In a ruling out this morning, the Supreme Court said that a city can fine someone or put them in jail for camping or sleeping in public even if that person is homeless and has nowhere else to go.

In the case, City of Grants Pass v. Johnson, a federal court had previously said that the city’s anti-camping laws were cruel and unusual punishment, and thus unconstitutional. As in many cities, the town doesn’t have adequate shelter space. (The only shelter available, run by a Christian organization, says residents have to attend daily religious services and can’t socialize with the opposite sex except at approved events, among other restrictions.)

With this ruling, cities without shelter space are free to evict people living in parks and put them in jail or issue steep fines. We talked to Shaun Donovan, the Obama-era head of the Department of Housing and Urban Development and current CEO of the nonprofit Enterprise Community Partners, about the case and what cities should actually be doing to help end homelessness.

Fast Company: What impact will this ruling will have?

Shaun Donovan: It sends a signal that this is a “solution” to homelessness. And the primary thing that I think is so important for every community, every person in the country to understand is that it is very clear that this is a phony fix for homelessness. It does not work to criminalize homelessness. We have evidence that all it does is make homelessness worse. Moving people around does not end homelessness. Housing ends homelessness.

If more cities now start fining or jailing people for sleeping on the street, what are some of the ways that can make homelessness worse?

Criminalizing homelessness, not unsurprisingly, increases homelessness, not decreases it. If you’re a person who is desperately seeking housing, a job, assistance of various forms, having a criminal record makes all of those things more difficult. And to be clear, what we’re talking about here is just specifically the ability of a city to criminalize someone even when there are no housing options available. That’s tragic: to say we’re going to take someone who is already suffering from the most fundamental deprivation of sleeping on the streets and criminalize that, and make it even harder for them to find housing.

What should cities be focused on instead?

If you want to end homelessness, we know what ends homelessness. It is housing with services. So finding a way to do more of that, independent of [this] legal outcome, is the most important thing. We know that supportive housing ends homelessness. We know that it saves lives. And for every dollar you spend on supportive housing, the CDC found that there was $1.44 in savings.

A lot of cities have embraced a “housing first” approach, meaning providing stable housing with supportive services as a first step for people who are homeless. How well has that worked?

I would partly go back to my own personal experience when I was HUD secretary. We really prioritized “housing first” across the country for the first time, and we saw a dramatic reduction in homelessness. We cut family and chronic homelessness by about a third. Veteran homelessness was down by half across the country. Working with mayors and governors who were particularly effective and focused on the right solutions, we ended veteran homelessness in more than 100 cities and states—not reduced it, but ended it. There are lots of current examples, cities like Houston, where there’s more than a 50% reduction in homelessness.

The problem is that there is deliberate misinformation that’s coming out about housing first, and I’m concerned that the Grant’s Pass decision could compound that. The Cicero Institute and others are fighting against housing first in ways that are completely contrary to the evidence and to what we know ends homelessness. That puts at risk the progress we’ve made.

There’s a “moral” argument that’s made [against] prioritizing housing for people who may be struggling with substance abuse or mental illness. [They want to go] back to requiring that someone go through a substance abuse program or AA and stop behaviors before getting access to housing. We know it’s incredibly hard to succeed at that when you are living on the streets. In fact, there is now an enormous amount of evidence that you’re much more likely to succeed at taking your medication and ending substance abuse when you’re stably housed.

Beyond supportive housing, what else needs to happen to end homelessness?

To be clear, permanent supportive housing is a solution for a share of those who are experiencing homelessness. The Grant’s Pass case is focused on encampments and those living on the streets, and there’s a tendency to focus on the chronically homeless. But the vast majority of the homeless just need a home. The fundamental issue is that we are seeing the worst housing affordability crisis in this country in the history of keeping those numbers. We saw an 18% year-over-year increase on rents during COVID. There is an enormous amount of data and work that’s been done to show that the answer to homelessness is more homes. And that it is really a housing problem. If you look at where poverty is high, you often have low homelessness [because there is enough housing available, and that makes it affordable]. It really is where rents are high where homelessness is biased. There is a great book by Gregg Colburn, called Homelessness is a Housing Problem, that really lays out this evidence very effectively.

How much has that changed in lower-cost cities as the cost of housing has gone up so much?

Having worked in this field for 30 years, I would say that what is really different is that there is now a housing challenge just about everywhere in a way I haven’t seen before. There’s a rental crisis in Boise, Idaho, or Bozeman, Montana, or in Buffalo or in rural New Mexico. It’s the breadth of the challenge that is really remarkable right now.

How much progress do you see in terms of building more housing?

In red states and blue states, I’m seeing enormous focus on this issue of how do we just create more housing. How do we change our zoning and our regulatory process? How do we put more dollars into the Low Income Housing Tax Credit? There are many ways to create more housing. But over 30 governors this year have already talked about housing in their “state of the state” addresses and what they want to do to create more housing. There are many examples—Colorado, Montana, Arizona, Florida—states all along the political spectrum who have passed strong laws this year. They’re really pushing forward this question of how you create more housing through all the tools that are available. And that fundamental shortage is driving homelessness more than anything else.