With the One Big Beautiful Bill Act (OBBBA) now enacted, attention in Washington has turned to appropriations for fiscal year 2026. Programs important to real estate—like HUD’s rental assistance program, and EPA’s ENERGY STAR program—are navigating the annual federal spending process, as Congress must pass legislation by September 30 to avoid a government shutdown.  (Roll Call, July 18)

HUD Programs

• The House Appropriations Committee passed a bill on Tuesday to fund HUD in FY’26. (Bill text | Summary). The measure will next proceed to the full House of Representatives for a vote. (Press Release, July 17)

• Under the bill, HUD would get about $67.8 billion in discretionary funds, a $939 million decrease compared to FY 2025.

• Section 8 project-based rental assistance would receive a $237 million increase over FY 2025 levels, totaling $17.127 billion. According to the committee, the funding would support full renewal of contracts for roughly 1.2 million households.

• This stands in stark contrast to President Trump’s FY 2026 “skinny budget” released in May, which proposed a $26.7 billion (43%) reduction to Section 8. (Bipartisan Policy Center, June 11)

• Despite the funding gains for rental assistance, the bill includes a 26% cut to HUD staffing—raising concerns about the agency’s capacity to manage and deliver programs efficiently. (PoliticoPro, July 9)

EPA Programs

• A separate House appropriations subcommittee also passed a bill on Tuesday to fund EPA for FY’26. (Bill text | Summary). The bill proposes no specific cuts to ENERGY STAR. The program receives strong support from RER in partnership with a broad coalition of national real estate, manufacturing, retail, and technology industry groups. (Roundtable Weekly, June 6).

• The measure proposes $2.27 billion for EPA’s environmental programs in FY’26, representing a 29% cut compared to current fiscal year funding. (Summary)

Supreme Court Ruling Upholds Agency Reorganizations

• Ultimate FY’26 spending levels will be impacted by agencies’ internal plans to reorganize and eliminate programs. An 8-1 decision by the U.S. Supreme Court last week allows the Trump administration to move forward with large-scale staff reductions and structural overhauls across 19 federal departments. (Reuters, July 9)

• The high Court’s ruling states that any specific reorganization effort could be deemed illegal, while confirming the President’s general authority to direct agencies to develop “RIF and Reorganization Plans” by September 30 in accord with a “DOGE” Executive Order and White House memo both issued in February.

• Moving forward with EPA’s planned restructuring, Administrator Lee Zeldin on Thursday announced further reorganization by consolidating finance and administrative offices, changing enforcement and Superfund offices, and continued workforce reductions through early retirements and layoffs. (PoliticoPro, July 17)

• Reports thus far of Zeldin’s plans do not identify any planned cuts to ENERGY STAR or the larger division in which it is housed at the agency.

• Advocacy by RER and coalition partners to the administration and Congress explains that ENERGY STAR’s continued success as a non-regulatory, public-private partnership depends on sufficient staff and budget resources to implement the program.

What’s Next

• Rescissions: Congress may consider further efforts to rescind unspent prior-year funding, similar to the bill passed this week and now heading to the President’s desk clawing-back $9 billion in previous funds for foreign aid and public media. (POLITICO, July 18). 

• More Tax Legislation?: According to the House speaker’s top tax aide, Congress may pursue a bipartisan tax package, additional retirement policy changes, and a follow-up reconciliation bill informally dubbed “2 Big 2 Beautiful.” (Tax Notes, July 17)

• Section 899: Republican tax leaders Rep. Jason Smith (R-MO) and Sen. Mike Crapo (R-ID) have signaled they may reintroduce the Section 899 retaliatory tax if negotiations to exempt U.S. companies from OECD Pillar 2 taxes fail, potentially in a second reconciliation bill (Tax Notes, July 17). However, Germany’s Finance Minister Lars Klingbeil reaffirmed his country's commitment to implementing Pillar 2 of the global minimum tax, despite widespread uncertainty following recent U.S. tariff announcements and the G7 carveout exempting American companies. (PoliticoPro, July 18)

• FY’26 Appropriations: Senate Majority Leader John Thune has not yet decided whether to bring a government funding bill to the floor next week but aims to pass at least one funding package before the Senate’s August recess. (PoliticoPro, July 17) If congress does not pass FY’26 spending legislation by September 30, it could default to a stop gap “continuing resolution” and extend FY’25 levels to keep the government running.

• Agency Restructurings: Reorganizations plans prompted by DOGE efforts will continue to be unveiled before and after Labor Day.

RER will continue to monitor all developments on matters of tax, appropriations, and federal agency reorganizations relevant to real estate.