SACRAMENTO, CA – In a sweeping move to cement housing, homelessness, and affordability as enduring state priorities, Governor Gavin Newsom announced the formal reorganization of California’s government structure last week, establishing two new standalone agencies: the California Housing and Homelessness Agency (CHHA) and the Business and Consumer Services Agency (BCSA). The reorganization aims to create a clearer, more accountable system to address two of the most urgent and complex challenges facing the state.
The CHHA will serve as the primary agency for coordinating California’s housing and homelessness strategies, while BCSA will oversee business regulation and consumer protection. Both agencies will go into effect on July 1, 2026, when the existing Business, Consumer Services and Housing Agency (BCSH) will be dissolved. The move was approved through a reorganization proposal that took effect last week, after the Legislature allowed it to move forward without objection.
“Housing and homelessness are complex and multifaceted issues — deserving of full and prioritized attention — something we have established within this administration,” said Governor Newsom in a public statement. “I am grateful that the Legislature recognized the need for a new standalone agency dedicated to addressing these vexing issues that continue to face our state and nation, so that these issues will never fall into the shadows again. We have a moral imperative to continue this work and to ensure every Californian has a safe place to call home.”
Since taking office in 2019, Governor Newsom has made housing affordability and homelessness central to his administration’s agenda, pushing through structural reforms and policy overhauls that have included major financial support for local governments, streamlined housing permitting, mental health care transformation, and strong enforcement mechanisms aimed at holding jurisdictions accountable for meeting housing goals.
The creation of CHHA is intended to institutionalize this work. The agency will bring under one roof a number of existing departments, including the Department of Housing and Community Development (HCD), California Housing Finance Agency (CalHFA), the California Interagency Council on Homelessness (Cal ICH), the Civil Rights Department (CRD), and a new Housing Development and Finance Committee. Officials say this structure will enable better alignment of housing programs, financing systems, and civil rights enforcement.
“This is not about bureaucracy for its own sake,” said a senior administration official. “It’s about elevating housing and homelessness to the level of sustained executive focus they demand.”
The Business and Consumer Services Agency will focus on protecting Californians from fraud, abuse, and systemic risks in regulated industries. Its departments will include the Department of Consumer Affairs (DCA), Department of Real Estate (DRE), Department of Financial Protection and Innovation (DFPI), Department of Alcoholic Beverage Control (ABC), and Department of Cannabis Control (DCC), among others. The agency will also house appeals boards and oversight bodies related to cannabis and alcohol licensing.
Tomiquia Moss, Secretary of the current BCSH agency and a longtime advocate for housing justice, applauded the Governor’s decision to separate housing and consumer protection into distinct agencies. “This bold plan shows we are being more aggressive in prioritizing change for the better,” Moss said. “This will enable us to better reach our goal of 2.5 million new homes by 2030, with one million of them being affordable housing. I’m extremely pleased the Governor is cementing his legacy by taking the Administration’s accomplishments to the next level, providing the structure to make lasting and sustainable change.”
The administration emphasized that this change is not only structural but mission-driven. With housing affordability continuing to plague California’s working and middle class, Newsom’s team says the new agency will allow for faster coordination and better use of resources to address the state’s short- and long-term housing needs.
A major priority will be speeding up the construction and financing of housing under California’s various affordable housing programs, while building a continuum of care for individuals experiencing or at risk of homelessness. The agency also seeks to reinforce California’s leadership in civil rights protections by embedding those goals into its housing and homelessness framework.
“This new agency will break down the silos that have historically slowed progress,” said a spokesperson for the Governor. “By placing housing, homelessness, and civil rights under one roof, we’re creating a more nimble, responsive, and people-centered structure.”
The reorganization also comes amid signs that California’s approach to homelessness may be yielding results. From 2014 to 2019—before Newsom took office—unsheltered homelessness rose by approximately 37,000 people. But under Newsom’s administration, that growth has slowed significantly. According to 2024 federal data, while homelessness increased nationally by more than 18%, California limited its overall increase to just 3%. The state also kept the growth of unsheltered homelessness to just 0.45%, compared to nearly 7% nationally.
California also led the nation in reducing veteran homelessness and made progress in reducing youth homelessness, even as other large states like Florida, Texas, New York, and Illinois saw larger increases in both percentage and raw numbers.
Still, advocates caution that long-term progress requires more than administrative restructuring. Many have called for increased investment in deeply affordable housing, stronger tenant protections, and bolder action on the root causes of homelessness including mental health, addiction, wage stagnation, and systemic racism.
The administration insists this reorganization is a step in that direction—designed to sustain and scale its achievements beyond the current political moment.
“We are taking what we’ve already done—hard-won reforms, programs, and momentum—and institutionalizing them,” said Newsom. “This is about making sure that the progress we’ve made doesn’t just last for this administration, but becomes the foundation for the work ahead for years to come.”
