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key takeaway

California voters will decide on March 5th, 2024, whether to pass Proposition 1, a two-part initiative aiming to improve access to behavioral health services. This includes funding for treatment facilities, housing support, and changes to the Mental Health Services Act.

Millions of Californians who cope with behavioral health conditions — mental illness or substance use disorders — rely on services and supports that are primarily provided by California’s 58 counties. Improving California’s behavioral health system is critical to ensure access to these services for all Californians, regardless of race, age, gender identity, sexual orientation, or county of residence.

In recent years, state policymakers have launched various initiatives to transform California’s behavioral health system with the goal of improving access for Californians. The most recent of these initiatives is Prop. 1. Last year, state policymakers passed, with strong support from Governor Gavin Newsom, Senate Bill 326 and Assembly Bill 531. Together, these bills placed Prop. 1 on the March 2024 ballot.

On March 5, 2024, California voters will vote on Prop. 1, a two-part measure that would 1) amend California’s Mental Health Services Act and 2) create a $6.38 billion general obligation bond. The bond would fund:

  • Behavioral health treatment and residential facilities,
  • Supportive housing for veterans and individuals at risk of or experiencing homelessness with behavioral health challenges.

This initiative presents beneficial aspects as well as potentially adverse consequences for Californians. This Q&A provides a high-level overview of Prop. 1, including how Californians with behavioral health conditions might be impacted by its passage as well as implications for the state budget.

Key Terms

Why Does Prop. 1 Matter for Californians?

Prop. 1 would impact how many Californians access mental health services and substance use disorder treatment in their communities. It would restructure a key funding source for county behavioral health services in ways that would increase housing supports but might adversely impact counties’ ability to provide behavioral health services.

The Mental Health Services Act (MHSA), which Prop. 1 would amend, accounts for about one-third of funding for county behavioral health services. The MHSA is essential in supporting services for Californians across different ages, addressing a spectrum of mild to severe behavioral health conditions.

Prop. 1 would also authorize a statewide bond to create mental health and substance use treatment beds, and housing with supportive services for unhoused Californians with behavioral health challenges. Increased supportive housing and access to treatment facilities is crucial for Californians. Capital funds accessed through the bond portion of Prop. 1 will slightly impact the state’s ability to make budgetary decisions year-to-year. However, the capacity of the state to issue future voter-approved bonds will decrease because California has a limited ability to finance bond measures.

Changes to the MHSA will impact a system that currently supports all Californians with behavioral health conditions. In contrast, the bond focuses on individuals with behavioral conditions who are at risk of or experiencing homelessness, which is a smaller portion of the unhoused population.

As thousands of Californians across the state experience the devastating effects of homelessness and barriers to behavioral health care, policymakers are asking Californians to consider if redirecting MHSA funds and authorizing a new general obligation bond is the right approach to addressing the state’s behavioral health and homelessness crises.

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What Problem Is Prop. 1 Trying to Address?

Prop. 1 aims to support Californians who are most affected by severe behavioral health conditions (mental illness and substance use disorders) and homelessness. This initiative is designed to create designated funding for mental health services and housing or treatment units for people with behavioral health conditions who are or at risk of experiencing homelessness.

In early 2023, over 181,000 Californians were counted as experiencing homelessness — the traumatic effects of which can seriously harm individuals’ well-being. Research suggests the trauma of experiencing homelessness can cause people to develop mental health problems and worsen existing behavioral health challenges and coping behaviors like substance use.

There are data challenges in quantifying exactly how many unhoused Californians have a mental health condition or substance use disorder. The 2023 homelessness point-in-time count showed 25% of the 181,399 people experiencing homelessness in California had a severe mental illness and 24% had a substance use disorder. However, while there is likely overlap between these individuals, the full extent is not reported.

Access to mental health care and substance use disorder treatment can be challenging for Californians who are unhoused. A recent statewide study found that nearly 4 in 5 unhoused Californians surveyed reported experiencing a serious mental health condition at some point in life, and those with current mental health conditions reported limited access to treatment. Additionally, 1 in 5 unhoused Californians who reported regular substance use and wanted treatment were not able to receive it.

These challenges are compounded by California’s shortage of adult psychiatric and community residential beds, which prevents Californians with serious behavioral health conditions from accessing critical behavioral health services.

What Is the Mental Health Services Act?

