NCSHA Washington Report | November 7, 2025
When the federal shutdown started October 1, the White House saw an opportunity to end programs it objects to, accelerate firings of federal workers, and inflict maximum political pain on Democrats.
“The Democrats are getting killed in the shutdown, because we’re closing up programs that are Democrat programs that we’re opposed to,” President Trump said two weeks in. “And they’re never going to come back, in many cases.”
“We want to be very aggressive where we can be in shuttering the bureaucracy — not just the funding, but the bureaucracy — and we now have an opportunity to do that,” his budget director, Russ Vought, said the following day.
As the closure dragged on, Democrats determined that the actual pain it’s inflicting was a price worth Americans’ paying in the standoff with Republicans.
A week after the president’s comments, Rep. Katherine Clark (D-MA), the second-ranking Democrat in the House, said, “There will be, you know, families that are going to suffer. We take that responsibility very seriously. But it’s one of the few leverage times we have.”
Now that the Democrats believe the shutdown helped them have a successful Election Day this week, a view President Trump seems to share, some in the Senate, where their votes are needed to reopen the government, want to keep holding out, even as costs continue to mount for millions.
As of this afternoon, both sides are still not willing to overcome their political self-centeredness and get to an agreement on one of Congress’ most basic responsibilities: funding the government. The shutdown will continue into the weekend at least.
There are some signs it could end next week. But a deal to reopen the government would be only the beginning of getting back to what should be normal operating procedure.
Immediate relief will need to flow to people who have already suffered harm: federal workers and members of the military, food stamp recipients, Head Start program participants, among many others.
Similarly, low-income assistance programs administered by HFAs and other governmental and nonprofit organizations, such as homelessness assistance and home energy aid, which have been running on fumes, will need fast replenishment in many parts of the country. (HUD to its credit was able to get word out last week that, even if the shutdown continues a while longer, federal rental assistance funding would flow through December.)
And the multiple agencies across the federal government whose financial backstops and approval processes are essential to the functioning of the housing financing system will have to restart with high-priority attention to time-sensitive transactions, whether they are buyers about to see a purchase fall through or builders rushing to close on financing by the end of the year.
An extraordinary amount of other work will have to happen quickly across the government to fill in the hole Congress has dug.
Is it any wonder a new Pew Research Center poll finds “Americans largely have negative feelings toward both political parties, while positive sentiments are far less common”?
Stockton Williams | Executive Director
In This Issue
- NCSHA Submits Comments to FHFA on GSEs’ Affordable Housing Goals, Proposed Strategic Plan
- Negotiations to End Federal Shutdown Continue
- Flood, Cleaver Introduce New Version of HOME Reform Legislation
- Lawler, Kim, Beatty Introduce Bill to Raise Public Welfare Investment Cap
- NCSHA in the News
- Looking Ahead
NCSHA Submits Comments to FHFA on GSEs’ Affordable Housing Goals, Proposed Strategic Plan
The Federal Housing Finance Agency (FHFA) should set Fannie Mae and Freddie Mac’s affordable housing goals at levels that reflect their leadership in the market, NCSHA argued in comments submitted to the agency earlier this week. The letter was sent in response to FHFA’s proposed affordable housing goals for the government-sponsored enterprises (GSEs) for 2026 – 28. In the letter, NCSHA expressed concern about FHFA’s proposal to reduce the GSEs’ single-family housing goals for low-income and very low-income home buyers to levels below the market share for such loans and urged FHFA to adjust the goals upward to reflect the GSEs’ role as market leaders. NCSHA further requested FHFA increase the GSEs’ affordable multifamily housing goals, which the proposed rule would maintain at current levels.
Also this week, NCSHA sent FHFA a letter with input on the agency’s proposed strategic plan for fiscal years 2026 – 30. The plan outlines the agency’s priorities as the regulator of the Federal Home Loan Bank (FHLB) system and Fannie Mae and Freddie Mac. In the letter, NCSHA thanked FHFA for including in the plan specific objectives to ensure the GSEs and FHLBs take action to expand housing supply and to encourage GSE participation in the Housing Credit market. NCSHA intends to work with HFAs to develop proposed policies and initiatives for addressing the affordable housing supply shortage that it will share with FHFA.
