Federal upheaval to the decades-old Continuum of Care grant program is jeopardizing $14.5 million in federal funding that provides permanent supportive housing to 844 formerly homeless Atlanta households.
In mid-November, the US Department of Housing and Urban Development (HUD) abruptly overhauled the requirements for $3.9 billion in Continuum of Care grants to prioritize the Trump administration’s favored treatment-first approach. The agency said it was redirecting 70% of the funding from permanent supportive housing to short-term programs with strict work requirements and mandatory drug, alcohol, and mental health treatment.
That upends federal funding for the widely embraced Housing First model, which prioritizes getting people stably housed, then addressing other issues like drug use and mental illness. In November, HUD said only 30% of Continuum of Care grant renewals would support currently funded permanent supportive housing programs.
Then on Monday, HUD pulled the Continuum of Care grant application entirely, in the face of criticism from national housing groups and a federal lawsuit filed by 18 states plus the District of Columbia. HUD said in a website notice that it is retooling the grant requirements and will reissue the revised Continuum of Care grant application well before the current Jan. 14 deadline — deepening confusion among housing providers already scrambling to understand the changes.
“We’re really confused about what to do and how to pivot,” said Cathryn Vassell, who heads Atlanta’s top homeless services nonprofit, Partners for Home. “This continues to put a very big question mark around the folks [currently housed] in these supportive housing programs.”
HUD usually approves Partners for Home’s annual $14.5 million in Continuum of Care grant requests without a hitch. Most of that money funds permanent supportive housing programs. But as of Monday, Vassell was flying blind, struggling to draft the grant applications without any federal direction about the shift to treatment-first programs.
“We’ve received zero guidance from HUD,” Vassell added. HUD did not respond to Atlanta Civic Circle’s request for comment.
One Continuum of Care grant that expires Feb. 28 provides almost $500,000 for 24 units with supportive services at English Avenue’s Quest Village apartment complex. Another, worth nearly $800,000, subsidizes rent and supportive services for 40 other households across the city.
The deadline to apply for renewals to both grants was supposed to be Jan. 14. But since HUD withdrew the Continuum of Care grant application on Dec. 8, Vassell said, “I’m not even sure when the deadline is.”
If HUD doesn’t renew the two grants, then 64 households could be thrust back onto the streets on March 1, or at least forced to navigate Atlanta’s increasingly expensive and competitive housing markets.
“Profound desperation”
The federal upheaval has provoked anxiety for Atlanta housing nonprofits and their clients, many of whom rely on Continuum of Care funding to stay housed.
Donell Woodson, who runs the city’s Housing Help Center, told Atlanta Civic Circle that he’s been fielding frantic phone calls from both housing providers and their clients — conversations “marked by profound desperation,” he said.
Some housing recipients have called in tears, asking, “Does this mean the money is gone forever?” or “What do I do about the eviction notice I have next week?”
Uncertainty over the Continuum of Care funding has “introduced a significant layer of confusion and emotional difficulty for the very people we are here to serve,” Woodson said.
“Our job is not just to connect people to a specific program; it is to offer stability and clear navigation,” Woodson added in an email. “When the funding mechanism changes daily, it forces our housing navigators to spend critical time not delivering services but explaining programmatic shifts that are entirely outside of residents’ control.”
Housing nonprofits regroup
Some local housing nonprofits are hedging their bets, crafting Continuum of Care grant requests that comply with HUD’s new treatment-first requirements to house unsheltered people, while hoping HUD rethinks that approach.
“I’m cautiously optimistic, but moving forward as if eventually HUD is going to reissue [a similar notice],” said Scott Walker, the CEO of 3Keys, an Atlanta housing nonprofit that manages nearly 500 permanent supportive housing units citywide.
“We were going to do some submissions for transitional housing, just to be safe,” he said. That would require 3Keys to convert its housing portfolio into short-term transitional housing and establish treatment programs. “We didn’t want to get caught up and not have any funding and then have to put people out.”
Still, Walker winces at the idea of replacing long-term housing with more punitive options that make housing contingent on having a job and participating in treatment programs. Decades of research show that people are far more likely to get sober, mentally healthy, and self-sufficient if they’re housed first, he emphasized.
Natallie Keiser, the head of local advocacy group HouseATL, said HUD’s looming pivot away from Housing First policies has her “very anxious.”
“It’s very regressive,” she said in a text, “to ignore what works and return to what research shows is ineffective — and to do it so dramatically, with no time for a transition plan.”
Vassell, of Partners for Home, is holding out hope that HUD’s seeming about-face signals that “they recognize the err of their ways” — and that upending Housing First programs will only exacerbate the nation’s growing homelessness crisis.
But as housing providers await the new Continuum of Care grant requirements, she added, “We don’t expect their ideological goals to change very much.”
UPDATE: After this story published, Atlanta Civic Circle received the following comment from HUD: “HUD fully stands by the fundamental reforms to the FY25 Continuum of Care Notice of Funding Opportunity (NOFO) and will reissue the NOFO as quickly as possible with technical corrections. The Department intends to make resources available in a timely manner so grantees with measurable results can continue to support vulnerable populations. The Department remains fully committed to making long overdue reforms to its homelessness assistance programs.”
I know it’s difficult to deal with so many fluctuations in policy but I commend those working diligently to solve the housing crisis. You are tremendous! Thank you for looking out for a very vulnerable people