Every region in America is chasing the same federal dollars.
NSF Engines. EDA Tech Hubs. SBA Regional Innovation Clusters. They all stem from a multibillion-dollar federal push to transform American innovation for decades to come.
If you’re an ecosystem builder waiting for government funding to save your region, you might be building on sand.
The reality? Most of that money was never appropriated. The programs are designed for long-term ecosystem building. The funding process guarantees short-term chaos.
On Jan. 8, the House passed a “minibus” appropriations package, the clearest picture yet of where federal innovation priorities are heading.
The good news: Congress rejected the administration’s proposed 55% cut to the National Science Foundation (NSF). The bad news: innovation programs still face real constraints — and the math doesn’t work for everyone.
The programs that survive today aren’t the ones you think. And if you’re an ecosystem builder waiting for government funding to save your region, you might be building on sand.
The numbers that matter
The minibus covers three of the twelve appropriations bills, overseeing the Commerce, Justice and Science agencies. These are the bills that fund most federal innovation programs, and they highlight a key pattern in the budget:
- Programs with technology and national security framing are largely protected.
- Programs framed around workforce or economic distress without an explicit tech connection remain vulnerable to cuts.
- Programs entangled in authorization disputes or unresolved appropriations remain frozen.
Here’s what’s in them.
NSF: $8.75 billion
Congress protected the agency from devastating cuts and added an important guardrail: No directorate can receive more than a 5% reduction from fiscal year 2024 levels. This means the Technology, Innovation and Partnerships (TIP) Directorate — home to Regional Innovation Engines — has explicit protection against disproportionate cuts.
NSF Regional Innovation Engines: Up to $200 million
That’s a ceiling, not a floor. NSF has nine funded engines with funding needs increasing from $7.5 million to $15 million per year as they mature, plus 15 finalists from the second competition expecting awards in early 2026 — all competing for that same $200 million pool.
This only guarantees one year of funding. The new finalists were supposed to get two-year awards, and the existing engines were expected to have three-year awards.
Economic Development Administration Build to Scale: $50 million
The House passed level funding for the program supporting tech entrepreneurs. All $150 million accumulated across fiscal years 2024 to 2026 may be available for the next NOFO, or notice of funding opportunity, this spring.
Tech Hubs: $41 million base
Authorized at $10 billion over 10 years, the EDA effort received only baseline appropriations — “enough for two implementation grants,” according to the minibus. With 31 designated Tech Hubs competing for funding, that’s a far cry from the $504 million awarded to just 12 of them in 2024.
Manufacturing Extension Partnership (MEP): $175 million
Congress directed that “no funds are provided to execute or plan for a program that reduces the number of active MEP Centers” and required that at least 85% of funds go directly to these centers.
The cuts that tell the story
The best ecosystem builders have options.
When federal programs offer uncertainty, compliance burden and annual existential crises, talented people leave for foundations, corporations or the private sector. The programs that need the best talent are structurally designed to repel it.
The Good Jobs Challenge was eliminated. Career pathways for workers in distressed communities? Gone.
The recompete Pilot, designed for persistently distressed communities, was cut by 56%. Funding dropped from $41 million to $18 million.
Congress created a replacement to the New Workforce Training Grants at one-quarter the size.
The message: Technology framing protects funding. Workforce-only framing does not.
What’s still uncertain
Six appropriations bills remain unresolved and are operating under a continuing resolution through Jan. 30. This affects several programs that ecosystem builders care about.
For SBIR/STTR, authorization expired Oct. 1, 2025. No new solicitations will be accepted until reauthorization. This affects more than $4 billion in annual seed funding across 11 agencies.
Regional Innovation Clusters, FAST and Growth Accelerators, falling under the purview of the Small Business Administration, also remain unresolved.
When you don’t know if your funding will continue, you don’t take risks. You don’t launch the ambitious initiative. You don’t hire the full team. You play it safe, which defeats the entire purpose of innovation programs.
What this means for ecosystem builders
Here’s the fundamental mismatch: Congress designed these programs for a 10-year regional transformation.
NSF Engines are funded for up to a decade. Tech Hubs were authorized at $10 billion over 10 years.
Yet we’re watching their fate decided through annual appropriations battles, continuing resolutions, and a 43-day shutdown.
You cannot build a 10-year innovation ecosystem on one-year funding cycles. The regions that will succeed aren’t waiting for federal funding. They’re building partnership infrastructure that can activate federal, state, corporate and philanthropic resources simultaneously — because no single source is reliable enough to bet a decade on.
Right now, the minibus has bipartisan support, but earmarks remain a sticking point. We’ve already lived through a shutdown, and six appropriations bills remain unresolved before the Jan. 30 deadline.
The only thing more expensive than not getting federal funding is building your entire strategy around funding that arrives late, gets cut or never comes at all.
