STATE BUDGET UPDATE: Appropriations Committee Proposes Increases to Governor's Budget Recommendation, Yet Falls Short of System Needs

Dear Advocates,

The Appropriations Committee released its proposed FY26–FY27 budget this week, sending it to the full legislature and into coming negotiations between legislative leaders and Governor Ned Lamont before final votes are held in the state House and Senate.

The Takeaway:

We are grateful and encouraged that the Appropriations Committee built upon the funding originally recommended in the Governor’s budget. Funding for cold weather shelter, CAN Hubs, and eviction prevention was provided, but the increase in the Committee budget is only half of what we are advocating and total funding falls short of what we need to fund Connecticut’s Homeless Response System—especially when many of you are reporting up to a doubling in demand.

By the Numbers

1. CAN Hubs & Diversion Services & Eviction Prevention:

• Our Ask: $5.5 million for CAN Hub & Diversion Services and $5.3 million for the Eviction Prevention Partnership—a total of $10.8 million in annual funding to sustain and strengthen Connecticut’s Homeless Response System, annualized.

• Governor’s Budget: $5 million in both FY26 and FY27 for combined support of Eviction Prevention and CAN Hub & Diversion Services.

• Appropriations Committee Budget: $3.5 million in FY26 and $5 million in FY27 for combined support of Eviction Prevention and CAN Hub & Diversion Services.

• Summary: With the temporary federal ARPA funding that helped sustain these services due to expire by September 2025, the legislature needs to fully fund our $10.8 million request to preserve and strengthen this essential safety net.

Funding for CAN Hub & Diversion Services and Eviction Prevention are complementary—but distinct, and should not be lumped together. Eviction Prevention supports those at risk of losing their housing, while CAN Hubs serve those already in acute crisis—connecting more than 21,000 people each year to shelter, housing, and support services.

2. Flexible Funding:

• Our Ask: $2.5 million, annualized.

• Governor’s Budget: None.

• Appropriations Committee Budget: None.

• Summary: This vital program provides short-term financial assistance to individuals on the brink of homelessness, including young people on their own.

3. Cold Weather Emergency Response Program

• Our Ask: $5 million, annualized.

• Governor's Budget: $4.5 million in FY26 / $4.5 million in FY27, through the Opioid Settlement Fund.

• Appropriations Committee Budget: $3.5 million in FY26 / $5 million in FY27, through the General Fund.

• Summary: These proposed cuts remove access to life-saving services during the winter months. Currently 1 in 4 people are being turned away from these services, with some warming centers reporting a doubling in demand. Without consistent, annualized support, our system will not be able to meet the rising need.

CT CAN End Homelessness requested $5 million in annualized funding to maintain and expand cold weather shelter capacity statewide. In the face of growing demand, anything less will leave lives at risk.

4. Homeless Response Services

• Our Ask: $9 million, adjusted and indexed for inflation.

• Governor’s Budget: Included as part of a broader $10.3 million increase in FY26 and $10.5 million in FY27.

• Appropriations Committee Budget: Mirrors the Governor’s proposal, with increases spread across several line items - Congregate Facilities Operations Costs, Elderly Congregate Rent Subsidy, Housing/Homeless Services, and Project Longevity.

• Summary: We are grateful to see increased investment reflected across these line items; however, funding for the Homeless Response System must not be diluted or lost within broader budget categories. Connecticut’s homeless service providers have been chronically underfunded, resulting in staffing shortages, rising operational deficits, and reduced capacity to serve those in crisis.

To stabilize the system, meet the real cost of service delivery, and preserve a functioning crisis response infrastructure, the state must provide $9 million in funding specifically for Homeless Response Services—adjusted and indexed to inflation—to reflect increased housing and operational costs.

5. Case Management for Permanent Supportive Housing

• Our Ask: $6.2 million.

• Governor’s Budget: $2.3 million in FY26 / $4.1 million in FY27, through the Opioid Settlement Fund.

• Appropriations Committee Budget: $562,550 in FY26 / $4.1 million in FY27, through the General Fund.

• Summary: While we appreciate the Governor and the Appropriations Committee funding case management, we need the full $6.2 million for case management for Permanent Supportive Housing (PSH). The Appropriations Committee proposed funding combines 24/7 mobile crisis services for adults and wraparound services for 125 recipients of supportive housing. Even if it were not already combined with mobile crisis funding, this recommendation would not meet the need for stabilizing services in supportive housing.

Make Your Voice Heard!

Now is the time to reach out to your legislators, who can influence whether the budget will be sufficient to cover the needs of the Homeless Response System.

We began the session with a specific request for $33.5 million for the Homeless Response System, that is the level of funding we still need. Tell your legislators that we appreciate the steps the Appropriations Committee took, and but that we need the full funding request to ensure the long-term stability and strength of Connecticut's Homeless Response System in FY 2026, with an adjustment for inflation thereafter. 

You don’t need to be a budget expert—you are a homeless response expert who can describe to them what you are doing to house the people they represent. We will back you up with the numbers, but no one else can make the case with your level of knowledge and passion.

If you have any questions, please contact Katherine Whitney at kwhitney@cceh.org. 

Thank you all for the incredibly important work that you do.

Sincerely,

Sarah Fox, CEO

Connecticut Coalition to End Homelessness