"I think we can all agree that we need to do more to clean up encampments," Newsom said in a virtual news briefing.
He said $300 million will go to local jurisdictions as well as Caltrans to remove camps on state property and assist the unhoused with resources and finding other places to live.
"We weren't just cleaning up encampments - out of sight, out of mind - and displacing people, removing people, but that we're trying to resolve the underlying issues in the first place and actually support people in getting them back on their feet to self-sufficiency."
But those receiving the money will be held accountable in making sure the homeless are provided new homes, Newsom said.
"We're not just writing a blank check and hoping things get better. They actually have specific numeric goals, minimum expectations and standards that must be met," he said.
The governor said 13,000 homeless people across the state have already been helped with hundreds of millions of dollars that were previously funded by California. This new infusion of cash, he says, will help at least 10,000 more.
Meghan Marshall, executive director of the California Interagency Council on Homelessness said, "These funds will provide resources for intentional and very deep engagement and offer real and immediate services, which will result in lasting transformations."
Caltrans says it welcomes the funds to help clean up camps near freeways, park and rides and bike paths. They say it's not safe for the homeless, first responders and the traveling public to be in those areas.
"Caltrans is working to connect people experiencing homelessness on its right of way to move to a more secure and stable housing situation offered by local partners," said Alisa Becerra, a Caltrans deputy director.
Henry Lee is a KTVU crime reporter. E-mail Henry at Henry.Lee@fox.com and follow him on Twitter @henrykleeKTVU and www.facebook.com/henrykleefan