The city of Lima and the surrounding Allen County area are bracing for a significant blow to local efforts aimed at tackling homelessness. A major overhaul of the federal government’s primary homeless assistance program has resulted in a sharp reduction of funding for key regional services, sparking concern among local advocates.
The Department of Housing and Urban Development, or HUD, has issued changes to its Continuum of Care (CoC) grant program, which is the largest source of federal funding for homeless services. This policy shift represents a move away from the long-standing “Housing First” approach—a model that prioritizes placing people in stable housing immediately and offering services like addiction treatment and mental health care as a voluntary option.
The new direction, championed by the administration, instead prioritizes transitional housing programs that require participants to seek treatment for addiction or mental health disorders in order to qualify for housing assistance. Officials have framed the move as a way to end what they call a “failed housing-first ideology” and redefine success by an individual’s path to “long-term self-sufficiency and recovery.”
However, the new funding formula dramatically caps the portion of the grant that can go toward permanent supportive housing—a key element of “Housing First”—at just 30 percent of an allocation, a massive change from the previous 85 to 90 percent.
For the Lima area, the impact is already being quantified. The West Ohio Community Action Partnership, or WOCAP, which manages many of the area’s homeless prevention programs, anticipates a funding cut of $180,000 over the next two years. WOCAP’s Housing Director, Leora Donley, noted that this reduction will force the agency to drastically scale back its rapid rehousing and prevention efforts. The agency will now only have enough funding to assist 20 households over the next two years, a significant drop from the 45 households it assisted with past-due rent and eviction prevention in the two years prior.
“Our models have always worked on the housing-first premise,” Donley explained. “The idea is that having stable housing then gives somebody the ability to start working on their other issues.” Local advocates worry that making housing conditional on mandatory treatment could effectively “criminalize homelessness” and create new barriers for people who desperately need a safe place to live.
The local cut reflects a massive statewide reduction. Advocacy groups like the Ohio Coalition on Homelessness and Housing estimate the policy change will divert a staggering $80 million from Ohio programs that are currently housing formerly homeless residents. They warn this sudden reversal could send as many as 10,000 Ohio households back into homelessness. This comes at a time when the state has seen a relatively lower increase in homelessness (3% in 2024) compared to the national average (18.1%), a success many attribute to the effective “Housing First” policies already in place.
In a community like Lima, where approximately 60 individuals were counted as experiencing homelessness during the 2023 Point-in-Time count, the loss of these funds is not an abstract political debate. It means fewer families will receive emergency lodging, and fewer individuals will get the rental assistance needed to stabilize their lives amid rising housing costs. The agencies on the ground now face the difficult task of retooling their services to fit the new federal mandate while simultaneously addressing a persistent and pressing community crisis.
