AG Brown sues over HUD policy that would put more people into homelessness

The U.S. Department of Housing and Urban Development (HUD) is illegally upending supports for tens of thousands of Americans experiencing housing insecurity or homelessness with abrupt changes that will limit access to long-term housing and other services, according to a lawsuit filed today by a coalition of states co-led by Washington Attorney General Nick Brown.

HUD is drastically changing its Continuum of Care grant program in violation of congressional intent by dramatically reducing the amount of grant funds that can be spent on permanent housing and project renewals and putting new unlawful conditions on access to the funding. These requirements include that providers only recognize two genders, mandate residents accept services as a precondition to obtain housing, and punish providers in localities that do not enforce strict anti-homeless laws, all barriers that are in contrast to HUD’s previous guidance and Congress’ approval.

Previous changes to the grant conditions have been incremental to not disrupt providers’ ability to provide housing and to budget for their programs well in advance. These wholesale changes will create administrative chaos and likely result in thousands losing housing.

“Congress designed this program in recognition that homelessness is a crisis that requires immediate stabilization and continuing support to reverse,” Brown said. “These changes are designed to trap people in poverty and then punish them for being poor.”

“Ripping away this critical funding is yet another cruel attack by the Trump administration on our most vulnerable Washingtonians,” Governor Bob Ferguson said. “This $120 million in annual funding supports data-driven programs that are proven to help stabilize people so they can have the best chance to secure permanent housing. Trump is once more playing politics with people’s most basic needs. I appreciate Attorney General Brown and his team fighting this illegal action.”   

“People's homes are not political experiments. The Trump administration's actions undermine federal law, jeopardize the safety and stability of Washington residents, and will increase homelessness,” said Rep. Nicole Macri (D-Seattle). “I am proud to stand with Attorney General Nick Brown to stop this unlawful and deeply harmful federal policy shift – one that puts thousands of Washingtonians at risk of losing their homes."

For decades, HUD has helped local and regional coalitions plan and coordinate housing and services for people experiencing homelessness through Continuum of Care grants, which were created by Congress. Providers pair these grants with other funding sources and rely on the predictability and continuity of the grants to support the unhoused.

HUD has a longstanding policy of encouraging what is known as a “Housing First” model that provides stable housing to individuals without preconditions like sobriety or a minimum personal income. These policies are proven to improve housing stability and public health while reducing the costs of homelessness to individuals and their communities.

Washington impact

About $120 million in these grants comes to Washington annually, with most of it going to the five counties with the greatest need for housing services – King, Pierce, Snohomish, Spokane, and Clark counties. The remaining $25 million is distributed by the state to Washington’s other 34 counties, which are largely rural.

The housing support has made a difference for many people across Washington, including one client in Bellingham who found housing and case management services through Opportunity Council, a nonprofit connecting people in Whatcom, Island, and San Juan counties with services including housing.

“When you become unhoused, survival takes over. Routines, organization, even your sense of who you are, gets pushed aside. People don’t realize how quickly safety and stability disappear, or how long it takes to rebuild them even after you get housed again,” the person wrote. “I left a domestic violence situation and spent five years in instability: shelters, cars, couches, motels, a tiny trailer. My son spent his early childhood in that reality while I tried to navigate his disabilities and a maze of systems that made us constantly prove we deserved help. Getting housing was a huge relief, but functioning didn’t come back overnight. It took more than a year before I could manage daily routines or feel safe again. That’s why wraparound services matter — they are the bridge between ‘not dying’ and actually living.”

In Yakima County, the funding has also helped people find stability and a place to call home.

“Permanent supportive housing is not only compassionate, evidence-based, and socially accountable, it is the most efficient and fiscally responsible use of taxpayer dollars. When people are housed, communities spend less on already overburdened crisis systems,” said Jennifer Schlenske, executive director of Justice Housing Yakima. “Every dollar invested in permanent supportive housing saves multiple dollars down the line.”

“Yakima Neighborhood Health Services has provided permanent supportive housing for 20 years, using evidence-based practices of Housing First and harm reduction strategies to help chronically homeless and disabled residents improve their health and self-sufficiency in the Yakima Valley,” said Rhonda Hauff, president and CEO of Yakima Neighborhood Health Services. “It has taken two decades to build a system that keeps this vulnerable population off the streets. HUD’s change in priorities destabilizes our entire housing system – just like a game of Jenga – leading to increased homelessness, strains on the health system, and higher taxpayer costs. Yakima County will see more people living unsheltered and greater pressure on law enforcement and social services. This is a huge step backward for our community.”

Previously, HUD has directed approximately 90% of Continuum of Care funding to support permanent housing, but the agency’s new rule – which Congress never authorized – would cut that by two-thirds for grants starting in 2026. Similarly, HUD has long allowed grantees to protect around 90% of funding year to year – essentially guaranteeing renewal of projects to ensure that individuals and families living in those projects maintain stable housing. But HUD has slashed this figure, too, to only 30%. These new policies virtually guarantee that tens of thousands of formerly homeless people in permanent housing nationwide will eventually be evicted through no fault of their own when the funds aren’t renewed.

Additionally, HUD is planning to withhold funds to applicants that acknowledge the existence of trans and gender-diverse people, de-prioritize services to people with mental health issues or substance-use disorder, and discriminating against localities whose approach to homelessness differs from the administration’s.

Legal complaint

The complaint alleges HUD violated its own regulations by not engaging in rulemaking before issuing the changes and violated the law by not receiving congressional authorization for these new conditions, many of which are directly contrary to congressionally passed statutes and HUD’s own regulations. The plaintiffs also argue that HUD’s actions are arbitrary and capricious several times over, as HUD has made no effort whatsoever to explain the abandonment of their own longstanding policies or consider the obvious consequences of tens of thousands of vulnerable people being suddenly evicted. The agency explicitly encouraged grantees to implement Housing First policies and to focus on the particular needs of LGBTQ+ individuals as recently as last year.

The complaint, led by Brown, New York Attorney General Letitia James, and Rhode Island Attorney General Peter Neronha, was filed this morning in the federal District of Rhode Island. The coalition also includes the attorneys general of Arizona, California, Colorado, Connecticut, Delaware, the District of Columbia, Illinois, Massachusetts, Maryland, Maine, Michigan, Minnesota, New Jersey, Oregon, Vermont, Wisconsin, and the governors of Kentucky and Pennsylvania.

A copy of the complaint is available here.

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