Newsom’s budget has $3B for homeless, but he demands progress

Hector Amezcua

In November, Sharon Foster, a 63-year-old former cab driver, sits in her camper at a homeless encampment on Colfax Street in North Sacramento. Gov. Gavin Newsom said in his budget presentation Tuesday that he expects local governments to make more progress in lifting people out of homelessness.

California Gov. Gavin Newsom’s budget maintained billions in funding to help cities address homelessness, and he’s also pushing for more progress on the state’s “out of control” crisis.

Newsom on Tuesday presented his financial blueprint for the fiscal year beginning July 1, which contains $3.4 billion in homelessness spending to keep commitments made in previous budgets. This includes money for additional rounds of two grant programs: $400 million for connecting encampment residents with shelter and services and $1 billion for local Homeless Housing, Assistance and Prevention Program (HHAP) awards.

The governor continued to prioritize homelessness funding, even as the state faces a $22.5 billion deficit and mounting frustration over California’s increasing unhoused population.

Despite the blllions spent on care and prevention, the number of Californians experiencing homelessness has gone up in recent years, especially following the COVID-19 pandemic.

The population grew by nearly 10,000 from 2020 to 2022, when it reached 171,521 people, according to the U.S. Department of Housing and Urban Development. The state has the nation’s highest rate of homelessness — 44 unhoused people per 10,000 residents.

Sacramento now has more than 6,200 unsheltered residents, up from 3,900 in 2019. At least two homeless people recently died in the city after trees fell onto their tents during severe storms.

Newsom wants homelessness results

In late 2022, Newsom began to publicly question whether the state had gotten an adequate return on its investments.

The state since 2019 has distributed HHAP funds to local agencies to spend on homelessness. But 2022 marked the first year they were required to provide action plans to receive the money. In November, the governor briefly froze $1 billion in HHAP funds after receiving the plans, saying they were not sufficiently ambitious.

“Californians demand accountability and results, not settling for the status quo,” Newsom said in a statement at the time. “As a state, we are failing to meet the urgency of this moment.”

The governor eventually released the money after hosting a Sacramento summit with local leaders. But Newsom’s exasperation was still evident at his budget unveiling, when he was asked about advocates’ request for a more consistent homelessness funding stream.

“Let’s see results,” Newsom said. “We’ll fund success, not failure. I want to see results ... Let’s see results. I’ve been listening to that rhetoric my entire life: ‘We can’t do anything until we have more ongoing.’ I get it, I get it.”

“They’re not wrong, but they’re not right either,” Newsom added. “Let’s do our job. This homelessness crisis is out of control. People that criticize it are right. We need to see progress. And that means we have to have a higher level of accountability.”

Accountability legislation

The governor intends to enshrine that accountability in state law by asking for legislation to create more uniform spending priorities for local agencies receiving HHAP money.

Examples include encampment clearing, supporting facilities converted into housing and shelters through Newsom’s Project Homekey program and housing for those participating in the the governor’s mental health courts.

“It’s criteria, and it’s conditioned, absolutely, on aligning our goals,” Newsom said. “What we don’t want is 476 different strategies and goals, and that doesn’t even include all the (continuum of care programs) and counties, just every city running in different directions. We’ve got to start aligning the goals, and we have to be more prescriptive in that respect, by still though recognizing local conditions. I understand flexibility.”

The governor said homeless encampment clean-ups would be especially important, or he would be “hard-pressed to make a case to the Legislature to provide them $1 more.”

Regarding the homelessness accountability bill, Newsom said, “the Legislature is on top of this.”

“There are a few key legislative leaders that are lighting me up, saying, ‘I’m in. Don’t talk to my colleagues — I want to run that legislation,’” he said.

Lindsey Holden: 916-321-1207, @lindseymholden