The Alliance and the National Low Income Housing Coalition have received many questions from Continuum of Care recipients on the status of funding as it relates to current litigation. Below are more detailed responses to some of these questions we have received. Please note that because this is an active court case, there are some limits on what we can say publicly. We ask that you not share this information publicly for the time being.
What is this Lawsuit about?
The Alliance, the National Low Income Housing Coalition, and our co-plaintiffs filed suit in Rhode Island against the U.S. Department of Housing and Urban Development (HUD) on December 1, 2025, in response to the unlawful cancellation of the original FY24-25 Continuum of Care (CoC) Notice of Funding Opportunity (NOFO), originally issued in summer 2024, and the subsequent issuance of a new FY25 CoC NOFO (which this FAQ will refer to as the “November NOFO”). The November NOFO that included many unlawful provisions and significantly cut down on funding available for renewal and permanent housing projects. You can see the details of our complaint here: gov.uscourts.rid.60977.1.0.pdf
A similar lawsuit was filed by a coalition of state Attorneys General and Governors on November 25 in the same Court. The judge is considering these cases together.
What Has the Court in Rhode Island Ruled So Far?
It is important to emphasize that the lawsuit is not over, so nothing is final at the time of publishing this FAQ page (January 9, 2026).
In response to the lawsuits filed, HUD unexpectedly withdrew the new November NOFO on December 8, 2025. This was right before a scheduled hearing that same day, and HUD stated that it intended to issue a new NOFO in the future.
The Court then held a second hearing on December 19. The Court heard arguments regarding the Alliance and our co-plaintiffs’ request to stop HUD from moving forward with a new FY25 CoC NOFO and to reinstate the original FY24-25 CoC NOFO for this funding cycle.
At the end of that hearing, the Judge issued a verbal order granting the relief we sought, and a written order followed on December 23. That order reinstated the FY 24-25 CoC NOFO, ordered HUD to begin processing eligible renewals under that NOFO, and prohibited HUD from giving effect to any new NOFO. It also indicated that many of the conditions that had been included in the November NOFO were likely unlawful.
The same night of the hearing (December 23), HUD issued yet another new FY25 CoC NOFO, but with a note attached acknowledging that it was NOT in effect due to the Preliminary Injunction issued by the Court. This FAQ willI’ll refer to that NOFO as the “enjoined December 2025 NOFO.”
Key Things to Note as Litigation Progresses
- The Court is taking this case very seriously. The Court found that the plaintiffs are likely to win based on the merits of the case, that serious harm would occur if the Court did not step in, and that the balance of equities and public interest support the plaintiffs.
- The original FY24-25 CoC NOFO is currently in place. The Ccourt has stayed – or temporarily halted – HUD’s cancellation of the original FY24-25 NOFO.
- The Court has temporarily halted HUD’s use of the enjoined December 2025 CoC NOFO. It also barred HUD from moving forward with any further action related to the November NOFO. HUD voluntarily withdrew that NOFO and replaced it with the enjoined December NOFO, but both are still part of the legal challenge. Neither are currently operative.
- While we know that the path forward may not be easy, and that the delays Alliance members have faced are troubling, the Court’s rejection of the November NOFO and enjoined December 2025 NOFO is important. Both of those NOFOs contained provisions that fundamentally and unlawfully altered the CoC Program. The November and December NOFOs would have forced Alliance members to make incredibly difficult choices about what projects to prioritize and whether or how to compromise on key programs, as well as aspects of their organizational missions.
- Further, and most importantly for folks who are wondering what comes next, the Court ordered HUD to begin to process renewals as it would have under the terms of the original FY24-25 CoC NOFO. This means that HUD should begin to take all the steps necessary – short of obligating funds to specific CoC renewal recipients – so that if the Plaintiffs win the case, it won’t further delay funds reaching recipients. However, this could change if we do not win upon final judgment; HUD has indicated that in that scenario, it would not proceed with the FY24-25 CoC NOFO.
