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No way to go home? Nonprofits steel themselves for proposed HUD changes

by | Dec 8, 2025 | ALLFFP, Government, Housing, Non-Profits, Region

Kathy Anderson worries about domestic violence victims trying to get back on their feet after experiencing a crisis.

And Meghann Cotter is concerned about disabled Fredericksburg-area residents trying to find a home after being on the street for a year or more.

Major changes to a program in which the U.S. Department of Housing and Urban Development funds homelessness programs has local nonprofits — and their leaders — bracing for cuts to services they provide for their most vulnerable clients.

The money is part of the Continuum of Care program, the largest single federal homelessness initiative, providing $3.9 billion in funding, according to a document prepared recently for the George Washington Regional Commission, a regional planning body.

In the past, 90% of funding allocated to a community was automatically renewed in the next funding cycle, Sam Shoukas, GWRC’s Housing and Community Health Program director, explained last month to members of the commission’s board.

But recently, the Trump administration announced that the next round of funding will cap automatic renewals at 30% of current levels, with communities having to compete for the remaining 70% of the money, Shoukas said.

This year’s community renewal amount for the Fredericksburg area is $636,198, so the guaranteed 30% amount would be $190,859. The remaining 70%, for which local officials would then have to compete, would be $445,339.

“We have to compete across the country for all of our projects,” Shoukas said.

The competition would, however, allow the Fredericksburg region to apply for more money than in previous years. So it’s possible that the area could gain as much as $294,271.

But the potential is there to lose the $445,339, as well.

For many years, HUD encouraged communities to shift dollars to permanent housing projects, such as supportive housing for the disabled — which Cotter’s Micah Ecumenical Ministries handles locally — and rapid rehousing, which Anderson’s Empowerhouse provides, Shoukas said.

Currently, 90% of the local Continuum of Care funding goes toward these permanent housing projects, a philosophy known as “Housing First,” she said. But now, the federal government plans to cap funding for these programs at 30 percent of current funding levels.

“Roughly 90 percent of the last four years’ CoC awards funneled funding to support the failed ‘Housing First’ ideology, which encourages dependence on endless government handouts while neglecting to address the root causes of homelessness, including illicit drugs and mental illness,” an announcement of the HUD changes said, noting that it aligns with President Trump’s executive order, “Ending Crime and Disorder on America’s Streets.”

Supportive housing

This national narrative claims that there are people getting public assistance who shouldn’t and that those individuals just need to go get jobs, Cotter, Micah’s executive servant-leader, said in an interview.

But that feeds a “horrible stereotype,” she said.

“I just don’t know another way to say it,” said Cotter, “when in fact, you’re talking about people that, in order to qualify, have to be diagnosed with a disability, and that disability has affected them in such a way that it has caused them to be on the street for a year or more.”

The rationale from HUD, she said, is the belief that people generally should be able to be independent and self-sufficient and not need government assistance.

“And that’s just not the story for vulnerable people with no social support system,” Cotter said.

Micah right now is funded for 30 supportive housing beds, she said, and the changes could take that figure down to as low as five.

“So all those people either have to be moved to another program, or we can no longer pay for them,” Cotter said.

How imminent are the changes? That depends on when grant agreements expire, she said. But the local application is due Dec. 14, she said, and the federal government hadn’t released the application as of Thursday.

Cotter also said there’s probably a way to appeal the funding decisions, but she’s not counting on that to be a successful strategy. She noted that an estimated 170,000 people across the country are at risk of losing their housing because of the HUD regulations.

Rapid rehousing

Empowerhouse, meanwhile, pays all or part of the rent for abuse victims until they can make it on their own, said Anderson, the nonprofit’s executive director.

“So you can imagine, you know, what it means when you’ve come out of domestic violence, and your life is completely disrupted and completely turned around, and most of the people we work with have children in that program,” she said.

Empowerhouse gets $142,372 in funding to cover eight beds, according to the GWRC document, and Anderson said her organization houses a total of 25 to 30 adults and 50 to 75 children.

The federal funding makes a difference for the people it helps, she said, and those who have received the help speak highly of the support they received.

“You know, you give people a certain amount of assistance, and then while they’re in their housing, they kind of sort things out, and then they’re not going to be homeless again,” Anderson said.

The sheer cost of living in the Fredericksburg area is also a barrier, she added.

“The rental units are very high here, and the housing inventory is not very high, and so the rental market, it keeps going up,” Anderson said.

She said the HUD grant helps those in Empowerhouse’s care who may need more than six months of assistance.

“So that hurts our heart to have programs that have been helping people and now be constrained to not offer those programs in the same way or not help people in the same way,” Anderson said.

Cotter put it another way:

“The problem is that the community is not going to realize what has happened until people start hitting the street again, and they have more homeless than they’ve ever imagined because beds have been taken away.”

Meghann Cotter is a member of the Free Press journalism advisory committee.

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