The 2025 fiscal year ended on Sept 30. The Antideficiency Act prohibits federal agencies from obligating any money without an appropriation from Congress. Any period when appropriations are not enacted into law, either through regular appropriations bills or a continuing resolution, is known as a “funding gap.”
This gap results in a partial federal government shutdown. The federal government shutdown officially began on Oct. 1, and it is still to be determined how long it will last.
CAI’s 2025 Congressional Advocacy Summit Status – As of Oct. 1
Congress remains open and functions as normal during the government shutdown. CAI’s 2025 Congressional Advocacy Summit will be held as planned on Nov. 6. CAI is closely monitoring the shutdown and will notify attendees if any adjustments to the summit need to be made. We look forward to seeing members in Washington D.C., next month.
However, the current shutdown does impact several federal agencies and programs important to community associations. Homeowners and buyers, board members, community managers, attorneys, and other business partners may notice delays in flood insurance policy changes, disaster response expectations, condominium loan certification, communications infrastructure fixes, and more.
Federal Emergency Management Agency and the National Flood Insurance Program
Some FEMA staff are furloughed, and several FEMA functions will be halted, delayed, or slowed. FEMA is not annually funded and receives its funding through Congress’ annual appropriations process. The shutdown does not impact FEMA’s response to presidentially declared disasters. However, disaster relief and aid to communities and homeowners could be potentially delayed if needed during this time.
NFIP, which millions of homeowners use to protect against costs from storm damage to their properties, lapsed along with government funding with the federal shutdown. Current federal flood insurance policies will exist until funds run out; new policies will not be issued until the shutdown ends.
Policy consideration and movement will be delayed.
Federal Housing Finance Agency and Freddie Mac and Fannie Mae
FHFA federal employees deemed nonessential may be furloughed during this shutdown. However, condominium loans through Freddie Mac and Fannie Mae are private loans and should continue during this shutdown.
Policy consideration and movement also will be delayed.
Department of Housing and Urban Development and the Federal Housing Administration
Some HUD staff are furloughed, halting or slowing several HUD functions including condominium project certification approvals and renewals. When the shutdown ends, a delay in processing may be expected due to a backlog causing additional limitations to buyer financing options.
According to FHA, the following activities will be available during the shutdown, but with limited FHA staff availability and longer waiting times for assistance:
- Condominium Project approvals under the Direct Endorsement Lender Review and Approval Process (DELRAP);
- Manual pre-endorsement actions: resolution of the Holds Tracking queue (including case number assignments for Single-Unit Approval condominiums); case number transfers, cancellations, and reinstatements for cases that the mortgagee cannot process in FHA Connection and require FHA staff intervention;
- Submissions of Upfront Mortgage Insurance Premiums (UFMIP) for new endorsements;
- Insurance endorsements for Title II Forward mortgages, including Notice of Return (NOR) resubmissions.
The following activities will be unavailable for the duration of the shutdown:
- Condominium Project approvals under the HUD Review and Approval Process (HRAP);
- Endorsement of Home Equity Conversion Mortgages (HECM);
- Endorsement of Title I loans;
- Endorsement of Test Cases;
- Pre-Closing Review and Endorsement of HUD employee loans; and
- Mortgage Insurance Certificate (MIC) corrections.
Community associations also should be aware that grant programs including community development block grants and disaster recovery funds through HUD and FHA could potentially be paused during the shutdown.
FHA operations relate to foreclosure and foreclosure prevention. HUD-owned property sales will continue as normal. Maintenance and security activities at HUD-owned properties also will continue as normal during a shutdown.
Policy consideration and movement also will be delayed.
Federal Communications Commission
Some FCC staff are furloughed, and several FCC functions are either halted or slowed. The shutdown may stall or halt resolution of federal communications infrastructure including broadband and satellite. It also may stall or halt processing of new and renewal licensing applications, including drones
Policy consideration and movement also will be delayed.
Social Security Administration
The U. S. Social Security Administration’s work including social security payments falls under mandatory government spending and will continue. Homeowners who utilize social security payments to assist with association assessments should plan to continue to receive their social security payments.
CAI’s government and public affairs team continue to monitor the government shutdown and its impact on community associations. We will share more information as it becomes available.
Please contact us at government@caionline.org with any questions.