San Luis Obispo County and nonprofit Restorative Partners upped their request to the Homekey+ grant program after promising that the newly rehabilitated Sunny Acres property would earmark housing for veterans.
Last year, the pair applied for $7 million—a slice of the $2 billion state grant for the homeless—managed by the California Department of Housing and Community Development (HCD).
The grant money would help transform Dan DeVaul’s once-troubled sober living program into a “healing and restoration campus.”
After a frustrating year of starts and stops with HCD, Restorative Partners and the county are submitting an amended application for $10 million.
“HCD, our state grantor, though working with them has been tedious, time-consuming, but timeless in learning curve,” Restorative Partners founder Theresa Harpin said at the July 7 Board of Supervisors meeting.
The supervisors adopted a revised resolution approving the new application’s submittal. This time, six of the proposed 34 permanent supportive housing units are for veterans.
Principal Administrative Manager George Solis with the county’s Homeless Services Division told New Times that starting on Aug. 7, all applications would be prioritized based on the inclusion of units for veterans. Homekey+ guidelines were amended in March.
“The state increased the amount of funding projects can receive for construction and rehabilitation, reduced the amount of local matching funds required from counties and nonprofit partners, and broadened eligibility so that more types of properties, such as older or previously funded buildings, can qualify for assistance,” Solis said. “The amendments also add specific incentives for projects that dedicate units for veterans, including higher allowable capital costs and additional operating support.”
Homekey+ is the permanent supportive housing component of the Behavioral Health Services Act included in Proposition 1, which California voters passed in the 2024 primary election. The grant money became available after HCD and the California Department of Veterans Affairs (CalVet) released notice of funding availability in November 2024.
According to the county staff report, HCD and CalVet adopted changes to grant guidelines to boost the use of under-requested funds dedicated to veterans and recognize the real-world costs of providing permanent supportive housing for people with behavioral health needs.
Homekey+ isn’t the only grant that supports the planned campus. A $4.4 million operating grant from the California Board of State and Community Corrections would fund reentry programming and supportive services, according to Solis.
Despite past delays, he’s optimistic that the HCD will eventually award the county and Restorative Partners with the Homekey+ grant.
Solis added that the requested jump from $7 million to $10 million reflected market-tested construction pricing, prevailing wage requirements, historic rehabilitation needs, infrastructure improvements, and occupied site logistics.
The proposed project includes converting an 8,000-square-foot boarding-style “horseshoe” building into 34 private housing units. Renovations would include electrical and plumbing upgrades, ADA improvements, installing fire sprinklers, and exterior repairs.
The incoming health campus would usher in a new era for the former Sunny Acres site, which followed a controversial labor-intensive harm reduction model under its late founder DeVaul and was riddled with code violations.
“The recent Homekey+ updates provide additional opportunities to strengthen the project, and we appreciate the continued collaboration with the county and the state,” Restorative Partners said in a statement to New Times. “While the application is still under review, our focus remains on developing a project that will provide long-term housing stability and supportive services for those who need them most.” ∆
This article appears in July 16-23, 2026.
