Federal officials have sharply criticized the Los Angeles Homeless Services Authority (LAHSA), citing concerns over alleged fraud, mismanagement, and a lack of progress in combating the city's homelessness crisis. The U.S. Department of Housing and Urban Development (HUD) had previously moved to block $241 million in funding to LAHSA, an action that was temporarily halted by a federal judge. However, officials maintain that the agency is failing to effectively address the issue.
US Department of Health and Human Services Secretary Robert F. Kennedy Jr. and HUD Secretary Scott Turner recently visited Southern California to emphasize their concerns. Turner pointed out that while homelessness in Los Angeles has doubled over the past decade, funding to LAHSA has nearly tripled, yet the agency has struggled to account for billions of dollars, including approximately $1 billion in federal funds.
LAHSA's struggles have coincided with an increase in the homeless population. The 2026 homeless count indicated a 3.4% rise in the number of homeless individuals in the city of Los Angeles and a 1.2% increase in the county. A federal judge, David O. Carter, intervened to preserve LAHSA's funding, but only because a replacement agency had not yet been established. He made it clear that the current situation is not sustainable.
Officials are advocating for a paradigm shift in homelessness policy, moving away from the "housing first" model. Kennedy described the "housing first" approach as having spent billions on temporary housing without adequately addressing the root causes of homelessness, such as drug addiction and mental illness. He suggested that this approach led to individuals returning to the streets where they could more easily access and abuse substances.
Kennedy highlighted faith-based organizations like the Dream Center as an example of an alternative that integrates treatment with shelter. He stated that such programs can help people recover and regain stability at a significantly lower cost compared to the "housing first" strategy that Los Angeles and California have largely adopted. The call from federal officials suggests that LAHSA's operational model and the long-standing "housing first" policy are being questioned, with a push for a "treatment first" alternative to combat homelessness more effectively.