HUD Policy Cuts & Legal Battles
Key Questions
What did the federal court rule on HUD's 2025 NOFO restrictions?
A federal court vacated HUD's unlawful restrictions on over $3 billion in CoC grants. The ruling protects roughly 170,000 people from forced exits from permanent housing programs.
What key changes appear in HUD's 2026 NOFO?
The 2026 NOFO removes the PSH cap but shifts $1.3 billion toward temporary programs and lowers Tier 1 renewal funding to 60%. NAEH has filed a new lawsuit challenging these provisions.
How might the 2026 NOFO affect specific states and localities?
Maine estimates 500 people could lose permanent housing, while Spokane warns of a potential 50% cut to its permanent housing grants. Maryland projects $33 million in cuts impacting 1,400 households and a 34% rise in homelessness.
What additional conditions are attached to the 2026 NOFO?
The notice includes immigration status requirements and anti-DEI provisions. Rhode Island homelessness groups have sued to block these new conditions.
What broader cuts does the Trump administration plan for HUD?
The administration has proposed a 13% reduction in HUD funding along with forced exits for 170,000 people and increased encampment enforcement. These steps would accelerate the shift away from permanent supportive housing.
Why are multiple lawsuits being filed against HUD policies?
Plaintiffs argue the funding conditions are unlawful and were implemented too rapidly without proper process. Courts have already struck down earlier versions of the restrictions in at least two states.
How does the 2026 NOFO differ from the vacated 2025 version?
While the 2025 restrictions were fully struck down, the 2026 version removes the PSH cap but still redirects substantial funds to temporary programs and lowers renewal guarantees. Advocates view this as a continued attempt to limit long-term housing support.
What is the current status of litigation over these funding changes?
The original 2025 restrictions have been vacated, but new suits targeting the 2026 NOFO are active in Rhode Island and elsewhere. The legal challenges focus on both procedural flaws and the substance of the policy shifts.
Federal court vacated HUD's unlawful 2025 NOFO restrictions on $3B+ CoC grants, protecting 170k from forced exits. HUD issued 2026 NOFO removing PSH cap but shifting $1.3B to temporary programs and dropping Tier 1 renewal to 60%. NAEH filed new lawsuit. Maine estimates 500 people could lose permanent housing. Trump admin plans 13% HUD cut, forced exits for 170k, encampment raids. Spokane warns of 50% cut to permanent housing under 2026 NOFO. Maryland Housing Secretary projects $33M cuts affecting 1,400 households, 34% homelessness spike. Rhode Island groups file new lawsuit against 2026 NOFO, adding immigration and anti-DEI conditions.