According to a report from the Montana Nonprofit Association, local governments are among many recipients of federal funding in the state. They receive about $361.3 million annually in federal contracts, grants, loans and direct payments. (Adobe Stock)

A new report showed Montana receives a larger share of federal funding than the national average and the effects of continued cuts could be “dramatic.”

For every dollar Montana contributes in federal taxes, the state receives $1.40 in return, according to the Montana Nonprofit Association report. In 2024, it totaled more than $14 billion disbursed, a number trending down in 2025 as President Donald Trump and Elon Musk make more cuts in the name of government efficiency.

Adam Jespersen, executive director of the Montana Nonprofit Association, warned “even microreductions would have dramatic impacts.”

“We’re all for eliminating waste, fraud, and abuse,” Jespersen acknowledged. “But those conversations need to be had with care, with planful action and with communication around the ‘what’ and the ‘why’ and the ‘how.'”

Federal funds reach Montanans through federal jobs, nonprofits, social programs and state and local government revenue, as well as the services they provide. It includes aid to schools, farms, housing, infrastructure, health care and more.

There are more than 650 nonprofits in Montana employing more than 60,000 people, or nearly 12% of the state’s workforce. Among those organizations, 64% would be in financial peril without government funds, according to the report. Jespersen called the early cuts a “canary in the coal mine.”

“Because those impacts are de minimis compared to other impacts that may come from cuts to social security, to Medicaid, to education, to local government, things like that,” Jespersen explained.

Cuts could affect rural Montana in more ways, as 89% of Montana counties are more reliant on Social Security and veterans benefits than the national average, as are 86% of counties on Medicare.

In line with tribal treaty rights, 58% of revenue to tribal governments in Montana came from federal funding between 2003 and 2009.