California attorney general challenges HUD’s policy shift that could displace 170,000 formerly homeless Americans.
California Atty. Gen. Rob Bonta filed a lawsuit Tuesday against the Trump Administration, aiming to block a dramatic shift in federal homelessness policy that he warns could force tens of thousands back into shelters—or onto the streets.
At the center of the legal battle is the federal Continuum of Care program, which provides funding to local governments and nonprofit organizations to combat homelessness. The Trump Administration recently announced a major policy change that would slash funding for rental subsidies supporting permanent housing and redirect those dollars toward transitional housing and services instead.
Bonta, joined by 19 other state attorneys general and two governors, argues that this move undermines proven strategies for addressing homelessness and violates federal law. Advocates say the policy change jeopardizes housing for an estimated 170,000 people nationwide. In Los Angeles County alone, local officials estimate that 5,000 households—totaling roughly 6,800 people—could lose their homes, wiping out recent progress in reducing homelessness.
“This [federal] program has proven to be effective at getting Americans off the streets, yet the Trump Administration is now attempting to illegally slash its funding,” Bonta said in a statement.
The Department of Housing and Urban Development (HUD) did not respond to a request for comment, but earlier this month defended the change, saying it would “restore accountability to homelessness programs and promote self-sufficiency among vulnerable Americans.” The agency said it believes transitional housing and supportive services are more effective than long-term subsidies for permanent housing.
The lawsuit claims HUD failed to follow proper procedures before implementing the changes, including legally required public notice. It also argues the new rules overstep executive authority by imposing restrictions not authorized by Congress.
In addition to capping the funding available for permanent housing, the new policy shifts more funding into competitive grants, complicating efforts for many local agencies to secure resources. Bonta’s office also alleges that the administration’s new guidelines cut off funding to applicants that recognize transgender and gender-diverse people, and penalize communities that don’t enforce policies favored by the administration—such as bans on public camping.
