Newsom to release $1 billion in homelessness funding, calls for more ambitious plans

California counties, cities and local agencies could start receiving a portion of $1 billion in funding to address homelessness as soon as this week following a meeting between local leaders and Gov. Gavin Newsom.

The governor surprised local leaders just over two weeks ago when announcing he would pause state funding for homelessness and reject all local homelessness action plans until cities, counties and local agencies could develop more aggressive plans to move individuals off the streets and into housing.

Newsom’s office said the submitted plans would have only reduced California’s homelessness by 2% statewide over four years – a figure the governor called “simply unacceptable.” As of January 2020, more than 161,000 people were experiencing homelessness in California, though that number swelled by at least 22,500 in recent years, as reported by CalMatters.

After convening with local leaders in Sacramento on Friday, Newsom said he has agreed to release the $1 billion in grant funding to address homelessness so long as local governments “agree to more ambitious reductions in unsheltered homelessness.” He is also challenging local leaders to submit more ambitious proposals in the next round of funding, and 21 local leaders have already agreed to do so, according to the governor’s office.

“This was an important conversation that allowed us to speak with candor and to share some good ideas with one another,” Newsom said in a statement. “Local leaders talked about the need for more city-county collaboration, more land use reforms to build housing faster, and to focus on keeping people housed who may be on the brink of homelessness — these leaders are our partners, and we all recognize we’re in this together.”

Newsom’s announcement earlier this month was met with surprise by some local leaders, who questioned how the governor’s move to delay the funding would help achieve the state’s homelessness goals.

Local leaders also raised concerns about consistent funding for homelessness following the governor’s announcement, arguing that sustainable funding is needed to make long-term plans to address homelessness. California has spent over $15 billion to address homelessness in the last two budget years, but much of the funding is meant to be spent over a two or three year period.

The latest $1 billion in grants made available to local governments comes in the third round of Homelessness Housing, Assistance and Prevention (HHAP) grants. To receive the third round of funding, applicants were required to create a Homelessness Action Plan showing how they will reduce the number of people experiencing homelessness in their local communities.

Carolyn Coleman, executive director and CEO of the League of California Cities, released a statement Monday saying that while cities are making progress in addressing homelessness with the funding available, “more is needed.”

“Supporting homeless and unsheltered Californians is a responsibility shared by the state, cities, and counties,” Coleman said. “Tougher fiscal times may be in our future so now is not the time to cut back or delay much-needed homelessness funding any longer. Now is the time to double down on long-term investments to address homelessness and support our collective efforts.”