July 13, 2026
Director Russell Vought
Office of Management and Budget
717 17th Street NW
Washington, DC 20503
Docket No. OMB-2026-0034
Re: Regulation for Federal Financial Assistance
Dear Director Vought,
National Taxpayers Union, the nation’s oldest organization representing the interests of taxpayers, appreciates the opportunity to comment on draft regulations for Federal Financial Assistance recently proposed by the Office of Management and Budget.
We agree with the general premise underlying this rulemaking process, and support efforts to reform the current wasteful, flawed, and politicized federal grantmaking process. However, we believe that the current draft regulations are in need of significant revision to avoid the possibility of increasing future politicization of federal grants in ways that could increase wasteful spending.
This draft regulation proposes a series of large changes in the federal grant making process, including adding a pre-approval process that requires senior political appointees to approve awards prior to issuance. While this has informally been in place for decades now, the addition of this formal political step has become controversial. Another provision of concern to many is giving agencies the ability to terminate awards if they no longer serve agency or administration priorities. Other proposals in the proposed regulations are more customary, though still opposed by a number of organizations. These include moving towards a cost-reimbursement model for future awards, expanding unallowable costs, disallowing future grants from supporting any initiatives involved with diversity, equity, inclusion or “gender ideology”, and adding “viewpoint-neutrality” requirements on organizations that receive federal financial assistance.
Many in the national research community have reacted negatively to these draft regulations. However, there is a clear need to reform the current federal grant environment. Institutions involved in the selection of awardees have misspent taxpayer dollars on grants and other projects that frequently served the interests of small segments of the population, and not all taxpayers. This problem was made worse during the Biden Administration, which used executive orders and other tools to advance measures supported by a limited percentage of the public.
Nonetheless, the proposal’s requirement of political appointee approval for future grants could ultimately steer the grantmaking process toward overtly political goals, likely limiting the quality of future federal grantees and the efficacy of their work product.
We support making the review process more transparent, which is likely helping to drive the current draft regulation. However, strong research takes time to develop, build, and implement. This timeline generally spans a period longer than a typical presidential administration. Also, particularly in hard sciences like physics, biology, or medicine, politics can be left at the front door. There is no liberal or conservative way to cure cancer, or to create a new propulsion system to reach Mars. In cases like this, it would be better to build a system immune from political meddling, both from the government and from biased universities and other non-viewpoint neutral institutions.
In many cases, federal financial assistance represents a waste of taxpayer funds. Federally-funded research has sometimes achieved important scientific goals, but also has been a source of delayed or even harmful results to the health of Americans. Rather than focusing on adding a layer of political review to federal grantmaking, draft regulations should add limitations to federal financial assistance in general. With our current federal debt level now higher than the American gross domestic product, it could be better for taxpayers to limit this funding, rather than just making it more transparent.
Thank you for your efforts in drafting proposed regulations that aim to remove waste and abuse in the federal financial assistance process. Several provisions in this draft rulemaking are pro-taxpayer, including proposed limitations on allowable costs. However, we urge further revisions to ensure this draft can truly achieve its intended purpose. We stand ready to support your efforts to revise these regulatory proposals, and would welcome the opportunity to engage on this important issue.
Sincerely,
David Timmons
Senior Policy Manager
National Taxpayers Union
dtimmons@ntu.org