OMB's 2 CFR 200 Rewrite Is on Hold Until December 11. What It Would Change

On May 29, 2026, the Office of Management and Budget and 41 grantmaking agencies proposed replacing the Uniform Guidance — the rules at 2 CFR Part 200 that govern federal grants and cooperative agreements — with a binding regulation. The proposal runs 108 pages of the Federal Register. OMB asked for it to take effect on October 1, so that a single set of rules would govern every award made in fiscal 2027.

That date came and went. The comment period closed July 13, and the docket on regulations.gov holds 496,606 comments. Then on September 2, the stopgap spending law that funds the government through December 11 was signed, and Section 157 of it says the rule “or a substantially similar rule, shall not be issued or finalized” before then.

So the rule is paused, not withdrawn. The pause expires with the funding on December 11, and whatever Congress passes next decides whether it continues. That leaves about six weeks to understand what the rule would do to an award you hold or are applying for — and which parts of it are already in motion without it.

What the proposal would change

Three provisions do most of the work.

Political review before an award is made. Proposed §200.205(b) requires agency heads to “designate one or more senior appointees to conduct a pre-issuance review of all discretionary awards.” The reviewers apply principles written into the regulation itself. The first is that discretionary awards “must, where applicable, demonstrably advance the President’s policy priorities.” Others bar funding for a list of named activities, give preference “all else being equal” to “institutions with lower indirect cost rates,” and ask research awards to commit to the administration’s Gold Standard Science policies.

The procedure matters as much as the principles. The appointee “must not ministerially ratify or routinely defer to the recommendations of others.” Peer review survives, but only so long as its recommendations “remain advisory.” And the pre-issuance review “may form the basis of a decision not to select an applicant.” A proposal can clear merit review and still be declined at the last step.

Termination for the national interest. The current rules already let an agency end an award that “no longer effectuates the program goals or agency priorities” — the executive order that set this rewrite in motion quotes that language from today’s §200.340(a). Proposed §200.340(a)(2) widens it. An agency or pass-through entity could, “to the extent permitted by law,” terminate whenever it “determines that a termination is in the interest of the Federal agency or pass-through entity, including if a Federal award does not effectuate program goals, Federal agency priorities, or the national interest as they exist at the time of the termination.”

The last clause carries the weight. The test would no longer be whether an award served the agency’s priorities when it was made, but whether it serves them on the day someone decides to end it.

A 90-day stop order. Proposed §200.340(e) would let an agency or pass-through entity “at any time” issue a written order suspending an award in whole or in part. A suspension “must not exceed a period of 90 days unless the parties mutually agree to an extended period,” and during it the recipient must “take reasonable steps to minimize the incurrence of costs.” The preamble names its model: the stop-work order in federal procurement contracts.

Two limits sit on the termination power. It applies to discretionary awards, “but not to Federal awards made under programs where legislation establishes an entitlement to the funds on the part of the recipient, such as block grants, those awarded based on a statutory formula, or disaster recovery grants.” And it gives way where a program’s own statute conflicts. The pre-issuance review is likewise written for discretionary awards.

Beneath all three, the proposal changes what 2 CFR 200 is. Today each agency adopts the Uniform Guidance in its own regulations on its own schedule. The proposal would make it one regulation with one government-wide effective date, so that future OMB amendments reach every agency at once.

What Congress actually paused

Section 157 is short, and its wording shows how narrow it is. Through December 11, 2026, a rule “arising out of the notice of proposed rulemaking titled ‘Regulation for Federal Financial Assistance’… or a substantially similar rule, shall not be issued or finalized.” A second paragraph makes any version issued before the law was enacted ineffective through the same date. The Congressional Research Service reads it the same way. The Computing Research Association, which filed comments opposing the rule, noted in September that the block lasts only as long as the stopgap itself and applies only to OMB.

What Section 157 does not reach is the executive order behind the rule. Executive Order 14332, signed August 7, 2025, told every agency head to “promptly designate a senior appointee” to run a review process that includes “pre-issuance review of discretionary awards to ensure that the awards are consistent with applicable law, agency priorities, and the national interest,” with a senior appointee or designee taking part in the discussion of applications. It also required agencies to report whether their standard terms already permit termination for convenience. The proposed rule would write that into binding, government-wide text. The order has been pushing agencies in that direction for fourteen months.

