It’s been 22 months and three unemployment appeals since Nicolas Allen’s last job in Fresno.

In the time it has taken the 44-year-old graphic designer to win a fraction of the benefits that he applied for, his wife has weathered a high-risk pregnancy, his youngest son was born and his family has been pushed to the financial brink.

Now, Allen is one of thousands of Californians who say they lost jobs due to the pandemic, but are still fighting lengthy legal battles over unemployment money that state and federal relief programs were designed to provide. It’s a ripple effect of earlier benefit backlogs that ensnared some 5 million people at the state Employment Development Department (EDD), which officials have said was unprepared and overwhelmed by mass job losses.

Those caught up in payment disputes say they have struggled with debt, housing and necessities like food or health care. Meanwhile, no one is publicly tracking how much appeals cases and lawsuits might end up costing workers or taxpayers in a state that still owes the federal government nearly $19 billion in unemployment debt.

“It’s easier to not think the money’s there,” Allen said. “Because if I worry about it too much, it’s too painful.”

The EDD has paid out $188 billion in unemployment benefits since the first pandemic shutdowns. State and federal officials waived many ordinary application requirements as millions of claims flooded in, and the agency has acknowledged that up to $31 billion was paid to scammers in the rush to distribute money quickly.

Along the way, state watchdogs say up to 1 million workers were wrongly denied benefits — many mistakenly flagged for committing fraud themselves. “Accusing people of fraud is a big deal,” said George Warner, director of the Wage Protection Program at San Francisco’s Legal Aid at Work. “And the EDD does it very casually, very frequently.”

The biggest logjam of contested unemployment cases lies in a state appeals process, where more than 1 million workers have asked for a review of EDD’s decisions in their cases since March 2020. About 880,000 of those cases have already been transferred and heard by a lesser-known state labor agency, the California Unemployment Insurance Appeals Board, where the average case is still languishing for 139 days before a hearing with a judge, federal data shows.

Dozens of workers who have exhausted this state process have elevated their claims even further, to appellate or superior courts. Finally, advocacy groups and hundreds more workers have joined proposed class-action lawsuits against the EDD or its debit card contractor, Bank of America.

Both the EDD and the Appeals Board refused requests for interviews to discuss workers’ concerns and state efforts to respond. The agencies also referred some inquiries to one another or offered conflicting answers, raising questions about how delays and associated costs are being tracked.

“I had no money, and I kept saying: ‘How long is this going to take?’”
Carole M., office manager in Southern California

Gregory Crettol, assistant director of the California Unemployment Insurance Appeals Board, told CalMatters in a statement that the Appeals Board has hired and trained 105 judges and 100 new support staffers since the onset of the pandemic. The board is also rolling out a new online system for workers to track their cases, and officials said at an April meeting that judges are now closing almost twice as many cases per month as pre-pandemic.

Still, “Given the historic backlog of appeals,” Crettol said in a statement, the Appeals Board “anticipates it will likely take several more years to completely resolve before workload returns to normal levels.”

Unemployment cases are complex and vary widely, but workers awaiting disputed funds have faced similarly dire challenges. A 33-year-old video editor in Burbank had to create a GoFundMe to restart her life during a gender transition. A security guard In L.A. County worried whether fellow workers still seeking unemployment would end up in the homeless camps he once patrolled. A 62-year-old temp worker in Sacramento spent months terrified she’d lose her car, and a legal office manager in Southern California filed for food stamps and MediCal to survive an appeal with no end in sight.

“I really feel like I’m a hostage,” said the office manager, who asked to be identified only as Carole M. and has been awaiting an appeal hearing since November. “I had no money, and I kept saying: ‘How long is this going to take?’”

Fraud fury

Like many of California’s COVID-era unemployment challenges, slow and unwieldy payment disputes aren’t new. But the pandemic did two things: unleash an unprecedented flood of 29 million jobless claims, and supercharge anxiety about a new generation of online fraud.

