Long Beach has contracted with a new organization to oversee and manage homeless services at city-run shelters, according to a Wednesday, April 1, announcement, ending its relationship with nonprofit First to Serve amid an ongoing investigation by the City Auditor\u2019s office.<\/p>\n
Long Beach has contracted with First to Serve, a Los Angeles-based nonprofit organization founded in 1996, to manage and operate its homeless shelters since 2022. But, because of \u201ccontract compliance issues\u201d identified by the city auditor\u2019s office, according to the city\u2019s announcement, the organization has been ousted from its role.<\/p>\n
First to Serve officials did not respond to a request for comment on Thursday, April 2.<\/p>\n
City Auditor Laura Doud\u2019s office, alongside the Department of Health and Human Services, initiated a review of the department\u2019s homeless services funding in May 2023, according to the Wednesday evening announcement.<\/p>\n
More than $69 million in federal, state, and local funding passed through the health department\u2019s Homeless Services Bureau between fiscal years 2020 through 2025, according to a summary of Doud\u2019s investigation released on Wednesday.<\/p>\n
\u201cThe audit evaluated whether homeless service providers were fulfilling the services outlined in their contracts and whether (the Homeless Services Bureau) was overseeing these contracts to ensure the funds were spent properly,\u201d Doud\u2019s office said in a statement.<\/p>\n
As part of that review, the city said in its announcement, Long Beach discovered \u201ccontract compliance issues\u201d with First to Serve \u2014 resulting in the city\u2019s decision to cut off payments to the organization in November 2025 and initiate further review into the matter.<\/p>\n
The exact nature of those contract compliance issues discovered with First to Serve, though, are currently unknown, as the city auditor\u2019s review is still ongoing and has not been fully released at this time.<\/p>\n
\u201cDuring our audit, we identified information that requires further review,\u201d Doud\u2019s office said in a Wednesday memo<\/a> to the mayor, City Council and City Manager Tom Modica. \u201cTo protect the integrity of our ongoing investigation, we cannot provide additional details regarding the matter at this time, nor can we discuss our audit in greater detail.\u201d<\/p>\n First to Serve held multiple contracts with the city relating to homeless services since 2022, health department spokesperson Jennifer Ann Gonzalez said in a Thursday, April 2, statement.<\/p>\n The nonprofit was tasked with operating Long Beach\u2019s year-round shelter, managing Project Homekey interim housing operations, and providing homelessness prevention services and rapid re-housing services.<\/p>\n In total, according to Gonzalez, First to Serve was awarded approximately $32.8 million from the city across its various contracts.<\/p>\n \u201cDue to contracts ending early, the total amount eligible to be billed is estimated to be just under $24 million,\u201d Gonzalez said. \u201cThese figures reflect contract award amounts and do not represent the total amount paid to First To Serve.\u201d<\/p>\n While the city auditor has yet to release the full results of the investigation because it is still ongoing, Doud\u2019s office has already provided the health department with recommendations based on the early findings on the audit.<\/p>\n The city auditor\u2019s office, for example, suggested that the Homeless Services Bureau strengthen oversight of its data collection to ensure that data used to evaluate the performance of its providers is accurate.<\/p>\n Other recommendations for HSB included:<\/p>\n Verifying complete documentation before paying out homeless service provider invoices to make sure the contracted services were properly rendered; and Doud\u2019s office also outlined recommendations for homeless services providers themselves, including ensuring that the individuals they serve are eligible for contracted programs; submitting complete and timely supporting documentation for costs they want reimbursed by the city; and providing the services outlined in their agreements with the city.<\/p>\n The Health Department, according to a Wednesday memo from its director Alison King, has also taken several other actions<\/a> to implement the City Auditor\u2019s suggestions.<\/p>\n \u201cThese actions are specifically designed to strengthen regulatory and contractual compliance, improve fiscal and programmatic oversight, establish additional financial controls, and increase overall service quality, performance outcomes and accountability,\u201d King wrote.<\/p>\n Long Beach has already hired on a new organization, PATH, to manage homeless services at city-funded shelters. The city currently offers 443 shelter beds at various locations, including the Colonial Motel, the city said.<\/p>\n People Assisting The Homeless, otherwise known as PATH, is a nonprofit homeless services organization serving four regions, including Los Angeles, Orange, Santa Clara and San Diego counties.<\/p>\n PATH was already working with Long Beach before becoming its provider of homeless services at shelters, the city said, partnering with the health department to provide people experiencing homelessness with supportive housing and interim housing services.<\/p>\n
\nImplementing better accountability measures for HSB service providers through formal interim and year-end performance reviews across all programs.<\/p>\n