FY27 President’s Budget Request Signals Major Shifts in Higher Education, Infrastructure and Domestic Programs

On April 3, 2026, the White House released the Fiscal Year (FY) 2027 President’s Budget Request (PBR) for the fiscal year beginning October 1, 2026.

The request proposes a 10 percent reduction in nondefense discretionary spending, totaling approximately $73 billion, alongside a $1.5 trillion defense budget. Of the defense total, approximately $350 billion is proposed to be enacted through the reconciliation process, with the remainder subject to annual appropriations.

The PBR outlines the Administration’s proposed funding levels across federal agencies and programs and will be considered by Congress as part of the FY27 appropriations process.

Transportation & Infrastructure

The budget reflects changes to funding levels across transit, rail, highway and port programs. The budget does not include a surface transportation authorization proposal.

Reductions to selected programs include: 

• Capital Investment Grants (CIG): reduced by approximately $1.6 billion
• Low or No Emission Grants: reduced by approximately $1.05 billion
• State of Good Repair Grants: reduced by approximately $950 million
• All Stations Accessibility Program: reduced by approximately $350 million
• Ferry Service for Rural Communities Grants: reduced by approximately $250 million
• Federal-State Partnership for Intercity Passenger Rail: reduced by approximately $7.2 billion

The request also proposes eliminating several discretionary programs, including the Federal-State Partnership for Intercity Passenger Rail program, RAISE/BUILD/TIGER grants, the Mega grant program and earmark accounts.

Requested funding and related provisions include:

• $500 million for the Port Infrastructure Development Program (PIDP)
• $2.4 billion for MARAD, including the formation of a Maritime Security Trust Fund
• $770 million for INFRA
• $300 million for CRISI
• $713.7 million for the Bridge Formula Program
• 1 percent increase in obligation limitations on Highway Trust Fund contract authority above FY26 levels
• Cancellation of approximately $4.2 billion in unobligated balances from the NEVI Formula Program and Charging and Fueling Infrastructure Grants Program

Higher Education

The budget requests $76.5 billion for the Department of Education, a reduction of approximately $2.3 billion from FY26. The request includes $10.5 billion for the Pell Grant program to address a projected funding shortfall. The maximum award amount is not increased.

Proposed eliminations, reductions, and structural changes include:

• Federal TRIO Programs: $1.191 billion eliminated
• GEAR UP: $388 million eliminated
• Supplemental Educational Opportunity Grants (SEOG): $914 million eliminated
• Federal Work-Study: reduced by approximately $1.1 billion
• Strengthening Institutions Program: $112 million eliminated
• Minority-Serving Institutions programs: $354 million eliminated, with continued funding for HBCUs and Tribal Colleges
• Fund for the Improvement of Postsecondary Education (FIPSE): $136 million eliminated
• International Education programs: $81 million eliminated
• Child Care Access Means Parents in School (CCAMPIS): $75 million eliminated
• Elimination of Adult Basic Education state grants, approximately $715 million
• Consolidation of workforce programs into a block grant administered by the Department of Labor
• Transfer of Career and Technical Education programs to the Department of Labor

The request also reduces funding for the Office for Civil Rights to $91 million.

Water and Environmental Programs

The budget requests $4.2 billion for the Environmental Protection Agency, a reduction of approximately 52 percent.

Proposed changes and provisions include:

• Clean Water State Revolving Fund: reduced by approximately 90 percent
• Drinking Water State Revolving Fund: reduced by approximately 87 percent
• More than $2.5 billion in savings through restructuring of State Revolving Funds
• No new funding for the Water Infrastructure Finance and Innovation Act (WIFIA) program beyond administrative costs
• Geographic programs funded at $584.9 million, compared to approximately $690 million in FY26
• Reducing Lead in Drinking Water program funded at $20 million
• Midsize and Large Drinking Water System Resilience program funded at $2.25 million
• $7 million for drinking water emergency response activities

Other Domestic Programs

The budget proposes eliminations, reductions, and restructuring across domestic programs, including:

• Elimination of Low Income Home Energy Assistance Program (LIHEAP)
• Elimination of Community Services Block Grant (CSBG)
• Elimination of Community Development Block Grant (CDBG)
• Elimination of HOME Investment Partnerships program
• Elimination of Community Facilities Grant Program
• Reductions to homeless assistance grants
• Restructuring of Continuum of Care and Emergency Solutions Grants
• $1.5 billion reduction to FEMA non-disaster grant programs
• $1.7 billion reduction in Department of Justice state and local grant programs

Next Steps

The FY27 appropriations process is underway in Congress. The Director of the Office of Management and Budget is scheduled to testify before the House Budget Committee on April 15, 2026 and the Senate Budget Committee on April 16, 2026, with additional agency hearings expected throughout the month. The President’s Budget Request will be considered by Congress in developing FY27 appropriations legislation.