When I am asked what our mission and purpose is in Los Angeles County, I have often described it as being the "ultimate safety net." Our welfare offices, emergency rooms and community clinics serve the most vulnerable in our communities: those suffering from mental illness, medical problems, homelessness, unemployment or just plain hard times. In fact, if you were to call our 211 hotline or check the County’s website, you would be amazed at the scope and breadth of the services we make available to the 10 million people that call Los Angeles County home. But of all the health and human service programs the County oversees, our role as the provider of last resort is most prevalent – and most costly I might add – in the General Relief program.
Since 1901, Los Angeles County has administered this program – commonly known as "GR" – to provide temporary cash aid to indigent adults. All 58 counties across California are legally mandated by the State to provide assistance of this kind, but with no funding from the State of course. In Los Angeles County, over 85,000 individuals receive cash assistance through this program each month: up from 71,000 last year. I don’t exaggerate when I say that the price tag is staggering.
Direct costs currently are looming near the $200 million mark in local taxpayer dollars: up from $161 million last year. Over half of the caseload is homeless, and a number of them have been on this program for over 20 years. In addition, we estimate that the County spends almost 4 times the cost above and beyond providing GR cash assistance or other services to this population, mostly related to repeated incarcerations in County Jail and recurring visits to our emergency rooms and clinics. Technically, that would push our costs closer to $1 billion per year!
There has to be a better way to meet the needs of these individuals that are both humane and cost-effective, and not result in the endless cycle of indigence many of them face. That’s why I directed the County to develop a plan to restructure the GR program in such a way that looks beyond just doling out a monthly stipend, but instead is more focused on reducing overall long term costs and also on improving outcomes for those on the caseload. Basically, we are making the "ultimate safety net" stronger, more relevant and more responsive to the urgent needs of this population, and reducing the costs to the County in tandem.
We are confident we can achieve both of these goals, here’s how: it starts with first providing housing. In the past two years, the County’s Homeless Prevention Initiative has successfully supported housing for tens of thousands of people, through rental subsidies, eviction prevention assistance and other services. Expansion of such strategies combined with strong up-front screenings, employment and supportive services would enable many on our GR caseload to transition off the streets into housing and stabilize their lives. This in turn reduces incarceration and repeated visits to the hospital.
We also believe that the significant percentage of the GR caseload suffering from mental or physical illness would be better served by Supplemental Security Income (SSI). Conservative estimates put that number at approximately one-third of the overall caseload. If we can assist them in qualifying for SSI, that alone would represent a significant and entirely appropriate cost shift from the County to the federal government. But this doesn’t mean we would be walking away from our mandated responsibilities to serve the population. A portion of the resulting savings we achieve could be redirected into enhancing our services and providing additional housing subsidies.
These concepts for restructuring GR will be coming before the Board of Supervisors this month. It would require an initial one-time investment of $7 million dollars. This is money well spent, because doing so would enable us to restructure the program in such as way as to generate savings across the County system and reduce that $1 billion price tag. We would also draw down far more federal funding then we do now, to help pay for housing subsidies and additional employment services, as well as increased reimbursement for GR participants eligible for SSI. Studies indicate that currently the County spends $4.34 for services for GR participants for every one dollar spent on GR grants. Restructuring the program as proposed would enable us to actually save $3.67 for every one dollar spent.
There is no question that the proposal is a bold one, however I would argue that maintaining the status quo would be far riskier and certainly more expensive. We can certainly continue doing the same thing we have been doing for the past 108 years, and for that we will only see more homelessness, increased caseloads and more resulting costs.
We have a unique, unprecedented opportunity to implement policies that accomplish two very important tasks at once: improving services we are mandated to perform and saving County dollars in tandem. Re-engineering the General Relief program is the right thing to do now.