How to Start a Homeless Shelter: A Step-by-Step Guide to Launching a Sustainable Program

According to the 2024 Annual Homelessness Assessment Report (AHAR), a report submitted to the U.S. Congress each year by the U.S. Department of Housing and Urban Development, the number of individuals who experienced homelessness in a single night in 2024 was 771,480 -- the highest level ever recorded in the U.S.

This statistic gets even more concerning when it's broken down. The same report reveals the number of those experiencing homelessness increased by 18 percent between 2023 and 2024. Most of this increase included children under the age of 18, with 39 percent more families with children having to deal with homelessness. Meanwhile, a disturbing one in five of those who experienced homelessness at least one night in 2024 were 55 or older.  

Much of this homelessness crisis has been linked to a lack of affordable housing as stagnating wages for lower and middle income households prevent them from paying for current housing or finding other options. This, along with the end of pandemic-era rental assistance programs as well as other homelessness prevention programs makes it even harder for individuals and families to afford stable housing.

Additional reports indicate the problem could grow even more serious, as HUD employees are reporting that over half of the 2026 funding for the HUD programs designated for permanent housing projects will be cut by the Trump administration and shifted to transitional housing assistance. These funding cuts could put over 170,000 individuals at risk for homelessness.

All this shows the rising need for shelters in many communities. Homeless shelters provide access to basic necessities like food, clothes, showers, and basic hygiene products, allowing the homeless population to function even in trying circumstances. In addition, shelters can connect others with support services like job training, case management, and housing navigation to help get individuals out of homelessness. During extreme weather circumstances like storms, heat waves, or blizzards, shelters can provide a safe place for those who do not have any protection from the elements. This can extend to other public health issues, like diseases and street violence.

Beyond the benefits to the homeless population, shelters offer a chance for local organizations and individual volunteers to work together, build a more engaged community, and help solve a major social issue. This ultimately benefits everyone, as people with access to housing will not need to use as many costly emergency services and can better contribute to the community.

However, the legal and technical challenges of building both large and small community shelters that can provide effective housing insecurity solutions can be considerable. In this article, we'll look at how to build a homeless shelter by first understanding your community's needs, developing a clear mission statement, securing a space, and creating the type of programs your community will benefit from the most. We'll also address how you can meet the legal requirements of opening a homeless shelter and secure funding to keep your programs sustainable. And we'll look into how to measure the impact a homeless shelter is making in its community to support long-term success.

Understanding Homeless Shelters and Their Role

When defining what a homeless shelter is, it's important to emphasize that shelters provide temporary housing and support for families and individuals experiencing homelessness. Shelters are equipped with food, sleeping areas, and hygiene facilities for people requiring basic necessities. Many shelters also offer support programs or can connect people with services such as mental health and substance use counseling and case management to help find more permanent housing.

Different shelters can provide different types of safe spaces. Emergency shelters, for instance, provide short-term support for those who need immediate places to sleep overnight. Day shelters can provide services during the day, but not beds. Transitional housing models can provide stable living environments for people making the transition to more permanent housing, but often cannot support individuals for more than 6 to 24 months.

Outside of homeless shelters, permanent supportive housing (PSH) offers people both long-term affordable housing and services for people experiencing chronic homelessness and disabilities. PSH is not considered a homeless shelter (as they provide permanent housing solutions) but they do offer a long-term solution for ending homelessness.

It's important to consider these different types of shelters before launching your own homeless shelter. Each solution comes with its own legal and practical considerations, and you'll need to assess the type of resources, support, and funding you'll require before you can provide such services within your own community.    

Assessing Community Needs Before You Start

Before deciding what type of homeless shelter you want to start, take a look at the needs of your community. Many shelters work with a specific population, such as families or veterans. Some may even support domestic violence victims or young adults. Or you might look at the chronically homeless in your area and see if there's a way to address their problems.

Look at the size of this target population in your community. See what type of services are already being provided to them and identify any service gaps. Are the people you want to help receiving adequate medical or dental care? Is there a shortage of substance abuse treatment services? These could be needs your shelter could fill.

