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Regulation for Federal Financial Assistance, proposed rule
Office of Management and Budget · 2026-05-29
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32198 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
OFFICE OF MANAGEMENT AND U.S. AGENCY FOR GLOBAL MEDIA DEPARTMENT OF EDUCATION
BUDGET
2 CFR Part 1900 2 CFR Parts 3474 and 3485
2 CFR Parts 1, 25, 170, 175, 176, 180, RIN 3112–AA07 RIN 1801–AA30
182, 183, and 200 NUCLEAR REGULATORY EXPORT IMPORT BANK
DEPARTMENT OF HEALTH AND COMMISSION
2 CFR Part 3513
HUMAN SERVICES 2 CFR Parts 2000 and 2001 RIN 3048–AA03
2 CFR Parts 300, 376, and 382 RIN 3150–AL41
EXECUTIVE OFFICE OF THE
RIN 0991–AC35 CORPORATION FOR NATIONAL AND PRESIDENT
DEPARTMENT OF AGRICULTURE COMMUNITY SERVICE
Office of National Drug Control Policy
2 CFR Parts 400, 417, and 421 2 CFR Parts 2200, 2205, and 2245
RIN 3045–AA94 2 CFR Part 3603
RIN 0505–AA20 RIN 3201–AA03
SOCIAL SECURITY ADMINISTRATION
DEPARTMENT OF STATE PEACE CORPS
2 CFR Parts 2300, 2336, and 2339
2 CFR Parts 600 and 601 RIN 0960–AJ11 2 CFR Parts 3700 and 3701
RIN 1400–AG22 RIN 0420–AA37
DEPARTMENT OF HOUSING AND
AGENCY FOR INTERNATIONAL URBAN DEVELOPMENT ELECTION ASSISTANCE COMMISSION
DEVELOPMENT 2 CFR Parts 5800 and 5801
2 CFR Parts 2400, 2424, and 2429
2 CFR Parts 700, 701, 780, and 782 RIN 2501–AE01 RIN 3265–AA00
RIN 0412–AB19 GULF COAST ECOSYSTEM
NATIONAL SCIENCE FOUNDATION
DEPARTMENT OF VETERANS RESTORATION COUNCIL
2 CFR Parts 2500 and 2520
AFFAIRS RIN 3145–AA75 2 CFR Part 5900
2 CFR Parts 801 and 802 RIN 3600–AA05
NATIONAL ARCHIVES AND RECORDS
RIN 2900–AT02 ADMINISTRATION FEDERAL COMMUNICATIONS
DEPARTMENT OF ENERGY COMMISSION
2 CFR Part 2600
2 CFR Parts 901, 902, and 910 RIN 3095–AC31 2 CFR Part 6000
RIN 3060–AM35
RIN 1991–AC21 SMALL BUSINESS ADMINISTRATION
CONSUMER PRODUCT SAFETY
DEPARTMENT OF THE TREASURY 2 CFR Parts 2700 and 2701 COMMISSION
2 CFR Part 1000 RIN 3245–AI70
DEPARTMENT OF JUSTICE 2 CFR Part 6100
RIN 1505–AC92 RIN 3041–AE26
DEPARTMENT OF DEFENSE 2 CFR Parts 2800 and 2867
DELTA REGIONAL AUTHORITY
RIN 1105–AB81
2 CFR Parts 1104, 1120, 1122, 1125,
DEPARTMENT OF LABOR 2 CFR Part 6200
and 1126 RIN 4718–AA00
RIN 0790–AM03 2 CFR Parts 2900 and 2998
APPRAISAL SUBCOMMITTEE OF THE
DEPARTMENT OF TRANSPORTATION RIN 1291–AA53
FEDERAL FINANCIAL INSTITUTIONS
2 CFR Parts 1200 and 1201 DEPARTMENT OF HOMELAND EXAMINATION COUNCIL
SECURITY
RIN 2105–AF44 2 CFR Part 6300
2 CFR Parts 3000, 3001 and 3002 RIN 3139–AA07
DEPARTMENT OF COMMERCE RIN 1601–AB23
2 CFR Parts 1326, 1327, and 1329 MARINE MAMMAL COMMISSION
NATIONAL FOUNDATION ON THE
RIN 0605–AA85 ARTS AND THE HUMANITIES 2 CFR Part 6400
RIN 0415–AA00
DEPARTMENT OF THE INTERIOR Institute of Museum and Library
MILLENNIUM CHALLENGE
2 CFR Parts 1400, 1401, and 1402 Services
CORPORATION
RIN 1090–AB34 2 CFR Parts 3185, 3186, and 3187
RIN 3137–AA31 2 CFR Part 6500
ENVIRONMENTAL PROTECTION RIN 0414–AA00
AGENCY NATIONAL FOUNDATION ON THE
ARTS AND THE HUMANITIES NATIONAL CREDIT UNION
2 CFR Parts 1500, 1532, and 1536 ADMINISTRATION
RIN 2030–AB05 National Endowment for the Arts
2 CFR Part 6600
U.S. INTERNATIONAL DEVELOPMENT 2 CFR Parts 3254, 3255, and 3256
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RIN 3133–AG07
FINANCE CORPORATION RIN 3135–AA36
2 CFR Part 1600 Regulation for Federal Financial
NATIONAL FOUNDATION ON THE Assistance
RIN 3015–AA00 ARTS AND THE HUMANITIES
AGENCY: Office of Federal Financial
NATIONAL AERONAUTICS AND National Endowment for the
SPACE ADMINISTRATION Management, Office of Management and
Humanities Budget; Department of Health And
2 CFR Parts 1800, 1880, and 1882 2 CFR Parts 3369, 3373, and 3374 Human Services; Department of
RIN 2700–AE90 RIN 3136–AA47 Agriculture; Department of State;
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Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules 32199
Agency for International Development; proposes changes to reduce recipient accountability, and oversight for use of
Department of Veterans Affairs; burden. The listed Federal grant-making Federal taxpayer dollars; (2) clarify the
Department of Energy; Department of agencies propose conforming changes to status of OMB’s policies and
Treasury; Department of Defense; their respective adopting regulations, or, requirements set forth in the 2 CFR
Department of Transportation; in the case of some agencies and other regulatory text as an OMB regulation;
Department of Commerce; Department entities, establishing new adopting and (3) reduce recipient burden.
of the Interior; Environmental regulations or policies. The proposed Transparency, Accountability, and
Protection Agency; U.S. International changes reflect the administration’s Oversight. The overarching goal of
Development Finance Corporation; commitment to transparency, OMB’s proposed revisions is to improve
National Aeronautics and Space accountability, and proper oversight for transparency, accountability, and
Administration; U.S. Agency for Global the Federal grantmaking process. The oversight for how Federal taxpayer
Media; Nuclear Regulatory Commission; proposed regulations seek to ensure that dollars are used in the context of
Corporation for National and American tax dollars are ultimately Federal grantmaking.1 It is essential for
Community Service; Social Security used to serve the needs of the American the Federal Government to provide
Administration; Department of Housing public. more oversight over the design and
and Urban Development; National DATES: Comments are due on or before implementation of Federal programs to
Science Foundation; National Archives July 13, 2026. Late comments will be prevent wasteful spending and misuse
and Records Administration; Small considered only to the extent or mismanagement of Federal funds.
Business Administration; Department of practicable. Although Federal spending through
Justice; Department of Labor; grants and other types of Federal
ADDRESSES: Comments on this proposal
Department of Homeland Security; financial assistance has grown
must be submitted electronically before exponentially since the initial
Institute of Museum and Library
the comment closing date to establishment of OMB’s policies in
Services; National Endowment for the
www.regulations.gov. In submitting earlier Circulars and 2 CFR,
Arts; National Endowment for the
comments, please search for recent corresponding policies capable of
Humanities; Department of Education;
submissions by OMB to find docket ensuring transparency, accountability,
Export Import Bank; Executive Office of
OMB–2026–0034, which includes the and oversight for this increased level of
the President, Office of National Drug
full text of the proposed revisions and spending remain deficient in the current
Control Policy; Peace Corps; Election
submit comments there. Please provide regulatory text. As a result, Federal
Assistance Commission; Gulf Coast
clarity as to the section of the regulation financial assistance programs, and the
Ecosystem Restoration Council; Federal
that each comment is referencing by activities performed under Federal
Communications Commission;
beginning each comment with the awards, have not always remained
Consumer Product Safety Commission;
Delta Regional Authority; Appraisal relevant section number in brackets. For properly aligned with core purposes
Subcommittee of the Federal Financial example; if the comment is on 2 CFR authorized by law, nor served the needs
Institutions Examination Council; 200.414, include the following before of the American public as intended.
Marine Mammal Commission; the comment [200.414]. This lack of transparency,
Public comments received by OMB accountability, and proper oversight
Millennium Challenge Corporation;
and Federal agencies will be posted at became increasingly clear between 2021
National Credit Union Administration.
www.regulations.gov and be a matter of and 2024. Federal awards were often
ACTION: Proposed rule.
public record. Accordingly, please do used during those years to promote a
SUMMARY: The Office of Management not include any confidential business ‘‘woke’’ policy agenda that did not
and Budget (OMB) proposes to revise information or personal privacy reflect the values of the vast majority of
the Guidance for Federal Financial information in your comments. the American public.2 For example,
Assistance to improve government-wide FOR FURTHER INFORMATION CONTACT: Federal programs and funding
policies and requirements related to the Andrew Reisig or Joel Savary at the opportunities were designed to advance
management of grants, cooperative OMB Office of Federal Financial unlawful identity-based ‘‘Diversity,
agreements, and other forms of Management via email at Equity, and Inclusion’’ (DEI) policies
assistance. OMB is proposing revisions MBX.OMB.Grants@OMB.eop.gov. and preferences across the country.3
that would improve transparency, SUPPLEMENTARY INFORMATION: These policies were inconsistent with
accountability, and oversight for Federal basic American values and civil rights
awards across the Federal Government. I. Executive Summary
laws, including the equal protection
This includes ensuring that American The Office of Management and Budget principles of the U.S. Constitution.4
tax dollars are not wasted or misused, (OMB) proposes to revise several parts
activities performed under Federal of the OMB Guidance for Federal 1 Executive Order (E.O.) 14332, 90 FR 38929,
awards are consistent with law and Financial Assistance located in title 2 of ‘‘Improving Oversight of Federal Grantmaking’’
policy, and recipients are held the Code of Federal Regulations (CFR), (Aug. 7, 2025); White House Fact Sheet of Aug. 7,
accountable when they fail to meet subtitle A, to improve and clarify 2025, ‘‘President Donald J. Trump Stops Wasteful
Grantmaking;’’ and White House Fact Sheet of Feb.
relevant standards. The revisions also government-wide policies and 18, 2025, ‘‘President Donald J. Trump Requires
aim to ensure that basic American requirements related to the management Transparency for the American People About
principles of equality and equal of Federal financial assistance including Wasteful Spending.’’
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2 E.O. 14332, sec. 1.
opportunity are upheld throughout all grants and cooperative agreements. In 2
3 See, e.g., David Ditch, Mike Gonzalez, Hans von
stages of the award making process and CFR subtitle B, the listed Federal
Spakovsky and Erin Dwinell, ‘‘President Biden’s
that unlawful discrimination is no agencies also propose conforming ‘Equity Action Plans’ Reveal Radical, Divisive
longer permitted. Proposed changes also changes to their respective Agenda.’’ Heritage Foundation Backgrounder No.
include providing further clarification implementing regulations for the OMB 3710, May 25, 2022 (hereinafter ‘‘Ditch I’’).
4 E.O. 14151 of January 20, 2025, ‘‘Ending Radical
on the regulatory status of the OMB policy requirements in subtitle A. As
and Wasteful Government DEI Programs and
requirements and on the process for explained in further detail below, OMB Preferencing;’’ E.O. 14173 of January 21, 2025,
future updates to the government-wide proposes revising 2 CFR for reasons ‘‘Ending Illegal Discrimination and Restoring Merit-
requirements. Finally, OMB also including to: (1) improve transparency, Continued
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32200 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
They were also misaligned in many AIDS Relief (PEPFAR), which was grant programs should not be subsidized
cases with underlying public purposes established to respond to the AIDS crisis with taxpayer dollars. Grantmaking
authorized by law.5 Collectively, these in Africa. Due to wasteful spending, practices resulting in wasteful spending
policies wasted a great amount of PEPFAR became a left-wing foreign aid that became prevalent during the
taxpayer resources and caused great entitlement that attempted to promote previous administration can only be
harm to public trust in government. abortion and gender ideology. stopped through adherence to strong
The White House Fact Sheet of Additionally, an August 2025 report internal controls at Federal agencies and
August 7, 2025, describes examples of from the Heritage Foundation noted enhanced oversight regarding how
the types of wasteful spending that that, according to the U.S. House Federal dollars are spent.
occurred as a result of such policies. For Foreign Affairs Committee, billions of The Federal Government must
example, Federal grants funded dollars in overhead and program provide more oversight and
unlawful DEI practices,6 various anti- charges flow to nongovernmental transparency regarding how Federal
American ideologies in American organizations (NGOs) and contractors in funds are used in grantmaking to avoid
education,7 non-replicable and highly Washington, DC rather than providing the recurrence of similar issues in the
misleading studies,8 labs engaged in direct humanitarian aid; and future. Under the proposal described in
gain-of-function research,9 and AI- insufficient oversight has resulted in this document, Federal agencies must
powered social media censorship significant waste of taxpayer return to designing assistance programs
tools.10 More recently, another White resources.13 and award activities to align with
House Fact Sheet of January 8, 2026 An additional example is provided by essential public purposes authorized by
provided examples of the rampant and a 2024 report from the U.S. Senate law. Effective oversight also includes
pervasive problem of fraud in the Committee on Commerce, Science, and following Executive Branch policies that
United States, including under Transportation regarding the growing eliminate various kinds of wasteful
assistance programs in Minnesota.11 failure of objectivity at the National spending that occurred in previous
Another example of wasteful Science Foundation (NSF) during the years, such as unlawful DEI mandates
spending is provided by a 2023 report previous administration.14 That report and other unnecessary add-on activities
from Office of Inspector General for the found that out of a sample of over three that increase project costs and
Department of Homeland Security thousand grants, more than ten complexity without serving the
(DHS). That report found that recipients percent—totaling over two billion underlying public purpose of the
of Federal awards from the Federal dollars in Federal funding—went to award.16 The proposed reforms are
Emergency Management Agency ‘‘questionable projects that promoted necessary to ensure greater
(FEMA) potentially misused funds to diversity, equity, and inclusion (DEI) accountability for use of public funds,
provide services for illegal tenets or pushed onto science neo- and that every taxpayer dollar the
immigrants.12 Such potential abuse of Marxist perspectives about enduring Federal Government spends either
taxpayer funds highlights the need for class struggle.’’ The report also found improves American lives or advances
proper oversight of taxpayer dollars. that, by 2024, over a quarter of new American interests.17
In another prominent example, prior grants made by NSF (27 percent) Clarification of status of regulatory
to this administration, far-left activists directed funding to DEI initiatives and text. A second objective of this
hijacked the critical work done by the other far-left perspectives. This marked rulemaking is to clarify the status of the
U.S. President’s Emergency Plan for a huge proportional increase over the 2 CFR regulatory text as an OMB
course of only three years from the 0.29 regulation. The proposed revisions align
Based Opportunity;’’ E.O. 14281 of April 23, 2025, percent of new grants made by NSF
‘‘Restoring Equality of Opportunity and
with OMB’s statutory authority to
Meritocracy.’’
with a similar focus in 2021.15 This is provide overall direction and leadership
5 E.O. 14332, sec. 1; see also, e.g., David Ditch, just a small sample of many examples to Federal agencies on financial
‘‘Funding Leftism, Making Power Grabs: The Biden across the Federal Government of management matters by establishing
Administration’s Bureaucratic Radicalism.’’ wasteful spending and other misuse and financial management policies and
Heritage Foundation, Apr. 18, 2024 (hereinafter mismanagement of Federal funds.
‘‘Ditch II’’). requirements. See 31 U.S.C. 503(a)(2).
6 E.O. 14332, sec. 1.
Scarce Federal taxpayer dollars Additional authorities for OMB’s
7 E.O. 14332, sec. 1. should be directed exclusively to proposed revisions are set forth below.
8 E.O. 14303 of May 23, 2025, ‘‘Restoring Gold achieving results for the American Reducing recipient burden. A third
Standard Science.’’ people. Wasteful and divisive activities and final objective of this rulemaking is
9 White House Fact Sheet of Aug. 7, 2025. See unrelated to core purposes of Federal to reduce recipient burden. For
also E.O. 14292 of May 5, 2025, ‘‘Improving the
Safety and Security of Biological Research;’’ and example, rather than needing to focus
13 Max Primorac, PEPFAR: From AIDS Relief to
White House Fact Sheet of May 5, 2025, ‘‘President extensive efforts and resources on DEI
Leftwing Funding Apparatus,’’ Heritage
Donald J. Trump Achieves Improved Safety and
Foundation, Aug. 11, 2025. Available at: https:// mandates or other unnecessary add-on
Security of Biological Research.’’ www.heritage.org/global-politics/report/pepfar- requirements frequently included in
10 White House Fact Sheet of Aug. 7, 2025. See
aids-relief-leftwing-funding-apparatus. See also Tim funding opportunities in previous years,
also E.O. 14149 of Jan. 20, 2025, ‘‘Restoring Meisburger. U.S. Foreign Aid Used to Push
Freedom of Speech and Ending Federal Abortion, Gender Ideology Around the World.
under the proposed version of the
Censorship;’’ and E.O. 14319 of Jul. 23, 2025, Heritage Foundation. Jun. 8, 2023. Available at: regulation recipients will be able to
‘‘Preventing ‘Woke AI’ in the Federal Government.’’ https://www.heritage.org/global-politics/ restore focus on efficient project
11 White House Fact Sheet of Jan. 8, 2026, commentary/us-foreign-aid-used-push-abortion- delivery and actually achieving the
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‘‘President Donald J. Trump Establishes New gender-ideology-around-the-world.
Department of Justice Division for National Fraud 14 U.S. Senate Committee on Commerce, Science, basic public purposes of support
Enforcement.’’ See also White House Fact Sheet of and Transportation, ‘‘D.E.I. Diversion. Extremism. authorized in law.
Jan. 2, 2026, ‘‘Here’s What the Trump Ideology. How the Biden-Harris NSF Politicized OMB also proposes a number of
Administration Is Doing to Crush Minnesota’s Science.’’ (2024). Available at https:// additional revisions throughout
Fraud Epidemic;’’ DOJ Press Release of Nov. 24, www.commerce.senate.gov/services/files/
2025, ‘‘Feeding Our Future Defendant Sentenced to 4BD2D522-2092-4246-91A5-58EEF99750BC#.
chapters I and II of subtitle A of 2 CFR.
10 Years in Prison.’’ 15 Subsequent to this report, NSF took action
12 DHS Office of Inspector General, ‘‘FEMA 16 See, e.g., E.O. 14332; and White House Fact
during this Administration to review its award
Should Increase Oversight to Prevent Misuse of portfolio and, to the extent permitted by law, ensure Sheets of Aug. 7, 2025 and Feb. 18, 2025.
Humanitarian Relief Funds,’’ DHS OIG–23–20. alignment with Federal agency priorities. 17 E.O. 14332, sec. 1.
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Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules 32201
OMB summarizes the proposed changes consolidated, streamlined, and under now-superseded Circulars,22 and
in this preamble. In proposing changes, superseded requirements from several the initial establishment of the Uniform
OMB aimed to maintain the existing earlier OMB Circulars and guidance Guidance in 2013 based on policies
structure of the 2 CFR guidance documents related to grants contained in the earlier Circulars, the
consistent with earlier iterations, management and implementation of the landscape of Federal financial
including, for example, the structure of Single Audit Act. At the time, OMB assistance funding has changed
parts, subparts, and section numbering. explained that the guidance was also markedly—including massive growth in
Plain Language Summary: A plain intended to improve clarity and the scale and volume of assistance
language summary of this rule may be accessibility of the requirements across provided by the Federal Government,
found at https://www.regulations.gov/. the Federal Government. increasing diversification in the
Federal award-making agencies purposes and types of assistance, and
II. Background and Regulatory History implemented the Uniform Guidance increasing responsibilities for executive
The Office of Management and Budget through an interim final rule, which agency administration of discretionary
(OMB) has assisted every modern became effective on December 26, 2014. programs. A wide array of new Federal
President in ensuring that the 79 FR 75867 (Dec. 19, 2014) (2014 financial assistance programs and
President’s priorities, consistent with Federal Agency Interim Final Rule). statutory responsibilities for executive
applicable law, are appropriately Following the 2014 Federal Agency agencies have been established by
accounted for in government-wide grant Interim Final Rule, most agencies did Congress, but the oversight and
management policies and agency grant- not reissue implementing regulations stewardship of Federal financial
making decisions. In service of that goal, each time that the government-wide assistance by executive branch agencies
in 1958, the Bureau of the Budget, policies and requirements contained in has not always kept pace with or
OMB’s predecessor, first issued Circular 2 CFR subtitle A were updated by OMB accounted for these changes. Revisions
A–21, ‘‘Cost Principles for Educational following public notice and comment to OMB’s policies in 2 CFR part 200 are
Institutions.’’ In 1968, the Bureau of the rulemaking procedures.20 Instead, now warranted to improve
Budget first issued Circular A–87, ‘‘Cost Federal agencies only occasionally transparency, accountability, and
Principles for State, Local, and Indian issued or reissued implementing efficiency of Federal financial assistance
Tribal Governments.’’ In 1976, OMB regulations. This generally occurred programs.
first issued both Circular A–110, when specific changes were needed in
the agency regulations. Because OMB III. Statutory Authority for OMB
‘‘Uniform Administrative Requirements Regulation for Federal Financial
for Grants and Other Agreements with has exclusive statutory authority under
31 U.S.C. 503(a)(2) to set government- Assistance
Institutions of Higher Education,
Hospitals and Other Non-Profit wide financial management policies and The Deputy Director for Management
Organizations;’’ 18 and Circular A–122, requirements, the public comment of OMB is authorized under 31 U.S.C.
‘‘Cost Principles for Non-Profit period for the government-wide policies 503 to, among other things, provide
Organizations.’’ All of these Circulars and requirements has been provided by ‘‘overall direction and leadership to the
were repeatedly revised in the decades OMB, not agencies.21 executive branch on financial
following their initial issuance. Other OMB periodically reviews the management matters by establishing
now-superseded OMB Circulars Uniform Guidance in accordance with 2 financial management policies and
providing requirements related to grants CFR 200.109. Following establishment requirements.’’ 31 U.S.C. 503(a)(2). The
administration included Circular A–89, of the Uniform Guidance in 2013, OMB Director of OMB is authorized under 31
‘‘Federal Domestic Assistance Program made further revisions to the regulatory U.S.C. 6307 to ‘‘issue supplementary
Information;’’ and Circular A–133, text in 2020 (85 FR 49506 (Aug. 13, interpretative guidelines to promote
‘‘Audits of States, Local Governments, 2020)) and 2024 (89 FR 30046 (Apr. 22, consistent and efficient use of . . . grant
and Non-Profit Organizations.’’ 19 2024). The 2020 revisions addressed agreements . . . and cooperative
Between 2012 and 2013, OMB worked topics including program planning and agreements.’’
with Federal agencies to revise and design, performance measurement to OMB also relies on authorities
improve program goals and outcomes, including the Single Audit Act
streamline existing OMB guidance and
sharing lessons learned, and adopting Amendments of 1996 (Pub. L. 104–156,
Circulars related to grants
promising practices. OMB again revised as amended, codified at 31 U.S.C. 7501–
administration to develop the ‘‘Uniform
the regulatory text in 2024. The 7507); the Federal Funding
Administrative Requirements, Cost
objectives of the 2024 update included Accountability and Transparency Act of
Principles, and Audit Requirements for
incorporating statutory requirements 2006 (FFATA or the Transparency Act)
Federal Awards’’ (Uniform Guidance)
and certain policy priorities of the (Pub. L. 109–282), as amended; the
located in part 200 of 2 CFR. 79 FR
previous administration, reducing Digital Accountability and
78589 (Dec. 26, 2013) (2013 Final
agency and recipient burden, clarifying Transparency Act of 2014 (DATA Act of
Guidance). See also 77 FR 11778 (Feb.
sections that recipients or agencies have 2014) (Pub. L. 113–101), as amended;
28, 2012) (2012 Advance Notice of
interpreted in different ways, rewriting the Federal Program Information Act
Proposed Guidance); 78 FR 7282 (Feb. 1, (Pub. L. 95–220 and Public Law 98–169,
2013) (2013 Proposed Guidance). This certain sections of the regulatory text in
plainer language, improving flow, and as amended, codified at 31 U.S.C. 6101–
effort was designed to assist programs in 6106); the Federal Grant and
delivering better outcomes on behalf of resolving inconsistent use of terms.
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the American people while also Since the inception of OMB financial
22 OMB’s 2012 Advance Notice of Proposed
reducing administrative burden and the management policies and requirements
Guidance explained that, prior to establishment of
risk of fraud, waste, and abuse. The 20 See 2 CFR 1.230.
2 CFR part 200, government-wide audit
Uniform Guidance, published in 2013, requirements were contained in OMB Circulars A–
21 See, e.g., OMB Memorandum M–24–11,
133 and A–50; cost principles were contained in
Section I (‘‘Implementation of Title 2 of the CFR’’) OMB Circulars A–21, A–87, and A–122; and
18 See, e.g., OMB Circular A–110 (1993). The
(Apr. 4, 2024); and Council on Federal Financial administrative requirements were contained in the
guidance in Circular A–110 was relocated to 2 CFR Assistance (COFFA) Memoranda for the Federal government-wide Common Rule implementing
part 215 in 2004. See 69 FR 26281 (May 11, 2004). Financial Assistance Community dated January 15, Circular A–102, Circular A–110, and Circular A–89.
19 79 FR 78589 (Dec. 26, 2013). 2025 and August 15, 2024. See 77 FR 11778 (Feb. 28, 2012).
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32202 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
Cooperative Agreement Act of 1977 oversight in the government-wide Among various other policy
(Pub. L. 95–224, as amended, codified at system of grants administration, requirements, Federal programs were
31 U.S.C. 6301–6309); the Office of including by ensuring that Federal frequently designed between 2021 and
Federal Procurement Policy Act award programs are properly aligned 2024 to include preferences and
(codified at 41 U.S.C. 1101–1131); the with law and policy and that Federal selection criteria aimed at advancing
Budget and Accounting Procedures Act agencies act as responsible stewards of identity-based DEI policies.27 This
of 1950, as amended (codified at 31 taxpayer dollars. included using a variety of labels, such
U.S.C. 1101–1126); the Chief Financial Recent years have provided evidence as promoting DEI, or using other
Officers Act of 1990 (codified at 31 of the need for meaningful reform in intentional proxies for race, sex, or
U.S.C. 503–504); the Trafficking Victims Federal grants administration. Instead of sexual identity, to give priority to
Protection Act of 2000 (TVPA), as aiming to broadly serve the needs of all certain favored identity characteristics
amended (codified at 22 U.S.C. 7101– Americans, in 2021 Federal agencies and groups at the expense of others in
7115); and Executive Order 11541, became increasingly focused on using the distribution of Federal awards and
‘‘Prescribing the Duties of the Office of their award programs to serve a ‘‘woke’’ associated benefits.28 The concerted
Management and Budget and the policy agenda that deliberately favored effort to impose unlawful DEI policies
Domestic Policy Council in the certain identity groups over others. In on Federal award programs began on the
Executive Office of the President.’’ seeking to advance this agenda, very first day of the previous
programs were often designed to administration through issuance of
IV. OMB Objectives for 2026 Proposed include a long list of ideological terms Executive Order 13985.29 That order
Revisions and conditions with little connection to instructed Federal agencies to set aside
OMB’s objectives for the current the core purpose of public support.24 the decision-making processes used in
proposed revisions to several parts of These burdensome conditions were previous years—which generally aimed
subtitle A of 2 CFR include: (1) consistently imposed through funding to ensure that all Americans were
improving transparency, accountability, opportunities and award agreements treated equally—and to instead focus on
and oversight for use of Federal funds; regardless of the objective of the remaking the system of grants
(2) clarifying the status of the 2 CFR assistance program. This approach administration with divisive identity-
regulatory text as an OMB regulation; contributed to long delays in program based DEI policies imposed
and (3) reducing recipient burden. The implementation as Federal agencies and throughout.30 Following issuance of
proposed revisions generally support recipients focused their efforts and Executive Order 13985 in January 2021,
one or more of these three objectives. taxpayer resources on divisive policy Federal agencies began attaching these
The following is a high-level overview requirements that were often unrelated policies to all aspects of their award
of the proposed rule’s three primary to or misaligned with core purposes of programs, including program design,
objectives, which is followed by a Federal grant programs. Various award selection, and award conditions
section-by-section discussion of the commenters have remarked on how this imposed on recipients. This continued
proposed changes. approach resulted in waste, inefficiency, for the duration of the previous
long delays in project delivery, and administration.
A. Objective 1: Improved Transparency, reduced program effectiveness across a Based on these efforts, Federal
Accountability, and Oversight range of activities receiving Federal funding was used between 2021 and
OMB’s first objective for the proposed support.25 In one notorious example, 2024 to advance unlawful DEI policies
revisions is to improve transparency, under a $42.5 billion broadband internet and preferences across the country.31
accountability, and oversight for how access program, the previous These and other burdensome policies
Federal funds, including taxpayer administration failed to connect a single and requirements imposed through
dollars, are used in the context of person to the internet over the course of Federal award programs diverted
Federal grantmaking.23 three years—instead focusing efforts and substantial amounts of taxpayer funding
attention on imposing a long list of away from traditional public purposes
A.1. Background burdensome policy requirements.26 recognized in law—such as
For too long, the Federal Government transportation, infrastructure, scientific
has paid insufficient attention to 24 See, e.g., Ditch II (including summary of the
research, public health, and other
providing proper oversight for Federal ‘‘ideological terms and conditions bundled into’’
funding opportunities for infrastructure grants by
essential public goods that serve all
financial assistance programs. the previous administration.). Americans—to instead support favored
Deficiencies currently exist throughout 25 See, e.g., Ezra Klein, ‘‘The Problem with identity groups and left-wing activists.32
the lifecycle of grants—from program Everything-Bagel Liberalism,’’ The New York
design, to award selection, to project Times, April 2, 2023 (describing the tendency of the 27 See E.O. 14151 of Jan. 20, 2025, ‘‘Ending
previous administration to structure Federal award Radical and Wasteful Government DEI Programs
delivery and oversight—that impact the programs to address many unrelated policy goals at and Preferencing;’’ see also Ditch I; Ditch II.
ability of the Federal Government to once, leading to a dramatic increase in the cost and 28 See Lisa Friedman, ‘‘White House Takes Aim
prevent wasteful spending and complexity of projects, long delays in project
at Environmental Racism, But Won’t Mention
efficiently implement assistance delivery, and poor outcomes for American
Race,’’ The New York Times, Feb. 15, 2022
taxpayers); Ditch II (explaining how the prior
programs in a manner consistent with administration structured award programs to
(explaining how the previous administration used
law and the needs of the American various intentional proxies for race to continue
simultaneously include a wide array of ‘‘novel and
directing Federal grants and associated benefits to
public. If finalized, OMB’s proposed contentious’’ policy requirements, which diverted
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preferred racial-identity groups); see also Ditch I;
revisions in 2 CFR will improve focus from core public purposes authorized in law
Ditch II.
and caused ‘‘tremendous amounts of waste and
transparency, accountability, and inefficiency’’).
