According to The 2015 Annual Homeless Assessment Report to Congress, veterans make up about 9.2 percent of the total U.S. population, and, they comprise about 10 percent of all homeless people. Ninety-one percent of homeless veterans are men, and according to a literature review conducted for the Department of Labor, three major health risks contributed to veteran homelessness: mental health problems, substance abuse, and chronic illnesses. VA and HUD both play a role in assisting homeless veterans. VA provides a broad range of benefits, including health care and housing, to homeless veterans and certain members of a veteran’s family. HUD is the primary federal agency that provides funding for emergency shelters, permanent housing, and transitional housing to assist the homeless and those at risk of homelessness, including veterans. VA views the authority to enter into EULs as an important component of both VA’s mission to end veterans’ homelessness and manage its real property assets. VA’s Fiscal Year 2017 “EUL Consideration Report,” provided in its budget submission to Congress, describes its management of unutilized and underutilized real property using its EUL authority and how EULs align with VA’s initiative to eliminate veteran homelessness. VA is one of the largest non-defense federal property-holding agencies; VA officials stated that in fiscal year 2016, VA held about 155-million square feet and leased 25-million square feet of building assets, about 11.5-million square feet (or 6.4 percent) of which were unutilized or underutilized. Previously, VA was authorized to lease its unutilized or underutilized real property to public or private entities for any use that contributed to VA’s mission. This EUL authority expired on December 31, 2011. According to VA officials, from the EUL program’s inception through December 2011, VA entered into 100 EULs, 9 of which VA subsequently terminated or disposed of the property. In 2012, VA received authority to enter into EULs, but only for supportive-housing, through December 2023. Supportive-housing provides on-site and community-based support services for the veterans or their families who are homeless or at risk of homelessness. Additionally, VA received authority to accept cash payments or to enter into an EUL without receiving payment. VA can execute EULs for terms of up to 75 years. VA’s Office of Asset Enterprise Management (OAEM) administers the EULs, with support from the VA’s local facility staff. In addition, the lessee (such as a non-profit organization, public-housing authority, or a development corporation) play an important role in financing, developing, constructing, rehabilitating, operating, and maintaining the supportive- housing EUL for homeless veterans. The EUL process consists of four phases: development, execution, operational, and if applicable, disposal (see fig. 1). VA officials estimated that it takes 2 to 2.5 years from the time VA identifies unneeded property to the time doors open at a supportive-housing EUL. HUD-VASH, GPD, and SSVF provide different types of housing assistance to fulfill different levels and areas of need. These programs provide supportive services and housing subsidies to eligible veterans, including those who live at EUL housing sites. HUD-VASH provides permanent supportive-housing assistance for homeless veterans, prioritizing chronically homeless and highly vulnerable veterans who have a high level of housing and service needs, such as those with high barriers to employment and self-sufficiency. In contrast, GPD provides transitional housing and SSVF focuses on short-term, crisis intervention when providing homeless prevention and rapid rehousing; both of these programs also provide supportive services for veterans who do not have as high a level of needs as those in the HUD-VASH program. See app. III for participant program eligibility. HUD and VA established the HUD-VASH program in 1992. HUD, through public-housing authorities, allocates subsidized housing vouchers to eligible homeless veterans and their families while VA provides case management and other services. Through the program, the public-housing authority pays the subsidy to the landlord directly and the veteran family pays the remainder of the rent. A majority of the HUD-VASH vouchers are tenant-based, meaning that the vouchers move with the veterans. With the partnering VAMC’s support, HUD allows public-housing authorities to make their HUD- VASH vouchers project-based (i.e., tied to a specific housing unit and not to a tenant). Separately, in fiscal years 2010, 2014, 2015, and 2016, HUD awarded project-based vouchers to specific projects through competition. Between fiscal year 2008 and 2016, HUD allocated about 82,500 tenant-based vouchers to public-housing authorities and about 4,800 project-based vouchers through competition to specific projects. Overall, Congress appropriated approximately $75 million each year from 2008–2010 and 2012–2015, $50 million in 2011, and $60 million in 2016 for the HUD-VASH program. Congress originally authorized the GPD program in 1992 and reauthorized the program in December 2001. The program was permanently authorized in 2006. The GPD program generally provides transitional housing paired with intensive services and support to address a veteran’s barriers to achieving permanent housing. The program provides beds to homeless veterans in a supervised drug- and alcohol-free setting. Through GPD, VA awards grants to community agencies, including non-profit organizations and state and local government agencies. The grants fund up to 65 percent of the cost for acquiring, renovating, or constructing supportive-housing facilities or service centers and purchasing vans for outreach and transportation. GPD also provides funding for programs that provide services to homeless veterans. These services include case management, mental health treatment, and substance abuse treatment to help homeless veterans increase their residential stability, skill levels or income, and independence. VA designates GPD liaisons to oversee the program, provide case management, and determine veterans’ program eligibility. Congress generally increased its appropriation for the GPD program over the years, to about $220 million in fiscal year 2015. Congress authorized SSVF in 2008, but the program first became operational in fiscal year 2012. SSVF provides rapid rehousing to prevent or address “literal” homelessness for very low income veterans and families. Through SSVF, VA awards grants to service providers, which are required to provide outreach, case management, VA benefit assistance, and provide or coordinate efforts to obtain other eligible benefits and community services for the veterans. Additionally, service providers provide temporary financial assistance such as rent, utility payments, childcare, and transportation. Funding for SSVF has expanded from the initial appropriation of $60 million in fiscal year 2011 to about $300 million annually since fiscal year 2013. As of September 2016, VA had developed 35 active supportive-housing EULs for veterans who were homeless or at risk of homelessness with low cost rental housing and coordinated access to medical, rehabilitative, and mental healthcare, as well as other services on VA campuses. The 35 EULs are located in 18 states. Most of them provide permanent or transitional housing while 5 EULs focus on senior and assisted living (see fig. 2). According to VA reports, supportive-housing EULs were developed for homeless and at-risk veterans; however, the population served was expanded to include senior veterans capable of independent living and veterans requiring assisted-living with supportive services. As of September 2016, almost half (17 of 35) of the active supportive- housing EULs had operated for more than 5 years. Based on our analysis of VA data, these EULs include both “legacy” projects—those that VA completed prior to the BURR initiative—and those from the BURR initiative (see table 3 for more details on these projects). In 1999, VA and the Housing Authority of the City of Vancouver established one of the first supportive-housing EULs, consisting of 124 units. Additional supportive-housing EULs resulted in 2,391 total housing units as of September 2016. About 74 percent of these units provide permanent housing, which includes seniors’ supportive-housing and assisted-living facilities (see table 1). According to VA officials, its four newest facilities opened in 2016 in Bedford and Northampton, Massachusetts, and Vancouver and Walla Walla, Washington. See appendix IV for a complete list of all 70 supportive-housing EULs and their status—active, under construction, in development, pre-development, on hold, and terminated—from 1998 through 2016. VA’s supportive-housing EULs serve a smaller but growing number of homeless veterans in relation to the other three key homeless programs in our review. Although the EUL program is smaller than the other key programs, VA officials stated that supportive-housing EULs play an important role in meeting the needs of homeless veterans with a mix of permanent and transitional housing on VA medical campuses. Furthermore, VA’s Fiscal Year 2016 “EUL Consideration Report,” noted that the amount of housing available to veterans has increased as VA has identified properties for development of additional supportive-housing EULs. As of fiscal year 2009, VA estimated that the supportive-housing EUL