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Governor’s 2021-22 State Budget Proposal Provides $750 Million for a Second Round of Project Homekey Funding

By: Joe Colletti, PhD
January 11, 2021 —


First round Homekey funding was awarded to eligible applicants
in approximately half of California’s 58 counties

Second round Homekey funding would provide another opportunity
for eligible applicants to receive funding in the other half of counties


The Governor’s 2021-22 State Budget proposal to the Legislature includes $1.75 billion one-time funding to further the successful pace of the first round of Project Homekey, which consisted of over $800 million awarded to 51 local agencies for 94 projects to provide over 6,000 housing units to help stop the spread of COVID-19 among households experiencing homelessness.

The map below shows that the first round Homekey funding was awarded to eligible applicants in approximately half (56.9%) of California’s 58 counties to purchase and rehabilitate housing, which included hotels, motels, vacant apartment buildings, and other buildings and convert them into either interim or permanent housing including supportive housing.

The map also notes the total amount that eligible applicants received in each county. Eligible applicants are local public entities, which include cities, counties, or other local public entities, including housing authorities or federally recognized tribal governments within California.

Second Round of Homekey Funding

Of the $1.75 billion one-time funding, the proposed budget

“includes $750 million one-time General Fund for HCD (Department of Housing and Community Development) to continue to provide competitive grants for local governments to purchase and rehabilitate housing, including hotels, motels, vacant apartment buildings, and other buildings, and convert them into interim or permanent long-term housing.

The Tahiti Motel, seen here on Thursday, September 3, 2020, could be used as part of the Project Homekey program. The motel is on Beach Blvd. in Stanton, CA. (Photo by Paul Bersebach, Orange County Register/SCNG)

To sustain this momentum and meet local governments’ demand for additional funding, the Administration is asking the Legislature to take early action to approve $250 million one-time General Fund in 2020-21 to continue funding Homekey projects.

As part of this early action, the Administration proposes the same streamlining benefits provided by the Legislature in 2020 be extended to all future Homekey acquisitions and rehabilitation projects so that local governments can continue to successfully expend funds at the pace necessary to match the urgency of the homelessness crisis.”

Implications for Next Steps

As stated in the first round Project Homekey Notice of Funding Availability (NOFA), the state

“would like to ensure jurisdictions throughout the state have an equitable opportunity to apply for Homekey funds to protect the health and safety of their most vulnerable residents.”

Local public entities would have another opportunity to apply for Project Homekey funding to purchase and rehabilitate housing for either interim and/or permanent housing including supportive housing within those counties not shaded in green in the map above.

As noted in the Governor’s proposed budget, the building upon the success of Homekey also involves further development of “a broader portfolio of housing needed to end homelessness through continued acquisitions and creation of new units” by including an increasing investment in behavioral health continuum infrastructure and Adult Residential Facilities and Residential Care Facilities.

Increasing investment in behavioral health continuum infrastructure

The proposed budget recommends

“$750 million one-time General Fund, available over three years, for the Department of Health Care Services to provide competitive grants to counties for the acquisition and rehabilitation of real estate assets to expand the community continuum of behavioral health treatment resources.

These resources seek to improve the comprehensive continuum of services by providing short-term crisis stabilization, acute needs, peer respite, and other clinically enriched longer-term treatment and rehabilitation opportunities for persons with behavioral health disorders, in the least-restrictive and least-costly setting.

The Administration estimates that this proposal will result in the addition of at least 5,000 beds, units, or rooms.”

Increasing investment in Adult Residential Facilities and Residential Care Facilities

The proposed budget also recommends

“$250 million one-time General Fund for the Department of Social Services to counties for the acquisition or rehabilitation of Adult Residential Facilities (ARF) and Residential Care Facilities for the Elderly (RCFE) with a specific focus on preserving and expanding housing for low-income seniors.”

This article courtesy of HomelessStrategy.com


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