Continuum of Care Program

(Homeless Assistance)

Department of Housing and Urban Development

Proposed Cut

$393M

% Reduction

9.0%

Action Type

reduction

Who Is Served

~650,000 shelter beds/housing units; homeless individuals and families

Summary

The Continuum of Care Program is the main federal grant program that helps local communities fund homeless shelters, transitional housing, and permanent supportive housing. The FY2027 budget proposes cutting the program by $393 million, a 9% reduction, as part of a plan to fold Continuum of Care funding into an expanded Emergency Solutions Grants program that emphasizes emergency shelter over long-term supportive housing.

Who Is Affected

The cut affects roughly 650,000 shelter beds and housing units nationwide, run by local nonprofits, cities, and about 400 regional Continuum of Care planning bodies that coordinate homeless services. It would hit hardest people with disabilities in permanent supportive housing, including some of the 152,585 people HUD counted as chronically homeless in 2024, a group that relies on long-term rental assistance paired with services like mental health and addiction treatment.

What this cut would actually mean

If permanent supportive housing funding shrinks while emergency shelter funding grows, fewer people with long-term disabilities and chronic homelessness would get stable housing with support services, and some existing supportive housing units could lose renewal funding and close. Advocacy groups and providers warn this would push more people back onto the streets or into short-term shelter, increasing the number of people cycling in and out of homelessness rather than exiting it permanently, at a time when the national point-in-time count already found over 770,000 people homeless in a single night in January 2024.

Sources

Evidence Shows Permanent Supportive Housing Helps People Exit Homelessness. A Proposed Funding Change Would Cut Those Programs. — Explains that over 400,000 permanent supportive housing beds exist nationwide, with 171,490 dedicated to chronically homeless people, and warns that shifting funds away from PSH toward emergency shelter would undercut a model shown to reduce chronic homelessness.
HUD Releases January 2024 Point-In-Time Count Report — HUD's official report finding more than 770,000 people were experiencing homelessness on a single night in January 2024, an 18% increase from the prior year.
Homelessness at a Record High: Key Takeaways from the 2024 PIT Count — Reports that 152,585 people met HUD's definition of chronic homelessness in 2024, about one in three homeless individuals, and describes growth in Permanent Supportive Housing and Rapid Rehousing capacity.
HUD Funding Finally Set for FY26 - Housing Assistance Council — Describes the administration's proposal to merge the Continuum of Care, Housing Opportunities for Persons with AIDS, and Emergency Solutions Grants programs into an expanded Emergency Solutions Grant, shifting focus toward state and local government-run emergency shelter.
CoC Program Funding at Risk — Details how Continuum of Care funds are the largest source of supportive housing and rapid rehousing funding in states like Ohio, and warns that cuts or disruptions could force programs serving people with disabilities to shut down.