Gerald Hall’s apartment is located in the Los Angeles neighborhood known for its homeless encampments: Skid Row.

“There used to be more people there,” he said, pointing to a bare sidewalk between rows of tents and makeshift shelters in front of his apartment complex.

He, like many others, is skeptical that state and local leaders will ever find a real solution to a problem that has plagued the city for generations. Asked if he thinks the situation will improve, he responds: “What is better? »

“Fewer people living on the streets,” said Scripps News correspondent James Packard.

“It’s going to look like that. They’re definitely going to make it look like that,” Hall responded.

Skid Row is surrounded by service providers who work every day to do more than make it “look” better. They are trying to actually reduce the homelessness crisis. But John Maceri, who runs The People Concern, a nonprofit in Los Angeles, says organizations like his face a challenge for which they have no clear solution, and that it’s not a matter of not homelessness; it’s a debt.

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“Every month we get deeper and deeper into the hole,” he said. “Frankly, I don’t expect any significant relief in the short term.”

Organizations often contract with the government to provide services like housing. The government agrees to pay part of this cost, usually most of it. But that doesn’t pay upfront. It reimburses the receipts in the end.

This means that the organization turns to a bank for a line of credit. The problem is that government reimbursement is slow to materialize.

“Oftentimes what happens is the payment doesn’t arrive until three to four months late,” Maceri said. “So we’re in this continuous cycle of financing, waiting to get paid and being in debt at the same time.”

Maceri said The People Concern can be hired to do work costing double what it has available through its $9 million line of credit.

“We pay $63,000 a month in interest,” he said.

This is money the organization must raise privately. Instead of raising money to provide more services to homeless people in Los Angeles County, it’s raising money to pay interest — interest that the government won’t pay back.

The people’s concern is far from being the only one. Other nonprofits face the same challenge. For organizations fighting homelessness, the problem has become particularly pronounced since Los Angeles County voters passed Measure H, a funding source for homelessness solutions that took effect in 2017.

“Measure H obviously brought a lot more resources to the Los Angeles County homeless services system and providers ended up bearing more and more of these costs to the extent that it can impact their flow of cash flow and their ability to maintain healthy balances,” said Paul Rubenstein, deputy director of external relations for the Los Angeles Homeless Services Authority. LAHSA administers government funds to organizations fighting homelessness.

This puts at risk work like Lamp Lodge, a permanent supportive housing complex near Skid Row run by The People Concern.

“I feel like a lot of the time this population is…it’s very easy for them to slip through the cracks,” said Ivette Little, program manager at Lamp Lodge.

Little showed Scripps News one of the units provided by Lamp Lodge, containing a mattress, a dresser, a table with chairs and a minimally equipped kitchen.

“It’s based on income,” Little explained. “They pay 30% of their income, so it could be, you know, 0 income, they pay 0.”

But the speed of benefit reimbursement won’t necessarily be solved by adding additional staff to administrative work, according to Rubenstein.

“The staff doesn’t matter as much as the number of steps to go through,” he said.

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Rubenstein said a new model for advancing money to entrepreneurs could ease the pressure.

“They are still required to submit the invoices and all the documents that they had before, and if they do not submit the documents in a timely manner, then the advances stop,” he said. “Accountability is maintained, but the impact on their cash flow, their ability to make payroll, is significantly reduced.”

The nagging question for John Maceri is: will this be enough?

“I’m very concerned that, you know, among our partners and our colleagues, all organizations are evaluating what they are capable of continuing to do,” he said.

A measure passed Tuesday in Los Angeles County could dedicate $1 billion a year to homeless services indefinitely, but experts like Maceri say that won’t be enough to solve the debt problem.

But Paul Rubenstein thinks this new approach could be the solution.

“We really hope that the new advanced model will resolve the late payment issues and that it will take into account the increase in resources, because as contracts increase, advance amounts will also increase,” he said. declared.

The question is whether Los Angeles is finally close to finding the recipe to resolve a generations-old crisis and appease skeptics like Gerald Hall.