Seattle Rejects Biden Administration Offer to Pay Full Cost of Hotel-Based Shelters

by Erica C. Barnett 

(This article originally appeared on PubliCola and has been reprinted under an agreement.) 

As funding runs out for JustCARE, a program that has moved more than 100 very high-needs people from tent encampments in Pioneer Square and the International District into hotels where they receive case management and services, Mayor Jenny Durkan’s office has made it clear that it considers one source of funding off the table: money from the Federal Emergency Management Administration (FEMA), which recently announced it would pay 100% of the cost for eligible hotel-based shelters.

“While we appreciate the work of President Biden’s administration,” City Budget Office Director Ben Noble and Office of Emergency Management Director Curry Mayer wrote in a letter to Seattle City Councilmembers this week, “there continues to be no option to receive 100% reimbursement of the operation and services of non-congregate shelters for individuals experiencing homelessness in King County or Washington.” In other words, the City is grateful that the new administration is offering to pay for hotels; they just don’t consider it a viable option for Seattle.

Advocates for JustCARE, which serves unsheltered people with disabling behavioral health conditions, have been arguing for months that the City should seek FEMA reimbursement for the program, whose funding from King County runs out March 15. Without funding, the program will need to “exit” 124 substance-addicted people — most of them with disabling mental health conditions — onto city streets, at a time when both homeless advocates and business boosters agree that there are an unacceptable number of tents on sidewalks and in parks around the city. 

The program, which is a partnership between the Public Defender Association (PDA), Asian Counseling and Referral Service, REACH, and the Downtown Emergency Service Center, provides non-congregate shelter options now that the COVID pandemic has reduced capacity in congregate shelters.

“Given the state of downtown, regardless of your opinion and how you characterize the root causes or anything else, we cannot have 124 more individuals who are suffering from meth addiction and mental health conditions leaving hotels where they are currently getting their needs met” and going back onto downtown streets, Councilmember Andrew Lewis, who represents the center city, said earlier this week.

Under the Trump Administration, FEMA reimbursed jurisdictions 75% of the cost of COVID-related expenditures, including shelter; once President Biden took office, however, that number increased to 100%, retroactive to January 2020, prompting cities across the country to take advantage of the new, more generous reimbursement opportunity. Shelter advocates were urging the City to fund shelter now and seek reimbursement later even when the feds were only funding 75% of the cost; it’s critical, they argue, not to leave any resources on the table.

“It seems clear the Biden administration is sending a signal to use FEMA; if we qualify, we just have to do the work and go through the steps,” PDA director Lisa Daugaard said. “We are willing.”

Other cities began renting hotels on the presumption of future reimbursement shortly after the pandemic began. San Francisco and Los Angeles, for example, have used FEMA dollars to pay for thousands of hotel rooms funded through Project Roomkey, California’s effort to bring people experiencing homelessness indoors. When the Biden administration announced the costs for efforts like Project Roomkey would be completely reimbursed by FEMA, local officials in L.A. called it “manna from heaven.”

Although advocates have criticized the State of California for its administration of the program, the complaints about Project Roomkey are generally that the State has acted too slowly to release the money, not that the program is too hard for cities to administer.

In Seattle, by contrast, Durkan has raised a series of objections to using the federal money for non-congregate shelters, including but not limited to JustCARE. Councilmembers say they were initially told FEMA reimbursement took too long — up to three years — which would force the City to advance the cost of hotels now in the hope of getting reimbursed at some point far in the future.

After it became clear that FEMA is reimbursing some jurisdictions, including King County, much more quickly, budget director Noble clarified that “cash flow” — the ability to cover expenses in advance of reimbursement — isn’t actually an issue, because the City has plenty of cash in reserve to withstand a lengthy wait. So far, the County has received about $22 million in reimbursements from FEMA for non-congregate (hotel-based) shelter for a period covering March through May 2020.

Another objection, specific to JustCARE, is that the County originally funded the program; therefore, it’s the County’s problem. For months, the mayor’s office has characterized JustCARE as a “County program,” on the grounds that public health is the County’s responsibility, not the City’s.  During a Council briefing meeting Monday, Council president Lorena González said this claim stands in stark contrast to the City’s stated commitment to a regional approach to homelessness.

“We’re either in this as a region or we’re not, and creating false lines about who funded what first to me signals that we are not wholly committed to this regional effort,” González said. “If we are truly committed to this as a region, it doesn’t matter that King County cut that first check or the size of that first check.”

Noble and Mayer’s Tuesday email raised seven additional objections — “key provisions,” as they put it, “that have impacted the City’s ability to fund hotel shelters with FEMA dollars.”

“Since last March, the City has advocated for federal government reimbursement for additional shelter resources, but unfortunately, it has been limited as it relates to non-congregate shelter,” the memo says.

Most of the issues raised in the memo boil down to procedural or administrative challenges in obtaining reimbursement — challenges other jurisdictions have successfully tackled, and that, in any case, have been in play since the beginning of the pandemic. “FEMA Reimbursement Must Be Approved and Is Not Guaranteed,” one bullet point begins. “Currently, every line item of our budget must be approved by FEMA. The documentation requirements are onerous.”

This challenge is not unique to Seattle; every city that has obtained FEMA reimbursement, including the cities that have used the funding to place unsheltered people in hotels, has had to jump the kind of bureaucratic hurdles that are part of dealing with the federal government.

Other issues the memo raises include the fact that FEMA funding requires pre-authorization from the feds, procurement requirements that cities have to follow, and limitations on what FEMA dollars can fund. For example, FEMA will only pay for hotel-based shelter beds that serve people who are “high-risk,” including people over 65 or those with underlying health conditions that make them vulnerable to COVID. Daugaard says all of JustCARE’s clients meet those criteria, as do all chronically homeless people — who, by definition, have disabling health conditions.

In short, the issues the City raises are challenging, but not insurmountable — if they were, then other cities would not have managed to surmount them, and Biden’s announcement last week would not have been widely heralded as welcome news by advocates and jurisdictions across the country.

As PubliCola has reported, the City is opening over 200 new hotel-based shelter beds sometime next month — the first direct investment the City has made in hotel shelters inside Seattle proper since the pandemic began. (The City did contribute some funding for a shelter at the Red Lion in Renton.) The so-called shelter surge, announced last year but just now getting underway, will use Emergency Solutions Grant dollars to fund hotel-based shelter and rapid rehousing programs run by Chief Seattle Club, the Low-Income Housing Institute, and Catholic Community Services. The PDA was initially chosen to run one of these programs, but its bid was rejected as too expensive.

In a follow-up to this story published at PubliCola on March 1, 2021, Eric C. Barnett addresses feedback from the office of Mayor Jenny Durkan criticizing this article and its conclusions.

Erica C. Barnett is a feminist, an urbanist, and an obsessive observer of politics, transportation, and the quotidian inner workings of City Hall.

Featured image is attributed to jlhervas under a Creative Commons 2.0 license (CC BY 2.0).

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