Kansas City Housing Committee calls for details on $4.7M in homeless hotel spending

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KANSAS CITY, Mo. — In a meeting Wednesday, city council members on the Housing Committee questioned Lotus Care House about where the money for hotels housing the homeless has been going.

The mayor announced a plan to move people from homeless encampments to hotels back in early April without details for funding. The plan has received criticism for a lack of long-term sustainability.

“You guys, the city manager, the mayor is using the sympathy of people who care about people who are vulnerable, knowing they’re not getting anything long-term or valuable here,” Councilman Brandon Ellington said in the meeting. “What I smell is a bad hustle.” 

Lotus Care House is a newly formed nonprofit that took over the hotel project. Mark Patel, long time hotel owner, oversees Lotus Hospitality. Patel partnered with Alfredo Palacal to serve as executive director. One of Patel’s hotels is being used as housing.

“Although the agency is new, the staff that’s coming on board has worked in this space and collaborated with many agencies and understand the systems to really get people off the streets and into permanent housing,” Palacal said. 

Palacal said there are 12 hotels, mostly near the airport, currently being used to house 420 people. He said 40 people have landed jobs. At the meeting, some people said the hotels have provided security. 

“I believe that they’re not trying to hustle or nothing of that,” Troy Robertson said. “I believe these people are really trying to help us by being there and stepping up to the plate.” 

The city started moving people to hotels managed by Locust in late April, but some hotel owners that were a part of the original deal said they still haven’t been paid.

Hiral Bhakta owns the Econo Lodge in North Kansas City. He said at one time his entire hotel was used as housing. 

“Seems like my emails and invoices go unanswered. I’m not sure if the city is responsible for paying me or if Lotus is responsible or both,” Bhakta said. “Right now, I’m just waiting patiently on the sideline trying to keep my business afloat.” 

Lotus Care House estimates the full 90 days could cost the city $4.7 million. 

“The $5 million is sort of the worst case scenario if projected damages and security issues continue, if we max out the number of rooms, but we’re going to never get there at this point,” City Manager Brian Platt said.

The Housing Committee asked Lotus for a detailed breakdown of where the money has been going before agreeing to give $1.8 million in funding. 

“If the people in need get some assistance from it, then it’s probably money well spent,” Councilman Dan Fowler said. “But if on the other hand, people are just taking the money and we’re not getting help to people in need then it’s a real problem.”

The city is also planning to build a tiny home village to house homeless individuals.

Officials announced Merging KC would head up this project to provide temporary housing to people in need. In Wednesday’s meeting, plans for a bigger village were discussed.  

“They’ve asked that we could do a larger scale project, basically ramp it up,” said Houston DeFoe, president of Merging KC. “They’re talking about 200 beds instead of only 140, and we were able to design that and get that going fairly quickly.” 

The city did not go into details about the cost of each tiny home, but the hope is to provide a place with social workers, health care, laundry, employment resources and more on site.

City leaders have said it will cost significantly less than the hotels. Now the focus is where the village will be. 

“It took a lot longer than we thought it would at first,” Platt said. “Once we get them on site, it’s an hour to build each home, so we’ve treaded carefully to make sure we’re providing the best service that we can when we build these in a final location.” 

Some hope the city will figure it out before the hotel deal is over in the next month. 

“The summertime actually has more homeless people that suffer from medical events and it’s tougher for them,” a speaker at the meeting said. “So a new emergency is about to emerge it’s already so hot in June.” 

The Housing Committee will meet again next week. 

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