Unraveling the Myth of Funding Windfalls: Homelessness Appropriations in FY27 and Beyond

Over the last few decades, Congress has consistently increased funding for homeless services, enabling providers to offer crucial housing opportunities and services. Yet, those on the frontlines – while grateful for these investments – know firsthand that they are insufficient to meet the crisis; nationwide, providers can only able to offer permanent housing to an estimated 16 percent of people in their shelters. In significant part, these funding windfalls are simply helping providers keep up with inflation. 

Over the last 10 years, homeless services funding nearly doubled (increasing by 96 percent).  Although critics have expressed frustration and impatience with this spending, these investments have been severely hampered by inflation.  As prices increase over time, the same funds have less purchasing power.  After accounting for inflation, the 96 percent increase in homelessness funding really only amounts to a 43 percent boost.   

Further, per-person appropriations are low. In 2022, the federal government invested an annual average of $1,829 per person served in a temporary shelter or permanent housing placement.  This is less than one month’s rent for a two-bedroom apartment (at the national average). Unfortunately, the growth of this per-person funding amount is even more sluggish than the inflation-adjusted growth in funding.

Since inflation is limiting the impacts of increases in federal funding, there is a need for far more aggressive investments to actually end homelessness.  In the coming months, Congress will be working to fund homeless assistance grants for Fiscal Year 2027. To stay on top of developments and contribute to the process, sign up for the Alliance’s action alerts.