FHFA allocated $20 million to its Office of Inspector General for fiscal 2027, a 61.3% reduction from FY2026 levels and below the $55 million in the administration's own FY2027 budget request; FHFA's Sept. 30 release called the OIG "an extraordinary budgetary outlier among its peer OIGs," saying it had requested 16% of the agency's operating budget against a government-wide average of about 2%. Acting Principal Deputy Inspector General James Hodge wrote to Congress that the cut would force staffing reductions of 70-80% and "the discontinuance of essentially all criminal investigations." Eleven Senate Banking Committee Democrats called the decision unlawful in an Oct. 1 letter.
Federal News Network reported the OIG's criminal enforcement program has produced more than 1,270 convictions since 2011.
Tax Credit Advisor · on the ROAD to Housing Act's new CDBG new-construction authority
The 21st Century ROAD to Housing Act (Public Law 119-101, enacted July 11) made new home construction an eligible CDBG use, capped at 20 percent of each recipient's annual allocation for awards issued in FY2027 and beyond. A Tax Credit Advisor analysis of FY2026 allocations ($3.298 billion across 1,302 awards) put the theoretical ceiling at $659.6 million, with a median of $178,796 per recipient. HUD had not published implementation guidance as of publication.
The 50 largest CDBG grantees received 44 percent of FY2026 allocated funding.
USDA and HUD signed a memorandum of understanding required by Section 802 of the 21st Century ROAD to Housing Act to evaluate environmental-review categorical exclusions, designate a lead agency for jointly funded projects’ environmental documents, and study a joint physical inspection process. The release said USDA Rural Development invested more than $42 billion in FY2025 across housing, community facilities, water, broadband and business programs, and named HUD as lead for interagency coordination. Coordination leads are Rural Housing Service Administrator George Kelly for USDA and Chief of Staff Drew McCall and Deputy Chief of Staff Reid Wilson for HUD.
Section 802, the Streamlining Rural Housing Act, became law on July 11, 2026 as part of Public Law 119-101.
HUD OIG issued a 25-page memorandum to HUD General Counsel David Woll comparing admission and termination requirements across public housing, Housing Choice Vouchers, project-based rental assistance, Section 202/811, ESG, CoC, HOPWA and HOME for criminal activity, substance use and immigration status. The memo stated that because HUD has not issued regulations implementing PRWORA, it “still remains unclear the extent to which PRWORA applies to any HUD programs in practice,” and that programs not covered by Section 214 “might not impose any eligibility restrictions on the basis of immigration status.” It recounted the November 2025 HUD notice, HUD’s litigation stay in certain states, and the February 18, 2026 DOJ Office of Legal Counsel opinion that partially superseded the notice.
The November 2025 HUD notice the memo analyzes was vacated by the District of Rhode Island on September 21, 2026, three days before the memo’s date.