Background
HUD issued a Notice of Funding Opportunity for its Continuum of Care program that set aside $1.3 billion for transitional-housing and “supportive service only” projects. The plaintiffs included homelessness and housing organizations, service providers, and local governments.
The district court granted summary judgment to the plaintiffs on their claim that HUD had to use notice-and-comment procedures before issuing the funding notice. It concluded that the set-aside was a “bonus or other incentive[]” subject to the procedures in 42 U.S.C. § 11386b(d). HUD sought a stay pending appeal.
The Court’s Holding
The First Circuit granted HUD’s motion for a stay pending appeal. Applying the stay standard in Nken v. Holder, the court held that HUD made a strong showing that it was likely to succeed in challenging the district court’s conclusion that the set-aside was a “bonus or other incentive[]” requiring notice and comment.
The court also found that HUD would suffer irreparable injury without a stay. HUD had until December 1, 2026, to make Continuum of Care awards, and the court concluded that, absent a stay, HUD could not implement the funding notice in time and funding gaps would result.
Key Takeaways
- The First Circuit stayed the district court’s summary-judgment order while HUD’s appeal proceeds.
- HUD is likely to prevail, the court said, on its argument that the $1.3 billion set-aside is not a statutory “bonus or other incentive[].”
- The approaching statutory deadline for making awards established irreparable harm because delay could create funding gaps.
Why It Matters
The order permits HUD to proceed with the challenged Continuum of Care funding notice during the appeal. It also signals the panel’s preliminary view that the statutory notice-and-comment requirement may not extend to this type of program set-aside.