In 2004, California voters approved the Mental Health Services Act (Prop. 63), which created a 1% surtax on personal incomes above $1 million to provide increased funding for mental health services. Its passage signified a commitment to improving mental health outcomes for Californians, with a focus on prevention, early intervention, and community-based care. This tax supports about one-third of the state’s public mental health system.

The Mental Health Services Act has five main goals:

How Are Mental Health Services Act Funds Used Today?

The majority of MHSA funding (95%) goes directly to counties, which have some flexibility in how to use these funds.

Under current law, a small percentage of MHSA dollars (5%) is reserved for state-level administration.

How Would Prop. 1 Change Mental Health Services Act Spending?

Prop. 1 proposes significant revisions to the Mental Health Services Act (MHSA). These include:

  • Changing its name to the Behavioral Health Services Act (BHSA),
  • Expanding its scope to encompass treatment for substance use disorders.

Additionally, it would modify how MHSA funds are allocated, and introduce changes related to oversight, accountability, and the community planning process. This overview will focus on outlining the new funding structure under Prop. 1.

Under Prop. 1, counties would continue to receive the bulk of BHSA funds (90%). However, the allocation across different spending categories would change, without an increase in revenues. Counties would allocate their BHSA funds as follows:

Prop. 1 could provide some exemptions for counties with a population of less than 200,000. In addition, during the first two years of implementation, counties might have the flexibility to transfer up to 14% of their funding between these categories, with a limit of 7% per category. However, this flexibility is still pending state approval and has not been confirmed.

Another notable change is that Prop. 1 would shift a small percentage of dollars from counties to the state (from about 5% of total MHSA funding to about 10%). This would result in about $140 million annually redirected to the state budget. However, this amount could be higher or lower depending on the total amount of revenue collected from the tax.

Prop. 1 would also revise the allocation of state-level funds:

  • At least 3% to the Department of Health Care Access and Information to implement a statewide behavioral health workforce initiative.
  • At least 4% to the California Department of Public Health for population-based mental health and substance use disorder prevention programs. A minimum of 51% of these funds must be used for programs serving Californians who are 25 years or younger.

It’s worth noting that Prop. 1 would not change the tax on people with incomes over $1 million per year. This means counties would be expected to expand their scope of services without an increase in revenue. In fact, county leaders have repeatedly raised concerns about the disruption that Prop. 1 could cause. Specifically, the MHSA restructuring could result in significantly less funding for core services, which could lead to counties:

  • Canceling contracts with community-based organizations. 
  • Closing programs that are currently serving Californians.
  • Reducing county staffing.

If passed, the exact impact of Prop. 1 will vary by county and depend on how much revenue is collected in any given year. It’s important to keep in mind that the MHSA funds services for Californians of all ages for a range of conditions — mild to moderate to severe. The restructuring of MHSA funding would target a subset of this population. Therefore, programs and services for prevention and early intervention in some counties, for instance, could experience disruptions due to the new prioritization of funding.

What Can We Expect from the Behavioral Health Infrastructure Bond?

The Behavioral Health Infrastructure Bond would create a $6.38 billion general obligation bond for:

  • Infrastructure development of treatment and residential care facilities,
  • Supportive housing units for veterans and other Californians with serious mental health conditions and substance use disorders.

These funds are estimated to create up to 4,350 housing units, with 2,350 set aside for veterans, and 6,800 mental health and substance use treatment places for an approximate total of 11,150 new behavioral health and supportive housing units statewide. An estimated 26,700 outpatient treatment slots will also be created that may serve thousands of Californians annually.

Projects funded by the Behavioral Health Infrastructure Bond will be eligible for local streamlined review processes if they meet select criteria. The bond funds will be allocated as follows:

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What Would the Infrastructure Bond Mean for the State Budget?

Under Prop. 1, the state would issue up to $6.38 billion in general obligation (GO) bonds, with the funds going toward:

  • Grants or loans for vital treatment and residential care facilities,
  • Supportive housing units.

California voters have a record of funding large infrastructure projects through bonds as it does allow the state to access impactful funding amounts that are designed to serve public interests at large over many years.

In issuing bonds, the state must repay the bond debt service (which is the principal bond amount plus interest) through General Fund dollars. The most recent cost estimate assumes a 30-year debt service resulting in projected payments of roughly $310 million per year. Under this estimate, it would cost the state approximately $9.3 billion to repay the total bond debt, not including the cost of inflation. California currently spends roughly 2.5% of the state budget on repaying various bond obligations voters have decided on in the past.

