NYC sues Trump administration over ‘unconstitutional’ housing grant conditions
Credit: Patrick Tomasso on Unsplash
New York City, joining seven other local governments, sued the Trump administration last week over new conditions related to federal housing grants. Filed on Friday, the lawsuit challenges the Department of Housing and Urban Development (HUD) over provisions prohibiting grant recipients from using funds for programs related to diversity, equity, “gender ideology,” and immigration. The cities argue that the new conditions imposed on the HUD grants are unconstitutional and an overreach of the executive branch.
The cities and counties each received a Continuum of Care grant from HUD this year for programs to help those experiencing chronic homelessness. New York City was awarded over $53.5 million to provide rental assistance to homeless households that struggle with disabilities, HIV/AIDS, mental health, substance abuse, and family trauma.
Officials warn that losing these funds could directly jeopardize housing for over 2,700 households and put thousands more at risk of homelessness, according to a press release.
“Cities cannot be coerced into adopting federal policies through unlawful conditions on grant funding,” NYC Corporation Counsel Muriel Goode-Trufant said.
“The new conditions the U.S. Department of Housing and Urban Development has placed on congressionally-approved and previously awarded housing grants to New York City are illegal under longstanding constitutional and statutory principles.”
After HUD issued a funding notice for Fiscal Year 2024, the city applied to renew its existing Continuum of Care grants. In January, the city’s Department of Housing Preservation and Development (HPD) was awarded 40 grants totaling more than $53 million to support rental assistance for chronically homeless households and individuals facing HIV/AIDS, mental illness, substance use disorders, family trauma, and other complex needs.
Three of the grants, totaling $3,276,841 for 169 units of permanent supportive housing, were set to begin on May 1. They include newly imposed conditions that are now at the center of the lawsuit.
According to the suit, the new funding conditions are “unconstitutional” and an “overreach by the executive branch,” which lacks the authority to change conditions for federal grants without approval from Congress. Despite this, the Trump administration has added these unlawful conditions to the Continuum of Care grant program.
The city’s Department of Social Services (DSS), which oversees and manages grant applications for HPD and the city’s vast network of providers, receives roughly $6.7 million a year to provide administrative support to all of the programs that fall under the Continuum of Care.
There are 165 programs that are integral to NYC’s social safety net that are funded through the Continuum of Care grants, including: $127 million for supportive housing, $3 million for transitional housing services, $35 million for rapid rehousing support, and $1.5 million for supportive services projects.
In March, the Trump administration released the grants before immediately reversing the distribution. As reported by Gothamist, HUD said the cities could get the money back after they adhered to the administration’s new policies concerning diversity and immigration.
NYC, along with other cities like Seattle, Los Angeles, Boston, and San Francisco, says these conditions are illegal. In addition to Friday’s lawsuit, the coalition of cities plans to seek a temporary restraining order next week to block HUD from imposing or enforcing what they describe as unauthorized grant requirements.
More federal housing assistance is at risk in Trump’s proposed Fiscal Year 2026 budget, which calls for a 40 percent cut to HUD funding. The administration wants to turn federal rent assistance programs into state-based formula grants, requiring states to come up with their own program.
The proposed budget also includes a $26 billion reduction in federal housing assistance programs for the elderly and individuals with disabilities, $532 million in cuts to homeless assistance programs and housing opportunities for people with AIDS, and a $196 million decrease in funding for HUD’s Self-Sufficiency Program, which supports federal housing assistance recipients.
Christine Quinn, president and CEO of Win, the largest provider of shelter and supportive housing for families experiencing homelessness in the nation, condemned the administration’s proposed budget cuts.
“The Trump administration’s proposed cuts to federal housing assistance programs are cruel, dangerous, and will only increase poverty rates in a nation already struggling to keep families off the streets,” Quinn said.
“If enacted, these cuts represent a serious threat to the safety and well-being of millions of Americans and will drastically increase the number of those facing housing instability and homelessness.”
Friday’s lawsuit is just one of many contentious issues between New York and the Trump administration during the president’s first 100 days in office. In addition to the legal battle over the Continuum of Care grants, the administration has already cut $1.3 billion in funding for state programs.
Gov. Kathy Hochul warns that these cuts will drive up the cost of living for New Yorkers by thousands of dollars, strain public infrastructure, and exacerbate other statewide challenges.
“The first 100 days of the Trump Administration have been rife with chaos and uncertainty, from on-again, off-again tariffs to cuts to vital programs, New Yorkers are paying the price,” Hochul said. “President Trump promised relief from inflation and his policies are making life harder, chaotic and more expensive for working class New Yorkers while slashing the very services they rely on.”
The Trump administration has also canceled $325 million in disaster prevention funds for New York and threatened to withhold funding for state transportation projects unless the city halts its congestion pricing program. Additionally, the administration has warned the MTA that it may withhold funding over concerns about transit safety.
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