Get a more detailed understanding of the national and local housing crisis. Review reports provided by the Department of Housing and Urban Development to identify nationwide trends about how the homeless are using shelters. The Homeless Management Information System (HMIS) is an electronic database where service providers can enter client-level data on individuals and families experiencing homelessness. You can reference it to determine the demographics of the homeless population you want to serve. This can give you a better understanding of the issues you'll face and the resources you'll need to manage them. 

The National Alliance to End Homelessness (NAEH) is another valuable resource. This nonprofit, non-partisan organization works to prevent and end homelessness in the United States. They can supply organizations with extensive research on the state of homelessness and how it affects different populations (including families and veterans), along with actionable insights for how service providers can address homelessness. In addition, the NAEH provides toolkits, training resources, and webinars on evidence-based practices for emergency shelters, rapid re-housing programs, and other services.

Talk to other shelter providers in your area to get their take on the homeless situation in your community and what areas they feel are underserved. Spend time connecting with the homeless in your area, as well as individuals and families who have experienced homelessness in the past to learn what issues contributed to their situation. This can help you identify community needs that your own homeless shelter can help fill. 

Speaking with healthcare providers and law enforcement can provide you with additional insights into how homelessness impacts everyone in the community. This can all be valuable information to help make your case when you approach philanthropists and government agencies to ask for help funding your initiative. 

Legal Requirements and Zoning for a Homeless Shelter

Establishing your homeless shelter means navigating multiple legal hurdles. These include everything from the legal structure of the shelter itself to zoning regulations to permits to safety codes.

While some homeless shelters are run by government agencies, the vast majority establish themselves as nonprofits. The legal structure of a nonprofit allows shelters to be tax-exempt and access certain local, state, and federal government grants to fund its programs. In addition, you can apply for foundation grants and collect individual donations through fundraisers. Some homeless shelters can even partner with government agencies to access public funding and provide government-mandated services like emergency services and rapid rehousing.

Invest time researching the zoning regulations and local laws concerning homeless shelters in your area. Many communities prohibit shelters in residential zones, requiring you to find space in commercial or industrial areas. Certain codes also have spacing requirements between shelters (to prevent too many shelters from clustering in one area), which can affect where you can establish your shelter.

The size of your shelter can be another issue. Capacity limit codes can limit the number of individuals you can house in your homeless shelter, which can be an issue if your shelter is a small "pocket" shelter. You'll also have to follow specific operating rules, including your staff size and any security measures. Some zoning codes may keep you from offering certain services like mental health or substance abuse rehabilitation programs, so make sure you know the laws concerning these resources if you want to offer these type of solutions.

If your area is not zoned for a homeless shelter, then you can apply for a "conditional-use permit." This permit provides a zoning exception for a shelter to operate without a full rezoning of the property. That said, the process to approve a conditional-use permit can be long and requires a public hearing, during which community members can voice concerns with public safety, noise, or traffic. Even if the permit is approved, local officials can place certain restrictions on the operation of your shelter, including limitations on operating hours or signage, noise and lighting controls, requirements for off-street parking, and more.

Beyond the conditional-use permit, a shelter will need a state, county, or local business license to legally operate. If you're establishing yourself as a nonprofit, you'll need to formally register with the IRS and get an Employer Identification Number (EIN). Different states, cities, and communities may have other legal requirements, so be sure to do your due dilligence and research the laws in your area. 

Then there are the health and safety permits. The local health department will need to conduct regular sanitation and food service inspections on your property and issue approval. You'll also need to comply with all fire and safety standards and be prepared for regular inspections on how well your shelter is ready for emergencies.

Securing the services of a lawyer and/or accountant who specializes in your state's nonprofit law can be a big help in navigating all these legal hurdles. Many state and federal guidelines need to be followed if you want to build a sustainable homeless shelter, so be sure to build a good legal foundation for your organization. 

Creating a Sustainable Business with Government Grants and Other Funding

How much does it cost to build -- and sustain -- a viable homeless shelter? To answer this question, you'll have to estimate both your startup and ongoing costs to keep your shelter sustainable beyond the initial launch. And you'll need to identify multiple funding streams, including government grants, philanthropic endowments, and donations, that can provide you with adequate (and ongoing) support.

