United States General Accounting Office Testimony GAO For Release HC@lELFSSNESS: on Delivery Status of the Surplus Property Program, the Expectedat 9:30 a.m. EDT Interagency Council on the Hcmeless, and FE&IA's Thursday FFS Program July 19, 1990 Statement of John M. Ols, Jr., Director, Housing and Ca7nnunity Developent Issues Before the Cmmittee on Governmental Affairs United States Senate GAO/T-RCED-90-98 GAO Form 180 (12/87) Mr. Chairman and Members of the Committee: I am pleased to be here today to discuss our work related to the Stewart B. McKinney Homeless Assistance Act. Specifically, I will discuss the use of federal property for the homeless, the activities of the Interagency Council on the Homeless, and the Federal Emergency Management Agency's (FEMA) Emergency Food and Shelter Program (EFS). We are glad to assist the Committee in its deliberations on the reauthorization of these three key parts of the act. In summary: -- Based on our ongoing work, we believe that several improvements to the title V federal property program are needed to make it easier for assistance providers to apply for vacant properties. Most important is to ensure that the government determine that no federal use exists for the properties before the properties are publicized as being available to providers. Comprehensive federal guidance on how to obtain federal properties also would assist providers. -- On a more positive note, the Interagency Council on the Homeless (title II of the McKinney Act), has made significant changes in its services and operations. These changes, identified in our recently issued report, include the creation of full-time regional coordinators and improved leadership by the current Council Chairman, the Secretary of Housing and Urban Development (HUD).' -- Finally, in our May 1989 report, we noted problems with the timeliness of funding for FEMA's EFS program (title III lHomelessness: Changes In the Interagency Council on the Homeless Make It More Effective (GAO/RCED-90-172, July 11, 1990). of the McKinney Act).2 Our follow-up work shows that FEMA has taken positive steps to correct this problem and funds are reaching providers in a more timely fashion. I would first like to discuss the work we performed at your request, Mr. Chairman, and at the request of the Government Activities and Transportation Subcommittee, House Committee on Government Operations on the title V federal property program, We will be issuing a report on this SubJect in the near future. FEDERAL PROPERTY PROGRAM --PROBLEMS AND ACTIONS BEING TAKEN The Stewart B. McKinney Homeless Assistance Act (P.L. 100-77, July 22, 1987) was enacted in response to what the Congress considered to be an immediate and unprecedented crisis due to the lack of shelter for a growing number of individuals and families. A mayor purpose of the act is to use public resources and programs to meet the urgent needs of the nation's homeless. Title V of the act addresses this purpose by allowing organizations providing assistance to the homeless an opportunity to lease vacant federal property for a nominal fee. The properties are used for various services, such as emergency shelters and facilities for feeding the homeless. The initial federal response to leasing federal properties to the homeless was inadequate, and it took a lawsuit and several court orders to get federal agencies to begin the process of making federal property available to the homeless. According to HUD officials, from January to June 1990 HUD reviewed 7,666 properties for potential use by the homeless and, using broad criteria it developed with the Department of Health and Human Services (HHS) and the General Services Administration (GSA), has found about 52 2Homelessness: HUD's and FEMA's Progress in Implementing the McKinney Act (GAO/RCED-89-50, May 11, 1989). 2 percent suitable.3 Thirty-nine properties have been leased or are in the process of being leased,as transitional housing projects, emergency shelters, multi-service centers, and facilities for feeding the homeless. Our work identified various reasons why so few properties had been leased or made available to the homeless: -- Not all properties identified as suitable are usable for a variety of reasons: for example, they may be too distant from homeless populations. -- Identifying federal properties in the Federal Register as suitable for the homeless before it is known whether they are available can be misleading. -- Publicity for available properties has been inadequate. -- Comprehensive federal guidance on how to obtain properties is lacking. In addition, agency officials and assistance providers told us that use by the homeless of vacant federal property is limited because providers are not able to arrange financing to renovate existing structures or build new structures on leased property. The McKinney Act only authorizes leasing, not donating, of federal properties. Finally, our review of the leases in use for the title V program show that they may increase the government's liability and costs. 3This is not a cumulative number because HUD reviews the suitability of federal properties on a continuous basis and thus some properties may be double-counted. 