OMB Proposal Gives Political Appointees Final Say Over $100 Billion-Plus Federal Grants
Updated
Updated · The New Yorker · Jul 16
OMB Proposal Gives Political Appointees Final Say Over $100 Billion-Plus Federal Grants
3 articles · Updated · The New Yorker · Jul 16
Summary
Hundreds of billions of dollars in discretionary federal awards would be routed through senior political appointees under a new OMB rule, letting the White House deny or terminate grants that do not fit the president’s agenda.
The proposal would replace a system that largely relies on civil servants and peer-review panels, with OMB saying it would improve oversight even as critics call it a partisan power grab.
36 cents of every state spending dollar comes from federal grants on average, according to a former NIH program director, underscoring how the change could reshape funding for everything from arts programs to infrastructure.
Research groups warn the rule could further damage science after nearly 8,000 grants were frozen or terminated last year; roughly $1.4 billion remains unreleased, and NSF grantmaking is tracking near a 50-year low.
October 1 is OMB’s target to finalize the rule after more than 90,000 comments, potentially locking in broader presidential control over grants before the midterm elections.
How will centralizing grant approvals impact America's global leadership in innovation?
What happens to state projects when federal funding aligns with shifting national priorities?
How OMB’s 2026 Grant Rule Changes Threaten U.S. Science, Research, and Local Communities
Overview
The U.S. Office of Management and Budget (OMB) has proposed a major overhaul of federal grant rules, set to take effect in October 2026. This sweeping reform will impact nearly all federal funding for cities, towns, universities, and research institutions. While the proposal aims to simplify applications with plain language and standardized procedures, it also introduces controversial changes, such as allowing grants to be terminated mid-award and requiring written justification for every payment request. These new rules have raised significant concerns about increased administrative burdens and uncertainty for recipients, prompting widespread criticism and calls for reconsideration.