When estimating your startup costs, you'll want to take a close look at the following:

Rent

Rent costs for your shelter depend on your capacity and service needs. Work out the number of homeless individuals your shelter will serve and how much space you'll need for each one (one rule of thumb is to plan for 250 square feet per person (the same measure used for office space).You'll also need to factor in space for onsite services like case management, food services, storage areas, and medical clinics.

To see how this space will translate into rent costs, look at public market reports that list the average commercial lease rates for business properties in your target location. You'll also want to look at the lease options available to you (Full Service Gross, Triple Net, Modified Gross etc.) to learn what your base rent will include (utilities? maintenance?) and if there are any hidden costs like property taxes. 

Renovations

Is your property ready to provide homeless services or does it require renovation? Conduct a thorough inspection of the space and create a detailed list of the type of changes you'll need to make to the building. These may include structural upgrades, electricity/plumbing work, wider doorways for handicapped residents etc. You may also need to construct additional spaces for medical and counseling services, as well as adequate office space. 

Costs for your renovations will include materials, professional services (architects and contractors), as well as labor costs. Then there are the "soft" costs like workers compensation insurance and special permits. As always, plan to pay more for unexpected issues like overruns, and get multiple quotes from qualified contractors to see which ones fit within your budget.

Utilities 

Utilities include costs for electricity, gas, water, sewage, trash, phone, and internet services. These costs are often tied to your property's square footage and location, so you'll want to research historical costs (contact the last owner of your property if possible) and average utilities in your area. Request quotes from local providers if you have any options for which service provider you choose to get your utilities from.

Another important factor to consider are seasonal variations. Heating and cooling costs vary greatly in the summer and winter, depending on where you're located, and can be a huge issue since you're providing shelter for individuals who need to get out of extreme weather. Create estimates for all your utility costs and map them out on a spreadsheet so the information is easily accessible when you need it for planning out budgets or applying for grants. 

Furniture

Look at the services your shelter will offer and assess the type of furnishings you'll need. Homeless shelters that provide sleeping accommodations will need cots, bunk beds, mattresses, pillows, linens, and storage units. Shelters that offer food services must have dining tables and chairs, food storage units, and commercial-grade kitchen equipment. Restrooms need towels, cleaning supplies, and possibly washers and dryers if you want to help with clothing needs. You'll also need desks, chairs, filing cabinets, and supplies for your office areas -- and adequate seating, television sets, and bookshelves for your common areas.

When calculating furniture costs, consider cost-savings options like buying in bulk or accepting donations. Request quotes from commercial suppliers and create detailed breakdowns of each type of furnishing, including the estimated quantity, unit cost, and total cost. Keep in mind that costs can vary depending on the quality of your furniture, price hikes, and any special needs, so add a contingency fund for any changes.

Legal fees

Legal startup costs for a homeless shelter cover a wide range of expenses, including state incorporation (if you intend to function as a nonprofit), filing for federal tax-exempt status 501(c)(3), and any business licenses and permits associated with food handling or fire safety. Charitable solicitation registration is also required for institutions that ask for donations. 

You may need to hire a lawyer to help draft bylaws and articles, or make sure your filings are compliant with all pertinent laws. This is particularly important for homeless shelters since you need to comply with building and fire codes, zoning regulations, and health department regulations, which are difficult to navigate without legal assistance.

Insurance

Property and liability insurance are both necessary startup costs (which become ongoing costs). You'll also want to add-on abuse or molestation coverage to provide financial and legal protection for your shelter against claims of sexual misconduct or physical abuse by your staff, volunteers, or representatives. If you use vehicles in service of your organization, commercial auto insurance is also required.

Marketing

You'll need to plan a promotional campaign once you begin offering shelter services. This can incur certain costs, including website development, social media management, and printing brochures and fliers. It's also important to create an easily-identifiable branding logo to associate with your shelter, so hiring a professional designer could be a smart move.

After startup costs, you'll also need to consider your ongoing costs, such as:

Food

While shelters can get their food supplies from donations, partnerships with food banks, and government programs, many homeless shelters still need to purchase supplementary meat, milk, fruits, and vegetables to meet their needs and accommodate for dietary restrictions. In addition, you'll need to factor in the cost for disposable containers, napkins, utensils, and kitchen supplies.

