Federal funding cuts would significantly affect local nonprofits, survey shows

Cincinnati, Ohio – Recent executive orders and administrative memos have increased the focus on federal grants and contracts. A study exploring the impact such cuts would have on individuals and families in Greater Cincinnati found that most nonprofits receive at least 25% or more of their operating budgets from the federal government. Two-thirds of nonprofits indicated they’d face difficult choices regarding service reductions or closures within six months of federal funding disruption. One organization reported it would be forced to close immediately. 

United Way partnered with local funders, including Greater Cincinnati Foundation and Interact for Health, to survey 109 organizations in our region during three weeks in February. The survey sought to identify the scope of services supported locally by federal funding and how organizations might manage a federal funding freeze.  

Many organizations said they would pursue private and corporate foundation funding to bridge the gap if faced with these cuts. Federal funding accounts for more than $1 trillion in support for state and local programs. These programs provide services ranging from essential needs and housing to youth education and workforce development. Private philanthropy cannot make up the difference.  

“Organizations like United Way provide grants to local nonprofits because we believe in the work they are doing to make a positive impact across our region,” said Moira Weir, President and CEO of United Way of Greater Cincinnati. “While our contributions can be crucial, federal funding often constitutes a significant portion, or even the bulk of, a nonprofit’s budget.”  

Federal funding supports state and local operations by design. This policy approach ensures that federal resources provide meaningful support. Local organizations are equipped to respond effectively to communities’ evolving needs, making nonprofits vital for stability. 

“Nonprofits aren’t just recipients of federal funding,” said Weir. “They play an important role in the community and help the federal government fulfill its obligations to citizens. 

“Without this funding, many of our friends and neighbors could lose access to basic needs or support systems that can put them on a path to a better future.”