Discretionary Spending
Multiple Budget Functions
Reduce Funding for Certain Grants to State and Local Governments
CBO periodically issues a compendium of policy options (called Options for Reducing the Deficit) covering a broad range of issues, as well as separate reports that include options for changing federal tax and spending policies in particular areas. This option appears in one of those publications. The options are derived from many sources and reflect a range of possibilities. For each option, CBO presents an estimate of its effects on the budget but makes no recommendations. Inclusion or exclusion of any particular option does not imply an endorsement or rejection by CBO.
Billions of dollars | 2025 | 2026 | 2027 | 2028 | 2029 | 2030 | 2031 | 2032 | 2033 | 2034 | 2025– | 2025– | |
Reduce Department of Energy funding for energy conservation and weatherization grants | |||||||||||||
Change in spending | |||||||||||||
Budget authority | 0 | -0.1 | -0.3 | -0.3 | -0.3 | -0.3 | -0.3 | -0.3 | -0.3 | -0.3 | -1.0 | -2.5 | |
Outlays | 0 | * | -0.1 | -0.1 | -0.2 | -0.2 | -0.3 | -0.3 | -0.3 | -0.3 | -0.4 | -1.8 | |
Reduce Environmental Protection Agency funding for wastewater and drinking water infrastructure and other grantsa | |||||||||||||
Change in spending | |||||||||||||
Budget authority | 0 | -4.0 | -2.3 | -2.4 | -2.4 | -2.5 | -2.5 | -2.6 | -2.6 | -2.7 | -11.1 | -24.0 | |
Outlays | 0 | -0.2 | -1.0 | -2.1 | -2.6 | -2.8 | -2.9 | -2.9 | -2.7 | -2.6 | -5.9 | -19.8 | |
Reduce Department of Housing and Urban Development funding for Community Development Block Grants | |||||||||||||
Change in spending | |||||||||||||
Budget authority | 0 | -5.3 | -3.6 | -3.6 | -3.7 | -3.8 | -3.8 | -3.9 | -4.0 | -4.1 | -16.2 | -35.8 | |
Outlays | 0 | -0.1 | -0.9 | -1.7 | -2.3 | -2.9 | -3.3 | -3.4 | -3.6 | -3.7 | -5.0 | -21.9 | |
Reduce funding for certain Department of Education grants | |||||||||||||
Change in spending | |||||||||||||
Budget authority | 0 | -0.5 | -1.0 | -1.1 | -1.2 | -1.4 | -1.6 | -1.9 | -2.2 | -2.7 | -3.8 | -13.6 | |
Outlays | 0 | 0 | -0.3 | -0.8 | -1.0 | -1.2 | -1.3 | -1.5 | -1.7 | -2.0 | -2.1 | -9.8 | |
Reduce funding for certain Department of Justice grantsb | |||||||||||||
Change in spending | |||||||||||||
Budget authority | 0 | -2.1 | -2.1 | -2.2 | -2.2 | -2.3 | -2.3 | -2.4 | -2.4 | -2.4 | -8.6 | -20.4 | |
Outlays | 0 | -0.1 | -0.4 | -0.9 | -1.5 | -1.9 | -2.1 | -2.1 | -2.2 | -2.2 | -2.9 | -13.4 | |
Total | |||||||||||||
Change in spending | |||||||||||||
Budget authority | 0 | -12.0 | -9.3 | -9.6 | -9.8 | -10.3 | -10.5 | -11.1 | -11.5 | -12.2 | -40.7 | -96.3 | |
Outlays | 0 | -0.4 | -2.7 | -5.6 | -7.6 | -9.0 | -9.9 | -10.2 | -10.5 | -10.8 | -16.3 | -66.7 | |
This option would take effect in October 2025.
* = between -$50 million and zero.
a. These estimates include savings in budget authority through 2026 specified by division J of Public Law 117-58, the Infrastructure Investment and Jobs Act (IIJA). In the Congressional Budget Office's baseline, IIJA funding is projected to continue in future years; these estimates do not include that projected funding.
b. These estimates do not include budget authority that was specified in division B of subtitle D of P.L. 117-159, the Bipartisan Safer Communities Act, which provided advance funding through 2026 for certain programs.
The federal government provides grants to state and local governments to finance local projects, encourage policy experimentation by state and local governments, and promote national priorities. This option would reduce new funding for the following grants by 25 percent in 2026 and by 50 percent after 2026:
- The Department of Energy's grants for energy conservation and weatherization, made through the Office of State and Community Energy Programs.
- The Environmental Protection Agency's grants for wastewater and drinking water infrastructure as well as other grants that help states implement federal water, air, waste, and chemical programs.
- The Department of Housing and Urban Development's Community Development Block Grant (CDBG) program. The reduction includes only base CDBG funding and does not include any possible funding for future disaster recovery efforts.
- Certain Department of Education grants, like those for the 21st Century Community Learning Centers, that fund nonacademic programs that address students' physical, emotional, and social well-being.
- Certain Department of Justice grants to nonprofit community organizations and state and local law enforcement agencies. Those grants include State and Local Law Enforcement Assistance programs, Juvenile Justice programs, Community Oriented Policing Services grants, and grants administered through the Office on Violence Against Women.