Denver homeless program called a ‘remarkable success’

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A Denver homeless camp
Credit: Noah Skinner

DENVER (KDVR) – A yearslong social impact program aimed at reducing Denver homelessness by placing chronically homeless individuals into housing surrounded by intensive services was deemed a “remarkable success” by the Urban Institute, in a review this summer.

An analysis by the nonprofit research organization found the impacts of the Social Impact Bond program “disrupt the false narratives that homelessness is an unsolvable problem and that people who experience chronic homelessness choose to live on the street.”

Denver’s Social Impact Bond Program launched in 2016 and was designed to cut the frequency with which unhoused people were jailed and utilized emergency health services.

The program leveraged Medicaid dollars and housing assistance funds while utilizing $8.6 million in up-front, private investor funding.

“The city agreed that if the program worked, as indicated by performance measures outlined in the contract and validated by a rigorous evaluation, it would repay the private lenders, potentially with a positive return,” the Urban Institute report said.

Ultimately, 285 chronically homeless people were placed in subsidized housing with support, and three years after entering the housing, 77% of the living participants were still there. They also had 34% fewer contacts with police.

According to the Urban Institute review, the program “demonstrated that with the offer of housing first and the right supports, people can exit homelessness and remain housed, even after living on the streets or in shelters for years and grappling with mental health and substance use challenges.”

The initiative concluded at the end of 2020, but the city is continuing to support the housing of people who were placed into units, according to Derek Woodbury, the communications director for Denver’s Department of Housing Stability.

Woodbury said Denver paid out a total of $9.6 million at the conclusion of the program.

“These payments represent the full initial investment plus an additional $1 million based on the project’s outcomes,” he said. “The project was so successful, it passed the contract threshold in which investors agreed to share success payment with providers.”

For example, Woodbury said of the extra $1 million that was paid out, $251,000 would be shared by an investor, the Northern Trust Corporation, with the Colorado Coalition for the Homeless and the Mental Health Center of Denver.

Denver to launch similar program with federal support

In September, the U.S. Department of the Treasury awarded $6.3 million to the City and County of Denver to fund a similar program under the Social Impact Partnerships to Pay for Results Act.

Denver is the second city in the United States to receive the funding but the first to use the grants to address homelessness, according to Woodbury.

Denver will use the grants to pay for a permanent supportive housing program called Housing to Health, or H2H.

“This investment will allow more Denver residents who are experiencing homelessness to receive basic housing and health services, which will make a substantial difference in the lives of these individuals and provide benefits to the whole community,” Secretary of the Treasury Janet L. Yellen said in a U.S. Department of the Treasury press release.

“Homelessness and housing insecurity are one of the most significant challenges that a person or family can face. The Treasury Department will continue to work with communities across the country as they seek to address this challenge and provide opportunities to those at risk of being homeless,” she said.

According to the treasury department, Denver’s program will target “homeless individuals 18 years or older, who have been previously incarcerated, and are at high risk for avoidable and high-cost health services.”

According to the U.S. Department of the Treasury, “Denver will receive up to $5.512 million if its H2H program sees an increase in housing stability (reduction in homelessness), improved health, increased access to health services, and a decrease in criminal justice involvement. These outcomes are expected to lead to a reduction of net federal health care expenditures. The SIPPRA Independent Evaluator grant that Denver will receive will be used to pay for the costs of independently evaluating the project. Similar supportive housing projects have shown an increase in housing stability and access to health services while decreasing criminal justice involvement including fewer arrests and jail days.”

Woodbury said the H2H program would launch in February 2022 and last seven years. It would also involve yet-to-be-named investors who will provide $10.6 million in funding.

He said Denver would receive federal grants based on performance outcomes.

“The City and County of Denver will pass along the federal outcomes payment to investors,” Woodbury said.

With contributions in reporting from Carisa Scott, Serena Ung and DJ Summers.

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