Apple pledges $2.5 billion to fight California’s homeless crisis and build affordable housing in the state

Apple has pledged $2.5 billion toward easing a housing shortage that has driven up prices across California.

Of the donation, $1b will go to fund which will be jointly run with state officials, and is aimed at jumpstarting delayed or stalled affordable housing projects. 

Another $1b will go to a state-run fund to provide first-time home buyers financial assistance to teachers, nurses and first responders such as police and firefighters, among others.

The other $500,000 will go toward  toward efforts specific to Apple’s home region in Northern California, where fast-growing tech companies have drawn protests from residents who blame them for rising housing costs, with the median home price has risen to $1.4 million.

In an interview, Apple Chief Executive Tim Cook said the company felt a ‘profound responsibility’ to improve California’s housing crisis. 

Apple’s current headquarters – a ring of gleaming metal and glass nicknamed the ‘spaceship’ in Cupertino, California – sits less than five miles from the suburban family home where co-founders Steve Jobs and Steve Wozniak assembled the first Apple computers in the 1970s.

‘We want to make sure that it is a vibrant place where people can live and also raise a family,’ Apple Chief Executive Tim Cook told Reuters in an interview. ‘And there’s no question that today that isn’t possible for many people, that the region suffers from an affordability crisis that is existential.’

The move comes after Facebook and Alphabet Inc-owned Google both committed $1 billion toward California housing initiatives while Microsoft committed $500 million in the Seattle, Washington area.

Apple said the project-financing fund was the first of its kind. Real estate developers often secure bonds for affordable housing development but must service the debt during construction until the houses are built and start to generate revenue. 

‘Before the world knew the name Silicon Valley, and long before we carried technology in our pockets, Apple called this region home, and we feel a profound civic responsibility to ensure it remains a vibrant place where people can live, have a family and contribute to the community,’ said Apple chief executive Tim Cook in a statement.

‘Affordable housing means stability and dignity, opportunity and pride. When these things fall out of reach for too many, we know the course we are on is unsustainable, and Apple is committed to being part of the solution.’

Apple and state officials hope to provide bridge financing during construction at rates below those from commercial lenders.

Apple said the funding could take two years to deploy but that it hopes to recycle the funding for future projects over five years.

Apple said data showed some 30,000 people left San Francisco between April and June of 2019 and that its efforts are geared to help ‘community members like teachers, firefighters, first responders and service workers’ who cannot find affordable lodging. 

‘This unparalleled financial commitment to affordable housing, and the innovative strategies at the heart of this initiative, are proof that Apple is serious about solving this issue,’ California Governor Gavin Newsom said in a statement.

The $2 billion in funding will be deployed across California, while the remaining $500 million will go toward efforts specific to Apple’s home region in Northern California, where fast-growing tech companies have drawn protests from residents who blame them for rising housing costs.

Apple will make available about 42 acres of land in northern San Jose, California valued at $300 million on which it hopes nearly 3,800 affordable housing units can be built. 

It will also donate $150 million to a Bay Area affordable housing fund and $50 million to Destination: Home, a public-private group addressing homelessness in Silicon Valley, home to some of the world’s most valuable public companies.

‘Tech has grown a lot, and it has become a larger portion of the economy,’ Cook said. ‘We’d like to be part of the solution, so that’s why we’re jumping in.’

‘We have worked closely with leading experts to put together a plan that confronts this challenge on all fronts, from the critical need to increase housing supply, to support for first-time homebuyers and young families, to essential philanthropy to assist those at greatest risk,’ said Lisa Jackson, Apple’s vice president for environment and social initiatives. 

Although Californians earn some of the highest wages in the country, this has done little to combat the growing level of homelessness.

The state has been singled out as having the highest poverty rate. 

According to the Public Policy Institute of California, almost four in ten residents are living in or near poverty in 2017. 

It’s reported that around 130,000 people are homeless in California, equaling to half the population of Orlando, Florida.  

In places like San Francisco, the realities of the homeless crisis is becoming dire as tent cities are becoming more common and residents are clashing with homeless. 

Just a week ago, a frustrated neighbor erected a plywood wall to keep homeless people from using a neighborhood alleyway as a public toilet. 

‘Ingleside Path’ in the Ingleside neighborhood reportedly would urinate and relieve themselves in the alleyway multiple times a day.

The neighbor told ABC 7: This walkway has been a burden on city resources for some time now. The walkway requires multiple trips a week for power washing and city records confirm that over 100 calls were received for emergency services. 

In September, neighbors in Clinton Park combined their money to purchase two dozen boulders and placed them on a residential sidewalk to keep the homeless from setting up camp.

Both instances have been critiqued by activists who call them ‘hostile architecture.’  

Jeff Kositsky, the director for the Department of Homelessness and Supportive Housing, estimates that 20,000 homeless people reside or pass through San Francisco any given year. 

Even with the rise of the homeless crisis and residents calling for action, only five percent of the city’s total budget is used to combat homelessness.  

In the tenderloin district, a series of drug addicts and the homeless have pushed residents to their wits end. 

Homeless people reportedly leave behind used needles and defecate on the ground.  

In response, San Francisco set up public toilets and formed the ‘poop patrol’, a special six-person team tasked with cleaning up the feces around San Francisco, was announced.

San Francisco also funded an initiative to hire people to collect used needles off the street.

California’s housing crisis, specifically San Francisco, has been publicly targeted by President Donald Trump.

Trump visited California in mid-September and publicly denounced the city’s homeless crisis. 

He said it was the result of ‘liberal policies’ and said city officials were allowing waste to filter into storm drains leading to the ocean. 

‘It’s a terrible situation that’s in Los Angeles and in San Francisco,’ Trump said of the issue.

The Environmental Protection Agency sent a letter to Newsom and said California was failing to protect residents from ‘degraded water.’

The letter read: ‘California needs to fulfill its obligation to protect its water bodies and, more importantly, public health, and it should take this letter as notice that EPA is going to insist that it meets its environmental obligations.’

‘If California does not step up to its delegated responsibilities, then EPA will be forced to take action.’ 

The letter directly linked the alleged water pollution to the homelessness crisis. 

Although the federal government wants California cleaned up, they’re unwilling to pay for it. 

Secretary Ben Carson of the Housing and Urban Development rejected a housing aid request from Newsom and the mayors of the state’s 13 biggest cities.

The request asked for additional resources to fight homelessness, including 50,000 housing vouchers for low income residents. 

Carson said: ‘Your letter seeks more federal dollars for California from hardworking American taxpayers but fails to admit that your state and local policies have played a major role in creating the current crisis.’

He implied that California’s housing problem was sanctuary city policies, law enforcement policies and an over-regulated housing market.