Advocates Call the Trump Administration’s Funding Changes a Betrayal that Would Devastate Housing Programs Nationwide
President Donald Trump’s administration is attempting to revamp funding criteria for an important program that local governments and nonprofits use to prevent people from becoming homeless, a move that advocates say could cause 170,000 people to lose their housing.
The Department of Housing and Urban Development plans to publish new guidance for the Continuum of Care program in its upcoming 2025 Notice of Funding Availability. The new guidance includes a provision to cap the amount of money local organizations can spend on permanent housing to 30% of their total funding. It also includes anti-Diversity, Equity, and Inclusion measures that would reduce funding for organizations that use any type of racial preference or recognize gender-nonconforming individuals.
Overall, the changes could erase more than $1 billion of available funding. It could also cause more than 170,000 people to lose their housing, according to an analysis by the National Alliance to End Homelessness.
“People all over this nation have overcome homelessness and stabilized in HUD’s permanent housing programs,” NAEH CEO Ann Oliva said in a statement. “Many are just beginning that process and getting a shot at a new life.”
“HUD’s new funding priorities slam the door on them, their providers, and their communities,” Oliva continued. “Make no mistake: homelessness will only increase because of this reckless and irresponsible decision.”
A HUD spokesperson told Politico that the decision was made to improve the “success” of housing programs.
“HUD is no longer in the business of permanently funding homelessness without measuring program success at promoting recovery and self-sufficiency,” the spokesperson said. “There will be more news on this much-needed paradigm shift soon.”
Previous Attempts to Withhold Funding Faced Legal Pushback
This is not the first time that the Trump administration has tried to strip funding from homeless service providers. In May, the administration attempted to withhold previously approved funding for homeless services until providers agreed to anti-diversity policies.
Eight local governments sued the Trump administration over the policy change. A federal judge in Rhode Island ruled that same month that the Trump administration’s efforts to rescind the funding were illegal, but that didn’t stop the administration from continuing to try to withhold the funds.
In September, the administration attempted to tie federal grant funding for homeless services to “support sanctuary protections, harm reduction practices, or inclusive policies for transgender people.” Groups that supported such policies would no longer receive federal support, according to a lawsuit filed by service providers.
A federal judge in Rhode Island also blocked that effort by the administration. Plaintiffs argued that the administration was “unlawfully [weaponizing] essential housing resources.”
“The court’s decision provides significant relief for communities in vulnerable circumstances and for the principle that federal housing funds exist to serve people in need, not to advance partisan goals,” Democracy Forward President & CEO Skye Perryman told the AP.
Officials Warn the New Policy Could Be Devastating
Even though this is not the first time Trump officials have tried to withhold federal funding for homeless services, the latest attempt seemed to catch some officials off guard. Some administration officials who spoke with Politico described the change as “the worst-case scenario” and “devastating.”
“We had no indication that there would be anything like this and no indication that the program would be administered this irresponsibly. We just did not see this coming,” one HUD employee told Politico.
Politico reported that the changes the Trump administration has requested would typically be communicated through HUD’s attorneys to ensure it complies with federal law. For instance, the McKinney-Vento Homeless Assistance Act requires local entities to use CoC funding for various programs, such as housing resources for individuals and families with disabilities.
Without these funds, experts worry that more people will end up homeless.
“When the subsidy and the support that goes along with those subsidies is removed, it puts people at grave risk,” a person with inside knowledge of the CoC program told Politico. “And most of these folks without these supports will likely end up back in emergency shelters or back on our nation’s streets.”
Oliva described the changes as a “betrayal of HUD’s mission.”
“This is an indefensible betrayal of HUD’s mission,” said Oliva. “Instead of helping communities end homelessness, HUD is actively fueling its growth with these decisions. As a former senior HUD staffer, I can honestly say that I don’t know what HUD is doing, and I don’t think they do either.”
Why We Must Act: Housing Is a Human Right
Now is not the time to be silent about homelessness in the United States or anywhere else. Unhoused people deserve safe and sanitary housing just as much as those who can afford rent or a mortgage.
Poverty and homelessness are both policy choices, not personal failures. That’s why we need you to contact your officials and tell them you support legislation that:
- Streamlines the development of affordable housing
- Reduces barriers for people experiencing homelessness to enter permanent housing
- Bolsters government response to homelessness
Together, we can end homelessness.