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Unions and nonprofits ask Congress to keep blocking OMB's rewrite of federal grant rules after Dec. 11

In a letter to congressional leaders, 47 organizations ask that the stopgap law's ban on the proposed rule be carried into every later funding bill for fiscal 2027. They say small nonprofits would be among the grantees most at risk.

A gloved hand holds a small plastic test tube while the tip of a pipette draws liquid from it, in a laboratory
A researcher at the National Human Genome Research Institute draws DNA from a test tube. Federally funded research is among the work the letter says the rule would reach.National Human Genome Research Institute

Washington. Forty-seven unions, advocacy groups and nonprofits have asked the leaders of Congress to keep the Office of Management and Budget from putting its proposed overhaul of federal grant rules into effect. The ban now in law runs only through Dec. 11, when the current stopgap spending law expires.

The letter, dated Oct. 26 and reported by FEDweek on Nov. 4, went to House Speaker Mike Johnson, Senate Majority Leader John Thune, Democratic leaders Charles E. Schumer and Hakeem Jeffries, and the four top members of the House and Senate appropriations committees.

What the letter asks

Section 157 of the Continuing Appropriations and Extensions Act, 2027 bars OMB from issuing or finalizing its proposed Regulation for Federal Financial Assistance through Dec. 11. The signers want that section carried into any later continuing resolution, omnibus or full-year spending bill for fiscal 2027.

They also ask Congress to widen it, so that no money may be used to develop, issue, finalize, implement or enforce the rule "or any substantially similar policy, guidance, directive, or agency-level workaround," to protect peer review, and to hold oversight hearings before any government-wide change to federal grants. The letter notes that the Senate passed the measure 90 to 6 and the House agreed 370 to 48.

Why nonprofits are named

Under the proposal, senior political appointees would review discretionary awards before they are made, peer review recommendations would become advisory, and officials would consider whether awards "demonstrably advance the President's policy priorities," the letter says. Because the rule revises the Uniform Guidance, which covers nearly all federal assistance, the signers say it would reach medical research, public health, education, veterans' services and "state, local, Tribal, and nonprofit programs."

The letter warns that agencies could suspend or end awards that officials decide no longer serve agency priorities, and could judge applicants on a "history of questionable practices" and their affiliations. Grantees that build programs over several years, it says, including "small nonprofits with limited administrative capacity," would be especially vulnerable.

The signers include the unions AFT, the National Education Association, the Service Employees International Union and the National Federation of Federal Employees, and nonprofits such as the Union of Concerned Scientists, the Natural Resources Defense Council, the National Parks Conservation Association, the Center for Science in the Public Interest and the Coalition on Human Needs.

Congress must pass another funding measure by Dec. 11 to keep the government open. Unless that bill repeats Section 157, OMB will again be free to finalize the rule.

About this story

501c3.help wrote this story from the sources listed with it, not from material an organization sent. Our editors approved it on Nov. 5, 2026. Stories in The Nonprofit Herald are free, and nothing is asked in return. Editorial rules.

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