The Brief

The Los Angeles region’s lead homelessness agency is effectively forfeiting the federal administrative roles it has held for decades, including applying for millions of dollars in funding for the region and leading the annual homeless count, the agency announced Tuesday.

The decision comes as the Los Angeles Homeless Services Authority faces mounting criticism from both the Trump administration and local leaders who accuse the agency of mismanaging homeless services.

It reverses a monthslong legal battle LAHSA had been waging with the federal government to continue in these duties.

The city of Los Angeles, L.A. County and other entities and organizations are now applying to take them over.

At a county meeting Tuesday, Supervisor Lindsey Horvath called it “a fundamental change that reflects the significant performance, contracting and financial concerns that have plagued LAHSA for too long.”

“ Officials avoiding accountability will no longer have LAHSA to hide behind, and the county and city must be accountable to each other and to our entire Los Angeles region,” Horvath continued.

LAHSA's decision

In June, the U.S. Department of Housing and Urban Development suspended LAHSA from conducting its federal duties, including applying for or receiving grants, putting $241 million in anticipated funding and LAHSA’s future in limbo.

LAHSA sued.

U.S. District Judge David O. Carter paused LAHSA’s suspension on Aug. 13, but also instructed a regional planning body known as the L.A. Continuum of Care Board to solicit applications from other entities to replace LAHSA in those key roles.

The Continuum of Care Board opened its application process online last week, inviting qualified organizations to take on one or more of LAHSA’s current administrative roles.

LAHSA’s governing commission voted unanimously Tuesday to not apply, effectively forfeiting the federal roles that comprise most of its remaining responsibilities.

The city of L.A. and L.A. County are both applying, according to LAHSA.

“With both the City and County preparing their own applications, competing against our founding partners would only fracture regional collaboration during an already complex time,” LAHSA spokesperson Chris Yee said in a statement.

“This decision reflects the shared judgment of LAHSA’s Commission and executive leadership,” the statement continued.

Federal roles

LAHSA will forfeit the following federal homelessness roles:

1. Coordinating and submitting annual federal homeless assistance funding applications to HUD on behalf of the entire L.A. region — about $240 million in the coming year.

2. Planning, executing and reporting the region’s annual point-in-time homeless count.

3. Operating and administering a HUD-mandated database that tracks who's being served and whether they're moving into housing.

4. Managing and operating a HUD-mandated system to match unhoused people to available housing and services based on need.

How we got here

After Carter paused LAHSA’s suspension, the federal housing agency appealed the decision to the Ninth Circuit Court of Appeals. Last week, the appeals court issued a temporary stay on Carter's order.

LAHSA said that ruling created more uncertainty about whether the agency was eligible to apply for the federal roles it has held for the past three decades.

“Stepping aside now supports alignment with the direction the City and County are heading with their applications, and focuses public resources where they belong: on the people who depend on the rehousing system every day,” said Yee, the agency spokesperson.

LAHSA is a joint powers authority between the city and county, created three decades ago to manage the region’s response to homelessness.

City and county officials are collectively responsible for LAHSA, which has administered federal, state, county and city homelessness funding across the region.

Citing LAHSA’s management problems, L.A. County pulled more than $300 million annual homelessness funding from the agency starting this year, choosing instead to administer the funds through a new county homelessness department.

The city of L.A. is considering a similar move away from LAHSA. Mayor Karen Bass and her election rival Councilmember Nithya Raman both say the city needs its own independent homeless system.

In the current budget year, 73% of LAHSA’s nearly $500 million budget comes from the city of L.A., 20% from the federal government and 4% from L.A. County.

What’s next? 

LAHSA said it will continue to fulfill its ongoing federal responsibilities “until those duties transition to a new entity or entities.”

The agency has agreements with the city of L.A. to manage programs and contracts through June 30, 2027.

The county’s Department of Homeless Services and Housing is applying to take over all four of LAHSA’s federal responsibilities, according to county officials. The city of L.A. is currently applying for at least two of those roles, putting the city and county in competition with each other.

“Moving forward, another entity will be leading the [Continuum of Care], which I believe should be the county, given our ability to most effectively administer contracts for our region,” Horvath said Tuesday.

Other organizations have also expressed interest. Better Angels, a homelessness nonprofit led by former L.A. mayoral candidate Adam Miller, contacted the court seeking to apply.

Applicants looking to take over LAHSA’s federal roles have until Sept. 25 to submit applications, but had to communicate their intent to apply by Sept. 15.

The applicants selected by L.A.’s regional Continuum of Care Board will have to be reviewed by HUD and the federal court.

The Los Angeles Unified School District’s falling enrollment and budget challenges are fueling conversations planned for later this year about potential school closures and consolidation.

