Evidence Likewise Calls California’s “Housing First” Homelessness Strategy into Question

By Vanessa Brown Calder and Jordan Gygi of Cato. Excerpt:

"A recent Cato blog examined the effects of Utah’s “Housing First” policy, which aims to provide the chronically homeless with permanent housing without requiring treatment for mental health issues or substance use disorder. The Biden administration recently unveiled a new federal plan to address homelessness that rests on this philosophy, so the outcomes in Housing First states are worth considering. Unfortunately, in Utah, the original “Housing First” state, data indicates that chronic homelessness and overall homelessness have grown significantly two decades after policy implementation.

California is another state that put Housing First at the center of its homeless policy response, and the state provides another case study. California began its foray into Housing First policy when San Francisco implemented a policy based on Housing First principles called “Care not Cash.” Then‐​County Supervisor Gavin Newsom pushed the policy, which diverted funding away from cash benefits for the homeless and towards building permanent housing and shelters.

Then, in 2016, California adopted Housing First statewide. As a result, California now requires any state‐​funded homeless program to abide by the principles of Housing First, including allowing tenants to stay housed regardless of substance use. Governor Newsom revamped these efforts in 2020 with the introduction of Project Homekey, a program that aims to convert existing buildings into permanent supportive housing.

These efforts have proven expensive, and California has spent $3.7 billion on the Homekey program since announcing it in 2020. Cities are spending millions of their own money as well: San Diego spent over $62 million on permanent supportive housing between 2010 and 2018, significantly more than the $30 million it spent in that same period on homeless shelters.

However, despite the significant funding commitment, California’s chronically homeless and homeless population continues to grow. Chronic homelessness in California fell by 51 percent between 2005 and 2016 (see Figure 1), but the trend reversed after 2016, the year Housing First was implemented statewide. Between 2016 and 2022, chronic homelessness increased by 93 percent, reaching levels not seen since 2005."