December 11, 2025

Information Sharing on Federal Funding: December 12, 2025

The federal grants landscape in 2025 experienced unprecedented instability, driven by executive actions, DOGE-driven cancellations, bureaucratic restructuring, reductions in force, legal uncertainty, and a government shutdown. If you want a refresher, this summary table captures the main points (opens PDF). As we approach the end of 2025, our last federal funding update for the year reflects on the changes and what the potential implications and predictions are for federal grantmaking in 2026.

We also invite you to join us for a new webinar in the New Year: The Future of Grants: Predictions for 2026. We welcome readers’ thoughts as we all collectively work to get a handle on what to expect in the coming year.

If 2025 has taught grant seekers anything, it’s that federal funding is no longer shaped by program design and appropriations, rather, is is now shaped by a highly politicized administration: political appointee policy screens, termination “for convenience,” program officer staffing uncertainty, legal uncertainty, and whether funds are actually delivered as Congress intended are all realities.

That context matters as we look to 2026. Will the rules, timelines, and administration of grants continue to shift without warning and cause continuing uncertainty?

The reality is that we don’t have a crystal ball. But the “tea leaves” are visible. Agency FY 2026 budget justifications and congressional negotiations suggest two very different but possible operating environments for grant seekers in 2026: one defined by a long Continuing Resolution (CR) that locks in last year’s funding structure, and another defined by a passed budget that could accelerate consolidation, devolution to states, and targeted eliminations of federal discretionary programs.

Scenario 1: If FY 2026 Runs on a Full-Year Continuing Resolution (CR)

A full-year CR is rare, but not unprecedented, and it is being discussed as a possibility in FY 2026 appropriations negotiations. A CR generally keeps funding flowing at prior-year levels and prevents a shutdown, but it also locks the grant landscape into the past, limiting agencies’ ability to start new programs or implement major program restructures.

For grant seekers, the most important takeaway is that a full-year CR would likely blunt the most sweeping eliminations proposed in the President’s FY 2026 request. Many of the high-profile proposals to consolidate or eliminate discretionary grants typically require new appropriations language to take effect. Under a CR, agencies generally cannot launch new programs, dramatically restructure existing programs, or execute large-scale consolidations without Congress affirmatively authorizing that shift. In plain terms, a CR can preserve many familiar programs, yet there will likely still be an operating environment where grants are slower to release, staffing remains constrained, and uncertainty persists about implementation.

The Center on Budget and Policy Priorities has argued that any funding deal must include “enforceable legislative provisions” to ensure appropriated funds reach the people and services Congress intended. This is an issue that will remain central if the executive branch continues to test the boundaries of budget execution.

Read more about this possibility here:

Scenario 2: If a FY 2026 Budget Passes

If Congress passes full-year appropriations for the remaining bills—whether as an omnibus or as additional minibuses—the President’s FY 2026 budget requests and agency Congressional Justifications still provide a clear signal of the administration’s preferred direction. Our cross-agency observations are drawn from those proposed budgets (not from the already-passed appropriations),* and they point toward a structural shift away from many federal discretionary programs and toward greater state control:

  • state-administered block grants in education and workforce
  • state-controlled rental assistance models in housing
  • state-controlled conservation and technical assistance models in agriculture

This trend changes where the funding competition happens. Community organizations may see fewer federal NOFOs and more state-managed discretionary competitions, often with different timelines, political dynamics, and expectations for alignment. The likely result is a changed landscape where federal agencies shrink their direct grantmaking footprint and states become the primary gatekeepers.

The agency proposed budgets signal consistent de-prioritization of programs that are specialized, targeted, or designed for specific populations, particularly those linked to equity, climate/clean energy deployment, and place-based community development. If appropriations align even partially with those requests, the programs most at risk in 2026 include: targeted workforce supports for youth and specific subgroups, specialized education initiatives (civics, arts, rural education supports, Native education), youth-focused housing models, and a broad range of clean energy deployment and community energy programs.

However, three FY 2026 appropriations “minibuses” have already passed and been signed into law, covering Military Construction/Veterans Affairs, Agriculture/FDA, and the Legislative Branch, and they paint a more nuanced picture than the President’s budget alone. A closer look at the Agriculture minibus, for example, shows stronger funding than many expected overall: increases for research, food safety, and farmer-support programs, alongside cuts to climate hubs, conservation, and urban agriculture. The Senate has taken a more bipartisan approach than the House, which is likely closer to where final agreements will land.

Even so, the President’s budget and related policy agenda still matter. They shape how programs are administered and prioritized inside agencies. And as 2025 demonstrated, even when Congress appropriates funding, with the administration’s history of cutting grant funding both preemptively and after award, there may likely be continuing upheaval during the implementation process through delaying NOFOs, cancelling awarded grants, or increased scrutiny of grant recipients.

The FY2026 Department of Transportation BUILD NOFO was released a couple weeks ago, and may be an indication of what is to come. While the NOFO was issued, allowing applicants to view priorities, amount of funding available, eligible project types, and cost-share requirements, it notably missed any details of how to apply. Under “Application Content and Format,” it simply states, “The Department intends to amend this Notice to provide more details,” leaving potential applicants without immediate direction. It may be that agencies are trying to comply with the OMB regulation to issue NOFOs with sufficient notice:

The Federal agency should make all funding opportunities available for application for at least 60 calendar days. However, the Federal agency may modify the availability period of an opportunity as needed. For example, extending the period may be necessary to provide technical assistance to an applicant pool that was not anticipated when the announcement was made or has less experience with applying for Federal financial assistance. The Federal agency may also determine that an availability period of less than 60 days is sufficient for a particular funding opportunity. However, no funding opportunity should be available for less than 30 calendar days unless the Federal agency determines that exigent circumstances justify this.**

We may see more NOFOs released without full details as agencies work to interpret and act on administrative directives for programs.