29 E.O. 14151, sec. 1 (Discussing E.O. 13985); E.O.
26 ‘‘Fact Sheet: Ending Biden’s Broadband 13985 of Jan. 20, 2021, ‘‘Advancing Racial Equity
23 See E.O. 14332 of Aug. 7, 2025, ‘‘Improving Burdens,’’ National Telecommunications and and Support for Underserved Communities
Oversight of Federal Grantmaking;’’ White House Information Administration (NTIA), June 6, 2025; Through the Federal Government,’’ revoked by E.O.
Fact Sheet of Aug. 7, 2025, ‘‘President Donald J. John Thune, ‘‘Broadband Blunders Leave 14148 of Jan. 20, 2025.
30 E.O. 13985.
Trump Stops Wasteful Grantmaking;’’ and White Americans Disconnected,’’ Prairie Pioneer, Oct. 2,
31 See, e.g., E.O. 14151, sec. 1.
House Fact Sheet of Feb. 18, 2025, ‘‘President 2024; Donald Kimball, ‘‘The $42 billion internet
Donald J. Trump Requires Transparency for the program that has connected 0 people,’’ Washington 32 See, e.g., U.S. Senate Committee on Commerce,
American People About Wasteful Spending.’’ Policy Center, Sept. 18, 2024. Science, and Transportation, ‘‘D.E.I. Diversion.
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Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules 32203
As a result, Federal award programs that requirements that had extended through processes for grants management must
once had broad public support became virtually all aspects of the Federal be consistent with law and designed to
tied to a divisive policy agenda that Government in the prior serve the public good of all Americans.
unlawfully discriminated against many administration.35 In the grantmaking OMB’s 2 CFR regulations are a key
of the Americans those programs were context, the President’s Executive orders instrument for improving the standards,
intended to serve. These policies were released Federal programs from the processes, and requirements that apply
inconsistent with basic American values divisive DEI mandates and other to all Federal grant programs. They are
and civil rights laws, including the burdensome policy requirements also an important tool for making
equal protection principles of the U.S. imposed in previous years. Free of these needed reforms to the organizational
Constitution.33 They were also constraints, Federal programs were able culture within Federal grantmaking
misaligned with core purposes of to restore focus on efficiently supporting agencies. These agencies are entrusted
relevant assistance programs.34 All core program purposes and public goods to make discretionary decisions
together, these policies wasted a large that serve all Americans, including regarding the use of many billions of
amount of American taxpayer resources ensuring that scarce public resources are dollars of precious taxpayer resources,
and significantly undermined public best used in support of the essential and must remain accountable to the
trust in government across the country. public goods at which they aim. American people when doing so.43
In January 2025, President Trump Among other things, the President’s Consistent with policies in recent
announced the end of the Executive orders announced that the executive orders, taxpayer dollars must
discriminatory DEI policies and Federal Government would renew its be used to support essential public
commitment to serving every American purposes authorized by law—not
Extremism. Ideology. How the Biden-Harris NSF with equal dignity and respect; 36 restore wasted to promote divisive doctrines of
Politicized Science,’’ (2024) (finding an increase of its policy of prohibiting, rather than the far left.44
more than 9,000 percent between 2021 and 2024 of OMB and Federal agencies now
new NSF grants focused on funding and promoting
mandating, illegal discrimination; 37 and
DEI initiatives); Ditch II (explaining how the make necessary changes to ensure that propose to address the problems
previous administration tied nearly every major the grant review process is no longer summarized above as they impact
infrastructure program to DEI mandates and other used to undermine the interests of Federal grantmaking. This includes
add-on policy requirements unrelated to, and often removal of any remaining pieces of the
conflicting with, the core objective of delivering
American taxpayers.38 A subsequent
needed infrastructure improvements across the Executive order in August 2025 old discriminatory policies that agencies
country in a timely and cost-efficient manner); emphasized that Federal agencies must may still apply to decision-making
Ditch I (explaining how ‘‘equity plans’’ issued by ensure that all Americans are treated processes in the area of grants
Federal agencies including the Departments of management. It also includes ending
Commerce, Defense, Education, Energy, Justice, and
equally and make merit-based decisions
State, and the National Science Foundation, called related to the ability of an applicant or government sponsorship of gender
for ‘‘group-based preferential treatment in grant and recipient to produce actual results for ideology and other radical doctrines the
research programs and foreign aid’’); U.S. DOT the American taxpayer.39 On July 29, previous administration sought to
Press Release of Mar. 10, 2025, ‘‘U.S. Transportation impose across the country through
Secretary Sean P. Duffy Rescinds Memos Issued By
2025, the U.S. Department of Justice
Biden Administration That Injected Social Justice, (DOJ) also issued new government-wide Federal funding programs. By renewing
Radical Environmental Agenda Into Infrastructure guidance intended to ensure that the Federal Government’s commitment
Funding Decisions’’ (summarizing DOT decision to recipients of Federal funding do not to basic American values, and proposing
rescind policies from the last administration other needed reforms to responsibly
attempting ‘‘to push a radical social and
engage in unlawful discrimination.40 On
environmental agenda’’ with ‘‘no basis in statute’’ December 2, 2025, DOJ’s Office of Legal manage and safeguard taxpayer funds
on Federal infrastructure programs); Judge Glock, Counsel (OLC) also released an opinion used in grantmaking, OMB seeks to
‘‘Biden’s Progressive Infrastructure Boondoggle,’’ finding that certain race-based grant prevent the types of unlawful
City Journal, Summer 2025 (explaining that, in discrimination, wasteful spending, and
working to implement the Infrastructure Investment
programs administered by the
and Jobs Act, many in the previous administration Department of Education violate the other significant problems that arose in
were not ‘‘especially interested in traditional Fifth Amendment’s equal-protection recent years from recurring in the
infrastructure’’ or advancing ‘‘core transportation component.41 That opinion explained future. As explained in Executive Order
goals—[instead] elevating a host of progressive 14332, the Federal Government holds
priorities in their place’’); James B. Meigs, ‘‘The Big
that any ‘‘allocation of benefits and
Squeeze: How Biden’s Environmental Justice burdens based on a person’s race is tax revenue in trust for the American
Agenda Hurts the Economy and the Environment,’’ anathema to the U.S. Constitution.’’ 42 people, and Federal agencies should
Manhattan Institute, Sep. 7, 2023 (explaining how This rulemaking proposes to treat it accordingly.
‘‘environmental justice’’ (EJ) policies diverted
‘‘spending and administrative resources away from
institutionalize needed reforms in the A.2. Improved Transparency
straightforward environmental goals;’’ made Federal grantmaking process to address
‘‘government programs less focused and less the unlawful discrimination and other Changes are needed to ensure
effective across the board;’’ and were ‘‘particularly serious problems that occurred during improved transparency for how Federal
burdensome for environmental and infrastructure
the previous administration. The basic funds are used. American taxpayers
projects,’’ adding ‘‘layers of bureaucracy and red have a right to know the projects that
tape to existing programs’’ and making individual values embedded in the Federal
projects ‘‘more time-consuming’’ and ‘‘more Government’s decision-making their tax dollars are supporting and the
expensive’’ to deliver); James B. Meigs, ‘‘Biden’s entities to which those dollars are
‘Justice40’ Is Bad Environmental Policy,’’ National 35 See, e.g., E.O. 14151, sec. 1. flowing. They should also feel confident
Review, Nov. 9, 2023 (describing EJ policies as 36 Id. that recipients and subrecipients of
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diverting ‘‘spending and administrative resources
from straightforward environmental goals, such as
37 E.O. 14281, sec. 1. Federal awards are engaged in activities
reducing pollution,’’ and redirecting ‘‘them toward
38 E.O. 14151. consistent with the basic public
vague social goals,’’ such as ‘‘satisfy[ing] 39 E.O. 14332; White House Fact Sheet of Aug. 7,
purposes of support authorized by law,
community activists’ demands.’’). 2025. that do not unlawfully discriminate
33 E.O. 14151; E.O. 14173 of January 21, 2025, 40 DOJ Memorandum of July 29, 2025, ‘‘Guidance
for Recipients of Federal Funding Regarding
against American citizens, that do not
‘‘Ending Illegal Discrimination and Restoring Merit-
Based Opportunity;’’ E.O. 14281 of April 23, 2025, Unlawful Discrimination.’’ harm the interests or reputation of the
‘‘Restoring Equality of Opportunity and 41 Constitutionality of Race-Based Dep’t of Educ.
Meritocracy.’’ Programs, 2025 WL 4055305 (Dec. 2, 2025). 43 E.O. 14151, sec. 1; E.O. 14332, sec. 1.
34 E.O. 14332, sec. 1; see also Ditch II. 42 Slip Op. 2. 44 Id.
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32204 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
Federal Government, and that do not selecting recipients to receive awards.48 conditions in Federal awards. In
threaten the national or economic Improved oversight refers both to § 200.211, OMB proposes to clarify
security of the United States. For oversight of decision-making processes information that must be included in
example, Federal grant funds should not within Federal agencies and oversight of Federal awards. In §§ 200.218, 200.219,
be used to support recipients and recipients using Federal award funding. 200.220, and 200.300, OMB proposes
subrecipients that work in partnership various changes to ensure that award
A.5. Examples of Proposed Changes
with our foreign adversaries. Improved funds are not used for unlawful
Related to First Objective
transparency will shine a light on the discrimination or other purposes
full scope of Federal agency activities OMB proposes many changes inconsistent with law and Executive
and the network of recipients and throughout this document related to Branch policy.
subrecipients of Federal awards that the improving transparency, accountability, In § 200.305, proposed changes seek
American people are trusting to and oversight for Federal grants. For to ensure that both Federal agencies and
accomplish public purposes of support example, OMB proposes updated pass-through entities exercise
on their behalf. language related to conflicts of interest appropriate due diligence before issuing
A 2023 report from the Government (§ 200.112) and mandatory disclosures payments of Federal funds, including
Accountability Office (GAO) also (§ 200.113). In § 200.202 related to requiring a justification for payment
emphasized the benefits of greater program planning and design, OMB requests. Proposed revisions also
transparency in Federal grants proposes a variety of changes seeking to address use of Treasury’s ‘‘Do Not Pay’’
management.45 The report explained ensure that programs align with law and system before issuing payments.
that ‘‘greater transparency of how the Executive Branch policy. In §§ 200.329 through 200.332, OMB
Federal Government spends its funds In §§ 200.201 and 200.333, and proposes changes related to further
offers many potential benefits,’’ which throughout part 200, OMB proposes to ensuring that pass-through entities
may include ‘‘enabling data-driven eliminate the use of fixed amount follow through on their statutorily-
decisions about how to use government awards and subawards, which can limit required responsibility to report
resources, opportunities for improving transparency and hinder effective subawards on SAM.gov. In addition to
the efficiency and effectiveness of oversight. For example, under fixed ensuring that required reporting occurs,
Federal spending, and improving amount awards there is no expected the proposed changes seek to ensure
government’s accountability to the routine monitoring of actual costs that Federal dollars are tracked as
public.’’ OMB agrees that certain incurred by the recipient or subawards in circumstances in which
reforms are needed to provide greater subrecipient, and no financial reporting recipients transfer funds to affiliates,
transparency and accountability for use is required.49 This proposed change subsidiaries, or other related
of public funds, and greater oversight to further ensures that Federal agencies organizations. Proposed changes also
ensure that every taxpayer dollar the exercise an appropriate level of emphasize the need for Federal agencies
Federal Government spends improves oversight on how tax dollars are spent to ensure that their recipients comply
Americans’ lives or advances American under all types of awards. This will help with subrecipient reporting
interests.46 to ensure that Federal dollars are not requirements on SAM.gov. The 2023
wasted on activities that may not fully GAO report referenced above also
A.3. Improved Accountability support the achievement of program identified ‘‘challenges with the
Proposed revisions related to outcomes. The American people deserve completeness and accuracy of subaward
improved accountability aim to ensure to know where all Federal tax dollars data displayed on USAspending.gov.’’
that recipients are held properly are flowing. OMB is proposing several revisions in 2
accountable for how Federal award In §§ 200.204 through 200.206 related CFR to ensure that pass-through entities
funds are used. This includes ensuring to funding opportunities, selection of meet this reporting obligation and that
that recipients only use Federal award recipients, and reviewing risk of Federal agencies exercise appropriate
funds for authorized public purposes, applicants, OMB proposes a variety of monitoring and oversight over the
and comply with requirements related changes designed to ensure and responsibilities of the recipients they
to reporting, nondiscrimination, and emphasize the need for merit-based decide to partner with under their
other topics. selection of recipients for discretionary programs.
awards.50 Other proposed changes seek In § 200.340, OMB proposes to further
A.4. Improved Oversight to align the regulatory text with clarify the existing regulatory text
The proposed revisions related to requirements in Executive Order 14332 related to award termination and further
improved oversight aim to ensure that regarding oversight in grantmaking. In ensure that Federal agencies provide
every discretionary award program is § 200.206, some of the proposed changes clear notice to all recipients of the
designed by Federal agencies to seek to ensure that recipients with a Federal Government’s ability to
effectively achieve its underlying history of questionable practices or poor terminate discretionary awards for
statutory purpose, and to align, where financial management are not rewarded discretionary reasons in a manner
applicable, with administration policies with scarce taxpayer resources. consistent with law.51 This proposed
and priorities set by the President.47 In § 200.208, OMB proposes to update clarification is similar to the existing
This includes treating every American the standards for including specific authority at § 200.340(a)(4) to terminate
with equal dignity and respect, applying awards found to be inconsistent with
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the principle of merit-based opportunity 48 See, e.g., E.O. 14151; E.O. 14173 of January 21,
program goals or agency priorities. It
throughout the grant lifecycle, and 2025, ‘‘Ending Illegal Discrimination and Restoring
Merit-Based Opportunity;’’ and E.O. 14281 of April would also be similar to the long-
avoiding unlawful discrimination when 23, 2025, ‘‘Restoring Equality of Opportunity and standing authority to terminate Federal
Meritocracy.’’ contracts for convenience at 48 CFR
45 Jeff Arkin, ‘‘Grants Management, Observations 49 See 2 CFR 200.201(b)(1) (existing version).
49.502 and 52.249–2. If finalized, this
on Challenges with Access, Use, and Oversight,’’ 50 See, e.g., E.O. 14173 of January 21, 2025,
United States Government Accountability Office, revision will further ensure that Federal
‘‘Ending Illegal Discrimination and Restoring Merit-
GAO–23–106797, May 2, 2023. Based Opportunity;’’ and E.O. 14281 of April 23, agencies retain ongoing programmatic
46 E.O. 14332, sec. 1.
2025, ‘‘Restoring Equality of Opportunity and
47 E.O. 14332, sec. 4(b)(i). Meritocracy.’’ 51 E.O. 14332, sec. 5 and 6.
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Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules 32205
discretion after an award is made, in proposing these changes.52 In the The existing structure of 2 CFR—
consistent with law, to terminate a future, the public will continue to have including its classification as
discretionary award that is not effective a full and meaningful opportunity to guidance—has tended to result in
at achieving program goals or Federal comment during OMB’s N&C questions and uncertainty in the Federal
agency priorities, or that an agency rulemakings, and agencies will continue grants community regarding the process
otherwise determines is no longer in the providing input to OMB during for agency implementation of OMB
Federal Government’s interest. In the interagency review periods and amendments of the government-wide
same section, OMB also proposes implementing the requirements. As requirements in the regulatory text of
similar changes related to award discussed below, this proposal is subtitle A.55 The existing version of 2
suspension. generally consistent with the way that CFR 200.110(a) already provides that
In addition, OMB proposes additional most agencies have implemented OMB part 200’s requirements become
changes in subpart E (cost principles at amendments of the 2 CFR regulatory effective for the ‘‘administration of
§§ 200.400 through 200.476) related to text since 2013. Federal awards by Federal agencies’’
improving transparency, accountability, This proposal maintains the familiar either ‘‘once implemented by Federal
and oversight. For example, OMB structure of 2 CFR, but will increase agencies [under the process described at
proposes various changes to further predictability, transparency, and 200.106 (existing version)] or when any
distinguish between allowable and uniformity regarding how OMB future [OMB] amendment to . . . part
unallowable costs. amendments are implemented following [200] becomes final.’’ 2 CFR 200.110(a)
B. Objective 2: Clarification of future N&C rulemakings. Consistent (existing version) (emphasis added). As
Regulatory Structure with OMB’s government-wide explained below, OMB proposes to
authorities, the proposal will allow for retain the quoted regulatory text without
OMB’s second objective for the change, but further clarify its meaning
current proposed revisions is to clarify timely amendments of administrative
requirements, cost principles, and audit to address recurring questions regarding
the status of OMB’s government-wide the effect of OMB amendments.
financial management policies and requirements for grants and other
Federal awards across the Federal After the initial agency adoption of
requirements contained in 2 CFR part 200 in 2014, secondary or follow-
subtitle A, as an OMB regulation. In Government.
on rulemakings by Federal agencies to
support of this objective, OMB and the B.1. Current Regulatory Structure implement OMB amendments of part
grantmaking agencies joining this 200 or other parts have generally either
rulemaking collectively propose In 2013, OMB combined previously
not occurred at all 56 or not been
revisions in 2 CFR to clarify the separate OMB circulars and guidance
initiated by agencies in a timely
regulatory status of OMB’s government- documents into one centralized
manner. The sporadic secondary
wide policies and requirements. This guidance document published in 2 CFR
rulemakings that have occurred
change is intended to establish a subtitle A. 2 CFR part 200 is commonly
following 2014 have generally only been
standardized framework across all referred to as OMB’s ‘‘Uniform
initiated in circumstances in which an
Federal grantmaking agencies—now Guidance’’ or ‘‘Uniform Grants
agency had something specific to add or
including those that did not join the Guidance.’’ Following establishment of
modify in its own adopting regulations.
2014 Federal Agency Interim Final the guidance by OMB in 2013, most
In most cases, consistent with 2 CFR
Rule—and to promote predictability, Federal grantmaking agencies initially
200.110(a) (existing version), agencies
transparency, and consistency across adopted the guidance in 2014 through have simply implemented OMB
the Federal Government. This proposal implementing regulations in 2 CFR amendments of the 2 CFR regulatory
would modernize and streamline subtitle B.53 The guidance currently text based on the text of their existing
Federal grants management consistent provides that ‘‘[p]ublication of the OMB adopting regulations, and through the
with OMB’s statutory authority to guidance in the CFR does not change its terms and conditions of Federal awards
enhance financial management across nature—it is guidance, not issued following the government-wide
the Executive Branch. regulation.’’ 54 effective date of the OMB
The current framework in which each amendments.57
agency issues a brief regulation to adopt 52 All, or nearly all, grantmaking agencies in the
There are many practical reasons why
OMB’s requirements will generally be Executive Branch have joined this proposed
rulemaking and plan to actively adopt the specific
agencies have not generally completed
preserved through this interagency policy changes in tandem with OMB through the secondary rulemakings to readopt OMB
rulemaking, but OMB proposes to make joint interagency final rule. Thus, the proposed amendments following 2014. Beginning
minor adjustments in the regulatory text clarifications in this document regarding the dozens of secondary agency N&C
to clarify that OMB’s requirements in process that OMB will follow for 2 CFR rulemakings only after OMB has already
amendments will primarily affect future OMB
subtitle A carry regulatory effect in their amendments of the government-wide requirements completed a year-long government-wide
own right. Agencies will participate in in which other agencies are not directly N&C rulemaking process—including
this one-time joint interagency participating. Although OMB and agencies are extensive interagency coordination
rulemaking to implement the clarified currently undertaking a joint interagency before the formal rulemaking process
rulemaking process through this document, it
regulatory structure and amend their would be inefficient to repeat this process of even begins—would generally be
adopting regulations accordingly. assembling every grantmaking agency in the Federal
Thereafter—in rulemakings following Government to directly join all future OMB 55 See, e.g., OMB Memorandum M–24–11,
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the current one—when OMB amends rulemakings. As discussed in this document, OMB Section I (‘‘Implementation of Title 2 of the CFR’’)
is authorized by law to set government-wide (Apr. 4, 2024); and COFFA Memoranda for the
the regulatory text of 2 CFR through a policies and requirements for grants management. Federal Financial Assistance Community dated
government-wide notice-and-comment Moreover, as also discussed in this document, the January 15, 2025 and August 15, 2024.
(N&C) rulemaking, those changes will proposed process for 2 CFR amendments is very 56 Following initial agency adoption,
apply government-wide on the effective similar to how the existing process for such implementing revisions on the effective date
amendments has already worked for the last provided in OMB’s final rulemaking is consistent
date of OMB’s final rule. This decade. with the information provided to the public in 2
distinction is less relevant for the 53 78 FR 78590; (Dec. 26, 2013); 79 FR 75871 (Dec. CFR 200.110(a) (existing version) regarding the
present rulemaking because relevant 26, 2014). process for implementing future amendments.
grantmaking agencies are joining OMB 54 2 CFR 1.105. 57 See 2 CFR 200.105(b) (existing version).
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32206 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
redundant, create long administrative b. Similar to existing frameworks. The government-wide implementation of the
delays, constitute a major drain on proposed clarification in this document OMB requirements.
agency resources, and frustrate the is similar to the already existing process Consistent with the approach
objective of government-wide for agency implementation of OMB described in the preamble for part 180
uniformity for OMB policy changes. For amendments of the regulatory text in and the existing regulatory text at
example—as with the Federal part 200. Information on the existing § 200.110(a), this document proposes to
Acquisition Regulation (FAR) that process is provided at 2 CFR 200.110(a) further clarify how agency adopting
applies to Federal procurement and discussed in this document above. regulations in subtitle B apply to future
contracts—it is sometimes necessary for Thus, at least for agencies that have amendments of subtitle A. The proposal
OMB to amend the regulatory text to already implemented the OMB will also clarify the status of OMB’s
align with legislative changes on requirements, OMB’s proposed regulatory text throughout subtitle A as
specific government-wide effective amendments related to this objective are an OMB regulation. Agencies will
dates. Secondary agency rulemakings primarily intended to clarify the status remain partners with OMB in the
could result in staggered and sometimes of the regulatory text in subtitle A, process for future amendments by
wildly inconsistent effective dates for rather than constituting a fundamentally participating in OMB’s development of
OMB’s amendments and associated new approach or change in direction. As proposed policy changes and continuing
policies across the Federal discussed above, the approach to implement the effective requirements.
Government—with agency rules only described in this document is consistent However, OMB proposes to clarify that
being proposed and finalized as agency with how most agencies have the legal mechanism for futures updates
resources allow. This would effectively implemented OMB amendments of the will be streamlined to a single Federal
delay implementation of OMB’s regulatory text of 2 CFR subtitle A since Register document issued by OMB
government-wide requirements by an the Uniform Guidance was first adopted following public N&C, rather than
extended period of time. Such delays by agencies in 2014. dozens of rulemakings across the
would create confusion for recipients, The proposed clarification is also Federal Government with generally
auditors, and the entire Federal grants procedurally similar to the long- identical requirements but inconsistent
community, and be inconsistent with standing ‘‘adoptable guidance’’ model effective dates. For the reasons
OMB’s statutory authority to set for the suspension and debarment discussed above, beginning dozens of
government-wide requirements for requirements in 2 CFR part 180.59 In the agency N&C rulemakings after OMB has
grants administration that agencies must 2005 preamble establishing part 180, completed its own N&C rulemaking
follow. Moreover, agencies would OMB observed the need to ‘‘[s]treamline process would be impractical,
generally have little of substance to say the process for updating the inefficient, and impede OMB’s ability to
in response to public comments on government-wide requirements’’ by timely exercise its own statutory
government-wide policy requirements centralizing the process for substantive authorities to set government-wide
already settled by OMB pursuant to its updates to the rule at OMB—with requirements for grants management.
agencies only needing to complete one c. OMB government-wide authorities
own statutory authorities and firmly
initial adoption. The ‘‘adoptable related to grants administration.
established in the regulatory text of
guidance’’ approach allowed OMB to Congress authorized OMB at 31 U.S.C.
subtitle A.
‘‘publish proposed changes to the 503 to set government-wide
B.2. Proposed Clarification of [government-wide requirements] in the requirements for grants administration,
Regulatory Structure Federal Register, with an opportunity and agencies must follow the OMB
for the public to comment.’’ Once requirements in their award programs.
a. In general. Through this agencies had completed the initial step Congress also authorized OMB under
rulemaking, OMB and Federal of adopting the part 180 guidance in the Federal Grant and Cooperative
grantmaking agencies seek to agency regulations, ‘‘the process for Agreement Act of 1977, codified in
collectively clarify how government- future updates [would] be complete relevant part at 31 U.S.C. 6307, to issue
wide ‘‘financial management policies [each time that] OMB issues . . . final interpretative guidelines to Federal
and requirements’’ codified in OMB’s 2 guidance’’ amending the regulatory text. agencies to promote consistent and
CFR regulatory text in subtitle A will be In other words, agencies would ‘‘not efficient use of Federal financial
implemented by Federal agencies in the need to amend their regulations assistance awards. Congress also
future.58 The current classification of adopting the guidance’’ through dozens authorized OMB at 31 U.S.C. 7505 to
the OMB regulatory text as ‘‘guidance, of separate agency rulemakings provide government-wide requirements
not regulation’’ is confusing for award following future OMB amendments. for Single Audits of recipients, and
recipients, is generally inconsistent with That regulatory structure has remained agencies must also follow those
the history of agency implementation of the status quo for 2 CFR part 180 for the requirements. Congress also authorized
OMB amendments since 2014, and fails past 20 years. OMB under the Transparency Act (Pub.
to provide adequate predictability and Like part 180, OMB also issued part L. 109–282), as amended, to provide
transparency for the Federal grants 200 for agency adoption in 2013, which instructions to agencies related to
community regarding how future OMB represented a major improvement from ensuring public transparency of their
amendments of the regulatory text of the older patchwork of OMB Circulars assistance programs—including with
subtitle A will be implemented by and agency-specific regulations. respect to award recipients, award
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agencies. To promote predictability, However, despite the information amounts, unique entity identifiers,
transparency, uniformity, efficiency, provided at 2 CFR 200.110(a), questions subawards, and various other
and other objectives described in this regarding the process for agency information—which agencies are also
document, OMB seeks to provide implementation of OMB amendments of required to follow. At 31 U.S.C. 6105,
further clarity regarding the regulatory part 200 have lingered, which has Congress also assigned oversight
structure and status of 2 CFR through impacted the predictability, responsibility to OMB for the exercise of
this rulemaking. transparency, and consistency of all authorities and responsibilities
related to Federal program information.
