In the summer of 2022, a group of Los Angeles based charitable foundations and partners within L.A. County government began a planning effort to mitigate the extreme housing precarity experienced by youth in and exiting foster care, with the hope of ending homelessness for this segment of the population.
A key motivation of the convening partners was to identify ways in which foundations could explore investing their endowment dollars – going beyond their traditional role of grantmaking – as capital investments into youth housing projects. By expanding the role of these foundations, the group hoped to attract new financial resources to the development of affordable housing for youth while still earning a competitive return on their investments so that they can continue their grantmaking from endowment earnings. To begin evaluating the feasibility of investing their endowment dollars in such a way, the foundations commissioned Genesis LA, a local Community Development Financial Institution (CDFI), to prepare a financial model that evaluates possible housing arrangements and financial structures for foundation investments. This report presents the findings from this research and financial modeling. There is no official tally of foster youth who experience homelessness, however, this report attempts to quantify this population as a baseline for projecting housing needs and the scope of potential philanthropic investments (Section 4). Approximately 1,140 youth between age 18-21 exit foster care each year in L.A. County. Various surveys have identified that between 20% and 40% of these youth experience homelessness and/or housing insecurity in the immediate years after exiting foster care. Existing public programs to serve this population generally provide housing subsidies and social services for up to three years. Based on available data, we estimate that approximately 2,000 youth are already being served by these subsidy sources, however, this has proven to be insufficient to meet the need. Thus, this report establishes a baseline need to expand capacity for approximately 1,368 youth in an effort to end homelessness among foster youth in LA County.
This report recognizes that the current ecosystem of social services and safety net programs that provide housing subsidies and vouchers for youth is essential to underwriting investments in the development of new housing projects for youth. However, this report also recognizes that these services and programs are insufficient to meet the current needs and they must be augmented. Thus, we attempt to outline the existing funding ecosystem and identify potential areas for expanding rental subsidies to support growth in the stock of youth housing (Section 5).