Dive Brief:
- California Gov. Gavin Newsom’s revised state budget proposal for fiscal 2026-2027 includes $500 million for the state’s Homeless Housing Assistance and Prevention fund, half of what prior rounds of funding included – but more than the zero new dollars budgeted in the current fiscal year.
- The state is also requiring “more accountability” from cities and counties seeking HHAP funding, according to a California Department of Housing and Community Development press release. Localities must demonstrate how state funding would reduce unsheltered homelessness, address encampments and adopt policies to increase local housing supply, the release states.
- Local government leaders rely heavily on HHAP funding, and proposed cuts will force cities to close shelter beds and cut homelessness prevention programs, according to League of California Cities Executive Director and CEO Carolyn Coleman. “Cities need an ongoing funding commitment to reduce the homelessness crisis, not a decrease in funding,” Coleman said in a news release.
Dive Insight:
California, the most populous U.S. state, also has the largest unhoused population in the nation. Last year the state reported a 9% reduction in unsheltered homelessness and its largest drop in homelessness in 15 years, a press release from Newsom’s office states.
That reduction coincided with a more aggressive state effort to clear homeless encampments, a policy Newsom has pressured local governments to adopt as well.
California mayors have characterized HHAP funds as a critical piece of the progress made in reducing unsheltered homelessness in their cities and counties.
“This progress is fragile without sustained commitment from the State,” San Diego Mayor Todd Gloria said in a news release about Newsom’s May 14 revised budget. “When funding and partnership fall short, cities are forced to scale back programs that are working, putting hard-earned progress on reducing homelessness at risk across California.”
The funding has provided permanent housing for more than 100,000 people since 2023, according to the National Alliance to End Homelessness. Cutting HHAP funding to $500 million in the next round could spur a 20% surge in homelessness across the state by 2027, NAEH said.
