What Homelessness Costs Taxpayers (And How to Change That)

A chronically homeless person costs taxpayer an average of about $35,500 per year. For a little comparison, that sum is over twice the federal minimum wage ($15,080) and a little over one and a half times Oregon’s lowest minimum wage ($23,400) in a year’s gross pay. Spending that much money on a single chronically homeless person gives many people a sour taste in their mouths, probably even yours, but there are ways to sweeten the palate by understanding where that money is spent and how to reduce the costs.

For many, there is an underlying assumption that homelessness is expensive due to government handouts and welfare programs. While these are certainly costly, two other elements are more costly. Payment for emergency healthcare for injuries, untreated wounds, and diseases that often requires emergency ambulance rides, hospital stays, and treatment that amasses well over a third of the annual costs. Hospital stays are not cheap for anyone, let alone uninsured unhoused persons. The second most costly component is policing and enforcement, making street sweeps, camp breakdowns, arrests, court fees, and jail time for criminalized homelessness rack up over a fifth of the taxpayer’s bill. There is an irony in how those efforts to control homelessness are not only ineffective but also expensive to maintain.

Shelters, temporary housing, and social services like welfare outreach and addiction assistance are at the bottom of the tab, accounting for around two fifths of the annual total costs to taxpayers. Incredibly, studies conducted by both government agencies and nonprofits have indicated the most effective methods to curtail homelessness are through housing and support services. 

People without homes and the safety they provide incur costs from public funds because they are heavily reliant on expensive systems. As the old adage goes, you can get something cheap and fast but it won’t be good, and something fast and good will never be cheap. Emergency responses, treatment, last-resort housing, and law enforcement all are the most expensive ways to exist. On the other hand, stability and dependability are the most economical.

Nobody likes throwing money at a pit, but the math isn’t deceiving you: Expensive healthcare and law enforcement accounts for anywhere between 60-75% of the costs annually, and the most effective way to reduce the tax burden of homelessness is by reducing the need for medical interventions and cutting police responses that aren’t useful.

On the other hand, focusing on the root issues and helping homeless people get back on their feet would cost the taxpayers an average of $13,000 per year. That’s far less than it costs now, and adding that it gives people a fighting chance to get out of homelessness altogether makes it sound like a sweet investment instead.

So, what can you do to turn this around?

Vote for local measures that take a housing-first approach and provide homeless people a modicum of safety they can rely on. Giving them a space to call home for longer than a few nights provides the chance to have belongings and get non-emergency services. It also lets people pursue dreams like having a job again and earning a wage.

Support programs that allow homeless people to possess objects safety, like community safekeeping lockers.

Write to your representatives about how emergency services are an industry in and of itself that drains public coffers and that there are better ways to curb the cost of homelessness. Raise awareness of the numbers and facts.

But most importantly, treat homeless people as humans worthy of dignity and safety. Lowering the expenses incurred on the taxpayer dime starts by seeing them as humans deserving of responsible investments rather than an endless epidemic to be chased around the city.

To learn more about the cost of homelessness, check these links out:
Ending Chronic Homelessness Saves Taxpayers Money and The Costs and Harms of Homelessness