City of Austin not renewing ARCH contract with nonprofit Urban Alchemy

Urban Alchemy's contract not renewed by city

The Homeless Strategy Office will not be renewing Urban Alchemy's contract. The California-based nonprofit runs the Austin Resource Center for the Homeless, also known as the "ARCH," and the Eighth Street Women's Shelter.

AUSTIN, Texas - The City of Austin's Homeless Strategy Office will not be renewing Urban Alchemy's contract.

The California-based nonprofit currently runs the Austin Resource Center for the Homeless, more commonly known as the ARCH, and the 8th Street Women's Shelter.

What we know:

The Homeless Strategy Office says Urban Alchemy reported five of their own employees for changing the data that tracks how people experiencing homelessness move through the system.

"When that type of data is changed, it could make a shelter look more efficient than it actually is. That's a major issue for us. And it's obviously a major issue for the public. If the data is not accurate, and that's the reason why we've decided to transition this contract to another operator," said David Gray, director of the Austin Homeless Strategies and Operations Department.

The ARCH's men’s shelter offers housing and services while people search for permanent placement, while the 8th Street Shelter provides a safe space for women and the LGBTQ community downtown.

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"They came to Austin under an emergency contract to help get the ARCH back online and clean up the area around the ARCH. They opened our 8th Street Women's Shelter at a time when the Salvation Army left downtown Austin," said Gray.

Gray says the issue has been corrected, but the contract will still end.

"While I give Urban Alchemy a lot of credit for self-reporting the issue, they were also fully aware of the consequences to come, which is that we would have to allow that contract to expire," said Gray.

Urban Alchemy sent FOX 7 Austin a statement saying in part:

"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."

Local perspective:

Employees not involved are still paying the price — like Antione Baker, an Urban Alchemy Employee.

"It ended up causing a lot of us our jobs. The situation. We have people there that's pregnant, we have people that have been there for years and that's all they know," said Baker. "It's devastating. I'm not gonna lie because, like I said, Urban Alchemy can be a great program. And I feel like we all getting punished for somebody else's mistake."

He says he received a notice on Sept. 17 saying layoffs will take place on Sept. 30. The notice said the city told Urban Alchemy about it just two days prior.

Baker worries finding new employment will be difficult.

"Most of all, you know, a lot of what most of us, I'm pretty sure all of us are felons and we don't get opportunities like this. We don't get this second chance. And a lot of us are not going to better just find a job just that fast," said Baker.

Baker says he has applied to work at Endeavors, but doesn't know what his future holds.

What's next:

The city is now finalizing an emergency contract with Endeavors—a nonprofit that already operates other shelters in Austin.

Urban Alchemy’s contract expires Tuesday, Sept. 30, and endeavors will take over Wednesday, Oct. 1.

The city says Urban Alchemy, Endeavors, and the city are formalizing the next steps, and those who were not implicated in any wrongdoing will have an opportunity to reapply for their positions.