Assembly votes to keep Midtown Anchorage homeless shelter funded through October with operator under fire for leaked texts

The Anchorage Assembly voted Friday to extend a contract with nonprofit Henning, Inc. to continue operating a Midtown homeless shelter through the middle of October.

Members approved the measure 9 to 1 after hearing from Mayor Suzanne LaFrance’s administration that it was the best way to avert a gap in service that might force up to 200 people out onto the streets with nowhere else to sleep.

“We’re comfortable with this as an interim solution. We hope to have a more permanent solution to you by the middle of October,” said Bill Falsey, the chief administrator officer for the LaFrance administration.

Henning’s contract to run a low-barrier shelter inside the former Solid Waste Services building in Midtown for the municipality went into effect in October of 2023. Assembly members had already voted to extended the contract twice. The Friday vote pushing the deadline back to Oct. 15 will cost $1,033,600 on top of the $3.2 million already approved to keep people housed at the site.

Most of the money to keep the emergency shelter running is coming from a state grant for $4 million appropriated by the Legislature during its last session.

At Friday’s meeting, some Assembly members questioned the decision to continue paying Henning for services. The nonprofit came under intense scrutiny in May after screen shots of text messages were leaked to the Assembly purporting to show unprofessional and potentially unlawful conduct by the organization’s leadership. An investigation by the Anchorage Health Department into the messages is ongoing, according to Assembly Chair Christopher Constant.

“I am a bit uncomfortable,” said East Anchorage Assembly Member Karen Bronga, the lone no vote on the extension. “We had a big to-do about text messages that were shared at a meeting, there was gonna be an investigation, nothing’s been done and we’re going extend the contract to October 15th? That doesn’t feel right.”

Other members agreed with that perspective, but said given the technical requirements involved with keeping shelter operations consistently funded with public money, the most practical option was to stick with the status quo.

“There are some serious questions that we need to ask. And also, I do not want those things to be at the expense of people who suddenly have to leave where they have been sheltering,” said Anna Brawley, who represents West Anchorage.

“It’s a reality that there are very few people and organizations in this city that are willing and able to run shelter,” Brawley said.

Rather than elongating by just another month, the administration wanted more time to conduct a fuller process soliciting proposals from interested providers.

“We were concerned that we would be creating a problem for ourselves if we looked to a shorter extension where we would inevitably have a gap in service because we couldn’t complete that procurement in time,” Falsey said.

For its part, Henning has reservations of its own about its continuing partnership with the municipality.

“We had decided that we weren’t going to bid again,” said Shawn Hays, Henning’s founder and executive director.

The contract extension, Hays said, was requested by the Anchorage Health Department in order to buy more time selecting a long-term contractor for the site.

She said that the organization’s tenure running shelter operations and housing programs for the municipality has not been without turbulence over the last few years, but nevertheless has a demonstrable record of success taking care of people, connecting them with services, and getting them into long-term housing. But, Hays said, excessive criticism and scrutiny from Assembly members is one reason the nonprofit has been planning to pivot away from providing emergency shelter service and focus on transitional housing programs.

In a letter sent to Assembly members after their Friday vote, Hays wrote that Henning did not request the extension and had not planned to bid on the contract to run the Midtown shelter going forward. But, she wrote, the company is willing to keep running it through October.

“Continuing to operate the congregate shelter for several more months will require Henning to pivot its plans, but it is prepared to do so and will continue its current level of service. Henning will not abandon the 200 people using the congregate shelter and will continue to provide quality services until the contract expires,” Hays wrote.

The Midtown shelter is set to remain open to clients through the winter and into at least the middle of 2025, according to Constant.

“The plan is to keep it open so there’s a place for individuals to go,” he said.

Other companies have expressed interest in taking over for Henning running services there. However, Assembly members want a more comprehensive bidding process to be set up before selecting a contractor going forward, Constant said.