program provided housing for an average of 536 veterans a year. By fiscal year 2015 (the most recent year for which VA data are available), supportive-housing EULs provided 1,675 veterans with housing. In addition to offering housing, EULs provide access to medical and rehabilitative care, mental health counselling, substance abuse treatment, and an array of other services on VA medical campuses aimed at improving veterans’ health and well-being. According to USICH, supportive-housing is widely recognized as the solution for vulnerable people experiencing chronic homelessness who often have the greatest challenge in finding and remaining in permanent housing. Figure 3 provides examples of services that may be available at supportive- housing EULs to support veterans’ health and wellness. Below are examples of the services available at some of the permanent, transitional, and senior living supportive-housing EUL sites we visited. For profiles on each of the 13 sites we visited, including information about the supportive services offered and the housing assistance programs, see appendix V. Lyons, New Jersey (permanent housing): According to lessee officials, the majority of the units receive project-based HUD-VASH vouchers, which provide housing subsidies and case management services. Other supportive services include in-home counseling and on-site and 24/7 on-call crisis prevention and intervention, assistance with applying for benefits, financial budgeting, legal assistance, and vocational training. Los Angeles, California (permanent housing): Two supportive-housing EUL facilities are located on the VA Sepulveda Ambulatory Care Center campus and specifically serve disabled veterans. These supportive-housing EULs receive project-based HUD-VASH vouchers, which provide housing subsidies, on-site case management, and service coordination. Other supportive services include job training and placement, counseling, and legal services. Fort Snelling, Minneapolis, Minnesota (permanent housing): Three full-time, on-site service coordinators focus on assisting veterans with independent living, education, employment, and VA services. According to lessee officials, supportive-housing services provide trauma-informed care, crisis management, academic and social support, and job training. These supportive-housing EULs receive project based HUD-VASH vouchers, which provide housing subsidies, case management, and service coordination. St. Cloud, Minnesota (permanent housing): Located on the St. Cloud VAMC, the studio units are available to veterans who are in transition from a chemical-dependency treatment facility and in need of supportive services and housing. Facility amenities include media rooms, a communal kitchen, and a community room. Hines, Illinois (transitional housing): The supportive-housing EUL provides transitional housing and supportive services through the GPD program. These services focus on chemical dependency recovery for residents, and include structured days, balanced meals in a communal dining area, rehabilitative work training, individual counseling, recovery groups, holistic education, and assistance with permanent housing placement. Dayton, Ohio (senior housing): The senior-living supportive-housing serves low income veterans age 62 and over, including supportive services designed to help veteran residents achieve self-sufficiency. The supportive-housing EUL receives housing vouchers from HUD programs for the elderly and low income families. In addition to the supportive services provided for residents at supportive- housing EULs, VA and the lessee provide basic-administrative and operational services, such as transportation, mail delivery, and law enforcement. In some cases, the lessees face challenges getting these services up and running as the provision of these services involves multiple parties, for example: Transportation: VA officials identified the need to provide transportation services as a challenge in cases where public transportation is not easily accessible to the supportive-housing EUL location. We found that several supportive-housing EUL sites we visited provided veterans with some type of transportation. For example, one lessee provided veterans transportation to another VA campus for psychiatric, substance abuse, and other specialized care. Other lessee officials said that VA provided a campus shuttle to medical appointments on campus or provided funds for public transportation. A USICH report noted that transportation is critical in helping connect residents in supportive-housing to jobs, schools, health care, and childcare. We previously reported on VA programs to transport homeless veterans to VA or other private medical care in partnership with community-based providers. For example, the Veterans Health Administration developed the Veterans Transportation Service to help veterans obtain care by improving coordination with other transportation service providers in the community. Similarly, lessees told us they work with other community organizations to find transportation options for residents. Mail Delivery: In some cases, supportive-housing EULs faced the challenge of ensuring that the U.S. Postal Service delivers personal mail to residents, rather than to a central location on the VA campus. For example, at the supportive EUL in Sepulveda, California, it took 3 years to work out an arrangement with the Postal Service to deliver personal mail directly to the residents at the housing facility. EUL residents experienced delays in receiving mail when the Postal Service delivered it along with all of the mail for the entire VA medical campus. The mail for EUL residents was sorted from that delivered to the VA medical campus, delivered to the EUL, and then sorted again for each individual resident. This was problematic for the residents who needed personal mail on a timely basis for income and benefits, such as Social Security disability checks. Law Enforcement: VA officials noted that they have helped resolve issues of jurisdictional law enforcement authority between local law enforcement and VAMC campus police. This issue is a concern at some supportive- housing EULs because the EUL is a private residential facility located on a federal medical campus. Local law enforcement has jurisdiction over the private housing facility, and VA has jurisdiction for the part of the campus it operates. However, at times, it is unclear to local law enforcement agencies which organization is the first responder for the EUL facility. According to VA attorneys, a memorandum of understanding with local authorities to clarify first responder roles has helped some supportive-housing EULs to address the challenges of concurrent jurisdiction. In addition to the benefits to homeless veterans, our analysis of VA- reported data for EULs in operation from fiscal years 2006 through 2015 generated almost $275 million in benefits to veterans, VA, and the community. These benefits came in the form of lease revenue, cost avoidance, cost savings, and enhanced services, net of any new VA expenses (see table 2). VA’s Fiscal Year 2017 “EUL Consideration Report,” said that supportive-housing EULs resulted in cost savings by repurposing underutilized capital assets or transferring the cost to construct or renovate, operate, and maintain these properties to third- party partners (the lessees of the supportive-housing EULs). Further, allowing homeless veterans to stay in a VA medical center bed is more costly than providing them with supportive-housing. VA also reported qualitative benefits, including strengthening the network of local services available to veterans and developing community partnerships. According to VA officials, supportive-housing EULs benefit most of the lessees and developers by providing them with long-term access to federal property and land at little or no cost, access that can be particularly beneficial for those located in high-rent markets. According to the VA’s Fiscal Year 2017 “EUL Consideration Report,” 18 of 29 EULs did not pay any lease payment in fiscal year 2015. A few lessee officials we interviewed said access to federal property and land at little or no cost helped them to rehabilitate or construct facilities, in addition to providing needed services to homeless veterans. In addition, lessees we interviewed said the close proximity to VA medical, rehabilitative, and mental health services allowed them to invest in other needed services for homeless veterans, such as employment training and quality-of-life amenities. According to VA and USICH, supportive-housing EULs can also have benefits for the local community. Communities that added relatively more permanent supportive-housing units over a 6-year time frame showed significant decreases in chronic homelessness over time. Evaluations of permanent supportive-housing have demonstrated significant improvements in housing stability, reductions in days of homelessness, and reductions in the utilization and costs of public services such as emergency shelter, hospital emergency room and inpatient care, sobering centers, and jails. Supportive-housing EULs also can increase the tax base for the local community, because, according to VA officials, the facility is subject to state and local taxes, which can provide new long- term revenue sources for the local economy, jobs, and tax revenues for local and state entities. Furthermore, we identified several studies that attempted to