Federal Grant Process Gets Centralized Political Oversight
Significant new uncertainty for federal grants
Federal Grant Process Gets Centralized Political Oversight
Significant new uncertainty for federal grants
On August 7, President Trump issued an Executive Order routing all federal discretionary grants through senior political appointees, with the power to kill them midstream if they stray from administration priorities.
The EO also bans funding tied to “anti-American values,” and aims to cap the amount of grant funds that go to overhead.
This also creates two major shifts to consider.
Lower Net Present Value
First, a long-term grant becomes worth less to you today.
If there’s a decent chance you might not actually receive every year of a grant that looks big on paper, it’s worth less to you in real life.
You plan like it’s smaller, spread funding across more sources, and front-load work.
Policy as Platform
Second, expansions of executive power persist.
Looking further into the future, presidents of both parties will have more tools to align the award of discretionary funding with their priorities.
Options for the Risk Exposed
Those with significant exposure to federal grant revenue have pivots to consider accelerating, including:
Portfolio Prophylaxis. Limiting exposure to any single federal discretionary funding stream or agency, and to elevate state/local funds and private revenue.
Show Your Work. Prospective grantees that have open protocols, clear replicability and auditable data processes are better positioned now.
Armor Contracts. Language that seemed boilerplate will be a focal point for negotiating; step-down termination costs, IP retention, and more.
FOA Fluency. Reading for screening words matters even more now.
Staffing Stability. Tying FTEs to federal funds becomes riskier.