Earlier this month, the Trump Administration released a proposed budget for Fiscal Year (FY) 2027 calling for major cuts to education and safety-net programming that would increase students’ basic needs insecurity and harm student success.
While the proposal is only that—a proposal—and Congress is unlikely to enact all the recommendations to slash domestic investments, the continued attacks on higher education and an unnecessary mindset of scarcity across federal programs will make it even more difficult for successful programs to fight for continued survival.
The budget’s proposed underfunding of essential programming also comes less than a year after Congress and the Administration enacted deep eligibility and benefit cuts under the One Big Beautiful Bill Act, including new restrictions on public benefit programs like the Supplemental Nutrition Assistance Program (SNAP) and Medicaid, as well as major cuts to student financial aid–particularly for graduate students and parents of undergraduates–that have left millions scrambling on how to afford both higher education and daily necessities.
Each year, the President’s budget proposal sets an initial framework for Congressional appropriators to consider as they craft a budget resolution and begin the bipartisan work of drafting bills to fund discretionary programs across the government. Thankfully, earlier this year, Congress came together on a bipartisan basis to maintain funding for key basic needs resources and reject the Administration’s proposed cuts, as we urged them to do.
We encourage lawmakers to once again reject the proposed cuts across the U.S. Departments of Education, Health and Human Services, and Agriculture, and recommit to investing in programs that help students afford essentials like food, health care, child care, and emergency expenses. We’ve laid out exactly how Congress should act instead to fund critical basic needs resources and financial aid in our FY27 appropriations priorities.
U.S. Department of Education
In line with the Administration's stated goal of putting the U.S. Department of Education "on a path to elimination," the budget requests an overall $2.3 billion decrease from FY 2026 enacted levels. However, the decrease for essential student programming is much deeper and is largely masked by a substantial bump to discretionary Pell Grant funding (noted in detail below). In other words, non-Pell higher education programs would face extreme cuts.
In addition, many of the programs that the Administration has proposed to fund at all are currently being implemented through "Interagency Agreements" and co-managed by the U.S. Departments of Labor and HHS, a process that has led to considerable confusion and additional burden for grantees across higher education. The public also lacks key details on how these agreements are functioning and whether the Administration is following the law in implementing programs created and funded by Congress.
Specifically, the budget would:
Zero out funding for CCAMPIS: The Child Care Access Means Parents in School (CCAMPIS) program, which funds campus-based child care for low-income student parents, would be eliminated. While the Administration argues that CCAMPIS is duplicative of other federal and state child care programs, evidence does not back up this claim. In fact, the largest federal child care program, the Child Care Development Block Grant, reaches only 1-in-7 eligible children nationwide, and exceedingly few students in higher education.
Eliminate the Basic Needs Grant and other essential competitive grants: The budget would eliminate the Fund for the Improvement of Postsecondary Education (FIPSE), which includes the Basic Needs for Postsecondary Students program (known commonly as the “Basic Needs Grant”), Postsecondary Student Success Grant (PSSG), and the Rural Postsecondary & Economic Development (RPED) grants. The Administration previously redirected the bipartisan funding for FIPSE grants toward their own pet projects, but lawmakers subsequently restored funding in the recent FY26 appropriations deal in February.
Slash funding for campus-based aid: The budget proposes to eliminate the Supplemental Educational Opportunity Grant (SEOG) program, which is targeted to Pell Grant recipients and previously was able to be used, in part, as emergency aid. The SEOG program was most recently funded at $910 million in FY26. The budget also proposes to slash Federal Work-Study (FWS) by 90%, from $1.236 billion to just $123 million. The proposal would shift the employer share of Work-Study wages from 25% to 90%, dramatically reducing the federal contribution.
Further gut staffing and capacity at the Department: The budget proposes a major reduction in staffing capacity, with a request of just 1,946 full-time equivalent (FTE) employees, or half the size of the agency just a few years ago. A significant proportion of these proposed cuts would come from “Program Administration,” which, as it sounds, funds the staff needed to run the programs described above, like CCAMPIS and FIPSE.
Under the proposal, just one employee would remain in the Office of the Under Secretary (presumably the Under Secretary himself), and just 15 staff would remain in the Office of Postsecondary Education (OPE), an 85% decrease from when President Trump took office.
Within Student Aid Administration, which runs federal financial aid, a massive cut of $470 million to salaries and expenses is proposed, with that same amount shifted over to student loan servicing instead -- a clear demonstration of the Administration’s misplaced priorities.
Institute of Education Sciences: The FY27 budget request proposes a 67% cut ($531 million) to the Institute of Education Sciences (IES), which runs critical federal data collection on essential information on college costs, financial aid, and student basic needs.The cut is proposed even though the Administration has requested a massive increase in data collection on college admissions. Adequate staffing is necessary to ensure higher education data are accurate, and this budget would make that impossible.
The State of Play on Pell Grants
The Pell Grant program remains under considerable budgetary strain. The Hope Center recently joined a coalition of more than 65+ national organizations in calling on Congress to prevent a looming shortfall in the Pell Grant program, which, if not addressed swiftly, could lead to cuts for some of the seven million students who rely on the Pell Grant each year.