Rival politicians have seized on jobless claims filed in the name of death row inmates and YouTube rappers bragging about EDD-fueled spending sprees. Investigators attribute the bulk of pandemic unemployment fraud to organized identity theft. Unemployment attorneys, meanwhile, say they’re seeing regular workers who thought they were eligible for benefits disqualified — and sometimes charged with lying — in cases that can sometimes be explained by confusion about state forms, clerical errors, language barriers or disagreements between workers and employers.

“It’s so wrong,” said Assaf Lichtash, founding attorney of Los Angeles-based Pershing Square Law Firm. “The way I see it, the EDD is punishing regular civilians that are just filing for benefits who make honest mistakes — they’re punishing them for their failure to safeguard the money from fraudsters.”

State reports have also highlighted a disconnect between the EDD’s ham-fisted approach to large-scale fraud and what some say seems like a hair-trigger impulse to flag individual workers. Organized scammers evaded the agency’s automated application systems early in the pandemic, one September 2020 report by a governor-appointed EDD Strike Team found, while the vast majority of individual workers scrutinized in manual reviews appeared to be innocent.

“Processes intended to block fraud are slowing service delivery without catching fraud,” the Strike Team wrote, since just .02% of the 1.3 million cases flagged that summer appeared to be real fraud. “The cost of finding that small number of imposters is extremely high.”

A separate report last August by the Legislative Analyst’s Office found that, during the pandemic, state appeals judges overturned EDD unemployment denials up to 80% of the time. That report highlighted another sample of 1.1 million unemployment claims stopped due to fraud concerns by an EDD consultant early in the pandemic, where at least 600,000 cases were later “confirmed as legitimate” and workers saw payments needlessly delayed. Even before COVID upended the job market, the Analyst’s Office estimated that improper unemployment denials cost workers $500 million to $1 billion a year in unpaid benefits. The agency also noted “concerning steps” at EDD in recent years that “suggest that ensuring eligible workers get benefits is not among its top priorities.”

The EDD refused to discuss its approach to appeals during the pandemic. Over the past three years, the agency has invested heavily in new anti-fraud technology and sought federal waivers for some workers who may have received extra federal pandemic unemployment funds “through no fault of their own.”

For workers who still want to fight an unemployment case, the first step is to notify the EDD in writing. The EDD then transfers the case to a local office of the Appeals Board, which schedules a hearing with an administrative judge. If a worker or business still feels that their case is unresolved, they can file another appeal with the state-level office of the Appeals Board, or eventually escalate the case to a superior or appellate court.

As of March, the average first-level appeals case with a judge was taking 139 days — a lag not as extreme as some other states, U.S. Department of Labor data shows, but still roughly triple the federal government’s 30- and 45-day targets for state unemployment appeals.

This kind of surge is predictable after a recession; the Appeals Board heard about 1.6 million cases in the years around the Great Recession, Crettol said. But workers like Allen, the Fresno graphic designer, have seen first-hand how pandemic cases can be complicated by heightened focus on fraud and differing interpretations of emergency health orders.

In Allen’s case, he told state officials that he quit his job in July 2021, when the Delta variant of the coronavirus was raging and his wife was instructed not to be vaccinated against COVID-19 while navigating a high-risk pregnancy. Since health precautions like masking were not strictly enforced at his in-person job as a sign installer, Allen wrote in a state appeals filing, he quit “to eliminate the risk of bringing COVID-19 home.”

One unemployment payment arrived, but then the money stopped.

Nicolas Allen in his home in Fresno on April 10, 2023. Photo by Larry Valenzuela, CalMatters/CatchLight Local

“I was told that it had been reported that it was a fraudulent claim,” Allen said. “Because my former employer was claiming that I quit without cause.”

So began an odyssey that involved months of arguing about pandemic protocols, clerical confusion over a brief freelance gig and paperwork ping-ponging between the EDD and the Appeals Board. After the second appeal, a state judge awarded Allen about six weeks out of the six months of benefits he applied for — securing around $3,000 of the $10,000 he sought, not counting potential federal unemployment supplements available during the pandemic — but denied the rest after questioning how actively he was seeking work while caring for two children under age 2.

