Judge pauses Trump administration’s suspension of LA homelessness funds

A federal judge on Thursday granted a preliminary injunction on the federal government’s suspension of granting funds to the L.A. region’s lead homelessness agency.

The order from U.S. District Judge David O. Carter means the Los Angeles Homeless Services Authority can apply for federal homelessness funds used to provide services and housing to 11,000 people in the area.

Carter ordered the U.S. Department of Housing and Urban Development to distribute about $241 million anticipated to the L.A. region in this year’s homelessness funding competition. HUD was also ordered to pay out grants already awarded last year within 45 days, which LAHSA told LAist amounts to about $66.5 million.

HUD suspended LAHSA from federal grant activity in June, citing alleged mismanagement by the agency. LAHSA filed a lawsuit to overturn or pause the suspension, which is what led to last week’s hearing in downtown L.A. where officials with the agency and Trump administration faced off in court.

What happened?

The judge acknowledged that LAHSA “may be dysfunctional,” but said thousands of people experiencing homelessness rely on those services. He said HUD “abruptly” pulled the rug from under providers and the unhoused people they serve.

“Inevitably, this suspension will result in deaths among the homeless and the displacement of over 11,000 unhoused individuals onto the streets and into the neighborhoods of Los Angeles,” Carter wrote in his order. “It is much easier to destroy a dysfunctional homelessness system than to take the time and care necessary to make the system function properly,” he continued.

Gita O'Neill, interim CEO of LAHSA, said the ruling is a vital victory for the entire L.A. region.

"By halting this abrupt suspension, the Court has ensured that life-saving housing and shelter programs remain operational without catastrophic disruption," O'Neill said in a statement. "LAHSA remains fully focused on supporting our service providers, and advancing transparent, accountable regional coordination."

HUD Secretary Scott Turner said he'll be working with the Department of Justice to "fight this legally."

"The court ordered HUD to send tens of millions of dollars directly to LAHSA, an organization that has proven to be incompetent with YOUR tax dollars," Turner said on social media. "The money that YOU worked hard to earn!"

Officials respond

L.A. County Supervisor Kathryn Barger said the ruling is fair, measured and strikes an appropriate balance by preserving short-term stability while creating a clear path toward accountability.

"The Court's approach aligns with our County's longstanding position that reform should be deliberate and responsible," Barger said in a statement. "Change is necessary, but it must be implemented in a way that does not pull the rug out from under vulnerable individuals who depend on these services today."

The L.A. Continuum of Care, run by a 21-member board, is responsible for setting regional funding priorities and designating the local entity that applies for federal homelessness grants. Ben Kay, board chair, said the ruling protects the community's ability to secure funding that saves lives.

"Congress built this system so local communities — not Washington — would set their priorities," Kay said in a statement. "This is a win for the people of Los Angeles and for every person who depends on this system to stay housed."

What's next?

All parties have been ordered to appear in court on Oct. 27 for a status conference, which is when the preliminary injunction expires. A trial is scheduled to start next February.