58 31 U.S.C. 503(a)(2). 59 70 FR 51863, 51864 (Aug. 31, 2005). At 41 U.S.C. 1125, Congress authorized
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Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules 32207
OMB to prescribe government-wide Federal awards, and the date on which reality of needing to ensure that OMB is
requirements that agencies must follow those rules become effective. The able to efficiently exercise its statutory
in providing for the procurement of modified regulatory text would resolve authority to provide government-wide
property or services by recipients of recurring questions on these topics, and grants management requirements in a
Federal grants or other forms of reinforce that OMB’s government-wide timely and responsive manner. Given
financial assistance. Pursuant to all of requirements are legally binding that updates to OMB’s requirements in
these authorities, and others described pursuant to OMB’s statutory authorities subtitle A may already take upwards of
in this document, the proposed rule for future updates on the effective date a year to complete prior to any
clarifies that 2 CFR subtitle A is OMB’s of OMB’s amendments of the regulatory secondary agency rulemakings—from
issuance of government-wide text. OMB’s authorities contemplate initial policy development at OMB to
requirements under Federal law that OMB setting binding policy related to inter-agency coordination, drafting and
agencies must carry out. financial assistance for all agencies— obtaining clearance for proposed
d. Summary of proposed Uniform which is effectively what the Uniform rulemaking documents, completing N&C
Grants Regulation (UGR). Under the Guidance already does today. This procedures, responding to comments,
proposed rule, OMB will issue the proposal will simply clarify the drafting and obtaining clearance for
‘‘Uniform Grants Regulation’’ as an regulatory status of subtitle A, and final rulemaking documents, additional
OMB regulation with one government- ensure that OMB policies apply inter-agency coordination, and
wide effective date, pursuant to OMB’s uniformly across all agencies on the typically, but not necessarily, providing
statutory authority described above, to effective date intended by OMB without some gap between issuance of the final
provide government-wide grants the need for redundant and open-ended rule and its effective date—the proposal
management requirements. The text of 2 agency rulemaking processes to will ensure that OMB can actually
CFR subtitle A will be revised to reflect implement them. From a recipient’s establish government-wide
its status as an OMB regulation, perspective, OMB’s requirements in 2 requirements within a reasonable
especially in key provisions in parts 1 CFR will still generally carry the same timeframe. The proposal will clarify that
and 200. OMB proposes to remove the weight as before, but calling them OMB agencies do not need to initiate another
statement in 2 CFR 1.05 that the regulations will further emphasize and lengthy N&C rulemaking process just to
regulatory text is only guidance and clarify their binding effect across the implement OMB amendments for which
‘‘not regulation.’’ Otherwise, the Federal Government. OMB already followed robust public
structure of title 2 of the CFR will (ii) Reduced redundancy. The N&C procedures. The framework will
generally remain the same, with OMB proposed clarification will promote ensure that OMB remains able to
requirements in subtitle A and agency efficiency and save government efficiently respond to emerging
‘‘adopting’’ chapters in subtitle B. resources by preventing the need for compliance issues or implement new
Federal agencies join this proposal, and dozens of secondary agency statutory requirements in a timely
plan to issue the final rule as a joint rulemakings. Agencies may still manner across all agencies.
rulemaking with a common preamble to undertake such rulemakings as Both the Federal Government and
implement this structure. appropriate to make adjustments in American public will benefit from such
The proposed changes will provide timely adjustments. This may include,
their own chapters, but will not be
regulatory clarity to the entire Federal for example, faster incorporation of
required to in the case of every OMB
grants community regarding the legislative changes from Congress. This
amendment. Existing provisions in the
effective date and binding effect of is far more workable and efficient than
regulatory text, which OMB proposes to
OMB’s policies and requirements, and an alternative model in which dozens of
retain, also provide mechanisms for
their application to agencies and agency rulemakings to implement new
recipients for new awards issued after exceptions and otherwise maintaining
requirements would only begin after
the effective date of OMB’s alignment with agency program statutes
OMB has already completed a year-long
amendments. The ‘‘Uniform Grants in the case of conflict.60
process to propose and make
Regulation’’ framework will avoid the Moreover, agencies will not be
amendments. Such an alternative model
need for dozens of secondary agency entirely removed from the process of 2
would effectively prevent timely
rulemakings merely to reaffirm identical CFR updates, but will remain involved
implementation of needed government-
requirements that apply government- as partners in OMB’s regulatory process, wide policy reforms related to grants
wide—which OMB is authorized by and through participation in interagency management, and frustrate OMB’s
statute to determine. Following 2014, workgroups such as the Council on ability to efficiently perform its own
such secondary agency rulemakings Federal Financial Assistance. Although, statutory functions.
have generally not occurred under the in general, agencies will not need to (iv) Note regarding proposed names
existing structure. Advantages of the directly join future OMB rulemakings, for title 2 and part 200. This document
clarifications provided through the they will remain engaged in the proposes to use ‘‘Uniform Grants
‘‘Uniform Grants Regulation’’ proposal interagency review processes, ensuring Regulation’’ (UGR) as a plain language
include: (1) uniform, transparent that agency grant experts have name or designation for 2 CFR part 200
requirements; (2) reduced redundancy appropriate input on legal and practical following issuance of a final rule. See
and regulatory volume; and (3) a considerations for their agencies before § 1.100 (proposed version). OMB does
streamlined approach allowing for rules are proposed or finalized by not propose a change to the existing
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efficient updates and responsive OMB.61 header for Title 2, which would remain
government-wide policy changes. The (iii) Efficiency and responsiveness. ‘‘Federal Financial Assistance.’’ Thus,
proposed approach will also maintain The ‘‘Uniform Grants Regulation’’ the various parts of Title 2 would
public participation. framework recognizes the practical collectively constitute the Federal
(i) Uniformity, transparency, and Government’s ‘‘Regulation for Federal
60 See 2 CFR 200.100(a)(1), 200.101(a)(2) and (d),
regulatory clarity. The ‘‘Uniform Grants Financial Assistance’’ (RFFA), while
200.102, 200.105, and 200.106.
Regulation’’ framework will make it 61 See also section IV.C.2.g of this preamble part 200 would constitute the UGR.
easier for recipients and auditors to find regarding ‘‘continued public and agency OMB also does not propose a change to
and understand the rules that apply to participation.’’ the (formal) header for part 200, which
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32208 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
would remain ‘‘Uniform Administrative updates, and all stakeholders will have ensuring that the requirements
Requirements, Cost Principles, and the ability to comment on any changes contained in 2 CFR are only those that
Audit Requirements for Federal proposed by OMB. Thus, interested OMB finds necessary for the efficient
Awards’’ (UAR). Thus, the name UGR, parties can focus on a single unified implementation and oversight of
as referred to in § 1.100 (proposed proposal rather than tracking and assistance programs authorized by law.
version), would be used in a way similar commenting on dozens of separate Some of the changes related to this
to how ‘‘Uniform Guidance’’ is currently agency proposals. Agencies will still be objective are aimed at ensuring that
used as a plain language way of involved during the development stage recipients can focus on timely and
referring to part 200—despite its formal for OMB policy amendments and efficient delivery of core program
header. The acronym UAR would also various interagency review periods, and purposes. As discussed under the first
remain acceptable and accurate, as still have the ability to raise agency- objective in this document, in previous
would simply referring to ‘‘part 200.’’ specific issues with OMB before years Federal agencies often required
The proposed name of UGR for part amendments are proposed or finalized. award recipients to spend great amounts
200 would not have any impact on the After OMB’s final determination, of time, effort, and financial resources to
part’s broader applicability to secondary public N&C periods at each implement unlawful DEI mandates and
cooperative agreements and other forms agency would serve little practical other unnecessary add-on requirements
of financial assistance, which remain purpose, as the key policy decisions that increased project costs, complexity,
subject to part 200 under the proposed would already have been made by OMB and completion timelines, but did not
regulatory text. See 2 CFR 200.1 and with input from both public serve the underlying public purpose of
200.101 (proposed versions). Grants are commenters and Federal agencies.62 support of the relevant assistance
a common and widely used form of program. By contrast, under the
Federal financial assistance. See 2 CFR B.3. Proposed Changes to Agency
Chapters in Subtitle B of 2 CFR proposed version of the regulation,
200.1. Outside of its technical meaning, OMB seeks to ensure that Federal
the term ‘‘grant’’ is also generally Through this proposed rulemaking,
agencies will appropriately reduce the
understood and used in ordinary speech certain Federal grantmaking agencies
scope of award activities to only what
by the general public in a way that more that currently lack an existing chapter in
is necessary to achieve the objectives
technical terms may not be. OMB 2 CFR subtitle B propose to add
identified in law consistent with
proposes to refer to part 200 as the UGR chapters, which is intended to
Executive Branch policy. If finalized,
to retain a name that will be widely streamline implementation and reduce
variability across the Federal recipients should be able to restore
understood, easy to say, and still similar
Government. Federal agencies that have focus on achieving core public purposes
to the existing name for part 200—the
existing chapters in 2 CFR subtitle B in a cost-efficient and timely manner.
‘‘Uniform Guidance’’—which is widely
known and used throughout the Federal propose certain targeted and conforming In seeking to reduce recipient burden,
financial assistance community. Under changes to support OMB’s broader OMB also reviewed the guidance to look
the existing structure, ‘‘Uniform rulemaking effort. Following this for other opportunities to further
Guidance on Grants’’ and ‘‘Uniform rulemaking, subtitle B will provide a standardize and streamline the
Grants Guidance’’ (UGG) are also complete list of all grantmaking Federal grantmaking process where feasible. For
frequently used to refer to part 200, agencies,63 including certain agency- example, in § 200.202, the proposed
which are also similar to the name specific policies and procedures. This regulation encourages the use of multi-
proposed in this document. proposed change will make OMB’s year awards, thereby reducing the
In selecting a proposed plain language policies and requirements in 2 CFR frequency of applications and
name and acronym, OMB also truly ‘‘uniform’’ across the Federal individual awards that are generated
considered ‘‘Financial Assistance Government for first time since OMB’s each year. In § 200.204, OMB
Regulation,’’ but determined that the ‘‘Uniform Guidance’’ was established in encourages Federal agencies to adopt
acronym for this name would conflict 2013. more efficient Notice of Funding
with the acronym that is already used Opportunities and application practices,
C. Objective 3: Reducing Recipient including the use of statements of
for, and widely known as applying to,
Burden interest, which will simplify the process
the Federal Acquisition Regulation
(FAR). Creating a second FAR that The third and final objective of this for thousands of prospective applicants.
applies to Federal financial assistance rulemaking is to reduce recipient In addition, the proposal would require
instead of Federal procurement burden. The proposed revisions in that all Federal funding opportunities be
contracts would cause confusion and be support of this objective are aimed at posted on Grants.gov ensuring agencies
unworkable. OMB believes that UGR use a single, consistent platform that
will be a simple and clear way to refer 62 A Federal agency would still be permitted to
reduces duplicative processes and
engage in such secondary rulemaking procedures if increases transparency for award
to part 200 following issuance of the it determines that codified exceptions are needed
final rule and easily distinguishable and consistent with procedures and basic applicants. Under the proposed
from the FAR. As is currently the case, parameters for codified exceptions set forth in the regulation, agencies are not prohibited
the regulatory text of 2 CFR part 200 regulatory text of subtitle A. As under the existing from announcing opportunities on their
regulatory text, an agency could immediately
may also be referred to as the UAR implement any exceptions required by statute in
websites or in other locations in
(based on the formal header) or simply advance of a secondary rulemaking and without the addition to Grants.gov. Federal agency
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as ‘‘part 200.’’ need for additional approval from OMB under 2 heads (or designees) may approve
e. Continued public and agency CFR. See 200.101(d)(1) and 200.102(b) (proposed exceptions to this requirement when the
version).
participation. Finally, the proposed 63 Limited exceptions are noted at 2 CFR 1.221
agency determines that publicly
‘‘Uniform Grants Regulation’’ (proposed version) for agencies with limited, if any, announcing an opportunity would pose
framework will also maintain public rulemaking authorities. Like all other agencies, the a national security risk or is in the
and agency participation in the listed agencies at 2 CFR 1.221 (proposed version) national interest of the United States.
would be required to implement OMB’s
development of policies. OMB will government-wide requirements in 2 CFR subtitle A,
The removal of superfluous policy
continue to follow public N&C but would not be required to issue regulations due requirements reduces costs and
rulemaking procedures for substantive to the limited nature of their authorities. complexity without undermining
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Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules 32209
accountability for Federal financial Parts 25, 170, 175, 180, 182, and 183 ‘‘regulation.’’ Finally, OMB proposes to
assistance awards. OMB proposes limited revisions in update the definition of ‘‘covered
OMB is also committed to continuing combatant command’’ in § 183.35 to
parts 25, 170, 175, 180, 182, and 183. As
to support this objective following the simply reference the definition existing
throughout the regulatory text, OMB
current rulemaking process. For in law.
proposes to replace the term ‘‘guidance’’
example, efforts to address this objective
with ‘‘regulation’’ or ‘‘policy,’’ as Part 176—Award Terms for Assistance
may also involve longer-term initiatives
appropriate, for the reasons set forth Agreements That Include Funds Under
to: (i) review and streamline existing
above. In some cases, depending on the the American Recovery and
government-wide forms to ensure that
context, the use of the word ‘‘guidance’’ Reinvestment Act of 2009
only necessary data is being collected a
is maintained, such as instances in OMB proposes to remove the
single time; and (ii) work with Federal
which the term does not refer to the guidance in part 176 related to the
grantmaking agencies to eliminate or
regulatory text of 2 CFR. OMB also American Recovery and Reinvestment
reduce burdensome program regulations
proposes various grammatical changes Act of 2009 (ARRA). Part 176 was
and requirements.
in these parts. initially issued to govern the use of
V. Regulatory Impact Analysis In part 170, OMB proposes certain funds appropriated under ARRA as part
The attached Regulatory Impact revisions to reflect that, as of March 8, of the Nation’s economic recovery
Analysis (RIA) evaluates the benefits, 2025, FSRS.gov was retired, and all efforts following the 2008 financial
costs, and transfers associated with the subaward reporting data and crisis. The regulations in part 176 are no
proposed rule. For example, the RIA functionality are now on SAM.gov. longer needed because awards are no
evaluates the proposed elimination of Thus, certain references to FSRS are longer being made under ARRA. The
fixed amount awards and fixed amount replaced with references to SAM.gov. removal of part 176 aligns with OMB’s
subawards; proposed payment In part 180, consistent with other broader objective of streamlining
accountability reforms, including changes throughout the regulatory text, Federal financial assistance regulations
requirements for Federal payment OMB proposes to remove the statement by eliminating outdated or unnecessary
requests; proposed reforms related to in § 180.15 that the policy contained in provisions that no longer serve a
subrecipient oversight; proposed the regulatory text ‘‘is guidance not practical function.
clarifications of authority for regulation.’’ OMB also proposes to
revise § 180.25 to clarify that agencies Part 200—Uniform Administrative
termination and suspension of Federal Requirements, Cost Principles, and
awards; proposed changes to national must not deviate from the requirements
of this part on matters for which Audit Requirements for Federal Awards
policy provisions; and proposed
changes related to eligibility restrictions discretion is not provided. Throughout part 200, consistent with
for research and development awards. OMB proposes to revise §§ 180.745 changes discussed above, OMB
The draft RIA finds that the proposed and 180.840 to require agencies to proposes to replace the term ‘‘guidance’’
rule is expected to generate qualitative provide entities or individuals with a with ‘‘regulation’’ when referring to the
benefits, modest administrative costs, transcribed record of fact-finding regulatory text of 2 CFR. In some cases,
and minimal transfer effects. OMB proceedings for suspensions and OMB also proposes to replace the term
invites comments on the analysis debarments within five business days. ‘‘guidance’’ with ‘‘policy’’ or other terms
provided in the attached RIA. Under this proposal, the entity or that fit within the context of the
individual requesting the transcript regulatory text.
VI. Section-By-Section Discussion of the would remain responsible for
Proposed Revisions to Subtitle A of 2 Subpart A—Acronyms and Definitions
purchasing it and paying applicable
CFR costs. Although not addressed directly Section 200.1—Definitions
OMB invites comments on the in either the existing or proposed OMB proposes to revise § 200.1 to
proposed revisions throughout subtitle regulatory text, in some cases it is align with the proposed policy changes
A of 2 CFR. possible that other laws may restrict and to be consistent with Federal law.
what information may be provided in These changes include revisions to the
Part 1—About Title 2 of the Code of this context, such as classified definitions for ‘‘Federal award date,’’
Federal Regulations and Subtitle A information. ‘‘improper payment,’’ ‘‘personally
OMB proposes to revise various In § 180.915, OMB proposes to update identifiable information (PII),’’ and
sections of 2 CFR part 1 to replace the reference to the Program Fraud Civil ‘‘unobligated balance.’’ Other proposed
references to ‘‘guidance’’ with Remedies Act (PFCRA) of 1986 to reflect changes include removing definitions
‘‘regulation’’ to reflect that the OMB that, on December 23, 2024, Congress for ‘‘fixed amount awards’’ and
policies contained in 2 CFR subtitle A amended the PFCRA, including ‘‘protected personally identifiable
constitute an OMB regulation. changing its name to the Administrative information (Protected PII).’’ The
Additional analysis related to this False Claims Act (AFCA).64 existing definition of Protected PII is not
change is provided in this document Similarly, in part 182, OMB proposes necessarily consistent with other OMB
above. to remove the statement in § 182.15 that guidance, which does not distinguish
OMB proposes to add a new § 1.221 the policy contained in the regulatory between PII and Protected PII. Other
to explain that certain listed Federal text ‘‘is guidance not regulation.’’ In conforming changes were proposed in
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agencies received approval from OMB to § 182.25, OMB also proposes to clarify other sections of the regulatory text that
implement the OMB regulations in that Federal agencies must not deviate use the term Protected PII.
subtitle A as policy applicable to their from the requirements of this part on OMB also proposes to revise the
Federal awards without establishing matters for which discretion is not definition of ‘‘compliance supplement’’
agency regulations in subtitle B. provided. to delete the words ‘‘annually updated.’’
Approval of this alternative OMB also proposes to revise part 183 OMB is in the process of reevaluating
implementation method is generally to replace the term ‘‘guidance’’ with the appropriate frequency for issuing
based on the limited rulemaking the compliance supplement. Pursuant to
authorities of these agencies. 64 Public Law 118–159, sec. 5203(a). the Financial Management Risk
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32210 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
Reduction Act (Pub. L. 118–207), OMB government-wide policy in the agency’s Section 200.111—English Language
and the Office of Inspector General for implementing regulations in subtitle B. OMB proposes to revise § 200.111 to
the Department of Health and Human It should be recognized that focus only on the basic requirement that
Services (HHS) are currently analyzing § 200.101(d)—under both the existing all Federal announcements,
the single audit process. OMB plans to and proposed versions—only applies to applications, and Federal award
engage stakeholders ahead of any Federal programs to which part 200 information must be in the English
substantial changes. applies. The proposed policy regarding language and must be in terms of U.S.
Subpart B—General Provisions program applicability in this section dollars. This revision is intended to
remains generally unchanged. The highlight the importance of recipients
Section 200.101—Applicability proposed edits regarding regulatory being able to understand Federal award
conflicts seek to increase uniformity and requirements and program information
OMB proposes to revise
transparency regarding management and in English to effectively meet program
§ 200.101(b)(4) to remove references to
administration of Federal financial objectives and communicate with
fixed amount awards. OMB proposes to
assistance across the Federal Federal officials about program and
remove the reference to fixed amount Government. Recipients, subrecipients, Federal financial assistance matters.
awards for consistency with other and auditors should not have to
changes proposed in this document, speculate or guess regarding which Section 200.112—Conflict of Interest
which eliminate the use of both fixed regulatory provisions govern a Federal OMB proposes to revise § 200.112 to
amount awards and subawards, which program or specific Federal award. require, in the interest of transparency,
can limit transparency and hinder that a recipient or subrecipient must
effective oversight. OMB also proposes Section 200.102—Exceptions disclose whether any employees who
to include a reference to the FAR in worked on the proposal or will support
§ 200.101(c)(2). OMB proposes to revise § 200.102(b)
regarding ‘‘statutory and regulatory the resulting Federal award were
OMB also proposes to make certain exceptions’’ to include reference to the employed by the awarding Federal
clarifying edits regarding which proposed change at § 200.101(d)(2) agency within the preceding two years
provisions govern in the case of conflict discussed above. OMB also proposes to prior to application submission. OMB
in paragraph (d) of § 200.101. OMB now revise § 200.102(c) regarding ‘‘Federal further clarifies that this information is
proposes to address statutory and agency exceptions’’ to remove reference for informational purposes and does not
regulatory conflicts in separate to fixed amount awards for reasons by itself represent a conflict of interest.
paragraphs. Paragraph (d)(1) regarding discussed elsewhere in this document. This revision is intended to enhance
statutory conflicts remains substantially Additionally, OMB proposes to revise transparency and allow Federal agencies
unchanged except for the proposed the authority for case-by-case exceptions to identify potential conflicts of interest
deletion of the reference to regulations. made by a Federal agency to highlight arising from recent employment
OMB proposes a new paragraph (d)(2) examples of sections in which other relationships between agency staff and
under § 200.101 addressing non- approval by OMB is expressly required recipient personnel. While the
statutory conflicts with agency by this part, such as at § 200.340. disclosure does not create a prohibition
regulations. OMB proposes to specify or automatic bar to participation, it
that the following provisions of part 200 Section 200.106—Agency provides awarding Federal agencies
will govern in any circumstances where Implementation and Responsibilities with visibility into situations where
they conflict with a regulatory provision prior employment could give rise to
not required by Federal statute: all OMB proposes to revise § 200.106 to questions about impartiality,
sections in subpart F and § 200.340 in add a new paragraph (b) regarding preferential treatment, or insider
subpart D. For other non-statutory agency responsibilities. The proposed knowledge. This change strengthens
conflicts with an agency’s regulatory paragraph references the responsibilities integrity standards in the award-making
provision, the proposed regulatory text of Federal agencies under other parts of process while limiting burdens by
would encourage Federal agencies to OMB’s grants administration policies in requiring only disclosure, not additional
apply the government-wide policies in the regulatory text of 2 CFR. This approval or review.
part 200 to the greatest extent permitted proposed change will further clarify that
by law. OMB also proposes to Federal agencies are responsible for Section 200.113—Mandatory
recommend that Federal agencies clarify adhering not only to part 200, but also Disclosures
which provisions govern in funding to the other existing parts contained in OMB proposes to revise § 200.113 to
opportunities and Federal award subtitle A, including parts 25, 170, 175, require an Office of Inspector General to
documents. The proposed text explains 180, 182, 183, and 184. transmit any disclosures it receives
that the default presumption would Section 200.110—Effective Date under this section to the United States
generally be for the Federal agency to Attorney’s Office for the District of
apply the government-wide policies in OMB proposes to revise § 200.110 to Columbia within ten days of receipt.
this part if it can do so consistent with clarify and supplement the existing The purpose of this revision is to
law. Finally, the proposed revision policy in paragraph (a). The proposed strengthen enforcement and
recommends that Federal agencies also changes to paragraph (a) are discussed accountability by ensuring that credible
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work to resolve such non-statutory in further detail in section IV.C of this allegations of fraud or misconduct are
conflicts consistent with their preamble regarding the proposed promptly transmitted to prosecutorial
rulemaking authorities; applicable clarification of the regulatory structure authorities. This 10-day transmission
provisions in part 200, such as of 2 CFR. As discussed above, the standard would reduce delays and
§§ 200.102, 200.106, and 200.110; or proposed changes to paragraph (a) are accelerate prosecutorial awareness,
both. For example, this may involve generally consistent with the existing thereby reducing the risk that criminal
amending an agency regulation outside regulatory text, but provide further (or civil) misconduct continues without
of 2 CFR to eliminate the conflict or clarity and context regarding its the initiation of appropriate remedies if
codifying an exception to the meaning. warranted.
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Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules 32211
Subpart C—Pre-Federal Award that goals and objectives must be which authorize the establishment of
Requirements and Contents of Federal consistent with the public purpose of uniform policies governing the
Awards Federal authorizing legislation and management of Federal financial
Section 200.201—Use of Grants, aligned with administration policies assistance, this proposed change is
Cooperative Agreements, and Contracts and priorities. intended to ensure consistent
OMB also proposes to add five new application of eligibility limitations
OMB proposes to revise § 200.201(b) paragraphs. In § 200.202(c), OMB applicable to research and development
to eliminate the use of fixed amount proposes to clarify that Federal agencies awards. OMB and the participating
awards unless otherwise authorized by must develop Federal programs and agencies seek to ensure that such
Federal statute. Fixed amount awards implement activities under those awards remain aligned with the national
were introduced in 2014 with the initial programs in a manner that ensures interest of the United States. As with
release of the Uniform Guidance. compliance with all applicable other sections of the regulatory text, the
Extensive standards and guardrails restrictions on the use of Federal funds, policy must be implemented consistent
regarding the use of fixed amount including ensuring that Federal program with relevant appropriations and
awards were never established in the funds are only used for public purposes authorizing statues.
regulatory text of part 200, sometimes of support authorized by law. This In § 200.202(f), OMB proposes to add
resulting in inconsistent use or proposed addition reiterates what has a paragraph that encourages agencies to
application of this type of award across long been a foundational principle of design awards as multi-year award
Federal agencies. In response to public Federal financial assistance: funding when consistent with program
comments on the 2024 rulemaking, must only be used to ‘‘carry out a public objectives and subject to restrictions in
OMB attempted to establish additional purpose of support or stimulation law. Under this approach, awards
standards and provisions related to authorized by law,’’ 65 not for other would use budget periods longer than
fixed amount awards in the 2024 extraneous activities or initiatives of one year instead of requiring annual re-
revisions. OMB now proposes to change recipient organizations. This proposed competition. Such awards must be
course, and eliminate this type of award revision increases transparency and structured to avoid Antideficiency Act
from part 200. OMB is concerned that predictability for applicants and violations. This proposed revision
use of this type of award can limit recipients by ensuring that program promotes efficiency and reduces
transparency and hinder effective announcements are aligned with unnecessary administrative burden on
oversight, and believes the limited statutory authority from the outset. both agencies and recipients. In
standards for fixed amount awards in OMB proposes to include an example addition, the proposed revision
part 200 remain inadequate to address related to ensuring that program funds provides greater funding stability for
these concerns. The existing regulatory are not used to subsidize political recipients, enabling long-term planning
text also remains ambiguous with activities or initiatives unrelated to and execution of complex projects.
respect to application of the cost authorized public purposes. Lastly, in § 200.202(g), OMB proposes
principles and certain other In § 200.202(d), OMB proposes to add to add a paragraph that would require
requirements to fixed amount awards, a paragraph explaining that Federal agencies that issue Federal financial
with important context, in some cases, agencies may, to the extent permitted by assistance for scientific research to
only provided in the 2024 preamble. law, restrict eligibility among different categorize those awards as basic
This proposed change will ensure types of nonprofit organizations. This research, applied research, and
increased consistency across Federal proposed revision promotes experimental development consistent
agencies in the execution and transparency by ensuring applicants can with the definitions in OMB Circular A–
implementation of Federal financial determine eligibility without guessing 11. This categorization would need to be
assistance and promote greater or interpreting agency intent. In communicated to the recipient and
transparency and oversight. OMB addition, the proposed revision ensures included in the terms and conditions of
proposes to relocate the definition of that such restrictions are not applied in the award.
‘‘fixed amount awards’’ to this section. a manner inconsistent with law. As a
Section 200.204—Notices of Funding
This proposed change is not intended to result, applicants will have greater
Opportunities
impact any existing fixed amount clarity and confidence about eligibility
awards or subawards issued prior to the requirements before spending time and OMB proposes to revise in § 200.204
effective date of the proposed rule. resources on preparing applications. to clarify, supplement, and revise the
OMB also proposes a minor revision In § 200.202(e), OMB proposes to add government-wide policy regarding
to § 200.201(a) to make Federal agencies a paragraph to establish a government- notices of funding opportunity,
the exclusive focus. OMB proposes to wide policy governing eligibility and commonly referred to as NOFOs. OMB
add a cross-reference to § 200.331, the use of international elements in proposes to require that Federal
which more directly addresses how Federal research and development agencies must publicly announce
pass-through entities determine the awards. Through this proposed change, funding opportunities for all
appropriate type of agreement for a OMB seeks to strengthen alignment discretionary awards—not just those
subaward or contract. between Federal research and that will be openly competed.
development funding and national Consistent with the definition of
Section 200.202—Program Planning and priorities, enhance consistency across discretionary award and longstanding
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Design grant-making agencies, and clarify practice, OMB also proposes to clarify
OMB proposes to revise § 200.202(a) expectations for applicants, while that, as appropriate and consistent with
to further clarify the elements of preserving appropriate flexibility to authorizing law, funding opportunities
program design. As ‘‘goals and support international engagement that may allow for open competition, limited
objectives’’ do not directly ‘‘provide’’ demonstrably advances the interests of competition, or selection on a non-
meaningful results, OMB proposes to the United States. Consistent with competitive basis. In addition, OMB
clarify that the goals and objectives OMB’s authorities discussed above, also proposes to require that applicants
must ‘‘aim to achieve meaningful apply for awards using Grants.gov
results.’’ OMB also proposes to clarify 65 See 31 U.S.C. 6304, 6305, and 6307. unless a program specific exception is
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32212 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
expressly authorized by Federal statute OMB proposes that Federal agencies, Section 200.206—Federal Agency
or approved by the Federal agency head when feasible, should strive to ensure Review of Risk Posed by Applicants
(or designee). OMB also highlights the that NOFOs are accessible to a broad OMB proposes to revise
importance of drafting NOFOs in plain range of applicants, including those that § 200.206(b)(2) to expand the list of
language so that completing the have not previously received Federal factors that agencies may consider when
application generally does not require awards. In addition, OMB proposes a evaluating applicant risk. The changes
the applicant to employ technical or new requirement that Federal agencies clarify that agencies may assess an
legal experts. These proposed revisions may be required to submit a report to applicant’s financial capacity to manage
streamline and standardize the policies OMB detailing the specific recipients or high-dollar awards, in addition to
for Federal funding opportunities, while types of recipients that received Federal overall financial stability. The revisions
also promoting transparency regarding awards from the Federal agency over a also clarify that prior performance must
the use of Federal tax dollars. In
specific time period. These proposed be evaluated against the goals of the
addition, the proposed revisions reduce
revisions strengthen clarity and funding opportunity, and that both
barriers for participation by promoting
accessibility obligations for agencies positive and negative outcomes must be
greater accessibility for eligible
and provide OMB with oversight tools given equal weight. OMB also proposes
applicants.
OMB also proposes to revise this to ensure funding is not inappropriately to add a provision that agencies may
section by adding a new paragraph (c) concentrated among a narrow set of consider an applicant’s history of
regarding use of Statements of Interest recipients. questionable practices based on publicly
(SOI). The proposed paragraph available and verifiable information. In
Section 200.205—Federal Agency addition, OMB proposes to add a
encourages agencies to use SOIs as part Review of Merit of Proposals
of their NOFOs when high application provision that agencies may consider an
volume or lengthy proposals are applicant’s compliance with foreign gift
OMB proposes to revise § 200.205 to
expected. These revisions are intended and contract disclosure requirements, as
strengthen requirements for agency
to reduce burden on applicants who applicable. Additionally, OMB proposes
merit review and to establish a new pre- a new provision that agencies may
would otherwise prepare lengthy, issuance review process consistent with
resource-intensive proposals with little consider an applicant’s affiliations with
Executive Order 14332. Under the organizations engaged in activities that
chance of being selected for funding in proposed requirements for pre-issuance
some cases. The proposed revision violate Federal law, undermine public
review, as part of the broader merit safety or national security, or advocate
would also improve efficiency by review process, agencies must ensure
focusing agency review on the most for the overthrow of the United States
that proposals selected for funding are Government. Lastly, OMB proposes a
competitive applicants.
