San Jose could face audit over homeless funds

A California legislator is questioning whether San Jose is wasting millions of dollars in state and federal monies in its efforts to address the homelessness crisis.

State Sen. Dave Cortese made a formal request with the state auditor this week to conduct a review of San Jose’s use of funding on emergency housing programs and services, such as Project Homekey, to help homeless people off the streets. Project Homekey is the state’s multi-billion dollar grant program for homeless housing. San Jose has received an unprecedented amount of funding—at least $135 million in state funding and spent roughly $12 million in federal money—to expand its temporary housing projects since the beginning of the COVID-19 pandemic.

Cortese wants the audit to scrutinize the success rate of those programs and look into whether the city is addressing public safety and health issues at homeless camps. The state’s Joint Committee on Legislative Audit will have to approve the request.

“The Legislature and the governor have pushed forward billions of dollars to the 13 largest cities and through counties to smaller cities for several years, and still our constituents are coming to us to ask, ‘when is help coming to us?'” Cortese told San José Spotlight. “This is not finger pointing, but it says, ‘let’s go back and figure out why billions of dollars isn’t working.”

The request came after Cortese saw the squalid living conditions at San Jose’s largest homeless encampment near Columbus Park earlier this year. During the peak of the pandemic, the area was home to an estimated few hundred people, who lived in makeshift structures and vehicles that were infested with rats, among other issues.

San Jose cleared out the sprawling camp in September to meet a Federal Aviation Administration deadline after helping more than 140 people at the site into shelter, temporary or permanent housing. The site is in the flight path of Mineta San Jose International Airport, and the city risked losing millions in federal funding if the camp wasn’t cleared. As of this week, dozens of people still remain in the area, staying in the baseball field across the street from FAA land, with nowhere to go.

Santa Clara County Supervisor Cindy Chavez, who urged Cortese to request the audit, said San Jose’s plans are not working.

“After touring the Columbus Park encampment, it was clear the city of San Jose was not efficiently or effectively spending the state and federal funding we were afforded including (Project) Roomkey and Project Homekey,” Chavez said in a statement. “Most troubling is there was no accountability by the city of San Jose.”

If approved, Cortese said the audit could take up to six months, adding San Jose has agreed to provide documents and records to the state for review. He hopes the results would better inform budgetary decisions and find the best practices to address homelessness.

San Jose spokesperson Carolina Camarena said the city welcomes questions from Cortese.

“San Jose’s homeless spending and outcomes are readily reported and discussed in public hearings held by the council and council committees,” Camarena told San José Spotlight, adding the city provided some information to Cortese’s office earlier this year. “We encourage him and his staff to review publicly available information and are happy to meet and discuss the reports with him.”

She also said the city used local funding to help the population at the camp near Columbus Park, not state funding.

“No state or Homekey funds were designated for the area, thus, an audit is unnecessary,” she said.

San Jose has seen its homeless crisis explode in the last few years, with the COVID-19 pandemic further upending the lives of thousands of families and residents. Despite unprecedented funding to bring more housing solutions online, efforts continue to fall short, as residents fall into homelessness at a faster rate than people are being housed. San Jose saw its unhoused population grow 11% during the pandemic, from 6,097 homeless people in 2019 to 6,739 this year. Mayor Sam Liccardo called the crisis the city’s “biggest failure” in his annual speech last year.

The call for a state audit comes just days after Gov. Gavin Newsom announced he’s halting a $1 billion homelessness grant to cities, citing the lack of accountability. Newsom called for more aggressive strategies, adding that current plans proposed by local leaders would only reduce 2% of the homeless population by 2024. San Jose has received roughly $35 million from the grant since 2020.

Liccardo responded to the governor in a statement that San Jose’s efforts are working, pointing to 700 homeless people who have been housed in the last two years.

“In San Jose, we’ve constructed prefabricated, quick-build housing communities in a fraction of the time it takes to build traditional housing at a fraction of the cost,” Liccardo said. “More than 80% of our quick-build residents remain housed a year later.”

Robert Aguirre, a homeless advocate who has spent years helping the vulnerable population in the South Bay, applauded Cortese’s request for an audit.

“An audit does need to be taken,” Aguirre told San José Spotlight. “We need to look to see how monies are being spent and how effective that is, because I believe the city is not doing as much as they could be doing.”

Contact Tran Nguyen at [email protected] or follow @nguyenntrann on Twitter.