Two manufacturing programs face challenges in new federal budget
One would be reduced by more than 50 percent from current levels, while the other would be eliminated entirely.
CORRECTION: According to IACMI’s Mark Morrison, the Manufacturing Dive article referenced below was inaccurate. He says the organization receives no funding from the Department of Commerce, but rather the Departments of Energy and Defense.
We regret the error.
A recent report in Manufacturing Dive from a budget hearing for the U.S. Department of Commerce provides some insights on two programs – one on the chopping block and the other that would face significant cuts from current funding levels.
- The proposed budget for FY26 would cut the Manufacturing USA program’s funding by more than half, down from an estimated $76 million in FY2025 to $37 million. That level, which is still above the FY2024 budget of $28 million, includes the Knoxville-based Institute for Advanced Composites Manufacturing Innovation, better known as IACMI – The Composites Institute.
- According to the article, Commerce Secretary Howard Lutnick said the budget proposal would eliminate all funding for the Manufacturing Extension Partnership (MEP) program.
In April, the Trump administration announced it would cut funding for 10 MEP programs, but walked its decision back following pushback from lawmakers and advocates. It has since been unclear whether funding will continue for the other 41 programs.
The proposed budget offered some clarity, stating that it does not provide funding for the MEP program.
When asked by lawmakers how the Commerce Department plans to replace the assistance provided by the program to small- and medium-sized manufacturers, Lutnick said the agency is looking to “reexamine and retool” outdated programs to be better suited for the artificial intelligence-driven industry of the future.
“Our department is very focused on making sure we’re bringing our manufacturers the best tools, and we’re examining them,” Lutnick said. He highlighted the need to retain the concept of MEP, but to “fix the waste, fraud and abuse” taking place, including inflated salaries for program leadership.
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