The Brief

When Gov. Gavin Newsom vetoed a bill last month that would have supported sober homeless housing, his reason left many scratching their heads.

Newsom said Assembly Bill 255, which would have allowed cities to use up to 10% of their state funds to pay for “recovery housing,” was unnecessary. That’s because using state funds for sober housing is already allowed, the governor said. He said “recent guidance” makes that clear.

That was a big surprise to Assemblymember Matt Haney, who had spent the past two years working on the bill Newsom was now saying had been moot all along. Haney had been under the impression that California’s “housing first” rule — which dictates that homelessness programs offer housing to people regardless of their sobriety, mental health, employment, etc. — meant sober housing wasn’t eligible for state funds.

When CalMatters asked about the “recent guidance” that allows the state to fund sober housing, the governor’s office sent a link to a 20-page document. No one CalMatters spoke to had ever seen that document before. Neither had Haney, anyone in his office, or the other stakeholders involved in his bill, including the service providers trying to build more sober housing, he said.

While the document was dated July, 2025, it wasn’t published online until Oct. 2 — the day after Newsom’s veto.

“I think it’s a terrible bureaucratic failure,” Haney said of the lack of communication. Having the state and the Legislature work together, rather than on separate parallel policies, would have saved everyone time and resources, he said.

“Why didn’t anybody say anything over the course of two years,” Haney asked, “not just to me, but to the cities, counties and providers who desperately wanted to open these beds?”

The California Interagency Council on Homelessness, which has been working on the document since late 2024, put the blame on Haney’s office for not reaching out. A preliminary draft was publicly available earlier this year as part of a February council meeting, said Executive Officer Meghan Marshall.

The new sober housing guidelines come at a time when the state is facing political pressure from some facets to shift its approach to homeless housing – both to embrace drug-free housing and to turn at least some of its focus from permanent housing that accepts everyone to temporary shelter that may come with strings attached.

A group of legislators, city housing staffers and nonprofits recently took a trip to San Antonio, Texas to tour a massive homeless shelter there, and returned with ideas on how to beef up California’s shelter capacity — which some on the trip say has been neglected as a casualty of California’s strict preference for long-term housing. Meanwhile, President Donald Trump’s administration has signalled that it will shift federal money away from permanent housing and into temporary shelter, while also imposing conditions such as sobriety. California might have to get on board with that agenda, or risk losing federal funds.

While few California Democrats are supportive of anything Trump does, the continued prevalence of encampments on the streets has convinced some that the state should change its tactics.

“We need to break the logjam of the dogma that says that only permanent housing is acceptable,” said Sen. Catherine Blakespear, a Democrat from Encinitas. “Because what we’re de facto saying is that people are going to stay on the streets until we’ve built enough permanent housing or market-rate housing, and neither is on track to meet the need anywhere in the near term.”

But that push has some service providers worried that, in an environment where homelessness funding keeps getting cut, focusing on sober housing and temporary housing will mean less money for the permanent housing that ends people’s homelessness.

“The current trend shifts away from solving the actual lack of a home and focuses on some people’s associated issues,” said Jennifer Loving, CEO of Destination Home.

The debate over sober, temporary, or permanent housing doesn’t address the underlying income inequality that causes many Californians to lose housing in the first place and prevents their being able to afford housing afterward.

The deal with sober housing

California has required state-funded homeless housing be “housing first” since 2016, meaning it gets people into a permanent home as quickly as possible without forcing them to jump through additional hoops. The idea is that once someone is safely housed, it becomes much easier for them to get sober, find a job or take care of other issues.

Haney argues the model prevented the state from funding sober housing, which he said could be lifesaving for people who are overcoming an addiction and don’t want to live next to neighbors using drugs.

The new state guidance says sober housing can be housing first, if it’s done right. It must be the client’s choice to get sober and live in recovery housing, and they must have other local options that don’t require sobriety. In addition, sober housing providers can’t evict someone for relapsing. If a client decides they no longer want to live in sober housing, the provider must connect them to another housing option.

The guidance is more permissive than Haney’s bill. While the bill would have capped state funding on sober housing at 10%, the state guidance has no limit. But Haney worries it’s too strict in other ways. If housing providers can’t evict someone for using drugs or alcohol, they can’t run effective sober housing, Haney said.

“There are some questions as to whether anyone is actually going to step up and do this under the guidelines as written,” he said.

The state guidelines come with no money to open new sober housing beds.

Without extra funding, as more money goes to sober housing, that means less money for low-barrier housing, said Loving, who worries that shift will move the state backward. Sober housing and drug testing were the norm in the 1980s and 1990s, but people still overdosed in those environments, she said.

