Chicago Mayor Rahm Emanuel announced a plan yesterday for which the city will spend $2.5 million a year to help its homeless residents. AFSCME Council 31 public employees union is upset about the plan because the strategy will outsource the city’s overnight homeless transport service.

Privatization plan aside, the Chicago Coalition for the Homeless says that Emanuel has at least taken steps toward identifying the scope of the homelessness problem in the city.

The city will outsource its vehicles to Catholic Charities. The vehicles will transport the homeless to shelters between midnight and 8 a.m. The shift in responsibilities will result in the laying off 45 city employees.

Matt Smith, spokesman for the Department of Family and Support Services, says the city will save $1.77 million a year because Catholic Charities has “different staffing schemes, vehicle usage and routing plans.” Smith emphasized that this savings will be directly applied toward the $2.5 million annual outlay in homeless services.

Smith says that the city is asking Catholic Charities “to consider all of the impacted workers for new positions.”

Ed Flavin, spokesman for Catholic Charities said that his organization would consider laid-off employees, but would not necessarily give them priority for available positions. Flavin says Catholic Charities will hire 30 new full-time workers and 20 new part-time employees to work on the city contact.

In a statement released yesterday, Henry Bayer, executive director for AFSMCE Council 31, called on the city council to “immediately convene a hearing to carefully scrutinize this troubling privatization plan.”

“Privatization time and again is shown to result in a diminishment of services to the public,” Bayer said in the statement.

Flavin of Catholic Charities countered that providing homeless services is the “bread and butter” of the non-profit organization. Homeless advocates interviewed agreed that Catholic Charities has a good reputation, but they were not sure whether privatizing the transport service would prove wise.

As for what the homeless program will provide, Ed Shurna, executive director for the Chicago Coalition of the Homeless, said that his group is happy that $500,000 each year will go toward job training and placement services to homeless adults. “We believe that jobs should be a key component to any homeless plan,” Shurna says. “None of this is enough -- $500,000 is a drop in the bucket. But I applaud the $500,000.”

Another $1 million will go to expanding support centers and $1 million will also be set aside for 100 additional shelter beds for homeless youth.

Shurna says that small amount of money Emanuel is spending on the homeless (the fiscal year 2012 city budget is $6.2 billion and that does not include sister agencies such as the Chicago Public Schools) is equivalent to what Richard Daley set aside during his mayoral tenure.

But, Shurna says, Emanuel has provided more specifics such as acknowledging the need for affordable housing. The plan sets out a goal to provide 3,515 affordable housing units to extremely low-income people, defined as residents with 15 percent or less of the area median income. The city does not have any funding in place for this housing, but Shurna says, “It is a specific number that we can hold them accountable for.”

Bob Palmer, policy director for Housing Action Illinois, says Emanuel has done a “decent” job to preserve homeless funding such as pushing for state money to keep shelters open. But the majority of government spending for homeless programs comes from the federal level. Palmer notes that this money is down due to the  expiration of the 2009 stimulus bill.