Federal Judge Blocks HUD Plan Endangering 1,600 Beds in Minnesota

UPDATE: A federal judge has just halted a controversial HUD initiative that threatened to jeopardize 1,600 beds for the homeless in Northeastern Minnesota. In a decisive ruling on December 23, 2023, U.S. District Judge Mary McElroy ordered the U.S. Department of Housing and Urban Development (HUD) to revert to its previous grant distribution method for 2024, maintaining crucial funding levels for permanent supportive housing.

The ruling came in response to a plan that would have redirected funds away from long-term housing, an action that advocates warned could have led to an increase in homelessness. Under the proposed changes, only 30% of the $3.9 billion program budget would have been allocated to permanent housing, a significant drop from the current 90%. Housing advocates expressed alarm, with internal HUD documents suggesting that 170,000 people nationwide could have faced homelessness.

Co-directors of the Northeastern Minnesota Continuum of Care, Cara Oakland and Patty Beech-Dziuk, welcomed the judge’s injunction. “There’s still a lot of uncertainty,” said Beech-Dziuk. “The judge’s ruling was a really great step.” However, the emotional toll is evident, as organizations that provide essential housing services had already begun preparing for the new regulations.

One organization has even announced it would cease applying for funding, notifying residents that their rent assistance will end by the end of the month. “The organizations are still in a place where they have to decide if they can trust they will be awarded,” Oakland explained. With HUD funding not expected until May, the pressure on these organizations is mounting.

The Northeastern Minnesota Continuum of Care received over $600,000 in 2024, supporting 284 beds, with approximately 74% allocated for permanent housing. Meanwhile, St. Louis County’s Continuum of Care received more than $3.8 million, supporting 1,820 year-round beds, approximately 77% of which were permanent.

In a statement following the ruling, a HUD spokesperson affirmed the department’s commitment to providing homelessness assistance nationwide. “The Department remains committed to program reforms intended to assist our nation’s most vulnerable citizens and will continue to do so in accordance with court orders.”

Minnesota Attorney General Keith Ellison, who is one of the plaintiffs in the case, celebrated the judge’s decision, emphasizing the potential loss of housing for tens of thousands. “We were able to temporarily halt the Trump administration’s unlawful actions and protect unhoused people from losing their housing and having their lives destroyed,” Ellison stated.

As the situation develops, the focus remains on how organizations will navigate the funding landscape and whether they can sustain their programs amidst ongoing uncertainties. The community is urged to stay informed and engaged as these critical decisions unfold.