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VA tried to reallocate $460 million earmarked for homeless veterans. Now it says that won’t happen.

Flags are hoisted at the Los Angeles encampment of homeless veteran Kendrick Bailey on Nov. 10, 2017. (Frederic J. Brown/AFP/Getty Images)

The Department of Veterans Affairs appears to be backtracking on its divisive plan to reallocate nearly a half-billion dollars from a successful program to reduce homelessness among former military personnel, bowing to pressure from lawmakers and advocacy groups who criticized the effort as cruel and counterproductive.

The about-face, announced in a statement Wednesday night from VA Secretary David Shulkin, followed a Washington Post inquiry about the Trump administration’s effort to divert the funding — totaling $460 million — instead to local VA hospitals for discretionary use. As Politico first reported, that money had been set aside specifically for a voucher program, run by VA and the Department of Housing and Urban Development, that provides long-term living accommodations for the country’s most vulnerable military veterans, many of whom suffer from mental illness.

“There will be absolutely no change in the funding to support our homeless programs,” Shulkin’s statement said. “… Over the next six months, I will solicit input from our local VA leaders and external stakeholders on how best to target our funding to the geographical areas that need it most. Based on that input we will come forward with proposals for fiscal year 2019 on how to improve the targeting of our homeless program funding.”

The announcement also follows an emotional “emergency” phone call that VA leaders had Dec. 1 with Housing and Urban Development Assistant Secretary Neal Rackleff and 150 veterans advocates. The group complained that shifting resources, as detailed in an internal VA memo distributed this fall, “would drastically undercut what was a real success story,” said Elisha Harig-Blaine, a leader with the nonprofit National League of Cities who was on the call. 

“It’s just unconscionable to take this action without consulting HUD or the many mayors who have been working so hard on this,” Harig-Blaine said. “The former troops who used these vouchers are the most likely to die on American streets.”

Shulkin faced additional pressure from the Senate Appropriations subcommittee on military construction, veterans affairs and related agencies. All 14 members signed a strongly worded letter, dated Nov. 7, urging VA to reconsider its decision — a rare demonstration of bipartisan unity. “The shift,” lawmakers warned, “could have tremendous unintended consequences.”

Sen. Patty Murray (D-Wash.), a member of the subcommittee, called the move “mean-spirited and wrong.”

Since 2008, about 138,000 homeless veterans found permanent housing because of this program, known as HUD-VASH, according to government data. And since 2009, veteran homelessness has been down by about 45 percent, progress that many have attributed to President Barack Obama’s pledge to boost funding targeting the problem.

On Wednesday, HUD announced that between 2016 and 2017, the number of homeless veterans rose 2 percent, or by about 600 people, the first increase since 2010. Many live on the West Coast, where rents have soared faster than incomes, HUD officials said.

Curt Cashour, a VA spokesman, said earlier Wednesday that allowing local hospitals to use these funds as they wished was “about strengthening the ability of local VA leaders, who know their neighborhoods and Veterans best, to serve Veterans locally.”

“While some may think Washington bureaucrats are more qualified to make decisions about local VA issues than local VA leaders,” he added, “we wholeheartedly disagree.”

The funding uncertainty has created problems for veterans advocates like Leon Winston, chief operating officer for Swords To Plowshares, a nonprofit in Northern California. He had been seeking funds for 100 HUD-VASH vouchers but was able to secure only 50.

“The human impact is that 50 fewer vets in San Francisco will be able to get vouchers through HUD-VASH and, well,  it sucks,” Winston said. “There was a big effort to end homelessness, and this indicates we as a nation are taking our foot off the gas pedal.”

Read more:

Transcript: Veterans in America — A Conversation with VA Secretary David Shulkin 

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