Trump Administration Freezes Funding for Los Angeles Homeless Services Authority, Putting Tens of Millions of Dollars for Homelessness Programs at Risk

By Alayna Calabro, NLIHC Senior Policy Analyst and Kim Johnson, NLIHC Senior Director of Policy 

HUD announced on June 11 that it was suspending the Los Angeles Homeless Services Authority (LAHSA) from participating in future federal funding opportunities, pending the results of an investigation of LAHSA under HUD’s Office of the Inspector General (OIG).  

In a letter to LAHSA, HUD accused the agency of fraud and blamed it for failing to reduce homelessness. The letter cites numerous reports and investigations finding LAHSA has mismanaged funds and failed to properly account for its spending. LAHSA says HUD’s action could jeopardize the work the authority is doing to reduce homelessness and result in thousands of formerly unhoused people reentering homelessness. Los Angeles Mayor Karen Bass noted that while she has concerns about LAHSA, threatening its funding does not help house people. She emphasized that the funding freeze would lead to dire consequences, and that “ultimately people will lose their lives.”  

Los Angeles leaders believe that the decision to halt funding entirely, rather than redirecting it to other agencies, is the latest politically motivated attack on California. HUD’s decision to suspend funding for LAHSA comes as the Trump administration has repeatedly weaponized fraud concerns to block federal funds that help people afford food, child care, health care, and other basic needs.  

While courts have so far ended or stalled many of the administration’s most drastic actions, on June 10, the House of Representatives passed legislation that would further enable the Trump administration to block federal assistance that helps people afford their basic needs. The “Stopping Fraudulent Payments Act” (H.R.8464) would create a new, broad, and subjective authority allowing federal agencies to block payments to individuals, nonprofit organizations, communities, and states “if they have ‘sufficient reason to determine’ the payment presents an ‘elevated’ risk of fraud,” according to an analysis of the bill by the Center on Budget and Policy Priorities (CBPP). As a result, the bill would allow the administration to target programs and states it disfavors, using unproven claims of fraud as a pretext to block or delay federal payments.  

Read HUD’s press release and letter. 

Read reporting from the New York Times and CalMatters.