LA County homeless shelters and domestic violence service providers are facing a growing financial crisis as a federal funding dispute involving the U.S. Department of Housing and Urban Development and Los Angeles’ main homeless services agency drags on. Dozens of groups have been covering multi-million-dollar annual grants out of their own pockets, but many say their reserves are nearly gone.
The dispute centers on HUD’s delay in executing fiscal 2025 Continuum of Care renewal grants. Court records reviewed by LAist show that more than 1,300 renewal agreements nationwide — about 20% of the total — had not been fully executed as of Monday, and more than 400 had not even been issued. In Los Angeles, the problem is tied not just to an administrative backlog but to a lawsuit after HUD suspended the Los Angeles Homeless Services Authority from federal grant activity.
In August, U.S. District Judge David O. Carter ordered HUD to immediately execute contracts for 12 service providers. About a month later, the 9th U.S. Circuit Court of Appeals issued an emergency stay, pausing the order while the appeal moves forward. HUD has told LAist it is not currently required to execute the grant agreements.
Providers say the delays are already forcing layoffs and service reductions, with some organizations operating without pay for months. The longer the dispute continues, the more pressure it places on the region’s homeless safety net and the people who depend on it.
