Artificial intelligence (AI) has climbed to the top of federal chief information officers’ (CIOs’) priority lists for fiscal year 2026, but leaders warn that without sustained funding and modern infrastructure, AI progress will stall, according to MeriTalk’s second annual Federal CIO Forecast. The findings, released today, draw on surveys and interviews with 10 federal CIO offices conducted in July and August.
Seventy percent of CIOs rank AI in their top three priorities for FY26 – up from 33% last year – and those who regularly use generative AI for work increased from 16% to 60%. At the same time, infrastructure modernization and data management moved into the top five, underscoring the “plumbing” needed to scale AI effectively.
CIOs say leadership enthusiasm is strong for AI and cybersecurity but note a significant support gap around infrastructure modernization. In the report’s priority-versus-support matrix, infrastructure ranks high for CIOs yet receives among the lowest levels of secretary backing.
“AI may be driving the vision, but it’s infrastructure that enables the mission,” said Nicole Burdette, principal at MeriTalk. “If agencies can’t get support to modernize the foundation, they’ll never deliver on the promise of smarter government.”
Budget pressures compound the challenge. Every CIO surveyed is actively cutting IT costs, and 80% face formal savings mandates. Leaders are pursuing automation, consolidation, enterprise licensing, and shared services to stretch dollars while advancing mission outcomes.
Enterprise thinking is gaining traction as a way to square those goals. Nine in 10 CIOs say adopting an enterprise mindset is good for federal IT, with one CIO noting, “More and more, we’re moving to enterprise services and enterprise contracts. As we do that, we realize true cost avoidance – and that money gets plowed back into the mission.”
Policy signals are trending positive. Eighty percent of CIOs say the new administration has positively impacted their IT strategy, though leaders stress that flexible, sustained funding models are essential to modernize at scale.
CIO recommendations to Washington include modernizing funding mechanisms, granting CIOs greater authority and autonomy, prioritizing governmentwide infrastructure and data readiness alongside AI, and incentivizing innovation and efficiency in IT programs.
For a deeper dive on federal CIOs’ plans and challenges in the year ahead, please check out the full report here.