Because the Casa Esperanza homeless shelter moved to a sobriety-based model, Santa Barbara may need to approve additional warming shelters for this winter.

The city provides Community Development Block Grant and Human Services grant funding to the shelter at 816 Cacique St. for its Community Kitchen and drop-in day services, which both were eliminated as of Sept. 17.

Casa Esperanza needs to change to a housing-first model with services offered only to the residents to stay financially sustainable, according to Executive Director Mike Foley.

Santa Barbara had to change the wording of its grant agreements with the shelter to reflect the service changes. Foley expects the shelter to serve fewer meals, dropping from 175,000 to 90,000 per year, and a decrease in day center services from 1,300 to 960 people per year.

To help fill the void of lunch meals, other organizations such as Organic Soup Kitchen, WillBridge of Santa Barbara and the Foodbank of Santa Barbara County have created or expanded lunch programs.

Casa Esperanza has always had a 200-bed emergency winter shelter, but this year it will be sobriety-based, so the city expects an increase in homeless people who have to sleep on the streets, community development business manager Sue Gray said.

The Central Coast Collaborative on Homelessness has a task force to find long-term solutions, but the city may receive requests for more warming-center funding for this winter, Gray said.

City Councilman Grant House on Tuesday asked where people will go who cannot or will not get a bed in Casa Esperanza.

“We’re not sure at this point,” Gray said.

The Santa Barbara Police Department reports that there has already been an impact, with fewer calls from the shelter’s area, but more in Isla Vista and Carpinteria, she added.

The shelter’s model had flaws in hindsight, since there were unintended consequences to the neighborhood, and now the community is approaching the issue with a housing-first mentality, Gray said.

The Rev. Mark Asman, board chairman for the shelter, said the organization has worked with other organizations to find ways to provide meals, but there are no other options in town for a day center, which was a place for people to come in and rest safely.

Councilman Frank Hotchkiss asked why the city funding amount isn’t changing even though fewer services are offered now, and Foley said the money is needed to keep paying for the cooks and case managers who are staying.

Foley estimates that 50 people per night (or half of the current shelter population) won’t be able to access Casa Esperanza anymore because of the sobriety requirement.

Instead, some people who come to warming centers and avoided Casa Esperanza in the past because of the “semi-chaotic nature of it” may want to become residents now, Gray said.

The center has been operating in the red for years, and Foley and the Board of Directors are planning a break-even $1.6 million budget going forward.

The under-one-roof model resulted in unsustainable deficits and borrowing, Foley said in a letter to the city.

Just because the shelter was running a deficit doesn’t mean the city’s money was spent badly, just that more was going out than coming in, City Administrator Jim Armstrong said.

In the last five years, 1,750 people went from homeless to housing through Casa Esperanza, Foley said.

The shelter may not be able to serve as many people in the future in terms of meals and drop-in services, “but we will be doing bigger things for hundreds and hundreds of people,” he said, adding that it will be a place for people to leave the culture of the streets behind and move toward housing.

A few people spoke during public comment, some saying the shelter has always been chaotic and others saying it did the best it could with limited resources.

The City Council approved the changes to the grant agreements at Tuesday’s meeting.

Noozhawk staff writer Giana Magnoli can be reached at gmagnoli@noozhawk.com. Follow Noozhawk on Twitter: @noozhawk, @NoozhawkNews and @NoozhawkBiz. Connect with Noozhawk on Facebook.