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Denver: Rethinking Solutions for Ending Homelessness

In the metro-Denver region, many of the 1,085 people experiencing chronic homelessness suffer from alcohol or drug abuse, mental illness, or another disability. Each year, Denver spends $7 million on public safety and health care costs for just 250 chronically homeless individuals. Through an initiative that began in February 2016 to improve stable housing and decrease jail time, Denver aims to disrupt the cycle of jail, detox services, shelters, and emergency room visits for 250 frequent users of those services by providing them with stable housing immediately, supplemented by case management and provision of other services. GovEx works with cities to use evidence-based practices, and based on our knowledge of what works, Denver’s model of rethinking partnerships and financing to address longstanding challenges like homelessness is exemplary.

Denver is investing in evidence-based policies

Ending chronic homelessness by providing housing is the theory behind Housing First, an evidence-based policy that has already shown promising results in Denver. 98 percent (39/40) of qualifying participants were stably housed for 12,457 days, according to an October 2017 assessment by Urban Institute. Sarah Gillespie, Senior Research Associate who co-authored the Urban Institute study, notes: “The program’s early results show that participants are getting housed and staying housed. These are important milestones and we look forward to continuing the evaluation and measuring the impact supportive housing has on participants’ jail bed days and other outcomes.”

Housing First has been proven through experimental design to lead to positive outcomes in residential stability, and use and cost of supportive services. Since Housing First began in New York City in 1992, it has been implemented in over 100 sites around the world. The model provides housing in conjunction with treatment and services such as substance abuse treatment, referrals to food resources, transportation assistance, psychiatric services, and others.

The wraparound services are delivered through the Assertive Community Treatment (ACT) model, another evidence-based practice which has proven to show positive outcomes for participants over long periods of time. Denver uses a modified model of ACT, in which a team of case managers, nurses, psychiatrists and other service providers work together to support residents in basic functions like grocery shopping, and more complex challenges like navigating health care systems.

This approach is not new in Denver —  the City has embraced Housing First for more than a decade, and began implementing the model in 2005 with partners like Colorado Coalition for the Homeless (CCH). CCH, which provides housing, health care and supportive services for people experiencing chronic homelessness in Denver, has found success with the Housing First and ACT models. According to a 2006 evaluation of outcomes for the 200 people served through Housing First, 77 percent of those entering the program continued to be housed in the program after two years, 50 percent of participants had documented improvements in their health status and 43 percent had improved mental health status. The program also resulted in emergency cost savings of $31,545 per person.

Denver’s program originated from conversations about criminal justice

Denver’s 2016 Housing First program has roots in Denver’s Crime Prevention and Control Commission (DCPCC), which then-Mayor Hickenlooper launched in 2005 to coincide with the opening of the City’s new detention center. The CPCC was charged with finding ways to decrease the incarcerated population, after judges noticed that they recognized the faces, background and stories of people experiencing homelessness who returned to jail repeatedly. DCPCC analyzed utilization data for the top 300 users of criminal justice and homelessness services, and recognized that they were using jails, emergency rooms and detox centers at “very high rates.”

By analyzing data on frequent users, Denver was able to illustrate the cost of continuing the status quo, and galvanize stakeholders to take a comprehensive approach to solving homelessness for a particular group of individuals. The City built a coalition comprised of health providers, housing authorities, housing developers, and the criminal justice system to develop a strategy for this group to focus aligning resources with interventions that would prevent homelessness.

Denver identified sources of funding beyond federal grants

In 18 months, Denver began construction on two new buildings and and identified 40 scattered-site units, thanks to funding leveraged from the City and State for capital construction and housing services. Housing is paired with wraparound services that are financed through a Social Impact Bond (SIB), a financing arrangement in which investors from the banking and nonprofit sectors committed $8.6M over 5 years to improve outcomes and save costs.

Today, Denver Mayor Michael Hancock’s leadership and decision to prioritize and fund an evidence-based solution to chronic homelessness is paying off. In accordance with the contract, in October 2017 the City made its first payment of $188,349.84 to investors, — $15.12 per day day for each of the 12,457 days of stable housing. Under the contract, the City makes payments only if performance goals to increase stable housing and reduce jail time are met. Due to the success of the program, in his 2018 budget, Mayor Hancock dedicated $670,000 to develop 100 additional permanent supportive housing units, expanding the capacity of the program to 350 units. In his budget statement, Mayor Hancock stated “A city’s budget should reflect the priorities and values of its people, and my 2018 spending proposal does just that.”

Recommendations and resources

For other cities that are interested in addressing these issues, Denver can serve as a roadmap on how to gather and analyze data to target the high-need population; collaborate with partners from multiple sectors; identify funding from diverse and non-traditional sources; and set goals and demonstrate progress incrementally. According to Tyler Jaeckel, a fellow with Harvard Kennedy School’s Government Performance Lab, who coordinates Denver’s program,

once the program demonstrates that progress can be made, it’s time to have a larger conversation about how to expand and build upon these targeted approaches.

For resources on implementing Housing First in your city, please see United States Interagency Council on Homelessness and Pathways’ training page. For information on implementing ACT, see the Substance Abuse and Mental Health Services Administration Toolkit. For recommendations on addressing behavioral health, please see this piece by The Harvard Kennedy School Government Performance Lab (GPL).

Note: GPL provided pro bono technical assistance on the development of the SIB.

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