OMB proposes sweeping overhaul of federal grant regulations

On May 29, 2026 the Office of Management and Budget released a proposed rule in the Federal Register that would replace the current Uniform Guidance with a binding Uniform Grants Regulation. The change is intended to improve transparency, accountability and reduce the burden on recipients while aligning federal assistance with presidential priorities.

The draft gives senior political appointees authority to pre‑issue review all discretionary awards and allows agencies to terminate grants at any time if they are deemed no longer in the national interest. It also expands the scope of prohibited uses of grant funds, banning support for activities that the administration labels as DEI initiatives, gender‑affirming care, certain abortion‑related work, voter‑registration efforts, any effort that “denies the biological reality of sex,” and content deemed “anti‑American.” Restrictions on advocacy, eligibility of some nonprofits and international collaboration are also included.

The public comment period runs until July 13, 2026, after which OMB expects to issue a final rule by October 2026.