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Alexis Madrigal: Welcome to Forum. I’m Alexis Madrigal. There’s been a brutal math to our homelessness and housing crisis. The per-unit cost of building new housing for people who cannot afford to pay much rent is staggering. Developers have told us that it costs more than eight hundred thousand dollars a unit in San Francisco, and it’s not too much cheaper elsewhere in the Bay Area. So you want to house a thousand people? That’s eight hundred million dollars.
During the policy innovation boom of the pandemic, when governments were trying many new things, the Newsom administration hit on the idea of Homekey, a program that would provide grants to local jurisdictions to buy preexisting buildings and convert them into housing. Several billion dollars of grants went out. Thirteen thousand five hundred people now live at Homekey sites, but it’s not clear whether the state government or other entities have taken a clear-eyed view on what went right and wrong to improve the next round of legislation.
Now a new CalMatters investigation attempts to do so. We’re joined by one of its authors, Marisa Kendall. Welcome, Marisa.
Marisa Kendall: Thanks for having me.
Alexis Madrigal: We are also joined by Tomiquia Moss, who’s California secretary of the Business, Consumer Services and Housing Agency and also the founder and former chief executive of All Home, which is a Bay Area organization focused on ending homelessness and poverty. Welcome, Tomiquia.
Tomiquia Moss: Thank you so much for having me.
Alexis Madrigal: So, Tomiquia, maybe you could run us through sort of the argument for Homekey and how you hoped Homekey would work, or how the state government hoped Homekey would work.
Tomiquia Moss: Well, you know, I think it’s really important to recognize that Homekey really began as an emergency pandemic response, right? We wanted to get vulnerable Californians safely indoors as quickly as we possibly could. And so the goal was to rapidly create, at the time we started out with Roomkey, stable shelter for folks who were coming inside and who were exposed and vulnerable to COVID.
I remember I was not in state government at that time and how worried we all were as community advocates, right, that people were going to be exposed and dying on our streets. And so Roomkey transitioned into Homekey because we know how important it is to have interim housing, but it’s stabilizing to have permanent housing. So it began to convert those hotels, motels, and other properties into permanent long-term homes. And that was the innovation, frankly, the speed and the transition from interim to permanent.
Alexis Madrigal: Yeah. Do you think it’s been a success?
Tomiquia Moss: I do. I really do. And I think it for a couple of reasons. I think it is no small feat that more than twelve thousand homes were created through this program. And during the time that Homekey, from April twenty twenty when we launched that program, transitioned from Roomkey to Homekey, a hundred and sixty-two thousand people were housed.
And if we were not able to convert those homes into permanent homes, I really do think we would have had to return many of our neighbors back to the streets. So certainly there are outliers, but overall, the fact that government could work with local communities rapidly and do what our communities have been asking us to do for a really long time, to make sure that people could come indoors quickly and have supportive services and housing, I absolutely think this program was a success.
Alexis Madrigal: Yeah. Marisa, let’s bring you in here. You know, when you try to step back and kind of understand the impact of Homekey, I mean, three point eight billion dollars is a big program in housing and homelessness in the state. Can you just talk a little bit about what you found in the paper trail here between local jurisdictions and the state?
Marisa Kendall: So what we found is, you know, when Homekey worked, it did really work. That’s what people stressed to us. You know, when it worked well, projects were getting done within a couple months. Sometimes people were moving in. Things were getting off the ground really quickly. And in some cases, in places where they didn’t have any homeless housing of this type before and where these projects would not have gotten done without this funding.
But with that speed came some trade-offs. Some guardrails were let down in the interest of speed, and we found out there were trade-offs with that. So, you know, when projects didn’t work, sometimes they really went off the rails.
We found that projects involving about three thousand homes, which was roughly one in five that were promised by the program, weren’t finished by the end of last year. So, you know, roughly four in five were. And another two thousand units have people living in them on a temporary basis but haven’t yet been converted into the permanent housing that was the point of the program. And another ten projects were publicized but then later canceled for various reasons.
Alexis Madrigal: Yeah. So what do you think the main takeaway or the main patterns are? What are the lessons we want to draw from that?
Marisa Kendall: Yeah. I think one interesting lesson is, you know, if you remove some of the guardrails, you can build housing quickly. There are a lot of things standing in the way, a lot of bureaucratic hurdles and things like that. But there are trade-offs there.
Typical affordable housing projects are a lot slower. There’s a lot more funding involved. But because of all those layers of funding, you have things like banks loaning you money, you have low-income housing tax credit investors. All of those things make projects take longer and make them more complicated, but they also provide extra oversight. So there are extra eyes on the project making sure it stays on track, pointing out what things could go wrong.
