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Illinois groups scrambling after termination of federal grants for mental health, substance use disorders

January 14, 2026 by Chicago Tribune

Providers of mental health and substance use disorder services in Illinois and across the country were scrambling Wednesday, after learning that the federal government was terminating their grants, effective immediately.

Illinois nonprofit organizations reported receiving letters Tuesday night and Wednesday morning from the federal Substance Abuse and Mental Health Services Administration saying their funding was terminated as of Jan. 13

Letters reviewed by the Chicago Tribune said that the administration was “terminating some of its awards, in order to better prioritize agency resources” toward promotion of “innovative programs and interventions that address the rising rates of mental illness and substance abuse conditions, overdose, and suicide and their connections to chronic diseases, homelessness and other challenges our Nation’s communities face.”

Neither the administration nor the U.S. Department of Health and Human Services responded to requests for comment Wednesday afternoon.

It wasn’t immediately clear Wednesday how much money was being lost in Illinois — but nonprofits and the state say it’s at least in the millions of dollars. They say the cuts could mean fewer services in Illinois for people struggling with homelessness, substance use disorders and fewer prevention and training programs related to mental health.

The Illinois Department of Human Services’ Division of Behavioral Health & Recovery said in an email to providers Wednesday — that was obtained by the Tribune — that the termination of two of its grants “could result in a loss of up to $2.5 million in federal dollars each year supporting substance use and overdose prevention efforts in Illinois.”

Nationally, nearly $2 billion in grants across the country could be affected, estimated Jonah Cunningham, president and CEO of the National Association of County Behavioral Health and Developmental Disability Directors.

The canceled grants seem to be for a variety of programs, including workforce development, homeless diversion, jail diversion, substance use disorder treatment and youth suicide prevention initiatives, Cunningham said.

“It pulls the rug out from a field that, after so many years, has started making (headway),” Cunningham said, pointing to lower rates of opioid overdose deaths, among other successes. The move “undercuts investments that have been made by both Democratic and Republican administrations,” he said.

Leaders of organizations in Illinois that run programs with the grant money expressed shock Wednesday at the cuts.

Haymarket Center, which serves people with substance use disorders in Illinois, received letters Wednesday morning saying that all three of its federal grants, worth about $1.8 million a year, were being terminated immediately, said CEO and President Dr. Dan Lustig.

One of those grants went toward a program that helped people who are homeless receive substance abuse treatment, job training and employment. A second grant was for treatment and housing for people who are homeless with mental health and substance use disorders. A third grant focused on people who are homeless with substance use disorders and conditions such as hepatitis B and hepatitis C, he said.

“In the substance use disorder field, grants are what we live by … so when you look at a grant that’s cut, you’re looking at services that are being cut,” Lustig said. “People will die because of these cuts.”

Other Illinois providers said their grants for training and prevention programs were being axed.

Josselyn, a nonprofit community mental health center with locations in the north suburbs, learned Wednesday morning that it was losing its annual $125,000 grant, said Susan Resko, CEO and president.

Josselyn used that grant to go into schools to train teachers, staff and teens on how to recognize signs of a mental health crisis and how to respond, Resko said. The organization has offered the program in dozens of Illinois schools, at no cost to the schools, Resko said.

“When you consider that 1 in 5 teens have a diagnosed mental health condition, how this doesn’t align with the MAHA (Make American Healthy Again) priorities is a head scratcher, because the first thing that the MAHA movement says is they want to address chronic conditions in children,” Resko said.

Similarly, Trilogy, which supports people with mental illnesses, found out that it was losing a grant worth about $120,000 a year that now goes toward training groups of people in Illinois on how to recognize when a person needs mental health care and what to do about it, said Susan Doig, CEO at Trilogy. The training is for groups such as grocery store workers, library staff and city employees, among others.

“Something like this hurts, and it hurts the community and the public,” Doig said. “People are really interested in knowing how do they help people who are in crisis. … When we wait too long to intervene or to do something, people suffer, they often get worse. … It’s prevention.”

Leaders of the organizations said they’re now trying to figure out how to make do without the funding and what might need to change about their programs. In the Illinois Department of Human Services letter to providers Wednesday, Division of Behavioral Health & Recovery Director David Albert wrote that the division was working to mitigate the effects of the cuts.

“We are also exploring all other appropriate action, including legal action,” Albert wrote.

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