OMB also proposes to revise the consistent with applicable law, Federal new provision that agencies should
existing best practice that executive agency priorities, and the national consider, as applicable, an applicant’s
summaries should not exceed 500 interest. Consistent with the Executive compliance with foreign gift and
words. OMB proposes to make this a order, senior appointees must conduct contract disclosure requirements under
requirement, but allow Federal agency these reviews and apply specific section 117 of the Higher Education Act
heads (or their designee) to authorize principles when evaluating proposals. of 1965 (Pub. L. 89–329, as amended,
exceptions. This proposed revision These principles include ensuring that codified at 20 U.S.C. 1011f). The
would more consistently provide discretionary awards advance the proposed revisions are intended to
applicants with a clear, concise President’s policy priorities, prohibit provide agencies with clearer authority
overview of NOFOs while maintaining the use of funds for discriminatory or to evaluate financial and organizational
agency flexibility when needed to otherwise impermissible purposes, and capacity, integrity, and institutional
communicate complex opportunities. emphasize ensuring compliance with affiliations in order to mitigate risks and
As a result, applicants will more often applicable law. Additionally, the protect the integrity of Federal
be able to quickly assess whether a proposed revisions encourage agencies programs.
program is relevant before reading the to broaden the range of recipients, Section 200.207—Standard Application
entire funding opportunity. prioritize institutions demonstrating
OMB also proposes to revise the Requirements
rigorous and reproducible scholarship,
requirement that opportunities be incorporate benchmarks for measuring OMB proposes to revise § 200.207 to
posted for no less than 30 days unless performance of ‘‘Gold Standard clarify that Federal agencies must
the agency determines that exigent Science,’’ and direct agencies to weigh periodically review programmatic and
circumstances exist. Under the administrative requirements specific to
institutional commitment to research
proposed revision, agencies would be the agency, program, or award(s) to
integrity when making award decisions.
required to include such a determine whether such requirements
Proposed revisions in this section also
determination in the NOFO. This are unnecessary and not required by this
clarify that peer review remains
proposed revision is intended to prevent part. Federal agencies should also
unreasonably short application advisory and does not replace agency update OMB annually on any such
windows that disadvantage certain discretion. Finally, the proposed requirements that have been removed.
applicants. The proposed revision also revisions clarify that agencies are not
Section 200.208—Specific Conditions
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promotes fairness, accountability by required to issue awards solely as a
Federal agencies, and adequate result of issuing a NOFO. These OMB proposes to revise § 200.208 to
preparation time for applicants. As a proposed updates are intended to clarify how agencies may apply, adjust,
result, applicants will have a more enhance consistency across agencies, and remove specific conditions under
predictable timeframe to prepare strong accountability, and alignment of Federal Federal awards. OMB proposes to
applications. awards with administration priorities, authorize agencies, subject to applicable
Lastly, OMB proposes several while also reducing the risk of award law, to add or remove specific
revisions related to the full text of being made contrary to statutory or conditions throughout the period of
funding opportunities. Specifically, policy requirements. performance based on the risk factors
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Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules 32213
identified in paragraph (c) or other internet. To the extent that applicable Section 200.218—Prohibition of Using
factors associated with a recipient or general term and conditions are not Federal Awards To Promote or Support
program. available on the internet, agencies Theories of Disparate-Impact Liability
A new requirement is proposed to would be responsible for providing OMB proposes a new § 200.218
require that any such adjustments based them to the recipient—typically in related to Executive Order 14281,
on any of the factors listed in paragraph electronic form—with the Federal award ‘‘Restoring Equality of Opportunity and
(c) must occur within 15 calendar days instrument. Federal agencies would still Meritocracy.’’ Consistent with the
after the agency’s determination. The be permitted to mail a hard copy of the Executive order, this section proposes to
existing regulatory text already terms and conditions to recipients upon establish a government-wide policy in 2
preserves the right of agencies to impose request even with removal of this CFR regarding use of Federal financial
specific conditions based on these provision, but would not be required to assistance to promote or support
enumerated factors, which recipients provided that the recipient has theories that impose disparate-impact
knowingly accept when they agree to electronic access. liability based on federally protected
receive awards. OMB also proposes to
Section 200.216—Prohibition of Certain characteristics such as race, sex, or age.
clarify that specific conditions not based
on factors in paragraph (c) may be Equipment, Services, and Systems OMB proposes to direct agencies and
added or removed during the period of pass-through entities, to the maximum
OMB proposes to revise § 200.216 to extent permitted by law, to ensure that
performance only with the agreement of incorporate a new legal requirement
the recipient. awards are administered in a manner
related to the use of unmanned aircraft that does not promote or support
In § 200.208(d), OMB also proposes to systems procured with Federal financial
expand the list of examples of specific theories of disparate-impact liability,
assistance. First, OMB proposes including by not issuing terms,
conditions to include requiring amending the section header to reflect a
information on payments to contractors conditions, or guidance that would
broader scope that continues to include, advance theories of disparate-impact
or vendors, or financial integrity-related but is no longer limited to,
site visits. These examples are intended liability. Recipients and subrecipients
telecommunications and video are also directed to avoid using Federal
to provide agencies with more practical surveillance. A new paragraph (a) is
tools to address risk identified during award funds for this purpose unless
proposed to appropriately frame the expressly required by law. OMB
the administration of Federal awards.
existing prohibition on certain proposes to recognize an exception
At § 200.208(f), OMB also proposes a
telecommunications and video related to analysis for internal use if the
new paragraph recognizing that agencies
may impose program-level specific surveillance equipment or services. activities are not funded by the Federal
conditions when elevated programmatic OMB also proposes removing the award and not used in connection with
risks are identified across a Federal existing paragraph (d). Although still activities under the award. OMB
program. The proposed text explains technically a legal requirement, proposes a definition of disparate-
that agencies may remove such considering that the statute has been in impact liability to ensure clarity and
conditions once the underlying risks effect since 2020 and Federal agencies consistency. The proposed definition is
have been resolved, thereby allowing are unlikely to still be funding a generally consistent with the Executive
the use of program-level conditions to transition to different systems, OMB order. These proposed revisions are
remain tied to ongoing risk management considers this language to be outdated intended to align government-wide
rather than continuing indefinitely. and no longer necessary for express administration of Federal financial
Collectively, these proposed changes inclusion in 2 CFR. assistance with administration policy
provide agencies with greater flexibility OMB proposes to add a new and to reinforce the principle that merit-
to manage risk during award paragraph (b) in § 200.216 under the based opportunity—rather than theories
administration while establishing header: ‘‘Prohibition on procurement of disparate-impact liability or other
safeguards related to transparency and and operation of prohibited unmanned forms of unlawful discrimination based
fairness. aircraft systems.’’ This paragraph will on race or other protected
implement the requirements of section characteristics—will govern the
Section 200.211—Information 1825 of the American Security Drone administration of Federal awards.
Contained in the Federal Award Act of 2023 (Pub. L. 118–31). This The legal authority for this section
OMB proposes to revise § 200.211 to statute prohibits Federal agencies from (hereinafter referred to as the
clarify that Federal agencies must issuing Federal financial assistance that ‘‘Disparate-Impact Provision’’) is similar
always include the termination results in the procurement of unmanned to the authority for including the
provisions under § 200.340 in each aircraft systems prohibited by the unlawful DEI provision in § 200.300, as
Federal award or expressly incorporate Federal Acquisition Security Council both are generally intended to prevent
them by reference, and must inform (FASC), and requires recipients and discrimination on the basis of federally
recipients of any additional termination subrecipients to implement specific protected characteristics. To limit
provisions that apply to the award. This safeguards and compliance measures for repetition in this preamble, OMB
revision is intended to ensure recipients these systems. The statutory includes further analysis of the
are always clearly and unambiguously requirements became effective on Disparate-Impact Provision under
informed of the potential for December 22, 2025. Thus, agencies, § 200.300 in connection with the
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termination under § 200.340, including recipients, and subrecipients should be unlawful DEI provision, including
termination based on discretion of the aware that the statute already applies analysis of legal authority and related
Federal agency. OMB also proposes even before the proposed revision of considerations.66
deleting the reference to providing ‘‘a this section becomes final. See OMB
copy of the terms and conditions’’ to the Memorandum M–26–02 dated 66 See also 90 FR 57141 (Dec. 10, 2025) (rule
recipient upon request. This November 21, 2025, ‘‘Ensuring amending DOJ’s implementing regulations for Title
VI of the Civil Rights Act of 1964 to remove
requirement is outdated given the access Government Use of Secure Unmanned disparate-impact provisions); DOJ Press Release of
that applicants and recipients now have Aircraft Systems and Supporting United Dec. 9, 2025, ‘‘Department of Justice Rule Restores
to general terms and conditions on the States Producers.’’ Continued
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32214 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
Section 200.219—Prohibition of to evade these requirements through Section 200.220—Prohibition of Using
Discriminatory Event Services pretextual or post hoc forum Federal Funds for Covered Foreign
To ensure that Federal funds are not classifications. Collaborations
used, directly or indirectly, to subsidize The proposed language in § 200.219 is To protect the national security
violations of the First Amendment of not intended to alter the allowability of interests of the United States and to
the U.S. Constitution involving costs under subpart E, including costs ensure consistent implementation of
suppression of free speech of disfavored associated with speakers or events. longstanding statutory restrictions, OMB
groups, OMB proposes a new § 200.219. Rather, it would require that any fees, proposes a new § 200.220 to prohibit the
The proposed provision would establish security costs, or other charges imposed obligation or expenditure of Federal
in the regulatory text that public entities in connection with events be applied in funds to support certain foreign
that are a recipient or subrecipient of a viewpoint-neutral and consistent collaborations involving covered foreign
Federal financial assistance must not manner. countries or covered foreign entities.
discriminate on the basis of the OMB also proposes to clarify Some Federal statutes direct Federal
viewpoint, content, or subject matter of application to non-public entities. To agencies to restrict the use of
speech—including on the basis of ensure that Federal funds are not used appropriated funds for bilateral or
political, ideological, or religious in a manner inconsistent with the First multilateral activities with foreign
affiliation or perspective—in providing Amendment, OMB proposes to apply adversaries and entities affiliated with
services for events, meetings, or other the requirements of paragraph (a) to foreign military or intelligence services.
expressive activities. This requirement non-public entities to the extent that the Most notably, section 1340 (a) of the
would ensure that public entities do not relevant activities are within the scope ‘‘Department of Defense and Full-Year
improperly use control over facilities or of a Federal program under which the Continuing Appropriations Act’’ for
services to disadvantage or suppress the non-public entity accepts a Federal fiscal year 2011 (Pub. L. 112–10)
speech of disfavored groups. The award. Applying the prohibition to (commonly referred to as the ‘‘Wolf
proposed text further provides that it activities within the scope of a Federal Amendment’’) prohibited the National
applies regardless of whether an event program does not present constitutional Aeronautics and Space Administration
is directly funded by the Federal award concerns under the First Amendment, and the Office of Science and
if it occurs on property or facilities provided that the Federal agency does Technology Policy from using
under the control of the public entity. not seek to leverage funding to regulate appropriated funds to develop, design,
As public entities are subject to the First speech outside the contours of the plan, promulgate, implement, or execute
Amendment in their own right, this Federal program.69 By knowingly any bilateral policy, program, order, or
broad application is constitutionally accepting such a Federal award, the contract of any kind to participate,
permissible.67 recipient or subrecipient acknowledges collaborate, or coordinate bilaterally
The proposed additions are intended its ability to perform the federally with China or any Chinese-owned
to prevent public entities from using funded activities in a manner consistent company, absent specific statutory
Federal funds—including indirect costs with law and its own constitutional authorization. The Wolf Amendment
used for buildings and facilities—in a rights. For example, if a non-public has continued to apply as a rider in
discriminatory manner. This recipient or subrecipient agrees to subsequent annual appropriations
requirement would further ensure that accept a Federal award that includes acts.70
public entities receiving Federal awards hosting a public forum, it must comply Federal financial assistance is
do not use their control over facilities or with the terms and conditions of the frequently awarded through grants,
services to disadvantage disfavored Federal award in a viewpoint-neutral cooperative agreements, and subawards
groups, such as colleges and universities manner. that may support collaborative research,
charging additional fees—sometimes Proposed paragraph (b) must be technical assistance, or programmatic
referred to as ‘‘heckler’s fees’’—to implemented in full accordance with activities involving foreign entities.
provide security for conservative the U.S. Constitution. Outside of While the Wolf Amendment only
speakers.68 Consistent with the First performance of award activities, the applies directly to specific agencies and
Amendment, the proposed language proposed revision must not be appropriations, OMB proposes to find
should not be construed to prohibit construed to require a non-public entity that a uniform regulatory standard,
public entities from enforcing content- to make its property, facilities, or providing consistent application of
and viewpoint-neutral time, place, and services available for speech, these restrictions across Federal
manner restrictions, or from applying expression, or events in a manner that assistance programs, would reduce risk
reasonable, viewpoint-neutral would either directly violate its First related to national security and program
restrictions in nonpublic forms. If Amendment rights or otherwise require integrity for all agencies and the Federal
finalized, public entities must not seek access or association that would Government as a whole.
constitute compelled speech or The proposed § 200.220 establishes a
Equal Protection for All in Civil Rights association under the U.S. Constitution. government-wide baseline rule
Enforcement.’’ Consistent with law, a Federal agency prohibiting recipients and subrecipients
67 See, e.g., Christian Legal Soc. Chapter of the
may consider adjusting the terms and from using Federal funds to support
Univ. of California, Hastings Coll. of the L. v.
Martinez, 561 U.S. 661 (2010) (holding that public conditions of a Federal award to a non- bilateral or multilateral collaborations,
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universities may adopt neutral, generally applicable public entity to clarify the application of agreements, programs, or activities with
access rules but cannot invoke their own expressive this provision and to ensure that covered foreign countries or covered
autonomy to exclude disfavored viewpoints); Bd. of performance of required award activities
Regents of Univ. of Wisconsin Sys. v. Southworth,
foreign entities, unless expressly
529 U.S. 217 (2000) (holding that viewpoint can proceed consistent with law. authorized by Federal statute or
neutrality is mandatory when distributing student
activity funds). 69 See, e.g., Agency for Int’l Dev. v. All. for Open 70 See, e.g., Public Law 117–103, sec. 526, which
68 See, e.g., Young America’s Foundation Press Soc’y Int’l, Inc., 570 U.S. 205 (2013) (holding that, applied to the National Aeronautics and Space
Release, ‘‘YAF Wins Landmark Free Speech as a general matter, if a party objects to limits Administration (NASA), the Office of Science and
Lawsuit, UC Berkeley To Pay $70,000 And Rescind imposed by a grant, its recourse is to decline the Technology Policy (OSTP), and the National Space
Unconstitutional Policies,’’ Dec. 3, 2018. funds). Council (NSC).
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Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules 32215
approved by the Federal agency in Illegal Discrimination and Restoring September 12, 2025, OMB issued
accordance with the proposed exception Merit-Based Opportunity’’ (Ending Memorandum M–25–33, which
authority and applicable law. This Discrimination Executive Order); 72 instructed agencies to follow the July
provision is intended to ensure that Executive Order 14168 of January 20, 2025 DOJ Guidance when managing
Federal financial assistance is not used, 2025, ‘‘Defending Women from Gender Federal programs and overseeing
directly or indirectly, to support Ideology Extremism and Restoring recipients of Federal funding. Most
activities that may pose a risk to U.S. Biological Truth to the Federal recently, on December 2, 2025, DOJ’s
national security, defense, or Government’’ (Gender Ideology OLC released an opinion finding that
intelligence interests. Congress has Executive Order); 73 and Executive certain race-based grant programs
expressly determined that such a risk Order 14187 of January 28, 2025, administered by the Department of
exists in the case of some agencies. ‘‘Protecting Children from Chemical and Education violate the Fifth
The prohibition would apply Surgical Mutilation’’ (Protecting Amendment’s equal-protection
regardless of whether Federal funds are Children Executive Order). The component.78
used for direct programmatic activities, President later issued Executive Order 2. Proposed revisions. OMB, in
research, technical assistance, travel, or 14281 of April 23, 2025, ‘‘Restoring consultation with DOJ and other
indirect costs allocable to such Equality of Opportunity and agencies, proposes to amend paragraph
collaborations. This approach would Meritocracy’’ (Restoring Equality (b) of § 200.300, to provide that, in
ensure that restrictions on foreign Executive Order). administering Federal awards, to the
collaboration—including those On March 21, 2025, the Department of maximum extent permitted by law, the
expressly required by law—are not Justice (DOJ) issued guidance to all Federal agency or pass-through entity
circumvented through the structure of Federal agencies regarding must ensure that the Federal award is
funding mechanisms or cost allocation implementation of EOs 14151 and not used to fund, promote, encourage,
practices. 14173 (March 2025 DOJ Guidance).74 subsidize, or facilitate:
The proposed rule also provides for Subsequently, on July 29, 2025, DOJ • ‘‘Diversity, equity, and inclusion’’
limited exceptions where expressly issued additional guidance regarding (DEI) or ‘‘diversity, equity, inclusion,
authorized by Federal statute or where unlawful discrimination (July 2025 DOJ and accessibility’’ (DEIA) policies,
the head of the Federal agency (or Guidance).75 The July 2025 DOJ principles, or practices that violate any
designee) determines that the activity Guidance was intended to ensure that applicable Federal anti-discrimination
does not pose a risk to national security recipients of Federal funding do not laws. This includes racial preferences or
and is in the national interest of the engage in unlawful discrimination.76 In other forms of racial discrimination
United States. These exceptions are particular, it clarified that Federal used by the recipient or subrecipient
intended to preserve necessary agency antidiscrimination laws apply to that violate any applicable Federal anti-
discretion while ensuring that any programs or initiatives that involve discrimination laws, including activities
departure from the general prohibition discriminatory practices, including where race or intentional proxies for
is subject to appropriate senior level those labeled as DEI programs. Entities race will be used as a selection criterion
review and accountability at that receive Federal funds, like all other for employment or program
grantmaking agencies. This provision entities subject to Federal participation (the ‘‘Unlawful DEI
does not prohibit recipients from antidiscrimination laws, must ensure Provision’’);
engaging in foreign collaborations using that their programs and activities • Gender ideology as defined in
non-Federal funds. comply with Federal law and do not Executive Order 14168. Gender ideology
Subpart D—Post Federal Award discriminate on the basis of race, color, includes theories or ideologies that deny
Requirements national origin, sex, religion, or other the biological reality of sex or the sex
protected characteristics—no matter the binary in humans, or endorse or
Section 200.300—Statutory and program’s labels, objectives, or advocate for the notion that sex is a
National Policy Requirements intentions. DOJ’s guidance emphasized chosen or mutable characteristic (the
OMB proposes to revise § 200.300 to the significant legal risks of initiatives ‘‘Gender Ideology Provision’’); or
streamline existing references to legal that involve discrimination based on • The so-called ‘‘transition’’ of a child
and policy obligations. OMB also protected characteristics and offered under 19 years of age from one sex to
proposes to supplement § 200.300 to non-binding best practices to help another, including the chemical and
reflect key administration policies and entities that receive Federal funds avoid surgical mutilation of children. The
priorities. the risk of violations and the revocation term ‘‘chemical and surgical mutilation’’
1. Executive orders and Executive of Federal grant funding.77 On has the meaning provided in Executive
Branch guidance. In January 2025, Order 14187 (the ‘‘Protecting Children
President Trump issued a series of 72 90 FR 8633.
Provision’’).
73 90 FR 8650.
Executive orders (EOs) establishing a The qualifier ‘‘to the maximum extent
74 DOJ Memorandum of March 21, 2025,
government-wide policies to, consistent permitted by law’’ is intended to ensure
‘‘Implementation of Executive Orders 14151 And
with applicable law, end Federal 14173: Eliminating Unlawful DEI Programs in that Federal agencies give due
funding for unlawful DEI programs, Federal Operations.’’ consideration to applicable authorizing
promotion of ‘‘gender ideology,’’ and 75 DOJ Memorandum of July 29, 2025, ‘‘Guidance
legislation for their programs when
the so-called ‘‘transition’’ of a child for Recipients of Federal Funding Regarding
applying this provision. As discussed
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Unlawful Discrimination’’ (‘‘July 2025 DOJ
under 19 years of age from one sex to Guidance’’). above, OMB also proposes a related
another. These include Executive Order 76 DOJ Press Release of Jul. 30, 2025, ‘‘Justice
14151 of January 20, 2025, ‘‘Ending Department Releases Guidance for Recipients of to DEI Initiatives, Feb. 26, 2026; and EEOC
Radical and Wasteful Government DEI Federal Funding Regarding Unlawful Questions and Answers about ‘‘What You Should
Programs and Preferencing’’ (DEI Discrimination.’’ Know About DEI-Related Discrimination at Work,’’
77 For additional Executive Branch guidance https://www.eeoc.gov/wysk/what-you-should-know-
Executive Order); 71 Executive Order regarding application of Federal anti-discrimination about-dei-related-discrimination-work (last visited
14173 of January 21, 2025, ‘‘Ending laws, see also U.S. Equal Employment Opportunity April 14, 2026).
Commission (EEOC) Letter to the Fortune 500 78 Constitutionality of Race-Based Dep’t of Educ.
71 90 FR 8339. Companies Regarding Title VII Compliance Related Programs, 2025 WL 4055305 (Dec. 2, 2025).
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32216 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
provision at § 200.218 (the ‘‘Disparate- DOJ’s position regarding Bostock v. by-case approval of requests for an
Impact Provision’’). Clayton County (‘‘February 2025 accommodation or exemption.81 Federal
The existing language in paragraph (a) Bostock Memo’’). Consistent with the agencies, pass-through entities,
of § 200.300 already provides that the February 2025 Bostock Memo and the recipients, and subrecipients should be
Federal agency or pass-through entity July 2025 DOJ Guidance, Federal aware of their ongoing statutory
‘‘must manage and administer the agencies may decide what additional obligations regarding religious liberty
Federal award in a manner so as to guidance, if any, to provide recipients of and conscience. The proposed revision
ensure that Federal funding is expended Federal financial assistance regarding of § 200.300 is intended to clarify that
and associated programs are the Supreme Court’s decision in Bostock conscience and religious liberty are
implemented in full accordance with v. Clayton County. To the extent protected under multiple statutes and
the U.S. Constitution’’ and ‘‘applicable additional government-wide guidance the Federal Government will enforce
Federal statutes and regulations,’’ regarding the decision is provided in the such statutes as applicable.
including ‘‘those prohibiting future, it would most likely come from Recent and ongoing litigation
discrimination.’’ The proposed the Attorney General or the Civil Rights regarding some of the topics addressed
amendments would clarify and Division at DOJ. in § 200.300 indicates the need for a
emphasize specific applications of that Finally, OMB proposes to add a new clear regulatory framework reflecting
principle consistent with direction in paragraph (c) regarding non- administration policy that can be
the President’s EOs and recent DOJ discrimination against faith-based uniformly applied by Federal agencies
guidance. In addition, the proposed organizations. The proposed paragraph to recipients of Federal financial
revisions would also reinforce that use (c) provides that Federal agencies and assistance. By engaging in N&C
of Federal funds must remain properly pass-through entities may not rulemaking, OMB seeks to provide
aligned with core public purposes discriminate against or in favor of an clarity regarding government-wide
authorized by law, not diverted to applicant on the basis of the policies, consider public input, and
subsidizing radical political ideologies, organization’s religious character, arrive at a final policy that is consistent
harmful experimentation on American affiliation, exercise, or lack thereof, nor with law, including longstanding legal
children,79 or unlawful discrimination. on the basis of conduct that would not principles applicable to Federal
OMB also proposes to add revised be considered ground to favor or financial assistance.
language in § 200.300(a) clarifying that, disfavor a similarly situated secular
in managing and administering Federal organization. It also provides that faith- 3. Authorities of OMB and agencies.
awards, no person otherwise eligible based organizations are eligible to apply OMB’s legal authorities for this
will be excluded from participation in, for Federal financial assistance on the rulemaking are discussed in various
unlawfully denied the benefits of, or same basis as any other organization. It sections of this preamble, and need not
otherwise subjection to unlawful also explains that applicants that meet be repeated here at length. Generally,
discrimination in the administration of all eligibility requirements may be OMB relies on authorities including 31
Federal programs, activities, projects, considered for a Federal award under a U.S.C. 503 and 31 U.S.C. 6307 to
assistance, and services. Such non- notice of funding opportunity. establish government-wide policies and
discrimination language would In both the existing and proposed requirements related to the management
encompass requirements, as applicable, versions of § 200.300(a), the examples of of Federal financial assistance across all
not to discriminate on various bases, laws applicable to Federal awards Federal agencies. These provisions
including race, color, national origin, include ‘‘religious liberty [laws] . . . authorize OMB to set uniform
disability, sex, religion, or conscience. and those [laws] prohibiting conditions on Federal awards to ensure
OMB also proposes to amend discrimination.’’ All Federal agencies that Federal funds are expended in
paragraphs (b) and (c) of the 2024 must comply with the Religious accordance with U.S. law and policy.
version of § 200.300 to remove Freedom Restoration Act (RFRA) (42 In addition, Congress has broadly
commentary on the Supreme Court’s U.S.C. 2000bb, et seq.) and any authorized Federal agencies—including
decision in Bostock v. Clayton County, applicable statutes prohibiting those participating in this rulemaking—
140 S. Ct. 1731 (2020). OMB proposes discrimination on the basis of religion to enforce Federal nondiscrimination
to find that this commentary is or protecting the exercise of conscience. laws in their assistance programs.
unnecessary within the government- The First Amendment, RFRA, and Recipient of Federal financial assistance
wide regulatory text, and no longer applicable statutes prohibiting must comply with applicable civil rights
consistent with Administration policy. discrimination based on religion or laws, including Title VI of the Civil
The Gender Ideology Executive Order protecting the exercise of conscience Rights Act of 1964, Title VII of the Civil
explained at section (3)(f) that the prior require Federal agencies, pass-through Rights Act of 1964, Title IX of the
Administration’s position regarding entities, recipients, and subrecipients to Education Amendments of 1972, and
Bostock v. Clayton County is legally respect the exercise of religion. This the Equal Protection Clause of the
untenable and has harmed women. The includes considering and providing Fourteenth Amendment.82 OMB’s
order also directed the Attorney General reasonable accommodations or statutory authority includes
to issue guidance to agencies to correct exemptions for religious or conscience- coordinating such cross-cutting
the misapplication of the Supreme based objections as required by law.80 requirements as applied to
Court’s decision, and to assist agencies Where such legal protections apply,
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in protecting sex-based distinctions. The Federal agencies, pass-through entities, 81 A ‘‘case-by-case exemption procedure leaves
Acting Associate Attorney General recipients, and subrecipients should not religious organizations unable to predict their legal
exposure’’ and does not ‘‘further[ ] any compelling
issued guidance to the DOJ Civil Rights structure internal procedures in a way antidiscrimination interests.’’ Catholic Benefits
Division on February 12, 2025 clarifying that would require discretionary case- Ass’n v. Kennedy, No. 3:23–cv–00203–PDW–ARS
(D.N.D. June 5, 2025), Dkt. 78 at 14. See also
79 White House Fact Sheet of Apr. 28, 2025, 80 See, e.g., Burwell v. Hobby Lobby Stores, Inc., Catholic Benefits Association, ‘‘CBA Permanently
‘‘Report to the President on Protecting Children 573 U.S. 682 (2014) (holding that RFRA requires the Protected from Federal Gender Transition
from Surgical and Chemical Mutilation Executive government to use the least restrictive means when Mandates,’’ Jun. 9, 2025.
Summary.’’ substantially burdening religious exercise). 82 See July 2025 DOJ Guidance.
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administration of Federal financial particular assistance programs, Congress & Hosp. v. Halderman, 451 U.S. 1, 17
assistance. certainly afforded executive agencies (1981). The Court has further explained
In designing assistance programs and with authority to condition Federal that ‘‘Congress must express clearly its
making new Federal awards, it is both awards to only be used for those intent to impose conditions on the grant
permissible and required for Federal congressionally-sanctioned purposes, of federal funds so that the States can
agencies to review proposed uses of and not for extraneous ideological knowingly decide whether or not to
funds to ensure they remain aligned activities inconsistent with anti- accept those funds.’’ Id. at 24. The
with Congressional intent, and are not discrimination laws or Executive Pennhurst notice principle also
improperly diverted to subsidizing Branch policy. Discretion to attach generally applies to an executive
activities that fall outside of public award conditions can be analyzed by agency’s discretionary decision to
purposes authorized by law—especially reference to both authorizing legislation impose conditions on awards based on
if those activities conflict with key for particular assistance programs and its discretion available under law. By
administration policies expressed in other government-wide legislation that defining these parameters in the
EOs. The use of Federal funds must applies to all assistance programs, such regulatory text of 2 CFR based on the
always remain consistent with the as Federal anti-discrimination laws and statutory authorities outlined above,
purpose of appropriations and the OMB’s authorities related to providing OMB and the participating agencies will
authorizing program statutes of the coordinated requirements for the further ensure that such conditions are
Federal agency. See, for example, 31 management and administration of unambiguously incorporated by the
U.S.C. 1301(a) (commonly referred to as Federal financial assistance across the Federal agencies in award agreements.
the ‘‘Purpose Statute’’). The Federal Federal Government. The formal codification of the
Grants and Cooperative Agreements Act Based on the authorities of OMB and principles in regulation will eliminate
of 1977—which authorizes OMB to agencies summarized above, Congress any ambiguity for the Federal grants
provide government-wide guidelines ‘‘to has afforded the Executive Branch community regarding what conditions
promote consistent and efficient use’’ of discretion to establish the proposed apply to Federal awards on these topics.
grants and cooperative agreements—also provisions, which ensure that award Following issuance of a final rule, a
recognizes that Federal awards must be funds are used solely for authorized recipient will have no basis to claim
used to ‘‘carry out a public purpose of public purposes and not for other that it was unaware that, for example,
support or stimulation authorized by extraneous activities that conflict with DEI practices that violate Federal anti-
law.’’ 31 U.S.C. 6304, 6305, and 6307. anti-discrimination laws or Executive discrimination laws, such as disparate
Federal agencies are not required to Branch policy. Unlike a hypothetical treatment on the basis of race or sex,
subsidize activities that fall outside of award condition designed to induce would jeopardize its Federal funding.
the core public purposes of the recipients to undertake activities Even under the existing version of
programs they administer. OMB is not unrelated to the underlying purposes of OMB’s guidance, there is already little
aware of Federal laws that expressly a particular Federal award program, or no basis for such claims considering
require funding the relevant activities these provisions are designed to ensure that the relevant principles arise under
referenced in the proposed regulatory that Federal funds are only used for long-standing anti-discrimination
text of § 200.300. Multiple Federal authorized public purposes—not statues already referenced in the
statutes, however, support not funding ideological side missions that are regulatory text, governing constitutional
them, including Federal misaligned with Federal law and policy, principles, and binding Supreme Court
nondiscrimination laws and other laws including program goals and objectives precedent. See, for example, Students
referenced in relevant EOs and the July as designed by Federal agencies in for Fair Admissions, Inc. v. President &
2025 DOJ Guidance. accordance with law. Activities Fellows of Harvard Coll., 600 U.S. 181
The EOs discussed above also provide performed under Federal awards must (2023) (‘‘Students for Fair Admissions’’).
further indication of Executive Branch be aligned with both relevant legislation The principles were also recently
policy relevant to these proposals to be for assistance programs and the highlighted and reinforced by a series of
implemented consistent with law. discretionary design of those programs high-profile Presidential EOs and
While EOs themselves do not supersede by Federal agencies within legislative guidance documents from DOJ.
statutes, they guide Executive Branch bounds. Under the proposed text, OMB Following formal codification of these
polices and actions where discretion will clarify that award funds must not principles in 2 CFR through issuance of
exists under statute. Here, OMB and the be used in support of activities that a final rule, OMB will make these
participating agencies are using their violate Federal anti-discrimination laws, conditions even more clear and
discretion to shape financial assistance promote divisive ideologies unrelated to unambiguous to all applicants for and
policy consistent with applicable law program goals and objectives, or are recipients of financial assistance. This
and the clear direction from the otherwise unrelated to Federal agency’s promotes fairness, as all applicants will
President provided in the recent EOs. discretionary design of programs to know the rules upfront when applying
Similar to the EOs, the proposed rule satisfy core public purposes authorized for and accepting new awards. It will
expressly includes the qualifier ‘‘to the by law. also avoid the ‘‘unfair surprise’’
maximum extent permitted by law’’ to 4. Clear and unambiguous concerns discussed in Pennhurst and
recognize that particular assistance incorporation in award agreements. By similar cases.
programs could have purposes, codifying the provisions in 2 CFR, and 5. Spending Clause framework. The
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requirements, or limitations affecting incorporating them in new award proposed revisions are also consistent
application of this provision—although, agreements, applicants and recipients with established jurisprudence related
as discussed below, that generally will be provided with clear and to the Spending Clause. In South Dakota
should not occur based on the way OMB unambiguous notice of their v. Dole, the Supreme Court outlined the
has designed the proposed regulatory applicability. The Supreme Court has framework governing the authority of
text. explained that if ‘‘Congress intends to Congress under the Spending Clause to
The proposed revisions in § 200.300 impose a condition on the grant of attach funding conditions to Federal
are consistent with relevant authorizing federal [funds], it must do so award programs. 483 U.S. 203 (1987).
laws. By defining public purposes for unambiguously.’’ Pennhurst State Sch. Under this framework, a funding
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32218 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
condition must: (1) promote ‘‘the activities carried out under Federal the proposed regulatory text for this
general welfare;’’ (2) be clear and awards are reasonably related to the rulemaking merely says that Federal
unambiguous so that recipients can Federal interest in the project or award funds may not be used for certain
‘‘knowingly’’ accept the term; (3) be program at issue, and not improperly defined activities—which will generally
reasonably related ‘‘to the federal diverted to other activities or ideological fall outside of the authorized public
interest in particular national projects or initiatives unrelated to the purposes purposes a particular award program is
programs’’ at issue (or ‘‘reasonably authorized by Congress and intended to support—without
calculated’’ to support ‘‘a purpose for implemented by discretion of the attempting to more broadly regulate
which the funds are expended’’); (4) not Executive Branch. There is a strong other activities beyond the scope of the
induce recipients to engage in activities Federal interest in ensuring that award Federal award.
