An Affordable Plan - Alberta Human Services - Government of Alberta

An Affordable Plan

Ending homelessness in Alberta will require ongoing financial commitment from the Alberta government, but at a level that is affordable and fair for taxpayers.

The Secretariat has attempted to estimate the operating and capital costs of the Plan for Alberta based on research and data that is currently available
The Plan for Alberta requires a wholesale shift in the approach to homelessness. Instead of spending money on managing the homeless, dollars will be invested to rapidly re-house homeless clients and deliver effective support to these clients to help them achieve stability. New funding will be used to bring about this philosophical change in the homeless-serving system.

Existing funding relating to homelessness will also need to continue. Funding for emergency assistance, such as rent supplements, will play an ongoing role in preventing homelessness. These programs may require incremental funding adjustments to ensure they continue meeting their objectives. New dollars may also be needed to augment other social programs across the Alberta government, in order to help prevent homelessness from occurring in the future.

Re-Housing The Homeless

In order to facilitate the rapid re-housing of homeless clients, substantial capital investment will be required. Table 2 outlines estimated capital costs of the Plan.

Although much existing housing stock (such as existing apartment buildings) will be used to increase the availability of housing options, there will be a need to create additional spaces.

For costing purposes, it is estimated that 8,000 new units will need to be created. This will require capital investments of $1.258 billion over the 10-year life of the Plan.

The actual total number of new units required over the 10-year Plan will depend on the availability of appropriate market housing and the effectiveness of prevention programs. During the first 12 months of implementing the Plan, the Secretariat will undertake detailed review of capital funding requirements and the development of a new homeless information data collection system.

Estimated unit costs vary depending on the category of homeless client. The higher cost of housing chronic homeless reflects the fact that these clients are often difficult to house due to other attendant challenges they face. Transient and employable homeless clients, by contrast, are often easier to house.

Table 2: New Capital Funding by Category

Category   Estimated number  Spaces required  Unit cost  Total 10-year Capital Investment 
Chronic homeless  3,000  2,500  $200,000  $500 million 
Transient homeless  5,500  4,400  $120,000  $528 million 
Employable homeless  1,500  300  $100,000  $30 million 
Homeless families  1,000  800  $250,000  $200 million 
Total capital costs        $1.28 billion 

Supports to Maintain Housing Stability

The Plan contemplates that communities will take the lead in action on homelessness. As such, annual operating funding will support evidence-informed, community-led support programs that are compatible with the Housing First approach. Table 3 outlines estimated operating funding requirements of the Plan.

Successful outcomes are being demonstrated by a number of initiatives that some Alberta communities are currently piloting. These programs employ Housing First philosophies and serve as a basis for province-wide action:

  • Pathways to Housing is a low-barrier program that targets chronic homeless individuals, and homeless individuals who face multiple barriers to housing. Clients are provided with permanent housing and wrap-around support by an Assertive Community Treatment (ACT) team of professionals on a 24/7 basis.
  • Rapid Exit seeks to reduce the amount of time that individuals and families spend in homelessness by re-housing single individuals or families in rental accommodations and providing on-going support. Landlords are recruited and supported by the service agency.
  • Streets to Homes provides intensive case management to homeless individuals, locates permanent housing and provides on-going support through a network of partner agencies.

These support programs are demonstrated best practices that align with Alberta’s 10-year Plan. The per-client cost estimates from these community-led pilot projects have been used to estimate the operating costs of the 10-year Plan, based on the estimated province-wide number of homeless clients in each category. The variance in per-client costs between categories reflects the different levels of support that each category of client requires. Chronic homeless clients require robust supports in order to maintain housing stability, while employable clients typically require modest supports to stabilize once re-housed.

The Plans operating budget over the 10-year Plan also includes initiatives such as: new research staffing and training support for homeless-serving providers. These elements will be essential for augmenting the capacity of community-based service providers to administer re-housing and support programs; and for gathering and analyzing homeless data in order to track progress and measure outcomes.

Table 3: New Operating Funding by Category

Category  Estimated number  Initiatives  Annual cost per client  Total 10-year Operating Cost 
Chronic homeless  3,000  Pathways to Housing  $34,000  $1.02 billion 
Transient homeless  5,500  Rapid Exit (singles)
Streets to Homes 
$14,000  $770 million 
Employable homeless  1,500  Employment readiness
Affordable rental 
$6,000  $90 million 
Homeless families  1,000  Rapid Exit (families)  $17,800  $178 million 
Subtotal operating costs for supports        $2.058 billion 

Total Direct Funding for 10-Year Plan

The total direct investment required to implement the Plan for Alberta over 10 years is estimated at $3.316 billion. Total direct investments are outlined in Table 4.

Direct investments will include $3.316 billion in capital and operating support to re-house homeless Albertans.

This direct investment will achieve the following outcomes:

  • Build 8,000 new units to re-house homeless Albertans.
  • Re-house 11,000 homeless Albertans.
  • Provide support to re-housed Albertans to restore their stability and prevent them from becoming homeless again.
  • Build a province wide data collection and reporting system to measure the successful implementation of the plan

Table 4: Total Direct Investments Required

  Total 10-Year Investment 
Capital costs to build housing units for homeless  $1.258 billion 
Operating costs for supports to homeless  $2.058 billion 
Total costs to re-house and support homeless  $3.316 billion 

Preventing Future Homelessness

To effectively end homelessness in Alberta, the Alberta government will also need to engage in robust efforts to prevent future homelessness from occurring. Therefore, additional costs may accrue to other government programs, outside the Plan for Alberta. For example, existing income assistance programs delivered by Alberta Employment and Immigration may require incremental new funding to provide a higher level of assistance to those Albertans who are at risk of homelessness.

Investing appropriate dollars in prevention efforts will have an impact on the success of the overall Plan for Alberta. By helping Albertans avoid falling into homelessness, prevention efforts will reduce the number of new clients entering the homeless system. This will translate into an overall reduction in the number of additional housing spaces that must be created.

As part of shorter-term work on implementing the Plan (see Section 6, “Staying on Track”), the adequacy and availability of Alberta government assistance programs will be reviewed. This work will help identify potential investments to augment prevention programming.

Better Data Yields Better Results

The Secretariat’s cost estimates are based on data that is currently available from comparable programs and initiatives within Alberta and across Canada. The estimates therefore come with assumptions and caveats, including:

  • The success of various programs may reduce the need for transient housing; data gathering will help determine changes in the transient homeless population.
  • Prevention efforts are expected to produce a quick drop in new homeless entering the system. More data is needed to verify this expectation.
  • Ramp-up rates in programming will be influenced by the labour market in Alberta; this may present a constraint.
  • Modelling numbers assume great success in reducing shelter populations.
  • Per-client costs of referenced support programs may be higher in certain communities than in those that are piloting the programs.
  • Capital cost estimates are based on an average of 650 square feet per unit at a cost of $230 per square foot, including some of the cost for land. This estimate assumes that supports for inexpensive land will be secured through sources such as municipal contributions, community donations, or tax credits.
  • Capital costs assume partnership and leveraging public dollars to resource support from various levels of government and local fund-raising initiatives.

As the Plan for Alberta is implemented, a great deal of work will be undertaken to test the validity of these assumptions. The development and deployment of standardized, province-wide data collection and analysis will help the Secretariat verify figures over time. As better data is gathered and understood, costs will be better refined, and opportunities for cost savings will be identified.

Created:
Modified:
PID: 14607