The U.S. Department of Housing and Urban Development (HUD) has seen its efforts to cancel several Fair Housing Initiatives Program (FHIP) grants blocked following a lawsuit.
On Tues., March 25, Judge Richard G. Stearns in the U.S. District Court for the District of Massachusetts ruled in a lawsuit against HUD brought by the National Fair Housing Alliance (NFHA). Plaintiffs argued that canceling the grants was unlawful as the funds for the grants had been authorized by congressional appropriations.
The judge issued a temporary order—currently set to remain in effect for 14 days—mandating that HUD “restore plaintiffs to the pre-existing status quo,” meaning the restoration of funding to 78 FHIP grants issued across 33 states.
HUD had previously attempted to cancel these grants in a February 27 order. The Department is blocked from attempting to reinstate the order under a different name. Moreover, under Stearns’ order, HUD is barred from canceling any FHIP grant unless doing so is consistent with congressional appropriation or if the recipient does not abide by the terms of the grant.
After requesting an extension of time, HUD affirmed in a court filing that it had complied with the request.
In a statement following the ruling, NFHA President and CEO Lisa Rice praised the decision: “We are grateful for today’s decision granting a temporary restraining order, halting the wrongful and unlawful termination of FHIP grants to fight housing discrimination.”
Reiterating the claims of the lawsuit’s complaint, Rice said in her statement that the cuts were made at the behest of the Department of Government Efficiency (DOGE). This refers to the initiative created in January 2025 to “cut government waste” by President Donald Trump and Special Government Employee Elon Musk. DOGE has attracted significant criticism as it has laid off federal employees, gained access to sensitive databases and terminated government contracts, putting forward inconsistent explanations as to its authority or leadership.
According to the complaint, which included four individual agencies as plaintiffs (while seeking to certify a larger class), the freezing of grants caused “immediate, significant impacts” on their ability to provide services to communities, including housing-related education and counseling, as well as investigating fair housing complaints. Many of those organizations were preparing to lay off a significant number of staff themselves.
“All four organizations are left with substantial confusion and budgeting uncertainty as they try to restructure roles, cut hours, and find alternative funding sources to continue this critical work,” the complaint read.
In a post as part of its “Washington Report” advocacy updates, the National Association of REALTORS® (NAR) simply noted the decision by Stearns, with a post by Alexia Smokler, director of fair housing policy and programs at NAR, writing that the grants “have been provided for decades to fund local community efforts to educate the public about housing discrimination and investigate fair housing complaints.”
Scott Turner, current HUD secretary, said at his confirmation hearing that he intended to “take inventory” of HUD programs. Shortly after Turner’s confirmation, HUD launched a DOGE Task Force, composed of HUD employees tasked with assessing how to maximize the agency’s budget and the efficacy of current programs.
“HUD will be detailed and deliberate about every dollar spent to serve rural, tribal and urban communities. Thanks to President Trump’s leadership, we are no longer in a business-as-usual posture, and the DOGE task force will play a critical role in helping to identify and eliminate waste, fraud and abuse and ultimately better serve the American people,” said Turner in a release.
In February, HUD also moved to cut about 50% of its workforce, at the direction of DOGE. A March 13, 2025 report from the Terner Center for Housing Innovation at UC Berkeley, looking at existing and anticipated cuts to HUD staff, claimed that broad cuts to HUD and its grant programs will likely impact federally funded housing construction, as well as homebuyers seeking to qualify for loans.
