The amount of money California sent to the Sacramento region to address its growing homelessness crisis nearly tripled to $191 million between 2019 and 2021, with much of the increase set aside for homeless housing projects, according to a new report.
The sharp rise took place at the same time Sacramento County’s unhoused population soared to a record 9,300 early last year, up 67% from 2019.
Regional officials say the massive jump in funding reflects the state’s commitment to solving the problem. But a lack of progress in slowing the crisis as more state dollars flowed doesn’t mean officials wasted the money, according to Lisa Bates, who heads the nonprofit Sacramento Steps Forward, which receives and manages regional homelessness funding.
“It’s a timing issue,” Bates said. “It takes a while to ramp-up the siting and location of shelters. Definitely we know the development of housing takes time.”
An encampment near the X Street shelter in Sacramento, Calif. on Monday, Sept. 20, 2021.Andrew Nixon / CapRadio“Today’s funding might result in a housing unit for somebody a couple years down the road,” added Emily Halcon, director of Sacramento County’s department of homeless services and housing.
State dollars sent to the region ballooned from $65 million in fiscal year 2019 to $191 million in fiscal year 2021, as Governor Gavin Newsom’s administration funneled billions of dollars to communities across California for new homeless shelters and housing during the first two years of the pandemic, according to the Statewide Homelessness Assessment.
The report was produced by the state’s Interagency Council on Homelessness and presented to the Legislature last week.
It found California directed nearly $10 billion statewide to addressing the homelessness crisis, while providing services to more than 571,000 people over the three year period. Additionally, it found 40% of the people who made use of at least one of the services ended up housed, though the majority remained homeless or their whereabouts were unknown.
‘The tool we need to lift people out of homelessness’
In the Sacramento region, Halcon said most of the increased state funding comes from the Newsom administration’s homeless shelter and housing initiatives known as Project Roomkey and Homekey, along with a tax credit program. She called the state’s investments in affordable housing “pivotal” for keeping people off the streets.
“It’s also the tool we need to lift people out of homelessness,” Halcon said.
Under Roomkey, the Newsom administration paid cities and counties to shelter tens of thousands of unhoused residents in hotel and motel rooms during the first two years of the pandemic.
Homeless advocates and government leaders credited Roomkey for slowing the spread of COVID-19 within the unhoused community. But it wasn’t cheap.
Sacramento County spent $4,000 per guest each month, using state funds to cover the rooms, meals, security, laundry and health services provided to each participant at four motels countywide.
Homekey is Newsom’s longer-term and more costly initiative. It pays local governments to buy motels and hotels and convert them into permanent supportive housing for people experiencing homelessness. As of last December, it had created more than 12,000 units of homeless housing statewide, including several hundred units in the Sacramento region.
Last fall, dozens of families experiencing homelessness, including some with young children, moved into a permanent supportive housing community in Natomas called Vista Nueva. Monica Montalvo, who spent the previous year living in her car in Sacramento with her seven-year-old daughter, was among those who moved in.
“It’s just such a great opportunity for me to have an actual roof over my head, because I’ve been out in the elements for so long,” Montalvo said on her move-in day. “It’s such a blessing.”
The former Staybridge Suites hotel was converted into permanent housing by using $30.6 million in state Homekey funds to purchase the property.
It’s not clear from the report exactly how much the state boosted funding for the region’s affordable housing over the three years. But the report shows it increased by at least $51 million from 2020 to 2021.
A state spokesperson did not respond to requests for an interview about the report.
The Sacramento region is far behind on building enough affordable housing. A report published last May by the nonprofit California Housing Partnership found Sacramento County has a shortfall of nearly 60,000 affordable homes for its lowest-income renters.
Efforts are underway to close that gap, though housing advocates and elected officials say more must be done and faster. Construction is expected to start this year on approximately 1,800 units of subsidized affordable housing in the county, according to an analysis of figures provided by the Sacramento Housing and Redevelopment Agency. The figures show another 591 units were recently completed.
‘Show us what you did with the money’
The state report comes as elected leaders, business and taxpayer groups have called for greater accountability on the billions of dollars spent on homelessness.
Earlier this month, Assemblymember Luz Rivas, a Los Angeles Democrat, introduced a bill that she says would demand “tangible results” from local governments before they receive homelessness grants.
In January, Assemblymember Josh Hoover, a Republican from Folsom, called for an audit of statewide homelessness spending “to determine which programs are effective.”
Amanda Blackwood, president of the Sacramento Metro Chamber of Commerce, said it’s no surprise the region received a large increase in homelessness funding given the scale of the problem. But, she added, local agencies must be more transparent on how that money is making a difference.
“Show us what you did with the money — just a simple dashboard,” Blackwood said, citing the need for data presented online such as how much the region is spending on homeless housing per unit. “We need to know what’s going on with it.”
- Bruce Lee, president of the Sacramento Taxpayers Association, echoed that call, saying “accountability is key,” though he agreed it will take time for the state dollars to make an impact in the region.
Halcon of Sacramento County said the call for more accountability and transparency is “a completely fair expectation.” She added that her department is working on new ways to show the public how state and local dollars are being spent.
“It is our intention, our commitment, to do more of that,” she said.
Contact CapRadio reporter Chris Nichols at [email protected]