3 Lawsuit on Title V In September 1988 advocates for the homeless sued the federal government because the agencies involved in implementing title V of the McKinney Act were not reviewing federal properties for their suitability for homeless use. The U.S. District Court, District of Columbia, concluded that the federal agencies were not properly implementing the act. The court issued a preliminary injunction against the federal government on September 30, 1988, prohibiting federal agencies from disposing of any federal property not in active use before being reviewed under title V, section 501. In subsequent court orders, the court set forth specific steps to be taken by HUD, HHS, GSA, and other federal landholding agencies to fully comply with the requirements of the McKinney Act. Current Procedures Have Hindered Program Success Despite the court orders, problems still remain that limit the usefulness of the program. Most importantly, the procedure established by title V (and as subsequently interpreted by the U.S. District Court, District of Columbia) to identify federal properties for use in assisting the homeless does not permit assistance providers to be certain that the properties they apply for are actually available for use. Suitable properties are published by HUD in the Federal Register before the landholding agencies, including GSA, decide whether there is a federal need for the properties or if they will be made available for use by the homeless. Therefore, assistance providers may apply-for properties that are not available for public use and HHS must review these applications even though the properties may not become available to assistance providers. HUD, HHS, GSA, and Council officials agree that availability of the federal properties should be determined by landholding agencies before the property is publicized in the Federal Register 4 as suitable for use by the homeless. Currently, there is a time limit for determining availability on certain classes of federal property but not others. A reasonable time limit should be established for all federal property. Title V would have to be amended to allow such a procedure. Another procedural issue that we believe is important is ensuring that property be withheld from other uses until HHS acts on assistance provider applications. The court required that property be withheld from other uses to allow time for notices of intent to apply or for HHS to complete action on the application. Currently, according to officials of agencies controlling most of the vacant federal property, they are following the holding period required by the court order. Although the agencies could confirm this procedure through regulations covering the title V process, they have not done so. Incorporating this change into title V would statutorily mandate a holding period. Assistance Providers Dissatisfied With Program Publicity Another barrier to making federal properties available under title V has been inadequate program publicity. In November 1989, we conducted a telephone survey of those persons and/or groups interested in federal property. Our survey showed that methods other than publication of properties in the Federal Register are needed. For example, a representative of a provider group told us that unless the group is on a mailing list or is sent information by someone who is, it often does not find out about the properties listed in the Federal Register. Representatives of the Interagency Council on the Homeless, HUD, HHS, and GSA, also told us that providers reported that the Federal Register notices are not readily available. To improve this situation, separate publicity efforts have been or are being developed by HUD, GSA, and the Interagency 5 Council on the Homeless.4 HUD has recently implemented an outreach program using its field offices to publicize vacant federal properties. GSA is sending notification of each suitable excess and surplus property to a wide range of interested persons, state and local officials, newspapers, and local post offices. The Interagency Council on the Homeless has taken steps to increase publicity of the title V program. The Council’s 1989 annual report states that to improve the record of making federal property available, the Council is pursuing the goal of more widely disseminating information about suitable and available properties. It has already published and distributed program information on federal property. We have not evaluated the effectiveness of any of these increased efforts. However, we believe these actions are steps in the right direction and should give assistance providers a wider range of opportunities to learn about federal property for which they might apply. Comprehensive Guidance Would Help Agencies Implement Title V Three years after title V was enacted into law, there is still no comprehensive federal guidance on how to obtain federal vacant properties. As a result, assistance providers cannot go to one source to learn how this program works. To improve the implementation of title V, the Council, GSA, HHS, and HUD are jointly developing a comprehensive program regulation. In a July 13, 1990, meeting, the Council's Executive Director told us that a draft regulation is currently being reviewed by HUD, GSA, and HHS officials and efforts are being made to finalize it as soon as possible. We believe that the guidance, if implemented, will help assistance providers. 