Economic Development and Revitalization Task Force Outlines Priorities for FY 2026

Dear Chair Collins, Chair Cole, Vice Chair Murray, and Ranking Member DeLauro:

As Co-Chairs of the National Governor Association’s Economic Development and Revitalization Task Force, we welcome the opportunity to provide you with our priorities as your respective committees continue to craft and consider the Fiscal Year 2026 (FY26) appropriations bills.

NGA utilizes a task force structure to ensure a streamlined, Governor-driven approach to formulate and execute on federal policy matters that are priorities to Governors. The three task forces — Education, Workforce, and Community Investment; Public Health and Disaster Response; and Economic Development and Revitalization — work in a bipartisan fashion to coordinate NGA’s work on federal policy issues.

The Economic Development and Revitalization Task Force has jurisdiction over issues in the areas of infrastructure, broadband, energy, environment, land management, technology, and taxes. Congress has been an instrumental partner for states and territories in funding efforts to help support infrastructure, economic development, and environmental programs. Therefore, as you look toward Fiscal Year 2026’s appropriations process, NGA requests that you prioritize the following funding efforts in support of:

• Surface Transportation Funding: Governors request a continued strong commitment to our nation’s transportation infrastructure by providing full funding for core highway and transit programs and having Congress adopt a bipartisan surface transportation reauthorization by the end of FY26. Funding certainty is critical as states and territories develop long-term transportation plans, and Governors applaud Congress for fully funding authorized levels of the surface transportation program over the past several years. As implementation of the program continues, Governors encourage Congress to ensure that the federal government meets its already committed obligations for federally funded projects across states, territories, and Commonwealths.
• Transportation Grant Programs: Governors support discretionary programs that fund projects of regional and national interest that are difficult to finance through traditional formula programs. For example, the following programs are critical tools for building our nation’s infrastructure: National Infrastructure Project Assistance (Mega), Infrastructure for Rebuilding America (INFRA), Rural Surface Transportation Grant Program (Rural), Bridge Investment Program (BIP), Better Utilizing Investments to Leverage Development (BUILD), Promoting Resilient Operations for Transformative, Efficient, and Cost-Saving Transportation (PROTECT), Consolidated Rail Infrastructure and Safety Improvements (CRISI), safety programs, ferry programs, and Capital Investment Grants for transit. Governors urge Congress to continue to prioritize and fund these vital infrastructure programs.
• Highway Trust Fund Solvency: Governors recognize the critical importance of the Highway Trust Fund (HTF) and the programs it supports for maintaining and improving America’s surface transportation infrastructure. We are, however, concerned about the impact of decreasing revenues, inflation, and other factors on the long-term solvency of the fund. We urge Congress to work with Governors to consider and implement sustainable funding sources and mechanisms for the HTF following a user-pays model, while avoiding overly burdensome regulatory requirements that slow crucial infrastructure investment. Governors believe that new federal mandates, regulation, and bureaucracy that go beyond the intent and statute of the Infrastructure Investment and Jobs Act will stifle efficiencies, suppress the effectiveness of the increased investment levels, and unnecessarily delay critically needed transportation improvements.
• Water Infrastructure: Governors share Congress’s ongoing concerns about aging water, inland waterway, port, and wastewater infrastructure. We commend your leadership in passing historic resources for flooding mitigation and coastal resilience as well as drinking water and wastewater projects.  NGA supports continued efforts to ensure the Harbor Maintenance Trust Fund and Inland Waterways Trust Fund receipts are dedicated for their intended purpose to ensure our ports and inland waterways are maintained at the highest level. Additionally, Governors support robust funding for flood control and ecosystem restoration.
• Permit Streamlining: Governors have advocated for the need to improve environmental reviews and unanimously adopted permitting reform as a key NGA priority. As Congress considers policy reforms to accelerate project delivery at the federal level, Governors welcome efforts to support states and territories as they grow capacity and improve their own permitting processes to assist local communities. Further, Governors support a commitment to expeditiously conduct permit reviews.
