Respect Poverty

To tackle homelessness, California grants $45M to build new housing

Homeless encampments block the street on an overpass of the Hollywood freeway in Los Angeles, in July 7, 2021.  Damian Dovarganes/ AP

Story at a glance

  • California has invested millions of dollars in Project Homekey, an initiative aimed at developing housing units for those experiencing homelessness.
  • Los Angeles and Sacramento were recently awarded $45 million in grants that will create 170 units of housing.
  • On any given day, 166,548 people experience homelessness in the state of California.

California has the highest number of people experiencing homelessness in the country and the state is investing millions of dollars in housing projects to try to get people off the streets and into homes.  

Gov. Gavin Newsom (D) announced on Tuesday that $45 million in grants would be given to two housing projects in Los Angeles and Sacramento that will result in 170 units of housing for people exiting homelessness.  

“California is moving with unprecedented speed to house people experiencing homelessness through Homekey. Behind every grant award we make for Homekey is the story of a Californian who will no longer have to sleep in a tent, in a car or on the street – these 170 units represent a fresh start for our most vulnerable residents,” said Newsom in a statement. 

Project Homkey is a $12 billion initiative launched by Newsom that aims to create permanent housing in apartment buildings and hotels for people who are homeless or at risk of being homeless. The program began in 2020 and thus far has awarded $323 million for 1,208 units across 14 projects in California. 


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The program proved so successful that Newsom announced a $2.75 billion expansion of the program in September 2021, with hopes to convert more hotels, motels, vacant apartment buildings, tiny homes and other properties into 14,000 more permanent, long-term housing units. 

“California is moving with unprecedented speed to house people experiencing homelessness, through Homekey,” said Newsom in September. “We are going all in on solutions that work – tackling the homelessness crisis head-on with a constructive, compassionate approach and a focus on serving those with the most acute behavioral health needs.” 

Tuesday’s announcement said the Housing Authority of the City of Los Angeles has been awarded more than $21 million for the acquisition of a newly constructed apartment building located near a transit station, pharmacy, library, grocery store and park. It’s expected to offer 78 permanent supportive housing units. It will also include on-site supportive services like individualized case management, income support, access to physical and behavioral health services, substance abuse treatment and eviction prevention. 

Similarly in Sacramento, the city has been awarded nearly $24 million to provide 92 permanent housing units through the acquisition of a hotel. It will also include on-site supportive services as well as education and employment services. This housing project will also feature life skills training, including financial literacy, household maintenance, nutrition and cooking and interpersonal communication and relationships.  

Newsom’s office said Project Homekey is expected to provide more than 55,000 new housing units and treatment slots in the coming years. The project is still accepting applications until funds are exhausted or by May 2, 2022, whichever comes first. 

Homelessness has hit a staggering high in the U.S., as the U.S. Department of Housing and Urban Development found on a single night in 2020, roughly 580,000 people were experiencing homelessness. Roughly 60 percent were staying in sheltered locations, like emergency shelters or transitional housing, while about 39 percent were in unsheltered locations, like on the street, in abandoned buildings and in other places not suitable for human habitation.  

Rates of homelessness vary across the country, but California maintains the highest, with approximately 166,548 total people experiencing homelessness on any given day.  


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