Across the state, some 170,000 other appeals cases are still pending, according to the most recent data reported by the U.S. Department of Labor. Crettol said the Appeals Board is encouraged that new appeals have started to decline in recent months, and cited a lower state count of 154,000 backlogged cases through the end of March — a discrepancy that he said stems from differences in how state and federal numbers are reported due to funding sources and EDD processing times.

Attorneys like Lichtash add that for those stuck waiting, one challenge is a lack of information about if and when a case has been transferred to the Appeals Board from the EDD, the latter of which he called a “black hole.”

The EDD said in a statement to CalMatters that it sends cases to the Appeals Board in an average of three days. The Appeals Board offered a conflicting number: that it receives about two-thirds of appeals within a week after an appeal is filed, which Crettol said could differ due to how the two agencies track processing times. Neither agency regularly tracks the “monetary value” of appeals cases, or how much the state is being awarded or ordered to pay, spokespeople said.

For workers like Allen caught in the fray, the price of being caught up in the confusion has been high.

His family slashed expenses like cable TV and was able to refinance their house, which they credit with avoiding falling behind on the mortgage. But Allen said they were still forced to borrow money from family and take on credit card debt, putting everyday luxuries like a dinner at a restaurant with their kids out of reach.

“It’s horrible. I mean, we’re living off my paycheck,” said Allen’s wife, Sharon, who works in human resources. “We’ve almost divorced a few times because of it.”

A path for reform?

In many ways, unemployment advocates like Jenna Gerry say the pandemic has shone “a spotlight” on chronic problems with the state’s job safety net, from worker confusion over benefit denials to delays at EDD to inconsistent anti-fraud efforts.

The question she and others are asking now is whether state officials will act to change the system that has once again gone haywire, or whether workers caught up in pandemic disputes will be left to bear the brunt of the confusion.

“It was a perfect storm,” said Gerry, a senior staff attorney with the National Employment Law Project. “Instead of being like, ‘Wow, that was really bad. How do we make reforms now?’ … all people want to lift up is fraud, and not actually look at the systemic issues.”

The biggest underlying issue, Gerry said, is that millions of California workers — such as gig workers, undocumented workers and others in tenuous hourly positions — aren’t eligible for normal unemployment benefits. That was why the federal government started emergency jobless programs like Pandemic Unemployment Assistance. But subsequent high rates of fraud in the emergency program have complicated conversations at the federal and state levels about whether to make elements of the program permanent to cover more workers.

“All people want to lift up is fraud, and not actually look at the systemic issues.”
— Jenna Gerry, staff attorney with the National Employment Law Project

One potential change that advocates are watching closely in California is a plan to finally upgrade the state’s unemployment technology. The Appeals Board says it is rolling out a new system now, and the EDD is preparing to launch an effort called EDDNext. The challenge will be ensuring that such projects are more effective than other costly upgrades after the Great Recession, which audits said buckled at the EDD during the pandemic.

Among the more targeted reforms that state agencies have recommended, but which legislators have yet to act on: removing the EDD from the appeals process, expanding the role of the Appeals Board or adding a new surcharge for businesses that frivolously appeal unemployment insurance (UI) claims.

“To correct state practices that have the effect of limiting UI payments,” the Legislative Analyst’s Office wrote last summer, “the state should give the appeals board the authority and responsibility to set UI policy and practices.”

As these debates drag on, some unemployment advocates and workers are taking matters into their own hands.

In one Alameda County lawsuit against the EDD, the Sacramento-based Center for Workers’ Rights negotiated a February settlement to head off more payment disputes. The EDD agreed to cancel around 5,000 notices of overpayment sent to workers already past a year-long statute of limitations, and to refrain from sending other similar notices past the allowed timeframe.

