Economic Development & Technology Committee
December 16, 2025

Department of Housing

CUTS IN COUNTY, STATE, AND FEDERAL

HOMELESS PROGRAMS FUNDING
Economic Development & Technology Committee
December 16, 2025
Department of Housing
Background
• The Department receives grant funding from multiple sources for homeless services
> U.S Department of Housing and Urban Development
 Continuum of Care (CoC): $6,489,316 (partially competitive)  Emergency Solutions Grant: $189,807
» *Rapid Unsheltered Survivor Housing disaster grant: $1,000,000 > State of California
 *Homeless, Housing, Assistance, and Prevention (HHAP) » Round 5: $799,523
» Round 6: $677,599 (not yet received; application submitted 8/27/25)  *Encampment Resolution Fund (competitive grant)
» Round 2R: $2,080,380
» Round 4L: $2,772,801
 *Family Homelessness Challenge (competitive grant)
» Round 1: $644,211
» Round 2: $789,474
*multi-year grants only partially budgeted in FY 2026
2 Department of Housing
Background
> Los Angeles County
 Measure H CoC Allocation: FYs 2018-2025
 Housing Incentive Program: $218,505
 Measure A
» CoC Allocation: $1,324,440
» Local Solutions Fund: $867,473
» Los Angeles County Affordable Housing Solutions Agency (LACAHSA) portion passed through Burbank-Glendale-Pasadena Regional Housing Trust
» Production, Preservation, and Ownership (PPO): $1,407,935 » Renter Protection Homelessness Prevention (RPHP): $1,237,150 » Technical Assistance: $188,383
3 Department of Housing
Federal Continuum of Care Funds
• 2025-2026 program year Continuum of Care grants total: $6,489,316 > 15 individual grants
 Permanent Housing: $5,708,724 (87.97%)
» Permanent Supportive Housing: $4,202,327
» 362 persons served annually with rental assistance and/or supportive services
» Rapid Rehousing: $1,506,397
» 109 persons served annually with rental assistance and supportive services
 Coordinated Entry: $286,230 (4.41%)
 Planning: $253,558 (3.91%)
 Homeless Management Information System: $240,804 (3.71%) • The Consolidated Appropriations Act, 2024 authorized a two-year Notice of Funding Opportunity (NOFO) to cover federal FY 2024 and FY 2025 CoC awards
> Second year of funding was expected to be authorized by a FY 2025 Congressional Appropriation
4 Department of Housing
Federal Continuum of Care Funds
• November 13, 2025: HUD released the FY 2025 CoC and Youth Homelessness Demonstration Program Grants Notice of Funding Opportunity (NOFO) > Introduced sweeping changes
 Funding for permanent housing capped at 30% of total award » 88% of CoC grant funding currently supports permanent housing  Changes to tiering system (i.e., project prioritization) to increase competition » Tier 1: 30% of funding (was 90% in 2024)
» Funded non-competitively
» Tier 2 : 70% of funding (was 10% in 2024)
» Funded competitively
 Changes in scoring significantly disadvantage Pasadena CoC and all projects that fall in Tier 2
 New priorities emphasize extensive service participation requirements, increasing employment income, and cooperation with law enforcement to support anti-camping laws
5 Department of Housing
Federal Continuum of Care Funds
• Potential Impacts of NOFO’s Proposed Changes
> Pasadena would be forced to reallocate at least two thirds of permanent housing funding to other program types
 Approximately 214 individuals could lose their housing > 70% of CoC funding at risk
• Two lawsuits have been filed to challenge the NOFO
> 11/25/25: State of Washington, et al. vs. U.S. Department of Housing and Urban Development
 Plaintiffs include 22 states and District of Columbia > 12/1/25: National Alliance to End Homelessness, et al. vs U.S.