“Drugs were always present, even in sober living environments,” Loving said. “And that did not increase our housing outcomes. What increased our housing outcomes was the availability of actual houses for people to transition into.”

Temporary or permanent housing?

Several dozen California legislators, city housing workers and nonprofit providers traveled to Texas last month to visit a massive homeless shelter in San Antonio. Haven for Hope fits about 1,500 people on one 22-acre campus — meaning that almost anyone in the city who wants to can sleep indoors. Most of those people are required to stay sober in order to keep their spot, and healthcare, counseling and other services are offered on site.

That program is a sharp contrast from the “discouraging results” of California’s homelessness strategy, said Sen. Dave Cortese, a Democrat from San Jose who went on the trip. He’s frustrated with what he sees as California’s neglect of temporary shelter. New programs such as Newsom’s Homekey only fund permanent housing. So did the Measure A affordable housing bond in Santa Clara County.

Long-term housing is the only way to resolve someone’s homelessness, which is why it has been the gold standard in the state. But it can take years to build, and voters aren’t always patient.

“If you push all your chips to the middle of the table on permanent supportive housing, you start to lose your constituency because constituents are coming by in their cars every day and seeing more tents and more illegal encampments,” Cortese said. “And their thought process is, ‘I thought we just put a billion dollars into eradicating homelessness. What’s going on? Why is it getting worse?’”

An illustration is displayed at The Salvation Army Silicon Valley groundbreaking ceremony for their HOPE Community Safe and Sober Overnight and Transitional Housing program in San Jose on Nov. 3, 2025.

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Nhat V. Meyer

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Bay Area News Group

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Land is scarce and expensive in California, which would make it hard to replicate a shelter as large as Haven for Hope. But city staff in San Jose are looking into whether some version of it can be done there, said Housing Director Erik Soliván, who was on the Texas trip.

While it may seem unusual for the Golden State to look to Texas in search of advice on social services, Californians have been awed by Haven for Hope for years. CalMatters wrote about the phenomenon in 2023.

The Texas shelter has made some changes since then. About 1,600 people slept in the shelter in 2023, and the facility served 85% of the city’s homeless population.

But even that giant facility couldn’t hold everyone. The space was overcrowded, with hundreds of people sleeping on the floor on mats inches apart. Haven for Hope had to pause enrollments and put new rules in place to limit who can come in. In the last fiscal year, the population was down to an average of 1,453 people per night. About 60% of those are in a program that regularly conducts drug and breathalyzer tests.

California will have to do more to embrace that style of shelter if it doesn’t want to get left behind by the federal administration, said Elizabeth Funk, founder and CEO of shelter provider DignityMoves, who went on the Texas trip.

The Trump administration appears poised to divert money away from permanent housing and into temporary housing that comes with sobriety and other requirements. But we won’t know the extent of that change until the government shutdown ends.

“The federal government is going to come down with a bunch of money for things that don’t allow drug use,” Funk said, “and that needs to fit in our system.”

This article was originally published on CalMatters and was republished under the Creative Commons Attribution-NonCommercial-NoDerivatives license.

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Lawyers for a Los Angeles firm representing State Farm in a lawsuit involving the rebuilding of a home after a fire have apologized for artificial intelligence hallucinations in their filings.

The homeowner’s lawyers discovered in motions filed by State Farm “cases that do not exist, quotes that do not exist, and holdings that do not exist,” according to a filing by Eric Khodadian, who is representing Fa’alagilagi Meni-Siliga.

Meni-Siliga filed her lawsuit in July 2024, naming a contractor and the contractor’s insurance company, a public adjuster and her homeowners insurance company, State Farm, as defendants.

A fire in her home in the city of Carson in 2020 caused her home to become uninhabitable, according to the lawsuit. While her contractor was working on the home, a storm caused water damage. After what she said were delays getting State Farm’s approval for repairs, the work on her home was never completed, according to a January court filing. She and her husband have drained their savings and retirement accounts, declared bankruptcy and lost their home to foreclosure, she wrote.

“My family and I have lost forever our family home,” Meni-Siliga, a U.S. Postal Service carrier, wrote. “We do not come from money… It took many years and sacrifice for our family to purchase our home.”

In its original answer to her complaints, State Farm said negligence by the plaintiff, her contractor and public adjuster led to the injuries and damages she suffered. The insurer also said she failed to bring her legal action within a year of the original loss or damage.

The case is set to go to trial in October.