Be sure to also calculate how much your utility costs (electricity, gas, water) go into refrigerating, cooking, or cleaning your food. You should also keep records of how much fuel you're using for vehicles to pickup and drop off food deliveries.  

Staff services

Your homeless shelter's paid staff can include a shelter manager, case managers, security personnel, administrative support, and shelter aides. If you're planning on offering specialized services for unique populations like veterans, families, or individuals with mental illness, you'll also need to hire service staff with specialized training and experience.

Staff costs vary depending on local salaries and the cost of living in your area. Research industry reports and job postings in your area to see what salaries are considered competitive for each position. You'll also need to budget for employee benefits (health insurance, retirement contributions, workmen's compensation etc.).

There are also hiring expenses related to staff costs. For instance, you'll need to conduct thorough background checks on each applicant and budget for staff training and development. As stated previously, you'll also need to purchase adequate liability insurance to cover your staff for any legal expenses related to misconduct, negligence, or professional errors.

Maintenance

Keeping your homeless shelter in good condition is necessary to provide sustainable services. Beyond utility and food costs, you'll need to pay for regular inspections and repairs. Lawn maintenance, snow removal, and salting all serve to keep your property safe and accessible throughout the year. And of course you'll need to budget for cleaning and sanitation supplies for laundry, waste removal, and general cleaning.

Establishing multiple funding streams

Once you've prepared budgets for your startup and ongoing operational costs, you'll need to identify multiple funding sources to keep your shelter sustainable. Many homeless shelters rely on grants and donations for their primary funding source. These can include federal grants from the Department of Housing and Urban Development, as well as state housing assistance programs. Depending on the type of services you offer, you may be able to petition other government agencies, like the Substance Abuse and Mental Health Services Administration (SAMHSA) for financial assistance.

But don't stop at government aid. Foundations and trusts can be sources of valuable financial aid, along with corporate sponsors. Shelters run by religious groups can also be supported by donations to that organization. Later, we'll get into how running fundraisers can provide you with regular community support and donations from both individuals and businesses. For now, be aware that diversifying your funding sources allows you to build financial reserves that can keep your shelter solvent for the long term. 

Creating a Clear Mission Statement and Policies

Establishing a clear directive for your shelter early on helps you design policies and an effective business structure with clear leadership that keeps everyone on the same page. Your staff, volunteers, and governing board should all understand your shelter's purpose, including its purpose in the community, the populations you're there to serve, and how your services and programs will help meet your goals. 

Be very clear about your shelter's purpose. What population(s) are you trying to help? What values are you promoting through your services and your staff actions? 

Mission statements appear on your website, Articles of Incorporation, and grant applications, so keep them short (15-20 words), emotive, and accurate. Write in the active voice to show the impact of your work and motivate those reading it to support your mission. As your organization evolves, your purpose can change, so review your statement periodically and update it to reflect any new developments (for instance, if you can now service more individuals than you could at the beginning, this should be highlighted).

Your statement will influence your shelter policies, letting you know which goals and initiatives to prioritize. For example, if your primary goal is to move families and individuals into permanent housing, much of your resources will need to be put into partnerships with housing agencies and case management. This differs from shelters that focus on improving healthcare access and prioritize securing funding for on-site medical staff and equipment.

Establish a governing board and trained staff to help implement your initiatives. You'll likely need:

• An executive director or coordinator
• Program managers
• Volunteer coordinator
• Administrative support

Assign leadership roles carefully and be very clear about every member's responsibilities. Vet applicants to make sure you recruit only qualified staff and volunteers who share your organization's values. To make sure you're fulfilling your mission statement's goals and policies, establish measurable benchmarks for success, such as the number of individuals your shelter got into permanent housing or the number of individuals your provided with necessary dental services in the year. 

Securing a Facility and Designing Shelter Spaces

Optimal shelter spaces need to be accessible to your target population and provide adequate bathrooms, kitchens, and rest areas for your services, which can include sleeping, meals, and healthcare. You'll also need to establish that the building is compliant with current building and health codes -- or that you have the time and resources to bring it up to code within an acceptable span of time.

