Trump Administration Releases Full FY 2026 Budget with Devastating Proposed Cuts to Housing and Community Development Programs
June 2, 2025 — On May 30, the Trump Administration released its full fiscal year (FY) 2026 budget proposal, adding very little additional detail to the “skinny budget” released on May 2. Typically, the President’s proposed budget is a messaging document that is unlikely to become law, and Congress retains the final authority in deciding the contours of the FY 2026 budget.
The President’s budget proposes two major changes, among others, to the Department of Housing and Urban Development’s (HUD’s) programs: devastating cuts to housing and community development programs and the creation of a State Rental Assistance Block Grant.
First, the proposed budget would make a series of changes to community development programs. The HOME Investment Partnerships (HOME) and Community Development Block Grant (CDBG) programs, which provide critical resources to communities across the country, are proposed to be eliminated. The budget would additionally consolidate the Continuum of Care (CoC) program and Housing Opportunities for Persons with AIDS (HOPWA) into a more targeted Emergency Solutions Grant (ESG) program. Funding for individuals would be capped at two years.
Second, the proposed State Rental Assistance Block Grant would combine funding for Public Housing, Section 8 Tenant-Based and Project-Based Rental Assistance, Housing for the Elderly, and Housing for Persons with Disabilities into one block grant to the states — and cut the total funding to the program by $26.718 billion overall. The proposed grant program would also place a two-year cap on rental assistance for able bodied adults and would eliminate funding for self-sufficiency programs.
NAHRO firmly opposes the scope of these cuts and block-granting rental assistance to states. Enacting these proposals would have a devastating impact on millions of families across the country and block-granting funding would make it easier for Congress to cut rental assistance in the future.
The appendix containing the President’s full budget proposal can be found here (HUD’s proposed budget begins on page 461). NAHRO will provide additional in-depth coverage of the FY 2026 budget proposal later this week.
Congress ultimately decides FY 2026 funding — this budget proposal is the beginning of the appropriations process. Now is the time to contact your members of Congress and share how these harmful cuts would impact your community! Visit the NAHRO Action Alert Center to send a pre-written, customizable letter to showcase the vital work of PHAs and community development organizations and to urge Congress to support for affordable housing and community development programs.