A federal appeals court rejected the federal government’s request to impose harmful restrictions on grant funding that allows tens of thousands of formerly homeless people across the country to remain in stable housing.

Attorney General Kris Mayes and a multistate coalition sued the U.S. Department of Housing and Urban Development (HUD) last November after HUD abruptly changed its Continuum of Care program, the largest resource for federal homelessness assistance funding. HUD dramatically reduced the amount of grant funds that can be spent on permanent housing and put unlawful conditions on access to the funding.