Massachusetts is spending around $75 million each month on state-operated shelters, which is a huge increase in costs. The governor's administration is expected to deplete emergency service funds in early to mid-April if they don't receive more money.
Beacon Hill lawmakers have mostly used up the new year forming a plan to cover the escalating shelter expenses amidst lower than expected state revenues, no assistance from Washington, and a continued high demand for services.
With money likely running out before April, the Legislature is currently negotiating a new spending plan to provide funds to Healey at a critical time. Leading budget planners believe they can reach a compromise before they run out of time.
House Ways and Means Chair Aaron Michlewitz mentioned the importance of reaching an agreement on a spending bill “as quickly as possible.”
“I’m optimistic that once we start discussing with our counterparts, we'll be able to come up with a solution before funding runs out,” the North End Democrat told the Herald Friday afternoon.
A spokesperson for the Executive of Administration and Finance, Matt Murphy, did not indicate if the Healey administration has a specific date when the money might run out.
“We don’t have any further updates at this time. We are encouraged by the progress the Legislature has made and look forward to working with them to finalize the supplemental budget as soon as possible,” he said in a statement.
On Thursday, the Senate voted to provide Healey access to up to $840 million over fiscal years 2024 and 2025 to cover shelter costs, while the House previously approved this month a $245 million injection for this fiscal year only. Both bills limit time in shelters to nine months, with different rules for extending stays.
Lawmakers have already given the Healey administration $575 million in fiscal year 2024 to address a shelter crisis worsened by an influx of migrants fleeing dangerous conditions in their home countries.
In a report released last week, the administration stated it had already spent $427 million on emergency shelter services as of March 7. An updated report providing the latest financial figures is expected to be released next week.
Senate Ways and Means Chair Michael Rodrigues believes funding could run out in the first or second week of April, putting pressure on House-Senate discussions about additional shelter spending.
“This current rate of spending is truly unsustainable, and it may further hinder our ability to address urgent needs in the commonwealth if we don’t act. With the federal government's failure to provide aid in this crisis, the burden falls on us in the commonwealth,” he said during a Thursday Senate session.
More than 7,500 families with children and pregnant women are residing in a widespread array of hotels, motels, and traditional shelters across Massachusetts. Half are considered to be migrants.
Some individuals staying in shelters are receiving various services such as medical care, transportation, meals, and legal aid. The Healey administration plans to allocate $932 million this fiscal year and $915 million next fiscal year for emergency assistance shelters.
Previously, the typical capacity of emergency shelters was about 4,100 families and cost taxpayers around $27 million monthly, according to Rodrigues.
That increased to $45 million per month in August 2023 when Governor Maura Healey declared a state of emergency due to rapidly filling shelters, and, as Rodrigues stated, rose again to $75 million per month as new arrivals continued.
The state may be spending up to $78 million monthly on shelter needs in fiscal year 2024, and there are limited options to control the crisis, said Doug Howgate, president of the Massachusetts Taxpayers Foundation.
Howgate emphasized that lawmakers need to intensely focus on managing costs and reducing them to a more sustainable level.
However, if the state were to maintain the anticipated expenditure of around $900 million for fiscal years 2024 and 2025, Howgate mentioned that it would need to be incorporated into the annual budget.
“I believe, in terms of this year's budget, if you had to suddenly increase that allocation by an additional $600 million, which is what would be required to reach the $900 million, you would face extremely difficult decisions and significant cuts to achieve that,” he explained.
During the Senate's debate on the shelter funding bill on Thursday, Rodrigues stated that the state is spending approximately $10,000 per family monthly on shelter.
“The continuous influx of migrants seeking shelter is likely to persist, posing significant challenges for our communities. Currently, the anticipated cost of the state’s emergency shelter program is unsustainable,” Rodrigues remarked.
Kelly Turley, associate director at the Massachusetts Coalition for the Homeless, argued that the $10,000 estimate may oversimplify the monthly costs, which are more complex.
“Funds are allocated to other services,” she stated on Friday. “I believe $75 million per month is correct, but it doesn't necessarily mean that amount is for each family because… it includes funding for welcome centers, the National Guard, clinical assessment sites, and overflow sites.”
