Emergency Shelter Grant Program

Abt Associates evaluated the Emergency Shelter Grant Program by examining the organizations involved in the program, how program activities were implemented, and their impacts. The study's findings are based on the activities of 382 grantees and the 3,000 to 3,500 service providers who received ESG funds between 1987 and 1991. Of 382 grantees surveyed, 234 responses were received. Of 3,000 to 3,500 service providers surveyed, 651 responses were received. Indepth information was gained from respondees, including both shelter and nonshelter providers, through study visits to 15 sites.

PROGRAM DESCRIPTION AND ADMINISTRATION

Created in 1986, ESG provides formula funding to entitlement jurisdictions for a broad range of eligible activities. These activities include conversion, renovation, and rehabilitation of facilities; operation of facilities; delivery of essential services; and homelessness prevention. ESG funding has enabled service providers to expand available emergency shelter capacity to broaden the range of services available to clients.

Those eligible to receive funding are States, Territories, metropolitan cities and urban counties, and Indian tribes. These grantees are in turn authorized to reallocate funds to either government or nonprofit agencies that may deliver services directly. While States are required to distribute their entire allotment to local government, local governments receiving entitlement funds may distribute all or a portion of their ESG funds to nonprofit homeless provider organizations.

From FY87 through FY91, nearly 400 grantees received ESG funding. Most awards went to metropolitan central cities (50 percent), followed by urban counties (28 percent). An estimated 3,000 to 3,500 providers are funded by grantees. A wide variety of agencies and organizations may receive ESG funding to support delivery of services for clients who are either homeless or at risk of losing their permanent housing. Among all ESG-funded providers, the majority (89 percent) are private, nonprofit entities, generally well- established organizations that average 17 years' experience.

ESG-funded entities may be either shelter or nonshelter providers. In FY91, 82 percent of ESG- funded service providers were shelters. ESG-funded providers that offered nonshelter facilities sponsored health care and substance abuse treatment centers, served meals, and provided counseling. While some of these grantees and providers have access to substantial non-Federal resources for their programs, most rely heavily on ESG and other Federal initiatives such as those established by the McKinney Act.

PROGRAM IMPLEMENTATION, FUNDING, COSTS, AND ACRIVITIES

From FY87 to FY91, the ESG program distributed $277.8 million to nearly 400 grantee jurisdictions that was distributed as follows: $99.1 million (36 percent) for conversion, renovation, and rehabilitation of facilities; $129.9 million (47 percent) for shelter operation; $37 million (13 percent) for services; and $9.8 million (4 percent) for homelessness prevention.

The average ESG award in FY91 to a provider agency was $20,592, which represented, on average, 5 to 10 percent of a provider's operating budget. The requirement for a dollar-for-dollar match enabled many ESG providers to aggressively leverage other funding to produce a 1:10 match. This they did by tapping a combination of other Federal funding, State and local government sources, and private and foundation support. The total Federal contribution to an ESG-provider's budget, including ESG, averaged 30 percent, making Federal support one of the more significant factors influencing the emergency amelioration of homelessness. In the 26 States where State appropriations were available, State funding averaged approximately 20 percent; local county or city funding averaged 10 percent; and private funding from corporations, foundations, and religious organizations averaged approximately 30 percent.

Providers implemented their programs following ESG-eligible activity guidelines as follows:

CAPITAL IMPROVEMENTS

• One-fifth of all ESG-funded providers (21 percent), used their funds for physical improvements. Improvements included interior remodeling, plumbing, structural and electrical work, building and health code work, HVAC, painting, and improved safety for children.
• Among providers using ESG funding for physical improvements, ESG funds accounted for roughly 50 percent of the cumulative spending for capital investment and made available an estimated 7,700 additional beds nationwide. By FY91, spending for capital improvements had diminished to 20 percent of all ESG funds.
• Physical improvements were generally completed within the 2-year draw-down period allowed by ESG guidelines. Projects that did experience delays, however, identified the causes as contractor-related procurement and bidding delays, a lengthy environmental review process, or excessive documentation.

ESSENTIAL SERVICES

• ESG funding supported expansion of supportive services at emergency shelters. Ninety-one percent of the grantees reported that they had expanded social services to their clients, and 63 percent reported a reduction in the number of underserved or unserved homeless individuals and families. In addition, numerous providers indicated that the flexibility of ESG funding was an excellent source of leverage and an advantage in meeting the needs of their local homeless populations.
• More than 80 percent of all providers that received ESG funds required case management of their clients as a condition for permitting individuals and families to remain within a shelter.
• The most common form of assistance, offered by more than 90 percent of the providers, was help in obtaining benefits and permanent housing. This was closely followed by assistance in daily living skills, such as money management (86.2 percent), transportation (79.1 percent), support groups (78.6 percent), and job referrals (69.8 percent). Providers also offered assistance designed to help homeless individuals and families move from a shelter environment into transitional and permanent housing.
• Nearly 60 percent of providers reported that as a result of ESG support, they were able to increase service capacity and expand and intensify their intervention services. Added services have included education and training, child-related and housing-related services, and expansion of case management and coordination strategies. Other commonly offered services included child care, GED preparation, vocational counseling, intervention and treatment services for substance abuse, medical care, and psychological counseling.

