Attorney General Peter F. Neronha has joined with 18 other attorneys general and two governors to file a lawsuit in the federal District of Rhode Island against the U.S. Department of Housing and Urban Development (HUD). The coalition alleges that HUD’s recent changes to its Continuum of Care grant program will reduce support for Americans experiencing homelessness by limiting access to long-term housing and services.
The lawsuit claims that HUD is reducing the amount of grant funds available for permanent housing and project renewals, while adding new requirements. These include recognizing only two genders, requiring residents to accept services before obtaining housing, and penalizing providers in areas without strict anti-homeless laws. According to the complaint, these changes are inconsistent with previous HUD guidance and congressional intent.
“This Administration continues to punch down by targeting the most vulnerable Americans, and unfortunately this most recent attack on homeless individuals is consistent with their modus operandi,” said Attorney General Neronha. “The President and his Administration don’t care about making life easier or better for Americans; they only care about political capitulation, consolidating power, and further enriching the wealthy. If allowed, these cuts and conditions would further exacerbate already dire conditions for homeless Rhode Islanders. We will succeed here, as we have nearly every time in the last 10 months, because we are right on the law. And we will continue to fight for all Americans, especially those who can’t fight for themselves.”
Historically, any changes made to grant conditions were incremental so as not to disrupt providers’ ability to plan or budget. The current overhaul could lead to administrative difficulties and potentially cause thousands of people to lose their housing.
For years, HUD’s Continuum of Care grants have supported local coalitions working on homelessness by providing predictable funding streams. Providers often combine these grants with other resources in order to maintain stability in their programs.
HUD has previously promoted a “Housing First” approach—offering stable housing without preconditions such as sobriety or minimum income—which research has shown improves outcomes for both individuals experiencing homelessness and communities at large.
Rhode Island depends heavily on Continuum of Care funding for its homelessness programs. Administered through RIHousing, this grant supports permanent housing annually for at least 273 people across 216 households in Rhode Island. Most of Rhode Island’s $17.3 million annual allocation goes toward permanent housing projects; however, under HUD’s new rule capping such spending at 30%, significant reductions are expected statewide.
Previously about 90% of Continuum of Care funds went toward permanent housing projects nationwide; under the new policy set for grants starting in 2026, this would be cut by two-thirds. Similarly, renewal guarantees would drop from around 90% year-to-year protection down to just 30%. Advocates warn that these reductions could result in mass evictions among formerly homeless individuals living in permanent supportive housing.
Additional policy shifts include withholding funds from applicants who acknowledge trans or gender-diverse people or prioritize services for those with mental health or substance use disorders. Localities taking different approaches toward homelessness may also face discrimination under these rules.
The complaint argues that HUD failed to follow required procedures—including engaging in rulemaking—and imposed unauthorized restrictions contrary to congressional statutes and its own regulations. Plaintiffs contend that HUD’s actions are arbitrary because it did not explain why it abandoned longstanding policies nor consider the impact on vulnerable populations facing eviction.
Leading the complaint alongside Attorney General Neronha are Washington Attorney General Nick Brown and New York Attorney General Letitia James; attorneys general from Arizona, California, Colorado, Connecticut, Delaware, District of Columbia, Illinois, Massachusetts, Maryland, Maine, Michigan, Minnesota, New Jersey, Oregon, Vermont and Wisconsin have joined as well as governors from Kentucky and Pennsylvania.
