Late last week, the Trump administration released revised scoring criteria for homelessness organizations seeking grant funding from the Department of Housing and Urban Development’s Continuum of Care program.
The move signals a new direction in federal homelessness policy. For more than a decade, HUD had supported “Housing First,” an approach that calls for permanent rental subsidies without behavioral expectations. Now, the agency will favor transitional work- and sobriety-oriented homelessness programs, in keeping with the administration’s July executive order.
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This is a big change, as critics have noted, though they miss the mark on many of the details. First, funds are being shifted, not “cut.” The Continuum of Care program will next year deliver more homelessness funding—$3.9 billion—than the previous high set under the Biden administration. And to the extent that more funds flow to transitional housing, which serves more people than permanent housing, more people will receive services.
The new policy will serve a wider variety of people, too. Transitional housing serves the “middle class” homeless: nondisabled individuals with a shot at a working-class existence. Because of Housing First’s influence, America now has only 85,000 units of transitional housing, down from around 200,000 15 years ago.
Homeless-services systems should reflect the homeless population’s needs in their full complexity. Housing First proponents’ favorite argument—that “overwhelming and conclusive evidence” supports their approach—sidesteps the question of need. Not everyone needs a Housing First-style permanent supportive housing unit. An evaluation of a program for disabled people is obviously irrelevant to the question of which program best serves homeless people capable of economic independence.
In general, homelessness offers a cautionary tale about the use and abuse of “evidence-based” rhetoric. For years, whenever anyone raised reservations about how increased spending didn’t seem to reduce public disorder, about a new program’s potential to destabilize neighborhoods, or about the possibility of tradeoffs in homelessness policymaking, advocates offered a consistent response: never mind those cavils, social science backs us.
At the beginning of the 2010s, America had about 240,000 permanent supportive housing units. Today, we have 400,000. Yet, during that span, not only did chronic homelessness rise—the specific problem that Housing First-style policies are supposed to fix—it rose faster (58 percent) than overall homelessness (21 percent). The least that one can say on behalf of the Trump administration’s new policy is that it will be founded on more honest premises than the old one.
The new criteria will rebalance the homeless-services system. Transitional housing should not be described as “services first,” but rather as a different way to integrate housing and services. This kind of housing belongs in any “continuum of care” worth the name. Yet last year, only 1 percent of Continuum of Care funding went to transitional housing, down from 26 percent 15 years ago.
Increasing investment in transitional housing will improve homeless services’ reputation. It will lead to more success stories of substantive economic mobility.
Fundraising galas for homelessness programs often feature “happily ever after” profiles of formerly homeless people who recount their experience getting permanent housing. What happened after that, though? We never learn. Overdose rates in supportive housing programs can be astronomical.
Under the new policy, only 30 percent of federal Continuum of Care funds will go toward permanent housing, down from 90 percent this year. But states and localities that want to maintain more robust funding levels for Housing First–style permanent supportive housing can do so with their own money.
Deep-blue jurisdictions devote billions of state and local resources to such programs. Examples include New York’s “large scale” Empire State Supportive Housing Initiative and “very large scale” New York City 15/15 programs; Los Angeles’s Proposition HHH program; and California’s No Place Like Home and Proposition 1 initiatives. States and localities can also target mainstream housing resources to programs for the formerly homeless, as distinct from the low-income population more broadly.
Anyone who criticizes the Trump changes for being too extreme must reckon with the other side’s resistance to even the smallest modifications to Housing First. One recent example was Governor Gavin Newsom’s veto last month of AB 255, which would have given California communities the local option to spend 10 percent of homelessness funding for recovery-oriented housing. Another example came in 2019, when advocates, bureaucrats, and Congress countermanded HUD’s efforts to modify the Continuum of Care criteria toward the end of Trump’s first term. In their own words, critics were outraged that HUD would “allow applicants [for grant funding] to earn full points, even if the applicant stated they would impose service participation requirements on a client after that client accessed housing.”
This time around, shortly before the recent government shutdown, HUD career staff leaked details of the new criteria to the media, perhaps hoping to use the shutdown fight to pressure the administration to abandon the changes. It didn’t work, but they succeeded in illustrating the bureaucracy’s desire to resist change.
Housing First proponents have for years maintained an inflexibility poorly suited to American democracy. The welfare state needs give in its joints. If the entire government budget must remain on autopilot because any change to social programs would simply be too disruptive, what’s the point of debating social policy—or even of voting?
By statute, Congress directed HUD to award Continuum of Care dollars “on a competitive basis.” But according to the Trump administration, not much competition was occurring, with the vast majority of funding simply renewing the previous year’s allocation. Under the new criteria, 70 percent of funding will be subject to competition.
To be clear, there is a powerful, need-based argument for permanent supportive housing, which should remain part of the homeless services system. In the post-Housing First era we’re entering, permanent supportive housing should be rethought, not dismantled wholesale.
Many questions remain. To preserve funding access, will some permanent housing programs just rebrand themselves as transitional housing? What about those individuals who need a “higher level of care,” such as people with serious and persistent mental illness? Some in that cohort should be the responsibility of mental-health systems, not homeless services. Ideally, systemic change in homeless services will be coupled with systemic change in mental-health services.
Photo by Jeremy Hogan/Getty Images