By New York Post (U.S.) | Created at 2026-08-06 18:06:03 | Updated at 2026-08-06 19:50:34
1 hour ago
Los Angeles’ under-fire homeless authority launched a desperate attempt in court Thursday to stop the federal government’s suspension of $240 million in federal money for the agency.
The US Department of Housing and Urban Development (HUD) had announced in June that it was immediately suspending more than $200 million in federal funding to the Los Angeles Homeless Services Authority (LAHSA) while it investigates fraud, mismanagement, and waste.
The Trump administration essentially striped LAHSA of its authority to oversee the region’s federal Continuum of Care funding, which pays for permanent supportive housing, street outreach and other homelessness programs.
LA received about $240 million through the program last year, the largest Continuum of Care grant awarded anywhere in the nation.
Federal officials alleged LAHSA failed to verify nearly 2,300 housing sites, could not determine whether taxpayer money paid for empty motel rooms for the homeless, made false conflict-of-interest certifications, and lacked basic financial safeguards.
HUD also cited the resignation of LAHSA’s former CEO after she approved more than $2 million in federal funding for her husband’s employer.
“Under President Trump’s leadership, HUD will fund results, not corrupt failure or the homeless industrial complex,” HUD Secretary Scott Turner said when announcing the suspension of funds.
In the latest court filings, LAHSA argued the allegations of fraud and fiscal mismanagement are essentially false, saying “it is not supported by adequate evidence.” The agency’s attorneys said the suspension is politically motivated and not truly tied to an investigation.
“In other words, HUD asked its [investigators] to investigate LAHSA, and then waited less than two weeks to suspend it. HUD’s sidelining of LAHSA has nothing to do with pending investigations and nonfinal factfinding,” attorneys wrote.
The homeless agency framed the citation of past misconduct as “stale information” that’s too old to be used. Attorneys say it’s questionable why last year HUD did not commence an investigation when the same concerns around fiscal management surfaced, noting that the agency was awarded a grant as recently as May 2026.
The citation of past concerns is misleading, lawyers said, because it does not reflect corrective actions the agency took.
“HUD gives short shrift to the fact that LAHSA has made significant and comprehensive improvements over at least the last ten years, such that old audits are not reflective of its current state,” the attorneys wrote.
The feds also made allegations well of false certifications, but the agency insisted there was no evidence.
The agency also disputed the feds’ characterization of past audits that brought up concerns, pointing to other parts of those audits that state it did not “identify any instance where LAHSA failed to comply with federal laws or contractual obligations.”
Finally, LAHSA claims the suspension authority is actually not permissible under federal law.
The court battle comes as HUD’s application deadline is Aug. 26. By then, LAHSA, or an alternative applicant, would submit its final application to the federal government.