‘‘that would themselves be activities do not drift away from Fifth and finally, the proposed
unconstitutional;’’ and (5) not be unduly authorized public purposes into revision is not unduly coercive. An
coercive such that ‘‘pressure turns into activities that conflict with key applicant or prospective recipient may
compulsion.’’ Id., at 207–11 (quotations Executive Branch policies expressed in simply opt out of particular Federal
omitted). Because executive authority to Presidential Executive orders and award or program if it cannot manage to
attach funding conditions to assistance reflected in program design by agencies. design its project or program in a way
awards is derived from the enactment of Thus, preventing violations of that does not violate Federal anti-
legislation by Congress, evaluating nondiscrimination laws, avoiding discrimination laws or use Federal
executive authority to attach such circumstances in which Federal award funds to promote gender ideology or
conditions also generally involves funds are improperly used to support assist in sex-transition procedures for
consideration of this framework. The divisive ideologies misaligned with core minors.
proposed amendment of § 200.300 is public purposes authorized by law, and 6. Permissibility under the First
well within the bounds of the protecting the health and safety of Amendment. The proposed revisions
framework provided in Dole. children are all Federal interests also do not implicate free speech
First, the proposed revision promotes applicable to all discretionary assistance concerns under the First Amendment.
the general welfare by ensuring that programs. All of OMB’s proposed revisions related
Federal funds are not used to To the extent that some as-yet to national policy are merely providing
undermine the U.S. Constitution or unidentified assistance program clear notice to applicants for, and
Federal anti-discrimination laws, to expressly required performance of such recipients of, Federal awards that,
support divisive ideologies misaligned activities without violating the U.S. unless expressly required by law,
with core purposes of discretionary Constitution, the proposed qualifier ‘‘to executive agencies do not intend to use
assistance programs and Executive the maximum extent permitted by law’’ their discretionary authority to fund
Branch policy, or to harm minors. could apply in those circumstances. The these categories of activities. As such,
Ensuring that Federal tax dollars are government-wide presumption, the proposed provisions do not infringe
only used for purposes authorized by however, would be that Federal on protected speech—they merely set
the Federal Government—and not for financial assistance programs will not parameters for Federal funding or
extraneous ideological missions be designed or administered by Federal subsidization of speech, clarifying that
unrelated to Federal awards—certainly agencies to support such activities, the Federal Government will not
promotes the general welfare. which are not expressly authorized by subsidize certain categories of
Second, the proposed rule is designed Congress and conflict with Executive ideological activities. All executive
to clearly define the prohibited Branch policy. All statutes must be agencies have received clear policy
activities in the regulatory text of 2 CFR administered in accordance with the direction through the President’s
and Federal awards made after its U.S. Constitution and Federal anti- Executive orders and other executive
effective date. This satisfies the discrimination laws, and OMB is not actions, which they will follow in their
requirement to allow recipients to aware of legislation establishing an administration of discretionary award
‘‘knowingly’’ accept the provisions. See entitlement to funds for the purposes of programs. The proposed provisions only
also Pennhurst, 451 U.S., at 17. Further unlawful discrimination, promoting apply to activities performed under the
discussion of the Pennhurst notice ‘‘gender ideology’’ as defined by federally funded award programs, and
principle as applied to § 200.300 is Executive Order 14168, or assisting in do not penalize or scrutinize recipients’
provided in the immediately preceding the so-called ‘‘transition’’ of a child speech outside of the Federal award.
section of this analysis. from one sex to another as discussed in The Supreme Court has long been
Third, the amended provision is Executive Order 14187. clear that the First Amendment provides
designed to ensure that activities Fourth, the proposed revisions do not the government significant flexibility
preformed under a Federal award induce unconstitutional conduct. On when it acts as patron to subsidize
remain aligned with the ‘‘federal the contrary, the Unlawful DEI speech under Federal spending
interest’’ in particular appropriations Provision and related Disparate-Impact programs, as opposed to when it acts as
and program statutes. See also New York Provision at § 200.218 align with the sovereign to regulate speech beyond the
v. United States, 505 U.S. 144, 167 Constitution’s equal protection scope of such programs. The distinction
(1992) (grant ‘‘conditions must (among principles by clarifying that Federal that has emerged from the Supreme
other requirements) bear some awards may not be used to support Court regarding whether a funding
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relationship to the purpose of the activities involving unlawful condition may result in an
federal spending’’). In other words, the discrimination based on protected unconstitutional burden on First
provision seeks to ensure that Federal characteristics—as discussed in more Amendment rights is between: (i)
funds are only used for the core public detail in section 8.a below. Regarding conditions that define the limits of the
purposes for which the funds are the Protecting Children Provision, no government spending program by
expended, and not for illegal court has recognized a constitutional specifying the activities the Federal
discrimination or promoting divisive entitlement to such procedures, and Government wants to subsidize; and (ii)
ideologies or harmful practices. The certainly not at the public expense. conditions that seek to leverage funding
provision would further ensure that Moreover, with regard to all provisions, to regulate speech outside the contours
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Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules 32219
of the Federal program itself. Agency for subsidize those types of activities authorities to subsidize projects or
Int’l Dev. v. All. for Open Soc’y Int’l, during the previous administration, activities promoting gender ideology,
Inc., 570 U.S. 205, 206, 215–15 (2013). there is no constitutional basis to including those seeking to replace the
The ‘‘decision not to subsidize the prevent the government from reaching a concept of biological ‘‘sex’’ with a
exercise of a fundamental right does not different policy determination regarding divisive, unstable, and subjective
infringe the right.’’ Regan v. Taxation which activities to fund during this concept of ‘‘gender identity.’’ The
with Representation of Washington, 461 administration. For the purposes of the previous administration attempted to
U.S. 540, 549 (1983). The government is proposed regulatory text for this impose this contentious concept on all
permitted to make a value judgment rulemaking—which is all that is members of the American public
regarding the public interest and relevant to this analysis—the through various funding streams,
‘‘implement that [value] judgment by government does not propose to deny including by reinterpreting Federal sex-
the allocation of public funds.’’’ Rust v. recipients the right to pursue such discrimination statutes for this
Sullivan, 500 U.S. 173, 192–93 (1991) activities outside of activities performed purpose.83 In doing so, it promoted and
(quoting Maher v. Roe, 432 U.S. 464, under their Federal awards. In the subsidized activities that diminished
474 (1977)). Thus, when acting as a context of Federal grants administration, the rights, dignity, safety, and well-
patron to subsidize speech—using OMB and Federal agencies propose to being of women; infringed on
discretion to fund certain activities make a constitutionally permissible fundamental religious liberties; and
under a Federal program and not decision not to subsidize those activities caused life-long harm to vulnerable
others—the government can choose with Federal funds unless expressly children. See Gender Ideology Executive
which activities to fund without required by law. The First Amendment Order, secs. 1 and 2; Protecting Children
implicating concerns under the First does not require providing taxpayer Executive Order, sec. 1. Pursuant to the
Amendment. ‘‘[C]ho[osing] to fund one resources to support, promote, or President’s Executive orders, the
activity to the exclusion of the other’’ is advocate for policies that the Executive Branch no longer wishes to
permissible. National Endowment for government finds are not in the public endorse the ideological doctrine that
the Arts v. Finley, 524 U.S. 569, 588 interest. Selective government funding ‘‘sex’’ and self-assessed ‘‘gender
(1988) (citation omitted). The that leaves private entities free to identity’’ are interchangeable. The
‘‘Government can, without violating the express themselves as they wish outside proposed revisions direct agencies to
Constitution, selectively fund a program of Federal award activities, and using ensure that, to the extent permitted by
to encourage certain activities it believes their own resources, does not implicate law, Federal money is no longer used to
to be in the public interest.’’ Rust at 193. concerns under the First Amendment. fund programs or projects that violate
Conversely, the government is not 7. Permissibility under equal Federal antidiscrimination laws or
required to subsidize activities that it protection principles. The proposed promote gender ideology.
does not wish to promote. Id. revisions are permissible under the The Supreme Court’s recent decision
Constitutional concerns arise only when equal protection component of Fifth in United States v. Skrmetti, 605 U.S.
the Federal Government is using the Amendment’s Due Process Clause. The 495 (2025) is instructive in relation to
funding to affect speech beyond the revisions provide clear notice that the the Gender Ideology and Protecting
scope of the federally-funded spending government will not fund these Children provisions. The Supreme
program. See also California ex rel. categories of activities, but do not direct Court evaluated a Tennessee law
agencies to take actions that prohibiting medical interventions for
Becerra v. Azar, 950 F.3d 1067, 1093
discriminate on the basis of protected ‘‘gender dysphoria, gender identity
n.24 (9th Cir. 2020) (‘‘The Supreme
characteristics such as race or sex. disorder, or gender incongruence’’ in
Court has repeatedly reaffirmed . . . First, the Unlawful DEI and Disparate-
that the government may minors. Id. at 495–7. The Skrmetti
Impact Provisions seek to ensure that plaintiffs argued that the law
constitutionally preclude recipients of unlawful discrimination is not
federal funds from addressing specified ‘‘discriminates on the basis of sex and
permitted to continue in the future. For transgender status’’ and could not
subjects so long as the limitation does example, the Equal Protection doctrine
not interfere with a recipient’s conduct withstand intermediate scrutiny. Id. at
rejects the notion that the Constitution 520. The Supreme Court rejected these
outside the scope of the federally permits—let alone requires—the
funded program.’’). arguments and upheld Tennessee’s law
Government to ‘‘intentionally allocate on rational-basis review. It first held
The proposed revisions to § 200.300 preference to those who may have little that Tennessee’s law does not classify
are focused on activities within the in common with one another but the based on sex because it ‘‘does not
scope of federally-funded programs. In color of their skin.’’ See Students for prohibit conduct for one sex that it
the previous administration, executive Fair Admissions, 600 U.S. 181, 200 permits for the other.’’ Id. at 497. Rather,
agencies frequently chose to subsidize (2023) (citation and quotation omitted). the prohibition turns on the treatment of
and expressly prioritize projects based OMB’s intent in proposing these ‘‘gender dysphoria’’ and ‘‘applies
on their ideological alignment with the provisions is to prevent unlawful regardless of a minor’s sex.’’ Id. at 511.
categories of activities discussed in the discrimination from occurring under The same principle holds true for the
proposed version of § 200.300. See, for federally-funded programs. Further proposed 2 CFR revisions. The proposed
example, E.O. 13985, sec. 1, 86 FR 7009, discussion of the Unlawful DEI regulatory text gives notice that Federal
7009 (Jan. 25, 2021) (‘‘It is therefore the provision is provided in section 8.a funding will no longer be used to
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policy of [the Biden] Administration below. subsidize or promote the doctrine that
that the Federal Government should Second, the Gender Ideology and
sex and ‘‘gender identity’’ are
pursue a comprehensive approach to Protecting Children provisions
interchangeable concepts—or other
advancing equity . . . .’’). In this distinguish between the concept of
activities based on that doctrine such as
administration, executive agencies will biological ‘‘sex’’ and other amorphous
harmful medical procedures performed
continue to use their discretionary concepts associated with gender
authorities in a manner consistent with ideology. These provisions give notice 83 See, e.g., Rachel N. Morrison, ‘‘Gender Identity
current Executive Branch policy. If that executive branch agencies will no Policy Under the Biden Administration,’’ Federalist
executive agencies were entitled to longer use their discretionary Society Review, May 2, 2022.
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32220 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
on children. The notice regarding the precedent interpreting civil-rights applicable statutes. Rather, consistent
Executive Branch’s funding priorities statutes, protecting and enforcing civil with OMB’s authorities to establish
does not discriminate on the basis of the rights includes ensuring that Federal government-wide policies for the
sex of any group or individual. Rather, funds are not used to support unlawful administration of Federal financial
it applies equally to all. discrimination based on protected assistance, the proposed text clarifies
8. Analysis of specific national policy characteristics.87 This rule reflects that how those requirements apply in the
provisions. principle and is intended to promote context of Federal awards and the
a. Unlawful DEI Provision (and equal treatment consistent with the responsibilities of agencies and
related Disparate-Impact Provision). purposes of Federal civil-rights law. recipients under part 200. It also reflects
The proposed restriction on funding for Similar principles are reaffirmed in the the established function of
unlawful DEI activities is based on the July 2025 DOJ Guidance and the OLC implementing regulations and the terms
obligation of every Federal grant opinion dated December 2, 2025.88 and conditions of Federal awards in
recipient to comply with Federal anti- The proposed provisions at ensuring that Federal financial
discrimination laws as a condition of §§ 200.300 and 200.218 are consistent assistance is administered and used in
receiving Federal funds. See July 2025 with the Federal Government’s a manner consistent with statutory
DOJ Memorandum. Expressly stating commitment to treat every American requirements and governing
this condition at § 200.300—and the with equal dignity and respect constitutional principles.
related provision at § 200.218—is discussed in Executive Order 14151, the The July 2025 DOJ Guidance provides
consistent with Federal law and well principle of merit-based opportunity illustrative examples of practices that
within OMB’s authority to clarify and discussed in Executive Order 14173, may violate underlying anti-
coordinate award conditions used by and the principles regarding unlawful discrimination statutes depending on
the Federal Government. discrimination discussed in the July the facts and circumstances of particular
Government-wide coordination is 2025 DOJ Guidance. The proposed matters. The guidance reflects the
needed to ensure that recipients of provisions will provide clear notice to longstanding Executive Branch practice
Federal awards do not continue to all recipients of the need to ensure that of issuing interpretive guidance
engage in unlawful discrimination. In their programs and activities comply regarding the application of Federal
recent years, the Federal Government with Federal law and do not anti-discrimination statutes in specific
has ‘‘turned a blind eye toward, or even discriminate on the basis of race, color, contexts. Whether a violation exists in
encouraged, various discriminatory national origin, sex, religion, or other any particular case would continue to
practices.’’ 84 For example, some protected characteristics—no matter the be determined by reference to the
recipients have adopted unlawful DEI program’s labels, objectives, or governing legal standards under
initiatives or practices that include intentions. The proposed provisions applicable anti-discrimination laws as
providing benefits or opportunities benefit both recipients and the Federal interpreted in light of controlling
based on race or sex; imposing race- Government by promoting consistency, Supreme Court precedent.
conscious quotas or objectives under a transparency, and fairness through a Consistent with longstanding
variety of names, labels, or proxies; or uniform award condition. The Executive Branch practice, OMB’s
conducting training sessions that provisions will put recipients on clear interpretation of Federal anti-
endorse and encourage racial notice that such practices constitute a discrimination laws in the context of
stereotyping and scapegoating, promote material breach of the Federal award, this proposed rulemaking is informed in
unlawful discrimination, or create a and further strengthen the government’s part by guidance issued by DOJ
hostile environment.85 regarding the application of those laws.
rights to recover misused funds or
The Supreme Court’s decision in The principles and illustrative examples
terminate awards based on
Students for Fair Admissions reaffirmed discussed in the July 2025 DOJ
noncompliance.89
that racially discriminatory practices are Based on other public comments, Guidance provide additional context
unlawful even if labeled as promoting OMB anticipates that some commenters regarding the application of those laws
‘‘diversity’’ or ‘‘equity.’’ 600 U.S. 181 for this rulemaking may contend that in certain circumstances. OMB’s
interpretation is also informed by the
(2023).86 Executive Order 14173 the Unlawful DEI Provision is
Supreme Court’s decision in Students
explains that ‘‘the Federal Government excessively vague or open to
for Fair Admissions, which addresses
is charged with enforcing our civil- misinterpretation, including by
the application of Federal anti-
rights laws’’ and states plainly that the suggesting that it could be read to
discrimination statutes in light of
purpose of the order is to ensure that the prohibit lawful activities under Federal
constitutional equal protection
Federal Government now fulfills that awards that do not discriminate based
principles, and by the December 2, 2025
responsibility ‘‘by ending illegal on protected characteristics such as race
OLC opinion addressing the
preferences and discrimination.’’ or sex. Commenters should focus their
administration of Federal programs
Consistent with Supreme Court attention on the regulatory text
consistent with statutory requirements
proposed in this document, which and governing limitations under the
84 July 2025 DOJ Guidance.
would prohibit Federal agencies from U.S. Constitution. Thus, commenters
85 See examples of unlawful discriminatory
using Federal awards to ‘‘fund, promote, may also review those sources in
policies and practices in July 2025 DOJ Guidance.
86 Specifically, the Court held that racial
encourage, subsidize, or facilitate . . . reviewing and responding to this
policies, principles, or practices that
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classifications by public institutions are subject to document.
strict scrutiny and racial classifications by private violate any applicable Federal anti- OMB believes the regulatory text
institutions can serve as basis for revoking funding discrimination laws.’’ This proposed provides sufficient clarity regarding
under Title VI. See also, e.g., Ricci v. DeStefano, text does not expand the scope of
557 U.S. 557, 579 (2009) (‘‘[E]xpress, race-based prohibited forms of discrimination, but
decision-making violates Title VII’s command that
87 EO 14281, sec. 1.
seeks comment on whether the final
employers cannot take adverse employment actions rule should include additional
88 2025 WL 4055305 (Dec. 2, 2025).
because of an individual’s race.’’); Wtolo u.
Guzman, 999 F.3d 353,361 (6th Cir. 2021) (holding 89 Additional grounds for terminating awards are discussion or elaboration in the
grant program with race and sex preferences is also available under the existing and proposed regulatory text or preamble. The
unlawful under Equal Protection Clause). versions of regulatory text in part 200. proposed regulatory text explains that
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Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules 32221
unlawful DEI would include, for discriminatory policies or practices, Rather than continuing to waste Federal
example, racial preferences or other including those that discriminate based funds in support of divisive gender
forms of racial discrimination used by on a person’s protected characteristics. ideologies, which harm women, have a
the recipient or subrecipient that violate Although DOJ’s guidance is described corrosive effect on public trust in
any applicable Federal anti- as non-binding, OMB and Federal Federal grantmaking agencies, infringe
discrimination laws, including agencies intend to clarify through this on religious liberties, and fall outside of
circumstances in which race or N&C rulemaking process how applicable specifically enumerated purposes of
intentional proxies for race are used as anti-discrimination laws apply to authorizing legislation, the Federal
a selection criterion for employment or Federal financial assistance programs. Government should instead refocus its
program participation. This example is Recipients and subrecipients should be efforts more squarely on using Federal
not exhaustive, but reflects a major aware that discriminatory practices awards for core purposes authorized by
category of conduct addressed by the already present compliance risks under law. Discretionary awards must also be
Supreme Court in Students for Fair existing anti-discrimination laws channeled through an agency’s careful
Admissions. Thus, the proposed enforced by the Executive Branch.91 In design of programs and funding
regulatory text clarifies that Federal light of the clarification provided opportunities for consistency with both
awards may not be used to support through recent Executive Branch law and, where applicable,
activities involving disparate treatment guidance—which would be given administration policy priorities.93
based on protected characteristics under regulatory effect through this N&C Ending government-sponsored
applicable law, including race or rulemaking—recipients and promotion of divisive gender ideology is
intentional proxies for race. subrecipients should not assume that critical to scientific inquiry, public
Commenters may also consider the practices previously viewed as safety, and trust in government.94
definitions and model contract clause consistent with prior Executive Branch Consistent with the principles
set forth in E.O. 14398 of March 26, guidance will necessarily satisfy outlined in Executive Order 14168, the
2026, ‘‘Addressing DEI Discrimination applicable Federal anti-discrimination proposed provision will provide clear
by Federal Contractors,’’ and provide requirements as applied to Federal notice to recipients that promoting
input regarding whether any similar awards. Recipients and subrecipients gender ideology is not something that
language would be appropriate or should evaluate existing policies and the Federal Government wishes to fund
informative in the context of this practices in reference to the legal as part of any Federal program. The
rulemaking, such as language further standards reflected in this rulemaking proposed rule ensures that federally
clarifying the application of disparate and the applicable anti-discrimination appropriated award funds—which are
treatment standards in connection with laws discussed above. Following intended for purposes like education,
activities under Federal awards.90 OMB issuance of a final rule, the policy research, and health—are not
also seeks comment on whether such proposed in this document will have improperly diverted to purposes outside
additional discussion or elaboration regulatory effect as part of the of the program’s approved scope as
would be helpful to recipients and government-wide regulations for designed by Federal agencies consistent
subrecipients in meeting their Federal financial assistance set forth in with authorizing law. Again, the
obligations under part 200 for activities 2 CFR. proposal benefits both recipients and
carried out under Federal awards, b. Gender Ideology Provision. The the Federal Government by establishing
including their internal control proposed restriction on funding the government-wide consistency through a
responsibilities under § 200.303. In promotion of gender ideology is based uniform and transparent provision.
addition, OMB seeks comment on on ensuring that Federal awards are Recipients will receive clear notice that
whether further clarification would be only used for public purposes using Federal award funds for
helpful regarding the relationship authorized by law. Within legislative unauthorized purposes related to
between § 200.300 and other provisions bounds, Federal agencies must also promoting gender ideology will
of part 200—including § 200.204, design their assistance programs and constitute a material breach of the
§ 200.211, § 200.303, and § 200.403—as funding opportunities to be consistent Federal award, and the government’s
well as the relationship between those with Executive Branch policy. rights to recover misused funds or
provisions and the terms and conditions The Federal Government has no terminate awards based on
of Federal awards issued by Federal obligation to provide taxpayer funds to noncompliance will be further
agencies pursuant to this proposed promote divisive and harmful strengthened.95
rulemaking. ideologies. On the contrary, it has
Executive Branch agencies have long c. Protecting Children Provision. The
compelling reasons not to do so. As proposed restriction on funding the so-
issued government-wide and program- explained in Executive Order 14168,
specific regulations and guidance called ‘‘transition’’ of a child under 19
government-sponsored efforts ‘‘to years of age from one sex to another is
interpreting Federal civil rights eradicate the biological reality of sex’’
requirements as applied to recipients of also based on ensuring that Federal
harm women by ‘‘depriving them of awards are only used for authorized
Federal financial assistance. This their dignity, safety, and well-being.’’
proposed rulemaking continues that public purposes. Within legislative
Various commenters have explained bounds, Federal agencies must also
established practice by clarifying how how such efforts also do significant
existing nondiscrimination design their assistance programs and
harm to public trust in government.92
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requirements apply within the scope of funding opportunities to align with
Federally-funded activities. Consistent administration policy priorities.
91 See, e.g., July 2025 DOJ Guidance.
with longstanding Executive Branch 92 See, e.g., Sarah Parshall Perry, ‘‘The Uprising:
Human Person.’’ Heritage Foundation, Mar. 20,
practice, OMB seeks to ensure that Families Clash with Schools Over LGBTQ
2023.
Federal financial assistance is not used Propaganda,’’ Heritage Foundation, Jun. 22, 2023;
93 EO 14332, sec. 4(b).
Emilie Kao, ‘‘Safeguarding Parental Rights and
by recipients or subrecipients for Protecting Children from Federally Mandated 94 EO 14168.
Gender Ideology.’’ Heritage Foundation 95 Additional grounds for terminating awards are
90 E.O. 14398 applies to Federal procurement Backgrounder No. 3744, Jan. 10, 2023; Carl R. also available under the existing and proposed
contracts and contract-like instruments. Trueman, ‘‘Gender Ideology and the Future of the versions of regulatory text in part 200.
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32222 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
This provision is also based on a using Federal award funds for these Committee of Sponsoring Organizations
compelling public welfare justification. purposes will constitute a material of the Treadway Commission (COSO).
As discussed in Executive Order 14187, breach of the Federal award, and the The U.S. Government Accountability
‘‘maiming and sterilizing a growing government’s rights to recover misused Office (GAO)—under the Direction of
number of impressionable children funds or terminate awards based on the Comptroller General—is a legislative
under the radical and false claim that noncompliance will be further branch agency; its views regarding
adults can change a child’s sex through strengthened.97 internal controls are not binding on
a series of irreversible medical 9. Conclusion. OMB is aware that it is Executive Branch regulations applicable
interventions’’ is a practice with changing existing policy in §§ 200.300 to recipients and subrecipients of
‘‘destructive and life-altering’’ and 200.218, but proposes to find that Federal awards. COSO is a private-
consequences that ‘‘will be a stain on these changes are warranted for all of sector organization. Directing recipients
our Nation’s history.’’ The Federal the reasons described in this document. and subrecipients to follow dynamic
Government has an obligation to avoid The existing language in paragraph (a) standards issued by organizations
subsidizing what it considers to be of § 200.300 already provides that the outside of the Executive Branch is
unethical and unsafe practices with Federal awarding agency must manage inconsistent with Administration policy
profound consequences on the lives and and administer Federal awards in full and the longstanding notice and
well-being of American children. Sex- accordance with U.S. law. OMB’s comment procedures used by OMB for
rejecting procedures performed on proposed revisions related to unlawful updates to 2 CFR. See 2 CFR 1.230.
children with profound and life-altering discrimination clarify and emphasize OMB cannot—and does not desire to—
consequences fall in this category. specific applications of that principle delegate rulemaking authority to GAO
Executive Order 14187 explained that a consistent with underlying statutory or COSO regarding standards for
growing number of minors soon regret authorities and recent policy direction internal control used by recipients and
that they have undergone such from the Executive Branch regarding subrecipients of Federal financial
procedures and begin to recognize the implementation and enforcement of assistance. This revision will clarify that
physical, financial, and psychological those statutes. OMB’s proposed changes the GAO and COSO frameworks do not
consequences that will follow them for in this section are also designed to apply to recipients or subrecipients as
the rest of their lives. The Executive ensure that Federal funds are only used binding or expressly recommended
Order labeled these interventions for core public purposes authorized by standards. Federal agencies, auditors,
‘‘chemical and surgical mutilation’’ of law and the terms and conditions of recipients, and subrecipients may
children, which reflects the Federal awards, and not for other continue to consider these or other
administration’s conclusion that such extraneous activities that conflict with widely recognized frameworks as
activities are not legitimate healthcare key Executive Branch policies and general reference points when
warranting government financial priorities. evaluating the adequacy of internal
support, but rather harmful OMB recognizes that the factual controls.98 OMB is only proposing to
experimentation on minors, which must findings in this document are clarify that recipients and subrecipients
end. inconsistent with certain factual have some degree of reasonable
The legal basis for the prohibition is findings and policy positions that it discretion regarding how to establish,
straightforward: there is no right or offered to support revisions of § 200.300 document, and maintain effective
entitlement to receive these procedures in 2024. OMB has provided a reasoned internal control in ways that may not be
at the public expense under Federal explanation above regarding its fully consistent with the GAO or COSO
law, and the Federal Government will rationale for the new policies. OMB frameworks. Recipients and
not—and has no legal obligation to— invites comments on the rationale subrecipients would not be required to
provide funding for them. The proposed provided in this document in relation to adopt or follow any specific framework
rule does not deny any person a reasons that supported OMB policies in issued by these external organizations.
constitutional or statutory right because 2024 or earlier years. OMB will respond OMB proposes to add § 200.303(f) to
there is no such right under Federal law. to such comments in the final rule. require all recipients and subrecipients
For all of the reasons set forth in of Federal financial assistance to
Section 200.303—Internal Controls participate in the Department of
Executive Order 14187, the Federal
Government has determined that OMB proposes a clarification in Homeland Security’s E-verify program
providing assistance for such sex- § 200.303(e) regarding confidential to confirm the employment eligibility of
rejecting procedures on children is not business information. Specifically, OMB employees and contractors hired in or
in the public interest—and it will not do proposes to include confidential performing work in the United States
so.96 business information as a type of under a Federal award. This additional
Consistent with the principles information that a recipient or safeguard would be implemented as part
outlined in Executive Order 14187, the subrecipient must take reasonable of the internal control responsibilities of
proposed provision will provide clear cybersecurity and other measures to the recipient or subrecipient. The
notice to recipients that the Federal safeguard. Federal Government has applied the E-
Government will not provide funding In § 200.303(a), OMB also proposes to
for these practices. Once again, the delete the statement that internal 98 As authorized by the Federal Managers’
controls should align with the guidance Financial Integrity Act (FMFIA) of 1982 (Pub. L.
proposal benefits both recipients and
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97–255), as amended and codified at 31 U.S.C.
the Federal Government by establishing in ‘‘Standards for Internal Control in the 3512(c) and (d), and the Government Performance
government-wide consistency through a Federal Government’’ issued by the Results Act (GPRA) Modernization Act of 2010
uniform and transparent provision. Comptroller General of the United (Pub. L. 111–352), OMB recently issued a revised
States or the ‘‘Internal Control- framework for internal control applicable to Federal
Recipients will receive clear notice that agencies through a revised version of OMB Circular
Integrated Framework’’ issued by the No. A–123 (Mar. 10, 2026). This framework does
96 See also HHS Gender Dysphoria Report of not apply directly to the recipients and
November 19, 2025, ‘‘Treatment for Pediatric 97 Additional grounds for terminating awards are subrecipients of Federal awards, but illustrates
Gender Dysphoria: Review of Evidence and Best also available under the existing and proposed internal control principles used across Federal
Practices.’’ versions of regulatory text in part 200. programs by the Federal Government.
