HomeRise, which is one of San Francisco's largest providers of services to the homeless or recently homeless, is calling it quits two years after the city auditor found evidence of wild fiscal mismanagement, and months after an employee was accused of sexually abusing clients.
It's been open season on SF's so-called "nonprofit industrial complex" the last couple of years, with the web of largely city-funded nonprofit serving the homeless sometimes referred to as the "homeless industrial complex." And we now have another case of rumors of misspent funds and mismanagement giving way to a scathing audit that, now, has resulted in the full collapse of an organization.
The scathing audit of HomeRise dates back to early April 2024, while Mayor London Breed was still in office, with the city auditor finding ample evidence of "gross fiscal noncompliance, wasteful practices that misuse taxpayer funds, and spending of city funds on unallowed or questionable costs that likely diverted services from intended housing recipients or facility improvements."
The audit covered a four-year period from 2019 to 2023, and it found city funds being used improperly for social events, unbudgeted staff bonuses, lunches, and gifts, in addition to many instances of expenses being improperly charged to various property accounts.
HomeRise has been responsible for overseeing the operations and supportive services at 17 properties serving the homeless and formerly homeless, and as the Chronicle reports today, the organization's shutdown will mean the city having to find new operators for all of them — though the wind-down of the organization appears like it will take one to two years.
"The city, together with HomeRise, have come to the conclusion that the organization’s current operating model is not sustainable," said a spokesperson for the city's Department of Homelessness and Supportive Housing, in a statement.
Former HomeRise CEO Janéa Jackson stepped down after three years on the job in May, amid growing scrutiny over the organization's finances. And her departure came two months after it came to light, via a Chronicle report, that missed wellness checks at one HomeRise property, Jazzie Collins Apartments, led to the death of one resident — who was found days later, decomposing in his room. The incident led the city to place HomeRise on its most stringent level of nonprofit monitoring, and its city contracts were in the balance. Four of the organization's nine city contracts were then allowed to lapse in July.
In July, we also learned that a HomeRise case manager was accused of sexual misconduct with both employees and clients, and that the nonprofit was accused of ignoring complaints about this case manager for two years.
The HomeRise board says it will be conducting a nationwide search for a CEO to oversee the dissolution of the organization.
The city audit found that HomeRise had received nearly a quarter-billion dollars in city funds over a four-year period, and the nonprofit's assets include many of the buildings that it manages — which alone will be worth hundreds of millions of dollars.
Mayor Daniel Lurie has promised to take an "outcomes-based" approach to renewing nonprofit contracts in the future. The last few years have seen the shutdown of another prominent homeless nonprofit, the United Council of Human Services, after its city contracts were canceled. And more recently, last summer, Collective Impact, which had ties to indicted former director Sheryl Davis, announced it was ceasing operations.
Related: Former SF Supportive Housing Case Manager Accused of Sexually Abusing Employees, Residents
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