That’s the term County Supervisor Lindsey Horvath used to describe the situation at the Los Angeles Homeless Services Authority (LAHSA) after a scathing new audit.
“We cannot accept this dysfunction any longer,” she added.
The independent review was commissioned by U.S. District Judge David O. Carter and released to the public Thursday. It found a lack of oversight and clarity in LAHSA’s contracts with vendors, which have made the agency vulnerable to waste, fraud, and abuse.
LAHSA often makes payments to contractors without verifying the services are completed, the audit revealed. The probe found “a high level of noncompliance" among the contracts it was able to review.
There were also problems with the agency’s collection and maintenance of data, which has jeopardized equitable distribution of services. Due to the lack of information collected and provided by LAHSA, the auditors were unable to track progress for approximately $2.3 billion in city spending.
“Such gaps in documentation complicated efforts to track expenditures comprehensively, highlighting the need for more accurate recordkeeping within LAHSA’s financial and performance oversight processes,” the report’s executive summary said.
The report concluded that the City of L.A. would be better off contracting directly with service providers. Currently, the city indirectly contracts with providers through LAHSA. This fiscal year, the city is scheduled to send another $306 million to the agency.
Reactions
Horvath will push for a motion that would remove county funding from LAHSA. She wants to create a new county department to handle homeless services.
City Councilmember Monica Rodriguez introduced a similar motion in November to cut the city’s ties with the agency. She said the new audit validates the concerns she has been raising about the agency for some time.
“It’s long overdue that we implement uniform data standards and real-time oversight to ensure accountability,” said Councilmember Ysabel Jurado, who represents Skid Row. “Every dollar spent on homelessness services needs to be accounted for and contribute to real, measurable improvements in the lives of our unhoused neighbors.”
Mayor Karen Bass has resisted efforts to pull city funds away from LAHSA. Nevertheless, she acknowledged “the broken system” revealed by the latest audit, and said she has been “fighting against” it since she took office.
“These findings are not just troubling — they are deadly,” said attorney Elizabeth Mitchell, who represented the L.A. Alliance for Human Rights in its 2020 lawsuit against the city and county over homelessness. “The failure of financial integrity, programmatic oversight, and total dysfunction of the system has resulted in devastation on the streets, impacting both housed and unhoused.
“Billions have been squandered on ineffective bureaucracy while lives are lost daily. This is not just mismanagement; it is a moral failure.”
In a statement, LAHSA blamed the “siloed and fragmented nature of our region’s homeless response for driving poor data quality and integration, lack of contractual clarity, and disjointed services as major impediments to success and oversight.”
Governor Newsom also weighed in, with his spokesperson Tara Gallegos providing the following statement to KTLA:
“This (audit) reaffirms the state’s prior findings that local governments need to do a better job of tracking homelessness spending. That’s why Governor Newsom has implemented new, strict accountability measures to increase accountability and ensure every dollar is spent effectively.”
Read more at the Los Angeles Times.