The Trump Administration’s FY 2027 budget request, submitted to Congress on April 3, bears considerable resemblance to its FY 2026 request with proposals to cut funding for many of the agencies and line items of most interest to the state and regional innovation community. Congress approved a FY 2026 budget that in most ways mirrored previous years’ allocations for TBED-related programs and priorities, such as R&D.
Appropriators in the House of Representatives have outlined plans to begin their work on their version of the FY 2027 budget beginning later this month.
The following is a summary of budget items from the President’s FY 2027 request that may be of particular interest to the TBED community.
Within the Department of Commerce. there are proposals to eliminate the Minority Business Development Agency (MBDA), the Economic Development Administration, and the NIST Manufacturing Extension Partnership (MEP).
The Department of Commerce narrative accompanying the “skinny budget” states, “The Budget saves the taxpayer nearly half a billion dollars by cancelling EDA programs that are not only wasteful, but also operate as spending earmarks for political pet projects and subsidies for leftist ideologues who promote “racial equity” and the Green New Scam.” The MEP program is described as “an underperforming and unnecessary program that has failed to accelerate America’s manufacturers’ ability to compete in the 21st Century...”
The budget summary table for Commerce, available here, shows the Bureau of Labor Statistics being moved from the Department of Labor to Commerce and the Bureau of Economic Analysis getting a 1% increase.
The National Science Foundation was not included in the “skinny budget” summary document released by the Office of Management and Budget; however, NSF has made a more detailed budget proposal available here. The summary tables for Research and Development Special Analysis reveal a cut of $4.8 billion from the FY 2026 estimate of $8.8 billion. Basic R&D support would see a 58% reduction from FY 2026 levels if enacted, while the cut to applied research would exceed 45%. NSF personnel and related expenses would see further reductions in full-time equivalents totaling 22% from the FY 2025 work plan.
Specific program areas within NSF’s budget that would see significant cuts include the following selected items:
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The Technology, Innovation and Partnerships (TIP) Directorate would be cut by 43.4%. The document provides some insights into the anticipated size of a number of new initiatives recently discussed within TIP, including $50 million each for the Tech Labs, TechXccelerators, and Test Beds programs. Of note, the NSF Engines program would receive only $13.9 million while the I-Corps program would receive $14.1 million.
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NSF’s EPSCoR program is listed as being cut by 56.9%, with co-funding, outreach, and workshop spending lines within EPSCoR being eliminated entirely.
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The Social, Behavioral, and Economic Sciences Directorate would be eliminated. The National Center for Science and Engineering Statistics, which has been within SBES, would operate independently but still experience a 40.6% cut.
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Reductions for other directorates include Geosciences (-58.2%); Computer & Information Science and Engineering (-62.9%); STEM Education (-64.3%); Mathematical and Physical Sciences (-66.7%); Biological Sciences (-71.7%); and Engineering (-74.9%);
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NSF’s Office for International Science and Engineering would be cut by 94.3%.
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If enacted as proposed, the NSF SBIR/STTR program would see a $141 million reduction in funds available for awards.
The budget puts the Department of Education (ED) “on a path to elimination.” The ED budget request is $76.5 billion, a $2.3 billion, or 2.9%, decrease from the FY 2026 enacted level. Proposed higher education programs to be eliminated include those targeting minority-serving institutions. However, federal Pell grants, which provide support for lower-income students to pursue higher education, would receive an additional $10 billion in the proposal.
The budget requests $53.9 billion for the Department of Energy (DOE), a $4.8 billion or nearly 10% increase from the FY 2026 enacted level, excluding the Working Families Tax Cut Act (WFTC) funding. The budget provides $3.5 billion to deploy baseload power and $1.2 billion to support seven AI supercomputers at the Argonne and Oak Ridge National Laboratories. It also provides $3.6 billion to the National Nuclear Security Administration (NNSA) and $394 million to support the development of a domestic supply of critical minerals. Cuts within DOE include canceling $15.2 billion in funding for the Infrastructure Investment and Jobs Act (IIJA); reducing funding for Energy Efficiency and Renewable Energy (EERE) Programs and eliminating funding for climate change research. The Budget realigns ARPA-E to focus its research on AI, critical materials, and fusion fuels.
Within the Department of the Treasury, the budget would redirect Community Development Financial Institutions (CDFI) Fund awards to rural communities.
The Small Business Administration (SBA) would receive $329 million, a $671 million decrease, or 67%, from last year’s enacted level. It eliminates $309 million for “entrepreneurial development programs,” eliminating all programs with the exception of $21.4 million to support veterans. Among items on the chopping block are the SBDCs, SCORE, FAST, Regional Innovation Clusters, Growth Accelerators, and Women’s Business Centers. SBA’s more detailed FY 2027 budget justification to Congress, available here, also calls for the repeal of the New Market Venture Capital and Renewable Fuel Capital Investment programs.
The National Aeronautics and Space Administration (NASA) would receive $18.8 billion for FY 2027, a $5.6 billion, or 23% decrease, from the 2026 enacted level. The budget proposes, as it did in FY 2026, to eliminate the Mars Sample Return mission. It would also eliminate funding for several of NASA’s Office of Science, Technology, Engineering, and Mathematics (STEM) Engagement programs, including the Minority University Research and Education Project, which supported Historically Black Colleges and Universities.
Within the Department of Health and Human Services (HHS), the National Institutes of Health faces a potential $5 billion cut. The budget proposes eliminating the National Institute on Minority Health and Health Disparities, the Fogarty International Center (FIC), and the National Center for Complementary and Integrative Health.
The Community Development Block Grant program is slated for elimination in the Department of Housing and Urban Development. In addition to the $3.3 billion appropriated for the program, the line item housed over $3.6 billion in Congressionally directed spending projects under the label "Economic Development Initiatives."