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Considerations in performing a cost-benefit analysis of homeless assistance alternatives in Denver

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Considerations in performing a cost-benefit analysis of homeless assistance alternatives in Denver
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Schroer, William Michael
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Denver, CO
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University of Colorado Denver
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91 leaves : ; 28 cm

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Homelessness -- United States ( lcsh )
Homeless persons -- Services for -- United States ( lcsh )
Homeless persons -- Services for -- Colorado -- Denver ( lcsh )
Homeless persons -- Services for ( fast )
Homelessness ( fast )
Colorado -- Denver ( fast )
United States ( fast )
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bibliography ( marcgt )
theses ( marcgt )
non-fiction ( marcgt )

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Includes bibliographical references (leaves 77-84).
Thesis:
Submitted in partial fulfillment of the requirements for the degree, Master of Arts, Department of Economics
Statement of Responsibility:
by William Michael Schroer.

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ocm19817917
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Full Text
CONSIDERATIONS IN PERFORMING
A COST-BENEFIT ANALYSIS OF
HOMELESS ASSISTANCE ALTERNATIVES
IN DENVER
by
William Michael Schroer
B. A., University of Colorado, Boulder, 1976
A thesis submitted to the
Faculty of the Graduate School of the
University of Colorado in partial fulfillment
of the requirements for the degree of
Master of Arts
Department of Economics
1988


This thesis for the Master of Arts degree by
William Michael Schroer
has been approved for the
Department of
Economics
by
Julie L. Hansen
Date


Schroer, William Michael (M. A., Economics)
Considerations in Performing a Cost-Benefit Analysis of Homeless
Assistance Alternatives in Denver
Thesis directed by Associate Professor Mei-Chu W. Hsiao
This thesis examines the considerations in performing a cost-
benefit analysis (CBA) of homeless assistance alternatives in Denver.
Chapter I lists four specific reasons to perform this CBA scarcity of
resources and alternative uses of available resources, maintenance
of homeless assistance funding, quality control, and political
volatility of homeless issues. Chapter II presents the determination
of the three primary homeless assistance goals emergency service,
transitional, and preventive assistance. The desire of society to
meet emergency service goals is not dependent on efficiency or
other economic criteria. However, allocating resources between
transitional and preventive homeless assistance goals should be
based on these criteria. Three fundamental public policy questions
surface in relation to this CBA: When and how does society best
allocate resources between transitional and preventive homeless
assistance goals once emergency service goals have been met?
Which approach is more efficient, transitional or preventive? And
finally, are there political or administrative considerations which
will prevent the most efficient allocation of resources? Chapter III
concludes with a suggested eleven-part homeless assistance CBA
framework. Chapter IV identifies the six subpopulations in addition
to the stereotypical male "hobo" or street person which make up
the new homeless population. They are families, youth, elderly,


IV
women, chronically mentally ill, and substance abusers. All
homeless persons can be grouped according either to their need
for transitional custodial care or transitional economic and social
rehabilitation. Chapter IV also examines the benefit considerations
generated by reaching each of the three primary homeless
assistance goals. Three different types of benefit were applied in
this analysisbenefits in money terms, incommeasurable, and
intangible benefits. Chapter IV finally suggests the Denver
"homeless community" boundary to be the city limits of the City and
County of Denver. Chapter V reviews the significant cost
considerations per the three primary homeless assistance goals.
Chapter VI presents an overview of other political, administrative,
and economic considerations which may prevent fulfillment of the
primary homeless assistance goals and an equitable funding plan is
considered as part of the CBA's social impact analysis. The
conclusion and the future research plan for the expansion of this
topic are given in Chapter VII.
The form and content of this abstract are approved. I recommend
its publication.
Signed
Faculty member in/charge of thesis


CHAPTER I
INTRODUCTION
Homelessness has commanded significant public attention in
the United States and Colorado since 1983. In response to this
growing problem, President Reagan signed into law P. L. 100-77,
The Stewart B. McKinney Homeless Assistance Act, on July 22,
1987. Under the FY 1987 Supplemental Appropriations bill,
Congress appropriated $355 million to deal with the problems of
the homeless. According to the Stewart McKinney Act, a homeless
individual is defined as:
(1) an individual who lacks a fixed, regular and adequate
nighttime residence; and
(2) an individual who has a primary nighttime residence that
is -
(A) a supervised publicly or privately operated shelter
designed to provide temporary living accommodations
(including welfare hotels, congregate shelters, and transitional
housing for the mentally ill);
(B) an institution that provides a temporary residence for
individuals intended to be institutionalized; or
(C) a public or private place not designed for, or ordinarily
used as, regular sleeping accommodations for human beings.
Homeless assistance alternatives are increasingly being
considered and applied. Unscientific estimates place the number
of homeless persons in metropolitan Denver at 1500-2900. (Jones
1987) The composition of the homeless population also has been


2
difficult to estimate in Denver. The Washington D. C. based U. S.
Conference of Mayors indicate that America's major metropolitan
areas vary as to the percentage composition of this population (see
Appendix A). The City and County of Denver is currently engaged
with the Colorado Coalition for the Homeless, faculty of the
University of Colorado at Denver, and various homeless service
providers to develop one or two research surveys that will
scientifically estimate the number of homeless persons and better
clarify the percentage composition of the homeless population in
Denver from among the major homeless subpopulations. These
research instruments should help economists and other
researchers learn more about homelessness in Denver and about
the benefits, costs, and effectiveness of specific homeless
assistance programs. They could help in defining the particular
concerns and problems of the major homeless subpopulations.1
Since 1985, the City and County of Denver has contributed nearly
$4.5 million toward its homeless problems through city funds or
other governmental or private resources it controls. (Jones 1987 :
6-8) By comparison, Denver's annual Department of Social Services
budget (1987) is about $95 million. This Department has applied
about $1 million of this amount to welfare reform activities in 1987.
1 A significant stimulus for these research surveys was the Right-to-
Shelter ordinance initiative campaign in the spring of 1987. A key
homeless public-policy question emerged and remained unanswered: How
many homeless are in Denver? The first survey which will estimate the
homeless population should be completed by summer, 1988. Dr. Franklin J.
James of the University of Colorado at Denver Graduate School of Public
Affairs has been the key contributor to the development and design of
these surveys.


3
Causes of Homelessness
Although homelessness dates back to colonial times in
America, special forces have culminated in the 1980s to produce
what is commonly called the "new homeless."
Historically, the rise and fall in the number of homeless
appears to be directly related to the structure of the labor
market and overall economic conditions. Beginning in the late
1970s, there have been some large shifts in the composition of
the homeless. Joining economic conditions as a cause of
homelessness are two new factors that can broadly be grouped
into 1) significant shifts in social welfare policy, and 2) the
decline of the intact and extended family. (Erickson and
Wilhelm 1986 : Introduction)
A prominent shift in America's social welfare policies has
meant a reduction in affordable housing for lower-income persons.
High on the list of causes is the loss of affordable housing, as
the federal commitment to public housing and housing
assistance programs has disappeared and redevelopment of
urban areas (demolition of gentrification) has devoured
hundreds of thousands of units nationwide. A shrinking supply
and a growing demand leads, as one would expect, to upward
pressure on rents. (Jones 1987 : 5)
Additionally, spending on housing assistance has dropped
from $30 billion in the last year of the Carter administration to $7
billion in 1986. [The Denver Post December 27, 1987)
Another important shift in social welfare policies has been
the deinstitutionalization of chronically mentally ill persons without
adequate preparation of a community-based mental health system.
While getting chronically mentally ill persons out of large
state asylums was a brilliant idea, many states took advantage of
that policy shift to cut mental health costs. They failed to create
in the local communities, to which patients would return, the
kinds of housing, mental health, and social service supports
needed. (Jones 1987 : 6)


4
The broad groupings of significant economic changes, shifts
in social welfare policy, and family crises as causes of homelessness
do not really include substance (alcohol or drug) abuse, which has
long been associated with homelessness. Among those people who
used emergency shelters in the United States in 1984, 38 percent
were assessed by shelter operators as having a problem with alcohol
or other drugs. (HUD 1984)
Reasons for a Homeless Assistance Cost-Benefit Analysis (CBA)
Despite the significant amount of funds dedicated to the
homeless problem in Denver, there is currently no scientific basis
by which the various homeless assistance alternatives are
prioritized by the Denver region's homeless assistance
administrators and advocates. A CBA of these alternatives is a badly
needed public policy planning tool. This thesis examines the
considerations in performing this CBA of homeless assistance
alternatives in the City and County of Denver. A homeless
assistance CBA is a useful exercise for reasons relating to:
1. Scarcity of resources and alternative uses of available
resources. Society simply can not afford to waste precious public
and private resources available to combat homelessness. Welfare
reform as well as homelessness has caught the public's attention.
Both concerns depend on financial resources from many of the
same sources. A CBA can assist in the most efficient allocation of
resources to combat these policy concerns. For example, child-
care services are seen as an essential support service to homeless
and welfare families. However, child-care services require unique


5
arrangements and incur special costs when directed at either
welfare or homeless families. Homeless child-care services usually
involve extra transportation and security concerns. The Denver
Department of Social Services has at least one federal grant
program (Community Services Block Grant Program) which could
be applied to either homeless assistance or welfare reform
activities.
2. Maintenance of funding. A CBA can help justify
continuance of public and private contributions to fight
homelessness even if short-term efforts are not cost-effective. A
greater willingness to pay to support homeless assistance efforts
can be realized if certain alternatives are proved more efficient or
justifiable than others. For example, the costs to establish assisted-
living programs such as rent subsidy efforts may exceed the first-
year benefits accrued from the programs. However, over a longer
time period, these programs' benefits may exceed the initial costs.
A CBA can help determine the long-term benefits and costs of
pursuing the various homeless assistance alternatives.
3. Qualify control. A CBA can assist in determining the most
effective and efficient homeless assistance alternatives. This
benefits not only the homeless but the public-at-large by making
the best use of public and private resources and solving better the
social problems associated with homelessness.
4. Political volatility. The homeless issue is very vulnerable to
an array of political, moral, social, and other influences. A CBA can
lay a rational foundation for public-policy decision-making on the
homeless issue and can minimize imprudent or indiscreet


6
decisions. It can help cultivate homeless assistance strategies with
potential and help screen out costly or unreasonable strategies.
No evidence exists that a homeless assistance CBA has been
performed in the U. S. No economic models exist which allow
economists, other researchers, or administrators to compare and
evaluate the various homeless assistance alternatives. The
economic literature gives no specific guidance in the development
of a homeless assistance CBA. However, good CBA models exist in
other human service policy fields such as job training and housing.2
These models present a useful initial basis from which to develop a
homeless assistance CBA. Although excellent CBA models exist, an
analyst must establish his or her own CBA framework on the basis of
the myriad of variables which affect each analysis. Despite the room
this allows for scientific creativity, each CBA must be well grounded
in applied welfare economics.
Summary of the Thesis
Chapter II reviews homeless assistance goals throughout the
nation and in Denver. Homeless assistance goals must be clarified
and converted into operationally measurable form, or goal targets,
before benefits and costs can be estimated. Three primary
homeless assistance goals are identified emergency service,
transitional, and preventive homeless assistance. Chapter III
considers the essential components of a homeless assistance CBA
2 Specifically, Reeder (1985) and Thornton (1982) have developed CBAs in
the public housing and job training fields, respectively. Both CBAs were
helpful in the development of this thesis.


7
technical framework. The chapter reviews such components as the
different methods used to define benefits (benefits in terms of
money, incommeasurable benefits, and intangible benefits), time
analysis, and sensitivity testing. Chapter IV examines the nature
and scope of the homeless population in Denver. It also considers
the most significant benefits which should accrue from fulfillment
of the three primary homeless assistance goals. Chapter V reviews
the major cost considerations in the execution of specific homeless
assistance programs and other activities in order to achieve the
three primary goals. Chapter VI examines other homeless
assistance considerations which cannot readily be included in the
formal CBA quantitative analysis but which cannot be ignored by the
CBA analyst. These other considerations alone may prevent
execution of otherwise beneficial homeless assistance efforts. This
chapter reviews the social impact analysis which must accompany
the other formal components of the CBA analysis. An essential task
of the social impact analysis is to suggest an equitable homeless
assistance funding plan from among the public, private, and non-
profit sectors. The thesis ends in Chapter VII with the conclusion.


CHAPTER II
GOALS
The first exercise in considering a CBA framework with
respect to comparing homeless assistance alternatives is the
identification of specific homeless assistance goals. Once goals are
understood, the benefits of goal achievement can be estimated.
Program benefits relate to a program's desirable results. As
expressed by Haveman and Weisbrod (1983 : 80) "What is or is not
desirable depends, in turn, on the goals or objectives of the
program." To best evaluate the City and County of Denver's
homeless assistance goals, a comparison of these goals to those of
other significant homeless assistance efforts is in order.
Review of Homeless Assistance Goals3
A number of state and local governments across the country
have initiated formal homeless assistance planning and have
developed planning goals. By formal it is meant that there is an
official congregation of public, private, and non-profit organizations
assembled to plan or consider implementing homeless assistance
3 Prof. Bemie Jones of the University of Colorado at Denver's School of
Architecture and Planning has collected documents from throughout the
nation which list the goals of other municipal-, county-, or state
government-sponsored homeless assistance efforts. Prof. Jones graciously
allowed me access to these documents.


9
programs. The goals provide a guide for homeless public-policy
implementation and can be categorized as follows:
1. Emergency service. This refers to immediate, emergency
shelter for homeless persons for a period usually not exceeding
thirty days. Beyond sleeping accommodations and protection from
the weather, emergency service can include meals, laundry
facilities, local phone service, clothing, housing and job referral,
showers, and counseling. The best and most innovative emergency
shelter facilities are those which offer the greatest number of these
supportive services to facilitate a movement to transitional
homeless assistance services. (Redbum and Buss 1986)
2. Transitional homeless assistance. This is defined as
assistance provided for a period from thirty days up to two years.
Virtually every transitional assistance program defines the
transitional period differently, but transitional homeless assistance
facilities and services have the goal of providing the homeless
person a longer-term stable living environment to facilitate
rehabilitation and reintegration into society. (Redbum and Buss
1986) These facilities and services also have the goal of providing a
longer-term, stable custodial care environment for the previously
homeless person.
3. Preventive homeless assistance. This service attempts to
reduce the numbers of homeless by finding solutions for families
and individuals threatened with homelessness before they are
forced onto the street. Expansion of low-cost housing options and
rent or mortgage supplement programs are examples of preventive
homeless assistance programs.


10
Listed below are locations which address emergency service
and transitional homeless assistance goals through a formal
planning process.
Minneapolis St. Paul:
To facilitate homeless short-term, emergency assistance;
To facilitate homeless transitional or interim development;
and
To facilitate homeless long-term self-sufficiency or
stabilization and opportunities for full community participation.
(United Way 1987)
Tucson:
To provide the maximum opportunity for homeless people
to successfully integrate into the community; and
To reduce the negative impact of homeless people on the
community. (Tucson 1985)
Portland:
To reach out to homeless people who need help in
becoming part of the mainstream of community life,
To be firm with those who do not adhere to the community
standards; and
To create an environment in which business can flourish
and major economic development agendas can be pursued.
(Stone 1987)
Pittsburgh:
To help as many homeless people as possible to achieve
self-sufficiency; and
To provide decent and safe shelter and other essential life
support services to those homeless people who are capable of
achieving self-sufficiency. (Pittsburgh 1987)
Locations in the following group incorporate a more
comprehensive set of homeless assistance goals within their formal


planning process which include emergency service, transitional,
and preventive homeless assistance.
State of Maryland:
To expand resources for the prevention of homelessness,
and investigate possible changes in policies contributing to
homelessness;
To establish a strong emergency response to homelessness
throughout the State;
To significantly expand the supply of transitional housing
for those homeless people who need time and assistance to
stabilize their lives and establish their independence;
To substantially increase the variety and availability of
supportive housing for homeless people with special needs;
To develop an adequate supply of low-cost housing and
rental assistance programs to meet the permanent housing
needs of homeless and potentially homeless persons;
To augment the capability of the State to provide case
management services to homeless persons;
To promote self sufficiency for homeless and potentially
homeless people through job-training and employment
programs, legal counseling, transportation services, and day
care;
To improve the effectiveness of community-based programs
that provide medical and psychiatric services for homeless and
potentially homeless people; and
To foster cooperation and coordination among all levels of
government and all responsible State agencies, businesses, and
community organizations concerned with homelessness and
related issues. (Maryland 1986)
Seattle:
To create stable downtown neighborhoods by encouraging
services which address the needs of a variety of ages and
incomes and to create a climate in which all who live and work
downtown can feel comfortable and secure;


12
To provide high-intensity services to those who are
temporarily displaced to get them back on their feet in a short
period of time;
To create programs for homeless persons seeking
treatment for mental illness, alcoholism, and drug abuse, so that
they receive treatment comparable to private care, have an
opportunity for appropriate housing and support services, and
live and work in an environment which supports recovery;
To provide humane living conditions for those choosing not
to pursue treatment but not allow their interests to supercede
those of other residents; and
To encourage other jurisdictions and city neighborhoods to
provide comparable services to avoid oversaturation of any one
neighborhood with people having special needs. (Seattle 1986)
State of Michigan:
To promote interagency coordination on behalf of the
homeless to help assure that homeless persons have access to all
the benefits to which they are entitled;
To provide outreach services to shelter's soup kitchens,
and other locations which serve homeless persons;
To protect the lives, health, and safety of persons who are
currently homeless by assuring funding for necessary shelter
beds and services;
To improve coordination between state hospital discharge
practices and community treatment services to help assure
continuity of care and prevent homelessness among the
chronically mentally ill;
To clarify the legal status of young adults for service
program eligibility and propose necessary statutory changes so
that runaway/neglected youth may be served appropriately; and
To prevent future increases in homelessness by addressing
the long-range housing needs of low income persons, including
providing a continuum of residential options. (Michigan 1987)
Philadelphia:
To assure the availability of adequate emergency shelter
during the winter;


13
To develop long-range plans for adequate emergency
shelter for the future;
To evaluate current efforts by all providers of services to the
homeless;
To identify additional resources in both the public and
private sectors to combat homelessness;
To develop a comprehensive strategy for permanent
housing alternatives. (Philadelphia 1984)
Phoenix:
To provide shelter care to the homeless;
To promote independence and stabilization of lifestyle for
the homeless individual; and
To ensure independence and stability for homeless
individuals on a long-term basis. (Phoenix 1983)
Alameda County, California:
To prevent homelessness and to provide services to those
who are homeless. (Alameda County 1987)
Homeless Assistance Goals of the City and Countv of Denver
Since mid-1986, Denver Mayor Federico Pena has organized a
special homeless assistance task force called the Homeless Action
Group (HAG). The initial HAG mission was to present a plan
"representing a community commitment, to ensure that all
residents receive appropriate housing and other services necessary
to achieve and maintain a stable environment." (Jones 1987 : 1)
In the HAG's first public report released in February, 1987,
nine "guiding principles" were listed to guide specific homeless
assistance efforts in Denver. These principles are:
1) Homelessness is a real, not an imagined problem.


14
2) Homelessness must be addressed and not ignored.
3) The community must acknowledge that many persons
cannot provide for themselves and that it is up to the community
to provide for them.
4) The causes of homelessness are multiple and most are not
strictly locally based ones.
5) Homelessness is not new.
6) The homeless population is diverse and services to it must
reflect this.
7) Street people have a basic right to be left alone.
8) The purpose of homeless assistance efforts is to make
homeless persons self-sufficient economically.
9) Some homeless persons are antisocial and dangerous.
These guiding principles were the foundation for the
development of fifty specific homeless assistance recommendations
(see Appendix B) to be pursued by the City and County of Denver in
cooperation with other appropriate public and private agencies,
institutions, and groups. A review of these recommendations
indicate that Denver possesses a complete set of broad homeless
assistance goals. The recommendations embrace emergency
service, transitional, and preventive homeless assistance.
The second charge for the HAG since July, 1987, has been to
prioritize these recommendations and organize efforts to have
them implemented. The Denver Department of Social Services,
which supplies staff support for the City and County of Denver to
the HAG, suggested that the following criteria be considered in
determining homeless assistance priorities:
What impact will the recommendations have on
homelessness?


15
How achievable is the recommendation within the next
year?
How dependent is the recommendation on the occurrence
of other recommendations?
What are the resources presently available; what are other
necessary resources?
In a sense, these criteria resemble a crude CBA or cost-
effectiveness analysis (CEA). A CEA differs from a CBA by its focus
only on the cost comparisons of different programs or activities
necessary to achieve a specific goal. Yet, because the HAG's fifty
recommendations have not been evaluated or examined through a
qualified and rigorous CBA there is no assurance that they have
been prioritized according to economic efficiency and effectiveness.
Without a CBA of homeless assistance alternatives, prioritization and
implementation of these fifty specific measures and others which
may develop later are still unprotected from personal preferences
and political pressures and agendas.
The most rational course for any public and/or private
homeless assistance project to follow in addressing all three
primary homeless assistance goals (emergency service, transitional
needs, and longer-term preventive homeless assistance) is to fulfill
the immediate goal of meeting emergency situations then allocate
resources to both the intermediate goal of providing transitional
assistance and the longer-term goal of preventive solutions,
according to efficiency and other important criteria. Homeless
assistance needs will exist simultaneously in each goal area in all
cities and states. Those locations which presently focus only on
emergency service and transitional homeless assistance may be so


16
occupied with these more immediate priorities that preventive
measures have not yet been considered.
Certainly, meeting emergency service needs, primarily at
each of Denver's emergency shelters, constitutes a current
resource priority. Meeting homeless emergency service goals by
providing temporary, safe shelter often saves lives. Society appears
to consider cost-benefit information superfluous to the decision to
achieve emergency service goals; there is a strong political, moral,
and social commitment to meet these goals despite their costs.
Nonetheless, a homeless assistance CBA can be useful in evaluating
homeless emergency services by analyzing and comparing the costs
of the various programs which can meet specific emergency service
goals. A homeless assistance CBA must also include analysis of
emergency service goals to quantify and clarify the benefits from
successful emergency shelter program execution and the cost
savings when permanent homeless solutions are found.
Three primary public policy questions surface in relation to
this CBA. When and how does society best allocate resources
between transitional and preventive homeless assistance goals once
emergency service goals have been met? Which approach is more
efficient: transitional or preventive? Are there political or
administrative considerations which will prevent the most efficient
allocation of resources?
An estimation of the benefits derived from fulfilling each of
the primary homeless assistance goals will greatly contribute to, if
not dominate, discussions about homeless assistance planning and
funding. A homeless assistance CBA can help answer the three


17
fundamental questions posed above. A three-tiered set of goals
based on emergency service, transitional, and preventive homeless
assistance is the appropriate foundation for homeless public-policy
development.


CHAPTER III
HOMELESS ASSISTANCE CBA FRAMEWORK
CONSIDERATIONS
Even though each CBA is a unique expression of the analyst
who prepares it, there are necessary and well-established
components which must be included or at least considered in each
CBA. This chapter reviews those components and relates them to
the uniqueness of the homeless problem.
CBA is grounded in the language, logic, and values of welfare
and public investment economics.
This theoretical framework recognizes three primary
justifications for governmental intervention in a market
economy: (1) to achieve equity in the distribution of income;
(2) to stabilize fluctuations in aggregate economic activity; and
(3) to improve economic efficiencyfor instance, by correcting
market failure (e.g., regulating natural monopolies), providing
goods for which markets cannot function ("public goods"), and
correcting uncompensated losses and windfall gains to third
parties ("externalities"). Cost-benefit analysis, as it has been
practiced in the past and is still generally practiced today, has
concentrated primarily on economic-efficiency goals. The
fundamental concern of this approach is scarcity of resources.
Both in government and society, there are never enough
resources to do everything that people would like to have done,
so choices must be made. The good society is one in which all
resources are used for their highest valued purposes, and each of
these purposes is achieved in the most efficient and effective
way so that no resources are wasted. Good government
decisions are those that contribute to achieving these highest
valued purposes in the most efficient and effective ways.
(Andrews 1982 : 111)


19
Defining Homeless Assistance Benefits for Each Goal and Goal
Target
The benefits of achieving each of the primary homeless
assistance goals emergency service, transitional, and preventive
homeless assistance must be considered and estimated separately.
Each goal then must be broken into its various operationally
measurable forms or targets. As stated by Haveman and Weisbrod
(1983 : 81) "For each goal, an operational measure of the degree to
which the program achieves the goal is indispensable to program
evaluation." For example, the broad emergency service goal is to
shelter the homeless. A more specific operationally measurable
form of the goal might be the provision of emergency shelter to
90% of Denver's homeless population. Or, all emergency shelters,
in addition to sleeping facilities, should have provisions for food,
showers, and laundry services. By making the broader goals
specific to a level of service, the number or percentage of homeless
persons helped, or other quantifiable measure, benefits and costs of
homeless assistance alternatives can then be better estimated. For
the remainder of this chapter, goal targets refer to the specific
operationally measurable form of the three primary homeless
assistance goals.
Measuring Benefits
The first consideration in developing goal targets is
estimating the public-good value of resources saved or consumed
through homeless assistance efforts. The benefits can be valued


20
and quantified in economic terms even if the good that is received
from homeless assistance efforts is a public and not market good.
The measurable objectives necessary for evaluation may not
translate precisely into dollars to permit the desired cost-benefit
calculation. This should not forestall an evaluation. The task then
becomes to assess the desired change in shelter received or
whatever is the specific goal target. Economists as evaluation
analysts may then offer some guidelines regarding the dollar worth
of these changes. For example, a benefit estimate can be developed
on the basis of reductions in the number of arrests due to increased
emergency shelter capacity multiplied by the average cost per
arrest. These benefits are classified in money terms.
Incommensurable and intangible benefit considerations in reaching
the homeless assistance goal targets also must be included in the
CBA. Incommeasurables, according to Sassone and Schaffer (1978),
can be quantifiable in economic or noneconomic terms but cannot
be evaluated in money terms. Examples of incommeasurable
benefits are improvements in educational and health status.
Intangible benefits relate to unquantifiable benefits such as
prestige, self-esteem, beauty, peace-of-mind, etc. The
incommeasurables and intangibles must be included in the GBA
because as Haveman and Weisbrod (1983) point out, just because
something cannot be put into money terms does not mean it is not
a benefit. The incommeasurables and intangibles are the benefits
which can make programs justifiable when their monetary values
are insufficient. Despite the importance of incommeasurable and
intangible benefits, valuations based on monetary values are usually


21
more reliable and valid as predictors of the efficiency and
effectiveness of public programs.
Direct and Indirect Benefits
Those receiving direct benefits include homeless persons and
the residents, firm-owners, visitors, and commuters who live,
work, or visit in the existing City and County of Denver "homeless"
community. Determining the location, boundary, and definition of
the homeless community also determines which populations
receive indirect benefits from viable homeless assistance strategies
beyond the homeless community.
Negative Direct or Indirect Effects
In developing a homeless assistance CBA, negative direct or
indirect effects from successful execution of the various homeless
assistance programs within each of the three primary goal targets
must also be considered. For example, a popular transitional or
preventive homeless assistance program is job-training and
placement. If this program is geared up during periods of full
employment, there may be some costly labor displacement and
consequent downward pressure on the real wage rate. An
additional concern is that, if Denver's homeless assistance efforts
prove successful, the area could become an attractive migration
destination for other regions' homeless populations.


