SAN JOSE AND Santa Clara County won’t lose a dime after Gov. Gavin Newsom threatened to withhold state funding for homeless services.

Earlier this month, Newsom announced a halt to the planned distribution of $1 billion from the Homelessness Housing, Assistance and Prevention (HHAP) grant program because the plans presented by qualifying jurisdictions would not have done enough to reduce homelessness. The governor said funds would be on hold at least until he convened a meeting this past Friday with local leaders on the state’s approach to homelessness.

But less than 10 days after Newsom’s Nov. 3 announcement, the state emailed cities that the money would be sent as long as they answered three questions about the methodology and efficacy of their homeless plans.

While homeless advocacy groups and several big city mayors shared frustrations with Newsom’s brief pause, San Jose Deputy Housing Department Director Ragan Henninger said she never feared the city would lose the $23 million that it had yet to receive from the grant program.

“The state just needed more information,” she told San José Spotlight. “We have been on track to meet our goals.”

While San Jose was able to house more than 6,000 residents in the past two years, homelessness has still increased 11 percent since 2019, according to the Santa Clara County point in time count. It’s the highest number of homeless residents since 2007.

This round of HHAP funding includes $1 billion — contingent on state approval — for California counties, Continuum of Care agencies and the 13 largest cities in the state — to reduce the number of unsheltered homeless individuals and increase permanent housing.

“The state just needed more information. We have been on track to meet our goals.”

Ragan Henninger, San Jose deputy housing department director

However, Newsom was not pleased when an analysis of the submitted plans showed the billion-dollar investment would only result in a 2 percent decrease in homelessness statewide, with homelessness actually forecast to increase in several cities and counties.

Henninger defended San Jose’s plan and said it will continue to fund programs that have already shown success. The city is not planning to change how it will spend its dollars.

San Jose already received about $5.8 million from the program, which was partly used to purchase and transform the Pavilion Inn Motel to housing for youth aging out of the foster care system. The city is planning to allocate the remaining $23 million next year on operational costs for interim housing sites, motel voucher programs, youth homeless services, homeless outreach efforts and mobile showers and laundry services. The grant would also pay to hire more workers on the city’s homeless response team.

“It’s very flexible funding that allows cities to respond to our most urgent needs,” Henninger said.

Through the grant program, San Jose hopes to reduce unsheltered homelessness by 4 percent and increase the capacity of the supportive housing system by 10 percent. It also plans to place nearly 500 residents into permanent housing, according to city documents.

Sandy Perry, president of the Affordable Housing Network of Santa Clara County, said the grant program won’t solve homelessness, but it will at least help.

“The real plan that would end homelessness is hundreds of thousands of permanently affordable housing units,” he told San José Spotlight. “That’s the real plan — $29 million is not going to do that.”

Contact Jana Kadah at or @Jana_Kadah on Twitter.

This story originally appeared in San Jose Spotlight.