Children Family Services

January 29, 2004
Former Pacific Northwest Director Greg Shaw provided technical advice to members of the Washington State Children and Families Services Legislative Committee considering legislation to increase funding for family services.

House Hearing Room D, John L. O’Brien Building

Good afternoon. Madam Chairwoman and Members of the Committee, I’m Greg Shaw, director of the Pacific Northwest Program at the Bill & Melinda Gates Foundation. I also serve as Co-Chair of the Sound Families Steering Committee. I am joined here today by Katie Hong, Director of the Seattle Office of Housing and Co-Chair of the Sound Families Steering Committee. As you may know, Sound Families is a public-private partnership involving our foundation, a number of local nonprofits as well as city, county and state government. This public-private partnership is precisely the kind of initiative that this legislation would encourage.

Although private foundations are not generally allowed to express their views to legislative officials on specific pending legislation, the written invitation we received from Chairwoman Kagi requesting that we speak on issues surrounding transitional housing and House Bill 2818 allows us to participate at this public hearing. Additionally, a primary objective of our participating in these discussions is to continue our work with the State of Washington and other local government instrumentalities through jointly funded programs that provide support for the area’s homeless.

I am pleased to be here today on behalf of the Gates Foundation to provide background information on Sound Families and the Gates Foundation’s interest in support-enriched transitional housing in the Puget Sound region. I’d like to commend you, Representatives Kagi, Boldt and Darneille, on your leadership and that of the Committee in working to secure long-term funding housing and supportive services for homeless families.

I’d like to take a few moments to briefly describe the original vision of our foundation’s benefactors, Bill and Melinda Gates. It was their desire to help create a program that would bring many parties to the table to provide housing solutions for families at risk of becoming homeless in the Puget Sound region.

Although we live in one of the wealthiest areas of the country – and indeed the world –  the statistics surrounding our poverty rates, homelessness and the lack of affordable housing in the Puget Sound region are daunting.

Consider:

A one-night count in King County, Washington in 2001 found that approximately 42% of residents of homeless shelters or temporary housing were families with children.

Families with children are one of the fastest growing segments of all homeless populations. 

In Washington an extremely low income household (earning $18,816, or 30% of the Area Median Income of $62,721) can afford a monthly rent of no more than $470, while the Fair Market Rent for a two-bedroom unit is $788.

Research shows that thousands of individuals, including children, are without a safe place to sleep on any given night in our area. 

In keeping with the foundation’s investment philosophy, the benefactors and leadership wanted to determine how funding could be catalytic in shaping a long-term holistic solution to homelessness for families through community-based partnerships.

At the beginning of 2000, Bill Gates Sr. engaged in lengthy discussions with the University of Washington School of Social Work and the City of Seattle Office of Housing to discern how best to achieve solutions for families transitioning out of homelessness. We learned two key truths: a) there was a simple lack of transitional housing available for families in the Puget Sound region, and b) offering support services in conjunction with housing was the best way to ensure long-term stability for families struggling with homelessness.

After listening to housing experts and social service providers, the Gates Foundation created what has emerged to be a true public/private partnership called Sound Families. The program matches the vision and resources of the foundation with the expertise of local government in identifying transitional housing projects.

In 2000, the Gates Foundation made a commitment of $40 million to create Sound Families. Our goal is to create 1,500 new housing units for families in transition out of homelessness throughout Pierce, King and Snohomish Counties and to provide vital services to the families in these units such as job training, childcare, counseling, and drug and alcohol treatment.

Sound Families provides capital funds as well as a portion of the needed service funding for five years. All 7 housing authorities in the Sound Families region have pledged Section 8 rental assistance to families, which support both building operations and on-site services.

Since our first funding round in 2001, I’m pleased to report that more than 740 housing units have been funded in the past three and a half years, thanks in large part to the partnership formed between the private philanthropic community, local housing jurisdictions and federal rent subsidies.

The University of Washington School of Social Work is evaluating the program and will track the impact of the program on the client’s services, the participating organizations and the system that serves homeless families. And although it’s premature to circulate any definitive findings from Sound Families grantees, preliminary findings are showing promising results.  For example:

55 percent of families increased their income levels while in the Sound Families housing program;

66 percent of families moved from transitional housing to fair-market, public or subsidized housing. About half of these families are using a Section 8 voucher;

At entry, 64 percent of residents were receiving aid from TANF; at exit the number of families receiving TANF funds was reduced to 44 percent.

It’s clear that Sound Families has helped create new momentum and coordination among housing developers, local governments and service providers to provide families with new resources to combat homelessness in our region. We’re convinced that part of the reason we’re seeing early positive outcomes is because of our close coordination with local and state government. For example, representatives from the state, including Stephen Buxbaum from State Department of Community Trade and Economic Development and Dennis Braddock from the Department of Social and Health Services, provide valuable insights as key members of our Sound Families Steering Committee. Numerous individuals from local housing authorities in Pierce, King and Snohomish Counties are also active members of our program’s governance.

Our program does face challenges, however, and as we’ve just passed the mid-way point in funding housing units, we believe this is an appropriate time to underscore the importance of identifying long-term funding solutions for support services.

As many of you know, Washington State does provide capital funds for low-income housing developers through the State Housing Trust Fund and low-income housing tax credits. Service dollars, however, are more scarce and difficult for nonprofit organizations to raise.

Sound Families grants provide approximately 30% of needed service dollars for five years. After that, grantees must rely on other donors to fund critical services for homeless families.

Because national findings, as well as our own preliminary data, strongly indicate that service-based transitional housing provides long-term solutions for family homelessness, a stable source of service funds must be identified. Moreover, the lessons we’ve learned from Sound Families can certainly be applied to other parts of our state if service dollars were more readily available. 

The Gates Foundation will soon be providing comments on the proposed legislation in writing. However, today I offer three initial thoughts based on previous conversations with other private donors:

1. We recommend that the proposed fund be contracted out and held independently, perhaps by a tax-exempt foundation or nonprofit entity with experience in fund management;
2. We recommend that the fund be completely transparent and open to community inspection;
3. The management and distribution of the proposed fund should involve minimal bureaucracy, and be “user friendly” for project sponsors.

I should also note that the Gates Foundation will host a forum for other regional foundations in to discuss the implications of a statewide service fund.
 
In conclusion, I can affirm the continued support of the Gates Foundation for securing funding resources for social services paired with transitional housing projects. Simply stated, services-based housing is an effective model for bridging families from homelessness to self-sufficiency.

In the months to come, the Gates Foundation will be sharing additional findings from the Sound Families program that we hope other cities and regions can apply to their own strategies to combat homelessness. I look forward to continuing this discussion with the Committee as we collect additional data, and as new solutions are found to ensure long-term viability for social service providers working with homeless families across Washington State. 

Thank you.