Homelessness: BIG Money?

Is "homelessness" an employment program for people who aren't homeless?

It is interesting how big the “helping the homeless” business is.

he United States Community Housing & Homeless Shelters business is expected to reach $22.2 billion in 2026. In South Dakota, that business is expected to be about $45.9 million. This money supports about 82 businesses with about 522 employees. Much of the money flows to state agencies and non-profits.

If we assume these employees make an average of $40,000 per year, the amount remaining for the homeless is about $25 million. Then there are expenses and the costs of the facilities themselves.

After all the expenses there isn’t much left for the homeless people.

According to SD Housing there are about 1145 homeless people in the state at any one time (this number has gone down from a few years ago). We could easily rent a few apartments and stock them with food for about $1400 per month per full time homeless person (housing, food). That’s about $19 million/year, a far cry from the nearly $46 million we are spending.

It is also interesting to note that more money does not seem to be the solution. In 2017, Los Angeles put in a quarter-cent sales tax (Measure H) to fight homelessness. This special sales tax was estimated to raise $3.55 billion over 10-years to fund homeless services and prevention. Measure H also allowed $41.1 million to be advanced to Peter Lynn of the Los Angeles Homeless Service Authority (LAHSA). Despite all the money, the number of homeless grew by 33% during Lynn’s tenure as Executive Director of the LAHSA. It is also interesting to note that Mr. Lynn was being paid around $250,000 per year.

Perhaps we need to take a closer look at our homeless programs and come up with a more efficient and effective way to help the thousand or so people who are homeless at any one time.