The agreement applies only to workers not flagged for potential fraud, leaving attorneys to worry that others still caught up in disputes or unsure how to contest their cases will slip through the cracks. Workers marked for making false statements to EDD face severe penalties — they could be forced to repay the money at high interest, have their wages garnished or be disqualified from collecting benefits if they lose a future job.

“The burden is generally put on the claimant to appeal,” said Daniela Urban, executive director of the Center for Workers’ Rights. “But these notices never should have been issued.”

Madeline Maye, a video editor based in Burbank on Feb. 12, 2023. Maye lost $5000 to the Bank of America EDD debit card fraud of 2020. She had been laid off from her job just months earlier and was struggling to find freelance video editing work in the pandemic. The situation was compounded for Maye by the fact that she had just come out as transgender, was navigating hormone therapy, and trying to pay for essentials like rent and feminine-presenting clothes and products. Photo by Alisha Jucevic for CalMatters

Farther south, in Burbank, Madeline Maye is still seeking some form of closure two years into another proposed class action lawsuit.

The timing couldn’t have been worse in mid-2020, when, in the midst of hormone therapy and a gender transition, the video editor became one of thousands of California workers who noticed money draining from their unemployment debit cards in alleged fraudulent charges. The next year, she joined a class action claim against the state’s debit card contractor, Bank of America, which is now awaiting a hearing date before a federal judge in San Diego.

Bank of America has filed to dismiss the suit and declined to comment on ongoing litigation. It was separately fined $225 million last year by federal regulators for what they deemed “botched disbursement of state unemployment benefits.”

In Maye’s case, it took about six months to get her unemployment money back from the bank, forcing her to start a GoFundMe account to pay rent and buy essentials like new clothes to restart her life. Her lawsuit is one of several that will test what justice might look like after the state’s job safety net failed.

“I got my money back, but it was one of the worst times in my life,” Maye said. “It felt like I was alone — that no one gave a shit about me.”

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

Dave “Crackers” Lenardo passed away peacefully surrounded by his loved ones.

He was born to John Junior and Dorothy Lenardo at the Scotia Hospital on March 27, 1950.

He grew up on the family dairy ranch in Port Kenyon, Ferndale, learning both the language and customs of his Portuguese and Danish heritage.

Dave’s education began at Port Kenyon School, then transferred to Ferndale Elementary and High Schools.

Throughout the Eel River Valley, Dave was known as an early riser, fed and milked lots of cows, moved irrigation pipes, cut, raked, baled and hauled hay and tilled the soil.

He also built buildings and miles of fences.

Tractor work was his favorite. Lots of hours were spent mowing grass and weed eating fence lines.

Agriculture was his passion with his strong work ethic and sense of humor.

Country music was always playing, even in the cow barn.

Dave spent most of his time on earth being a good steward to the farmland and animals.

He always enjoyed nature and the outdoors, especially Centerville Beach when the surf fish were running.

Dave is in the presence of his Heavenly Father, experiencing never-ending love joy and peace.

Dave is survived by his siblings: John Lenardo, III, Joan (Tom) Hubner, and Patsy (John) Miranda; and his children: Jereme (and Amber), Heather, Kevin, Shawna, Bernadette, Bradley (and Trisha); and grandchildren: Shaylynn, Kelsey, Hunter, Bradley Jr., Casey, and Charlotte; and his partner Mary Enos-Lenardo.

He is also survived by many wonderful nieces, nephews, cousins and friends.

Dave was preceded in death by his parents John G. Lenardo Jr. and Dorothy (Hansen) Lenardo and his sister Rita Lenardo.

The family will be holding a private celebration of life.

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United State Magistrate Judge Robert M. Illman on Friday dismissed a federal class action lawsuit brought by the nonprofit Institute for Justice on behalf of a group of Southern Humboldt property owners who alleged that the county’s cannabis code enforcement practices were illegal.

Specifically, the claim argued that the county’s administrative processes to abate illegal weed grows violated the plaintiffs’ constitutional right to due process; levied exorbitant and unjustified fines and fees; and deprived plaintiffs of their alleged constitutional right to have a jury present at an administrative hearing.