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Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules 32223
verify program to Federal contractors for sources prior to disbursing payments agreements, but only if the use of such
over 15 years.99 OMB is now proposing made with Federal funds. agreements will advance the interest of
to expand the application of the E-verify the Federal Government associated with
Section 200.305—Federal Payment
program to Federal financial assistance the applicable Federal financial
programs based on its government-wide OMB proposes to revise § 200.305 to assistance program, including
financial management authorities require Federal agencies to verify consideration of practicability and cost
discussed above. Although OMB is recipient eligibility through Treasury’s effectiveness. OMB also proposes
proposing to expand application of the Do Not Pay (DNP) system before making language to clarify that part 200 does
program, the requirements under the any disbursement of any Federal not prohibit recipients or subrecipients
program would otherwise apply in payment. Consistent with the Payment from communicating a requirement that
accordance with applicable Federal law Integrity Information Act of 20194 individuals be authorized to work in the
and DHS program requirements. For (PIIA),100 this addition is intended to United States under applicable law.
entities and activities to which the E- strengthen oversight and prevent OMB also proposes to clarify that
Verify participation program is applied, improper payments. recipients and subrecipients are also
Consistent with section 3 of Executive responsible for ensuring consistency
OMB does not propose to alter existing
Order 14222, ‘‘Implementing the with applicable law, and that
exceptions or limitations recognized in
President’s ‘Department of Government employment practices should be
DHS program requirements based on
Efficiency’ Cost Efficiency Initiative,’’ consistent with the foundational
DHS authorities. OMB also does not
OMB also proposes language that principles of recognizing merit and the
propose to apply the program to
requires payment requests from ability of employees to fulfill the
activities unrelated to Federal awards.
recipients and subrecipients other than requirements of the contract.
Consistent with the Immigration and
States to include justifications Collectively, these proposed revisions
Nationality Act (8 U.S.C. 1324a), which
describing the purpose of the payment streamline the requirements by
prohibits employers from knowingly
and the specific award-related work it removing extraneous, unnecessary, or
hiring or continuing to employ
supports. Under the proposed text, inappropriate examples, while
unauthorized aliens and requires
agencies must collect this information reinforcing lawful flexibility and cost
employers to verify employment
once appropriate systems are in place. accountability in procurement practices.
eligibility, this provision is intended to
These proposed changes would increase
strengthen compliance with Federal Section 200.320—Procurement Methods
accountability for Federal
employment eligibility requirements for OMB proposes to revise § 200.320 to
disbursements while ensuring funds are
individuals performing work under include language regarding how cost-
tied to measurable award activities and
Federal awards. reimbursement contracts may be used.
outcomes.
Lastly, OMB proposes to add The proposed language strongly
§ 200.303(g) to clarify that States must Section 200.306—Cost Sharing discourages recipients from using cost
conduct pre-payment verification OMB proposes to revise § 200.306 to reimbursement contracts. Under the
checks prior to disbursing Federal relocate paragraph (a) on voluntary proposed text, when using cost-
funds. Specifically, States that are committed cost sharing to paragraph (j). reimbursement contracts, the recipient
recipients of Federal financial assistance This policy fits better next to paragraph must notify the awarding Federal
must review available data sources with (k), which addresses voluntary agency of its use of this mechanism and
relevant information to verify the uncommitted cost sharing for maintain a written justification in its
eligibility of payees and prevent institutions of higher education (IHE). records. OMB also proposes flexibility
improper payments. Such reviews may for Federal agencies, at their discretion,
Section 200.318—General Procurement
be conducted through the Department of to require prior approval of such
Standards
the Treasury’s Do Not Pay (DNP) contracts in the terms and conditions of
system, or through an alternative OMB proposes to revise § 200.318 to the award. These changes are intended
payment screening process that strengthen accountability for time-and- to reflect that cost-reimbursement
provides protection against improper materials type contracts and to contracts are inherently higher risk, as
payments. This proposed revision streamline other procurement they reduce incentives for contractors to
would not require States to adopt requirements. The proposed revisions control costs, require more intensive
specific payment systems or add requirements that material costs oversight, and present greater risk of
technologies. The requirement to under time-and-materials contracts must improper or excessive payments of
conduct eligibility reviews for payees is be supported by documentation and Federal funds. By discouraging their use
not intended to substitute or replace any priced consistently with market rates. while preserving agency authority to
required program specific requirements. These additions are intended to ensure require prior approval, the revision
Consistent with the Payment Integrity recipients apply effective cost controls strikes a balance between limiting risk
Information Act of 2019 (31 U.S.C. and maintain transparency in contract and allowing flexibility in
3351–3356), which establishes pricing. OMB also proposes to revise circumstances where no other contract
government-wide requirements to this section by deleting a prior list of type is feasible.
prevent and reduce improper payments, examples of labor and employment
practices that do not reflect common Section 200.321—Contracting With
and the Do Not Pay Initiative under 31
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procurement approaches or otherwise Small Businesses
U.S.C. 3354, this provision is intended
to strengthen internal controls over do not align with administration policy OMB proposes to streamline § 200.321
Federal funds by requiring States, as or Federal agency priorities. The to simplify direct recipients and
recipients of Federal financial proposed text continues to recognize subrecipients to ensure that small
assistance, to review available data that recipients and subrecipients may businesses, including subcategories
use project labor agreements or other enumerated in Federal statute, are
99 Compare 48 CFR, Subpart 22.18. See also FAR types of pre-hire collective bargaining considered for contracting
Case 2007–013, Employment Eligibility opportunities. These proposed changes
Verification, 73 FR 67651 (Nov. 14, 2008). 100 31 U.S.C. 3351 et seq. are intended to streamline the policy,
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32224 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
reduce administrative burden, and of property or services referred to in version) does not exist under the
ensure that contracting preferences . . . [41 U.S.C.] 1121(c)(1) . . . by existing version of 2 CFR. OMB
remain consistent with law and other recipients of Federal grants or assistance proposes to find that establishing this
principles discussed in this document, under the programs.’’ That authority policy is legally available based on the
including merit-based opportunity. must be exercised with ‘‘due regard to discretion left to agencies for
applicable laws and the program implementation. Under the current 2
Section 200.322—Domestic Preferences
activities of the executive agencies CFR regulatory text, agencies only
for Procurements
administering Federal programs of impose mandatory Buy America
OMB proposes to revise § 200.322 to grants or assistance.’’ Id. requirements for infrastructure grants. If
clarify the policy related to domestic Consistent with the above authorities, statutory authority is determined to be
preferences for procurements under proposed paragraph (a) would only be available, and the agency determines
Federal awards. The text of § 200.322(c) required ‘‘to the greatest extent that imposing conditions would be
(existing version) refers to mandatory practicable and consistent with law.’’ practicable for the relevant program,
requirements at 2 CFR part 184 for Thus, agencies would be responsible for this newly proposed provision could
infrastructure awards. The text of evaluating both the practicability and require agencies to apply domestic
§ 200.322(a) and (b) (existing version) legal availability of imposing such manufacturing requirements for a
provides an aspirational standard that conditions. OMB is not directly broader range of grant activities.
applies more broadly to all awards. imposing this requirement on award
OMB proposes to delete the existing recipients, but requiring agencies to Section 200.323—Procurement of
aspirational standard at paragraphs (a) evaluate its practicability and the legal Recovered Materials
and (b) and replace it with a new authorities that apply to non- OMB proposes to remove § 200.323(b)
paragraph (a) (proposed version) infrastructure financial assistance in its entirety. The Executive order that
directing agencies, to the greatest extent programs. The agency discretion to provided the foundation for this policy
practicable and consistent with law, to evaluate ‘‘practicability’’ leaves was rescinded. Moreover, the policy
include terms and conditions in Federal considerable flexibility for was only an encouraged practice and
financial assistance awards to maximize implementation. In addition to not a requirement.
the use of goods, products, and evaluating practicability, agencies
materials produced in the United States. Section 200.324—Contract and Cost
would need to identify statutory
At paragraph (b) (proposed version), in Price
authority prior to imposing such
the case of infrastructure projects, OMB conditions. For example, some OMB proposes to streamline
proposes to preserve the existing authorizing statutes may broadly § 200.324, including removing an
requirement at paragraph (c) for authorize an agency to impose any example related to considering potential
agencies to implement the mandatory conditions that the agency head finds workforce impacts if a procurement
Buy America preferences set forth in 2 warranted, while others may narrowly transaction will displace public sector
CFR part 184. define the types of conditions that may employees. The proposed changes are
Based on the Build America, Buy be imposed. Generally, to impose not intended to prohibit the
America Act (BABA), which was substantive conditions on Federal consideration of such impacts, only to
included in the Infrastructure grants, an agency must identify statutory remove the example. This streamlined
Investment and Jobs Act (IIJA), OMB has authority providing the agency with text removes a potential burden on
broad statutory authority to require discretion to impose such conditions. recipients that is not statutorily
inclusion of mandatory Buy America As such, before imposing Buy America required.
requirements for all Federal award conditions on non-infrastructure
infrastructure assistance programs. OMB Section 200.329—Monitoring and
awards, agencies must evaluate their Reporting Program Performance
implemented these mandatory appropriations and authorizing statutes
standards for infrastructure at 2 CFR on a case-by-case basis to determine OMB proposes to revise § 200.329 to
part 184 and § 200.322(c) (existing whether they have the legal discretion require recipients to confirm in their
version). BABA is the most relevant to impose such conditions. The performance reports that all subawards
government-wide source of authority to proposed language would provide that, issued during a reporting period have
impose mandatory grant conditions on if agencies identify the necessary legal been reported to SAM.gov. This
non-Federal entities specifically related authority, and determine that imposing proposed addition is intended to
to Buy America requirements under conditions would be practicable under strengthen transparency and ensure
financial assistance awards. There are the relevant program, they must include subaward data is current and accurate.
also various agency-specific statutes that grant terms and conditions to maximize OMB also proposes a new paragraph (h)
do the same. domestic content. Unlike § 200.322(a)– to emphasize the importance of
The authority of Federal agencies to (b) (existing version), if a requirement is subrecipient reporting. Specially, OMB
impose domestic purchasing included in the terms and conditions of emphasizes that Federal agencies are
requirements for non-infrastructure an award, it could be made a legal responsible for providing oversight
awards will generally depend on requirement subject to audit instead of regarding subrecipient reporting, such
appropriations and authorizing statutes merely an aspirational standard. If such as reviewing and monitoring
for individual award programs. OMB, a requirement is included for a non- subrecipient reporting in SAM.gov, and
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through the Administrator of the Office infrastructure award, the agency would taking corrective actions when
of Federal Procurement Policy (OFPP), need to define the applicable Buy recipients are not in compliance.
also has authority under 41 U.S.C. 1125 America standard it is imposing, which In addition, in existing paragraph (g)
to ‘‘prescribe Government-wide policies, could be based on existing standards (proposed paragraph (i)), OMB proposes
regulations, procedures, and forms that required by law in other contexts, such to require Federal agencies to justify and
the Administrator considers appropriate as the BABA standard in part 184 or maintain documentation of any decision
and that executive agencies shall follow others. to waive any performance report. This
in providing for the procurement, to the OMB recognizes that the proposed proposed revision balances
extent required under those programs, policy at paragraph (a) (proposed accountability with flexibility,
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Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules 32225
reinforcing oversight of performances, undermine public trust in Federal causes of action and civil remedies, and
including subrecipient reporting, while award programs. decisions regarding the extent of any
allowing agencies to reduce unnecessary cooperation, will be made solely in the
Section 200.333—Fixed Amount
reporting burdens where appropriate. discretion of that agency. The proposed
Subawards
Lastly, OMB proposes a new subsection (b) is not intended to, and
paragraph (e) regarding performance OMB proposes to revise § 200.333 to would not, create any right or benefit,
reports for scientific research. For remove the policy allowing recipients to substantive or procedural, enforceable at
awards categorized by a Federal agency issue fixed amount subawards. Fixed law or in equity by any party against the
in accordance with § 200.202(f), the amount subawards have been United States, its departments, agencies,
recipient must identify and include the implemented inconsistently across or entities, its officers, employees, or
categorization provided in the terms and programs, agencies, and recipients, and agents, or any other person. Nothing in
conditions of the award in the existing standards for this type of award the proposed subsection (b) should be
performance report. do not provide for transparency, construed to impair or otherwise affect
accountability, and oversight as the authority granted by law to an
Section 200.331—Subrecipient and compared to other award types. OMB executive department or agency, or the
Contractor Determinations proposes to eliminate fixed amount head thereof. A Federal agency should
OMB proposes to revise § 200.331 by subawards consistent with the changes only cooperate with a private cause of
adding a new paragraph (c). This made to § 200.201. action if it determines that such
paragraph addresses transfers of Federal Section 200.336—Methods for cooperation is in the interest of the
funds to related entities. This proposed Collection, Transmission, and Storage of United States
addition makes clarifies that pass- Information Section 200.340—Termination and
through entities cannot treat such Suspension
OMB proposes to revise § 200.336 by
transfers as internal allocations exempt
adding a statement encouraging
from a determination required by this 1.a. Summary of proposed revisions
recipients and subrecipients to use
section. Instead, consistent with the regarding termination. OMB proposes to
domestic storage capabilities for
requirements of this section, related revise § 200.340(a) to provide additional
electronic records. This addition is
entity transactions must be reviewed clarity regarding reasons available to
intended to strengthen data security,
and classified as either a subaward or Federal agencies for discretionary
reduce exposure to potential foreign
contract. This would ensure terminations of Federal awards, and also
data vulnerabilities, and support greater
accountability and transparency in to add new provisions regarding
assurance that Federal award records
circumstances involving related parties temporary suspension of Federal
remain accessible and protected within
and prevent circumvention of Federal awards. These proposals are similar to
U.S. jurisdiction. While framed as a
reporting requirements. parallel procedures for procurement
strong encouragement rather than a
mandate, this change promotes best contracts under the FAR. The proposed
Section 200.332—Requirements for
practices for safeguarding sensitive revisions regarding discretionary
Pass-Through Entities
Federal award information. termination are also consistent with
OMB proposes to revise § 200.332 to section 5(a) of Executive Order 14332 of
add three new paragraphs to this Section 200.338—Restrictions on Public Aug. 7, 2025, ‘‘Improving Oversight of
section. In proposed paragraph (g), OMB Access to Records Federal Grantmaking,’’ which instructs
again highlights the requirement that OMB proposes a clarification to OMB to revise 2 CFR to further clarify
pass-through entities must report § 200.338. Specifically, confidential and require all discretionary grants to
subawards to SAM.gov in accordance business information is included as a permit termination for discretionary
with the requirements of 2 CFR part type of information that Federal reasons, ‘‘including when the award no
170. In proposed paragraph (h), OMB agencies may not place restrictions on longer advances [Federal] agency
reiterates the requirement in § 200.331 the recipient or subrecipient from priorities or the national interest, but
that pass-through entities must make limiting public access to such subject to appropriate exceptions,’’
subrecipient and contractor information. including certain exceptions set forth in
determinations for all downstream the Executive Order.
entities, including affiliates, Section 200.339—Remedies for
In developing the proposed rule, OMB
subsidiaries, and related organizations. Noncompliance
considered alternatives to the
This proposed change would clarify that OMB proposes to add a new discretionary termination provision,
internal organization affiliations do not paragraph to § 200.339 to clarify that, if such as stricter up-front screening
exempt pass-through entities from applicable and consistent with law, a during the award selection process or
classifying subawards and contracts. Federal agency may, at its discretion, enhanced monitoring. While these are
Lastly, in proposed paragraph (i), OMB cooperate with individuals or also important tools to ensure oversight
specifies that pass-through entities must organizations in pursuing their own of the Federal grantmaking process,
ensure that subrecipients do not take private cause of action or remedies. This OMB found that they do not remove the
actions that could significantly damage addition would not impose an need for mid-award termination
the reputation of the pass-through affirmative duty on agencies to assist in mechanism. The discretionary
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entity, awarding Federal agency, or the private litigation. The proposed revision termination provision is similar to the
Federal Government. Where such is only intended to affirm that agencies already existing authority at
actions occur, the proposed text may, at their discretion, cooperate with § 200.340(a)(4) in the 2024 regulatory
indicates that the pass-through entity persons in pursuit of private remedies text and § 200.340(a)(2) in the 2020
must consult with the Federal agency to in circumstances consistent with law. regulatory text.101
determine whether termination of the For the avoidance of doubt, the
award is warranted. This proposed decision of whether an agency will 101 The operable language regarding ‘‘program
addition would ensure accountability cooperate with individuals or goals or agency priorities’’ was first established by
for reputational risk that may organizations in their pursuit of private OMB in 2020 at § 200.340(a)(2) (2020 version).
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32226 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
By preserving the policy flexibility those of the Federal agency that is generally have similar and broadly
provided to agencies from Congress for politically accountable at the national overlapping meanings, but agencies may
discretionary award programs through level for implementing the Federal include this or other additional reasons
clear upfront notice to recipients, program under which the award was for discretionary terminations if useful
agencies can best ensure the responsible made. In some situations, pass-through for clarity or avoidance of doubt.
management and safeguarding of entities may interpret the term ‘‘agency Other clarifying edits are proposed in
taxpayer resources throughout the priorities’’ under the existing provision paragraph (a) regarding the other
award lifecycle. Federal agencies—and to include State or local government reasons for termination, including for
ultimately, the American taxpayer— priorities, which may be inconsistent or noncompliance, by mutual agreement,
should not remain obligated to continue even conflict with Federal priorities or upon notification by the recipient or
funding discretionary awards that do the national interest. To clarify intent, subrecipient, and pursuant to additional
not best or most effectively serve the OMB proposes to add the word terms and conditions included in the
authorized public purposes of the ‘‘Federal’’ before ‘‘agency priorities.’’ In Federal award. For readability, sub-
particular program. the final rule, OMB is also considering headings are added for all authorized
The benefits of this proposal include others revisions to clarify this point. reasons for termination. In the
increased flexibility for agencies to The interest of a pass-through entity in noncompliance paragraph, OMB
respond to changing circumstances, implementing a Federal award should proposes to mention that failure of the
priorities, or knowledge. By aligning remain consistent with the interest of recipient to report subawards on
grant management with well-established the Federal agency responsible for SAM.gov pursuant to the award term
contract management practices, the implementing the Federal program on required by part 170 can constitute
Federal Government can ensure greater the national level. If this is not grounds for termination for
and more responsible oversight adequately clear or implied under the noncompliance. Under the final
regarding how taxpayer resources are proposed text, OMB may consider paragraph for ‘‘additional terms and
used and managed. revising the proposed standard in the conditions,’’ OMB also proposes to
Like the 2020 version, and as final rule from ‘‘in the interest of the recognize that Federal agencies may
remained permitted under the 2024 Federal agency or pass-through entity’’ only include terms and conditions that
version, the proposed version of to only include ‘‘in the interest of the are permitted by law. For example, as
§ 200.340 expressly contemplates that Federal agency.’’ In any case, with termination for discretionary
sometimes Federal agency program terminations by pass-through entities reasons, certain non-discretionary
goals or priorities may change after an should remain consistent with the programs may not permit expanded
award is initially made, or that the interest of the Federal agency, which is termination provisions based on agency
Federal agency may reassess whether a responsible for setting program goals discretion.
particular recipient remains the best and priorities for the Federal program. Paragraph (b)(1) of the proposed text
available choice to achieve the public A termination by a pass-through entity provides that, to the extent authorized
purposes authorized by law on behalf of should not conflict with the Federal by law, and except as provided in
the American taxpayer. Like the earlier interest. In some cases, it may be paragraph (b)(2), the Federal agency and
versions, the proposed text also appropriate for a pass-through entity to pass-through entity must ensure that all
recognizes that sometimes program coordinate with a Federal agency before Federal awards allow termination for
goals or Federal agency priorities may making such a discretionary termination the reasons described in paragraphs
change in response to new direction under this provision. (a)(1) through (4) of the section. The
from politically accountable leadership. Like the 2020 provision, the proposal proposed paragraph (b)(2) explains
As is already the case, the proposed recognizes that Federal agency priorities exceptions to this requirement.
version of 200.340 contemplates that an may change after an award is initially Specifically, the requirement to include
agency may exercise those types of made. This proposal creates greater the discretionary termination provision
discretion as a responsible steward of alignment between Federal financial does not apply to any Federal award in
public resources. assistance and the long-standing which inclusion of such a discretionary
Accordingly, OMB proposes to add termination for convenience provision termination provision would conflict
the updated discretionary termination applicable to Federal procurement with a Federal statute. Consistent with
provision, which further clarifies the contracts. The goals of this proposal the distinction recognized in Executive
government-wide authority already include ensuring that Federal funds are Order 14332 between discretionary
available to agencies under not wasted, projects remain aligned awards and statutory entitlements, the
§ 200.340(a)(4) (existing 2024 version). with Federal agency priorities, and proposed text explains that the
OMB proposes the new discretionary recipients remain accountable for discretionary termination ‘‘provision is
termination provision to provide that delivering projects consistent with generally applicable to discretionary
the Federal agency or pass-through public purposes authorized by law. awards, but not to Federal awards made
entity, to the extent permitted by law, OMB does not intend the proposed under programs where legislation
may terminate a Federal award in part list of reasons for discretionary establishes an entitlement to the funds
or its entirety if the Federal agency or terminations to necessarily be on the part of the recipient, such as
pass-through entity determines that a exhaustive. If the rule is finalized, block grants, those awarded based on a
termination is in the interest of the Federal agencies must include all of the statutory formula, or disaster recovery
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Federal agency or pass-through entity. listed reasons, but may also include grants.’’ Statutory entitlements are the
The proposed regulation specifies that supplemental reasons, as appropriate, only categorical exception recognized in
this includes if a Federal award no based on the authority at § 200.340(a)(5). the proposed rule, but certain other
longer effectuates program goals, For example, agencies may also specify statutory requirements imposed on
Federal agency priorities, or the national that discretionary terminations may Federal agencies related to obligation or
interest as they exist at the time of the occur in circumstances in which a use of Federal funds may also impose
termination. Federal award is no longer in the limits on the application of this
OMB proposes to clarify that the ‘‘public interest.’’ The ‘‘public interest’’ provision in some circumstances.
relevant ‘‘agency priorities’’ would be and the ‘‘national interest’’ should Consistent with Executive Order 14332,
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the discretionary termination provision necessary resources available to provide evolve, and facts and circumstances
also ‘‘does not apply to agreements effective monitoring and oversight of may change in ways that were not
entered into in furtherance of Federal awards. Temporary suspensions anticipated by the Federal agency at the
international trade agreements or those of activities are sometimes necessary to time the award was initially made.
awarded by the Department of protect the Federal interest, but may Provided that the Federal agency
Commerce under title XCIX of the also potentially create administrative or provides clear notice of the
William M. (Mac) Thornberry National financial challenges for recipients. The discretionary termination provision to
Defense Authorization Act for Fiscal proposed policy requires agencies to recipients at the time the award is made,
Year 2021 (Pub. L. 116–283), the CHIPS account for the potential budgetary and which will allow recipients to
Act of 2022 (Pub. L. 117–167), or scheduling impacts and seeks to appropriately calibrate and manage
division F of the Infrastructure maintain fairness and transparency in reliance interests, it is appropriate for
Investment and Jobs Act (Pub. L. 117– managing such disruptions. As a result, Federal agencies, and the Executive
58).’’ the proposed revisions would promote Branch more broadly, to retain the
The proposed paragraph (b)(2) also communication and accountability policy flexibility to terminate awards
explains that if questions arise regarding between agencies and recipients in the that are no longer in the Federal
applicability of the discretionary event of temporary suspensions. They Government’s interest. Federal agencies
termination provision to specific would also support more effective should not be forced to continue
programs or awards, Federal agencies program oversight and minimize the funding projects that do not best serve
are strongly encouraged to consult with risk of extended downtime or program goals, Federal agency priorities,
OMB. Federal agencies must seek misaligned expectations following a or the public interest more broadly. The
approval from OMB prior to allowing work stoppage. suspension provides similar flexibility
any class exceptions not otherwise Proposed paragraph (b)(4) addresses for temporary stoppages.
required by statute or recognized in the circumstances in which temporary 3. Similar existing authority
paragraph (b)(2). suspensions provisions must be applicable to Federal contracts. In the
Thus, with limited exceptions, the included in the terms and conditions of Federal procurement context, executive
proposed text requires inclusion of four a Federal award. Similar to the agencies have long included termination
standard reasons for termination, discretionary termination provision, the for convenience clauses in contracts.
including the discretionary termination Federal agency or pass-through entity The Federal Acquisition Regulation
provision, in all Federal awards, rather must clearly and unambiguously (FAR) permits an agency to terminate a
than a ‘‘pick and choose’’ approach include the suspension provision in the contract ‘‘for convenience’’ whenever it
among the available options. The terms and conditions of the Federal determines that termination is in the
existing provision has sometimes led to award unless doing so would conflict government’s interest. See, for example,
inconsistent termination provisions with a Federal statute. The proposed 48 CFR 49.502 and 52.249–2. This
across the Federal Government and text explains that the suspension longstanding tool allows Federal
confusion regarding which termination provision is generally applicable to agencies to terminate contractual
provisions actually are or should be discretionary awards, but not to Federal obligations that have become
included in specific Federal awards. awards made under programs where unnecessary or contrary to new policy
The proposed revisions emphasize, at legislation establishes an entitlement to direction, while allowing appropriate
paragraph (b)(1), that the Federal agency the funds on the part of the recipient, cost recovery for work already
is always required to include the four such as block grants, those awarded performed. Federal courts have upheld
standard termination provisions unless based on a statutory formula, or disaster these terminations as a legitimate means
an exception applies. recovery grants. If questions arise of preserving flexibility to protect
In addition to the four standard regarding applicability of the taxpayer resources and respond to
termination provisions, OMB also suspension provision to specific Federal changing circumstances.
proposes adding a fifth potential reason programs or types of Federal awards, By applying a parallel principle to
for termination, allowing a Federal Federal agencies are also strongly discretionary assistance programs, such
agency or pass-through to define encouraged to consult with OMB. as discretionary grants and cooperative
additional grounds for termination in 2. Need for policy flexibility and agreements, the proposed rule further
the terms and conditions of the Federal ongoing stewardship of Federal funds. harmonizes Federal grant management
award, providing that doing so is Consistent with the first objective of this with longstanding procurement
consistent with authorizing law. OMB rulemaking, the proposed discretionary practices, while also tailoring the
proposes certain clarifying edits and to termination and suspension provisions provision for use under OMB’s
add subsection headers for clarity. provide essential tools for ensuring requirements in 2 CFR. A 2020 revision
1.b. Summary of proposed revisions ongoing stewardship and responsible of the Uniform Guidance already
regarding temporary suspension. OMB management and oversight by Federal introduced a comparable basis for
proposes to add a new paragraph (d) agencies of taxpayer resources termination ‘‘if an award no longer
regarding temporary suspension of throughout the award lifecycle. The effectuates program goals or agency
awards. Similar to a parallel provision discretionary termination provision priorities.’’ This proposed revision will
in the FAR applicable to procurement preserves policy flexibility, consistent ensure that Federal agencies have broad
contracts, this paragraph would provide with law, for an agency to reconsider authority for termination for
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Federal agencies and pass-through whether a particular Federal award discretionary reasons that is similar to
entities with authority to provide a effectively serves the Federal the authority under the FAR in purpose
written order to stop work. The Government’s interest in carrying out and general effect, while also
proposed revisions address the contents public purposes or objectives authorized accounting for the unique context of
of such orders and how they must be by law. Agency program goals and grants.
handled by the Federal agency or pass- priorities related to such public The proposed provision is necessary
through entity. These revisions are purposes may evolve over time, the to safeguard the ability of executive
intended to ensure that Federal agencies agency’s best judgment regarding the agencies to supervise executive branch
and pass-through entities have all the national interest may also change and spending. The Federal Government’s
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32228 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
responsibility for stewardship of Order 14332. Similar limitations are statute does not limit or control the
taxpayer funds does not diminish provided for the proposed suspension process for terminations or
merely because the award is a grant and provision. reconsideration of award decisions,
not a contract. If a project funded by a Consistent with the termination these provisions can be applied by
grant is failing to meet underlying provisions in 2020 and 2024, the agencies in a manner consistent with
public purposes, program objectives, proposed discretionary termination their authority under law. For programs
Federal agency priorities, or the national provision continues to recognize that in which an agency has lawful
interest, the government should have a Federal agencies cannot terminate discretion to make an award, the
comparable ability to discontinue grants when doing so would be discretionary termination and
funding as it would for a similarly inconsistent with a Federal statute. The suspension provisions provide clear
misaligned contract. The proposed rule legality of any particular grant notice to recipients that the agency
generalizes this best practice across the termination will necessarily turn on the retains the discretion to withdraw,
Federal Government, ensuring specific Federal statutes governing the terminate, or temporarily suspend that
consistency and transparency. agency program at issue, and various award consistent with law.