22
Costs
Two primaiy cost categories exist for the support of human
service programs such as homeless assistance efforts. First, there
are the direct program and administrative costs. These costs are
covered by a variety of sources from the public, private, and non-
profit sectors. The opportunity costs of competing alternatives
must also be considered. These costs can be measured in time or
money.
Note that in a fully employed economy, the primary benefits
also are achieved at the cost of displacing some other project
and its benefits. Such opportunity costs...enter in through the
inclusion of an interest rate (cost of capital) and through the
estimated cost of purchasing the resources required for the
project-resources that must bid away from competing uses.
(Haveman and Weisbrod 1983 : 91)
Haveman and Weisbrod's statement warrants some
elucidation. Note their reference to a fully employed economy. If a
homeless assistance project utilizes resources when the local
economy is not in a period of labor market equilibrium, (meaning
some of these resources would otherwise be idle) this project
would require less displacement of other activities and benefits
than would be the case if these resources were fully used. It is
critical to determine if the benefits of reaching a homeless
assistance goal would be greater than the benefits realized if these
resources were to be used in some other program. It would be
difficult to determine all the other program alternatives to make
this comparison. As suggested in Chapter I welfare reform may
offer a standard competing program alternative to homeless
assistance goal targets.


23
Time Analysis
Benefits must be evaluated according to their effect over time.
A time analysis is a necessary part of any CBA in order to properly
aggregate benefits and to correctly compare the benefits and costs
of various public programs. Usually there are three components of
time analysis:
base an estimate of the value of the benefit or cost in a
reference period;
time horizon an indication of how long future benefits are
assumed to exist; and
discount rate the rate at which future costs and benefits
must be discounted to determine their net present value. This
is based on the fact that a benefit or cost received at present,
measured as a given amount of dollars, is worth more than one
that is received some time in the future. (Thornton 1982)
Equity and Efficiency Considerations
Conventional CBA usually separates efficiency from equity
effects. Even though within a local government boundary the
benefits of a public program exceed the costs for it, the distribution
of benefits and costs may not be socially desirable. Many CBAs
include a social impact analysis which examines these distributional
concerns and may suggest solutions and alternatives.
A cost-benefit calculation may, indeed, be accompanied by
observations on the resulting distribution, and even by
recommendations in this respect. But the quantitative outcome
of a cost-benefit calculation in itself causes no distributional
significance. It shows that the total of gains exceeds the total of
losses, no more. (Mishan 1982 : 164)


24
The basic needs or donor benefit approach offers an excellent
model to consider the benefits of social action programs such as
homeless assistance efforts.
The essence of the basic needs approach is therefore the
recognition of an externality associated with improvement (or
deterioration) in the extent to which the basic needs of
specified segments of society are met. The most obvious
motivation for such an externality is altruism...It now becomes
clear that our respective, individual quantification (willingness to
pay) at the fact of a poor child being better nourished [or a
homeless person given shelter] is something of a public
good...My willingness to pay for better nourishment can be added
to others' in the same way that conventional CBA adds vertically
various citizens' willingness to pay for an environmental
improvement. (Harberger 1983 : 112)
The willingness of individuals to pay to achieve specific
homeless assistance goal targets can be estimated by the financial
response and contributions from the various public, private, and
non-profit homeless assistance providers. The basic needs
approach is an attempt to ascertain the attitudes and views of the
members of a society. Surveys and polling techniques can be used
to estimate these social welfare views and attitudes. Benefits can
also be measured by totalling individuals' willingness to pay for
public investments such as homeless assistance. These are
summed and if they exceed the costs of such an investment, it is
presumed the investment is a beneficial or efficient one. If a
society's willingness to pay for homeless assistance programs
exceeds the costs for such efforts, investments in these programs
are deemed not only efficient but equitable from a communitys or
society's perspective. It is presumed there is an equitable transfer
of resources to those less fortunate (homeless) from those better


25
off. As described above, direct homeless assistance benefits are and
will be realized by the homeless and others in the homeless
community. Indirect benefits are experienced by those who
surround this community. As more is understood about the direct
and indirect benefits of successful homeless assistance programs,
the homeless community and the community's (public)-at-large's
willingness to pay for these activities can be maximized. Even
though there may be a greater willingness to pay for homeless
assistance than the costs to support such activities, the distribution
of benefits generated by successfully reaching homeless assistance
goals may warrant examination in the social impact analysis. This
examination can include the entities who receive these benefits and
any redistribution or equity concerns. The social impact analysis
also should include a suggested funding plan that equitably assigns
costs to the appropriate level of government, private, or non-profit
resource.
Sensitivity Testing
Estimated benefits and costs generated from homeless
assistance activities should be evaluated in the following manner.
The present value of net benefits accrued from reaching one of the
homeless assistance goal targets is calculated by subtracting the
present value of total costs from the present value of the total
benefits. The net present benefit measures the net gain to society
from undertaking the particular activity. Alternatively, a cost-
benefit ratio can be calculated by dividing the present value of total


26
benefits by the present value of total costs. Such ratios facilitate
comparison of alternative homeless assistance activities.
A CBA analyst must develop a benchmark estimate of net
present benefits comprised of the most reasonable, agreed upon,
and accepted set of key assumptions which underlie the CBA
analysis for each goal target. The benchmark estimate will include
cost, benefit, negative direct or indirect effect, and time analysis
factor assumptions. Additional net present benefit estimates must
be developed based on changes in these key assumptions. For
example, components of time analysis can be adjusted to produce
different benefit and cost results.
Sensitivity tests, review the major assumptions and their
rationale and assess the sensitivity of the findings to changes in
those assumptions. ...Through this process of examining the
sensitivity of the benefit-cost findings to changes in the major
assumptions and estimates, an assessment of whether net
present value is positive can be made with far greater certainty
than would be possible under a single net present value estimate.
(Thornton 1982 : 156-158)
Costs that support homeless assistance efforts emanate from a
variety of public, private, and non-profit sector sources, including
some outside of Denver. Benefits generated from reaching
homeless assistance goals also are received by homeless persons,
firms, and residents (taxpayers) beyond the City and County of
Denver. In many cases there will not be a direct transfer of costs
and benefits within the City and County of Denver. It is expected
this CBA will identify significant costs and benefits external to
Denver. As a result of this and the fact homelessness in Denver
relates to national causes and solutions, the benchmark estimate
should include private (Denver) costs and benefits as well as


27
external costs and benefits. Finally net present benefit estimates or
cost-benefit ratios can be evaluated or compared between different
goal targets relating to different primary homeless assistance
goalsemergency service, transitional, and preventive homeless
assistance or between different goal targets within one of these
goals.
Homeless Assistance CBA Framework
A homeless assistance CBA must include the following eleven
framework components. It must:
1) Convert goals into an operationally measurable forms (goal
targets). The CBA analyst will require guidance from the public,
private, and non-profit sector CBA participants and sponsors.
2) Identify the benefits in money or incommeasurable terms.
3) Consider the intangible benefits for each of the primary
homeless assistance goal targets.
4) Determine the homeless community boundaries. This will
help define the direct and indirect homeless assistance benefits.
5) Consider whether there are any negative direct or
indirect effects of homeless assistance efforts.
6) Review the costs for the homeless assistance programs or
goal target options necessary to achieve the primary goal targets.
These costs reflect the specific program costs necessary to reach
the various goal target options. Opportunity costs also must be
included in the analysis. In effect, a cost-effectiveness analysis is
performed with this exercise.


28
7) Develop a benchmark estimate or ratio for each goal target
and describe the key assumptions which underlie the estimate and
ratio.
8) Perform sensitivity tests based on changes in these key
assumptions.
9) Compare the net present benefit estimates or cost-benefit
ratios, for alternative projects, including the benchmark and
sensitivity testing estimates and ratios, to present public policy
guidance and flexibility.
10) Consider and review other homeless assistance
assumptions, considerations, and other human service program
information, etc., that is not part of the quantitative analysis, but of
which any researcher must be aware to fully understand and
appreciate the final CBA results.
11) Perform a social impact analysis focusing on the
distribution of homeless assistance costs and benefits and current
and potential homeless assistance funding sources to develop the
most equitable homeless assistance funding plan. Better knowledge
of the sources and causes of Denver's homeless population will help
with this analysis and the development of this plan.
Chapters IV, V, and VI examine additional homeless
assistance framework components. Chapter IV reviews and
considers the benefits of reaching goal targets within each of the
three primary homeless assistance goals but does not precisely
quantify or measure them. Included with this benefit consideration
is a review of the criteria for the homeless community boundary.
The fundamental cost considerations involved in implementing


29
specific programs within each of the primary homeless assistance
goals are documented in Chapter V. A listing of other pertinent
homeless assistance CBA considerations, particularly political and
administrative considerations, follows the benefit and cost
chapters. Chapter VI also elucidates the assignments involved in
performing the homeless assistance CBA's social impact analysis.
Homeless assistance framework components 1, 5, 7, 8, and 9 will
not be focused upon for the remainder of the thesis. These
components must be addressed with the aid of CBA financial
supporters and public-policy leaders, or can only be fulfilled once
the costs and benefits are determined. These components are also
fundamentally dependent on actual situations and conditions at the
time of the CBA analysis.


CHAPTER IV
BENEFIT CONSIDERATIONS
In order to apply the homeless assistance CBA framework, an
economist or other social scientist must examine the dimension of
homeless problems according to the three primary homeless
assistance goals4 emergency service, transitional, and preventive
assistance. Within these goals, the various subpopulations which
are afflicted with homelessness must also be examined to
determine their special conditions which will affect the CBA
analysis. The next three chapters undertake such an examination
of the benefit and cost considerations on the basis of the
dimensions and conditions which presently exist in the Denver
region. Research which documents the examination represents the
best available information to study these dimensions and conditions
in the region. These chapters represent an information and
research review base for economists and social scientists
performing a homeless assistance CBA.
4 The term goal target is now eliminated. It is assumed that the primary
homeless assistance goals will be converted into operationally measurable
forms.


3 1
Dimensions and Conditions of Denver's Homeless Problems and
Population
The first chapter of this thesis briefly reviewed the causes of
the new homeless in America. These major causes include
deteriorating economic conditions for low-income Americans,
shifts in social welfare policy (including significant cutbacks in
federal and other governmental housing and other public
assistance), and the decline of the intact and extended family. New
federal public housing authorizations have declined from $23.7
million in 1980 to $4.7 million in 1985. (Weicher 1984)
Deteriorating economic conditions refers to dwindling employment
opportunities for near poor and working poor citizens. For
example, the national average annual unemployment rate between
1978-1987 was 7.2%. This compares to a national average annual
unemployment rate of 5.6% for the ten year period 1968-1977.
(Sprinkel 1988) It also refers to poor persons who are victims of
unexpected personal and financial disasters which propel them
into the condition of homelessness. Two additional causes which
predate the rise of the new homeless but which add to this new
homeless population include the deinstitutionalization of
chronically mentally ill persons and alcohol and drug abuse. Street
people constitute another component of the homeless population
which is not part of the "new homeless." "Street people are those
eccentric and bizarre people who have made the streets their home
and have developed an idiosyncratic adjustment to that
environment." (Breakley 1987 : 42)


32
Overview of Denver's Homeless Population
Before a homeless assistance CBA and other social planning
around homelessness occurs, the analyst must familiarize himself
with an understanding of homelessness, its causes, and its peculiar
local manifestations. This education should produce an
understanding that the homeless population is not homogeneous.
A good understanding of the homeless phenomenon entails
understanding the various subgroups among the homeless. Each
subgroup has some unique needs while sharing the one need of a
place to live. The chronically mentally ill for example, present
many challenges that the (new poor) homeless do not: they may
have never worked before, may never work. (Jones 1987 : 19-
20)
Further, in addition to the stereotypical single-male "hobo,"
there are six distinct homeless subpopulations: families, youth,
elderly, women, chronically mentally ill, and substance abusers.
Homeless assistance providers estimate that families with
children now represent over 30 percent of Colorado's homeless
population. (Gould 1987) Estimates of the number of homeless
runaway/throwaway youth who live in the Denver region range from
150 to 500. (Jones 1987) It is estimated that between 10 to 22
percent of the total homeless population seen in existing programs
in Denver are age 55+. In actual numbers, this converts to 250 to
350 older persons. (Jones 1986) Mendelson and Young predict
there are 1425 homeless substance abusers in the Denver region.
(Jones 1987) Finally, staff from Denver General Hospital and the
University of Denver conclude there is a 30 percent rate of mental
illness in the shelter population. (Sachs-Ericsson, et. al. 1987)
The Stout St. Clinic, which provides community medical services to


33
Denver's homeless through the Health Care for the Homeless
Project, reports that 68.3 percent of their clients are male and
31.7 percent of them are female. (Morrow-Jones and Van Vilet
1987)
A survey planned by the City and County of Denver, the
Colorado Coalition for the Homeless (CCH), and other community
group and academic professionals is expected to scientifically
estimate the number of homeless in Denver and Colorado. It is
expected to be completed by summer 1988 and may give the
Denver region better precision as to the numbers of homeless in
each of the principal subpopulations listed above. At that time, the
relative subpopulation estimates can be compared to a reliable total
homeless population figure to determine the more precise numbers
per subpopulation.
Economic Rehabilitation versus Custodial Care
In general, the homeless can be classified into two groups
those who need short and long-term custodial care and those who
can be rehabilitated to a status of economic and hence social self-
sufficiency. For the homeless who require custodial care, service
requirements vary.
A sizable fraction of the homeless population...will continue to
be homeless unless they are given some kind of sheltered living
arrangement [custodial care]...for most, it implies a congregate
or other sheltered living arrangement, in the community,
combined with specialized supportive services. For some, it may
mean an independent, self-maintained residence with
continuous close monitoring by others. (Redbum and Buss 1986
: 133)


34
Homeless people in need of custodial care can include
members of any of the six homeless subpopulations. Homeless
persons who do not require custodial care possess the opportunity
to achieve economic and social rehabilitation. Custodial-care
programs can culminate in a transition to an economic
rehabilitation program for a previously homeless person.
Homeless Assistance Benefit Considerations
Benefits achievable from reaching each of the three primary
homeless assistance goals emergency service or shelter,
transitional, and preventive homeless assistanceare examined.
Certainly skilled applied economists and other analysts may suggest
benefits in money terms, incommensurable, and intangible benefits
in addition to the ones listed in the thesis. However, the following
benefits produced from homeless assistance goal achievement
represent perhaps the most significant. The public-good nature of
homeless assistance also presents a very fine line between benefits
in money terms and incommensurable benefits. Incommeasurable
benefits can be quantifiable in economic or noneconomic terms, but
can not be evaluated in money terms. The dividing rod used in this
thesis to separate benefits between these two categories is the
quantification in money terms. However, many benefits expressed
in money terms (e.g., reduced public health system costs) can also
be perceived as incommeasurable, i.e., improved health of a certain
number of homeless persons. A plethora of intangible benefits also
exist. A good analyst can develop and justify these to the level the
CBA analysis requires.


35
Emergency Service Goal Benefit Considerations
Reaching emergency service homeless assistance goals
generates significant benefits for society. There is no doubt that
emergency homeless shelter can save lives. Emergency shelters
are particularly beneficial for victims of exposure (hypothermia) and
fires. Saved lives here are incommeasurable benefits as well as
intangible. Another intangible benefit from achieving emergency
service goals is the psychological benefit for the homeless of
reaching a "safe haven". Even though the best emergency homeless
shelters can be congested and noisy, they at least offer an
opportunity to collect thoughts, make phone calls, arrange for
transitional and other support services, etc.
For the most part, homeless individuals are law-abiding
citizens, but some are crime-prone and antisocial. Their ragged
appearance may offend other citizens, businesses, and tourists.
Listed in Appendix C are services, facilities, and places homeless
utilize or frequent. Some of these locations are places where the
homeless person's presence is expected, e.g., food banks, social
service offices, alcohol abuse facilities, etc. However, train and bus
stations and truck stops represent locations where homeless
persons' congregating can produce a negative effect by making
these places of business less safe or less attractive. Homeless
roaming the streets or holing up in abandoned buildings make a
respectable neighborhood less attractive. Sufficient emergency
shelter would reduce this "homeless congregation" at inappropriate
locations. Providing sufficient emergency shelter for homeless is


36
likely to stem the wandering of the homeless and may produce
benefits measurable in money terms, e.g., increased tourism or
business in the affected location and reduced sanitary, insurance,
and security costs for these businesses. It is also likely to make it
easier for businesses in the homeless community to secure vital
loans. Land values in residential areas near where homeless
congregate would be protected or embellished if sufficient
emergency shelters are provided. Incommeasurable benefits would
include the preservation of attractive tourist (Curtis Park), business,
and residential areas, as well as less business disruption from
inappropriate homeless congregation.
Adequate emergency shelter for homeless persons also
benefits society by reducing use of the public health and hospitals
system and processing through the criminal justice system. When
homeless persons gather in inappropriate places, criminal activity
can result. Adequate emergency shelter may reduce criminal
activity and produce benefits in money terms by lowering criminal
justice system costs. These lower costs pertain to the resources
saved by the police, courts, and corrections systems because they
do not have to investigate, arrest, prosecute, judge, sentence, or
incarcerate as many of the homeless. The reduced costs of
personal injury and property damage from less crime are also
benefits in money terms. Less crime also means less theft and
benefits in money terms are generated by the decrease in the costs
of fencing, and in less damage to the stolen property. An
incommeasurable benefit of reduced criminal activity is less wasted
or inappropriate jail time. (Thornton 1982) For example, even


37
though some homeless persons may commit crimes (e.g., vagrancy,
disturbing the peace, trespassing, etc.) simply as a result of being
homeless and not having shelter, their destitute status may lead to
incarceration. This makes scarce jail space unavailable for
incarceration of chronic law-breakers. There is also evidence that
many of the homeless in jails are mentally ill and are in jail as a
result of their mental illness. (Barrett 1986) These people have
great need for mental health servicesboth emergency level
services and ongoing services. Adequate emergency shelter offers
the homeless mentally ill a better prospect of eventually securing
mental health services than does a jail setting which may in fact
exacerbate mental illness. It also will preserve the criminal justice
system for criminals not requiring mental health services. An
intangible benefit of reduced criminal activity from sufficient
emergency shelter is a reduction in the psychological costs of
crime to its victims. (Thornton 1982)
If there is sufficient emergency shelter, homeless persons are
less vulnerable to disease, sickness, and exposure. This is
important since the homeless population is in poorer physical
health than the general population. (Ropers and Boyer 1987)
"Recent studies have shown that between 2 percent and 7 percent
of the homeless have tuberculosis, a rate anywhere from 150 to 300
times higher than the national average," according to the National
Centers for Disease Control. (The Denver Post May 8, 1987)
Adequate emergency shelter may prevent further physical health
deterioration for the homeless person and reduce public health


38
system costs. The following services are offered homeless persons
by the Denver Department of Health and Hospitals.
1) Emergency services.
2) Ambulatory services.
3) Hospitalization.
4) Referral for shelter, food, clothing.
5) When client apparently eligible, referral for assistance
from categorical or other programs at the Denver Department of
Social Services.
6) When client apparently eligible, assistance in referral to
Social Security.
7) When client apparently eligible, discharge planning
assistance when specialized services such as boarding home or
rehabilitation services needed (when patient eligible).
8) Referral to appropriate community mental health team
and service.
9) Health and Hospitals responsible for medical staffing at
Stout Street Clinic. That Clinic provides ambulatory care.
Makes referrals to Health and Hospitals for specialized
treatment, hospitalization, specialized tests. Provides medical
coverage for persons in respite beds at Samaritan Shelter.
10) Clinical Social Work services available in all facilities of
Health and Hospitals except Denver CARES to provide
counseling or assistance in referrals.
11) Social Services Technicians available at Denver General
Hospital and in the Neighborhood Health Program to initiate the
application process for categorical assistance or Medicaid.
(Collins 1987)
Sufficient emergency shelter would reduce service costs by
the Denver Department of Health and Hospitals to the homeless
population in services 1 to 6 above. In Colorado, the average charge
per day, per person in a general hospital was $844.00 according to
a study by Equicor, a joint venture of the Hospital Corporation of


39
America and the Equitable Group. (The Denver Post January 6,
1988)
Reduced public health system costs represent benefits in
money terms. Incommensurable benefits are similar to those
generated from reduced criminal justice system activity. Sufficient
emergency shelter should prevent use of the public health system
by homeless persons and reserve it for those with unpreventable
physical maladies. A substantial incommensurable benefit realized
from sufficient emergency shelter is a healthier population.
Additional benefits measured in money terms can be realized
when emergency shelter goals are met, which prevents more costly
emergency service solutions. For example, the Reverend William
Kraus, Samaritan House of Denver shelter director, says it costs
about $6.50 to $7.00 a day per person for shelter services. The
annual operating costs for this shelter, which was the nation's first
to be designed and built strictly for work with the homeless, are
about $600,000.00. (The Denver Post January 30, 1987; Rocky
Mountain News November 26, 1987) A comparison of these costs
to those of other emergency service alternatives reveals regular
overnight shelter facilities may be the least expensive option. For
instance, when regular emergency shelter space falls short, the City
and County of Denver resorts to a hotel voucher program. The
vouchers range from $16.00 to $20.00 per night per homeless
person. (The Denver Post January 10, 1987)
A final incommeasurable benefit realized when emergency
service goals are reached is political gains. If Denver or other
metropolitan areas meet emergency service or shelter goals,


40
significant political problems are eliminated from neighborhood,
community, and religious groups. A municipal government's
political capital can be preserved for other thorny metropolitan
issues.
The overriding intangible benefit of attaining emergency
service goals is fulfilling the fundamental moral obligation of
sufficiently assisting a homeless population which perhaps
experiences some of the greatest psychological and physical pain of
any members of society. This moral obligation has historically
driven the public, private, and non-profit sectors to assist the
homeless with emergency service.
Transitional Homeless Assistance Benefit Considerations
Transitional homeless assistance involves providing a stable
living environment for a period longer than thirty days but usually
no more than two years. Transitional homeless assistance can be
geared to securing a longer-term, custodial care environment for
previously homeless persons, or it can focus on economic and social
rehabilitation.
The psychological, political, public health and criminal justice
systems, and homeless-congregation-related benefits generated
through fulfillment of transitional homeless assistance goals would
be similar to those obtained by achieving emergency service goals,
if homeless persons are able to successfully make the conversion to
transitional homeless assistance. Unique benefit categories found
by achieving transitional homeless assistance goals include those


41
garnered from transitional custodial care and transitional economic
rehabilitation.
The benefits in money terms from transitional rehabilitative
homeless assistance are significant. If a previously homeless person
enters a transitional program and eventually secures gainful
employment as a direct result of the program, the present value of
his or her earnings are benefits in money terms. If through
successful rehabilitation efforts, individuals are liberated from
substance abuse, mental illness, or other custodial care programs,
the resultant reduced program costs are significant benefits in
money terms. (Thornton 1982)
Incommensurable benefits achieved through transitional
custodial and rehabilitative homeless assistance goal fulfillment are
higher education or functional level for program participants,
better health for these homeless clients, and life preservation.
Successful transitional homeless assistance programs produce an
improvement in a homeless person's general lifetime ability to
function as an economic producer. This can be charted through an
increase in the marginal productivity of labor and an increase in
non-market productivity. Participants in these transitional
programs usually receive significant investments in human capital
(education) which is expected to enhance the present value of
future productivity. Successful transitional programs increase the
consumer decision making efficiency of program participants.
(Weisbrod 1983) A noteworthy intangible benefit realized from
reaching transitional custodial or rehabilitative homeless assistance
goals is the psychological benefit of nondependence for those who


have achieved self-sufficiency. The overriding moral concern of
helping the suffering homeless population continues as an
intangible benefit when transitional homeless assistance goals are
reached.
Preventive Homeless Assistance Benefit Considerations
As with emergency service and transitional homeless
assistance, preventive homeless assistance produces benefits
through psychological stability to homeless assistance beneficiaries,
political benefits to local government leaders, benefits from
reduced use of the public health and criminal justice systems, and
benefits from reduced undesirable homeless congregation. In
totalling preventive homeless assistance benefits, it is assumed that
individuals or families who are recipients of preventive programs
are economically self-sufficient and employed or at least in a
position of stability by virtue of being enrolled in a variety of public
assistance or welfare programs. Preventive homeless assistance
programs which reach preventive homeless assistance goals and
prevent persons who are currently socially and economically self-
sufficient (or who stand the best chance of escaping public
assistance and becoming self-sufficient) from becoming homeless
will yield the greatest benefits in money terms. The emphasis is
on continuing or initiating the earned income and/or output of
these self-sufficient persons.
The primary incommeasurable benefit from successful
preventive homeless assistance programs is the preservation of the
physical and mental health of potentially homeless people.


