Updated January 2025

Disclaimer:

  • MRI is not providing a comprehensive list of HUD/compliance changes.
  • Any compliance changes noted herein may not apply to all agencies, programs or organizations. 
  • News is changing daily so please keep an eye out on the HUD website for updates.

Public Housing Compliance Updates

NSPIRE (National Standards for Physical Inspection of Real Estate) — NEW!
HUD PIH Notice 2025-19 – EHV to HCV Transition Guidance

HUD has issued Notice 2025-19 to guide Public Housing Agencies (PHAs) in transitioning families from the Emergency Housing Voucher (EHV) program into the regular Housing Choice Voucher (HCV) program. This comes as HUD has announced it will no longer provide renewal funding for EHVs beyond September 30, 2025. The notice outlines how PHAs can ensure families continue receiving housing assistance without disruption.

Key points include:

  • EHV funding will end on September 30, 2025 — no additional renewal funding will be provided by HUD.
  • PHAs can use regular HCV funding to continue assistance for current EHV families.
  • Families may remain in their current units without needing a new HAP contract or tenancy addendum.
  • PHAs are encouraged to adjust waiting list preferences and screening policies to prioritize these transitions.
  • EHV service fees must be spent within 60 days of the notice date (by August 19, 2025).
  • All related reporting must be completed within 120 days (by October 18, 2025).
HOTMA (Housing Opportunities through Modernization Act)
  • Certain provisions of HOTMA, specifically Sections 102 and 104, had a compliance date of July 1, 2025. However, many provisions are still on hold due to existing PIC errors and the inability to make changes to IMS PIC.
  • A blog post from Nan McKay provides a clear outline of what must be done, what may be done, and what is on hold. The blog post is particularly useful for understanding the current status of HOTMA provisions and what actions need to be taken by agencies. Click here to access other resources from Nan McKay's HOTMA Resource Page.
    • What must be done: These are the provisions that are mandatory and have a compliance date.
    • What may be done: These are optional provisions that agencies can choose to implement.
    • What is on hold: These are provisions that cannot be implemented due to existing PIC errors and the inability to make changes to IMS PIC.
  • This FAQ document from HUD outlines the HOMTA requirements in further detail.
HIP (Housing Information Portal)
  • The HIP project remains on hold with no clear timeline for progress. We are in contact with industry groups and will share updates as soon as available.
  • There has been no communication with any HUD representatives since January 2025.
Public Housing Product Updates
  • All Public Housing software packages are up to date to meet the 2024-38 PIH notice.
  • PHA Pro, Lindsay Software, Tenmast and HAB: These software packages did not require changes to support PIH Notice 2024-38. They are ready to implement the minor policy changes outlined in the notice, which must have been implemented by July 1, 2025.
  • HIP Readiness: All software packages are prepared to test with the original 50058 form, but the 2024 version is on hold due to the lack of a final technical reference guide.
  • HOTMA Changes: The implementation of HOTMA changes is on hold until the new version of the 2024 form and HIP are ready.

Affordable Housing Compliance Updates

HOTMA (Housing Opportunities through Modernization Act)
  • Implementation of Sections 102 and 104 of HOTMA have a compliance date of January 1, 2027.
TRACS 203A
  • The specification guide for TRACS 203A was rescinded in October, with new dates expected in January, March, and April. HUD has indicated that full compliance is expected by January 2027.
  • Compliance Timeline: HUD provides six months' notice before requiring full compliance. The compliance date has been updated to January 1, 2027.
  • Program Enhancements: We have made over 70 program enhancements, equating to over a year's worth of work, to ensure compliance with TRACS 203A.
  • Gender/DEI Policies: There are questions about whether the new gender options will need to be removed due to DEI policies.
    • Current DEI Administration Protocol: For example, the 50059 field 44 now includes two more variables: "owner agent didn't ask for the gender" and "non-binary".
  • Waiting for Specifications: Waiting for updated forms, specifications, and OMB approval before finalizing the rollout plan and providing training.
  • We are prepared to implement the changes quickly and efficiently once the specifications are released.
  • 30 Day Notice of Proposed Information Collection: Public comment period has ended and HUD contractors are in the process of reviewing the documentation and comments before presenting the final version of the forms and reports.
About the HUD Website
  • Removal of Previous Specifications: HUD has removed all previous specifications from their website. This means that even if they wanted to refer back to the previous specifications for TRACS 203A and HOTMA, they cannot do so because the pages are no longer available.
  • Waiting for Updated Forms and Specifications: We are waiting for updated forms, specifications, and OMB approval before they can finalize the rollout plan and provide training. This delay is causing uncertainty and hindering progress.
Affordable Housing Product Updates
  • Compliance with Regulatory Guidelines: USDA has set an implementation date of 7/1/2025 and the Affordable Housing product has been updated to accommodate the changes to the Rural Development program relating to the HOTMA updates.
  • Tax Credit Forms: Many states have already adopted changes to LIHTC rules related to the HOTMA updates. As such, Tenant Income Certification (TIC) forms have been updated. We have prioritized these forms and are working to get them implemented into our system. To date, we have implemented 12 new TIC forms to service our existing clients with another 9 coming in February's release. We will continue to release HOTMA TIC forms until all are incorporated.
  • Parity Between Bostonpost and MRI Affordable Housing: There is a focus on ensuring parity between Bostonpost and MRI Affordable Housing. This means that whatever can be done in Bostonpost should also be possible in MRI Affordable Housing, with the goal of making the systems better, faster, and more efficient.
  • Enhancing the Product: The 2026 roadmap has been finalized which includes enhancements to Mixed-use properties, Agora Insights dashboards, Online recertification processes to reduce in-office visits, resolution of software bugs, and improvements to reports.
  • Program Enhancements: We have made more than 70 program enhancements, equating to almost a year's worth of work. This includes more than 1,750 man-hours of programming to ensure compliance and improve the product.

