New federal restrictions under the Trump administration could put $41 million in homelessness funding for King County and Seattle at risk — jeopardizing housing for hundreds of households across the region.

On Thursday, the Trump administration announced it would shift money away from data-backed long-term housing strategies and toward short-term programs with high barriers, such as requirements that people work, stay sober and accept mental health or addiction treatment.

That would cut funding for housing for homeless people by about two-thirds and jeopardize housing for 170,000 formerly homeless people nationwide.

Even if programs can qualify for funding under the changes, the unusually timed notice will result in monthslong funding gaps — putting people’s housing at risk in the interim, critics warn.

The policy change could severely impact Seattle and King County because they built their homeless response system around a model called “Housing First” — a philosophy rooted in evidence that shows ensuring someone is stably housed helps them find employment, reduce dependence on substances, eliminate time in jail and recover from medical issues.

The model has been criticized for years by conservatives who say people who cannot afford rent on their own should agree to certain parameters before receiving government housing assistance. The Trump administration has loudly carried that banner.

U.S. Housing and Urban Development Secretary Scott Turner said in a news release about the funding changes that such programs incentivize “never-ending government dependency.” But staff of Seattle homeless programs argue their rates of keeping people from reentering homelessness and improving their physical and behavioral health show people are more likely to solve their issues while living in stable housing — not on the street.

The new criteria run counter to well-established HUD precedent and practice, Kate Jacobs, a spokesperson for Seattle Mayor Bruce Harrell, said in a statement. The city’s Housing First programs, which she emphasized include both housing and services, provide “individuals an opportunity to address behavioral health root causes in a safe and secure environment and without preconditions,” she said.

The new funding policies “pose an immediate threat” to many of King County’s local programs, according to an Oct. 28 memo from the King County Regional Homelessness Authority, obtained by The Seattle Times.

Seattle and King County’s homelessness system receives about $65 million every year from the Continuum of Care, the program HUD uses to distribute federal funds for homelessness. The region could lose $23 million for housing that comes with social services; $13 million for subsidies up to a year to keep people who are on the brink or have recently entered homelessness in housing while they stabilize their finances; and potentially $5 million for a similar program, according to the memo.

With President Donald Trump’s rhetoric openly opposing Housing First picking up leading into his second term, King County governments and nonprofits have spent months bracing for the policy changes. But there is only so much they can do.

The local funding used to supplement federal homelessness dollars cannot support the programs that rely on the combined funding, according to the memo. Without the federal dollars, those programs can’t operate at their current scale — or at all.

Local officials plan to identify programs most likely to win funding under the new conditions and submit them for federal grants instead, so the money will stay local, just in different programs, according to the memo.

But it’s not clear how many eligible programs the region has. Additionally, The New York Times reported that an unreleased HUD notice about the change indicated applicants openly serving transgender clients or embracing policies that “facilitate racial preferences” could be rejected for funding.

“It’s very scary,” said Karen Lee, CEO of the Seattle-based nonprofit Plymouth Housing, which receives about $2 million a year in Continuum of Care funds to support two permanent supportive housing buildings for people experiencing long-term homelessness.

Recently, the King County Regional Homelessness Authority scrubbed any mention of diversity, equity and inclusion in its contract with the nonprofit, she said. The authority confirmed it updated contracts to comply with federal executive orders.

The nonprofit cannot untangle itself from its Housing First model, she said, partially because of its contractual commitments to investors who backed the projects. She worries about the future of the programs and the longevity of using local dollars to fill in the gaps.

“To try treatment first while someone is living outside — that’s proven not to be effective, and that's also cruel,” she said.

Daniel Malone, executive director of the Seattle-based nonprofit Downtown Emergency Service Center, said he remembers a time when Seattle more closely followed the homelessness system the Trump administration described.

“We saw how terribly it failed over and over and over again, where you effectively just had a system … where the people that got help were in a position to overcome the problems they were having, and they needed support the least,” Malone said.

His organization stands to lose about $20 million, or a quarter of its permanent supportive housing fund.

“We certainly shouldn't be taking money away from this part that is most effective,” he said. “If you want to create more of the other kinds of options, let's come together and produce more funding for them.”

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