Last week, the city of Portland informed longtime shelter operator Sunstone Way that it would not be awarded a contract to continue managing one of the city’s tiny pod villages located in Southwest Portland.
Leaders of Sunstone Way expressed surprise at this announcement, given that the nonprofit has been operating the tiny pod village in Multnomah Village—along with two other villages—since 2022 without needing to reapply for the contract.
The contract in question had been established with Multnomah County, not the city, complicating the transition further.
An email sent by a city employee on April 4 indicated that the city was in negotiations with Urban Alchemy to take over management of the site.
This site saw an expansion from 28 pods to 100 pods last fall, making it a critical component of the city’s shelter system.
San Francisco-based Urban Alchemy was designated as the city’s preferred shelter operator in 2023 after signing a five-year, $50 million contract to manage its larger pod villages, termed temporary alternative shelter sites, or TASS.
The move to contract with Urban Alchemy has left some local nonprofits, which have traditionally managed homeless shelters under contracts with Multnomah County, feeling dismayed.
In the days following the announcement, it became evident that the shift in providers reflects deeper tensions between city and county leaders.
A long-anticipated transfer of oversight for safe rest villages and TASS from the city to the county, initially planned for July 1, 2025, has now been paused indefinitely.
This situation illustrates the city’s determination to scale up its shelter system rapidly, regardless of the county’s involvement, while relying on a single provider for larger-scale shelters.
As both entities navigate fiscal challenges, there are two key unanswered questions that will shape the upcoming fiscal year.
WHO’S RESPONSIBLE FOR FUNDING THE CITY’S POD VILLAGES?
In February, Willamette Week (WW) reported that a legal disagreement had surfaced between the city and the county over which government bears financial responsibility for the city’s safe rest villages and TASS.
This includes approximately 750 tiny pods and RV pads, which provide temporary homes for one or two individuals who were previously homeless.
The timing of this legal dispute is precarious; the city is facing a substantial $65 million shortfall in its general fund, while the county is dealing with a $104 million deficit in homeless services funding.
The city asserts that according to their interagency agreement to manage homelessness, the county is legally accountable for funding the shelters as of July 1, 2025.
However, the county has pushed back against this assertion, leading to continued uncertainty in funding responsibilities.
Despite this unresolved financial query, the problem may not have immediate consequences this year, as the city claims to have secured sufficient funding from the state, its budget, and $10 million from the county to sustain operations for now.
Nonetheless, it is crucial for both governments to find clarity on this issue for future budget cycles.
WHICH GOVERNMENT SHOULD OVERSEE THE SHELTERS?
Another significant, unresolved question involves the oversight of operations at the safe rest villages and TASS.
As it stands, the city of Portland engages directly with Urban Alchemy to operate three TASS sites, which are larger than the villages, while the county has local nonprofits manage safe rest villages.
Interestingly, when Sunstone’s village expanded from 28 to 100 pods last year, the city reclassified it as a TASS.
Looking ahead, the city has issued requests for proposals (RFPs) in February aimed at operating all safe rest villages and additional overnight and day shelters, many of which are still in the planning stages.
Mayor Keith Wilson has proposed constructing an additional 1,250 nighttime shelter beds within the next year and is currently seeking $28 million from various sources, including the state and Metro, to bring this vision to fruition.
These developments suggest a desire on the city’s part to take direct operational control of all pod villages, expanding beyond TASS.
The last intergovernmental agreement regarding the Joint Office of Homeless Services was established last year, with both parties agreeing to transfer all tiny pod sites and TASS to the county by January 1, 2025.
However, more recently, Mayor Wilson and County Chair Jessica Vega Pederson agreed to indefinitely delay this transfer after discussions this spring, in light of both governments negotiating budgets and responsibilities.
“Our priority is maintaining maximum capacity, expanding that capacity, and relying on proven strategies that have worked in Portland and other peer cities,” Wilson stated.
“This mutual agreement to delay the transfer is aimed at focusing on this critical goal.”
image source from：https://www.wweek.com/news/2025/04/16/new-tensions-lie-beneath-the-citys-tiny-pod-shelters/
