Shutdown Watch 2026

January 29, 2026 — As Senate Democrats negotiate a short-term funding agreement on Department of Homeland Security funding following fatal shootings in Minneapolis, Congress appears to be heading for a partial government shutdown this weekend. Current continuing resolution (CR) funding is set to expire on Friday, January 30 as part of agreement that ended the 43-day government shutdown at the end of 2025. Senate Democrats plan to reject the House-passed $1.33 trillion dollar spending package that includes Transportation-HUD (THUD) if Homeland Security funding remains in the “minibus” package.

• Last week, the House passed and sent the final FY 26 “minibus” package to the Senate before leaving DC for their recess this week. The package contained a variety of bills including Homeland Security, Defense, Labor-Health Human Services-Education, Transportation-HUD, and Financial Services.
• Passing the remaining FY 26 appropriations bills (including THUD) will require 60 votes in the Senate, which, as of last week, seemed possible. However, Democrats have pledged to reject the package if it contains Homeland Security (which includes ICE and Border Patrol) funding. Democrats helped pass the last two CRs to keep the government open in 2025.
• If the Senate makes changes to the “minibus” package, which appears likely, the changed package will then need to be sent back to the House for a vote, restarting the process.
• House members were away from D.C. this week but are expected to return this weekend (after Jan. 30), leading many to believe a weekend partial shutdown is likely. With most federal employees and agencies closed on weekends, the impacts of a partial shutdown under these circumstances would be dramatically reduced.
• There are also procedural hurdles in the Senate that could further slow the process.

Act Now! Tell Your Senators to Pass the Bipartisan FY 26 THUD Bill

Visit NAHRO’s Action Alert Center to send our latest advocacy letter to your Senators urging them to pass the bipartisan FY 26 THUD bill by January 30 to help housers. Anyone can send a letter, so share this with your networks and encourage them to also reach out to their Senators at this crucial moment for housers and the families we serve! 

What to Expect if There Is a Shutdown

HUD has pre-loaded funding for PHAs for their Housing Assistance Payments (HAP), Administrative Fees, and Operating Fund. Regular HAP and Admin. Fees have been made through March, and Operating Fund should be available through April 2026. FY 2025 Capital Fund amounts have been obligated. HUD was scheduled to release FY 2025 Operating Fund Shortfall amounts mid-Spring of 2026 — the shutdown may slow down this process. Project-Based Rental Assistance HAP is funded through March.

HUD is working on the ninth round of CY 2025 shortfall funding, which is tied to HUD’s budget reconciliation and is needed to prepare for CY 2026 funding, once approved by Congress. Because full VMS reconciliation is required, the process is slower and largely focused on data clean-up. HUD anticipates being able to bring staff in during a shutdown to complete the reconciliation and release this ninth round of shortfall payments. 

All other grants that have not been processed will be delayed during the shutdown. 

If there is a shutdown, NAHRO will continue to provide resources on our shutdown resource page.

NAHRO THUD Analysis and Next Steps

Our team is tracking developments over the larger FY 26 package and will update NAHRO members as they dive further into the bill. NAHRO’s in-depth coverage will be released once we have better information on how the Senate plans to address Democrat concerns over Homeland Security funding in the broader FY 26 funding package.

Housing Update from Washington

Earlier today, NAHRO discussed both shutdown preparations and FY26 HUD funding levels during our bi-weekly Housing Update from Washington. If you missed the session, don’t worry, it’s recorded!