President Trump on May 2 sent to Congress an initial proposed budget for Fiscal Year 2026, beginning October 1, that would cut discretionary spending by 8 percent, including a 13 percent increase for defense spending and a 17 percent cut for non-defense programs.
The budget is the first published, comprehensive view of how the Trump administration intends to reduce federal spending and instead leave such responsibilities to state and local entities.
A more detailed budget providing agency by agency spending levels is expected to be released later.
The budget document is not binding, but is indicative of the President’s goals. APPA noted that any such changes would likely have to be enacted as part the annual appropriations process and, so, could be subject to a filibuster in the Senate.
The budget would eliminate funding for the Low-Income Home Energy Assistance Program (LIHEAP).
The budget document states that the program is unnecessary because increased energy production will lower energy costs and because “States have policies preventing utility disconnection for low-income households, effectively making LIHEAP a pass-through benefitting utilities in the Northeast.”
The budget also justifies the cuts saying that LIHEAP benefits consumer in “states like New York and California … which have implemented anti-consumer policies that drive up home energy prices.”
Finally, the budget cites a 15-year-old audit from the Government Accountability Office finding potentially fraudulent LIHEAP applications – the recommendations from which have all since been implemented.
APPA noted it strongly supports LIHEAP and said it will fight vigorously to protect the program throughout the 2026 appropriations process.
CISA
The budget would cut funding for the Cybersecurity and Infrastructure Security Agency (CISA) by $491 million (roughly 16 percent).
The budget states that it “refocuses CISA on its core mission—Federal network defense and enhancing the security and resilience of critical infrastructure—while eliminating weaponization and waste.” It also “removes offices that are duplicative of existing and effective programs at the State and Federal level.”
The budget would cut non-defense spending at the Department of Energy (DOE) by 18 percent.
That includes canceling $15 billion in unspent funds from the Infrastructure Investment and Jobs Act, including those funding renewable energy and carbon capture investments.
It would also reduce funding for the Office Energy Efficiency and Renewable Energy by $2.6 billion (a roughly 75 percent cut) and would reduce funding for the Office of Science by $1.1 billion (roughly a 13 percent cut).
DOE’s Environmental Management budget would be reduced by $389 million. A portion of that is due to transferring responsibility for the Savanah River site in South Carolina to the National Nuclear Security Administration, where plutonium pit production capabilities would be developed. Otherwise, the budget maintains funding for cleanup at the Hanford site in Washington at the 2025 enacted level, but reduces funding for various cleanup activities at other sites.
The budget would also reduce funding for the Environmental Protection Agency by 55 percent, from $9.1 billion to $4.2 billion.
The budget would also reduce non-disaster Federal Emergency Management Agency Grant programs by $646 million.
Details are not provided, but a fact sheet accompanying the budget says that it “maintains the Preparedness Grants Portfolio and other State-level programs to provide resources and encouragement for resilience at the local level.”
