A federal court ruled on June 30 that the Trump administration’s conditions on Continuum of Care homelessness funding are unlawful and cannot be implemented, according to the New York Attorney General’s office. The U.S. District Court for the District of Rhode Island partially granted a summary judgment motion filed by New York Attorney General Letitia James and a coalition of 18 other attorneys general and the governors of Kentucky and Pennsylvania, preserving more than $3 billion in federal housing funds.
Continuum of Care funds are what community organizations across the country receive to provide housing and services for people experiencing homelessness, including veterans, people with disabilities, and transgender individuals. In New York, 24 regional CoC organizations receive over $320 million, with 94 percent of those funds dedicated to permanent housing supporting 13,861 households statewide, according to the AG’s office.
The conditions the Department of Housing and Urban Development imposed in November 2025 would have capped how much CoC funding could go to permanent supportive housing, barred funding to any organization that acknowledges the existence of transgender or nonbinary individuals, and excluded programs providing services for mental disabilities. The proposed cap alone would have cut permanent supportive housing funding by two-thirds and put an estimated 170,000 people at risk of losing their homes, the AG’s office said.
James led the coalition in filing the lawsuit in November 2025, arguing that HUD’s conditions violate the Administrative Procedure Act and Congress’s constitutional power to control federal spending. The court agreed, ruling that the conditions HUD attached to its 2025 Notice of Funding Opportunity are unlawful.
“Once again, a court has ruled that this administration cannot put vital resources for our communities at risk just to advance their political agenda,” James said in the AG press release. “We will keep fighting this administration’s illegal attempts to undermine Continuum of Care funding and jeopardize supportive housing that our communities rely on.”
Joining James in the lawsuit are the attorneys general of Arizona, California, Colorado, Connecticut, Delaware, Illinois, Maine, Maryland, Massachusetts, Michigan, Minnesota, New Jersey, Oregon, Rhode Island, Vermont, Washington, Wisconsin, and the District of Columbia, as well as the governors of Kentucky and Pennsylvania.
Featured image: Courtesy bsky.app
