How NYC’s homeless ‘charities’ cash in — ruthlessly

It was a good hour into his State of the City speech Thursday before Mayor Bill de Blasio addressed homelessness — though he didn’t say much about it. “It’s what we have to do,” he averred. “We have to end homelessness as we know it.”

You’d think this was de Blasio’s inaugural statement on the topic, as though he hasn’t been mayor for six years, presiding over record numbers of homeless people living in shelters, on the streets and in the subways. But de Blasio does in fact have a clear track record on homelessness; it’s just so dismal — so tainted by waste and scandal — that it’s no surprise he doesn’t want to dwell on it.

Spending has skyrocketed across the board since de Blasio took over City Hall, but no government expenditures have soared as fast as homeless services, which more than doubled since 2014, from $1 billion to $2.1 billion.

This growth far exceeds the administration’s optimistic predictions of restraint and indicates the extent to which de Blasio throws money at problems, perhaps hoping if they don’t go away, then at least he will have bought off folks in a position to criticize him.

Turns out that an increasing amount of the city’s homeless budget goes to service providers — the groups that run shelters and intake centers, conduct outreach and offer specialized treatment to people on the street. Yet given the enormous demand for shelter, numerous regulations on services and difficulties dealing with the city, it’s hard to find top-quality, scrupulously ethical providers.

At the same time, with more than a billion dollars a year flowing to this sector, the city can’t seem to ensure that standards are met, while well-positioned insiders — call them nonprofiteers — soak up public money.

Indeed, the system has been working great, if you are on the receiving end of the money stream. If you are a homeless or needy person, not so much.

Take Childrens Community Services, for instance. It’s a Queens-based homeless-services provider now under federal criminal investigation for possibly bilking the city of millions of dollars in fake claims and self-dealing. Board members of the organization appear to own its primary vendors, an illegal practice that lets insiders make money coming and going. CCS has received hundreds of millions of dollars in city funding since 2014, shortly after it was founded.

Stealing money would be one thing if CCS were at least doing what it’s paid to do, providing adequate shelter for down-at-the-heel New Yorkers. But the organization’s competence has been in question from the start.

In 2017, CCS lost a major contract to provide services to homeless families at Manhattan hotels, and a recent review found that the group was sheltering children in substandard accommodations, receiving its third “poor” inspection rating.

Nevertheless, the de Blasio administration continued to shovel millions into CCS’s coffers, even as it provided babies with broken cribs and unsafe places to play.

CCS isn’t the only bad actor in the city’s social-service industrial complex. Bronx-based powerhouse Acacia Networks — which has taken in close to a billion dollars in city funding since 2010 — garnered attention after a grisly murder in one of its Upper West Side shelters.

This came on the heels of a revelation that Acacia executives had unreported ties to the security firm it hired to monitor its facilities and ensure the safety of the residents; insiders may also have proprietary ties to other vendors, too. Acacia “cluster sites,” which also house homeless families, have hundreds of outstanding violations.

Yet the organization is politically connected — former Bronx Council Member Maria del Carmen Arroyo left her elected post for a cool quarter-million salary as an Acacia VP, though that’s peanuts compared to the $800,000 stipend pulled down by CEO Raul Russi.

After decades of lax management and poor oversight, in 2017 the city brought homeless services back under the purview of its massive Human Resources Administration, helmed by former Legal Aid honcho and de Blasio ally Steven Banks. The move was supposed to streamline operations. Ha!

Fact is, the city’s major homeless-service providers have been cashing in. And it isn’t at all clear that Team de Blasio has done anything to improve life for homeless New Yorkers — or properly oversee the people getting rich by sheltering them.

Seth Barron is associate editor of City Journal. Twitter: @SethBarronNYC