NACo voices support for EDA amidst proposed program cuts

Key Takeaways

On April 3, the White House released its Fiscal Year (FY) 2027 presidential budget request, which proposed sweeping cuts to non-defense discretionary spending. Among them was a functional elimination of the Economic Development Administration (EDA) — the agency would retain its statutory authorization but receive zero funding, effectively ending its operations.

In response, NACo sent a letter to congressional appropriators outlining EDA's role in supporting distressed communities and urging sustained investment in the agency. The letter emphasized that EDA's place-based investment model and regional partner networks help communities create jobs, attract private capital and build long-term economic resilience — particularly in rural areas and regions that have experienced significant economic disruption.

EDA's programs are often the primary — and in some cases only — source of dedicated economic development resources in distressed communities. The agency's elimination would remove a key federal tool for responding to sudden economic shocks, including plant closures, natural disasters and market downturns, leaving local governments with fewer options to stabilize and rebuild their economies.

It is worth noting that the presidential budget request reflects the administration's spending priorities but does not carry the force of law. Congressional appropriators hold authority over final funding decisions. EDA received $468 million in FY 2026, level with the prior fiscal year, and has recently been scaling two new core programs — Build 2 Scale and the Regional Technology and Innovation Hubs program — both aimed at expanding the agency's reach and impact in underserved communities.