When Good Intentions Make the Problem Worse: How Anchorage’s Homeless Crisis Became Ours
Contributed by Dana Raffaniello
Sometimes the hardest conversations are the ones where we admit that what we tried to do, with the best intentions, actually made things worse. That's the conversation we need to have in the Mat-Su Valley about homelessness.
For decades, our communities handled homelessness quietly and effectively. We had some, of course. Every community does. Job loss, family breakdown, addiction, mental health crises. But it was manageable. Local churches stepped up. The Salvation Army coordinated help. Valley charities worked together. Families took people in. We handled it person by person, neighbor by neighbor.
We weren't seeing encampments or dozens sleeping rough in Palmer or Wasilla. We had individual situations that got individual responses. That was our baseline. Then everything changed. Not because our economy collapsed or our drug problem exploded. Those numbers held steady. What changed was Anchorage, and the consequences are now ours.
The Federal Money That Changed Everything
Between 2019 and 2024, Anchorage received unprecedented federal homelessness funding. Emergency Solutions Grants, ARPA allocations, FEMA reimbursements, expanded HUD programs. Millions poured in, designed to prevent mass homelessness during COVID-19. But here's what nobody wants to discuss: these funding formulas rewarded higher homeless counts. The more people Anchorage documented as homeless, the more money it received. The more shelter beds filled, the more reimbursement claimed. The more service utilization tracked, the more future funding justified. This isn't conspiracy theory. It's how federal formulas work.
Success was measured by how many homeless people you could document; not how many you helped leave homelessness behind. The Anchorage Assembly embraced this model wholeheartedly. They converted hotels into shelters and expanded capacity rapidly. Remember the old Red Lion at 36th and the New Seward Highway, scheduled for demolition for highway expansion? Instead, the Assembly converted it into homeless housing. Federal money made it possible. They filled it with people, claimed the beds, and counted the numbers. And the homeless population exploded. Not just grew. Exploded.
Before 2019, Anchorage's homeless population was mostly Alaska Native individuals displaced from dry villages. After the funding surge, demographics shifted dramatically. More people from the Lower 48 with no Alaska ties. People who'd never experienced an Alaska winter. Why? Because word spreads. When you build capacity and offer services, people come. Anchorage became a known destination, and the Assembly celebrated every new arrival as proof they needed more funding.
When Politics Blocked Solutions
Mayor Dave Bronson saw it differently. He looked at people arriving from out of state, unprepared for Alaska's lethal winters, and proposed voluntary relocation assistance to help them return to the Lower 48 where they had family and support networks. It wasn't forced. It wasn't cruel. It was practical.
The Assembly blocked it at every turn. Not because it wouldn't work, but because it threatened their funding model. Every person who left was one less to count, one less justification for the infrastructure they'd built. Political battles trumped practical solutions.
The Inevitable Collapse
By 2023 and 2024, federal emergency funding dried up. COVID money stopped. Hotel reimbursements ended. Programs downsized. The Red Lion funding couldn't be sustained. Encampments were cleared because the city couldn't maintain them. But the people didn't disappear. They moved outward, along highway corridors and transit routes, to the Mat-Su Valley. Our local homelessness situation, the one our charities handled fine? That's still roughly the same. What's exploded is the imported crisis—overflow from decisions made in Anchorage that we had no part in.
The Legal Reality Activists Ignore
Here's where it gets truly frustrating. The same activists who championed Anchorage's capacity expansion model, who opposed every alternative Bronson proposed, are now attacking our borough mayor for not "doing enough" to fix the problem they created.
When Mayor Edna DeVries correctly states that the Mat-Su Borough is a second-class borough under Alaska statute, activists accuse her of insulting the community. They either don't understand Alaska's municipal governance structure or they're deliberately ignoring it. A second-class borough in Alaska cannot operate public housing. Cannot run homeless shelters. Cannot create a housing authority without voter approval. Cannot assume areawide social service authority without a public vote. Cannot duplicate powers held by cities like Palmer and Wasilla. When activists demand the borough "just build shelters," they're asking our government to violate state law. The mayor isn't being dismissive. She's being accurate about legal constraints.
Think about the absurdity: the same people who built a system in Anchorage dependent on high homeless counts and federal dollars, who blocked solutions that might have prevented this spillover, are now demanding that a legally constrained borough solve the crisis resulting from their choices.
They created a problem the Mat-Su is legally prohibited from solving the way they're demanding.
The Pattern We Must Not Repeat
Now we have a homeless resource center in downtown Palmer, following the same playbook that broke Anchorage. Build capacity, create a destination, hope the funding continues. We're seeing the predictable result: more people arriving with no Valley connections, no local family, no history here.
We're repeating the mistake. And when funding inevitably decreases, we'll face the same crisis Anchorage did, with even fewer legal tools to address it.
What Real Compassion Looks Like
This isn't about compassion versus callousness. Everyone involved cares deeply. But caring isn't enough if the system you build makes the problem worse.
Real compassion means asking hard questions: Are we helping people exit homelessness, or building infrastructure that needs homelessness to justify itself? Are we solving the problem, or managing it because management brings grants, jobs, and purpose? When we build a shelter, will it empty or stay full? If it stays full, is that success?
The Mat-Su can respond to immediate life-safety needs without building permanent infrastructure that attracts more people than we can sustainably serve. We can support Palmer and Wasilla, which have legal authority the borough lacks. We can demand that organizations using public funds prove they're helping people leave homelessness, not just documenting them in it.
Most importantly, we can learn from Anchorage's mistakes instead of repeating them.
The Mat-Su didn't create this crisis. Our local charities handled our baseline situation fine. But we're dealing with consequences of policy decisions made elsewhere, driven by federal funding formulas and political battles we weren't part of. Sometimes the most compassionate thing is being honest about what actually works, even when that honesty makes us uncomfortable. And sometimes good intentions, when they ignore how systems work, create exactly what they're trying to prevent.
That's the hard truth we need to face.