May 29, 2026
The federal grant landscape is shifting quickly and significantly.
OMB has proposed sweeping revisions to the Uniform Guidance (2 CFR Part 200), representing consequential changes to federal financial assistance rules. The 45-day public comment window is open now, and organizations that receive federal awards need to pay attention.
Proposed Uniform Guidance Changes on the Table
- Elimination of fixed amount awards: Lump-sum grant instruments would be prohibited going forward, requiring a shift to cost-reimbursable models.
- Expanded termination authority: Agencies can now end awards at any time if they no longer align with current federal priorities, mirroring the “termination for convenience” standard used in procurement contracts.
- E-Verify for all recipients: A requirement previously limited to federal contractors is now proposed for all grant recipients and subrecipients.
- New national policy prohibitions: New restrictions on foreign collaborations, disparate-impact liability activities, and viewpoint-based event discrimination by public entities.
- Tighter allowable cost rules: Conferences, publications, memberships, fundraising, and lobbying-adjacent activities face new pre-approval requirements or outright restrictions.
- Targeted changes to indirect costs: Limitation on recovery of indirect costs to foreign organizations and foreign public entities and limiting indirect cost recovery on training grants. Also, a new pre-award provision (best practice) states that—all else being equal—preference for discretionary awards should be given to institutions with lower indirect cost rates.
- Stronger subrecipient oversight: Enhanced monitoring obligations and SAM.gov reporting requirements, with noncompliance now a potential ground for termination.
These proposals signal a major shift in how agencies will design, oversee, and manage grant awards from application through closeout. Now is the time to review your current awards, assess your exposure, and consider whether to submit public comments.
The OMB will take public comments for a 45-day period on the proposed guidance, with all comments to be submitted by July 13, 2026. Comments can be submitted at regulations.gov, referencing Docket OMB-2026-0034. The OMB stated in the preamble to the proposed changes that they expect the Final Rule to be issued by October 1, 2026. The Final Rule will include provisions for when the changes would become effective.
If you have questions about how these changes may affect your organization, Clark Nuber is here to help. Our team will continue to review the proposed guidance and provide updates as new information develops. For assistance in navigating the road ahead, connect with us to start a conversation.
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