Thanks to the hard work of advocates all over this state and country, the House and Senate Appropriations Committees have released a budget for the U.S. Department of Housing and Urban Development (HUD) that both rejects the deeply harmful cuts and policy changes proposed in the President’s Budget Request last year and greatly improves on the House budget proposed last summer. The bill provides $77.3 billion for HUD, about a $7.3 billion increase from FY25 and a $4 and $9.5 billion increase from FY26 proposals from the Senate and House respectively.

Background: Last summer both the House and Senate committees passed FY26 budget bills that underfunded housing vouchers and proposed cuts to public housing and other HUD programs, with significantly higher cuts proposed by the House. The two chambers were not able to come to an agreement before the start of the new fiscal year on October 1st, resulting in the longest government shutdown in history. A continuing resolution was passed in mid November to fund the government until January 30th.

This month, Congress has been aggressively moving spending bills ahead of the January 30th deadline to fund the government for the remainder of the fiscal year, which ends September 30th. This HUD funding bill was the result of both bipartisan and bicameral negotiations. We anticipate it will pass the House by the end of this week and the Senate next week.

Rental Assistance

Section 8 Tenant-Based Rental Assistance – The bill provides $38.4 billion for the program, an increase of $2.4 billion from FY25 and $34.9 billion for voucher renewals, a $2.8 billion increase from FY25. This is expected to be enough to fund existing vouchers.

NYHC is relieved to see full funding for Section 8 vouchers after the President proposed block granting rental assistance, which would have devastated housing markets all over the nation and neither chamber proposed a budget adequate enough to maintain current assistance levels.

Section 8 Project-Based Rental Assistance – $18.14 billion, an increase of $1.25 billion.

Housing for the Elderly (202) & Persons w/ Disabilities (811) – $1 billion for HUD 202s and $287 million for HUD 811s, increases of $100 million and $31 million respectively.

Public Housing

$5.24 billion for operating and $3.2 billion for capital, cuts of about $477 million and $210 million respectively.

NYHC is deeply disappointed to see funding cuts proposed to public housing. Increased funding for public housing operations and capital needs is desperately needed to continue serving almost 170,000 New Yorkers.

Homelessness Assistance

Continuum of Care (CoC) – the bill provides $4.01 billion for CoC grants and includes language to require HUD to renew grants expiring in the first quarter of 2026 (January-March) for 12 months. It also requires the renewal of grants that expire in Q2 if HUD fails to issue awards under a FY25 Notice of Funding Opportunity (NOFO) by April 1 and similarly in Q3 and Q4 if awards aren’t issued by July 1.

NYHC and our partners were strongly advocating for a 12 month automatic renewal for all CoC grants expiring this year. We are grateful that Congress included this fix to guarantee funding for grantees with the most urgent need and hope this will guarantee renewals for grantees with contracts expiring later in the year if the court challenge to the FY2025 NOFO continues into the spring and summer.

Housing Opportunities for People with AIDS (HOPWA) – $529 million, an increase of $24 million from FY25.

Emergency Solutions Grants – $290 million, flat funding from FY25.

Block Grants

HOME Investments Partnership – $1.25 billion, flat funding from FY25.

NYHC is happy to see HOME funding restored after the House proposed to eliminate in their previous budget proposal. It is an important tool used in every community to help finance new construction and preservation of affordable and supportive housing, fund rental assistance and provide affordable homeownership opportunities. Further, HOME is a key source of gap financing for LIHTC projects. It has been used to finance 2,459 LIHTC units in New York from just 2020-2024.

Community Development Fund – $3.3B, for the Community Development Block Grant (CDBG) flat funding from FY25.

The bill also provides $3.6 billion in congressionally directed spending that was cut in the FY25 full year continuing resolution. Commonly known as earmarks, this funding supports economic development projects as requested by the members and often includes funding for individual affordable and public housing developments.

Fair Housing Activities – The bill provides $86.4 million for fair housing programs, about a $400,000 increase from FY25. This includes $26.4 million for the fair housing assistance program and $56 million for the fair housing initiatives program.

NYHC strongly supports fully funding fair housing programs and glad to see this funding restored after both the President and the House proposed to eliminate the fair housing initiatives program in their previous proposed budgets for FY26.

Emergency Housing Vouchers

The bill includes language to allow funding for Tenant Protection Vouchers (TPVs) to be used to maintain EHVs and provides $601 million for TPVs, an increase of $264 million.

NYHC has been raising the alarm on the EHV funding cliff since last spring and we are glad to see Congress acknowledge the need to maintain this emergency program and allow PHAs some flexibility to address this issue. However, TPVS are already used to rehab public housing units with huge capital needs through RAD and PACT and we are concerned about creating a competing use for such a small but vital pot of funding.

For more details, view the updated budget chart from the National Low Income Housing Coalition.