Budget panel approves $46 million transfer for InsightSafe motel operations, seeks county reimbursement details

The Los Angeles City Budget and Finance Committee on Feb. 18 approved a transfer of roughly $46,000,000 from the Homelessness Emergency Account (General City Purposes Fund 20) to cover InsightSafe motel services, occupancy transitions and related costs.

Committee members pressed the City Administrative Officer(CAO) for specifics on what the transfer would fund and whether the county would reimburse the city for Alliance-settlement-eligible beds. Pedro Torres of the CAOoffice described the components of the request: "First off, there's $12,000,000 for InsightSafe booking agreements..." and he outlined additional amounts including a $27,700,000 request to advance provider costs and roughly $2,700,000 for occupancy agreement conversions.

The committee's follow-up questions focused on reimbursement timelines and the distinction between booking agreements and occupancy agreements. Kendra Leal of the CAO's office said the city "would anticipate that that funding would be reimbursed" and that billing to the county is already underway; she added, however, that reimbursements for costs incurred this fiscal year would likely arrive in the next fiscal year.

Members sought detail on which motel rooms are on booking agreements versus occupancy agreements, how the city will track conversion to Alliance-eligible beds through 2027, and how damage claims tied to the inside-safe motel portfolio are being handled. Council members asked for a fiscal and operational plan detailing the inside-safe portfolio; the CAO said that plan will be included in the next Homeless Emergency Account (HEA) report expected Friday.

Committee members also pressed the CAO and mayoral staff on claims handling. The CAOoffice said the mayor's office has engaged a third-party adjuster to review damage claims and that General Services and risk management are also reviewing assessment and payment for claims. Council members requested explicit reporting to describe the claims resolution process for the $3,000,000 and $5,000,000 figures that appear in the HEA materials.

The committee voted to concur with the Housing & Homelessness Committee actions and to approve the transfer as amended. The roll call was recorded as five ayes; the item was approved as stated.

The committee asked for additional items to be included in a follow-up HEA report: a detailed fiscal and operational plan for inside-safe beds, a chart distinguishing booking agreements versus occupancy agreements versus Alliance-qualifying occupancy agreements (including counts of rooms and people served), a status update on negotiations with Los Angeles County regarding retroactive counting of inside-safe beds toward the Alliance settlement through 2027, and clarification of how service-provider payments are routed (LAHSA, LADH or other).