Invisapeeps 2.0

My mom's friend has a mentally disabled adult son. He was on a waiting list for a spot in an excellent residential facility, and now he's living there. At this facility, they have jobs and learn skills. They have green houses and raise plants for plant sales, and they also do some work for a large local automotive plant, such as stuffing envelopes, etc. The facility gets state funding, but also gets large amounts of private donations, plus money from its fundraising.

During its recent evaluation by the state, the state inspectors decided that they could no longer call the people living there "residents". They had to start referring to them as "people we serve".

How is "resident" some kind of insult? Resident = people who reside there! In college I lived in a residence hall. I get mail addressed to "resident".