Homeless people living in the state's Kakaako emergency shelter will be charged $60 a month beginning Nov. 1.

Gov. Linda Lingle's administration proposed a fee for the Next Step shelter because of Hawaii's slowing economy, said Utu Langi, executive director of H-5 Project, a charity group under a state contract to run the shelter.

“;In anticipation of state budget cuts ... they wanted us to pick up some of the expenses,”; he said, adding that shelter occupants were informed about a month ago. Occupants will be required to pay $60 on the first day of each month, with a 10-day grace period, to sleep at the shelter, which is open from 5:30 p.m. to 8:30 a.m. and provides dinner and health services.

Families will have to pay $60 per unit, Langi said.

Vito Talo, 40, who has been at the shelter with his wife and three children for six months, said he hopes living conditions will improve at the warehouse once the rent kicks in, including more services like counseling and case management.

“;Most people would rather live here without paying rent,”; he said. “;If we are going to pay rent, a lot of things should be changing. But we got to be happy with what we've got. We rather not be on the street.”;

Russ Saito, state coordinator for homeless solutions, said a rent system for Next Step had been discussed even before Hawaii revenue projections began to drop. “;To cover their costs, they should have been charging anyway,”; he said. “;It is fairly consistent with what other shelter providers are doing.”;

One of the state's two other emergency shelters, Paiolu Kaiaulu in Waianae, charges between $100 to $180 a month, depending on room size, to residents who have income. The other shelter, Onelau'ena in Kalaeloa, remains free, he said.

In May the Institute for Human Services announced it would start charging $90 a month for homeless staying at its shelters longer than three months. The nonprofit group said fees would go toward more job and home placement support.

Institute Executive Director Connie Mitchell said shelters nationwide have been billing users to offset rising costs of everything from food to electricity and prepare them to budget for rent once they leave. “;It is something that really does promote a sense of self-sufficiency,”; she said yesterday.

Half of the money collected at the Next Step shelter will buy supplies such as paper plates and cleaning products, Langi said. The remainder, he said, will help homeless cover initial rent once they find housing.

As is done at the IHS shelters, Langi said those who show they are working to get out of homelessness will not necessarily be evicted from Next Step for missing payments. He said it would be “;counterproductive”; to kick out homeless people who might have legitimate reasons to fall behind in shelter rent such as suddenly losing a job.

In 2006 the state built the Next Step shelter within six days of the city closing Ala Moana Beach Park for repairs. Lingle issued an emergency proclamation to build the $500,000 shelter after hundreds were displaced from the park.

The shelter's occupancy, which reached 340 people later that year, is at 177, Langi said.

The shelter was scheduled to close at the end of June so the Office of Hawaiian Affairs could build its new headquarters there. But OHA agreed to allow the state to keep it open under a new 13-month contract that will cost taxpayers more than $900,000, Langi said.

The state spends $14 million annually in homeless programs. It also receives $4.5 million in Temporary Assistance for Needy Families money and $10 million in Housing and Urban Development funds, both from the federal government.

Hawaii's homeless shelters served 9,165 people in fiscal year 2007-08, Saito said.