NCSHA Washington Report | June 20, 2025

In April, Representative Steve Womack (R-AR) hosted HUD Secretary Scott Turner in his northwest Arkansas district, where the Secretary was briefed on McAuley Place, which will provide homes for teachers, hospital workers, and other essential members of Bentonville’s workforce.

Womack, who chairs the House subcommittee that funds HUD, expressed the goal “that in a time of declining resources and potential cuts, we don’t want one person losing the housing that they have enjoyed.”

So it wasn’t surprising to hear his displeasure with the White House’s proposal to cut HUD funding by more than 50 percent when he hosted Secretary Turner again, last week, this time in his committee room on Capitol Hill. “Because of your Department’s important mission, Secretary Turner, I am deeply concerned about the deep cuts the Administration’s budget makes to HUD,” Chairman Womack said, “These proposed cuts would radically affect HUD’s mission and operations.”

The McAuley Place development the Secretary had heard about in Arkansas illustrates the point. Its primary financing source is Housing Credits from Arkansas Development Finance Authority. But the funding glue that holds the project’s financing together is HOME funds from the authority, via HUD. The White House would eliminate the program in its proposed budget.

Across Capitol Hill, Senator Cindy Hyde-Smith (R-MS), who chairs the Senate’s HUD funding subcommittee, took aim at the administration’s proposal to slash rental housing assistance by $27 billion and block-grant what’s left to the states.

“These programs serve approximately 4.5 million households, the majority of whom are elderly and disabled,” Chair Hyde-Smith told Secretary Turner, “I have a lot of concerns that losing this assistance would place these individuals at significant likelihood of homelessness.”

HUD’s HOME and rental assistance programs are a lifeline to millions of lower-income renters and the linchpin of thousands of privately-owned properties where they live.

The cuts the administration wants to make to them would pull the rug out from under hard-working, rent-paying members of every state. And they’d hurt an untold number of small businesses that build and operate their housing.

That’s why the National Association of Home Builders “strongly opposes” both proposals. In a letter to Secretary Turner, the builders said: “[W]e must caution that solving the affordable housing supply crisis will still require substantial levels of federal investment to complement deregulatory efforts.” NAHB is a member of the national HOME Coalition, which NCSHA leads on behalf of the 45 state housing finance agencies that administer HOME and their many private-sector partners in the program.

Even in a time of maximal presidential power, Congress ultimately will determine whether key federal housing programs survive and at what levels. As the House’s top appropriator, Representative Tom Cole (R-OK) said recently, “[W]ith all due respect to anybody, I think the members have a better understanding of what can pass and what can’t than the Executive Branch does.”

In light of that reality, HFA leaders will be more active in Washington, DC, during this summer’s appropriations season than any year in memory.

Stockton Williams | Executive Director

Washington Report will return July 3.

In This Issue

• Senate Reconciliation Bill Makes Housing Credit Expansion Permanent
• NCSHA in the News
• Looking Ahead

Senate Reconciliation Bill Makes Housing Credit Expansion Permanent
This week, the Senate Finance Committee released the tax portion of the Senate’s reconciliation legislation, the One Big Beautiful Bill Act. The committee language goes even further in increasing affordable housing production with the Housing Credit than the House did in its version of the reconciliation bill, permanently increasing Housing Credit authority by 12 percent and permanently lowering the bond financing threshold — the so-called “50 percent test” — to 25 percent. The House-passed version includes a 12.5 percent increase in authority, reduction of the bond financing threshold to 25 percent, and basis boosts for properties in rural and Native American areas, but each of these provisions would be available for only four years. Based on Novogradac estimates of the Affordable Housing Credit Improvement Act, the permanent reduction in the bond financing test alone would lead to the production and rehabilitation of more than one million additional affordable rental homes. Novogradac will soon provide updated unit production estimates for the lower bond financing test and the increase in the Housing Credit volume cap.

Senate leaders will bypass a markup in the Senate Finance Committee and hope to hold a floor vote on the comprehensive reconciliation bill late next week to give the House time to pass the final version and get it to the president’s desk by July 4. However, sticking to that timeline will be difficult. The Senate still needs to clear parliamentary hurdles associated with the reconciliation process, ensure the bill can get at least 50 votes — a challenge, as Democrats are expected to be lockstep in opposition and not all Republican Senators are ready to support the bill as written — and reach a deal with the House on the many areas where their bills diverge. Both chambers must pass identical language for the bill to become law. Major obstacles include the extent of Medicaid cuts, the phase-out schedule for clean energy tax credits, and the limit on state and local tax deductions, among others. The Senate language does not make any changes to alter the tax-exempt status of private activity bonds. It does not include NCSHA homeownership priorities to enhance and modernize the Mortgage Revenue Bond program or enact the Neighborhood Homes Investment tax credit.

For more information, see NCSHA’s blog.

NCSHA in the News
Chicago Crusader, 6.20.25, Commentary | As housing costs go up, HUD proposes 51 percent budget cut
Stateline, 6.16.25, Housing advocates worry states can’t fill rental aid gaps if Trump cuts go through
The Washington Post, 6.15.25, Opinions | Why did those apartments for the poor cost D.C. more than $1 million each?
Faharas, 6.4.25, Low-income home buyer grants and programs reducing upfront purchase barriers

Looking Ahead

Legislative and Regulatory Activities

• June 25 | Comments Due to NCSHA | HUD Proposed Rule on Affirmative Fair Housing Marketing Regulations
• July 3 | Comments Due | HUD Proposed Rule on Affirmative Fair Housing Marketing Regulations
• July 14 | House Transportation, Housing and Urban Development, and Related Agencies Appropriations Subcommittee: Markup of FY26 Transportation, Housing and Urban Development, and Related Agencies Appropriations Bill
• July 17 | House Appropriations Committee: Markup of FY26 Transportation, Housing and Urban Development, and Related Agencies Appropriations Bill
• August 1 | Comments Due | HUD Notice of Proposed Information Collection: Statutorily-Mandated Collection of Information for Tenants in LIHTC Properties

NCSHA, State HFA, and Industry Events

• June 21 | DC Housing Finance Agency Homeownership Fair | Washington, DC
• June 24 – 27 | NCSHA Housing Credit Connect & Marketplace | Chicago
• June 24 – 25 | South Dakota Housing Annual Conference | Pierre, SD
• July 1 | Government Finance Officers Association’s 119th Annual Conference | Washington, DC
  Garth Rieman will speak at this event.
• August 13 – 15 | 2025 Arizona Housing Forum | Tucson, AZ
• August 20 – 21 | Kentucky Affordable Housing Conference | Covington, KY
• September 3 – 4 | 2025 HousingIowa Conference | Cedar Rapids, IA
  Jennifer Schwartz will speak at this event.
• October 4 – 7 | NCSHA Annual Conference & Showplace | New Orleans