Significant intangible benefits from these programs include
preservation of individual self-esteem and peace of mind. The
moral concern of helping persons and families on the brink of
homelessness is again perhaps the greatest intangible benefit of
attaining preventive homeless assistance goals. Additionally,
successful preventive homeless assistance programs can be
credited with the benefits realized from eliminating the need for
emergency and transitional homeless programs.
Preventive homeless assistance programs can either focus on
primary prevention or secondary prevention. Primary prevention
programs are those applied to the most vulnerable homeless
populations before they become homeless. They are broad in
application and have the effect of bolstering an individual's or
family's ability to advance to or maintain economic and social self-
sufficiency. Program examples would include rent subsidies, low-
income/low-cost housing, and financial budget counseling. Sanjek
recommends the following comprehensive list of primary
prevention homeless assistance programs:
1. Preservation of rent control. Federal policy to deny funds
to localities with rent controls will increase, not prevent,
homelessness.
2. A moratorium on or, at least, increased tenant protection
in the face of cooperative and condominium conversions.
3. Housing production programs and/or mortgage subsidy
efforts for new or rehabilitated low-and moderate-rent housing.
4. Policies that prevent landlord abandonment of buildings.
Federal regulations could encourage localities to formulate such
programs.
5. Preservation of single room occupancy housing [SRO]
through tax incentives and direct subsidies.


44
6. Tax policy reversing the trend of a decreasing proportion
of taxes paid by business. The present policy shifts the burden
of higher property taxes to home owners, and makes it difficult
for low-income home owners to maintain and stay in their
homes.
7. National credit allocation policy ensuring a percentage of
available credit to housing needs, at affordable interest rates.
(Sanjek 1986 : 319-320)
In fact, any program which enhances the ability of the
working poor (or persons on welfare) to remain self-sufficient can
be given credit for contributing to the prevention of homelessness.
The problem with totalling benefits from primary preventive
homeless assistance programs is that it is difficult if not impossible
to determine if the primary prevention programs actually do
prevent homelessness. "That is why, in the near term, therefore,
the strategies likely to be cost-effective in reducing the incidence
of homelessness are those that offer secondary prevention, that is,
interventions that occur at or soon after the time when a person or
family loses a home." (Redbum and Buss 1986 : 127) Secondary
prevention programs are applied to situations where homelessness
is imminent. Examples of these programs include emergency rent
subsidy programs, foreclosure prevention programs, and eviction
assistance efforts. Preventive homeless assistance programs,
whether primary or secondary, emphasize housing needs as
opposed to other economic needs.
Homeless Community Boundary Considerations
Defining the "homeless community" boundary is an essential
exercise for the homeless assistance CBA analyst. This boundary


45
will help determine who receives direct and indirect benefits from
the achievement of homeless assistance goals.
Obviously, the homeless community will include the area
where emergency and transitional shelters are located. Hiawatha
Davis, City Councilman for Council District #8, City and County of
Denver, has said that 90 percent of the city's homeless shelters are
in his northeast Denver district, and in the Five Points, Cole, and
North Capitol Hill neighborhoods. (Rocky Mountain News August
19, 1985) Transitional facilities are more dispersed. "Districts
#1,8, and 9 each house over 600 beds for the needy, while District
# 7 contains a mere thirty-eight beds, and District # 5, forty-six
beds. District # 6 has 100 beds and District #4, 213 beds."
[Washington Park Profile June, 1987)
In order to determine the homeless community boundary,
however, it also is important to pinpoint where the homeless
congregate. Businesses and neighborhood leaders can document
the negative effects homeless persons have in their areas. Earlier
in this chapter it was stated that the negative effects homeless
congregation produces on businesses and residential areas could be
mitigated with sufficient levels of emergency and transitional
facilities and services. Mitigation is the key word. Adequate
emergency shelter and transitional facilities and services for
homeless will not eliminate congregations of the homeless. The
homeless population is mobile and must move about to secure the
necessary services for support and/or rehabilitation. Adequate
homeless assistance facilities and services and cooperation among
businesses, residents, and homeless persons can preserve the


46
attractiveness and economic vitality of areas with homeless
facilities. People can learn to live with one another. However,
despite these efforts, a homeless community "stigma" can still
result.
A final consideration in developing a Denver homeless
community boundary is to track the source of financial support
from the public, private, and non-profit sectors which back
homeless assistance efforts. It appears the bulk of this financial
support comes from Denver city government and Denver
foundations, churches, and nonprofit institutions. Another
significant financial backer is the federal government with the
passage of the Stewart McKinney Homeless Assistance Act.
(Allocated to Colorado was $2,212,000.00; the lions share was
directed to Denver.)
Clearly, Council District # 8 could be considered the city's
and the metro region's hard-core homeless community. Several
other Council Districts are also significantly affected. Yet, since
Denver's economic health partially depends on the vitality of these
Districts and the fact that the predominant financial support to
solve homeless problems emanates from Denver's government,
churches, foundations, and nonprofit institutions, the homeless
community should be considered the City and County of Denver.
Populations which may be considered indirect beneficiaries of
successful Denver homeless assistance activities include the rest of
metro Denver and other municipalities in Colorado. These areas
indirectly benefit when the City and County of Denver's economic
vitality is bolstered. These locations should also absorb less


homeless migration if Denver's homeless facilities and services are
sufficient. The nation's taxpayers who have contributed to the
Stewart McKinney Act and other federal homeless assistance aid
could be considered indirect beneficiaries; yet, the impact of
reduced federal homeless assistance funding as a result of
permanent homeless solutions in Denver would be minimal.


CHAPTER V
COST CONSIDERATIONS
This chapter identifies fundamental cost considerations for
each of the three primary homeless assistance goals emergency
service, transitional, and preventive assistance. These cost
considerations include those which should be considered for
virtually all specific programs necessary to reach the homeless
assistance goals. The prospect of successful homeless assistance
programs increases if there is a continuum of services which
connect emergency service, transitional, and preventive homeless
assistance into one process so that homeless individuals do not fall
through the crack.
If shelter, income [from public benefit programs], and food
provide the necessary ingredients of an emergency response,
housing assistance, supportive services, and employment
assistance provide the second phase response. Taken together
they can lead a person to the third phase: permanent housing,
employment, and/or adequate income and supportive services.
What is important is that different people use different services.
(Kaufman 1986, : 342)
Kaufman aptly describes the three service phases necessary
to fulfill emergency service and transitional homeless assistance
goals. However, the continuum of services is not complete unless
preventive homeless assistance is included. "Solutions will only be
successful if they attack the root causes of homelessness which
include inadequate income [employment], inadequate housing, and


inadequate social and mental health services." (Kaufman 1986 :
339-340) Within this continuum of services there are distinct cost
considerations for each homeless assistance goal.
Emergency Service Cost Considerations
The principal emergency service cost categories include four
viable emergency shelter supply options. The most common
strategy for housing the homeless is the conversion of existing
buildings or dwellings to emergency facilities. The second
alternative is factory construction of portable emergency housing.
{...cost [between these two options] depends upon the
availability of public buildings that can be had at no cost, the
availability of public land, the cost of existing buildings, the cost
of privately held land, and the cost of renovating existing
buildings. Absent the existence of a free building, or of a
privately held building that can be bought at low cost and which
requires minor renovation, factory-built housing will be more
cost-effective. But with a free public building that requires little
earthquake reinforcement, conversion is more cost effective.
(Callahan, et. al., 1986 : 372-374)}
The third emergency shelter supply option is construction of
a new large shelter facility. Denver's Samaritan House, the nation's
first designed and built strictly for work with the homeless, cost
$6.17 million to build. It has 122 beds for men, 48 for women, and
80 beds in its 20-room complex for families. (Rocky Mountain
News November 26, 1987) The Rev. William Kraus, Samaritan
House director, said it will cost about $600,000 a year to run the
shelter, which comes to about $6.50 to $7.00 per person per day.
[The Denver Post January 30, 1987)
New construction is the least cost-effective emergency
shelter supply option. Why did the Catholic Archdiocese build


50
Samaritan House? Is a brand-new facility more cost-effective than
the other three options in the long run? Or, perhaps the
Archdiocese is so committed to helping the homeless, it wanted to
institutionalize its service commitment through the construction of
this new facility. The short-term cost-ineffectiveness of new
emergency shelter facilities can be seen with a comparison to the
York St. emergency shelter facility in northeast Denver. This
shelter is managed by the Volunteers of America to whom The City
and County of Denver leases the shelter building at no cost. The
renovation costs for this 150-bed emergency shelter totalled.
$175,000. (Jones 1987)
The fourth emergency shelter supply option may be the most
cost-effective because there is no renovation or construction
involved. This emergency overflow service involves two downtown
churches opening their basements to accommodate up to fifty men
overnight at each church. It is a no-frills service, which offers
emergency shelter when the regular emergency shelters are full.
Other emergency service support such as provision of laundry
facilities is not offered and the homeless are expected to find this
support elsewhere. The cost for fifty vinyl-covered mats which
serve as beds for the homeless at the churches was $1500.00. (The
Denver Post January 10,1987) Maintenance costs for these
overflow facilities include toiletries, cleaning, utilities, and two
meals per day. This totals about $180.00 per night for fifty persons.


Staff support to run each of these shelters is no more than
$30,000.00 to $40,000.00 per year.5
This emergency overflow service is not a blanket solution and
usually applies only to overflow or extreme emergency situations.
However, it is a viable option which should be compared to the
other three emergency shelter supply options if there is a need to
expand emergency shelter beyond that already supplied by the
other supply options. Churches have been good locations for these
overflow facilities because of different faiths' concern for the
homeless. Many are located in the homeless community and many
have large areas such as basements which act as the bedding area.
Appendix D lists clothing, personal, and miscellaneous needs
for persons in emergency shelters. It does not list food, which can
be supplied at the emergency shelter or by a separate soup kitchen
or food bank. Cafeteria-style meals for homeless persons can cost
as low as $1.50 per person.6 Other costs to run an emergency
shelter include: cleaning, maintenance, facility repair, utilities,
insurance, staff and other administrative costs, and furnishings
(unless these are donated). Laundry services are considered an
option.
A final emergency shelter cost consideration centers on the
public assistance programs which can enable the homeless to gain a
5 Cost information on the emergency overflow service comes from Ms.
Christine Hager, director of the Central Presbyterian Overflow Shelter in
downtown Denver.
6 This information was obtained through a conversation with Harry Ilg,
director of the West Hotel in downtown Denver. Mr. Ilg plans a SRO facility
at the 11th Ave. Hotel in the downtown area. This facility will have a
kitchen which can prepare inexpensive meals for homeless and working
poor persons.


52
more stable foothold and break the cycle of homelessness. Many
homeless individuals and families may not receive benefits from
these public programs while in emergency shelters but they may
apply for them during this emergency service phase. Direct
financial or in-kind assistance from these public assistance
programs can help assist homeless persons through the emergency
shelter experience as well as during transitional programs.
Financial assistance programs for the homeless can include Aid to
Families with Dependent Children, County General Assistance,
Veterans Assistance, Unemployment Insurance, Worker's
Compensation, Social Security, and Supplemental Security Income.
Principal in-kind assistance programs for the homeless are food
stamps, Medicaid-Medicare, and public housing. The Denver
Department of Social Services estimates 40 percent of the city's
homeless are eligible for some form of public assistance.
Homeless solutions can potentially involve virtually every
public assistance, income maintenance, and other available human
service program. If these efforts are not cost-effective, homeless
assistance strategies which depend on them will be harder pressed
to be efficient. A homeless assistance CBA relies in part on an
evaluation of the cost-benefit and overall effectiveness of these
human service programs. For example, Reeder (1985) has
discovered Section 8 existing housing achieves the same goals as
the "new construction" public housing programs but with greater
flexibility and at lower cost.


Transitional Homeless Assistance Cost Considerations
Transitional homeless assistance facilities can either be a
program component within an emergency shelter or a separate
entity. For example, the Samaritan House shelter will extend
support up to ninety days, two months beyond the thirty-day
emergency service period, if homeless clients develop and keep to
a transitional "plan" through job-seeking, training, etc. Savings can
be realized and a continuum of homeless assistance services can be
achieved if emergency service and transitional assistance efforts
share administrative and other program support costs.
This review of transitional homeless assistance cost
considerations examines costs associated with separate transitional
programs and discusses them relative to the various homeless
subpopulations. Among the cost considerations are transitional
economic rehabilitation and transitional custodial care. The chapter
concludes with a generic review of homeless assistance cost
considerations that affect most specific transitional homeless
assistance programs and a brief review of preventive homeless
assistance cost considerations.
Families
An example of a transitional program which targets families is
Warren Village. This facility is a multi-service residential program
that helps low-income, single-parent families move from public
subsidy to economic self-sufficiency. The program offers intensive,
short-term support and help to parents to achieve financial


54
independence. Families participating in the program are able to
stay in the Village as long as twenty-four months. During this time
residents have safe, affordable housing for their families, access to
quality child care, and the assistance of counselors in setting and
achieving personal goals. (Hernandez 1987) Warren Village has
been recognized nationally as a model transitional economic
rehabilitation program. Its commitment to servicing homeless
families was recently bolstered by a Stewart McKinney transitional
homeless assistance grant. Service needs for families in transition
have been thus identified.
The order of service need...was child care, career counseling,
job training, employment, income, and education. Child care
was identified as a need among 77.6% of the sample. Career
counseling was a need for 61.5% while personal and parenting
counseling were each identified as a need for 56.1% of the
sample. Job related needs such as job training, entry level job,
and job improvement were identified as a need for 40.5%,
34.1% and 26.8% of the sample respectively. Education related
needs such as GED and college education were identified as a
need for only 17.1% and 10.7% of the sample. (Hernandez 1987
: Executive Summary)
Youth
Transitional homeless assistance directed at
runaway/throwaway youth must meet the needs of this
subpopulation.
Among the needs which go unmet or undermet are such
basics as coordinating outreach efforts to make
runaway/throwaway youth aware of services which are available,
community education and awareness programs, educational
programs for parents and youth alike, basic job skills training
and job placement services, and basic life skills (independent
living skills) training. (Jones 1986 : 2)


55
Urban Peak is a recently formed youth service facility
operating in Denver's Capitol Hill neighborhood. This non-profit
group offers outreach, referral, and counseling services.
Elderly
The service needs of the elderly homeless qualify them as a
distinct homeless subpopulation. Needs of this group identified by
the Homeless Action Group's (HAG) elderly sub-committee include:
Health care screening and services located at shelters,
outreach services, adult protection services, transportation to
existing service programs, supervision, case management, and
appropriate low-cost housing alternatives combined with service
packages.
Marine summarizes senior medical and health costs which
constitute perhaps this subpopulation's largest cost area.
Medical and health services for seniors are specialized and
they include ambulatory and primary care, geriatric assessment,
general hospital care, rehabilitation (hospital-based), dental
services, vision care, podiatric care, mental health services,
hospice care, Health Maintenance Organization (HMO) for those
over sixty-five, education about self-care, and prevention.
(Marine 1987 : 10)
Women
Transitional assistance cost considerations applicable to
single homeless women should include the need for privacy and
anonymity, the need for storage facilities, unique gender-related
needs, and the need to preserve or expand social relations and
social networks. (Koegel 1987) Single women also should receive
the specialized service required if they belong to one of the other
homeless subpopulations. However, there is a condition unique to
women which has caused society to develop separate transitional


56
homeless assistance facilities for them. This condition is the
battered woman. "Impetus for developing shelters for victims of
domestic violence has been generated by a growing awareness of
the cultural oppression of women, more empirical research on the
prevalence and causes of wife abuse, and the passage of domestic
violence legislation by an increasing number of states." (Stone
1986 : 299) Women who need shelter to escape domestic violence
are homeless, but not all homeless women need battered women
shelters. Battered women shelters act as a transitional service for
women who can rehabilitate economically and socially. In addition
to the costs for rehabilitative services, special counseling, security,
and medical costs must be included in maintaining a battered
women's shelter.
Transitional Economic Rehabilitation Cost
Considerations.
All homeless persons in transitional assistance programs are
either in need of longer-term custodial care or can be
economically rehabilitated. This rehabilitation means finding a
permanent job with pay sufficient to maintain a self-supporting
lifestyle. There is a need for a continuum of employment services
for the economically disadvantaged homeless. These services, as
identified by the HAG Economically Disadvantaged Subcommittee
include pre-employment counseling, job readiness, job
training/retraining, job search, job development, and on-the-job
training. In addition, it is important that the homeless have access
to a variety of job opportunities and necessary support services such


57
as public transportation and child-care to keep jobs once they are
found.
There are at least three Denver-based programs which now
offer employment assistance to homeless persons. One provides a
special team through the Denver Employment and Training
Administration (DETA). The team consists of a job developer and
employment counselor/case manager who work with the shelters
in securing employment for the homeless. The job developer
negotiates with prospective employers and identifies employment
opportunities. The employment counselor/case manager work
directly with clients and assists them with pre-employment
counseling, skills assessment, job readiness counseling and
supportive services, as well as job referral and placement. Labor's
Community Agency, an arm of the Colorado AFL-CIO, also helps
homeless people secure gainful employment.
Another special local homeless economic rehabilitation
program is the Osage Initiatives Project. Osage Initiatives is a
unique, collaborative approach of area businesses, government, and
community agencies to develop a one-stop employability and
employment center for Denver's homeless population. Its primary
purpose is to provide adequate and meaningful job opportunities to
the homeless and potentially homeless.
Osage Initiatives includes two basic components
employability services, including literacy and basic education,
housing counseling, employability skills, and job training and
development through the existing non-profit organizations
involved; and on-site employment through the development of new


58
businesses located at Osage. (Osage, 1987) The Osage Project is a
comprehensive approach which uses the expertise and skills of
existing non-profit agencies instead of requiring new and expensive
government programs. The Osage Project's costs include the
operating expenses of these agencies plus the renovation and other
costs of the Osage facility (which coordinates the services of these
agencies) at 1175 Osage St., Denver. Renovation and other Osage
start-up costs were $3,745,000. Building maintenance costs come
from agency rental payments. (Osage 1987)
Transitional Custodial Care Cost
Considerations.
Homeless persons who are victims of substance abuse and/or
are chronically mentally ill require special custodial care. This
transitional custodial care can lead to a long-term custodial care
status or culminate in participation for homeless persons in
economic rehabilitation transitional programs. Even though many
homeless persons suffer from mental illness and substance abuse
maladies, the professional response from mental health and
substance abuse experts has historically not been coordinated.
Transitional Custodial Care for Homeless Alcoholics/Drug Abusers.
Substance abusers are persons who have alcohol and/or drug
dependencies. Transitional custodial care for homeless
alcoholics/drug abusers is focused principally on their physical
health. Homeless substance abusers who are alcoholics require
special custodial care.


59
The alcohol-abusing homeless are simply much sicker, on the
average, than the nonabusing homeless. Compared with the
nonabusers of either gender, abusers are four to seven times as
likely to suffer from liver disease, twice as likely to suffer serious
traumas, two to three times as likely to be disabled by seizure
disorders or other neurological impairments, and also twice as
likely to be present with various nutritional deficiencies
(predominantly malnutrition and dehydration)...liver disease
among this population is, for all practical purposes, restricted to
the alcohol-abusing subgroup. Other disorders that are at least
50 percent more common among the alcohol abusers than
among the others include hypertension, chronic obstructive
pulmonary disease, gastrointestinal disorders, and arterial
disease...Not only are homeless alcoholics homeless and
alcoholic a circumstance that is bad enough but they also are
disproportionately drug abusive, psychiatrically impaired, and
physically ill...Health service costs for the homeless substance
abuser include detoxification or dry-out programs. Many of the
homeless alcoholics are likely to be detoxified dozens, if not
hundreds, of times at enormous societal expense. (Wright et. al.
1987 : 23-27)
The City and County of Denver operates two acute care/detox
facilities. The first, Denver CARES (Comprehensive Alcoholism
Rehabilitation and Evaluation Services) is non-hospital based and
has a 197-bed capacity. The second acute care program is a
dedicated unit of Denver General Hospital.
Transitional custodial care for homeless mentallv-ill persons.
Chronically mentally ill are those whose mental illness interferes
with their capacity to maintain economic self sufficiency and to
function socially. Casualties of deinstitutionalization, many have
fallen through the cracks of the community mental health system.
Deinstitutionalization without community support and adequate
housing for mentally ill persons has contributed to the problems of
homelessness in America and Colorado, but this is not the only
concern.


60
Although studies demonstrate that there are mentally ill
individuals among the homeless, not all (or even most) of the
homeless are chronically mentally ill. Those who are mentally ill
focus on their housing and welfare needs rather than on mental
health treatment needs. Do the homeless mentally ill need
more mental health treatment or a return to the asylum, as some
have suggested? Or is the problem more fundamental, a lack of
adequate community-based housing, jobs, and other services?
(Goldman and Morrissey 1985 : 729)
Goldman and Morrissey pose interesting questions. Is the
key to successful transitional custodial care for homeless mentally
ill to provide both mental health treatment and other necessary
support services? It appears so.
Homeless mentally ill persons, who have traditionally been
underserved, present a variety of problems requiring a broad
range of services. Their needs include emergency food, shelter
and clothing, opportunities for positive social interaction,
mental health services, health care, rehabilitative services,
income support, individual assistance in accessing needed
services, and permanent housing with supportive services. The
special needs of this population have also required the
development of new approaches to service delivery and the
creation of new alliances among policy makers and service
providers. (Reyes 1987 : 3)
Despite this range of needs, mental health services deserve
special focus. The challenge for service providers will be to devise
community programs that address the multiple problems of the
mentally ill homeless and that are more acceptable to them than
traditional mental health services. Wilson succinctly describes the
current mental health service system in Denver.
The mental health system in Denver consists of four private,
nonprofit community mental health centers, Citywide Services,
Denver General Hospital, two clinics serving the special needs of
ethnic minorities, and other clinics operated by churches or
other non-governmental entities such as the Colorado Coalition
for the Homeless. Each of the four community mental health
centers in Denver provide a comprehensive array of services to
the community and all have special programs for the chronically
mentally-ill individuals. These special programs include partial-


61
day care, outpatient, and residential services. These programs
provide social and vocational rehabilitation, protection and
advocacy, income support and entitlements, medication
prescription and monitoring, supportive counseling, and
psychotherapeutic individual or group sessions. Case
management services are provided which supplement and then
replace those originally provided by the Citywide case
management team. The inpatient services at Denver General
Hospital are oriented toward the acute episode with the major
focus being symptom reduction and stabilization. Upon
admission, each client is assigned to a Citywide case manager
and/or to one of the mental health centers so that joint
discharge planning can begin immediately. Long term inpatient
care is provided by Fort Logan Mental Health Center, a state
hospital in Denver, where the average length of stay for patients
enrolled in the adult treatment units is 98 days. Servicios de La
Raza and Asian Pacific Development Center are speciality clinics
serving Hispanic and Asian Pacific citizens...Each clinic provides
day treatment and outpatient counseling to homeless and non-
homeless mentally ill [HMI] individuals. (Wilson 1987 : 12-13)
Coordination of substance abuse and mental health services.
Despite the traditional separation between the substance abuse and
mental health service communities, there appears to be a need now
for better coordination. "Farr and colleagues (1986) found that, of
homeless people in Los Angeles who had a diagnosis of severe and
chronic mental illness, almost half also were chronic substance
abusers." (Breakley 1987 : 45) It is estimated that between 20 to
40 percent of the HMI individuals in the Denver area are either
situational or chronic abusers of alcohol and/or drugs. However, a
new demonstration program, jointly funded by the Colorado Alcohol
and Drug Abuse Division (ADAD) and the Division of Mental Health,
offers some hope. The project is housed at Aquarius Center
(Arapahoe Mental Health Center) and Arapahoe House and has as its
goal the improvement of community support and intensive services


62
provided for individuals who have serious mental illness and
substance abuse problems. (Wilson 1987)
Breakley summarizes that any transitional custodial care for
mentally ill and/or substance abuse victims is both extensive and
costly. He suggests that this care embrace three stages (1)
motivation, (2) treatment, and (3) rehabilitation. In the motivation
stage, the person is brought to the point of acknowledging that
help is needed. The illness may include a financial cost,
inconvenience, or discomfort entailed in the therapeutic process.
The second stage, acute treatment, may be the easiest. The acute
treatment techniques are known, and this phase of treatment can
be provided relatively easily. It is the third stage, rehabilitation,
that can present the greatest problems. In many cases, homeless
mentally ill persons or substance abusers have long histories of
maladaptive living and have developed entrenched lifestyles on the
street. Acquiring new habits is necessary if the person is to adapt
successfully to a healthier lifestyle. This can take a long time. In
some cases, indefinite plans must be made for support,
rehabilitation, and housing. (Breakley 1987)
Generic Transitional Cost Considerations
This section examines additional cost considerations that
apply to many transitional homeless assistance efforts and to some
emergency service programs. As evidenced by the extensive nature
of transitional custodial care and economic rehabilitation efforts,
their particular program costs can be exorbitant. Service delivery


63
coordination must be a consideration to reduce the program costs
in assisting the homeless.
Transportation needs constitute another significant cost
consideration. Many, if not most, homeless do not have
transportation; yet, they need to access many programs, agencies,
and services etc., to achieve custodial care or economic
rehabilitation. The Denver Department of Social Services (DDSS)
has recently initiated an innovative homeless transportation
system7 which involves a five-day per week, forty-four passenger
bus. This bus transports homeless persons between the emergency
night shelters and Denver's day shelters and can deliver persons to
Denver General Hospital, the Stout St. Clinic, and Warren Village
for day-care services. Twice a week it takes homeless persons to
DDSS and back. There are also approximately five light trucks and
vans owned by various shelters which daily meet a multitude of
shelter-and-homeless-person transportation needs involving goods,
service delivery, and emergency response. DDSS supplements the
Denver emergency shelters and many of Denver's transitional
facilities with a supply of bus tokens and cab vouchers for a variety
of intermittent individual trips. The yearly DDSS transportation
system alone costs about $20,000 and it meets only the most
fundamental needs. The Curtis Park Community Center and Warren
Village offer additional day-care transportation for homeless
7 The author conceived, developed, and manages this transportation system.
Mr. Schroer is the City and County of Denver's Emergency Shelter Grant
Program administrator. The DDSS transportation system was created in
response to a homeless assistance needs assessment performed in October,
1987.


