Cities and counties to use funds to acquire hotel/motel rooms and other buildings to convert to permanent housing

SACRAMENTO — Building on the success of Project Roomkey, Gov. Gavin Newsom announced Thursday the availability of $600 million in funding for Homekey, the next phase in the state’s response protecting Californians experiencing homelessness who are at high risk for serious illness from COVID-19.

Administered by the California Department of Housing and Community Development (HCD), Homekey will be the largest expansion of housing for people experiencing homelessness in recent history, while addressing the continuing health and social service needs of this vulnerable population. The $600 million in grant funding will be made available to counties, cities, and other government entities to purchase and rehabilitate housing including hotels, motels, vacant apartment buildings, and other types of innovative housing, and convert them into permanent, long-term housing for people experiencing or at risk of experiencing homelessness.

“Homekey is a once-in-a-generation opportunity to massively expand housing for the homeless in California with federal stimulus funds,” said Governor Newsom. “This unique opportunity requires us to move quickly, in close collaboration with our city and county partners, to protect the most vulnerable people in our state.”

Geographic and racial equity have been baked into Homekey, with dedicated funding for various regions and a goal of addressing the deeply inequitable impact of homelessness on Black and Latino communities across California.

Of the $600 million in funding for Homekey, $550 million will be provided to cities and counties by California’s direct allocation of the federal Coronavirus Aid Relief Funds, with an additional $50 million provided by California’s General Fund to supplement the acquisition and provide initial operating funds.

Governor Newsom urged cities and counties to move quickly. HCD is expected to begin accepting applications on July 22, and the first tier of projects will be fast-tracked for awards during the first 30 days. Any awards cities and counties receive must be spent by Dec. 30.

HCD and the Department of General Services will provide robust technical assistance to help cities and counties quickly and successfully apply for this critical funding

In addition to Homekey funding, additional funding for cities and counties will also be available from federal, state, local and philanthropic sources.

To further support the implementation of Homekey, Governor Newsom recently signed new legislation providing a California Environmental Quality Act (CEQA) exemption and automatic zoning compliance for converted hotels, motels, and other housing types that utilize Homekey funding.

“Homekey builds upon the strong collaboration between the state and local governments that led to the success of Project Roomkey,” said Lourdes Castro Ramírez, Secretary of the Business, Consumer Services and Housing Agency, which oversees HCD and which includes the Homeless Coordinating and Financing Council. “We must use this momentum to build permanent housing solutions for individuals experiencing homelessness.”

“HCD is thrilled to administer this historical program to help the most vulnerable amongst us, while also protecting the public health of all,” said HCD Director Gustavo Velasquez. “HCD is putting forth dedicated resources to ensure cities and counties receive the assistance they need and these funds are distributed quickly so those most in need are served as soon as possible.”