California is rapidly reshaping its approach to homeless tent encampments in the wake of last year’s Supreme Court ruling that allowed cities to enforce anti-camping bans even when people have nowhere else to go.
There are approximately 275,000 people living unsheltered in the US, with over half of them in California, and the Grants Pass v. Johnson decision has emboldened cities to break up such encampments and expand “interim housing” options, like tiny house shelters and motel rooms, to move people more quickly off the street.
Critics argue that this approach risks creating a two-tiered housing system that could mask rather than solve the crisis. Still, the fact that temporary housing units can be erected much more quickly than permanent supportive housing (roughly five months rather than five years) and cheaply ($50,000 to 100,000 per unit rather than $600,000 to $1 million per unit) has provided elected officials with an attractive policy solution to their mounting political problems.
In California, where homelessness has become both a defining political liability for elected officials and a national symbol of the state’s governance challenges, cities are particularly eager to demonstrate progress on their streets. Perhaps no California politician has been more enthusiastic about the potential of tiny house shelters than San Jose Mayor Matt Mahan, who proposed in 2023 to divert more than a third of his city’s housing funds to increase production. (San Jose is the largest city in Northern California, with roughly 1 million residents.)
Mahan campaigned for reelection in 2024 on clearing street homelessness, and since winning, he’s pledged to build more than 1,000 new temporary housing units by the end of 2025. More recently he declared that he wants to arrest homeless people who repeatedly refuse to go to shelter. “Homelessness can’t be a choice,” Mahan said. “Government has a responsibility to build shelter, and our homeless neighbors have a responsibility to use it.”
This more forceful approach is also being embraced in San Francisco, where the newly elected Mayor Daniel Lurie has been expanding interim housing options and moving people more quickly off the streets. Tent encampments are down in San Francisco — the lowest level on record since the city started tracking in 2019 — and crime has similarly plummeted. Arrests of homeless people are also up. According to the San Francisco Chronicle, nearly 120 homeless people were arrested in March, the highest recorded of any month in the prior seven years, and more than 700 people were arrested since August, following the Grants Pass decision.
“In the past it was only social services-led, and you’re just not going to social work your way out of this problem,” Kunal Modi, the mayor’s chief of homelessness policy, told me. “But you’re equally not going to arrest your way out of this challenge, so we’re trying to find the balance between the two.”
Elizabeth Funk, the CEO of Dignity Moves, a nonprofit that began five years ago to apply “Silicon Valley-style ‘disruptive thinking’ to America’s homelessness crisis,” has been leading the charge for expanding tiny house shelters in California. She credits the Grants Pass decision for moving things along. “It did give a push,” Funk told me, “because ironically cities were getting off the hook, saying, ‘Well why would we build shelter? We can’t make people take it.’ So now there’s no more excuse to say, ‘Well if we build it it’ll sit there empty.’”
The momentum for interim housing extends beyond city halls. Last year, state lawmakers passed the Interim Housing Act in support of the tiny houses approach and now are advancing two more bills to accelerate the model statewide.
The approach is gaining national attention too. Former San Jose Mayor and current US Rep. Sam Liccardo told me he’s drafting federal legislation that would let Housing Choice Vouchers, commonly known as Section 8, fund interim housing options — something these rental subsidies currently aren’t authorized to support. As Mahan’s predecessor, Liccardo led the establishment of San Jose’s first interim shelters to reduce contagion risk during the pandemic. (Each interim shelter unit offered residents more privacy than congregate shelters, where people sleep in shared spaces, or than sleeping outside to avoid Covid-19).
“I’m talking to my Republican colleagues, including the chair of the subcommittee in the House, Mike Flood, and there is interest in greater flexibility in Section 8,” Liccardo said, suggesting potential bipartisan appeal for the model. On homelessness generally, he added, “we just need a more nimble response.”
The law-and-order orientation of the Trump administration coupled with its slash-and-burn approach to federal funding will probably push the interim housing model forward, Funk predicts. “It’s an interesting time,” she said, “and as much as it breaks my heart to see so many cuts to programs that help take care of people, in a funny way, if there’s no more federal funding for permanent housing it’s going to force the issue that we need to fund less expensive solutions.”
The debate over “success” in solving homelessness
Across the US, 150 cities have passed new restrictions on homeless encampments since the Grants Pass decision last June, according to the National Homelessness Law Center. Roughly a third of those cities have been in California.
Elected officials have partly justified these new rules as a step toward achieving “functional zero unsheltered homelessness” — a narrower version of the broader policy goal of “functional zero homelessness,” introduced in 2014 by the nonprofit Community Solutions. The organization’s idea was to define success as building systems where homelessness is rare, brief, and nonrecurring, and this framework has since been embraced by the Department of Veterans Affairs and the US Interagency Council on Homelessness. In 2021, Community Solutions was awarded the MacArthur Foundation’s $100 million grant for its work advancing this approach.
