Lawmakers hear requests to expand Michigan supportive housing after pilots show high retention and cost offsets

Lansing — The House Appropriations Subcommittee on Human Services heard testimony from supportive-housing providers, a regional coalition and the Michigan Department of Health and Human Services on efforts to expand permanent supportive housing and a request for a $25 million appropriation in fiscal 2026.

Catherine Distel Delrath, director with the Corporation for Supportive Housing, told the committee that “supportive housing at its core is really affordable housing paired with supportive services,” and said the model is aimed at people who are chronically homeless and have disabling conditions such as severe mental illness or substance use disorders.

Distel Delrath and regional providers cited several outcomes associated with supportive housing: high housing retention, income gains for participants and reduced use of emergency services. “We really see a lot of very positive outcomes with supportive housing as well. Housing stability, of course, is 1 of those things,” she told the committee, and referenced a prior rigorous study showing reductions in jail stays and emergency department visits and an approximate $7,000 annual cost offset per person.

Becca Binder, executive with Northwest Michigan Supportive Housing (NMSH), described operations in a five-county region (Antrim, Benzie, Kalkaska, Grand Traverse and Leelanau). She said NMSH owns six properties totaling 28 rental units but that most placements are through scattered-site leases with private landlords, supported by HUD Continuum of Care rental subsidies and case management.

Binder said the local program has produced measurable outcomes after recent state allocations. Committee testimony cited that prior state appropriations — $6 million in FY23 and a $20 million FY24 supplemental — had supported 470 supportive-housing residents with a 98% housing stability rate and that 82% of participants maintained or increased income while in the program. Distel Delrath said providers are pursuing a $25 million FY26 appropriation projected to serve about 3,125 residents statewide and that annual state funding needs may decline over time as providers leverage Medicaid reimbursements for billable services.

Ashley Halliday Schmant, director of the Northwest Michigan Coalition to End Homelessness, said the funds allowed local providers to meet evidence-based caseload ratios and to expand services alongside new local investments. “Supportive housing, when fully resourced, works. It just simply works,” she told the committee, and described local county and city allocations that have been used to expand rental assistance and case management.

Duane Haywood, senior deputy director for the Economic Stability Administration at MDHHS, provided statewide context. He said Michigan had “over 31,000 individuals who were homeless” in 2024 and that MDHHS administers roughly $60 million in federal and state grants for homelessness programs. Haywood summarized programs the department operates or funds, including emergency shelter nights, rapid rehousing, permanent supportive housing services, PATH outreach teams and targeted pilots linking housing assistance to child-welfare prevention.

Committee members asked providers about timelines and measurement. Witnesses said program-level outcomes cited for NMSH refer to fiscal year 2024 (January–December 2024) and that some pilots remain under evaluation; MDHHS said it would supply additional data on Medicaid integration and other metrics on follow-up.

The only formal action recorded during the hearing was approval of the committee’s April 15 minutes. Representative Kevin Edwards moved to approve the minutes; with no objections the clerk recorded the minutes as approved.

The testimony provided to the subcommittee emphasized that supportive housing combines rental subsidy and housing-focused case management, that providers see short-term reductions in emergency system use, and that state appropriations have been used to scale services and build local partnerships. Several witnesses urged continued and expanded state funding while providers and MDHHS continue to explore Medicaid reimbursement as a sustainable revenue source.