The Trump administration has cut funding for a federal rural housing program in half nationwide and by 85% in Wisconsin, ignoring the $1 billion congressional appropriation for the program, Sen. Tammy Baldwin said Monday.

“The Trump administration has the money, but they are making an active choice not to use it and not to invest in rural America,” Baldwin said in a statement issued by her office.

In a statement posted Tuesday and shared with the Wisconsin Examiner Wednesday morning, the U.S. Department of Agriculture tied the shortfall in donations to the “unexpected federal government shutdown that paused operations for several weeks” in late 2025 and defended its performance in carrying out the loan program.

At issue is funding for the USDA Single Family Housing Direct Home Loans program. The program has typically provided financing for about 5,500 mortgages per year for low- and very-low-income residents in rural areas.

Congress rejected a Trump administration proposal to eliminate the program in 2026, according to Senate Appropriations Committee Democrats, and instead approved $1 billion for the program.

By the end of the 2026 fiscal year Sept. 30, however, the administration had spent $518 million, according to the Democrats. Of the remaining funds, $230 million expired with the end of the fiscal year, unable to be lent.  Another $250 million of the appropriation can still be used in the new fiscal year.

In a statement Tuesday, USDA said it provided “$571 million in loans, about 76% of available funds, to help 2,115 families buy homes. The average loan amount was $269,000.”

The loans were made over the course of a nine-month period, USDA said, and “a full 12 months of operations would have reached $762 million.”

The $250 million to be carried over “will be used in FY 2027 to continue supporting homeownership in rural communities,” USDA said.

Senate Democrats also stated that the Trump administration has added “harmful red tape” making loan applications harder.

The USDA statement said the program “strengthened credit screening” and “improved financial literacy support for applicants,” reducing first-year delinquency rates for the loans to less than 2.9%. The agency said it was able to reduce the time it took to assess whether borrowers were eligible to 64 days.

A chart distributed by Baldwin’s office showed that while in past years Wisconsin accounted for an average of more than $13 million in loans annually, that plummeted to $1.98 million in 2026. Both Wisconsin and Connecticut had the steepest drop in loans compared with their past year averages — 85%.

“The price of housing is crushing families and is putting the dream of homeownership further and further out of reach,” Baldwin said. “Instead of helping these folks afford the roof over their heads, the Trump Administration is making matters worse by slashing resources that help working families in our rural communities afford a home.”