Overview of the President's FY 2016 Budget



President Barack Obama unveiled his FY 2016 budget proposal Monday, a 2,000-page document offering a budget that totals more than $4 trillion.

This year marks the first time since 2010 in which the budget request has been released on time, as previous years were held up because of  delays in budget agreements. The president’s budget release marks the beginning of the FY 2016 budget process, with the fiscal year beginning in October 2015. The House and Senate will aim to establish a concurrent budget resolution this spring, which is expected to be considerably different than the president’s proposal.

Across-the-board cuts in domestic and defense discretionary spending, known as sequestration, are recommended to be averted and would be offset by revenue enhancements. The president calls for increasing the sequester cap by $75 billion in FY 2016, split between defense and non-defense spending, ultimately reaching a discretionary total slightly under $2 trillion. Also included is a six-year transportation reauthorization, costing almost $500 billion, which includes additional revenue for highway programs from a one-time charge on untaxed foreign earnings.

A Federal Funds Information for States (FFIS) report highlights discretionary and mandatory program funding differences between FY 2015 and the president’s FY 2016 proposal.

*FY 2016 funding proposals are compared to enacted FY 2015 funding levels.


Overall, the president’s FY 2016 budget would provide $23.5 billion for USDA, a slight drop from the $23.8 billion enacted for FY 2015. These funds are focused on investments in rural communities: beginning farmers and ranchers, nutrition assistance for vulnerable populations, agricultural research in key areas such as climate resilience and pollinator health and forest health.

Specifically, the budget proposes $79 million in funding to help further understand and address the decline in honeybee health. The budget also includes $200 million in funding for the Watershed and Flood Preventions Operations (WFPO) to help communities create more resilient infrastructure and natural systems. It also includes two proposals to reform crop insurance by reducing subsidies for revenue insurance policies that ensure the price at the time of harvest as well as reforming prevented planting coverage, including adjustments to payment rates.

Additionally, the budget proposes $6.4 billion in loans for direct and guaranteed farm ownership and operating loans of which a significant portion would be targeted to new and beginning as well as socially disadvantaged farmers and ranchers. The budget also includes about $4 million to support increased outreach for new and beginning farmers and ranchers.

Finally, the president’s budget proposes to adjust the way in which wildfire disaster funds are appropriated by creating a structure similar to how the Federal Emergency Management Agency (FEMA) manages other natural disasters instead of having USDA and the Forest Service borrow money from individual programs.


The president’s FY 2016 budget provides $9.8 billion in discretionary funding for the U.S. Department of Commerce (DOC), focusing on conditions for economic growth such as trade and investment, innovation, environmental intelligence.

The proposal supports trade enforcement and export promotion activities along with $1.5 billion to support the U.S. Census Bureau. It also provides strong support for the National Oceanic and Atmospheric Administration’s critical weather, research, and oceans programs, including $2 billion to fully fund the next generation of weather satellites and $147 million for the construction of an ocean survey vessel.

The budget also continues to support BusinessUSA.gov, and requests $3 million to develop an in-house “idea lab” to adopt private sector best practices and $6 million to build out a DOC digital services team to improve the delivery of information technology sources.


The president’s FY 2016 budget provides $534 billion in discretionary funding for the base budget of the Department and $51 billion in Overseas Contingency Operations (OCO) funding for a total of $585 billion to sustain the President’s national security and defense strategies. This includes a $38 billion increase over the sequestration limit, as enacted in 2011’s Budget Control Act.

The budget also calls for eliminating excess infrastructure and facilities to include requesting authority to initiate a new round of Base Realignment and Closure (BRAC) in FY 2017.


The president’s budget requests a funding level of $70.7 billion for FY 2016—an increase of $3.6 billion from the previous year.  The items listed below include new programs and/or significant adjustments to funding levels:

  • $15.4 billion in Title I funding
    • Increase of $1 billion from FY 2015
    • Title I money—the largest portion of federal education dollars for states—comes in the form of grants to assist in the education of the highest-need students
    • Meant to address growing enrollment of low-income students while simultaneously implementing new standards and assessments
  • Universal pre-K
    • $1.3 billion requested for FY 2016; $75 billion over 10 years
    • Would provide funding for preschool programs for 4-year olds from low-and-moderate income households
    • $750 million requested for Preschool Development Grants (an increase of $500 million) to assist states in setting up universal pre-K systems
  • America’s Promise—two free years of community college
    • New mandatory spending program
    • $1.36 billion requested for FY 2016; total cost of $60.3 billion over 10 years
    • Federal funding is expected to cover three quarters of the program costs; states would be expected to pick up the remaining cost without diluting other investments in higher education
  • Teaching for Tomorrow
    • New mandatory spending program
    • $1 billion requested for FY 2016; $5 billion in spending over five years
    • Competitive grant program for states and districts to undertake innovative efforts in teacher recruitment, selection, preparation, certification, and early career supports


The president’s budget for energy issues focuses more on clean energy technologies than in the past. The president specifically requested a total of $7.4 billion for clean energy technology research and development, deployment efforts, and energy-efficiency methods across various federal agencies, not just the Department of Energy. 

The budget also asks for a permanent extension of both the wind and solar production tax credits.


Overall, the president’s budget request for the Environmental Protection Agency (EPA) rose from past years with a significant portion of its budget focused on helping states meet requirements for greenhouse gas emission reduction.

Specifically, the President’s budget request proposes a $4 billion “Clean Power State Incentive Fund” aimed at encouraging states to increase their emissions reduction. Money in the fund would be provided to states that achieve early emission reduction targets or exceed their emission goals under the Clean Power Plan. States can use the money from the incentive fund to invest in different activities that “complement and advance the Clean Power Plant” such as supporting private sector energy efficiency measures and controlling pollution in low-income communities. The budget also includes a proposal that would seek to redirect a portion of future offshore drilling royalties from Gulf Coast states to programs that provide ”a fair return to taxpayers across the whole United States."”

The funding request for the Drinking Water State Revolving Fund was increased, while the Clean Water State Revolving Fund was reduced by 23 percent compared to FY 2015.

Health/ Human Services

The Affordable Care Act—The budget fully funds the ongoing implementation of the Affordable Care Act’s health insurance coverage improvements through the operation of Health Insurance Marketplaces and the premium tax credits and cost sharing assistance.

Children’s Health Insurance Program—The budget extends funding for CHIP, which ends in 2015, through 2019, ensuring continued, comprehensive, affordable coverage for these children. The proposal is paid for through an increase in federal tobacco taxes.

Head Start—Since 2008, Head Start funding has increased by more than $3.5 billion, and the budget continues these historic gains by providing over $1.5 billion in additional funding over FY 2015. This increased funding level includes an additional $150 million to expand access to high-quality early learning settings for tens of thousands of additional children through Early Head Start and the Early Head Start-Child Care Partnerships..

Promoting Upward Mobility - The budget provides $1.5 billion over five years that states and localities will be able to use flexibly to implement strategies for helping individuals succeed in the labor market and improving economic mobility. States and localities will also have more flexibility with up to four existing block grant programs in these projects.

Low-Income Home Energy Assistance Program (LIHEAP) - The budget includes $3.4 billion in discretionary funds for LIHEAP, the same as FY 2015. A new mechanism will provide additional mandatory funds triggered by significant increases in the number of low-income households, the price of fuel, or extreme cold at the beginning of winter.

Cybersecurity - The budget invests $73 million to manage and provide oversight to the Department of Health and Human Services (HHS) Cybersecurity Program. This investment is designed to reinforce and protect IT systems against the growing threats within the cyber community. This funding also supports HHS’s ability to quickly respond to evolving security threats and to better support ongoing infrastructure upgrades and ensure compliance with requirements of Federal Information Security Management Act.

Preventing Hunger - The budget provides about $9 million to allow states to streamline application and recertification processes to improve the Supplemental Nutrition Assistance Program (SNAP) access for the elderly. Pieces of this model have been used by states under waiver authority with promising results. The budget provides $1.5 million to fund the SNAP E&T (employment and training) Center for Excellence to identify and share with States proven strategies that connect SNAP recipients to work. The budget includes an additional $25 million to assist states with time limits imposed on certain non-elderly SNAP participants without children, to bolster employment and training (E&T) programs for those subject to time limits.

Homeland Security

The president’s FY 2016 budget proposes $41.2 billion in funding.