What Grant Seekers Can Do Now

Whatever 2026 becomes, 2025 tells us what the new “grant readiness” looks like. First, watch priorities and language shifts closely, and be prepared to reframe programs in ways that speak to current federal themes (e.g., workforce readiness, public safety, affordability, domestic production, “efficiency”), but do it without compromising core mission. It is okay, and often wise, to decide a federal opportunity is not worth the compliance risk or mission distortion. Not every organization needs to participate in federal grants. NPR reported on December 11 that some Head Start programs have been told to remove words from their applications, including such words as accessible, cultural competence, culturally responsive, disability, diversity, equality, equity, ethnicity, female, inclusion, mental health, pregnant people/person, socioeconomic, vulnerable populations, underserved, and underrepresented (as a small sample). However, removal of these words is in direct contradiction (opens PDF) to the federal statute creating Head Start: “to promote the school readiness of low-income children by enhancing their cognitive, social, and emotional development… in a culturally and linguistically responsive manner… through programs that provide health, educational, nutritional, social, and other services” (Head Start Act (42 U.S.C. § 9831 et seq.). How current Head Start programs will respond is unknown, but a lawsuit is underway, which was filed in April.

Second, be very intentional about compliance risk. The addition of a fourth review phase – an “accountability review” that assesses consistency with agency priorities and “the national interest” means that some organizations may no longer be competitively viable. That makes narrative strategy and documentation more important than ever. Organizations should avoid mischaracterizing programs just to fit a perceived priority, especially given heightened scrutiny and the real risk of False Claims Act exposure if certifications or representations are later challenged. In 2026, the most resilient applicants will be the ones who can reframe their work while staying truthful and compliant, and speak the language of the moment; or confidently opt out when necessary for organizational integrity.

Finally, be prepared to respond on tight timelines. During 2025, we saw many compressed application windows, some with less than two weeks until the deadline. If that trend continues, or if agencies issue partial NOFOs as they work out details, ambiguity and time pressure will collide to make for grant sprints to apply for programs of interest.

Wellness Strategies to Consider Before and During the Holiday Reset

All of this can be overwhelming. There has been a lot of rapid change in the previous several months. At TGP, we’ve been practicing using various wellness strategies to support our team’s mental health. Below are a few to try if you too need a break:

1) Do a “close-the-loop” brain dump

Before you log off, spend 20 minutes making one list with three sections so that you are prepared for January and can truly rest during the holiday break:

  • What’s active and needs attention in early January?
  • What you are waiting on from others, and who has the ball so you can follow up with them?
  • What will need attention later but is not urgent for the first week back?

Then write the top 3 things you will get done on the first workday back. This will help you shut down the mental to-do list that keeps you “working” when you should be resting.

2) Limit news exposure, but keep awareness if you need to

If you’re doom-scrolling, try this instead:

  • Pick two short windows per day (for example, 10 minutes morning, 10 minutes late afternoon) to check updates.
  • Use one trusted digest rather than real-time feeds.
  • Turn off push alerts to your phone.

That way you stay informed without letting your nervous system be constantly on call.

3) When the state of the nation feels overwhelming: choose “bounded care”

Caring is human. But carrying everything is just not sustainable. Try engaging with one action per week or per month depending on your bandwidth (call, testimony, mutual aid, board service, letters, protest). You can stay engaged without being consumed.

Welcoming the New Year

Stay informed. Join us for The Future of Grants: Predictions for 2026, in which we’ll cover emerging trends not just in federal grants, but private philanthropy as well. Scheduled for January 14, we’ll share practical guidance to support your grant seeking efforts.

Ensure your organization is grant ready. We’re launching a Free 20-Day Grant Readiness Challenge on January 15. Join us for the kick-off webinar and take part in our daily challenge with resources shared over social media.

Build your knowledge. We pre-planned our training line for 2026 so you can too. Through December 31, we are offering a special discount to our subscribers on any of our upcoming trainings in 2026. Use code NEWYEAR2026 for 20% off. Download our at-a-glance schedule. 

Set your strategy. Book a session with one of our grant professionals to discuss funding opportunities, proposal strategies, or ways to strengthen your grant approach. This session is designed for organizations seeking expert advice. Use the “Grant Consulting Call” link on our Contact Us page.

Outsource your pre- or post-award grants work. We are a full-service consulting firm, and can help you with everything from finding funders, to preparing and submitting proposals, to ensuring compliance and effective award delivery. The first step is to book a free Discovery Call and fill out our New Client Application form on our Contact Us page.

We know this year has been hard and we are here to support as best we’re able. If you know of any news or resources to share in our blog about federal funding, please email us at mail@thegrantplant.com.

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* We reviewed Education, Agriculture, Housing, Energy, and Labor.

** See: https://www.ecfr.gov/current/title-2/subtitle-A/chapter-II/part-200/subpart-C/section-200.204

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