$97.2 Billion to Build Homes for the Homeless?

A housing project for homeless women veterans in San Pedro, Calif. on Nov. 19, 2014. (Sarah Le/Epoch Times)

Commentary

California and its cities are being hit with a spate of proposals to deal with the homelessness problem. New Mayor Karen Bass of Los Angeles even declared a state of emergency on the crisis.

At the state level, the California Homeless Housing Needs Assessment, in the summary of a new report, calculated the problem could be solved if the state spent $8.1 billion per year over the next 12 years building housing—$97.2 billion. The assessment is a project of the Corporation for Supportive Housing, which is supported by the Ford Foundation and others foundation.

“We crunched the numbers,” the summary said. “These are the investments we need in order to connect 225,053 households experiencing homelessness with homes.”

That would mean per household cost of $431,898.

They also blithely wrote, “The state and federal governments are already projected to commit an average of $1.2 billion annually, reducing the gap to $6.9 billion, only 2.7 percent of the state’s annual budget.” They’re assuming a “budget” of $255 billion. Which is close to the number of $234 billion for the general fund in the enacted 2022-23 budget document. But the number possibly could go down if a recession hits.

Anyway, according to CalMatters, despite the recession and an expected deficit of $24 billion for 2023-24, “policymakers say they’ll maintain spending on social programs though advocates are calling for more.”

The only way $6.9 billion in additional spending for the homeless could be raised would be through tax hikes. That would be at a time when tax increases for other priorities, especially school funding, would be on the drawing board, and possibly enacted.

The full report also didn’t take into account two things ballooning the cost of housing for everyone, including new housing for the homeless. First there’s the California Environmental Quality Act, which scandalously is suspended for building sports stadiums for billionaire owners and millionaire players, but not for housing.

Second is Project Labor Agreements, which mandate high union wages for government projects, including for homeless housing. Usually the labor costs are doubled, to more than $60 an hour. A friend of mine works in the field and says building low-income housing in Los Angeles costs $800,000 for each unit.

A 2021 study (pdf) by the Rand Corp. looked at the effect of a PLA on housing constructed under Proposition HHH, the 2016 bond for $1.2 billion local voters passed to build housing for the homeless. The main conclusion:

The findings indicate that the inclusion of PLAs and similar labor regulations to funding programs such as HHH is likely to influence the primary housing production goals of such policies. In the case of the Proposition HHH, the use of a PLA with a housing unit-based threshold reduced the total housing produced through two channels, reducing the total housing units in a significant number of funded projects and increasing the cost of each housing unit in projects covered by the agreement.

Treating the Mentally Ill

Building more housing actually is not as important as treating the mentally ill. That was one of the things I found out when I was the press secretary to state Sen. John Moorlach, 2017-20. Along with balancing state and municipal budgets, it was his highest priority in office, as well as when he was an Orange County supervisor.

Obviously, the high cost of housing is a problem. But the homeless can double up with other people. And they can move to other, cheaper states, just as do people from all walks of life—the poor, middle class, and the wealthy.

Moreover, a lot of the homeless don’t want housing. They like living “free” outside. And the balmy weather in Coastal California lets them do so. Not many homeless are surviving outside in the snowstorms the Northeast states currently are enduring.

Moorlach worked to reform the Lanterman-Petris-Short Act, first passed in 1967 under Gov. Ronald Reagan, but modified since then. He wrote a summary of his views in Aug. 2020, “California Must Do More to Help the Long-Term Mentally Ill.” It included a link to a study he produced at the time, but that link doesn’t work anymore. Here’s a new link to: “A History of the Lanterman-Petris-Short Act of 1967.” It concluded:

The legislature must understand that the last half century of failed policies needs to change. We must provide proper resources to treat our severely mentally ill population with dignity, with humane and voluntary treatment options that create a compassionate process to deal with those who are gravely disabled and not able to properly care for themselves.

Two years later, the study still holds up. Gov. Gavin Newsom, before the pandemic hit the world, was talking about reforming the LPS Act, as it’s called. And in September this year he signed into law the CARE Court law, which his office described as “a paradigm shift that will provide individuals with severe mental health and substance use disorders the care and services they need to get healthy.”

It’s a difficult subject that would have been helped had Moorlach stayed in office. But voters had other ideas; or had other ideas given to them.

Finally, raising that extra $6.9 billion a year through tax increases actually would make mental illness worse by causing joblessness. Even if only the rich were taxed that amount, doing so would drive more of them, and the jobs-creating businesses they run, out of the state. Unemployment would rise, bringing with it mental anguish for those who lost their jobs.

Views expressed in this article are opinions of the author and do not necessarily reflect the views of The Epoch Times.