quantify benefits to local communities. For example, a 2014 study on supportive-housing projects found that these projects create fiscal benefits for the state and local governments as a result of sales taxes collected on construction materials, income taxes paid by construction and other workers, and corporation or income taxes on profits earned by builders, developers, and other firms. Another study found that in some cases, cities and states also receive revenues from fees on affordable housing developments from permitting, zoning, and utilities. With the development of 35 active supportive-housing EULs, 6 supportive-housing EULs under construction, and 16 in development (see table 3), VA officials told us that they believe they have identified all currently viable opportunities on VA campuses. They said, however, that they continue to look for new sites on which to develop supportive- housing as changes occur in the use of VA’s properties. Challenges that VA faces in developing additional supportive-housing EULs include a lack of clear and complete documentation of project selection and implementation to inform future decisions, identifying available and suitable property for housing for homeless veterans, stakeholder opposition, and limited financing options for EULs. In addition, VA has not revised its EUL policy to address issues specific to developing supportive- housing EULs for veterans. These include the type of housing needed to serve homeless veterans in the local area, or the space configuration or square footage needed for supportive-housing as compared with available VA facilities. Without such consideration, VA may be missing an opportunity to help address these challenges. In 2009, VA launched the Building Utilization Review and Repurposing (BURR) initiative, which included a 2-year strategic study, to identify as many VA unutilized and underutilized properties as possible with the potential for development as new housing for homeless or at-risk veterans and their families. VA’s EUL authority was set to expire at the end of December 2011, and they intended to identify as many properties as possible before that deadline to support the goal of housing homeless veterans. According to officials, VA initially identified over 350 potential sites for development. By December 2011, had signed lease agreements for 38 sites. VA executed these short term-leases without completing the entire process for development of a supportive-housing EUL (see fig. 1 for a description of the process) in order to meet the deadline. These lease agreements allow the lessee 5 years for the supportive-housing EUL facility to become operational. VA officials did not comprehensively document their decision-making process for selecting the final 38 sites for development as supportive-housing EULs under the BURR initiative with a final written report or analysis. However, during the selection process, the Secretary of the VA signed formal decision briefings and documents for the individual properties. The Department entered into these 38 EUL agreements with lessees to develop 4,100 BURR housing units. As of September 2016, 871 of the 4,100 planned BURR units (21 percent) were active. In order for VA to achieve its goal by the end of December 2016, it would need to open an additional 3,229 units. The 35 active supportive- housing EULs are comprised of 15 BURR and 20 “legacy” projects (see table 3 for details on the status of these EULs). VA’s EUL policy states that to enter the development phase, EUL projects must be identified as valid priorities and included on the Department’s EUL project list. The policy describes several steps in the development phase, such as: (1) a preliminary inspection of the property; (2) identification of physical limitations such as local, state, or federal limitations on the site (e.g., zoning, environmental, or historic preservation); and (3) a preliminary asset valuation. It also requires collecting documentation about the site, such as title files, flood plain maps, and local zoning and code requirements. The policy further states that milestones, approvals, and supporting documents that occur during each phase of the process must be reported and attached in VA databases and that the office responsible for the project will ensure that all “reportables” are appropriately and accurately recorded. Furthermore, VA policy states that the Office of Asset Enterprise Management is responsible for establishing policies, procedures, guidelines, and assuring proper documentation for the EUL program. In the case of these 38 sites, under the expedited leasing process, VA completed some, but not all, of the steps in the development phase before entering into short-term leases. VA officials said they outlined the required transaction details needed to be completed before finalizing the EUL agreement, such as a development plan, financing, and environmental, and historic compliance. For example, VA analyzed the physical potential for housing, need for housing, and potential financing availability for the projects. However, VA officials did not consistently assess the same conditions for each site. In some cases, they documented known historic preservation or environmental issues but not in others. VA officials intended the short-term five-year leases to allow for the additional steps in the development process, but they did not clarify in their BURR documents the steps they had completed before signing the leases and those they planned to complete later. This lack of clarity made it difficult to assess how VA officials complied with their own policy. VA could not provide us with a final summary report or analysis documenting the BURR initiative. For the final site selection, VA officials provided us with documents of EUL sites with differing information. Initially, VA provided us with a document entitled “Draft BURR Site Priority for Housing Reuse,” dated December 2010, which included basic information on 39 sites (rather than the final 38), such as square footage, physical potential for housing, need for housing, and financing availability. However, this document did not include 21 of the 38 lease agreements. Subsequently, they provided us with a BURR project list from the third quarter of 2011 that did not mention 19 of the 38 lease agreements. Further, since the time that VA identified the 38 sites, some of those sites are no longer on the list, and additional sites are now categorized as BURR projects, making it difficult to reconcile the original list with subsequent updates. Federal Standards for Internal Control states that documentation is required for the effective design, implementation, and operating effectiveness of a federal program, and that management considers the impact of deficiencies identified in achieving documentation requirements. In addition, management clearly documents internal control and all transactions and other significant events in a manner that allows the documentation to be readily available for examination. Further, management designs control activities so that all transactions are completely and accurately recorded. This type of readily available, clear, and complete documentation of the EUL projects could have allowed VA to more effectively implement the supportive-housing EUL program by excluding sites that it later found it could not develop. We discuss examples of such cases in the next section of this report. In 2014, VA conducted a second nationwide housing-needs analysis to determine whether any additional opportunities existed to develop supportive-housing EULs. However, according to officials this assessment did not identify any new properties. Additionally, they told us that, after further research, they found that some of the properties initially identified as part of the BURR process were not suitable for housing for homeless veterans or were not available for development. As such, the Department may not have property available for repurposing as supportive-housing in a particular location even where they have identified a need for housing based on the homeless veterans’ population in that area or where they have initially identified unused or underutilized property for that purpose, for example: Castle Point, New York, more than 30 months after VA announced it would develop supportive-housing at the site, VA discontinued its plans because additional analysis found that the site contained six unofficial and unauthorized landfills, making the property unsuitable. Chicago, Illinois: VA identified a 26,500 square foot building on the North Chicago VA campus and, in June 2011, announced it would develop a supportive-housing project at that site. Based on additional analysis, officials found that the VAMC was using part of the building for other purposes and, as such, the officials could not develop the property. Long Beach, California: VA identified 2 parcels of land totaling 10 acres at the VAMC Campus in Long Beach, California, part of Los Angeles county, which has the highest number of homeless veterans—approximately 2,700—in the United States. VA officials announced in June 2011 that they would develop a supportive- housing EUL on the Long Beach site, but later found that, due to the extent of other construction projects on the campus, there were no longer any underutilized facilities. Spokane, Washington: VA officials discovered that the land identified for development belonged to the State of