The lawsuit, which was filed last year, named the County of Humboldt as a defendant along with all five county supervisors by name and county Planning Director John Ford, in their professional capacities.

Having read Judge Illman’s 52-page decision (a link to which you can find below), I think it’s fair to say he effectively laughed this case out of court. His ruling repeatedly and comprehensively rebukes the arguments put forward by plaintiffs’ attorneys, describing their reasoning variously as “implausible,” “baseless,” “unreasonable,” “ineffectual” and riddled with “gross mischaracterizations.”

Here’s just one example of his upbraiding:

Despite the [first amended complaint’s] length, overlooking its irrelevant content, and its conclusory and implausible assertions – and in light of the materials of which the court is taking judicial notice – it becomes clear … that the underlying facts do not, and simply can not, entitle these Plaintiffs to any relief against these Defendants.

Here’s another:

Spanning 70 pages, with more than 600 numbered paragraphs, the [complaint] is overwhelmingly dominated by legal arguments couched as factual allegations, unreasonable inferences, unwarranted deductions, conclusory assertions, unjustified labels, and hyperbole. As to the relatively small number of paragraphs that do contain actual allegations of fact, the vast majority of that content is either irrelevant or simply implausible.

He takes the plaintiffs’ allegations one by one. Regarding a claim that they had been subjected to “excessive fines and fees,” Judge Illman proceeds to describe each one’s individual circumstances before noting, “No party has actually paid a fine.”

Regarding a claim that the county routinely denies land-use permits to landowners with outstanding abatement orders, Judge Illman writes, “Plaintiffs concede that they have not actually received any such final decisions by having had any such land-use permit applications rejected.”

Regarding the demand for a jury trial he writes, “[T]here is no right to a jury trial in the sort of administrative hearing at issue here – something which Plaintiffs appear to vaguely concede.”

Furthermore, he observes, the county’s code enforcement regulatory framework “expressly provides for full-fledged judicial review after the conclusion of the administrative phase of the proceedings.”

The allegation that the plaintiffs have been denied due process, meanwhile, gets dismissed for failure to state a claim. Attorneys for the plaintiffs listed ten examples of the county’s alleged failure to provide adequate notice or an opportunity to be heard, but Judge Illman concludes, “all either implausible, irrelevant, conclusory, or are based on unreasonable inferences or unwarranted deductions.”

Ultimately he dismissed every last claim with prejudice, meaning the suit cannot simply be refiled in U.S. District Court’s Northern District of California, where it was heard.

But in a press release published on Redheaded Blackbelt, attorneys with the Institute for Justice vow to appeal the decision to the Ninth U.S. Circuit Court of Appeals.

The press release says the judge “accepted as true many of the county’s factually incorrect statements,” and attorney Jared McClain adds, “We disagree with the court’s decision and will continue to fight for justice on appeal, ensuring that the rights of Humboldt County property owners are protected.”

In an emailed statement, Humboldt County Public Information Specialist Cati Gallardo said, “While we were disappointed that a small number of residents chose this route in an attempt to resolve their existing violations, we are pleased by the court’s decision. The United States Magistrate Judge is direct in the rationale for ruling on each count, and we appreciate the clarity provided by the court. We look forward to resuming collaboration with property owners to resolve these and other open cannabis-related cases.”

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DOCUMENT: Order Re: Motion to Dismiss Amended Complaint

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PREVIOUSLY:

• “Scanner Traffic Indicates,” May 15.

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Press release from Blue Lake Fire:

On May 15, 2023 at approximately 9:12am Blue Lake Fire Department was dispatched to a reported residential structure fire at the 500 block of Hartman Street. Initial reports stated there was a possible explosion at the residence. One Blue Lake Engine responded as well as the Blue Lake Chief. Upon arrival crews found a single story residential structure fully involved.

