The Trump administration recently announced a major shift to the scoring rubric for the federal government’s main source of homeless aid—the Continuum of Care program—which annually distributes $3.9 billion in competitive funding to local communities. The new rubric will target funds to recovery-oriented, time-limited housing programs, a reversal of a decades-long emphasis on no-strings-attached permanent housing assistance.

The reforms reflect a focus on recovery over unconditional aid and on restoring public order, worthy objectives previously set forth by President Trump’s July 2025 executive order on homelessness. At the same time, the magnitude and speed of the reforms—the newly released funding applications are due in January and apply to next year’s funding allocation—have sparked concerns that existing recipients of homeless assistance could be destabilized or even pushed back into life on the streets.

The fundamental problem is that the federal government has for years insisted on an overly prescriptive approach to homelessness, discouraging innovation and alignment with local values—and as we are now seeing—subjecting aid for the homeless to changing political winds in Washington. The potential disruption arising from the new rubric, which despite its merits ultimately imposes a different set of centrally determined priorities, demonstrates the risks of federal overreach. The most durable solution is for Congress to grant communities long-lasting flexibility to craft their own responses to homelessness.

Prior to the Trump administration’s changes, the most controversial aspect of the scoring rubric under the Biden administration was its commitment to Housing First, listed second only to “ending homelessness for all persons” in its priorities for awarding funding. Housing First is an approach that prohibits requirements for program recipients, making engagement with substance abuse and mental health treatment, job training, and other services optional. A community that sought to reallocate funding to housing or shelter programs that utilize these types of requirements would put federal funding at risk.

In another case of federal overreach, the Biden administration’s rubric states: “Applicants must indicate their [community’s] specific strategies to…minimize use of law enforcement to enforce bans on public sleeping,” among other steps to “prevent the criminalization of homelessness.” The federal government should not dictate the public safety response of local communities, particularly when doing so could ultimately exacerbate unsheltered homelessness.

The biggest problem though with the Biden administration’s scoring rubric is not the prescribed policy approaches themselves, but rather, the fact that it makes specific prescriptions in the first place. Homelessness is a complicated problem, experienced by individuals with needs ranging from temporary financial assistance in order to keep their apartment to intensive treatment for mental illness.

That does not mean we know nothing about successful interventions, thanks to a growing body of rigorous research: Modest one-time payments can prevent homelessness for families facing eviction. Short-term rental subsidies are a relatively cost-effective approach to house homeless families, although they may do less to promote self-sufficiency than service-intensive transitional housing programs. Permanent supportive housing tends to keep people out of homelessness but is not particularly effective at addressing the underlying problems faced by the most vulnerable.

But just the opposite of supporting a top-down approach, the evidence we have supports local decision-making over how to allocate homeless aid. Communities vary widely in the populations who experience homelessness: In Los Angeles, two thirds are adults living on the streets, whereas in the state of Massachusetts over three-fourths are families living in shelters, according to the latest point-in-time homeless count data as of January 2024. Communities vary in other ways as well, with different housing markets, mental health resources, mainstream supports, and cultural values. What works best will vary drastically across communities, in ways that communities themselves are best able to discern.

There are also major holes in the existing evidence base, such as the impact of clearing encampments on the unsheltered homeless population and the types of service-intensive programs that most improve individual outcomes. New interventions, or old ones implemented more effectively, may ultimately perform better than established practices. Overly prescriptive federal priorities discourage local innovation and reduce the long-run effectiveness of homeless aid.

The Biden administration weakened the nation’s response to homelessness by rejecting local autonomy, but so too does the Trump administration’s scoring rubric. The service-intensive transitional housing programs preferred by the new scoring rubric could ultimately be more successful in improving individual outcomes, but in some communities temporary rental subsidies may be more cost-effective. The shift away from permanent supportive housing may free up resources to serve more individuals, but some current residents may need those longer-term programs.

The abrupt nature of the shift complicates matters, since it takes time and planning to design effective programs, especially at the scale required by the reform. There are also real concerns over the risk of displacement of individuals currently living in permanent supportive housing programs that lose funding.

But even though the ideal response would have been for the Trump administration to grant communities local autonomy over their response to homelessness, in effect that may not have been possible. If the administration had rewritten the scoring rubric to provide maximum local autonomy under the law, communities would have likely hesitated to make major reforms, knowing that a future Democratic administration was likely to reimpose Housing First and related priorities. Major programmatic changes take time and incur significant transition costs, so aligning with anticipated future federal priorities would be the safest path.

In this sense, the Trump administration could have felt it had only two real choices: either allow the top-down, Housing First status quo to continue indefinitely, or make a disruptive change that required immediate action from communities. For better or worse, it chose the latter.

Fortunately, there is a way out of the disruptive path that we are headed down, in which every time the political party of the President changes, communities are forced to dramatically shift their homeless aid programs.

Congress should take away the power of the Department of Housing and Urban Development to micromanage the homeless responses of communities. They should reform the Continuum of Care program so that funding to communities is tied to only basic requirements such as data reporting, community level coordination of resources, and effective and fair local governance of programs receiving federal funds. Local reforms could be undertaken deliberately over time, rather than suddenly without adequate planning.

This would be a more constructive path for Congress to take than heeding calls by advocates to override the Trump administration’s reforms and freeze the Biden era scoring rubric in place. Ignoring local differences and stifling innovation is in nobody’s interest. The Trump administration was right to seek major change to the system, but only Congress can deliver it in a way that avoids major disruption to people’s lives, and locks in the benefits of local control for the long term.