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A federal judge has temporarily blocked efforts by President Donald Trump’s administration to upend federal funding for permanent housing.
U.S. District Court Judge Mary S. McElroy on Friday granted a temporary injunction halting the upheaval of Continuum of Care grants, which have historically been used to fund permanent housing programs and are the federal government’s main response to homelessness. The U.S. Department of Housing and Urban Development (HUD) wants to cap permanent housing funds at 30% and shift the rest to temporary housing.
A Dec. 1 lawsuit filed by Santa Clara County and 10 other governments and nonprofits against HUD alleges this move is illegal — along with HUD’s new point system for rewarding Continuum of Care grants. The system was intended to rank projects that align with Trump’s agenda higher. Others that didn’t meet certain requirements were going to be denied funding.
HUD rescinded its funding guidelines an hour before the first hearing earlier this month.
Santa Clara County Counsel Tony LoPresti said the court’s injunction ensures local governments and homeless service providers can have continuity of funds to continue their work.
“The Trump administration’s callous, last-minute attempt to upend Continuum of Care funding threatens housing stability and access for hundreds of thousands of Americans,” LoPresti said in a statement. “We will continue to stand up to this brazen and unlawful attempt to take housing away from vulnerable seniors, children and families.”
Santa Clara County Supervisor Margaret Abe-Koga, who oversees District 5, said this motion helps to ease residents’ worries about losing their housing.
“The preliminary injunction was desperately needed because we cannot have people put out into the streets,” Abe-Koga told San José Spotlight. “We counties still operate on the knife’s edge. The judge aptly observed that these sudden changes from federal agencies keep coming — begging the question, ‘Is chaos the point?’”
A HUD spokesperson said in a statement to POLITICO that the department remains committed to program reforms “intended to assist our nation’s most vulnerable citizens and will continue to do so in accordance with the law.”
The lawsuit alleges HUD is criminalizing homelessness and dismantling the “housing first” model without congressional approval.
Trump issued an executive order in July calling for the end of “housing first,” which prioritizes permanent housing with no job or sobriety requirements. It operates on the idea that once someone has stable housing, they can make progress in other areas of their lives.
Studies have shown getting people into permanent housing decreased homelessness by 88%, and allows more people to remain housed than the “treatment first” model, which requires sobriety in order to obtain permanent housing.
Santa Clara County received nearly $48 million in Continuum of Care grants in January to provide rental subsidies and supportive services to vulnerable populations, such as homeless people and older adults. The grants also fund rapid rehousing programs, which provide time-limited rental subsidies. These programs serve approximately 2,500 county residents.
HUD’s proposed changes would have put more than 1,800 county households at risk of losing their homes.
More than 170,000 people are being housed and serviced by Continuum of Care grants nationwide, including older adults and people with disabilities.
“This order offers local governments and nonprofit organizations doing the hard and important work of supporting people experiencing homelessness some much-needed relief after the threat of harmful new conditions imposed by the Trump-Vance administration,” a statement from the plaintiffs in the lawsuit said. Those include San Francisco, the National Alliance to End Homelessness and the National Low Income Housing Coalition.
Santa Clara County has filed nine lawsuits against the Trump administration this year, including one blocking an executive order ending birthright citizenship. So far, the county has had favorable rulings in five cases granting relief.
This story was written by Joyce Chu for San José Spotlight. The original version of this article can be viewed here.
Contact Joyce Chu at joyce@sanjosespotlight.com or @joyce_speaks on X.
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