64
families and the yearly cost for this totals about $20,000. DDSS has
identified additional transportation needs which could be fulfilled
by its transportation system that would require another $20,000
annually. A combination of additional funds for transportation at
specific emergency service and transitional homeless facilities and
extra DDSS transportation system financial backing from public or
private, sources may be necessary to achieve homeless assistance
goals.
Another cost reduction consideration for homeless assistance
programs is the opportunity for public and private financial and
material donations. These donations can significantly influence a
public, private, or non-profit homeless service provider to develop
specific homeless services and facilities. For example, earlier in
this thesis, it was described how donated buildings affected the
cost-effectiveness of emergency shelter supply options.^
For transitional homeless assistance efforts to succeed, the
various subprograms they depend on e.g., counseling, income
maintenance programs, day-care, etc., must also be effective. If
these programs are mismanaged or inept in delivering services,
they will increase transitional homeless assistance costs and
perhaps even prevent transitional homeless assistance goal
fulfillment.
Case management services also enhance a successful
execution of homeless assistance programs. "A case manager is
someone who guides a person in crisis to the appropriate services
to address the immediate emergency and prevent future crisis."
(Kaufman 1986 : 338) The essential elements of case management


65
include client identification and outreach, client assessment and
service planning, linkage to necessary support services, and client
advocacy. Many homeless persons require personal attention in
order to make the transition from the streets to a position of
economic and social rehabilitation or stable custodial care.
However, the staff costs that support case management services can
be substantial.
Finally, there may be no more important transitional
homeless assistance support service than specialized housing. Each
of the six homeless subpopulations has unique housing/shelter
needs during the transitional period. For example, the special
psychological and counseling needs of battered women necessitate
separate facilities to enhance the rehabilitation of these victimized
women. Optimally, separate housing/sheltering facilities should be
established for each of the six homeless subpopulations to enhance
transitional assistance efforts. Particular service needs call for
these separate and often specially designed facilities.
Preventive Homeless Assistance Cost Considerations
Primary and secondary preventive homeless assistance
program costs can be significant. "Homelessness is a costly social
problem. It is only costly, however, if we allow it to continue to
expand and increase in scope...Money will help only if it is focused
on the causes of homelessness and long-term solutions." (Kaufman
1986 : 344-345) Kaufman may be understating the effectiveness of
public, private, and nonprofit financial resources applied to
emergency service and transitional homeless assistance, but there


66
is no doubt preventive homeless assistance investments,
particularly secondary prevention programs, can be most beneficial.
Chapter IV of this thesis listed principal primary and
secondary preventive homeless assistance housing programs and
policies. A cost-effectiveness analysis should be performed from
among these options. It is estimated 3.5 million low-income people
in the U. S. cannot now find affordable housing. The number of
Americans requiring low-income housing but unable to find it will
grow to nearly 19 million by the year 2003 if current trends
continue, which will potentially swell the ranks of the homeless
living on city streets, according to a study commissioned by the
Neighborhood Reinvestment Corporation and the Massachusetts
Institute of Technology. [The Denver Post November 11, 1987)
Even though affordable housing needs for low-income persons
may supercede other needs, additional preventive assistance can
be applied to the six homeless assistance subpopulations. For
example, the Colorado Children's Campaign has identified the
following specific preventive measures to mitigate the number of
homeless families:
Two Parent Families
Reinstate AFDC-U so that impoverished two-parent families
need not be faced with the choice of separating to receive
assistance or becoming homeless.
Tie two-parent income assistance programs to work
expectations, recognizing that in many of these families the
mother has traditionally stayed home to care for children while
the father works.


Single Parent Families
67
Increase AFDC to single mothers so that it is adequate to
meet the cost of basic rent, food, and other necessities.
Provide remedial education, job search, and job training
assistance to homeless single parents to increase their earning
capacity above poverty.
Recognize child support as an untapped source of income
assistance for single mothers caring for children. (Gould 1987 :
14-15)
These specific family-oriented, preventive homeless
assistance strategies point out the fundamental importance of a
healthy economy and an effective public welfare and assistance
program network to combat homelessness.


CHAPTER VI
ADDITIONAL CBA CONSIDERATIONS/SOCIAL IMPACT ANALYSIS
Additional considerations, such as political and administrative
influences, affect homeless assistance goals and programs. There
are also other special economic considerations which affect these
goals and programs. These influences and considerations usually
cannot be or are not included in the homeless assistance
quantitative analysis. Political and administrative influences must
be examined since they may determine if the various homeless
assistance goals and programs can even be reached.. Homeless
assistance programs may be cost-effective and achieving certain
homeless assistance goals may be efficient, but unless the political
and administrative environments are sufficiently propitious, they
may not be executed or reached. Major political, administrative,
and economic considerations which must be examined by the CBA
analyst are reviewed below. This chapter concludes with a review
of the concerns within the homeless assistance CBA's social impact
analysis.
Additional Public Assistance Programs
Chapters IV and V of this thesis discussed the importance of
the various public assistance programs upon which homeless
persons depend. If these programs are mismanaged, insufficiently


69
funded, or not timely in delivering benefits to homeless persons in
crises, emergency service and transitional homeless assistance
goals may not be reached. Homelessness is a complex problem that
cuts across the usual categories of social services and usually can
involve most of the traditional local, state, and federal public
assistance and in-kind benefit programs. The CBA analyst must
assess the health of these programs and determine if they will
present administrative and cost barriers to the fulfillment of
homeless assistance goals.
Economic Conditions
Transitional and preventive homeless assistance goal
achievement will depend upon the performance of the local and
national economy in two vital areasjob availability and affordable
housing. Transitional homeless assistance directed at economic
rehabilitation will be stymied if jobs are not available or are poor
paying. Affordable low-cost housing may be the key economic
condition preventing homelessness. Transitional homeless
assistance programs depend on specialized housing/shelter
facilities to enhance successful execution. The CBA analyst should
perform a special study of the local housing market, opportunities
and resources for additional low-cost housing supply, and other
factors (such as rent control) which may affect the cost of housing.
Affordable housing for poor individuals and families combined with
gainful employment may be the best two remedies for preventing
homelessness.


70
Stewart McKinney Homeless Assistance Act
The Stewart McKinney Homeless Assistance Act has provided
$355 million nationally to combat homelessness. About $2.2
million of this funding pot will reach Colorado. Each of the three
primary homeless assistance goal areas is addressed by the Act.
Stewart McKinney funds are designated for emergency shelter
support, transitional housing, permanent handicapped housing,
supplemental assistance, Section 8 assistance/SRO, adult
education, and job training for homeless. The availability of these
funds will somewhat mitigate the need to perform a homeless
assistance CBA since the federal government is footing much of the
bill for broad program areas it deems critical. However, the
homeless assistance CBA can also still assist local homeless
programs officials select the most efficient specific homeless
assistance programs to be funded by Stewart McKinney. This
federally financed homeless assistance depends on administration
through state and local governments and private, nonprofit groups.
The CBA also can help allocate precious resources among the
homeless assistance goals and programs not supported by Stewart
McKinney. The homeless assistance CBA analyst should review the
current status of government homeless assistance funding.
Social Impact Analysis
The CBA analyst must consider if there is an equitable
distribution of homeless assistance benefits and costs as a result of
fulfilling the primary homeless assistance goals. Knowledge of this


distribution will assist the analyst to suggest an equitable funding
plan from among the public, private, and nonprofit sectors.
To begin, it is appropriate to consider the proper level of
financial support from the local, state, and federal governments.
Since each local public good [homeless assistance] has an
optimal number of users, or covers an optimal geographic area,
one can imagine in theory an optimal constitution, or prefect
mapping of functions as Bretan (1965) has called it, that assigns
responsibility for provision of such public goods to the
appropriate level of government representing only those persons
affected. (Boadway and Wildasin 1984 : 501)
In practice, this neat assignment of responsibility between
levels of government breaks down when considering homeless
assistance financial support. First of all, there is virtually no
information in Denver which crystalizes the source and cause of the
city's homeless population. There is no certainty as to where
Denver's homeless come from. Perhaps the homeless population
study now being developed by researchers at the University of
Colorado at Denver and staff from the Colorado Coalition for the
Homeless and the Denver Department of Social Services will shed
more light on these critical concerns.
Determination of homeless government financial assistance
gets even more difficult when one considers the location of the
homeless community. The central Denver neighborhoods
designated in the thesis as the hard-core homeless community
developed because of the public, private, and especially nonprofit
religious support and facilities available there. In Council District
#8, residents and business persons have the most to gain if
homeless assistance goals are reached; yet, these residents and


72
businesses have not caused the phenomenon of homelessness in
their community. The residents and firms in the homeless
community would have difficulty in contributing financially to
homeless solutions.
Median family income in Five Points (one of the homeless
community neighborhoods) ranged from $4,813 to $7,572 a
year, about a fifth of the 1984 city-wide median income
estimate...two thirds of the household incomes fall below
government established 1984 poverty income guidelines.
(Rocky Mountain News August 19, 1985)
Ladd and Doolittle confirm that the federal government
should be the primary financial supporter for programs to assist the
poor. Homeless assistance efforts could fit within these poverty
programs. This financial support role is given the federal
government on the basis of evidence that most Americans would
support, through taxes, government programs that help alleviate
poverty. Ladd and Doolittle also correctly argue that poverty is a
national phenomenon and that its sources and causes exist
throughout the country. The sources and causes of homelessness
also develop on a national basis. And, they correctly claim that not
all state and local governments have the same fiscal ability to
contribute to poverty maladies and homeless problems. A shift to
more state and local government financial support for poverty and
homeless programs would lead to uneven and horizontally
inequitable tax burdens across states. Finally, the mobility of poor
and non-poor (or homeless and non-homeless) is such that greater
state and local government support of poverty and homeless
assistance programs could eventually lead to greater concentrations
of poor and homeless persons. (Ladd and Doolittle 1982)


73
A Denver homeless assistance funding plan can be based on
the recognition that the federal government should supply most of
the financial assistance for homeless assistance programs.
However, there are no long-term prospects for continued federal
homeless assistance. And, Colorado and Denver may wish to exceed
federal homeless assistance goals and standards. Hence, it is
important that Colorado and Denver determine better the sources
and causes of homelessness in order to develop the most equitable
homeless assistance funding plan possible. Developing this funding
plan should follow the sequence listed below:
1) Maximize efficient use of federal homeless assistance
financial support;
2) Complete the local research determining source and
cause of Denver's homeless population; link these results with
other similar local and national studies;
3) Examine the distribution of benefits between Denver,
Colorado, and other locations; and
4) Demarcate Denver and state financial responsibility based
on the results above.
Currently, there is significant voluntary private and nonprofit
financial support for homeless assistance efforts. Since 1985, this
support has totaled approximately $9 million or about twice as
much as has been contributed by the City and County of Denver in
the same period. These contributions are considered efficient
since they result in the realization of benefits to the contributors.
Because this support is voluntary, equitable funding arrangements
among these private and nonprofit sources is not necessary.
However, clarification as to the sources and causes of Denver's
homeless problem may help these private and nonprofit entities


74
(which include foundations and church denominations) make
funding decisions which reflect better the preferences of their
members. For example, a church which is predominantly
financially supported by Edgewater residents may support homeless
programs according to the number of homeless from this Colorado
city.


CHAPTER Vn
CONCLUSION
The purpose of this thesis is to suggest a basic CBA
framework to examine the costs and benefits of competing
homeless assistance goals and programs. Denver's motivation to
assist its homeless population has been driven by factors other than
economic efficiency. However, as the most politically acceptable,
the most necessary, and the most appealing homeless assistance
programs, efforts, and services are implemented, public choices
will be harder among the remaining homeless assistance measures
necessary to maintain and enhance service to this afflicted
population. A homeless assistance CBA can lay a rational public-
policy decision-making foundation so that these remaining
measures, once implemented, can reflect an efficient allocation of
scarce public resources directed to their highest valued purpose.
This CBA analysis can help shield the most efficient homeless
assistance measures from political gamesmanship and program
mismanagement. It is hoped that this thesis can stimulate a CBA on
the primary homeless assistance goals and programs and be of
assistance now to other researchers, administrators, or advocates
pursuing vital homeless assistance aims. This thesis will be used by
its author to guide the establishment of a permanent


implementation, monitoring, and planning responsibility by the City
and County of Denver on homeless issues. The author is able to
perform this as a result of his job as Resource Coordinator to the
Denver Department of Social Services' Homeless Project Unit. This
Unit has been given the duty to carry out the homeless lead agency
functions assigned to the Denver Department of Social Services by
Mayor Federico Pena.
A suggested area for specific future CBA research is to
develop some empirical models for the comparison of various
transitional homeless assistance goal targets. Emergency homeless
service in Denver currently is considered sufficient and adequate.
Preventive homeless assistance solutions require national
developments. But there is a growing concern from among
homeless service providers in Denver that transitional homeless
assistance options be expanded. Another area ripe for immediate
CBA analysis is a comparison of the costs and benefits of Denver
welfare reform programs and one or more homeless goal target(s).
A key focus of this analysis is an examination of the coordination of
services among welfare reform and homeless assistance providers.


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84
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HOMELESS POPULATION TABLE
CITY DATA ON HOMELESSNESS
PERCENTAGE COMPOSITION OF HOMELESS POPULATION
PERCENTAGE
INCREASE IN PERCENTAGE ARE PEOPLE
DEMAND FOR EMERGENCY SHELTER INCREASE IN 0 OF FAMILIES FAMILIES SINGLE MEN SINGLE WOMEN YOUTH (a) MENTALLY ILL SUBSTANCE ABUSERS WORKING TURNED AWAY YES NO
BOSTON 10 10 20 65 15 0 32 29 25/10(b) X
CHARLESTON 23 144 27 70 3 0 20 30 30 X
CHICAGO 7 40 40 20 0 25 20 30 X
CLEVELAND 10 20 13 66 16 5 10 6 X
DETROIT 15 15 40 35 23 2 9(c) 30 X
KANSAS CITY 44 3 43 29 22 6 30 16 35 X
LOS ANGELES 25 40 30 45 15 10 27 27 10 X
LOUISVILLE 0 0 15 75 10 0 40 40 10
MINNEAPOLIS 20 .. 16 80 4 0 40 50 5 X
NASHVILLE 23 18 53 18 11 14 23 28 X
NEM ORLEANS 20 20 60 10 10 35 30 15 X
NEW YORK CITY 16 18 63 33 4 0 25 30 X
NORFOLK 17 30 35 50 15 0 X
PHILADELPHIA 40 66 33 43 24 0 20 60 25 X
PHOENIX 15 10 25 70 5 0 20 20 20 X
PORTLAND 12 15 52 31 12 5 20 60 X
PORTSMOUTH 60 27 13 0 X
PROVIDENCE 30 75 65 20 11 4 20 30 20 X
SAINT PAUL a 2 33 47 20 0 23 30 13 X
SALT LAKE CITY 20 20 30 60 10 0 25 30 25 X
SAN ANTONIO 7 20 30 52 4 14 54 X
SAN FRANCISCO 25 .. 20 45 32 3 45 45 10 X
SAN JUAN 35 25 24 53 3 20 50 50 39 X
SEATTLE 25 -- 30 55 10 5 40 40 30 X
TRENTON 15 15 50 35 15 0 10 40 10 X
WASHINGTON, DC 30 40 23 51 26 0 18 65/ll(b) X
(a) Data on homeless youth Is often not separated from those on single adults. Zero percentage does not necessarily mean that there are
no homeless youth In the city.
(b) 25* single adults; 10* members of families; 65* single adults; 11* members of families.
(c) Includes only homeless Individuals with documented history of mental Illness.
Source: U. S. Conference of Mayors
Survey performed in December, 1987 and percentage changes
observed between December, 1986 to December, 1987.


APPENDIX B
HOMELESS ACTION GROUP (HAG) HOMELESS
ASSISTANCE RECOMMENDATIONS
(1A) Establish, by ordinance, a right to shelter during cold
weather, with the city as the houser of last resort.
(2A) Reaffirm the right of all persons to have access to all
public places during normal operating hours.
(3A) Expand and improve the administration of the
Department of Social Services' hotel voucher program.
(3B) Add two additional beds in each adult shelter to
accommodate homeless youth.
(4A) Create a 20-bed facility for CMI women this winter.
(4B) Utilize houses foreclosed on by HUD as transitional
housing.
(4C) Negotiate with landlords and landlord groups for
reduced rents in order to create more transitional housing units.
(6A) Create a job development team to work in the
shelters.
(6B) Open an acute care unit as an alternative to
hospitalization and as a diversion for CMIs who commit
misdemeanors.
(6C) Provide shelters with funds to establish child care
programs.
(6D) Add seven beds to existing nursing homes for
severely dysfunctional substance abusers.
(7A) Open more zoned areas to community-based special
residential facilities.
(7B) Institute a fair share plan to disperse special
residential facilities throughout the city.
(8A) Create outreach teams to work with police in locating
hard-to-find CMIs.
(9A) Focus the efforts of the Citywide Services program
more clearly on the homeless CMI population.
(9B) Institute a system of case management and inter-
agency agreements for improving services to homeless alcohol-
substance abusers.
(10A) Create a drop-in center for CMIs.
(11A) Begin a public education program about the realities
of street life and addiction/substance abuse.
(IB) Establish by ordinance the right of CMI persons to
housing and mental health services.


87
(2B) Designate safe, legal outdoor sleeping areas.
(3C) Create two hundred new emergency shelter beds.
(4D) Develop 30-50 units of transitional housing for
persons showing promise of economic stability.
(4E) Add fourteen additional beds for long-term,
intermediate care for homeless alcohol/substance abusers.
(5A) Establish a state rental assistance program and more
Section 8 vouchers.
(5B) Develop adequate capitalization of the Housing Trust
Fund.
(6D) Expand publicly funded substance abuse programs.
(6E) Create crisis stabilization facilities for
decompensating CMIs.
(6F) Conduct an annual assessment to see if additional non-
hospital detoxification and emergency patrol services are
needed.
(6G) Increase the Alcohol and Drug Abuse Division's
hospitalization capacity for complicated withdrawal cases.
(6H) Open a domiciliary facility for substance abusers who
don't respond to treatment or have organic-brain syndrome.
(6J) Provide an assortment of supportive services for the
homeless alcohol/substance abusers.
(6L) Establish a toxic vapor abuse program.
(6M) Assure free medical care for all homeless persons at
the state level.
(6N) Start up support groups for CMIs in board and care
homes as a preventive measure.
(8B-8D) Hire two outreach/case management staff to work
with the mental health system to locate the elderly homeless.
(9C) Set up cross-training programs for shelter operators
and detox facility staffs.
(9E) Institute long-term case management for the most
difficult-to-treat CMIs and those who regularly decompensate.
(10B) Open a drop-in center for youth, offering varied
services.
(1 IB) Strengthen the school system-service provider
network for problem solving, communication, training, etc.
(4F) Expand the number of beds available for
alcohol/substance abusers in halfway houses.
(4G) Develop a model transitional housing project for
eight-to-ten elderly homeless.
(5C) Create a series of independent and semi-independent
living units for CMI homeless persons.
(5D) Adopt a city policy requiring replacement of low
income housing units destroyed through any city-subsidized
project.
(5E) Renovate Single Room Occupant (SRO) hotels as long-
term housing.


88
(5F) Develop assisted-living housing options for the elderly
homeless through liberalization of state regulations.
(6K) Hire three additional skilled outpatient counselors to
care for homeless alcohol/substance abusers.
(60) Establish new and expand existing vocational and
psychosocial rehabilitation services for CMIs.
(6P) Promote mobility for homeless persons through gas
vouchers, free bus tokens, and free car repair work.
(11C) Work with the media to heighten awareness of
runaway/throwaway youth problem.
(1 ID) Create an office of public education about chronic
mental illness.


APPENDIX C
TYPES OF SERVICES, FACILITIES, AND PLACES HOMELESS
FREQUENT
Emergency Shelters
Soup lines
Streets and Abandon Buildings
Safehouses
Truck Stops
Food Banks
Train and Bus Stations
Jail
Psychiatric Facilities
Social Services
Referral Services
Agencies
Church Basements
Emergency Assistance Agencies
Alcohol Abuse Facilities
Other Employment Services
VA Outreach Programs
training National Forest Land
CMI Facilities
Railroad Cars
Day Centers
Transitional Houses
SRO's
Motels
Clothing Banks
Hospitals
Detoxification Centers
Medical Clinics
Halfway Houses
Counseling Services
Temporary Employment
Overflow Facilities
State Employment Services
Chemical Abuse Facilities
Living Out of Vehicle
Osage (employment, job-
project.)
Ministerial Alliances
Source: Colorado Coalition for the Homeless


APPENDIX D
ST. FRANCIS CENTER NEEDS LIST
WARM WINTER CLOTHING
Oct April
LIGHT WEIGHT CLOTHING
May Sept
Mens winter coats
Winter gloves*
Long underwear*
Winter hats*
28-36*
Men's jeans and work pants, sizes 28-36*
tennis shoes*
Shoes, esp. snow boots and work boots* Socks, esp. white tube*
Socks, esp. white tube* Men's underwear, sizes 28-36*
Men's underwear, sizes 28-36*
Men's light weight jackets*
Work gloves*
Men's caps*
Men's jeans and work pants, sizes
Shoes, esp. work boots and
PERSONAL ITEMS
Bath towels*
Wash clothes*
Bar soap*
Shampoo*
Shaving cream*
Spray or pump type deodorant*
Combs*
Toothbrushes*
Ointment and balms*
Toilet paper*
Toothpaste
Sanitary napkins/tampons
Shoe powder/talc
Baking soda
Band-aids 3x5 and regular
Gauze pads
Hydrogen peroxide
Cotton balls
MISCELLANEOUS
Generic laundry soap*
Shoe polish, black and brown*
Books
Magazines National Geographic, Smithsonian, Readefs Digest


91
Newspaper subscriptions 3 The Denver Post, 3 Rocky Mountain
News
Envelopes
White writing paper
Stamps
Pens
Pencils
Good News Version Bibles
Coffee cups, six oz. hot cups
Jars of generic instant decaffeinated coffee
PRIORITY NEEDS


Full Text

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CONSIDERATIONS IN PERFORMING A COST-BENEFIT ANALYSIS OF HOMELESS ASSISTANCE ALTERNATIVES IN DENVER by William Michael Schroer B. A., University of Colorado, Boulder, 1976 A thesis submitted to the Faculty of the Graduate School of the University of Colorado in partial fulfillment of the requirements for the degree of Master of Arts Department of Economics 1988

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This thesis for the Master of Arts degree by William Michael Schroer has been approved for the Department of Economics by Julie L. Hansen Franklin J.

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Schroer, William Michael (M.A., Economics) Considerations in Performing a Cost-Benefit Analysis of Homeless Assistance Alternatives in Denver Thesis directed by Associate Professor Mei-Chu W. Hsiao This thesis examines the considerations in performing a costbenefit analysis (CBA) of homeless assistance alternatives in Denver. Chapter I lists four specific reasons to perform this CBA-scarcity of resources and alternative uses of available resources, maintenance of homeless assistance funding, quality control, and political volatility of homeless issues. Chapter II presents the determination of the three primary homeless assistance goals-emergency service, transitional, and preventive assistance. The desire of society to meet emergency service goals is not dependent on efficiency or other economic criteria. However, allocating resources between transitional and preventive homeless assistance goals should be based on these criteria. Three fundamental public policy questions surface in relation to this CBA: When and how does society best allocate resources between transitional and preventive homeless assistance goals once emergency service goals have been met? Which approach is more efficient, transitional or preventive? And finally, are there political or administrative considerations which will prevent the most efficient allocation of resources? Chapter III concludes with a suggested eleven-part homeless assistance CBA framework. Chapter IV identifies the six subpopulations in addition to the stereotypical male "hobo" or street person which make up the new homeless population. They are families, youth, elderly,

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women, chronically mentally ill, and substance abusers. All homeless persons can be grouped according either to their need for transitional custodial care or transitional economic and social lV rehabilitation. Chapter N also examines the benefit considerations generated by reaching each of the three primary homeless assistance goals. Three different types of benefit were applied in this analysis-benefits in money terms, incommeasurable, and intangible benefits. Chapter N finally suggests the Denver "homeless community" boundary to be the city limits of the City and County of Denver. Chapter v reviews the significant cost considerations per the primary homeless assistance goals. Chapter VI presents an overview of other political, administrative, and economic considerations which may prevent fulfillment of the primary homeless assistance goals and an equitable funding plan is considered as part of the CBA's social impact analysis. The conclusion and the future research plan for the expansion of this topic are given in Chapter VII. The form and content of this abstract are approved. I recommend its publication. Signed

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CHAPTER I INTRODUCTION Homelessness has commanded significant public attention in the United States and Colorado since 1983. In response to this growing problem. President Reagan signed into law P. L. 100-77. The Stewart B. McKinney Homeless Assistance Act. on July 22, 1987. Under the FY 1987 Supplemental Appropriations bill, Congress appropriated $355 million to deal with the problems of the homeless. According to the Stewart McKinney Act. a homeless individual is defmed as: (1) an individual who lacks a fixed. regular and adequate nighttime residence: and (2) an individual who has a primary nighttime residence that is -(A) a supervised publicly or privately operated shelter designed to provide temporary living accommodations (including welfare hotels. congregate shelters. and transitional housing for the mentally ill): (B) an institution that provides a temporary residence for individuals intended to be institutionalized; or (C) a public or private place not designed for. or ordinarily used as, regular sleeping accommodations for human beings. Homeless assistance alternatives are increasingly being considered and applied. Unscientific estimates place the number of homeless persons in metropolitan Denver at .1500-2900. (Jones 1987) The composition of the homeless population also has been

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2 difficult to estimate in Denver. The Washington D. C. based U.S. Conference of Mayors indicate that America's major metropolitan areas vary as to the percentage composition of this population (see Appendix A). The City and County of Denver is currently engaged with the Colorado Coalition for the Homeless, faculty of the University of Colorado at Denver, and various homeless service providers to develop one or two research surveys that will scientifically estimate the number of homeless persons and better clarify the percentage composition of the homeless population in Denver from among the major homeless subpopulations. These research instruments should help economists and other researchers learn more about homelessness in Denver and about the benefits, costs, and effectiveness of specific homeless assistance programs. They could help in defining the particular concerns and problems of the major homeless subpopulations.l Since 1985, the City and County of Denver has contributed nearly $4.5 million toward its homeless problems through city funds or other governmental or private resources it controls. (Jones 1987 : 6-8) By comparison, Denver's annual Department of Social Services budget (1987) is about $95 million. This Department has applied about $1 million of this amount to welfare reform activities in 1987. 1 A significant stimulus for these research surveys was the Right-to Shelter ordinance initiative campaign in the spring of 1987. A key homeless public-policy question emerged and remained unanswered: How many homeless are in Denver? The first survey which will estimate the homeless population should be completed by summer, 1988. Dr. Franklin J. James of the University of Colorado at Denver Graduate School of Public Affairs has been the key contributor to the development and design of these surveys.

