The U.S. District Court for the District of Rhode Island on June 29, 2026, ruled that the U.S. Department of Housing and Urban Development (HUD) wrongfully imposed new funding criteria for fiscal year (FY) 2025 homeless assistance awards that threatened housing for people served by programs like permanent supportive housing that follow a “housing first” model. The model initially addresses the housing needs of someone experiencing homelessness and subsequently adds on services and supports as appropriate.

In a case watched by grantees of HUD’s Continuum of Care (CoC) homeless assistance program, including some LeadingAge members, the National Alliance to End Homelessness and others argued that HUD’s abrupt change in eligible uses of CoC funding away from the housing first model would risk the housing of 170,000 currently assisted people.

The ruling only applies to HUD’s use of FY25 funds, but HUD has signaled similar constraints will be applied for the fiscal year 2026 funding provided by Congress. In a statement, the Alliance said it “remains deeply concerned with the Administration’s continued meddling in federal grantmaking, including similarly reckless changes in the FY 2026 CoC Program [Notice of Funding Opportunity], and is reviewing all legal and advocacy options available to appropriately protect communities that would be harmed by these and future actions.”

LeadingAge has been tracking this issue; we are pleased with the ruling and share the Alliance’s concerns about the stability of future funding.