OMB Proposes Sweeping Changes to Federal Grant Administration

By: Galen Cobb
Thursday, June 11, 2026
The Office of Management and Budget (OMB) has released a Notice of Proposed Rulemaking (NPRM) that would fundamentally reshape how federal research grants are administered. The proposed rule targets 2 CFR – the Uniform Guidance that governs federal financial assistance – modifying 56 existing sections and adding 4 new ones. Most significantly, what has long been non-binding guidance would become a binding regulation, consolidating rule-making authority at OMB and reducing the flexibility agencies have historically exercised in administering awards. 

The NPRM contains numerous provisions with direct implications for researchers and research institutions. Among the most consequential:

• Pre-award political review [200.205(b-c)]: All discretionary awards would require approval from a senior agency appointee before funds can be obligated. Reviewers would screen proposals for compliance with content restrictions, direct appointees to favor awards to institutions with lower indirect cost rates, and require proposals to demonstrate commitment to "Gold Standard Science" as defined by Executive Order 14303. 
• Peer review authority curtailed [200.205(d)]: The rule reaffirms that peer review recommendations are advisory only and further states that these recommendations may not be "ministerially ratified, routinely deferred to, or otherwise treated as de facto binding," a direct challenge to the merit-based review processes that have long governed federal research funding.
• Expanded termination authority [200.340]: Agencies would be empowered to terminate grants at any time based on a determination that an award has failed to "effectuate program goals, Federal agency priorities, or the national interest," codifying the legal basis for the stop-work orders and grant terminations seen in the last year.
• Restrictions on international research [200.220, 200.202(e)]: Federal funds could not be used for collaborations with covered foreign countries or entities, and awards to foreign entities would require either statutory authorization or an affirmative determination by a senior appointee determination of a compelling interest tied to the agency’s mission, administrative priorities, and for the U.S.
• Publication costs prohibited [200.461]: Publication costs would be broadly prohibited, with exceptions permitted only on a case-by-case basis or where required by statute.
• Conference and journal costs restricted [200.432, 200.454(b)]: Use of award funds for conference participation would require express authorization in award terms and conditions, and journal subscription charges would become unallowable as either a direct or indirect cost.
• Multi-year awards prioritized [200.202(f)]: Federal agencies are encouraged to structure awards as multi-year grants rather than single-year awards.
• Research classification required [200.202(g)]: All scientific research awards would need to be formally categorized at issuance as basic research, applied research, or experimental development, per OMB Circular A-11.

FASEB is preparing a response to the NPRM, which will be made public upon approval by the Board of Directors. FASEB encourages all member societies, scientific organizations, and individual researchers to submit their own tailored responses. Comments should be organized by the relevant section identifier in brackets (e.g., [200.461]) and are due to regulations.gov by July 13 (Docket ID: OMB-2026-0034). Note that OMB has indicated comments on indirect cost rate negotiations, which are outside the scope of the proposed changes, will be disregarded.

When multiple respondents submit identical language, OMB may count those submissions as one comment regardless of how many people submit. FASEB encourages individual responses that speak directly to the personal and institutional impact these changes would have on research. A Substack post by Elizabeth Ginexi, PhD, provides step-by-step guidance for those looking to submit comments.