Public cost of homelessness projected to skyrocket

Homelessness could cost Southern Nevada as much as $1.1 billion annually within 20 years, the Las Vegas City Council was told Wednesday.

“We think the problem is going to get worse,” said Jeremy Aguero of Applied Analysis. “The cost of housing is becoming more challenging. Our population continues to grow and the demand for services continues to increase.”

A report Aguero presented estimates Clark County as a whole spends about $26,000 per person experiencing homelessness, at a cost of about $369 million in 2019. Interviewed after the council meeting, Aguero said the rising costs of homeless services, along with a potential increase to the homeless population, could result in the billion dollar estimate. 

The report indicated that jails, hospitals, social services and shelters add to the overall public costs of homelessness, though there wasn’t any specific breakdown on each service cost. Aguero said while it’s known those services factor into the high costs of homelessness, specific data is complicated to track.  

The report noted it drew on other localized studies that “have been conducted in an attempt to quantify these costs in jurisdictions throughout the country.”

“In general, the costs of homelessness involve social services, housing, policing, incarceration and medical treatment, but the studies varied in the types of costs they tracked and estimated,” according to the report. 

Aguero was contracted by the city for $33,250 to conduct the study. 

“The reason we commissioned this study is because we’re in the process of updating our homeless services strategy and affordable housing strategy, which we intend to bring to the council with some options so you can make some policy decisions,” Kathi Thomas-Gibson, director of community services, told the council. 

The analysis estimated homelessness is expected to rise over the next two decades to about 28,000 despite recent reported decreases. The 2019 Southern Nevada Homeless Census estimates 14,000 people would experience homelessness this year, with 5,530 on any given night, which is down from 16,600 the previous year.

The report didn’t differentiate between types of homelessness such as chronic homelessness, which are those who experienced homelessness for at least one year, have had more than four episodes of homelessness in three years and also have a disabling condition. Chronic homelessness, which increased 19 percent from 2018, costs an estimated $73,000 a year according to homeless outreach experts.

Though it wasn’t quantified, Aguero also noted another cost includes businesses opting out of relocating to downtown Las Vegas. “The presence of social service issues has the potential to deter private investment, which ultimately has the potential to be counter productive to economic development efforts taking place,” according to the report.  

Aguero’s report mirrored some of the conclusions the homeless census gave for the causes of homelessness, such as the lack of affordable housing and rising rents. Aguero also factored in Clark County’s poverty rate, cost of living, population growth and mortgage default and foreclosure rates as contributing to the rates of homelessness.  

“Homelessness is the symptom, not the virus,” Aguero said. “Homelessness tends to be highly related to how the economy is performing.”

Nevada still ranks among the top eight cities with the highest rate of homelessness per capita. 

Thomas Gibson said the city’s focus has been on the Homeless Courtyard Resource Center and crisis housing interventions. 

Lisa Morris Hibbler, the Chief Community Services Officer with the city, added the Clark County Commission has also been focusing on homelessness and long-term approaches. “We pretty much have the two ends of the continuum,” she said. “What we have to do is try to bridge that middle.”

On Sept. 4, the County Commission voted to increase the sales tax by one-eighth of a cent, which is estimated to generate $54 million that could go to a variety of issues including homeless services or affordable housing projects. Hibbler said that money could go to programs that help bridge the gaps.  

She also said Assembly Bill 79, which requires municipalities to work together to develop a regional strategy, will give each government a chance to collaborate on projects and look at sources of funding.

The legislation, originally proposed by the city, would have allowed them to generate revenue for homeless services by increasing the real property tax and a sewer surcharge. However, the bill was gutted at the last minute and now requires the creation of a regional strategy to respond to homelessness, including determining funding sources.

Mayor Carolyn Goodman stressed state lawmakers have a role to play when it comes to addressing homelessness.

“We are only one in four states that doesn’t meet annually,” she said. “We need to be able to get in front of the lawmaking body in order to get funding.”