On March 11, 2021, the American Rescue Plan Act of 2021 was signed into law, including the appropriation of more than $130 billion to the Coronavirus Local Fiscal Recovery Fund, for making payments to metropolitan cities, counties, and other units of local government to mitigate the fiscal effects stemming from the public health emergency. Hennepin County expects to receive direct payments from the U.S. Treasury totaling more than $220 million and received the first half payment of $122.9 million in May of 2021.

The American Rescue Plan Act provides that money from the Coronavirus Local Fiscal Recovery Fund may only be used to cover certain costs incurred between March 3, 2021 and December 31, 2024, and expended by December 31, 2024, including costs to respond to the public health emergency or its negative economic impacts, including assistance to households, small businesses, and nonprofits. Under the available Treasury guidance, this category of eligible costs can include COVID-19 mitigation and prevention; support for isolation or quarantine; support for prevention, mitigation, or other services in congregate living facilities; capital investments in public facilities to meet pandemic operational needs; supports for vulnerable populations to access medical or public health services; or services or outreach to promote access to physical or behavioral health primary care and preventative medicine. Eligible costs may also include rent, mortgage, or utility assistance; counseling and legal aid to prevent eviction or homelessness; or cash assistance. Additional services may be an eligible use of Federal Pandemic Funds when provided to populations, households, or geographic areas that are disproportionately impacted by the pandemic, including funding community health workers and public benefits navigators; housing services to support healthy living environments; services to address homelessness such as supportive housing; affordable housing development; or housing vouchers, residential counseling, or housing navigation assistance.

People experiencing homelessness and unsheltered homelessness are at risk for infection during community spread of COVID-19, and interim guidance for homeless shelters and for unsheltered homelessness from the CDC advises identifying additional temporary housing and shelter sites for overflow, isolation, quarantine, and protective housing of individuals experiencing homelessness during COVID-19. Ensuring that there is sufficient, high quality, 24/7 housing focused shelter is necessary to protect people experiencing homelessness during the pandemic.

Beyond the repercussions to the health and safety of county residents, the unprecedented economic environment created by the COVID-19 pandemic has resulted in massive business closings, income loss, and unemployment. For low-income Hennepin County residents, any break in income can have serious financial consequences, making it even harder to pay for already unaffordable housing costs. Ensuring that people can be safely sheltered during any period of homelessness and connected back to permanent housing as swiftly as possible is important for our individual and community health.

The economic impacts of COVID-19 were most heavily felt by people with low incomes, and Black, Indigenous, or People of Color (BIPOC). Of individuals requesting emergency rental assistance in Hennepin County, nearly 2/3 have incomes below 30% of the area median income (AMI), and 4/5 are BIPOC. Similarly, homelessness in Hennepin County is disproportionately experienced by BIPOC. In the most recent HUD Point-In-Time Count, African Americans made up 60% of all those experiencing homelessness while Native Americans accounted for almost 9% (compared to general population representations of 13% and 0.7% respectively).

Staff recommends the use of Federal Pandemic Funds in the following homelessness strategy areas:

• investments to support the ongoing operations of new shelter programs – specifically Avivo Villages and the American Indian Community Development Corporation’s Homeward Bound – that were launched this past winter to provide additional low-barrier, housing focused emergency shelter to people experiencing homelessness with an emphasis on communities most likely to experience unsheltered homelessness
• investments to support the ongoing 24/7 operations in shelters that, pre-pandemic, operated on an overnight only basis in order that they can better meet the health and housing needs of guests during their housing crisis

• support for the lowering of barriers to shelter through the elimination of self-pay contributions
• support for shelter diversion programs that help people access safe alternatives to emergency shelter during a housing crisis and assist people in leveraging community resources
• establishment of a one-time capital fund to fund necessary modifications to and expenditures at emergency homeless shelters and Board and Lodge settings to mitigate COVID-19 effects and enable compliance with COVID-19 public health precautions
• provide a time-limited influx of additional services to reverse the increases in unsheltered homelessness seen since the start of the pandemic. In partnership with our providers, we will develop a new codified model for working with people in encampment settings to connect them to safer alternatives, particularly housing, and use the learnings to inform and improve ongoing services.

Current Request: Authorize up to $25,550,000 of Federal Pandemic Funds to advance equitable homelessness response strategies; negotiate agreements for services 08/01/21–12/31/24. This would allow for Federal Pandemic Funds to support the above interventions in the following estimated year-by-year amounts. In cases where previously allocated Federal funds are set to expire in 2022, the amounts are lower in the first year:

Impact/Outcomes: The measures supported through this Board Action Request will provide ~5,000 people with low barrier, housing focused, 24/7, free to use shelter each year in a variety of settings designed to meet the needs of diverse communities, including culturally specific settings.

In addition these measures will:

• Assist a further 750 people with accessing safe alternatives to shelter each year
• Improve the physical facilities to fund necessary modifications to and expenditures at emergency shelters for the homeless to mitigate COVID-19 effects and enable compliance with COVID-19 public health precautions
• Establish additional homelessness outreach capacity and a new coordinated model for connecting people experiencing unsheltered homelessness to safer community alternatives.