White House OMB Director Russ Vought proposes overhaul of $1 trillion federal grant system

Office of Management and Budget Director Russ Vought announced a draft rule that would reshape the distribution of up to $1 trillion in federal grant money. The proposal gives senior political appointees final authority over grant awards and requires grantees to use the E‑Verify system and submit all announcements in English. The changes target at least 190,000 existing grants dating from the previous administration and aim to curb fraud, eliminate "woke" or non‑aligned projects, and tie funding to performance.

The rules would most affect the Department of Health and Human Services, which manages roughly $85 billion in annual grant spending, and the Department of Transportation, overseeing about $45 billion. They also impose faster reporting of fraud complaints to inspectors general and the U.S. Attorney’s office. Critics warn the shift politicizes research funding at agencies such as the NIH and NSF and may conflict with constitutional authority over federal spending. The 412‑page proposal is open for public comment for 45 days.

Supporters argue the overhaul will protect taxpayer dollars, prevent misuse by illegal residents, and align federal spending with the President’s policy priorities, including the removal of grants tied to diversity, equity and inclusion initiatives and climate‑related programs labeled as the "Green New Scam."