And Homekey didn’t have that. So in some cases, you had projects that were underbudgeted, different things went wrong, and they couldn’t right the ship in a timely manner because they didn’t have all that extra oversight.
Alexis Madrigal: Although even with that extra oversight, it feels like sometimes they can’t right the ship either, and things still don’t get built. Tomiquia Moss, as the state looks at the next iteration of Homekey, Homekey Plus, I guess we’re calling it, what do you think should work differently? What should be kept from, as you described it, this kind of pandemic response measure that it was born as?
Tomiquia Moss: Yeah. I mean, I think it’s important just to also remember that we are talking about people, right? Certainly, we often talk about this work in terms of units and buildings, but these are people whose lives were saved because of this program.
I’ve been working at this for two decades in California, so I do think it’s important to have context when we are evaluating these programs. And I believe you’re going to have one of our evaluation partners from Turner on this call. But we certainly recognize that the evolution of this work is critical. We’ve been evolving Homekey since we started.
We’ve put in additional accountability measures. We’ve set aside escrow disbursements. We now work with our local governments to make sure that there are protections that these units will actually come to fruition.
And, you know, what to me is most exciting is that over the lifetime of these projects, more than a hundred and seventy-two thousand people will be housed permanently through this project.
So Homekey Plus allows us to continue to refine that accountability. I think my colleague is correct. We can always find outliers when you’re moving quickly. But, you know, people have been asking us to treat homelessness like a crisis for a really long time in California. And when we had our government and our community step up to work together to make sure, in fact, we were treating it with the urgency that it requires, we recognized that there are always going to be things that happen when you are streamlining processes and making sure you get resources out the door to bring people inside.
But we are very clear about embedding those accountability measures in the upcoming rounds of Homekey.
Alexis Madrigal: Yeah. I mean, do you think the urgency is still there on homelessness, or do you think the edge has been taken off by some of these programs and some of the urgency has ebbed away?
Tomiquia Moss: I think the urgency is there, and we still have to recognize that we live in a constrained environment. You know, we need to be making concurrent investments in homelessness where we’re looking at interim housing, we’re looking at homelessness prevention, and we’re looking at permanent housing.
And so often our communities are having to make choices around one intervention or the other because of those resource constraints. And I think the challenge that a lot of folks may not realize is, for every person that we house in California, three more folks become homeless at the same time.
So these are structural problems that we have to address. And I think the urgency is there, but we need to make sure that we don’t deflect from evidence-based practices using our Housing First principles and making sure that just because we’re still seeing unhoused people on our streets, we don’t abandon solutions that we know work.
Alexis Madrigal: Yeah. You know, an earlier Turner report on Homekey outcomes, and also the latest reporting from CalMatters on Homekey outcomes, both identify operational funding going forward for these projects as something that local jurisdictions are very worried about.
So what is your agency doing to kind of address the ability of these permanent supportive housing units to have operational funding so that they are able to continue housing the people now living in them?
Tomiquia Moss: You know, I often describe this problem as, you know, we build homes and then we don’t build them with windows and doors, right? Like, we have to make sure that we are aligning our capital investments with service dollars. That is a fundamental challenge in our model.
We are working really deeply with our counties to make sure that through Prop 1 reform and working on our BHSA reform, that we can integrate our services and capital investments to address homelessness.
I think for those who need permanent supportive housing, we need the commensurate services to ensure that folks can be successful in that housing. And that’s a structural challenge all across this country. That is not unique to California.
And I think it’s a policy issue that we would love to see the federal government respond to appropriately, where we’re not just making tax credits and bonds available, but we’re figuring out how to pair resources that come from our health and human services departments at the federal level, integrating those with HUD funding so that communities can actually have capital dollars and services dollars.
Alexis Madrigal: Do you think it’s been worked out for Homekey, though, or do more things need to be done?
Tomiquia Moss: I think there’s more to be done. I think we want to make sure that our developer partners have ongoing service dollars with these projects.
We’ve seen local jurisdictions step up in Los Angeles. We saw Measure A come on the ballot that really made sure that there’s an ongoing source of service dollars. Measure W in Oakland as well.
So it is this local and state partnership, right, where the state through Homekey was able to put forward these capital projects. We also then see local jurisdictions use their resources for services.
And then the last thing I’d say, Alexis, is, you know, when we issued our HHAP grants, we wanted to make sure that the HHAP funds that communities are utilizing go into our Homekey projects toward services. So you’re really getting that blend of capital and service investment.
Alexis Madrigal: Tomiquia Moss, secretary of the Business, Consumer Services and Housing Agency for California. Thank you so much. We’ll be back with more right after the break.
