Westside Rag: City’s Unaudited ‘Homeless Hotel’ Program Is Nearly Four Times as Expensive as First Estimated
By Joy Bergmann
September 29, 2020
The City’s contract with the Hotel Association of New York City [HANYC] to provide emergency housing to people experiencing homelessness during the Covid-19 crisis has grown to $299,790,000, an increase of $221,690,000 over the initial $78,100,000 cost cited when the contract began on April 15th, according to Checkbook NYC, a public database of City spending from Comptroller Scott M. Stringer’s office.
The amended contract does not run longer than the original October 12th end date, nor does it list any new parties to the contract. The only apparent change is a modification on August 24th increasing the amount by nearly $222 million. That’s $31,500 for each person housed in the hotels, on average — and it doesn’t include services.
Four Upper West Side hotels have been providing emergency shelter to hundreds of people experiencing homelessness during Covid-19: Hotel Belleclaire, Belnord Hotel, Park West Hotel and The Lucerne Hotel.
WSR asked the NYC Department of Homeless Services [DHS] for an explanation of the cost increase and information on the percentage of the contract to be paid out of the City budget versus by other governmental entities like FEMA, the U.S. Federal Emergency Management Agency.
We did not receive direct answers.
Instead, DHS provided a briefing document which delineated the following:
The HANYC contract only covers the cost of the rooms; the average nightly rate being paid is $120 per room. Prior to Covid-19, the average rate DHS had been paying to house someone in a commercial hotel unit was $174 per room.
No payments to shelter service provider agencies are covered by this $299 million.
There are 60+ NYC hotels providing emergency shelter due to Covid-19. [That number doesn’t seem to have changed much since NY1 noted 63 participating hotels in a story on June 25th.]
Approximately 9,500 individuals were moved from congregate shelters into emergency hotel housing due to Covid-19.
The document says, “The $78M HANYC contract from earlier this summer reflected the initial part (i.e. only a portion) of the work we have comprehensively outlined here…We adjusted our contract with HANYC to reflect the full scope of work necessary to protect the New Yorkers we serve.”
WSR emailed HANYC seeking comment on the modified contract. If we hear back, we’ll update this story.
WSR also asked the NYC Comptroller’s Office for comment on the contract and its City budget implications. A spokesperson told WSR that the Comptroller’s Office did not review or register the HANYC contract, nor any of its modifications, per the Mayor’s Emergency Executive Order #101 suspending laws and regulations related to procurement during the pandemic in New York City.
The day after the HANYC contract was modified, on August 25th, the Comptroller’s Office did issue a press release calling on Mayor Bill de Blasio to restore checks and balances to the procurement process. In it, Comptroller Scott M. Stringer said, “As we emerge from the darkest days of the pandemic and build our city back, it’s time to restore full oversight and accountability to city contracting. The Mayor needs to rescind this executive order so we can ensure that every dollar we spend is delivering for New Yorkers.”
Neha Sharma, a spokesperson for NYC Department of Social Services – Department of Homeless Services, provided the following statement on the next steps for the hotel program. “We’re watching our health indicators closely and working with the Department of Health and Mental Hygiene to determine when and how clients can be safely relocated back to shelters from the temporary hotel relocation sites, and we’ll inform communities when our City is ready to take that step. Pre-COVID we had been driving down commercial hotel use as we announced we would, and we have no plans to continue using emergency relocation hotels on an ongoing basis.”