Gov. Gavin Newsom’s proposed 2026–27 May budget revision includes $500 million for the state’s Homeless Housing, Assistance and Prevention (HHAP) program, a reduction from the $1 billion allocations provided in previous funding rounds.
During his May 14 May Revision presentation, Newsom defended the reduced allocation, telling California Black Media (CBM) that the funding “is not a cut” or “an entitlement.”
“As a former mayor, I can assure you we never got any support. Not a dollar (to address homelessness),” Newsom shared with CBM. “This is one of dozen areas of support across the spectrum. The $500 million is new money.”
Established in 2019, HHAP is a state-funded block grant program that provides flexible funding to local governments to prevent and reduce homelessness. The funds support permanent housing construction, shelter operations, rental assistance, and wraparound services. Administered by the California Department of Housing and Community Development (HCD), the program emphasizes regional coordination and evidence-based strategies to move unhoused Californians into permanent housing.
The proposed reduction comes as local leaders warn that scaling back HHAP funding could reverse progress made in reducing homelessness across the state.
Leaders from California’s 13 largest cities, known as the “Big City Mayors Coalition,” traveled to Sacramento in April to advocate for a permanent $1 billion annual investment in the program.
Mayors including Rex Richardson of Long Beach, Barbara Lee of Oakland, Todd Gloria of San Diego, and Patricia Lock Dawson of Riverside argued that reduced state support could force thousands of people back onto the streets. According to the coalition, the funding decrease could eliminate as many as 6,000 shelter beds statewide and place up to 41,000 people currently housed or in temporary shelter at risk of returning to homelessness.
Lee said Black residents in Oakland are disproportionately impacted by homelessness.
“Oakland requires a racial equity approach at every single level of government through our programs that prevent homelessness and create more housing opportunities,” Lee said. “I can’t accomplish any of this without HHAP funding.”
The HHAP reduction is part of Newsom’s nearly $350 billion proposed state budget, which seeks to address projected deficits by reducing or restructuring several General Fund commitments before the governor leaves office at the end of the year.