Washington, and not VA, 30 months after they had announced plans for a supportive-housing EUL on the property, and they had to cancel the project. Additional properties initially identified as part of the BURR process remain on hold because they may not be suitable for development for supportive-housing. VA officials stated that they would let the interim leases expire at the end of the term in December 2016, for example: Bath, New York: The property VA selected for development was located in a flood plain with a 1 percent chance of flooding. As a result, the developer could not obtain financing for the project. VA subsequently offered a second property, not located in the flood plain, to the developer; however, the local community withdrew its support for the project because of concerns about the cost of the project and about formerly homeless veterans moving into the area. Subsequently, the project could not move forward because it did not obtain state funding. Salem, Virginia: After entering into a lease agreement, VA found there was an insufficient homeless veteran population in the area to support the project as envisioned. Our findings echo those of the VA’s Office of Inspector General (OIG) in February 2012—that major decisions were not always documented in EUL project files or populated in the VA’s database, as required by VA policy. For these reasons, the OIG reported that it was unable to determine whether the selection process was appropriate and fair. Moreover, without clear and complete records that can provide institutional knowledge to inform future decisions, VA cannot be sure that it is making the best decisions in identifying real property for use as supportive-housing for homeless veterans. According to VA officials and lessees we interviewed, stakeholder support is crucial to developing supportive-housing EULs, and opposition has prevented or delayed some EUL projects. Our prior work has consistently found stakeholder resistance to locating federal homelessness programs in some communities. Stakeholders for supportive-housing EULs represent many different groups, including veterans, local and national veteran support organizations, the local community, state and local government, and developers. VA officials told us that reaching agreement with all stakeholders can be challenging, and objections from any one of these groups could delay or prevent a project from going forward. The officials provided us with several examples of cases in which the local community did not want formerly homeless individuals living nearby (in Perry Point, Maryland, and Los Angeles, California). Or veterans wanted VA to improve the medical facilities on the campus rather than lease the property to a private developer for supportive-housing for veterans and their families (in Queens, New York, and West Los Angeles). In some cases, legislation was introduced to stop supportive-housing EUL projects. Additionally, in West Los Angeles, a 2007 law prohibited VA from selling or exchanging land on the medical campus. According to VA officials, this prohibition resulted largely from veterans’ opposition to VA’s use of property for any purpose but direct services to veterans. According to VA officials, VA could not proceed with its draft master plan for 1,200 units of supportive-housing without a change in this law. VA officials also provided us with examples of approaches they used to address stakeholder opposition. For example, in the case of the West Los Angeles campus, they held an estimated 100 town hall meetings with various community groups to hear their concerns about locating supportive-housing EULs on-site. VA officials also said they collected more than 1,000 comments on the draft master plan and, in response to these comments, modified the plan to add a town center, redesign the flow of traffic, and increase the planned housing units from 900 to 1,200. Subsequently, the West Los Angeles Act of 2016 was enacted, which authorizes VA to enter into enhanced-use leases at the West Los Angeles VAMC for the purposes of providing supportive-housing to benefit veterans and their families, and permits VA to proceed with its draft master plan. Lessees rely on multiple funding sources for both capital and operational financing, including, the Low Income Housing Tax Credit (LIHTC) program, government grants, low-interest federal loans, and rental subsidies for residents. According to a senior official of the National Equity Fund—an organization that specializes in financing affordable housing with LIHTCs—these resources play a key role in creating affordable rental housing for veterans. VA officials told us that HUD- VASH project-based vouchers are important to EUL projects for rental payments as they are attached to the project for a period of 15 years. The process of obtaining funding for supportive-housing projects can be highly competitive, and the EUL lessees have to meet program requirements for each funding source from government and private entities, such as the HUD-VASH or LIHTC. In other cases, however, lessees have successfully obtained a range of financing sources to develop a supporting-housing EUL. Figure 4 illustrates the complexity of financing necessary for a supportive-housing EUL in Minnesota. VA’s existing policies for the EUL program are outdated and reference the EUL authority from 1991, which is no longer in effect. As discussed earlier, prior to 2012, VA’s EUL authority allowed it to develop a wide range of projects where the EUL contributed to VA’s mission, enhanced- use of the property, and would not adversely affect VA’s mission. In August 2012, legislation was enacted that limited VA’s EUL authority to the development of supportive-housing for homeless veterans. VA’s policy does not discuss the current program mission—to provide supportive-housing for homeless veterans—or outline specific considerations—such as addressing stakeholder opposition and obtaining financing for supportive-housing EULs. Identifying and developing real property to meet the housing and supportive service needs of homeless veterans is different from identifying and developing real property for other types of EULs, such as administrative offices, parking, hospice centers, and child-care facilities. Federal Standards for Internal Control state that management should periodically review policies, procedures, and related control activities for continued relevance and effectiveness in achieving the entity’s objectives or addressing related risks. VA reported that it updated its policy Directive and Handbook 7454 in June 2012. However, that update did not address the current EUL authority, specifically the inclusion of the provision that EULs can only provide for housing for homeless veterans. Further, the update did not revise the development phase of its process to address relevant needs for supportive-housing for homeless veterans, such as the type of housing needed for the local area or the space configuration or square footage needed for supportive-housing as compared with available VA property. VA officials told us that they had not updated the policy Handbook to address the changes in the current law because they were anticipating an amendment to its EUL authority that would again allow the use of EULs for purposes other than supportive-housing for homeless veterans. As of October 2016, VA officials told us that they were in the process of revising the Handbook to address the current EUL authority and related information such as financing options, which may be useful for lessees, and that they expected to complete it by December 2016. VA officials said they expect to update other EUL policies during fiscal year 2017. The draft that VA shared with us requires an analysis of the local market, including current and anticipated supply and demand conditions affecting the project. However, it does not specifically provide direction on how to determine whether a proposed supportive-housing EUL meets the need for homeless veteran housing in the local area or discuss VA’s limited authority to provide housing for homeless veterans. VA officials told us that they do assess whether the homeless veteran population can benefit from supportive-housing in the area of a proposed EUL. For example, since 2013, VA has conducted a gap analysis as part of its effort to determine the need for homeless veteran programs such as HUD-VASH, SSVF, and GPD. However, this assessment is not included in the draft Handbook. Without policies and procedures that address needs specific to supportive-housing for homeless veterans, VA may not be well positioned to identify viable supportive-housing EUL projects and help ensure that those projects are successfully developed. As a result, VA may not be making the most effective use of public resources to serve homeless veterans. HUD-VASH, GPD, and SSVF each differs in its eligibility requirements and the population it serves (see app. III). Program eligibility, resource availability, and veteran choice determine veteran program participation. USICH, VA, and HUD have advocated placing veterans and their families in permanent housing through HUD-VASH and SSVF and using GPD’s service-intensive transitional housing only if veterans refused permanent housing. However, USICH officials stated that they recognize that veterans should be provided meaningful choices, and USICH guidelines on ending veteran homelessness recognize that some veterans may decline permanent