While there are ways to equitably reform the state budget’s revenue streams, policymakers must balance the yearly limited discretionary flexible dollars in the General Fund. GO bonds in essence prioritize increased debt-service payments to be drawn from the General Fund over potential ongoing or one-time funding. Repaying the bond portion of Prop. 1 is a trade-off that will slightly reduce the flexible dollars left for other vital public services that may already serve Californians with behavioral health conditions and those at risk of or experiencing homelessness. It also challenges the state’s capacity to fund future voter-approved bonds since California has limitations on financing bond measures.

Another consideration is the ongoing operating costs that will be needed to adequately sustain the facilities produced through Prop. 1. As explained above, the MHSA restructuring does designate 30% to housing interventions which includes rental and operating subsidies. The funds can presumably help sustain facilities that are projected to be secured through the bond funding. However, it is uncertain whether these funds and those from other sources will be sufficient and accessed efficiently to ensure adequate upkeep, staffing, and proper care for the Californians receiving housing and services through these projects.

The infrastructure projects funded under the bond would build on existing state programs that received one-time funding through previous budget allocations or voter-approved bonds which are close to being depleted.

How Might Californians Be Impacted by Prop. 1?

The proposal presents various promising aspects. First of all, the expansion of services to substance use disorder treatment is positive. This broadened scope recognizes that mental health challenges and substance use disorders sometimes occur together. In fact, more than 1 in 4 adults living with a serious mental illness also have a substance use disorder. This underscores the importance of providing treatment for both conditions.

Another positive aspect of this proposal is the prioritization of treatment facilities and supportive housing infrastructure for Californians at risk of or experiencing homelessness with behavioral health conditions. Due to racism, ableism, and other forms of discrimination, some Californians are more likely to experience the devastating effects of homelessness at some point in their lifetime. This disparity is particularly stark for Black, Indigenous and Pacific Islander Californians, adults without children, older adults, and transgender and other LGBTQ+ individuals.

Notably, the new investments and prioritization of funds under Prop. 1 target a small but important share of the unhoused population. The majority of unhoused Californians face short-term homelessness (61%), for which deeply affordable permanent housing is needed. For those who are chronically homeless (39%) and may have behavioral health challenges, the increased supportive housing units are crucial if they are appropriately sustained with wraparound supportive services.

One concern about Prop. 1 is the restructuring of funding under the Mental Health Services Act (MHSA). While the exact consequences of this change are not entirely clear for each county, it could have adverse effects. The MHSA has been instrumental in providing innovative, community-based services for historically underserved communities, including people of color and LGBTQ+ communities. Given that county leaders have expressed that this initiative could result in less funding for core services, Prop. 1 could negatively impact services for Californians of color and LGBTQ+ communities that are currently supported by MHSA funding.

A key flaw of this initiative is that it expands the scope of the MHSA and prioritizes funding for people who are or at risk of experiencing homelessness without increasing the tax or providing new revenue to support existing county behavioral health programs. This approach is concerning, as it redirects funds originally allocated for a specific purpose to address a different need.

What Are Supporters and Opponents Saying?

supporters

Supporters claim that Prop. 1 would prioritize existing funds and generate new funds for Californians with the most severe behavioral health needs and those living in encampments. Other supporters assert that the proposition is a beneficial component in advancing the variety of interventions needed to address California’s housing and homelessness challenges. Supporters of Prop. 1 include California Big City Mayors as well as some behavioral health and housing advocates.

opponents

Opponents, including disability rights advocates and peer support advocates, argue that Prop. 1 represents a significant regression in the treatment of mental illness and substance use disorders, likening its impact to a 50-year setback. This perspective stems from allowing funding to be used for involuntary or forced treatment facilities. Opponents also claim that Prop. 1 could result in reduced mental health services for Black, Indigenous, and other people of color and LGBTQ+ Californians.

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key takeaway

In February 2022, there were 437 unhoused Californians per 100,000 Californians statewide — the Los Angeles and South Coast region and the San Francisco Bay Area having the highest shares of unhoused individuals in California.

Having a place to call home is the most basic foundation for health and well-being no matter one’s gender, race, or zip code. But thousands of Californians in all areas of the state fall into homelessness and experience its devastating health, economic, and intrapersonal effects daily.

