Navigating the Fresh Landscape: How Trump-Era Policies Continue to Impact Nonprofits
Nonprofits have always adapted to changing political and economic climates. However, the shift that began with the Trump administration presented a unique set of challenges, marked by rapid changes and uncertainty. As President Trump’s second term unfolded, a focus on cutting government spending quickly reshaped the operating environment for nonprofit organizations.
The Speed of Change and Its Consequences
One of the most significant impacts was the sheer speed at which decisions were made. Jordan DeGree, executive director of the Iowa Nonprofit Alliance, noted that decisions impacting the nonprofit sector were often made “very quickly, with little or no advance warning and with a lot of consequences.” This constant state of flux made it difficult for nonprofits to effectively plan and allocate resources.
“You would wake up in the morning and you wouldn’t know if something major was going to happen that day that would derail your plans,” DeGree explained. This uncertainty hindered nonprofits’ ability to maximize efficiency – a key expectation for organizations reliant on strategic planning and careful resource management.
it’s communities that suffer when nonprofits are hampered. As DeGree points out, “Nonprofit organizations are community owned corporations, and in those instances, the community is the one that suffers as they’re not getting the most value.”
Economic Pressures and Increased Require
Beyond policy changes, broader economic trends have exacerbated the challenges faced by nonprofits. Overall prices have increased significantly since 2020, and the U.S. Inflation rate has remained above target levels. This has put a strain on American households, leading to increased demand for nonprofit services.
“You have more people trying to craft their own personal budget stretch, you have more people who are struggling or falling below federal or state poverty lines,” DeGree said. “Nonprofits that often help buoy those economic downturns are more important than ever.”
The nonprofit sector itself is a significant economic driver. In Iowa, one in eleven workers is employed by a nonprofit, contributing over $7 billion in wages annually. Any policies that restrict the growth of the sector, have far-reaching economic consequences.
Protecting Vital Funding: The Case of Victim Services
The impact of executive orders and funding cuts was particularly acute in the victim services field. Maria Corona, executive director of the Iowa Coalition Against Domestic Violence, described the initial confusion surrounding the orders. “At the most simplistic thing, what does an executive order do?” she asked, highlighting the need to understand the practical implications of these directives.
The administration targeted funding for organizations perceived as promoting “illegal diversity, equity and inclusion initiatives.” As funding cuts were announced and sometimes retracted, providers braced for potential disruptions. In April 2025, $811 million in U.S. Department of Justice grants were terminated.
ICADV joined a coalition of 21 states and victim services organizations to sue the administration over restrictions stemming from executive orders banning certain activities related to gender ideology and DEI initiatives. These conditions, they argued, would have made it impossible to comply with the Violence Against Women Act, which mandates inclusive service delivery.
A federal court issued a preliminary injunction blocking the enforcement of these restrictions in August, providing some relief. However, Corona emphasized that the threat of instability remains, leading to job insecurity and burnout among staff.
Responding to Unexpected Crises: The Food Bank of Iowa
While not directly affected by federal funding cuts, the Food Bank of Iowa experienced a surge in demand during the government shutdown in late 2025, when SNAP benefits were disrupted. Annette Hacker, chief communications and strategy officer, reported an immediate increase in food distribution, from 100,000 to 160,000-170,000 pounds per day.
The Food Bank of Iowa responded by expanding its capacity, relying heavily on volunteer support – with 49,000 volunteer hours donated in 2025. However, Hacker underscored the critical role of SNAP as the most effective hunger relief program, noting that it provides nine meals for every one provided by the charitable food system.
Agricultural policy too impacts the Food Bank’s operations, as they rely on commodity food from the USDA. Uncertainties surrounding SNAP eligibility and USDA supply chains continue to pose challenges.
Despite these obstacles, Hacker expressed confidence in the organization’s ability to adapt. “It’s our donors, our volunteers, the people who work here,” she said. “When we face these things, the answer is always just, we will find a way.”
Looking Ahead: Trends and Challenges for Nonprofits
The experiences of these Iowa nonprofits highlight several key trends that are likely to shape the sector in the coming years.
Increased Advocacy and Legal Challenges
Nonprofits are increasingly recognizing the need to engage in advocacy and legal action to protect their funding and mission. The ICADV’s lawsuit is a prime example of this trend. Expect to see more organizations challenging policies that threaten their ability to serve their communities.
Diversification of Funding Sources
Reliance on government funding can leave nonprofits vulnerable to political shifts. Diversifying funding sources – including individual donations, corporate sponsorships, and earned income – will be crucial for long-term sustainability.
Focus on Community Resilience
The pandemic and subsequent economic challenges have underscored the importance of community resilience. Nonprofits will play a vital role in building stronger, more equitable communities that can withstand future crises.
Technology and Innovation
Leveraging technology and innovative approaches will be essential for nonprofits to maximize their impact. This includes using data analytics to track outcomes, adopting digital fundraising platforms, and exploring new service delivery models.
FAQ
Q: What impact did Trump’s policies have on nonprofits?
A: The policies led to funding cuts, uncertainty, and increased administrative burdens for many nonprofits, impacting their ability to serve their communities.
Q: How are nonprofits responding to these challenges?
A: Nonprofits are diversifying funding sources, engaging in advocacy, and leveraging technology to adapt and maintain their services.
Q: What is the role of government funding for nonprofits?
A: Government funding is a critical source of support for many nonprofits, but reliance on it can create vulnerability to political changes.
Did you know? One in eleven Iowans is employed by a nonprofit organization, demonstrating the sector’s significant economic impact.
Pro Tip: Regularly review your organization’s risk management plan to identify and mitigate potential threats from policy changes and economic fluctuations.
What challenges is your nonprofit facing? Share your thoughts in the comments below!
