United Way Assails Distribution of U.S. Funds for Homeless

The annual distribution of federal funds for the homeless unfairly favors suburban areas over inner cities and is partly responsible for cutting Los Angeles’ share by $1 million to only $4 million this year, United Way officials charged Wednesday.

The formula is inequitable, officials said, because it distributes funds according to unemployment statistics, which do not count so-called “discouraged workers” who have been unemployed 26 weeks or more. The number of homeless in Los Angeles is most frequently estimated at 35,000, many of whom are believed to fall outside the unemployment statistics.

“This means a well-paid construction worker on two weeks rain layoff in a suburban county will increase his community’s share of money, while a homeless mother with three kids in Los Angeles will not,” said the Rev. Gene Boutilier, who coordinates homeless and hunger operations for the United Way.

According to the federal Bureau of Labor Statistics, unemployment in Los Angeles was 5.9% in October, 1987, and dropped to 4.3% in October, 1988. However, INFO LINE, a publicly funded hot line, said the number of requests it received for emergency shelter increased from 2,137 in October, 1987, to 2,312 in October, 1988.

“We’re arguing about table scraps,” Boutilier said. “Obviously the better formula would be to increase federal funding.”

Drop in Allocation

But Congress reduced the total appropriations for the program in fiscal 1989 by $10 million to $114 million this year, a factor that also contributed to the drop in the Los Angeles allocation.

Though Los Angeles still receives more federal funding for homeless than any other city, Boutilier said, the $1-million cut means a virtual halt in the rehabilitation of available shelters here, a drastic reduction in the money available to families in need of emergency motel stays, and other cuts.

Government agencies combined spend about $20 million a year for programs aimed specifically at the homeless and the hungry in Los Angeles County, Boutilier said. Nonprofit agencies contribute additional sums. United Way, for example, contributes $3 million, Boutilier said.

Wiley Cooper, director of the Emergency Food and Shelter National Board Program in Washington, called the current formula “inadequate” in an interview Wednesday. He stopped short of saying that Los Angeles is unfairly represented in the distribution of federal money, however.

“I don’t love the formula either--we’ve had complaints about it from Day 1,” Cooper said. “We recognize that all across the country, not just in your community, that there are people who are chronically unemployed who are not included in the statistics. . . . But what do we do instead?”

The use of federal unemployment figures as the basis for computing homeless funds has been in practice since 1983, when Congress authorized emergency funding to help what was called the “new homeless,” particularly families whose wage-earner had recently lost a job.

Because some small communities across the country already complained about the formula for other reasons, Congress has mandated that the emergency board submit alternative formulas for fund distribution later this year.

Leo P. Cornelius, United Way president and chairman of the 16-member local emergency board that coordinates the homeless program in Los Angeles, said he plans to call a board meeting to develop a strategy to promote an alternative formula.

‘We Were Cushioned’

“I don’t think this formula deals with reality,” he said. “We were cushioned somewhat before because there was more money available. Now that’s gone.”

Boutilier said he would prefer using on the national level a system like that used inside Los Angeles County to distribute funds. That system considers not only unemployment statistics, but also welfare and poverty figures, data showing the number of people turned away from shelters, and expert opinions.

By that formula, he added, the amount of money going to the San Fernando Valley will be increased slightly this year and that going to the Westside will be decreased.

Cooper said national poverty figures stem from the 1980 census, which is now outdated. Many other statistics, he said, are not gathered evenly by local and state jurisdictions across the country. Another alternative, he said, is to increase a small portion of the federal program that allots discretionary funds to state boards to distribute as they see fit.