President Donald Trump’s one-day freeze on federal spending in January unleashed chaos across agencies that rely on government funding. Though that impact was temporary, deep staffing cuts could mean new financial uncertainty for San Francisco’s homeless programs.
According to a budget document obtained by The Standard, roughly half of all employees at the U.S. Department of Housing and Urban Development are set to be fired in the next three months. If no one is left to conduct in-person program visits and process payments, those staff cuts could stall tens of millions in grant funding from reaching San Francisco’s homeless service providers, according to several sources in the agency.
HUD has more than 100 active grants with San Francisco government agencies worth about $326 million, according to federal spending data. About $115 million of that comes from HUD’s Community Planning and Development office. That division, which in December announced a $56 million grant to San Francisco for homeless services, would see its staff reduced by 84%. If those cuts are made proportionally in the local office, just five staffers would remain to manage more than a hundred grants across Northern California.
“We would not be able to administer the funds to the city of San Francisco or any of our other grantees,” said a HUD employee with knowledge of the cuts and spending impacts who wished to remain anonymous for fear of retaliation. “There will be no one left to run the programs.”
The Community Planning and Development unit does far more than sign off on checks. Agency staff oversee the hundreds of millions of dollars they disburse to communities. Most of the grants are reimbursed monthly, and federal workers must regularly comb through each grantee’s budget, perform in-person verification visits, and field questions about spending.
A skeleton crew left to handle the more than 119 grantees in Northern California would serve as a choke point for those funds. San Francisco is one of the nation’s largest recipients of HUD homeless funds, so it will especially feel the pain.
‘There’s a snowball effect. In the end, the person that gets harmed the most is the low-income individual.’
HUD staffer
“They are gonna basically get shut down,” another HUD staffer who wished to remain anonymous said of most grant-funded homeless programs. “There’s a snowball effect. In the end, the person that gets harmed the most is the low-income individual.”
In December, San Francisco’s Department of Homelessness and Supportive Housing was awarded $56 million from HUD’s Continuum of Care grant program. The 34 funded projects include $620,000 for Glidelide’s Cecil Williams Community House, $2 million in rental assistance for homeless veterans, and nearly $600,000 for a homeless youth program.
“We have not yet received the announced award funds from HUD and have not received any official notification that these grants will be cancelled or reduced,”a Homelessness Department spokesperson said.
In all, the city agency receives more than $69 million, 8.2% of its annual budget, from the federal government, almost all of it from HUD.
It’s an especially bad time for San Francisco’s Homelessness Department to face budget uncertainty. In a keystone campaign commitment, Mayor Daniel Lurie made an ambitious goal to ramp up shelter in the city. That job has already been complicated by the scheduled closure of one major shelter. Making matters worse, city leaders are struggling to close a mounting budget deficit. Layoffs are on the table.
HUD’s Community Planning and Development office is tasked with housing the homeless and providing housing for low- and middle-income residents through its HOME Investment Partnerships Program. The office also helps underserved areas and spearheads disaster recovery in places where Federal Emergency Management Agency funding is outstripped, including the fire-ravaged town of Paradise, which received funds from the office’s Community Development Block Grant program.
HUD did not respond to a request for comment on its planned cuts. But in contrast to the heads of some other gutted agencies, HUD Secretary Scott Turner has embraced Elon Musk’s Department of Government Efficiency and its deep and potentially unconstitutional cuts.
Turner last week launched what he dubbed a DOGE Task Force to root out waste and fraud at HUD. Agency leadership emailed employees Tuesday to ask for their participation. “The HUD DOGE team welcomes your help and ideas in uncovering fraud, waste, and abuse at HUD,” it read.
“In just one week our DOGE Taskforce has uncovered $1.9 billion in ‘misplaced’ funds and started trimming the fat on $260 million in wasteful contracts,” Turner tweeted Wednesday. “And we’re just getting started.”