Keep in mind that "accessibility" can mean many things for those who use your shelter. The building should be in a central location that people can easily get to, or located near transit services like buses. You'll also need to make the building accessible for everyone, including individuals in wheelchairs and those with visual or other physical challenges. 

People need to feel safe within your shelter, so include necessary security features such as fencing, emergency lighting, motion detectors, video surveillance, and electronic access control systems. You also need a functional fire alarms, sprinkler systems, and safety exits with clearly marked evacuation routes and safe zones.

Have procedural and operational security policies set in place to keep operations smooth and safe. This can mean including a guest registration process and bed availability record. You'll also want to screen sleeping areas for any prohibited items, especially weapons, drugs, alcohol, and hazardous materials. All staff (not just security) needs to be trained on how to de-escalate potentially dangerous situations and respond to various emergencies. As a further precaution, conduct regular security audits to locate any issues that impact your shelter's safety so you can address them immediately.

Developing Programs and Services for Residents

Homeless shelters can offer many other essential services beyond temporary housing. Depending on the needs you want to meet in your community, you might provide programs like job training, mental health support, and healthcare services. Creating structured programs that make a measurable impact in your community can be challenging, however, so you'll want to establish key performance indicators for your services and build partnerships with local service providers that can provide you with necessary resources for programs such as:

Case management

Many homeless shelters offer case management services that help people navigate issues common to the homeless population, including:

• Obtaining and retaining permanent housing
• Accessing financial benefits
• Creating short and long-term financial plans
• Connecting with mental health and substance abuse counseling

Given the often diverse needs of the homeless population, it's important to first assess the needs of your particular community before deciding which type(s) of case management services to provide. Use a trauma-informed care model to learn what happened to each client that put them in their situation and prioritize their emotional and physical safety. Gather as much information as you can on each client to supply case workers with the client's history, strengths, challenges, and goals to build a person-centered plan.

Building partnerships with local government agencies, housing authorities, employment providers, and healthcare and mental health providers allows you to link clients with useful resources and services, even if you can't directly provide such services yourself. While different shelters offer different services, it's a good idea to prioritize helping clients secure stable housing, as this can tackle the core issue of homelessness.

Health and counseling services

Health and counseling services can be one of the more important case management services provided by a homeless shelter. These services can address different problems depending on your community needs, and may include:

• On-site medical care where volunteer doctors and nurses provide basic medical care, such as wound care or health screenings
• Trauma counseling
• Substance abuse counseling
• Basic hygiene care

Partnering with community health centers and local health departments can give you access to public health resources and even dental care. Mobile medical providers like Circle the City can also bring healthcare services directly to your shelter.

Job readiness programs

Teaching the homeless population how to secure steady employment improves their financial resources and helps break the cycle of homelessness. Homeless shelters can offer job readiness programs like resume writing courses and workshops on job interviews. Some shelters can even provide vocational training programs that teach skills for specific work like carpentry or restaurant work, as well as "soft skills" like problem solving and teamwork.

Collaborations with local businesses can help place trained workers in paid positions and transitional employment. In addition, shelters can help remove certain barriers to gainful employment by helping clients secure necessary ID cards, professional clothing, and transportation to job sites.

Connecting to community services

The U.S. Interagency Council on Homelessness (USICH) is an organization meant "to coordinate the federal response to homelessness and to create a national partnership at every level of government and with the private sector to reduce and end  homelessness in the nation while maximizing the effectiveness of the federal government in contributing to the end of homelessness."

Homeless shelters can connect with USICH and find technical assistant documentation for partnering with health system organizations and hospitals as well as workforce systems. In addition, USICH advocates a "Housing First" approach, which prioritizes providing permanent shelter to the homeless to reduce their dependence on shelters.  

Raising Revenue with Fundraising Events and Community Partnerships

Providing sustainable programs and services for your community's homeless population requires ongoing financial support. You can secure stable funding by seeking out government assistance programs, building strong community partnerships and organizing fundraising events that attract supporters and donor engagement. 

The Department of Housing and Urban Development (HUD) provides funding for homeless shelters. These funds can be used for essential programs, delivering critical support services to get individuals out of homelessness, and improvements to your shelter space. Learn more by visiting the Homelessness Assistance Programs site and researching the Emergency Solutions Grants (ESG) Program and the Continuum of Care (CoC) Program.

