LA Homeless Services Authority sues HUD over $240 million funding freeze

The Los Angeles Homeless Services Authority (LAHSA) filed a federal lawsuit to block the U.S. Department of Housing and Urban Development’s (HUD) suspension of federal homelessness grants. HUD halted the funding in June, citing alleged false statements, financial mismanagement, weak internal controls and conflicts of interest. The agency says the suspension threatens services for more than 11,000 people in Los Angeles County and seeks a temporary restraining order while the case proceeds.

U.S. District Judge David O. Carter heard arguments on Thursday and indicated a ruling could come before LAHSA’s Aug. 26 deadline to apply for regional grants. The dispute involves roughly $240 million in federal money and an $845 million LAHSA budget. Federal attorney Bill Essayli, representing HUD, criticized the absence of local elected officials at the hearing and argued that taxpayer funds cannot continue to flow into a system repeatedly flagged for failures.