A woman sleeps in a doorway in downtown Sacramento, near the state Capitol where lawmakers are negotiating over how to spend homeless funds. Photo by Dan Morain for CALmatters.


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California lawmakers have approved more than $2 billion in new state spending on housing and homelessness. If that sounds like a big number, it is.

The lion’s share will target the state’s homeless population, including $650 million in grants for local governments to build and maintain emergency shelters and $100 million for wrap-around care for the state’s most vulnerable residents. That’s about 50% more than former Gov. Jerry Brown approved to fight homelessness last year at the urging of California’s big-city mayors. Another $500 million will go to quintuple the size of the state’s premier affordable housing financing fund, a long-sought victory for low-income housing advocates who have sought an augmented funding source for years. The state Low Income Housing Tax Credit Program provides tax credits that subsidize the creation or rehabilitation of housing reserved for low-income residents.

But while lawmakers and Gov. Gavin Newsom have agreed to cut big checks, they’re still fighting over who will actually receive the money and with what strings attached. Big-city mayors and lawmakers want homelessness grants directed towards the state’s largest 13 cities, while Newsom wants to spread out the money to include counties. Large cities like Los Angeles argue the brunt of the state’s homelessness epidemic is concentrated in their backyards, while smaller counties say they’re grappling with their own rising homeless populations for which they are woefully under-resourced. Lawmakers and the governor have until July 1 to settle that dispute, or the state will have to delay getting desperately needed homelessness funds out the door.

In January, Newsom pitched the controversial idea of denying transportation funds to cities not building enough housing. It’s still unclear whether a scaled-back version of that proposal will end up in the budget, as lawmakers involved in negotiations have expressed fears that cities can’t really control how much housing gets built within their borders. Another Newsom proposal that would speed construction of homeless shelters by sidestepping environmental laws also remains unresolved.

On this episode of “Gimme Shelter: The California Housing Crisis Podcast,” CALmatters’ Matt Levin and the Los Angeles Times’ Liam Dillon discuss what we know and don’t know about the state housing budget. They also interview Mike Neely, former commissioner for the Los Angeles Homeless Services Authority, about the state’s rising homelessness numbers.


CALmatters.org is a nonprofit, nonpartisan media venture explaining California policies and politics.