When planning a successful fundraiser, keep the needs of your support network in mind. Offer activities that cater to their interests, such as concerts, fun runs, charity auctions, or luncheons. Review their donation history to get an idea of what type of financial support you can expect from them when you request a donation.

Be prepared to regularly expand your support network to secure new forms of financial and community support. Partner with businesses, religious institutions, and civic groups. These are potential sources of not only monetary aid but also organizations that can sponsor and help advertise your fundraisers to their own communities. Researching and reaching out to local philanthropists willing and capable of donating large sums of money to your programs is another good way to keep your shelters operational and effective.

Use digital strategies to reach out to potential online supporters. Crowdfunding, for instance, is a good way to request relatively small donations from individual donors that can add up to substantial (and ideally recurring) sources of funding. Likewise, social media is a good way to promote your fundraisers and your shelter's mission to your local community and larger audiences who may not be aware of your work. 

Build donor retention systems into your programs. When requesting online donations, provide donors with the option of giving a recurring donation where they can automatically give your shelter smaller amounts of money each month, providing you with more stable financial support. After each fundraiser, send thank you notes to all your donors and provide tangible proof of the difference their financial support is making in their community. If members of your support network show inactivity, reach out with an invitation to attend a fundraiser with activities that appeal to their interests.

Launching and Operating Your Homeless Shelter

After establishing your policies, securing a space for your shelter, and developing your programs, you'll want to set up some standard operating procedures that detail how to complete all routine tasks at your shelter. This can include everything from how to screen new arrivals or clean sleeping and common areas. Operating procedures also cover how to deal with emergencies like certain medical issues or dangerous situations like a severe weather event.

Having these standard operating procedures on hand helps train staff. You'll also have a system in place for volunteer onboarding. By having an established, consistent plan in place, staff and volunteers are less likely to encounter miscommunication issues and can offer their clients more consistent services.

One way to create better operating procedures and protocols is to launch pilot programs. For instance, after designing a job training program, you could offer this to a limited group of shelter residents and monitor their progress to assess the program's success. The real-world training could also help you refine your procedures as certain teaching methods will work better on some residents than others. You can also test out new outreach strategies or mobile health clinics.

Establishing clear reporting and safety protocols is also vital to offering a safe environment for both staff and guests. Staff and volunteers need to run safety drills for multiple emergency situations, including fires, intruders, and evacuations. Be prepared to work with agencies such as FEMA that can provide guidance and funding for your safety measures. Staff also needs to be instructed on a standardized way of reporting incidents. Creating a standardized form for listing the date, time, and location of the incident, as well as the people affected, the incident itself, and all actions taken can help secure critical details needed to address such incidents and to help prevent dangerous issues from re-occuring. 

Measuring Impact and Ensuring Long-Term Success

What does a successful homeless shelter look like? 

That depends on what type of long-term impact you're trying to make in your community. Many shelters measure their success by the number of former residents that have found housing stability through their services and managed to break the cycle of homelessness. Others also look at the number of individuals who have found employment through shelter programs or the average length of stay shelter residents experience (and if that time is sufficient to getting adequate support for their challenges).

Once you define what success looks like for your shelter, you'll need to develop metrics for measuring that success and track the data. For example, if one of your key performance indicators is increasing the percentage of clients who move into permanent housing, you'll need to look at the number of residents who exited your shelter into permanent housing and divide that by total number of people/households who exited your shelter within a given period of time (often 12 months).

You'll also want to look at other factors -- like the percentage of people who remained in their new housing situation for a specific period (6 months, 12 months) and how many returned to homelessness. Review the history of these clients to assess how at risk they were of returning to homelessness. Once you review all these metrics together, you'll have a clearer idea of how well your programs made a lasting impact on the community served.

Gather data from multiple sources, including feedback from the homeless residents themselves. Learn what programs they felt helped them the most and any shortcomings they saw in your services. This can help you assess and refine your programs to improve your success rates.

Once you gain a clear, measurable understanding of your shelter's success, you'll need to report these results to your funders and the general public. Be transparent about your goals and how well you met them. Highlight any changes you made to your programs and detail if they helped make a more positive effect on your target population. Being able to communicate the impact of your programs -- and where you still need to improve -- is a good way to show donors why your shelter provides an important community service and why they should continue funding your efforts. This information can also be used to attract volunteers and define the positive change they can make to their community. 

