A Timeline and Update on HUD's Continuum of Care (CoC) Program Funding

January 22, 2026Jessilyn Averill

Since November 2025 HUD has sowed chaos by creating unnecessary delays and greater uncertainty for communities across the country funded by HUD’s FY2024-2025 Continuum of Care (CoC) Program. When HUD released a new and harmful funding competition notice in late fall, it jeopardized the vital CoC resources these communities use for permanent housing.

For Washtenaw County, that new Notice of Funding Opportunity (NOFO) put $7 million in CoC funding for permanent housing at-risk. If implemented, more than 800 people in our county could have lost their housing. Fortunately, HUD rescinded that NOFO in early December.

HUD’s demonstration of irresponsible decision-making has meant the need for the courts to intervene. Below is a timeline of what HUD has been attempting to do, the lawsuits and court hearings in response to HUD’s actions, and an update on where we are now with the CoC Program funding.

Prior to November 13, 2025: FY2024-2025 Continuum of Care (CoC) Notice of Funding Opportunity (NOFO) grant agreement in place – a 2-year contract of funding covering FY2024 and FY2025.

November 13, 2025: HUD issues the FY2025 CoC NOFO, reversing prior guidance that FY2025 would be a recertification year following FY2024’s competitive process.

This new NOFO significantly altered the service delivery model including asking for client religious information, eliminating mental health as a disability and requiring dedicated substance use and mental health beds; jeopardizing housing stability for 7,000+ Michigan households, including 2,100 families with children.

December 1, 2025: Lawsuits filed by local governments and nonprofit groups challenging the new, unlawful restrictions that threaten proven solutions to homelessness. Read the full complaint filed on December 1 here.

Lawsuits filed by nonprofits (link)

Lawsuits filed by state Attorneys General, including Michigan (link)

December 8, 2025: First hearing for two lawsuits challenging HUD's unlawful restrictions on CoC NOFO. Unfortunately, the hearing was largely disrupted by HUD’s decision to rescind the FY2025 CoC NOFO with the stated intention of reissuing it.

December 8, 2025: HUD withdraws the FY2025 CoC NOFO without notice so that HUD can make revisions, pausing the process indefinitely. This action continues further and severe delays for FY2024 CoC NOFO grant communities, including Washtenaw County’s CoC.

December 19, 2025: Second hearing for two lawsuits challenging HUD's unlawful restrictions on CoC NOFO. Hearing is in front of judge for the U.S. District Court of Rhode Island (RI) who considers arguments on plaintiffs’ Motion for Preliminary Injunction.

December 23, 2025: RI District Court Judge issues written order on plaintiffs’ Motion for Preliminary Injunction, which stops the Administration from moving forward with the FY2025 CoC NOFO and requires HUD to take steps necessary to process the FY2025 renewal grants under the original FY2024-2025 CoC NOFO – short of obligating any money.

This preliminary injunction temporarily blocks HUD from canceling the FY2024-2025 NOFO and issuing a new NOFO that could result in immediate housing instability or a return to homelessness for more than 170,000 people. The preliminary injunction protects individuals, families, Veterans, seniors, youth, and many others from displacement during the winter months.

December 30, 2025: HUD submits its FY2024-2025 funding Plan to the Court. Read the Plan here. This is a parallel process to the current litigation last heard on December 23.

January 8, 2026: HUD issues a notice announcing that the FY2024-2025 CoC NOFO will reopen on Friday, January 9, 2026, and remain open until Monday, February 9, 2026. The notice also states that HUD anticipates selecting awards no later than late March 2026.

HUD has made clear that if the court order is no longer in effect, it will not continue processing awards under the FY2024-2025 NOFO and that it intends to implement the NOFO issued on December 19, 2025. The case is continuing to final judgment on an expedited basis.

January 9, 2026: HUD reopens the FY2024-2025 CoC NOFO.

January 30, 2026: Deadline for Congress and Senate to pass FY2026 Spending Bill or extension of current Continuing Resolution to avoid another government shutdown. If a shutdown happens, then the CoC NOFO timeline is once again shifted…more later due dates, later grant awards, later contracts, etc.

CoC programs across Michigan, and the country, will continue to experience gaps in funding jeopardizing their CoC resources their communities’ use for permanent housing (permanent supportive housing and rapid re-housing). This loss comes at a time when we need MORE permanent housing investments NOT less.

February 3, 2026: House of Representatives passes the FY2026 HUD appropriations bill in a narrow 217 to 214 vote, following months of negotiation and nationwide advocacy, and averting a wider government shutdown. The final spending bill provides $77.3 billion for HUD programs in FY2026. The bill includes funding considerations for the FY2025 and FY2026 CoC Program. This bill does NOT make the pending litigations null and void.

February 4, 2026: Members of Washtenaw County’s CoC present to the Washtenaw Board of Commissioners an update on HUD’s CoC Program funding delays and its impact on our CoC.

February 27, 2026: RI District Court Judge denies emergency motion filed by HUD asking the court to end the lawsuit and dissolve the preliminary injunction from December 2025. HUD argued that the FY2026 appropriations bill signed on February 4 spells out what HUD must do making the litigation moot. The Court disagrees and concludes that the Plaintiffs continue to face imminent, irreparable harm. HUD is required to renew grants based on the timeline set by the bill.

