This article is part of a blog post series, Policy Actions for Racial Equity (PARE), which explores the many ways housing policies contribute and have contributed to racial disparities in our country.
In Denver, Colorado service providers, city officials, the police, and others have joined together to get people who are chronically homeless and frequently interact with law enforcement off the streets and into housing and for good.
After five years, the innovative Denver Supportive Housing Social Impact Bond (SIB) has proven that investing in housing with intensive supportive services can break the homelessness-jail cycle, which—due to systemically racist laws and enforcement—disproportionately harms Black, Indigenous and People of Color (BIPOC) communities. This initiative centered the needs of people experiencing chronic homelessness by devoting resources to housing and intensive supports, in turn reducing chronically homeless individuals’ interactions with high-cost public systems including emergency services and jail.
As the Denver SIB draws to a close, evaluators at the Urban Institute have deemed the program a “remarkable success.” The supportive housing provided through the SIB decreased police interactions and arrests, reduced participants’ use of emergency detox and health services, and increased housing stability, all while offsetting other public sector costs. Enterprise Community Partners is honored to have partnered on this scalable “pay for success” model with the City of Denver, Colorado Coalition for the Homeless (CCH), Mental Health Center of Denver (MHCD), Corporation for Supportive Housing, the Urban Institute, and institutional investors.
In Denver and throughout the country, the racial disparities in chronic homelessness, interactions with police and time spent in jail are inextricably linked. Housing policies at local, state, and national levels that favor white individuals, from redlining to overtly racist zoning to the Indian Removal Act and more, have contributed to BIPOC households having lower rates of homeownership and higher rates of eviction and homelessness compared to their white counterparts. Moreover, nationally, formerly incarcerated people are almost 10 times more likely to experience homelessness than the general public, and formerly incarcerated Black and Hispanic men have much higher rates of unsheltered homelessness than white men, exposing them to more frequent interactions with law enforcement.
The relationship between housing and the criminal legal system is bi-directional. As noted above, the criminal legal system impacts housing and neighborhoods in many ways. However, housing also directly impacts criminal justice outcomes and can offer pathways to a different type of justice by preventing crime, disrupting cycles of incarceration, and supporting a more rehabilitative approach to criminal justice overall. While policy and programmatic interventions that dismantle this racialized status quo can and must be advanced, supportive housing efforts like Denver’s SIB can more equitably serve the disproportionately BIPOC communities currently affected. Among other key findings, the SIB demonstrated that supportive housing can help chronically homeless people stay out of jail, formerly incarcerated people to find and remain in housing—an otherwise destructive cycle perpetuated by many current policies and practices that can therefore be incredibly difficult for individuals to break free from. (For a full analysis, see the Urban Institute’s final report.)
Denver’s Social Impact Bond program design
In 2016, the City of Denver sought to shift resources from high-cost public services that failed to disrupt the homelessness-jail cycle for Denverites experiencing chronic homelessness, multiple arrests, and struggling with mental health and substance use challenges to a Housing First approach intended to better serve the long-term interests of individuals and the community. The initiative’s randomized control trial evaluation is the most rigorous Permanent Supportive Housing evaluation to date and has been extensively detailed.
The initiative was funded with a combination of public dollars and $8.6 million in up-front private investments made through a social impact bond, which promised private investors would be repaid by the City if certain outcomes were achieved. Denver’s was one of the nation’s first supportive housing programs funded through this mechanism and has proven a great success. Institutional investors will be fully repaid, even crossing a threshold where dividends will be shared with the two service providers.
Supportive housing reduced interactions with the criminal legal system
Individuals who have struggled to obtain and maintain housing often also experience physical and mental health challenges, including substance use. Notably, BIPOC communities also disproportionately experience poor health outcomes due to myriad, racially motivated systemic factors, including unequal access to high-quality care and abuse by the medical system that has contributed to a fundamental mistrust among many BIPOC individuals.
Unaddressed mental health and substance use challenges contribute to heightened vulnerability to interactions with the police, which can result in arrests and time in detox or jail. If a person has a warrant issued for their arrest due to an inability to appear for a court date, that guarantees further jail time from the next police encounter. Time going in and out of jail, as well as a desire to avoid police contact, sudden detox, and incarceration, can contribute to people experiencing chronic homelessness not obtaining health care and other needed or wanted services. This cycle is extremely harmful to individuals, costly to state and local governments, and will require systemic change to break.
Homelessness is often criminalized, whether explicitly (making it illegal to sleep in public spaces) or implicitly (charges people experiencing homelessness often cannot help, such as trespassing, asking for donations, noise, or public intoxication). This makes it inherently challenging for those without stable housing to avoid encounters with the criminal legal system, which in turn makes it more difficult to subsequently secure stable housing.
The Denver SIB has shown that housing can be a pathway to justice and that investing in Housing First rather than racially biased, reactive and often punitive resources is transformative for both individuals and municipal governments. Three years after receiving supportive housing through the SIB, participants experienced eight fewer interactions with the police and four fewer arrests compared to people receiving usual services in the community.
It follows that SIB participants also spent less time in jail. Again, in the three years after being housed and offered services, individuals were sent to jail about two fewer times and spent an average of 38 fewer days in jail compared to their peers who were not referred to the SIB.
Denverites referred to supportive housing through the SIB also used city-funded detox services less often. These emergency detoxification services are largely short-term, costly to provide, and are not designed to offer the kind of ongoing supports that can be critical for people to successfully end their substance use—in contrast to the consistent care provided through supportive housing. Through three years of supportive housing, SIB participants experienced a 65% reduction in city-funded detox services.
Additional health benefits and cost savings—and next steps
In addition to the significant implications for involvement with the criminal legal system, 77 percent of participants in the Denver SIB remained stably housed after three years. Participants also received an additional year and a half’s worth of housing assistance, used fewer emergency health services and received more office-based care compared to those receiving services as usual in the community.
All of this adds up to a sound investment of resources. More than half the total, per-person annual costs of the Denver SIB were offset by reduced expenditures in other areas, with two of the most significant reductions occurring in jail and court costs. This may have particular implications for the BIPOC and especially Black communities who are overrepresented in the city’s incarcerated population. The Urban Institute estimates that to serve the 1,200 Denverites experiencing chronic homelessness in this way would cost $14.6 million to $18.7 million each year, with $9.5 million being offset by other savings.
While this would mean unprecedented levels of public investments, the evidence suggests—and meaningfully advancing racial equity demands—this is change worth pursuing in Denver and throughout the country. Denver’s SIB adds to the growing body of evidence that stable housing is foundational to individuals’ ability to obtain care, address challenges like mental health and substance use, and pursue employment or education—all contributing to the ability to break the homelessness-jail cycle and prevent further individual and societal harms. Such person-centered interventions are essential to better serving the BIPOC individuals, families and communities long most-harmed by chronic homelessness and the criminal legal system, even as decision-makers must also dismantle the racially motivated policies and practices that have created current inequities.
We encourage all who believe in creating a just society to read, discuss, and share the PARE blog series as we learn and act to address the impacts of housing policies on racial equity in America. We also invite you to join us in this conversation, by suggesting additional topics and sharing resources for how we can advocate for greater racial equity. If you’d like to offer feedback on our body of work, please reach out to the Public Policy team. You can also check out our blog and subscribe to our daily and bi-weekly policy newsletters for more information on Enterprise’s federal, state, and local policy advocacy and racial equity work.