Homeless Shelter Funding "Cliff" Looms for Bend, Central Oregon - The Source

Homeless shelter providers in Central Oregon are staring down the potential closure of hundreds of beds by this time next year as they face a steep drop in the state and federal funding that local officials say helped turn a crisis around.

Without additional funding, the local shelter network will see cuts in the millions of dollars — a combination of expiring pandemic relief money and state budget woes officials have identified as a funding “cliff.” Local governments in Central Oregon have used stopgap measures to delay the effects of budget woes faced by shelters across the state.

But now, leaders face a collision of unfortunate events; coincidentally, funding for hundreds of shelter beds is expected to dry up the same day they plan to close the region’s largest sanctioned encampment, now home to about 200 people.

“It’d be devastating,” Amy Fraley, senior program manager for houselessness services with the City of Bend, told the Source.

With shelter funding uncertain, Bend may attempt to use City-owned land to jumpstart low-cost supportive housing as an alternative solution.

According to Fraley, state money flowing to Central Oregon for homeless shelters is expected to drop from $10 million to $5 million starting midway through 2027. And it’s already started to dwindle, down from a little more than $11 million in the fiscal year that ended July 1.

In 2025, the Oregon State Legislative Assembly created a new statewide shelter funding model, meant to sustain new beds created by a series of Gov. Tina Kotek’s emergency executive orders dating back to 2023. That funding pumped millions of one-time dollars into Central Oregon for shelters, rehousing and eviction prevention.

Kotek, along with local officials, have pointed to Central Oregon as an example of how investments have thwarted the rising homelessness crisis, citing the most recent Point In Time Count showing a 19% drop in homelessness numbers.

Shelter expansions have been accompanied by an uptick in homeless camp sweeps across government-owned lands in Central Oregon.

In Bend alone, the executive order funding paired with federal pandemic relief money and other legislative funding led to 260 new shelter beds in the last several years, according to Fraley.

Last year, lawmakers approved a little more than $200 million to fund the statewide shelter program, while slashing eviction prevention programs as they cut budgets across state agencies due to economic uncertainties.

Central Oregon used savings to sustain many shelters, delaying the effects of dwindling shelter funding, Tammy Baney, executive director of Central Oregon Intergovernmental Council, told service providers in a meeting July 24.

“The pain we are feeling this year is the pain that many communities were feeling last year,” Baney said.

The intergovernmental council, a quasi-government agency that works across Jefferson, Crook and Deschutes counties, was tasked with administering the state’s shelter program. According to Baney, shelter providers across Central Oregon recently requested a total of $12.4 million to sustain operations — $2.6 million more than available.

The state rules instruct regional administrators to prioritize funding for shelters already supported by the state.

In an email, COIC staff provided a list of nine shelters identified to receive funding across Central Oregon, from the warming shelter in La Pine to large congregate shelters in Bend to Warm Springs. The goal is to sustain nearly 400 shelter beds in Central Oregon.

But the list leaves out some providers like Central Oregon Villages, an outdoor shelter in Bend with about 25 beds in small personal units, as well as a smaller safe parking site.

“We are very disappointed in the current funding strategy for SSP funds,” Executive Director Scott Jones told the Source via email.

Still, Jones said he’s optimistic the shelter can continue operations.

In February, the Bend City Council allocated $1.7 million in land sale revenue to support several shelters through June of next year, including Central Oregon Villages, safe parking sites and the Lighthouse Navigation Center, Bend’s largest shelter.

“I’m relived and grateful to know the City of Bend is thinking that far out, and we have funding through the end of the fiscal year,” said Rick Russell, a county commissioner-elect and director of Mountain View Community Development, Central Oregon’s largest provider of safe parking. “In sheltering, anytime we’ve got six months of funding lined out, that feels like a pretty long runway.”

The nonprofit also is on the list for nine units of state shelter funding in Redmond. But Russell said he’ll likely have to close some safe parking sites in Redmond, where the nonprofit operates close to 40 beds. Six of those are vacant and are being left open in expectation of a funding loss.

“I expect we will be closing a lot more than six in the coming couple of months,” Russell told the Source.

Meanwhile, Bend is still pondering the closure of a 70-bed shelter on Franklin Avenue, a converted motel the City purchased in 2022. Back then, the City indicated the shelter would be a temporary emergency measure before helping redevelop the property as part of the Bend Central District neighborhood, but never provided a firm timeline. A staff presentation last week suggested closing the shelter within three to five years, but the City Council didn’t make any firm decisions.

With shelter funds uncertain, the City may instead shift its focus to building low-income housing with hopes to help people move from shelter and camps. According to a staff presentation, the City could sell off six acres of industrially zoned land in northeast Bend’s Juniper Ridge area to build Permanent Supportive Housing, which offers onsite services for residents.

A few miles to the north, about 200 people are still camped inside the designated “temporary safe stay area” on City of Bend and Deschutes County land. The two governments had planned to close the area by the end of 2026, but extended the closure by six months, with the new date set for June 30, 2027.