Negotiations to End Federal Shutdown Continue
The lapse in federal appropriations that began October 1 has now resulted in the longest shutdown of the federal government in history, causing disruptions in service areas from food assistance to air travel. While the impact on federal housing programs has been less pronounced than for some other federal programs and services, some partners of the Department of Housing and Urban Development (HUD) have experienced difficulty obtaining manual sign-off on new grant agreements or other activities, and HUD staff have not been available to respond to questions or inquiries. Concerns extend to the backlog of needs once the government does reopen. While a clear path to ending the shutdown remains elusive, a bipartisan group of Senators has begun talking about potential strategies.
Flood, Cleaver Introduce New Version of HOME Reform Legislation
Last Friday, House Financial Services’ Housing and Insurance Subcommittee Chair Mike Flood (R-NE) and Ranking Member Emanuel Cleaver (D-MO) introduced a new version of their HOME Reform Act (H.R.5878) in response to objections from labor organizations representing building and construction workers and from domestic manufacturing interest groups. The new version eliminates a provision in the previous bill that would have increased the threshold at which Davis-Bacon prevailing wage requirements apply to projects using HOME funding, from 12 to 24 units, and instead maintains the existing Davis-Bacon threshold at 12 HOME units. While the bill still would eliminate the Build America, Buy America (BABA) requirements from currently allowable HOME activities, it would maintain BABA’s application to a new eligible activity established in the bill: the use of HOME to pay for infrastructure activities associated with the construction or rehabilitation of HOME- or Housing Credit-financed developments.
Lawler, Kim, Beatty Introduce Bill to Raise Public Welfare Investment Cap
This week, Representatives Mike Lawler (R-NY), Young Kim (R-CA), and Joyce Beatty (D-OH) introduced House legislation (H.R.5913) to raise the cap on banks’ public welfare investments (PWIs) from 15 to 20 percent. The bill is companion to the Community Investment and Prosperity Act (S.2464), which Senate Banking Committee Chair Tim Scott (R-SC) and a bipartisan group of committee members introduced earlier this year. The Senate PWI bill is included in the comprehensive ROAD to Housing legislation, which the full Senate passed in October as part of the National Defense Authorization Act. Increasing the PWI cap would provide banks that are at or nearing their caps with greater flexibility to increase their Housing Credit and other public welfare investments. As we reported last week, NCSHA helped spearhead an October 30 letter from the ACTION Campaign to House Financial Services Committee leaders in support of increasing the PWI cap.
NCSHA in the News
U.S. News & World Report, 11.4.25, Home Loan Programs for Teachers: What You Should Know
Novogradac, 11.3.25, State Housing Agencies Should Quickly (and Wisely) Implement the 25% Financed-By Test
Window + Door, 10.31.25, AIA Housing Summit Brings Leaders Together to Discuss Policy
NCSHA, State HFA, and Industry Events
- November 12 – 13 | 2025 WHEDA Conference | Madison, WI
Jennifer Schwartz will speak at this event. - November 14 – 16 | 2025 NAR NXT | Houston, TX
Greg Zagorski will speak at this event. - November 17 – 19 | AHF Live | Chicago, IL
Jennifer Schwartz will speak at this event. - December 2 | National Women’s Affordable Housing Network Quarterly Policy Update | Virtual
Jennifer Schwartz will speak at this event. - December 5 | Early-Bird Registration Deadline: NCSHA’s HFA Institute 2026 | Washington, DC
- December 5 | Application Deadline | Vera Institute of Justice RFP: Opening Doors Technical Assistance
- December 16 | Housing Supply 2025: Market & Policy Achievements & 2026 Opportunities | Virtual
- January 11 – 16 | NCSHA’s HFA Institute 2026 | Washington, DC
