Philadelphia stands to lose tens of millions of dollars in federal funds intended to fight homelessness under a plan issued by the Trump administration that advocates say could significantly disrupt permanent housing programs and return formerly homeless people to the streets.
The U.S. Department of Housing and Urban Development released the plan earlier this month, saying it would “restore accountability” and promote “self-sufficiency” in people by addressing the “root causes of homelessness, including illicit drugs and mental illness.”
Nationwide, advocates say, the HUD plan could displace 170,000 people by cutting two-thirds of the aid designated for permanent housing.
The number of individuals in Philadelphia at risk of losing stable housing hasn’t been tallied because the city’s Office of Homeless Services (OHS) is still reviewing the plan’s impact, said Cheryl Hill, the agency’s executive director.
Overall, there are 2,330 units of permanent housing, many of them financed by $47 million the city received from HUD last year, according to city officials.
The new strategy comes as Mayor Cherelle L. Parker attempts to move ahead with an ambitious plan to increase the supply of affordable housing in the city. Parker declined to comment on the Trump administration’s policy shift.
A preliminary analysis by HopePHL, a local anti-homelessness nonprofit, estimates around 1,200 housing units with households of various sizes would lose federal aid and no longer be accessible to current residents, all of whom are eligible for the aid because they live with a physical or mental disability.
HUD plans to funnel most of the funding for permanent housing into short-term housing programs with requirements for work and addiction treatment. The agency also said that it’s increasing overall homelessness funding throughout the United States, from $3.6 billion in 2024 to $3.9 billion.
“This new plan is disastrous for homelessness in Philadelphia,” said Eric Tars, the senior policy director of the National Homelessness Law Center, who lives and works in Philadelphia. “The biggest immediate harm would be that those who were once homeless but are now successfully living in apartments will be forced out of their homes.”
Other critics say the policy is based on a failed model that strips away civil liberties and doesn’t address what scholars and people who run anti-homelessness agencies say is the main reason Americans are homeless: the dearth of affordable housing.
“We have broad concerns about what we’re seeing,” said Candice Player, vice president of Advocacy, Public Policy and Street Outreach for Project HOME, the leading anti-homelessness nonprofit in Philadelphia. “We are all in a very difficult position here.”
Amal Bass, executive director of the Homeless Advocacy Project, which provides legal services to those experiencing homelessness, agreed, saying the city is “bracing for homelessness to increase in Philadelphia as a result of these policy choices.”
The need to house thousands of people suddenly made homeless would force cities, counties, and states to spend money they may not have, according to a statement from the National Alliance to End Homelessness.
Asked for comment, a HUD spokesperson sent a statement saying the agency seeks to reform “failed policies,” and refutes claims that the changes will result in increased homelessness.
HUD hopes that current permanent housing shift to transitional housing will include “robust wraparound support services for mental health and addiction to promote self-sufficiency.”
The agency added that it wants to encourage the “12,000 religious organizations in Pennsylvania to apply for funding to help those experiencing homelessness.”
New restrictions on ‘gender ideology extremism’
The federal government funds local governments to address homelessness through so-called Continuums of Care (CoC), local planning bodies that coordinate housing and other services. In Philadelphia, the CoC is staffed by the city’s Office of Homeless Services, and governed by an 18-member board, including homeless and housing service providers, and physical and behavioral health entities.
In its plan, HUD will require the local planning bodies to compete for funding, and will attach ideological preconditions that could affect how much money a community like Philadelphia receives.
For example, the new HUD plan “cracks down on DEI,” essentially penalizing a local board for following diversity, equity, and inclusion guidelines. HUD would also limit funding to organizations that support “gender ideology extremism“ — programs that “use a definition of sex other than as binary in humans.” And HUD will consider whether the local jurisdiction“prohibits public camping or loitering,” an anti-encampment mandate that advocates such as the Legal Defense Fund say criminalizes homelessness.
Funding for programs that keep people in permanent housing could be cut off as early as January, according to HUD documents.
Philly an early adopter of Housing First
The new HUD policy dovetails with the views of President Donald Trump, who signed an executive order in July that sought to make it easier to confine unhoused people in mental institutions against their will.
Trump has also said he wants municipalities to make urban camping illegal, helping to clear homeless encampments from streets and parks. He’s expressed a preference for moving people who are homeless from municipalities to “tent cities.”
Planners in Utah are working toward creating such a facility known as an “accountability center” that would confine people who are experiencing homelessness and force them to be treated for drug addiction or behavioral health issues.
HUD’s new direction is a repudiation of Housing First, which gives people permanent housing and offers services without making them stay in shelter and mandating treatment for drug abuse or behavioral health issues. Philadelphia was an early adopter and was the first U.S. city to use it specifically for people with opioid disorders, according to Project HOME, which was cofounded by Sister Mary Scullion, an early proponent of Housing First.
Time and again it’s been proven that “offering, rather than requiring, services to help those who are homeless, has greater effect,” said Michele Mangan, director of Compliance and Evaluation at Bethesda Project, which provides shelter, housing, and case management services to individuals experiencing homelessness in Philadelphia.
The administration’s move toward transitional housing and required treatment hasn’t worked before, according to Dennis Culhane, a social policy professor at the University of Pennsylvania who’s an expert in homelessness and assisted housing.
The people most in need of help couldn’t comply with clean and sober requirements and were evicted, he said.
“It’s a misguided approach that blames the victim and fails to address the lack of affordable housing,” Culhane said. On the other hand, Housing First has had an 85% success rate in helping to lead people out of homelessness, Culhane said.
He added that he “distrusts the administration’s motivation. It just wants people out of sight and moved into fantastical facilities with tents and alleged care because they’re seen as a nuisance.”
Ultimately, said Gwen Bailey, HopePHL’s vice president of programs, it’s not clear whether the Trump administration “thinks it’s doing the right thing. I don’t know their data.
“But in Philadelphia right now, today, I see all kinds of people facing frightening situations.”
Staff writer Sean Collins Walsh contributed to this article.
