On August 7, 2025, President Donald Trump issued an executive order aimed at overhauling the federal grantmaking process to see that taxpayer dollars are used in alignment with national priorities. This action responds to growing concerns about wasteful spending and ideological bias in federally funded programs.
The executive order’s key objectives include:
- Accountability & Oversight: Agencies must designate senior appointees to oversee discretionary grants and funding announcements, in alignment with agency missions and the national interest.
- Streamlined Review: The grant review process will be simplified to reduce reliance on legal and technical experts, promote plain-language applications, and minimize duplication across agencies.
- Scientific Integrity: Grants for research must demonstrate reproducibility and adhere to “Gold Standard Science” principles, prioritizing rigorous scholarship over institutional prestige.
- Termination Flexibility: All discretionary grants must include provisions allowing termination for convenience if the award no longer supports agency goals or national interests.
The executive order mandates significant updates to the Uniform Guidance, which governs federal grant administration. Some of these include:
- Termination for Convenience: All discretionary grants must now include clauses allowing termination when awards no longer advance agency priorities or the national interest. This includes foreign assistance awards and applies retroactively where feasible.
- Cost Controls: The Office of Management and Budget is directed to revise the Uniform Guidance to limit the use of grant funds for facilities and administrative costs, so more funding reaches core project activities.
- Drawdown Restrictions: Future grant agreements must prohibit automatic drawdowns of general funds for specific projects without agency approval and require detailed justification for each drawdown request.
In addition, the executive order outlined some prohibited uses for discretionary grants. It states, “Discretionary awards shall not be used to fund, promote, encourage, subsidize, or facilitate:
- (A) racial preferences or other forms of racial discrimination by the grant recipient, including activities where race or intentional proxies for race will be used as a selection criterion for employment or program participation;
- (B) denial by the grant recipient of the sex binary in humans or the notion that sex is a chosen or mutable characteristic;
- (C) illegal immigration; or
- (D) any other initiatives that compromise public safety or promote anti-American values.”
Agencies are required to submit reports within 30 days detailing current grant terms and begin revising existing and future awards to comply with the new standards.
This executive order marks a significant shift in federal funding policy, emphasizing fiscal responsibility, scientific rigor, and alignment with the administration’s values. Agencies and grant recipients should prepare for increased scrutiny and revised application procedures.
Our grants management team is monitoring the executive order and can help impacted entities with funding questions and next steps. For further inquiries or assistance, please reach out to a professional at Forvis Mazars.