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North Bay Business Journal

Monday, December 31, 2012, 5:30 am

The business impact of increased homelessness

As COTS faces funding threat, people, community will suffer

By John Records

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    Newcomers to the Petaluma area are often surprised to learn that the graceful yellow building at the corner of Caulfield and Hopper streets is a homeless shelter — the Mary Isaak Center, operated by the Committee on the Shelterless (COTS). What may also surprise people is what could happen to local businesses if COTS was not in our backyard, a potential reality in light of significant government funding cuts.

     A new study by leading regional economist Dr. Rob Eyler of Economic Forensics and Analytics looked at the connection between homelessness and the local economy and estimates that a reduction in COTS programs and services could impact businesses in the greater Petaluma area to the tune of $20.6 million annually. It could also negatively impact more than 125 jobs. The research considered the effects if Petaluma businesses alone lost just 1 percent of revenue as a result of an increased presence of homeless people in business areas which can affect the flow of customer traffic and make a location less desirable for new and existing business.

     Prior to this analysis, very little has been researched about how the presence of homeless people in a business district may reduce the capabilities of local merchants to operate and profit.  It’s the ripple effect of cutbacks that is often overlooked, and for nonprofit organizations such as COTS, our ability to provide services to homeless people reduces the social and economic costs of homelessness on businesses, local government, and the homeless people themselves. 

     The greater Petaluma community has come to rely on COTS for the past 24 years to provide comprehensive programs and services for homeless adults and families to get people off the street and back on their feet. Today, COTS offers 354 beds per night to homeless adults and families. The COTS Petaluma Kitchen serves more than 125,000 meals a year and delivers 760,000 pounds of food annually.

    New data and research confirm that COTS remains on the cutting edge of transforming lives: helping our clients find permanent housing at twice the rate of shelters nationwide (nearly 80 percent of people leaving our transitional housing program find housing); systematizing our services for greater efficiency; and greatly reducing costs to government, healthcare systems and local businesses.

    COTS  is recognized nationally as a leader in this work because we run our organization as a business. With an executive team that has deep professional experience at Fortune 500 companies and corporate law firms, COTS is also supported by a Board of prominent local leaders. Not only is it our mission to prevent and treat homelessness, it is also our goal to support our community by helping to create an environment in which businesses thrive. 

    Six years ago, we began working with the findings of a Kaiser Foundation study on Adverse Childhood Experiences (ACES). Unlike the homeless agencies that only provide meals and beds, our highly trained staff has a unique understanding of the impact of early adversity on the lives of homeless adults and helps break the risk cycle to allow people to recover and transform their lives. Not surprisingly, this is also a very cost effective approach for treating homelessness.

    Our “trauma-informed” practices were recently published in the “Journal of Prevention and Intervention in the Community” (September 2012) and presented as models for helping homeless people maintain sobriety, increase income and regain independence. Achieving national recognition for our work is important on many levels, and it is further validation of the return-on-investment we can provide to the community and our supporters.

    As COTS faces unprecedented shortfalls in government financing, we have embarked on an ambitious private financing campaign reaching out to businesses and individuals alike to keep the doors of the Mary Isaak Center open and thriving for the foreseeable future. The sad irony is that we’ve honed our understanding of how to do our job — a job that is even more important given how much people are suffering in this economy — at exactly the moment when funding is in shorter supply.

     The bright spot in all of this is that we serve a kind and generous community which we believe recognizes the value of COTS and will ensure we are able to transform the lives of homeless children and adults for a long time to come. 

    John Records is Executive Director of COTS in Petaluma john@cots-homeless.org .

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