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Causes of Homelessness Although homelessness dates back to colonial times in America, special forces have culminated in the 1980s to produce what is commonly called the "new homeless." Historically, the rise and fall in the number of homeless appears to be directly related to the structure of the labor market and overall economic conditions. Beginning in the late 1970s, there have been some large shifts in the composition of the homeless. Joining economic conditions as a cause of homelessness are two new factors that can broadly be grouped into 1) significant shifts in social welfare policy, and 2) the decline of the intact and extended family. (Erickson and Wilhelm 1986 : Introduction) A prominent shift in America's social welfare policies has meant a reduction in affordable housing for lower-income persons. High on the list of causes is the loss of affordable housing, as the federal commitment to public housing and housing assistance programs has disappeared and redevelopment of urban areas (demolition ot gentrification) has devoured hundreds of thousands of units nationwide; A shrinking supply and a growing demand leads, as one would expect, to upward pressure on rents. (Jones 1987 : 5) Additionally, spending on housing assistance has dropped from $30 billion in the last year of the Carter administration to $7 billion in 1986. (The Denver Post December 27, 1987) 3 Another important shift in social welfare policies has been the deinstitutionalization of chronically mentally ill persons without adequate preparation of a community-based mental health system. While getting chronically mentally ill persons out of large state asylums was a brilliant idea, many states took advantage of that policy shift to cut mental health costs. They failed to create in the local communities, to which patients would return, the kinds of housing, mental health, and social service supports needed. (Jones 1987 : 6)

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4 The broad groupings of significant economic changes, shifts in social welfare policy, and family crises as causes of homelessness do not really include substance (alcohol or drug) abuse, which has long been associated with honielessness. Among those people who used emergency shelters in the United States in 1984, 38 percent were assessed by shelter operators as having a problem with alcohol or other drugs. (HUD 1984) Reasons for a Homeless Assistance Cost-Benefit Analysis (CBA) Despite the significant amount of funds dedicated to the homeless problem in Denver, there is currently no scientific basis by which the various homeless assistance altematives are prioritized by the Denver region's homeless assistance administrators and advocates. A CBA of these altematives is a badly needed public policy planning tool. This thesis examines the considerations in performing this CBA of homeless assistance altematives in the City and County of Denver. A homeless assistance CBA is a useful exercise for reasons relating to: 1. Scarcity of resources and altemative uses of available resources. Society simply can not afford to waste precious public and private resources. available to combat homelessness. Welfare reform as well as homelessness has caught the public's attention. Both concems depend on financial resources from many of the same sources. A CBA can assist in the most efficient allocation of resources to combat these policy concems. For example, childcare services are seen as an essential support service to homeless and welfare families. However, child-care services require unique

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5 arrangements arid incur special costs when directed at either welfare or homeless families. Homeless child-care services usually involve extra transportation and security concerns. The Denver Department of Social Services has at least one federal grant program (Community Services Block Grant Program) which could be applied to either homeless assistance or welfare reform activities. 2. Maintenance of funding; A CBA can help justify continuance of public and private contributions to fight homelessness even if short-term efforts are not cost-effective. A greater willingness to pay to support homeless assistance efforts can be realized if certain altematives are proved more efficient or justifiable than others. For example, the costs to establish assistedliving programs such as rent subsidy efforts may exceed the firstyear benefits accrued from the programs. However, over a longer time period, these programs' benefits may. exceed the initial costs. A CBA can help determine the long-term benefits and costs of pursuing the various homeless assistance altematives. 3. Quality control. A CBA can assist in determining the most effective and efficient homeless assistance altematives. This benefits not only the homeless but the public-at-large by making the best use of public and private resources and solving better the social problems associated with homelessness. 4. Political volatility. The homeless issue is very vulnerable to an array of political, moral, social, and other influences. A CBA can lay a rational foundation for public-policy decision-making on the homeless issue and can minimize imprudent or indiscreet

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6 decisions. It can help cultivate homeless assistance strategies with potential and help screen out costly or unreasonable strategies. No evidence exists that a homeless assistance CBA has been performed in the U. S. No economic models exist which allow economists, other researchers, or administrators to compare and evaluate the various homeless alternatives. The economic literature gives no specific guidance in the development of a homeless assistance CBA. However, good CBA models exist in other human service policy fields such as job training and housing.2 These models present a useful initial basis from which to develop a homeless assistance CBA. Although excellent CBA models exist, an analyst must establish his or her own CBA framework on the basis of the myriad of variables which affect each analysis. Despite the room this allows for scientific creativity, each CBA must be well grounded in applied welfare economics. Summary of the Thesis Chapter II reviews homeless assistance goals throughout the nation and in Denver. Homeless assistance goals must be clarified and converted into operationally measurable form, or goal targets, before benefits and costs can be estimated. Three primary homeless assistance goals are identified-emergency service, transitional, and preventive homeless assistance. Chapter III considers the essential components of a homeless assistance CBA 2 Specifically, Reeder (1985) and Thornton (1982) have developed CBAs in the public housing and job trammg fields, respectively. Both CBAs were helpful in the development of this thesis.

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7 technical framework. The chapter reviews such components as the different methods used to define benefits (benefits in terms of money, incommeasurable benefits, and intangible benefits), time analysis, and sensitivity testing. Chapter IV examines the nature and scope of the homeless population in Denver. It also considers the most significant benefits which should accrue from fulfillment of the three primary homeless assistance goals. Chapter V reviews the major cost considerations in the execution of specific homeless assistance programs and other activities in order to achieve the three primary goals. Chapter VI examines other homeless assistance considerations which cannot readily be included in the formal CBA quantitative analysis but which cannot be ignored by the CBA analyst. These other considerations alone may prevent execution of otherwise beneficial homeless assistance efforts. This chapter reviews the social impact analysis which must accompany the other formal components of the. CBA analysis. An essential task of the social impact analysis is to suggest an equitable homeless assistance funding plan from among the public, private, and nonprofit sectors. The thesis ends in Chapter VII with the conclusion.

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CHAPTER II GOALS The first exercise in considering a CBA framework with respect to comparing homeless assistance alternatives is the identification of specific homeless assistance goals. Once goals are understood, the benefits of goal achievement can be estimated. Program benefits relate to a program's desirable results. As expressed by Haveman and Weisbrod (1983 : 80) ''What is or is not desirable depends, in tum, on the goals or objectives of the program." To best evaluate the City and County of Denver's homeless assistance goals, a comparison of these goals to those of other significant homeless assistance efforts is in order. Review of Homeless Assistance Goals3 A number of state and local governments across the country have initiated formal homeless assistance planning and have developed planning goals. By formal it is meant that there is an official congregation of public, private, and non-profit organizations assembled to plan or consider implementing homeless assistance 3 Prof. Bernie Jones of the University of Colorado at Denver's School of Architecture and Planning has collected documents from throughout the nation which list the goals of other municipal-, county-, or state government-sponsored homeless assistance efforts. Prof. Jones graciously allowed me access to these documents.

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programs. The goals provide a guide for homeless public-policy implementation and can be categorized as follows: 9 1. Emergency service. This refers to immediate, emergency shelter for homeless persons for a period usually not exceeding thirty days. Beyond sleeping accommodations and protection from the weather, emergency service can include meals, laundry facilities, local phone service, clothing, housing and job referral, showers, and counseling. The best and most innovative emergency shelter facilities are those which offer the greatest number of these supportive services to facilitate a movement to transitional homeless assistance services. (Redburn and Buss 1986) 2. Transitional homeless assistance. This is defined as assistance provided for a period from thirty days up to two years. Virtually every transitional assistance program defines the transitional period differently, but transitional homeless assistance facilities and services have the goal of providing the homeless person a longer-term stable living environment to facilitate rehabilitation and reintegration into society. (Redburn and Buss 1986) These facilities and services also have the goal of providing a longer-term, stable custodial care environment for the previously homeless person. 3. Preventive homeless assistance. This service attempts to reduce the numbers of homeless by finding solutions for families and individuals threatened with homelessness before they are forced onto the street. Expansion of low-cost housing options and rent or mortgage supplement programs are examples of preventive homeless assistance programs.

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10 Listed below are locations which address emergency service and transitional homeless assistance goals through a formal planning process. Minneapolis St. Paul: To facilitate homeless short-term, emergency assistance; To facilitate homeless transitional or interim development; and To facilitate homeless long-term self-sufficiency or stabilization and opportunities for full community participation. (United Way 1987) Tucson: To provide the opportunity for homeless people to successfully integrate into the community; and To reduce the negative impact of homeless people on the community. (Tucson 1985) Portland: To reach out to homeless people who need help in becoming part of the mainstream of community life, To be finn with t.P.ose who do not adhere to the community standards; and To create an environment in which business can flourish and major economic development agendas can be pursued. (Stone 1987) Pittsburgh: To help as many homeless people as possible to achieve self-sufficiency; and To provide decent and safe shelter and other essential life support services to those homeless people who are capable of achieving self-sufficiency. (Pittsburgh 1987) Locations in the following group incorporate a more comprehensive set of homeless assistance goals within their formal

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planning process which include emergency service, transitional, and preventive homeless assistance. State of Maryland: 1 1 To expand resources for the prevention of homelessness, and investigate possible changes in policies contributing to homelessness; To establish a strong emergency response to homelessness throughout the State; To significantly expand the supply of transitional housing for those homeless people who need time and assistance to stabilize their lives and establish their independence; To substantially increase the variety and availability of supportive housing for homeless people with special needs; To develop an adequate supply of low-cost housing and rental assistance programs to meet the permanent housing needs of homeless and potentially homeless persons; To augment the capability of the State to provide case management services to homeless persons; To promote self sufficiency for homeless and potentially homeless people through job-training and programs, legal counseling, transportation services, and day care; To improve the effectiveness of community-based programs that provide medical and psychiatric services for homeless and potentially homeless people; and To foster cooperation and coordination among all levels of govemment and all responsible State agencies, businesses, and community organizations concemed with homelessness and related issues. (Maryland 1986) Seattle: To create stable downtown neighborhoods by encouraging services which address the needs of a variety of ages and incomes and to create a climate in which all who live and work downtown can feel comfortable and secure:

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12 To provide high-intensity services to those who are temporarily displaced to get them back on their feet in a short period of time; To create programs for homeless persons seeking treatment for mental illness, alcoholism, and drug abuse, so that they receive treatment comparable to private care, have an opportunity for appropriate housing and support services, and live and work in an environment which supports recovery; To provide humane living conditions for those choosing not to pursue treatment but not allow their interests to supercede those of other residents; and To encourage other jurisdictions and city neighborhoods to provide comparable services-to avoid oversaturation of any one neighborhood with people having special needs. (Seattle 1986) State of Michigan: To promote interagency coordination on behalf of the homeless to help assure that homeless persons have access to all the benefits to which they are entitled; To provide outreach services to shelter's soup kitchens, and other locations which serve homeless persons; To protect the lives, -health, and safety of persons who are currently homeless by assuring funding for necessary shelter beds and services; To improve coordination between state hospital discharge practices and community treatment services to help assure continuity of care and prevent homelessness among the chronically mentally ill; To clarify the legal status of young adults for service program eligibility and propose necessary statutory changes so that runaway /neglected youth may be served appropriately; and To prevent future increases in homelessness by addressing the long-range housing needs of low income persons, including providing a continuum of residential options. (Michigan 1987) Philadelphia: To assure the availability of adequate emergency shelter during the winter;

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To develop long-range plans for adequate emergency shelter for the future; 13 To evaluate current efforts by all providers of services to the homeless; To identify additional resources in both the public and private sectors to combat homelessness; To develop a comprehensive strategy for permanent housing alternatives. (Philadelphia 1984) Phoenix: To provide shelter care to the homeless; To promote independence and stabilization of lifestyle for the homeless individual; and To ensure independence and stability for homeless individuals on a long-term basis. (Phoenix 1983) Alameda County, California: To prevent homelessness and to provide services to those who are homeless. (Alameda County 1987) Homeless Assistance Goals of the City and County of Denver Sirtce mid -1986, Denver Mayor Federico Peiia has organized a special homeless assistance task force called .the Homeless Action Group (HAG). The initial HAG mission was to present a plan "representing a community commitment, to ensure that all residents receive appropriate housing and other services necessary to achieve and maintain a stable environment." (Jones 1987 : 1) In the HAG's first public report released in February, 1987, nine "guiding principles" were listed to guide specific homeless assistance efforts in Denver. These principles are: 1) Homelessness is a real, not an imagined problem.

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14 2) Homelessness must be addressed and not ignored. 3) The community must acknowledge that many persons cannot provide for themselves and that it is up to the community to provide for them. 4) The causes of homelessness are multiple and most are not strictly locally based ones. 5) Homelessness is not new. 6) The homeless population is diverse and services to it must reflect this. 7) Street people have a basic right to be left alone. 8) The purpose of homeless assistance efforts is to make homeless persons self-sufficient economically. 9) Some homeless persons are antisocial and dangerous. These guiding principles were the foundation for the development of fifty specific homeless assistance recommendations (see Appendix B) to be pursued by the City and County of Denver in cooperation with other appropriate public and private agencies, institutions, and groups. A review of these recommendations indicate that Denver possesses a complete set of broad homeless assistance goals. The recommendations embrace emergency service, transitional, and preventive homeless assistance. The second charge for the HAG since July, 1987, has been to prioritize these recommendations and organize efforts to have them implemented. The Denver Department of Social Services, which supplies staff support for the City and County of Denver to the HAG, suggested that the following criteria be considered in determining homeless assistance priorities: What impact will the recommendations have on homelessness?

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How achievable is the recommendation within the next year? 1 5 How dependent is the recommendation on the occurrence of other recommendations? What are the resources presently available; what are other necessary resources? In a sense, these criteria resemble a crude CBA or costeffectiveness analysis (CEA). A CEA differs from a CBA by its focus only on the cost comparisons of different programs or activities necessary to achieve a specific goal. Yet, because the HAG's fifty recommendations have not been evaluated or examined through a qualified and rigorous CBA, there is no assurance that they have been prioritized according to economic efficiency and effectiveness. Without a CBA of homeless assistance alternatives, prioritization and implementation of these fifty specific measures and others which may develop later are still unprotected from personal preferences and political pressures and agendas. The most rational course for any public and/ or private homeless assistance project to follow in addressing all three primary homeless assistance goals (emergency service, transitional needs, and longer-term preventive homeless assistance) is to fulfill the immediate goal of meeting emergency situations then allocate resources to both the intermediate goal of providing transitional assistance and the longer-term goal of preventive solutions, according to efficiency and other important criteria. Homeless assistance needs will exist simultaneously in each goal area in all cities and states. Those locations which presently focus only on emergency service and transitional homeless assistance may be so

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occupied with these more immediate priorities that preventive measures have not yet been considered. 16 Certainly, meeting emergency service needs, primarily at each of Denver's emergency shelters, constitutes a current resource priority. Meeting homeless emergency service goals by providing temporruy, safe shelter often saves lives. Society appears to consider cost-benefit information superfluous to the decision to achieve emergency service goals; there is a strong political, moral, and social commitment to meet these goals despite their costs. Nonetheless, a homeless assistance CBA can be useful in evaluating homeless emergency services by analyzing and comparing the costs of the various programs which can meet specific emergency service goals. A homeless assistance CBA must also include analysis of emergency service goals to quantify and clarify the benefits from successful emergency shelter program execution and the cost savings when permanent homeless solutions are found. Three primary public policy questions surface in relation to this CBA. When and how does society best allocate resources between transitional and preventive homeless assistance goals once emergency service goals have been met? Which approach is more efficient: transitional or preventive? Are there political or administrative considerations which will prevent the most efficient allocation of resources? An estimation of the benefits derived from fulfilling each of the primacy homeless assistance goals will greatly contribute to, if not dominate, discussions about homeless assistance plailning and funding. A homeless assistance CBA can help answer the three

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17 fundamental questions posed above. A three-tiered set of goals based on emergency service, transitional, and preventive homeless assistance is the appropriate foundation for homeless public-policy development.

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CHAPTER III HOMELESS ASSISTANCE CBA FRAMEWORK CONSIDERATIONS Even though each CBA is a unique expression of the analyst who prepares it, there are necessary and well-established components which must be included or at least considered in each CBA. This chapter reviews those components and relates them to the uniqueness of the homeless problem. CBA is grounded in the language, logic, and values of welfare and public investment economics. This theoretical framework recognizes three primary justifications for governmental intervention in a market economy: (1) to achieve equity in the distribution of income; (2) to stabilize fluctuations in aggregate economic activity; and (3) to improve economic efficiency-for instance, by correcting market failure (e.g., regulating natural monopolies), providing goods for which markets cannot function ("public goods"), and correcting uncompensated losses and windfall gains to third parties ("extemalities"). Cost-benefit analysis, as it has been practiced in the past and is still generally practiced today, has concentrated primarily on economic-efficiency goals. The fundamental concern of this approach is scarcity of resources. Both in govemment and society, there are never enough resources to do everything that people would like to have done, so choices must be made., The good society is one in which all resources are used for their highest valued purposes, and each of these purposes is achieved in the most efficient and effective way so that no resources are wasted. Good government decisions are those that contribute to achieving these highest valued purposes in the most efficient and effective ways. (Andrews 1982 : 111)

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Defining Homeless Assistance Benefits for Each Goal and Goal Target 19 The benefits of achieving each of the primary homeless assistance goals-emergency service, transitional, and preventive homeless assistance-must be considered and estimated separately. Each goal then must be broken into its various operationally measurable forms or targets. As stated by Haveman and Weisbrod (1983 : 81) "For each goal, an operational measure of the degree to which the program achieves the goal is indispensable to program evaluation." For example, the broad emergency service goal is to shelter the homeless. A more specific operationally measurable form of the goal might be the provision of emergency shelter to 90% of Denver's homeless population. Or, all emergency shelters, in addition to sleeping facilities, should have provisions for food, showers, and laundry services. By making the broader goals specific to a level of service, the number or percentage of homeless persons helped, or other quantifiable measure, benefits and costs of homeless assistance altematives can then be better estimated. For the remainder of this chapter, goal targets refer to the specific operationally measurable form of the three primary homeless assistance goals. Measuring Benefits The first consideration in developing goal targets is estimating the public-good value of resources saved or consumed through homeless assistance efforts. The benefits can be valued

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20 and quantified in economic terms even if the good that is received from homeless assistance efforts is a public and not market good. The measurable objectives necessary for evaluation may not translate precisely into dollars to permit the desired cost-benefit calculation. This should not forestall an evaluation. The task then becomes to assess the desired change in shelter received or whatever is the specific goal target. Economists as evaluation analysts may then offer some guidelines regarding the dollar worth of these changes. For example, a benefit estimate can be developed on the basis of reductions in the number of arrests due to increased emergency shelter capacity multiplied by the average cost per arrest. These benefits are classified in money terms. Incommeasurable and intangible benefit considerations in reaching the homeless assistance goal targets also must be included in the CBA. Incommeasurables, according to Sassone and Schaffer (1978), can be quantifiable in economic or noneconomic terms but cannot be evaluated in money terms. Examples of incommeasurable benefits are improvements in educational and health status. Intangible benefits relate to unquantifiable benefits such as prestige, self-esteem, beauty, peace-of-mind, etc. The inconuneasurables and intangibles must be included in the CBA because as Haveman and Weisbrod (1983) point out, just because something cannot be put into money terms does not mean it is not a benefit. The incommeasurables and intangibles are the benefits which can make programs justifiable when their monetary values are insufficient. Despite the importance of incommeasurable and intangible benefits, valuations based on monetary values are usually

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more reliable and valid as predictors of the efficiency and effectiveness of public programs. Direct and Indirect Benefits 21 Those receiving direct benefits include homeless persons and the residents, firm-owners, visitors, and commuters who live, work, or visit in the existing City and County of Denver "homeless" community. Determining the location, boundary, and definition of the homeless c ommunity also determines which populations receive indirect benefits from viable homeless assistance strategies beyond the homeless community. Negative Direct or Indirect Effects In developing a homeless assistance CBA, negative direct or indirect effects from successful execution of the various homeless assistance programs within each of the three primary goal targets must also be considered. For example, a popular transitional or preventive homeless assistance program is job-training and placement. If this program is geared up during periods of full employment, there may be some costly labor displacement and consequent downward pressure on the real wage rate. An additional concern is that, if Denver's homeless assistance efforts prove successful, the area could become an attractive migration destination for other regions' homeless populations.

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22 Costs Two primary cost categories exist for the support of human service programs such as homeless assistance efforts. First, there are the direct program and administrative costs. These costs are covered by a variety of sources from the public, private, and nonprofit sectors. The opportunity costs of competing alternatives must also be considered. These costs can be measured in time or money. Note that in a fully employed economy, the. primary benefits also are achieved at the cost of displacing some other project and its benefits. Such opportunity costs ... enter in through the inclusion of an interest rate (cost of capital) and through the estiinated cost of purchasing the resources required for the project-resources that must bid away from competing uses. (Haveman and Weisbrod 1983 : 91) Haveman and Weisbrod's statement warrants some elucidation. Note their reference to a fully employed economy. If a homeless assistance project utilizes resources when the local economy is not in a period of labor market equilibrium, (meaning some of these resources would otherwise be idle) this project would require less displacement of other activities and benefits than would be the case if these resources were fully used. It is critical to determine if the benefits of reaching a homeless assistance goal would be greater than the benefits realized if these resources were to be used in some other program. It would be difficult to determine all the other program altematives to make this comparison. As suggested in Chapter I welfare reform may offer a standard competing program altemative to homeless assistance goal targets.

