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23 c. As new housing comes online, transition non-congregate shelters to permanent housing or remove from system 5. Provide accessible behavioral health services to people with serious mental illness or substance use needs and who are unsheltered, in shelter, or in supportive housing programs. Corresponding System Performance Measures Progress on this goal area will be tracked using the above measures related to new and returning homelessness, and these two measures of reductions in unsheltered homelessness. 3a. Reduce the number who are unsheltered at a point in time 3b. Reduce the racial disparities among people overrepresented among those who are unsheltered. 4a. Increase successful placements from street outreach to indoor locations 4b. Monitor for racial disparities placements from street outreach and address any disparities 3) Increase Housing Solutions The system modeling and interviews with people experiencing homelessness indicate that the single most important step to reduce homelessness dramatically and permanently is to create permanent housing opportunities for people experiencing homelessness throughout the county. Our System Modeling shows that the homelessness response system is starting (in 2021) with an inventory of 3,215 permanent housing units, and that by year 5 (2026), our system will need a total of 25,695permanent housing units and subsidies. (See Table 7 above “5 Year Inventory Needs”) Some permanent housing units will become available each year through unit turnover (at an estimated rate of 8%), and the rest of the need will be for new housing inventory. The total cost of operating permanent housing from year 1 (2022) through year 5 (2026) is estimated to be $1.68 billion. This cost is for operations only and does not reflect additional development costs. New projects to increase inventory include expansions in exiting models like rapid rehousing and permanent supportive housing as well as significant investment in newer models such as dedicated affordable housing and shallow subsidies that allow people to have housing that allows them independence and autonomy, a strategy recommended to be more effective in reducing racial disparities. Today’s pipeline of projects show that new projects will increase the inventory by 1,500 in the first two years, but resources must be identified for thousands more units. New one-time resources are anticipated from both the Federal and State governments which will assist with this goal, but ongoing local resources will be needed to meet the ambitious targets that necessary to bend the curve. 1. Add units and subsidies for permanent supportive housing. 2. Create units for frail seniors and others with more intensive health services. a. Provide services funding for PSH and PSH plus through expansions of Medi-Cal and CAL-AIM. 3. Create dedicated affordable housing subsidies for people who do not need intensive services.