Part 172: LA Alliance Evidentiary Hearing? A Homelessness Receivership is Coming to Los Angeles

Published May 21, 2025.

and

May 22, 2025

Photo of graffiti and fencing in downtown Los Angeles on First Street where encampments once existed near City Hall by Zachary Ellison (GoPro Hero 11 Black).

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By Zachary Ellison and Ruth Roofless, Independent Journalists

For more than 4 years now, the LA Alliance for Human Rights has sought to (as one source suggested) all but “bully” the City and County of Los Angeles to take substantive action to reduce homelessness. Now the hearings that have followed have taken a new dramatic legal turn with the scheduling of an “evidentiary hearing” to determine if the City of Los Angeles is in breach of its settlement agreement with the nonprofit group funded largely by the downtown business establishment. Scheduled to begin on May 27, the planned hearings will put LA one step closer to the enactment of a receivership. Who that receiver will be remains unclear, with the LA Alliance now suggesting Special Master Michele Martinez for Judge David Carter, who presently monitors the settlement alongside retired Judge Jay Gandhi, be appointed to the position.

Gandhi recently stepped down to serve Carter on the Veteran Affairs case (Powers v. McDonough) after suing the city’s Department of Water and Power “DWP” over the loss of his own home in the Palisades Fire. The LA Alliance previously had floated the name of attorney Ken Feinberg to be appointed to the receivership, which would act as an overseer for at least funding, if not operations, of Los Angeles’ spending on homelessness. Those funds, at least for now, continue to go to the Los Angeles Homeless Services Authority (LAHSA), from which the County of Los Angeles recently withdrew funding of at least $300 million in favor of a new dedicated response agency that has yet to be launched but is slotted for July 2026.

Martinez, in her second report as special master, suggested the appointment of a financial monitor. LAHSA CEO Dr. Va Lecia Adams Kellum remains, despite having announced her resignation, as pressure has mounted against her leadership. Tens of thousands continue to live openly on the streets. Judge Carter finalized the recent audit by Alvarez & Marsal that was led by Dianne Rafferty after the prior hearing on March 27 saw elected officials raise questions about the “methodology” employed. That was before the news got worse for Mayor Karen Bass, who was instrumental in the hiring of Adams Kellum after bringing her on as a high-priced consultant for her signature shelter program, Inside Safe.

In its filing prior to the hearing, attorney Elizabeth Mitchell, writing for the Alliance, characterized the program as “wildly expensive,” citing costs “at up to $281 per night ($102,565 per year) for one person in addition to significant repair costs from tenant-caused damage.” Mitchell’s math in the initial Alliance complaint compared unadjusted 90-day and six-month figures for congregate shelters to year-round rates.

She held up the total cost per unit of brand-new construction without differentiating between operating and acquisition/construction expenses. It has never been clear if she has a shelter solution in mind that is actually more economic. Even the Pallet shelter product she hailed as costing “$2,000 per bed” ended up costing $65,000, not including operating expenses. A bunk in a room of 100 beds may be cheaper than a motel room on paper, but if no one wants to be there, it’s a waste of money. Mitchell seems content with emergency accommodations being implemented on a basis that becomes permanent, sacrificing quality of life for savings that may end up being insignificant, and wholly unconcerned about permanent housing.

In her filing on behalf of the LA Alliance, Mitchell in analog compared the issue of housing to ordering pizzas, writing, “The real-world equivalent would be if two people decided to pay for 10 pizzas for a total of $100. Person A paid $30 and Person B paid $70; combined they achieved a total purchase of 10 pizzas. But under no interpretation of the event could Person A claim to have purchased and provided all 10 pizzas.” How reasonable?

Whether the Alliance is ultimately a friend or foe of the unhoused remains to be seen, but at least for now Governor Gavin Newsom has cast himself in the latter role (depending upon whom you ask) in releasing a “model ordinance for cities and counties to address unhealthy and dangerous encampments.”

Newsom didn’t attend the hearing as requested and cited the release of $3.3 billion in funding from Proposition 1 to justify the move while citing the Supreme Court’s 6-3 decision in Grants Pass v. Johnson last June to allow the criminalization of homelessness, even in the absence of available shelter. After objection to the idea of compelling testimony from so-called apex witnesses, the City Attorney’s Office under Hydee Feldstein-Soto declined to have Mayor Bass or Council President Marqueece Harris-Dawson attend.

Allowing attorney Elizabeth Mitchell to all but put the City of Los Angeles on trial over its failures in addressing the crisis of the unhoused seems unlikely to produce the intended result. The LA Alliance, for all its bluster, can’t alone reform a system that almost everyone agrees is not working effectively to produce a policy solution that succeeds. Maybe getting everyone in a room cross-examining each other, presenting evidence, and calling witnesses is the energy we need to get out of this unproductive cycle of hearings and audits, which has only made people on the streets feel farther away from solutions. If U.S. Judge David O. Carter called another hearing on San Pedro Street, would it feel vintage?

Los Angeles didn’t always have so many people living on its streets, but draft figures from the 2025 count (obtained from LAHSA via the California Public Records Act) show a reduction in the total number of tents, vehicles, and makeshift dwellings for the second year in a row. The numbers finally resemble the pre-pandemic situation of 2018-19.