Success Stories and Case Studies

Successful shelters can display innovative strategies in fundraising, community engagement, and partnerships with outside organizations that improve their reach and ability to get people out of homelessness. Below are some notable case studies and success stories of homeless shelters.

Houston homeless shelters coordinate to reduce homelessness by nearly two-thirds

The Way Home is a collective effort to reduce homelessness in the Houston area. It partners with over 100 organizations, including many homeless shelters as well as local governments, public housing authorities, the local Veterans Affairs office, and other nonprofits and community stakeholders, to coordinate efforts and get homeless people into permanent housing.

When homeless families or individuals enter one of the partner homeless shelters, they can be connected with case managers who help navigate The Way Home's housing programs. They can show people how to complete a Coordinated Entry (CE) assessment that helps figure out what type of housing and services they are eligible for. Those who qualify can be put into permanent housing supportive programs where case management and supportive services (like case management, physical and mental health care, and substance abuse counselors) can help with income, employment, and health needs.

Others go into rapid re-housing programs where they receive short-to-medium-term help so they can afford housing more long-term. While the shelters themselves are not intended as a long-term solution, they play an important role by offering an entry point for homeless people seeking long-term housing.

By coordinating their efforts, The Way Home has helped reduce homelessness in the Houston area by 63% from 2011 and 2020. The effort has housed over 35,000 individuals and dismantled 127 street camps. Proponents attest this success is thanks to the way independent homeless shelters coordinate their efforts with other service providers instead of competing for funds and attempting to fulfill solo missions.  

Westhab helps families out of homelessness

Westhab is a nonprofit organization that focuses on providing homeless shelters and affordable housing to families living in Westchester County and parts of New York City. These families may be experiencing homelessness due to evictions, medical emergencies, chronic health issues, or other circumstances.

In addition to providing for family basic needs. Westhab offers many supportive services including case management, job training, and educational resources -- including youth development. To help connect families with community resources, Westhab partners with local organizations and government agencies including the U.S. Department of Housing and Urban Development and New York States Homes and Community Renewal.  

These resources attract many families to Westhab. In 2023, Westhab helped house 123 families in Westchester and 369 families in New York City. Since they began operating in 2016, Westhab has helped 11,931 households out of homelessness.

FAQ's

Let's delve into some of the more frequently asked questions about creating and operating a homeless shelter.

How much does it cost to start a homeless shelter?

Depending on the size of your shelter, its location, and the type of services you want to offer, a homeless shelter can cost anywhere from several thousand to well over a million dollars. Much of the initial cost comes from securing a facility (or building a new structure), funding renovations, and acquiring necessary furnishings such as beds, kitchen equipment, and hygiene products. While some smaller homeless shelters can reduce startup costs by relying on donated supplies and labor, it's generally advisable to calculate all your startup costs and secure funding before starting on your project.

Also keep in mind that shelters need to deal with ongoing costs, such as staff salaries, utility fees, food costs, and fees for special services such as medical or psychiatric care. These costs vary and are often measured by a per bed per month basis to measure how much it takes to house and care for each resident. Depending on your location and the type of services you offer, you could be looking at several thousand dollars per resident per month.

What business license requirements and federal and local government policies are needed to open a homeless shelter?

Homeless shelters that operate as nonprofits need to apply for 501(c)(3) federal tax-exempt status. This requires an IRS Form 1023 and an Employer Identification Number (EIN) required for nonprofits. A Certificate of Incorporation (or Articles of Incorporation) also establish your shelter as a nonprofit corporation that can help you apply for tax-exempt status as well as grants and financial support.

You'll also need state, county, and local business licenses to legally operate in your area along with all necessary building, occupancy, fire safety, and food handling permits. Make sure you have a zoning permit that shows your property is zoned correctly for use as a homeless shelter. And of course you'll need multiple insurance policies, including general liability, property insurance, workers compensation, commercial auto, volunteer coverage, and more to protect yourself from potential legal issues. 

How do I get funding?

