Item 13 - OC Grand Jury's Investigative Report, Findings, and Recommendations Regarding Group Homes and the Orange County Animal Care Shelter

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WELCOME TO THE NEIGHBORHOOD in 2014.17 The City ultimately spent over seven million dollars in litigation, and prevailed in State and federal courts; however, in January 2023, a federal appellate court reversed and remanded the district court's 2020 ruling. Costa Mesa Ordinance.15-11 sets limited standards for three items that address important societal issues, none of which are discriminatory in nature: 1. Spacing (650 feet apart) 2. Background screening of the house manager 3. Process for evicting residents Spacing between group homes maintains the purpose of the facility and residential character of the neighborhood:_ Screening protects the residents of the facility. Through interviewees, the'Grand Jury learned of group home managers with criminal backgrounds and who are themselves currently substance abusers. Standards for - evictions are needed. Through interviews and newspaper articles, the Grand Jury _ - learned of the practice. of "curbing," putting residents out on the curb when their source -of payment runs out or when they are in violation of house rules. This practice is -believed to contribute to homelessness in Orange County. Costa Mesa's ordinance.. serves an important purpose, but the ordinance is still in litigation after several years and at an estimated cost of more than ten million dollars. $ _ - - Other Cities in California and -Orange County are similarly facing lawsuits and costs associated with group home.and sober living ordinances. Cities could pool resources to - mitigate -litigation cost. concerns. A coalition of cities to spread costs is highly recommended. The Grand Jury learned that the lawsuits brought against cities are supported and __—enabled:by_an_:extremely profitable -industry. --According to John LaRosa at ---- MarketResearch.com on February 5, 2020,19 the group home market is 42 billion dollars per :year. Mr. LaRosa :also .noted that the industry needed to be cleaned up as many of _the.:operators _eng.aged_it -overbilling, patient brokering, and deceptive marketing. The well -funded operators are' -supported by industry organizations and associations in their_ lawsuits. -Ind ustr_y-organizations include large groups such as the California - -Consortium of Addiction -Programs and Professionals, Behavioral Health Associates, and -National Sober Living Associates. The websites of any of these organizations and -several others.can be viewed to see the type of support often provided. The organizations not only provide -support for lawsuits, but also assist in lobbying State and federal legislators. -: Many group home.operators.do not want any type of regulation, as evidenced by the - Costa- Mesa an-d -Newport lawsuits, though the Grand Jury found some operators who welcome additional regulation-to,protect the industry from bad operators. In summary, the industry represents_ -a formidable foe in lawsuits due to funding and industry associations. ORANGE COUNTY GRAND JURY..2022 12023 Page 16 of 42