Can Texas handle the increase in homeless and low-income weatherization funds?

All of the money coming to Texas from the economic stimulus bill is a great thing. But as the size of the program begins to sink in there is reason to be concerned over the State’s ability to spend so much money so fast.

Two of the programs that are causing the most concern by the low income weatherization and the funds to assist a homeless. Historically Texas receives $4.8 million in homeless assistance funds. Under the bill the State of Texas will receive about $48 million of homeless assistance funds to disperse and entitlement cities and counties will receive even more bringing the total to $103,967,796 for the state.

Speaking in his usual diplomatic style, Michael Gerber, executive director of the Texas Department of Housing and Community Affairs testified before a House committee last week that, “we do believe we will have significant questions about the capacity of those who would be using those funds. … We’ve generally awarded funds in $50,000-$100,000 increments (to 70 to 80 homeless providers).”

If the funds were divided up among existing homeless providers the typical grant amount would go up from the current level which Gerber described to the committee is being “$50,000-$75,000” to an average of $1.3 million per provider. Many of these state-supported homeless providers are in smaller communities and operate small shelters that simply cannot absorb such a large amount of funds.

The state is going to clearly need to allocate a significant amount of this money for the construction of the transitional housing and single room occupancy housing (SRO)in order to fully utilize this appropriation.

Don’t get me wrong. There is a tremendous need for these funds, so much so that the mayors of the eight largest Texas cities formally requested the Legislature appropriated $25 million of additional funds for homeless assistance in light of the problems they’ve been encountering.

The task facing the state in low income weatherization is even more daunting. Traditionally funding has been about $13 million per year but under the stimulus bill. This year the state will receive $260 million. Eligible households must make below 200% of poverty and the amount of money expended to weatherize a home may not exceed $6,500.

Now, once again, this is not a matter of Texas not needing the money. There is a long waiting list for weatherization services. But instead, the question is how does the state gear up to deliver an unprecedented level of assistance with this massive new infusion of grant funds.

For the most part the program is now administered by community action agencies. Michael Gerber, in his testimony last week, indicated that it was the state’s intent to “fill up the capacity of the existing providers but since this is a place where it goes so far beyond that this is a place that outsourcing makes sense.” In other words, the state is going to gear up and find additional contractors to do weatherization for low-income households.

This is the correct approach.

For years homeless and weatherization programs have limped along with anemic funding levels. The effect has been to reduce the capacity of traditional providers of services to deliver those services at this point. It is absolutely essential that these funds be extended in a timely manner because the receipt of additional funds that may be available through national competitions is dependent upon the successful expenditure of the first round of funding.

Handling the increase in homeless and low-income weatherization funds will require rapid and aggressive implementation of the program on the state’s part along with an unprecedented effort on the part of homeless providers, housing providers, community action agencies  andthe state’s construction industry.