HUD Reveals Its Intentions for Homeless Services, and We Need to Be Prepared
By John Lemke
In November of last year, HUD released a Notice of Funding Opportunity (NOFO) to homeless services agencies across the country. It included drastic and detrimental changes to how HUD wants to use federal money to address the problem of homelessness. The changes were immediately challenged by lawsuits from 20 states and did not fare well. However, per the recent funding bills just passed on Feb. 3, HUD is expected to issue another NOFO by June 1, giving the agency another chance at drastically reshaping federally funded homeless services. In preparation for that, we need to know what to watch out for, and the November NOFO, even though it’s been rescinded, gives us a number of important policies targeted by HUD that we need to protect.
I want to highlight three especially destructive and cruel changes proposed in the November 2025 NOFO:
1) “Housing first” has been the best practice for addressing homelessness for decades. Get people into housing and then work with them to address any other needs they have. On July 24, the President ordered HUD to stop following this successful practice, thinking instead that a homeless person is homeless because of their own problems and failures. The November NOFO drastically reduced the funding that can go to permanent housing and rapid rehousing programs like those offered by The Road Home, Porchlight, the YWCA, the Salvation Army, Housing Initiatives, Urban Triage, and Tellurian. Roughly two-thirds of the money previously spent on permanent supportive housing and rapid rehousing programs must go instead to transitional housing and supportive services, including street outreach.
2) HUD indicates that agencies’ requests for funds can be denied if they now or in the past used “racial preferences,” used harm-reduction measures like safe injection sites, or defined gender in ways other than strictly binary. We know that many trans youth, especially those who’ve recently aged out of foster care, have limited housing choices and often end up in the homeless-services system. Preventing agencies from focusing on their particular needs is cruel and damages the entire community.
3) The NOFO also requires that agencies providing services to homeless people must verify their immigration status and cooperate with law enforcement. We already know that people who need other sorts of services will not pursue them for fear of ICE (Immigration and Customs Enforcement), so if this requirement goes into effect, we can anticipate that many homeless families who could otherwise be helped by services already working in their community will be afraid to use them.
When HUD publishes a new NOFO in the next few months and we see policy changes like these, what can we do to push back?
We need to take advice from Torrie Kopp Mueller, the continuum of care coordinator for Madison and Dane County since 2017. She deeply understands the NOFO process and is a great resource.
We should also speak to our leaders in state government. There is state money that could be directed to compensate for losses we’re most likely going to suffer. Perhaps homeless services could be something we talk to legislators about when Madison Action Day 2027 comes around.