Federal Action, Local Impact
Dear neighbor,
Over the last 9 weeks, President Trump’s administration has announced plans to cut billions in federal funding. He's vowed to slash the budgets of numerous agencies and cut funding for several programs.
Indiana is the third most reliant state on federal funding behind Louisiana and Mississippi. Nearly 44% of our budget comes from federal agencies and grants. Here are some of the biggest impacts Trump’s plans will have on Hoosiers.
Two weeks ago, the Trump administration imposed 25% tariffs on Canada and Mexico and doubled the tariffs on China to 20%. This week, he announced a 25% tariff on cars.
These tariffs are expected to heavily impact Indiana, with an article from The Conversation projecting our state to be the third most impacted state by Trump’s tariffs. Indiana is expected to lose $4.82 billion and see a 1.12% decrease in our GDP, affecting the auto, manufacturing, and agriculture industries. Our state is expected to lose $4.82 billion and see a 1.12% decrease in our GDP, affecting the auto, manufacturing, and agriculture industries the most.
The auto industry, one of Indiana’s biggest economic sectors, is expected to lose $28.2 billion because of the initial tariffs. After this week’s announcement, an even larger hit is now expected. These financial losses would put around 680,000 jobs at risk across the nation.
A Hoosier family of four is projected to spend an extra $2,836 each year, equivalent to half a year’s worth of utility payments.
Read more about how the tariffs could impact Indiana's economy here.
Two weeks ago, the Department of Education laid off nearly 50% of their staff. This large personnel cut will slow down the agency’s ability to support education programs across the country.
Indiana receives $1.8 billion from the Dept. of Education for K-12 and higher education, a little less than 10% of the agency’s budget. The Division of Family Resources (DFR), which primarily funds schools with a high number of low-income students or students in need of special education, receives a little under $2 billion from the federal government.
Without this federal funding, our entire education system will suffer and we will see growing inequalities. Wealthier schools will likely be able to sustain their arts programs, STEM extracurriculars, and tutors, but schools in less affluent districts will struggle to maintain their services. All young Hoosiers deserve to have access to an education that sets them up for success, regardless of their location or tax bracket.
Read more about how Indiana schools could be affected if Trump succeeds in dismantling U.S. Department of Education here.
Congressional Republicans have proposed $880 billion in federal cuts, which would be impossible to achieve without cutting Medicaid or Medicare. Since roughly 70% of Indiana's funding for Medicaid comes from the federal government, Indiana could be in a serious bind. It's estimated that close to 484,000 Hoosiers would lose their health care coverage if these federal cuts are passed and Indiana fails to cover the costs.
Read more about the impact federal cuts will have on Medicaid in Indiana here.
It’s not just Medicaid that's been targeted. The National Institute of Health (NIH), the world’s largest public funder of medical research, is cutting the amount universities receive for research to a flat rate of 15%.
Indiana University and Purdue University’s federal funding for on-campus medical research exceeds 55%. A federal court has temporarily paused the NIH cut, but if they're implemented millions of dollars would be cut from essential medical research in Alzheimer’s and cancer in Indiana.
Read more about how cuts to NIH would impact our public universities here.
The Trump Administration recently cut grants to The Fair Housing Center of Central Indiana (FHCCI). The Center provides various resources to people facing housing insecurity. It also provides legal support to individuals dealing with discriminatory housing practices. The administration has cut the remainder of a $138,889 grant expected to last through June 30, 2025.
Indiana is already considered one of the most difficult states to rent in, with Fort Wayne ranked the third least renter-friendly city in the U.S., according to USA Today. These cuts could worsen the conditions for tenants in Indiana and lead to more discriminatory practices within our housing market.
Read more about the HUD cuts here.
Impacts to veterans services, the postal service, clean water/clean air protections and so much more are yet to be understood. I will continue to track how these ever-evolving funding cuts will impact Indiana and will strive to keep you informed.
As always, please contact my office at h87@iga.in.gov with any questions or concerns.
In service,
Carey, did you know that they are planning on letting 200 State Dept of Health employees go in their cuts to reduce spending? Where are these people going to find jobs and public health for the State will diminish?! I fear a Recession/Depression is in the forecast...unless you are rich.
Keep advising on how federal cuts will impact us. Thank you Ms. Hamilton