Bellingham sees declining trend in federal funding for affordable housing, services
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The city of Bellingham received less federal funding this year to support local public services including affordable housing development, home buyer and rental assistance, and homeless support programs.
The decline in federal funds from the U.S. Department of Housing and Urban Development (HUD) has become a trend in recent years, highlighting the need to diversify the city’s funding pool with state and local sources to continue supporting community services.
The city saw a steady increase in HUD funding every year from 2017 to 2022, capping at about $1.5 million that year.
A trending decline
In 2023, Bellingham received about $1.46 million from HUD, a decline from 2022 funding numbers. In 2024, the city received about $1.33 million — a further funding decline.
To put this into perspective, this funding reduction equates to five fewer homeless families being supported with rental assistance and one less low-income senior being supported with housing, according to Bellingham Housing & Services Program Manager Samya Lutz.
“We are disappointed that this funding is a reduction in federal resources through these programs,” Lutz said in an email to The Bellingham Herald.
Leveraging funding pools
Despite the trending reduction in federal funding, the city will pair it with other sources to support needed community services.
The city is “committed to put these important resources to use by leveraging them with the local funds we receive thanks to the generosity of Bellingham residents,” Lutz said.
The Bellingham Housing Levy and Affordable Housing Sales Tax total about $7.5 million each year that is put toward housing and services.
“We are also thankful our state continues to invest resources into housing and services that support many of the same projects and programs the City is committed to,” Lutz told The Herald. “We work within a remarkably collaborative region, with all funding partners working to build the capacity of nonprofit agencies and housing developers to do as much as we can together within the resource constraints we have.
Where will the money go?
HUD has historically allocated funds to Bellingham from the Community Development Block Grants (CDBG) and the HOME Investment Partnerships Program (HOME). CDBG funding can support a wide variety of public services and community activities while HOME funding is meant to help produce and maintain affordable rental and owner-occupied housing for low-income families.
“Bellingham’s use of both CDBG and HOME funding must be consistent with the goals and priorities laid out in our Consolidated Plan,” Lutz said.
The city is required to create a consolidated plan every five years as a condition of receiving this federal funding. The plan assesses the city’s community development needs and analyzes the housing market for low-income households. It also presents the goals, strategies, and specific actions implemented yearly to address those needs.
The consolidated plan is the community’s choice, within HUD parameters, for how the grant funds will be used in the city, according to the city’s website.
The plan outlines the intent to use federal CDBG funds for home rehabilitation, acquisition of land and facilities for affordable housing and shelter, and community facilities. It is also intended to support public services like the food bank. Federal HOME funds are intended to be used for affordable housing development, the homebuyer program, and rental assistance.
