The Trump administration’s Department of Housing and Urban Development is on the verge of making an already dire homelessness crisis even worse. It has been withholding billions of dollars in federal homelessness funding, in direct violation of statutory obligations and federal court orders.
Service providers across the country are running out of money, nonprofits are ending rent support for formerly homeless individuals, and thousands of people are at risk of being pushed back onto the streets. This is not just mismanagement; it is deliberate cruelty.
According to an article this week in Next City, for months, HUD has refused to send award letters for $3.6 billion in Continuum of Care homelessness support grants that were approved under the Biden administration. These grants fund everything from emergency shelters to permanent supportive housing for chronically homeless people with disabilities.
Many service providers operate on thin financial margins, borrowing money or drawing from reserves to cover costs while they wait for the government to reimburse them. Now, with no clear indication that HUD will release the funds, some organizations are running out of options.
One such program in Denver, run by the nonprofit Family Tree, has already announced that it will stop making rent payments for permanent supportive housing residents as of April 1.
According to Next City, thirty-four households, many of whom have disabilities, are facing eviction because of the federal government’s inaction. Among them is Sheila, a 54-year-old woman with multiple disabling conditions.
For the past year, she has lived in an apartment designed to accommodate her specific needs—an apartment that she was assured would be permanent. Now she is being told that she might have to leave.
Sheila’s story is a devastating reminder of how difficult it is to escape homelessness in the first place. She spent years living in her car before finally securing stable housing, only to now be faced with the threat of eviction because HUD refuses to issue funding it is legally required to provide. Her situation is not unique.
Across the country, thousands of people who fought to regain their stability are now being thrust back into uncertainty, all because the Trump administration has chosen to ignore the law.
This is not an isolated act of neglect. It is part of a larger assault on federal housing assistance. The administration has canceled technical assistance grants, eliminated fair housing grants, fired HUD employees en masse, and is reportedly considering closing dozens of HUD field offices. The cumulative effect of these cuts will be catastrophic, both for individuals experiencing homelessness and for the broader housing system.
For organizations that rely on HUD grants, the uncertainty is unbearable.
Next City talked to Steve Heisman, who runs HABcore, a permanent supportive housing provider in New Jersey, says that his organization is in serious financial jeopardy. Every year, HABcore takes out loans to cover costs while waiting for $3 million in HUD funding—money that represents half of the organization’s budget. But this year, without any communication from HUD, Heisman is unsure whether the funding will ever come through.
He is left to make agonizing decisions: should he take on more debt, mortgage a property, or start warning landlords and tenants that rent payments might not continue? If he can’t find a solution, the consequences will ripple beyond HABcore’s residents. Landlords will lose rental income, banks will see mortgage payments stop, courts will become overwhelmed with eviction cases, and entire communities will suffer.
The cruelty of this crisis extends beyond those currently experiencing homelessness. Foster youth, for example, are among the most vulnerable populations in the country, and they rely heavily on housing assistance as they transition into adulthood.
Another person Next City talked to, Corina Dechi, a former foster youth who now works at El Paso Human Services, is deeply concerned about what will happen if HUD continues withholding funding. Many of the young people she works with have no family support system, no financial safety net, and no ability to survive without government assistance. If the funding dries up, these young adults could end up on the streets before they ever have a chance to establish stability.
The same uncertainty hangs over El Paso Human Services itself.
Executive Director Susana Reza, who has run the nonprofit for 40 years, told Next City that she has never seen a situation like this. She is accustomed to shifts in funding priorities when different political parties take control of the government, but this level of instability is unprecedented. The nonprofit recently opened a women’s shelter, which reached full capacity in less than three months. Now, she is left wondering whether they will have to close their doors.
The Trump administration’s actions have already thrown the homelessness response system into chaos, but it is poised to do even more damage. If HUD follows through on plans to cut its workforce in half, it will become even more difficult for local governments and service providers to access federal resources. If it shutters field offices, communities will lose essential points of contact for assistance. If it continues delaying funding, service providers will go bankrupt, and people who rely on these programs will be left with nowhere to go.
The timing of this crisis is particularly cruel. Homelessness in the United States has reached record levels, fueled by skyrocketing rents, pandemic-era aid expirations, and economic instability. Cities and states are struggling to address the crisis, yet instead of strengthening federal support, the Trump administration is actively undermining it. Even those who have managed to secure stable housing are being thrown back into uncertainty.
It is important to recognize that this is not just bureaucratic dysfunction; it is a policy choice. The Trump administration is withholding legally obligated funding despite multiple court orders directing it to reverse its grant freeze. It is choosing to defy these orders, knowing full well that the consequences will be devastating.
This is not about fiscal responsibility or government efficiency—it is about cruelty. It is about punishing the most vulnerable people in society while using housing assistance as a political weapon.
The consequences of these decisions will not be confined to those experiencing homelessness. As people are forced out of housing, emergency shelters will be overwhelmed. Hospitals will see an increase in emergency room visits as people lose access to stable living conditions.
Law enforcement will be tasked with responding to more people living on the streets. Businesses will feel the impact as economic instability spreads. And taxpayers will ultimately bear the burden of a worsening homelessness crisis that could have been prevented.
The Trump administration’s approach to homelessness is a moral and economic disaster. If it continues down this path, the consequences will be devastating and long-lasting. But this crisis is not inevitable.
HUD could release the withheld funding today. Congress could intervene to force the administration’s hand. Local and state governments could step in with emergency assistance to keep people housed. The public could demand accountability and pressure their elected officials to act.
Every day that HUD delays funding, more people are pushed toward eviction. Every week that passes without action, more service providers are forced to consider shutting down. Every month that this crisis continues, more lives are destroyed.
If the Trump administration refuses to do the right thing, then it is up to the rest of us to make sure that it does not get away with it.
Truly a monstrous approach to running a federal government. There will be more people freezing on the streets, more children starving in our schools, more illnesses, more drug use, all because the wealthy want to be even more so. Absolutely disgusting.
“all because the wealthy want to be even more so”
Yeah, that’s it. The HUD secretary has paused grants while the dept reassesses funding. The FHIP has not been cancelled but all donees will have to reapply all so the rich can get richer. All saved HUD money will go directly to the rich. Do I have that about right? LOL
That comment stood out to me, as well.
I doubt that Trump (or Musk) at least are driven by a desire to become even wealthier. (Certainly, Musk has lost a lot of wealth on paper so far, as a result of his direct involvement.)
The interests behind the scenes are probably a different matter.
Musk has given up much trying to get our runaway debt under control. Instead of being scorned he should be treated like a hero. There are videos of both Obama and Biden saying they needed to do the same things that Trump and Musk are doing now regarding waste and needed programs.
“regarding waste and needed programs”
that should read “unneeded” programs.