Federal Housing Policy Update During California’s Summer Recess

While the California Legislature is on Summer Recess, significant budget and legislative activity continues at the federal level. A major milestone was the signing of the One Big Beautiful Bill Act, which marked a substantial victory for affordable housing development. Key provisions include:

  • A reduction in the bond financing threshold from 50% to 25%
  • A permanent 12% increase in Housing Credit allocations

As the start of Fiscal Year 2026 (October 1, 2025) approaches, both the House and Senate are actively advancing their appropriations bills to fund the federal government. However, Congress’s proposed budget diverges sharply from that of the Trump Administration, particularly in its funding levels for housing programs under the Department of Housing and Urban Development (HUD) and the Department of Agriculture (USDA).

The Council for Affordable and Rural Housing (CARH) has published two helpful charts comparing the proposed appropriations and their specific funding commitments for USDA and HUD programs.

While the Trump Administration has proposed cuts—or complete eliminations—for several housing programs, both the House and Senate have moved to restore or increase funding. Notable highlights from the Senate’s proposed appropriations include:

Department of Agriculture

  • $1.715 billion for the Section 521 Rental Assistance (RA) program
  • $48 million for the Section 542 Voucher program (proposed for elimination by the Administration)
  • $60 million for the Section 515 Rural Rental Housing program (also proposed for elimination)
  • $34 million for the Multifamily Preservation and Revitalization (MPR) program (the Administration proposed only $15 million)

Department of Housing and Urban Development

  • $37.4 billion for Tenant-Based Rental Assistance (the Administration proposed block granting these funds to states)
  • $17.804 billion for Project-Based Rental Assistance (also proposed for block granting)
  • $3.1 billion for the Community Development Block Grant (CDBG) program (targeted for elimination by the Administration)
  • $1.2 billion to reinstate funding for the HOME Investment Partnerships Program (both the House and Administration proposed cuts)
  • $972 million for the Section 202 Housing for the Elderly program
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