Nashville has joined a national lawsuit challenging new federal homelessness funding rules that city officials say could force nearly 1,000 people back into unsafe housing or homelessness.
The lawsuit argues the Trump–Vance administration rewrote the U.S. Department of Housing and Urban Development’s Continuum of Care program without congressional approval or public input. City officials say the sudden shift threatens long-running housing programs used by veterans, seniors, people with disabilities, families and domestic-violence survivors.
“The new rules will decimate permanent supportive housing and the Continuum of Care program as we know it—undoing proven, lifesaving programs Nashville has used for years to move people from homelessness to successfully housed,” Mayor Freddie O’Connell said.
City leaders say the issue matters because the Continuum of Care program is the backbone of Nashville’s system to transition people out of homelessness, and the changes could eliminate most existing projects. The lawsuit also alleges HUD’s new requirements conflict with federal protections for domestic-violence survivors.
The dispute centers on HUD’s Nov. 13 decision to rescind and replace a key program notice and revise its 2025 funding competition. The new criteria would sharply reduce support for long-term housing projects in favor of treatment-focused transitional housing models.
Supporters of the change say the prior approach failed. HUD Secretary Scott Turner said the reforms are designed to reward programs that show measurable recovery and independence.
“We are stopping the Biden-era slush fund that fueled the homelessness crisis, shut out faith-based providers simply because of their values, and incentivized never-ending government dependency,” Turner said.
“These long-overdue reforms will promote independence and ensure we are supporting means-tested approaches to carry out the President’s mandate, connect Americans with the help they need, and make our cities and towns beautiful and safe,” Turner said.
HHS Secretary Robert F. Kennedy Jr. also endorsed the overhaul, calling it a shift toward treatment-based models. “This transformative policy reform will break cycles of addiction, empower self-sufficiency, and drive lasting recovery,” he said.
Wally Dietz, Nashville’s Director of Law, said the city joined the legal challenge because the new framework would dismantle a system that has reduced deaths and stabilized many residents. “The Trump administration is taking a wrecking ball to a system that works; evidence shows that a housing first policy has reduced the number of people experiencing homelessness by significant percentages,” Dietz said.
The lawsuit is backed by a coalition of cities and nonprofit groups and is being litigated with support from the Public Rights Project. A federal court will determine whether HUD can implement the rule changes while the case proceeds.
