Final State Budget Makes Progress but Fails to Meet Scale of Housing Needs, Emphasizing Need for Renewed Advocacy Ahead

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Late last week, Governor Gavin Newsom announced that the 2022-23 state budget agreement has been finalized. This budget includes key investments for affordable housing and homelessness solutions that can make some progress toward addressing the needs of our communities; however, the budget overall falls short, failing to meet the scale needed to meaningfully address our state’s affordable housing shortage. We will have to ramp up a renewed budget advocacy campaign to improve on the investments from this year for the 2023-24 state budget.

Key Takeaway

The final budget includes a total of $2 billion for affordable housing solutions, a fraction of an investment when compared with the state’s historic surplus and what is needed to match our communities’ housing needs. Again, we are shown with this budget that a lack of available funding is not the issue; instead, we need to build greater political will and motivation with lawmakers so that they see the value in putting our neighbors and communities first.

NPH, alongside our partners and allies, will continue to advocate tirelessly for our policy and budget priorities, which are the priorities of our communities: affordable, safe, and stable housing. 

NPH embraces and advocates for a “housing first” agenda in order to meet the unmet needs of state residents, who desperately need bold, decisive action that will tackle head-on the urgent need for housing and homelessness solutions today.

Our Priorities Moving Forward

At the top of our list is advocating that the thousands of approved, shovel-ready affordable homes waiting for financing get the funding needed to proceed to completion. Each one of these is a potential home for the millions of lower-income families and workers on waiting lists for housing throughout California. The state must do more in future budgets to get this housing built for the Californians who desperately need it and simply cannot wait any longer.

We’ll also continue to lead efforts in strong support of smart and efficient streamlining measures. Legislation like AB 2011 (Wicks) [Provides more housing opportunities and grows the middle-class workforce]; SB 1336 (Wiener) [Makes it easier for faith-based institutions to build apartments or condos on excess land they own]; and AB 2244 (Wicks) [Allows faith-based institutions to use their land for affordable housing by amending parking lot requirements] are just some of the bills we are championing that can promote deeper partnership and new opportunities with state and local government, in turn maximizing the impact of homelessness solutions and affordable housing investments. We will continue partnering with our elected leaders to pass these bills this year.

What’s In The Budget?

The following are the key affordable housing and homelessness solutions investments included in the final 2022-23 state budget:

AFFORDABLE HOUSING 

Homeownership

  •  $500 million to establish the California Dream For All Program to make homeownership more achievable for first-time homebuyers. According to Assembly budget staff, the $500 million in General Fund resources may enable up to 4,000 homebuyers to participate in the program.

HOMELESSNESS RESPONSE

  • Prevent Homelessness
    • $150 million  for Homekey 2.0 (Project Homekey) in the current year
    • $500 million over two years to house unsheltered individuals on state-owned land through grants to local governments for interim housing and site preparation
    • $1 billion in 2023-24 for the Homeless Housing, Accountability, and Prevention Program (HHAPP)
    • $39.5 million General Fund in 2022-23 and $37.7 million ongoing thereafter for future budget appropriation, pending the adoption of statutory changes regarding CARE Court
    • $30 million in 2022-23 to increase funding for legal aid for eviction protection
  • Transitional Housing
    • $1.5 billion over two years for immediate, clinically enhanced bridge housing solutions for individuals experiencing homelessness with serious mental illness and state operations resources for the Department of Health Care Services (DHCS) to implement the project and provide technical assistance to counties
    • $700 million for Encampment Resolution grants over two years to help local governments with resolving critical encampments and transitioning individuals into permanent housing, including a set aside for encampments on the state right-of-way

What’s Next?

The work on next year’s budget begins the day this year’s budget gets signed into law. NPH will continue to work diligently with our partners and allies, making the case for affordable housing and pressuring our lawmakers to prioritize the future of our communities, especially for low-income communities and communities of color who continue to be disproportionately impacted by our state’s housing shortage. The families of today and the next generation are depending on these efforts so they can be safe and thrive in our state. Having a safe, stable, and affordable place to live is the foundation for this future.

What Can I Do Now?