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CAO outlines $29M+ in HAP recaptures and time‑sensitive reprogramming to meet June 30, 2026 deadline

Los Angeles City Housing and Homelessness Committee · February 12, 2026

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Summary

The CAO told the committee it identified recaptured savings across HAP rounds (about $7.4M in HAP2, $29M in HAP3 and $9.3M in HAP4) and recommended reprogramming some funds for interim housing repairs, Project Homekey sites and a 94‑unit permanent supportive housing project; committee deferred full action to a special meeting while seeking more detail from CAO and CLA.

The City Administrative Officer presented the third homelessness funding report for FY25‑26 on Feb. 11, outlining recaptures and reprogramming recommendations tied to state expenditure deadlines.

Michael Zambrano (CAO) said the report recommended bed‑count adjustments at three interim housing sites that freed small amounts ($107,310 and $259,880) to reallocate to Project Homekey and other interim sites. The CAO also reported identified underspends and recaptures totaling approximately $7.4 million in HAP2, $29 million in HAP3, and $9.3 million in HAP4 that could be repurposed after reconciliation.

The presentation requested transfers from the homelessness emergency account to support Inside Safe service providers and LAHSA administrative costs and proposed funding for the Mayfair interim housing site, Project Homekey 3 and three state tiny‑home sites through the fiscal year, including start‑up costs and General Services Department authority to contract with service providers. The CAO recommended up to $4.2 million in HAP3 funding to support a 94‑unit permanent supportive housing development in Council District 14 and requested approximately $3.8 million to continue LAHSA homeless engagement teams and system navigators for the year.

Councilmembers pressed CAO for clarity on the amounts being appropriated versus recaptured, why the report was released the day before the meeting, and how quickly reprogramming recommendations could be returned. CAO staff said much of the recaptured funding is placed into funding category “holding” accounts before being programmed and committed to specific projects and promised to return with detailed reprogramming recommendations within a month.

Because several urgent repair needs (including fire damage at a tiny‑home site and deferred maintenance at a Bridge Home in Council District 3) were identified, a councilmember moved to advance interim‑housing repair recommendations (several numbered recommendations were cited) while holding other recommendations on the desk. The committee did not finalize partial approvals pending procedural review; the Chair said staff will schedule a special meeting soon so CAO, CLA and Budget and Finance can answer outstanding questions without jeopardizing state expenditure deadlines.

The committee emphasized the need for earlier access to large funding reports, more collaboration with CLA before release and a clear spending plan and monitoring reports to track reprogrammed funds.