Similarly, executive agencies have other award-specific, agency-specific, The proposed discretionary
also long included clauses in contracts and other considerations that can only termination and suspension provisions
allowing for temporary work stoppages be decided by a court at a more granular merely ensure that the government
or suspensions. The FAR permits an level. The OMB discretionary retains appropriate authority to course
agency to, at any time, by written order termination provision merely creates the correct, consistent with the discretion
to the contractor, require the contractor legal framework for terminations when provided by law, if circumstances
to stop all, or any part, of the work otherwise consistent with law. A warrant. These provisions are an
called for by the contract for a period of framework that only permits important safeguard, providing policy
90 days after the order is delivered to terminations to the extent consistent flexibility if an agency determines that
the contractor, and for any further with law does not conflict with any a project is contrary to the Federal
period to which the parties may agree. statute. To the extent a grant recipient interest, or that a work stoppage is
See, for example, 48 CFR 42.1303 and believes that a particular termination is necessary for reasons including
52.242–15. This longstanding tool unlawful, it could raise that concern in evaluating whether a project is aligned
allows Federal agencies to temporarily the U.S. Court of Federal Claims. with the Federal interest.
suspend contractual obligations to For discretionary award programs, to Similar analysis regarding executive
ensure effective oversight and which the proposed discretionary authority for discretionary award
accountability and for other purposes. termination and suspension provisions programs applies to both the
4. Executive authority applicable to will apply, Congress has generally discretionary termination and
discretionary award programs. For provided Federal agencies with broad temporary suspension provisions. To
discretionary award programs, the discretion to determine how to select limit repetition in the preamble for this
proposed discretionary termination and recipients and administer awards to proposed rule, OMB does not recite the
suspension provisions operate within serve public purposes recognized in basis for that authority separately, but
the framework of Congressional law. Certain legislative boundaries proposes to find that the same general
authorization and appropriation. frequently apply to agency authority principles apply.
Congress provides agencies with under those programs, such as statutory OMB and the participating agencies
discretionary authority to make awards requirements related to eligible rely on this discretionary authority,
for certain program purposes, leaving recipients, projects, or activities. The where it applies, for the proposed
agencies with broad discretion as to authority to make discretionary awards discretionary termination and
which projects to fund. The within those boundaries, however, suspension provisions, in addition to
discretionary termination and necessarily includes the ability to revisit OMB’s authorities for government-wide
suspension provisions are merely an earlier decisions and re-exercise agency grants management. The proposed
exercise of that discretionary judgment in light of changing discretionary termination and
authority—allowing agencies, consistent circumstances, at least provided that: (i) suspension provisions are a legitimate
with law, to retain discretion regarding the particular program statute does not and reasonable exercise of the authority
how Federal funds are expended in expressly limit or control the agency’s for discretionary grant programs
service of the program’s objectives. The discretion to reconsider its earlier award provided to executive agencies.
proposed provisions do not contravene determinations; and (ii) the recipient 5. Spending clause framework. The
statutory requirements or otherwise receives clear and unambiguous notice Spending Clause framework discussed
assert any authority for discretionary of the discretionary termination above regarding proposed revision to
programs that is not already provided to provision in the award instrument. § 200.300 does not directly apply to the
agencies in the statutes authorizing The statutory authority provided by proposed revisions to § 200.340
those programs. Congress allowing executive agencies to regrading termination and suspension.
To recognize these limits, the text of administer discretionary award The discretionary termination and
the discretionary termination provision programs—including deciding which suspension provisions are merely
recognizes that it may only be exercised entities receive awards and the amount administrative features of the OMB
‘‘to the maximum extent authorized by of those awards—necessarily includes requirements for grants administration
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law.’’ If a particular program statute the implied or inherent authority for that, where applicable, preserve
expressly entitles a recipient to certain agencies to reconsider earlier decisions discretionary authority provided to
funding or expressly prohibits made about awards. Provided that clear agencies by Congress throughout the
termination in certain circumstances, and timely notice of the discretionary award lifecycle. The discretionary
those statutory limits would control. termination and suspension provisions termination and suspension provisions
These statutory limits are also is included by the Federal agency in the are not substantive conditions imposed
recognized in the proposed exception award instrument—either at the time of on particular awards in exchange for
paragraph, which corresponds with award or through an amendment made Federal funds. But even if the Spending
language in section 5(a) of Executive consistent with law—and that a program Clause framework were found to apply
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to the proposed revisions to § 200.340, right to terminate an award that an the discretionary termination or
it does not present an obstacle to agency determines is no longer in the suspension provisions do not apply, and
including this term. See Dole, 483 U.S., Federal interest as it relates to for which the agency does not have
at 207–11. underlying program objectives. This comparable discretionary authority,
First, as discussed above, the right is rooted in the established legal such as entitlement programs.
determination of Congress to provide authority of OMB and agencies to 6. Termination costs. OMB has
agencies with discretionary authority to establish conditions related to grants carefully considered reliance interests
administer award programs promotes administration and the efficient use of that may be implicated by the proposed
the general welfare. For example, this Federal funds for authorized purposes. discretionary termination provision.
discretionary authority ensures that As such, it is also inherently related to Three features of the proposed rule are
programs are administered in a way that the effective administration of the designed to address these concerns: (1)
protects taxpayer resources, is Federal interest in particular the clear and unambiguous notice of
responsive to the needs Americans discretionary award programs. Building discretionary termination provision
within legislative bounds, and provides on the existing discretionary discussed above; (2) compensation for
ongoing stewardship and oversight of termination provision, the revised work performed consistent with existing
Federal funds throughout the award version would be an important tool to termination procedures and cost
lifecycle. The general welfare is served ensure that Federal awards continue to principles; and (3) procedures related to
by allowing the Federal Government to be used in furtherance of programs notices of a discretionary termination,
discontinue funding for projects that goals, Federal agency priorities, and the an opportunity for recipients to explain
prove ineffective or harmful, and to national interest as it relates to the terminations costs, and case-by-case
appropriately allocate resources to particular program. The condition helps discretion for agencies to consider
projects that would better serve the to reinforce the relatedness of additional terminations costs and weigh
public good. The general welfare is also government spending to authorized them against competing policy
served by allowing temporary public purposes throughout the award concerns.
suspensions as appropriate in the lifecycle. If an awarded project, in the The proposal generally preserves
discretion of the awarding agency. agency’s judgment, ceases to be an existing post-termination procedures
Second, the proposed discretionary effective use of government resources in and cost principles, but includes
termination and suspension provisions achieving those purposes, the agency additional clarifying text applicable to
are designed to provide clear, may discontinue funding. Similar discretionary terminations. Generally,
unambiguous, and timely notice of the analysis applies to the suspension when a grant is terminated, grant
award condition to applicants and provision, which further ensures that recipients are entitled to reimbursement
recipients before the Federal award is the Federal agency retains effective for all allowable costs incurred up to the
made. This will provide up-front oversight tools throughout the award effective date of termination. This
transparency regarding the process for lifecycle. ensures that a recipient will not be left
terminating or suspending awards for Fourth, the discretionary termination uncompensated for legitimate expenses
discretionary reasons. Applicants and and suspension provisions are merely made in reliance on the award prior to
recipients will enter into awards with extensions of a Federal agency’s general the effective date of the termination.
full knowledge of the risks and authority to exercise discretion over The proposed rule also clarifies notice
conditions associated with accepting the Federal award programs consistent with requirements for terminations and
Federal award. This clear notice will law. The discretionary termination and provides agencies with case-by-case
permit them to make informed decisions suspension provisions preserve the right discretion to consider costs associated
regarding acceptance of Federal awards for agencies to retain and exercise with a terminated award and weigh
and appropriately mitigate reliance ongoing discretion over how Federal them appropriately against competing
concerns. By agreeing to the award funds are used to serve statutory policy concerns. While not identical,
conditions, recipients accept the risk of purposes. This aligns with discretion this structure has certain similarities to
an early termination or temporary long exercised by Federal agencies in the treatment of termination costs in
suspension, which satisfies the clear the context of Federal contracting. Like Federal contracts, where contractors
notice standard under relevant case law. the parallel FAR provisions, the terminated for convenience can recover
If a recipient is unaware of the discretionary termination and costs for completed work and
discretionary termination or suspension suspension provisions are just a reasonable termination expenses.
provisions included in its award, the procedural or mechanical features of the Compare 48 CFR 52.249–2. By ensuring
only explanation will be its failure to regulation that do not directly signal that recipients can submit information
read the government-wide regulations, that any specific termination or related to termination costs, the rule
the award instrument, or both. suspension will occur or otherwise provides appropriate discretion to
Third, the exercise of agency induce unconstitutional conduct. agencies to consider and respond to
discretion in general for discretionary Finally, the proposed discretionary these concerns upon award termination.
awards, and the discretionary termination and suspension provisions The proposed provisions balance the
termination provision in particular, are are not unduly coercive. Again, these need for Federal flexibility with fairness
inherently related to the ‘‘federal are just procedural or mechanical to recipients. Additional discussion
interest’’ in particular assistance features of the regulation corresponding regarding termination costs is provided
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programs for discretionary awards. The to similar FAR provisions. The proposal in this document under §§ 200.341 and
provision seeks to ensure that Federal extends the discretionary authority 200.343.
agencies have and retain the ability to provided to agencies by Congress
exercise judgment in determining how further into the award lifecycle. An Section 200.341—Notification of
discretionary funds are best used to applicant or prospective recipient Termination Requirement
serve the Federal Government’s interest remains free to opt out of particular At § 200.341(b), OMB proposes to
in the public purposes authorized by Federal award or program if it finds the provide additional information
law for particular programs. It is a provisions unacceptable. Such decision regarding notifications of terminations
procedural term providing the agency a would not affect other awards to which for noncompliance.
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At § 200.341(c), OMB proposes to add additional financial obligations, and, to would not be required for other types of
a paragraph regarding notifications of the extent authorized by law, terminate terminations unless expressly required
discretionary terminations. While the all subawards and contracts related to by other law. Such administrative
proposed discretionary termination the terminated portion of the Federal procedures—which are generally
provision reserves broad authority for award. The notification must also intended to allow a Federal agency to
terminations that are in the interest of provide an opportunity for the recipient make findings of fact and conclusions of
the Federal Government (or pass- or subrecipient to submit a brief written law related to a recipient’s alleged
through entity, as applicable), that statement regarding any termination misconduct or noncompliance under a
authority is not unlimited. As with all costs it believes are relevant. Federal award—would have less
exercise of agency discretion, Federal The proposed provision at purpose or need for terminations based
agencies (or pass-through entity, as § 200.341(d)(1), which is cross- on the discretionary reasons of the
applicable) must provide a reason for referenced at the discretionary Federal agency. For example, recipients
individual termination decisions, which termination provision at § 200.340(a)(2), would not generally be in the best
may serve as part of the administrative is intended to ensure that agencies position to present facts or information
record upon judicial review, if provide a reasoned explanation, related to the agency’s priorities as they
applicable. To ensure such reasons will consistent with law, for specific exist at the time the termination
be provided, at § 200.341(c), OMB termination decisions. For example, the decision is made. Moreover, unlike
proposes to expressly require Federal agency may explain why it compliance-based terminations,
termination notices issued under the determined that a particular award or discretionary terminations would not
discretionary termination provision to class of awards would no longer require reporting in SAM.gov
include a brief summary of the reason effectuate program goals, Federal agency (§ 200.340(c) (proposed version)), which
or reasons why an agency decided to priorities, or the national interest. Or the is an important reason for the
terminate an award or class of awards. Federal agency may prove an administrative hearing rights provided
That summary would not be required to explanation of why an award or class of to recipients for compliance-based
provide a detailed or exhaustive awards no longer best serves the terminations.
analysis, but only to ensure that the authorized public purposes of the In the case of discretionary
recipient or subrecipient is provided relevant program. Or an agency may terminations or suspensions, Federal
information regarding the reason for explain, more generally, why it agencies would be required to follow
termination. The summary should do determined that an award or class of other procedures described in the
more than merely citing the awards is no longer in the public regulatory text, including procedures
discretionary termination provision; it interest, or will no longer best serve the related to notice and allowable costs. An
should provide a reason why the public interest, as it relates to relevant agency, in its discretion, may elect to
termination was found to be interest of program objectives in statute. Or an engage with recipients through some
the Federal agency or pass-through agency may explain why reallocating form of administrative review process
entity. Ensuring the adequacy of the funds from an award or class of awards before or after a discretionary
notification will help to ensure that to other existing or new awards would termination or suspension, but would
recipients understand why termination better serve the public purpose of the not be required to except as necessary
decisions have been made and reduce program set forth in statute. Or any to provide notice, determine allowable
risk to the Federal Government. agency explanation may include some costs, and implement other sections of
Thus, the decision to terminate a combination of the above reasons or the regulatory text. In some cases,
Federal award for discretionary reasons other alternative reasons, consistent engaging with recipients on
under § 200.340(a)(2) (proposed version) with law, for why it decided that discretionary terminations or
would still require a basic rationale terminating the award was in the suspensions may serve to reduce risk to
regarding why the Federal award does government’s interest. the Federal Government or minimize
not effectuate program goals, Federal The proposed provisions at impacts to Federal programs or Federal
agency priorities, or the national interest § 200.341(c)—and additional proposed awards, while in other cases the agency
as they exist at the time of the revisions at § 200.343(b)—will allow may decide to limit engagement to only
termination. As in the context of agencies to consider what terminations required procedures, such as providing
parallel terminations for convenience in are warranted under the circumstances. appropriate notice and making a
the context of Federal procurement, This will include weighting determination of allowable costs.
provided that recipient was given circumstances that may warrant
Section 200.343—Effects of Suspension
upfront notice of the discretionary allowing the recipient to incur
and Termination
termination provision, the requirement additional termination costs after the
to provide a reason for award notice against competing policy At § 200.343(a), OMB proposes to
termination is not an exceptionally high concerns such as responsible provide further clarity regarding the
bar. By providing a reasoned stewardship of Federal funds and allowability of costs during suspension
explanation for the exercise of authority effective delivery of statutory objectives. or after termination. For costs resulting
under the discretionary termination from financial obligations properly
Section 200.342—Opportunities To incurred by the recipient or subrecipient
provision based on programmatic or
Object, Hearings, and Appeals before the effective date of suspension
policy reasons, as they exist at the time
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of the termination, agencies will remain OMB only proposes minor clarifying or termination, and not in anticipation
accountable for review in the U.S. Court revisions to § 200.342. Like the existing of it, the existing regulation provides
of Federal Claims, as appropriate and version of § 200.342, the proposed that allowability should be evaluated
authorized by law, for their termination version would continue to require based on whether the costs would be
decisions. Federal agencies to provide allowable if the Federal award was not
The proposed revisions also specify administrative hearing rights upon suspended or expired normally at the
that the notification must include initiating a remedy for noncompliance. end of the period of performance in
instructions to the recipient or As under the existing version, such which the termination takes effect. OMB
subrecipient to stop work, make no administrative hearing procedures proposes to clarify that the recipient or
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subrecipient must make all reasonable Section 200.421—Advertising and related to a specific Federal award.
efforts to discontinue, cancel, mitigate, Public Relations OMB also proposes to strike Councils of
or otherwise reduce such financial OMB proposes to revise § 200.421 to Government (COGs) from the existing
obligations and provides documentation specify that all advertising and public paragraph (b) (proposed paragraph (c))
of those efforts to the Federal agency relations costs are unallowable with to align this section with other proposed
upon request. Sometimes it may not be limited exceptions. The only exception policies.
possible to discontinue or cancel for public relations costs are those Section 200.450—Lobbying
properly incurred financial obligations, required by statute. Advertising costs
but the regulatory text should better OMB proposes to revise § 200.450 to
are allowable if required by statute or if
reflect the actual policy on such costs consolidate references to OMB
they are for the procurement of goods
provided in the cost principles under memoranda. OMB also proposes to add
and services for the Federal award; the
subpart E. OMB also proposes to three new paragraphs under this
disposal of certain scrap or surplus
include an express cross-reference to the section. Paragraph (c)(1)(iii) would
materials; or program outreach and
policy on termination and standard other specific purposes necessary to expressly prohibit funding any voter
closeout costs provided in the cost meet the Federal award requirements. registration campaigns, drives, or
principles at § 200.472(a). The existing These proposed revisions would clarify related activities under Federal awards.
version of OMB’s policy in that section Paragraph (c)(1)(iv) would prohibit
that advertising and public relations
already provides that recipients and using Federal funds to engage in issue
costs that do not benefit the Federal
subrecipients must make all reasonable advocacy or public messaging that
award are not allowable.
efforts to discontinue costs immediately promotes or opposes a particular social,
after the effective termination date. Section 200.429—Commencement and political, or public policy position
At § 200.343(c), to ensure that Federal Convocation Costs unrelated to the statutory objectives or
agencies are appropriately empowered OMB proposes to revise § 200.429 to performance requirements of the
to consider costs resulting from remove the reference to IHEs. OMB Federal award, including messaging
discretionary terminations, OMB also proposes that the restriction should designed to influence public attitudes
proposes to add a provision expressly apply to all entities and not only IHEs. on matters not necessary to accomplish
addressing such costs. The proposed This proposed change is intended to the purpose of the Federal award. The
paragraph would expand on the existing ensure that the cost principles are authority for this change is similar to
standard for which costs agencies may streamlined and apply fairly to all entity other provisions discussed above, which
allow, in their discretion and consistent types. are focused on aligning use of Federal
with law, following a termination award funds with core authorized
Section 200.432—Conferences purposes only, not extraneous activities
notice. The proposed notice provision at
§ 200.341(c) also instructs agencies to OMB proposes to expand § 200.432 to on divisive policy matters or issue
provide the recipient of the terminated add a requirement that costs for advocacy.
award with an opportunity to provide attending conferences are allowable Paragraph (c)(1)(v) would prohibit
information related to terminations only if participation in the conference is using Federal funds to influence the
costs. expressly approved by the agency and executive branch of any State
included in the terms and conditions of government on matters unrelated to the
Subpart E—Cost Principles the award. The revision would clarify objectives or performance requirements
Section 200.400—Policy Guide that recipients are not authorized to of the Federal award, including attempts
attend conferences using Federal funds to affect State agency policymaking,
OMB proposes to revise § 200.400 to rulemaking, or administrative actions
that do not serve to advance program
clarify in paragraph (e) that the for purposes other than carrying out
outcomes.
restrictions proposed in §§ 200.413 objectives of the Federal award.
through 200.414 must be considered Section 200.438—Entertainment and
where wide variations exist in the Prizes Section 200.454—Memberships,
treatment of costs. In addition, OMB Subscriptions, and Professional Activity
OMB proposes to revise § 200.438 to
proposes to remove the reference to Costs
remove reference to an outdated OMB
fixed amount awards for reasons memorandum. OMB proposes to revise § 200.454 to
discussed elsewhere in this document. clarify that the only allowable costs
Section 200.442—Fundraising and under this section are those necessary to
Section 200.401—Application Investment Management Costs fulfill the award requirements. OMB
OMB proposes to revise § 200.401 to OMB proposes to revise § 200.442 to also proposes to add a requirement for
remove references to fixed amount propose that costs for fundraising and prior approval of the Federal agency.
awards and Federal awards to hospitals. investment activities are only allowable Under the proposal, all other costs,
OMB also proposes to revise the with the prior written approval of the including the costs of subscriptions or
exemption under § 200.401(c), which Federal agency. memberships in country clubs or
allows operation under the Federal cost organizations whose primary purpose is
principles that apply to for-profit Section 200.444—General Costs of
lobbying or issue advocacy, are
organizations at 48 CFR 31.2. OMB Government
unallowable.
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proposes to apply this exemption only OMB proposes to revise § 200.444 to
to nonprofit organizations that receive add a new paragraph (b) clarifying that Section 200.455—Organization Costs
90 percent or more of their Federal general costs of government are those OMB proposes to revise § 200.455 to
funding in the form of contracts or costs related to the general activities of clarify that data costs related to
operate a Federally Funded Research the executive, legislative, or judicial integrated data systems should align
and Development Center (FFRDC). This branches of government, including with the finalized Federal grants data
proposed revision is further discussed general activities related to public standards as published on Grants.gov.
in the section-by-section discussion safety, public information, citizenship, This effort is in support of the GREAT
covering appendix VIII. enrollment, or taxation that are not Act, Public Law 116–103. Additional
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32232 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
information on these standards may be Section 200.477—Abortion plans to engage stakeholders ahead of
found at https://www.grants.gov/data- OMB proposes adding § 200.477 to any substantial changes.
standards. provide that costs associated with Section 200.514—Standards and Scope
Section 200.461—Publication and elective abortions are unallowable of Audit
Printing Costs under Federal awards except as
OMB proposes to delete some of the
expressly authorized by Federal law.
language in § 200.514(c)(1). Specifically,
OMB proposes to revise § 200.461 This addition is consistent with
OMB proposes to delete the reference to
related to publication and printing costs Executive Order 14182, Enforcing the
guidance in ‘‘Standards for Internal
to make plain language revisions, Hyde Amendment (January 24, 2025),
Control in the Federal Government’’
including removing the word and reflects longstanding appropriations
issued by the Comptroller General of the
‘‘promotion,’’ which is not the specific restrictions prohibiting the use of
United States or the ‘‘Internal Control-
subject of this section. As § 200.421 Federal funds for elective abortion
Integrated Framework’’ issued by COSO.
provides the policy for ‘‘advertising and except in limited circumstances. By
The reasons for this proposed change
public relations’’ costs, OMB wants to incorporating this limitation as a
are discussed in § 200.303 of this
ensure that the term ‘‘promotion’’ does selected item of cost, this rule promotes
document above.
not create an independent basis for uniform application of existing statutory
allowing such costs under this section. funding restrictions across Federal Appendix I to Part 200—Full Text of
To extent that advertising and public financial assistance programs while Notice of Funding Opportunity
maintaining consistency with governing OMB proposes limited changes to
relations costs are not permitted under
Federal law. appendix I. The proposed changes
§ 200.421, that section would govern.
Furthermore, OMB is revising the Subpart F—Audit Requirements include changing ‘‘program description’’
section to make publication costs to ‘‘funding opportunity description,’’
Section 200.503—Relation to Other
unallowable unless such costs are and other conforming changes to align
Audit Requirements
expressly required by statute or with the proposed policies in this
OMB proposes to revise § 200.503 to document. For example, references to
approved in advance by the Federal
clarify that a Federal agency, Inspector paper application submissions have
agency on a case-by-case basis. This
General, or GAO may only impose been removed. Agencies would be
change reflects OMB’s objective to
additional audits when authorized by required to inform applicants to submit
strengthen stewardship of Federal funds statute. This proposed revision is
and ensure that Federal financial proposals via Grants.gov and provide
intended to reduce audit burden by instructions for doing so, unless a
assistance is directed toward achieving requiring a statutory foundation and program specific exception is expressly
the programmatic objectives of the prevent agencies from layering on authorized by Federal statute or
award. Publication costs are not additional audit requirements by approved by the Federal agency head (or
inherently necessary to carry out the regulation if not required by law. This designee). OMB also proposes to add
core programmatic objectives of most revision balances proper oversight with references to Statements of Interests
Federal awards. In many cases, such limiting administrative burden, (SOIs) as discussed above in this
activities are discretionary, vary widely ensuring that core audit authority is preamble.
in scope and costs, and may serve preserved while constraining
institutional, professional, or discretionary authority to expand audit Appendix II to Part 200—Contract
reputational interests rather than the requirements beyond the Single Audit Provisions for Non-Federal Entity
specific objectives of the Federal Act requirements addressed in the part. Contracts Under Federal Awards
program. Absent statutory authority or For avoidance of doubt, this provision OMB proposes limited changes to
award-specific requirement, allowing would not preclude Federal agencies appendix II. The proposed changes
publication costs as a charge to Federal from conducting compliance reviews as include removing the reference to
awards creates inconsistent charging necessary to implement other sections rescinded Executive Orders in
practices and increases the risk that of this part and provide effective paragraph (C).
Federal funds are used for activities that oversight of Federal awards, including
to determine whether a recipient or Appendix VIII to Part 200—Nonprofit
are ancillary to program performance. Organizations Exempted From Subpart
By limiting allowability to subrecipient is in compliance with
substantive programmatic or other legal E of Part 200
circumstances in which publication is
required by statute or explicitly requirements. For example, such OMB proposes to remove appendix
incorporated into the award, this change compliance reviews may be necessary to VIII in its entirety. Consistent with the
would ensure that such costs are determine whether a recipient of revisions to § 200.401, only those
incurred only when they are directly Federal financial assistance is in nonprofit organizations that receive 90
compliance with Federal civil rights percent or more of their Federal funding
tied to a statutory or programmatic
laws or conscience protection laws. in the form of contracts, or operate a
requirement.
Federally Funded Research and
Section 200.467—Selling and Marketing Section 200.513—Responsibilities Development Center (FFRDC), will
Costs OMB proposes to revise continue to operate under the Federal
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§ 200.513(c)(4) to delete the word cost principles that apply to for-profit
OMB proposes to revise § 200.467 to ‘‘annual’’ before compliance organizations.
clarify that the costs of selling and supplement. OMB is in the process of The prior guidance created
marketing products or services of the reevaluating the appropriate frequency uncertainty by suggesting that agencies
recipient or subrecipient are for issuing the compliance supplement. could expand the list of exemptions,
unallowable unless expressly included As previously discussed in this which undermined the uniform
in the Federal award and necessary to document, OMB and the Office of application of cost principles across the
meet the requirements of the Federal Inspector General for HHS are currently Federal Government. The proposed
award. analyzing the single audit process. OMB revisions resolve these issues by
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Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules 32233
clarifying that the exemption applies contexts, procedures, or services where prime and subcontracts, grants, and
only to the narrow category of such protections apply. direct loans.
nonprofits receiving 90 percent or more Federal agencies, pass-through Environmental Protection Agency (EPA)
of their Federal funding in contracts. entities, recipients, and subrecipients
This threshold reflects that such should be aware of their ongoing This regulatory action proposes to
organizations operate more like for- statutory obligations regarding religious revise text at 2 CFR 1500.1(a)(2) to
profit entities in terms of their funding liberty and conscience irrespective of remove the term regulation.
streams and cost structures. For all other the removal of language in 2 CFR This regulatory action also proposes
nonprofit organizations, the cost 300.300(d) which provided for an to revise text at 2 CFR 1500.4,
principles in subpart E will apply. assurance process to ensure the Exceptions, to correct the citation from
This proposed revision promotes applicability of exemptions based on 2 CFR 200.102(b) to 2 CFR 200.102(c)
consistency across agencies by ensuring Federal protections for religious liberty and replace non-Federal entities with
more uniform treatment of nonprofit and conscience. The proposed removal recipients.
organizations. In addition, the revision Finally, this regulatory action
of such language should not be
improves oversight and enhances proposes to revise text at 2 CFR
misconstrued as reduced Federal
transparency by applying a clear, 1532.1125, 1532.1130(a), 1532.1200,
Government support for protections
objective standard, and preventing and 1532.1500 to replace references to
based on religion or conscience. The
agencies from unilaterally granting an obsolete system (Excluded Parties
proposed revision to 2 CFR 200.300 is
broad exemptions. List System), acronym (EPLS), and
intended to clarify that conscience and
website (http://www.EPLS.gov) with the
Appendix IX to Part 200—Hospital Cost religious liberty are protected under
current system (System for Award
Principles multiple statutes and the Federal
Management), acronym (SAM.gov
Government will enforce such statutes
OMB proposes a technical change to Exclusions), and website (SAM.gov);
as applicable. Further, § 200.300(a), as
appendix IX to reflect the new location these proposed changes also align with
proposed, contains revised language
of the Hospital cost Principles in recent changes to 2 CFR part 180, which
similar to § 300.300(d), which clarifies
appendix IX to part 300. also reference the System for Award
that in managing and administering
VII. Discussion of Proposed Revisions Management. Additionally, the
Federal awards, no person otherwise
to Subtitle B of 2 CFR by Federal proposed revisions to 2 CFR 1532.1200
eligible will be excluded from
Agencies include specific citations to referenced
participation in, unlawfully denied the
statutes to provide greater clarity.
