C.H.U.D.

The film opens with a woman walking her dog down an empty, darkened city street. As she passes by a manhole, she is attacked by a creature, and the dog is pulled in after her.
George Cooper (John Heard) lives with his girlfriend Lauren (Kim Greist). George, a once-prominent fashion photographer, has since forgone the fame and fortune. His current project is photographing New York City's homeless population, specifically those known as "undergrounders", or people who reside within the bowels of the city.
A police captain named Bosch (Christopher Curry) is introduced. Bosch has a personal interest in the recent flood of missing persons (most of whom are homeless) being reported to his precinct. Bosch interviews A.J. "The Reverend" Shepherd (Daniel Stern), who runs the local homeless shelter. Shepherd believes recent events to be a part of a massive government cover-up and has the evidence to prove it. Bosch's superiors know more than they are letting on and seem to be taking their cues from an overly glib, weasely type named Wilson (George Martin), who works for the Nuclear Regulatory Commission.
It turns out there are monsters lurking beneath the streets; beings that were once human, but have been mutated by radioactive, chemical toxic waste into hideous, flesh-eating creatures that prey on the homeless who live in the underground. Given the recent drop in the underground transient population, the creatures have resorted to coming to the surface through sewer manholes in order to feed. Through a series of events, both George and A.J. find themselves trapped in the sewers, a reporter gets involved (and eaten), and Lauren has a problem with both a clogged shower drain and an unexpected visitor that comes up through the sewer access point that she unfortunately decides to open in the basement of her apartment building. Then, through the dangerous investigative efforts of both A.J. and George, the absolute horror is revealed: The Nuclear Regulatory Commission is directly involved in the slaughter that has been going on.
Although the political bureaucracy has forbidden the NRC to transport the toxic wastes through New York because of the large-scale danger to the public, it has secretly been hiding the waste by-products (marked as "Contamination Hazard Urban Disposal") beneath Manhattan in abandoned subway tunnels. Unfortunately, the underground homeless population has been coming into contact with these by-products, turning them into the mutated creatures. It is this secret that Wilson guards to the extent of having a mysterious and threatening lackey disrupt A.J. from making phone calls to the press. This thug then locks A.J. in an underground access tunnel either to suffocate from the gas to be used to asphyxiate the C.H.U.D.s, or to leave him to become their prey. Wilson is clearly willing to kill to protect his employer's secretsâeven a cop. Later that evening at a diner, two police officers enter and while the waitress and the two are discussing, the monsters return and attack the diner inhabitants.
Captain Bosch argues with Wilson over how to deal with the threat: Wilson wants to seal the sewers, open up some gas lines, and asphyxiate the C.H.U.D.s despite the inherent danger to the city.
Wilson, after being overwhelmed by Bosch (it is implied in dialogue that Bosch's wife was the woman taken by the C.H.U.D. at the beginning of the movie) shoots him and drives the truck in reverse aiming for George and AJ, but they escape from the manhole just in time as Wilson pass them over. AJ finds Bosch's gun and shoots and kills Wilson before he runs over them, then the truck explodes as it falls on the manhole, Bosch is still alive and George, Lauren, and AJ are saved.

Question: Who is turning into mutated creatures?
Answer: Homeless.