California Spent $17 Billion on Homelessness. It’s Not Working

The Wood Street encampment for years drew people with nowhere to live, until a fire made finding a solution an urgent—and frustrating—task.

OAKLAND, Calif.—City firefighters arrived midmorning at a homeless camp on Wood Street to quell a fire spreading across a tinderbox landscape of discarded furniture, debris, abandoned cars and dwellings fashioned from tents, tarps and plywood. 

Fire crews struggled for more than two hours. There weren’t enough hydrants because no one was ever supposed to live on the stretch of dirt that snaked beneath Interstate 880, the freeway connecting Oakland and San Jose. Yet over six years, the property had become home to more than 300 homeless people—addicts, the mentally ill and those unable to get a grip on Bay Area housing with a warehouse job or a construction gig.

The fire last summer spit thick black smoke that temporarily halted commuters. Soon after, the California Department of Transportation, which owned most of the land, announced it would start tearing down the makeshift shelters. The July 11 fire appeared to have done what state and local officials had failed to do—force a decision to clear the camp.

A monthslong legal and bureaucratic battle followed, in a display of the humanitarian, practical and political forces trying, with limited effect, to solve the urban homeless problem.

The number of homeless people in California grew about 50% between 2014 and 2022. The state, which accounts for 12% of the U.S. population, has about half of the nation’s unsheltered homeless, an estimated 115,000 people, according to federal and state data last year. It also has among the highest average rent and median home prices in the U.S.  

State officials said it was the city’s responsibility to house people kicked off the Wood Street property. Oakland officials said they didn’t have enough shelter beds. Residents fortunate enough to get a federal housing voucher struggled to find an apartment they could afford with it. Many of the drug addicts and mentally ill on Wood Street wanted nothing more than to be left alone.

About 30 people filed a federal lawsuit against the state transportation department, known as Caltrans, and the city of Oakland for the right to continue living at the Wood Street encampment. They were among those who initially rejected spots at shelters because they couldn’t bring their pets or all their belongings.

“You have to give up everything you own just for a place to sleep for a night,” said Jaz Colibri. She was one of those who filed the lawsuit, which after months of back and forth was decided against her and the others.  

By March, those who resisted authorities were still living on a sliver of the property that the Oakland Fire Department called unsafe, unsanitary and which posed “a range of public health risks for the unhoused people living there, neighbors in the surrounding area, and the firefighters who respond to incidents 24 hours a day.” 

The fire department said it had been called to 816 fires at homeless camps in Oakland during the year that ended in October 2022, including 63 around the Wood Street camp. Fires spread out of control mostly by people cooking with propane tanks or burning materials for heat, the department said.

“When you have these homes that are fabricated, and you have open flames, there’s going to be fire incidents,” Reginald Freeman, then the city fire chief, said after the fire last summer.

California spent a record $17 billion combating homelessness in the past four fiscal years. For the state budget year starting in July, Gov. Gavin Newsom has proposed another $3.7 billion. 

Voters in Los Angeles and San Francisco, which have some of the largest homeless populations in California, were unhappy enough about it to approve taxes costing them billions of dollars to fund anti-homelessness programs and housing in recent years. So far, cost overruns and delays have left little to show for the money.

State and local officials have bickered over responsibility. Mr. Newsom late last year threatened to withhold funding from local governments that he believed weren’t attacking the problem aggressively enough. That included programs to move squatters, willingly or not.