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Despite President Trump initially proposing $12 billion in cuts to the U.S. Department of Education, the approved at the beginning of February largely maintains existing K-12 federal education funding levels. But his 2027 budget proposal reopens this issue, calling for $6.6 billion in . Even if these direct cuts to federal education funding again fail to pass, critical funding for teachers and students will still be at risk. States rely on federal funding in areas outside education, and state revenues from income, sales, and other taxes are tied to economic health. Any cuts to federal funding for states or policy changes that impact state economies could squeeze budgets, creating problems for state education spending and threatening the resources available for students and classrooms.

States are facing these difficulties today. The Trump administration has slashed spending on Medicaid and SNAP, constraining state budgets. Further, large and inconsistent tariffs, wars that affect energy prices, and aggressive immigration enforcement are . This could , as job losses lower income tax collections and reduced consumer spending shrinks sales tax revenues. States may be forced to raise taxes or cut spending. In the absence of specific protections for education spending in state law, school district budgets could end up on the chopping block. 

In a fellowship with �鶹������ý, I researched risk factors facing state education budgets in the six New England states: Maine, Vermont, New Hampshire, Massachusetts, Connecticut, and Rhode Island. That work points to four important questions that education advocates in every state should be asking this summer as they prepare for budget season. 

Cuts to Medicaid and the Supplemental Nutrition Assistance Program (SNAP, commonly known as food stamps) pose particular threats to state budgets. 

The Medicaid program is the for states. H.R.1, the “One Big Beautiful Bill Act,” makes significant changes to the Medicaid program, enacting work requirements, lowering the cap on provider taxes, and implementing stricter eligibility rules. The health care policy research firm KFF estimates this will reduce federal by $911 billion over the next decade. Cuts will force states to take one of three courses: Reduce benefits or eligibility, raise revenues by increasing taxes, or pull funding from other priorities, like public education. 

SNAP is the nation’s largest anti-hunger program, on a monthly basis. With new cuts to SNAP, all states would now be responsible for an increased share of administrative costs, and most will have to cover a portion of benefit costs as well. Georgetown’s Center on Poverty and Inequality estimates that states’ spending on SNAP will increase by roughly 200 percent on average, with . In Maine, for example, the state cost share will jump from $13.8 million to over $75 million, a 444 percent increase. As with Medicaid, states will have to either raise revenues, limit access to SNAP, or divert spending from other areas like education to meet these cost increases. The cuts also threaten student access to free meals, a key support for food-insecure students, since many are automatically eligible for these meals by virtue of being enrolled in SNAP. 

Beyond these direct effects, Medicaid and SNAP cuts may also indirectly constrain state budgets. Every federal dollar spent on generates more than a dollar in economic activity, and the converse is true for cuts. The Commonwealth Fund projects that state GDPs could decrease by $154.3 billion and that nationwide due to the economic contraction associated with the cuts. In addition to the pressure this could put on school district budgets via lost state tax revenue, these economic impacts may lead to increased student need as families experience job loss and other financial pressures. 

Another looming risk to education funding is the possibility of a recession triggered by federal policies like tariffs, immigration raids, and geopolitical conflict. An economic downturn would reduce state income and sales tax revenues, potentially pressuring legislators to make cuts to education spending. 

States will be less at risk if they have built robust rainy day funds, which can provide a buffer against budget cuts during a recession. : In fiscal year 2024, New Jersey only had enough funds to cover two days worth of operational expenses, while Wyoming could cover over 300 days. The median state had enough funds to cover roughly 49 days of state operations. Education advocates should be asking whether existing reserves are sufficient to withstand fiscal shocks and maintain consistent support for students and school systems.

Advocates should also consider —what portion of funds come from revenue sources that tend to be reliable, like property and sales taxes, or that tend to fluctuate, like corporate income taxes. They may also want to ask whether their state is following best practices for , such as regular budget stress tests to inform long-term planning.

States can protect K-12 education from spending cuts in a variety of ways. At the most basic level, an established state constitutional right to education can deter legislators from making cuts, as they may open the door for . In theory, state funding formulas are a statutory commitment to ensure adequate funding, but states .

Some states have enacted protections on the revenue side as well, by dedicating particular revenue streams to K-12 education. As one example, Massachusetts passed the Fair Share Amendment in 2022, creating a that is dedicated to education and transportation. Earmarked revenue streams can help insulate K-12 funding by placing at least a portion of education funding outside the political appropriations process. 

However, earmarking does not prevent revenues from declining during a recession. Massachusetts legislators have tried to mitigate this risk by placing 15 percent of all excess revenue from the Fair Share surtax in the Education and Transportation Reserve Fund. Advocates should ask what similar mechanisms exist in their state, if any, and the extent to which education funding is protected from—or vulnerable to—a downturn. 

Beyond the external budget pressures posed by federal cuts, states also face internal constraints. A significant portion of state funding is restricted and/or mandatory, leaving policymakers with limited flexibility to respond to new fiscal pressures. In Connecticut, for example, fixed costs—expenses the state must legally or contractually pay, like entitlement programs and debt service payments—make up 54 percent of the state’s General Fund, its primary operating fund. When these costs grow faster than state revenue, this puts more pressure on the budget. This is a trend—the current share of committed funding has only increased since 2000, when fixed costs made up just 35% of the General Fund budget. 

Advocates should ask what portion of their due to legal and contractual restrictions and thus unavailable to shift towards emergent fiscal needs. They may also want to consider how state-specific fiscal rules (like Connecticut’s spending cap) can constrain funding available for education. 

There is still significant uncertainty around the future of federal education funding. At the same time, federal policies outside of education that directly constrain state budgets (like Medicaid cuts) or increase the risk of a recession (like tariffs) may place additional pressure on state finances, threatening state spending on education. Funding cuts could lead to teacher layoffs, larger class sizes, and wider achievement gaps between high- and low-income school districts.

As states enter the FY2027 budget cycle, state policymakers and education advocates should take a clear-eyed look at risks to their education budgets from federal cuts and other policy changes. This includes understanding how Medicaid and SNAP cuts will constrain their state’s budget, recognizing what protections exist for K-12 education funding, and evaluating whether their state has sufficient budget reserves and fiscal flexibility to weather economic volatility while prioritizing education funding. The answers to these questions could determine whether students have the resources and support they need.