housing and choose to enter GPD or other transitional housing. Each of the three programs provides a range of supportive services to veterans (see table 4). Case management services, which vary by the level of veteran engagement and need, are required in the HUD-VASH program and generally required in the SSVF program. VA officials stated that veteran participation in other supportive services provided by HUD-VASH, GPD, and SSVF is voluntary and dependent on program design and veteran needs. Eligible veterans may use any of the three programs, but there are limits on the extent to which they may do so concurrently. For example, generally an SSVF participant cannot receive rental assistance as part of SSVF’s temporary financial assistance payments while also receiving a housing subsidy through a HUD-VASH voucher. VA officials stated that VA tracks the number of veterans participating in HUD-VASH, GPD, and SSVF, but generally does not track the number of veterans using the individual services in association with each program. From fiscal year 2012 to fiscal year 2016, almost twice as many chronically homeless and vulnerable veterans used HUD-VASH vouchers to find housing, from about 37,000 in fiscal year 2012 to about 72,500 in fiscal year 2016, as reported by VA (see table 5). VA’s data showed that as of September 30, 2016, 72,481 formerly homeless veterans were living in HUD-VASH supported housing; this number represents about 92.3 percent of the vouchers that HUD authorized, exceeding VA’s target of a 92 percent utilization rate. In addition, public-housing authorities issued about 5,100 (6.5 percent) vouchers to veterans who were still trying to find housing and about 1,300 (1.7 percent) vouchers were reserved for veterans undergoing public-housing-authority application processing. VA also targets the percentage of veterans housed within 90 days of admission to the HUD-VASH program at 65 percent and reported the fiscal year-to-date measurement for September 30, 2016 as 58 percent. Service providers at several supportive-housing EULs we interviewed said that they accept tenant-based HUD-VASH vouchers or have some residents who hold these vouchers. The total number of veterans subsidized by tenant-based HUD-VASH vouchers at supportive-housing EULs is unknown because VA does not specifically track the usage of tenant-based vouchers at these locations. However, VA does track the number of project-based HUD-VASH vouchers allocated to EULs. From fiscal years 2010 through 2016, HUD allocated 942 project-based HUD- VASH vouchers through HUD’s set-aside award process to 22 supportive-housing EULs. According to VA and HUD officials, as well as officials from the National Alliance to End Homelessness, some veterans may not be able to use their HUD-VASH vouchers because they face difficulties finding affordable and suitable housing in certain housing markets. For example, the maximum allowable amount of HUD-VASH housing assistance payments may be inadequate in some areas, and low rental vacancy rates in some markets have resulted in a lack of housing availability for veterans. National Alliance to End Homelessness officials stated while the housing assistance payments from HUD-VASH were supposed to keep up with increasing rental rates, this has not been the case. To address this issue, HUD officials stated that HUD has granted permission for some public-housing authorities to increase the housing assistance payments for housing in some high cost cities. Officials in the city of Los Angeles stated that the city received an increase in housing assistance payments in February 2016 and that as of August 2016, about half of the veterans found housing using the higher housing assistance payment amount. However, the low vacancy rate in Los Angeles still presents a challenge for the time it takes to find housing using HUD-VASH vouchers. Los Angeles county officials stated that as compared to the prior year, the average number of HUD-VASH voucher holders who found housing increased. However, in addition to housing assistance payments, Los Angeles county officials pointed to other efforts, such as providing incentives to landlords to hold vacant units for veterans and increasing the number of staff and housing locators for HUD-VASH, as contributing to the increase. According to VA officials we interviewed, some veterans may also have difficulty finding housing that complies with HUD’s housing quality standards. HUD and VA officials stated that they are working to raise landlords’ awareness of the HUD-VASH program. Agency data and studies we reviewed indicate that HUD-VASH vouchers, which veterans may use for as long as needed, are associated with stable housing and staying with the program for several years. One study, published in 2010, found that veterans who used the vouchers tended to participate in the program for over 2 years and another academic study, published in 2013, found that 93 percent of veterans who used the vouchers stayed in housing for at least 1 year. HUD estimated that HUD-VASH voucher turnover was about 8,400 for calendar year 2015, which may include veterans who no longer needed the vouchers, as well as those veterans who “negatively exited” the program. One of the studies cited earlier, for example, found that about half of the veterans who left the program left because they were over the income limit or no longer needed the program. VA data indicated that for fiscal year 2016, the percentage of veterans negatively exiting from the program was 16.4 percent, meeting VA’s target of 18 percent or less. Representatives from three locations USICH certified as having ended veteran homelessness (Virginia, Las Vegas, and Houston) stated that the HUD- VASH program was instrumental in ending chronic veteran homelessness in their communities. From fiscal years 2012 through 2016, the number of veterans served by the GPD program, as reported by VA, remained relatively steady (see table 6). In the same period, the number of beds available through the program increased in fiscal years 2013 and 2014, but fell in 2015 and 2016, with a decline of about 700 beds in fiscal year 2016 as compared to fiscal year 2015. VA reported that from fiscal years 2012 through 2016, the average length per stay for GPD participants ranged from 183 to 201 days. As of August 2016, service providers at five supportive-housing EUL sites provided GPD program services, including 214 transitional beds. As part of VA’s plan to end veteran homelessness, VA called for transitional housing programs to focus on discharging veterans directly to permanent housing. The GPD program set a target of 65 percent for veterans that entered transitional housing to leave the program for permanent housing in fiscal year 2014 and reported that it exceeded those targets in fiscal years 2014 through 2016 (see table 6). In fiscal year 2014, VA also set the target for negative exits from the program at 30 percent; VA reported that GPD negative exits were below the target rate for fiscal years 2014 through 2016. Those negative exits included instances where veterans violated program rules, failed to comply with program requirements, or left without consultation with staff. In March 2016, VA issued guidance encouraging GPD service providers to adjust their provision of transitional housing by allocating some of their GPD beds toward bridge housing. Bridge housing generally provides beds for short-term stays (up to 90 days) when a veteran (who may not be in the GPD program) has been offered and accepted permanent housing assistance, but that housing is not yet available. VA stated in its guidance that adding bridge housing would help the GPD program to better align with VA’s strategy of quickly placing homeless veterans into permanent housing without encountering barriers. Officials from USICH and representatives from the city and county of Los Angeles and the Commonwealth of Virginia, stated that some GPD programs have historically placed restrictions on entering the program, such as requiring veterans to obtain substance abuse treatment prior to obtaining housing. In conjunction with VA’s guidance, USICH has encouraged communities to limit the use of GPD service-intensive transitional housing and to use transitional housing as “bridge housing” whenever possible to limit restrictions to entry. Veterans and their family members participating in the SSVF program increased from about 33,000 in fiscal year 2012 to about 157,000 in fiscal year 2015, then declined by about 8,500 in fiscal year 2016, as reported by VA (see table 7). VA officials explained that the program’s expansion had coincided with increased fiscal year funding. VA officials additionally stated that, while the number of participants served in fiscal year 2015 declined, placements into permanent housing through the program increased mostly due to rapid re-housing efforts. For SSVF’s homelessness prevention efforts, VA reported that in fiscal year 2016, the program prevented about 92 percent of at-risk program participants from becoming homeless. The program rules also require service providers to use at least 60 percent of SSVF resources toward rapid re-housing intervention but set a goal of 70 percent. VA reported that in fiscal year 2016, about 70 percent of veteran households that SSVF served received rapid re-housing interventions, resulting in 78 percent of the participating households being discharged to permanent housing. Factors such as