The city of Los Angeles spent only about half of the money it had available for homelessness efforts in fiscal year 2025-26, according to an analysis released Monday by the City Controller’s Office.
According to the study, the homelessness budget for that fiscal year was $961 million, or about $1.1 billion when adjusted for additional appropriations and prior-year carryover amounts. The city, however, only spent $516 million, with another $119 million encumbered — meaning those dollars have been committed but may or may not end up being used, according to the report.
That left about $473 million unspent.
Most of the unspent homelessness money comes from special funds, which typically get rolled over to the next fiscal year to spend again on homelessness-related efforts.
In the 2024-25 fiscal year, Los Angeles did not expend more than $500 million of its $1.3 billion homelessness budget, the controller’s office previously reported. That year, the city only spent $599 million.
According to City Controller Kenneth Mejia, some of the reasoning for the unspent money includes:
— Money that won’t be expended until later years such as some state grants like Homeless Housing, Assistance and Prevention (HHAP) grants won’t be used until future years;
— Affordable housing development funded by Measure ULA can take up to three years for the city to approve;
— Delays in city approvals for spending plans and contracts related to Measure ULA tenant protections, defense, and assistance;
— Lack of staff and resources related to departmental homelessness spending to fully utilize their budget; and
— Homelessness efforts are decentralized — with no one department overseeing initiatives — resulting in further delays.
“For the second year in a row, the city ended up spending much less on homelessness than it promised,” Mejia said in a statement. “Often, most of the unspent money is rolled into the next year’s budget, but there are risks that some funds may be lost to other budget priorities. People need housing and services today, not a year or two from now.”
“The large homelessness budget leads the public to believe that the City is spending much more on homelessness than it actually is, increasing the public’s expectations and causing frustration when results inevitably do not align with the budget,” Mejia added.
Mejia recommended that Mayor Karen Bass and the City Council revisit the way the homelessness budget is set up, noting that they should only appropriate funds that are expected to be spent for the coming fiscal year, as well as to properly categorize homelessness-related expenditures.
The City Controller’s Office is the first entity to formally track city homelessness spending, according to Mejia, beginning in fiscal year 2024-25.
Mejia further recommended that any Homeless Housing, Assistance and Prevention (HHAP) Grants be included or listed in the homelessness budget when the money will be spent.
He added that any unspent Measure ULA dollars should be clearly communicated with the timelines for acquisition and rehabilitation of affordable housing and tenant related services.
Most of the underspend funding relates to tenant assistance, defense, and protections. Mejia encouraged his colleagues to bolster staffing to address delays in contracting and approvals processes.
Additionally, as it relates to Measure ULA, Mejia urged the city to determine if certain Measure ULA spending is rightfully categorized under the homelessness budget since large amounts originally budgeted in the homelessness budget were not spent or encumbered mainly related to tenant related services.
Mejia also emphasized the importance of providing monthly or quarterly updates on homelessness spending.
“Other responsible departments should also give regular updates on their spending plans. The Controller’s Office currently tracks real-time spending and gets monthly updates from departments on homelessness spending. Formalizing these updates will help the city identify issues and bottlenecks to ensure timely utilization,” according to the controller’s report.
In response to the report’s findings, Bass said she was glad to support Mejia’s recommendations for improvement.
Bass, who is seeking reelection for a second term as mayor, touted that under her leadership the city brought homelessness down by 17%, citing figures from the 2025 point-in-time homelessness count.
“We are committed to transparency so Angelenos will have a clear picture and understanding of how much is being spent in one year and what funding is supporting programs over multiple years,” Bass said in a statement. “It’s important that we strategically spend funding over multiple years to ensure we can sustain progress despite state and federal changes.”
City Councilwoman Nithya Raman, who is chair of the Housing and Homelessness Committee, in a statement expressed her frustration, saying that “the city has once again spent far less than its allocated homelessness budget.”
Raman said the issue happened again despite repeated efforts by the City Council to get real-time progress reports of homelessness spending and to centralize homeless oversight.
The councilwoman, who is one of several challengers seeking to unseat Bass, explained that she’s working on establishing a Bureau of Homeless Oversight, which would monitor homelessness spending.
“Nearly a year later, not one staff member has been hired,” Raman said in a statement. “Unless we are able to move with greater urgency to provide accountability to the public, Angelenos will lose faith that the City is spending these desperately needed dollars well.”
Councilwoman Ysabel Jurado, vice chair of the Housing and Homelessness Committee, added the “housing and homelessness crisis demands immediate action, not delay.”