Over 800 Atlanta households who rely on federal Continuum of Care grant funding to avoid sliding back into homelessness remain in limbo after the US Department of Housing and Urban Development (HUD) announced a sweeping overhaul of the grant renewal process in November. A slate of courtroom delays and unanswered questions from HUD has exacerbated confusion among local governments and nonprofits.
The federal Continuum of Care program distributes nearly $4 billion annually for homeless services. Many of the annual grants, which provide permanent supportive housing for unhoused people, will expire by the end of February, so HUD’s November announcement blindsided housing and service providers.
And nearly a month after a federal judge instructed HUD to continue renewing routine Continuum of Care grants while a legal challenge plays out, local housing and service providers still lack any clear guidance about how the new grant application process will work. They say the uncertainty and confusion makes it impossible to plan, seek out alternative funding, or reassure tenants they won’t lose their housing.
“This is just making what is already a really challenging job and ecosystem exponentially more difficult and confusing,” said Cathryn Vassell, the CEO of Atlanta-based nonprofit Partners for Home. “At this point, we’re just hoping for the best.”
Atlantans in limbo
Federal Continuum of Care funds subsidize rent and supportive services for 844 Atlanta households — who are now left to wonder if HUD will renew the grants in time. Locally, two significant grants will expire on Feb. 28. One $500,000 grant subsidizes rent and supportive services for 24 households at English Avenue’s Quest Community Village apartment complex, while another $800,000 grant does the same for 40 other households across town.
In November, HUD announced it would slash 70% of all permanent supportive housing funding and divert it toward short-term, transitional programs with strict work requirements and mandatory drug, alcohol, and mental health treatment. Housing advocates say the shift runs counter to decades of research supporting the Housing First model, which prioritizes stable housing before treatment or employment.
Atlanta homelessness service providers stand to lose nearly $10 million of the roughly $14 million they rely on annually to fund permanent supportive housing, due to HUD’s announced cuts. Initially, Vassell said, Partners for Home and other providers at least understood what HUD was demanding and scrambled to comply. They quickly drafted new grant applications and started exploring ways to convert permanent supportive housing into transitional programs mandating treatment.
But then HUD followed up with the sharply revised grant application process, blindsiding nonprofits nationwide who had come to expect routine grant renewals. Now, Vassell said, providers are caught between a temporary federal court order for HUD to continue the grant funding and HUD’s apparent determination to push ahead with the program overhaul.
A coalition of states sued HUD on Nov. 25, arguing that the agency violated federal law by attempting to impose the changes without proper authority. In December, a federal judge ordered HUD to pause the implementation of the new funding rules and proceed with grant renewals under the existing framework while the case continues.
But HUD asked the court for additional time to respond to the order, which has prolonged the uncertainty on the ground. The agency now has until Jan. 8 to explain to the court why it hasn’t resumed grant renewals.
‘Impossible’ contingency planning
“It is impossible at the moment,” Vassell said, to strategize without clear guidance from HUD or the court. “We’re really just in a holding pattern right now.”
One thing is certain: HUD aims to upend the way the United States houses people experiencing homelessness. “The department remains fully committed to making long overdue reforms to its homelessness assistance programs,” the agency told Atlanta Civic Circle in a Dec. 11 statement.
If HUD ultimately succeeds at cutting permanent supportive housing funding for unhoused people, local services providers would be forced to raise philanthropic dollars to offset the loss. But that’s tough to do without knowing how deep those cuts might be — or when they might come.
“We had started to do some planning around fundraising, figuring out what we might need from the private sector,” Vassell said. “We’re going to proceed with that, but funders are going to want answers first. It’s hard to go to a funder when there are still so many unknowns. They’re going to want some clarity around what they’re funding, and for how long, and what’s the sustainability plan.”
Atlanta City Councilmember Matt Westmoreland serves on the governing board for the local Continuum of Care program. He warned that the stakes for Atlantans served by the program are profound — and that there are limits to how much local governments and nonprofits can absorb the federal cuts.
“The harsh, plain truth is that, whether it’s Atlanta Housing or the city or state or philanthropic community, there is no way we can match what the federal government is spending on permanent supportive housing,” Westmoreland said. “It’s super dark, but we have navigated this storm as well as we could over the last year and will continue to do that in the future.”