(Corrects name of plaintiffs' lawyer in paragraph 9)
By Nate Raymond
(Reuters) - A federal judge in Rhode Island on Friday blocked the U.S. Department of Housing and Urban Development from requiring applicants for grants to build housing for the homeless to align themselves with U.S. President Donald Trump's positions on immigration enforcement, transgender people and other issues.
U.S. District Judge Mary McElroy in Providence issued a temporary restraining order barring HUD from dispersing $75 million
based on new criteria the administration adopted last week and prevented the grant funding from expiring as it was by law set to do on September 30 while the case is pending.
The judge said the agency acted unlawfully when last week it imposed new criteria to obtain funding and exceeded the authority delegated to it by Congress. McElroy, who has overseen other cases challenging Trump administration policies, lamented that an agency had once again created "chaos" with a rushed policy.
"I think that it's unfortunate that we're here on these things that are done so last minute by these agencies," she said during hearing held via Zoom. "But here we are again."
HUD did not immediately respond to a request for comment.
The ruling came in a lawsuit filed on Thursday by two organizations that provide homeless services, the National Alliance to End Homelessness and Women’s Development Corporation, that had urged McElroy to act quickly given a looming deadline for grant applications.
HUD published new grant application criteria on September 5 that the plaintiffs' lawyers said would block funding from flowing to service providers and communities who operate in jurisdictions with policies the Trump administration disfavors.
Those include so-called "sanctuary" jurisdictions with laws that limit cooperate with federal immigration enforcement. Applicants under the new criteria must also state that they "will not deny the sex binary in humans or promote the notion that sex is a chosen or mutable characteristic."
Kristin Bateman, a lawyer for the plaintiffs at the liberal legal group Democracy Forward, said HUD was "blackballing organizations and projects based on the policies of the states and localities that they've adopted at their local level."
The plaintiffs argued HUD lacked authority to impose those new conditions and that the criteria ran afoul of the U.S. Constitution by wrongly encroaching on Congress's power to control federal spending.
Justice Department attorney Joshua Schopf countered that HUD had broad authority to impose funding conditions and "there's nothing contrary to law here."
(Reporting by Nate Raymond in Boston; Editing by Marguerita Choy)
