Los Angeles receives more federal homelessness assistance funding than any other region of the country.

So, on June 11, when the US Department of Housing and Urban Development (HUD) announced that it was immediately suspending more than $200 million in federal funding to the Los Angeles Homeless Services Authority (LAHSA) while it investigates fraud, mismanagement, and waste, it sent a shock wave across the nation’s homelessness service providers. 

For years, LAHSA, the regional entity entrusted with federal homeless assistance funding, has been the subject of warnings, complaints, audits, and a lawsuit against the City and County of LA.

LAHSA’s performance has been characterized as “a bowl of spaghetti,” “cutting blank checks,” “broken,” and “smoke and mirrors.”

Since 2001, HUD audits of LAHSA‘s “Continuum of Care” program have highlighted a history of persistent problems, including failures to monitor grantees, paying ineligible expenses, and poor financial management.

The “Continuum of Care” program, according to HUD, “is designed to promote communitywide commitment to the goal of ending homelessness by providing funding for efforts by nonprofit providers and State and local governments.” It also is supposed to help homeless people access government services.

But in LA, thanks to LAHSA, Continuum of Care is a mess.

The LA County auditor-controller and LA city controller each expressed concerns over LAHSA’s poor payment and reimbursement systems; inflated number of people housed and double counting; data quality issues; and internal accountability issues.   

LAHSA stonewalled a professional management firm that evaluated it in the course of the lawsuits mentioned above. The final report showed that LAHSA doesn’t know how much it’s paying, to whom, for what, and whether money was well spent (or spent at all).

LAHSA doesn’t even know how to help an unsheltered person find a home for the night, and no one is verifying whether providers are delivering beds, housing or services.

LAHSA has become the target of national attention, thanks to the suspension of funding, and to the high-profile involvement of the White House Task Force to Eliminate Fraud.

But the problem isn’t isolated to LA.

Last year, Louisiana’s legislative auditor’s office attempted to gain access to data and records from Unity, the New Orleans organization that runs its Continuum of Care. The auditor was told to pound sand.  

Unity has been accused of a lack of spending transparency, unclear policies and strategies, and delayed reimbursements. The New Orleans/Jefferson Parish regional homelessness agency received $38 million in federal funds in 2024. But in response to the state legislative auditor, Unity joined with the six other Continuum of Care programs in Louisiana to file a motion in court to keep the state and taxpayers in the dark.    

Resisting accountability and transparency from federal homeless assistance recipients appears to be a pattern. Utah, Idaho, Arizona and Oklahoma all introduced legislation to improve transparency in homeless spending, and to understand better what the Continuum of Care programs do, what they accomplish, and what outcomes public money has achieved.

Instead of agreeing with the need for better performance and accountability, homeless services providers have actually testified against reforms.

HUD’s action to demand accountability at LASHSA — the nation’s largest and most lavishly funded regional homeless agency — is a welcome signal.

It comes as HUD has also announced tougher new standards for programs that receive billions in federal homelessness dollars.

Under Secretary Scott Turner and President Donald Trump, HUD is demonstrating that it’s serious about reform and accountability. 

That means getting serious about ending homelessness — finally.

Paul Webster is a senior fellow at the Cicero Institute, an Austin based research and public policy organization.  He is also the executive director of the LA Alliance for Human Rights.

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