California lawmakers and Dignity Moves have started to invoke the “functional zero” and “rare, brief, and nonrecurring” language but applied only to those sleeping outside or in places not primarily meant for human residence, like cars or train stations. In other words, they’re not focusing on homeless individuals living in congregate shelters or those doubling up in cramped apartments. (One of the two state interim housing bills this year is called the Functional Zero Unsheltered Act of 2025.)
“Getting to zero for unsheltered street homelessness should be the top priority,” California state Sen. Catherine Blakespear, who is sponsoring one of the state interim housing bills this year, told me. “And I’ve had a shift in my own thinking about this.”
Some homelessness advocates have pushed back on the new usage. “‘Functional zero’ is widely recognized in the homeless policy world, but ‘functional zero unsheltered’ is not a phrase we recognize because it suggests the possibility that sheltered homelessness is an acceptable state of affairs for folks,” Alex Visotzky, a senior California policy fellow with the National Alliance to End Homelessness, told me. “When you focus on unsheltered only, most of the time you only make things worse because that leads to a logjam in your shelter system where folks can’t get out.”
Visotzky challenges the assumption that only slow-to-build permanent housing can solve homelessness. While it does take years to build new permanent housing, he stresses that it doesn’t take years to get people into permanent housing, through a targeted approach of case management, housing subsidies, and reconnecting people with family and friends. Advocates like Visotzky say they don’t oppose interim housing per se, but worry about politicians diverting funds for permanent housing, and preventing people from moving into a real home for even longer.
The rush of private business into the tiny house space gives advocates pause too, and they worry what this next era of criminalization will look like. More than one-fifth of people experiencing homelessness currently have a serious mental illness like bipolar disorder or schizophrenia, and the US Department of Justice had found that “the prevalence of unmet behavioral health needs” is a key driver in why “people who experience homelessness tend to have frequent (and often repeat) interactions with law enforcement.” Not all interim housing communities have the support services necessary to help people with serious mental illness, and advocates worry about what will happen if there’s just nowhere else for these people to go.
In San Francisco, Lurie’s mayoral predecessor, London Breed, responded to the Grants Pass ruling by promising to be “very aggressive” on tent encampments, including by threatening criminal penalties. Lurie has kept up Breed’s tougher approach, including by more formally embedding their homeless street outreach teams with law enforcement.
While campaigning for mayor last year, Lurie partnered with Dignity Moves, and featured Elizabeth Funk prominently in his campaign’s announcement of his plan to tackle homelessness. Lurie has promised to build 2,500 units of interim housing in his first two years. Modi, the homelessness lead for Lurie’s team in San Francisco, told me their first order of business was to focus on revamping their street outreach strategy and opening a new crisis stabilization center, precisely to serve more people with serious health needs. Now, though, their attention is turning to building the new tiny house options.
Making interim housing less interim?
While advocates for interim housing have pitched the units as short-term “bridge” options to permanent housing, some advocates like Funk say the homes should be available much longer to residents if they do want to live there, perhaps because they don’t mind the space or because they don’t want the hassle of hunting on the private rental market.
“Right now, the average stay is about eight months, but as we start scaling this interim thing, it’s going to get longer, and that needs to be okay,” she told me. “The only reason we want people out fast is because the city has to pay for keeping them in shelter, and cities can’t afford that.”
One of the primary barriers is paying for the cost of meals, maintenance, and social services in these tiny house villages. In San Jose, for example, each village cost about $15 million to launch, but then $3 million to $4 million annually thereafter to operate. When he was mayor, Liccardo said, the city struggled to get any county-level funding to maintain the tiny home villages they built during the pandemic; its millions in operating costs were deemed too expensive.
“What we are opposed to is muddying the definition of what’s actually housing.”
— Alex Visotzky, senior California policy fellow with the National Alliance to End Homelessness
Funk and leaders like Mahan think they have the answer. They are eyeing the federal government’s $3.6 billion voucher program, which currently supports about 2.3 million low-income households. This Housing Choice Voucher program is notoriously hard for recipients to use; one federal study found only 60 percent of those lucky enough to even receive a voucher could find a private landlord willing to accept it. In California last year, over 40,000 voucher recipients never secured housing.
The solution, Funk and her colleagues envision, is allowing the federal rental subsidy to help cities cover those annual operating costs, so people can stay housed and federal subsidies aren’t wasted because renters couldn’t find willing landlords.
To move that idea forward, Liccardo, who represents parts of Santa Clara and San Mateo counties, is working on a bill that would clarify that local communities could decide whether voucher holders are allowed to spend their monthly subsidy on staying longer-term in a tiny house or motel option instead of a market-rate apartment.
Liccardo blasted Republicans who don’t want to spend more money on vouchers, and noted that 60,000 vouchers could disappear by the end of next year if Congress doesn’t act. But he praised his conservative colleagues for being open to “greater flexibility” in how the money could be spent. “If people want to stay in them, great,” he said. “Let’s allow the local communities to decide.”
Visotzky said advocates like himself have no qualms about people staying in shelters when there is nowhere else for them to go, but they worry about creating a new category of substandard living. “What we are opposed to,” he said, “is muddying the definition of what’s actually housing.”
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