California Governor Gavin Newsom pledges $200 million for hotel-to-housing conversion program

Plenty of Room at the Inn

California Governor Gavin Newsom pledges $200 million for hotel-to-housing conversion program

Today’s Motel 6, tomorrow’s supportive housing complex for California’s most vulnerable residents. (pony rojo/Flickr/CC BY-SA 2.0)

On October 23, California Governor Gavin Newsom announced the approval of a “major injection” in the form of $200 million in additional funding to help expand and support Homekey, a state-backed, housing-focused grant program also known as Project Homekey. The initiative provides California Department of Housing and Community Development (HCD)-administered awards to individual cities, counties, tribal groups, and other local agencies and authorities so that they can, in partnership with the state, acquire and convert motels, hotels, vacant apartment complexes, and other redundant buildings into emergency interim and permanent housing for Californians experiencing or at-risk of homelessness. In addition to providing stable, long-term housing to the state’s unsheltered population, some Homekey projects are also geared toward providing safe accommodations to Californians most vulnerable to COVID-19.

The first-of-its-kind initiative, an evolution of the Project Roomkey program that stresses a greater importance on establishing permanent housing, first kicked off four months ago with $600 million in funding. The additional funds, approved by the Joint Legislative Budget Committee using monies from the state’s Coronavirus Aid Relief Fund, bring that total to over $800 million. As of earlier this month, $709 million had been awarded to 45 applicants and 78 projects across the state, generating a total of 5,068 new housing units earmarked for the state’s homeless population. Most of these planned developments will be bolstered by support services provided by local organizations to further help residents get back on their respective feet. Coinciding with the Newson’s announcement of additional funding for Homekey was the waitlist-clearing release of a sixth round of housing grants totaling $81.4 million that will allocated to five applicants for six planned projects that will see 430 new housing units across the state come into existence.

It goes without saying that California’s homelessness crisis knows no geographic boundaries. The entirety of the state is impacted. As such, Homekey has spurred planned motel conversion projects across the state ranging from the Coach N Four Motel in Grass Valley, a small community in rural Nevada County, to a Holiday Inn in high-density Long Beach. While the state’s larger cities like Los Angeles are primarily focused on acquiring and refurbishing belly-up motor lodges, other awardees are getting more creative with their housing funds. For example, El Centro, a border city of roughly 44,000 residents in the state’s Imperial Valley, has announced that the $3 million grant that it was awarded in September as part of the first funding round will be erect a 26-unit tiny house village for local homeless college students and youth transitioning out of foster care.

The just-announced sixth round of funding, like previous rounds, further reflects this geographically disparate need. As detailed in a recent press release the latest award recipients include: Los Angeles County (more than $24.1 million for 135 units of interim housing with wraparound support services); the City of Oakland ($17.5 million for two separate projects totaling more than 100 new units of both interim and permanent housing); San Francisco ($29.1 million for a 130-unit permanent housing complex with support services); Santa Clara County ($9.5 million to acquire 54-unit property with support services that will include both interim and permanent housing with future plans to expand to 110 units of permanent, supportive housing), and San Bernardino County ($1.1 for eight short-term vacation rentals that will be converted into homes for families and individuals experiencing homelessness with priority given to the elderly, those with disabilities and those at high-risk of COVID-19 infection.)

A past Homekey grant recipient is the city of San Jose, which received $14.5 million to transition a 76-unit motel property acquired for interim housing during Project Roomkey into a permanent housing complex. Newsom announced the additional $200 million in funding and sixth round of awards while visiting one of three new modular housing-based emergency interim communities in San Jose that were established independently of Homekey and provide shelter to over 300 people experiencing homelessness in California’s third-most populous city.

“We continue striving to deploy creative solutions as COVID-19 exacerbates the housing crisis and puts thousands on the street, and with the financial help we receive from Homekey, we are expanding our efforts to provide permanent housing to our homeless neighbors. I am grateful to Governor Newsom for his staunch support in our fight to end homelessness,” said San Jose Mayor Sam Liccardo in a statement.

While local governments and housing organizations have demonstrated “significant”—to quote Newsom’s office—interest in Homekey as they vie for state funding, plans to breathe new life into underutilized or defunct motel properties hasn’t necessarily been warmly received across the board. In Sacramento’s River District, for example, the developers of a planned luxury apartment development have sued the city in an effort to halt the conversion of a nearby Hawthorn Suites hotel property into a Homekey-funded community for the homeless, claiming that its presence will stunt development in the immediate area. (Another Homekey-funded permanent supportive housing project in Sacramento, this one spearheaded by the Sacramento Housing and Redevelopment Agency in partnership with Mercy Housing, has since been greenlit by the city council.)

Elsewhere, in the affluent Silicon Valley community of Milpitas just north of San Jose, the city council has unanimously voted to move forward with a lawsuit aimed to halt the planned conversion of an Extended Stay America property into a 132-unit supportive housing community. Per the San Jose Mercury News, the litigation targets all parties involving in the Homekey housing project including Santa Clara County and nonprofit developer Jamboree Housing. The county had been awarded $29.2 million in Homekey funding in September for the $80 million project—a move initially supported by the Milpitas City Council. The city, however, has since rather drastically changed its stance on the project based on feedback from local residents. Meanwhile, an online petition launched by Milpitas residents in support of the project has received hundreds of signatures.

“I get the pressure you’re under, but you’re going to look back in your life, and you’re going to regret this,” the Vallejo Times-Herald reported Newsom as saying in to response to news of the lawsuit in a statement aimed directly at the city council and Milpitas Mayor Rich Tran. “You have an incredible moment in time. It’s a moral damn moment. Do the right thing.”