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City manager says Cambridge joined lawsuits after HUD withdrew new Continuum‑of‑Care guidelines
Summary
City Manager reported that HUD's mid‑November changes to Continuum of Care carryover rules (reducing carryover from 90% to 30%) posed an 'enormous risk' to supportive‑housing funding; Cambridge joined a multi‑jurisdictional lawsuit and the court prompted HUD to withdraw the 2025 guidance pending further process.
City Manager updated the council on an escalating federal policy dispute that could affect homelessness services funded under HUD’s Continuum of Care program.
Yan Wong told the council that HUD released guidance in mid‑November that would have sharply reduced the carryover of annual funding from 90% to 30%, a change the city manager described as "an enormous risk of putting individuals back on the street." He said Cambridge manages a Continuum of Care portfolio of approximately $6.4 million that supports more than 200 people locally and that the guidance’s sudden implementation left local nonprofit partners scrambling to rebid or reprice programs under a compressed timetable.
Wong said Cambridge joined a multi‑jurisdictional legal challenge alongside Boston, San Francisco and other cities and counties. He reported that, during a combined hearing in federal district court in Rhode Island, HUD withdrew the 2025 program guidelines less than 90 minutes before the hearing; the court set an expedited timeline and lawyers for the federal government said HUD intends to revise and possibly reissue program guidance as a new Notice of Funding Opportunity (NOFO). "The federal government is therefore trying to leave open the potential to reissue these program guidelines... which places the future of funding in jeopardy," Wong said.
City legal staff briefed the council on two related tracks of litigation: (1) the combined challenge to the Continuum of Care guidance filed by multiple municipalities and (2) pending litigation and appellate activity involving other executive actions directed at sanctuary jurisdictions. The city solicitor told the council the judge in Rhode Island was "very displeased" with HUD’s last‑minute withdrawal and that plaintiffs' attorneys had worked through the weekend to prepare the hearing.
Wong described the city's short‑term work: coordinating with nonprofit partners to understand potential bid impacts, preparing to litigate, and tracking possible Congressional language to preserve 2024 carryover rules in an omnibus appropriations bill. He said that because HUD withdrew the guidance, the immediate bidding process is on hold and staff are awaiting clarity before requiring nonprofit partners to deliver revised proposals that had been due on a compressed schedule.
Councilors asked for a clearer list of programs potentially at risk and more detail on operational impacts; city staff said they will provide a fuller federal‑grant status update at next week’s meeting and a more comprehensive briefing on the implications for the FY26 budget and FY27 projections in the months ahead. The city manager said he expected the court could issue a temporary restraining order or preliminary injunction on an expedited timetable, possibly before the end of the year.
Ending: The city will continue litigation and coordination with regional plaintiffs; staff will return with a comprehensive federal grants update and continue regular briefings as the litigation and NOFO process unfold.
