Large encampments of homeless people, in Bellingham, has been problematic, however smaller camps on vacant public land have remained unbothered.
The larger camps have drawn more confrontation. They have tended to concentrate the problems of drugs and anti social behavior from a segment of their inhabitants.
I think allowing people to camp is a good idea, but smaller non confrontational camps work much better. The larger camps like at City Hall or Laural Park are problematic. Quite a few of the smaller camps remain around parts of Bellingham.
Tents and RVs scattered around town are less of a problem. More being allowed these days, due to the pandemic, but will likely become a trend as home prices keep going up and population keeps growing.
Bellingham has set up quite a bit of indoor shelter space where 6 foot distancing can be maintained. For instance Base Camp in an old retail space that is currently not in use for retailing.
Still, a lot of people prefer not being in a large community space. Having one's own little space is valuable to a lot of people.
Fortunately, I've never been homeless, but I often camp when bicycle touring. Seems like, as the years go on, campgrounds are getting more crowded. Unless they have hike and bike sites, campgrounds are often booked full well in advance.
It's getting harder to find legitimate camping on spur of the moment, but when bike touring, one is less apt to predict, way in advance, where one will be at the end of the day. Wind direction can effect one's schedule on a bike tour. Hard to make reservations weeks in advance.
Quite a few cyclist, including myself, sometimes hide in the woods when official camp spots are not available. Some cyclists do it as a preferred means, rather than paying campground fees, but I usually tried to stay in campgrounds when I traveled. Seems like that's getting harder to do in crowded regions like the western part of Washington State. Campgrounds are also getting a lot more expensive.