TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: Brian Ambrose, Community Services Director
PREPARED BY: Brian Ambrose, Community Services Director
SUBJECT:
title
Homeless Services Funding Source Adjustment and Budget Amendment
end
ABSTRACT
This report recommends targeted adjustments to the City’s existing homeless services funding to better align City resources with current community needs while minimizing impacts to the City’s financial resources. The proposed actions include reallocating funding for street outreach services and a limited number of emergency shelter beds to Encampment Resolution Funding (ERF). These funding shifts are informed by the demonstrated success of the Murrieta Creek Project and the evolving service needs of individuals who continue to experience homelessness.
Additionally, Riverside County funding may be available in the future to support housing navigation and case management, which could further reduce reliance on the City’s financial resources. City Council action is requested to authorize the proposed funding reallocations and approve the associated budget amendment.
RECOMMENDATION
recommendation
Authorize the use of existing Encampment Resolution Funding to support a two (2)-member City Net street outreach team serving the cities of Murrieta and Wildomar;
Authorize the use of existing Encampment Resolution Funding to fund a limited number of emergency shelter beds at the Murrieta Emergency Shelter operated by Project Touch;
Authorize the use of existing Encampment Resolution Funding of approximately $109,252; and
Amend the Fiscal Year (FY) 2025/26 Operating Budget to establish an appropriation of $446,300 using General Fund Unassigned Fund Balance.
body
PRIOR ACTION/VOTE
On November 19, 2024, the City Council approved an agreement with Project T.O.U.C.H. to provide Emergency Shelter Services with a total not to exceed $2,600,862.76 over five years (Vote:5-0).
On February 18, 2025, the City Council approved an agreement with City Net for homeless street outreach and case management services at the emergency shelter for a total not to exceed $1,483,130 over two years (Vote: 5-0).
On April 1, 2025, the City Council accepted Encampment Resolution Funding (ERF) from the County of Riverside Housing and Workforce Solutions for homeless outreach activities in the amount of $6,655,713.60 (Vote: 4-0-1).
On April 1, 2025, the City Council approved an agreement for homeless outreach activities between the City of Murrieta and Kingdom Causes, Inc. dba City Net in the amount not to exceed $5,734,829.53 (Vote 4-0-1).
On September 16, 2025, the City Council approved an amendment to the FY 2025/26 Operating Budget to establish an appropriation of $562,873.92 using General Fund Unassigned Fund Balance for the Homeless Services contracts (Vote 5-0).
CITY COUNCIL GOAL
Coordinate and deliver responsive, effective community services.
History
In Fiscal Year (FY) 2016/17, the City of Murrieta was a co-founding member of the Regional Homeless Alliance (RHA), an informal collaboration among cities in Southwest Riverside County focused on addressing homeless services through a coordinated regional approach. Since that time, Murrieta has taken a leadership role in advancing regional partnerships with Riverside County and nonprofit service providers to support a more seamless homeless response system. In February 2024, the cities of Murrieta and Wildomar entered into an agreement under which Murrieta provides homeless services within Wildomar using existing agreements and service models, an arrangement that has proven mutually beneficial.
In October 2024, Riverside County, in partnership with four (4) Southwest Riverside County cities, was awarded a $12.6 million Encampment Resolution Funding (ERF) for the Murrieta Creek Project to address homelessness along the Murrieta Creek Trail. On April 1, 2025, the City Council accepted a direct allocation of over six (6) million in ERF funding as the project lead and approved an agreement with Kingdom Causes, Inc., doing business as City Net, to provide homeless outreach services. In February 2025, the City Council approved a separate agreement with City Net for street outreach and shelter-based case management, followed by approval of an agreement with Project T.O.U.C.H. in November 2025 to operate the Murrieta Emergency Shelter. As the ERF program has progressed and community needs have evolved, staff now brings this item forward to adjust funding sources, align services with current conditions, and reduce impacts to the City’s financial resources.
Analysis
Implementation of the Murrieta Creek ERF program has resulted in a significant reduction in encampments within the Murrieta and Wildomar riverbed areas, leading to a smaller, and more dispersed unsheltered population along the creek corridor. Individuals who remain unsheltered are predominantly single adults with higher service needs, requiring ongoing outreach, stabilization, and intensive case management to achieve housing outcomes.
The City Net street outreach team continues to maintain consistent engagement with this population, providing regular contact, service coordination, and housing navigation services throughout Murrieta and Wildomar. By transitioning these outreach positions to ERF, the City can sustain critical services while strategically reducing the impact on its financial resources.
