The Department of Housing and Urban Development (HUD) on November 13, 2025 issued a drastic policy change to an annual funding opportunity for the Continuums of Care (CoCs) program, which coordinates homelessness services and and related initiatives programming on a regional basis. Older adults age 55 and over are the fastest-growing demographic of homeless people in America. The agency’s move marks a significant shift in federal homelessness priorities and puts older adults at risk.

The agency’s fiscal year 2026 Notice of Funding Opportunity (NOFO) for homelessness programs moves millions of dollars away from Permanent Supportive Housing (PSH) units, which support families and older adults experiencing homelessness through permanent, affordable, service-enriched housing options, to transitional housing and other temporary services that are designed to enable a transition to the workforce and can include work training requirements.

PSH, a type of Housing First model, is widely accepted as an effective approach for addressing homelessness. HUD’s action reflects the Trump administration’s targeted change to federal priorities, outlined in an Executive Order issued in July, away from the Housing First model.

Going into 2026, nearly 90% of HUD’s CoC funding was expected to be used for PSH units connected to services needed for housing stability. The new funding requirements instead limit the amount of CoC funds that can be used for PSH to 30%. This funding change will impact renewing PSH programs, jeopardizing housing for about 170,000 people currently in a PSH unit, according to analyses by Politico.

According to the latest HUD data available, nearly 40% of PSH residents in 2023 were older adults.

In addition, LeadingAge members who serve low-income older adults and rely on PSH funding, including as a part of new developments through the Low Income Housing Tax Credit (LIHTC) as required by certain states, will be directly impacted by the major policy change.

The NOFO new funding approach is long-delayed, resulting in existing project grants expiring before the new award funding is granted. According to the National Alliance to End Homelessness, approximately one-third of all current program awards are expected to run out of funds before the new awards can be made.

The NOFO also makes other policy changes that will disrupt current homelessness interventions, including requiring awardees to adhere to President Trump’s Executive Orders related to LGBTQIA+ and immigration policies.

This fall, groups of both Democratic and Republican lawmakers have appealed to HUD to correct course: In November, 42 members of the Senate Democratic caucus sent a letter to HUD urging the agency to reconsider the new approach to homelessness funding, saying the limit on PSH funding will “upend” communities relying on homelessness programs. In October, more than 20 Republican lawmakers also sent a letter to HUD asking for a renew of the existing grants to avoid the disruption and destabilization resulting from substantive policy changes enacted this late in the funding award process.

LeadingAge opposes the move by HUD to abandon proven homelessness supports and push older adults back into homelessness.