The Trump administration launched a federal investigation into the Los Angeles Homeless Services Authority (LAHSA) on Thursday, Sept. 3, alleging more than $1 billion in federal funds may have been wasted or misused since 2021.

Rep. Tim Burchett (R-Tenn.), chairman of the House Subcommittee on Delivering on Government Efficiency, summoned Mayor Karen Bass to testify at a Sept. 15 hearing titled "Fixing Fraud and Failure in Federally Funded Homelessness Services." The hearing is set for 11 a.m. in Room 2154 of the Rayburn House Office Building in Washington, D.C., Spectrum News reported.

Bass's office has not publicly responded to the summons. The New York Post reported it reached out to the mayor's office for comment and received no response.

Burchett's letter demanded Bass bring documents and communications related to what the subcommittee called corrupt contracting and grant-making by LAHSA. The panel also requested records from Jan. 1, 2020, to the present on LAHSA's internal controls and federal fund usage.

Those documents are due Sept. 14.

What the subcommittee flagged

The subcommittee cited specific allegations of self-enrichment among nonprofits receiving LAHSA funds. Among them: a $2.1 million contract signed by former LAHSA CEO Va Lecia Adams Kellum with Upward Bound House, the employer of her husband. Public records showed she personally authorized the contract, though she had previously told LAist she had recused herself. LAHSA said the contract had "inadvertently ended up" in front of her, according to the New York Post.

The panel also pointed to 1736 Family Crisis Center, which has received more than $36 million in federal grants since 2008. The organization's CEO, Carol Adelkoff, received $1.6 million in total compensation over two years, including a $495,000 bonus. The median annual pay for leaders at 16 comparable LA-area nonprofits was $159,737, according to the committee.

Funding fight in the courts

The investigation adds a new front to an ongoing battle over LAHSA's federal dollars. The U.S. Department of Housing and Urban Development (HUD) notified LAHSA on June 11 of its intent to suspend federal Continuum of Care funding. LAHSA sued, and U.S. District Judge David Carter issued a partial preliminary injunction on Aug. 13 blocking the suspension and restoring LAHSA's access to fiscal year 2026 funding.

Carter found HUD's action was arbitrary, capricious and not in accordance with law under the Administrative Procedure Act. But the judge also criticized all parties involved, writing that LAHSA, the city and HUD have participated in what he called a decades-long cycle of failure and blame-shifting while nearly $1 billion in taxpayer dollars flowed through the system over five years.

Nearly $241 million already earmarked for the LA region by Congress is at stake.

When LAHSA filed its lawsuit in late June, Commission Chair Amber Sheikh said the agency was "taking legal action because our first and highest responsibility is to protect this system and the people who rely on it," according to a LAHSA statement.

City already moving away from LAHSA

The federal scrutiny comes as the City Council is distancing itself from LAHSA. On Aug. 12, the council unanimously approved a package that could move city-funded homelessness programs away from the agency. Councilwoman Traci Park said at that meeting, according to Westside Current: "We are here as the last man standing in a failed enterprise, the writing has been on the wall."

Bass herself has acknowledged the system needs an overhaul. At a mayoral debate hosted by the Sherman Oaks Homeowners Association, she called the tri-government structure one of the system's fundamental dysfunctions and said the city needs to be in control, according to The LA Local. That outlet also reported Bass has missed 25 of 47 LAHSA Commission meetings since appointing herself to the board in late 2023.

Bass is running for reelection in November. The 2026 annual homeless count found street homelessness rose 8% in the city.

The next court hearing on the HUD funding matter is set for Sept. 22 in Judge Carter's Los Angeles courtroom. A trial in LAHSA's federal lawsuit against the Trump administration is scheduled for April 2027.