The Administration proposed approximately $33 billion in discretionary funding for the Pell Grant program in FY27, a $10.548 billion increase that they say would fully address the program’s projected funding shortfall through the end of FY27.
While this part of the President’s budget was welcome, it has revealed gaps in how the Administration and Congress calculate the budgetary costs for financial aid. The $10.5B figure is about 60 percent lower than the $16.9 cumulative shortfall for FY26 and FY27 that the Congressional Budget Office (CBO) recently estimated.
The massive $6.4 billion disparity is due to the different ways the Administration and CBO, respectively, can access federal data for modeling and budgeting program costs. The Administration can use the real-time information it has on financial aid applicants’ earnings and tax returns provided on the Free Application for Federal Student Aid (FAFSA) to more precisely predict program costs, whereas CBO does not yet have such authority. These data use protocols are governed under Internal Revenue Code (IRC) 6103, which was amended by the FUTURE Act. Congress will ultimately have to close the shortfall based on CBO’s more limited calculations, unless it acts to grant CBO additional (and highly secure) budget modeling capabilities.
Despite the proposal to increase Pell funding, the Administration budget would still freeze the maximum award at $7,395 for the fifth consecutive year. Given that costs of attendance (particularly non-tuition costs) continue to rise, a frozen maximum grant constitutes a net cut in real terms for low-income students: the current maximum grant took effect on July 1, 2023, and now has $593 less value for students as of March 2026 due to inflation.
The Pell Grant program’s long-term financial health remains unstable in part due to the unusual way the program is funded. While it functions like an “entitlement,” meaning all qualifying students receive the grant, Congress has to fund the program every year through the discretionary funding process rather than guaranteeing its funding through mandatory appropriations.
Members of Congress are expected to reintroduce the Pell Grant Preservation and Expansion Act in the coming months, which proposes to move the Pell Grant program toward full mandatory funding and eliminate the possibility of future shortfalls. During previous shortfalls, Congress made deep cuts to eligibility which created major barriers for low-income and nontraditional students and impeded students’ ability to graduate.
U.S. Department of Health and Human Services (HHS)
The proposal would reorganize HHS by consolidating programs from SAMHSA, HRSA, the Office of the Assistant Secretary for Health, and select CDC programs into a new "Administration for a Healthy America (AHA)"—a proposal Congress declined to fund last year. Specifically, it would:
Level fund Garrett Lee Smith Campus (GLS) Suicide Prevention Grants: The budget would maintain level funding for GLS campus grants ($10.5 million) despite increased need for campus mental health programming, though with SAMHSA being folded into the proposed AHA, administration of grants remains murky at best.
Eliminate the Low-Income Home Energy Assistance Program (LIHEAP): LIHEAP serves approximately 6 million households who struggle to afford utility bills, and the Administration would zero out funding (approximately $4.1 billion) at a time of skyrocketing home energy costs for students and families.
Maintain level funding for Head Start and the Child Care and Development Block Grant (CCDBG): The budget maintains level funding for both Head Start and the Child Care and Development Block Grant, effectively freezing these programs without adjustments for inflation or rising costs, and proposes relaxing various licensure and monitoring standards for Head Start. When combined with the proposed elimination of CCAMPIS grants, parenting students would face a net loss of child care support across federal programs.
U.S. Department of Agriculture
In the aftermath of OBBBA’s new restrictions on SNAP, which will increase state burdens in funding food assistance, reduce benefit levels for millions of families, and cut eligibility for over 22 million families nationwide, and the Administration’s attempt to withhold SNAP benefits from hungry families during the November 2025 government shutdown, there are no new proposals from the Administration to account for rising food insecurity across students and families. Specifically, the Administration’s FY27 budget:
Fails to restore OBBBA’s SNAP cuts. The budget estimates a reduction in SNAP funding from $107.5 billion to $101.2 billion, the bulk of which comes from state administration funds and a reduced budget for personnel.
Slash the value of WIC for families: The budget would cut the cash value benefit that supports the purchase of healthy fruits and vegetables for pregnant and postpartum families, from around $50 to $11 for adults, returning benefits to a level that existed prior to a 2024 rule change.
What to Watch for Next
In the coming weeks, Congressional leaders will have the opportunity to question cabinet heads, including Education Secretary Linda McMahon and HHS Secretary Robert F. Kennedy Jr., about the Administration’s priorities for FY27 and beyond.
Secretary Kennedy testified in front of the House Labor, Health and Human Services, Education, and Related Agencies (“Labor-H”) Appropriations Subcommittee on April 16th, and is set to testify in front of the Senate Health, Education, Labor, and Pensions Committee on April 22nd.
Meanwhile, House and Senate appropriators have also begun to announce the timeline for when to expect their own appropriations bills; the House Labor-HHS-Education bill is currently scheduled for Subcommittee markup on Friday, June 5, though that timeline could shift as appropriators work through the content of the bills themselves.
The Hope Center will continue to advocate for protecting and increasing federal investments in student basic needs, and keep the student basic needs community up to date as the FY27 budget and appropriations process plays out.