Homelessness in California is a statewide challenge that affects individuals in every region and county — rural, suburban, and urban alike. In February 2022, the Los Angeles and South Coast region (49.9%) and the San Francisco Bay Area (22.2%) had the highest shares of unhoused individuals, based on point-in-time data, followed by the Sacramento Region (7.2%) and the Central Valley (7.1%). Smaller but notable shares of unhoused Californians reside in the Central Coast (4.7%), Inland Empire (4.5%), Far North (4.0%), and the Sierra Nevadas (0.5%).

Higher concentrations of unhoused Californians typically reflect the denser overall populations in their respective regions. For example, Los Angeles County alone is home to more than 40% of unhoused Californians in part due to its dense population, high living costs, and insufficient affordable housing — which is the primary driver of homelessness regardless of geographical region. Regions with denser, urban populations also tend to have more robust homelessness support and delivery systems which can better track the number of unhoused residents living in sheltered and unsheltered spaces.

A map showing the share of unhoused population by state region in February 2022 where most unhoused Californians reside in Los Angles, south coast region, and the San Francisco Bay Area.

Another way to understand the magnitude of homelessness across the state is per capita — or per 100,000 Californians — by region. Homelessness per capita shows the prevalence of being unhoused at a point in time across regions with varing population sizes. For instance, per capita measures provide better insight into the magnitude of rural homelessness which can appear less notable through point-in-time counts. It also puts into perspective the number of unhoused residents in more densely populated regions where homelessness is typically more visible.

In February 2022, California had 437 unhoused people per 100,000 residents. The Far North had the highest per capita unhoused population with 647 unhoused residents per 100,000 residents in the region, followed by the Central Coast (540 per 100,000), despite these regions having among the lowest statewide shares of unhoused Californians. In contrast, the San Francisco Bay Area (503 per 100,000) and Los Angeles and the South Coast (477 per 100,000) regions rank closer to the statewide average in prevalence, despite ranking the highest by share. Homelessness was less prevalent in the Sierra Nevada, Central Valley, and the Inland Empire regions which aligned with their lower shares of unhoused Californians.

A bar chart showing unhoused Californians per 100,000 residents by region in February 2022 where California's far north region has the highest number of people experiencing homelessness per capita.

Comprehending the prevalence of homelessness, both in terms of regional share and per capita rates, is crucial to understanding how homelessness is affecting communities statewide. However, regardless of geographical region, effectively addressing homelessness requires us to continue building the capacity and resources required to meet the housing needs of Californians experiencing or at risk of homelessness.

Fundamentally this begins with deeply affordable housing, supportive services, rental assistance, and eviction prevention, all of which are evidence-based interventions the pandemic showed us state policymakers can rapidly mobilize to help people exit homelessness and stay in their housing.

Statewide planning and policy interventions need to also address the inequities among populations that disproportionately experience homelessness — within all regions of the state. These include Black, American Indian or Alaska Native, Pacific Islander, and increasingly Latinx Californians alongside adults without children, older adults, and LGBTQ+ individuals.

Above all, ending homelessness statewide is possible with persistence and sustained commitments by policymakers that represent all regions of California. By funding at-scale and permanent solutions, state leaders can ensure every Californian has a place to call home.

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key takeaway

Homelessness among Latinx Californians has increased by 22% since 2020, more than three times the overall state increase of 6.2% over the same period.

Every Californian deserves a safe and stable place to call home. Yet, more Californians are pushed into homelessness faster than our systems can house them. From 2020 to 2022, the total number of unhoused Latinx Californians increased by 22% — a trend reflected in a rise in both sheltered and unsheltered homelessness. Overall, California’s total unhoused population during the same point-in-time counts increased by 6.2%. This increase mainly reflected a rise in sheltered populations.

A column chart showing the the number of Californians experiencing homelessness at a point-in-time in 2020 and 2022 where Latinx Californians experiencing homelessness rose by 22%, which is more than three times the overall state increase.

