The city will not renew its contract with Urban Alchemy to manage two key downtown homeless shelters following the discovery of improper data handling by the nonprofit’s staff. The Homeless Strategy Office confirmed the contract will end on Sept. 30 and that another service provider, Endeavors, will assume operations under an emergency contract.
According to a memo dated Sept. 15, the decision was made after Urban Alchemy staff were found to have “improperly, and without permission, misrepresented Homeless Management Information System (HMIS) exit dates and records.” Although the data was later corrected, the city characterized the breach as serious enough to warrant an immediate end to the relationship.
Urban Alchemy has managed the Austin Resource Center for the Homeless (ARCH) since 2022, and took over management of the Eighth Street Women’s Shelter when the city purchased the shelter from the Salvation Army.
“Ending this contract reflects HSO’s commitment to upholding the integrity of its operations,” the memo states. “This commitment guides every decision, ensuring that respect, compassion, and support remain at the core of all programs.”
Endeavors, a veteran homeless services provider that currently manages the Marshalling Yard and Northbridge shelters, was selected for the interim role due to its ability to quickly ramp up staffing and familiarity with city contracting procedures. The emergency contract is expected to run through September 2026, pending City Council approval on Oct. 9.
Urban Alchemy took over operations at ARCH after the city ended its long-standing contract with local nonprofit Front Steps. Although some City Council members expressed concerns at the time about Urban Alchemy’s limited experience with congregate shelters, the organization received early praise from community stakeholders.
A December 2022 report from the Downtown Austin Alliance cited a “remarkable transformation” under the new management, including cleaner facilities, improved staff presence, and an increase in the number of people being served. Advocates credited Urban Alchemy with reestablishing a sense of safety and order around the ARCH, a facility that had become a focal point in Austin’s homelessness response.
The recent data issues, however, have raised concerns about internal oversight and long-term accountability.
Via mail, an Urban Alchemy spokesperson acknowledged that members of its staff misreported HMIS data without authorization but said the issue was self-identified through internal controls. The organization alerted the city and terminated the employees involved.
“We hold our entire team to the highest possible standards, and will never hesitate to take appropriate action when we fall short of those standards. We will review any misreported HMIS records and submit them for the next quarterly progress report to the City of Austin,” the organization responded in part.
“We are grateful for our years of partnership with the City of Austin and to the community and guests we served and impacted. We gave thousands of guests a Four Seasons like experience, helped thousands make more positive choices for their lives, and launched our innovative Oasis model to give vulnerable populations a place to belong and build a cleaner, safer, and more resilient community.”
Matthew Mollica, executive director of the Ending Community Homelessness Coalition (ECHO), said in an interview with the Austin Monitor that the discrepancies were flagged through standard data-monitoring protocols within the region’s HMIS platform.
“We have protocols in place to help identify potential issues like the ones that came up at the shelters,” Mollica said. “I’m not going to speak specifically to this situation, but the protocols that were in place did their jobs and we were able to figure out what was going on as a system. HSO did what they thought was best when they had that information.”
Mollica emphasized that ECHO does not make funding decisions or direct city policy, but works to ensure “the system has integrity” and data is trustworthy and accessible.
When asked whether this represented a one-strike violation or the culmination of multiple problems, Mollica deferred to the city, saying, “Clearly, they felt like it was an egregious situation that called for immediate action.”
Mollica said Endeavors was likely chosen, in part, because it is already a city vendor and has experience managing emergency shelter operations.
The emergency contract will cover operations through September 2026. After that, the city intends to issue a competitive solicitation to identify a long-term shelter operator.
Mollica noted that future plans could be influenced by the outcome of Proposition Q, the tax rate election ballot measure going before voters this fall that would impact funding for housing and homelessness services. City officials said they do not anticipate service disruptions during the transition and are working to ensure that shelter residents continue receiving support.
“A sudden, major change in shelter operations is no small task, but I trust our City’s Homeless Strategy Office to manage this transition with care, urgency, and accountability,” Mayor Pro Tem Vanessa Fuentes said via text. “I’m grateful for the City’s quick response. Our top priority now is ensuring there is no disruption in these life-saving services, and that people experiencing homelessness continue receiving the care, stability, and dignity they deserve.”
Also via text, Council Member Ryan Alter said the mishandling of HMIS data could have undermined the credibility of the city’s progress reports reflecting the state of homelessness throughout the area.
“I am deeply disappointed by reports of possible misrepresentation of HMIS data at the ARCH and the Eighth Street Shelter,” he said. “Our community deserves honesty and transparency, and we cannot allow inaccurate reporting to undermine the trust of taxpayers or harm the very people these programs are meant to serve. We must have full accountability, and I am confident the City will strengthen the safeguards necessary to ensure accuracy and integrity going forward.”
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