April 3, 2026 – As it did last year, the administration proposes to eliminate the HOME and Community Development Block Grant programs at the Department of Housing and Urban Development. Its budget request for fiscal year 2027, released on April 3, would also cut funding for Native American and Native Hawaiian housing, defund capacity building programs including the Rural Capacity Building program, earmark all Self-Help Homeownership Opportunity funds to Habitat for Humanity, and completely revamp the federal approach to aiding people experiencing homelessness.

Join HAC on April 8 at 2:00 pm Eastern time to learn more about the budget. In this webinar, HAC policy staff will cover what the budget includes for rural housing programs at USDA, HUD, and the CDFI Fund, and what the rest of the funding process will look like. Register here.

— Information about FY27 funding for the U.S. Department of Agriculture’s rural housing programs is available here. —

Consistent with changes the administration has proposed for the FY24-26 Continuum of Care program, which have been challenged in court, the budget would direct its entire $4.02 billion in homeless funding to the Emergency Solutions Grants program and none to Continuums of Care. ESG funds, $290 million in FY26, are distributed to state and local governments. The budget proposes language to prioritize this ESG spending on transitional housing, to allow preferences for elderly people or those with disabilities, and to give HUD special flexibility in administering the program.

Native American housing funds would be reduced by one-third. Fair housing would also see a large cut: the Fair Housing Assistance Program, which funds state fair housing activities, would receive $26 million, slightly below its $26.4 million level in FY26. No funding would be provided for the Fair Housing Initiative Program, fair housing training, or assistance for people with limited English proficiency.

Public housing agencies would be required to impose work requirements for most people receiving rental assistance, and households would be limited to five years of aid.

A new $30 million program would combat fraud, waste, and abuse in federally assisted housing.

Next Steps

This budget represents the first step in a lengthier process to set appropriations for FY27. Both the House and the Senate will develop their own appropriations bills, which may or may not resemble the President’s proposal. The House and Senate should resolve any differences between their bills and send final versions to the President for signature by September 30. If they do not meet that deadline, a continuing resolution would be needed to keep the government running.

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Table: HUD Funding Levels

Program ($ in millions)	FY26 Final	FY27 Budget	FY27 House*	FY27 Senate*	FY27 Final*
CDBG	$3,300	0
HOME	1,250	0
PRICE Manuf. Hsg. Prsrv.	0	0
Self-Help Hmownrshp (SHOP)	12	16**
Veterans Home Rehab	0	0
Rural Cap’y Bldg (RCB)	7	0
Tenant-Based Rental Asst.	38,439	38,846
VASH	15	0
Project-Based Rental Asst.	18,143	17,640
Public Hsg. Capital Fund	3,200	3,200
Public Hsg. Operating Fund	5,024	5,377
202 Hsg. for Elderly	1,031	959
811 Hsg. for Disabled	287	266
Native Amer. Hsg.	1,354	887
Native Hawaiian	22.3	0
Tribal VASH	10	10
Homeless Asst. Grants total	4,417	4,024
Emergency Solutions Grants	290	4,024
Continuum of Care	4,010	0
Permanent Supportive Housing	52	0
Hsg. Oppties for Persons w/ AIDS (HOPWA)	529	0
Fair Hsg.	86.4	26
Healthy Homes & Lead Control	296	110
Hsg. Counseling	57.5	0

* These columns will be filled in as the appropriations process moves forward.

**The budget proposes $16 million to be earmarked for Habitat for Humanity’s SHOP and Section 4 technical assistance activities. Other SHOP grantees such as HAC would receive no funding.