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THE BOTTOM LINE -
Five years and $3.8 billion later, Californians still don't know whether Homekey solved homelessness—or simply became another government boondoggle.For years, Californians have been told that homelessness could be solved if government simply spent more money.
When encampments grew, officials called for larger budgets. When public frustration increased, taxpayers were told that another investment, another initiative, and another round of funding would finally turn the tide.
Then came Homekey.
Launched by Governor Gavin Newsom during the height of the COVID-19 pandemic, Homekey was promoted as an emergency solution to two crises at once: homelessness and public health. The state committed more than $3.8 billion to help cities, counties, and nonprofits purchase hotels, motels, and other properties and convert them into permanent housing for homeless residents.
The program was celebrated as innovative. Advocates praised its speed. Politicians pointed to it as proof that government could move quickly when faced with an emergency.
Five years later, however, a fundamental question remains unanswered:
Did taxpayers get what they paid for?
A recent investigation built on more than 100 public records requests offers the most detailed look yet at the results of California's largest hotels-to-housing effort. The findings reveal a program that produced genuine successes but also significant failures, costly delays, unfinished projects, and troubling questions about accountability.
To be fair, Homekey did create housing.
According to state figures, nearly 13,500 people are living in Homekey-funded sites across California. Many communities that previously had little or no homeless housing infrastructure were able to establish facilities and services. Local officials in several regions report that the program helped stabilize vulnerable residents and connect them with counseling, healthcare, and supportive services.
Those accomplishments should not be ignored.
But neither should the other side of the ledger.
The investigation found that approximately one out of every five promised Homekey housing units remained unfinished at the end of last year.
Thousands of units have yet to achieve the permanent housing status that was the program's primary objective.
Hundreds more units were tied to projects that were canceled, abandoned, or never fully materialized despite public announcements and grant awards.
Those numbers matter because every unfinished project represents public money that has yet to deliver the results taxpayers were promised.
The story of a former Travelodge in Gardena illustrates the problem.
According to reports, the property was acquired through the program and transferred for operation before extensive vetting could occur. Initial estimates suggested relatively modest rehabilitation costs. Reality proved very different.
Years later, millions of additional dollars had been spent, major infrastructure deficiencies had been uncovered, and the property remained vacant. What appeared to be a quick housing solution became a prolonged and expensive rehabilitation project.
Unfortunately, that example was not unique.
The urgency that defined Homekey's launch often came at the expense of traditional safeguards. The program intentionally reduced bureaucratic hurdles, accelerated timelines, and moved funding out the door at unprecedented speed.
That approach undoubtedly helped some projects move faster.
But speed without adequate oversight carries risks.
When billions of taxpayer dollars are involved, due diligence is not a luxury. It is a necessity.
The investigation found examples of projects plagued by delays, budget overruns, management problems, and even allegations of fraud. Some developers reportedly struggled under the weight of projects that became far more costly than anticipated.
Meanwhile, Californians still lack a comprehensive public accounting of which projects succeeded, which failed, and what lessons were learned.
That may be the most troubling aspect of all.
The debate should not be whether homelessness deserves public investment. It does.
The debate should be whether government is delivering measurable results for the enormous sums being spent.
Taxpayers have a right to know how billions of dollars were allocated, what outcomes were achieved, and why certain projects succeeded while others faltered.
Transparency should not be viewed as an obstacle to compassion.
Accountability is part of compassion.
Every dollar wasted on a failed project is a dollar unavailable for housing, treatment, mental health services, public safety, infrastructure, or countless other priorities facing California communities.
Supporters of Homekey argue that the program was launched during an unprecedented emergency and should be judged accordingly. There is truth in that argument.
But emergencies do not eliminate accountability.
They make accountability even more important.
California's homelessness crisis remains one of the state's most urgent challenges. Future solutions will require substantial investment, innovation, and political courage.
They will also require something that has too often been missing from public discussions about homelessness spending: rigorous oversight and honest evaluation.
Homekey may ultimately be remembered as a program that helped thousands of Californians find stability and shelter.
It may also be remembered as a cautionary tale about what happens when government moves billions of dollars faster than transparency can keep pace.
Five years and $3.8 billion later, Californians deserve more than headlines, promises, and press releases.
They deserve answers.
(MIhran Kalaydjian is a seasoned public affairs and government relations professional with more than twenty years of experience in legislative affairs, public policy, community relations, and strategic communications. A respected civic leader and education advocate, he has spearheaded numerous academic and community initiatives, shaping dialogue and driving reform in local and regional political forums. His career reflects a steadfast commitment to transparency, accountability, and public service across Los Angeles and beyond.)
