The U.S. Department of Housing and Urban Development (“HUD”) has reissued the original FY 2024–2025 Notice of Funding Opportunity (“NOFO”) for the Continuum of Care (“CoC”) program in response to a federal court order that temporarily blocks proposed policy changes. This article explains what HUD has done, what the reinstated NOFO means for existing CoC projects, and what applicants and communities should expect while litigation remains ongoing. For additional details, refer to HUD’s CoC Program Update.

Overview

HUD has reinstated the original FY 2024–2025 CoC NOFO following a preliminary injunction that prevents the agency from implementing proposed revisions to the program. Those proposed revisions would have altered funding priorities within the CoC program, including shifting funding away from permanent housing models.

Because the court order requires HUD to maintain the status quo, the agency must administer renewal funding using the criteria contained in the original FY 2024–2025 NOFO. HUD has confirmed that projects currently funded and eligible for renewal are not required to submit a new application for FY 2025 funding unless the applicant seeks to make changes to a specific project.

HUD Funding and Application Parameters

Under the preliminary injunction, HUD is limited in how it may evaluate renewal funding. Applications eligible for another year of CoC funding must be reviewed using the standards set forth in the original FY 2024–2025 NOFO. In connection with the ongoing litigation, HUD has reopened the FY 2024–2025 NOFO and is accepting renewal submissions.

The FY 2024–2025 CoC NOFO reopened in January and is scheduled to close on February 9, 2026. HUD has stated that it anticipates selecting awards no later than late March 2026, but has also made clear that it cannot obligate funds or issue final awards while the court order remains in place. HUD has further stated that it reserves the right to issue a new NOFO if future court rulings permit the agency to proceed with revised policies.

Litigation Context and Court Oversight

The reinstatement of the FY 2024–2025 NOFO follows legal challenges brought by a coalition of nonprofit organizations and local governments opposing HUD’s proposed changes to the CoC program. In granting preliminary relief, the court required HUD to continue administering the program under the original NOFO framework while the litigation proceeds.

HUD has publicly stated that it will comply with the court’s directive reinstating the original NOFO while reserving its right to appeal and to pursue future policy changes if permitted by subsequent court orders.

Further briefing in the litigation is expected before a final ruling is issued.

Practical Impacts on CoC Providers and Communities

Although the proposed policy changes have not taken effect, uncertainty surrounding the litigation has already affected program operations. Some CoC-funded providers have reportedly paused intake for vacant units due to concerns about future funding stability.

Internal HUD estimates prepared during consideration of the proposed policy changes suggested that a substantial number of individuals could be at risk of homelessness if permanent housing funding were reduced. Rural communities, particularly those with limited state or local funding support, may be especially vulnerable to disruptions caused by prolonged uncertainty.

Considerations for Developers, Owners, and Local Governments

The reinstated NOFO and ongoing litigation raise several important considerations for stakeholders involved in CoC-funded housing:

• Track NOFO Deadlines Closely: The FY 2024–2025 NOFO closes February 9, 2026, and renewal eligibility is tied to compliance with the original NOFO criteria.
• Plan for Timing Uncertainty: While HUD anticipates selecting awards by late March 2026, HUD has also explicitly stated that it will not issue final awards and fully obligate funds while the court order remains in place, further highlighting that funding obligations remain subject to court constraints.
• Avoid Assumptions About Policy Shifts: The reinstated NOFO governs unless and until a court order allows HUD to implement revised policies.
• Coordinate with CoC Leads and Counsel: Ongoing communication is essential to manage compliance, renewal strategy, and operational risk.

Summary

HUD has reinstated the original FY 2024–2025 Continuum of Care NOFO pursuant to a federal court order blocking proposed policy changes.

Renewal-eligible projects are not required to submit new FY 2025 applications unless project changes are requested.

The NOFO closes on February 9, 2026, and HUD anticipates selecting awards by late March 2026, subject to court limitations.

Funding uncertainty has already affected some CoC operations, with rural communities facing heightened exposure.

Stakeholders should continue operating under the original NOFO framework while closely monitoring litigation developments.