Federal Funding Updates

January 2025 Federal Funding Update

As of July 1, 2025, major federal legislative moves are reshaping the affordable and public housing landscape. This month’s key updates focus on the Senate’s finish line for the “One Big, Beautiful Bill” (OBBB) and the FY 2026 federal budget outlook.

"One Big, Beautiful Bill" 

The OBBB was signed into law on July 4, 2025.

Housing Takeaway: The package includes the most significant affordable housing tax-credit expansion in decades, potentially enabling half a million to over a million new units.

Summary of Senate-Passed LIHTC Expansion Provisions
  • Permanent Increase in Housing Tax Credits: Makes a 50% increase in LIHTC funding permanent for states (instead of just for two years). States get a lot more money every year to fund affordable housing projects. This means more apartments can get built or preserved, especially where demand is highest.
  • Lower Requirement for Bond Financing (for 4% Credits): Cuts in half the amount of bond funding a project must use to qualify for the 4% housing credit—from 50% down to 25%. It’s now much easier for housing developers to qualify for this important funding tool. That opens the door for more rehab and preservation projects, not just new builds.
  • Extra Incentives for the Most Underserved Areas: Gives a 50% funding boost for developments that house extremely low-income families. Gives a 30% boost to projects on tribal lands or in Native communities. These areas often get overlooked because rents are so low, the math doesn’t work for developers. These boosts make those projects financially viable, helping ensure the most vulnerable get safe, affordable homes.
  • Built-In Protections for Residents: Strengthens protections for renters—especially veterans, survivors of domestic violence, and others at risk of discrimination or eviction. These protections make sure people living in LIHTC housing can stay safe, stable, and housed, even in tough personal circumstances. It also ensures housing providers follow fair housing rules.
  • Projected National Impact Experts estimate the expanded LIHTC could fund 1.22 million new affordable homes over the next 10 years (2026–2035). If you live in or near a city with rising rents, this could bring more affordable apartments online faster — and help reduce housing instability and homelessness.
As of Early January 2026

The federal government shutdown that began on October 1, 2025 officially ended when Congress passed and the President signed a Continuing Resolution (CR) on November 12, 2025, restoring funding for federal agencies including HUD. The CR funds most agencies at FY2025 levels through January 30, 2026, while lawmakers continue negotiating full-year FY2026 appropriations. 

Although the shutdown is over, HUD and other agencies are still working through administrative backlogs, and funding uncertainty remains beyond the current CR expiration date.

Key status updates

  • Shutdown Over: The federal government has reopened and resumed operations under the CR, including HUD programs. 
  • Temporary FY2026 Funding: HUD and most federal programs are funded at FY2025 levels through January 30, 2026. 
  • Reduced Short-Term Risk: HAP payments, voucher disbursements, and other rental assistance operations are expected to continue, though timing may still be uneven while agencies catch up.
  • Operational Backlogs: Some administrative functions, notices, renewals, and reviews may be delayed as staff catch up from the shutdown period.
  • Future Funding Uncertainty: If Congress does not pass a full FY2026 appropriations bill or extend the CR by January 30, another funding gap could occur. 

Practical Implications for Housing Operators

Project-Based Section 8 and Other Subsidy-Reliant Properties

  • HAP payments and related subsidy disbursements are expected to continue under the current CR funding.
  • Owners should monitor contract anniversaries, renewals, and compliance deadlines closely due to possible processing delays.

