Housing for thousands in SC in jeopardy as Trump’s orders sow confusion in HUD funding
Chaos in federal funding has created uncertainty among some South Carolina nonprofits that provide rental assistance about whether they will be able to keep thousands of families housed.
Roughly 8,700 families in South Carolina, consisting of more than 11,000 people, benefit from grants administered through an initiative from the U.S. Housing and Urban Development Department designed to end homelessness.
In 2024, nonprofits in South Carolina were awarded $20,552,409 by the federal agency as part of the Continuum of Care program, which provides broad support including rental assistance and funding for social services designed to keep individuals and families in stable housing.
But now that funding may be in jeopardy as nonprofits say that HUD has suddenly and with little communication pulled agreements to provide funds that organizations have been awarded through a grant process. That means some nonprofits have had to tell both the people they serve as well as landlords not to count on rent payments come April 1.
“There are huge ripple effects when these programs are halted,” said Stacey Denaux, president of One80 Place, a South Carolina-based nonprofit that supports a range of services aimed at providing housing.
The money not coming in on April 1 will immediately impact 46 households in Charleston consisting of 83 people for which One80 provides rental assistance, Denaux said. More people will be impacted as 2024’s grants continue to expire throughout this year, Denaux said.
Many organizations have already spent down their previous grants paying rents and providing other assistance.
While no Continuum of Care grants in the Midlands expire this month, grants in the region will expire by June, said Jennifer Moore, vice president of community impact for the United Way of the Midlands.
“It will be difficult for any entity, no matter their financial strength, to pay monthly rents without reimbursement for any length of time,” Moore said.
A HUD representative said that funding was not being cut to South Carolina but did not respond to a list of follow-up questions regarding the disruption of the Continuum of Care grants.
Homeless services in South Carolina are particularly vulnerable to instability and suspensions in federal funding because no dollars flow from the state General Assembly, Denaux said. While organizations raise funds, it’s not enough to make up for the millions awarded by competitive federal grants.
In an interview with Shelterforce, a publication that covers affordable housing, Shamus Roller, executive director of the National Housing Law Project, warned, “My real worry is that very soon we’ll start to see homeless service agencies that go belly up, and there will be formerly homeless people that are served by these programs who are getting forced back onto the streets.”
What happened?
The uncertainty began almost as soon as President Donald Trump took office. On Jan. 27, a memo from the federal Office of Management and Budget called for the temporary suspension of “all activities related to…disbursement of all Federal financial assistance.”
But just two days later, the office released a memo rescinding the earlier order. That was the “first wave of panic,” said Denaux.
And then on March 13, the second wave hit. HUD sent One80 a new agreement that needed to be signed in order for the group to receive its grant. This altered agreement contained what Denaux described as “anti-DEI” language.
“It was very disturbing language, but at that point what do you have?” said Denaux.
However, at 4:30 p.m. the next day, the organization received a phone call saying that the new agreement was being rescinded. In an email reviewed by the state, HUD told agencies receiving agreements with the revised language for continuum of care grants that “If you have not yet signed the agreement, we ask that you refrain from signing that version of the agreement. If you have already signed the agreement, HUD is unable to provide funding pursuant to this agreement as it is not consistent with applicable Court Orders and it must be deemed inoperative.”
HUD was working to revise its grant agreements “to be consistent with Federal law and compliant with applicable Court Orders,” according to the email.
While her group was initially relieved, Denaux said that two weeks later it has not heard anything further from HUD.
As of Thursday, March 27, Denaux said that her organization still had not received updated agreements for their grants to provide rental assistance.
“I don’t believe this is an issue of HUD staffers being unresponsive… I know this hurts them to their core,” Denaux said.
Rates of homelessness continue to rise
Homelessness has emerged as a significant issue in Columbia.
“We’ve had a real increase in homelessness, increasing rapidly in the last four years,” Columbia Mayor Daniel Rickenmann told TV Station WLTX in June 2024.
According to the state’s Interagency Council on Homelessness report for 2024, the number of unhoused people outside in South Carolina counted on a single night rose 11% from 2022 to 2023, the most recent year for which data is available.
The population of children enrolled in South Carolina schools living without stable housing also climbed from 11,970 in 2022 to 13,770 in 2023, a 13% increase.
And while landlords are rarely part of conversations when it comes to funding for homeless services, corporate landlords typically do not rent to people receiving rental assistance, Denaux said.
Those who accept tenants receiving rental assistance “are people who own a duplex or are a small property manager… these are mom and pop operations,” Denaux said.