Dive Brief:
- Eleven local governments and nonprofit organizations filed suit against the U.S. Department of Housing and Urban Development on Monday alleging the agency illegally canceled grants for programs designed to combat homelessness.
- In November, HUD rescinded previously approved Continuum of Care grants and slashed dedicated permanent housing funding by two thirds. The move could impact housing for as many as 170,000 people, according to the complaint. Recipients of grants from the fund will be required to meet the Trump administration’s new criteria concerning gender, immigration and diversity, stipulations the plaintiffs called “unlawful.”
- HUD’s policy shifts “will destabilize communities across the country,” stated Renee Willis, president and CEO of the National Low Income Housing Coalition, one of the plaintiffs. “The harm to families and individuals who rely on these programs will be irreversible and felt for generations to come.”
Dive Insight:
Shortly after the federal government reopened following the shutdown, HUD announced its CoC grants would shift funding away from permanent housing and instead prioritize short-term housing programs.
Permanent housing advocates sounded the alarm about the move, arguing tens of thousands of CoC beneficiaries could be displaced.
HUD rescinded its two-year notice of funding opportunity for the grants Nov. 13, “mere weeks” before fiscal 2025 awards were expected to be disbursed, according to the complaint. The agency then replaced the NOFO — which was part of an approved two-year funding cycle — with its new one, “initiating a new competition” for awards, according to the complaint…