The White House is not proposing new funding for the Technology Modernization Fund (TMF) in fiscal year (FY) 2027, instead relying on transfer authority to sustain the government’s central IT modernization fund.
Congress created the TMF – which is run by the General Services Administration (GSA) – in 2017 under the Modernizing Government Technology (MGT) Act to provide money to federal civilian agencies for technology modernization projects.
The White House’s FY 2027 budget request – which assumes reauthorization of the TMF – includes a government-wide provision that would allow GSA, with the approval of the Office of Management and Budget (OMB), to collect “up to $100 million in funding that would otherwise be unavailable for obligation from other agencies and bring that funding into the TMF,” according to a budget document from GSA.
The approach continues a shift away from direct appropriations for the TMF and toward flexible funding mechanisms, raising questions about the fund’s ability to support larger modernization efforts.
“This provision is essential to providing the TMF with the necessary funds to help the federal government address critical technology challenges by modernizing high-priority systems, improving AI adoption, and supporting cross-government collaboration and scalable services,” GSA said.
The proposal largely mirrors the administration’s FY 2026 approach, which also did not request new funding for the TMF and instead relied on the ability to bring in unobligated balances from other agencies.
Ultimately, Congress appropriated $5 million for the TMF this year, after reauthorizing the fund through Sept. 30, 2026. In its FY 2027 budget appendix, the White House said GSA and OMB are “actively working with Congress to reauthorize the TMF” beyond that deadline.
According to GSA’s budget document, the TMF has invested more than $1.07 billion in systems upgrades and modernization projects, totaling 70 investments across 35 agencies. It has received and reviewed over 290 proposals totaling about $4.5 billion in funding demand, representing a 24% acceptance rate.
“Without the additional transfer authority requested in the government-wide general provisions, the TMF will continue shepherding investments with available resources, but will not be able to tackle larger-scale investments needed to advance policy priorities, or meet the significant demand shown for the fund,” GSA said.
Until Congress acts on reauthorization and funding structure, the scope and predictability of TMF-backed investments – particularly for larger modernization efforts – remain uncertain heading into FY 2027.