Opinion: Based On Past Results, Newsom's Latest Homeless Plan Likely Won't Work

By Kerry Jackson | Wayne Winegarden | Pacific Research Institute, Times of San Diego

April 11, 2023

Gov. Gavin Newsom kicked off his latest State of the State tour with a focus on homelessness. We wish his upbeat attitude inspired us, but it’s hard to have faith. In 2004, as mayor of San Francisco, he promised that he would end the city’s chronic homelessness in 10 years. As Governor, his proposals have been slight variations of his same failed approach as mayor. The results have not been any different.

Central to his agenda is an initiative to build 1,200 small homes around the state to temporarily shelter the homeless. The plan is to locate 500 in Los Angeles, 350 in Sacramento, 200 in San Jose and 150 in San Diego by this fall. We share the governor’s hope that these units will help address the heart-breaking conditions seen in homeless encampments. But hope is not a plan.

The governor also spoke at some length about spending. He noted that as recently as five years ago, the state’s spending commitment on homelessness was roughly $500 million, but now, at nearly $10 billion over 3 years, spending is several magnitudes higher.

While California’s homelessness troubles can’t be solved without financial resources, indiscriminate spending, just doing much more of what has been done before, will not solve this crisis. Nor will the problem be sustainably solved by tweaking previous scattershot efforts. Despite spending billions of dollars on homelessness relief, the numbers of people living on the streets continue to rise because, as our research shows, how the money is spent matters.

The governor’s Project Homekey program, for instance, has produced little or no results. In fact, homelessness has grown to over 171,000 people since the project was kicked off, first as Project Roomkey before the branding was changed. Back in 2019, prior to the surge in spending, there were a bit more than 151,000 homeless in the state. Why should we expect that spending more money on the same programs will deliver different results?

Both sides of the aisle in Sacramento have questioned the efficacy of homeless spending programs at a hearing at the State Capitol. Laura Friedman, a Democratic Assembly member from Burbank, recently said that “it’s very frustrating for the general public when they hear that in the state, we’re spending billions — and that’s billions with a B — of dollars on homelessness and housing, and yet they don’t feel that they’re seeing enough of an impact in their communities.”

With California facing a budget deficit of at least $22.5 billion this year, and February tax revenues falling over $1 billion short of forecasts, lawmakers need to be diligent in exercising their oversight powers and heavily scrutinize spending on homelessness programs. Programs that don’t work, and there have been plenty of them, need to be eliminated without delay.

Government programs often underperform because they fail to identify the difference in meeting the diverse needs of the homeless. While they have much in common, the homeless are still individuals and they have to be treated that way. The successes we’ve seen in the private sector, in Father Joe’s Villages in San Diego and Saint John’s Program for Real Change in Sacramento, are because these organizations tailor care to produce the best results for the homeless. The resources are well spent.

The governor said that the state is on a path to reduce the number of unsheltered homeless in the state by 15% in two years. That’s both ambitious — and unlikely. In fact it’s downright impossible if the response continues to be money spent on programs that, based on the documented experience, do not work.

Kerry Jackson is a fellow with the Center for California Reform at the Pacific Research institute and Dr. Wayne Winegarden is a PRI senior fellow in business and economics. Read their study “Project Homekey Provides No Way Home for California’s Homeless.”

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