Planned federal housing grant cuts will spike homelessness, dozens of Minnesota organizations warn
Dozens of Minnesota nonprofits and advocates warn that planned federal housing grant changes could mean thousands of Minnesotans overcoming homelessness will return to the streets.
The U.S. Department of Housing and Urban Development announced plans to cap the amount of money communities can use for permanent supportive housing in the next round of grants for the Continuum of Care program, which is the largest source of funding for homelessness prevention.
Chris LaTondresse, president and CEO of Beacon Interfaith Housing Collaborative, called it the "backbone" of the nation's response to homelessness and said 82% of the $48 million Minnesota received last year focused on supportive housing. Under the proposed HUD changes, he said Minnesota could lose half of these dollars, leaving many people displaced.
"At a time when we need to be having conversations about how to put taxpayer dollars to their highest and best use, to walk away from the most proven and cost-effective solution we have on homelessness is just a real head scratcher," LaTondresse said.
LaTondresse, a former Hennepin County commissioner, said this approach helped the state's most populous county slash homelessness by 30% in five years. He also said it costs half as much as emergency room visits and shelters, which are the default for people who don't have supportive housing options.
An agency spokesperson on Thursday in response to WCCO questions said it is working with recipients of the funds to inform them of the changes and "prevent any unnecessary gaps in funding."
"HUD strongly refutes any claim or assertion that reforms will result in increased homelessness – our sole focus is to address the failures that we know have, in fact, resulted in increased homelessness thanks to failed so-called 'Housing First' policies," the spokesperson said via email. "We hope current permanent supportive housing providers will shift to transitional housing by providing robust wraparound support services for mental health and addiction to promote self-sufficiency. "
Beacon Interfaith Housing Collaborative joined 180 other advocacy groups and nonprofits in signing a letter to the Congressional delegation warning that the cuts to housing support could impact 3,600 Minnesotans and 170,000 Americans nationwide.
"We use Continuum of Care funding for critical rental subsidies and supportive services for 103 Minnesotans moving from homelessness to stability," Jessie Hendel, executive director for Alliance Housing in Minneapolis, said in a news release. "Without these funds, rents will become unaffordable, and formerly homeless individuals will be back on the street."
Hendel's organization manages 370 affordable housing units for people with very low incomes.
There is bipartisan concern about the changes to how the grants are awarded. GOP Congressman Pete Stauber of Minnesota's 8th District joined two dozen other House Republicans late last month in a letter to HUD Secretary Scott Turner, urging the agency to press pause on the changes for now.
"We recognize that HUD's efforts to modernize the CoC program and strengthen performance metrics are rooted in data-driven policymaking and a results-oriented approach. We fully support these goals," the letter said. "However, substantial changes to the [notice of funding opportunity] process or funding priorities should be implemented carefully to avoid destabilizing programs that serve individuals with severe disabilities related to mental illness, chronic health conditions, or substance use disorders, as well as seniors with disabilities."
Minnesota Democratic Sens. Amy Klobuchar and Tina Smith are also asking the Trump administration to halt the planned cuts.
More than 9,000 Minnesotans experienced homelessness during a single night count last year, according to a report submitted by HUD to Congress last December. And the state had the second-highest rate of unaccompanied youth experiencing homelessness at that time compared to elsewhere in the country.
This story was updated to reflect HUD's statement in response to a request for comment.