Empowered By Orange County United Way

What are the costs of Homelessness in Orange County?

The current wave of homelessness throughout the United States is both costly and complex. Orange County has not been immune nor are there quick and easy solutions. But cities such as Orlando, Florida and Salt Lake City, Utah have demonstrated that with committed leadership and innovative collaborations between public and private entities, homelessness can be significantly reduced.

What’s more, according to the collaborative study by UC Irvine, Jamboree, and Orange County United Way, upon which United to End Homelessness was based, there are significant cost savings associated with enacting solutions proven effective to addressing homelessness.

This article will lay out many of the costs revealed in that groundbreaking study on homelessness in Orange County and what it means for your community.

The Cost of Homelessness

Whether you’re aware of it or not, if you are a resident of Orange County and you pay taxes, your money is being used to address homelessness. The cost study revealed that during the 2014/15 fiscal year, approximately $299 million was spent on addressing homelessness here in Orange County.

Across the major service clusters (health care, housing, and criminal justice), almost $121 million of our tax dollars were spent for healthcare alone towards our community’s homeless population in a 12-month period between 2014 and 2015. A significant percentage of these costs are incurred by chronically homeless individuals on the street. Based on report interviews, these individuals needs are so complex that if the costliest 10% are dropped from the analysis, the mean annual cost per person for all services would drop from $45,000 to approximately $10,000. Counties, cities and non-governmental agencies also spend roughly $23 million in criminal justice, police, prison and related services.

What Housing Brings For Costs Associated With Homelessness

Evidence shows that those costs would actually decrease by placing people who are chronically homeless* in Permanent Supportive Housing (PSH) due largely to the resulting decrease in emergency services. For example, 78% fewer ambulance rides, a 43% drop in visits and stays in the ER, and 100% fewer arrests would result from placing chronically homeless individuals living on the street or in emergency shelters in stable, supportive housing. The estimated average annual cost of services is almost 50% lower for the chronically homeless in PSH ($51,587) when compared to the cost of services for chronically homeless living on the streets ($100,759).

Taking into consideration the average cost of services per capita, the cost savings data show a revealing pattern: costs are significantly lower when people are housed, and this becomes especially true for the chronically homeless. The potential cost savings are approximately $42 million per year if PSH was provided for all Orange County chronically homeless. This takes into account the cost of housing homeless individuals and providing the associated services.

The current situation does not need to be this way. PSH is one method that is proven to save lives and taxpayer dollars. The United to End Homelessness initiative brings Orange County citizens together to ensure that the proven integrated and sustainable solutions outlined above are implemented to end homelessness in our community, starting with those suffering from disabling and debilitating conditions.

Discover what you can start doing for your community today.


*Chronic Homelessness Definition:

A ‘‘chronically homeless’’ individual is defined to mean a homeless individual with a disability who lives either in a place not meant for human habitation, a safe haven, or in an emergency shelter, or in an institutional care facility if the individual has been living in the facility for fewer than 90 days and had been living in a place not meant for human habitation, a safe haven, or in an emergency shelter immediately before entering the institutional care facility. In order to meet the ‘‘chronically homeless’’ definition, the individual also must have been living as described above continuously for at least 12 months, or on at least four separate occasions in the last 3 years, where the combined occasions total a length of time of at least 12 months. Each period separating the occasions must include at least 7 nights of living in a situation other than a place not meant for human habitation, in an emergency shelter, or in a safe haven.

Chronically homeless families are families with adult heads of household who meet the definition of a chronically homeless individual. If there is no adult in the family, the family would still be considered chronically homeless if a minor head of household meets all the criteria of a chronically homeless individual. A chronically homeless family includes those whose composition has fluctuated while the head of household has been homeless.

View Flowchart of HUD’s Definition of Chronic Homelessness