What Has HUD Done to Comply with the Court Order?
HUD was required to provide the Court with a report on what steps it must take to implement the part of the order that requires HUD to process renewal grants under the terms of the original FY24-25 CoC NOFO. This is called the “Implementation Plan” on the Court docket. Many stakeholders saw this document on the Court’s public docket and it raised a lot of questions. Here is where that process stands as of today.
- On December 30, HUD submitted its “Implementation Plan” to the Court. The Implementation Plan states that HUD intended to re-open the FY24-25 CoC Program NOFO and issue instructions to applicants on January 6 in order to begin processing FY25 renewal grants eligible under the original FY24-25 CoC NOFO. That deadline was extended for two additional days so that Plaintiffs’ attorneys could meet with HUD’s attorneys to discuss issues related to the Implementation Plan and timing.
- Those discussions have resulted in some changes to the information contained in the Implementation Plan. Stakeholders should rely on communications directly from HUD, not information on the court docket, as it may not be the most up-to-date information.
- On January 8, 2026, HUD sent a notice to stakeholders. This notice announced that the FY24-25 NOFO application window would be reopened on Friday, January 9, 2026, and close on Friday, February 9, 2026. It also stated that awards will be selected no later than late March 2026.
What Did the January 8 Notice Mean?
- The notice sent by HUD announces that the application window for FY25 awards opens on January 9, 2026 and closes on February 9, 2026.
- Under the terms of the FY24-25 CoC NOFO, any projects funded in FY24 and that are eligible for renewal in FY25 are not required to resubmit applications.
- Some applications and projects may need to be updated, as set forth in the notice. That should be done prior to February 9, 2026.
- We anticipate forthcoming instructions related to these projects as well as other renewals and reallocations within esnaps as HUD indicated in its notice.
- Stakeholders should monitor esnaps and communications from HUD for more details regarding the application and review process and remain aware of the February 9, 2026 deadline.
Are Documents Listed on the Court’s Docket from HUD Final? Should CoCs and Applicants Begin to Follow Those Instructions?
It is important to note that because documents submitted on the Court docket are not live documents, and they may not reflect the most recent developments. HUD is required to comply with the Court’s order. Final instructions about how to proceed will come directly from HUD – not through the docket.
Once HUD Issues Instructions for FY25 Renewals, Does That Mean the Legal Process is Over?
No, the ruling by the Court was a preliminary one. The legal process will continue to a final resolution by the Court. Our lawyers will be seeking a final resolution of the case on an expedited timeline in February and are seeking that funds be awarded following that final resolution.
As you saw in HUD’s notice, if the Court rules, at final judgment, that the cancellation of the FY24-25 NOFO and the issuance of and provisions in the enjoined December NOFO are lawful, the agency intends to revert to that NOFO instead. That NOFO is not effective right now.
But, because the agency has indicated it would like to revert to the December NOFO, our case continues to challenge its lawfulness. The Court has already found, on a preliminary basis, that the cancellation, as well as the issuance of the new NOFO (and the provisions within) are likely unlawful. If those determinations remain the same on final judgment, HUD will not be able to move forward with the enjoined December 2025 NOFO and the process will continue under the FY24-25 NOFO.
What Happens Next?
The case continues, and HUD will open the application window. They are also required to take steps to process eligible renewals, and our attorneys and HUD’s attorneys are continuing to discuss issues related to the timing and process. Any updates on the process or timing will be communicated by HUD.
Will CoC Awards Be Made Before the Judge Issues a Final Ruling?
No CoC awards will be issued until the case is resolved – that is one of the reasons why our attorneys have expedited the process to reach final judgment. For now, providers and CoCs should stay alert for official guidance from HUD.
At present, stakeholders should be aware that the new provisions within the enjoined December NOFO are not applicable to the current application and award process. The Court has paused harmful changes and required HUD to prepare for renewals under the original FY24-25 CoC NOFO, which aims to expedite the ability for HUD to make awards once there is a final judgment in the case.
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