4HHS does not play a role in publicizing federal properties. 6 Providers Say Leasing Limits Program's Potential Some assistance providers told US that the title V federal property program limits their ability to arrange financing to rehabilitate existing structures or to build new structures because they are only able to lease federal property. If the property requires substantial investment, the provider has two problems: difficulty in obtaining a loan on leased property and the likely loss of the investment when the lease expires and possession of the property reverts to the federal government. Some providers believe that an outright gift of the property would ease their problems in obtaining the necessary rehabilitation financing. According to providers, agency officials, and organizations assisting the homeless that we spoke to, transfer of title from the federal government would give providers a better opportunity to obtain loans that could then be used to rehabilitate existing buildings or to build new structures. However, the question of donating federal property needs to be balanced with the monetary worth of the property to the federal government. Leases May Expose the Government to Liability and Costs During our review of title V, we also examined the leases now in use for McKinney Act property and found that they may expose the government to potential liability claims from, among other things, litigation by persons harmed because of physical defects of the properties. In addition, local jurisdictions may seek compensation for the additional costs incurred (such as emergency services for shelter residents) associated with nongovernment use. Changes in the leases could minimize potential problems associated with these factors. 7 Conclusions In summary, Mr. Chairman, improvements are needed in title V program procedures. Specifically, the most important procedure that needs correcting is that lists of suitable federal properties should be publicized only after it is determined that the properties are available. This would avoid wasted time and effort and would not unduly raise expectations on the part of assistance providers who apply for the properties and agency officials who review the applications. In addition, we believe that comprehensive guidance regarding title V should be issued as soon as possible. Furthermore, the question of whether to lease or to donate property needs to be considered from the dual viewpoint of the benefits to the homeless and the monetary worth of the property to the federal government. Finally, actions should be taken on McKinney Act leases to ensure that the government's liability and costs are kept to a minimum. INTERAGENCY COUNCIL ON THE HOMELESS IMPROVES ITS ACTIVITIES AND SERVICES I would like to turn now to our work on the Interagency Council on the Homeless. Title II of the McKinney Act created the Interagency Council on the Homeless as an independent establishment within the federal executive branch. Seven different agencies administer 18 McKinney Act programs. The McKinney Act charged the Council with reviewing all federal activities and programs to assist the homeless and with reducing duplication of effort among federal agencies. To achieve these goals, the Council is further charged with monitoring, evaluating, and recommending improvements in programs and activities to assist the homeless; providing professional and technical assistance to public and private organizations serving the homeless; collecting and disseminating information; and reporting annually to the President and the Congress on activities dealing with the homeless. The Council is 8 scheduled to cease operations on October 1, 1990, unless reauthorized. The Council is composed of the heads (or their representatives) of 15 federal agencies: headquarters staff in Washington, D.C.; 10 full-time regional coordinators provided by HUD; and part-time field coordinators provided by the other member agencies. The activities necessary to carry out policies and priorities established by the Council are further developed by a policy group, assisted by Council staff. From fiscal years 1988 through 1990 the Council has been appropriated a total of about $3 million. Council Operations Improve In March 1989 hearings before the House Subcommittee on Government Activities and Transportation and the House Subcommittee on Employment and Housing, we testified that the Council's efforts to meet its statutory responsibilities under the McKinney Act were inadequate and ineffective.5 We identified several matters that hindered the Council's effectiveness, including inadequate policy guidance or direction from the previous Chairman and uncertainty among working-group members about the Council's role. Most importantly, we found that the Council did not provide critical McKinney Act program information to state agencies and local assistance providers, thus possibly precluding providers from receiving federal assistance. Since our March 1989 testimony, we have reevaluated the Council and found that it has made the following significant changes to improve its implementation of the McKinney Act: 5Status of Activities of the Interagency Council on the Homeless, (GAO/T-RCED-89-16, Mar. 15, 1989). 