Affordable housing threatened as Trump halts $1 billion slated for extending life of aging buildings

The Trump administration is halting a $1 billion program that helps preserve affordable housing, threatening projects that keep tens of thousands of units livable for low-income Americans, according to a document obtained by The Associated Press.

The action is part of a slew of cuts and funding freezes at the U.S. Department of Housing and Urban Development, largely at the direction of President Donald Trump and Elon Musk's Department of Government Efficiency, that have rattled the affordable-housing industry.

Preserving these units gets less attention than ribbon-cuttings, but it's a centerpiece of efforts to address the nation's housing crisis. Hundreds of thousands of low-rent apartments, many of them aging and in need of urgent repair, are at risk of being yanked out from under poor Americans.

The program has already awarded the money to projects that would upgrade at least 25,000 affordable units across the country, and details of how it will be wound down remain unclear.

A spokesperson for HUD did not respond to repeated requests for comment. But an internal document reviewed by the AP said the program is being “terminated” at the direction of DOGE. Two HUD employees, who have knowledge of the program and spoke to the AP on the condition of anonymity for fear of reprisal, confirmed the directive to shutter it.

On its face, the over $1 billion Green and Resilient Retrofit Program, passed by Congress in 2022, is intended for energy-efficiency improvements. It is distributed in grants and loans to owners of affordable housing in need of updating, including replacing or repairing heating and cooling systems, leaky roofs, aging insulation or windows, or undertaking floodproofing.

But the money plays a much larger role in preserving affordable units.

Projects that use the funds are required to keep their buildings affordable for up to 25 years. The money is also leveraged to pull in other investments for major repairs and renovations needed to keep the buildings livable.

It's like building a Jenga tower, where one of the program's grants or loans — which range from hundreds of thousands to millions of dollars — is a bottom block and each new block is another investment, housing advocates said.

This money “was essential in order for the project to come together,” said Mike Essian, vice president at American Community Developers, Inc., which received funding for several affordable-housing projects. “Projects will fail and these are projects that are already difficult to finance.”

The news has been a jolt to Al Hase and Joan Starr, tenants in an apartment building in Vancouver, Washington, full of other low-income seniors with few or no other options — most of whom live on less than $33,000 a year.

The 170-unit Smith Tower Apartments, built in the 1960s, is in need of updates, including its first building-wide sprinkler system. The $10 million award was a financial kickstart for its nearly $100 million project, and is cited in applications for other investments.

The potential loss “seriously jeopardizes our ability to be able to provide an upgrade to the current systems,” said Greg Franks, president of the property’s management company, adding that the work is "needed to sustain the livability of this building based on its age, and to keep it viable for another 60 years.”

“We are depending on that $10 million,” he said.

So, too, are Hase and Starr, a retired couple in their 70s who have lived there for 16 years.

They fill their balcony with geraniums and petunias, count the eagles at a nearby park and live off meager Social Security incomes. They learned about the potential funding loss in a letter from the apartment's management company.

“It’s kinda terrifying, it’s almost like getting news from a doctor that something's going to take your life in six months or a year,” Hase told the AP in a phone call.

“We're from an era where the wages weren't there, so our Social Security ...” he said, pausing. “Sucks,” pitched in Starr.

“If I'd been born a rich man,” he said. Starr added: “We’re just regular people.”

“And we're the lucky ones because we've got two social securities coming in," she said.

But being lucky ones doesn't count for much in today's rental market. “Prices keep going up, I've looked, and there's no way," she said.

“It’s the difference between living and not being able to live," he said.

HUD’s lack of communication about the program’s future sent organizations in search of contingency plans, though roughly two-dozen projects will still get funding, one HUD employee told the AP. The rest are in limbo.

“Each day of funding uncertainty increases the odds that deals will disintegrate,” said Linda Couch, a senior vice president at LeadingAge, a group whose members were awarded over $150 million.

As for Smith Tower, if the money doesn’t arrive, “we will certainly seek other funding to fill that gap,” said Travis Phillips of the Housing Development Center. “The reality is that will take time and will inevitably make the project more expensive.”

It’s the position several hundred other projects now find themselves in. The program provides finding for projects across 42 states, the District of Columbia and Puerto Rico.

“In all honesty,” said Michelle Arevalos, Smith Tower’s administrator, “if this building were not here, a lot of our folks actually probably would be homeless.”

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Bedayn is a corps member for The Associated Press/Report for America Statehouse News Initiative. Report for America is a nonprofit national service program that places journalists in local newsrooms to report on undercovered issues.