HUD Releases FY 2027 Budget Proposal: Insufficient Rental Assistance Increases Paired with Devasting Cuts to Community Development Programs

April 3, 2026 — This morning, the Trump Administration released its FY 2027 HUD budget (starts on page 563) proposal. Although the president’s budget is a political document and does not have the force of law, it does begin the appropriations process. The President’s FY27 budget proposal (starts on page 35) includes insufficient increases to rental assistance programs and devastating cuts to community development programs. It would cut $10.7 billion from the FY 2026 HUD budget, representing a 12.7% reduction. Unlike FY 2026, the Administration is not proposing to block granting federal rental assistance to the states. See NAHRO’s FY 2027 funding recommendations here.

The budget proposal includes $35.565 billion to the Housing Choice Voucher (HCV) Housing Assistance Payment (HAP) renewal account, a $608 million increase from FY 2026. Based on NAHRO’s early estimations, this would not provide enough funding to fully cover all existing HAP contracts. Further, the budget proposal includes language prohibiting both non-MTW and MTW agencies from issuing new vouchers to assist new families (except for new HUD-VASH vouchers, Family Unification Program or Foster Youth to Independence program vouchers, or new Rental Assistance Demonstration (RAD) PBVs). The budget also proposes $2.951 billion for HCV Administrative Fees, $115 million more than FY 2026. The budget does not appear to include funding for Emergency Housing Vouchers (EHVs).

The Administration is proposing $17.64 billion for the Section 8 Project-Based Rental Assistance (PBRA) program, a $90 million decrease from FY 2026. The budget also proposes $529 million for Performance-Based Contractor Administrators (PBCAs).

The budget proposes $5.377 billion for the Public Housing Operating Fund, a $690 million increase over FY 2026; and $3.2 billion for the Capital Fund, maintaining level funding. While the proposal includes a modest increase to the Operating Fund and the Capital Fund remains unchanged, these amounts fall short of meeting the full cost of daily operations under the Operating Fund formula and are insufficient to address agencies’ capital needs in 2027. The budget also proposes language that would require PHAs to implement work requirements for all federal rental assistance programs, applicable to residents aged 18 – 62, with exceptions for disabled individuals; veterans undergoing mental health, treatment, substance abuse, rehabilitation, or recovery programs; students; and certain individuals that are not subject to work requirements under SNAP and Medicaid. The proposed budget also includes language that would place a 60-month (5 year) time limit on receiving housing assistance for similar households.

The budget also proposes eliminating funding for all HUD self-sufficiency programs, including the Family Self Sufficiency (FSS), Jobs Plus, and ROSS programs. Harmful on its own, this would be especially troubling if proposed work requirements and time limits went into effect.

The budget proposes devastating cuts to Community Development programs, including eliminating the Community Development Block Grant (CDBG) program, HOME Investment Partnerships Program, the Choice Neighborhoods Initiative, and the Housing Opportunities for Persons with AIDS (HOPWA) program. The budget also proposes eliminating Housing Assistance Grants programs, including the Continuum of Care program, and instead providing $4 billion to fund Emergency Solutions Grants solely.

Lastly, the budget proposes $30 million to combat “fraud, waste, and abuse” in federal housing programs. The funding would go toward additional financial reporting and oversight for HUD assistance recipients, aiming to prevent improper payments and ensure funds are used appropriately. NAHRO recently testified before Congress to inform lawmakers about how PHAs serve their communities well as responsible stewards of taxpayer dollars and that HUD data show that federal rental assistance programs operate with high degrees of accuracy and accountability.

Budget Summary

• Public Housing Operating Fund: $5.377 billion
• Public Housing Capital Fund: $3.2 billion
• HCV HAP Renewals: $35.565 billion (the budget does not appear to provide any additional funding for households participating in the Emergency Housing Voucher (EHV) program)
• HCV Administrative Fees: $2.951 billion
• Tenant Protection Vouchers (TPVs): $300 million
• Family Unification Program / Foster Youth to Independence Program: $30 million
• Section 8 PBRA: $17.64 billion
• Section PBRA Performance Based Contract Administrators (PBCAs): $529 million
• CDBG: $0
• HOME: $0
• Homeless Assistance Grants: $0
• Emergency Solutions Grants: $4 billion
• FSS: $0
• Jobs Plus: $0
• ROSS: $0

Next Steps

NAHRO staff will continue reviewing the President’s FY 2027 budget proposal and will share a more detailed analysis next week. Keep in mind that the President’s budget is a policy proposal — not law — and serves as the starting point for the FY 2027 appropriations process. In the months ahead, the House and Senate will develop their own appropriations bills. Now is the time to contact your members of Congress and urge them to fully fund housing and community development programs for FY 2027!