Housing — News & Analysis

Attorney General Ellison wins second lawsuit against Trump Administration HUD to protect federal support for homelessness services (August 10, 2026)

August 10, 2026 — Minnesota Attorney General Keith Ellison and a multistate coalition have won their second lawsuit challenging the Trump administration's attempt to cap funding for permanent housing projects, with the U.S. District Court for the District of Rhode Island granting critical parts of the coalition's motion for summary judgment and ruling that HUD's set-aside was unlawful and cannot be implemented. Had the policy stood, more than 2,000 Minnesotans would have been at risk of losing their homes. "Twice the Trump Administration tried to impose illegal conditions on funding that helps families experiencing housing insecurity or homelessness secure permanent housing, and twice I have sued them over it and won," Ellison said, adding that administrations of both parties have prioritized evidence-based Housing First strategies for more than 20 years and calling the repeated efforts to cut or divert funding both illegal and cruel.

The Continuum of Care program has for two decades reflected HUD's commitment to the Housing First model, which places people in permanent housing rapidly without first requiring conditions such as sobriety or a minimum income threshold. Ellison and a coalition of states first sued HUD in November 2025 over illegal conditions imposed on billions of dollars in CoC funding, including a cap on how much could support permanent supportive housing. They won that case on June 30, 2026, when the Rhode Island court ruled the funding restrictions unlawful and barred their implementation. HUD then changed tactics, issuing a new notice of funding opportunity creating a $1.3 billion set-aside for new projects prioritizing transitional housing and similar approaches — which, as the office describes it, would have amounted to a de facto cap on permanent housing. Per the National Alliance to End Homelessness, that shift threatened housing for at least 97,000 residents of CoC-funded permanent housing nationwide.

The coalition returned to court on July 7, 2026, one week after the prior win, to block the revised version. New York Attorney General Letitia James, Rhode Island Attorney General Peter Neronha, and Washington Attorney General Nick Brown led the coalition, joined by the attorneys general of Arizona, California, Colorado, Connecticut, the District of Columbia, Delaware, Illinois, Maine, Maryland, Massachusetts, Michigan, New Jersey, New Mexico, Oregon, Vermont, Virginia, and Wisconsin, along with the governors of Kentucky and Pennsylvania.

Court documents: Order of August 10, 2026 · Summary judgment order of June 30, 2026