Additionally, the strategic use of a limited number of emergency shelter beds provides immediate stabilization and access to onsite supportive services, including case management and healthcare. These services are essential for individuals with higher acuity needs and offer a cost-effective, flexible response by stabilizing clients while individualized housing sustainability plans are developed.
Anticipated Homeless Housing, Assistance, and Prevention (HHAP) funding from Riverside County would further support existing navigation and case management positions. This funding would strengthen regional housing navigation efforts, improve client outcomes, and further reduce reliance on local operating funds. While the City has not been awarded this grant, City staff are hopeful that the funding will be available in the near future.
Considering that the Murrieta Creek ERF program has resulted in a significant reduction in encampments within the Murrieta and Wildomar riverbed areas, leading to a smaller and more dispersed unsheltered population in Murrieta, City staff requested the ERF grantor, Riverside County, to allow the service area to expand beyond the Murrieta Creek riverbed and use funding to support the following services for the remaining grant period.
• Two (2) street outreach officers with City Net; and
• Five (5) bed nights with Project Touch.
Key Considerations
The proposed funding adjustments are dependent on the availability of existing ERF and anticipated HHAP funds, both of which are time-limited and subject to state and county eligibility requirements. Ongoing coordination with regional partners and service providers will be necessary to ensure program activities remain aligned with grant objectives, compliance standards, and expenditure timelines. In addition, anticipated HHAP funding is contingent upon formal regional cooperation, and discussions are ongoing to finalize the structure and agreements related to the Regional Housing Authority (RHA).
Pros/Cons
Pros
• Cost Savings for City Budget
Using ERF and anticipated HHAP funds to cover outreach and case management positions reduces reliance on the City’s operating budget while creating a regional collaboration.
• Enhanced Outreach and Engagement
Funding a two (2)member City Net street outreach team ensures continued engagement with individuals experiencing homelessness in Murrieta and Wildomar without service reduction.
• Immediate Shelter Access
Allocating ERF funds for two to five (2-5) emergency shelter beds provides rapid stabilization opportunities for individuals with higher service needs.
• Improved Service Coordination
Shelter-based case managers funded through anticipated HHAP will enhance regional housing navigation and support transitions into permanent housing.
• Alignment with City Goals
Supports the City Council’s goal to deliver responsive and effective community services.
Cons
• Temporary Nature of Funding and Dependence on External Funding
Reliance on ERF and HHAP funds introduces risk if future allocations are reduced or delayed. Currently, ERF expires in June 2027, and HHAP funding is an annual funding process subject to available funding.
Alternatives
1. Fund Services Exclusively Through City Operating Budget
• Outcome:
Maintain current service levels by reallocating City financial resources to cover outreach, case management, and emergency shelter beds.
• Risks/Limitations:
o Significant strain on City financial resources, potentially requiring cuts to other programs.
o Limits flexibility for future homelessness initiatives.
o Does not capitalize on available state and county funding streams.
2. Reduce Scope of Services
• Outcome:
Scale back outreach and shelter services to fit within existing City budget allocations.
• Risks/Limitations:
o Fewer outreach staff and limited shelter access could lead to increased encampments and public safety concerns.
o Slower progress toward housing placements and stabilization for individuals experiencing homelessness.
3. Seek Alternative Funding Sources
• Outcome:
Pursue grants or partnerships outside ERF and HHAP allocations.
• Risks/Limitations:
o Uncertainty in timing and availability of alternative funding.
o Potential gaps in service delivery while awaiting new funding sources.
o Additional administrative burden to identify and secure new funding streams.
FISCAL IMPACT
The financial obligations with the agreement with Project T.O.U.C.H. for Emergency Shelter Services from January 2026 through June 2026 is $252,480. For the same period, the financial obligations with the agreement with City Net for Homeless Street Outreach and Case Management Services is $303,072. The total fiscal impact is $555,552.
City Council approval for this agenda report’s recommendation will result in the following actions:
• Authorize the use of existing Encampment Resolution Funding to support a two (2) member City Net street outreach team serving the Cities of Murrieta and Wildomar;
• Authorize the use of existing Encampment Resolution Funding to fund a limited number of emergency shelter beds at the Murrieta Emergency Shelter operated by Project Touch;
• Authorize the use of existing Encampment Resolution Funding of approximately $109,252 budgeted in account 3580050-60480 50174358-60480; and
• Amend the Fiscal Year (FY) 2025/26 Operating Budget to establish an appropriation of $446,300 using General Fund Unassigned Fund Balance for the Homeless Services contracts in account 1105100-60480.
ATTACHMENTS
None.