The next year could be a hard one for D.C. residents who rely on the city budget for support with housing, health care, and other services.
D.C. Mayor Muriel Bowser released her $21.8 billion proposed budget for the 2026 fiscal year on May 27 after months of delays. The Bowser administration said the budget’s focus is “growing our economy; rightsizing spending, and investing in our shared priorities.” But housing advocates from organizations like the D.C. Fiscal Policy Institute and Washington Legal Clinic for the Homeless say they worry the proposed budget, which cuts welfare, Medicaid, and housing programs, seeks economic growth at the expense of the city’s most vulnerable.
The District faces a difficult financial future, elected officials say, not only due to a $1.1 billion hole Congress created in the current fiscal budget but because of an expected future $1 billion shortfall in 2029 resulting from the loss of 40,000 federal jobs, according to February projections by the city’s chief financial officer. Bowser’s budget bets on stirring much-needed economic growth through providing tax cuts to businesses, changing laws she believes hinder development, and investing millions of public dollars to return the Washington Commanders to RFK Stadium, with hopes the resulting growth allows D.C. to keep funding social programs. For Bowser, the proposed budget is an effort to cut what she sees as unsustainable programs, keep taxes low, and spur growth now, so the city isn’t stuck in a cycle of asking taxpayers for more money every year to balance the budget.
“You won’t find anywhere in this region the types of homeless services that we offer in the District of Columbia,” Bowser said at a press conference for the budget’s release. “And if we are to maintain those, we have to have more businesses, more people, more people paying taxes.”
The budget now goes to the D.C. Council, several members of which have expressed concern about it. Councilmembers like Ward 3’s Matthew Frumin and Ward 7’s Wendell Felder, for instance, recognized that with the budget challenges, some programs must be prioritized over others. But they say the budget should be viewed through its impact on low-income residents.
“We know when our wealthy and middle-class families catch a cold, our most low-income and vulnerable residents catch the flu,” Felder said at the budget oversight hearing for D.C.’s Department of Human Services (DHS) in late May. “And it is in that context that we must evaluate how the proposed cuts will impact our most vulnerable residents.”
So what programs could lose funding, and which D.C. residents could lose services as a result of the cuts? Bowser’s budget proposes changes to eligibility for Temporary Assistance for Needy Families (TANF), commonly referred to as welfare, and Medicaid, removing people from both programs. It would also cut the Emergency Rental Assistance Program (ERAP) and a legal fund for low-income residents who need representation due to crises such as eviction or domestic violence, services the city’s poorest residents benefit from. Bowser, however, didn’t frame these changes as cuts, but “rightsizing” these programs and services.
In Bowser’s budget, TANF recipients in D.C would see stricter job search requirements and sanctions for not meeting them, and would not receive a cash assistance increase to account for inflation. The program would also no longer support adults who’ve been in the program for longer than 60 months starting in fiscal year 2027. The work requirements will impact the 14,623 households receiving TANF benefits, according to the most recent data on TANF beneficiaries presented by DHS at a March public oversight hearing. There are approximately 6,500 households that have received TANF for greater than 60 months, according to DHS in a statement to Street Sense.
“DHS will work with the community to develop a hardship policy, which would allow eligible households to continue to receive benefits and services beyond the 60-month time limit,” a DHS spokesperson wrote in a statement.
The proposed changes to Medicaid eligibility would make childless adults and adult caregivers whose income is $21,597 or above — 138% of the federal poverty level — ineligible for Medicaid. The mayor’s office expects the change to impact over 25,000 people. Bowser said these residents would be eligible for a new, less expensive basic health plan, but it’s not yet clear what the premiums or copays would be under the program.
The Health Care Alliance Program, a program that offers health insurance to D.C. residents regardless of immigration status, would also be phased out over the next four years under Bowser’s proposal. That would result in 27,000 people losing health care coverage, in an effort to save the city $48.1 million in fiscal year 2026 and $457.4 million throughout the financial plan, according to the city’s fiscal impact statement. In another blow to the local immigrant community, the budget would also defund the Office of Migrant Services, a $39.8 million cut.
In housing, Bowser’s proposal cuts ERAP, a heavily sought-after rental assistance program for people facing emergencies, by $21.9 million. Bowser has repeatedly proposed cutting the program, which she argues some people take advantage of, though the D.C. Council often has worked to restore funding. The program was in such high demand that applications for assistance closed after just one day last year.
Bowser defended her proposed cuts by pointing to other spending on homelessness prevention, including one-time allocations of $18.9 million to support D.C.’s Continuum of Care, which offers a range of services through various agencies to meet the needs of families and individuals who are experiencing or at risk of experiencing homelessness; $3.5 million to support homeless shelter operations; $13 million to support Short Term Family Housing program; and $9.8 million to support the Family Re-housing Stabilization Program division at DHS.
Despite the infusion, the budget would reduce yearly operating revenue by $16.8 million from Rapid Rehousing for families, $3.3 million from Permanent Supportive Housing for individuals, and $7.1 million from the D.C. Housing Authority’s affordable housing program. The 2026 fiscal budget includes a $56.9 million cut from the D.C. Department of Human Services overall.
“We’re looking at an incredibly regressive budget,” said Washington Legal Clinic for the Homeless Executive Director Amber Harding. “Regressive to the point of erasing the progress these same decision makers, including Mayor Bowser, have made over the years.”
According to the fiscal impact statement, the vision for the Rapid Rehousing program is to “reduce net agency spending in fiscal year 2027 by $19.7 million and $56.9 million over the four-year budget and financial plan, by either reducing the number of clients served overall, or by directing them to less expensive programs.” While Rapid Rehousing has faced criticism for its failure to lead to sustainable housing, it’s also a program thousands of D.C. residents have used to move out of shelters.
The less expensive program would be DC Flex, which offers families $8,400 to spend per year on rent for four years. The other cost-saving measure mentioned in the budget is Bowser’s proposal to reinstate the city’s ability to place families in congregate shelters, a change from a policy to place families in apartment-style or private shelters.
Harding points to the reductions around paying for housing during Rapid Rehousing appeals and reversing policy preventing families from being put in congregate shelters as examples of how the mayor is backsliding on her promises.
“Mayor Bowser is the one who closed D.C. General, and now she’s proposing to create a new D.C. General in the law,” said Harding. “The problem with D.C. General was that it allowed for congregate placements of families, and it was really dangerous and unsafe.”
The council will hold budget hearings over the next month and is scheduled to vote on the budget at the end of July.
This article originally appeared in Street Sense’s June 4, 2025 edition.
