National Alliance to End Homelessness v. HUD (2026)

The U.S. Department of Housing and Urban Development (HUD) has issued a 2026 grant notice that threatens to force 97,000 people back into homelessness. Public Rights Project filed a lawsuit on behalf of five local governments in partnership with Democracy Forward, Santa Clara County, and other partners. The complaint challenges grant requirements that would threaten funding for proven homelessness solutions. We’re asking the court to temporarily block HUD from moving forward and to grant relief to plaintiffs by August 10, 2026.

The case focuses on the Continuum of Care (CoC) grant program administered by HUD. Local governments use CoC funding to help people through permanent supportive housing, emergency shelter, street outreach, and services for people with disabilities and serious mental health needs.

HUD’s actions violate the Administrative Procedure Act and the Constitution. The 2026 notice recycles many of the same unlawful and unreasoned provisions the court already blocked in HUD’s 2025 grant notice. The agency is pressuring grantees to:

• Restrict housing to people who meet specific conditions, such as sobriety, employment, or participation in treatment. HUD falsely portrays any other approach as failing to hold people accountable, even though evidence shows that prioritizing safe housing leads to better outcomes.
• Eliminate harm reduction programs, despite proof that they reduce overdose risk and improve housing stability.
• Promote incorrect and biased stereotypes about who is “self-sufficient” and deserving of housing support, specifically discriminating against people with mental health disabilities, including substance use disorders.

The notice also requires grantees to comply with conditions unrelated to homelessness, including abandoning diversity, equity, and inclusion initiatives; rejecting transgender and nonbinary people’s identities; and helping enforce federal immigration law.

Without congressional authorization, HUD reallocated $1.3 billion intended for grant renewals to new projects in 2026. The notice heavily prioritizes strategies that are likely to exacerbate homelessness and ignores Congress’s directive to fund evidence-backed approaches. 

Since the early 2000s, HUD has used the evidence-based Housing First approach, which prioritizes placing people who are homeless into housing as soon as possible. Then, they are offered treatment for substance abuse or mental health and provided other support. Research shows this approach helps people stay housed and makes communities safer, while also reducing the strain on local government resources. 

If HUD is allowed to proceed, local governments and their community partners will be forced to reduce or even shut down programs, lay off staff, and eliminate stable housing for the people they serve. 

Read the lawsuit.