Maine Attorney General Aaron Frey and Gov. Janet Mills (D) celebrated Thursday after a federal appeals court rejected the Trump Administration’s request to allow the federal government to impose new rules for the U.S. Department of Housing and Urban Development’s (HUD) Continuum of Care program.
A coalition of twenty states, including Maine, has argued that these rules would sharply limit how much of the grants can go toward permanent housing and renewals.
The complaint also alleges HUD has imposed unlawful conditions on funding eligibility, such as requiring providers to recognize only two genders, mandating that residents accept services as a precondition for housing, and penalizing localities that do not enforce strict anti-homeless laws, all of which the states contend run counter to prior HUD guidance and congressional intent.
[RELATED: Maine Sues HUD Over Changes to Homeless Support Funds, Adding to Long List of Lawsuits Against Feds]
According to Maine officials, the Continuum of Care program currently supports long-term housing for more than 1,800 people, including families, seniors, veterans, individuals with disabilities, and survivors of domestic violence.
The state said at the time of joining the challenge that more than 1,200 could lose their housing under HUD’s proposed new rules.
HUD defended the changes as reforms aimed at promoting “real success and accountability,” saying the agency stands by its decision to restructure the program.
[RELATED: HUD’s New Homelessness Policy Could Push 1,200 Mainers into the Streets, Mills Administration Warns]
U.S. District Court Judge Mary McElroy agreed with the states in December, issuing a preliminary injunction barring the rules from taking effect as the challenge proceeded.
The appeals court affirmed this decision on April 1, 2026, continuing to block the rules from being put in place, arguing that the plaintiffs had provided sufficient evidence to show that if HUD moved ahead with its changes, the results would be “immediately destabilizing and disastrous for their constituents.”
Gov. Mills responded to the ruling in a statement Thursday.
“I applaud Attorney General Frey on this critical victory, which blocks the President’s callous attempt to take housing away from more than 1,200 Maine people,” Mills said. “I will continue to stand alongside the Attorney General to fight back against the President’s abuses of power and attempts to harm Maine people.”