a veteran’s income and existence of disability affect the placement rate. VA’s data showed that those with higher monthly incomes were more likely to move into permanent housing upon leaving the program. Conversely, VA stated that disability could be a barrier to housing placement. In fiscal year 2014, VA found that more than half (55 percent) of the veterans participating in the program had a disabling condition. Rental assistance made up the majority of the temporary financial assistance provided through SSVF, followed by funding for housing security deposits (see table 8). At several supportive-housing EUL sites, service providers we spoke with stated that SSVF provided assistance, such as security deposits to veterans. However, the number of veterans that received SSVF assistance in conjunction with supportive-housing EULs is unknown because VA does not specifically track how many veterans access SSVF at supportive-housing EUL sites. SSVF focuses on short-term interventions. For example, VA officials stated that from fiscal year 2012 through 2015, participants received rental assistance ranged from 93 to 109 days. Two studies found the SSVF program helped veterans to maintain housing. A 2014 VA study found that the vast majority of veterans who participated in SSVF did not experience an episode of homelessness 1 year subsequent to the program. Another research study, published in 2015, found that a majority of veterans had either maintained their housing (in the case of prevention efforts) or obtained housing (in the case of rapid-re-housing efforts) 2 years after exiting the SSVF program. Representatives we interviewed from New Orleans and the Las Vegas metropolitan area said that the SSVF program was instrumental for rapidly re-housing veterans. Additionally, representatives from Houston stated that SSVF created new resources outside of existing programs that helped in ending veterans’ homelessness. Representatives from New Orleans stated that most of the currently homeless veterans in their area are recently homeless or transient, and generally have less severe health or disability issues in comparison to populations of homeless veterans that received housing in the past. They anticipate that SSVF, more than other programs, will help recently homeless veterans. VA has collaborated with other federal agencies, lessees, and homeless service providers to increase the number of supportive-housing EULs and help veterans obtain housing, health care, and other services through HUD-VASH, GPD, and SSVF programs. Within a 2-year time frame, the BURR initiative identified and VA executed interim leases for 38 sites for development as supportive-housing EULs. However, VA officials did not completely document their decision-making process for selecting properties, or other key information, as required by standards for internal control and their own policy. Without such documentation, VA cannot systematically make use of the knowledge gained from this initiative to help identify and develop future properties as supportive-housing EULs. In the future, documenting the steps taken to identify and develop these sites, as well as the additional information required by VA policy, could help VA ensure that the properties it identifies are viable for meeting veterans’ needs for supportive-housing. Further, VA has not updated its policy to reflect the 2012 change in its EUL authority limiting it to solely developing supportive-housing EULs for veterans. Federal Standards for Internal Control state that management should periodically review policies and related control activities for relevance and effectiveness in achieving the entity’s objectives. At the completion of our audit work, VA officials told us that they were in the process of updating their policy and expected to complete it by the second quarter of 2017. In addition to the lack of consistency with the current authority, VA has not specified in its policy how identifying properties for use as supportive-housing EULs for veterans differs from other types of EULs the agency has used in the past. Incorporating these changes into its policy may better position VA to identify feasible projects as well as potential delays in completing those projects, thereby allowing the VA to expedite development of additional supportive-housing EULs. With improved documentation and policies, VA may make a greater contribution toward ending veterans’ homelessness. To improve VA’s supportive-housing EUL program and meet the needs of homeless veterans, we recommend that the Secretary of Veterans Affairs should direct the Office of Asset Enterprise Management to take the following two actions: clearly and completely document the selection process for all supportive-housing EULs from pre-development through completion of VA’s development phase in keeping with internal control standards and VA policy, and; update its EUL policy to (1) address the current authority for developing supportive-housing; and (2) specify how to identify properties for supportive-housing EULs to meet the needs of homeless veterans. We provided a draft of this report to HUD, USICH, and VA for review and comment. We also provided a draft of the relevant EUL profile in Appendix V to lessees and service providers for each of the 13 supportive-housing EULs we visited. We received technical comments from HUD, USICH, and VA, as well as several of the lessees, and we incorporated those comments where applicable. In addition, both USICH and VA provided written responses to our report (reproduced in appendixes VI and VII respectively). USICH agreed with our report’s perspective that the EUL program is among the key strategies that meaningfully contribute to the supply of supportive-housing opportunities needed to end veterans’ homelessness and to meet the needs of veterans in the future. USICH’s comments also noted the importance of the other programs discussed in our report— HUD-VASH, SSVF, and GPD—in contributing to and sustaining the progress in ending veterans’ homelessness. VA concurred with both of our recommendations, and discussed planned actions to address them; however, VA disagreed with some of our findings. With respect to our finding that VA did not fully document the decision-making process in selecting supportive-housing EULs in keeping with internal control standards and VA policy, VA stated that it believes it did document the selection process for the supportive-housing EUL agreements. However, VA acknowledged that stakeholders could have benefited from a single formal report as an effective communication tool and to help ensure the transfer of institutional knowledge. VA stated that, going forward, it will continue to enhance its documentation process to keep in line with internal control standards. VA also stated that we conclude that the lack of a single formal report to document how it selected the BURR sites means that it missed key factors to choose optimal sites. In fact, we do not point to the lack of a single formal report, nor do we specify the type of documentation VA should prepare for the selection of supportive-housing EULs going forward. Rather, we discuss the difficulty we had in reconciling the multiple lists with different EUL sites VA provided to us at different points in time. We made over 10 formal requests for information and clarification on the sites selected, and VA did not provide us with comprehensive documentation on the reasons why they selected certain properties over others for development. We discuss the importance of clear documentation in the context of maintaining sufficient internal controls for program management and informing future decisions. In addition, we do provide several illustrative examples of sites that VA initially selected that missed key factors that prevented the development of the site. For example, VA later learned that one site was not located on VA property, another site was already used for other purposes, and another no longer had underutilized facilities. We point out that additional documentation could have allowed VA to more effectively implement the program by excluding sites such as these. With regard to our second recommendation, VA stated that it is in the process of updating its EUL policy and guidance to specifically document requirements, which are detailed in the agency’s comment letter (see app. VII), and it expects to complete the update by the end of the second quarter of 2017. Among the requirements, it refers to a review of market conditions, such as homeless populations to be served and the services they may require. However, VA does not specifically state that it will address how to identify properties that can meet the needs of homeless veterans. We continue to believe that VA should include this objective in its policy because, as discussed in our report, not all properties are suitable for housing the population the EUL program is required to serve. In its comments, VA noted some additional points they felt we should include in our report. However, we did cover these points to the extent applicable. In particular, VA raised an overall concern that the theme of our report does not take into account the entrepreneurial spirit and private sector dependency that are fundamental to the EUL program. To the contrary, we make these points clear throughout our report, by discussing the multiple parties (e.g., public housing authorities, private development corporations, non-profit