March 4, 2026: Washtenaw Board of Commissioners vote unanimously to authorize a temporary appropriation of $432,000 to support eligible housing services in the county. This gap funding will be administered by the Office of Housing and Economic Development (OCED) to housing services at risk due to HUD contract renewal delays.

March 31, 2026: HUD finally disburses payments for Quarter 1 renewal funding of the CoC FY2025 NOFO. Total disbursement is over $349 million to 622 projects that had funds expire in the first quarter of 2026.

April 1, 2026: First Circuit Court of Appeals rejects Administration’s request to overturn the court order decided on December 19 that blocks the Administration’s attempts to implement unlawful and unreasonable restrictions as outlined in a new NOFO for FY2025 HUD released in late 2025. The new NOFO would have upended the stability of the CoC program required by law, and would have had a devastating impact for communities, unhoused and previously unhoused children, youth, adults, and families, and the service providers who rely on federal funding to provide needed help.

April 27, 2026: HUD disburses payments for Quarter 2 renewal funding of the CoC FY2025 NOFO. Total disbursement is over $1.09 billion to 1,826 projects that had funds expire in the second quarter of 2026.

May 21, 2026: HUD disburses payments for Quarter 3 and 4 renewal funding of the CoC FY2025 NOFO. Total disbursement is over $2.4 billion to 4,241 projects that had funds expire in the third and fourth quarters of 2026.

June 1, 2026: HUD releases the FY2026 Notice of Funding Opportunity (NOFO) for its CoC Program.

In previous HUD CoC funding competitions, 90% of a community’s CoC Program funding was mostly guaranteed; in the FY2026 NOFO, only 60% of the community’s funding is mostly guaranteed (placed in Tier 1 of a ranked project listing in the community’s application to HUD).

For FY2026, Permanent Housing funding is limited relative to prior years and there is greater competition – across the country – for renewal dollars than in previous years, which jeopardizes the stable – but relatively flat – resources of homeless response systems nationwide, including in Washtenaw County.

Read NAEH’s detailed analysis of the FY2026 CoC NOFO here.

June 30, 2026: The U.S. District Court for the District of Rhode Island rules that HUD and HUD Secretary Turner violated the law with both FY2025 November and December NOFOs (Notices of Funding Opportunities).

August 7, 2026: The RI District Court for the third time blocks HUD’s attempt to release an unlawful homelessness funding announcement (FY2026 NOFO) for its CoC Program; effectively pausing the new notice and blocking the changes to funding priorities that HUD is attempting to implement. As the district court notes in its ruling, HUD is only permitted to provide bonuses or incentives for strategies proven effective at reducing homelessness other than permanent housing when there is supporting evidence and an opportunity for public comment.

September 11, 2026: HUD publishes a Federal Register notice to solicit public comment on “Research Justifying Additional Incentives for Certain Activities to Reduce Homelessness.” Public comment opens for 30-days. Closing date is Tuesday, October 13, 2026.

However, between the August 7 ruling and opening public comment on September 11, HUD appeals the RI District Court’s decision in the First Circuit Court of Appeals.

September 16, 2026: First Circuit Court of Appeals strikes down the RI District Court’s decision, allowing HUD to proceed with its FY2026 NOFO for now.

September 22, 2026: National Alliance to End Homelessness (NAEH) files an emergency motion with the First Circuit Court asking the court to let NAEH present the many arguments on why HUD’s current FY2026 NOFO is unlawful as quickly as possible – and ask the court to stop this unlawful and harmful NOFO before HUD actually makes any awards under it. Read more context here on why NAEH files its emergency motion.

September 30, 2026: Washtenaw CoC submits its FY2026 NOFO. The deadline Congress set for HUD to make grant awards is December 1, 2026.

Looking Ahead: Our collective effort to preserve critical federal funding to protect the people CoCs serve is not over. Though CoCs across the country submitted their FY2026 applications, it is still possible the unlawful FY2026 notice could be blocked in the courts again. What happens in the months to come will most impact current and formerly homeless people and the programs that serve them for years to come.

Sources

Update on the 2026 CoC NOFO (National Alliance to End Homelessness)

Court Sides With Coalition Challenging Latest Efforts to Politicize Homelessness Funding Grants (Democracy Forward)

Court Vacates Unlawful Funding Criteria for Solutions to Homelessness in Case Brought by Broad Coalition (National Alliance to End Homelessness)

Appeals Court Rejects Latest Trump-Vance Administration Attack on Funding for Solutions to Homelessness (National Alliance to End Homelessness)

HUD Releases First Round of Renewal Funding for Continuums of Care (National Network for Youth)

FY2025 HUD CoC Competition Timeline (Homeless Action Network of Detroit, HAND)

FY26 Final Analysis and Final HUD FY26 Budget Chart (National Low Income Housing Coalition)

Proof Point (National Alliance to End Homelessness)

FY26 HUD Appropriations Bill Clears Congress (CSH)

Briefing Document: HUD CoC NOFO Impact (Michigan Coalition Against Homelessness)

CEO Corner: Week of January 13, 2026 (National Alliance to End Homelessness)