December 8, 2025
Author: Nicole Newhouse (Executive Director, AZHC)
When you hear about housing and homelessness funding, it’s easy for eyes to glaze over. Budget Reports. Grant programs. Acronyms stacked on acronyms.
But here’s the thing: money tells a story. And right now, Arizona’s housing funding story reveals some important truths about what we’re building—and what we’re not.
The Arizona Housing Coalition just released a comprehensive fiscal review tracking every major dollar flowing into Arizona’s housing and homelessness system during 2024. No advocacy spin. No predetermined conclusions. Just a clear-eyed look at where the money comes from, where it goes, and what that means for communities trying to plan ahead.
Here’s what we found…
The Big Picture: Nearly $1.3 Billion in 2024
Arizona’s housing and homelessness system was supported by approximately $1.3 billion in 2024:
- $890 million from HUD (federal)
- $418 million from state sources
That sounds like a lot. And it is. But when you look closer, some important patterns emerge.
Important Note: This review focuses specifically on housing funding streams. It does not catalog the federal dollars that flow through Health and Human Services agencies—including SAMHSA, HRSA, and CMS—which AHCCS receives to support wraparound services like behavioral health and substance use disorder treatment, case management, and medical care. Those services are critical to housing stability, but tracking them requires a separate analysis.
Five Things the Numbers Show
- Two-thirds of federal dollars go to one program
- Out of HUD’s $890 million to Arizona, $388 million went to Housing Choice Vouchers—including $351 million specifically for veterans through HUD-VASH. Vouchers are essential. They help people afford rent in the private market. But they only work if housing actually exists and landlords accept them.
- The punchline: We’re investing heavily in helping people search for housing, but far less in creating new housing to find.
- State funding swings wildly from year to year
- Arizona’s Housing Trust Fund received $60 million in 2023, $150 million in 2024 (historic high), and $15 million in 2025. Meanwhile, the state created a Low-Income Housing Tax Credit in 2021, funded it for four years at $4 million annually, then let it sunset in 2025—making Arizona the first and only state to launch a state housing tax credit and then discontinue it.
- The punchline: It’s hard to build a pipeline when the funding turns on and off like a faucet.
- Most money goes to short-term assistance, not long-term supply
- Programs that maintain affordability—like vouchers, emergency shelter, and rapid rehousing—receive the bulk of funding.
- Programs that expand the housing supply—like HOME, Housing Trust Fund, and tax credits—receive a fraction by comparison.
- The punchline: We’re working harder every year to help people compete for housing that doesn’t exist in sufficient supply.
- Health and housing dollars are deeply intertwined
- Arizona invested $130 million in housing tied to behavioral health services:
- $65 million for AHCCCS Housing Program (Medicaid-funded)
- $65 million for Non-Medicaid Behavioral Health Supported Housing
- This reflects an important recognition: housing stability and health outcomes are inseparable.
- The punchline: When federal health funding rules change, housing programs feel it immediately.
- Arizona invested $130 million in housing tied to behavioral health services:
- We are flying without a clear dashboard
- While many programs require data collection through the Homeless Management Information System (HMIS), there’s no standardized way to measure success across all the different funding streams. Different agencies. Different metrics. Different reporting timelines.
- The punchline: We’re spending over a billion dollars without a shared scorecard.
Why This Matters Right Now
This fiscal review arrives at a moment of significant transition:
- The U.S. Interagency Council on Homelessness, which coordinates 19 federal agencies, has been effectively paused by executive order
- HUD has released major changes to how communities can use Continuum of Care funding
- Federal behavioral health grant rules are evolving
- Arizona’s state housing tax credit is set to sunset on December 31, 2025
None of this happens in a vacuum. When federal priorities shift or state funding disappears, the ripple effects touch:
- Tribal housing authorities
- Rural service providers
- Behavioral health agencies
- Emergency shelters
- Schools serving homeless students
- Hospitals managing housing-related health crises
- Law enforcement responding to street homelessness
Communities need predictable funding and reasonable transition time to adapt without disrupting the supports people rely on.
Three Big Takeaways
“Show us the dollars and we’ll show you the vulnerabilities.”
Arizona’s heavy reliance on federal funding—especially programs subject to annual appropriations or shifting priorities—creates systemic fragility. When those dollars change, the entire system feels it.
“We’re maintaining affordability, not expanding supply.”
The current funding mix keeps people housed today, but doesn’t create the units we’ll need tomorrow. Without more investment in production, we’re running on a treadmill.
“Volatility undermines planning.”
Developers, tribes, nonprofits, and local governments can’t build long-term solutions when funding appears and disappears unpredictably. Stability matters as much as the dollar amount.
What’s Next
This fiscal review is part one of a two-part series.
Coming Next: A statewide literature review examining what research tells us about which housing and homelessness strategies actually work—and for whom.
Together, these reports aim to provide Arizona’s communities, policymakers, and partners with the information they need to make smarter, more coordinated decisions about housing.
The report includes:
- Detailed breakdowns of every major federal and state program
- State-by-state context on housing tax credits
- Historical funding trends for Arizona’s Housing Trust Fund
- Program-by-program outcome data where available
The Bottom Line
Arizona’s housing funding system is substantial but structurally fragile—marked by heavy federal dependence, volatile state support, and an emphasis on short-term affordability over long-term supply.
Understanding these patterns doesn’t solve the problem. But it’s a necessary first step.
Because you can’t fix what you don’t see. And now, the picture is a lot clearer.
The Arizona Housing Coalition is a statewide network working to increase housing stability and reduce homelessness across Arizona. This fiscal review was developed by Endeavor Together and reflects calendar year 2024 funding data from federal and state sources.