Hundreds of formerly homeless people get evicted after L.A. nonprofit fails to pay rent on time
Jesus Mares got a lifeline during the COVID-19 pandemic. Thanks to rental support from one of Los Angeles’ leading homelessness agencies, he had a roof over his head.
He had been bouncing between sleeping in his car and hotel rooms. The taxpayer-subsidized room in a South L.A. duplex provided stability until he could get back on his feet, he’d hoped.
It went well for a while, he said. Then Mares quickly noticed things were amiss with the nonprofit, known as HOPICS. He went through several case managers who Mares said didn’t come to see him.
Then came the eviction notice. HOPICS, which has received about $140 million in Los Angeles city, county, state and federal funding over the last three years for a program known as rapid re-housing, was months behind on paying his rent, according to Mares and his former landlord.
“They basically told us to get out of the building and they locked the building up,” Mares said.
All together 306 people lost taxpayer-funded homes in South Los Angeles as a result of HOPICS’ failure to pay rent on time, the nonprofit said. While more than half were then placed in permanent housing or sent to temporary sites, HOPICS and Los Angeles housing authorities did not say what happened to 119 people.
A CalMatters review of the program, based on hundreds of pages of documents and dozens of interviews, shows that the prominent Los Angeles nonprofit repeatedly ignored explicit eviction warnings from some landlords, did little to vet the middlemen it entrusted to execute the program, and took on far more clients than its case managers could serve.
CalMatters interviewed three participants who landlords said were evicted from HOPICS-funded houses, and they reported ending up back on the streets or living in their cars.
The eviction mess underscores weaknesses in California’s strategy for addressing its biggest crisis, homelessness. Gov. Gavin Newsom’s administration has allocated more than $20 billion to fight homelessness, but the state’s homeless population surpassed 170,000 people in 2022. Like HOPICS, many government-funded services provide only temporary housing, depend on too few case workers and must compete for units in an already-tight rental market.
Leaders of the nonprofit, whose formal name is Homeless Outreach Program Integrated Care System, say they were overwhelmed by the sudden influx of emergency COVID money during the pandemic to run what’s known as rapid re-housing, a popular local rental assistance program.
To execute the program, HOPICS used middlemen – many of which were newly created nonprofits – to rent out rooms to the unhoused. However, HOPICS’ leaders often didn’t pay those brokers on time, they say, because they needed to review and approve rent bills sent by the very landlords they had chosen to work with. Some of the invoices, they say, had questionable charges.
“We didn’t have the habit of Google searching everybody’s names, and probably that’s a simple fix,” said HOPICS deputy director and former U.S. Rep. Katie Hill. “This is a lot of money that has gone towards a program that has shown that it can house a lot of people. It’s not perfect in any way, shape, or form, and it’s evolving, and we’re learning as we go.”
The federal government sent $100 million in emergency aid to Los Angeles County to address the homelessness crisis during the pandemic, along with another $220 million to six cities in the region including L.A. The Los Angeles Homeless Services Authority then turned to organizations like HOPICS, which is a division of a larger LA nonprofit, Special Service for Groups, to carry out the programs. Between 2019 and 2023, HOPICS placed 3,100 homeless people into permanent housing through rapid rehousing programs, according to the nonprofit.
Annual revenues at Special Service for Groups surged from $84 million in 2018 before the pandemic to $149.1 million in 2022. It also gets rapid re-housing funding from Measure H, the 2017 Los Angeles County sales tax and a mix of federal, state and city funds.
While the rush of COVID funding has ended, HOPICS continues to deal with the fallout of the evictions. It still hasn’t paid all of the rent the landlords claim they are owed, it acknowledges. And, separately, three Los Angeles motels sued HOPICS and its parent late last year, alleging it stopped paying rent for clients who were living at the motels. The nonprofit settled the case early this year, though the terms weren’t disclosed.
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