9 -- developing policies and guidance to direct its activities, -- conducting on-site visits to assistance providers to determine how well the McKinney Act programs were working, -- providing technical assistance to providers through briefing sessions and regional workshops, -- providing McKinney Act information to over 25,000 individuals and groups, and -- developing an annual report with recommendations focused on federal assistance efforts for the homeless, which we believe will be useful to the Congress in its policy deliberations. Council's Leadership Has Improved In our March 1989 testimony, we testified that the former Council Chairman, the previous Secretary of HUD, did not provide adequate policy guidance and management direction regarding federal assistance efforts for the homeless. As noted in our recent report, Council leadership has improved. According to the current Executive Director, the current Chairman, the present Secretary of HUD, provides regular policy guidance and management direction to the Council at the Council's quarterly meetings and through frequent meetings with his Council representative and the Executive Director. Also, both the current Chairman and Vice Chairman, the Secretary of HHS, have visited shelters for the homeless. These visits resulted in a January 1990 memorandum of understanding between HUD and HHS pledging that the Departments would develop and implement joint initiatives for assisting homeless families with children, welfare families in public or assisted housing, and homeless individuals with serious mental illnesses. According to the Council's Executive Director, since the memorandum was signed, 10 HUD and HHS have jointly trained their staffs on each other’s homeless programs. Improvements In System Of Regional Coordinators The McKinney Act requires the Council to provide professional and technical assistance on programs for the homeless to states, localities, and other public and private nonprofit agencies. In our March 1989 testimony, we stated that, although the Council's part-time regional coordinators were important connectors linking the Council with the states, only about half of the coordinators were active in their outreach effort. We also concluded that the regional coordinators had problems obtaining information from the Council and suggested during testimony that establishment of full- time coordinators would help. In our recent report we noted that the current Council has addressed these problems. In May 1989, the Chairman of the Council provided 10 HUD employees to work full-time as the Council’s regional coordinators in each of HUD's 10 federal regions. These full-time coordinators work with the 124 field coordinators, who assist the Council on a part-time basis, having other regular agency responsibilities. The principal duties and responsibilities of the full-time regional coordinators are to provide technical assistance in the field, to promote the use and implementation of the McKinney Act programs by the public and private sector, and to provide direction to the part-time field coordinators. Assistance providers have told us that the coordinators have been extremely helpful. Improvements In Council Services In early 1989 we conducted a telephone survey of 18 state officials and 11 local assistance providers to obtain their views of the Council’s effectiveness. Almost half of the state officials we talked to had not been contacted by the Council’s, then part- 11 time, regional coordinators. In other instances, the Council had not provided the information needed to effectively implement and coordinate McKinney Act programs at the state level. Our March 1989 testimony included the results of this survey. Our July 1990 report updated this survey of 24 of the 29 state officials and local assistance providers to determine whether their perception of the new Council's activities differed from the services provided by the previous Council. Over two-thirds of the respondents who rated the Council said that the Council was "somewhat" to "very effective" in monitoring, evaluating, and recommending improvements in programs; providing professional and technical assistance; and collecting and disseminating information. In addition, approximately two-thirds of the respondents said that the Council should be reauthorized because it is doing a good job coordinating federal assistance programs for the homeless. Conclusions Under the leadership of the current Chairman and Executive Director, the Council has made substantial improvements to correct past problems. The creation of the 10 full-time regional coordinators has strengthened the Council's field coordination efforts. In addition, state officials and local assistance providers we contacted said that the Council's activities and operations were somewhat to very effective. Also, the Council's 1989 annual report focused on federal assistance efforts for the homeless and made recommendations that we believe will be useful to the Congress in its policy deliberations. Therefore, in our July 1990 report, we recommended that the Congress reauthorize the Interagency Council on the Homeless. This reauthorization