Federal housing cuts will set KY back just when we need to build more homes | Opinion
Recently, the White House released the Administration’s proposed FY26 federal budget . The suggested cuts to housing and homeless services are dramatic.
The proposed budget would slash the U.S. Department of Housing and Urban Development by over $32 billion — a 44% cut to agency programs, which would all but eliminate our country’s housing safety net. A small portion of current funding levels would be disbursed to Kentucky in the form of block grants for public housing and rental assistance, and Kentucky would have to pick up the rest of the tab. Programs that effectively build self- sufficiency would be zeroed out, along with funding that Kentucky uses for infrastructure and housing construction.
It is worth explaining how these changes would impact Kentucky.
HUD cuts threaten Kentucky’s economy. HUD programs invest over $650 million that flow into our economy via private landlords, nonprofit agencies, private developers, and 119 local public housing authorities across our state.
HUD cuts put landlords and renters at risk. An estimated 10,600 Kentucky landlords use HUD rental assistance payments to help cover their mortgage and/or property costs. Many apartment complexes were financed based on long-term HUD rental assistance. Without the rental assistance, renters can’t afford to make their payments to landlords, which means landlords may not be able to afford to pay their mortgage or taxes.
HUD cuts put low-income Kentuckians at risk. Over 149,000 Kentuckians in 85,500+ households are helped by HUD programs. This includes people in every county—often our poorest families with children, elderly tenants, and disabled renters. A HUD rent voucher for many households is the difference between having money left over for food and transportation or going without.
HUD cuts will drive up homelessness. Homelessness in Kentucky increased 10% from 2023 to 2024. HUD funds are the backbone of our ability to help homeless Kentuckians regain stability and access services. If the federal housing safety net is shredded, how will cities and counties respond to escalating homelessness?
Kentucky needs to keep 100% of its current HUD funding—in fact, we need to build even more homes in every county. Kentucky has a severe housing supply shortage. We need 206,000 more homes and apartments to meet current needs. Our families feel the pressure of homeownership and rental costs that are increasing far faster than their income. More and more households spend too much of their monthly income on housing, leaving them without enough money for utilities, groceries, car payments, and childcare. In short, the impacts of these proposed cuts would be huge and reach farther than most would expect. It would impact every corner of our state.
HUD programs build starter homes constructed by Habitat for Humanity. HUD funds are helping Western Kentucky and Eastern Kentucky recover from natural disasters. HUD- funded complexes ensure low-income seniors can afford a place to live. A HUD rent voucher means a family has money left for food and transportation.
The answer to making these programs work better is not to eliminate them. Tens of thousands of Kentuckians remain stable and get ahead thanks to HUD programs. The cuts recommended by the White House would set Kentucky back just when we need to build more homes to increase affordability and position our state for future economic growth.
Winston Miller is CEO and Executive Director of Kentucky Housing Corporation, the state’s housing finance authority founded in 1972 that oversees programs ranging from home mortgages to homeless programs.