How Changes in Federal Spending Could Impact Tennessee’s Budget and Key Programs

Each year, billions of federal dollars flow into Tennessee — shaping the state’s budget, public services, and economic stability. But as federal spending priorities evolve, so too does the outlook for Tennessee’s finances and the people who depend on federally funded programs.

In a recent virtual discussion hosted by The Sycamore Institute, Mandy Spears, Executive Vice President, unpacked what current and proposed changes in federal spending could mean for Tennessee. Drawing on years of fiscal research and nonpartisan analysis, Spears explained how shifts at the federal level ripple through the state’s budget — influencing major programs like TennCare, SNAP, and the ACA Marketplace.

Federal funds make up a significant portion of Tennessee’s annual budget, supporting everything from health care access and nutrition assistance to education and infrastructure. Changes to federal policy — whether through new legislation, budget cuts, or program expansions — can directly affect the level of resources available to Tennesseans, especially vulnerable populations.

This presentation offers valuable insight into:

• The state budget context and Tennessee’s reliance on federal dollars.

• How federal actions influence state decision-making and long-term planning.

• The potential impact of federal spending changes on key safety net programs.

  
  

For a deeper dive, explore the related resources below:

• View the slides from this presentation

• Explore Federal Funding in Tennessee

• Federal Safety Net Programs in Tennessee: Enrollment and Expenditures by County

• View all federal funding work