The sharp increase in unhoused Latinx Californians likely results from the inequitable compounding effects of the pandemic which exacerbated the economic and housing insecurity many communities of color already faced. Latinx Californians experienced high rates of housing hardship and unemployment and disproportionately worked in essential, low-wage occupations.1Aureo Dias Mesquita and Sara Kimberlin, Who is Experiencing Housing Hardship in California? (California Budget & Policy Center, May 2022); Sara Kimberlin and Alissa Anderson, In Good Times and Bad, California’s Black and Latinx Workers Bear the Burden of Unemployment (California Budget & Policy Center, December 2022); Sarah Thomason and Annette Bernhardt, Front-line Essential Jobs in California: A Profile of Job and Worker Characteristics (UC Berkeley Labor Center, May 2020). They also confronted higher rates of COVID-19 infections and deaths during the first year of the pandemic, before COVID-19 vaccines and treatments were available.2Adriana Ramos-Yamamoto and Monica Davalos, Confronting Racism, Overcoming COVID-19, and Advancing Health Equity (California Budget & Policy Center, February 2021). Combined, the pandemic’s deep economic and health ramifications made families and individuals more susceptible to not being able to afford their homes.

While all unhoused populations are generally undercounted, research shows that unhoused Latinx individuals are specifically underreported due to distinctive factors. Stronger reliance on social networks, lower utilization of homeless and public services due to information and service gaps, language barriers and mistrust, and increased likelihood of residing in nontraditional homelessness spaces or overcrowded housing means they are less likely to be captured in standardized counts.3Melissa Chinchilla et al., Increasing Latino Homelessness— What’s Happening, Why, and What to Do About It (National Alliance to End Homelessness and the Homelessness Research Institute, January 2023); Melissa Chinchilla, Stemming the Rise of Latino Homelessness: Lessons From Los Angeles County (UCLA Latino Policy & Politics Initiative, 2019). Therefore, the trending increase in Latinx homelessness may signify an even larger, unseen need among this community.

As many Californians continue to struggle to stay in their homes or exit homelessness, policymakers need to keep investing in the evidence-based solutions that we know can end homelessness. These solutions require at-scale, ongoing investments in California’s homelessness response systems and expanding the stock of affordable housing. Without this, the stark racial disparities we already see in our state’s unhoused population will continue to grow alongside Californians who are pushed into homelessness daily because they cannot afford to stay in their homes.

Policy solutions should also be rooted in equitable interventions that build community trust and integrate culturally and linguistically competent practices. Ending homelessness for all Californians is possible if policymakers use the levers at their disposal to ensure everyone has a place to call home.

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Having a place to call home is the most basic foundation for health and well-being no matter one’s age, gender, race, or zip code. But many thousands of individuals in California each year experience homelessness and its destructive effects. Polling shows that Californians continue to rank homelessness as one of the most serious challenges facing the state, and policymakers have paid increasing attention to this issue in recent years. Understanding the scale, impact, and drivers of homelessness in California can help guide effective policy solutions and action to end this crisis.

How does homelessness affect the people who experience it?

Homelessness has devastating effects on the individuals who experience it because having a home is a basic necessity to maintain health, work, school, and dignified living conditions. Lack of stable housing seriously disrupts individuals’ ability to obtain or keep a job or to make sure that children are able to attend and focus on school. Homelessness exposes individuals to serious health risks and makes it difficult to take care of one’s health and access health care, and therefore homelessness can exacerbate chronic or acute health conditions. In fact, adults experiencing homelessness often have health problems and difficulty with daily living activities that are more typical of people 20 years older. Unhoused individuals have also faced serious health risks throughout the COVID-19 pandemic.

This devastation to people’s lives is why homelessness in California is a crisis that requires urgent attention by federal, state, and local leaders.

The stress of homelessness can also seriously harm individuals’ mental well-being. Research shows that the trauma of experiencing homelessness can cause people to develop mental health problems for the first time and can worsen existing behavioral health challenges. Longer time spent without a home is linked to higher levels of mental distress and more damage from coping behaviors like substance use.

This devastation to people’s lives is why homelessness in California is a crisis that requires urgent attention by federal, state, and local leaders.

How many people in California experience homelessness?

When Californians experience homelessness, urgent action is needed, because no one should be without a home. According to the most recent point-in-time data, as of January 2020 there were 161,548 people in California experiencing homelessness on a given night. The majority of these individuals – about 70% – were unsheltered, meaning that they were living on the street, in their vehicle, or in other places not meant to serve as homes. 

