May 29, 2026

OMB published proposed rule subjecting all federal grants to political-appointee review and requiring recipients to advance the president's priorities

On May 29, 2026, the Office of Management and Budget published a proposed rule in the Federal Register (Document 2026-10817) that would revise government-wide federal grant regulations to require recipients to "demonstrably advance the president's policy priorities," replace subject-matter peer reviewers with political appointees in the grant approval process, and authorize political appointees to cancel any federal grant award "at any point and for any reason." The rule is open for public comment through July 13, 2026, and would codify government-wide what the administration had previously imposed agency-by-agency through executive orders and individual grant-program rewrites.

Jurisdiction: federal
Location: Washington, D.C.

Abuses documented

Actors

On May 29, 2026, OMB published a notice of proposed rulemaking in the Federal Register that would revise the government-wide Guidance for Federal Financial Assistance under 2 CFR Subtitle A. The proposed rule would require every federal grant recipient to "demonstrably advance the president's policy priorities" as a condition of award, replacing the existing framework — under which Congress appropriates funds for specific statutory purposes adjudicated by subject-matter experts — with one in which senior political appointees conduct pre-issuance reviews of all grants. Peer review panels would become advisory only. The rule would also grant political appointees authority to terminate any federal award "at any point and for any reason" if the agency determines it no longer advances the administration's priorities or "national interest," regardless of the congressional purpose for which funds were appropriated.

The proposed rule further embeds cross-cutting prohibitions into all federal awards: grantees would be barred from DEI-related activities, "gender ideology," and disparate-impact liability theories, and from collaborating with covered foreign entities. Allowable costs for publication, conferences, memberships, and public communications would be significantly narrowed. The rule specifies a planned effective date of October 1, 2026, with a public comment period open through July 13, 2026. The rule, if finalized, would codify government-wide what the administration had previously imposed agency-by-agency through executive orders and individual grant-program rewrites.

Updates

2026-06-30 — Vought defended rule before House Appropriations Committee [2]

OMB Director Russell Vought appeared before the House Appropriations Committee on June 30, 2026 to defend the proposed rule. Democratic members called it "an attempt to subject all federal funding to a political litmus test."

Why we recorded this

Congress appropriates federal grant funds for specific statutory purposes; grant recipients are selected through expert peer review under criteria set by law. OMB's proposed rule would replace that framework with one requiring all grant recipients to "demonstrably advance the president's policy priorities" and authorizing political appointees to cancel any award at any point for any reason. This inverts the constitutional order — substituting executive political preference for congressional purpose and expert judgment. This archive records when the executive branch rewrites the rules governing federal financial assistance to condition congressionally appropriated funds on loyalty to presidential priorities rather than the purposes Congress specified.

Sources

Regulation for Federal Financial Assistance (NPRM 2026-10817) — Federal Register primary accessed June 30, 2026
OMB Proposes Rules Establishing Political Oversight of Grants — Inside Higher Ed secondary accessed June 30, 2026