lessees, and service providers) that play key roles in the success of the EUL program. We discuss the range of services provided and the benefits to VA, lessees, developers, and the local community through participation in the program. We note that VA reported that its ability to retain EUL lease proceeds provides it with an incentive to be creative and aggressively pursue opportunities to collaborate with both private and non-profit entities. Further, we describe some of the key challenges that come with providing services through multiple parties—such as transportation, mail delivery, and law enforcement. And, we acknowledge the complexity of financing supportive-housing EULs through multiple funding sources. In sum, our report acknowledges VA’s successful development of 35 active supportive-housing EULs, 6 under construction and 16 in development, notwithstanding the challenges faced with identifying suitable properties, stakeholder coordination, and obtaining sufficient financing. We believe that the improvements in documentation and updated policy that we recommended and VA has agreed to make will help to ensure that the supportive-housing EUL program continues to make an important contribution toward ending veterans’ homelessness. We are sending copies of this report to the appropriate congressional committees, the Secretary of Veterans Affairs, the Secretary of Housing and Urban Development, the Executive Director of the United States Interagency Council on Homelessness, points of contact from the 13 EULs we visited, and other interested parties. In addition, the report is available at no charge on the GAO website at http://www.gao.gov. If you or your staff have any questions, please contact David Wise at (202) 512-2834 or Wised@gao.gov or Alicia Puente Cackley at (202) 512-8678 or Cackleya@gao.gov . Contact points for our Offices of Congressional Relations and Public Affairs may be found on the last page of this report. GAO staff who made major contributions to this report are listed in appendix VIII. This report examines: (1) how the U.S. Department of Veteran’s Affairs (VA) uses enhanced-use leases (EUL) to provide supportive-housing and services; (2) VA’s plans to develop additional supportive- housing through EULs and how past plans have been implemented, and (3) how the Department of Housing and Urban Development and Department of Veterans Affairs Supportive-Housing (HUD-VASH) program; the Grant and Per Diem (GPD) program; and the Supportive Services for Veteran Families (SSVF) program have helped support the goal of ending veterans’ homelessness. This report focuses on VA’s supportive-housing EULs. To examine how VA uses its EUL authority to provide supportive-housing to veterans, we collected and analyzed data from VA on the 35 active and other supportive-housing EULs from July 1998 to September 2016 and reviewed VA’s annual “EUL Consideration Report.” The data included project location, project status, housing type, the award date for the lease, number of housing units, and the year the facility began operating. We analyzed the number of EULs by housing type to determine what percentage of the housing units were permanent housing. We assessed the reliability of the data through interviews with knowledgeable VA officials and a review of the data for completeness and potential outliers. We determined that the data were sufficiently reliable for the purposes of providing summary information about supportive-housing EULs. Of the 35 active supportive-housing EULs, we conducted site visits to 13 supportive-housing EULs located on VA medical center (VAMC) campuses. Specifically, we visited the following supportive-housing EULs: one in Lyons, New Jersey; four in Dayton, Ohio; one in St. Cloud and two in Minneapolis, Minnesota; three in Hines, Illinois; and two in Sepulveda, California. We judgmentally selected these 13 supportive-housing EULs to include a range of geographic locations, a variety of stakeholders (e.g., public, private, and non-profit lessees and service providers); housing types (e.g., transitional and permanent housing); and with leases spanning a range of years. At these site visits, we interviewed VA officials from the Office of Asset Enterprise and Management (OAEM), Office of General Counsel, local VAMC officials, lessees (some of which were developers), and service providers to understand factors involved in developing the EULs, the supportive services provided, and the benefits of developing supportive-housing through the EUL program. The information from our site visits is illustrative of issues affecting particular sites and cannot be generalized to VA sites agency-wide. To understand how VA’s EUL authority has supported housing for homeless veterans, we interviewed officials from the U.S. Interagency Council on Homelessness (USICH)—an independent federal agency composed of 19 Cabinet secretaries and agency heads, and not-for-profit veterans organizations concerned with veterans’ homelessness: The National Alliance to End Homelessness, National Coalition for Homeless Veterans, U.S. Vets, Vietnam Veterans of America, and the National Equity Fund. To examine VA’s plans to develop additional supportive-housing and how VA implemented past plans, we analyzed VA data from July 1998 to September 2016 for projects under construction, development, and on hold. We assessed the reliability of the data through interviews with knowledgeable VA officials and a review of the data for completeness and potential outliers. We determined that the data were sufficiently reliable for the purposes of providing summary information about supportive- housing EULs. We also interviewed VA headquarters, local VAMC officials, lessees, and service providers as part of our 13 site visits. Five of the six VAMC campuses that we visited had supportive-housing EULs under development or construction. These VAMC campuses are located in Hines, IL; Lyons, NJ; Dayton, OH; and Minneapolis, and St. Cloud, MN. Additionally, we spoke to OAEM officials and local VAMC officials in Los Angeles, where VA is planning additional supportive-housing EULs. We also analyzed information on VA’s Building Utilization Review and Repurposing (BURR) initiative to identify VA’s proposed plans for and completed supportive-housing EULs. Additionally, we reviewed VA’s policies on EULs, including VA Handbook 7415 and VA Directive 7415, which contain EUL policies and procedures; and VA Handbook 7454 and VA Directive 7454, which contain policies and procedures for oversight and management of EULs. To understand potential challenges in developing EULs, we interviewed OAEM officials, local VAMC officials, lessees, and service providers at the 13 operating supportive-housing EULs about the challenges of developing an EUL. We reviewed and analyzed leasing agreement documents, directives, agency policy, guidance, and VA reports. We also reviewed VA’s Strategic Plan, VA Office of Inspector General’s (OIG) work, and our prior work related to EULs and lease agreements. We also reviewed the Standards for Internal Control in the Federal Government. To describe how VA leverages key programs to support the goal of ending veterans’ homeless, we examined three key housing programs: HUD-VASH, GPD, and SSVF. For each program, we asked VA for information about its performance targets and outcomes for fiscal year 2012 onward and the role these programs play in providing rent subsidies and services for supportive-housing EULs. We assessed the reliability of the data through interviews with knowledgeable VA officials and a review of the data for completeness and potential outliers. We selected fiscal year 2012 because we had conducted a review of the HUD-VASH program that captured its performance for 2012—the year in which SSVF began operation. Selecting fiscal year 2012 also allowed us to capture the program outcomes in the years after VA and other agencies announced their goal to end veterans’ homelessness. We conducted a literature review to identify available and relevant research on the effects of the three programs on homeless veterans. We identified relevant studies, surveys, and analyses published by industry associations, academics or research entities, and federal agencies. A GAO social scientist assessed the design and methods of each study and determined they were sufficient to support the findings we cite in this report. Additionally, we interviewed VA’s Veterans Heath Administration Homeless Program Office and HUD officials about relevant studies. We reviewed HUD and VA guidance and policies on HUD-VASH, including notices HUD issued on set-aside funding availability for project-based HUD-VASH vouchers; VA’s Veterans Health Administration’s (VHA) Handbook 1162.05 on the procedures for the HUD-VASH program, and VA’s Resource Guide on HUD-VASH. Additionally, we reviewed guidance and policies VA has published on GPD and SSVF, including the VHA Handbook 1162.01 on the procedures for the GPD program and VA’s SSVF Program Guide. To understand how these programs have supported housing for homeless veterans and supportive-housing EULs we visited, we interviewed officials from the following organizations: VA’s VHA; the Department of Labor; USICH; National Alliance to End Homelessness; National Coalition for Homeless Veterans; EUL lessees and service providers; and officials from the city and county of Los Angeles, which has the largest population of homeless veterans in the United