Rhode Island – A federal court has struck down unlawful funding criteria imposed by the Trump-Vance administration that threatened to shift critical homelessness funding away from proven, evidence-based solutions. The court vacated the U.S. Department of Housing and Urban Development’s (HUD’s) 2025 Notice of Funding Opportunity (NOFO), rejecting the agency’s attempt to impose new conditions that could have pushed an estimated 170,000 Americans into homelessness.
The coalition behind the lawsuit, NAEH, et al. v. HUD, released the following joint statement in response to the ruling:
“This ruling is a welcome resolution that makes clear that the 2025 NOFO was unlawful and that the conditions the administration is putting on funding will cause harm to real people. We are grateful for this clarity, and remain committed to fighting the administration’s ongoing attempts to weaponize federal funding at the expense of people experiencing homelessness. Families, seniors, veterans, and people with disabilities depend on programs funded by these grants and we are proud to fight to protect proven solutions to homelessness and the hundreds of thousands of people who rely on this vital support.”
Additionally, members of the coalition also responded:
“The federal court’s decision to reject the Trump-Vance Administration’s attempt to disrupt essential housing services for people experiencing homelessness, including families, seniors, veterans, and people with disabilities, is both appropriate and just,” said National Low Income Housing Coalition President and CEO Renee M. Willis. “Over several months, HUD supported a NOFO that delayed noncompetitive renewals, issued grant agreements with discriminatory and anti-inclusionary provisions, and upended the stability of programs that are rooted in evidence-based solutions to homelessness. NLIHC celebrates this ruling and remains committed to working with our allies to safeguard the stability of critical programs that help hundreds of thousands avoid displacement and maintain stable housing.”.
“The court rightly recognized the harm to families and communities across the country,” said Toby Merrill, Public Rights Project’s litigation director. “Local governments rely on programs created by Congress to fight homelessness. HUD’s illegal attempts to redirect this critical funding would have affected the ability of people to access the housing and services they need to remain safe and stable.”
“We could not agree more with the court’s finding that abandoning Housing First was the ‘hallmark of unreasoned decision making,’” said Amy R. Romero, Chief Legal Counsel of Lawyers’ Committee for Rhode Island. “We are proud to represent Rhode Island nonprofits Crossroads and Youth Pride, along with nonprofits and local governments from across the country, to ensure that individuals and families experiencing homelessness have access to the housing they need.”
“On behalf of our members, the provider community and the unhoused people they serve each day, the National Alliance to End Homelessness is pleased with the court’s decision to vacate HUD’s harmful actions,” said Ann Oliva, CEO of the National Alliance to End Homelessness. “However, the Alliance remains deeply concerned with the Administration’s continued meddling in federal grantmaking, including similarly reckless changes in the FY 2026 CoC Program NOFO, and is reviewing all legal and advocacy options available to appropriately protect communities that would be harmed by these and future actions.”
“Central to this case were the lives of 170,000 people who would have been made homeless had the federal government’s drastic policy shifts taken hold and we are pleased the court ruled the government’s actions unlawful,” said Antonia Fasanelli, Executive Director of the National Homelessness Law Center. “Most of the people in this housing are elderly or have disabilities. Some are youth with no family support, veterans, and families with young children. Because the federal government has continued to impose rash changes that will lead to further homelessness, we remain steadfastly committed to protecting those households, the programs that serve them, and the rule of law.”
“We are grateful for the court’s ruling to ensure the government appropriately funds programs that support some of the most vulnerable people in our communities — without partisan or ideological conditions,” said Steven Brown, executive director of the ACLU Foundation of RI. “We will continue this work to support and defend Rhode Islanders, and people across the country.”
“We deeply appreciate our brave clients who fought back when the Trump-Vance administration yet again tried to weaponize the federal government against the American people it is meant to serve,” said Kristin Bateman, Senior Counsel at Democracy Forward. “We are honored to work with this broad coalition that is doing the important work of addressing homelessness, in spite of the insidious efforts by their president and his administration to undermine their programs.”
This victory closes one important chapter in the saga that has seen nonprofit organizations triumph repeatedly as they have challenged Trump-Vance administration efforts to unlawfully weaponize federal funding.
For years and through multiple presidential administrations, the Department of Housing and Urban Development’s (HUD) Continuum of Care (CoC) Program has helped provide the necessary resources for local governments and organizations to fund permanent housing projects for people experiencing homelessness. It has always been HUD’s obligation to release these resources in a timely manner through a lawful CoC Program competition NOFO. However, HUD attempted to radically upend this critical program with a FY 2025 NOFO that threatened to push an estimated 170,000 Americans into homelessness.
In response to the 2025 NOFO, the National Alliance to End Homelessness (NAEH), the National Low Income Housing Coalition (NLIHC), Crossroads Rhode Island, Youth Pride, Inc., as well as the County of Santa Clara, Calif., San Francisco, Calif., King County, Wash., Boston, Mass., Cambridge, Mass., Nashville, Tenn., and Tucson, Ariz took legal action challenging the grant restrictions. In December 2025, a federal judge granted preliminary relief in the case, and an appeals court refused to disturb the ruling in April. In February, Congress stepped in and required HUD to renew all existing grants for FY 2025. HUD still has not finalized those FY 2025 awards that by now are long overdue, leaving projects without funding and further disrupting the nation’s flagship homelessness response program.
On June 1, 2026, HUD released a FY2026 NOFO that would also unlawfully upend evidence-based, community approaches to homelessness, threatening the housing of more than 97,000 formerly homeless individuals. The plaintiffs sought to add a challenge to that NOFO to this case, but the court has invited plaintiffs to file a new case instead.
Democracy Forward and the ACLU Foundation of Rhode Island represent the coalition of nonprofit organizations in the matter; the National Homelessness Law Center represents NAEH and NLIHC; Public Rights Project represents the cities of Boston, Cambridge, Nashville, and Tucson as well as King County; Santa Clara County and San Francisco represent themselves. The Lawyers’ Committee for Rhode Island represents all plaintiffs.
Plaintiff and co-counsel quotes regarding the original filing are available here.
Read the court order here.
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Democracy Forward Foundation is a national legal organization that advances democracy and social progress through litigation, policy, public education, and regulatory engagement. For more information, please visit www.democracyforward.org.
