This case challenges the U.S. Department of Housing and Urban Development’s (HUD) sudden and unlawful decision to completely overhaul the federal government’s primary homelessness program, placing hundreds of thousands of people at risk of losing stable housing.
For decades, Congress has directed HUD’s Continuum of Care program to prioritize permanent housing and provide stable, predictable funding so communities can prevent and reduce homelessness. In 2024, Congress authorized a two-year funding cycle to improve efficiency and stability. HUD initially followed that directive.
In November 2025, HUD abruptly reversed course. The agency rescinded the congressionally authorized two-year Notice of Opportunity (NOFO) and replaced it with a new process that slashes funding for permanent housing by two-thirds, delays critical grants for months, and imposes unlawful ideological conditions on applicants. As a result, local governments and nonprofit providers face immediate funding gaps that threaten housing for more than 170,000 people, including seniors, people with disabilities, veterans, families with children, and LGBTQ+ youth.
The coalition filed suit on December 1, 2025, asking the U.S. District Court for the District of Rhode Island to block HUD’s unlawful rescission of the two-year funding framework and its replacement with the new NOFO. Plaintiffs sought emergency relief to prepare for funds to go out and to stop the administration from shifting resources away from proven, evidence-based solutions to homelessness.
In December 2025, the court granted a preliminary injunction blocking HUD’s rescission of the two-year NOFO and its replacement with the new NOFO, and ordering the agency to prepare to grant renewals under the original, congressionally authorized funding framework, should the court ultimately order that relief. That order remains in effect while the case proceeds toward a final decision on the merits on an expedited basis.
The plaintiffs include national housing organizations, service providers, and local governments across the country that rely on Continuum of Care funding to keep people housed. They are asking the court to block HUD’s unlawful actions, restore the congressionally authorized funding framework, and prevent disruptions that would force people back into homelessness.
Democracy Forward represents the plaintiffs in this case.
Timeline
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HUD rescinds the congressionally authorized two-year Notice of Funding Opportunity (NOFO) for homelessness assistance and replaces it with a new NOFO that slashes permanent housing funding and delays awards.
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Coalition files suit in the U.S. District Court for the District of Rhode Island, challenging HUD’s rescission of the two-year NOFO and its replacement with a new, unlawful NOFO.
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With minimal explanation, HUD withdrew the NOFO issued in November and stated that a new NOFO was planned, without indicating when it would be published.
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The U.S. District Court for the District of Rhode Island grants a preliminary injunction blocking HUD’s rescission of the two-year NOFO and its replacement with the new NOFO.
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Later that evening, HUD issued another NOFO that also slashes permanent housing funding and delays awards.
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Coalition filed its First Amended Complaint and moved for summary judgment.