Agencies are also moving through their own channels. In June the National Science Foundation proposed replacing its Proposal and Award Policies and Procedures Guide with a new “NSF Guidance on Financial Assistance,” with comments due August 24. Physics Today reported on October 6 that NSF’s revisions are being drafted to line up with the OMB proposal. Section 157 does not define “substantially similar.”

The direction shows up in live funding notices too. EPA’s 2026 Diesel Emissions Reduction Act competition, open now, says EPA “revamped DERA requirements to ensure alignment with the Administration’s priorities,” citing updates to 2 CFR §200.204.

Your award will likely be made after December 11

The pause covers rulemaking. It does not cover the award calendar, and the two do not line up. Most competitions open today will be decided in 2027, after the pause has lapsed — and a final rule would govern awards made after its effective date.

Four open records in the OpenGrants database show the spread.

EPA’s 2026 DERA National Program offers up to $12,000,000, with applications due January 22, 2027. It is a direct, competitive award for retrofitting or replacing diesel engines, vehicles and equipment — exactly the kind of discretionary award pre-issuance review is written for. DERA also sends non-competitive money to states and territories through its State Program, which sits on different footing.

The Department of Energy Office of Science’s FY 2027 continuation solicitation runs from $5,000 to $10,000,000 and stays open through September 30, 2027, covering every research area in the Office of Science. Applications arriving across fiscal 2027 will be selected under whatever rules are in force when each award is made.

CDC’s Public Health Crisis Response Cooperative Agreement runs from $50,000 to $5,000,000, with applications due February 11, 2027. Applicants are merit-reviewed onto a roster of “approved but unfunded” organizations, and money is released only once CDC determines a public health emergency exists or is imminent. The decision that matters comes at activation, which may be years after the application.

Alaska’s SFY2028 rural public transportation grant is estimated at $15,045,484 — $11,045,484 in Section 5311 funds and $4,000,000 in Section 5339 bus and facility funds — with an extended deadline of December 18, 2026. Intent to award is scheduled for April 16, 2027 and agreements by June 11, 2027. This is Federal Transit Administration money the state passes through, much of it from the Section 5311 formula program, which sits closer to the formula exception than a competitive award does. But the proposed termination and suspension provisions name pass-through entities alongside federal agencies, so a subrecipient should read the state’s terms as closely as the federal ones.

What to do before December 11

1. Sort your federal money by type. For each award and pending application, note whether it is discretionary or formula/block, and whether it comes directly from a federal agency or through a state or other pass-through entity. Both the pre-issuance review and the new termination power turn on that line.
2. Read the termination clause in every new award and amendment. Executive Order 14332 had agencies inventory whether their standard terms permit termination for convenience. If a new award cites 2 CFR 200.340 or adds a priorities or national-interest clause, that clause decides your exposure, with or without a final rule.
3. Keep costs reconstructible by date. The proposal’s preamble restates that a terminated recipient is generally entitled to “reimbursement for all allowable costs incurred up to the effective date of termination,” and a suspension requires steps to minimize costs after the order arrives. Both are settled with records that tie each cost to a date and an activity.
4. Tie your application to the notice’s stated priorities, in writing. Under the proposal, a reviewer applies “Federal agency priorities” after merit review. The priorities you can see are the ones in the funding notice. Make the connection explicit rather than leaving a reviewer to infer it.
5. Know where your indirect cost rate stands. The proposal lists a preference, all else being equal, for lower indirect cost rates. If yours is high, be ready to explain what it pays for.
6. Watch the December package. Congress has to act by December 11, whether with full-year bills or another stopgap, and whether Section 157 is carried forward is part of that negotiation. Until then OMB cannot finalize the rule.

What is still open

The Federal Register shows no final rule. When one comes, it can differ from the proposal in any of the provisions above, and it has to account for the significant issues raised in a docket of close to half a million comments. The proposal set an effective date of October 1 because that is when fiscal 2027 began, and that date has already passed. A final rule now would land partway through the year it was meant to cover.

What will not change is the calendar. Applications going in this fall will be decided after December 11, under whichever rules hold on the day of the award.

OpenGrants tracks open federal competitions, state pass-through programs and foundation grants in one place. Search open grants by agency, deadline and award size to see what is still open before the next rule lands.