• Environmental Protection Agency (EPA) Programs: Cooperative federalism was core to the EPA’s creation in the 1970s and remains integral to its success. Over the last decades, states and territories have become the primary implementers of many of our nation’s environmental statutes, having assumed over 96 percent of the delegable authorities under federal law. However, adequate federal resources remain necessary for states and territories to fulfill these responsibilities given constrained budgets. Governors collectively call for funding state-federal programs that assist states and territories in implementing federal environmental laws such as the Clean Air Act, Clean Water Act, Safe Drinking Water Act, and Resources Conservation and Recovery Act, as well as continued funding for EPA’s State and Tribal Assistance Grants (STAG). In particular, Governors support full funding for the Drinking Water and Clean Water State Revolving Funds (SRFs) to provide long-term, long-cost loans for state and territorial projects. We are concerned about the adverse impact of Congressionally Directed Spending (CDS) on the Clean Water and Drinking Water SRFs and ask that Congress take steps to mitigate further cuts to SRF capitalization grants. Finally, Governors recognize the importance of addressing forever chemicals (PFAS) and urge Congress to provide adequate support to states and territories for remediation efforts.
• Innovation and American Competitiveness: Governors are leaders in facilitating job growth, supporting local economies, and building resilient supply chains in our states and territories. To strengthen our country’s economy and national security, we encourage Congress to prioritize funding for technology innovation that supports these efforts. For example, Governors advocated strongly for the investments in American manufacturing within the CHIPS and Science Act.
• Broadband Deployment and Access: As Governors, we understand the critical role that reliable and accessible internet connectivity plays in bridging the digital divide in our communities. Internet access is essential for telehealth, accessing education and workforce development programs, and connecting the 21st century economy. We strongly support the flexibility of federal programs to achieve the diverse needs of states as they deploy broadband capabilities.
• Economic Development Administration (EDA) Programs: EDA is the only federal agency with a mission solely focused on private sector job creation in distressed areas. EDA serves as a catalyst in helping states and territories achieve long-term economic growth, and Governors were pleased to advocate for its successful reauthorization last Congress. EDA is designed to create jobs and stimulate the economy in areas of the country that need the most help — both rural and urban — and now plays a critical role in deploying funding for regional technology hubs as part of the CHIPS and Science Act. Governors urge Congress to include robust funding for EDA in Fiscal Year 2026.
• Environmental Management: Governors express our continued support of predictable and robust federal funding for states that are home to Defense Environmental Cleanup sites managed by the U.S. Department of Energy (DOE). According to DOE’s own estimates, each year that the federal government underfunds the cleanups at the sites in our states, the completion timeline – and the expected cleanup cost of the aging facilities and infrastructure – increases by years and billions of dollars, respectively, while the potential for radioactive contamination increases. The best way the federal government can meet its obligations and protect taxpayers is to invest in the resources needed now to accelerate these cleanups.
• Sufficient Wildfire Response and Management Funding: Governors appreciate federal, state, territorial, local, tribal, non-governmental and public partners who help manage our national cohesive wildfire management strategy and effectively respond to wildfires when they occur. Governors urge flexible funding for this work at the U.S. Department of Interior and the U.S. Forest Service. Congress should also ensure relevant agencies are effectively implementing long-term wildfire mitigation strategies.

On behalf of all Governors, we thank you for your continued support of these top NGA priorities for Fiscal Year 2026, and for focusing on funding our nation’s critical needs.

Sincerely,

Cc:
Chair and Ranking Member, Senate Subcommittee on Agriculture, Rural Development, and Food and Drug Administration
Chair and Ranking Member, Senate Subcommittee on Energy and Water Development
Chair and Ranking Member, Senate Subcommittee on Interior and Environment
Chair and Ranking Member, Senate Subcommittee on Transportation, and Housing and Urban Development
Chairman and Ranking Member, House Subcommittee on Agriculture, Rural Development, and Food and Drug Administration
Chair and Ranking Member, House Subcommittee on Energy and Water Development
Chair and Ranking Member, House Subcommittee on Interior and Environment
Chairman and Ranking Member, House Subcommittee on Transportation, and Housing and Urban Development