At the Federal Courthouse last Thursday, a slide that began under former Mayor Eric Garcetti, depending on who you ask, may or may not be finally getting better. Garcetti no longer serves as ambassador to India under President Donald Trump, who recently ordered the construction of 6,000 housing units at the West Los Angeles Soldier’s Home by executive fiat after an effort to do the same by Judge Carter stalled in the Ninth Circuit Court of Appeals.

Whether Trump’s move ultimately resolves a standoff over leases with the Brentwood School, Bridgeland Energy, and the University of California, Los Angeles “UCLA” over the tenancy of multiple baseball stadiums and a toxic drilling operation remains to be seen. Carter had all but vowed to bulldoze the sports facilities and cap the oil wells to get more housing for veterans built on the sprawling federal holding, if needed. Is he still as focused?

Last November, voters in Los Angeles County not only approved County Measure A after voters across California approved Proposition 1 the prior March. Money alone, though, can’t solve the problem. The U.S. Attorney’s office for the Central District of California, now under Bill Essayli, recently cited spending statewide of “more than $24 billion over the past five years to address homelessness.”

This is especially so with increasing mistrust of a panoply of homeless service providers that LAHSA has struggled to track and monitor and with questions about the conduct of LAHSA under Adams Kellum and prior leadership swirling thanks to effective investigative reporting by LAist, which has a team including Nick Gerda working to expose her leadership as allegedly cronyism and intentionally misleading on the number of available beds.

LAHSA unquestionably has thousands of beds in its system, which it struggles to inventory, that are now presently sitting empty. The joint-powers city-county agency is working to bring online a system in July that would improve the ability of case managers to assign clients to beds more quickly. If LAHSA operated effectively, with its existing capacity, it could potentially bring thousands off the streets.

On April 25, according to LAHSA’s own presentation at their Commission meeting “LAHSA has 11,754 total funded/beds, of which only 5,809 are currently matched.” Moreover, “An additional 10,000 units/beds from DMH (Department of Mental Health), DHS (Department of Housing Services), City-ISP (Inside Safe Program), County-PWH (Pathway Home), and VA GPD (Grant and Per Diem Program) are unmatched.”

In short, the system as a whole is failing the people it’s supposed to serve. LAHSA’s system for prioritizing care is similarly broken, with “5,945 units/beds…not being prioritized based on criteria, such as vulnerability and location.” Despite having extensive outreach operations, “Participants must physically visit an access point, arrive at an interim housing site, or call Service Providers daily to access a unit/bed.”

LAHSA is working to centralize “all LAHSA funded bed data within the IH Inventory Module.” Some people say the biggest barrier to effective care is mental health and substance abuse issues. The Executive Committee for Homeless Regional Alignment (ECHRA) recently created a Best Practices for Standardization of Care (BPSC) subcommittee to set goals for such issues as required by voter-approved County Measure A.

Much like the goals announced overall for the new funding, the intention is ambitious, with experts organized before Nithya Raman coordinated by consultant Sarah Solon from HR&A Advisors believing in the work they do. Yet belief, practice, and reality are often quite different from measurable results. Los Angeles undoubtedly wants to get out of the crisis of the unhoused, but can it achieve these goals in a way that everyone can agree represents success? A spokesman for LAHSA didn’t respond to a request for comment on its empty bed problem. Putting this failing system on trial may be a necessary legal step toward receivership, but that alone won’t fill a single additional bed with someone who needs and wants assistance.

Judge André Birotte Jr., who has assisted Judge Carter with the sprawling LA Alliance case, has re-entered the frame for the upcoming evidentiary hearing. In resigning his position as a Special Master, retired Judge Jay Gandhi wrote Carter, “The work to end this crisis is not only a policy imperative, it's a moral one.” The new proceedings will force the congenial Carter to take a step back from his often informal contacts with elected officials and parties walking Skid Row.

Supervisor Kathryn Barger, who attended, met with the A&M audit team, as did representatives from the City of Los Angeles, to finalize the audit. There were no material changes made from its second draft. The core findings remained the same, with Rafferty describing how “There's too many gaps and there's old data systems, and it's really hard to just patchwork it because it becomes -- you solve one problem and then you don't solve another.” Rafferty added, “That's not saying to replace every single person, but the processes are extremely broken.”

Link: LA Alliance for Human Rights

Link: Court auditors say LA homelessness services are 'extremely broken'

Link: Dkt. 904 Special Master Independent Monitoring Report and Recommendations No. 2

Link: Dkt. 905 Alvarez and Marsal Independent Assessment of City-Funded Homelessness Assistance Programs

Link: Dkt. 899 LA Alliance Response Re Issues Raised by Court on March 27, 2025

Link: Dkt. 903 City Objections to LA Alliance's Response Re Issues Raised by Court on March 27, 2025 [899] and Request for Apex Testimony

Link: Ambassador Garcetti’s Tenure Concludes

Link: KEEPING PROMISES TO VETERANS AND ESTABLISHING A NATIONAL CENTER FOR WARRIOR INDEPENDENCE

Link: Jeffrey Powers, et al. v Denis Richard McDonough, in his official capacity as Secretary of Veterans Affairs; et al.

Link: United States Attorney Bill Essayli Announces Criminal Task Force to Investigate Fraud and Corruption Involving Homelessness Funds

Link: Whistleblowers say LA’s top homeless official hired unqualified friends, tried to destroy public records

Link: LA city officials told a court they were adding new beds for unhoused people. But auditors couldn’t verify over 1,400 of them