A closer look at how proposed eliminations and policy changes could reshape affordable and supportive housing efforts nationwide.
Last week, the White House released its Fiscal Year 2027 (FY27) budget proposal, outlining significant funding and policy changes across federal housing and homelessness programs. The budget requests $73.5 billion in discretionary funding for HUD in FY27, a substantial increase from the $43.5 billion requested last year. However, despite this overall increase, the proposal would eliminate or significantly reduce funding for core housing programs that support the development and ongoing operation of affordable and supportive housing.
The budget proposal would eliminate funding for several longstanding programs, including:
- Continuum of Care (CoC) Program,
- Youth Homelessness Demonstration Program (YHDP)
- Housing Opportunities for Persons with AIDS (HOPWA)
- Family Self Sufficiency (FSS) Program
- HOME Investment Partnerships Program
- Community Development Block Grants (CDBG)
- Department of Justice’s Second Chance Act Pay for Success Program
In addition, the proposal would significantly reduce funding for other critical housing and community development resources, including:
- Tenant Based Rental Assistance
- Section 202 Housing for the Elderly
- Section 811 Housing for Persons with Disabilities
- Homeless Assistance Grants
- Community Development Financial Institutions (CDFI) Funds
The budget also seeks to make changes that closely resemble the Administration’s attempt to structurally change the CoC program through the FY25 Notice of Funding Opportunity. This is despite the fact that the NOFO remains under litigation and that Congress required HUD to renew existing CoC grants in the FY26 appropriations bill enacted earlier this year.
The proposed budget would authorize HUD to set aside statutory requirements and allocate homelessness funding through a framework defined by HUD rather than existing law. This approach would place greater emphasis on transitional housing and participation in substance use or mental health treatment as a condition of accessing housing.
If enacted, the proposal would undercut decades of bipartisan federal investment and private sector capital dedicated to the development of supportive housing, rental assistance for people with disabilities, and the services that help people remain stably housed. These programs are proven, cost-effective solutions that improve health outcomes and housing stability across rural, urban, and suburban communities alike.
Historically, Congress has recognized the importance of sustained investment in these programs, and we urge lawmakers to continue that bipartisan tradition in the FY27 appropriations process by fully funding proven interventions and ensuring that policy changes of this magnitude receive appropriate congressional consideration.
We are currently accepting organizational sign-ons to our FY27 letter to Congress through April 9 and invite partners to join us in calling on Congress to continue its bipartisan support for housing stability, supportive services, and housing development. Both the House and Senate are expected to release their own budgets in the coming weeks, and together, we can reinforce the importance of these programs and ensure they continue to deliver stable housing outcomes nationwide.
