Housing Resources in Connecticut’s Biennial Budget (2026-2027)

CONNECTICUT GENERAL ASSEMBLY AND GOVERNOR LAMONT COMMIT SUBSTANTIAL RESOURCES FOR HOUSING IN CONNECTICUT’S STATE BUDGET FOR FISCAL YEARS 2026 & 2027

This week, the General Assembly adopted a budget and bonding package that includes $1.074 billion in capital support to the Department of Housing for housing development and assistance, signaling a strong commitment to housing affordability, with Governor Lamont expected to sign the legislation soon. The Partnership for Strong Communities has long advocated for comprehensive, data-driven solutions to Connecticut’s housing challenges. This budget marks a significant step forward in ensuring that all residents—regardless of income or zip code—have access to safe, stable, and affordable housing.

 

“We commend the legislature and the governor for recognizing the urgent and growing need for more affordable homes. This budget clearly reflects their commitment to making housing more accessible for families across Connecticut,” said Chelsea Ross, Executive Director of Partnership for Strong Communities. “We are especially pleased to see their recognition of the impact of rental assistance and the need to expand the program to serve more families,” Ross said.

 

Specifically, the Connecticut legislature passed H.B. 7287, An Act Concerning the State Budget for the Biennium Ending June 30, 2027, detailing appropriations and revenue (the budget bill), and H.B. 7288, An Act Authorizing and Adjusting Bonds of The State, which details bonding (the bonding bill). The budget bill proposes $27.2 billion in spending in FY 26 and $28.6 billion in spending in FY 27. The biennium budget includes critical new resources to create and preserve affordable housing which are detailed below.

 

Department of Housing (DOH) 

• Overall, the budget offers a significant increase to the Department over previous year funding, reflecting a 31% increase ($36.7M) in FY26 over FY24 and a 48% increase ($55.2M) in FY27 over FY25.

• Housing/Homeless Services line is funded at $101,123,923 in FY26 and $114,323,923 in FY27. This is an increase of $8.5M and $26.4M in each year of the biennium over the FY 24-25 budget, representing a 9% and 30% budget increase, respectively. The legislature also appropriated an extra $18M to this line item for immediate use in FY25. The Rental Assistance Program (RAP) is the largest expenditure in this budget line. The bill text also approves up to $3.5M in FY26 and $5M in FY27 for use for cold weather emergency response systems.

• Housing/Homeless Services to municipalities line is funded at $692,651 in each year of the budget, representing a $17,242 increase each fiscal year.

• DOH’s budget for personal services has increased by approximately $270Kin each year of the budget, as well as an extra $250K for immediate use in FY25. This increase likely reflects at least one new position as requested by the Governor for the department’s Asset Management Unit to monitor the state portfolio of affordable housing and support record retention requirements. The legislature also appropriated an additional $85K annually above what was requested in the Governor’s budget, which may reflect the addition of a second position in the department. 

• New bond authorizations
  
  • $200M in each year of the biennium for housing development and rehabilitation projects.
  • $150M in FY26 and $150M in FY27 to the Housing Trust Fund (HTF) for workforce housing projects.
  • $60M in each year of the biennium for the Time to Own program.
  • $5M in FY27 for grants or forgivable loans to Time-To-Own recipients for unanticipated capital improvements to their newly purchased homes.
  • $10M in each year of the biennium for the “Homes for CT” program.
  • $50M in each year of the biennium for a middle housing development grant program to public housing authorities in municipalities with a population of 50,000 or less.
  • $6M in each year of the biennium for grants to landlords who provide housing to formerly incarcerated individuals.
  • $2M in FY26 to fund the new Affordable Housing Real Estate Investment pilot program (PROPEL CT).
  • $20M in FY26 for a homeownership initiative through Community Development Finance Institutions.
  • $10M in FY26 for grants for supportive housing for persons with intellectual disability or other developmental disabilities.
  • $50M to finance projects to create employment opportunities in the construction industry by developing affordable housing, in the amount of $12.5M per year for FY26 through FY29.
  • $100M additional bond authorizations for the Crumbling Foundations Assistance Fund, in the amount of $25M per year for FY27 through FY30.

• Increases the limit of funds from Housing Receivership Revolving Fund that can be expended in a single municipality from $1M to $5M.
• The following line items increased their appropriations in FY26-27, mirroring the Governor and Appropriation Committee’s proposed increases to account for provider cost of living adjustments and the impact of increased housing costs on state programs:
  
  • A 40% increase to “Other Expenses” budget line, likely reflecting increases for IT centralization and a proposed $20K/year Norwalk Housing Authority Scholarship Fund.
  • A 3% increase at $80K/annually for the “Homeless Youth” budget line.
  • A 20-24% increase to cover debt service subsidy costs for supportive housing for DSS’s CT Home Care Program for Elders under the “Subsidize Assisted Living Demonstration” budget line.
  • A 12% increase at approximately $1.4M annually for shelter operations under the “Congregate Facilities Operation Costs” budget line.
  • A 9% increase at approximately $170K annually under the “Elderly Congregate Rent Subsidy” budget line.
  • A 10% increase to the new FY24 “Project Longevity” collaborative program to reduce gun violence in urban centers across Connecticut; funding for Norwich ($250K/year) under this initiative was separated into its own budget line, “Outreach Services for Norwich”.
  • A 3% increase at $17K annually under the “Housing/Homeless Services – Municipality” budget line. This reflects the Governor’s proposed budget and does not include the appropriation committee’s suggested $500K each year for shelter services in Willimantic.

 

Office of Policy and Management

• • $200M in each year of the biennium for the Urban Act grant program.

• • $40M in FY27 for the Small Town Economic Assistance Program.

 

Department of Economic and Community Development (DECD) 

• New bond authorizations
  • $40M in each year of the biennium for the Brownfield Remediation and Revitalization program.
  • $20M in FY26 and $30M in FY27 for the new Greyfield Revitalization program to provide grants or loans to facilitate repurposing greyfield commercial retail and office space. A greyfield is defined as a previously developed commercial property that is economically nonviable and exhibits conditions that complicate redevelopments
  • $30M to provide grants for infrastructure in rural areas to support the development of housing or economic development.

• Expands the municipalities that are eligible for the Community Investment Fund (CIF) to include distressed municipalities. Previously, eligibility was limited to municipalities designated as a public investment community or an alliance district.

• Reduces existing bond authorizations for CIF in FY26/FY27 from $175M each year to $121M annually.

 

Capital Region Development Authority (CRDA)

• • $31M in new bond authorizations in each year of the biennium to encourage economic development. Eligible projects may include encouraging residential housing development.

• • $20M in new bond authorizations in each year of the biennium in grant-in-aid to East Hartford for economic development activities, including the construction or rehabilitation of housing.

 

Connecticut Municipal Development Authority (CMDA)

• • $30M for ongoing capitalization in FY27.

 

Department of Energy & Environmental Protection (DEEP)

• • $100M in FY27 for retrofitting multifamily housing in environmental justice communities or alliance districts.

• • $20M in each year of the biennium for the Urban Brownfield Remediation Program.

 

Connecticut Judicial Department

• • Foreclosure Mediation Program is funded at $2,158,656 in each year of the budget.

• • Right to Counsel, previously funded by federal ARPA dollars, was funded at $1.75 in FY 26 and $2.5 in FY 27.

 

Watch for our complete summary of housing bills taken up by the General Assembly this session within the next few days.