Attorney General Raoul Secures Order Protecting Federal Support For Homelessness Services

A federal judge ruled HUD’s $1.3 billion set-aside limiting permanent housing funds was unlawful and cannot be implemented.

Submitted by Office of the Illinois Attorney General

Aug 11, 2026 9:10 AM

Listen to the story

CHICAGO – Attorney General Kwame Raoul, as part of a coalition of 20 attorneys general and two state governors, announced a win in their second lawsuit challenging the U.S. Department of Housing and Urban Development’s (HUD) illegal attempt to cap funding for permanent housing projects to address homelessness in states.

On Friday, a judge with the U.S. District Court for the District of Rhode Island granted critical parts of Raoul and the coalition’s motion for summary judgment, ruling that HUD’s set-aside was unlawful and cannot be implemented.

Get The Latest News!

Don't miss our top stories and need-to-know news everyday in your inbox.

“This order ensures states continue to have access to funding that is necessary to address homelessness,” Raoul said. “These resources were appropriated by Congress, and the attempt by the Trump administration to take away these funds is illegal and outside of HUD’s authority. I will continue to take action to protect federal funding for Illinois and stand with my colleagues in defense of the rule of law.”

Article continues after sponsor message

Reach Your Local Community with Us - advertise today!

For more than two decades, HUD has embraced a commitment to permanent housing programs and the Housing First model, which prioritizes getting unhoused individuals and families into permanent housing without pre-conditions, such as sobriety or a minimum income threshold. Housing First is proven to be effective at addressing homelessness and has been the cornerstone of state efforts since HUD and the Continuum of Care program first embraced the model over two decades ago. But the current federal administration has rejected HUD’s longstanding commitment to the Housing First model and undermined the Continuum of Care program.

HUD first published notices of funding opportunities last year that cut funding for permanent supportive housing by 70%. That funding opportunity was subsequently found to be unlawful in a separate lawsuit against HUD that Raoul and the coalition won on June 30 regarding the agency’s decision to impose illegal conditions on billions of dollars in funding for the Continuum of Care program. The program supports housing and other services for people experiencing housing instability or homelessness. On June 1, HUD issued a notice of funding opportunity that creates a $1.3 billion set-aside for new projects prioritizing such things as transitional housing, which has the effect of limiting available Continuum of Care funding for permanent housing. That new funding opportunity, which is the subject of the current lawsuit, threatened housing for at least 97,000 residents of Continuum of Care-funded permanent housing across the country and more than 5,000 residents in Illinois alone, according to the National Alliance to End Homelessness.

Joining Raoul in filing this lawsuit are the attorneys general of Arizona, California, Colorado, Connecticut, the District of Columbia, Delaware, Maine, Maryland, Massachusetts, Michigan, Minnesota, New Jersey, New Mexico, New York, Oregon, Rhode Island, Vermont, Virginia, Washington and Wisconsin, and the governors of Kentucky and Pennsylvania.

Prefer RiverBender on Google