Tanya said she spends her days near the Housing Matters campus on Coral Street. (Nik Altenberg — Santa Cruz Local)

Update 4:30 p.m. Friday, Oct. 17: Housing Matters announced the proposed service cuts on Friday morning. In an interview, Housing Matters CEO Phil Kramer said the decision was related to the nonprofit’s under-construction 120-unit permanent supportive housing project Harvey West Studios. Kramer said the organization has “finite resources” and also wants to focus on fostering a safer environment for residents. 

“Casa Azul has been a really eye opening experience and has informed this decision in that we recognize that we need to do a better job at providing a safe, welcoming, conducive-to-healing environment as [residents] stabilize in their new housing environment,” Kramer said. Casa Azul is Housing Matters’ seven-unit permanent supportive housing project across the street from its Coral Street campus. An 18-month old toddler died of a fentanyl overdose at Casa Azul last year. 

Kramer called the decision to shutter the Day Services program “heart-wrenching” and said about 50 to 80 people utilize drop-in day services on any given day. “Many of the people that are receiving those services may not have alternative locations or ways to access those services, so I think that makes it all the more difficult,” he said. Kramer said the services are now expected to shutter in March 2026.

Editor’s note: this story has been updated to reflect that the City of Santa Cruz is responsible for the homeless sweeps, not Housing Matters.

According to Santa Cruz County’s 2025 point-in-time homelessness count, there were 1,473 people experiencing homelessness across the county, 1,122 of whom were unsheltered. 

The cuts to services also come as the City of Santa Cruz has conducted weekly sweeps of Coral Street in front of the shelter for more than a year. 

People camping on the sidewalks, by the tracks and on the sides of the street were cleared Thursday morning, said Michael Sweatt, a resident at one of the shelters on the Housing Matters campus. 

Michael Sweatt said he’s been homeless in Santa Cruz for many years and is now living at a shelter at Housing Matters’ Coral Street campus. Sweatt said he’s taking a community health class at Cabrillo College and wants to help homeless people get back on their feet. (Nik Altenberg — Santa Cruz Local)

Sweatt said he had not heard of the planned cuts but noted that Housing Matters recently purchased a 20-room hotel in Live Oak as temporary housing for homeless people. Housing Matters also began construction on 120 units of permanent supportive housing on its Coral Street campus last year that are expected to finish construction by August 2026, Housing Matters CEO Phil Kramer wrote in an email in May. 

“Everybody who’s out here on the street now” is expected to be housed there, he said, adding that counting on it can be “iffy” at times. “They’ll say something and they might do it, but it might take a year or two when it needs to be done now,” he said. 

Until then, homeless people will have to seek those resources elsewhere after Day Services closes. 

Tanya, 57, who gave only her first name, said she sleeps at the Armory Shelter near DeLaveaga but spends her days near the train tracks that cross Coral Street. She said she has been using the Day Services center at Housing Matters for a long time. 

“It does help out, especially for the information and other resources,” she said. Tanya said she has been homeless on and off for 16 years, and the current bout without stable housing began about six months ago. 

Several volunteers with Youth With a Mission were at Coral Street on Thursday afternoon. 

“I think it’ll bring the morale down, people look forward to having a shower,” said Noah Chapman, 19, who volunteers with the Santa Cruz Mountains-based Christian group. He said they bring “food and prayer” to people experiencing homelessness.

Santa Cruz County Supervisor Justin Cummings said Thursday he’d heard rumors of the Day Services closure, but that the nonprofit hadn’t yet discussed it with the Board of Supervisors. He said he’s concerned about potential fallout from the services being cut. 

“If we’re supposed to be partners in this, then we’re having conversations about what’s going to happen, what’s going to be the decision that’s made, because it can have some unintended consequences,” Cummings said. “Not just for the homeless population but also the relationship we have with Housing Matters should they move in that direction.”

He said he plans to follow up with Housing Matters in the nonprofit’s monthly check-in with city and county officials next week.

Correction: This story has been updated to reflect the correct number of unsheltered people in the 2025 point-in-time count. 

Homeless people were cleared from Coral Street Thursday morning. By the afternoon, a handful of tents had popped up again. (Nik Altenberg — Santa Cruz Local)

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