HUD, HHS, and ONDCP are implementing a Treatment First approach to federal homelessness policy, replacing Housing First guidance through toolkits, program changes, and interagency coordination.
NBC News reported that at a White House complex meeting this summer, an aide to Stephen Miller presented a plan to make it easier for states to institutionalize mentally ill homeless people through a policy change that NBC said would weaken the rights of millions of disabled Americans. According to the report, after the Justice Department issued a memo making institutionalization easier, it began abandoning cases protecting disabled people's right to live in the community rather than in institutions.
The Justice Department's Office of Legal Counsel issued its opinion on the Olmstead integration mandate in June 2026, following the July 2025 executive order "Ending Crime and Disorder on America's Streets."
AP reporters Laura Ungar and Geoff Mulvihill reported on providers nationwide adjusting to the administration’s redirection of federal homelessness funding from permanent supportive housing toward transitional housing of up to two years with required treatment. The story cited HUD’s estimate of nearly 750,000 people homeless last year, up 31% from 2019, and roughly 173,000 permanent supportive housing beds for chronically homeless people plus 235,000 for other populations. It noted the FY2027 budget proposal would eliminate the Continuum of Care program and that an appeals court this month allowed the policy changes to proceed.
In the prior CoC competition more than 60% of funds went to permanent supportive housing and 1% to transitional housing, per the AP’s account of HUD data.
SAMHSA awarded $42.3 million in supplemental block-grant funding to states and territories to implement the July 2025 executive order "Ending Crime and Disorder on America's Streets" and the White House "Treatment First" best-practices toolkit. The total comprises $17.3 million to Community Mental Health Services Block Grant recipients and $25 million to Substance Use Prevention, Treatment, and Recovery Services Block Grant recipients for sober and recovery housing capacity, plus a separate $2 million to the Addiction Technology Transfer Center Network. The agency said the mental-health block grant portion covers technical assistance, training, policy development, and cross-system coordination rather than direct treatment services.
The executive order directing agencies to prioritize treatment and recovery over Housing First was signed July 24, 2025.
Federal Register (HUD) · on HUD's proposed Continuum of Care program incentive categories
HUD filed a 54-page notice for public inspection September 10 seeking comment on activities it proposes to incent through the Continuum of Care program, with comments due 30 days after its scheduled September 11 publication. The notice names five activity categories, including transitional housing with employment- and behavioral-health-focused services, supportive service participation agreements, drug-free and sober housing, and coordination with law enforcement and first responders. The notice states that as of 2023 a median of 6 percent of individuals in CoC-funded housing nationally increased their earned employment income during the reporting period.
On August 27 the First Circuit ordered the parties in NAEH v. HUD (26-1923) to brief what "bonuses or other incentives" means under 42 U.S.C. § 11386b(d)(1); HUD's stay motion in that appeal remains pending.
Cicero Institute · on a Cicero Institute paper on restructuring Continuum of Care funding
The Cicero Institute published a paper by Chris Sharp, Caleb Jacobs, and Ryan Prenosil proposing that HUD's Continuum of Care program shift from paying for services delivered to paying for outcomes such as exits to unsubsidized housing and employment income. The paper said total CoC provider compensation grew from $6.53 billion in 2013 to $14.22 billion in 2024, a 117.8 percent increase, while the population served grew 31 percent. It endorsed the FY2026 NOFO structure that protects 60 percent of Annual Renewal Demand and competes the remaining 40 percent, with a $1.3 billion set-aside for transitional housing and supportive-services-only projects.
The FY2026 CoC NOFO the paper endorses was vacated by the District of Rhode Island on August 7; HUD's appeal and stay motion are pending in the First Circuit (No. 26-1923).
The city is converting the Multnomah Safe Rest Village on Southwest Multnomah Boulevard into a treatment-focused shelter: it will still house people leaving homelessness, but residents will be expected to engage in treatment and counseling during their stay. KGW reported that nearby residents gave mixed reactions and questioned whether the change will resolve the livability problems they have reported around the site.
The village opened in June 2022 as the city's first Safe Rest Village and has been operated by Urban Alchemy since July 2025.
The Times reported that Joe Lonsdale's Cicero Institute has driven Republican homelessness policy, with 21 states considering camping bans or other Cicero-backed laws in recent years and 16 passing them. Former Domestic Policy Council official Scott Centorino said at a closed-door June Cicero conference that he consulted the group in drafting President Trump's homelessness executive order; Lonsdale told the Times "our work has been one of the main influences" and put his Cicero spending at "well less" than $15 million a year. The paper reported HUD's blocked NOFO sought to move two-thirds of roughly $4 billion in annual homelessness aid to time-limited programs with work rules or treatment mandates, a change opponents warned could cost as many as 170,000 formerly homeless people their housing.
The Washington Post and Mother Jones each published their own profiles of Lonsdale and the Cicero Institute the same day, August 22.
Based on leaked audio recordings, Invisible People reported that sitting HUD and White House Domestic Policy Council officials described plans to roll back Housing First at the Cicero Institute's June 5, 2026 summit in Washington, held four days after HUD released the FY2026 Continuum of Care NOFO. HUD Assistant Secretary for Community Planning and Development Ronald Kurtz told attendees "homelessness is much less a housing problem than it is a human problem," and HUD's Caitlyn McKenney said 41% of adults in HUD-funded permanent supportive housing self-report substance use disorder.
McKenney is the HUD official whose declaration accompanied the department's August 13 emergency stay motion in the district court.
HHS Secretary Robert F. Kennedy Jr. and HUD Secretary Scott Turner announced joint "Treatment First" actions on homelessness, directing closer coordination between federal housing and behavioral health systems and outreach to Continuums of Care, housing providers, treatment and recovery grantees, state and tribal partners, and faith-based organizations. HHS described the announcement as the latest action in a shift away from what the release called the failed Housing First policies of the Biden administration.
HUD, HHS, and ONDCP released the "Best Practices Toolkit: Addressing Homelessness and Addiction Through Treatment First" on August 12 (HUD release HUD-NO-26-059).