States. Furthermore, to understand the roles the programs played in ending veteran homelessness in specific areas, we interviewed officials from Houston, Texas; New Orleans, Louisiana; the Las Vegas metropolitan area; and the Commonwealth of Virginia—all areas USICH certified as having ended veteran homelessness. We selected Houston, New Orleans, and the Las Vegas metropolitan area because, among the areas that ended veteran homelessness, they had the highest number of homeless veterans in 2011—the first year of the national effort to end veteran homelessness. We selected Virginia because it had a higher number of homeless veterans in 2011, as compared to Connecticut, the other state that had ended veteran homelessness at the time of our review. In Houston, we spoke with representatives from the local VA medical center, the Houston mayor’s office, and representatives involved in the local SSVF and HUD- VASH program. Similarly, in New Orleans, we spoke with representatives from the local VA medical center and three service providers involved with the local SSVF and HUD-VASH programs. In the Las Vegas metropolitan area, we spoke with the Combined Working Group to End Veteran Homelessness, which included representatives from VA, HUD, city of Las Vegas, and several service providers. In Virginia, we interviewed representatives of the Governor’s Coordinating Council on Homeless Veterans. We also reviewed USICH’s criteria and benchmarks for ending veteran homelessness. Additionally, we reviewed our prior work on veteran homelessness and the HUD-VASH program. We conducted this performance audit from October 2015 to December 2016 in accordance with generally accepted government auditing standards. Those standards require that we plan and perform the audit to obtain sufficient, appropriate evidence to provide a reasonable basis for our findings and conclusions based on our audit objectives. We believe that the evidence obtained provides a reasonable basis for our findings and conclusions based on our audit objectives. Appendix III: Participant Program Eligibility for Three Key Veterans’ Housing Programs 38 U.S.C. §101(2); 38 C.F.R. § 3.1(d). A veteran is defined in statute as a person who served in the active military, naval or air service, and was discharged or released under conditions other than dishonorable. 38 U.S.C. § 101(2). There are currently five types of discharges: (1) honorable; (2) general; (3) other than honorable conditions or undesirable; (4) bad conduct; and (5) dishonorable. Public — Housing Authority of the City of Vancouver Private — Vietnam Veterans Workshop, Inc. 12/30/2004 Nonprofit — Miami Valley Public — St. Cloud Housing and Redevelopment Authority Public — Hennepin County Housing and Redevelopment Authority Private — New Directions Sepulveda I L.P. Private — New Directions Sepulveda II L.P. Private - Bedford Place, LLC (Peabody Properties) Private — Hines Veterans Residences L.P. (Communities for Veterans) Private - Freedoms Path at Kerrville (Communities for Veterans) Private — Valley Brook Village I, LLC (Peabody Properties) Private - Vancouver Veterans Residences, LP (Communities for Veterans) Private — Cloudbreak, Hawaii, LLC Private — Eisenhower Ridge Association (Pioneer Group, Inc.) Private — Cazenovia Recovery Systems, Inc. 12/27/2011 Nonprofit - Soldier On Private — PVII Viera Manor Private — Danville VA L.P. Nonprofit — Volunteers of America of Greater Ohio Private — Medallion Management, Inc. Public — Housing Authority of Salt Lake City Private - Howard House, LLC (Peabody Properties) 12/27/2011 Nonprofit - CBVA St Private - Chillicothe Veterans Residences, LP (Communities for Veterans) Private - Grand Island, LLC (Pioneer Group) Private - Augusta Veterans Residences (Communities for Veterans) Private - Fort Harrison Veterans, LLP (Communities for Veterans) Private — Hines Veterans Residences L.P. (Communities for Veterans) Private - Augusta Veterans Residence, LPs (Communities for Veterans) Private - America First Real Estate Group 12/30/2011 Nonprofit - Help USA Private - Northport Seniors, LLC (Communities for Veterans) Private — PVII Viera Manor Private — Medallion Management, Inc. In 2016, up to $26,950 (one person) or $30,800 (two persons) Up to 60 percent area median income or $22,100 (for units with a HUD subsidy) or $25,920 (for units without a HUD subsidy) In addition to the contacts named above, Amelia Shachoy (Assistant Director), Marshall Hamlett (Assistant Director), Nelsie Alcoser (Analyst in Charge), Russell Burnett, Delwen Jones, Joshua Ormond, Ernest Powell, Susmita Pendurthi, Kelsey Sagawa, Jessica Smith, Crystal Wesco, Daniel Will, and Weifei Zheng made key contributions to this report.

Summary: In August 2016, HUD and VA announced that the number of homeless veterans in the United States had been cut nearly in half since 2010 to less than 40,000. Part of this effort is the EUL program, which uses unneeded federal property (land or buildings) for housing for homeless veterans. GAO was asked to review VA's EUL program and other efforts to end veteran homelessness. This report examines: (1) how VA uses EULs to provide supportive-housing and services, (2) VA's plans to develop additional supportive-housing through EULs and how past plans have been implemented, and (3) how HUD-VASH, GPD, and SSVF have helped support the goal of ending veterans' homelessness. GAO analyzed agency documents, VA data on enhanced-use leases, and VA data on the HUD-VASH, GPD, and SSVF programs. GAO visited 13 active supportive-housing EUL sites, selected to provide a range of locations and housing types. GAO interviewed VA and HUD officials, lessee representatives, service providers, and veteran organizations. As of September 2016, for veterans who were homeless or at risk of homelessness, the Department of Veterans Affairs (VA) had developed 35 enhanced-use leases (EUL) for supportive-housing with low cost rental housing and coordinated access to medical, rehabilitative, mental healthcare, and other services. Each supportive-housing EUL is located on a VA medical center campus. Some lessee representatives told GAO that having access to federal property at little or no cost helped them to rehabilitate or build facilities to create supportive-housing. Furthermore, they noted that the close proximity to VA healthcare services allowed them to invest in other needed services for homeless veterans, such as counseling, job training, and quality-of-life amenities. VA has plans to develop additional supportive-housing EULs, 6 of which are under construction and 16 in development. However, VA needs to improve its documentation and update its policies to develop additional EULs. VA officials did not provide clear and complete documentation for the selection of supportive-housing EUL projects, as required by VA policy, and Standards for Internal Controls in the Federal Government. Completely documenting this decision-making process for selecting properties could provide institutional knowledge to inform future decisions. Also, Standards for Internal Controls in the Federal Government states that management should periodically review policies and procedures for continued relevance and effectiveness of a federal program, and that management considers the impact of deficiencies identified in achieving documentation requirements. VA's existing policy on EUL projects is outdated. For example, it refers to an EUL authority that previously allowed the development of a full range of EUL projects. However, this authority is no longer in effect. VA is updating its EUL policy; however, the updated draft policy still does not discuss VA's limited authority to provide housing for homeless veterans. Further, the updated draft policy does not specifically provide direction on how to determine whether a proposed supportive-housing EUL meets the needs of homeless veterans. Without documented policies and procedures that address these needs, VA may not be well positioned to identify viable supportive-housing EUL projects and help ensure that those projects are successfully developed. Three programs—Housing and Urban Development and VA Supportive-Housing (HUD-VASH), VA's Grant and Per Diem (GPD), and Supportive Services for Veteran Families (SSVF)—were used in conjunction with supportive-housing EULs to help support the goal of ending veteran homelessness. From fiscal years 2012 to 2016, the number of chronically homeless and vulnerable veterans housed through the HUD-VASH program increased from about 37,000 to 72,500. Community officials GAO interviewed stated that the HUD-VASH program has been instrumental in reducing chronic veteran homelessness. From fiscal years 2012 to 2016, veterans served by the transitional housing-focused GPD program remained relatively steady. Veterans and their family members participating in the SSVF program increased from about 33,000 in fiscal year 2012 to 149,000 in fiscal year 2016. According to the VA, rental assistance made up the majority of the temporary financial assistance provided by the SSVF program. GAO recommends that VA (1) document its decision-making process in selecting projects as required by VA's policy and (2) update its policy to address the current authority and specify how to identify properties for supportive-housing EULs to meet the needs of homeless veterans. VA concurred with both recommendations but disagreed with some of GAO's findings. GAO believes its findings are valid based on the evidence presented.