Sacramento councilmember calls motel housing program a ‘failure.’ Here’s why
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- Audit finds only 33% of motel shelter program participants gain stable housing.
- City spent $28M on program since 2020; housed 3,400 people in four years.
- Poor data tracking and prolonged stays limit program effectiveness and turnover.
A Sacramento motel shelter program meant to help homeless families during the pandemic has become a costly and mismanaged system failing to deliver on its promise, according to a new city audit.
The audit, presented at Tuesday’s City Council meeting, found that the city had spent more than $28 million and housed 3,400 people since the program’s inception in December 2020.
Originally intended as emergency housing during the COVID-19 crisis, the city’s motel shelter program now consists of roughly 40% of the city’s total shelter capacity with an average of 550 beds.
Only about a third of participants who exited the program transitioned to stable housing during the first four years — a number that only worsened with those who stayed longer than six months. That percentage is on par with the 32% national average and higher than other agencies in the state including in Los Angeles, San Francisco and Santa Cruz, said City Auditor Farishta Ahrary.
Still, Councilmember Lisa Kaplan called the number a “failure.” She urged further accountability on the homeless providers and better strategies to exit people into long-term housing.
“I don’t think Sacramento should be average,” Kaplan said. “I think we should be above.”
Sufficient affordable housing remains an issue in Sacramento and cities across the state. A single unit of affordable housing in capital region costs at least $500,000, according to previous Bee reporting.
One of the audit’s findings showed that the program is dealing with extended stays and reduced turnover of motel rooms. Some participants have been with the program more than 1,400 days, or nearly four years, said Ahrary on Tuesday.
Data presented in the audit found that positive exits — generally referring to a successful transition to more stable living — occur within the first six months.
“There’s a strong momentum early in the participants’ stay, especially in the first months,” Ahrary said. “If a participant doesn’t exit within those first few months, their chances of exiting quickly decreases.”
Other audit findings included issues with room conditions, inaccurate or incomplete data entry and that the city paid some invoices from service providers without documentation. In one instance, the audit found that the city reimbursed furniture for individuals not enrolled in the program and living in Los Angeles.
The provider, Step Up On Second, has since reimbursed the roughly $6,750.
“It’s very unacceptable that we had an organization use the funds for the city to buy furniture in Southern California,” Kaplan said. “I don’t want to see that happen again.”
Last year, the council approved a series of audits on the city’s homelessness response. This first audit on the motel shelter program, which mainly serves families, spans from December 2020 to December 2024.
Some council members noted that much of the audit was conducted before Brian Pedro, the director for the Department of Community Response, began overseeing the city’s homelessness services. Pedro started his position in late 2023.
Since that time, Pedro said the department has administered some of the changes recommended in the audit including implementing a monthly report from service providers to track information “more tightly.”
“It supports everything that we have already been talking about,” Pedro said in reference to the audit.
In recent months, Pedro has led the charge in restructuring contracts with homeless providers, scaling back resources to congregate housing shelters and focusing on building interim housing micro-communities. He has also expressed support for charging people a fee for some shelter programs.
Pedro brought up the idea again on Tuesday night, saying it could be a strategy for people who remain in shelter programs for an extended period. He has suggested about 30% of a person’s income, noting many receive supplemental security income.
“That’s why I’ve always recommended we have that area for them to not be out in the street and have a roof over their head,” Pedro said.
McCarty said a discussion on charging shelter fees will return to the council at a later date.
This story was originally published June 25, 2025 at 12:58 PM.
