White House Issues Executive Order on Oversight of Federal Grants

By: Yvette Seger
Wednesday, August 13, 2025
On August 7, the White House issued “Improving Oversight of Federal Grantmaking,” an Executive Order (EO) intended “to improve the process of Federal grantmaking while ending offensive waste of tax dollars.” The EO is the latest attempt to subvert existing agency peer review processes while increasing executive influence in determining whether projects are funded or terminated.

The EO takes a three-pronged approach. Section 3, Strengthening Accountability for Agency Grantmaking, centers around the designation of a “senior appointee” (defined as “an individual appointed by the President, a non-career member of the Senior Executive Service, or an employee encumbering a Senior Level, Scientific and Professional, or Grade 15 position in Schedule C of the excepted service”) to review and approve agency funding announcements and discretionary awards to ensure consistency with applicable laws, agency priorities, and national interest.

Section 4, Consideration for Discretionary Awards, further consolidates oversight by designated senior appointees, encouraging them to “not ministerially ratify or routinely defer to the recommendations of others in reviewing funding opportunities announcements or discretionary awards…” This includes ensuring discretionary awards “demonstrably advance the President’s policy priorities,” and “not be used to fund, promote, encourage, subsidize, or facilitate a) racial preferences or other forms of racial discrimination by the grant recipient; b) denial by the grant recipient of the sex binary in humans or the notion that sex is a chosen or mutable characteristic; c) illegal immigration; or d) any other initiatives that compromise public safety or promote anti-American values.” This section also expresses a preference for awards being made to institutions with lower indirect cost rates and a broad range of recipients rather than a select group of repeat players.

Section 5, Revisions to the Uniform Guidance, directs the Office of Management and Budget to revise the Uniform Guidance “to further clarify and require all discretionary grants to permit termination for convenience, including when the award no longer advances agency priorities or the national interest.” This section also seeks revisions to limit the use of grant funds for costs related to facilities and administration. Section 6, Implementation and Termination Clauses, builds upon the requested changes to the Uniform Guidance by requiring agencies to review and update their standard grant terms and conditions, specifically pertaining to the ability to terminate awards for convenience. This review is due within 30 days of the EO.

A fact sheet was issued in conjunction with the EO.