The legal industry is increasingly turning to AI: 41% of law firms and 47% of corporate legal departments said they are using generative AI, according to one recent survey.

That has meant legal "hallucinations" have become more prevalent, said Daniel Ho, a law professor at Stanford University who has researched the issue. In one paper Ho co-wrote last year, he and fellow researchers found that a couple of companies “overstated” that their legal research tools could guarantee hallucination-free legal citations.

A database of legal hallucinations around the world maintained by a Paris-based legal researcher has found 1,922 cases so far; most of them occurred in the United States.

Last year, a California attorney was fined a record amount, $10,000, for using ChatGPT in an opening brief that contained 21 made-up quotes out of 23.

Khodadian shared his findings at an Aug. 7 conference in Los Angeles Superior Court. He wrote in a filing later that a State Farm lawyer was “visibly enraged” afterward and followed him and his co-counsel down the hall, “repeatedly demanding to see the list” of mistakes they had found.

That lawyer was Kenneth Katel of the firm Musick, Peeler & Garrett, who in his filing apologized to the court and to the plaintiff, explaining that his co-counsel told him she used AI to help prepare some filings.

“I was not aware that AI had been used, but as lead trial counsel I accept full responsibility for our filings,” Katel wrote. He also told the court that his firm has updated its policy about AI use but did not provide specifics.

Katel disputed Khodadian’s characterization of what happened after the hearing, though he wrote “it is accurate to say I was upset given the seriousness of the allegations.”

Khodadian and Katel declined to answer questions from CalMatters.

The lawyer who used AI in motions on behalf of State Farm, Jacquelene Robinson, wrote in a filing that she confirmed there were seven case citations across eight filings “that simply didn’t exist,” as well as some incorrect titles of cases and quotes that were not found in cases she cited.

Robinson said she used an AI tool called Irys, which she incorrectly thought was tied to her law firm’s subscription to a legal research tool called Westlaw, which she thought “performed an internal cite check.” She was mistaken, she wrote.

State Farm is reviewing what happened, spokesperson Tom Hartmann said. “State Farm expects its external counsel to conform to the highest level of ethical standards and professionalism, including confirming the accuracy of all legal filings,” he said.

Hartmann did not respond to questions about how many external law firms represent State Farm, and whether the company asks about their AI policies before hiring them.

This article was originally published on CalMatters and was republished under the Creative Commons Attribution-NonCommercial-NoDerivatives license.

Progressive Jane Kim, one of two Democratic candidates for California insurance commissioner, is betting that voters are as hungry for change as those who powered Zohran Mamdani into New York City's mayor's office and Abdul El-Sayed into Michigan's U.S. Senate race after the Democratic Party endorsed her rival, state Sen. Ben Allen.

How it plays out could rest on how engaged voters will be about an elected position they may not know much about; how much weight disillusioned voters give to the state party's endorsement; and how much they respond to ads and mailers that they’ll be bombarded with ahead of the November election.

Kim, a former member of the San Francisco Board of Supervisors, is squaring off against Allen to become the regulator of the state’s massive insurance market. Kim wants to establish state-run natural disaster insurance for all and expand low-cost auto insurance to all California drivers, in line with well-known progressive ideas like Medicare for All. Allen wants to stabilize and improve the private insurance market after years of availability and affordability problems largely driven by increased wildfire risk and massive, deadly wildfires.

Kim’s message has struck a chord with many Californians: She got the most votes, more than 27%, among the 11 candidates on the ballot in the June primary. Allen came in second with more than 19%.

“(Kim and Allen are) a microcosm of the fracture going on in the Democratic Party across the country,” said Shauhin Talesh, a law professor at UC Irvine whose expertise includes insurance and consumer protection. “They both think insurance companies should be regulated. The question: How aggressively should California intervene and what role should the government claim?”

Allen recently secured the California Democratic Party’s endorsement, which Talesh said wasn’t surprising because the senator is seen as a more “traditional” candidate.

Kim, whose accomplishments include securing free community college for San Francisco residents and the state’s first $15 minimum wage, was the director of the California Working Families Party, a party within the Democratic umbrella that supports progressive policies including raising the minimum wage. She is backed by U.S. Sen. Bernie Sanders, on whose presidential campaign she worked in 2020.

“Is this going to become another situation where people are speaking with their votes (and going against the establishment)?” Talesh asked. “At what point does Democratic Party recognize it?”

But Kim isn’t just lacking the state party’s endorsement. The insurance industry is, not surprisingly, leery of her plans to have the state play a greater role in insurance. So are some consumer advocacy groups such as Consumer Watchdog, whose founder wrote the ballot initiative that became the state’s insurance law.

