7,000 Michigan Families at Risk of Losing Housing Assistance Due to Federal Cuts

Michigan Attorney General Dana Nessel has raised alarms over impending federal policy changes that could strip housing assistance from approximately 7,000 families across the state.

Among those affected are about 2,000 families with children, highlighting the widespread impact of these cuts.

The policy shift pertains to the federal Continuum of Care (CoC) program, a vital initiative designed to support nonprofits and local governments in their efforts to combat homelessness.

Administered by the U.S. Department of Housing and Urban Development (HUD), the CoC program has been a cornerstone in providing stable housing solutions.

However, recent changes announced by HUD have prompted Nessel, alongside a coalition of 20 other states, to file a lawsuit challenging the legality of these modifications.

The lawsuit contends that the alterations will severely limit access to long-term housing and impose unlawful conditions on grant recipients.

Sarah Rennie, Senior Director of Advocacy for the Michigan Coalition Against Homelessness (MCAH), expressed deep concern over the potential ramifications.

She emphasized that in MCAH's 35 years of operation, they have never encountered a threat as severe as this to individuals living in poverty.

Rennie warned that lives could be lost as a result of these policy changes.

The crux of the issue lies in HUD's decision to reallocate funding within the CoC program.

Historically, approximately 87% of CoC funds have been dedicated to permanent housing programs.

The new policy proposes reducing this allocation to just 30%, with a significant portion of funds being redirected toward transitional housing assistance programs that include work or service requirements.

This shift could place around 170,000 people nationwide at risk of homelessness, many of whom have disabilities or complex health needs.

In Michigan, the potential impact is particularly stark.

Last year, the state received over $100 million through the CoC grant program.

The proposed funding cuts and policy changes threaten to destabilize this support system, potentially leading to increased homelessness and associated social challenges.

Rennie highlighted that Michigan is already grappling with an affordable housing crisis, with an estimated shortage of over 290,000 affordable housing units.

She noted that real wages have remained stagnant while inflation continues to rise, pushing many hardworking families to the brink of financial disaster.

The proposed federal changes, she argued, misunderstand the root causes of homelessness and could exacerbate the existing housing crisis into a full-blown catastrophe.

In response to these developments, Nessel's lawsuit asserts that HUD's actions violate its own regulations by not engaging in proper rulemaking before implementing the changes.

The suit also claims that the new conditions imposed on grant recipients are unlawful and contradict congressionally passed statutes and HUD's own longstanding policies.

As Michigan braces for the potential fallout from these federal policy changes, state officials and advocacy groups continue to push back, emphasizing the need to protect vulnerable families and maintain the progress made in combating homelessness.

The outcome of this legal challenge could have far-reaching implications for housing assistance programs and the thousands of Michiganders who rely on them.