instead responded to medical emergencies of homeless people. S.F. Fire Department’s Engine #1 gets more than 10,000 (7.5%) of 136,000 calls fielded annually by SFFD. With its annual budget of $330 million, this averages out to $2,426 per call – which makes tax payers’ cost of Engine #1’s homeless response services to about $24 million per year.
Obviously, a more targeted response to the medical needs of people living on the streets would not only accrue savings in the current year; those savings would snowball in each subsequent year the person helped remains outside the public health/welfare systems. But most counties calculate their operating budgets on a year-by-year basis, which diminishes opportunities for strategic initiatives that could redirect resulting multi-year savings to more effective use. To the contrary, a proactive department would lose any savings derived by such creativity at the end of the year.
An exception to this is Sacramento County, where Cottage Housing operates. Its Board of Supervisors approved a “carry-over incentive policy” to “encourage department heads to pinch pennies” by taking longer-term cost-effectiveness into account. In preliminary discussions with Sacramento County’s Department of Human Services director, he estimated that direct and indirect cost of all public systems could be as much as $100,000 per high-need families in the Child Protective Services (CPS) system. Evidence that 90% of families reunified at Serna Village did NOT return to the CPS system justifies an expectation that the savings identified in the Sierra Health study occur not only in the current year, but are accrued in future years as well.
From these premises, we began to develop the case for the cost-avoidance/savings-reinvestment initiative. To make these projections most conservative, the chart at the top of this page shows fewer families leaving the Serna Village program each year than its annual average during the last four years (2006-2009) of this study period (30 instead of 35). The chart also reduces the $100,000-per-family/per year cost estimate by 75%, and increases Serna Village’s recidivism rate to 33% - far higher than the 10% long-term stabilization rate documented in the Sierra Health study). Allowing for an estimated 2% inflation rate, this model shows a relatively small number of families graduating annually generates a $11 million surplus over eight-year years after program reinvestment costs are deducted. This constitutes nearly a nearly 60% surplus on $20 million projected gross savings, but cut these estimates by half again and more than a million-dollar surplus is generated. (NOTE: A less conservative estimate reducing the $100,000 annual cost estimate by 50% shows a gross savings of over $41 million over the eight-year period, with 78% of that total accrued as net savings – over $30 million dollars).
The director of Salt Lake City’s homeless services program went through this exercise after reading a federal report stating each homeless person costs tax payers between $30,000 and $50,000 annually in hospitalization, incarceration, shelter and other homeless-related costs. Homelessness in Utah reduced by 91% statewide after he moved his state’s spending away from these consequences of the homeless problem and instead invested in its solution: more low-cost housing.
Cottage Housing’s embrace of “client governance”, “mutual accountability,” and other evidence-based best practices rooted in the Resiliency Model confirmed decades of research showing alternative approaches that offer more, better and faster results at less cost. The core message of this research: “Don’t undo the bad stuff. Build on the good stuff. That’s all we have.”
 NOTE: These estimates include direct service costs and only and do not include state and county administrative costs for managing this system. They also do not include the lower health, criminal justice, education and public welfare savings, or increased tax revenues as these children’s parents and eventually their children move – citing the words of one CHI alumna – “from tax-taker to tax-maker.” They also do not reflect the multi-year savings resulting from these children’s lower recidivism rate.
 More information on PTSD is available starting on page 186 of GOOD DOERS - NOT DO GOODERS.
 Piliavin, I., R. Matsueda, M. Sosin & H. Westerfelt. "The Duration of Homeless Careers: An Exploratory Study." Social Service Review, 1990
 Child Welfare League of America - “Why Are Children in Foster Care,” from Children, Families and Foster Care (1995)
 Institute for Children & Poverty “A Welfare Reform – Homelessness – Foster Care Connection?” (1999)
 Roman, Nan P., Wolfe, Phyllis “Web of Failure: The Relationship Between Foster Care and Homelessness” National Alliance to End Homelessness (1995) 9
 Institute for Children & Poverty – “Children, Families and Foster Care;: Why Are Children in Foster Care,” Child Welfare League of America (1995); “A Welfare Reform – Homelessness – Foster Care Connection?”, (1999).
 Coalition Homes (affiliated with Montgomery County Coalition for the Homeless) and the Corporation for Supportive Housing - BEST PRACTICES MANUAL: Integrating Property Management and Services in Supportive Housing (2009)
 Nir, Sara Maslin - “San Francisco Fire Fighters Become Unintended Safety Net for the Homeless” New York Times 8/26/15
 $330,000,000 (SFFD annual 2015 budget) ÷ 136,000 (annual incidents/calls in 2015) = $2,426.47 (cost per call - aggregated) x 10,2219 (number of Engine #1 calls in 2015 (7.5% of total calls) = $24,800,955.88 (aggregated share of Engine #1 calls)
 Lewis, Robert – “Proposal Could Shift Job Duties” - Sacramento Bee (3/28/10)
 2/22/08 Conversation with Bruce Wagstaff when he was Director of Sacramento County Department of Human Services
 U.S. Interagency Council on Homelessness – “Ending Chronic Homelessness” (1/19/17)
 McEvers, Kelly – “Utah Reduced Chronic Homelessness By 91 Percent; Here's How” – NPR All Things Considered (12/10/15)
 Felps, Paula – “Rethinking Learned Helplessness” Live Happy (2/06) 16