Gavin Newsom takes tougher stance on cities not combating homelessness

California Gov. Gavin Newsom has cracked down on cities that fall short on housing. Now he wants to do the same with homelessness.

The state’s housing enforcement unit will expand to encompass homelessness, the Newsom administration told POLITICO ahead of an announcement Thursday.

The governor is effectively doubling down on his aggressive strategy to get more homes built, previously accusing local governments of exacerbating California’s housing shortfall. A state unit has launched lawsuits against cities like Huntington Beach over the issue as well as an unprecedented housing review in San Francisco, where Newsom formerly served as mayor.

The latest move also comes amid heightened scrutiny of Newsom’s homelessness efforts: A state audit last week found the government was not consistently tracking costs and outcomes of homelessness programs. The recent narrow victory for Proposition 1 — a $6.4 billion bond at the center of Newsom’s homelessness strategy — also signaled wider voter skepticism about the state spending its way out of the crisis.

The new move means more assistance for local governments and the threat of consequences like civil penalties or lost money — as when Newsom withheld hundreds of millions of dollars in 2022 — if cities and counties fail to meet obligations like approving shelters and funding outreach. The administration also wants to expand the terms of state-mandated housing plans to compel cities and counties to plan for the lowest-income Californians.

During a press conference Thursday outlining the plans and another round of grants to help cities and counties move people out of encampments — one of the programs the audit said California has been unable to track — Newsom said his administration would vet grant applications more rigorously, making sure cities and counties had clear plans.

“I’m not interested in funding failure any longer,” Newsom said, warning of consequences if local governments secure money and then misspend it.

“They sure as hell shouldn’t get another penny if they didn’t use the money wisely,” Newsom added. “I want to be sure ... [the staffers] that are scoring these look at those next applications and say ‘no thank you.’”

The threat of state consequences has shifted “the political calculus around housing,” Newsom’s deputy chief of staff Jason Elliott said in an interview on Wednesday. “That was a huge sea change in California housing policy,” and “hopefully the same theory is going to prove true here with homelessness.”

Sacramento Mayor Darrell Steinberg, who has been an ally for Newsom on homelessness, said in an interview that compelling cities and counties to plan housing for their lowest-income residents should move the needle.

“These proposals will move us farther toward a legal obligation to get more people off the streets and into housing,” Steinberg said.

The governor’s pledge for deeper accountability speaks to mounting public frustration that California’s homelessness crisis shows no signs of abating despite the Newsom administration spending enormous sums to get people off the street. California has allocated nearly $24 billion since 2018. Yet the numbers keep increasing, rising by 6 percent last year as more than 180,000 Californians experienced homelessness.

“The results are not what any of us want them to be,” Elliott said.

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