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Judge rejects deal in sprawling lawsuit over LA County homelessness

The sticking point? Direct oversight of the settlement by the federal judge overseeing the case.

LOS ANGELES (CN) — The landmark lawsuit over homelessness in Los Angeles that refuses to go away is still not going away, after a federal judge on Thursday rejected a proposed settlement that would have seen LA County spend an additional $850 million on services and outreach.

U.S. District Judge David Carter said he had "grave concerns" about the deal because it did not include a clause that he previously asked for — direct jurisdiction to enforce the terms of the settlement for the next five years, a clause the city's settlement included.

"You give me absolutely no oversight and no enforcement," Carter told the county. "I have to have accountability to sign off on this. While I may trust you, I don’t know who your successor is."

After the hearing, County Supervisor Janice Hahn said she had wanted to include the judicial oversight clause.

"It was something I tried to convince my colleagues was important," Hahn said. "I could not get them to agree to that component. They prefer to hold ourselves accountable, have the public hold us accountable."

Supervisor Lindsey Horvath, who attended the hearing, along with Hahn and LA City Council President Paul Krekorian, was opposed to handing Carter direct oversight, arguing transparency is more important.

"I agree that accountability is key," said Horvath. "We agreed to public reporting in our meetings. We don’t want this to happen behind closed doors."

Not only did Carter reject the proposed agreement, he removed the stay — meaning litigation between LA Alliance for Human Rights and the county will restart immediately.

LA Alliance for Human Rights, a coalition of downtown residents, businesses and service providers, sued in March 2020 and initially sought a "right to shelter" law. The case made national headlines in 2021 when Carter dropped a bombshell of a ruling, ordering the city and county to house every homeless person living on Skid Row within 180 days. He also ordered the $1 billion the city had earmarked for homeless spending to be frozen. But the Ninth Circuit struck down that order, finding Carter had "impermissibly resorted to independent research and extra-record evidence."

Since then, the case has proceeded in a more subdued fashion with the parties — the city, county and the alliance — meeting with the Judge in a series of closed negotiations. In April 2022, the city of LA unilaterally settled with the alliance, agreeing to build between 14,000 and 16,000 units of housing — either temporary shelter units or permanent housing — within five years, at a cost of between $2.4 billion and $3 billion. That effort, they said, would house 60% of of the city's unhoused population who were not experiencing drug addiction or serious mental illness, a population the city has always contended is the county's responsibility to care for.

It was hardly the dramatic, game-changing outcome Carter and the plaintiffs had once sought. But it signaled a shift toward an emphasis on emergency shelters rather than on permanent supportive housing. LA's new mayor, Karen Bass, has continued to focus on getting people off the street and into temporary housing, and has pledged to shelter or house 17,000 people during her first year in office.

In September 2022, the county reached an agreement with the alliance in which it offered to spend an additional $236 million over the next five years on increased services and outreach, and to pay for an additional 300 beds for homeless people struggling with addiction or mental illness. Carter rejected the proposal, saying, "I believe we can do better."

The latest agreement, announced Wednesday, included a pledge to spend an additional $850.5 million on services, outreach and interim housing, including 1,000 new beds for homeless people experiencing drug addiction and mental illness, and subsidies for 450 board and care beds, which are managed privately.


"You asked the county to do more," said the county's attorney, Mira Hashmall. "And we did more."

When asked by the Judge for his opinion on the offer, Krekorian was lukewarm.

"While this definitely shows progress, if you’re asking me whether this will be a transformative agreement, it will not be," Krekorian said. "It will be an incremental improvement."

Elizabeth Mitchell, the attorney for the alliance, defended the deal, albeit somewhat tepidly.

"We don't disagree that 1,500 beds is not going to solve this," Mitchell said. But, she said, "stepping up to 1,500 beds — that’s five times more than what we’ve seen before."

She told Carter the need for mental services to go along with facilities already opened by the city is desperate. "You have people that are going into these projects with mental illness that are not being assessed for days," she said, and noted the settlement was better than the prospect of years of litigation.

"I’m happy to fight. but what you’re looking at is three years, Ninth Circuit arguments," Mitchell said. "How bad is the crisis going to be then?"

But Carter had problems with the proposal. For one, it hadn't been approved by the Board of Supervisors yet — none of them had even signed off on it.

"In my 25 years on the federal bench, this court has never approved a settlement until the parties have signed off on that settlement," Carter said, appearing to grow more vexed the longer the hearing went on. "I look at this settlement, I’m somewhat stunned. If I deal with the principals, I expect your name to be on the settlement. So if in the future something goes sideways, elected officials can't step away."

He applauded the offer of 1,450 beds, but asked if it was enough. He noted that in 2019, the head of the county's Department of Mental Health, Dr. Jonathan Sherin, said there was a need for 3,000 beds. Carter suggested the county, with an annual budget of $43 billion, could afford to do more. He also worried that the new director of the Los Angeles Homeless Services Authority was making too much money.

And at the suggestion that the 1,450 beds would not be provided if the settlement wasn't approved, he showed a flash of anger.

"Those beds should’ve been given right now, not as a bargaining chip," Carter said. "Any implication that a non-ability to settle takes away those beds — shame on you! You quit using this as a bargaining chip with human lives."

Carter has made it clear he has private conversations with numerous elected officials. He appears to be far more impressed with Mayor Bass than the Board of Supervisors.

"Mayor Bass may not get to 17,000, but guess what, she’s trying," Carter said. "I’m not getting that same thing from the county."

As for not giving Carter direct jurisdiction, lawyers for both the county and plaintiffs told Carter he still had oversight — that if the county was found to be out of compliance, then the plaintiffs could bring the infraction to the court's attention. But Carter wanted more.

"I’m not bargaining with the parties on this," Carter said sternly. "I said I need the same provisions [that the city gave]. And you’ve chosen to ignore it."

Alliance attorney Matthew Umhofer said, "We wouldn’t have signed off on this if we didn’t think the court has sufficient purchase," to which Carter replied: "I respect that, but I don't intend to shine a light on this issue. I intend to have people live up to their word when they sign a document."

After the hearing, Supervisor Hahn said the county would be willing to make a private agreement with the alliance — the county adopts the terms of the settlement as public policy and the alliance drops its lawsuit. That would, however, leave the door open for future litigation.

"What I want to do is move forward with the agreement we have," Hahn said. "I plan to start implementing it. We already are."

But Umhofer said his firm was ready to take the lawsuit to a trial.

"We’re ready," he said. "We’ve always been ready for that. We don’t believe the county is ready."

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