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I've heard that a lot of them get dogs not only for the sympathy factor but also because it's less likely that the police will arrest them because it'd require getting animal control involved and the whole thing becomes too big of an ordeal for just arresting a panhandler.
Back in my early 20's I was driving home (I lived in a mostly black neighborhood) and I got stopped by the police because they thought I was driving around late at night looking for drugs. One cop actually told me "You're lucky you have your dog with you or I would search this car and take your arse to jail - just get out of here. I'm not waiting hours for animal control to get out here." even though I was just driving home. I hadn't changed the address on my license, so, ok, I could see why he'd think I was making it up. But that was when I learned about the animal control thing with getting arrested and just put two and two together for homeless people with dogs.I had not even thought about that one... makes sense...