“Our goal is not simply to have fewer schools; our goal is to have stronger schools, schools that are better resourced, schools that offer more programs for our students,” Superintendent Andrés Chait said during a school board meeting Tuesday. The superintendent shared a similar message in a video sent to families Monday.

LAUSD is spending more money than it brings in and has relied on reserves to fill the gap in recent years. In Tuesday’s meeting, district leaders presented an updated snapshot of LAUSD’s finances that shows steeper enrollment declines and lower state revenue and reserves than projected early this summer.

“That deficit spending is only possible while we have reserves and the very significant challenge that we’re facing as a district is that those reserves are being depleted very quickly,” said Saman Bravo-Karimi, the district's chief financial officer. “They’re eventually going to go negative and we can’t have negative balances as a school district.”

How is enrollment changing? 

Almost 4% fewer students than expected are attending LAUSD schools this academic year compared to last year, according to preliminary data.

Bravo-Karimi said that each 1% drop in enrollment is a loss of about $20 million a year because California funds schools based on how many students show up to class each day.

Fewer students have attended LAUSD schools over the last two decades, in part because of falling birth rates and the region’s high cost of living, but those declines were steeper than anticipated in recent years.

Board member Kelly Gonez said the schools in East San Fernando Valley communities targeted by federal agents have double the enrollment declines of other campuses.

“That increase in enrollment decline last school year was not a coincidence,” Gonez said. “Something changed … that is the presence of a federal administration that is attacking our immigrant communities.”

How is LAUSD approaching school closures?

The district pulled a scheduled vote Monday night on a $960,000 contract with a school closure consultant.

The district planned to work with Alvarez and Marsal to develop a framework for possible school closures, mergers or reconfigurations.

The firm’s priorities, as described on their website, include “maximizing investment value in education” and reshaping how institutions operate.

Alvarez and Marsal are also associated with several controversial decisions, including closing more than a dozen campuses during an overhaul of St. Louis schools in 2003 and faltering when contracted to restructure New York City schools' bus routes in 2007.

Several members of the public and a leader in the district’s teachers union spoke out against the contract and any similar future consultants.

“It’s hard for us to seriously work with this district to fight for more state funding when you squander limited funds you have on contracts with vultures and privatizers like the Alvarez company,” said Julie Van Winkle, United Teachers Los Angeles vice president.

Chait said the decision to remove the contract from consideration was in response to messages from school, community and district stakeholders over the weekend.

“One of the core leadership principles that I’ve always really tried to live by is to listen to folks, especially when they disagree,” Chait said.

Chait said the district needs external support to convene community meetings and compile and analyze data.

“This is arguably the most complex, the most difficult endeavor we will ever take on,” Chait said of school consolidations. “It will reset the footprint of our district for years to come.”

Chait said the district will begin holding community conversations related to school closures in the next few weeks and will share more details during a Sept. 22 meeting.

How did LAUSD’s budget become so strained?

The district’s current $20.6 billion budget projects a $2 billion deficit.

LAUSD approved raises for teachers, principals and support staff earlier this year at the cost of an additional $1 billion this school year. LAUSD, like other districts in the state, also faces increased costs for employee health care, settlements for decades-old sexual assault claims and services for students with disabilities,

L.A. County education officials approved the district’s most recent budget Tuesday on the condition that LAUSD provide additional information about how it is implementing cuts this school year.

However, L.A. County Superintendent Debra Duardo also called out the district's “unsustainable” use of reserves.

“The district’s fiscal status necessitates continued monitoring for both immediate and future corrective actions,” Duardo wrote in a letter to district leadership, referencing the July appointment of a fiscal expert to advise the district.

LAUSD’s board has approved a series of plans to reduce spending and increase revenue. For example, the district eliminated hundreds of jobs, primarily in its administrative offices, earlier this year.

The district’s most recent fiscal stabilization plan includes furlough days for all employees, the elimination of thousands of jobs and cuts to programs that help high-needs schools pay for counselors, tutors and other student supports.

Most of these cuts aren’t scheduled to go into effect until the 2027-28 and 2028-29 school years.

The leader of a congressional panel warned Tuesday he would use “every tool” to get Los Angeles Mayor Karen Bass to testify after she skipped a hearing that put L.A.’s homeless services system in the hot seat.

It came as multiple audits, reviews and court rulings have found L.A. has failed to ensure proper tracking of large-scale spending on homeless services — particularly through the joint city-county L.A. Homeless Services Authority, known as LAHSA. Much of the money is federal dollars authorized by Congress.

