WASHINGTON, D.C. — The Trump administration has halted at least $60 million in financing intended for affordable housing developments across the nation, according to the Associated Press.
At the direction of the Department of Government Efficiency (DOGE), the U.S. Department of Housing and Urban Development (HUD) has terminated contracts for at least two of the three organizations in its Section 4 program, which the Associated Press states could stall the development of hundreds of affordable housing projects across the United States.
The Section 4 program, also known as the Capacity Building for Affordable Housing and Community Development program, allocates grants to support affordable housing and community development activities that benefit low- and moderate-income households.
Congress has selected three non-profit organizations to distribute the grants: Enterprise Community Partners Inc., the Local Initiatives Support Corp. (LISC) and Habitat for Humanity International. The intermediary organizations received roughly $83 million in Section 4 funding in fiscal years 2022 and 2023, which is the most recent data available from HUD.
LISC warned that the decision will stall progress in affordable housing and community development nationwide, reduce access to housing, slow job creation and weaken local economies.
“Instead of pro-growth activities, stop-work orders are now taking away investments already made,” the organization argued in a statement. “Over time, the withdrawal of HUD’s support will cripple community development organizations and undercut the ability of communities to build prosperity from the ground up. The impact will fall most heavily on people and places experiencing high rates of poverty, joblessness, chronic disease, and public safety concerns.”
The move comes amid a concentrated effort by the Trump administration to cut federal funding, contracts and staffing. According to the documents the Associated Press reported obtaining, DOGE stated that the groups’ operations were not in compliance with Trump’s executive order issued on Jan. 20 that rolled back diversity, equity and inclusion initiatives.
“Make no mistake: this decision will raise costs for families, hobble the creation of affordable homes, sacrifice local jobs, and sap opportunity from thousands of communities in all 50 states,” said Shaun Donovan, president of Enterprise Community Partners and former HUD secretary under President Barack Obama, in a prepared statement. “We intend to pursue every avenue to ensure these vital programs are not torn away from the neighborhoods and working Americans who benefit from them.”