Firefighting operations established a defensive attack. It was determined that the “explosions” heard from the residence was the result of a large amount of ammunition present as scene. The Humboldt County Sherriff’s Office issued an evacuation order for the residents in the immediate area of Hartman and Blue Lake Boulevard. Fire personnel had the fire knocked down in approximately 35 minutes after the initial dispatch.

One dog was rescued from the structure, however, one dog and two cats were not accounted for at scene after firefighters looked through the home after the fire was controlled. Blue Lake’s Chief began to release mutual aid resources at approximately 11:00am; crews remained on scene for clean up until 12:30pm. The cause of the fire is still under investigation; at this time it is unclear as to what started the fire.

Blue Lake Fire would like to thank our allied partners for their assistance during this incident, Fieldbrook Fire, Arcata Fire, Humboldt Bay Fire, and Westhaven Fire. We would also like to thank CHP, PG&E and HCSO.

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Martina Scarfia | Photo via Facebook, used with permission.

Martina Scarfia, a 25-year-old Eureka woman who graduated from College of the Redwoods’ nursing school Saturday, died at Moonstone Beach Sunday afternoon despite rescue efforts from concerned onlookers and the U.S. Coast Guard.

While out surfing, Scarfia experienced an unknown medical emergency and lost consciousness, her older sister, Asia Autumn Scarfia-Ward, told the Outpost on Monday.

As first reported by Kym Kemp on Redheaded Blackbelt, the Coast Guard and other agencies were dispatched to Moonstone Beach Sunday afternoon in response to a 911 call regarding a surfer who’d been pulled from the ocean.

Trinidad resident Larisa King was at the beach with her husband at the time, and in an email to the Outpost she said that they and other beachgoers attempted to help Scarfia, who appeared unconscious.

“My husband and I saw what happened and assisted with contacting 911,” King said in her email, adding, “She was ultimately airlifted by coast guard helicopter after a period of approximately 30 minutes of chest compressions.”

Scarfia-Ward confirmed in a Facebook post this morning that her sister passed away Sunday. 

“My beautiful baby sister took her last breath yesterday,” Scarfia-Ward wrote. (She gave the Outpost permission to share her message with the public.) “I am so proud of everything she has done and the amazing person she has become. She graduated from Nursing School with honors on Saturday. We celebrated as a family and paddled out together one last time until paradise. I love you Martina Scarfia.”

Scarfia was born in Nebraska but raised here in Humboldt County since 2000, her sister told the Outpost.

We have requested more information from the Coast Guard and the Humboldt County Sheriff’s Office. We will update this post as that information becomes available.

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UPDATE, 1:55 p.m.: 

From the Humboldt County Sheriff’s Office:

On May 14, 2023, at about 3:51 p.m., Humboldt County Sheriff’s deputies were dispatched to Moonstone Beach near Trinidad for the report of a surfer in distress.

According to witnesses, two women were surfing in the ocean when one of them, later identified as 25-year-old Martina Marie Scarfia of Eureka, reportedly became unattached from the surfboard and was overcome by waves. Another beachgoer was notified of the emergency and swam out to rescue Scarfia. She was recovered from the water and transported to a local hospital via helicopter by the U.S. Coast Guard Sector Humboldt Bay. Scarfia was later pronounced deceased.

An autopsy is in the process of being scheduled. Cause and manner of death remain under investigation, pending the results of the autopsy.  

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CORRECTION: This post has been updated to reflect that Scarfia lived in Eureka rather than Arcata.

Press release from the Humboldt County Department of Health and Human Services:

There are lots of reasons to celebrate in May — Mental Health Awareness, CalFresh Awareness and Caregiver Appreciation, just to name a few.

On Tuesday, May 16, join your friends and neighbors for the Take Action for Mental Health Walk. Participants will meet up at the Hope Center, 2933 H St. in Eureka at 11:30 a.m. and walk to the Humboldt County Courthouse and back. Wear lime green to show your support. Snacks will be provided.

On Friday, May 19, the Wellness and Connection Barbecue is scheduled to take place at the Jefferson Community Park, 1000 B St. in Eureka, from 11 a.m. to 2 p.m. Hot dogs and vegetarian options will be provided.

