Better Than the Alternatives, Still Not Good Enough: What’s in the Senate HUD Budget

On July 24, the Senate Appropriations Committee approved its FY2026 Transportation, Housing and Urban Development (THUD) budget proposal—offering a much better alternative to proposals from the House and the Trump administration. The bill passed by a vote of 27-1, demonstrating that Republicans and Democrats worked together to negotiate the package–an unfortunately rare example of bipartisanship in the current environment. Illinois Senator Richard Durbin, a member of the committee, voted in support.

The Good News

Overall, the Senate bill provides $73.3 billion for HUD, a modest increase compared to the current total funding. It’s also far better than the House’s $67.8 billion or the Trump administration’s proposal to slash HUD funding by 44%. The Senate bill also:

• Rejects harmful proposals to combine and block grant certain programs and does not give HUD the power to waive or create alternatives to key statutory requirements, such as income definitions, rent calculation formulas, or eligibility requirements and definitions.
• Largely preserves funding for programs at risk in other proposals, such as HOPWA, fair housing, housing counseling, and others.

The Bad News

Despite being better than the other proposals, the Senate bill still falls short, meaning that fewer individuals and families will receive assistance and some people will lose their home. The Senate bill:

• Fails to fully fund all existing Housing Choice Vouchers.
• Does not provide enough funding to renew all existing Continuum of Care projects to end homelessness with necessary funding increases to maintain existing services.
• Cuts funding for public housing, both operating and capital budgets.
• Provides no funding to maintain the Emergency Housing Voucher Program, which is currently keeping more than 59,000 households across the country housed, including 1,800+ in Illinois.

Congress has until October 1 to finalize the FY2026 budget—or risk a shutdown or continuing resolution. Passage of the budget will require 60 votes in the Senate and bipartisan co-operation.

More Information & Action Steps

• See the press release from Senators Durbin and Duckworth, which provides a detailed summary of the provisions of the THUD bill. It includes Congressionally Directed Spending initiatives, of which there are numerous projects to create affordable housing and end homelessness.
• Read the National Low Income Housing Coalition’s analysis of the Senate budget proposal.
• Contact your members of Congress. Organizations can also sign a national letter urging Congress to reject cuts to HUD programs and instead provide the highest level of funding possible.

Other Critical Federal Housing News

Trump Administration’s Executive Order on Homelessness is Unjust and Counterproductive

Housing Action Illinois joins all our allies in condemning the Trump administration’s July 24 Executive Order on homelessness, which criminalizes poverty and ignores proven solutions. We oppose this order because it will unfairly penalize people, including families with children, for our nation’s failure to treat housing as a basic human right and to provide the resources necessary to ensure that everyone has a safe, decent and affordable place to call home.

We also oppose the order because it is counter to evidence-based Housing First strategies and promotes criminalization and institutionalization that supports treating people experiencing homelessness in unjust, harmful, and counterproductive ways.

As our allies and partners have said: 

Read a brief but useful analysis of some of the Executive Order’s provisions by Ann Oliva, CEO of the National Alliance to End Homelessness, in her July 28 weekly update. 

Progress in the Senate: Bipartisan ROAD to Housing Act of 2025 Advances

Also on July 24, the Senate Banking and Urban Affairs Committee unanimously passed the ROAD to Housing Act of 2025, a bipartisan legislative package to increase housing supply and housing affordability with more than 40 different provisions. Here are highlights that complement Housing Action’s current work:

• Housing Counseling: New funding pathway via the Mutual Mortgage Insurance Fund (MMIF), a federal fund that acts as the insurer of mortgages that are guaranteed by the Federal Housing Administration (FHA). These funds would to cover the cost of mortgage delinquency and default counseling by HUD approved housing counseling agencies for government insured mortgages, i.e., FHA, VA, and USDA loans.
• Whole-Home Repairs Act: Grants and forgivable loans for health/safety repairs for low- and moderate-income homeowners and small landlords (5-year pilot program at HUD, subject to appropriation).
• Affordable Housing Investments: Raises the Public Welfare Investment cap for the Office of the Comptroller of the Currency (OCC) and the Federal Reserve from 15% to 20%, which will enhance banks’ capacity to make investments in affordable housing.
• Transit & Housing: Incentivizes housing near transit through Federal Transit Authority project scoring.
• Shelter Flexibility: Allows states and localities that receive Emergency Solutions Grant funding apply to exceed the 60% spending cap on emergency shelter beds and street outreach.

Read the Committee’s bill summary. We hope the bill will receive a vote from the full Senate soon.  

Trump Administration Proposes Reintroduction of Unjust Mixed-Status Family Rule

On July 16, HUD advanced a proposed rule that could bar mixed immigration status families from certain assisted housing—a harmful move earlier proposed by first Trump Administration (but blocked) in 2019.

Currently, mixed-status families are able to live in assisted housing but have their subsidy prorated to reflect the proportion of household members that is eligible.

We’ll be joining national partners through the Keep Families Together campaign again to oppose these policy changes. 

Stay Tuned

Keep watch for future advocacy alerts and updates from us in the coming weeks, so that you can support our efforts to oppose cuts and harmful policies.

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