by Lauren Steiner
I’ve been tracking critical signals from Washington—and from the broader economy—that point to growing challenges for grant-funded organizations. Mitch Stein ’s dispatch from Capitol Hill offers a must-read: after 16 meetings with congressional offices, he shares a clear-eyed view of what’s likely (and unlikely) to move forward.
Here’s where I want to double click for all of us in the grant-seeking world:
Don’t Count on New Federal Dollars
With sweeping tax cuts under consideration, Congress is struggling to avoid a major deficit increase. The math just doesn’t work in favor of nonprofits. We shouldn’t expect new grants or contracts in the 2025 federal budget. In fact, many previously approved funds and nonprofit contracts are now paused or rescinded through executive orders—unlikely to be reversed anytime soon.
If your organization relies on public dollars, this is the moment to diversify and refocus your strategy.
The Charitable Act: A Glimmer of Hope
H.R. 801 (The Charitable Act) could be a breakthrough for philanthropy. It would allow all taxpayers—not just those who itemize—to deduct charitable donations, up to $5,000 for individuals and $10,000 for couples.
A smaller version of this policy (just a $300 deduction) passed in 2020 and led to a $10 billion increase in donations. The potential is real. But there’s a tradeoff: it reduces tax revenue, which could make it harder to pass amid budget negotiations. That said, the bill has bipartisan, bicameral support—and it’s not off the table yet.
Market Volatility Could Shrink Foundation Giving
The recent tariffs announcements have already sent waves through the market. If the downturn holds, foundation assets could take a hit. That means fewer grant dollars from private philanthropy—just as government funding is pulling back.
For grant seekers, that’s a dangerous squeeze. Fewer public dollars. Less available from foundations. The result: more competition and more pressure.
What You Can Do
- Shore up funder relationships now—don’t wait for your next proposal deadline.
- Educate your board and leadership about the economic headwinds and the need to stay nimble.
- Advocate. Tell your elected officials how your mission is being affected. If the Charitable Act would help your donors give more, say so.
- Keep listening. As funding tightens, those who bring empathy, clarity, and strategic focus will rise above the noise.
I’ll continue to share insights as the policy picture and economic landscape evolve. In the meantime, if your organization is navigating these shifts or rethinking its strategy, we’re here to help.
This blog has been re-purposed from Lauren Steiner’s LinkedIn newsletter. For more insights from Lauren, subscribe to her newsletter, Grant Seeker’s Edge.
