The Bay Area is facing a potential humanitarian crisis as sweeping changes to federal housing grants threaten to destabilize thousands of vulnerable residents.

New requirements from the U.S. Department of Housing and Urban Development (HUD) will dramatically slash guaranteed funding for homeless support programs from 90% to just 30%. This radical shift could potentially leave hundreds of people without permanent housing, including veterans, youth with disabilities, and individuals managing chronic health conditions.

Michael Gause from Sonoma County’s Department of Health Services warned that “people are going to die” as a result of these cuts. His agency typically receives $4 million in HUD renewal funds, with $3.3 million traditionally supporting permanent housing for 209 individuals with significant vulnerabilities.

The new HUD policy, championed by Secretary Scott Turner, aims to “promote self-sufficiency” by reducing permanent housing support. Under these guidelines, housing programs must now focus more on employment and treatment rather than providing stable housing.

Local county leaders are deeply concerned about the potential fallout. Claire Cunningham from San Mateo County’s Human Services Agency highlighted that nearly $18 million in federal funds supporting unhoused adults and families could be at risk.

Additionally, the new guidelines introduce complex challenges for regions like California. The funding application now scores projects lower if they maintain diversity, equity, and inclusion (DEI) policies, potentially penalizing progressive housing approaches.

Christy Saxton from Contra Costa Continuum of Care emphasized the abrupt nature of these changes, noting that her county’s housing projects could impact approximately 3,000 people, including 900 previously chronically homeless individuals who had achieved stability.

As housing advocates and local government officials scramble to understand and mitigate these dramatic funding cuts, the human cost remains the most significant concern. The potential displacement of vulnerable populations could have long-lasting and devastating consequences for the Bay Area’s most marginalized communities.

The housing funding applications are due in January, with anticipated award dates in May – a timeline that could leave many housing programs in precarious financial positions.