Portland police say a year-long investigation into drug dealing at a city-run homeless shelter is continuing after producing two arrests and felony charges that include dealing cocaine within 1,000 feet of a school. Officers served search warrants at the Safe Rest Village in the 10500 block of North Portland Road and at a home in the 400 block of Northeast 16th Avenue, according to the Portland Police Bureau.
The Portland Police Bureau's Special Emergency Reaction Team, K-9 Unit, Air Support Unit, and North Precinct response teams all assisted in serving the warrants, according to the Portland Police Bureau. Investigators say the operation began after they received reports in September 2025 that someone living at the North Portland Road village was dealing drugs, according to KPTV. Investigators say they eventually uncovered what police described as an organized distribution network involving multiple people inside the village along with an outside supplier, per the same report.
Two people now face charges tied to the case. Keith Kelly, a 36-year-old from Portland, faces charges of cocaine possession, dealing cocaine within 1,000 feet of a school, and being a felon in possession of a gun, the station reports. Angela Burns, 65, also of Portland, was charged with dealing cocaine, cocaine possession, and tampering with evidence, after officers allege she tried to get rid of evidence as police served the warrant.
What Investigators Say They Found
Investigators seized suspected methamphetamine and written transaction ledgers from the shelter location, according to the Portland Police Bureau. The case includes a charge alleging cocaine delivery within 1,000 feet of a school. Kelly also faces a felon-in-possession charge, while Burns faces a tampering-with-evidence charge.
Police say the case remains open and that they are working with the Multnomah County District Attorney's Office on possible additional charges, according to KPTV. The bureau's own announcement noted that the investigation is continuing.
A Shelter Built for Stability, Now Under Scrutiny
The 10505 N. Portland Road shelter opened in late 2024 on land owned by the city's Bureau of Environmental Services and is operated by the nonprofit Urban Alchemy, which manages several of Portland's city-sanctioned alternative shelter sites, according to the City of Portland. The site's planned capacity is expanding to 212 shelter units as RV parking spaces there are phased out.
Portland's broader Safe Rest Village model dates back to June 2021, when then-City Commissioner Dan Ryan launched it as a $20 million initiative funded through American Rescue Plan Act dollars, intended to create transitional pod shelters paired with wrap-around services, as reported by OPB. The villages were designed as temporary transition points to help people stabilize before moving off the street, per the outlet's reporting.
Shifting Rules and Shrinking Capacity
The bust comes as the city's alternative shelter system faces its own operational strain. In June 2025, shelter administrators introduced a 120-day engagement rule requiring residents to actively meet with assigned caseworkers or face mandatory exit, a policy Hoodline detailed in its January coverage of the rule's rollout. Around the same time, statewide drug policy has been tightening: Oregon's House Bill 4002 took effect September 1, 2024, rolling back parts of 2020's Ballot Measure 110 by re-establishing misdemeanor penalties for small-scale drug possession while pushing deflection into treatment programs, according to OPB.
Meanwhile, Portland and Multnomah County are moving in the opposite direction on shelter funding. Budget reductions announced this year will shut down 10 operating homeless shelters by the end of 2026, ending a multi-year expansion of the region's shelter bed network, according to a KGW report. A conversion to a different shelter model is planned for fall 2026.
Police have not said whether additional suspects tied to the alleged distribution ring will face charges, and the department's own statement described the broader investigation as still active. The North Portland Road site is one of the locations tied to the case, even as the case underscores the tension between low-barrier shelter access and the security challenges facing large-scale sites like it.
