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HHS warns HUD renewal changes could force county to replace $4.3M in housing funding
Summary
HHS staff told Montgomery County council committees that anticipated 2026 HUD NOFO changes could reduce renewal eligibility and leave about 350 people without renewed continuum-of-care support, requiring local replacement of roughly $4.3 million.
Christine Hong, the county's chief of services to end and prevent homelessness, told the joint committee that a recent appropriations bill and expected 2026 HUD Notice of Funding Opportunity (NOFO) changes will reduce the share of renewals the county can secure and could force the county to replace nearly $4.3 million in federal funding.
"It is likely 40% of our federally funded housing programs will be cut in 2026," Hong said, adding that the affected funding supports about 350 people in permanent supportive housing and rapid rehousing. She and DHCA staff urged retaining contingency in the Housing Initiative Fund so the county can respond if federal support does not materialize.
Hong traced the change to earlier NOFO proposals that sharply reduced "tier 1" renewal allocations and to advocacy that pushed Congress to require at least 60% tier-1 renewals in a recent appropriations bill; however, she said the upcoming NOFO still leaves a projected 40% gap the county must plan for. Committee members discussed using contingency funds as a partial backstop while acknowledging $1.4 million would not close the full projected loss.