Humboldt County Department of Health & Human Services (DHHS) Behavioral Health Director Emi Botzler-Rodgers said these community events go a long way toward ending stigma.

“Mental health is part of a whole person experience and just like physical illness, mental illness can occur at various times throughout all our lives,” she said. “We as a community have a responsibility to respond to those with mental illness, our friends, family members, neighbors and ourselves, from a place of kindness and compassion.”

One in every four Americans experiences some form of mental illness, according to the National Institute of Mental Health. Mental health issues affect people regardless of gender, race, age, sexual orientation, social or economic status.

Many pregnant people and new parents also experience mental health challenges. According to the California Department of Public Health, one in five California women has symptoms of depression during or after pregnancy. Pregnant people and new parents who need assistance can call the 24-hour National Maternal Health Hotline at 1-833-9-HELP4MOMS.

If you or someone you know needs help, contact the local Behavioral Health 24-hour crisis line at 707-445-7715, toll-free at 1-888-849-5728 or call the Suicide and Crisis Lifeline at 988.

For a full list of events, visit http://humboldtgov.org/behavioralhealth.

To learn more about CalFresh and if you may be eligible, visit benefitscal.com, https://humboldtgov.org/CalFresh or call the DHHS Social Services Call Center at 1-877-410-8809.

To learn more about becoming a Resource Family, formerly known as a Foster Family, call 707-499-3410 or email DHHSFoster@co.humboldt.ca.us.

This month Californians worried about the cost of housing were offered the rarest of gifts: a glimmer of hope.

New numbers released by the Newsom administration show that California added homes to its housing stock at a faster clip than any time since the Great Recession — 123,350 additional units, or an increase of 0.85%.

Over that same period, the state’s population declined, marking the third year in a row that it’s fallen from one new year to the next.

Put those two numbers together and a surprising statistic emerges: There are now more homes per person — 3,770 units for every 10,000 Californians — than there have been since at least 1991.

For a state that has long suffered from too many people trying to cram themselves into too few homes, that’s an encouraging number at first glance.

It’s also the kind of news that might lead a person to wonder: Does this California exodus mean the state’s perennial housing shortage is finally coming to an end?

The long answer is “it’s complicated.”

Though many analysts have tried, no consensus exists on just how many more homes the state would need to build (or how many more people would need to leave) before we can call an end to the crisis and start to see rents and home prices fall within reach of working and middle class Californians.

But the short answer is “almost definitely, no.”

Much of the outflow of residents is itself driven by the high cost of living. In March, the median price of an existing single family California home was $791,490, more than twice the national median of $375,700.

“When house prices go up, people leave,” said Dowell Myers, a demographer at the University of Southern California.

Gov. Gavin Newsom said as much in a recent interview with UCLA’s Blueprint, naming the cost of living as the “principal driver” and its chronic shortage of homes “our original sin.”

And while experts don’t agree on exactly how much additional housing the state might need to attain an ill-defined “affordability,” they do agree on this much: it’s a whole lot more.

Just how big is California’s housing shortage?

In 2000, a report issued by California’s Department of Housing and Community Development estimated that the state would need to build 220,000 additional units each year for two decades to meet the needs of what was then still a growing population.

Needless to say, that didn’t happen. Even last year, a relative high-water mark for home construction, the total was roughly 100,000 units below that goal.

The department published another estimate in 2018 urging 180,000 units per year through 2025. And last year, in putting together housing goals for regions across the state, the department’s total prescription added up to 2.5 million new homes over the next eight years (or 315,000 per year).

The administration acknowledged the state’s sluggish population growth in its latest proposed budget for next year, which gauged the need at 148,000 new units per year.

One of the reasons these estimates vary is because there’s no single definition of a “housing shortage.”

