Small charities that lost government funding in 2025 lost a median 28% of their revenue, Urban Institute finds
Two reports from a national survey of 2,328 charities find that 35% of nonprofits had at least one government funding disruption last year. Larger groups were hit more often; the smallest lost the most when money was cut.
Median share of total revenue lost in 2025, by annual expenses
Washington. Small charities were the least likely to have their government funding disrupted in 2025, but those that lost it lost far more of their budgets than larger organizations did, according to two reports the Urban Institute released on Oct. 14.
Among nonprofits with annual expenses of $50,000 to $99,999 that lost government funding, the money lost was a median 28% of total revenue. For organizations with $1 million to $9.9 million in expenses it was 5%, and for those with $10 million or more, 9%. Nearly a third of the smallest group that lost funding lost half or more of their revenue.
Disruptions were widespread
The reports draw on the National Survey of Nonprofit Trends and Impacts, answered by leaders of 2,737 charities in spring 2025 and 2,328 between January and April 2026. The survey covers 501(c)(3) public charities with at least $50,000 in annual expenses and revenue, and leaves out hospitals, schools, universities, houses of worship and foundations. Researchers from the Urban Institute, American University and George Mason University wrote both reports.
By the end of 2025, 35% of nonprofits, and 49% of those that received any government funding, reported at least one disruption: lost funding, a delay, pause or freeze, or a stop-work order from any level of government. The share rose with size, from 20% of the smallest organizations to 55% of those with $10 million or more in expenses. Nearly half of the organizations with delays had at least one that lasted 12 weeks or longer, and 11% still had a delay unresolved when they answered the survey in early 2026.
Cuts to staff and services
Organizations hit by disruptions most often cut expenses, drew on reserves, raised more from donors and foundations, or borrowed. The companion report finds that 30% of disrupted nonprofits with paid staff reduced their number of employees in 2025, against 20% of all staffed nonprofits, and that 45% of disrupted organizations met demand for their services, against 52% overall. The share of staffed nonprofits planning to hire in the following year fell from 57% in late 2024 to 38% by spring 2026, a decline not limited to organizations with disruptions.
“It's hard to plan for future hiring when they don't know if there will be funding for those positions.”
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