HUD to Cut Field Office Staff by May 18th; Stability of HUD Funding in Doubt
(March 4, 2025) On Feb. 24th, U.S. Department of Housing and Urban Development (HUD) leadership notified union management of the beginning of the agency’s Reduction in Force (RIF). The notification follows an executive order (EO) issued by President Trump on Feb. 11th that requires workforce optimization plans across federal agencies, including abolishing federal positions that are not specifically mandated by statute, as well as additional agency reorganization as defined through guidance provided by the U.S. Office of Personnel Management (OPM).
HUD’s Feb. 24th notification, sent by Secretary Scott Turner, announced that the agency will abolish all positions of GS-13 and below for employees in the Office of Field Policy and Management (FPM). This includes FPM staff in both headquarters and field offices. The notice reads that “GS-13 level and below are being abolished” by May 18, 2025.
While the RIF action announced on Feb. 24th will begin to impact field office work within HUD, the agency will likely continue to drastically reduce the workforce among its program staff, including within Multifamily Housing program offices, to achieve the stated goal of a 50 percent cut in staff at HUD.
LeadingAge is deeply concerned with the staff reductions, which could stop the agency from administering programs that affordable housing communities rely on, and is urgently requesting an explanation and revocation of the notice from HUD.
Meanwhile, with the March 14th expiration of the continuing resolution (CR) coming quickly, appropriators – who have been trying to determine an overall framework for fiscal year (FY) 2025 funding and then agree to the 12 annual appropriations bills before the March 14th deadline, along with House and Senate leadership – still do not have a plan. With the date fast approaching, one option that has seemed increasingly likely is a year-long CR which would fund programs at FY 2024 levels throughout FY 2025.
For HUD programs, funding at FY 2024 levels, as LeadingAge has argued in advocacy outreach to elected officials, is insufficient to fully renew multifamily rental assistance contracts and pay for rising costs in other HUD programs. In a win for affordable senior housing stakeholders, the White House’s list of anomalies (or exceptions) to funding at FY 2024 levels includes an additional $893 million for Section 8 Project-Based Rental Assistance (PBRA) renewals. Based on HUD’s request for FY 2025, this additional amount would provide HUD with sufficient resources to fully renew contracts in FY 2025. The list does not include an anomaly for Section 202 Project Rental Assistance Contract (PRAC) renewals.
However, hopes for even a year-long CR are fading as some in the White House and Congress hope to include spending cuts sought by the White House’s Department of Government Efficiency (DOGE) in a year-long CR. Senate passage of an appropriations bill, including a year-long CR, requires 60 votes. This means that Democratic votes will be necessary to pass a year-long CR, but Democrats have said they will not support a CR that includes DOGE-sought cuts.
Most recently, lawmakers are considering eliminating the tax exemption for interest earned on municipal bonds as a way to generate revenue to help pay for a budget reconciliation package that would extend expiring tax reductions, reduce taxes in other ways, and increase spending in areas such as border security and defense. Tax-exempt municipal bonds are a critical source of financing for non-profit and mission-driven providers of aging services. These funds support the expansion of existing senior living campuses to enhance offerings and serve more residents, modernization and renovation of existing buildings, refinancing of existing debt, and development of new projects, including affordable housing.
Stakeholders are urged to reach out to senators and representatives and call on them to preserve tax-exempt bonds.
Contact: Annalyse Komoroske Denio, akomoroskedenio@leadingageny.org, 518-867-8866