Trump Budget Proposal Slashes Federal Funding, Threatens the Great Lakes and Sets Up Showdown With Congress  

The Trump Administration’s proposed FY 2026 President’s Budget slashes federal non-defense spending and proposes steep cuts to federal programs that protect and restore the Great Lakes and the communities that depend on them.  

The White House proposal to cut federal funding threatens Great Lakes residents, putting their health and economic security at risk by defunding water infrastructure programs, important research and observation programs, and efforts to assist communities overburdened from pollution. At the top of the list is the U.S. Environmental Protection Agency (“U.S. EPA”), with a proposed overall cut of 55% that would gut key water infrastructure programs that help pay for safe and clean drinking water, and stop sewage overflows, flooding, and basement backups. Also on the chopping block are the National Oceanic and Atmospheric Administration (-19%), the Interior Department (including the Fish and Wildlife Service, National Park Service, and U.S. Geologic Survey, -31%), and U.S. Department of Agriculture (-18%), all of which play key roles in restoring and protecting the Great Lakes through action on the ground and robust scientific research. Taken together, the White House proposal to gut federal funding not only threatens the Great Lakes but also sets up a showdown with Congress, which must decide whether to protect core funding for the programs it created or go along with the President’s proposed deep-cut budget. 

With water infrastructure needs growing, budget drastically cuts funding

Under this budget, U.S. EPA would abdicate a large portion of its federal responsibility and partnership with the states as set forth by Congress in both the Clean Water Act and Safe Drinking Water Act. And it comes at a time when water infrastructure needs are growing fast. Based on its 2023 Drinking Water Needs Information and Assessment Survey and its 2022 Clean Water Needs Survey, U.S. EPA estimates that Great Lakes states need at least $290.3 billion in water infrastructure investment over the next twenty years. Against this need, the proposed budget would decimate federal funding levels for the Drinking Water and Clean Water State Revolving Funds (“SRFs”) – the primary federal program for funding and financing water infrastructure projects – by nearly 90%. Such cuts threaten to destabilize states and communities struggling to ensure safe drinking water and protections from flooding and sewage. The Great Lakes states would see the following decreases in federal funding for water infrastructure programs: 

While the states have built up funding in their state-administered SRFs since Congress established these programs, the states cannot meet the estimated water infrastructure needs on their own. The proposed budget ignores that federal funding plays key roles in state-administered SRFs. States rely heavily on federal funding to provide principal forgiveness or grant funding to disadvantaged communities that struggle to afford standard awards. States also use federal funding to help pay for staffing and technical assistance to communities, and to supplement repayable loan awards. U.S. EPA plays a key role in administering SRF funding, including assessing infrastructure needs on a regular basis to make sure funding goes to the states proportional to the need, and ensuring drinking water, stormwater, and sanitary system operators comply with standards that keep us and our waters safe. The White House’s blithe explanation that it is returning control of these programs to the states ignores the important federal partnership that has been underway since Congress first established these programs decades ago.  

Cuts threaten programs that protect Great Lakes from algal blooms, invasive species, and more

The administration’s budget also proposes a $1 billion reduction in EPA’s categorical grants. These programs support state efforts to implement Clean Water Act regulations, reduce lead in drinking water, reduce sources of non-point source pollution that fuels harmful algal blooms, assist small and disadvantaged communities struggling to implement water infrastructure programs, and develop a water workforce. Like the proposed reductions to the SRFs, the proposal to nearly eliminate all categorical grants upends important federalism goals for programs Congress established to deal with specific needs. 

As noted above, the budget also includes steep cuts at the National Oceanic and Atmospheric Administration, the Interior Department (the Fish and Wildlife Service, the U.S. Geologic Survey and the National Park Service), and the U.S. Department of Agriculture. These cuts threaten the restoration of the Great Lakes by decreasing our ability to conduct scientific investigations, address runoff pollution and harmful algal blooms that threaten our drinking water, control invasive species to protect our fisheries, and protect national parks in the region. 

The cuts in the administration’s proposal would threaten the quality of the drinking water relied on by more than 30 million Americans in the Great Lakes region. The cuts would defer and delay action to stop sewage backups into homes and surface waters, replace failing septic systems, and solve chronic flooding. Access to safe and clean drinking water and freedom from flooding and sewage impacts are basic needs that should be guaranteed to all citizens and communities across the Great Lakes. 

Will Congress agree to such steep cuts?

The big question is whether Congress will agree to such steep reductions. The answer is unclear and, in some cases, such as the proposed $3.4 billion proposed cuts to water infrastructure programs, the answer may be a hard no. 

Just last week, in a display of bipartisan unity, the Senate Environment and Public Works Committee, under the leadership of Senator Shelley Moore Capito (R-WV), held its first hearing on water infrastructure funding with the goal of finalizing a bipartisan water infrastructure package that would reauthorize both the Drinking Water and Clean Water State Revolving Funds, as well as other water infrastructure grant programs like the Water Infrastructure Financing and Innovation Act program. Sen. Capito, who played a leading role in negotiating the bipartisan Infrastructure Investment and Jobs Act of 2021 (IIJA) with its $50 billion investment in water infrastructure, extolled the federalism virtues of the SRFs and the important role they played in assisting states with meeting their water infrastructure needs and providing water services to underserved communities. Senator Capito, and the other senators attending the hearing including Senator Kevin Cramer (R-ND), Senator Adam Schiff (D-CA), Senator Lisa Blunt Rochester (D-DE) and Senator Angela Alsobooks (D-MD) all praised the IIJA water infrastructure funding, noting the many projects underway in each of their states addressing important community needs, including upgrading treatment facilities, replacing aging systems, supporting the needs of rural and underserved communities, replacing lead service lines, and dealing with contaminants such as PFAS.  

The debate in the reauthorization of water infrastructure programs is not whether there will be the votes to pass the legislation, but how much control to give to states at the expense of federal oversight. These programs are designed to help states meet their obligations – and protect our health – under bedrock federal laws like the Clean Water Act. That is a very important question and one in which the answer has yet to emerge. The Senate Environment and Public Works Committee will be conducting other hearings on this topic and the House is expected to follow suit later this year. 

In the meantime, the appropriations process is well underway, and the House and Senate Appropriations Committees have been working on the FY 2026 budget in anticipation of the start of the fiscal year this October. The Trump Administration’s FY 2026 budget proposal is just that, a proposal, and Congress will be evaluating the steep budget cuts. For our part at the Alliance, we will be meeting with members of the Great Lakes delegations to point out the many problems with the proposed cuts and working hard to ensure that the final budget package passed by the House and Senate protects and restores the Great Lakes.