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Dear Ken,

Last week, the Office of Management and Budget (OMB) released a proposed rule that could significantly change how federal grants and cooperative agreements are awarded, managed, and terminated across the federal government. The proposal revises the "Uniform Guidance," the government-wide framework that governs federal financial assistance, including research grants at NIH, NSF, CDC, BARDA, ARPA-H, and other federal agencies. Public comments are due July 13, and OMB intends for the rule to take effect October 1, 2026. Once a rule is finalized, it has the force of law.

Examples of some of the consequential changes OMB is proposing include:

• Political review of every discretionary grant: The proposal would require agencies to designate senior political appointees to conduct pre-issuance reviews of discretionary grant awards to ensure alignment with Administration priorities and applicable executive orders.  
• Expanded authority to terminate grants: Agencies would be given broad authority to terminate grants after they are awarded if they are determined to no longer align with agency priorities, program goals, or the national interest. 
• New restrictions on international research collaboration: The proposal would prohibit agencies from issuing research and development awards directly to foreign entities unless specifically authorized by statute or approved by senior leadership. Some foreign subrecipients and contractors would still be permitted under certain circumstances. 
• Restrictions related to scientific exchange and publications: The proposal would require prior federal agency approval for conference attendance costs and would make publication costs, including article processing charges and open access fees, unallowable unless specifically pre-approved in the award.  
• Additional compliance and oversight requirements: The proposal includes expanded applicant and award recipient review criteria, additional reporting and oversight requirements, mandatory E-Verify participation for recipients and subrecipients performing work in the United States under federal awards, and provisions tied to several executive orders issued in 2025, including restrictions related to DEI activities. 
• Changes to award structures: The proposal would eliminate fixed amount awards and prohibit fixed amount subawards government wide. 

The proposal does not include a government-wide cap on indirect cost reimbursement rates, an approach the Administration previously pursued through NIH and which was later blocked in court.  However, indirect cost reimbursement could be factored into the political review phase of the grantmaking process.  

Research!America will be holding a special member-only alliance discussion on the proposed rule on Zoom this Wednesday, June 3 from 12:00 p.m. to 1:00 p.m. ET. To register, use this link or email JLagoy@researchamerica.org. Feel free to share this invitation with colleagues within your organization. 

Please note that this meeting is not open to the press, and all discussion by the speakers and questions are off the record and not for attribution. Registration is limited to individuals from Research!America member organizations. 

All the best, 

Ellie

Eleanor (Ellie) Dehoney

Senior Vice President, Policy and Advocacy

Research!America

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