Another way to understand how many Californians experience homelessness is to consider how many people received homelessness services (like shelter or outreach) over the course of a full year. More than 270,000 homeless individuals across the state received some kind of services during calendar year 2021, and the total number receiving services likely increased the following year. This number is larger than the point-in-time number because many people who fall into homelessness at some time during the year return to stable housing relatively quickly, and the point-in-time count only captures the number of individuals experiencing homelessness on one night of the year.

Who experiences homelessness in California?

People of all ages and backgrounds fall into homelessness, and Californians experience homelessness in every county of the state. The majority of unhoused individuals are single adults, but an important share are also families with children and unaccompanied and parenting youth. A substantial share of single adults experiencing homelessness in California are older adults.

There are deep racial inequities in who experiences homelessness in California, with individuals who are Black facing a greatly disproportionate risk of homelessness, as well as American Indian or Alaska Native and Pacific Islander individuals. The number of Latinx Californians experiencing homelessness also increased substantially in the most recent point-in-time count. These disparities reflect the effects of structural racism and inequitable treatment and access to opportunities in education, employment, health, the justice system, and other domains.

In addition, there are disparities in experiences of homelessness by gender identity and sexual orientation. In terms of gender, the majority of unhoused Californians are male. Individuals who identify as transgender or gender-nonconforming are more likely than cisgender individuals to be unsheltered when they experience homelessness. Among youth, those who identify as LGBTQ+ are especially likely to experience homelessness, in many cases as a direct result of family rejection of their gender identity or sexual orientation.

MORE in this series

See our 5 Facts: Who is Experiencing Homelessness in California? to learn more about California’s diverse unhoused population.

What are the key drivers of homelessness in California?

Many systemic challenges rooted in classism, racism, and sexism that harm individuals and families put people at greater risk of becoming homeless at some point in their lifetime.

The severe shortage of affordable housing — particularly housing that is affordable to people with the lowest incomes — is the number-one driver of California’s homelessness crisis. For Californians with the very lowest incomes — those categorized as “extremely low-income” under the definition used for most state and federal housing policies — there were only 23 housing units that were affordable and available for every 100 renter households as of 2020. Statewide, an estimated 1.2 million new affordable homes are needed by 2030 to meet the housing needs of Californians with low incomes.

Because affordable housing is in such short supply in California, many renters with low incomes must pay much more than they can afford for housing, so that even a minor financial emergency can cause them to be unable to cover the rent and face the risk of eviction and homelessness. Black and Latinx renters are especially likely to face unaffordable housing costs, reflecting the effects of explicitly and implicitly racist policies and practices in housing, employment, and other arenas.

Other factors have also contributed to California’s homelessness crisis, including the decades-long trend of stagnant wages for lower-wage workers and past failure to fund adequate mental and behavioral health services to meet needs in the community. The shortage of deeply affordable housing, however, is a fundamental driver of the crisis.

What public systems and supports can address the needs of people experiencing homelessness or play a role in preventing homelessness?

Many different local, state and federal public systems and services intersect with homelessness in important ways. 

Nearly 1 in 8 Californians did not have enough resources to meet their basic needs, according to the most recent California Poverty Measure data. This reflects the high cost of living in many parts of the state. In addition, the share in poverty is expected to increase for 2022, as pandemic-era public supports like the expanded federal Child Tax Credit expired. For all individuals experiencing homelessness, public supports that help people meet basic needs are important both to prevent and exit homelessness. These supports include but are not limited to: cash supports like SSI/SSP and CalWORKs, refundable tax credits like earned income tax credits (EITCs) and child tax credits, nutrition assistance programs like CalFresh and WIC, and Medi-Cal health coverage.

While only a minority of unhoused individuals struggle with serious mental health or substance use disorders, behavioral health services are vital supports for maintaining stable housing over the long term for those individuals.

Among youth, abusive or neglectful family situations can cause young people to leave their homes and become homeless, pointing to a role for the child welfare system in preventing and addressing youth homelessness.

Domestic violence can also be the trigger that pushes individuals into homelessness, especially women and mothers with children. Services that directly address the experiences and needs of domestic violence survivors are important to prevent and address homelessness for these individuals.

The justice system has an impact on many unhoused individuals as well. This is both because of laws that criminalize homelessness (e.g., laws that make public camping punishable by citation or arrest) and because individuals who have a conviction record or are reentering the community after incarceration face daunting barriers to securing and maintaining stable housing. These factors compound challenges in helping individuals find safe, affordable housing.