Department of Housing and Urban Development, et al.
 Plaintiffs include a broad coalition of nationwide non-profit organizations and local governments
• On 12/8/25, HUD withdrew the NOFO just hours before a scheduled hearing > HUD has indicated that it intends to make revisions and publish a new NOFO > At the next hearing on 12/19/25, the judge will consider arguments on plaintiff’s motion for a preliminary injunction.
6 Department of Housing
Federal Continuum of Care Funds
• If HUD proceeds with releasing a new NOFO, funding will be further significantly delayed, potentially causing gaps in funding and services. > The City directly administers a $1,458,019 grant which funds scattered-site permanent supportive housing for households that previously experienced chronic homelessness.
 Current grant will expire 2/28/26
 Average monthly expenditures: $72k rental assistance +$11k supportive services
 City could have $300k+ in expenditures before HUD makes any award announcements
• To prevent delays in funding and harm to vulnerable populations, Congress could include a provision in an upcoming appropriations bill honor the previously authorized two-year CoC NOFO and renew current CoC grants for a 12-month period without a new NOFO.
7 Department of Housing
State HHAP Funds
8 Round Award Expended as of
10/31/25
Expires
HHAP 1 $638,479 $638,479 6/30/25
HHAP 2 $302,105 $301,116 6/30/26
HHAP 3 $811,207 $631,307 6/30/26
HHAP 4 $680,593 $593,381 6/30/27
HHAP 5 $799,523 $3,403 6/30/28
HHAP 6
(not yet received)
$677,599 $0 6/30/29
• Department’s FY 2026 Operating Budget includes $739,860 of HHAP • HHAP currently funds street outreach, rapid rehousing, and motel voucher programs.

Department of Housing
State HHAP Funds
9 • State FY 2026 budget does not include funds for HHAP Round 7 > State has committed to funding HHAP 7 at $500 million in FY 2027 > HHAP Rounds 3-6 were funded at $1 billion each in FY 2022- FY 2025 > Effectively a 75% reduction over a two-year period
• Anticipated impacts of reduced funding
> Fewer motel-based shelter beds
> Reduction or elimination of street outreach programming > Reduction in permanent housing resources
Department of Housing
Other State Funds
• Encampment Resolution Fund
> Street outreach, motel-based shelter, and housing navigation > Round 2R: $2,080,380
 Serves people living on Cal Trans property (i.e., freeway embankments)  Expires: 8/22/27
> Round 4L: $2,772,801
 Serves people living in 10 prioritized sites on private and Metro property  Expires: 10/4/27
• Family Homelessness Challenge
> Homelessness prevention services including payment of rental arrears for families with minor children at imminent risk of homelessness > Round 1: $644,211
> Round 2: $789,474
> Both rounds expire 6/30/26
Department of Housing
LA County Funds
Los Angeles County projects a $303,555,000 deficit in homelessness services funding in FY 2027
• Causes
> New and expanded cost obligations coupled with the loss or reduction of State, federal, and other one-time funding sources
> Projected decrease in Measure A sales tax revenue due to shifts in consumer spending
> Substantial difference in the amount of one-time carryover funding available between FY 2026 and FY 2027
• Proposed Spending Plan
> $92 million reduction in new funding for Pathway Home (motel master leasing interim housing program)
> $127 million in programmatic cuts across the system
 Street outreach and engagement, regional coordination, prevention, non- housing related supportive services, housing navigation, and unit acquisition
> Leveraging $39 million of one-time sources to offset defecit > Closed the balance of the deficit with “programmatic
efficiencies”
Department of Housing
LA County Funds
The County’s draft FY 2027 Spending Plan includes a proposed cut of a $10 million allocation to the three city Continuums of Care (Pasadena, Glendale, and Long Beach)
• County cites Local Solutions Fund and other Measure A funding passed through LACAHSA
> Pasadena’s Local Solution Fund is fully committed to support 35 formerly homeless households permanently housed with expiring federal rental subsidies
• Potential impacts of elimination of Measure A CoC Allocation > $1.32 million reduction in funding to Pasadena in FY 2027 > Reduced availability of motel vouchers, rapid rehousing/time limited subsidies, and reduced or eliminated housing navigation services. • January 27, 2026: Board of Supervisors will vote to approve proposed spending plan
Department of Housing
Conclusion
• 92% of the Department’s Supportive Housing Division’s FY 2026 budget for homeless services is funded by federal, state, and county sources that are either under serious threat of reduction or elimination or expiring in the next 18 months.
• With funding reductions at multiple levels, the entire regional homeless services system is contracting significantly.
• Countywide, the availability of homeless services will be significantly reduced, which will result in fewer people being housed, reduced shelter bed availability, and longer periods of unsheltered homelessness. • The visibility of street homelessness is likely to increase. • Other City Departments including Police, Fire, Public Health, Library, and PRCS may experience increased impacts of homelessness.
13 Department of Housing
Advocacy
• Continued advocacy to the Board of Supervisors to maintain the Measure A CoC Allocation
• Advocacy to state lawmakers to fund HHAP Round 7 at $1 billion in FY 27
• Continued advocacy to federal lawmakers to renew existing CoC grants without a NOFO
14