Jamie Court, president of the group, warned that a state-run natural disaster insurance fund — which Kim says would be funded by portions of premiums policyholders pay to their insurance companies — would require tens of billions of dollars to start, which he said could be wiped out by one catastrophic fire.

Kim has said that while her proposal would require further study, her critics fail to address that there needs to be more discussion and “public engagement to reform the system.”

“I don’t think just allowing the insurance industry to raise rates is the solution,” she told CalMatters in an interview. “People will lose their homes or go uninsured. And that will wreck the economy.”

Allen told CalMatters that his opponent’s proposal “is effectively a massive subsidy for those who are rich” because their homes will cost more to replace after a fire.

Maurice Mitchell, national director of the Working Families Party, said Kim’s message is resonating with Californians because of “a populist wave, not a progressive wave” nationwide.

He noted that primary results showed Kim did well in historically conservative areas such as the Inland Empire and the Central Valley, as well as in Los Angeles County — which includes Allen’s district.

Considering those results, Jorge Contreras, California director of the Working Families Party, called the state Democratic Party’s endorsement of Allen “out of touch.”

Some delegates for Kim complained their votes did not seem to be counted; Kim called for a recount.

“The votes were counted,” said Robin Swanson, spokesperson for the party. “And recounted. The result was the same.”

Insurance Commissioner candidate Ben Allen delivers remarks during the California Democratic Party convention at Moscone Center in San Francisco on Feb. 21, 2026.

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Yalonda M. James

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San Francisco Chronicle via AP

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Contreras noted that the next day, the California Labor Federation endorsed Kim.

Not everyone buys the "moderate" label being pinned on Allen — including at least one of his own supporters.

“Ben is a progressive by any standard,” said RL Miller, former chair of the California Democratic Party’s Environmental Caucus who also runs a political action committee, Climate Hawks. The group doesn’t endorse in California races, but Miller said she personally endorsed Allen.

“He’s stood with us and authored landmark climate bills over the years,” Miller said, adding that the “tribal nature of Democratic politics these days” might be the reason Allen is being seen as the more moderate candidate.

Allen has a strong track record on the environment, including his work on Proposition 4, the $10 billion bond measure approved by voters in 2024, which includes funding for wildfire prevention. He also authored the law that decreases the use of single-use plastics.

Allen’s votes have also been more aligned with some of the same groups now supporting Kim, including the California Labor Federation. The senator’s record has generally not aligned with business interests, according to CalMatters’ Digital Democracy database.

Though both candidates have pledged not to take money from the insurance industry, Contreras said it’s important to follow the money in this race.

Business groups spent $1.5 million to oppose Kim’s primary campaign, mostly from JOBSPAC, a coalition of employers sponsored by the California Chamber of Commerce, according to Digital Democracy.

Meanwhile, Contreras said “Ben Allen has taken crypto money, which came in big for him at the end.” Campaign finance records show billionaire Chris Larsen, co-founder of crypto company Ripple, in May gave $1 million to the PAC sponsored by California Environmental Voters, the biggest outside spender supporting Allen’s campaign.

Contreras said billionaires are going to spend a lot of money supporting moderates this election cycle: “Why? Because they want the status quo. Jane is now going to be the bogeyman.”

Jane Kim speaks to supporters during an election night party at El Rio in San Francisco on June 2, 2026.

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Beth LaBerge

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KQED

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The biggest contributors to Kim’s campaign are the California Working Families Party and the California Teachers Association, which gave about $365,000 and $150,000 each, respectively.

The main difference between this battle and other contests going on elsewhere is that many voters don’t know exactly what the insurance commissioner does, said Kevin Liao, a Democratic political consultant who briefly worked on Allen’s campaign before leaving to work on Tom Steyer’s gubernatorial campaign during the primary.

That could mean that voters will rely on shortcuts such as Sanders’ endorsement of Kim, or the California Democrats’ endorsement of Allen. The race could come down to whose brand will convince voters, he said.

“We’re at a moment when voters, certainly the base of the Democratic Party, are fed up with the party establishment,” Liao said.

But not all candidates with more progressive ideas have found success: In California, the progressive Steyer failed to advance to the general election. Recently, David Crowley, a moderate Democrat, beat Francesca Hong, a democratic socialist, in the Democratic primary for Wisconsin governor by less than a percentage point.

This article was originally published on CalMatters and was republished under the Creative Commons Attribution-NonCommercial-NoDerivatives license.