Michigan drug recovery, worker housing in limbo after Trump funding freeze

• The freezing of some ‘green’ development grants may put two west Michigan projects on hold
• Drug recovery housing in Kalamazoo and affordable worker housing in Battle Creek are in limbo
• Environmental groups are fighting the funding freeze in court

KALAMAZOO — Two west Michigan housing projects, including one to support those in drug recovery and another for low-income workers, are endangered by funding cuts by the administration of President Donald Trump.

KalRecovery, a $22.3 million, 46-room residence for those recovering from substance use disorder, was set to break ground this fall and open in 2027. The project is now in limbo after the Environmental Protection Agency pulled funding to the Local Initiatives Support Corp., a national nonprofit, that had promised $4 million to the Kalamazoo project. The rest of the funding is lined up, said developer Matthew Hollander, senior developer for Edison Community Partners, which is involved in both stalled projects.

The projects were halted when the Trump administration froze Greenhouse Gas Reduction Fund grants that had already been awarded nationally, citing concerns over fraud and waste. Both projects were in line to receive grants to pay for on-site solar panels that would power the buildings.

Trump’s predecessor, Joe Biden, created the program and seeded it with $27 billion to help build environmentally friendly projects, particularly those that benefit disadvantaged communities.

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In March, incoming EPA administrator Lee Zeldin froze the “green bank” grants, citing a conservative journalist’s undercover video that showed a former EPA employee saying the agency was throwing “gold bars off the Titanic” — referencing the quick approval of grants before Trump took office.

“The well-documented incidents of misconduct, conflicts of interest and potential fraud raise significant concerns and pose unacceptable risk,” Zeldin said at the time.

Environmental groups have sued over the funding freeze.

Michigan communities are struggling to address a decades-long opioid crisis that kills a Michigander every four hours. The primary drug of choice currently is fentanyl, a synthetic opioid often imported from Mexico that is cheap and easily transportable. The flood of the drugs into the United States is often cited by Trump and his administration as one reason for his border crackdown.

In Michigan, advocates say the state remains woefully short of prevention, treatment and recovery services, even with an influx of hundreds of millions of dollars in opioid settlement funds from pharmaceutical companies and distributors for their role in sparking the crisis.

That shortage is particularly dire in recovery housing, where former addicts can be surrounded by support services. Such housing increases the chances for long-term sobriety.

There often are long wait-lists for recovery housing, said Harvey Hoffman, retired chief judge of 56^th District Court in Eaton County and a long-time proponent of drug courts, which supervise those with substance use disorder who have become entangled in the judicial system.

KalRecovery is meant to ease the shortage in west Michigan and is modeled after Andy’s Place in Jackson.

Kalamazoo has been particularly hard-hit by the drug epidemic. Over 29 hours in 2023, at least seven users died and more than a dozen others overdosed from a bad batch of fentanyl.

Hoffman said the fund freeze is “short sighted.” 

“How many people have to die for a policy like that,” Hoffman said. “It’s very disheartening.”

Hollander, the developer, said that “the EPA funding was the last piece of the funding puzzle and we are now scrambling to identify alternative funding sources while the lawsuits play out in court.”

Kalamazoo Mayor David Anderson said he’s frustrated, calling the project “one of the most important housing investments” in the city.

“It is absolutely important that this project can be built. I hope the EPA can follow through in their commitment for funding,” Anderson said.

The second stalled project is Project Blue Light in Battle Creek, a $38 million project to build affordable and workforce apartments on the site of a former K-Mart.

A similar funding freeze at the EPA has put that project on hold.

“I am extremely disappointed and, frankly, confused, as both of these projects have strong bipartisan support and address critical community needs,” Hollander said. “Both have been subject to extensive reviews and approvals by local, state, and federal agencies, both have strong community support, and we have nearly seven years of staff time into their development.”