April 20, 2025
NONPROFITS FEEL THE HEAT: The Trump administration is mounting a sweeping offensive on America’s nonprofit sector, deploying a blend of funding cuts, the elimination of tax benefits, bureaucratic paralysis and even installing a small DOGE team to target organizations that challenge the president’s agenda.
The tactics include indirect measures, like hollowing out entire grant-making agencies like AmeriCorps and USAID, and making federal personnel or contract cuts at other agencies so deep that groups can no longer access grants or loans. But there are also more direct efforts, like visits from DOGE or the USDA halting $500 million in deliveries to food banks.
DOGE staffers have attempted to install their own operatives inside major nonprofits like NeighborWorks, a community development group, and the Vera Institute, which advocates for lower incarceration rates.
It’s a campaign that’s hitting a sector that’s already struggling. “You’re cutting or eliminating government funding at the same time when donations are going down, at the same time that costs are going up for the nonprofits and the demand for their services is going up,” said RICK COHEN, chief communications officer at the National Council of Nonprofits.
In just over two months, at least 10,000 nonprofit workers have lost their jobs, according to an estimate from the Chronicle of Philanthropy. And groups providing essential services including housing, education and domestic violence support — and who are already scrambling in an uncertain economic environment — could now face an even steeper funding drought.
“Non profits have been running wild off of the drunken unchecked spending of the federal government and that stopped on Jan 20. We are no longer going to support organizations that stand in stark contrast to the mission of the president of the United States,” White House spokesperson HARRISON FIELDS said in a statement.
The Trump White House is considering a budget proposal that would completely eliminate funding for Head Start, a federal program providing early childhood education administered by 1,700 nonprofit and for-profit organizations, the Associated Press reported. It’s unclear if Congress, as it did during Trump’s first term, will keep funding for groups that Trump’s proposed budgets stripped.
Meanwhile, other groups such as NeighborWorks and the Vera Institute are being pressured from the inside. DOGE staffers met with senior leadership at NeighborWorks on Tuesday and requested that a DOGE operative be embedded in the organization’s staff, according to two people with direct knowledge of the meeting granted anonymity to avoid retribution.
“NeighborWorks America is a congressionally chartered nonprofit corporation,” not a government agency, said NeighborWorks spokesperson DOUGLAS ROBINSON, emphasizing that the group is aligned with the administration’s housing goals.
NeighborWorks, which provides grants and training to 250 community development groups, is usually governed by a five-person board composed of senior leaders from five different federal agencies.
“There’s concern they’re going to load the board up, get rid of officers, and install someone else to implode the organization,” one of the people said. “Slashing that organization during a housing crisis really goes against the president’s platform of creating additional homes and the ticket to the American dream.”
At the same time, Trump is escalating rhetoric against nonprofits that don’t receive federal dollars but have challenged his administration, including good governance groups.
Asked this week about whether he’d consider revoking tax-exempt status from groups beyond Harvard, Trump singled out Citizens for Responsibility and Ethics in Washington, a nonprofit ethics watchdog group. “They’re supposed to be a charitable organization,” Trump said. “The only charity they had is going after Donald Trump.”
“For more than 20 years, CREW has exposed government corruption from politicians of both parties who violate the public trust and has worked to promote an ethical, transparent government,” said CREW spokesperson JORDAN LIBOWITZ.
Meanwhile, White House officials are finalizing a set of executive orders that would revoke the tax-exempt status of environmental nonprofits, particularly those opposing oil, gas and coal development, Bloomberg reported. The move could be unveiled as early as Earth Day on Tuesday, symbolically reinforcing the administration’s fossil-fuel priorities.