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23 Time Analysis Benefits must be evaluated according to their effect over time. A time analysis is a necessary part of any CBA in order to properly aggregate benefits and to correctly compare the benefits and costs of various public programs. Usually there are three components of time analysis: base -an estimate of the value of the benefit or cost in a reference period; time horizon -an indication of how long future benefits are assumed to exist; and discount rate -the rate at which future costs and benefits must be discounted to determine their net present value. This is based on the fact that a benefit or cost received at present, measured as a given amount of dollars, is worth more than one that is received some time in the future. (Thornton 1982) Equity and Efficiency Considerations Conventional CBA usually separates efficiency from equity effects. Even though within a local government boundary the benefits of a public program exceed the costs for it, the distribution of benefits and costs may not be socially desirable. Many CBAs include a social impact analysis which examines these distributional concerns and may suggest solutions and alternatives. A cost-benefit calculation may, indeed, be accompanied by observations on the resultmg distribution, and even by recommendations in this respect. But the quantitative outcome of a cost-benefit calculation in itself causes no distributional significance. It shows that the total of gains exceeds the total of losses, no more. (Mishan 1982 : 164)

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24 The basic needs or donor benefit approach offers an excellent model to consider the benefits of social action programs such as homeless assistance efforts. The essence of the basic needs approach is therefore the recognition of an externality associated with improvement (or deterioration) in the extent to which the basic needs of specified segments of society are met. The most obvious motivation for such an externality is altruism .. .It now becomes clear that our respective, individual quantification (willingness to pay) at the fact of a poor child being better nourished [or a homeless person given shelter] is something of a public good ... My willingness to pay for better nourishment can be added to others' in the same way that conventional CBA adds vertically various citizens' willingness to pay for an environmental improvement. (Harberger 1983 : 112) The willingness of individuals to pay to achieve specific homeless assistance goal targets can be estimated by the financial response and contributions from the various public, private, and non-profit homeless assistance providers. The basic needs approach is an attempt to ascertain the attitudes and views of the members of a society. Surveys and polling techniques can be used to estimate these social welfare views and attitudes. Benefits can also be measured by totalling individuals' willingness to pay for public investments such as homeless assistance. These are summed and if they exceed the costs of such an investment, it is presumed the investment is a beneficial or efficient one. If a society's willingness to pay for homeless assistance programs exceeds the costs for such efforts, investments in these programs are deemed not only efficient but equitable from a community's or society's perspective. It is presumed there is an equitable transfer of resources to those less fortunate (homeless) from those better

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25 off. As described above, direct homeless assistance benefits are and will be realized by the homeless and others in the homeless community. Indirect benefits are experienced by those who surround this community. As more is understood about the direct and indirect benefits of successful homeless assistance programs, the homeless community and the community's (public)-at-large's willingness to pay for these activities can be maximized. Even though there may be a greater willingness to pay for homeless assistance than the costs to support such activities, the distribution of benefits generated by successfully reaching homeless assistance goals may warrant examination in the social impact analysis. This examination can include the entities who receive these benefits and any redistribution or equity concerns. The social impact analysis also should include a suggested funding plan that equitably assigns costs to the appropriate level of government, private, or non-profit resource. Sensitivity Testing Estimated benefits and costs generated from homeless assistance activities should be evaluated in the following manner. The present value of net benefits accrued from reaching one of the homeless assistance goal targets is calculated by subtracting the present value of total costs from the present value of the total benefits. The net present benefit measures the net gain to society from undertaking the particular activity. Alternatively, a costbenefit ratio can be calculated by dividing the present value of total

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benefits by the present value of total costs. Such ratios facilitate comparison of alternative homeless assistance activities. 26 A CBA analyst must develop a benchmark estimate of net present benefits comprised of the most reasonable, agreed upon, and accepted set of key assumptions which underlie the CBA analysis for each goal target. The benchmark estimate will include cost, benefit, negative direct or indirect effect, and time analysis factor assumptions. Additional net present benefit estimates must be developed based on changes in these key assumptions. For example, components of time analysis can be adjusted to produce different benefit and cost results. Sensitivity tests, review the major assumptions and their rationale and assess the sensitivity of the findings to changes in those assumptions .... Through this process of examining the sensitivity of the benefit-cost findings to changes in the major assumptions and estimates, an assessment of whether net present value is positive can be made with far greater certainty than would be possible under a single net present value estimate. (Thornton 1982 : 156-158) Costs that support homeless assistance efforts emanate from a variety of public, private, and non-profit sector sources, including some outside of Denver. Benefits generated from reaching homeless assistance goals also are received by homeless persons, firms, and residents (taxpayers) beyond the City and County of Denver. In many cases there will not be a direct transfer of costs and benefits within the City and County of Denver. It is expected this CBA will identify significant costs and benefits external to Denver. As a result of this and the fact homelessness in Denver relates to national causes and solutions, the benchmark estimate should include private (Denver) costs and benefits as well as

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27 external costs and benefits. Finally net present benefit estimates or cost-benefit ratios can be evaluated or compared between different goal targets relating to different primary homeless assistance goals-emergency service, transitional, and preventive homeless assistance-or between different goal targets within one of these goals. Homeless Assistance CBA Framework A homeless assistance CBA must include the following eleven framework components. It must: 1) Convert goals into an operationally measurable forms (goal targets). The CBA analyst will require guidance from the public, private, and non-profit sector CBA participants and sponsors. 2) Identify the benefits in money or incomnieasurable terms. 3) Consider the intangible benefits for each of the primary homeless assistance goal targets. 4) Determine the homeless community boundaries. This will help define the direct and indirect homeless assistance benefits. 5) Consider whether there are any negative direct or indirect effects of homeless assistance efforts. 6) Review the costs for the homeless assistance programs or goal target options necessary to achieve the primary goal targets. These costs reflect the specific program costs necessary to reach the various goal target options. Opportunity costs also must be included in the analysis. In effect, a cost-effectiveness analysis is performed with this exercise.

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28 7) Develop a benchmark estimate or ratio for each goal target and describe the key assumptions which underlie the estimate and ratio. 8) Perform sensitivity tests based on changes in these key assumptions. 9) Compare the net present benefit estimates or cost-benefit ratios, for alternative projects, including the benchmark and sensitivity testing estimates and ratios, to present public policy guidance and flexibility. 10) Consider and review other homeless assistance assumptions, considerations, and other human service program information, etc., that is not part of the quantitative analysis, but of which any researcher must be aware to fully understand and appreciate the final CBA results. 11) Perform a social impact analysis focusing on the distribution of homeless assistance costs and benefits and current and potential homeless assistance funding sources to develop the most equitable homeless assistance funding plan. Better knowledge of the sources and causes of Denver's homeless population will help with this analysis and the development of this plan. Chapters IV, V, and VI examine additional homeless assistance framework components. Chapter IV reviews and considers the benefits of reaching goal targets within each of the three primary homeless assistance goals but does not precisely quantify or measure them. Included with this benefit consideration is a review of the criteria for the homeless community boundary. The fundamental cost considerations involved in implementing

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29 specific programs within each of the primary homeless assistance goals are documented in Chapter V. A listing of other pertinent homeless assistance CBA considerations, particularly political and administrative considerations, follows the benefit and cost chapters. Chapter VI also elucidates the assignments involved in performing the homeless assistance CBA's social impact analysis. Homeless assistance framework components 1, 5, 7, 8, and. 9 will not be focused upon for the remainder of the thesis. These components must be addressed with the aid of CBA financial supporters and public-policy leaders, or can only be fulfilled once the costs and benefits are determined. These components are also fundamentally dependent on actual situations and conditions at the time of the CBA analysis.

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CHAPTER IV BENEFIT CONSIDERATIONS In order to apply the homeless assistance CBA framework, an economist or other social scientist must examine the dimension of homeless problems according to the three primary homeless assistance goals4-emergency service, transitional, and preventive assistance. Within these goals, the various subpopulations which are afflicted with hoinelessness must also be examined to determine their special conditions which will affect the CBA analysis. The next three chapters undertake such an examination of the .benefit and cost considerations on the basis of the dimensions and conditions which presently exist in the Denver region. Research which documents the examination represents the best available information to study these dimensions and conditions in the region. These chapters represent an information and research review base for economists and social scientists performing a homeless assistance CBA. 4 The term goal target is now eliminated. It is assumed that the primary homeless assistance goals will be converted into operationally measurable forms.

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3 1 Dimensions and Conditions of Denver's Homeless Problems and Population The first chapter of this thesis briefly reviewed the causes of the new homeless in America. These major causes include deteriorating economic conditions for low-income Americans, shifts in social welfare policy (including significant cutbacks in federal and other governmental housing and other public assistance}, and the decline of the intact and extended family. New federal public housing authorizations have declined from $23.7 million in 1980 to $4.7 million in 1985. (Weicher 1984} Deteriorating economic conditions refers to dwindling employment opportunities for near poor and working poor citizens. For example, the national average annual unemployment rate between 1978-1987 was 7.2%. This compares to a national average annual unemployment rate of 5.6% for the ten year period 1968-1977. (Sprinkel 1988) It also refers to poor persons who are victims of unexpected personal and financial disasters which propel them into the condition of homelessness. Two additional causes which predate the rise of the new homeless but which add to this new homeless population include the deinstitutionalization of chronically mentally ill persons and alcohol and drug abuse. Street people constitute another component of the homeless population which is not part of the "new homeless." "Street people are those eccentric and bizarre people who have made the streets their home and have developed an idiosyncratic adjustment to that environment." (Breakley 1987 : 42}

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32 Overview of Denver's Homeless Population Before a homeless assistance CBA and other social planning around homelessness occurs, the analyst must familiarize himself with an understanding of homelessness, its causes, and its peculiar local manifestations. This education should produce an understanding that the homeless population is not homogeneous. A good understanding of the homeless phenomenon entails understanding the various subgroups among the homeless. Each subgroup has some unique needs while sharing the one need of a place to live. The chronically mentally ill for example, present many challenges that the (new poor) homeless do not: they may have never worked before, may never work. (Jones 1987 : 1920) Further, in addition to the stereotypical single-male "hobo," there are six distinct homeless subpopulations: families, youth, elderly, women, chronically mentally ill, and substance abusers. Homeless assistance providers estimate that families with children now represent over 30 percent of Colorado's homeless population. (Gould 1987) Estimates of the number of homeless runaway /throwaway youth who live in the Denver region range from 150 to 500. (Jones 1987) It is estimated that between 10 to 22 percent of the total homeless population seen in existing programs in Denver are age 55+. In actual numbers, this converts to 250 to 350 older persons. (Jones 1986) Mendelson and Young predict there are 1425 homeless substance abusers in the Denver region . (Jones 1987) Finally, staff from Denver General Hospital and the University of Denver conclude there is a 30 percent rate of mental illness in the shelter population. (Sachs-Ericsson, et. al. 1987) The Stout St. Clinic, which provides community medical services to

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Denver's homeless through the Health Care for the Homeless Project, reports that 68.3 percent of their clients are male and 31.7 percent of them are female. (Morrow-Jones and Van Vilet 1987) A survey planned by the City and County of Denver, the Colorado Coalition for the Homeless (CCH), and other community group and academic professionals is expected to scientifically estimate the number of homeless in Denver and Colorado. It is 33 expected to be completed by summer 1988 and may give the Denver region better precision as to the numbers of homeless in each of the principal subpopulations listed above. At that time, the relative subpopulation estimates can be compared to a reliable total homeless population figure to determine the more precise numbers per subpopulation. Economic Rehabilitation versus Custodial Care In general, the homeless can be classified into two groupsthose who need short and long-term custodial care and those who can be rehabilitated to a status of economic and hence social selfsufficiency. For the homeless who require custodial care, service requirements vary. A sizable fraction of the homeless population ... will continue to be homeless unless they are given some kind of sheltered living arrangement [custodial care] ... for most, it implies a congregate or other sheltered living arrangement, in the community, combined with specialized supportive services. For some, it may mean an independent, self-maintained residence with continuous close monitoring by others. (Redburn and Buss 1986 : 133)

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34 Homeless people in need of custodial care can include members of any of the six homeless subpopulations. Homeless persons who do not require custodial care possess the opportunity to achieve economic and social rehabilitation. Custodial-care programs can culminate in a transition to an economic rehabilitation program for a previously homeless person. Homeless Assistance Benefit Considerations Benefits achievable from reaching each of the three primary homeless assistance goals-emergency service or shelter, transitional, and preventive homeless assistance-are examined. Certainly skilled applied economists and other analysts may suggest benefits in money terms, incommeasurable, and intangible benefits in addition to the ones listed in the thesis. However, the following benefits produced from homeless assistance goal achievement represent perhaps the most significant. The public-good nature of homeless assistance also presents a very fme line between benefits in money terms and incommeasurable benefits. Incommeasurable benefits can be quantifiable in economic or noneconomic terms, but can not be evaluated in money terms. The dividing rod used in this thesis to separate benefits between these two categories is the quantification in money terms. However, many benefits expressed in money terms (e.g., reduced public health system costs) can also be perceived as incommeasurable, i.e., improved health of a certain number of homeless persons. A plethora of intangible benefits also exist. A good analyst can develop and justify these to the level the CBA analysis requires.

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35 Emergency Service Goal Benefit Considerations Reaching emergency service homeless assistance goals generates significant benefits for society. There is no doubt that emergency homeless shelter can save lives. Emergency shelters are particularly beneficial for victims of exposure (hypothermia) and fires. Saved lives here are incommeasurable benefits as well as intangible. Another intangible benefit from achieving emergency service goals is the psychological benefit for the homeless of reaching a "safe haven". Even though the best emergency homeless shelters can be congested and noisy, they at least offer an opportunity to collect thoughts, make phone calls, arrange for transitional and other support services, etc. For the most part, homeless individuals are law-abiding citizens, but some are crime-prone and antisocial. Their ragged appearance may offend other citizens, businesses, and tourists. Listed in Appendix C are services, facilities, and places homeless utilize or frequent. Some of these locations are places where the homeless person's presence is expected, e.g., food banks, social service offices, alcohol abuse facilities, etc. However. train and bus stations and truck stops represent locations where homeless persons' congregating can produce a negative effect by making these places of business less safe or less attractive. Homeless roaming the streets or holing up in abandoned buildings make a respectable neighborhood less attractive. Sufficient emergency shelter would reduce this "homeless congregation" at inappropriate locations. Providing sufficient emergency shelter for homeless is

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36 likely to stem the wandering of the homeless and may produce benefits measurable in money terms, e.g., increased tourism or business in the affected location and reduced sanitruy, insurance, and security costs for these businesses. It is also likely to make it easier for businesses in the homeless community to secure vital loans. Land values in residential areas near where homeless congregate would be protected or embellished if sufficient emergency shelters are provided. Incommeasurable benefits would include the preservation of attractive tourist (Curtis Park), business, and residential areas, as well as less business disruption from inappropriate homeless congregation. Adequate emergency shelter for homeless persons also benefits society by reducing use of the public health and hospitals system and processing through the criminal justice system. When homeless persons gather in inappropriate places, criminal activity can result. Adequate emergency shelter may reduce criminal activity and produce benefits in money terms by lowering criminal justice system costs. These lower costs pertain to the resources saved by the police, courts, and corrections systems because they do not have to investigate, arrest, prosecute, judge, sentence, or incarcerate as many of the homeless. The reduced costs of personal injury and property damage from less crime are also benefits in money terms. Less crime also means less theft and benefits in money terms are generated by the decrease in the costs of fencing, and in less damage to the stolen property. An incommeasurable benefit of reduced criminal activity is less wasted or inappropriate jail time. (Thornton 1982) For example, even

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37 though some homeless persons may commit crimes (e.g., vagrancy, disturbing the peace, trespassing, etc.) simply as a result of being homeless and not having shelter, their destitute status may lead to incarceration. This makes scarce jail space unavailable for incarceration of chronic law-breakers. There is also evidence that many of the homeless in jails are mentally ill and are in jail as a result of their mental illness. (Barrett 1986) These people have great need for mental health services-both emergency level services and ongoing services. Adequate emergency shelter offers the homeless mentally ill a better prospect of eventually securing mental health services than does a jail setting which may in fact exacerbate mental illness. It also will preserve the criminal justice system for criminals not requiring mental health services. An intangible benefit of reduced criminal activity from sufficient emergency shelter is a reduction in the psychological costs of crime to its victims. (Thornton 1982) If there is sufficient emergency shelter. homeless persons are less vulnerable to disease, sickness, and exposure. This is important since the homeless population is in poorer physical health than the general population. (Ropers and Boyer 1987) "Recent studies have shown that between 2 percent and 7 percent of the homeless have tuberculosis, a rate anywhere from 150 to 300 times higher than the national average," according to the National Centers for Disease Control. (The Denver Post May 8, 1987) Adequate emergency shelter may prevent further physical health deterioration for the homeless person and reduce public health

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38 system costs. The following services are offered homeless persons by the Denver Department of Health and Hospitals. 1) Emergency services. 2) Ambulatory services. 3) Hospitalization. 4) Referral for shelter, food, clothing. 5) When client apparently eligible, referral for assistance from categorical or other programs at the Denver Department of Social Services. 6) When client apparently eligible, assistance in referral to Social Security. 7) When client apparently eligible, discharge planning assistance when specialized services such as boarding home or rehabilitation services needed (when patient eligible). 8) Referral to appropriate community mental health team and service. 9) Health and Hospitals responsible for medical staffmg at Stout Street Clinic. That Clinic provides ambulatory care . Makes referrals to Health and Hospitals for speCialized treatment, hospitalization, specialized tests. Provides medical coverage for persons in respite beds at Samaritan Shelter. 10) Clinical Social Work services available in all facilities of Health and Hospitals except Denver CARES to provide counseling or assistance in referrals. 11) Social Services Technicians available at Denver General Hospital and in the Neighborhood Health Program to initiate the application process for categorical assistance or Medicaid. (Collins 1987) Sufficient emergency shelter would reduce service costs by the Denver Department of Health and Hospitals to the homeless population in services 1 to 6 above. In Colorado, the average charge per day, per person in a general hospital was $844.00 according to a study by Equicor, a joint venture of the Hospital Corporation of

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America and the Equitable Group. (The Denver Post Janua:ty 6, 1988) 39 Reduced public health system costs represent benefits in money terms. Incommeasurable benefits are similar to those generated from reduced criminal justice system activity. Sufficient emergency shelter should prevent use of the public health system by homeless persons and reserve it for those with unpreventable physical maladies. A substantial incommeasurable benefit realized from sufficient emergency shelter is a healthier population. Additional benefits measured in money terms can be realized when emergency shelter goals are met, which prevents more costly emergency service solutions. For example, the Reverend William Kraus, Samaritan House of Denver shelter director, says it costs about $6.50 to $7.00 a day per person for shelter services. The annual operating costs for this shelter, which was the nation's first to be designed and built strictly for work with the homeless, are about $600,000.00. (The Denver Post January 30, 1987; Rocky Mountain News November 26, 1987) A comparison of these costs to those of other emergency service altematives reveals regular overnight shelter facilities may be the least expensive option. For instance, when regular emergency shelter space falls short, the City and County of Denver resorts to a hotel voucher program. The vouchers range from $16.00 to $20.00 per night per homeless person. (The Denver Post January 10, 1987) A final incommeasurable benefit realized when emergency service goals are reached is political gains. If Denver or other metropolitan areas meet emergency service or shelter goals,

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significant political problems are eliminated from neighborhood, community, and religious groups. A municipal government's political capital can be preserved for other thomy metropolitan issues. 40 The overriding intangible benefit of attaining emergency service goals is fulfllling the fundamental moral obligation of sufficiently assisting a homeless population which perhaps experiences some of the greatest psychological and physical pain of any members of society. This moral obligation has historically driven the public, private, and non-profit sectors to assist the homeless with emergency service. Transitional Homeless Assistance Benefit Considerations Transitional homeless assistance involves providing a stable living environment for a period longer than thirty days but usually no more than two years. Transitional homeless assistance can be geared to securing a longer-term, custodial care environment for previously homeless persons, or it can focus on economic and social rehabilitation. The psychological, political, public health and criminal justice systems, and homeless-congregation-related benefits generated through fulfillment of transitional homeless assistance goals would be similar to those obtained by achieving emergency service goals, if homeless persons are able to successfully make the conversion to transitional homeless assistance. Unique benefit categories found by achieving transitional homeless assistance goals include those

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41 gamered from transitional custodial care and transitional economic rehabilitation. The benefits in money terms from transitional rehabilitative homeless assistance are significai.lt. If a previously homeless person enters a transitional program and eventually secures gainful employment as a direct result of the program, the present value of his or her earnings are benefits in money terms. If through successful rehabilitation efforts, individuals are liberated from substance abuse, mental illness, or other custodial care programs, the resultant reduced program costs are significant benefits in money terms. (Thomton 1982) Incommeasurable benefits achieved through transitional custodial and rehabilitative homeless assistance goal fulfillment are higher education or functional level for program participants, better health for these homeless clients, and life preservation. Successful transitional homeless assistance programs produce an improvement in a homeless person's general lifetime ability to function as an economic producer. This can be charted through an increase in the marginal productivity of labor and an increase in non-market productivity. Participants in these transitional programs usually receive significant investments in human capital (education) which is expected to enhance the present value of future productivity. Successful transitional programs increase the consumer decision making efficiency of program participants. (Weisbrod 1983) A noteworthy intangible benefit realized from reaching transitional custodial or rehabilitative homeless assistance goals is the psychological benefit of nondependence for those who

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42 have achieved self-sufficiency. The overriding moral concern of helping the suffering homeless population continues as an intangible benefit when transitional homeless assistance goals are reached. Preventive Homeless Assistance Benefit Considerations As with emergency service and transitional homeless assistance, preventive homeless assistance produces benefits through psychological stability to homeless assistance beneficiaries, political benefits to local government leaders, benefits from reduced use of the public health and criminal justice systems, and benefits from reduced undesirable homeless congregation. In totalling preventive homeless assistance benefits, it is assumed that individuals or families who are recipients of preventive programs are economically self-sufficient and employed or at least in a position of stability by virtue of being enrolled in a variety of public assistance or welfare programs. Preventive homeless assistance programs which reach preventive homeless assistance goals and prevent persons who are currently socially and economically selfsufficient (or who stand the best chance of escaping public assistance and becoming self-sufficient) from becoming homeless will yield the greatest benefits in money terms. The emphasis is on continuing or initiating the earned income and/ or output of these self-sufficient persons. The primary incommeasurable benefit from successful preventive homeless assistance programs is the preservation of the physical and mental health of potentially homeless people.

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Significant intangible benefits from these programs include preservation of individual self-esteem and peace of mind. The moral concern of helping persons and families on the brink of homelessness is again perhaps the greatest intangible benefit of attaining preventive homeless assistance goals. Additionally; successful preventive homeless assistance programs can be credited with the benefits realized from eliminating the need for emergency and transitional homeless programs. 43 Preventive homeless assistance programs can either focus on primary prevention or secondary prevention. Primary prevention programs are those applied to the most vulnerable homeless populations before they become homeless. They are broad in application and have the effect of bolstering an individual's or family's ability to advance to or maintain economic and social self sufficiency. Program examples would include rent subsidies, lowincome/low-cost housing, and fmancial budget counseling. Sanjek recommends the following comprehensive list of primary prevention homeless assistance programs: 1. Preservation of rent control. Federal policy to deny funds to localities with rent controls will increase, not prevent, homelessness. 2. A moratorium on-or, at least, increased tenant protection in the face of-cooperative and condominium conversions. 3. Housing production programs and/ or mortgage subsidy efforts for new or rehabilitated low-and moderate-rent housing. 4. Policies that prevent landlord abandonment of buildings. Federal regulations could encourage localities to formulate such programs. 5. Preservation of single room occupancy housing [SRO] through tax incentives and direct subsidies.

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44 6. Tax policy reversing the trend of a decreasing proportion of taxes paid by business. The present policy shifts the burden of higher property taxes to home owners, and makes it difficult for low-income home owners to maintain and stay in their homes. 7. National credit allocation policy ensuring a percentage of available credit to housing needs, at affordable interest rates. (Sanjek 1986 : 319-320) In fact, any program which enhances the ability of the working poor (or persons on welfare) to remain self-sufficient can be given credit for contributing to the prevention of homelessness. The problem with totalling benefits from primary preventive homeless assistance programs is that it is difficult if not impossible to determine if the primary prevention programs actually do prevent homelessness. ''That is why, in the near term, therefore, the strategies likely to be cost-effective in reducing the incidence of homelessness are those that offer secondary prevention, that is, interventions that occur at or soon after the time when a person or family loses a home." (Redbum and Buss 1986: l27) Secondary prevention programs are applied to situations where homelessness is imminent. Examples of these programs include emergency rent subsidy programs, foreclosure prevention programs, and eviction assistance efforts. Preventive homeless assistance programs, whether primary or secondary, emphasize housing needs as opposed to other economic needs. Homeless Community Boundary Considerations Defining the "homeless community" boundary is an essential exercise for the homeless assistance CBA analyst. This boundary

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45 will help determine who receives direct and indirect benefits from the achievement of homeless assistance goals. Obviously, the homeless community will include the area where emergency and transitional shelters are located. Hiawatha Davis, City Councilman for Council District #8, City and County of Denver, has said that 90 percent of the city's homeless shelters are in his northeast Denver district, and in the Five Points, Cole, and North Capitol Hill neighborhoods. (Rocky Mountain News August 19, 1985) Transitional facilities are more dispersed. "Districts #1, 8, and 9 each house over 600 beds for the needy, while District # 7 contains a mere thirty-eight beds, and District # 5, forty-six beds. District# 6 has 100 beds and District# 4, 213 beds." (Washington Park Profile June, 1987) In order to determine the homeless community boundary, however, it also is important to pinpoint where the homeless congregate. Businesses and neighborhood leaders can document the negative effects homeless persons have in their areas. Earlier in this chapter it was stated that the negative effects homeless congregation produces on businesses and residential areas could be mitigated with sufficient levels of emergency and transitional facilities and services. Mitigation is the key word. Adequate emergency shelter and transitional facilities and services for homeless will not eliminate congregations of the homeless. The homeless population is mobile and must move about to secure the necessary serVices for support and/ or rehabilitation. Adequate homeless assistance facilities and services and cooperation among businesses, residents, and homeless persons can preserve the

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attractiveness and economic vitality of areas with homeless facilities. People can leam to live with one another. However, despite these efforts, a homeless community "stigma" can still result. A final consideration in developing a Denver homeless community boundru.y is to track the source of financial support from the public, private, and non-profit sectors which back homeless assistance efforts. It appears the bulk of this financial support comes from Denver city government and Denver foundations, churches, and nonprofit institutions. Another significant financial backer is the federal govemment with the passage of the Stewart McKinney Homeless Assistance Act. (Allocated to Colorado was $2,212,000.00; the lions share was directed to Denver.) 46 Clearly, Council District# 8 could be considered the city's and the metro region's hard-core homeless community. Several other Council Districts are also significantly affected. Yet, since Denver's economic health partially depends on the vitality of these Districts and the fact that the predominant fmcincial support to solve homeless problems emanates from Denver's government, churches, foundations, and norlprofit institutions, the homeless community should be considered the City and County of Denver. Populations which may be considered indirect beneficiaries of successful Denver homeless assistance activities include the rest of metro Denver and other municipalities in Colorado. These areas indirectly benefit when the City and County of Denver's economic vitality is bolstered. These locations should also absorb less

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47 homeless migration if Denver's homeless facilities and services are sufficient. The nation's taxpayers who have contributed to the Stewart McKinney Act and other federal homeless assistance aid could be considered indirect beneficiaries; yet, the impact of reduced federal homeless assistance funding as a result of permanent homeless solutions in Denver would be minimal.

