California state and local leaders are in the midst of a dispute over who deserves credit for recent declines in homelessness and what should happen next, as counties warn that state budget cuts could undermine the very programs showing success.
Gov. Gavin Newsom has been quick to claim victory as preliminary data shows homelessness decreasing in multiple California communities, saying his administration is "reversing decades of inaction on homelessness." But the California State Association of Counties fired back, accusing Newsom of jeopardizing that progress by slashing state funding for the programs they say are most responsible for the improvements.
The conflict centers on competing narratives about California's approach to its homelessness crisis, which affects more than 187,000 people statewide. While both sides agree that some communities are seeing promising declines, they disagree sharply on strategy, funding and who should take responsibility for results.
Point-in-time counts conducted earlier this year show encouraging trends in several major California regions.
According to preliminary data from the governor's office, Los Angeles County showed a 9.5% reduction in unsheltered homelessness, while Los Angeles City reported a 7.9% decrease. San Diego saw a 6.6% decline in total homelessness, with San Diego City recording a 13.5% drop. Other communities reporting decreases include Riverside County, San Bernardino County, Sonoma, Ventura and Tulare counties. Santa Cruz County saw a 20% drop, counting 1,473 people compared to the previous year. Contra Costa County recorded a 26% decrease.
"I have been clear that I expect every community to address encampments and help get people off the streets and the support they need," Newsom said in a statement. "My administration has provided unprecedented support. Addressing encampments means more than just sweeping them up, which is why California has developed a comprehensive and effective approach."
The governor's office emphasized that California limited its overall homelessness increase to just 3% in 2024, compared to a national increase of over 18%. The state held growth of unsheltered homelessness to 0.45%, while the national increase was nearly 7%.
Newsom's administration points to a multi-pronged approach that includes addressing mental health impacts on homelessness, creating new legal pathways through conservatorship reform and CARE courts, streamlining housing development, and providing shelter and support while removing dangerous encampments.
The administration also highlighted voter approval of Proposition 1 in 2024, which provides a $6.4 billion bond for behavioral health treatment and housing for veterans and people experiencing homelessness.
But declines were not universal and county leaders argue that the state's approach has been fundamentally flawed and that recent progress is now at risk due to budget cuts.
"We agree with the governor: Thanks to years of hard work on the ground, counties and cities are showing results," said Jeff Griffiths, California State Association of Counties president and Inyo County supervisor. "But now, because of the new state budget, local governments will be forced to defund successful efforts making real progress."
The dispute focuses heavily on the Homeless Housing, Assistance and Prevention program, which provided $1 billion in funding last year but was cut to zero in the current budget. Newsom has signaled intent to allocate $500 million for the program next year.
Counties say this on-again, off-again funding approach makes it impossible to build sustainable programs. Historical HHAP funding shows the volatility: $650 million in 2019-20, $300 million in 2020-21, then $1 billion annually from 2021-22 through 2024-25, before dropping to zero for 2025-26.
In the last funding round the Los Angeles region received $380,361,330.80 spread over seven applicants.
"For years, the state has thrown one-time money at this problem without any real strategy," Griffiths said. County officials argue that the unpredictable funding prevents local governments from making long-term investments in permanent solutions.
The counties have released their own comprehensive proposal called the AT HOME framework, which would create clear responsibilities for each level of government and provide reliable, ongoing funding rather than one-time grants.
Counties also dispute Newsom's claims about state spending on homelessness. While the governor's office says the state has spent $27 billion to address homelessness, county analysis found that roughly half of awarded funds went to housing development rather than direct homelessness services.
The counties note that local governments received much less funding than housing developers, with counties getting $7 billion over six fiscal years — barely $1 billion annually spread across 58 counties.
Despite the positive trends in many communities, challenges remain. Santa Cruz County, while seeing an overall 20% decrease, reported an increase in "chronically homeless" people — those who have been homeless for a year or more and have a disability. Santa Clara County, which conducts counts every other year, saw an 8% increase from 2023.
Santa Monica bucked the regional trend, with homelessness increasing 5% to 812. The city's increase was driven primarily by a rise in vehicle camping and more people in shelters).
Experts caution that point-in-time counts are estimates at best and likely undercount homeless populations.
The Los Angeles Homeless Services Authority (LAHSA), who oversee local homeless counts, has been under siege recently following accusations of fiscal mismanagement and longstanding complaints over its accuracy. Los Angeles County Supervisor Lindsey Horvath proposed creating a new county department to replace LAHSA and the organization's CEO resigned after the County pulled its $300 million contract from the agency.