Housing Choice Voucher (HCV) Programs

  • Voucher payments should continue without interruption while the CR is in place.
  • PHAs may still experience slower processing on administrative actions while HUD resumes normal operations.

Timing Expectations

  • Short Term (Now – 4–6 weeks): Payments should continue, but timing may be uneven as agencies work through backlog.
  • Through Jan. 30, 2026: Funding remains stable under current CR, but HUD operational pace may still be slower than normal.
  • Post–Jan. 30 Risk Window: Without a new CR or full FY2026 appropriations, another lapse and funding uncertainty could occur. 

Resource: Nixon Peabody | Potential impact of a government shutdown on affordable housing

Recommended Actions for Your Team

  1. Review Contract & Renewal Milestones
    Confirm upcoming items such as HAP renewals, OCAF adjustments, rent schedules, and compliance deadlines, allowing extra lead time for agency processing.
  2. Plan for Administrative Delays
    Stress-test cash flow against possible 2–6 week delays in payment timing rather than outright funding suspension, and prepare contingency plans for January 30 and beyond.
  3. Assess Financial Reserves and Obligations
    Update risk assessments to reflect reduced near-term risk but continued uncertainty around late January. Verify reserve levels and any covenant obligations with lenders or investors.
  4. Communicate with Residents and Partners
    Let residents know that funding has resumed under temporary measures. Be transparent that some tasks like inspections, recertifications, or approvals may still move slowly as agencies work through the backlog.

HUD Public Housing Shortfall Funding Summary (Notice PIH 2025-30)

What it is: HUD is making $25 million available in 2025 to help public housing agencies (PHAs) that are running low on funds or at risk of running out of money.

Who can get it?

  • PHAs with less than three months of operating reserves.
  • Smaller PHAs (fewer than 250 units) get priority.
  • PHAs that already got shortfall funding in 2022–2024 can’t get 2025 funds.
  • MTW PHAs can apply if past flexibility didn’t reduce their reserves.
  • Projects that converted to RAD are not eligible.

How to apply:

  • Submit a simple application through the Public Housing Portal.
  • Only the executive director needs to sign it.
  • Deadline: 5:00 p.m. ET, January 16, 2026.

How funding is given:

  • PHAs are grouped by size and receive money in two steps:
    • Tier 1: Fixes negative reserves so the PHA isn’t in the red.
    • Tier 2: Brings reserves up to three months of operating expenses.
  • PHAs can access the funds as needed to cover immediate costs.

What the money can be used for:

  • Same types of expenses as regular Operating Funds.
  • PHAs report spending monthly and track funds per project.

Timeframe:

  • Funds can be used from award date through December 31, 2029.
  • Any money left after 120 days past that date will be taken back by HUD.

Appeals:

  • PHAs can appeal if HUD used wrong data or if they’re blocked due to prior funding (three-year lockout).
  • Appeals go through the Public Housing Portal and may need an improvement plan.

Reporting and Compliance:

  • PHAs must report monthly.
  • Standard accounting rules apply.
  •  HUD will introduce new reporting tools in the future.
     

How MRI Software is Supporting You

  • We continue to monitor HUD and congressional updates closely and will alert you to any changes that could affect subsidy payments or program operations.
  • Our Product, Account Management and Support teams are prepared to support you during the transition back to normal agency operations.
  • If another funding gap becomes likely as the January 30 deadline approaches, we will provide updated guidance and scenario modeling resources.

For the latest on federal funding of housing and community development programs, please consult Industry organizations like NAHRO.

MRI Software's Strategic Response

In light of these developments, MRI Software is committed to supporting our clients in navigating the evolving housing landscape. Our solutions are designed to enhance operational efficiency and reduce dependency on federal funding:

  • PHA Pro: Streamlines public housing authority operations, improving management and compliance.
  • MRI Affordable Housing: Facilitates the development and management of affordable housing projects.
  • Assistance Connect & WaitlistCheck: Enhance communication and transparency in tenant assistance programs.
  • Secure Sign & The Work Number: Simplify documentation and verification processes.
  • MRI Energy & Accounting Services: Optimize energy usage and financial management.

These tools are not merely supplementary; they are essential for housing agencies aiming to maintain service levels amidst funding uncertainties.

For more information on operational best practices and software products helping MRI clients navigate the federal funding uncertainty, read our latest blog: A Strategic Ascent for Affordable and Public Housing Organizations Amid Federal Budget Challenges.

Stay Informed

For ongoing updates and detailed analyses, consider following reputable sources such as the National Low Income Housing Coalition and Novogradac. These organizations provide in-depth coverage and expert insights into housing policy and funding developments.

Should you have questions or need further information on how these changes may affect your operations, please do not hesitate to contact us.