Judge Slams LA’s Homeless Services: “No Accountability” as Billions Remain Untracked
A federal judge has raised serious concerns about the oversight of Los Angeles’ homeless services, saying he “distrusts” financial reports provided by service providers and has “grave doubts” about the city and county’s ability to monitor spending.
During a court hearing on Thursday, U.S. District Judge David Carter reviewed findings from an independent audit that examined spending on three major homelessness programs, including Mayor Karen Bass’ Inside Safe initiative. The audit, conducted by Alvarez & Marsal (A&M), analyzed $2.3 billion in funds and found widespread mismanagement, lack of oversight, and incomplete financial records.
A History of Failures
Judge Carter, who has been tracking LA’s homeless crisis for years, pointed to repeated failures in financial oversight dating back to 2007. Reports have consistently shown inaccurate accounting, poor data tracking, and an inability to determine where taxpayer money is going. A&M’s latest assessment confirmed the same issues, describing a “disjointed and poorly managed system” that could not fully account for funds allocated to homeless services.
Carter criticized city and county officials for their inaction, calling the lack of accountability “old news.” He noted that LA’s homeless response system is fragmented across multiple agencies, making it nearly impossible to track where funding is spent.
“There was a lot of stonewalling going on,” Carter said. “If you don’t have the documentation, just say so.”
Billions Spent, but No Clear Impact
According to the A&M audit, an estimated $2.8 million was spent on the review itself. Yet, the firm was still unable to determine the full extent of how the city’s $2.3 billion in homelessness funding had been used.
Key findings from the report included:
Lack of financial oversight: LA’s Homeless Services Authority (LAHSA), the joint city-county agency responsible for homelessness programs, struggled to track payments and contracts.
Fragmented systems: The city, county, and LAHSA use separate data tracking methods, making it difficult to verify spending or measure program effectiveness.
Inconsistent reporting: Auditors found major gaps in financial documentation, leading to “significant obstacles” in assessing how money was spent.
A&M auditors said they were unable to fully quantify the amount spent on shelter beds, services, or other key programs due to poor data tracking by the city and LAHSA.
Mayor Bass Acknowledges System is “Broken”
Mayor Karen Bass, who was not present at the start of the hearing, rushed to attend after Carter personally called her office. She admitted the system was flawed but remained optimistic about finding solutions.
“I believe we can stop people from dying on our streets,” Bass said.
Carter had requested other top officials, including City Council President Marqueece Harris-Dawson and LAHSA CEO Va Lecia Adams Kellum, to attend. Kellum, who was in Boston, did not show up, which Carter called “not acceptable.”
What Happens Next?
Judge Carter suggested that a centralized oversight system could be the key to fixing LA’s homelessness response. Instead of multiple agencies working independently, he argued for a unified strategy with strict financial accountability.
He also set a follow-up hearing for next month to continue discussions on solutions.
Meanwhile, frustration continues to build among local advocates and taxpayers. Paul Webster, executive director of the L.A. Alliance for Human Rights, said the findings confirmed what critics have suspected for years.
“We knew this was a fractured, ineffective system with financial mismanagement,” Webster said. “We just didn’t know how deep it went.”
He emphasized that the audit shows a clear need for a complete overhaul of how Los Angeles handles its homelessness crisis.
With billions of dollars spent and homelessness still at crisis levels, Angelenos are left wondering: Where is all the money going?