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CHAPTER V COST CONSIDERATIONS This chapter identifies fundamental cost considerations for each of tl:ie three primary homeless assistance goals-emergency service, transitional, and preventive assistance. These cost considerations include those which should be considered for virtually all specific programs necessary to reach the homeless assistance goals. The prospect of successful homeless assistance programs increases. if there is a continuum of services which connect emergency service, transitional, and preventive homeless assistance into one process so that homeless individuals do not fall through the crack. If shelter, income [from public benefit programs], and food provide the necessary ingredients of an emergency response, housing assistance, supportive services, and employment assistance provide the second phase response. Taken together they can lead a person to the third phase: permanent housing, employment, and/ or adequate income and supportive services. What is important is that different people use different services. (Kaufman 1986, : 342) Kaufman aptly describes the three service phases necessary to fulfill emergency service and transitional homeless assistance goals. However, the continuum of services is not complete unless preventive homeless assistance is included. "Solutions will only be successful if they attack the root causes of homelessness which include inadequate income [employment], inadequate housing, and

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49 inadequate social and mental health services." (Kflufman 1986 : 339-340) Within this continuum of services there are distinct cost considerations for each homeless assistance goal. Emergency Service Cost Considerations The principal emergency service cost categories include four viable emergency shelter supply options. The most common strategy for housing the homeless is the conversion of existing buildings or dwellings to emergency facilities. The second altemative is factory construction of portable emergency housing. { ... cost [between these two options] depends upon the availability of public buildings that can be had at no cost, the availability of public land, the cost of existing buildings, the cost of privately held land, and the cost of renovating existing buildings. Absent the existence of a free building, or of a privately held building that can be bought at low cost and which requires minor renovation, factory-built housing will be more cost-effective. But with a free public building that requires little earthquake reinforcement, conversion is more cost effective. (Callahan, et. al., 1986 : 372-374)} The third emergency shelter supply option is construction of a new large shelter facility. Denver's Samaritan House, the nation's first designed and built strictly for work with the homeless, cost $6.17 million to build. It has 122 beds for men, 48 for women, and 80 beds in its 20-room complex for families. (Rocky Mountain News November 26, 1987) The Rev. William Kraus, Samaritan House director, said it will cost about $600,000 a year to run the shelter, which comes to about $6.50 to $7.00 per person per day. (The Denver Post January 30, 1987) New construction is the least cost-effective emergency shelter supply option. Why did the Catholic Archdiocese build

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50 Samaritan House? Is a brand-new facility more cost-effective than the other three options in the long run? Or, perhaps the Archdiocese is so committed to helping the homeless, it wanted to institutionalize its service commitment through the construction of this new facility. The short-term cost-ineffectiveness of new emergency shelter facilities can be seen with a comparison to the York St. emergency shelter facility in northeast Denver. This shelter is managed by the Volunteers of America to whom The City and County of Denver leases the shelter building at no cost. The renovation costs for this 150-bed emergency shelter totalled. $175,000. (Jones 1987) The fourth emergency shelter supply option may be the most cost-effective because there is no renovation or construction involved. This emergency overflow service involves two downtown churches opening their basements to accommodate up to fifty men overnight at each church. It is a no-frills service, which offers emergency shelter when the regular emergency shelters are full. Other emergency service support such as provision of laundcy facilities is not offered and the homeless are expected to find this support elsewhere. The cost for fifty vinyl-covered mats which serve as beds for the homeless at the churches was $1500.00. (The Denver Post Januacy 10, 1987) Maintenance costs for these overflow facilities include toiletries, cleaning, utilities, and two meals per day. This totals about $180.00 per night for fifty persons.

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Staff support to run each of these shelters is no more than $30,000.00 to $40,000.00 per year.s 51 This emergency overflow service is not a blanket solution and usually applies only to overflow or extreme emergency situations. However, it is a viable option which should be compared to the other three emergency shelter supply options if there is a need to expand emergency shelter beyond that already supplied by the other supply options. Churches have been good locations for these overflow facilities because of different faiths' concern for the homeless. Many are located in the homeless community and many have large areas such as basements which act as the bedding area. Appendix D lists clothing, personal, and miscellaneous needs for persons in emergency shelters. It does not list food, which can be supplied at the emergency shelter or by a separate soup kitchen or food bank. Cafeteria-style meals for homeless persons can cost as low as $1.50 per person.6 Other costs to run an emergency shelter include: cleaning, maintenance, facility repair, utilities, insurance, staff and other administrative costs, and furnishings (unless these are donated). Laundry services are considered an option. A final emergency shelter cost consideration centers on the public assistance programs which can enable the homeless to gain a 5 Cost information on the emergency overflow service comes from Ms. Christine Hager, director of the Central Presbyterian Overflow Shelter in downtown Denver. 6 This information was obtained through a conversation with Harry Ilg, director of the West Hotel in downtown Denver. Mr. Ilg plans a SRO facility at the 11th Ave. Hotel in the downtown area. This facility will have a kitchen which can prepare inexpensive meals for homeless and working poor persons.

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52 more stable foothold and break the cycle of homelessness. Many homeless individuals and families may not receive benefits from these public programs while in emergency shelters but they may apply for them during this emergency service phase. Direct financial or in-kind assistance from these public assistance programs can help assist homeless persons through the emergency shelter experience as well as during transitional programs. Financial assistance programs for the homeless can include Aid to Families with Dependent Children, County General Assistance, Veterans Assistance, Unemployment Insurance, Worker's Compensation, Social Security, and Supplemental Security Income. Principal in-kind assistance programs for the homeless are food stamps, Medicaid-Medicare, and public housing. The Denver Department of Social Services estimates 40 percent of the city's homeless are eligible for some form of public assistance. Homeless solutions can potentially involve virtually every public assistance, income maintenance, and other available human service program. If these efforts are not cost-effective, homeless assistance strategies which depend on them will he harder pressed to be efficient. A homeless assistance CBA relies in part on an evaluation of the cost-benefit and overall effectiveness of these human service programs. For example, Reeder (1985) has discovered Section 8 existing housing achieves the same goals as the "new construction" public housing programs but with greater flexibility and at lower cost.

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53 Transitional Homeless Assistance Cost Considerations Transitional homeless assistance facilities can either be a program component within an emergency shelter or a separate entity. For example, the Samaritan House shelter will extend support up to ninety days, two months beyond the thirty-day emergency service period, if homeless clients develop and keep to a transitional. "plan" through job-seeking, training, etc. Savings can be realized and a continuum of homeless assistance services can be achieved if emergency service and transitional assistance efforts share administrative and other program support costs. This review of transitional homeless assistance cost considerations examines costs associated with separate transitional programs and discusses them relative to the various homeless subpopulations. Among the cost considerations are transitional economic rehabilitation and transitional custodial care. The chapter concludes with a generic review of homeless assistance cost considerations that affect most specific transitional homeless assistance programs and a brief review of preventive homeless assistance cost considerations. Families An example of a transitional program which targets families is Warren Village. This facility is a multi-service residential program that helps low-income, single-parent families move from public subsidy to economic self-sufficiency. The program offers intensive, short-term support and help to parents to achieve financial

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54 independence. Families participating in the program are able to stay in the Village as long as twenty-four months. During this time residents have safe, affordable housing for their families, access to quality child care, and the assistance of counselors in setting and achieving personal goals. (Hernandez 1987) Warren Village has been recognized nationally as a model transitional economic rehabilitation program. Its commitment to servicing homeless families was recently bolstered by a Stewart McKinney transitional homeless assistance grant. Service needs for families in transition have been thus identified. The order of service need ... was child care, career counseling, job training, employment, income, and education. Child care was identified as a need among 77.6% of the sample. Career counseling was a need for 61.5% while personal and parenting counseling were each identified as a need for 56.1% of the sample. Job related needs such as job traini11g. entry level job, and job improvement were identified as a need for 40.5%, 34.1% and 26.8% of the sainple respectively. Education related needs such as GED and college education were identified as a need for on:Iy 17.1% and 10.7% of the sample. (Hernandez 1987 : Executive Summary) Youth Transitional homeless assistance directed at runaway /throwaway youth must meet the needs of this subpopulation. Among the needs which go unmet or undermet are such basics as coordinating outreach efforts to make runaway /throwaway youth aware of services which are available, community education and awareness programs, educational programs for parents and youth alike, basic job skills training and job placement services, and basic life skills (independent living skills) training. (Jones 1986 : 2)

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Urban Peak is a recently formed youth service facility operating in Denver's Capitol Hill neighborhood. This non-profit group offers outreach, referral, and counseling services. Elderly 55 The service needs of the elderly homeless qualify them as a distinct homeless subpopulation. Needs of this group identified by the Homeless Action Group's (HAG) elderly sub-committee include: Health care screening and services located at shelters, outreach services, adult protection services, transportation to existing service programs, supervision, case management, and appropriate low-cost housing alternatives combined with service packages. Marine summarizes senior medical and health costs which constitute perhaps this subpopulation's largest cost area. Medical and health services for seniors are specialized and they include ambulatory and primary care, geriatric assessment, general hospital care, rehabilitation (hospital-based), dental services, vision care, podiatric care, mental health services, hospice care, Health Maintenance Organization (HMO) for those over sixty-five, education about self-care, and prevention. (Marine 1987 : 10) Women Transitional assistance cost considerations applicable to single homeless women should include the need for privacy and anonymity, the need for storage facilities, unique gender-related needs, and the need to preserve or expand social relations and social networks. (Koegel 1987) Single women also should receive the specialized service required if they belong to one of the other homeless subpopulations. However, there is a condition unique to women which has caused society to develop separate transitional

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56 homeless assistance facilities for them. This condition is the battered woman. "Impetus for developing shelters for victims of domestic violence has been generated by a growing awareness of the cultural oppression of women, more empirical research on the prevalence and causes of wife abuse, and the passage of domestic violence legislation by an increasing number of states." (Stone 1986 : 299) Women who need shelter to escape domestic violence are homeless, but not all homeless women need battered women shelters. Battered women shelters act as a transitional service for women who can rehabilitate economically and socially. In addition to the costs for rehabilitative services, special counseling, security, and medical costs must be included in maintaining a battered women's shelter. Transitional Economic Rehabilitation Cost Considerations. All homeless persons in transitional assistatJ.ce programs are either in need of longer-term custodial care or can be economically rehabilitated. This rehabilitation means fmding a permanent job with pay sufficient to maintain a self-supporting lifestyle. There is a need for a continuum of employment services for the economically disadvantaged homeless. These services, as identified by the HAG Economically Disadvantaged Subcommittee includecounseling, job readiness, job training/retraining, job search, job development, and on-the-job training. In addition, it is important that the homeless have access to a variety of job opportunities and necessary support services such

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57 as public transportation and child-care to keep jobs once they are found. There are at least three Denver-based programs which now offer employment assistance to homeless persons. One provides a special team through the Denver Employment and Training Administration (DETA). The team consists of a job developer and employment counselor I case manager who work with the shelters in securing employment for the homeless. The job developer negotiates with prospective employers and identifies employment opportunities. The employment counselor I case manager work directly with clients and assists them with pre-employment counseling, skills assessment, job readiness counseling and supportive services, as well as job referral and placement. Labor's Community Agency, an arm of the Colorado AFL-CIO, also helps homeless people secure gainful employment. Another special local homeless economic rehabilitation program is the Osage Initiatives Project. Osage Initiatives is a unique, collaborative approach of area businesses, government, and community agencies to develop a one-stop employability and employment center for Denver's homeless population. Its primary purpose is to provide adequate and meaningful job opportunities to the homeless and potentially homeless. Osage Initiatives includes two basic componentsemployability services, including literacy and basic education, housing counseling, employability skills, and job training and development through the existing non-profit organizations involved; and on-site employment through the development of new

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58 businesses located at Osage. (Osage, 1987) The Osage Project is a comprehensive approach which uses the expertise and skills of existing non-profit agencies instead of requiring new and expensive government programs. The Osage Project's costs include the operating expenses of these agencies plus the renovation and other costs of the Osage facility (which coordinates the services of these agencies) at 1175 Osage St., Denver. Renovation and other Osage start-up costs were $3,745,000. Building maintenance costs come from agency rental payments. (Osage 1987) Transitional Custodial-Care Cost Considerations. Homeless persons who are victims of substance abuse and/ or are chronically mentally ill require special custodial care. This transitional custodial care can lead to a long-term custodial care status or culminate in participation for homeless persons in economic rehabilitation transitional programs. Even though many homeless persons suffer from mental illness and substance abuse maladies, the professional response from mental health and substance abuse experts has historically not been coordinated. Transitional Custodial Care for Homeless Alcoholics/Drug Abusers. Substance abusers are persons who have alcohol and/ or drug dependencies. Transitional custodial care for homeless alcoholics I drug abusers is focused principally on their physical health. Homeless substance abusers who are alcoholics require special custodial care.

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59 The alcohol-abusing homeless are simply much sicker, on the average, than the nonabusing homeless. Compared with the nonabusers of either gender, abusers are four to seven times as likely to suffer from liver disease, twice as likely to suffer serious traumas, two to three times as likely to be disabled by seizure disorders or other neurological impairments, and also twice as likely to be present with various nutritional deficiencies (predominantly malnutrition and dehydration) ... liver disease among this population is, for all practical purposes, restricted to the alcohol-abusing subgroup. Other disorders that are at least 50 percent more common among the alcohol abusers than among the others include hypertension, chronic obstructive pulmonary disease, gastrointestinal disorders, and arterial disease ... Not only are homeless alcoholics homeless and alcoholic-a circumstance that is bad enough-but they also are disproportionately drug abusive, psychiatrically impaired, and physically ill. .. Health service costs for the homeless substance abuser include detoxification or dry-out programs. Many of the homeless alcoholics are likely to be detoxified dozens, if not hundreds, of times at enormous societal expense. (Wright et. al. 1987 : The City and County of Denver operates two acute care/ detox facilities. The first, Denver CARES (Comprehensive Alcoholism Rehabilitation and Evaluation Services) is non-hospital based and has a 197-bed capacity. The second acute care program is a dedicated unit of Denver General Hospital. Transitional custodial care for homeless mentally-ill persons. Chronically mentally ill are those whose mental illness interferes with their capacity to maintain economic self sufficiency and to function socially. Casualties of deinstitutionalization, many have fallen through the cracks of the community mental health system. Deinstitutionalization without community support and adequate housing for mentally ill persons has contributed to the problems of homelessness in America and Colorado, but this is not the only concem.

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60 Although studies demonstrate that there are mentally ill individuals among the homeless, not all (or even most) of the homeless are chronically mentally ill. Those who are mentally ill focus on their housing and welfare needs rather than on mental health treatment needs. Do the homeless mentally ill need more mental health treatment or a return to the asylum, as some have suggested? Or is the problem more fundamental, a lack of adequate community-based housing, jobs, and other services? (Goldman and Morrissey 1985 : 729) Goldman and Morrissey pose interesting questions. Is the key to successful transitional custodial care for homeless mentally ill to provide both mental health treatment and other necessary support services? It appears so. Homeless mentally ill persons, who have traditionally been underserved, present a variety of problems requiring a broad range of services. Their needs include emergency food, shelter and clothing, opportunities for positive social interaction, mental health services, health care, rehabilitative services, income support, irtdividual assistance in accessing needed services, and permanent housing with supportive services. The special needs of this population have also required the development of new approaches to service delivery and the creation of new alliances among policy makers and service providers. (Reyes 1987 : 3) Despite this range of needs, mental health services deserve special focus. The challenge for service providers will be to devise community programs that address the multiple problems of the mentally ill homeless and that are more acceptable to them than traditional mental health services. Wilson succinctly describes the current mental health service system in Denver. The mental health system in Denver consists of four private, nonprofit community mental health centers, Citywide Services, Denver General Hospital, two clinics serving the special needs of ethnic minorities, and other clinics operated by churches or other non-governmental entities such as the Colorado Coalition for the Homeless. Each of the four community mental health centers in Denver provide a comprehensive array of services to the community and all have special programs for the chronically mehtally-ill individuals. These special programs include partial-

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61 day care, outpatient, and residential services. These programs provide social and vocational rehabilitation, protection and advocacy, income support and entitlements, medication prescription and monitoring, supportive counseling, and psychotherapeutic individual or group sessions. Case management services are provided which supplement and then replace those originally provided by the Citywide case management team. The inpatient services at Denver General Hospital are oriented toward the acute episode with the major focus being symptom reduction and stabilization. Upon admission, each client is assigned to a Citywide case manager and/or to one of the mental health centers so that joint discharge planning can begin immediately. Long term inpatient care is provided by Fort Logan Mental Health Center, a state hospital in Denver, where the average length of stay for patients enrolled in the adult treatment units is 98 days. Servicios de La Raza and Asian Pacific Development Center are speciality clinics serving Hispanic and Asian Pacific citizens ... Each clinic provides day treatment and outpatient counseling to homeless and nonhomeless mentally ill [HMI] individuals. (Wilson 1987 : 12-13) Coordination of substance abuse and mental health services. Despite the traditional separation between the substance abuse and mental health service communities, there appears to be a need now for better coordination. "Farrand colleagues (1986) found that, of homeless people in Los Angeles who had a diagnosis of severe and chronic mental illness, almost half also were chronic substance abusers." (Breakley 1987 : 45) It is estimated that between 20 to 40 percent of .the HMI individuals in the Denver area are either situational or chronic abusers of alcohol and/or drugs. However, a new demonstration program, jointly funded by the Colorado Alcohol and Drug Abuse Division (ADAD) and the Division of Mental Health, offers some hope. The project is housed at Aquarius Center (Arapahoe Mental Health Center) and Arapahoe House and has as its goal the improvement of community support and intensive services

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provided for individuals who have serious mental illness and substance abuse problems. (Wilson 1 987) 62 Breakley summarizes that any transitional custodial care for mentally ill and/ or substance abuse victims is both extensive and costly. He suggests that this care embrace three stages-(1) motivation, (2) treatment, and (3) rehabilitation. In the motivation stage, the person is brought to the point of acknowledging that help is needed. The illness may include a fmancial cost, inconvenience, or discomfort entailed in the therapeutic process. The second stage, acute treatment, may be the easiest. The acute treatment techniques are known, and this phase of treatment can be provided relatively easily. It is the third stage, rehabilitation, that can present the greatest problems. In many cases, homeless mentally ill persons or substance have long histories of maladaptive living and have developed entrenched lifestyles on the street. Acquiring new habits is necessary if the person is to adapt successfully to a healthier lifestyle. This can take a long time. In some cases, indefinite plans must be made for support, rehabilitation, and housing. (Breakley 1987) Generic Transitional Cost Considerations This section examines additional cost considerations that apply to many transitional homeless assistance efforts and to some emergency service programs. As evidenced by the extensive nature of transitional custodial care and economic rehabilitation efforts, their particular program costs can be exorbitant. Service delivery

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63 coordination must be a consideration to reduce the program costs tit assisting the homeless. Transportation needs constitute another significant cost consideration. Many, if not most, homeless do not have transportation; yet, they need to access many programs, agencies, and services etc., to achieve custodial care or economic rehabilitation. The Denver Department of Social Services (DDSS) has recently initiated an innovative homeless transportation system 7 which involves a five-day per week, forty-four passenger bus. This bus transports homeless persons between the emergency night shelters and Denver's day shelters and can deliver persons to Denver General Hospital, the Stout St. Clinic, and Warren Village for day-care services. Twice a week it takes homeless persons to DDSS and back. There are also approximately five light trucks and vans owned by various shelters which daily meet a multitude of shelter-and-homeless-person transportation needs involving goods, service delivery, and emergency response. DDSS supplements the Denver emergency shelters and many of Denver's transitional facilities with a supply of bus tokens and cab vouchers for a variety of intermittent individual trips. The yearly DDSS transportation system alone costs about $20,000 and it meets only the most fundamental needs. The Curtis Park Community Center and Warren Village offer additional day-care transportation for homeless 7 The author conceived, developed, and manages this transportation system. Mr. Schroer is the City and County of Denver's Emergency Shelter Grant Program administrator. The DDSS transportation system was created in response to a homeless assistance needs assessment performed in October, 1987.

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64 families and the yearly cost for this totals about $20,000. DDSS has identified additional transportation needs which could be fulfilled by its transportation system that would require another $20,000 annually. A combination of additional funds for transportation at specific emergency service and transitional homeless facilities and extra DDSS transportation system financial backing from public or private, sources may be necessary to achieve homeless assistance goals. Another cost reduction consideration for homeless assistance programs is the opportunity for public and private financial and material donations. These donations can significantly influence a public, private, or non-profit homeless service provider to develop specific homeless services and facilities. For example, earlier in this thesis, it was described how donated buildings affected the cost-effectiveness of emergency shelter supply options._ For transitional homeless assistance efforts to succeed, the various subprograms they depend on e.g., counseling, income maintenance programs, day-care, etc., must also be effective. If these programs are mismanaged or inept in delivering services, they will increase transitional homeless assistance costs and perhaps even prevent transitional homeless assistance goal fulfillment. Case management services also enhance a successful execution of homeless assistance programs. "A case manager is someone who guides a person in crisis to the appropriate services to address the immediate emergency and prevent future Crisis." (Kaufman 1986: 338) The essential elements of case management

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65 include-client identification and outreach, client assessment and service planning, linkage to necessary support services, and client advocacy: Many homeless persons require personal attention in order to make the transition from the streets to a position of economic and social rehabilitation or stable custodial care. However, the staff costs that support case management services can be substantial. Finally, there may be no more important transitional homeless assistance support service than specialized housing. Each of the six homeless sub populations has unique housing/ shelter needs during the transitional period. For example, the special psychological and counseling needs of battered women necessitate separate facilities to enhance the rehabilitation of these victimized women. Optimally, separate housing/sheltering facilities should be established for each of the six homeless subpopulations to enhance transitional assistance efforts. Particular service needs call for these separate and often specially designed facilities. Preventive Homeless Assistance Cost Considerations Primary and secondary preventive homeless assistance program costs can be significant. "Homelessness is a costly social problem. It is only costly, however, if we allow it to continue to expand and increase in scope ... Money will help only if it is focused on the causes of homelessness and long-term solutions." (Kaufman 1986: 344-345) Kaufman may be understating the effectiveness of public, private, and nonprofit financial resources applied to emergency service and transitional homeless assistance, but there

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66 is no doubt preventive homeless assistance investments, particularly secondary prevention programs, can be most beneficial. Chapter IV of this thesis listed principal primary and secondary preventive homeless assistance housing programs and policies. A cost-effectiveness analysis should be performed from among these options. It is estimated 3.5 million low-income people in the U. S. cannot now fmd affordable housing. The number of Americans requiring low-income housing but unable to find it will grow to nearly 19 million by the year 2003 if current trends continue, which will potentially swell the ranks of the homeless living on city streets, according to a study commissioned by the Neighborhood Reinvestment Corporation and the Massachusetts Institute of Technology. (The Denver Post November 11, 1987) Even though affordable housing needs for low-income persons may supercede other needs, additional preventive assistance can be applied to the six homeless assistance subpopulations. For example, the Colorado Children's Campaign has identified the following specific preventive measures to mitigate the number of homeless families: Two Parent Families Reinstate AFDC-U so that impoverished two-parent families need not be faced with the choice of separating to receive assistance or becoming homeless. Tie two-parent income assistance programs to work expectations, recognizing that in many of these families the mother has traditionally stayed home to care for children while the father works.

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Single Parent Families Increase AFDC to single mothers so that it is adequate to meet the cost of basic rent, food, and other necessities. 67 Provide remedial education, job search, and job training assistance to homeless single parents to increase their earning capacity above poverty. Recognize child support as an untapped source of income assistance for single mothers caring for children. (Gould 1987 : 14-15) These specific family-oriented, preventive homeless assistance strategies point out the fundamental importance of a healthy economy and an effective public welfare and assistance program network to combat homelessness.

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CHAPTER VI ADDITIONAL CBA CONSIDERATIONS/SOCIAL IMPACT ANALYSIS Additional considerations, such as political and administrative influences, affect homeless assistance goals and programs. There are also other special economic considerations which affect these goals and programs. These influences and considerations usually cannot be or are not included in the homeless assistance quantitative analysis. Political and administrative influences must be examined since they may determine if the various homeless assistance goals and programs can even be reached .. Homeless assistance programs may be cost-effective and achieving certain homeless assistance goals may be efficient, but unless the political and administrative environments are sufficiently propitious, they may not be executed or reached. Major political, administrative, and economic considerations which must be examined by the CBA analyst are reviewed below. This chapter concludes with a review of the concems within the homeless assistance CBA's social impact analysis. Additional Public Assistance Programs Chapters IV and V of this thesis discussed the importance of the various public assistance programs upon which homeless persons depend. 1 If these programs are mismanaged, insufficiently

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69 funded, or not timely in delivering benefits to homeless persons in crises, emergency service and transitional homeless assistance goals may not be reached. Homelessness is a complex problem that cuts across the usual categories of social services and usually can involve most of the traditional local, state, and federal public assistance and in-kind benefit programs. The CBA analyst must assess the health of these programs and determine if they will present administrative and cost barriers to the fulfillment of homeless assistance goals. Economic Conditions Transitional and preventive homeless assistance goal achievement will depend upon the performance of the local and national economy in two vital areas-job availability and affordable housing. Transitional homeless assistance directed at economic rehabilitation will be stymied if jobs are not available or are poor paying. Mfordable low-cost housing may be the key economic condition preventing homelessness. Transitional homeless assistance programs depend on specialized housing/ shelter facilities to enhance successful execution. The CBA analyst should perform a special study of the local housing market, opportunities and resources for additional low-cost housing supply, and other factors (such as rent control) which may affect the cost of housing. Mfordable housing for poor individuals and families combined with gainful employment may be the best two remedies for preventing homelessness.