Bass had declined to testify at Tuesday’s hearing, saying she was unavailable and that it would be a “politically motivated” attack. Her public schedule showed she planned to attend a groundbreaking of a shopping and community center in the Pacific Palisades two hours after the hearing was set to start.

Rep. Tim Burchett, the Tennessee Republican who chairs the House Oversight Committee's DOGE subcommittee, said she won't get off that easily.

Bass "seems intent on evading accountability, but she knows we will not let her off the hook," Burchett said at the hearing. He added that he and the Oversight Committee’s chair would "use every tool at our disposal to secure her appearance if she does not cooperate.”

House committees and subcommittees can issue subpoenas to compel witnesses to testify or provide documents.

Just before the hearing got underway, Bass called it "the latest attack on Los Angeles by the Trump Administration and his allies in Congress.”

"I don't run LAHSA," she said, adding that she was the first mayor to sit on its board and that street homelessness has dropped since she took office. The latest official count for the city showed a 8% year to year jump in street homelessness.

Bass stepped off LAHSA’s governing commission last week, after LAist reported she had missed most of its meetings since she appointed herself to it in 2023. The mayor cited “time and all” as her reason for stepping down. She continues to appoint — and has the power to remove — half the commission’s members, including its current chair.

What happened at the hearing

Much of the hour-and-a-half hearing focused on Republican members’ criticism that Democrat-led cities distribute drug paraphernalia and don’t require unhoused people with addictions to get treatment as a condition of living in publicly funded housing.

Some proposals raised Tuesday would change how money reaches Los Angeles.

Burchett said he will introduce the Recovery First Housing Act, to require federally funded housing to offer substance abuse treatment. He has also introduced a bill restricting federal housing dollars to only support U.S. citizens.

LA's fights on a national stage

Burchett noted LAHSA’s audit committee chair, Justin Szlasa — who was proactive in rooting out wasteful spending — was demoted by Stephanie Graves, a Bass appointee who has declined to give her reason for doing so. The move was first reported by LAist.

Burchett also made claims that don’t hold up. He said 50,000 people are homeless in the city with "another 75,000" in the surrounding county. The latest official count found a total of 73,000 unhoused people across L.A. County — a figure that includes the city.

Burchett also said, “ LAHSA recently doled out funds to an L.A.-area nonprofit whose CEO had just been indicted for fraud.” LAist recently investigated LAHSA’s awarding of funds to that nonprofit, Abundant Blessings, and found no indication that LAHSA awarded it any funds after the fraud indictment. However, the review did find that long before the indictment, LAHSA kept awarding millions in contracts to the group even after it was flagged internally as high-risk for failing to do its job.

Burchett, however, was correct in saying “a court-ordered independent assessment of LAHSA's finances found alarming financial control weaknesses that leave the door open to rampant fraud.”

On Tuesday, street safety advocates and families of victims of vehicle collisions demanded that Los Angeles Mayor Karen Bass declare a state of emergency on traffic violence in the city.

Sandra Sanchez Loulakis’s son died last year after she said he was hit by a negligent driver.

“I’ve been struggling just to survive daily,” she said at the news conference organized by traffic safety nonprofit Streets are for Everyone. “This is what happens to a parent when they lose a child.”

The city has seen 8% more fatal traffic collisions this year than during the same period last year, according to LAPD data from the end of August.

Advocates said an emergency declaration would better coordinate resources to respond to traffic fatalities, which have exceeded the rate of homicides for the last three years.

“ This is not a matter of we don't know what to do,” Damian Kevitt, who leads Streets are for Everyone, said Tuesday. “This is a matter of we know exactly what to do. We’re just not making this a priority as a city.”

Kevitt said more than 1,250 people signed an open letter delivered to the mayor and L.A. City Council. One of the demands listed in the letter is for the city to restore transportation department staff.

Earlier this year, the city gave up $100 million in state grants to make streets safer because it did not have the personnel to complete the projects in compliance with state-mandated deadlines.

Draft executive directive on Vision Zero

It appears there had been momentum from the mayor’s office earlier this year to issue an executive directive recommitting the city to its Vision Zero goals of reducing traffic fatalities to zero.

According to emails from May shared with LAist, the mayor’s senior director of transportation told an activist that a draft executive directive was “under review” and expected to be released “within the next three weeks.”

The email was sent to Jonathan Hale, who organizes community members to paint crosswalks where there have been pedestrian-involved collisions.

The executive directive has yet to be released.

LAist submitted a public records request for drafts of the executive directive, but on Sept. 14, the mayor’s office responded saying it could not disclose any records.

“[The records] include drafts and/or deliberative process for which the public interest served in nondisclosure clearly outweighs the public interest served by the disclosure,” the office said.

The mayor’s office has not responded to requests for comment about the draft executive directive.