Mayor Todd Gloria speaks in City Council Chambers in downtown on June 13, 2023.
Mayor Todd Gloria speaks in City Council Chambers in downtown on June 13, 2023. / Photo by Ariana Drehsler

Mayor Todd Gloria’s updated budget proposal largely minimizes previously planned cuts for city homeless programs that left the city’s housing agency reeling last month but it also forces the City Council to make a hard call: Should the city pull funds planned for affordable housing projects to shield shelters and other homelessness programs from significant cuts?

It’ll be solely up to the City Council, which also acts as the city’s Housing Authority, to decide.

Gloria released a revised budget earlier this week that invests $41.3 million in city homeless programs overseen by the Housing Commission, up from the $27.9 million in his initial budget that spurred backlash from agency leaders and advocates. Gloria bridged much of the budget gap with the help of state funding that’ll arrive earlier than expected but proposes addressing the remaining shortfall with $8 million in funds from the city’s affordable housing fund.

Raiding the housing fund would mean the commission won’t have as much money to hand out next year to help deliver housing projects crucial to combating an intertwined homelessness and housing crisis. Gloria’s suggestion also comes at a time of major expected state cuts predicted to impact low-income housing projects.

Gloria’s team argues it’s a necessary step as the city tries to close a major budget deficit while affordable housing advocates and one city housing commissioner are adamant it’s a short-sighted move.

Every year, the Housing Commission pitches a plan to spend fees from developers. The plan includes opportunities for other developers to seek those funds for their low-income housing projects. The agency’s draft plan for the upcoming year now includes $6 million for affordable housing projects and another $2 million on loans for casitas and aspiring homeowners.  

The City Council’s land use committee last month reviewed the initial plan and forwarded it to the full City Council, which will need to review it outside the city’s ongoing budget process.

The city’s affordable housing fund grabbed attention from city officials as Gloria’s office proposed significant cuts and approached the Housing Commission asking for $15 million to balance the budget that the agency said it didn’t have to give.

In an April 1 email obtained by Planetcob, Housing Commission CEO Lisa Jones noted that the “only funding source” that the City Council could free up and potentially redirect to homeless shelters and services would be the affordable housing fund. 

“There are restrictions on the use of these funds, and affordable housing developers expect these funds to be made available to partially fund affordable housing projects in their pipeline,” Jones wrote. “However, I do respect that there are competing needs for both homelessness shelter beds and more affordable housing, so it is a conversation that your office and councilmembers may wish to have.”

Gloria’s office later released a proposed budget reducing the housing agency’s homelessness budget and simply asking the agency to identify $15 million it could contribute.

After pushback from City Council and advocates and talks with the Housing Commission, Gloria’s office is proposing that the City Council tap the affordable housing fund.

The vice chair of the Housing Commission and the leader of an advocacy group for affordable housing developers believe that will have negative long-term ramifications.

“It's a tragedy any time housing resources are shifted into shelter operations,” Commission Vice Chair Ryan Clumpner wrote in a text message. “We are selling tires off the car to buy a tank of gas.”

Stephen Russell of the San Diego Housing Federation agreed.

“Our concern is that they’re taking money for long-term actual solutions to homelessness and using it to fill gaps in a shelter system,” Russell wrote.

Gloria spokesperson Rachel Laing argued it’s the right call.

“We have a crisis on our streets right now and an expectation from the public to act with urgency,” Laing wrote in a text message. “Our budget deficit demands we be creative and smart with all available funds to help the greatest number of people.”

Laing also noted that the mayor’s team expects to offer at least $20 million in gap financing for affordable housing projects via the city’s Bridge to Home program next year, which she wrote was “in keeping with our commitment to making affordable housing a key element of our strategy to end homelessness.”

Almost all of the projects supported by this city program that prioritizes housing for formerly homeless people have thus far also counted on vouchers that the Housing Commission says it’ll be less equipped to provide in the years to come.

It’s unclear if the City Council will be on board with the path Gloria’s office proposes for Housing Commissions’ housing funds.

In 2018, former councilmembers weathered criticism when they opted to reallocate funding for affordable housing projects to homeless service programs, including the city’s then-new bridge shelter programs.

In an April land use committee hearing, sitting councilmembers were already grappling with the tradeoff.

Councilmember Vivian Moreno said she had “great concern” about reducing funding for affordable housing and first-time homebuyer loans and Councilmember Kent Lee said he thinks it’s crucial for the city to prioritize funding for housing and preservation of existing low-income units to help prevent homelessness.

“We've had so many discussions over the last year about how important prevention efforts ultimately are the key to solving our housing and homelessness crisis,” Lee said. “We can't simultaneously address issues from a homelessness standpoint if we only see the number of folks ultimately end up on the street per month increase because of a lack of prevention efforts.”

Councilmember Stephen Whitburn, meanwhile, said that while he considers both housing and homeless program funding critical, he’d ultimately advocate to preserve shelter programs.

“Given the humanitarian crisis of homelessness that exists and the hundreds of deaths that we have seen on our streets just in the past year, I do prioritize helping those folks get into a safer and healthier shelter or safe sleeping site,” Whitburn said.

As councilmembers weigh what to do, they will also likely scrutinize the state of homelessness program funding – even if they decide to reallocate the affordable housing funds.

Following questions from Voice, Jones wrote in an email that the housing agency appreciates changes made by Gloria’s office, including revisions that essentially fully fund an eviction protection and Father Joe’s Villages homeless day center program.

But there are still planned cuts.

A much-lauded homelessness prevention program received increased funding in the mayor’s updated budget, but Jones said it will only be equipped to support clients already enrolled in the program rather than help new clients on the brink of homelessness.

Jones said the mayor’s budget also appears to end lunch service at two shelters the commission has argued need it and to not include 3 percent cost-of-living and additional living wage adjustments for shelter staff recommended in a 2022 compensation study that found that the city’s homeless service workers are underpaid.

Housing Commission Chair Mitch Mitchell said he plans to ask the business community to help support the agency’s homelessness prevention program to help minimize the impact of planned cuts and to push for the housing agency to etch out a plan to try to continue to make progress on homelessness whatever the budget outcome.

While Mitchell acknowledged he’s uncomfortable with potential housing fund and other budget impacts that he fears could stall progress in tackling homelessness, Mitchell – like Gloria’s spokesperson – emphasized the need for the city and its housing agency to “be creative” during difficult budget times.

If the City Council decides to pull from the affordable housing fund, Mitchell said he’s hopeful it will just be a one-year move.

Now, Mitchell said, the ball is in the City Council’s court.

“This has always been positioned by the commission as an option for the City Council to consider,” Mitchell said. “It is their decision and their decision alone and we will live with whatever they decide.”

Lisa is a senior investigative reporter who digs into some of San Diego's biggest challenges including homelessness, city real estate debacles, the region's...

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4 Comments

  1. How has the city deficit and the amount paid out to Cisterra not been connected? What if the City hadn't paid out that botched lease? Would we be in the same deficit we are in now?

  2. Suggest people looking for “low cost” housing move to one of the twenty five states where housing cost less than 15% of monthly income, rather than the two most expensive states California and Hawaii. See https://homebuyer.com/research/cheapest-state-to-buy-a-house
    Using taxpayer’s money to buy down expensive San Diego housing ($999,000 median list price), rather than move to one of the nine states (where the median house price is <$150,000)
    https://www.realtor.com/realestateandhomes-search/San-Diego_CA/overview
    is impacting government ability to meet its responsibilities such as roads, education and support for less fortunate citizens.

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