Minneapolis' model anti-homelessness program faces "fiscal cliff"
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One of Minneapolis' most successful homelessness prevention programs is not accepting new referrals, and could run out of money by next spring unless the mayor and City Council can agree how to financially rescue it.
Why it matters: The "Stable Homes Stable Schools" program — which helps house 240 Minneapolis Public Schools families at risk of homelessness — has been championed as a success story by practically everyone in a divided City Hall.
- The program stars in Mayor Jacob Frey's first campaign ad. It's also racing toward a "fiscal cliff," city officials warn.
What happened: In 2023, officials decided to use reserves to help fund Stable Homes Stable Schools while they searched for additional public or philanthropic funding sources.
- "The expectation was we'd have more time, and we'd figure it out," Erik Hansen, the city's planning and economic development director, told Axios.
- But it's been a victim of its own success. As more families enrolled, the program's reserve drained faster than anticipated. Officials paused referrals in July after they realized funds might not last the 2025-26 school year.
Friction point: In August, to remedy Stable Homes Stable Schools' $3.2 million projected shortfall, Frey proposed canceling another promising anti-homelessness initiative to provide 100 emergency housing vouchers for chronically unsheltered individuals and families.
- Many City Council members believe this is needed just as urgently, and the council earmarked the funding last year to revive the pandemic-era program "that had incredibly successful outcomes at long-term housing stability," Ward 2 representative Robin Wonsley wrote in a newsletter.
Yes, but: No vouchers have been issued yet, so Frey administration officials decided it would be irresponsible to begin a new anti-homelessness initiative — promising though it may be — with an existing program short on funds.
Reality check: In a city with a $2 billion budget, this entire fight is over a small sum of funds: Stable Homes Stable Schools will cost around $4 million this year.
- Even under the mayor's rescue plan, the program would still only serve around 10% of MPS' housing-insecure families, and only in the elementary grades.
What they're saying: "We're here to make a commitment to these families," Frey told reporters earlier this month, urging the council to also come through with long-term funding.
The other side: "There is no world in which we should have to decide between two critically important emergency housing options," Hoang Murphy, CEO of the People Serving People network of homeless shelters, told Axios.
- "I'm glad that we're not kicking people off the [Stable Homes Stable Schools] rolls, but it's still not enough to meet the need," Murphy said, faulting both the mayor and council for failing to foresee the crisis.
What we're watching: How council members receive Frey's proposal as budget talks ramp up amid an election year.
- "Our city needs both programs to be fully funded," Council Member Wonsley wrote.
The bottom line: The whole saga has mired a success story in a depressing set of trade-offs facing local leaders tackling a homelessness crisis.