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70 Stewart McKinney Homeless Assistance Act The Stewart McKinney Homeless Assistance Act has provided $355 million nationally to combat homelessness. About $2.2 million of this funding pot will reach Colorado. Each of the three primary homeless assistance goal areas is addressed by the Act. Stewart McKinney funds are designated for emergency shelter support, transitional housing, permanent handicapped housing, supplemental assistance, Section 8 assistance/SRO, adult education, and job training for homeless. The availability of these funds will somewhat mitigate the need to perforril a homeless assistance CBA since the federal government is footing much of the bill for broad program areas it deems critical. However, the homeless assistance CBA can also still assist local homeless programs officials select the most efficient specific homeless assistance programs to be funded by Stewart McKinney. This federally financed homeless assistance depends on administration through state and local governments and private, nonprofit groups. The CBA also can help allocate precious resources among the homeless assistance goals and programs not supported by Stewart McKinney. The homeless assistance CBA analyst should review the current status of government homeless assistance funding. Social Impact Analysis The CBA analyst must consider if there is an equitable distribution of homeless assistance benefits and costs as a result of fulfilling the primary homeless assistance goals. Knowledge of this

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distribution will assist the analyst to suggest an equitable funding plan from among the public, private, and nonprofit sectors. To begin, it is appropriate to consider the proper level of financial support from the local, state, and federal governments. 71 Since each local public good [homeless assistance] has an optimal number of users, or covers an optimal geographic area, one can imagine in theory an optimal constitution, or prefect mapping of functions as Bretan (1965) has called it, that assigns responsibility for provision of such public goods to the appropriate level of government representing only those persons affected. (Boadway and Wildasin 1984 : 501) In practice, this neat assignment of responsibility between levels of govemment breaks down when considering homeless assistance fmancial support. First of all, there is virtually no information in Denver which crystalizes the source and cause of the city's homeless population. There is no certainty as to where Denver's homeless come from. Perhaps the homeless population study now being developed by researchers at the University of Colorado at Denver and staff from the Colorado Coalition for the Homeless and the Denver Department of Social Services will shed more light on these critical concerns. Determination of homeless government financial assistance gets even more difficult when one considers the location of the homeless community. The central Denver neighborhoods designated in the thesis as the hard-core homeless community developed because of the public, private, and especially nonprofit religious support and facilities available there. In Council District #8, residents and business persons have the most to gain if homeless assistance goals are reached; yet, these residents and

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businesses have not caused the phenomenon of homelessness in their community. The residents and firms in the homeless community would have difficulty in contributing financially to homeless solutions. Median family income in Five Points (one of the homeless community neighborhoods) ranged from $4,813 to $7,572 a year, about a fifth of the 1984 city-wide median income estimate ... two thirds of the household incomes fall below government established 1984 poverty income guidelines. (Rocky Mountain News August 19, 1985) 72 Ladd and Doolittle confirm that the federal government should be the primary financial supporter for programs to assist the poor. Homeless assistance efforts could fit within these poverty programs. This financial support role is given the federal government on the basis of evidence that most Americans would support, through taxes, government programs that help alleviate poverty. Ladd and Doolittle also correctly argue that poverty is a national phenomenon and that its sources and causes exist throughout the country. The sources and causes of homelessness also develop on a national basis. And, they correctly claim that not all state and local governments have the same fiscal ability to contribute to poverty maladies and homeless problems. A shift to more state and local government financial support for poverty and homeless programs would lead to uneven and horizontally inequitable tax burdens across states. Finally, the mobility of poor and non-poor (or homeless and non-homeless) is such that greater state and local government support of poverty and homeless assistance programs could eventually lead to greater concentrations of poor and homeless persons. (Ladd and Doolittle 1982)

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73 A Denver homeless assistance funding plan can be based on the recognition that the federal govemment should supply most of the financial assistance for homeless assistance programs. However, there are no long-term prospects for continued federal homeless assistance. And, Colorado and Denver may wish to exceed federal homeless assistance goals and standards. Hence, it is important that Colorado and Denver determine better the sources and causes of homelessness in order to develop the most equitable homeless assistance funding plan possible. Developing this funding plan should follow the sequence listed below: 1) Maximize efficient use of federal homeless assistance financial support; 2) Complete the local research determining and cause of Denver's homeless population; link these results with other similar local and national studies; 3) Examine the distribution of benefits between Denver, Colorado, and other locations; and 4) Demarcate Denver and state financial responsibility based on the results above. Currently, there is significant voluntruy private and nonprofit financial support for homeless assistance efforts. Since 1985, this support has totaled approximately $9 million or about twice as much as has been contributed by the City and County of Denver in the same period. These contributions are considered efficient since they result in the realization of benefits to the contributors. Because this support is voluntruy, equitable funding arrangements among these private and nonprofit sources is not necessruy. However, clarification as to the sources and causes of Denver's homeless problem may help these private and nonprofit entities

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74 (which include foundations and church denominations) make funding decisions which reflect better the preferences of their members. For example, a church which is predominantly financially supported by Edgewater residents may support homeless programs according to the. number of homeless from this Colorado city.

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CHAPTER VTI CONCLUSION The purpose of this thesis is to suggest a basic CBA framework to examine the costs and benefits of competing homeless assistance goals and programs. Denver's motivation to assist its homeless population has been driven by factors other than economic efficiency. However, as the most politically acceptable, the most necessary, and the most appealing homeless assistance programs, efforts, and services are implemented, public choices will be harder among the remaining homeless assistance measures necessary to maintain and enhance service to this afflicted population. A homeless assistance CBA can lay a rational public policy decision-making foundation so that these remaining measures, once implemented, can reflect an efficient allocation of scarce public resources directed to their highest valued purpose. This CBA analysis can help shield the most efficient homeless assistance measures from political gamesmanship and program mismanagement. It is hoped that this thesis can stimulate a CBA on the primary homeless assistance goals and programs and be of assistance now to other researchers, administrators, or advocates pursUing vital homeless assistance aims. This thesis will be used by its author to guide the establishment of a permanent

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76 implementation, monitoring, and planning responsibility by the City and County of Denver on homeless issues. The author is able to perform this as a result of his job as Resource Coordinator to the Denver Department of Social Services' Homeless Project Unit. This Unit has been given the duty to carry out the homeless lead agency functions assigned to the Denver Department of Social Services by Mayor Federico Peiia. A suggested area for specific future CBA research is to develop some empirical models for the comparison of various transitional homeless assistance goal targets. Emergency homeless service in Denver currently is considered sufficient and adequate. Preventive homeless assistance solutions require national developments. But there is a growing concem from among homeless service providers in Denver that transitional homeless assistance options be expanded. Another area ripe for immediate CBA analysis is a comparison of the costs and benefits of Denver welfare reform programs and one or more homeless goal target(s). A key focus of this analysis is an examination of the coordination of services among welfare reform and homeless assistance providers.

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BIBLIOGRAPHY Alameda County 1987 Homelessness in Alameda County. A plan by the Alameda County Task Force on Homelessness. August, 1987. Oakland, Calif. Allegheny County 1987 Progress Report on Implementation of the Comprehensive Plan to Address the Problem of Homelessness in Pittsburgh and Allegheny County. Office of the Mayor and. Allegheny County. June, 1987. Pittsburgh. Andrews, Richard 1982 "Cost-Benefit Analysis as Regulatory Reform," in CostBenefit Analysis and Environmental Regulations : Politics. Ethics. and Methods, edited by Daniel Swartman, Richard A. Liroff and Kevin G. Crolee : 11015. The ConserVation Foundation, Washington, D.C. Barrett, Thomas; John Abrahamson; Jack Wackwitz; and Mitch Berdie 1986 The Mentally Ill in Jails. Final Report from the Bethesda Community Mental Health Center. May, 1986. Denver. Boadway, Robin W.; David E. Wildasin 1984 Public Sector Economics. Little, Brown and Company. Boston. Breakley, William R. 1987 "Treating the Homeless." Alcohol Health and Research World, Spring: 1987 42-47. Cain, Glen G. 1983 "Evaluating Social Action Programs," in Public Expenditure and Policy Analysis, edited by Robert H. Haveman and Julius Margolis : 207-230. Houghton Miflin, Boston.

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78 Callahan, Alice; Jeff Dietrich; and Gary Blaise 1986 "Comparative Shelter Construction and Operation Cost Estimates," in Housing the Homeless. edited by Jon Erickson and Charles Wilhelm : 363-376. Center for Urban Policy Research, Rutgers. City of Philadelphia 1984 A report on the homeless prepared by the Mayor's Public-Private Task Force on Homelessness. Plan for 1984-85. Office of the Mayor, City of Philadelphia. City of Phoenix 1983 The Homeless of Phoenix: Who Are They? and What Should be Done? A report prepared by the Consortium For the Homeless by Phoenix South Community Mental Health Center :ln conjunction with the St. Vincent de Paul Society and the Salvation Army. June, 1983. Phoenix. City of Seattle 1986 A report on Seattle's homeless prepared by the Office of the Mayor, City of Seattle. December 31, 1986. Seattle. City of Tucson 1985 Neighborhood Emergency Transitioning System Task Force on Homeless Services. Report to the Mayor and City Council. December 16, 1985. Tucson. Collins, Jane 1987 Services Offered Homeless Persons by Denver Department of Health and Hospitals. Memo describing Departmental services to the homeless from its head of clinical social services. OCtober 22, 1987. Culver, Virginia 1987 "Samaritan Shelter Debt Nearly Paid." The Denver Post January 30, 1987. Denver. Due, John; Ann Friedlaender 1981 Government Finance. Economics of the Public Sector. Richard D. Irwin. Flack, Ray 1987 "Church Saves City Money By Sheltering Homeless." The Denver Post January 10, 1987. Denver.

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79 Geier, Ellen H. 1987 "Homeless Action Group Seeks Fair Share Zoning." Washington Park Proftle June, 1987. Denver. Goldman, Howard; Joseph Morrissey 1985 "The Alchemy of Mental Health Policy: Homelessness and the Fourth Cycle of Reform" American Journal of Public Health July 1985. 75(7) : 727-730. Harberger, Arnold C. 1983 "Basic Needs Versus Distributional Weights in Social Cost-Benefit Analysis," in Public Expenditure and Policy Analysis, edited by Robert H. Haveman and Julius Margolis: 230-260. Houghton Miflin, Boston. Haveman, Robert H.; Burton A. Weisbrod 1983 "Defining Benefits of Public Programs : Some Guidance For Policy Analysis," in Public Expenditure and Policy Analysis, edited by Robert H. Haveman and Julius Margolis: 80-105. Houghton Millin, Boston. Hernandez, Santos 1987 "Impact of Warren Village Participation on the Self Sufficiency of One-Parent Low-Income Families. Program Evaluation Report, Executive Summary. Funded by U. S. Department of Health and Human Services. April, 1987. Jackson, Robert 1985 "Ideas for Sheltering Homeless Get Mixed Response for Davis." Rocky Mountain News August 19, 1985. Denver. Jones, Bernie 1987 "A Comparative Analysis of Local Social Planning to Address Homelessness." Draft revision of a paper presented at the 29th Annual Conference of the Association of Collegiate Schools of Planning, Los Angeles, Calif., November 5-8, 1987. 1987 Report of the Homeless Action Group (HAG). A report jointly sponsored by the Office of the Mayor, City and County of Denver, Colorado Coalition for the Homeless, and the Piton Foundation. February, 1987. Denver.

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80 Kaufman, Nancy K. 1986 "Homelessness: A Comprehensive Policy Approach," in Housing the Homeless, edited by Jon Erickson and Charles Wilhelm, Center for Urban Policy Research, Rutgers. Kemper, Peter; David A. Long and Craig Thornton 1983 "A Benefit Cost Analysis of the Supported Work Experiment," in Public Expenditure and Policy Analysis, edited by Robert H. Haveman and Julius Margolis : 230-260. Houghton Millin, Boston. Koegel, Paul 1987 Ethnographic Perspectives on Homeless and Homeless Mentally Ill Women. A report prepared by the National Institute of Mental Health. April, 1987. Ladd, Helen F.; Doolittle, Fred C. 1982 ''Which Level of Govemment Should Assist the Poor?" National Tax Journal, September, 1982, XXXV: 323-335. Mann:, Peter 1987 "Helping and Hating the Homeless." Harper's Magazine. January, 1987: 39-48. Marine, Susan 1987 "A Profile on Poverty in Metropolitan Denver." A report prepared by the Piton Foundation. April, 1987. Denver. 1987 "No Simple Solutions Service Delivecy to the Elderly in Metropolitan Denver." A report funded by the Colorado Trust. September, 1987. Denver. Mattingly, Terry 1987 "Samaritan House, Sanctuary of Hope." Rocky Mountain News November 26, 1987. Denver. Mishan, E. J. 1982 Cost-Benefit Analysis. George Allen and Unwin, London. Morrow-Jones, Hazel A.; Willem van Vilet 1988 A Report on Homelessness in Colorado. Prof. MorrowJones is a faculty member of the Department of Geology, University of Colorado, Boulder.

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8 1 Mowbray, Carol; U. Sue Johnson; and Andrea Solare 1987 "Homelessness in a State Hospital Population." Hospital and Community Psychiatry, August,1 1987 38(8) : 880-882. Nash, Christofer A. 1983 "The Theory of Social Cost Measurement," in Public Expenditure and Policy Analysis. edited by Robert H. Haveman and Julius Margolis: 56-80. Houghton Millin, Boston. Redburn, F. Stevens; Terry F. Buss 1986 Responding to America's Homeless. Praeger Press, New York. Reeder, W. J. 1985 "The Benefits and Costs of the Section 8 Existing Housing Program." Journal of Public Economics, April 1985 26(3): 349-377. Ridgway, Priscilla 1986 Case Management Services for Persons Who Are Homeless and Mentally Ill. Report from an NIMH workshop. The Center For Psychiatric Rehabilitation, Boston University. July, 1986. Boston. Ropers, Richard H.; Richard Boyer 1987 "Homeless as a Health Risk." Alcohol Health and Research World, Spring, 1987: 38-41. Roth, Dee 1984 Homelessness in Ohio :A Study of People in Need. A report prepared by the Ohio Department of Mental Health. November, 1984. Reyes, Lilia 1987 Local Responses to the Needs of Homeless Mentally Ill Persons. A report prepared by the U. S. Conference of Mayors. May, 1987. Washington, D. C. Sachs-Ericsson, Natalie; James A. Ciarlo; Stephen L. Dilts; Dan L. Tweed; and Edmund Casper 1987 Report of Research on the Homeless Mentally Ill in Colorado sponsored jointly by the University of Denver and Denver General Hospital. July 31, 1987. Denver.

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82 Sanjek, Roger 1986 "Federal Housing Programs and Their Impact on Homelessness," in Housing the Homeless, edited by Jon Erickson and Charles Wilhelm: 315-322. Center for Urban Policy Research, Rutgers. Sassone, Peter; William Schaffer 1978 Cost-Benefit Analysis: A Handbook. Academic Press, London. State of Maryland 1986 Homelessness, Recommendations for State Action. A report prepared by the Governor's Advisory Board on the Sl)elter, Nutrition and Service Program for Homeless Persons. November, 1986. Annapolis, Maryland. Sprinkel, Beryl W; Thomas Gale Moore; and Michael L. Mussa 1988 Economic Report of the President and The Annual Report of the Council of Economic Advisers. U. S. Government Printing Office. Washington, D.C. State of Michigan 1986 Life in Transit: Homelessness in Michigan. A Report to the Governor's Human Services Cabinet, Prepared by the Task Force on the Homeless. March, 1986. Lansing, Michigan. Steiner, Peter 0. 1983 "The Public Sector and the Public Interest," in Public Expenditure and Policy Analysis. edited by Robert H. Haveman and Julius Margolis: 3-42. Houghton Millin, Boston. Stone, Lorene H. 1986 "Shelters for Battered Women," in Housing the Homeless. edited by Jon Erickson and Charles Wilhelm : 295-303. Center for Urban Policy Research. Rutgers. Stone, Susan 1987 Breaking the Cycle of Homelessness : The Portland Model. A report prepared by the Office of the Mayor, City of Portland. May, 1987. Portland, Oregon. The Denver Post 1987 "Half of Nation's Homeless May Be Infected by Tuberculosis Bacteria." The Denver Post May 8, 1987. Denver.

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83 The Denver Post 1987 "Major Jump in Homeless Ranks Feared." The Denver Post November 11, 1987. Denver. The Denver Post 1988 "Daily Hospital Costs Increase 16o/o; Colorado Rises to $844.00." The Denver Post January 6, 1988. Denver. Thornton, Craig; David Long; and Charles MaHar 1982 Technical Report Q. A Comparative Evaluation of the :aenefits and Costs of Jobs Corps after Forty-Eight Months of Postprogram Observation. Mathematica Policy Research Inc. October 1982. Princeton, N.J. Tucker, William 1987 "Where Do the Homeless Come From." National Review, September 25, 1987: 32-43. United Way 1987 A report to the United Way of the St. Paul Area on the Recommendations of the Human Development Action Coalition on Long-Term Solutions of Hunger and Homelessness in the Greater St. Paul Metropolitan Area. Hubert H. Humphrey Institute of Public Mfairs. University of Minnesota, May, 1987. Minneapolis, Minnesota. U. S. Department of Housing and Urban Development 1984 A Report to the Secretary on the Homeless and U.S. West Emergency Shelters From the Office of Policy Development and Research, U. S. Department of Housing and Urban Development. May, 1984. Washington, D.C. 1987 Press Packet, Osage Initiatives Project. September, 1987. Weicher, John C. 1984 "Halfway to a Housing Allowance?," in Maintaining the Safe1y Net, edited by John C. Weicher, pp. 92-118. American Enterprise Institute for Public Policy Research, Washington, D.C.

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84 Wilson, Nancy 1987 Mental Health Services Demonstration Grant Application For tlle Homeless Mentally Ill, Stewart McKinney Homeless Assistance Act. Colorado Division of Mental Health. December, 1987. Denver. Wright, James; Janet Knight; Eleanor Weber-Burdin; and Julie Lam 1987 "Ailments and Alcohol Health Status Among the Drinking Homeless." Alcohol Health and Research World, Spring, 1987: 22-27.

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CITY DATA ON HOMELESSNESS PERCENTAGE COMPOSITION OF HOMELESS POPULATION PERCENTAGE INCREASE IN PERCENTAGE ARE PEOPLE DEMAND FOR INCREASE IN SINGLE SINGLE MENTALLY SUBSTANCE TURNED AWAY EMERGENCY SHELTER II OF FAMILIES FAMILIES MEN WOMEN. YOUTH ILL ABUSERS WORKING YES NO (a) BOSTON 10 10 20 65 15 0 32 29 25/10(b) X CHARLESTON 23 144 21 70 3 0 20 30 30 X CHICAGO 7 -40 40 20 0 25 20 30 X CLEVELAND 10 20 13 66 16 5 10 -6 X DETROIT 15 15 40 35 23 2 9(c) 30 -X kANSAS CITY 44 3 43 29 22 6 30 16 35 ll z LOS ANGELES 25 40 30 45 15 10 27 27 .10 X < 0 LOUISVILLE 0 0 15 75 10 0 40 40 10 MINNEAPOLIS 20 --16 80 4 0 40 50 5 X NASHVILLE 23 --18 53 18 11 14 23 28 ll NEW ORLEANS 20 -20 60 10 10 35 30 15 ll ;:J NEll YORK CITY 16 18 63 33 4 0 25 30 -ll ll.. NORFOLK 17 30 35 50 15 0 -----ll 0 PHILADELPHIA 40 66 33 43 24 0 20 60 25 X ll.. PHOENIX 15 10 25 70 5 0 zo 20 20 X Ul PORTLAND 12 15 52 31 12 5 20 60 -X Ul PORTSMOUTH ---60 27 13 0 -----X PROVIDENCE 30 75 65 20 11 4 20 30 20 ll SAINT PAUL 8 2 33 47 20 0 23 30 13 X SALT LAKE CITY 20 20 30 60 10 0 25 30 25 ll SAN ANTONIO. 7 20 30 52 4 14 ----54 ll 0 SAN FRANCISCO 25 -20 45 32 3 45 45 10 X :I: SAN JUAN 35 25 24 53 3 20 50 50 39 X SEATTLE 25 -30 55 10 5 40 40 .30 X TRENTON 15 15 50 35 15 0 10 40 10 ll WASHINGTON, DC 30 40 23 51 26 0 18 --65/ll(b) X (a) Data on homeless youth is of!en not separated from those on single adults. no homeless youth in the cfty. Zero percentage does not necessarily mean that there are (b) 251 single adults; lOS members of families; 651 single adults; 111 members of families. (c) Includes only homeless individuals with documented history of mental illness. Source: U. S. Conference of Mayors Survey performed in December, 1987 and percentage changes observed between December, 1986 to December, 1987.

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APPENDIX B HOMELESS ACTION GROUP (HAG) HOMELESS ASSISTANCE RECOMMENDATIONS (lA) Establish, by ordinance, a right to shelter during cold weather, with the city as the houser of last resort. (2A) Reaffirm the right of all persons to have access to all public places during normal operating hours. (3A) Expand and improve the administration of the Department of Social Services' hotel voucher program. (3B) Add two additional beds in each adult shelter to accommodate homeless youth. (4A) Create a 20-'bed facility for CMI women this winter. (4B) Utilize houses foreclosed on by HUD as transitional housing. (4C) Negotiate with landlords and landlord groups for reduced rents in order to create more transitional housing units. (6A) Create a job development team to work in the shelters. (6B) Open an acute care unit as an alternative to hospitalization and a diversion for CMis who commit misdemeanors. (6C) Provide shelters with funds to establish child care programs. (60) Add seven beds to existing nursing homes for severely dysfunctional substance abusers. (7 A) Open more zoned areas to community-based special residential facilities. (7B) Institute a fair share plan to disperse special residential facilities throughout the city. (SA) Create outreach teams to work with police in locating hard-to-fmd CMis. (9A) Focus the efforts of the Citywide Services program more clearly on the homeless CMI population. (9B) Institute a system of case management and interagency agreements for improving services to homeless alcoholsubstance abusers. (lOA) Create a drop-in center for CMis. (llA) Begin a public education program about the realities of street life and addiction/substance abuse. (lB) Establish by ordinance the right of CMI persons to housing and mental health services.

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(2B) Designate safe, legal outdoor sleeping areas. (3C) Create two hundred new emergency shelter beds. (4D) Develop 30-50 units of transitional housing for persons showing promise of economic stability. (4E) Add fourteen additional beds for long-term, intermediate care for homeless alcohol/substance abusers. 87 (SA) Establish a state rental assistance program and more Section 8 vouchers. (5B) Develop adequate capitalization of the Housing Trust Fund. (6D) Expand publicly funded substance abuse programs. (6E) Create crisis stabilization facilities for decompensating CMis. (6F) Conduct an annual assessment to see if additional nonhospital detoxification and emergency patrol services are needed. (6G) Increase the Alcohol and Drug Abuse Division's hospitalization capacity for complicated withdrawal cases. (6H) Open a domiciliary facility for substance abusers who don't respond to treatment or have organic-brain syndrome. (6J) Provide an assortment of supportive services for the homeless alcohol/substance abusers. (6L) Establish a toxic vapor abuse program. (6M) Assure free medical care for all homeless persons at the state level. (6N) Start up support groups for CMis in board and care homes as a preventive measure. (8B-8D) Hire two outreach/case management staff to work with the mental health system to locate the elderly homeless. (9C) Set up cross-training programs for shelter operators and detox facility staffs. (9E) Institute long-term case management for the most CMis and those who regularly decompensate. (lOB) Open a drop-in center for youth, offering varied services. (liB) Strengthen the school system-service provider network for problem solving, communication, training, etc. (4F) Expand the number of beds available for alcohol/ substance abusers jn halfway houses. (4G) Develop a model transitional housing project for eight-to-ten elderly homeless. (5C) Create a series of independent and semi-independent living units for CMI homeless persons. (5D) Adopt a city policy requiring replacement of low income housing units destroyed through any city-subsidized project. (5E) Renovate Single Room Occupant (SRO) hotels as longterm housing.

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88 (5F) Develop assisted-living housing options for the elderly homeless through liberalization of state regulations. (6K) Hire three additional skilled outpatient counselors to care for homeless alcohol/substance abusers. (60) Establish new and expand existing vocational and psychosocial rehabilitation services for CMis. (6P) Promote mobility for homeless persons through gas vouchers, free bus tokens, and free car repair work. (llC) Work with the media to heighten awareness of runaway /throwaway youth problem. (liD) Create an office of public education about chronic mental illness.

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APPENDIX C TYPES OF SERVICES, FACILITIES, AND PLACES HOMELESS FREQUENT Emergency Shelters Soup lines Streets and Abandon Buildings Safehouses Truck Stops Food Banks Train and Bus Stations Jail Psychiabrtc Facilities Social Services Referral Services Agencies Church Basements Emergency Assistance Agencies Alcohol Abuse Facilities Other Employment Services VA Outreach Programs training National Forest Land CMI Facilities Railroad Cars Day Centers Transitional Houses SRO's Motels Clothing Banks Hospitals Detoxification Centers Medical clinics Halfway Houses Counseling Services Temporary Employment Overflow Facilities State Employment Services Chemical Abuse Facilities Living Out of Vehicle Osage (employment, jobproject.) Ministerial Alliances Source: Colorado Coalition for the Homeless

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APPENDIX D ST. FRANCIS CENTER NEEDS LIST WARM WINTER CLOTIIING OctApril Men's winter coats Winter gloves Long underwear Winter hats 28-36 LIGHT WEIGHT CLOTIIING MaySept Men's light weight jackets Work gloves Men's caps Men's jeans and work pants, sizes Men's Jeans and work pants, sizes 28-36 Shoes, esp. work boots and tennis shoes Shoes, esp. snow boots and work boots Socks, esp. white tube Socks, esp. white tube Men's underwear, sizes 28-36 Men's underwear, sizes 28-36 PERSONAL ITEMS Bath towels Wash clothes Bar soap Shampoo Shaving cream Spray or pump type deodorant Combs Toothbrushes Ointment and balms Toilet paper Toothpaste Sanitary napkins/tampons Shoe powder/talc Baking soda Band-aids 3 x 5 and regular Gauze pads Hydrogen peroxide Cotton balls MISCELLANEOUS Generic laundry soap Shoe polish, black and brown Books Magazines-National Geographic, Smithsonian, Reader's Digest

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91 Newspaper subscriptions -3 The Denver Post, 3 Rocky Mountain News Envelopes White writing paper Stamps Pens Pencils Good News Version Bibles Coffee cups, six oz. hot cups Jars of generic instant decaffeinated coffee PRIORI1Y NEEDS