On May 2, 2025, the Trump Administration released a “Skinny Budget,” which refers to a document which lists ideas for spending increases and cuts without specific details, such as pay-throughs or off-sets. Essentially, it’s a “vision” document, which outlines the policy perspectives of the administration and what they hope is a direction for Federal agencies. Some might refer this document as a “wishlist” of objectives.
As stated in a letter from the Office of Management and Budget (OMB) Director Vought, to Congress, the “Skinny Budget” includes:
President Trump’s recommendations on discretionary funding levels for fiscal year (FY) 2026. They are being provided in advance of the President’s full fiscal plan to reach balance and restore confidence in America’s fiscal management, so that your Committee may commence with debate and consideration of appropriations bills for the upcoming fiscal year.
The letter from the OMB includes several pages of tables, which indicate “changes in the millions” for various reductions to federal discretionary spending programs. This includes cuts to all government agencies, most of them drastic in nature. As it relates to programs under the Department of Housing and Urban Development (HUD), there are are broad outlines that (in theory) would result in a reduction in spending as well as a re-shaping of housing policy.
The first proposal indicates a new restriction on rental assistance to “able bodied adults” to two-years. It does not indicate if those two-years are concurrent or lifetime, nor how verification of a person’s “able-body” would be performed (push-ups possibly).
The Budget would also newly institute a two-year cap on rental assistance for able bodied adults, and would ensure a majority of rental assistance funding through States would go to the elderly and disabled.
Moving Federal Rental Assistance to State Block Grants
The document also outlines a proposal to move housing assistance programs to “States” to administer through block grants, and each state would define and administer housing programs, presumably instead of the current Public Housing and Multifamily Section 8 models.
Federal dysfunctional rental assistance programs into a State-based formula grant which would allow States to design their own rental assistance programs based on their unique needs and preferences.
Assuming that the split-infinitive is a typo and this change is not referencing assistance to dysfunction only, this change is proposing to essentially eliminate federal rental assistance, which has been in place largely since the conclusion of World War II and assists more than ten million people a year. It should be noted that all of this change would be expected to occur in Fiscal Year 2026, during which time, programs that assist more than five million households would be transitioned to state programs that currently do not exist, administered by state agencies and departments that also do not yet exist.
Cuts to Community Planning and Development
Is that all? Hardly. The rest of the “skinny” budget for HUD focuses on programs administered under Community Planning and Development (CPD). These changes include:
- HOME Program – Eliminated
- Self-Sufficiency Programs – Eliminated
- Homeless Assistance Program Consolidations – Combine HOPWA and CoC into the Emergency Shelter Grants (ESG) program and ensure that assistance only goes to at-risk individuals for no more than two years (now everyone can go from homeless to self-sufficiency in two years).
- Community Development Block Grants (CDBG): The CDBG grants would be re-targeted with an undefined “formula” that would ensure that grants don’t pay for improvements in community development that includes exercise or arts.
- Pathways to Removing Obstacles (PRO) Housing & Fair Housing Grants: Eliminated Under Executive Order 14151, as the programs were determined to be a DEI initiative and “Woke”.
While these changes represent significant and fundamental revisions to how housing assistance is provided throughout the country, it should be noted that all of these proposals need to be turned into legislation by the Article 1 branch of the government – Congress. All of these new initiatives involve undoing decades of programs that have provided stable housing and helped build communities with rental assistance for lower income families as well as assist those deeply in need, such adults with AIDS and persons experiencing homelessness.
The budget proposal is certainly a new “vision” for housing assistance in America.
