Key Takeaways
- The results of the Homelessness Prevention Call Center study suggest that funding availability has an immediate and significant impact on the likelihood a caller will experience homelessness.
- If funding was available at the time of the call, the caller was 88% less likely to be homeless after 3 months and 76% less likely after 6 months.
- Calling when funds were available also reduced the time spent in a homeless shelter over the next 6 months by 2.6 days, or 84%.
- The evidence suggests that emergency financial assistance programs would be more effective if they specifically targeted the lowest-income households.
- Researchers estimate that the cost of a single homeless spell is around $20,548. But the cost of averting homelessness through outreach like emergency financial assistance is estimated at $10,300—well below the cost of homelessness.
- In similar studies, LEO researchers find that callers who receive funding through the Homelessness Prevention Call Center are 51% less likely to commit a violent crime, and 36% less likely to need healthcare as a result of an assault.
Mechanics
The Homelessness Prevention Call Center connects callers who are experiencing an immediate housing crisis with organizations that can provide emergency financial assistance. To measure the impact of emergency financial assistance in Chicago, researchers used Chicago’s Homelessness Management Information System data from 2010 to 2012. Because the amount of funding organizations have to prevent homelessness varies from day to day, fund availability served as a way to randomly allocate financial resources to those seeking assistance.
Each year, the Homelessness Prevention Call Center processes about 75,000 calls. For this study, LEO researchers analyzed a sample of 4,448 calls—3,574 for rental assistance and 874 for security deposits. In total, 58.2% of callers were referred to organizations that provided them with funds.
What We Learned
The Homelessness Prevention Call Center study is the first in the literature that directly investigates the impact of emergency financial assistance on reducing homelessness. The results suggest that funding availability has an immediate and significant impact on the likelihood a caller will experience homelessness. LEO researchers were especially interested in the effect of funding availability on two key measures of homelessness– whether a caller enters a homeless shelter within 3 or 6 months after the call, and the number of days they spend in a shelter 6 months following the call.
They found that funding availability led to a 1.4 percentage-point decrease in the probability of entering a homeless shelter within 3 months of a call and a 1.6 percentage-point decrease in the probability of entering a shelter within 6 months. That’s an 88% decline in the likelihood of being homeless after 3 months and a 76% decline in the likelihood after 6 months. The results also show that calling when funds are available reduced the time spent in a shelter over the next 6 months by 2.6 days, or 84%. Though the study finds that funding availability decreased the likelihood a caller entered a homeless shelter by 76%, the results suggest that fund availability had only a small effect on the length of time an individual spent in a shelter if they had already entered.
When researchers analyzed the impact of funding availability by the characteristics of callers, they gained a number of key insights. Primarily, single adults, males, callers younger than 30 years of age, and those who called during the winter months were more likely to benefit from emergency financial assistance. The results also suggest that for callers seeking rental assistance with incomes at or below 90% of the federal poverty line, calling when funds were available reduced the likelihood of entering a shelter within 6 months by 88%. But there’s little evidence that financial assistance impacts homelessness for those with incomes over 90% of the federal poverty line. This supports a common criticism of emergency financial assistance programs--that individuals who would not end up homeless even in the absence of receiving help are often eligible to receive financial assistance through programs like the Homelessness Prevention Call Center.
This leads to an interesting discussion on cost. The evidence suggests that emergency financial assistance programs would be more effective if they targeted groups that benefit more from financial assistance, such as individuals and families with very low incomes. Researchers estimate the per-person cost of preventing homelessness is about $10,300 for all of those included in the study. However, the cost of averting homelessness for the lowest-income callers is about $6,800, or 35% less than the per-person cost among all eligible callers. Because the cost of reducing homelessness for these low-income individuals is much lower than for other callers, they experience greater benefits from receiving emergency financial assistance.
Still, regardless of income level, homelessness is expensive. After adding the costs of mortality, health care, incarceration, welfare programs, and shelter, a conservative estimate for the cost of homelessness is $20,548 per spell—the $10,300 cost of averting homelessness through programs like emergency financial assistance is well worth the price.
Between 2010 and 2012, LEO researchers also matched 8,655 call records of the Homelessness Prevention Call Center with arrest records from the Chicago Police Department to explore the impact of financial assistance on crime outcomes. The results indicate that receiving emergency financial assistance not only reduces the likelihood an individual will enter a homeless shelter, but it also reduces the likelihood they will engage in criminal behavior. Those who receive funding are 51% less likely to be arrested for committing a violent crime. Researchers attribute this decline to greater housing stability. Still, the results suggest that receiving financial assistance increases the likelihood an individual will be arrested for property crime—this may reflect that individuals take on unrealistic financial obligations as a result of receiving financial assistance.
In a subsequent study between 2013 and 2017, LEO researchers matched 8,585 call records with hospital records from the Illinois Department of Public Health to learn how financial assistance impacts health outcomes. The results indicate that, although receiving emergency financial assistance does not significantly change overall healthcare use, it does reduce the likelihood that a person will seek healthcare as a result of a violence. Those who receive funding are 36% less likely to make a healthcare visit associated with an assault. The study results also suggest that receiving emergency financial assistance may result in fewer suicide attempts.
Where We’re Going
Following the completion of this study, a lack of state funding in Illinois jeopardized the future of the Homelessness Prevention Call Center. However, with rigorous evidence in hand, LEO researchers and staff members of Catholic Charities Chicago effectively defended the program and preserved its funding—enabling Chicago residents at risk of falling homeless to access the assistance they need.
Because the study results suggest that the lowest-income callers benefited the most from emergency financial assistance, the program impact could be improved by targeting funding to those who need it the most.
The full results of the Homelessness Prevention Call Center study were published in Science Magazine in 2016, and the study exploring the impact of financial assistance on crime was published in the Journal of Public Economics in 2019.
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