What do HUD Funding Changes for Housing Programs Mean Locally?
The National Alliance to End Homelessness estimates that 170,000 Americans could lose supportive housing as a result of the changes announced last month.
By Adele Uphaus
MANAGING EDITOR AND CORRESPONDENT
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Changes to how the U.S. Department of Housing and Urban Development (HUD) plans to fund regional Continuums of Care next year could result in a loss of permanent housing for clients of Empowerhouse—the local nonprofit supporting survivors of domestic violence—and of Micah Ministries.
HUD late last month released a “notice of funding opportunity” to CoCs—which are federally-mandated planning bodies that coordinate services for homeless individuals and families—introducing a number of significant changes that have caused uncertainty among homeless services providers.
The change most significant to the Fredericksburg Regional CoC is a cap on funding for permanent supportive housing projects. No more than 30% of annual funding can be allocated towards these projects, according to information currently available.
In a press release from HUD, Secretary Scott Turner said that “In accordance with President Trump’s Executive Order, ‘Ending Crime and Disorder on America’s Streets,’ this [notice of funding opportunity] restores accountability to homelessness programs and promotes self-sufficiency among vulnerable Americans. It redirects the majority of funding to transitional housing and supportive services, ending the status quo that perpetuated homelessness through a self-sustaining slush fund.”
Nationwide, according to a dashboard prepared by the National Alliance to End Homelessness, CoCs dedicate 88% of their funding to housing. The Fredericksburg Regional CoC—which provides services to Caroline, King George, Stafford, and Spotsylvania counties and the City of Fredericksburg—dedicates 84% of its funding to housing programs.
Empowerhouse’s rapid-rehousing program for survivors of domestic violence received $142,372 and served eight people during the current funding cycle, according to information provided by the regional CoC to the board of the George Washington Regional Commission, which oversees the CoC’s work.
The grant is up in June of 2026, “so anyone in their project is looking at moving to another rapid rehousing source that is not federally-funded, or getting off of the subsidy before the end of June,” said Samantha Shoukas, housing and community health program coordinator for the GWRC.
Micah Ministries currently serves 30 people through its permanent supportive housing program. Shoukas said the current grant agreement expires at the end of this month. She said funding through December 2026 has been awarded, but that no grant agreement has been received yet.
Another change implemented by HUD is that CoC funding will no longer be automatically renewed at 90% of the prior year’s funding. Now, funding will be renewed at 30% of the prior year’s funding. The remaining 70% is competitive and awarded based on the CoC’s performance and on how its projects rank according to new priorities.
“Some of those priorities have changed,” Shoukas said. “So now they will be looking at whether CoCs have more collaboration with law enforcement, and especially around supportive services—not just whether you have them, but whether your CoC has formal partnerships.”
Supportive services include substance use and mental health treatment, life skills, and employment training, Shoukas said. These are offered as part of permanent supportive housing programs, but participation has not previously been a requirement of these programs, she said.
“There is encouragement of service participation—even some of the projects are required to provide 40 hours per week of service participation,” Shoukas said. “So there’s the requirement to meet that threshold of hours” in order to stay in housing.
The Fredericksburg Regional CoC received $636,189 in funding from HUD for the most recent fiscal. Automatic renewal at 30% is $190,859, leaving the remaining $445,339 competitive.
Shoukas said the increased competition means the regional CoC can apply for an additional $294,721 on top of that.
“So, yes, there is option for more money if we perform well, but the redistribution [away from permanent supportive housing] means a loss of housing beds for our community,” she said.
She said the smaller size of the Fredericksburg Regional CoC compared to other organizations means that any outcome not perceived as positive can have an outsized impact on overall performance.
“That can be challenging,” Shoukas said, but she added that historically, the Fredericksburg Regional CoC has scored higher on average than other groups.
Applications for HUD funding under the new notice are due January 14, though Shoukas said applications have not been released yet.
“Our biggest thing here is trying to make sure we can submit an application that is competitive and asks for all the money we can ask for,” she said. “Because once we lose it, it’s hard to get it back.”
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