March 24, 2021 (Updated Letter to Reflect Additional Support)
The Honorable Nancy Skinner, Chair The Honorable Phil Ting, Chair Senate Committee on Budget & Fiscal Review Assembly Committee on Budget State Capitol, Room 6026 State Capitol, Room 5019
Sacramento, CA 95814 Sacramento, CA 95814
The Honorable Anna Caballero, Chair The Honorable Wendy Carrillo, Chair
Senate Budget Subcommittee #4 Assembly Budget Subcommittee #4
State Capitol, Room 5052 State Capitol, Room 4167
Sacramento, CA 95814 Sacramento, CA 95814
The Honorable Joaquin Arambula
Chair, Assembly Budget Subcommittee #1 California State Assembly
State Capitol, Room 5155 Sacramento, CA 95814
The Honorable Susan Talamantes Eggman Chair, Senate Budget Subcommittee #3 California State Senate
State Capitol, Room 4052 Sacramento, CA 9581
RE: Ongoing State Funding to Reverse the Cycle of Homelessness
Dear Chairs Skinner, Ting, Caballero, Carrillo, Arambula, and Eggman:
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 161,548 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, just in Los Angeles, from causes attributable to homelessness.
People experiencing homelessness were over four times more likely to die from coronary heart disease, over 17 times more likely to die from a transportation-related injury, and over 36 times more likely to die from a drug overdose, as housed residents.
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 0.5% of the state’s total budget.
None of the state’s recent one-year programs have made the level of progress we need to reduce the number of people falling into and experiencing homelessness significantly. 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. And one-time funding prevents service providers from being able to scale their staffing and organizational capacity to offer consistent, maximum capacity to move more people into housing.
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 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 nationally and in California, even while homelessness among other Californians increased. Thirty years of studies shows providing people experiencing homelessness with housing and services reduces homelessness and leads to 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 a comprehensive strategy through a “Bring California Home Act” that 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. One such outcome would be reductions in racial disparities that result in Black and Indigenous residents 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 risk of homelessness among low-wage workers, and Californians with nowhere to sleep other than doorways and sidewalks near storefronts.
To generate $2.4 billion per year, we propose restoring the 1986 corporate tax rate for the corporations with profits of $5 million or more from business in the state. This increase would only impact 500 California businesses—one out of every 3,000+ businesses. Regardless of where a corporation is located, this higher rate would apply to corporations doing 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 small or medium-sized businesses, most responsible for recent economic growth, or businesses that are suffering during the pandemic. Moreover, because our corporate tax rate applies to corporations anywhere in the world, not just in California, our proposal would have no impact on where a corporation chooses to headquarter.
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, or a combination thereof, we request ongoing funding of $2.4 billion per year to “bring California home,” and 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, over 150 strong, 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.