Why the state is failing to put a dent in homelessness

Despite spending billions on homelessness, governments and nonprofits have failed to put a dent in California’s population of city street-dwellers. Things won’t change until policymakers recognize that their current approach doesn’t scale and too often ignores the public’s interest in clean, safe streets.

In July, Gov. Gavin Newsom toured the Estrella Vista Apartments, a new affordable housing development in Emeryville. The visit allowed Newsom to highlight steps that the state, local governments and nonprofits are taking to tackle homelessness and the shortage of housing. It also gave him an opportunity to push back against President Trump, who has been weaponizing the homelessness issue against California Democrats.

But the Estrella Vista project epitomizes the problems with California affordable housing policy: Estrella Vista’s 87 units have an average construction cost of $736,239 and it took eight years from property acquisition to project completion. High costs and long development times are common for the kind of infill, transit-oriented projects California planners prefer.

Also, because affordable housing projects like Estrella Vista are often owned and operated by not-for-profits, they don’t generate property taxes for the counties, cities and school districts in which they are located. The project’s nonprofit developer, EAH Housing, will be able to obtain a welfare exemption freeing it from any property tax liability.

A more cost-effective solution to California’s housing would involve placing large volumes of manufactured homes in low-cost areas. Sites could be in economically distressed cities and towns or on undeveloped parcels in unincorporated areas. Cities with high land costs like San Francisco should be allowed to meet their affordable housing obligations by paying cities and counties in less expensive areas to host new developments. This approach could quickly produce the tens of thousands of new housing units we need to end street homelessness.

But don’t homeless people have a right to housing in the city in which they live? Not necessarily. Many homeless individuals have migrated from other states, attracted by the mild California weather, availability of services and permissive attitude of many cities. Others who may have once owned or paid rent in an expensive city lost their connections to employment, friends and family due to drug abuse and antisocial behavior. It is not clear that individuals in such circumstances have a reasonable claim to housing at their current location.

Many homeless could be expected to refuse offers of housing elsewhere. Indeed, many street dwellers decline offers to move into nearby shelters and navigation centers. This leaves the question of whether the homeless should be obliged to take housing options that they may not like.

Preferences of the homeless must be weighed against the general public’s reasonable expectation of clean, safe streets. Homeless advocates in both government and nonprofits often ignore this constituency and instead enable antisocial behavior by offering tents, meals and hypodermic needles with no strings attached. The result has been a rollback of public health conditions to 19th century levels in some areas.

If government is unable to maintain cleanliness and order on city streets, it could turn the job over to private interests. Just as shopping mall owners generally allow public access while removing individuals creating a public nuisance, non-government organizations can achieve the same results on high-traffic city streets.

Short of assigning ownership of the sidewalks to merchants,

apartment owners and homeowners associations, it could delegate security responsibilities to these private parties. In some areas, merchant groups have already formed business improvement districts, but participants must agree to pay supplemental assessments to form such districts.

More such improvement districts would be possible if property owners could receive a credit against their property tax bills. After all, if municipal government is failing to provide secure, clean sidewalks in front of their properties, the city clearly hasn’t earned the taxes it is levying.

By providing large volumes of truly affordable housing and by empowering property owners to police their streets, California policymakers can solve the homelessness crisis without breaking the bank.

Marc Joffe, a Bay Area resident, is a senior policy analyst at the libertarian Reason Foundation.