What are effective, evidence-based ways to address homelessness? 

Extensive research shows there are several evidence-based approaches that are effective in helping people successfully exit homelessness and maintain stable housing. 

For all individuals experiencing homelessness, interventions that use a “housing first” approach have a strong track record of success. Housing first — as its name suggests — focuses on moving people into permanent housing as the first priority, before focusing on meeting other needs or connecting with other services.

For the minority of individuals who are chronically homeless and have serious physical or mental health challenges, supportive housing — or permanent housing paired with case management and support services — is an approach that research shows is effective in enabling individuals to exit homelessness and achieve housing stability. About one-third of Californians experiencing homelessness on a given night are chronically homeless with serious health challenges.

Having a place to call home is the most basic foundation for health and well-being no matter one’s age, gender, race, or zip code.

Housing vouchers, shallow rental subsidies, and targeted programs for specific subpopulations  — such as veterans, homeless youth, or domestic violence survivors — are additional tools to help individuals successfully return to stable housing.

Interim housing, like motel stays, emergency shelters, and tiny homes, can also be necessary short-term strategies to get people off the street so that they are not unsheltered. These options can contribute to solving homelessness if coupled with services that focus on moving individuals into permanent housing as quickly as possible.

State funding to address homelessness has recently increased, but the number of people experiencing homelessness did not decrease. Why is that the case?

Effectively addressing homelessness requires a system of housing and services with enough capacity and investment to meet the needs of all Californians who are experiencing homelessness in every region of the state. Building that capacity requires investing in proven effective approaches at a scale that meets the need — and then providing reliable ongoing funding so that effective efforts can be sustained. Partnership between the state, federal, and local governments is important to mobilize the resources needed for impact at scale.

California first dedicated significant state dollars to address homelessness only a few years ago, and state investments have primarily consisted of one-time funding. The 2021-22 state budget first included a multi-year commitment of $1 billion annually to support local homelessness efforts, with intent to continue “based on performance and need.” In addition, there were significant investments in housing supports for special populations, such as families with children, and support to acquire and develop housing specifically to meet the needs of individuals experiencing homelessness. The 2022-23 state budget further built on these investments, including maintaining the $1 billion support for local homelessness efforts and incorporating $1 billion to expand bridge housing for individuals experiencing homelessness with serious mental illness.

These recent increases in state funding have not been accompanied by a drop in the number of Californians experiencing homelessness. Why? The COVID-19 pandemic is a key factor. Both health and economic effects of the pandemic have directly affected homelessness services and put more individuals at risk of homelessness.

At the start of the pandemic, to protect the health of vulnerable individuals experiencing homelessness — and public health more broadly — policymakers and service providers pivoted remarkably quickly to implement new models of non-congregate shelter, with California leading the way in developing innovative new approaches. Launching these new models required significant up-front investment of time and funding, which was necessary in the short-term to protect the health of individuals, and is expected to produce sustained payoff by building a safer and more effective long-term model for interim housing.

At the same time, the economic effects of the pandemic have put more Californians at risk of falling into homelessness. Since the start of the pandemic, rents have increased significantly. Record-high inflation more generally has pinched household budgets, and Californians with the lowest incomes have been hit the hardest.

Given these significant pandemic headwinds, the recent increases in state funding to address homelessness have likely played several vital roles. These include preventing many unhoused Californians from experiencing severe health effects or dying from COVID-19; preventing a substantially larger increase in the number of Californians experiencing homelessness; and building California’s long-term capacity to address homelessness more effectively.

When addressing a complex challenge like homelessness — particularly in the shadow of a global pandemic — progress takes time, and sustained commitment by policymakers is critical. Maintaining and building on recent state budget investments to address homelessness, to meet the full scale of need, can enable California to achieve a functional end to homelessness. The experience of homelessness for Californians would then be rare, brief, and non-recurring for individuals and across communities.

At the same time, the widespread shortage of affordable permanent housing continues to drive Californians into homelessness. As a result, it is also critical to invest in expanding the state’s supply of affordable housing, especially rental housing affordable to households with the lowest incomes. Both housing development and tenant-based rent subsidies can play a role in making more housing available that is deeply affordable.

Bottom line: Ending homelessness is possible, but persistence is required. There are many opportunities for the state to leverage its resources to ensure all Californians have a home.


Support for this report was provided by the Conrad N. Hilton Foundation.

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