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Staff warns HUD shutdown and proposed funding changes could delay Glen Ellyn project, affect homeless supports
Summary
County staff told the Human Services Committee that a federal government shutdown has delayed HUD release of funds needed for the Full Circle Communities project in Glen Ellyn and that proposed HUD program changes could reduce funding for permanent supportive housing.
Marybeth, a community services staff member, told the DuPage County Human Services Committee that the federal government shutdown has paused HUD review and the release of grant funds needed for local housing and neighborhood projects.
"Until HUD's staff are back in the office, we won't be able to get that release of funds," Marybeth said, describing a stalled 15-day comment period that closed Sept. 30 and a subsequent delay in HUD signing off on the release. She said that delay prevents property closings and demolition work tied to tax-credit timelines for the Full Circle Communities project in Glen Ellyn.
Marybeth also outlined potential programmatic changes under consideration at HUD that could affect the county's homeless continuum of care. She said about $8,600,000 from HUD flows annually to a set of county agencies, with roughly 56% of DuPage’s continuum funds currently used for permanent supportive housing (PSH). According to her remarks, there are about 620 people in the county’s PSH programs, many served by agencies including PADS, Catholic Charities and Midwest Shelter for Homeless Veterans.
"There’s discussion about reducing the percentage of total funds that can be used for permanent supportive housing," Marybeth said. She explained that proposed changes under discussion could reduce allowable PSH shares (examples discussed in conversation ranged from 70% down to 30% in different scenarios) and could require mandatory engagement in services from day one rather than allowing Housing First models that permit residents to decline services initially.
Staff described the potential impacts as a cascade: delays in HUD authorization block demolition and closings for housing projects, which in turn can jeopardize tax-credit compliance and scheduled construction. Marybeth said environmental reviews for neighborhood investment projects are also on hold until HUD resumes normal operations. She said advocacy is underway to request that HUD provide a two-year noncompetitive renewal to avoid sudden program changes while stakeholders and Congress consider policy shifts.
Committee members asked whether HUD has explained the rationale for possible reductions in PSH funding; Marybeth said she had not seen a formal written rationale and that comments she’d heard indicate an administrative intent to emphasize work or self-sufficiency outcomes, but no formal guidance had been issued because HUD staff are not working.
Why it matters Delays to HUD approvals can stop a sequence of transactions — environmental reviews, closings, demolition and tax-credit access — that housing projects rely on. Changes to Continuum of Care priorities and allowable uses of funds could require local homeless-service providers to reconfigure programs and funding mixes that currently prioritize long-term supportive housing for people with disabilities and chronic homelessness.
What to watch for next Marybeth said advocates are urging Congress and HUD to allow planned noncompetitive renewals so providers have time to adapt and to avoid immediate disruptions in housing placements and services.
