President Trump Releases “Skinny” Budget Request Foreshadowing Historic Cuts to HUD in Full FY26 Request – Take Action!
May 02, 2025
President Donald Trump released a “skinny” budget request today (May 2) indicating the administration will seek cuts that would decimate HUD’s vital affordable housing, homelessness, and community development funding in its full fiscal year 2026 (FY26) spending request, expected later this month. In total, the “skinny” request foreshadows a full request that will slash domestic spending by over 22%, including significant cuts to affordable housing, homelessness, and community development programs.
“The proposals outlined in this preliminary request are not only untenable, they are unconscionable,” said NLIHC’s Interim President and CEO Renee Willis. “At a time of rapidly rising rents, increasing economic hardship, and a record number of people experiencing homelessness, the Administration should be asking Congress to expand – not slash – federal investments in affordable housing and homelessness assistance, and working with Congress and communities to ensure these vital resources are available to every household in need.”
Overall, the “skinny” request would not only slash funding to vital affordable housing and homelessness assistance programs, it would redesign some of these programs entirely. The proposal would slash $26.72 billion from HUD’s rental assistance programs – including Housing Choice Vouchers (HCVs), Public Housing, Project-Based Rental Assistance (PBRA), Section 202 Housing for the Elderly, and Section 811 Housing for Persons with Disabilities – by combining them and block granting them into one program, State Rental Assistance Block Grants. The proposal is estimated to amount to an unprecedented 43% cut to HUD rental assistance, would impose a two-year time limit on receiving rental assistance for “able-bodied adults,” and “encourage States to provide funding to share in the responsibility to ensure that similar levels of recipients can benefit from the block grant.”
The outlined request proposes cutting Homelessness Assistance Grants (HAG) by $532 million, and “consolidating” the Continuum of Care (CoC) program and Housing Opportunities for Persons with AIDS (HOPWA) program into the Emergency Solutions Grant (ESG) program. Under the proposal, people experiencing or at-risk of homelessness would only be able to receive assistance for two years.
The “skinny” budget also proposes eliminating the Community Development Block Grant (CDBG) program and the HOME Investment Partnerships Program. It would eliminate the Indian Housing Block Grant (IHBG)-Competitive program and Native Hawaiian Housing Block Grant program, cutting $479 million and folding these programs instead into the formula-based Indian Housing Block Grant (IHBG) program. It would also eliminate the Family Self-Sufficiency (FSS) program, arguing “these programs are duplicative in purpose…such programs like these would be better left to State and local governments.”
The request would reduce funding for HUD’s Healthy Homes and Lead Hazards programs by $296 million, arguing the programs “[have] unobligated balances that should be depleted prior to receiving further appropriations.” It would eliminate the Pathways to Removing Obstacles to Housing (PRO Housing) program, designed to incentivize states and localities to adopt more inclusive zoning practices, and eliminate the Fair Housing Initaitves Program (FHIP), which is responsible for helping state and local fair housing organizations investigate and adjudicate fair housing complaints. The “skinny” proposal also asserts the President’s budget request would “maintain support for [the Fair Housing Assistance Program (FHAP)]” to fund State and local enforcement agencies processing fair housing complaints under the Fair Housing Act.
Other Affordable Housing Assistance Programs
USDA
In addition to the proposed cuts to HUD programs outlined in the “skinny” request, the proposal foreshadows major cuts to rural housing programs under the jurisdiction of the U.S. Department of Agriculture (USDA). While the outline promises an increase of $74 million for USDA’s Rental Assistance (RA) program, it also slashes $721 million from USDA’s Rural Development Program, including eliminating programs that the administration argues “are duplicative, too small to have a macro-economic impact, costly to deliver, in limited demand, available through the private sector, or conceived as temporary” – including “single family housing direct loans, self-help housing grants, and rural housing vouchers.”
LIHEAP
The “skinny” request indicates the President will propose eliminating the Low-Income Heating and Energy Assistance Program (LIHEAP), which helps households with low-incomes afford their energy bills, including heating costs in the winter and cooling costs in the summer, weatherization, and minor energy-related home repairs. The administration argues the program is “unnecessary because States have policies preventing utility disconnection for low-income households,” and the budget will “instead support low-income individuals through energy dominance, lower prices, and an America First economic platform.”
FEMA
The “skinny” request outlines a proposal to reduce “non-disaster” Federal Emergency Management Agency (FEMA) grant programs by $646 million, including eliminating the National Domestic Preparedness Consortium, although other specific details are not provided. It would also eliminate FEMA’s Shelter and Services Program.
Take action to protect and expand HUD’s vital affordable housing and homelessness assistance programs!
Advocates can use NLIHC’s toolkits and resources to take action on the FY26 spending bill, and urge federal lawmakers to expand – not cut – investments in HUD programs, including NLIHC’s top priorities:
- Full funding to renew all existing Housing Choice Voucher (HCV) contracts and funding to renew 60,000 Emergency Housing Vouchers (EHVs).
- Increased funding for public housing operations and public housing capital needs.
- $4.922 billion for HUD’s Homeless Assistance Grants (HAG) program.
- $20 million for the Eviction Protection Grant Program (EPGP).
- At least $1.3 billion for HUD’s Tribal housing programs and $150 million for competitive funds targeted to tribes with the greatest needs.
Use NLIHC’s toolkits and resources to take action on FY26 funding, including by:
- Emailing or calling members’ offices to tell them about the importance of affordable housing, homelessness, and community development resources to you, your family, your community, or your work. You can use NLIHC’s Take Action page to look up your member offices or call/send an email directly!
- Sharing stories of those directly impacted by homelessness and housing instability. Storytelling adds meaningful context to your message and can help lawmakers see how their policy decisions impact real people. Learn about how to tell compelling stories with this resource.
National, state, local, tribal, and territorial organizations can also join over 2,300 organizations on CHCDF’s national letter calling on Congress to support the highest level of funding possible for affordable housing, homelessness, and community development resources in FY26.