HUD Sends Letter to PHA Executive Directors Advising Careful Management of Voucher Program

By: Tushar Gurjal, Senior Policy Manager

May 23, 2025 — On May 20, HUD sent a letter to PHA Executive Directors advising them to carefully consider their Housing Choice Voucher (HCV) Program budget for 2025. The letter states that while housing agencies are receiving full funding of their renewal funding eligibility, HUD remains concerned that “a sizeable number [of PHAs] may experience HCV funding shortfalls this year.” The letter also notes that “HUD has very limited funds to address the HCV shortfalls in 2025, and PHAs should not operate their programs under an assumption that such funds will be available.”

The Department urges housing agencies to carefully review the funding they have received and their projected HCV program costs for this year. The letter also encourages PHAs to make use of the Two-Year Tool and the Payment Standard Tool. After analysis, if an agency believes that its costs could exceed its expected renewal funding plus reserves, it should take “immediate steps to mitigate this risk.” Additionally, the agency should contact its local HUD field office or reach out to HUD’s Shortfall Prevention Team.

If, after analysis, an agency does not believe that it is at risk of shortfall, HUD still recommends reviewing “program parameters to ensure that funds are being used efficiently.” In this case, the Department recommends reviewing payment standards and ensuring that rents paid are reasonable.

The full letter can be found here.