In 2015, for example, the Legislative Analyst’s Office, an agency that serves as a think tank for state legislators, framed the issue with the following question: How many units would the state have had to build between 1980 and 2010 to keep the median value of an owner-occupied home increasing at the same rate as the rest of the nation, rather than skyrocketing so much higher, as it has for the last half century?

That definition of the state’s shortage led the office to estimate 210,000 each year. Alas, the state has only hit that annual mark five times since 1980 — and not once since 1990.

A year later, the global consulting firm McKinsey & Company, put out its own figure — 3.5 million homes by 2025. Newsom took that eye-popping figure as a rallying cry during his first gubernatorial run, when the then-candidate vowed that California would reach that total by the end of his second term. He’s since scaled the pledge back to 2.5 million, a goal the state is still unlikely to reach.

McKinsey based its estimate on its own version of the state’s housing problem: the number of new units required to bring California’s houses-to-people ratio in line with that of the rest of the country.

The common thread behind all these estimates is they are all very, very big. And whichever shortfall estimate you choose, the state has never hit the mark.

A moving target

But the numbers have been moving in a more encouraging direction in recent years.

The totals since 2020: roughly 430,000 new homes and some 821,000 fewer Californians competing to reside within them. That necessarily narrows the gap, however we define it, said Hans Johnson, a researcher at the Public Policy Institute of California.

If the shortage is relatively modest, he said, and “if we continue like this for another decade, with very slow population growth or essentially no population growth, and with fairly robust housing construction, then it should start to eat into that lack of housing,” he said.

But if the state needs to hit McKinsey-esque levels of new production, counted in the millions of units, “we’re still a long, long way off,” he added.

That’s in part because the size of the hole is so large. But it’s also because the shortfall is “a moving target,” explained Len Kiefer, deputy chief economist at the Federal Home Loan Mortgage Corporation. The building industry booms and busts. Young Californians grow old enough to live out on their own while older ones begin to die off. And people’s housing wants and needs change, too.

How COVID worsened the housing crisis

A particularly dramatic driver of such change: the pandemic.

Eager to keep COVID at bay and seeking more space to work from home, Californians dumped their roommates when they could and sought out places to live on their own, resulting in a great “spreading out,” as analysts at the Public Policy Institute of California put it. The trend toward fewer people living in each home is nationwide and long term. Over the last 40 years, the number of people living alone doubled across the country. But the pandemic put the trend on overdrive.

That worsened the state’s housing shortage. Even if the total number of Californians continues its gradual downward drift, more homes are needed to house the roughly 38 million sticking around.

Starting in June 2020, the median price of an existing single-family home shot up from $626,170 to a peak of $900,170 in May 2022, according to data compiled by the California Association of Realtors. That’s an increase of 44% in less than two years.

Since then high interest rates have brought California’s housing inflation back down to earth slightly. But the median price in March was still 29% above where it was three years earlier.

Whether Californians will begin clustering together again as COVID concerns ease is an open question. But there’s no sign that’s happening yet. By the beginning of 2023, with the worst of the pandemic presumably behind us, the number of Californians per household hit a record low of 2.77.

A shrinking population, driven largely by outward migration, provides an escape value for some of that extra pressure, said Meyer, the USC demographer. But based on analysis he and his colleagues conducted for the California Association of Realtors, it’s easy to imagine demand for homes staying strong, given how large the millennial generation is and how many are now reaching a baby-having, roommate-jettisoning age.

Plus, if the California exodus is a cure to the state’s housing shortage, it’s also a symptom, said Dowell.

“The ones who are older are leaving because they’re (homeowners) cashing in their gains,” he said of the nearly 8 million ex-Californians who exited the state last decade.”The young people who are leaving, we now think, are leaving because they can’t buy a house here.”

And even if those departures do ultimately alleviate the state’s scarcity of homes, it’s not the solution to the problem that anyone should want, adds Johnson from Public Policy Institute of California.

“I don’t think any of us who have been advocating for building more housing in California — to help alleviate the shortage of housing we’ve had and to improve affordability in the state — thought that the best path was just to have the state start to depopulate.”

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