House Democrats Send Letter Urging HUD to Rescind Harmful CoC NOFO That Slashes Funding for Permanent Housing
Dec 08, 2025
By Sarita Kelkar, NLIHC Policy Intern
On November 25, 54 House Democrats—led by Ranking Member Maxine Waters of the House Financial Services Committee—sent a letter urging HUD Secretary Scott Turner to reverse the department’s recent Continuum of Care (CoC) funding decision that slashes over half of existing funds for permanent housing programs. Detailed in the CoC Notice of Funding Opportunity (NOFO) released November 13, cuts in the NOFO reverse a commitment to evidence-based programs proven to work—putting over 170,000 people at risk of returning to homelessness.
The CoC program partners with local organizations to connect people experiencing homelessness to housing and resources, historically offering an approach that is cognizant of community contexts. With an annual budget of around $3.5 billion each year, CoC funds are apportioned to five program components—supportive services, Homeless Management Information System (HMIS), homelessness prevention, transitional housing, and permanent housing—and serves as the largest source of federal funding for homelessness assistance. Permanent housing currently receives about 87% of CoC funds, with evidence showing that the “Housing First” model is the most effective approach to ending homelessness for most individuals and families. However, drastic and harmful changes outlined in the NOFO redirect CoC funds from permanent housing to programs that have higher barriers and adopt a less-effective “treatment first” approach.
The letter emphasizes how the NOFO:
Slashes funding for permanent supportive housing programs from 87% of CoC funds to just 30%, deprioritizing CoCs that use evidence-based solutions to end homelessness.
Worsens the situation for over 771,000 people experiencing homelessness, impacting people with disabilities, veterans, domestic violence survivors, women with children, and more.
Ignores the proven benefits of Housing First: a policy with a history of bipartisan support that remains the most effective tool local providers have to reduce homelessness, provides stable and affordable housing for people experiencing homelessness without preconditions, and ensures individuals have access to supportive services.
Creates a nearly half-year funding gap while only providing CoCs with 60 calendar days to apply for funding.
Ending with a call for HUD to rescind the NOFO, renew current grants, and ensure CoCs using evidence-based solutions continue to receive necessary funding, the letter provides a thorough overview of how critical existing CoC fund distribution is for addressing the ongoing homelessness crisis.
Read the letter here.
Read the Alliance’s full analysis of the NOFO here, and find more resources here.
NLIHC and the Alliance are calling on Congress to hold HUD accountable to its promised two-year NOFO cycle, and to include language in any final THUD bill that would extend funding for previously awarded projects for another 12 months.