Homeless service providers in Southern Oregon and Northern California are waiting to see what happens next after the federal government reversed course on a policy shift on funding homeless services.
The Department of Housing and Urban Development announced in November that it would prioritize funding for short-term transitional housing and supportive services, such as substance use treatment, rather than permanent housing for homeless people.
That led to two lawsuits: one from a coalition of states, including Oregon and California and one from local governments and nonprofits. HUD withdrew those changes Monday, shortly before a scheduled court hearing on the lawsuits, Politico reports.
"Things are changing by the day," said Darlene Spoor, executive director of Arcata House Partnership. "Just wait a minute, and the president’ll give us something new to worry about."
The original Notice of Funding Opportunity (NOFO) allocated $3.9 billion in grants for HUD's Continuum of Care program, which provides funding to address homelessness. The press release says, among other changes, it "restores accountability to homelessness programs and promotes self-sufficiency among vulnerable Americans."
“Our philosophy for addressing the homelessness crisis will now define success not by dollars spent or housing units filled, but by how many people achieve long-term self-sufficiency and recovery,” HUD Secretary Scott Turner said in the release.
HUD has traditionally encouraged the "Housing First" model, which prioritizes placing people experiencing homelessness in permanent housing. The new NOFO would have decreased the percentage of Continuum of Care funding allocated to permanent housing from about 90% to about 30%.
Local service providers agree on the importance of substance use treatment and transitional housing, but they want more time to prepare if there are drastic changes. They also want to keep funding for permanent housing, which keeps folks sheltered long-term.
"Helping people reach permanent housing is the ultimate goal," said Kristen Schreder, the coordinator for the Northern California Continuum of Care. "The program that they were advocating for, this latest NOFO, would have upended the goal, the accomplishments."
Heyleigh Strempel, UCAN's director of housing and community services, agrees.
"Permanent supportive housing is meant really to sustain households that cannot be housed otherwise. Those are the hardest people to house with the highest barriers. So a reduction in permanent supportive housing across the nation would have big impacts," she said. "However, there is a big need for more transitional housing and detox and substance use recovery centers. [...] So I don't know that cutting one and funding another or vice versa is going to maybe solve the problem."
The Monday announcement said HUD would revise and reissue the NOFO.
But the agency did not provide a timeline, so Schreder doesn't know when they’ll receive funding or how much.
"We just have no idea," she said. "It's not a really good way to plan what should be a multi-year planning function to allocate funding on a multi-year basis. It's better if we know a little more in advance."
Schreder said time is running out. The approval process takes months, and some HUD grants end in July, leaving agencies at risk of running out of funds.
Meanwhile, a HUD report released one year ago says homelessness increased nationally by 18% between 2023 and 2024 to the highest number ever recorded.
Spoor is concerned about what will happen to the families Arcata House Partnership shelters if HUD slashes funding for permanent housing.
"If they don't have this support, they will become homeless again," she said. "What we're hearing from people we serve [is] they will die without support and without housing. They have no options."