HOMELESSNESS PREVENTION

• After homeless prevention was added as an eligible activity in 1989, 82.4 percent of providers surveyed by Abt Associates in 1991 were using ESG funds to forestall or eliminate the loss of permanent housing. Concomitantly, 77.5 percent of providers surveyed were using prevention grants to resettle homeless persons into permanent housing.
• Specific preventive assistance included delinquent rental and utility payment assistance, security deposit payments, and landlord/tenant mediation.
• Homelessness prevention efforts tended to be carried out by the larger social service agencies or community action organizations.

OPERATIONS

• ESG funding for day-to-day operations has remained relatively constant since the program was initiated, with between 47 and 52 percent of the total ESG allotment going to operations each year.
• Staff costs were a substantial portion of operating costs. Two trends that accounted for increased staff costs were the emerging emphasis on case management and the expanding range and intensity of services being offered to clients, with the expectation that the effects of these services would provide positive and long-lasting effects for clients.

Although the ESG contribution to a provider's budget is modest, if it is used in combination with other Federal funding, including Community Development Block Grants and Supportive Housing Demonstration Program funds, the impact can be appreciable. Because $99 million of capital investment between FY87 and FY91 represented roughly 50 percent of the cumulative capital investment of providers surveyed for the Abt Associates study, the ESG program has been particularly instrumental in increasing shelter capacity. Ninety-one percent of grantees reported an increase in the number of shelter beds in their localities since FY87.

In less tangible ways, ESG funding has also enhanced the quality of the shelter space by allowing the addition of children's safety features, play yards, common rooms, handicapped accessibility features, and security provisions. Between 70 and 90 percent of all grantees indicated qualitative improvements related to specific quality improvements such as improved habitability, increased security, and other benefits.

Providers' use of ESG funding has shifted over time, however. Whereas funding for capital improvements amounted to more than half the total in each of the first 3 years, by FY91 it accounted for only 20 percent. Funding for essential services increased from 11 percent in FY87 to 21 percent in FY91. Among the types of services showing the greatest growth have been child care; support groups; basic skills development, such as budget management; and counseling and treatment for medical or psychological conditions or substance abuse. Moreover, after FY89, when homelessness prevention became an allowable activity, prevention programs for individuals and families at risk of losing their housing accounted for nearly 10 percent of the total spending of ESG funding in FY89. By FY91 providers were allowed to use up to 30 percent of their ESG grant money to prevent homelessness.

Changes in funding allocated to different activities occur where sponsors recognize the need for more than "two hots and a cot." Other critical factors include changes in spending ceilings and the expansion of eligible categories to reflect an emerging emphasis on supporting the range of interventions necessary to resolve homelessness.

IMPACTS ON POPULATIONS SERVED

Estimates indicate that ESG-funded shelter providers and nonshelter services providers served 2.8 million individuals and 1.1 million families in 1 year. The populations include the homeless and nonhomeless persons threatened with becoming homeless and in need of prevention or other emergency assistance. Services included providing nighttime shelter or, in nonshelter instances, helping in the form of a meal, counseling, or assisting with enrolling for entitlements. Of these, some 205,000 individuals and 65,000 families were placed or kept in permanent housing with the help of ESG-supported services.

Shelters and other homeless service providers that received ESG funds in FY91, served a broad range of the homeless population. The ESG program was not designed to target particular groups of homeless individuals or families. One of its strengths lay in its flexibility, which allowed it to serve a broad range of the homeless population.

ESG-funded providers constitute a mix of shelters and other service agencies. About 82 percent of ESG-funded providers are shelters, and of those more than three-quarters are 24-hour shelters combining overnight facilities with day programs. ESG-funded shelter and nonshelter providers targeted and served homeless individuals and families in somewhat different ways, with homeless-service agencies tending to serve a more diverse population. Shelter providers focused on providing bed space and meals with a secondary, but not necessarily less important, emphasis on provision of comprehensive onsite services.

Nonshelter providers did not offer any form of housing, but instead provided a range of support services that often included housing information and referrals to health care facilities, counseling agencies, residential treatment facilities, and child care centers.

Some ESG-supported providers did tailor their programs to specific populations. Homeless families were the most frequently accepted. Eighty-five percent of the programs accepted families in FY91, and approximately half of all providers reported that they also offered services to battered women and drug- and alcohol-dependent clients. The elderly, physically disabled, veterans, and HIV-positive clients were also relatively well served, with between 37 and 42 percent of all providers offering assistance. Only 31 percent of all shelters and 34 percent of nonshelter providers accepted single young men under the age of 18. Many in this group were restricted to day-only shelters and were forced back onto the streets at night.

After homelessness prevention became an eligible ESG activity in 1989, grantees who employed homelessness prevention strategies reported they were able to assist nearly 35,000 households at an average cost per case of $196.33 in FY91.

Of most importance is whether ESG program funds are making a difference. The answer is yes. From initial intervention to helping individuals and families move into transitional or permanent housing, ESG program funds are helping to lift people out of the abyss of homelessness.