A Federal Court Says Trump Administration Changes Could Force Thousands Into Homelessness
A federal judge in Rhode Island temporarily blocked President Donald Trump’s administration from overhauling nearly $4 billion in homeless services funding on Friday.
U.S. District Judge Mary McElroy in Rhode Island issued an oral order granting a preliminary injunction against the administration’s last-minute changes to the Continuum of Care grant program, which is the largest source of federal funding for homeless services. McElroy agreed with advocates that the changes would result in thousands of people becoming homeless and could do significant harm to people who are homeless and service providers who help them.
“Continuity of housing and stability for vulnerable populations is clearly in the public interest,” McElroy said during the hearing.
Is ‘Chaos the Point?’
For nearly the entirety of Trump’s second administration, the Department of Housing and Urban Development has sought to undo a Biden-era notice of funding opportunity for homeless service providers. The NOFO prioritized funding permanent supportive housing, Housing First, and other programs with which the new administration disagrees. The new NOFO issued by the Trump administration sought to limit funding for permanent supportive housing at 30% of a grant award compared to the 90% levels allowed under Biden’s NOFO. It also sought to prioritize faith-based organizations, which the administration claims were discriminated against under Biden’s watch, and prohibit local partners from utilizing a Housing First service delivery method.
These changes were being made to comply with an executive order Trump issued earlier this year that directed federal agencies, as well as state and local governments, to treat homelessness like a mental health and criminal justice issue. However, McElroy ruled that the plaintiffs, a coalition of 20 states and 11 local governments, and nonprofits, were likely to succeed on the merits of the case because of HUD’s procedure for making the policy changes.
For instance, she pointed out that HUD’s changes conflict with requirements under the McKinney-Vento Homeless Assistance Act, which requires Congress to prioritize permanent housing. She added that HUD’s actions conflicted with statutory deadlines for issuing new NOFOs.
McElroy noted that the changes the Trump administration sought to make beg the question of whether they sought to impose chaos on the system.
“It’s concerning to the court that we sort of keep having these cases where the agency issues these orders or memos or changes of policy, but they haven’t done the work to get that policy through,” she said. “And so it sort of begs the question, are they really intending to change the policy, or is the chaos the point?”
Proposed Policy Could Have Displaced 170,000 People
Advocates estimated that the changes HUD sought to make would have caused about 170,000 people to lose their homes. This is happening at a time when local Point in Time Counts suggest that homelessness continued to grow in 2025. More than 771,000 people were counted across the U.S. during the last PIT count, an increase of 18% from the previous year, as the nation’s affordable housing crisis continues to worsen.
A large portion of those people would have been displaced from permanent supportive housing because they would not have received renewal funding for existing units. That means programs that currently house the formerly homeless would have seen their funding significantly reduced, thereby putting them at risk of closing for good.
One example of how devastating the changes can be is seen in a permanent supportive housing partnership between the LA Homeless Services Authority and the LA County Department of Health Services. The program serves about 344 people per year, according to its funding application, and receives millions in renewal funding each year. Overall, more than 93% of the CoC funds LA receives from HUD go toward renewal projects.
Projects like this are one reason why advocates have described the changes as a “life-or-death situation.”
“Thousands of Michigan families would have been forced onto the streets if the Trump Administration had been allowed to illegally upend support for those experiencing homelessness,” Michigan Attorney General Dana Nessel, one of the states that sued to prevent the proposed changes from taking effect, said in a statement. “I am relieved that the Court stepped in to prevent HUD from unlawfully attaching conditions to critical grant funding at the expense of vulnerable Americans.”
The proposed changes have also caused some of Trump’s supporters to speak out against the administration’s actions. For example, Rep. Mike Lawler (R-NY), one of Trump’s allies in Congress, said in a statement that the changes “put lives at risk.”
“We cannot allow policy changes to jeopardize the homes and security of families in our district,” Lawler said. “HUD must fulfill its obligations and ensure the necessary funding continues to flow to those who need it most.”
Housing Advocates Say the Fight Isn’t Over
Advocates have vowed to continue the fight until HUD restores all previously awarded funding under the CoC program. California Attorney General Rob Bonta said the proposed actions would have “worsened the homelessness crisis.”
“If the Trump Administration wants to stop losing in court, it should stop breaking the law,” he said. “When it comes to housing more of our unhoused neighbors and providing them the support they need, there is much progress we still need to make, and we need the federal government’s continued support — not actions that drag us backwards.”
How You Can Help
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.