Homeless shelters can get funding from local governments that receive grants from the U.S. Department of Housing and Urban Development (HUD). You can also partner with local companies and other businesses that offer sponsorships or grant money. Private philanthropic organizations like the Morgan Stanley Global Impact Funding Trust can also provide support through donor-advised funds.

However, you'll also want to form strong relationships with community members and organizations to get individual donations from the general public. Well-organized fundraisers can be a valuable source of funding for homeless shelters and community programs, particularly if you develop a strong support network willing and able to provide recurring donations.

What services should I offer?

The type of services you provide at your homeless shelter depends greatly on the needs of your community. While finding permanent housing and stopping the cycle of homelessness should be high priorities for any shelter, you should also look at the unique circumstances that brought members of your target population into homelessness and address these issues.

For instance, if a lack of vocational education prevents many community members from learning the job skills they need to secure stable employment, offering skills-based and general workforce readiness training in computer literacy, culinary arts, heavy equipment operation and more can be valuable services. You can also provide workshops for writing resumes and conducting job interviews.

Likewise, if substance abuse, domestic violence, and mental conditions affect many residents at your shelter, providing on-site counseling services can make your shelter a valuable community resource. If providing services on-site isn't possible, you can still connect people with local or online resources that can provide them with help.

Connect with your residents to see what services they need. Visit other homeless shelters in your area and talk with advocates to learn what type of programs the homeless in your community would benefit most from.

How do I find volunteers and staff?

You can post job openings on your website and job boards to let people know about open positions. Partnering with colleges and universities can also connect you with recent graduates who have the education and drive to work at your shelter.

Be very clear on the responsibilities and qualifications necessary for each position. Screen applicants carefully and conduct in-depth job interviews to assess soft skills such as communication and empathy.

You can post volunteer opportunities on social media or sites like Volunteer Match. Schools, churches, and local businesses can also be good places to request volunteers. If your shelter is run by your church or a nonprofit, this might be a good way to secure experienced volunteers.

Fundraisers can also be another good place to offer volunteer opportunities. Let donors know you're interested in getting volunteers to help with shelter and/or fundraiser duties and see if you can increase your manpower that way.

Creating Lasting Change Through Action

Building a homeless shelter with sustainable programs is challenging, yet the positive impact a shelter can make in your community is undeniable. Beyond simply providing safe places to sleep for vulnerable members of society, homeless shelters can help break the cycle of homelessness for many individuals and families -- by connecting them with permanent housing resources. Shelters can provide opportunities for learning valuable job skills and securing steady employment. Other shelters can provide on-site services for people in need of medical or dental services -- or even more specialized services like substance abuse counseling.

Of course, creating such a multi-level community resource takes some serious planning. Community leaders need to consider the best place to build a homeless shelter and need to work with local governments to make sure the shelter adheres to all zoning regulations. Many shelters function best as nonprofits, and shelter managers need to know how to apply for 501(c)(3) status and develop Articles of Incorporation. Then there are multiple permits and licenses that need to be obtained, from building permits to fire safety permits.

And as difficult as starting a homeless shelter is, keeping one in continuous operation comes with its own challenges. The nonprofit or group running the shelter needs to secure regular sources of funding -- often through a blend of grants, private endowments, and individual donations. Running successful fundraisers on a regular basis can often determine whether or not a shelter can continue providing its programs and services to the public. 

Nevertheless, by building the right partnerships and investing in the proper resources, homeless shelters can become institutions of positive change in the community. Organizations that know how to reach out and connect with local governments, businesses, and volunteer networks can secure the type of support needed for sustainable change. By encouraging collaboration and delegating tasks to those best suited to managing facility maintenance, case management, volunteer management, record-keeping, and fundraising, homeless shelters can provide long-term impact in the community.    

Investing in an online fundraising platform like PayBee provides the tools to better organize your fundraising efforts. Contact PayBee and schedule a free demo of our software tools to discover how we can help build, manage, and improve ongoing fundraising. See how online auctions produced through our platform help leverage the digital landscape to expand your donor pool. Improve your support network by connecting with our event planning partners. Our team of experts is ready to answer all of your questions, so sign up for a free demo and learn how PayBee can help sustain your charitable operations.