City agrees to pay another $3.5 million for operator of Spokane’s largest homeless shelter

Operations at the city-run Trent Avenue homeless shelter will cost $3.5 million more to keep it open through 2023.

The Salvation Army will be paid as much as $9.1 million to operate the city’s largest homeless shelter, which has regularly served more than 300 people since last winter, through the end of the year. The Spokane City Council unanimously approved a contract amendment Monday night providing up to that amount to be spent for the Salvation Army’s operating costs.

That nonprofit has overseen the facility and an expansion of services since November, following the abrupt late October termination of a contract with the Guardians Foundation.

The city ended its contract with the Guardians Foundation, originally expected to operate the Trent Shelter until the end of this year for $6.5 million, due to concerns that an employee of the nonprofit may have embezzled as much as $1 million.

Not long after the Trent Resource and Assistance Center’s operator changed, so too did the services the facility provided.

“The scope of the work at that location and the operations have significantly changed,” said Jenn Cerecedes, director of Spokane’s Community, Housing and Human Services Department. “The biggest, most obvious change is the number of folks being served.”

Initially, the facility that provides nightly emergency shelter and some services to help transition people out of homelessness was expected to regularly serve up to 150 people, with some capacity to shelter more in limited circumstances. Less than two months after the Salvation Army took over, the former warehouse had 350 beds and was often at or near capacity as the weather cooled.

The single largest source of funding for the Salvation Army contract expansion, more than $1.7 million, came from the state through Right of Way funding, funds administered by the Department of Commerce and intended to clear encampments on state-owned property such as Camp Hope. Because the Trent shelter was identified by the city as a primary shelter to relocate those previously living in the now-closed encampment, state funds continue to flow to that project.

Another $1.5 million came from city real estate excise taxes, a tax on the sale of property typically used to cover one-time costs to improve infrastructure or property. The City Council in May also approved using $1 million from the excise tax fund to build bathrooms at the facility. Some on council have said they have heartburn over the use of excise taxes on the Trent shelter, especially for ongoing operational costs.

“Using REET money makes me nervous,” then-Councilwoman Lori Kinnear said shortly before the May vote. “It takes a long time to build that up, and a million dollars is a lot of money.”

The remaining funds to pay for the boost, around $260,000, come from American Rescue Plan COVID-19 relief.

While most on the council have raised grave concerns about the financial sustainability of a facility expected to cost roughly $14 million, relying largely on one-time infusions of federal, state and local funds to keep its doors open, some have also questioned the increased costs since Salvation Army took over operations.

“The Salvation Army said they’d take on the old contract, and they got in and started to charge more,” Councilman Zack Zappone said in an interview. “Last winter, all of a sudden we’re operating at 350 beds every day under the premise of, ‘We can’t turn anybody away.’ ”

Due to how quickly a new operator was needed to take over for the Guardians Foundation, there was not a formal, competitive request for proposals, Zappone said. The city is reviewing proposals from providers who may continue the contract through the end of the year.

In an earlier version of the contract amendment, the Salvation Army’s current contract would have ended Oct. 31, two months ahead of schedule. This had been proposed by former City Council President Breean Beggs, who left the council in July to become a Spokane Superior Court judge, Kinnear said.

But Kinnear pulled back from this proposal, saying it made the best sense to keep the Salvation Army in its current contract through its expiration, by which point the city could spend time considering what organization should operate the facility in 2024.

City spokesman Brian Coddington argued the expectations for shelter capacity changed not long after the facility opened, as both providers and the city became more aware of the needs that the Trent shelter addressed. Demand for shelters also tends to decrease after the winter months, he added, but has remained consistently high at the Trent shelter well into summer, with the city reporting 341 people staying at the facility on Wednesday.

Coddington suggested the unseasonable demand seemed likely due to two factors. First, there isn’t sufficient housing for people to transition to after initially staying at the Trent shelter, meaning many have stayed longer than was intended for what is supposed to be a short-term shelter.

“The other working theory is that people have found it to be a place with community, as they’ve come in and found a bed and found regular meals and connectivity to services,” he added. “That’s a good thing.”

Despite this unexpected increase in demand, Coddington added that, while the Salvation Army now has a contract for up to $9.1 million, it is currently on track to spend closer to $8 million by the end of the year.

Though she’s wary about how the city will pay for the facility long term, Kinnear conceded that cost increases were to be expected.

“It takes a while for people to get up to speed on what is needed,” she said. “When you cram 350 into a warehouse, it’s challenging. I think they’ve done the best they could have under the circumstances.”

Still, some on the council remain frustrated with what they see as a lack of predictability with the costs of the Trent shelter.

“The crux of my frustration is the uncertainty of costs,” Zappone said. “There has never been a sustainable long-term plan for TRAC, and we’re presented with this as our only option, this or winter comes and people are out on the street.”