Citing significant financial management and oversight concerns identified in an independent forensic evaluation, Seattle and King County announced Wednesday that they will begin transferring responsibility for most homelessness service contracts from the King County Regional Homelessness Authority (KCRHA) back to the Seattle Human Services Department and King County’s Department of Community and Human Services while restructuring the regional agency’s role in the homelessness response system.
Mayor Katie Wilson and King County Executive Girmay Zahilay said the changes are designed to strengthen financial accountability, improve oversight and preserve critical homelessness services while allowing KCRHA to focus on its core regional responsibilities. The transition is expected to begin in January 2027 and will occur in phases to minimize disruptions for service providers and people experiencing homelessness.
The announcement follows an independent forensic evaluation released in April that found years of financial management, accounting and governance weaknesses at KCRHA, including recurring negative cash balances, unreliable financial reporting and weak internal controls. While the evaluation found no evidence of large-scale fraud, it concluded that the agency’s financial systems created an elevated risk of fraud, waste and abuse and recommended significant improvements to strengthen oversight.
“KCRHA was created because homelessness is a regional challenge, and I continue to believe a regional response is the right approach,” Zahilay said. “But believing in a regional response also means making sure it works. After years of leadership turnover, multiple audits, and an independent forensic evaluation, it became clear that changes were needed.”
The restructuring plan is built around three phases: strengthening KCRHA’s financial oversight, narrowing the agency’s responsibilities to its core regional functions and launching a broader effort to evaluate the future of the region’s homelessness response system.
As part of the first phase, Seattle and King County will jointly embed an independent financial monitoring firm within KCRHA through the end of the year. The firm will work alongside agency leadership to strengthen financial controls, improve invoicing practices and help ensure homelessness service providers receive timely payments.
“We’re taking decisive action to address KCRHA’s challenges while maintaining the continuity of the critical services they administer,” Wilson said. “The steps we’re taking today will let the agency focus on rebuilding public trust, making a strong application for federal funding, and helping our city and region deliver better outcomes for people experiencing homelessness.”
KCRHA currently oversees approximately $200 million in local, state and federal funding for homelessness services. Under the new plan, responsibility for administering most city- and
county-funded homelessness service contracts will gradually transition back to Seattle’s Human Services Department and King County’s Department of Community and Human Services.
Rather than managing those contracts, KCRHA will focus on regional coordination as King County’s Continuum of Care lead agency. Its responsibilities will include coordinating applications for federal Department of Housing and Urban Development funding, overseeing the Coordinated Entry System, maintaining the region’s Homelessness Management Information System, conducting the annual Point-in-Time Count and coordinating severe weather response efforts.
Officials said narrowing the agency’s responsibilities will reduce its administrative burden while preserving its ability to compete for millions of dollars in federal homelessness funding that supports programs throughout the region.
Plans outlining how service contracts will transition back to the City and County are expected to be submitted to the Seattle City Council and King County Council by Aug. 1. Contract administration responsibilities are scheduled to begin transferring in January 2027, with officials pledging to work closely with service providers to ensure continuity of services throughout the transition.
KCRHA Chief Executive Officer Dr. Kelly Kinnison said the agency’s mission remains unchanged even as its responsibilities evolve.
“KCRHA’s role is transitioning, but the need for a regional homelessness response has not changed,” Kinnison said. “As we move into this next phase, our commitment is to work with Seattle, King County, providers, federal partners, people with lived experience, and communities across the region to protect continuity, maintain essential infrastructure, and build a clearer, more accountable regional backbone.”
Seattle Human Services Department Director Tanya Kim said supporting providers throughout the transition will be a top priority.
“Seattle’s homelessness service providers are essential partners in helping people move toward safety, stability, and housing,” Kim said. “As contract administration transitions back to the Human Services Department, our focus will be on maintaining service continuity, and supporting timely and clear communication with providers.”
The proposal also received support from Seattle City Councilmembers Alexis Mercedes Rinck and Dionne Foster and King County Councilmembers Steffanie Fain and Jorge L. Barón, who serve on KCRHA’s Governing Board. In a joint statement, they said the restructuring will strengthen accountability while preserving regional coordination and minimizing disruption for homelessness service providers.
As part of the final phase of the plan, Seattle and King County will launch a series of Regional Reset Conversations with local governments, service providers, businesses, labor organizations,
philanthropic partners and people with lived experience to help shape the future of the region’s homelessness response. Recommendations from those discussions are expected during the first quarter of 2027.
