Trump Administration Proposes Shift to Treatment-First Homelessness Funding

The United States Department of Housing and Urban Development proposed a significant overhaul of federal homelessness funding in a September 11 notice posted in the Federal Register. The proposal seeks to shift grants away from the Housing First model, an Obama-era policy that provided permanent housing without requiring sobriety, toward treatment-first policies.

Under the new proposal, bonuses for the Continuum of Care program would incentivize addiction treatment, sober living, transitional housing, and increased cooperation with law enforcement. HUD argues that chronic homelessness has increased since 2013 and cites camping restrictions in cities such as San Francisco and Houston as evidence of a broader shift in policy needs. This move follows a 2024 Supreme Court of the United States ruling in City of Grants Pass v. Johnson, which granted local governments the authority to enforce public camping bans.

This proposal follows previous attempts by the administration to implement similar changes, which were blocked by federal courts in 2025 and 2026. Those legal challenges were brought by a coalition of 22 states, the District of Columbia, and housing advocacy groups, including the National Low Income Housing Coalition and the National Alliance to End Homelessness, who argue that Housing First remains a proven strategy.