HUD funding cuts: How housing authorities are adapting

By Niki Kolisch on July 23, 2025 in News

Housing authorities across the nation are facing one of the most uncertain periods in recent memory. Shifting regulations, tighter budgets and compliance pressures are putting overwhelming strain on the public housing sector. What’s more, recent and proposed HUD funding cuts are creating financial shortfalls, forcing agencies to make some tough choices. Yet, one thing remains true: housing authorities aren’t backing down from their mission to serve their community.

The reality is that over 30% of housing authorities nationwide are in what’s known as “shortfall,” meaning their financial obligations exceed the amount of funding they received. Rob Fredericks, executive director of the Housing Authority of the City of Santa Barbara, shared, “Our agency, like many others across the nation, fell into shortfall at a level we have not seen before. It is jarring to see this happen.” They are now pursuing other funding sources and scaling their programs to match their resources.

These funding cuts have only made housing authorities act with more creativity and grit than ever before. They’re finding new ways to operate and innovate, proving that no matter what changes come about, their mission remains strong: to continue to serve low-income communities.

And they’re not alone. Many partners, including those in the tech and housing finance sectors, are stepping up to offer solutions that help agencies do more with less.

Here’s how housing authorities are addressing funding challenges:

Getting creative with funding

With federal dollars stretched so thin, housing leaders say entrepreneurial thinking will be essential. Housing authorities are now tapping into non-HUD sources like bank loans, tax-exempt bonds and property acquisitions to fund programs.

Take the Palm Beach County Housing Authority, for example. They’re actively expanding their reach by managing properties beyond their usual scope. “We’re testing our wings and exploring what else we can do, and how we can leverage what we do well,” shares Carol Jones-Gilbert, CEO, Palm Beach County Housing Authority. The agency now manages a La Quinta Inn, using their property management expertise in new, innovative ways.

Partnering with state programs is another way housing authorities are adapting to HUD funding cuts. A powerful example is how HASB recently received $5.9 million in Homekey+ funding to convert a former motel into 32 units of supportive housing. They paired the state grant with a $6 million loan from the Banc of California. This is a creative form of conventional financing that shows how housing authorities can blend public and private funding to move projects along.

Building trust through transparency

In times of uncertainty, being honest with the public can help ease fear. Leaders like Rob Fredericks and Elenore Vaughn emphasized how important it is to share their challenges with the community.

HASB recently paused issuing new section 8 vouchers due to federal funding cuts, a decision that will likely affect 900 households. But Rob Fredericks isn’t keeping tenants in the dark about this. He sent letters to tenants explaining how this step was unavoidable and how the agency is working to navigate the shortfall. He told Noozhawk, “We understand the significant impact these measures will have on our community, especially for those families awaiting housing assistance. These decisions were not made lightly but are necessary to maintain housing stability for those families currently receiving assistance.”

This kind of transparency helps the community understand why these decisions had to be made and reinforces Fredericks’ statement: “We’re in this together, and we’re not giving up.”

Using technology to do more with less

Technology continues to help agencies stretch their resources further. Agencies can’t afford to be slowed down by spreadsheets and manual processes, especially not in today’s environment. Investment in technology today can help you streamline your operations.

Automated systems turn hours of work into minutes. Online rent collection, like what HASB uses, simply makes things easier for residents and cuts down on administrative tasks. You can also automate other processes like waitlist management, inspections and reporting. Yardi technology also provides social service components so you can easily work with participants and other community providers on recertification processing, invoice coding and approvals.

Data helps you make informed decisions. When funding is tight, data analytics show you exactly where your resources are most needed and help you make a compelling case for investors. Tools like Yardi Data Connect help housing authorities track voucher utilization, lease-up rates and other key metrics.

Your tech partnership matters. With tools that are constantly evolving and live compliance updates, housing authorities can stay ahead of changing regulations. Transparency shouldn’t solely come from housing authorities, but also your tech provider. Yardi is committed to keeping clients informed as the landscape shifts. Chuck Manly, vice president of Yardi Affordable Housing and PHA, said, “There are a lot of uncertainties, but Yardi is here to help. Efficiency is top of mind, and our suite of products can help our clients save money and better serve their residents.”

Bottom line

Uncertainty is never easy. But we’ve seen how the best housing leaders rarely back down from a challenge. Agencies are showing resilience and rethinking how they secure funding. Times like these demand willingness to step into new areas and try new approaches.

If you’re looking to better understand how your agency can adapt to funding shortfalls or improve operational efficiency, let’s connect. Our team can walk you through some strategies to reduce costs and streamline housing operations.

Reach out to your sales representative if you have questions about HUD funding cuts.

HUD funding cuts: How housing authorities are adapting

Getting creative with funding

Building trust through transparency

Using technology to do more with less

Bottom line

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