Today, the White House announced President Trump’s fiscal year 2026 discretionary budget request, proposing major shifts in federal spending priorities, including requests that could significantly impact Tribes. The budget request includes:
Funding Reductions
- Bureau of Indian Affairs Programs: The budget proposes a $617 million reduction to programs that support Tribal self-governance and Tribal communities. This includes eliminating the Indian Guaranteed Loan program for tribal business development and the Indian Land Consolidation Program.
- Bureau of Indian Affairs Public Safety and Justice: A $107 million reduction is proposed for tribal law enforcement programs to “streamline” operations and reduce redundancies.
- Bureau of Indian Education Construction: The budget proposal cuts $187 million from construction programs for Indian Education facilities, citing “poor program management, cost overruns, and delays.”
- Department of Energy (DOE) Energy Efficiency and Renewable Energy (EERE): The budget proposal cuts $2.5 billion from the DOE’s EERE programs.
Maintained or Increased Funding
- Indian Reservation Drinking Water Program: The budget proposal increases funding by $27 million (to $31 million total) for Tribes to maintain access to drinking water and wastewater infrastructure.
- Water Infrastructure: While reducing general water infrastructure funding, the budget proposal “prioritizes funding for Tribes to maintain their water infrastructure.”
- Categorical Grants: The document states that the budget “maintains funding at 2025 enacted levels for Tribes” while eliminating 16 categorical grants for states.
- Rural Financial Award Program: Interestingly, while cutting the traditional CDFI Fund, the budget proposes creating a new $100 million Rural Financial Award Program. This program would require 60% of CDFI loans and investments to go to rural areas and would leverage existing CDFI Fund administrative resources.
Program Eliminations
- Community Development Financial Institutions (CDFI) Fund: The budget eliminates CDFI Fund awards, stating “that they were abused to advance a partisan agenda”. The budget states that the function of CDFI is better served by local government or the private sector.
- Community Service Block Grants (CSBG): The budget cuts $770m in CSBG grants, stating they no longer focus on poverty reduction.
- Environmental Protection Agency Environmental Justice Program: The budget proposal eliminates this program, characterizing it as a “slush fund for climate and racial extremism.”
- Native Hawaiian Housing Block Grant: This program would be eliminated, with the document suggesting it should be funded by the State of Hawaii instead.
- Native American Competitive Grant Programs: The budget proposes streamlining housing assistance by eliminating competitive grants while maintaining the primary formula grant to Tribes.
While the President’s Budget serves as a blueprint for the Administration’s priorities, it is not a binding document for drafting funding legislation. Currently, appropriations items will take a backseat to the ongoing reconciliation work in Congress. Next week, several House and Senate committees are scheduled to hold reconciliation/budget hearings, a critical step in the budget process.
NAFOA will continue to monitor the federal budget process and provide additional information as it develops. With the work remaining on the legislative calendar, it is unlikely that final appropriations amounts will be available anytime soon. Continue to follow our Policy Alerts for more information about the 2026 Budget and its potential impact on Tribes, including how you can stay involved and provide input on matters impacting Tribes.
Read the Full Budget Request Document
If you would like to provide feedback or have questions, please contact a member of our policy team: Nicholas Lovesee, Director of Policy, at nicholas@nafoa.org, or Marisa Joseph, Policy Specialist, at marisa@nafoa.org
