The American Council on Education (ACE) and 48 other higher education associations have
submitted formal comments opposing a proposed federal rule that would significantly expand political appointees’ control over the awarding, administration, and termination of federal grants.
The comments respond to a
rule proposed by the White House Office of Management and Budget (OMB) in May that would rewrite the government’s longstanding “uniform guidance” governing federal grants into a binding regulation across every federal agency. The rule is not limited to research funding but would apply broadly to federal financial assistance programs across sectors including housing, healthcare, transportation, and the arts.
The public comment period closes July 13. As of this week, the proposal had drawn more than 90,000 public comments, according to
Inside Higher Ed, reflecting the breadth of concern among universities, researchers, scientific organizations, and other stakeholders.
In their letter to OMB Director Russell Vought, the higher education groups warned that the rule “would dramatically weaken the foundation of this partnership, creating structural and financial risks and adding significant instability to the ecosystem of colleges and universities that comprise American higher education.” They argue that it would shift federal grantmaking away from merit-based peer review, historically the primary method for evaluating discretionary grant applications, toward decision-making by political appointees.
“The credibility of the current federal system hinges on the fact that proposals are evaluated in terms of their quality, rigor, and potential impact, rather than political alignment,” the comments say.
The groups also warn that the rule would expand federal agencies’ authority to suspend or terminate grants mid-award for political reasons, while eliminating the administrative hearing process that currently allows grantees to appeal such decisions. The comments cite 2025 grant terminations at the National Institutes of Health (NIH) as an example of the disruption such authority can cause, noting research estimating that the $2.45 billion in rescinded NIH awards resulted in an estimated $6.29 billion in unrealized economic activity.
Beyond funding decisions for individual projects, the associations raised concern that institutions with DEI programs the administration considers unlawful could face a more fundamental risk: losing eligibility for federal funding altogether, or having active grants terminated mid-cycle. The letter notes that “none of the efforts by the executive branch over the past 18 months to imprint these vaguely defined terms into legal obligations across higher education have led to clearly understood, lawful directives,” pointing out that many such efforts remain the subject of pending litigation.
Other concerns outlined include a proposed shift from fixed-amount grant awards to a more burdensome “incurred costs” reimbursement model; new restrictions on grant funds covering publication fees, journal subscriptions, and conference costs; and an expansion of China-related research collaboration restrictions, currently limited by statute to NASA, to every federal agency.
The groups also criticize OMB’s rushed implementation timeline, warning that finalizing the rule by Oct. 1 “introduces needless systemic risk and uncertainty for all recipients of federal financial assistance.” ACE and its partners requested a 90- to 120-day extension of the comment period, which OMB denied. The associations are urging OMB to “withdraw and reconsider this proposed rule and partner with the higher education community and other impacted stakeholder groups to craft a rule that truly improves effectiveness, transparency, accountability, and fair and responsible stewardship of federal funds.”
The higher education associations are not alone in raising concerns.
Sen. Susan Collins (R-ME), chair of the Senate Appropriations Committee,
sent a letter to OMB this week requesting a 90-day extension of the comment period and asking the agency to withdraw portions of the rule she said would disproportionately harm small and rural communities and scientific and biomedical research.
Collins specifically criticized the rule’s mid-award termination provisions and a new requirement that recipients submit written justification for every payment request, which she said would create additional administrative burdens for smaller institutions and communities.
Comments on the proposed rule can be submitted through July 13 at
regulations.gov under Docket No. OMB-2026-0034.