That's quite a generalization and simplication of Santa Cruz situation.
A non-trivial percentage of UCSC students are homeless, yes.
That doesn't mean the homeless are literally all students, far from it. Most of them are well past university age and have no association with UCSC.
> The city just hates that it has a UC and refuses to build student housing for it.
Again it's complex. Santa Cruz is a very small slice of land between the ocean and unbuildable steep mountains (a lot of it protected forest land, state parks and so on). It can't expand to the north nor to the south.
The only direction to build is east (towards Watsonville) but transportation there and back is a huge problem so building to the east without addressing transportation won't solve anything.
UCSC itself isn't helping, since they keep driving aggressive student population growths without any regard to where any of them are going to be able to live.
I am actually asking: why shouldn’t the San Francisco’s of the world spend $12 on a banana to ensure that their grocery baggers make $60k a year? This is how we actually fight the problem rather than having arbitrary amounts of low income housing courtesy of Title IX.
If you want to live in an expensive place, be prepared to spend some goddamn money. Or let’s hurry up and get to a post scarcity world. I don’t honestly care how it happens. Just pick and stick.
Homelessness in the US does not correlate with drug use, or else the homeless would be in Appalachia with meth and opioid users. It's in SF because housing is expensive there. And they're locals[1]. Now, they might be getting into drugs, but that's because there's nothing better to do when you're homeless and the police keep taking your stuff.
NYC does better because they build more shelters, but more importantly because New Jersey is next to them and is good at building affordable housing to make up for New York's NIMBYism.
[1] Santa Cruz also has a big homeless problem, and they aren't locals - but they're not druggies either, they're literally university students. The city just hates that it has a UC and refuses to build student housing for it.