Federal Grants for Permanent Supportive Housing Thrown into Chaos

Confusion, concern and uncertainty continue to swirl around federal funds earmarked for housing the homeless across the nation, including here in Central Oregon. An hour before a court hearing for a lawsuit filed by multiple states, including Oregon, challenging new rules governing federal grant money for the homeless, the U.S. Department of Housing and Urban Development withdrew its controversial plan.

Here’s the backstory. On Nov. 13, HUD suddenly announced new requirements for grants for the Continuum of Care Program that would’ve tied funding to mandatory requirements. It significantly altered the longstanding Housing First model that provides stable housing without preconditions to a more transitional housing program with a list of new requirements like universal mandatory alcohol treatment.

The CoC grants were established in 1987. HUD distributes billions of dollars each year to state, local and non-profit entities. The Homeless Leadership Coalition is the CoC distributor locally.

“In Central Oregon, we receive about $830,000 a year and that’s all, currently, all dollars that house folks who used to be homeless,” HLC Chair Eliza Wilson told the Source. “About 90% of our programs are those permanent supportive housing folks. So folks who are disabled and are in housing.” Permanent supportive housing subsidizes units for people, many on Social Security, who cannot support themselves.

“You rely on the rent to be able to keep them housed and be able to provide them services. It’s really unheard of that the federal government stopped grants that they know people are in housing, that we renew those rents every year,” Wilson says.

The new HUD policy would have only allowed 30% of CoC funds be used for permanent housing and suddenly end its practice of guaranteeing 90% of the funding to existing CoC organizations like HLC, which has relied on that money for decades. In response, 20 states and Washington, DC, sued HUD saying the changes would throw the program into chaos and throw tens of thousands of people back into homelessness.

While HUD has rescinded the order, it has not yet reissued its Notice of Funding Opportunity with instructions for the grant application, even though the deadline to apply is January 14. Because of the uncertainty, the HLC board has paused the local competition for those funds. Wilson anticipates, at this late date, if the January deadline isn’t extended, another lawsuit may be filed.

Wilson says 93% of the HLC’s budget funds permanent supportive housing supported by HUD grants which have been renewed for decades. Only about 10% of the nonprofit’s funds are something HLC competes for.

In the past two years, the HLC has helped house an additional 340 people in Central Oregon. Wilson says most are supported for one or two years, before becoming independent, but some have relied on housing aid for the past eight years.

“If these folks don’t get housed, then what will happen if they aren’t able to remain in housing are our homeless numbers will continue to go up, significantly” she says.

For now, Wilson is waiting for word on when and how to apply for the CoC.

“We feel, based on what we’ve heard from some advisors and different folks involved, either that it will come out before Christmas, and they won’t extend the deadline which is something that is worrying folks.” Worrying, because she says it’s an impossible timeline.

The application process is lengthy involving public notification, a competition for local agencies seeking the funds and an independent review team ranking the projects, which the HLC board would then have to approve.

“I think folks are scrambling everywhere. On what this means. What it could mean.”