Federal Emergency Management Agency- $15.5 billion

  • National Preparedness Grant Program- $1.043 billion
  • Disaster Relief Fund- $341 million
  • Emergency Management Performance Grants- $350 million
  • Assistance to Firefighter and SAFER Grants- $670 million
  • Pre-disaster mitigation- $200 million
  • Flood Hazard Mapping- $194 million

Programs such as the such as the Urban Area Security Initiative, State Homeland Security Block Grant, and transit and port security grants—which are currently funded separately—are included in the National Preparedness Grant Program in the president’s FY 2016 budget proposal.

Customs and Border Protection- $13.6 million

  • Maintenance of infrastructure and technology along the nation’s borders- $373.5 million
  • Unaccompanied children funding- $29.1 million

U.S. Citizenship and Immigration Services- $4 billion

  • E-verify- $119.7 million

U.S. Immigration and Customs Enforcement - $6.3 billion

  • Enhance human smuggling and trafficking investigations- $25.6 million
  • Alternatives to detention to keep families together- $30.8 million

The budget proposes $1 billion to support a long-term, comprehensive strategy for Central America to minimize the pressures of illegal immigration on the United States.  It also proposes to continue the investment in border security by maintaining U.S. Customs and Border Protection (CBP) front line operations, funding additional technology and infrastructure, and expanding and enhancing intelligence and targeting capabilities. It would support 21,370 Border Patrol Agents and 26,075 CBP Officers, including over 2,300 new Officers supported by proposed increases to user fees, and includes over $373 million for the acquisition and sustainment of technology and tactical infrastructure along U.S. borders, an increase of $90 million over the current funding level.

Transportation Security Administration- $7.3 billion

  • Transportation Security Administration screening-$3.7 billion

Housing and Urban Development

The president’s FY 2016 budget provides $49.3 billion in gross discretionary funds for the U.S. Department of Housing and Urban Development to expand the number of rental assistance vouchers, increase homeless assistance for vulnerable families and make targeted investments in communities to help revitalize high poverty neighborhoods.

 This includes: funding rental housing assistance to support 4.7 million low-income families and restoration of 67,000 Housing Choice Vouchers, investing $2.5 billion for Homeless Assistance Grants, providing Public Housing Authorities with $35 million of additional funding for affordable housing services for the elderly and assisting 700 new households for persons with disabilities. It also provides $748 million to address the housing and community development needs of Native American tribes and $332 million for the Housing Opportunities for Persons with AIDS program.

The budget would also expand Moving to Work (MTW) to increase the number of public housing authorities with enhanced flexibility to make local decisions about how to operate their programs and test innovative uses of federal dollars to enhance tenant outcomes.


The president requested $13.2 billion for the Department of Interior, an increase from last year’s approved budget. Specifically, this year’s budget request focused more on the Department of Interior’s renewable energy development and permitting programs.

Additionally, the budget request proposes specific investments in climate resilience and preparedness efforts such as for national flood, coastal, wildland fire and drought resilience programs.  Regarding wildfire funding, the president is calling for a shift in wildfire funding that would provide stable funds for wildfire suppression, as has been proposed in previous budget requests..

Nearly $1 billion dollars has been requested through the Land and Water Conservation fund for sportsmen’s access, recreation activities and general land conservation programs, with full dedicated funding proposed to begin in 2017. 

The president has also proposed increased inspections and oversight on oil and gas production activities by the Bureau of Land Management.


The president proposes $28.7 billion for FY 2016, a $1.3 billion increase from FY 2015.

  • Office of Justice Programs (OJP)—$1.6 billion
    • State Criminal Justice Alien Assistance Program- $0
    • Byrne/JAG- $388 million which is an increase from $376 million
    • Second Chance Act- $120 million which is an increase from $68 million
      •  Includes $10 for a program to improve state, local and tribal probation or parole supervision efforts.
    • Community Policing Initiative—$77 million
      • Supports innovative “smart” policing efforts policing efforts, body worn cameras for law enforcement ($30 million) and building  trust between the community and law enforcement ($20 million).
    • Victims Services Programs for Victims of Trafficking—$10.5 million down from $42.25 million
      • $10 million included for human trafficking in the Crime Victims Fund
    • Economic, High-Tech and Cybercrime Prevention- $13 million


  • Community Oriented Policing Services (COPS)—$303.5 million up from $208 million



The president’s FY 2016 budget provides $13.2 billion in discretionary funding for the Department of Labor (DOL), coupled with targeted mandatory investments. Specifically, the budget request provides funding to states to help them establish paid leave programs, builds on the Workforce Innovation and Opportunity Act (WIOA) by increasing access to employment services and training opportunities, and reauthorizes the Trade Adjustment Assistance program and supports raising the minimum wage and modernizing overtime rules.

