A new Trump administration directive could drastically increase Atlanta’s unsheltered population next year, putting nearly 600 formerly homeless households back on the street.
The White House plans to slash funding for permanent supportive housing programs by two-thirds in early 2026. Instead, the US Department of Housing and Urban Development’s (HUD) Continuum of Care grant funding — for rehousing people experiencing homelessness — will be diverted to short-term programs that impose work requirements, mandate drug and mental health treatment, and accelerate homeless encampment sweeps.
It is another sign that the current administration is rejecting HUD’s widely accepted, evidence-based “Housing First” strategy, wherein unhoused people are first stabilized in supportive housing before tackling addiction or mental illness. Instead, the White House favors a more punitive, demonstrably less effective treatment-first approach to confronting homelessness.
HUD laid out the new priorities in a Nov. 13 call for grant applications, capping allocations for permanent supportive housing at just 30% of the $3.9 billion it distributes across the Continuum of Care program for cities, counties, and states to rehouse homeless people. All beneficiaries are disabled, and many are 50 or older.
The cuts are expected to displace up to 170,000 formerly homeless people nationwide from federally subsidized housing, including an estimated 588 households in Atlanta, according to the city’s go-to homeless services coordinator, Partners for Home. Currently, 844 Atlanta households rely on the HUD grants for housing and wraparound services.
Atlanta’s most recent HUD-mandated Point-in-Time count last January found 1,061 people living unsheltered. Local housing advocates say HUD’s funding restrictions will expand tent cities, increase panhandling, and further strain local jails and hospitals, which already serve as short-term shelter for people experiencing mental health and substance use crises.
“This is pretty much all bad,” Partners for Home CEO Cathryn Vassell said of the new Trump administration directive. As head of Atlanta’s Continuum of Care network, Partners for Home this year helped local nonprofits direct the $14.5 million they received from the feds to housing initiatives, most of which went to permanent housing programs. But those organizations stand to miss out on over $9 million of the $13 million they rely on to permanently house people and provide wraparound services, when the cut takes effect in early 2026.
Currently, federally funded permanent supportive housing offers — but does not mandate — wraparound services for people who need medical, mental health, or drug use treatment. “What HUD is saying is that we can only allocate 30% of our annual renewal demand [for federal grant funding] to permanent housing,” Vassell said.
Instead, the White House is directing municipalities to send homeless people to short-term transitional housing facilities, where substance use and mental health treatment is mandatory. However, in Atlanta, like other major metros, that infrastructure simply doesn’t exist at a scale that can absorb the blow, local advocates say.
“There is no rehab facility to bring you to, because it’s not been funded,” Vassell said. “These [HUD] dollars don’t pay for rehab or treatment, and we hardly have any treatment facilities in Atlanta.” So, “it’s going to be jail, I guess,” she said, for many formerly homeless Atlantans now housed through HUD’s Continuum of Care grants.
The Trump administration’s impending cuts to the Continuum of Care program follow a July executive order demanding that local governments prioritize jailing or institutionalizing unhoused people with substance-use or mental-health disorders. That order, called “Ending Crime and Disorder on America’s Streets,” portrays unhoused people as dangerous threats to society. “Endemic vagrancy, disorderly behavior, sudden confrontations, and violent attacks have made our cities unsafe,” it says.
A more expensive approach to combating homelessness
It costs about $25,000 a year to permanently house someone and provide supportive services, such as jobs training, mental health and substance use treatment, and connection to medical services, Vassell said.
By contrast, it can cost anywhere from $4,000 to $60,000 per month — depending on the severity of a person’s condition — to involuntarily institutionalize someone in a live-in mental health facility, according to Kim Jones, the executive director of the National Alliance on Mental Illness’s Georgia chapter. That adds up to a minimum of $48,000 per year per person.
To lock up one person at the Atlanta City Detention Center (ACDC) can cost taxpayers $78 per day — or $28,470 a year. It costs about the same to lock someone up at the Fulton County Jail, according to estimates from local criminal defense attorneys. Fulton County did not fulfill Atlanta Civic Circle’s open records request for this story.
The White House directive also instructs Continuum of Care grant recipients to add at least two law enforcement representatives to their governing boards, underscoring the administration’s insistence that police play a role in the homelessness response.
During a HUD Zoom call Friday, Trump advisor Robert Marbut, who is staunchly anti-Housing First, addressed concerns from current Continuum of Care grant recipients that police are “not good at deescalation” with unhoused communities.
“If you believe that,” Marbut said, “that’s why they need to be at the table.”
Local housing efforts at risk
To preserve long-term supportive housing programs for unhoused people, providers who lose federal funding will have to compete for limited philanthropic dollars and local government funding.
Scott Walker, the CEO of local housing nonprofit 3Keys, said his group is scrambling to plan for the fallout. “Part of the contingency plan is to do everything in our power to locate some alternative money to fill these gaps,” he told Atlanta Civic Circle. “But there’s only so much money to go around.”
Disrupting the way organizations like 3Keys run, he added, runs counter to the Trump administration’s stated goal of reducing homelessness.
“Philosophically, this goes against everything 3Keys stands for,” Walker said. “I’m not trying to put people who are homeless in jail. I’m not trying to lock them up in an institution, and I’m not trying to make the housing that’s been affordable for them no longer affordable.”
Tying housing to mandatory treatment would destroy trust-building efforts with people who’ve been living outside for years, Walker warned. Engagement often demands patience.
It could take an unhoused person five attempts to say, “Hey, I surrender. I want to go into treatment,” Walker explained. “So if you say it has to happen on the front end, and it’s contingent upon you getting the opportunity to be housed, we’re on a slippery slope.”