(c) Provided that before proposing to use round 5 resources to fund new interim housing solutions, the applicant first demonstrates that the region has dedicated sufficient resources from other sources to long-term permanent housing solutions, including capital and operating costs, allowable uses of round 5 base program allocation funds include all of the following:

1. (1) Permanent housing solutions, including all of the following:

   1. (A) Rental subsidies, including to support placement of individuals in CARE Court.
   2. (B) Landlord incentives, such as security deposits, holding fees, funding for needed repairs, and recruitment and relationship management costs.
   3. (C) Move-in expenses.
   4. (D) Operating subsidies in new and existing affordable or supportive housing units serving people experiencing homelessness, including programs such as Homekey, new or existing residential care facilities, funded by the Behavioral Health Continuum Infrastructure Program or the Community Care Expansion Program. Operating subsidies may include operating reserves.
   5. (E) Homelessness prevention through rental assistance, rapid rehousing, and other programs, so long as they prioritize households with incomes at or below 30 percent of the area median income, who pay more than 50 percent of their income in housing costs, and who meet criteria for being at highest risk of homelessness through data-informed criteria adopted by the council.
   6. (F) Problem-solving and diversion support programs that prevent people at risk of or recently experiencing homelessness from entering unsheltered or sheltered homelessness.
   7. (G) Services for people in permanent housing, so long as the services are trauma-informed and practice harm reduction, to include intensive case management services, assertive community treatment services, critical time intervention services, other tenancy support services, evidence-based employment services, coordinating mental health, substance use, and primary care treatment, or other evidence-based supportive services to increase housing retention.
   8. (H) Capital for permanent housing that serves people experiencing homelessness, including conversion of underutilized buildings or existing interim or transitional housing into permanent housing.

2. (2) Interim housing solutions, including all of the following:

   1. (A) Navigation centers that are low barrier, as defined in Sections 65660 and 65662 of the Government Code, to include any of the following:
   2. (B) Operating expenses in existing congregate shelter sites.
   3. (C) Operating expenses in new or existing noncongregate shelter sites and transitional housing for youth.
   4. (D) Motel or hotel vouchers.
   5. (E) Services provided to people in interim housing, to include trauma-informed and evidence-based intensive case management services, housing navigation, connecting people to substance use or mental health treatment, public benefits advocacy, and other supportive services to promote stability and referral into permanent housing.
   6. (F) Capital funding to build new noncongregate shelter sites, including for construction, rehabilitation, and capital improvements to convert existing congregate sites into noncongregate sites.
   7. (G) Capital funding for clinically enhanced congregate or noncongregate shelter sites.
   8. (H) Youth-focused services in transitional housing.

3. (3)

   1. (A) Services for people experiencing unsheltered homelessness, including street outreach, including, but not limited to, persons experiencing homelessness from encampment sites and those transitioning out of encampment sites funded by the program known as the Encampment Resolution Grant consistent with Section 50251 to access permanent housing and services. This includes evidence-based engagement services, intensive case management services, assertive community treatment, housing navigation, harm reduction services, coordination with street-based health care services, and hygiene services for people living in encampments and unsheltered individuals.
   2. (B) Services coordination, which may include access to workforce, education, and training programs, or other services needed to promote housing stability in supportive housing.
   3. (C) Systems support for activities necessary to create regional partnerships and maintain a homeless services and housing delivery system, particularly for vulnerable populations, including families and homeless youth.
   4. (D) Improvements to existing emergency shelters to lower barriers and increase privacy.
   5. (E) Any new interim sheltering funded by round 5 funds must be low-barrier, comply with Housing First as provided in Chapter 6.5 (commencing with Section 8255) of Division 8 of the Welfare and Institutions Code, and prioritize interventions other than congregate shelters.
4. (4) A program recipient shall not use funding from the program allocated under this section to supplant existing Encampment Resolution Grant funds provided under Section 50251.

(d)

1. (1) Applicants may request, in a form prescribed by the council, approval to utilize round 5 funding on allowable expenditures outside of the state’s intended priorities, as enumerated in this section.
2. (2) The council may grant applicants preapproval to utilize program funding on allowable uses only after an applicant has demonstrated that state priorities are adequately resourced, and the applicant has exhausted all means to accomplish these priorities.

(f)

1. (1) The council may authorize an applicant to use up to an additional 1 percent for costs related to the Homeless Management Information System. Related costs include Homeless Management Information System licenses, training, system operating costs, and costs associated with carrying out related activities.
2. (2) Upon agreement between the grantee and the Homeless Management Information System lead entity, the grantee shall transfer the authorized amount of funds pursuant to paragraph (1) for related costs to the Homeless Management Information System lead entity. The council shall specify the method and manner for this transfer of funds.