National Institute of Food and Agriculture Formula Grants

(NIFA Formula Grants)

Department of Agriculture

Proposed Cut

$510M

% Reduction

75.0%

Action Type

reduction

Who Is Served

Land-grant universities in all 50 states; Cooperative Extension offices in ~3,000 U.S. counties; agricultural researchers

Summary

NIFA Formula Grants, also called capacity grants, are yearly federal funds that the U.S. Department of Agriculture sends to land-grant universities using set legal formulas (such as the Hatch Act for research and the Smith-Lever Act for Cooperative Extension). This proposed FY2027 change would cut the program by $510 million, a 75% reduction, with the administration saying it wants to focus remaining dollars on the highest-priority agricultural research.

Who Is Affected

The cut would hit land-grant universities in all 50 states, their state agricultural experiment stations, and the Cooperative Extension offices located in most of the country's more than 3,000 counties. Because these funds usually require states and universities to put up matching dollars, a 75% federal cut would also reduce the state and local money that is tied to it, affecting farmers, ranchers, 4-H youth programs, and rural communities that rely on Extension staff for practical, research-based help.

What this cut would actually mean

With three-quarters of formula funding gone, universities would likely lay off researchers and Extension agents, close or shrink county offices, and end long-term farm and food studies that competitive grants do not usually cover. In real terms, fewer local experts would be available to help growers manage pests, diseases, droughts, and soil health, and everyday services like farm advice, nutrition education, and youth programs in many rural counties would be reduced or disappear.

Why this hits Alabama harder

About 42% of Alabama's population lives in rural areas, more than double the roughly 20% national rural average, so Alabama depends heavily on the Cooperative Extension offices and agricultural research this program funds. Alabama is also one of the few states with three land-grant institutions -- Auburn, Alabama A&M, and Tuskegee -- meaning it draws more formula-grant dollars per person than most states, so a 75% cut would hit its rural farmers, extension agents, and researchers harder than the U.S. average.

At A Glance | Alabama Department of Public Health (ADPH) — States that 2,123,399 residents, or 42.3% of Alabama's population, live in rural areas, based on 2022 Census Bureau data.
Nation's Urban and Rural Populations Shift Following 2020 Census — U.S. Census Bureau data showing the national rural population was about 20.0% in 2020, far below Alabama's rural share.
Alabama Cooperative Extension | NIFA — USDA NIFA page confirming Alabama Cooperative Extension System receives NIFA formula-based funding tied to its land-grant institutions.
USDA Awards AAMU, Alabama Cooperative Extension $950,000 in Grants — Reports on USDA grants supporting Alabama A&M University and the Alabama Cooperative Extension System, illustrating reliance on federal agricultural funding.

Sources

Capacity Grants | NIFA | USDA — USDA's National Institute of Food and Agriculture describes formula-based capacity grants (Hatch Act, Smith-Lever Act) that support research and extension at land-grant institutions through payments to states.
The U.S. Land-Grant University System: Overview and Role in Agricultural Research (CRS Report R45897) — Congressional Research Service report explaining that capacity (formula) grants are allocated to states by statutory formula, often require nonfederal matching, and support Cooperative Extension offices in most of the more than 3,000 U.S. counties.
The Agricultural Cooperative Extension System: An Overview (CRS Report R48071) — Congressional Research Service overview of how Smith-Lever formula grants fund the Cooperative Extension System, including the statutory formulas and state matching requirements.