HomeEverything
Equities & FundsCrypto & Digital AssetsAI & TechnologyBusiness & CorporateUS Politics & PolicyGeopolitics & Global RiskMacro, Rates & FXCommodities & EnergyEuropean Politics & MarketsAsia-PacificReal Estate & Property
← All Stories

Judge Blocks Trump Administration's Homelessness Funding Rule Changes

Created at 1 Jul · 7:45 PM1 source↑ Market-relevant
IN SHORT

A federal judge ruled against the Trump administration's changes to homelessness funding, stating the Department of Housing and Urban Development (HUD) violated federal law by not adequately considering the impact on providers and recipients. The ruling centered on the Continuum of Care program.

✉Newsletter

PiQ Daily

Pick your topics. Get only what matters, on your cadence.

Key Numbers

$3Bimpacted funding for homelessness programs
90% to 30%reduction in permanent housing funding
21states suing HUD

Who's Involved

Mary McElroy
U.S. District Judge ruling against HUD
Department of Housing and Urban Development
Federal agency whose funding rules were challenged
21 states and the District of Columbia
Plaintiffs in the lawsuit against HUD
Judge Blocks Trump Administration's Homelessness Funding Rule Changes

↳ Why This Matters

The ruling preserves critical funding streams for homeless service providers and upholds the Housing First model, which advocates argue is more effective in addressing homelessness than approaches requiring preconditions for housing.

Key facts

  • A federal judge ruled against the Trump administration's changes to homelessness funding rules.
  • The ruling found that the Department of Housing and Urban Development (HUD) violated federal law.
  • The judge stated HUD did not adequately consider the impact of the changes on providers and recipients.
  • The case centered on the Continuum of Care program, a primary source of funding for homeless services.
  • The changes would have significantly reduced funding for permanent housing and prioritized transitional housing with requirements.

A federal judge in Rhode Island has ruled against the Trump administration's attempts to alter funding rules for programs assisting the homeless. U.S. District Judge Mary McElroy stated that the Department of Housing and Urban Development (HUD) violated federal law by not adequately considering the impact of its changes on service providers and individuals seeking housing.

In her ruling, McElroy described HUD's actions as "the hallmark of unreasoned decision making" for hastily attempting to eliminate its "Housing First" approach. This strategy prioritizes housing homeless individuals before addressing other issues like addiction or unemployment. The lawsuit, brought by 21 states and the District of Columbia, challenged a sudden shift in how the Continuum of Care program, a key funding source for homelessness services, would be administered.

The proposed changes included a significant reduction in the proportion of funds that could be used for permanent housing, from 90% to 30%, and a redirection of funds towards temporary transitional housing. These programs often impose work or service requirements on residents. HUD had also proposed prioritizing cities that enforced public camping bans and withholding funds from programs that allegedly "facilitate racial preferences" or "violate the sex binary in humans."

While the ruling is a victory for the plaintiffs seeking to overturn these changes, Judge McElroy denied a request for a permanent injunction. This leaves open the possibility for HUD to attempt to implement similar changes at a later date.

Frequently asked questions

Housing First is a strategy that prioritizes providing permanent housing to homeless individuals as quickly as possible, and then offering supportive services as needed. The goal is to help people quickly exit homelessness and then address underlying issues like substance abuse or mental health challenges.

The Continuum of Care (CoC) program is HUD's primary funding stream for programs that address the immediate needs of people experiencing homelessness while promoting access to the community-wide solutions needed to prevent and end homelessness.

The proposed changes would have significantly reduced the amount of funding available for permanent housing solutions and shifted focus to temporary transitional housing, often with work or service requirements, potentially impacting the effectiveness and accessibility of services for those experiencing homelessness.

What Happens Next

01HUD may attempt to revise and reintroduce its funding rule changes.

Get the newsletter.

Pick the topics you actually care about. We'll email when there's news worth your time, on the cadence you choose. Cancel any time from your account.

Cadence

How It Developed

HUD outlined new guidelines for the Continuum of Care program, shifting funding priorities.
Cities and advocacy groups sued HUD over the new guidelines, citing a lack of warning and compliance time.
A federal judge ruled HUD's actions violated federal law by hastily eliminating its Housing First approach.
The judge denied a request for a permanent injunction, leaving room for future rule changes.

Sources

T1
Trump Administration Loses Lawsuit Over Homelessness Funding RulesBisnow

Related Stories

Judge blocks Trump administration's plan to limit student-loan forgiveness for public servants
30 Jun · 9:15 PM
Judge blocks USPS restrictions on mail-in voting
1 Jul · 8:05 PM
Anthropic Wins Court Reprieve on Pentagon AI Designation
1 Jul · 12:15 PM
US student loan plan ends, impacting millions of borrowers
1 Jul · 1:55 PM
Judge blocks Colorado's Enbrel price cap, citing federal law
1 Jul · 8:58 PM