The budget also proposes steps to modernize and improve DOL’s programs and services in the following areas: Unemployment Insurance, Senior Community Service Employment Program, Information Technology, Federal Employees’ Compensation Act, Job Corps and Pension Benefit Guaranty Corporation.

Tax Provisions

The administration’s budget would raise an additional $2 trillion in revenue over the next 10 years, primarily by imposing a new fee on financial institutions, increasing the capital gains tax and limiting deductions for high-income Americans. The corporate tax would be lowered from 35 to 28 percent, with this reduction offset by broadening the tax base and eliminating a number of tax expenditures. Many expenditures included in December’s “tax extenders” package, such as the state and local deduction for sales taxes, would be made permanent. Other highlights of the include: expanding the Earned Income Tax Credit (EITC) for workers without children, implementing a tax on foreign earnings for transportation funding (discussed below) and eliminating the tax-exempt status of municipal bonds by placing a cap on the exemption for high-income earners.

In addition to these funding changes, the budget also makes three noticeable changes to bond programs impacting transportation projects. The first would be to increase the cap on private activity bonds from $15 billion to $19 billion. Second, the budget proposes a new bond called America Fast Forward bonds, which would be similar to the Build America Bonds (BABs) included in the Recovery Act. The budget also proposes creating Qualified Public Infrastructure Bonds, which would be a tax-exempt form of municipal bonds modeled on existing Private Activity Bonds, without a cap on activity level.


The president’s FY 2016 budget would provide a total of $94.7 billion in discretionary and mandatory funding in 2016 for the Department of Transportation. This includes funding for a six-year, $478 billion surface transportation program reauthorization, which would represent an increase, in annual terms, from $50 billion to nearly $80 billion. Full funding for a reauthorization is achieved by combining current funding from the Highway Trust Fund with $238 billion in additional revenue based on the enactment of a one-time transition charge of 14 percent on the untaxed foreign earnings.

Specifically, the reauthorization includes an increase of $10 billion to the Federal Highway Administration (FHWA), representing an approximate increase of 25 percent from FY 2015. Transit funding would see an increase of over $7 billion to $18 billion for FY 2016. The TIGER Program would receive $1.25 billion, up from $500 million in FY 2015 while TIFIA would maintain its $1 billion funding level.

 Additionally, the administration proposes significant new funding to states through a number of new programs including, Multi-Modal Freight Program (MFIP) that would provide $18 billion over six years to improve goods movement, Critical Immediate Safety Investments Program (CISIP) that would provide $29 billion for funding focused on the reconstruction, restoration, rehabilitation, preservation or safety improvement of existing highway assets and Fixing and Accelerating Surface Transportation (FAST) that would provide $3 billion over six years, $500 million per year, in competitive grants for state and local governments to improve strategic transportation investment decision.

Outside of surface transportation, a key point of funding for states are airport funding grants, which the budget proposes to reduce to $2.9 billion from the $3.4 billion provide in FY 2015. The budget notes that this reduction is offset in part by proposing to allow all commercial service airports to increase the non-Federal Passenger Facility Charge.

Veteran’s Affairs

The president’s FY 2016 budget requests $70.2 billion in discretionary funding for the Department of Veterans Affairs (VA) to provide needed care and other benefits to eligible veterans, their families, and survivors.  VA also received $15 billion in the Veterans Access, Choice, and Accountability Act of 2014. 

The budget continues the largest department-wide transformation in VA’s history through MyVA, an effort to reorient the VA around the needs of veterans.

Additional Resources

  • Budget of the United States Government, Fiscal Year 2016 contains the Budget Message of the President, information on the President’s priorities, budget overviews organized by agency, and summary tables.
  • To download "Budget of the United States Government, Fiscal Year 2016" as a single PDF click here (150 pages, 2.3 MB)