would allow the Council to coordinate the McKinney Act programs and help to ensure that the homeless receive the assistance the Congress provided through the McKinney Act. 12 FEMA'S EMERGENCY FOOD AND SHELTER PROGRAM I will now discuss FEMA's EFS program, which is an important source of funds for thousands of homeless shelters and assistance providers. Under title III of the McKinney Act, the program is designed to get funds quickly into the hands of food and shelter providers to alleviate the most pressing needs of homeless persons. EFS is the single largest McKinney Act program. The EFS program was established to provide supplemental funds for homeless shelters and other service organizations for items such as food, supplies for shelters, and rental and utility assistance to households. Since passage of the McKinney Act in 1987, funding for the program totaled $495 million. All 50 states, plus Washington, D.C., and six territories receive EFS funding. In fiscal year 1989, about 65 percent of EFS funds was used to supplement the need for emergency food, shelter and supplies; the remaining 35 percent was used for assistance, such as rent, mortgage, and utility payments, to prevent homelessness. The EFS funds are distributed by a national board, which is chaired by FEMA and administered by the United Way. The board's membership, in addition to FEMA, includes six national charitable organizations. The funding allocation decisions are based on several factors, including current annual national unemployment rates, local totals of unemployed persons, and total numbers of persons below the local poverty level. The fiscal year 1990 appropriation was allocated by the national board to about 2,200 state and local boards, which in turn distributed the funds among almost 9,000 service providers. Although we have not evaluated the effectiveness of the EFS program, in our May 1989 report we identified problems with the timeliness of FEMA's program funding. Many service providers 13 complained that they did not receive EFS funds in time for the beginning of winter, when demand for shelter and food increased significantly. In following up on our earlier work, we have learned that FEMA has shortened the time it takes to send out the funds to service organizations. For example, FEMA sent out its first checks for the 1989 allocations in early November, as compared with a first check date of January the year before. Mr. Chairman, this concludes my statement. I am also providing two attachments: one listing the federal properties applied for and/or leased or permitted for homeless use as of September 30, 1989, and another listing the GAO reports issued on homelessness as of July 1990. I would be pleased to respond to any questions you or other members of the Committee may have. i 14 ATTACHMENT I A'ITA(2HMEN'I v) v) .:: 8 8 e 0 80 SHH 00s‘SE5 r68/0f/6 30 se $mdazd 000‘005 EuJaq aseal 000’092 18 000’046’19 “6WOW6 go se \fi3 103 OaZ’SZZ s pa1sanba.l xl.3uu6~ssQ ooo’osc 5 =iG un”“e xx3 000'9 s ‘%I -bs 005’1 url""e lad SffH 4 f=.-oxldesrp 000'8 S uq 7eq t&IQ ‘23 -be OOZ’Z luluue XKI 000’01 $ '23 -b-3 OOS'Z unuue md 000 ‘82 -000’02 s '23 -bs OOO'L-s unuue xx3 OOB’PZ $ -13 -bs OOZ'9 unuue lad 000’21 $ '33 -bs OOO'E unuue &XI OOO’P $ ‘23 -km 000’1 ATTACHMENT II ATTACHMENT II GAO REPORTS ON HOMELESSNESS AS OF JULY 19, 1990 Homelessness: Changes in the Interagency Council on the Homeless Make it More Effective(GAO/RCED-90- 172, July 11, 1990). Homelessness: McKinney Act Reports Could Improve Federal Assistance Efforts(GAO/RCED-90-121, June 4, 1990). Homelessness: Too Early to Tell What Kinds of Prevention Assistance Work Best(GAO/RCED-90-89, Apr. 24, 1990). Homelessness: McKinney Act Programs and Funding for Fiscal Year 1989(GAO/RCED-90-52, Feb. 16, 1990). Homelessness: Homeless and Runaway Youth Receivinq Services at Federally Funded Shelters(GAO/HRD-90- 45, Dec. 19, 1989). Homelessness: Additional Information on the Interagency Council on the Homeless(GAO/RCED-89- 208FS, Sept. 22, 1989). Children and Youths: About 68,000 Homeless and 186,000 in Shared Housing at Any Given Time(GAO/PEMD-89-14, June 15, 1989). Homelessness: HUD's and FEMA's Progress in Implementing the McKinney Act(GAO/RCED-89-50, May 11, 1989). Status of the Activities of the Interagency Council on the Homeless(GAO/T-RCED-89-16, Mar. 15, 1989). Welfare Hotels: Uses, Costs, and Alternatives(GAO/HRD-89-26BR, Jan. 31, 1989). Homeless Mentally Ill: Problems and Options in Estimating Numbers and Trends(GAO/PEMD-88-24, Aug. 3, 1988). 21 ATTACHMENT II ATTACHMENT II Implementation of Programs Under Titles III and IV of the Stewart B. McKinney Homeless Assistance Act(GAO/T-RCED-88-16, Jan. 26, 1988). Homelessness: Implementation of Food and Shelter Programs Under the McKinney Act(GAO/RCED-88-63, Dec. 8, 1987). Homelessness: A Complex Problem and the Federal Response(GAO/HRD-85-40, Apr. 9, 1986). Federally Supported Centers Provide Needed Services for Runaway and Homeless Youth(GAO/IPE-83-7, Sept. 26, 1983). 22
Homelessness: Status of the Surplus Property Program, the Interagency Council on the Homeless, and FEMA's EFS Program
Published by the Government Accountability Office on 1990-07-19.
Below is a raw (and likely hideous) rendition of the original report. (PDF)