Audit reveals $45M deficit at King County Regional Homelessness Authority

Published 8:46 am Tuesday, April 28, 2026

An approximate $45 million shortage and an unreconciled receivables account of $8 million has county officials worried about the King County Regional Homelessness Authority’s financial condition.

On April 17, accounting consultant Clark Nuber released a forensic evaluation of the King County Regional Homelessness Authority (KCRHA) covering the period from mid-2021 through July 31, 2025, for the city of Seattle. KCRHA is a government entity formed in 2019 with the mission to operate a homelessness support system to address unsheltered homelessness throughout King County.

The authority is primarily funded by the City of Seattle Human Services Department and the King County Department of Community and Human Services, and has received a total of $533.9 million in funding from all sources from inception through July 31, 2025.

The report found KCRHA experienced recurring negative cash balances beginning in December 2023, and reached a negative cash position of approximately $44.7 million as of July 31, 2025. KCRHA had an administrative operating deficit of approximately $4.26 million, which includes approximately $1.26 million in interest charges that are not expected to be recovered. Additionally, the report said a receivables balance of $8 million could not be reconciled based on available records.

The report states KCRHA did not have a formal monthly accounting close process and standardized internal reporting package during the period, and accounting records often “lacked sufficient detail to readily trace transactions or balances.” It said financial records statements in 2024 and the audited financial statements had a variance of approximately $1.3 million.

The accounting consultant identified delays in cash reimbursements because of inefficient invoicing and review processes, significant administrative costs, programmatic overspending and lack of budget monitoring and tracking mechanisms of advance funds as the factors contributing to the deficit.

King County Executive Girmay Zahilay said the report “raises serious, concerning questions about KCRHA’s internal controls, fiscal management, and accountability.”

“Solving King County’s significant homelessness crisis requires honesty about where the regional response system is falling short and a commitment among government partners to bring more people inside,” Zahilay said. “We have a responsibility to ensure this system delivers results — operating with greater efficiency, full transparency, and strong accountability for every public dollar entrusted to us.”

King County Council member Rod Dembowski called for the end of the authority.

“It’s now time for elected officials to bring this failed experiment to an end,” Dembowski said. “The agency has failed in its core obligation – to make significant progress in getting people sheltered.”

King County and the City of Seattle sent a letter of expectations to KCRHA that outlined the actions they expect the authority to take, which include a written response to their funders on how KCRHA will address the findings and a written corrective action plan. The letter also outlines actions both the county and city will take to provide additional fiscal oversight while KCRHA works to meet the expectations outlined in the letter and to address the report’s findings.

Zahilay said he has also asked the King County Executive Finance Committee to identify options that protect the county’s investment pool.