Newsom rejects $1B in homelessness funding, igniting a blame game

Updated Nov. 4, 10:10 a.m.

Governor Gavin Newsom blocked $1 billion in funding for local governments to address homelessness, setting off a storm of finger-pointing between local governments and the state. Some officials including Sacramento Mayor Darrel Steinberg, acknowledged the need to do more.

Newsom rejected every application from counties and large cities for the funding Thursday, arguing the proposed plans for the funds would not do enough to get people off the streets and into shelter.

“We’re making progress, but not the kind of progress we needed,” he told reporters at a campaign stop in San Diego Thursday night.

The governor also plans to convene local leaders later this month to “coordinate on an approach that will deliver more substantial results,” according to a news release from his office. 

“Californians demand accountability and results, not settling for the status quo,” the governor said in a statement. “As a state, we are failing to meet the urgency of this moment. Collectively, these plans set a goal to reduce street homelessness 2% statewide by 2024.” 

“At this pace, it would take decades to significantly curb homelessness in California – this approach is simply unacceptable. Everyone has to do better – cities, counties, and the state included,” he said. 

While the state has set aside billions of dollars to address homelessness in recent years, many local governments are reluctant to commit ongoing funding to new shelters and services without long-term financial and logistical support from the state. 

Groups that represent cities and counties at the state Capitol condemned the governor’s move to pause the funding. 

“Now is not the time to play politics when people’s lives are at stake,”said Carolyn Coleman, executive director of the League of California Cities. “Failing to release state funding will not put roofs over the heads of Californians or deliver desperately needed supportive services.”

Coleman said blocking the funds is “the opposite of progress” and would delay shelter and services for unhoused residents. 

“If the state is looking for a real solution to this crisis, we need a statewide plan and sustainable state funding that supports long-term planning,” she said. “Equally important, we need to stop the finger-pointing and get to work on building a real partnership that will benefit all Californians.”

Graham Knaus, executive director of the California Association of Counties, said local governments share frustration over the growing rate of unsheltered people living on the streets, but echoed the call for stronger statewide coordination. 

“Counties welcome the Governor’s ambition to address homelessness, which requires a comprehensive statewide plan with clear responsibilities for all levels of government and the tools and resources required for success,” Knaus said. 

Sacramento Mayor, County react

In a statement to CapRadio, Sacramento Mayor Darrell Steinberg acknowledged the nation’s housing crisis has “caught up to Sacramento” and said he “take[s] the Governor’s provocation to heart.”

Steinberg called for “a legally enforceable obligation for all cities, counties, and the state to get more people into permanent housing” and a “right to mental health care for the people who are desperately sick on our streets.”

“It must not be optional, but mandatory, for counties to intervene directly in these numerous encampments where the suffering of people and our neighborhoods is so obvious,” he said. 

Others in Sacramento County took issue with Newsom’s interpretation that local homelessness plans would reduce homelessness by only 2%. A county spokesperson said the state based the results on the 2019 point-in-time count, when rates of homelessness were lower in Sacramento and around the state. 

Spokesperson Kim Nava said if the state based the numbers on the latest point in time (PIT) count, the goals would show a 10% reduction in homelessness. 

“Overall, a comparison between the 2019 PIT– which took place in January 2019, pre-pandemic to January 2022, in the height of the pandemic is not useful – we cannot improve the past and can only look forward,” she said. 

“While we welcome any recommendations from the State and other partners, we are disappointed that funding to support critical homeless programs is being held hostage during a time of such intense need,” Nava said. 

Homelessness ballooned in California and Sacramento County during the pandemic. Officials counted 9,278 unhoused people in the county during the annual point-in-time count earlier this year, a 67% increase since the previous survey in 2019.