RE: Ongoing State Funding to Reverse the Cycle of Homelessness
Dear Chairs Skinner, Ting, Caballero, and Carrillo:
On behalf of a statewide coalition called Bring California Home, the undersigned organizations are writing to request ongoing funding of $2.4 billion to put the state on a course for ending homelessness. This
funding will transform California’s response to homelessness, hold local governments accountable for
reductions in homelessness, and avoid costs associated with the state’s currently ineffective response.
Increasing rates of homelessness throughout the State. California leads the nation with the highest homeless population, the highest rate of chronic homelessness, and the largest populations of youth and veterans experiencing homelessness in the nation. With over 150,000 people experiencing homelessness at any given night, California is home to a quarter of the nation’s entire homeless population, despite being
home to only 12% of the nation’s population. Moreover, the COVID-19 pandemic has worsened our homelessness crisis by putting hundreds of thousands of Californians into financial distress, and either on the brink of or experiencing homelessness. It has also endangered the health and wellbeing of those experiencing homelessness, and depleted local resources. Even before COVID-19, over 1,000 people experiencing homelessness died each year in Los Angeles alone from causes directly attributable to homelessness.
One-time funding does not meet the scale of the need or voters’ expectations. California has no statewide strategy nor any long-term funding targeted to ending homelessness. That needs to change.
Despite polling showing that combatting homelessness has been voters’ top priority for the last few years, the state’s investment in solving our crisis has never exceeded more than .5% of the state’s total budget.
None of the state’s recent one-year programs have made the level of progress we need to significantly reduce the number of people falling into and experiencing homelessness. While the state’s investments have helped local governments shelter tens of thousands of people and thwart more dramatic increases in homelessness, one-time investment, by its nature, narrows practical uses, preventing a comprehensive response. It taxes local governments to create administrative structures, complete complex applications year after year, and creatively combine funding sources with different, often inconsistent requirements.
One-time funding also limits the state’s ability to hold local governments accountable for lasting results, and frustrates budget committees that have to make new funding appropriations before last year’s investments have been allocated. Experience in other states and in other policy areas clearly shows us that steady progress is only possible when governments plan well, fund sufficiently, and track outcomes consistently.
California’s leadership on greenhouse gas emissions and renewable energy are two of many examples of this
approach’s success.
For these reasons, the Legislative Analyst’s Office stated on February 5th, in response to the Governor’s proposal for one-time funding, “[A] clear, long-term strategy would make it more likely that the state’s investments would have a meaningful, ongoing impact on its housing and homelessness challenges” than one-time funding. And a recent State Auditor’s report indicates the fragmented response of multiple one- time programs has prevented progress on this issue.
Ongoing revenue scaled to meet the need, and invested in proven solutions dramatically reduces homelessness. Other states have succeeded in significantly reducing homelessness through state investment in targeted, effective interventions, including New Jersey and Michigan. Federal and state funding for comprehensive, evidence-based strategies to house veterans experiencing homelessness reduced homelessness among veterans by almost 40% over the last 10 years, even while homelessness among other Californians increased. Thirty years of studies shows providing people experiencing homelessness with housing and services reduces homelessness, as well as decreases in hospital and nursing home admissions, recidivism to jails and prisons, and foster care placement among individuals and families getting housed.
The budget can drive the comprehensive strategy in AB 71 (L. Rivas/Chiu/Bloom/Wicks), which would:
✔ Generate $2.4 billion in new revenue that will free up General Fund dollars currently spent on nursing home and hospital admissions, emergency room visits, and other Medi-Cal costs, prison and juvenile justice costs, child welfare costs, and more.
✔ Hold the state and local governments accountable for spending on evidence-based approaches to ending and preventing homelessness: permanently-affordable homes, rental assistance, and services to help people access housing stability.
✔ Change the state’s current approaches to local grants by setting, measuring, and reporting quantifiable outcomes, including reductions in racial disparities that result in Black and indigenous Californians vastly over representing—by almost 7 times the general population—Californians experiencing homelessness.
✔ Evaluate to make the program more effective through legislative changes.
✔ Foster collaboration between local governments and the state.
✔ Set aside 10% of funding to promote the needs of unaccompanied homeless youth, which account for 10% of California’s homeless population, using developmentally appropriate services and housing interventions.
✔ Make California more competitive for small and mid-sized businesses by addressing quality of life issues, like housing costs that put low-wage workers at risk of homelessness, and Californians with nowhere to sleep other than doorways and sidewalks near storefronts.
To generate $2.4 billion per year, AB 71 would restore the 1986 corporate tax rate for the corporations with profits of $5 million or more from business in the state, only 500 of which are based in California— one out of every 3,000 businesses (.03%). Regardless of where a corporation is located, this higher rate would apply to any corporation doing $5 million or more of business in California. Our proposal would also generate revenue by conforming to federal law that taxes multinational corporations that shift their profits overseas. Neither tax measure will touch the businesses most responsible for recent economic growth, or businesses that are suffering during the pandemic.
Your committees can alternatively allocate $2.4 billion per year to reverse the cycle of homelessness through General Fund allocations. Whether through identified revenue sources or the General Fund, we request ongoing funding of $2.4 billion per year to “bring California home,” and implementation of policy proposals in AB 71 to enact the comprehensive, strategic plan the Legislative Analyst’s Office, the Governor’s Council of Regional Homeless Advisors, and the State Auditor have recommended.
Eighty-five percent of Californians identify homelessness as one of the most important issues facing California. They are counting on all of us as elected, non-profit, and public sector leaders to take dramatic steps to solve homelessness. And that’s why our diverse coalition has come together to ask you to put the
state on the path toward solving it. We urge your consideration of this critical budget proposal.