While the state has estimated that more than 44,000 new housing units will be needed by 2009, more than half of the homeless and affordable housing funding has been dedicated to increasing capacity in shelters instead.

"At IHS we see the limitations of building more and more shelters because what we find is there is nowhere for us to exit our folks to," Schrire said. "There is just not the rental housing inventory that we need to help these people transition into affordable housing."

RENTAL MATTERS

In addition to the homeless funding, lawmakers did provide other measures to address the rental market, including increasing the percentage of the conveyance tax going toward building affordable housing units and increasing financial assistance to low-income renters.

Some of the existing homeless service providers had expected that the administration's request for $20 million for renovations and increased services would be made available for competitive proposals after the legislative session.

They were surprised to discover in the last days of the session that a conference committee had increased homeless allocations to $30 million, but then awarded about half of it in grants to specific projects, many of which are new initiatives.

EXISTING SERVICES

Darlene Hein, who heads the Waikiki Health Center's Care-A-Van Program, said there are times when grants for new programs make sense, but proven results are important, too.

"We want to make sure there's competition and research, and that the best practices are followed," she said.

This year she would have liked to see more money dedicated to fixing and expanding existing services, which received about $15 million.

"I think that part of the issue for me is looking at what the needs are," she said.

Sen. Ron Menor, D-17th (Mililani, Waipi'o), chairman of the Consumer Protection and Housing Committee, said that is exactly what the Legislature did in its effort to direct money to those who could use it most effectively and efficiently.

"By funneling money to existing providers, it could be best utilized to address the needs of the homeless," he said.

Grant approval included a thorough screening by House and Senate money committees and included recommendations by the Housing and Community Development Corp. of Hawai'i. Awards were made based on which programs could start up, manage and operate programs in the shortest period of time, Menor said.

AGENCY SATISFIED

HCDCH raised no concerns about the bill. "We got the majority of our budget request for the year and that's something that we're pleased with," said housing information specialist Adrienne Gardner. "We're pleased with the outcome of the 2006 session."

However, she noted the grants were a departure from the way homeless services traditionally have been funded, which could be why many existing providers were caught off guard.

In the past, HCDCH has been given a lump sum to distribute through a competitive bid process, but providers were warned ahead of time that it was likely to change this year.

"We did try to provide them with guidance to put in a request separate from our own," Gardner said. "Some of them took advantage of that and some of them did not."

Reach Treena Shapiro at tshapiro@honoluluadvertiser.com.