By Vanguard Staff
OAKLAND – California Attorney General Rob Bonta and Governor Gavin Newsom have joined a coalition of states suing the Trump administration over sweeping new restrictions placed on federal homelessness grants, arguing the policy is unlawful and will push tens of thousands of people back into homelessness.
The lawsuit, filed in the U.S. District Court for the District of Rhode Island, challenges recently announced rules attached to the federal Continuum of Care homelessness program administered by the U.S. Department of Housing and Urban Development. The filing asks the court to halt the policy changes and declare them unlawful.
The coalition represents 19 attorneys general and two governors.
According to the lawsuit, the new requirements stem from President Trump’s executive order titled “Ending Crime and Disorder on America’s Streets.” Under the changes, HUD will significantly reduce funding for permanent supportive housing and require compliance with federal directives favoring expanded civil commitment, mandatory treatment participation, and stricter local enforcement of public camping laws.
“These abrupt changes are unlawful because they alter funding eligibility without authorization by Congress and are not supported by evidence or reason,” the complaint states.
The lawsuit argues the new rules violate the Administrative Procedure Act and multiple constitutional provisions, including the Spending Clause, separation of powers, and the Tenth Amendment.
Bonta said the directive represents a dramatic shift away from a longstanding federal Housing First strategy used by Democratic and Republican administrations.
“This program has proven to be effective at getting Americans off the streets, yet the Trump Administration is now attempting to illegally slash its funding,” said Bonta. “As a result, for the 47th time in 44 weeks, I’m taking President Trump to court. Those caring for our unhoused neighbors need the federal government’s continued support. Absent judicial intervention, the Trump Administration’s actions would only worsen the homelessness crisis.”
The filing states that the new terms would limit permanent housing spending to 30 percent of total funds beginning in 2026. According to the state, nearly 90 percent of California’s current funding allocation supports permanent housing.
The lawsuit also challenges new eligibility restrictions that deny funds to applications that acknowledge transgender or gender-diverse people.
The complaint argues that the new funding formula contradicts congressional intent, which requires HUD to prioritize permanent supportive housing and renew existing programs to protect vulnerable residents from eviction and homelessness.
Gov. Newsom criticized the administration’s move as punitive and politically motivated.
“While Donald Trump is busy hosting parties and showing off his gold-plated decor, Americans are worried about groceries, rent, and basic stability,” Newsom said. “Most families can’t fall back on inherited wealth or walk away from failure through bankruptcy — but they’re the ones stuck paying for his chaos and incompetence. For all Trump’s talk about others feeding at the trough, there’s really only one ‘piggy’ here — and he’ll find it in his own gilded mirror.”
California officials said the cuts would disrupt progress made through state investments, including Homekey, CalAIM, and the Behavioral Health Services Act. The administration noted more than $683 million in federal funds last year supported permanent housing in California.
If allowed to stand, officials warn the changes would jeopardize beds for older adults, veterans, youth, families, and people with disabilities, and destabilize established housing programs.
“Permanent and supportive housing is central to addressing homelessness and helping bring stability into people’s lives,” said California Business, Consumer Services and Housing Secretary Tomiquia Moss. “The federal government’s sudden and cruel changes to how nonprofits and community organizations can access funding threatens to undo years of progress and puts more than 170,000 people nationwide at risk.”
California Health and Human Services Secretary Kim Johnson said the policy shift could have severe consequences.
“The Trump Administration’s proposed cuts would worsen the homelessness crisis by pulling funding from permanent housing and putting tens of thousands of Californians at risk,” Johnson said. “This would undo years of progress and destabilize our neighbors who finally found a safe place to live, and stability. It’s harmful policy that will lead to devastating health outcomes.”
The state argues its current approach is working. According to the Governor’s office, California kept homelessness growth to three percent last year, compared to an 18 percent national increase, and achieved the nation’s largest reduction in veteran homelessness.
Bonta and Newsom were joined in the filing by Washington, New York, Rhode Island, Arizona, Colorado, Connecticut, Delaware, the District of Columbia, Illinois, and the governors of Kentucky and Pennsylvania, Maine, Maryland, Massachusetts, Michigan, Minnesota, New Jersey, Oregon, Vermont, and Wisconsin.
A hearing date has not yet been set.
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