Houston housing department outlines FY26 budget, flags federal funding exposure and homelessness spending

The Houston housing department presented its proposed fiscal 2026 budget at a council housing workshop, saying the department faces a smaller local allocation while remaining heavily dependent on federal grants and new special‑revenue money for street homelessness.

At the workshop the department said the FY26 general fund allocation it controls has been reduced by roughly 30 percent from FY25 (about $690,000) to a proposed $1,600,000, while a newly highlighted special revenue account for ‘‘in‑street homelessness’’ (Fund 2012) shows a balance presented in the slides as 31.485 (as presented). Department staff also said they expect all Fund 2012 dollars to be used for homelessness services and operations rather than personnel.

Why it matters: The department told council members it relies on federal programs for the overwhelming majority of its budget and staffing; the presentation slides listed 94.6 percent of the department of funding as federal, while presenters later said verbally that 98.7 percent of funding would come from federal sources. Staff warned that pauses or cuts in federal grants would have ‘‘drastic’’ effects on programs, residents and employees.

Key budget details and programs

- Federal grant exposure: The department identified HUD programs by name during the presentation (CDBG, HOME, ESG, HOPWA) and said HUD published FY26 allocations the morning of the workshop showing small increases in most programs (CDBG +3.5%, HOME +2.7%, HOPWA +2.8%) and a roughly $22,000 (~1%) lower ESG award than estimated. Staff said those FY26 changes affect the department beginning July 1, 2025, while larger federal‑budget proposals in the president budget would require congressional action in future years.

- Disaster recovery award (DR24): The presentation listed an authorized Disaster Recovery 2024 (DR24) award of roughly…