House Appropriations Panel Cuts HUD Budget as Shutdown Clock Ticks

WASHINGTON -- The House Appropriations Committee on July 17 approved a fiscal year 2026 spending bill for housing and transportation, cutting the Department of Housing and Urban Development's budget below last year's level and setting up a fight with the Senate over how deeply to trim federal housing programs before the October 1 deadline.

The committee passed the Transportation, Housing and Urban Development bill on a 35-28 party-line vote, according to the National Low Income Housing Coalition, which tracked the markup. The full committee vote followed a July 14 subcommittee markup that advanced the legislation.

The House bill proposes to fund HUD at $67.8 billion for FY2026, a decrease of $939 million from the FY2025 enacted level, according to the Bipartisan Policy Center, which reviewed the funding tables. That figure is $5.5 billion less than the Senate's competing proposal of $73.3 billion.

The cuts in the House bill are selective. The proposal eliminates appropriations for the HOME Investment Partnerships Program and significantly reduces the administrative fee account for the Housing Choice Voucher program, according to the National Association of Housing and Redevelopment Officials, which analyzed the bill text. The Housing Assistance Payment renewal account would be flat-funded, a move NAHRO said amounts to an effective funding cut given rising rental costs.

Despite those reductions, the House bill largely rejects the deepest cuts proposed by President Trump's budget request. Appropriations Committee Chair Tom Cole, R-Okla., had previously stated he would write FY2026 bills as close as possible to the president's request, which called for a 44 percent cut to HUD funding from FY2025 and proposed converting rental assistance into a state block grant, according to the National Low Income Housing Coalition.

The Senate side of the process remains unresolved. Senate Appropriations Committee Chair Susan Collins, R-Maine, and Vice Chair Patty Murray, D-Wash., have not yet reached a topline spending agreement, according to the National Low Income Housing Coalition. The Senate Appropriations Committee has yet to schedule a THUD subcommittee markup.

The two chambers face a hard deadline. Congress has until October 1 to pass final FY2026 spending bills or enact a continuing resolution to avoid a partial government shutdown. Any final spending bill will need at least 60 votes in the Senate, meaning Republicans will need Democratic support to clear the chamber, according to the National Low Income Housing Coalition.

The appropriations fight comes weeks after Congress cleared President Trump's first reconciliation package. Trump signed H.R. 1, the so-called One Big Beautiful Bill, into law on July 4 after the House passed it on a 218-214 vote, according to the American Council on Education, which reviewed the final bill. The House Freedom Caucus, which had initially opposed the reconciliation bill over deficit concerns, agreed to vote for it after receiving assurances from the Trump administration and House leadership that additional cuts would follow in the appropriations process, according to the National Low Income Housing Coalition.

That assurance is now part of the backdrop for the FY2026 spending fight. In exchange for their reconciliation votes, Freedom Caucus members were promised the White House would pursue cuts to discretionary programs during appropriations, according to the National Low Income Housing Coalition's review of the deal.

The House bill's total discretionary allocation for transportation, housing and related agencies is $89.91 billion, which is $4.458 billion, or 4.7 percent, below the FY2025 enacted level, according to a bill summary released by the House Appropriations Committee.

Sources cited:
- National Low Income Housing Coalition (https://nlihc.org/resource/house-appropriations-committee-releases-and-approves-fy26-spending-bill)
- Bipartisan Policy Center (https://bipartisanpolicy.org/article/fy2026appropriationsprocess/)
- National Association of Housing and Redevelopment Officials (NAHRO) (https://www.nahro.org/news/house-releases-fy-2026-thud-bill/)
- American Council on Education (https://www.acenet.edu/News-Room/Pages/Reconciliation-Bill-Narrowly-Passes-Congress.aspx)
- House Appropriations Committee (https://appropriations.house.gov/news/press-releases/committee-releases-fy26-transportation-housing-and-urban-development-and)