How much could Philly lose if Trump cuts funding to cities?

PHILADELPHIA — Philadelphia received $2.2 billion from the federal government in the last full budget year, and a vast majority of the aid funded health and social services programs for the city's most vulnerable residents, illustrating the stakes as President Donald Trump has threatened to cut aid to cities.

It's not yet certain whether Trump will attempt to dramatically reduce or cut federal programs that benefit Philadelphia and, if so, whether his cuts will withstand legal challenges. City officials have said they are taking measures to prepare for the loss of federal dollars, and Mayor Cherelle L. Parker has proposed a $95 million reserve in the city budget for unanticipated federal funding losses.

So far, only one small federal grant — a $1 million environmental justice grant from the Environmental Protection Agency to the city Office of Sustainability — has been terminated in Trump's second term, city officials said last week.

But Trump, his billionaire adviser Elon Musk, and other administration officials have indicated they want to go much further. Trump has said he would like to stop federal funds from going to so-called sanctuary cities, which are local jurisdictions including Philadelphia that decline to assist federal immigration enforcement, and he recently said an executive order "to end sanctuary cities" was coming soon.

Parker has attempted to steer clear of direct confrontation with the White House, and her office has generally declined to respond directly to the president's threats. But in a recent interview, she acknowledged that losing federal aid would be dire for the city.

"We're just a little old city of Philadelphia," Parker said, "and so the potential impacts of federal cuts and what they could mean to the city of Philadelphia are grave and extremely concerning to this administration."

Here's what you need to know about federal funding for Philadelphia.

How reliant is Philadelphia on federal money?

When people talk about the size of Philadelphia's city budget, they are usually referring to the city's general fund, which is primarily funded by local taxes and pays for a majority of the costs of the city's day-to-day operations.

For instance, when Parker in early March proposed a $6.7 billion budget for the fiscal year that begins July 1, that referred to the general fund. Only $61 million, or 1%, of that would be federally funded under her proposal.

But the city maintains several other massive funds that serve specialized purposes, including the Grants Revenue Fund, which takes in money from state and federal governments and other sources that can be distributed to city agencies. Other funds include the Aviation Fund, which is sustained by fees from airport operations, and the Sinking Fund, which holds money set aside to pay off debt.

The total city budget, known as the "all funds" budget, was $10.7 billion in the last fiscal year, which ended July 1, 2024. The $2.2 billion Philly received from the feds accounted for about a fifth of the total. (The city previously said it received $2.8 billion during the 2024 fiscal year, but the Finance Department clarified Friday that the correct sum is $2.2 billion.)

Of that $2.2 billion, $379 million were one-time funds from former President Joe Biden's American Rescue Plan Act, a pandemic relief package. The city used all of its ARPA money to replace the estimated local tax revenue lost as a consequence of the coronavirus pandemic.

Many expenditures for traditional city services — such as salaries for police officers, firefighters, and trash collectors — are less vulnerable to federal cuts because they are primarily funded by money from local taxpayers.

But public health and social services programs, many of which were launched by Washington in the middle of the 20th century but are administered by state and city agencies, could be crippled if the federal funding spigot were shut off.

"Federal funding is heavily concentrated in health and human services agencies," city Budget Director Sabrina Maynard said.

Maynard also noted that Philadelphia benefits from federal aid that does not directly touch city government, from the "eds and meds" that fuel much of Philly's economy to subsidies for other government agencies to direct aid to individuals, such as the Supplemental Nutrition Assistance Program, or food stamps.

"In addition to [city] governmental operations, we have the 'eds and meds' sector that gets funding directly," she said. "The school district, PHA, SEPTA — they all get federal funding streams."

Many of those funding streams are also under attack by Trump, and those cuts could negatively impact city tax revenue. The president, for instance, has already paused $175 million in grants for the University of Pennsylvania.

Which city agencies get the most federal money?

The city Department of Behavioral Health and Intellectual disAbility Services' HealthChoices program, which provides mental health and substance abuse treatment for people who qualify for Medicaid, received $1.2 billion from Washington in 2024, by far the largest pot of federal money in the city budget.

Losing that funding could cripple Parker's high-profile effort to clean up Kensington's open-air drug market, in part by funneling people experiencing addiction into a "wellness ecosystem" that includes federally supported drug treatment services.

"When I think about potential cuts to Medicaid and Community Development Block Grant funding, how do you think we will be able to treat the people we're building a wellness ecosystem with?" Parker asked.

The Department of Public Health, which operates Federally Qualified Health Centers across the city, received $193 million from the federal government in 2024. And the Department of Human Services, which administers child welfare services, juvenile justice programs, and the foster care system, received $162 million.

The Office of Community Empowerment & Opportunity, home to anti-poverty efforts, received $18 million in 2024, and the Department of Streets took in $38 million.

Some federal money goes to independently elected branches of city government. In 2024, $18 million in federal funding went to District Attorney Larry Krasner's office, and $10 million went to the First Judicial District, Philadelphia's court system.