Parties Remain Divided on Healthcare Funding Issues
At midnight on October 1, the federal government began a complete shutdown. This marks the first complete government shutdown since late 2018, when appropriations lapsed from December 22, 2018, until January 25, 2019. That 35-day shutdown was the longest one the U.S. has ever experienced.
Members should continue normal operations during the shutdown. HAs may consider reaching out to key partners—such as Housing Choice Voucher landlords—to assure them that normal operations will continue for the time being. Members with questions about the impact of the shutdown should contact: policy@phada.org.
How We Got Here
As in many recent years, the FY 26 appropriations process has proven contentious. In May, the Administration released its budget request, which proposed deep cuts to HUD programs and a poorly conceived plan to block grant affordable housing funding to the states.
In July, both the House and Senate released their respective Transportation, HUD, and Related Agencies (T-HUD) appropriations bills. While neither chamber included the President’s deep cuts in their T-HUD bills, both the House and Senate proposed unsustainable cuts to public housing funding. The House also proposed flat voucher renewal funding—which, given rental inflation, would result in currently-assisted families losing assistance.
Similar to past years, Congress was unable to pass all 12 appropriations bills before the end of the fiscal year, thus necessitating a Continuing Resolution (CR) to keep the government funded. On September 19, 2025, the Republican-led House narrowly passed a CR, which was then blocked by Democrats in the Senate. If enacted, the CR would maintain level funding for HUD programs while also allowing the Department to repurpose unobligated voucher admin fees, special purpose vouchers, and tenant protection voucher funding to address voucher shortfalls.
Shutdown May Be Lengthy
As of press time, it appears that the shutdown may be lengthy. Democrats have objected to Republicans not negotiating with them when writing the CR, and are also pushing to extend subsidies on Affordable Care Act health plans. Republicans have countered that they will only negotiate extending those subsidies when the government is open. As of press time, the parties are not publicly negotiating to break this impasse
Of course, developments are fast-moving, and it is possible that the parties could come to an agreement to reopen the government sooner rather than later. PHADA staff have communicated with Congressional offices from both parties about the negative impacts of a shutdown on affordable housing programs. The Association also encourages members to contact their representatives about the negative impacts of a protracted shutdown.
HAs Should Have Sufficient Funding Through Mid-November
HUD staff have assured PHADA that agencies should have sufficient public housing and Housing Choice Voucher operating funding to ensure normal operations through mid-November. The Association understands that Field Office staff have been working with HAs in shortfall to avoid any current voucher families losing assistance.
Late on September 30, HUD published its shutdown contingency plan. That plan outlines which staff are required to work during the shutdown to ensure continued operations. It also discusses which Departmental activities will continue during the shutdown. As in prior shutdowns, the contingency plan notes that HUD will keep open eLOCCs and HUDCAPS to ensure that HAs can access obligated public housing and voucher funding.
PHADA understands that, should the Administration proceed with its proposed “Reductions in Force” layoffs that would coincide with a shutdown, HUD staff administering the public housing, HCV, and Multifamily programs are unlikely to be impacted. As of press time, the Department has not publicly commented on what, if any, Reductions in Force will occur during the shutdown.
While Republicans and Democrats are currently at an impasse on reopening the government, an agreement may come quickly. PHADA will continue to keep members updated regarding the latest on HUD funding through social media, eBlasts, and the Advocate.