Through this proposed rulemaking, benefits of, or otherwise subjected to
certain Federal grantmaking agencies unlawful discrimination in the Delta Regional Authority (DRA)
that currently lack an existing chapter in administration of Federal programs, The Delta Regional Authority (DRA),
2 CFR subtitle B propose to add activities, projects, assistance, and established by Congress through the
chapters, which are intended to services. Such non-discrimination Delta Regional Authority Act of 2000 (7
streamline implementation and reduce language would encompass U.S.C. 2009aa–1 et seq.), serves as a
variability across the Federal requirements, as applicable, not to Federal-state partnership to address
Government. Federal agencies that have discriminate on various bases, including economic development needs in the
existing chapters in 2 CFR subtitle B race, color, national origin, disability, Mississippi River Delta and Alabama
propose certain targeted and conforming sex, religion or conscience. Black Belt regions. This regulatory text
changes to support OMB’s broader Department of Homeland Security proposes to formally adopt OMB’s
rulemaking effort. All participating (DHS) uniform administrative requirements to
agencies adopt the common preamble provide consistency and transparency in
above. A few agencies have provided The Department of Homeland the administration of Federal financial
supplemental preamble text that Security (DHS) has included in this assistance awarded by DRA.
follows. proposed rule a potential change in This proposed action would not
delegation of authority in 2 CFR impose new grantmaking authority but
Health and Human Services (HHS) 3000.137. That section describes who would codify DRA’s participation in the
OMB has included statutory and within DHS may grant an exception to government-wide regulatory framework
national policy requirements in section let an excluded person participate in a for financial assistance. DRA currently
200.300(a), including requirements covered transaction. Currently, that operates in substantial alignment with 2
related to ‘‘religious liberty, and those section provides that the Secretary of CFR part 200, and this rulemaking
prohibiting discrimination.’’ All Federal Homeland Security has delegated the would ensure ongoing compliance
agencies must comply with RFRA (42 authority to grant such an exception to while allowing the agency to clarify or
U.S.C. 2000bb, et seq.) and any the Head of the Contracting Activity for supplement OMB’s guidance in the
applicable statutes prohibiting each DHS component. future if required by statute or regional
discrimination on the basis of religion Because 2 CFR 3000.137 relates to conditions.
or protecting the exercise of conscience. non-procurement debarment and
Federal agencies, pass-through entities, suspension, the Chief Financial Officer, Federal Permitting Improvement
recipients, and subrecipients are rather than the Head of the Contracting Steering Council (FPISC)
khammond on DSK9W7S144PROD with PROPOSALS2
required under the First Amendment, Activity, is the more appropriate The Federal Permitting Improvement
RFRA, and applicable statutes delegee. DHS intends to revise the Steering Council does not have
prohibiting discrimination based on regulatory accordingly. This proposal is independent authority to issue
religion or protecting the exercise of consistent with DHS Instruction 146– regulations specific to Federal financial
conscience, to consider and provide 01–001, Rev. 02, under which the DHS assistance programs. It has therefore
religious or conscience-based Chief Financial Officer grants waivers or received approval from OMB to
exemptions as required by law, and may limited exceptions to let an excluded implement 2 CFR part 200 as a policy
not require application of particular party participate in covered non- of the Federal Permitting Improvement
provisions or requirements to specific procurement transactions including Steering Council applicable to Federal
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32234 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
awards made by the Federal Permitting policies applicable to Federal agencies numerous flaws of the existing system,
Improvement Steering Council, rather to improve transparency, accountability, including its complexity, inefficiency,
than as a regulation. and oversight for Federal awards across administrative burden, lack of public
the Federal Government. OMB believes transparency, unfairness for smaller
Agency for International Development
that it is in the interest of Federal recipients, lack of oversight and public
(USAID) agencies, recipients and subrecipients of accountability, and lack of a policy
Through this rulemaking, the U.S. Federal awards, contractors, and other mechanism to control excessive
Agency for International Development stakeholders in the Federal financial overhead costs.105
(USAID) proposes to remove chapter VII assistance community to leave the final In January 2026, legislative language
from 2 CFR Subtitle B. This change regulatory text in place to the fullest related to indirect costs was included
reflects recent Executive Branch actions extent possible and permitted by law. within appropriations for fiscal year
to realign foreign assistance functions 2026. For example, some of these
IX. Indirect Cost Rates
and responsibilities.102 Therefore, this provisions: (i) required specified
document proposes to remove chapter On August 7, 2025, Executive Order agencies to continue applying the
VII to reflect the current administration 14332, Improving Oversight of Federal negotiated indirect cost rates in
of Federal foreign assistance programs. Grantmaking, directed OMB to revise § 200.414 to the same extent and in the
the government-wide requirements same manner as such negotiated
VIII. Severability related to indirect cost recovery to indirect cost rates were applied in fiscal
In 2024, OMB added § 1.231 to the 2 appropriately limit the use of year 2024; and (ii) prohibited specified
CFR text addressing severability.103 discretionary grant funds for costs agencies from using funds appropriated
That section—which OMB does not related to facilities and administration. for fiscal year 2026 to develop, modify,
propose to substantially modify through Over the course of decades, reports from or implement changes to fiscal year
this rulemaking—explains that the Congress, the oversight community, and 2024 negotiated indirect cost rates.
provisions of OMB’s regulatory text are various other organizations and Report language accompanying these
separate and severable from one commenters have expressed concerns provisions recognized ‘‘room for
another. It further explains that if any regarding the Federal Government’s improvement in the system used to
provision of the regulatory text is held spending on overhead associated with identify and recover indirect cost rates
to be invalid or unenforceable as grants and other forms of financial under the Uniform Guidance,
applied to a particular person or assistance.104 Reports have identified particularly with respect to the need for
circumstance, the provision should be greater transparency into these costs.’’
construed so as to continue to give the 104 See GAO Report to the Chairman,
The report language also recognized
maximum effect permitted by law as Subcommittee on Oversight and Investigations,
Committee on Energy and Commerce, House of various models suggested to achieve
applied to other persons not similarly Representatives, ‘‘Federal Research: System for improvements to the existing system,
situated or to dissimilar circumstances. Reimbursing Universities’ Indirect Costs Should Be including a model proposed by officials
If any provision is determined to be Reevaluated,’’ United States Government
from the Joint Associations Group on
wholly invalid and unenforceable, it Accountability Office (Aug. 26, 1992) (GAO Report
No. 92–203); Genevieve J. Knezo, Cong. Rsch. Serv., Indirect Costs (JAG). Some have
should be severed from the remaining Indirect Costs for R&D at Higher Education criticized the proposed JAG model for
provisions of the 2 CFR regulatory text, Institutions: Annotated Chronology of Major reasons including that it may increase
which should remain in effect. Federal Policies (CRS Report No. 94646) (Aug. 2,
overhead payments to large
In the revised regulations proposed 1994); GAO Report to Congressional Committees,
‘‘University Research: Effect of Indirect Cost organizations and fail to resolve
through this document, OMB proposes Revisions and Options for Future Changes,’’ United significant problems of the existing
a unified regulatory scheme addressing States Government Accountability Office (Mar. 6, system, including complexity,
how Federal agencies will manage 1995) (GAO Report No. 95–74); Genevieve J. Knezo,
inefficiency, and excessive overhead
Federal financial assistance to improve Cong. Rsch. Serv., Indirect Costs at Academic
Institutions: Background and Controversy (CRS spending by the Federal Government.106
transparency, accountability, and Report No. 91095) (Jan. 3, 1997); Roger G. Noll & The JAG model appears to focus only on
oversight for Federal awards across the William P. Rogerson, The Economics of University research awards, which are a subset of
Federal Government. While the revised Indirect Cost Reimbursement in Federal Research
regulations would best serve OMB’s Grants (1997). Stanford University Department of
Economics WP 97–039; GAO Report to the Ranking Subsidize University Nonsense,’’ Heritage
objectives for this rulemaking if left Member, Committee on the Budget, U.S. Senate, Foundation. Jan. 18, 2022; USAID Office of
intact as proposed by OMB, the benefits ‘‘Biomedical Research: NIH Should Assess the Inspector General, ‘‘Negotiated Indirect Cost Rate
of the guidance related to coordination Impact of Growth in Indirect Costs on Its Mission,’’ Agreements: Opportunities Exist to Improve
United States Government Accountability Office Processes and Data Management,’’ Jan. 26, 2024
across the Federal Government and (Audit Report No. 3–000–24–001–U); George
(Sep. 24, 2013) (GAO Report No. GAO–13–760);
improved transparency, accountability, Anthony Cave, ‘‘Taking a Hard Look at University Calhoun, ‘‘Universities Face a Reckoning Over
and oversight do not hinge on any single Research,’’ Stanford Social Innovation Review, Oct. Federal R&D Funding (Pt 1),’’ Forbes, Feb. 26, 2025;
provision. Accordingly, OMB considers 20, 2014; GAO Report to Congressional Requesters, Stephen Porter, ‘‘The research racket: How
‘‘NIH Biomedical Research: Agencies Involved in universities cash in on federal grants,’’ The
individual provisions to be separate and Washington Examiner (Mar. 11, 2025); Heather Mac
the Indirect Cost Rate-Setting Process Need to
severable from one another. Improve Controls,’’ GAO–16–616 (Sept. 28, 2016); Donald, ‘‘Racist—But Underfunded?’’ City Journal,
In the event of a stay or invalidation GAO Report to the Chairman, Committee on Spring 2025; Marcy E. Gallo & Laurie Harris, Cong.
of any provision, or any provision as it Science, Space, and Technology, House of Rsch. Serv., Universities and Indirect Costs for
Representatives, ‘‘National Science Foundation: Federally Funded Research (CRS Report No.
applies to a particular person or
khammond on DSK9W7S144PROD with PROPOSALS2
Preliminary Observations on Indirect Costs for R48540) (May 16, 2025); Marcy E. Gallo & Kavya
circumstance, OMB’s intent is to Research,’’ United States Government Sekar, Cong. Rsch. Serv., NIH Indirect Costs Policy
otherwise preserve the 2 CFR regulatory Accountability Office (May 24, 2017) (GAO Report for Research Grants: Recent Developments (CRS
text to the fullest possible extent. The No. GAO–17–576T); GAO Report to the Chairman, Report No. IN12516) (Dec. 9, 2025); Open the Books
Committee on Science, Space, and Technology, Oversight Report, ‘‘Transparency Crisis: A Black
provisions that remain in effect will Box of Overhead Spending & Academia’s Mission
House of Representatives, ‘‘National Science
continue to provide government-wide Foundation: Actions Needed to Improve Oversight Creep from Rigorous Science,’’ Dec. 2025.
105 Id.
of Indirect Costs for Research,’’ United States
102 See, e.g., Department of State, Congressional 106 Jeffrey Mervis, ‘‘U.S. research community says
Government Accountability Office (Sep. 28, 2017)
Notification Transmittal Letter, Mar. 28, 2025. (GAO Report No. GAO–17–721); Jay P. Greene and new indirect cost model is still too complicated,’’
103 89 FR 30046 (Apr. 22, 2024). John Schoof, ‘‘Indirect Costs: How Taxpayers Science, Jul. 18, 2025.
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Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules 32235
those awards subject to indirect cost to balance providing a path to issuing a Grocers Ass’n v. Food & Nutrition Serv.,
requirements under 2 CFR part 200. final rule that is effective by October 1 416 F. Supp. 2d 92, 109–10 (D.D.C.
In consideration of this legislative and with providing sufficient time for the 2006). Certain small entities that could
report language, OMB is not proposing public to comment on the proposed be impacted by OMB’s revised policies
updates to the indirect cost rate revisions in this document. Late will only be impacted indirectly by
negotiation system through this comments will be considered only to agency-specific implementation of the
document. OMB may consider issuing a the extent practicable. requirements or through their
request for information on this topic in interactions with recipients of Federal
the future, but commenters should not Executive Order 12866 (Regulatory
Planning and Review) and Executive awards.
submit comments on the indirect cost
rate negotiation system in response to Order 13563 (Improving Regulation and Unfunded Mandates Reform Act of 1995
this document. As no changes are Regulatory Review) The proposed revisions would not
proposed on that topic, OMB does not Executive Orders (E.O.s) 12866 and impose unfunded mandates as defined
intend to consider or respond to any 13563 direct agencies to assess all costs by the Unfunded Mandates Reform Act
such comments in the final rule. and benefits of available regulatory of 1995 (Pub. L. 104–4, 109 Stat. 48).
alternatives, and, if regulation is The proposed guidance would not result
X. Request for Comments necessary, to select regulatory in the expenditure by State, local, and
OMB and the participating agencies approaches that maximize net benefits Tribal governments, in the aggregate, or
request comments on all aspects of the (including potential economic, by the private sector, of $168 million or
proposed regulation in this document, environmental, public health and safety more in any one year (2 U.S.C. 1532). In
including on any reliance interests that effects, distributive impacts, and addition, the definition of ‘‘Federal
commenters may have based on the equity). The OMB Regulation for Grants Mandate’’ in the Unfunded Mandates
existing text of 2 CFR that proposed and Agreements published in subtitle A Reform Act excludes financial
revisions may affect, and that OMB and of 2 CFR is a regulation applicable to assistance of the type in which State,
agencies should consider in deciding Federal agencies. 2 CFR 1.100(b) local, or Tribal governments have
whether or how to finalize this (proposed version). The Office of authority to adjust their participation in
regulation. OMB is also requesting Information and Regulatory Affairs the program in accordance with changes
information from recipients on within OMB has determined that the made in the program by the Federal
requirements in 2 CFR that increase proposed amendments to 2 CFR are a Government. Federal financial
administrative burden—and particularly significant regulatory action under assistance programs subject to 2 CFR
those that increase administrative costs. section 3(f) of E.O. 12866. This rule is generally permit this type of flexibility.
OMB also welcomes comments related not expected to be considered a
to policies contained in 2 CFR that are regulatory action under Executive Order Executive Order 13132 (Federalism
not required by statute that OMB may 14192 because OMB has determined Assessment)
consider removing. that it is exempt under that Executive This proposed regulation has been
The Federal agencies participating in Order. analyzed in accordance with the
this rulemaking also request comment principles and criteria contained in E.O.
on all aspects of their proposed Regulatory Impact Assessment 13132, ‘‘Federalism,’’ 64 FR 43255 (Aug.
regulations in this document, including The Regulatory Impact Assessment 10, 1999). OMB has determined that this
on any reliance interests that (RIA) is included as a separate proposed regulation would not have
commenters may have based on the document. sufficient federalism implications to
existing text of 2 CFR subtitle B that the warrant the preparation of a federalism
Regulatory Flexibility Act
Federal agencies’ respective proposals assessment. The regulation in 2 CFR is
may affect, and that Federal agencies The Initial Regulatory Flexibility inherently national in scope and
should consider in deciding whether or Analysis (IRFA) is included as a significance.
how to finalize this regulation. separate document. OMB also provides
the following information related to the Paperwork Reduction Act
XI. Proposed Effective Date and Length attached IRFA. For a rule subject to the This regulation does not contain a
of Comment Period notice-and-comment provisions of the new requirement for information
OMB proposes to issue a final rule APA, the Regulatory Flexibility Act 5 collection. Rather, it streamlines
that is effective by October 1, 2026. The U.S.C. 601, et seq., requires that an requirements in specific sections. Thus,
proposed effective date is important to agency provide a final regulatory the Paperwork Reduction Act does not
ensure that only a single set of flexibility analysis or to certify that the apply.
government-wide requirements apply to rule will not have a significant
Federal awards made during fiscal year economic impact on a substantial Executive Order 13175 (Tribal
2027. An effective date of October 1 is number of small entities. Based on the Consultation)
useful for the audit process and other nature of the revisions proposed in this OMB has analyzed this revised
reasons, including ensuring notice, OMB does not expect this regulation in accordance with the
government-wide uniformity and guidance to have a significant economic principles and criteria contained in E.O.
transparency regarding which impact on a substantial number of small 13175, ‘‘Consultation and Coordination
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requirements apply to Federal awards entities within the meaning of the with Indian Tribal Governments’’ 65 FR
made and amended during fiscal year Regulatory Flexibility Act. 67249 (Nov. 9, 2000). During 2025,
2027. Courts have explained that the certain Tribal Nations shared concerns
OMB is providing a 45-day comment requirement under the RFA to analyze with OMB regarding potential impacts
period on the proposed rule. Before effects on small entities only applies to of 2 CFR revisions on the Federal
issuing this document, OMB also direct effects. Small entities that may be Government’s trust and treaty
considered a shorter comment period of impacted indirectly, but not directly, are obligations to Tribal Nations, and
30 days or a longer period of 60 days. not subject to analysis under the RFA. related to implementation of certain
The 45-day comment period is intended See Nat’l Women, Infants, & Child. statutes applicable to Tribes, such as the
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32236 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
Indian Self-Determination and requirements, State and local 2 CFR Part 801
Education Assistance Act (codified at 25 governments. Administrative practice and
U.S.C. 5301–5423). OMB considered procedure, Grant programs, Reporting
2 CFR Part 300
those concerns in developing this and recordkeeping requirements.
proposed rule. OMB will initiate formal Accounting, Administrative practice
Tribal consultation before a final rule is and procedure, Government contracts, 2 CFR Part 802
promulgated. Engagement with Tribes Grants administration, Loan programs, Accounting, Administrative practice
will help OMB to carefully consider Scholarships and fellowships. and procedure, Government contracts,
Tribal concerns before proposed 2 CFR Part 376 Grants administration, Loan programs,
changes are made final. Scholarships and fellowships.
Administrative practice and
List of Subjects procedure, Grant programs, Reporting 2 CFR Part 901
2 CFR Part 1 and recordkeeping requirements. Administrative practice and
Grant programs, Grants 2 CFR Part 382 procedure, Grant programs, Reporting
administration. and recordkeeping requirements.
Administrative practice and
2 CFR Part 25 procedure, Drug abuse, Grant 2 CFR Part 902
programs—health, Reporting and Administrative practice and
Accounting, Administrative practice recordkeeping requirements.
and procedure, Colleges and procedure, Drug abuse, Grant programs,
universities, Grant programs, Grants 2 CFR Part 400 Reporting and recordkeeping
administration, Hospitals, Indians, Loan requirements.
Accounting, Administrative practice
programs, Nonprofit organizations, and procedure, Agriculture, Grant 2 CFR Part 910
Reporting and recordkeeping programs—agriculture, Loan programs— Accounting, Administrative practice
requirements, State and local agriculture. and procedure, Grant programs,
governments.
2 CFR Part 417 Reporting and recordkeeping
2 CFR Part 170 requirements.
Administrative practice and
Colleges and universities, Grant procedure, Grant programs, Loan 2 CFR Part 1000
programs, Hospitals, International programs, Reporting and recordkeeping Accounting, Administrative practice
organizations, Loan programs, Reporting requirements. and procedure, Grant programs, Grants
and recordkeeping requirements. administration, Reporting and
2 CFR Part 421
2 CFR Part 175 recordkeeping requirements.
Administrative practice and
Administrative practice and procedure, Drug abuse, Grant programs, 2 CFR Part 1104
procedure, Grant programs, Indians— Reporting and recordkeeping Business and industry, Colleges and
tribal government, Nonprofit requirements. universities, Grant programs, Grants
organizations, State and local administration, Hospitals, Indians,
governments. 2 CFR Part 600
Nonprofit organizations, Small
2 CFR Part 176 Accounting, Administrative practice businesses, State and local governments.
and procedure, Government contracts,
Grants administration, Grant Grants administration, Loan programs, 2 CFR Part 1120
programs, Loan programs, Wages. Scholarships and fellowships. Business and industry, Colleges and
2 CFR Part 180 universities, Grant programs, Grants
2 CFR Part 601
administration, Hospitals, Indians,
Administrative practice and Administrative practice and Nonprofit organizations, Small
procedure, Grant programs, Loan procedure, Grant programs, Reporting businesses, State and local governments.
programs, Reporting and recordkeeping and recordkeeping requirements.
requirements. 2 CFR Part 1122
2 CFR Part 700 Business and industry, Colleges and
2 CFR Part 182
Accounting, Administrative practice universities, Grant programs, Grants
Administrative practice and and procedure, Grant programs, Loan administration, Hospitals, Human
procedure, Drug abuse, Grant programs, programs. research subjects, Indians, Nonprofit
Reporting and recordkeeping organizations, Research, Small
requirements. 2 CFR Part 701
businesses, State and local governments.
2 CFR Part 183 Foreign aid, Government contracts,
Grant programs—foreign relations, Loan 2 CFR Part 1125
Foreign aid, Grant programs, Grants programs—foreign relations. Administrative practice and
administration, International procedure, Business and industry,
organizations, Reporting and 2 CFR Part 780
Colleges and universities, Grant
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recordkeeping requirements. Administrative practice and programs, Grants administration,
procedure, Grant programs, Reporting Hospitals, Indians, Nonprofit
2 CFR Part 200
and recordkeeping requirements. organizations, Reporting and
Accounting, Administrative practice recordkeeping requirements, Small
and procedure, Colleges and 2 CFR Part 782
businesses, State and local governments.
universities, Grant programs, Grants Administrative practice and
administration, Hospitals, Indians, Loan procedure, Drug abuse, Grant programs, 2 CFR Part 1126
programs, Nonprofit organizations, Reporting and recordkeeping Grant programs, Grants
Reporting and recordkeeping requirements. administration.
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Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules 32237
2 CFR Part 1200 2 CFR Part 1800 Grants administration, Loan programs,
Administrative practice and Fees, Government property, Scholarships and fellowships.
procedure, Grant programs, Reporting Government publications, Grant 2 CFR Part 2424
and recordkeeping requirements. programs, Grants administration.
Administrative practice and
2 CFR Part 1201 2 CFR Part 1880 procedure, Grant programs, Reporting
Accounting, Administrative practice Administrative practice and and recordkeeping requirements.
and procedure, Government contracts, procedure, Grant programs, Reporting
and recordkeeping requirements. 2 CFR Part 2429
Grants administration, Loan programs,
Scholarships and fellowships. 2 CFR Part 1882 Administrative practice and
2 CFR Part 1326 procedure, Drug abuse, Grant programs,
Administrative practice and Reporting and recordkeeping
Administrative practice and procedure, Drug abuse, Grant programs, requirements.
procedure, Grant programs, Reporting Reporting and recordkeeping
and recordkeeping requirements. requirements. 2 CFR Part 2500
2 CFR Part 1327 2 CFR Part 1900 Accounting, Administrative practice
Accounting, Administrative practice and procedure, Government contracts,
Accounting, Administrative practice
and procedure, Grant programs, Grants Grants administration, Loan programs,
and procedure, Government contracts,
administration, Loan programs, Scholarships and fellowships.
Grants administration.
Nonprofit organizations, Reporting and 2 CFR Part 2520
2 CFR Part 1329 recordkeeping requirements.
Administrative practice and Administrative practice and
2 CFR Part 2000
procedure, Drug abuse, Grant programs, procedure, Grant programs, Reporting
Reporting and recordkeeping Administrative practice and and recordkeeping requirements.
requirements. procedure, Grant programs, Reporting
and recordkeeping requirements. 2 CFR Part 2600
2 CFR Part 1400
2 CFR Part 2001 Accounting, Administrative practice
Administrative practice and and procedure, Government contracts,
procedure, Grant programs, Reporting Administrative practice and
procedure, Grant programs, Reporting Grants administration, Loan programs,
and recordkeeping requirements. Scholarships and fellowships.
and recordkeeping requirements.
2 CFR Part 1401 2 CFR Part 2700
2 CFR Part 2200
Administrative practice and
Administrative practice and Administrative practice and
procedure, Drug abuse, Grant programs,
procedure, Grant programs, Reporting procedure, Grant programs, Reporting
Reporting and recordkeeping
and recordkeeping requirements. and recordkeeping requirements.
requirements.
2 CFR Part 2205 2 CFR Part 2701
2 CFR Part 1402
Accounting, Administrative practice Accounting, Administrative practice
Accounting, Administrative practice and procedure, Government contracts,
and procedure, Government contracts, and procedure, Government contracts,
Grants administration, Loan programs, Grants administration, Loan programs,
Grants administration, Loan programs, Scholarships and fellowships.
Scholarships and fellowships. Scholarships and fellowships.
2 CFR Part 2245 2 CFR Part 2800
2 CFR Part 1500
Administrative practice and
Accounting, Administrative practice procedure, Drug abuse, Grant programs, Accounting, Administrative practice
and procedure, Grant programs, Grant Reporting and recordkeeping and procedure, Government contracts,
programs—environmental protection, requirements. Grants administration, Loan programs,
Grants administration, Loan programs, Scholarships and fellowships.
Reporting and recordkeeping 2 CFR Part 2300
requirements, Waste treatment and 2 CFR Part 2867
Accounting, Administrative practice
disposal, Water pollution control, Water and procedure, Government contracts, Administrative practice and
resources, Water supply, Watersheds. Grants administration, Loan programs, procedure, Grant programs, Reporting
2 CFR Part 1532 Scholarships and fellowships. and recordkeeping requirements.
Administrative practice and 2 CFR Part 2336 2 CFR Part 2900
procedure, Grant programs, Reporting Administrative practice and
and recordkeeping requirements. Accounting, Administrative practice
procedure, Grant programs, Reporting
and procedure, Government contracts,
2 CFR Part 1536 and recordkeeping requirements.
Grant programs, Grant programs—labor,
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Administrative practice and 2 CFR Part 2339 Grants administration, Labor, Reporting
procedure, Drug abuse, Grant programs, Administrative practice and and recordkeeping requirements.
Reporting and recordkeeping procedure, Drug abuse, Grant programs, 2 CFR Part 2998
requirements. Reporting and recordkeeping
requirements. Administrative practice and
2 CFR Part 1600 procedure, Government procurement,
Administrative practice and 2 CFR Part 2400 Grant programs, Grants administration,
procedure, Reporting and recordkeeping Accounting, Administrative practice Reporting and recordkeeping
requirements. and procedure, Government contracts, requirements.
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32238 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
2 CFR Part 3000 Grants administration, Loan programs, requirements, State and local
Administrative practice and Scholarships and fellowships. governments.
procedure, Grant programs, Reporting 2 CFR Part 3485 2 CFR Part 6300
and recordkeeping requirements.
Administrative practice and Accounting, Administrative practice
2 CFR Part 3001 procedure, Grant programs, Reporting and procedure, Colleges and
Administrative practice and and recordkeeping requirements. universities, Grant programs, Grants
procedure, Drug abuse, Grant programs, administration, Hospitals, Indians, Loan
2 CFR Part 3513
Reporting and recordkeeping programs, Nonprofit organizations,
Administrative practice and Reporting and recordkeeping
requirements.
procedure, Grant programs, Reporting requirements, State and local
2 CFR Part 3002 and recordkeeping requirements. governments.
Accounting, Administrative practice 2 CFR Part 3603 2 CFR Part 6400
and procedure, Government contracts,
Accounting, Administrative practice Accounting, Administrative practice
Grants administration, Loan programs,
and procedure, Government contracts, and procedure, Colleges and
Scholarships and fellowships.
Grants administration, Loan programs, universities, Grant programs, Grants
2 CFR Part 3185 Scholarships and fellowships. administration, Hospitals, Indians, Loan
Administrative practice and 2 CFR Part 3700 programs, Nonprofit organizations,
procedure, Grant programs, Reporting Reporting and recordkeeping
Administrative practice and requirements, State and local
and recordkeeping requirements.
procedure, Grant programs, Reporting governments.
2 CFR Part 3186 and recordkeeping requirements.
Administrative practice and 2 CFR Part 6500
2 CFR Part 3701
procedure, Drug abuse, Grant programs, Accounting, Administrative practice
Reporting and recordkeeping Administrative practice and and procedure, Colleges and
requirements. procedure, Grant programs, Reporting universities, Grant programs, Grants
and recordkeeping requirements. administration, Hospitals, Indians, Loan
2 CFR Part 3187
2 CFR Part 5800 programs, Nonprofit organizations,
Administrative practice and Reporting and recordkeeping
procedure, Civil rights, Grant programs, Administrative practice and
requirements, State and local
Museums. procedure, Grant programs, Reporting
governments.
and recordkeeping requirements.
2 CFR Part 3254 2 CFR Part 6600
2 CFR Part 5801
Administrative practice and Accounting, Administrative practice
procedure, Grant programs, Reporting Accounting, Administrative practice
and procedure, Federal financial and procedure, Colleges and
and recordkeeping requirements. universities, Grant programs, Grants
assistance, Grant programs, Grants
2 CFR Part 3255 administration, Intergovernmental administration, Hospitals, Indians, Loan
relations, State and local governments. programs, Nonprofit organizations,
Accounting, Administrative practice Reporting and recordkeeping
and procedure, Government contracts, 2 CFR Part 5900 requirements, State and local
Grants administration, Loan programs, governments.
Scholarships and fellowships. Accounting, Administrative practice
and procedure, Grant programs, Grants The Secretary of the Department of Health
2 CFR Part 3256 administration. and Human Services, Robert F. Kennedy, Jr.,
Administrative practice and approves this document, Regulation for
2 CFR Part 6000 Federal Financial Assistance, and authorizes
procedure, Drug abuse, Grant programs, Russell T. Vought, Director of the Office of
Reporting and recordkeeping Accounting, Administrative practice
and procedure, Grant programs, Grants Management and Budget to digitally sign this
requirements. document for purposes of publication in the
administration, Loan programs,
2 CFR Part 3369 Federal Register.
Nonprofit organizations, Reporting and
Robert F. Kennedy, Jr.,
Administrative practice and recordkeeping requirement.
Secretary, Department of Health and Human
procedure, Grant programs, Reporting 2 CFR Part 6100 Services.
and recordkeeping requirements.
Accounting, Administrative practice The Principal Deputy Chief Financial
2 CFR Part 3373 and procedure, Colleges and Officer of the Department of Agriculture,
universities, Grant programs, Grants Candice M. Kinn, approves this document,
Administrative practice and Regulation for Federal Financial Assistance,
procedure, Drug abuse, Grant programs, administration, Hospitals, Indians, Loan and authorizes Russell T. Vought, Director of
Reporting and recordkeeping programs, Nonprofit organizations, the Office of Management and Budget to
requirements. Reporting and recordkeeping digitally sign this document for purposes of
requirements, State and local publication in the Federal Register.
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2 CFR Part 3374 governments. Candice M. Kinn,
Accounting, Administrative practice Principal Deputy Chief Financial Officer.
2 CFR Part 6200
and procedure, Government contracts, The Senior Advisor and Deputy Chief
Grants administration, Loan programs, Accounting, Administrative practice
Acquisition Officer of the U.S. Department of
Scholarships and fellowships. and procedure, Colleges and State, Kyle Ilgenfritz, approves this
universities, Grant programs, Grants document, Regulation for Federal Financial
2 CFR Part 3474 administration, Hospitals, Indians, Loan Assistance, and authorizes Russell T. Vought,
Accounting, Administrative practice programs, Nonprofit organizations, Director of the Office of Management and
and procedure, Government contracts, Reporting and recordkeeping Budget to digitally sign this document for
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Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules 32239
purposes of publication in the Federal Office of Management and Budget to digitally purposes of publication in the Federal
Register. sign this document for purposes of Register.
Kyle Ilgenfritz, publication in the Federal Register. Eleni Jernell,
Senior Advisor and Deputy Chief Acquisition Olivia Bradley, Acting Director, Office of Administration.
Officer. Director for Acquisition Management. The Interim Agency Head of the
The Chief Acquisition Officer of the Effective immediately, Troy Finnegan, Corporation for National and Community
Agency for International Development, Deputy Assistant Secretary, Exercising the Service, Jennifer Bastress, approves this
Matthew Dickinson, approves this document, Delegated Authority of the Assistant document, Regulation for Federal Financial
Regulation for Federal Financial Assistance, Secretary—Policy, Management and Budget, Assistance, and authorizes Russell T. Vought,
and authorizes Russell T. Vought, Director of Director of the Office of Management and
approves the Regulation for Federal
the Office of Management and Budget to Budget to digitally sign this document for
Financial Assistance. The OMB Director, purposes of publication in the Federal
digitally sign this document for purposes of
publication in the Federal Register. Russell Vought, is authorized to digitally sign Register.
the aforementioned document for publication
Matthew Dickinson, Jennifer Bastress,
in the Federal Register.
Chief Acquisition Officer. Interim Agency Head.
Troy Finnegan,
The Assistant Secretary for Management The General Counsel of the Social Security
Deputy Assistant Secretary, Exercising the Administration, Mark Steffensen, approves
and Chief Financial Officer of the
Department of Veteran Affairs, Richard Delegated Authority of the Assistant this document, Regulation for Federal
Topping, approves this document, Regulation Secretary—Policy, Management and Budget. Financial Assistance, and authorizes Russell
for Federal Financial Assistance, and The Chief Financial Officer and Chief T. Vought, Director of the Office of
authorizes Russell T. Vought, Director of the Administrative Office of the U.S. Management and Budget to digitally sign this
Office of Management and Budget to digitally Environmental Protection Agency, C. Paige document for purposes of publication in the
sign this document for purposes of Hanson, approves this document, Regulation Federal Register.
publication in the Federal Register. for Federal Financial Assistance, and Mark Steffensen,
Richard Topping, authorizes Russell T. Vought, Director of the General Counsel.
Assistant Secretary for Management and Office of Management and Budget to digitally
The Deputy Secretary of the Department of
Chief Financial Officer. sign this document for purposes of
Housing and Urban Development, Andrew
publication in the Federal Register.
The Office of Management Director of the Hughes, approves this document, Regulation
Department of Energy, Derek Passarelli, C. Paige Hanson, for Federal Financial Assistance, and
approves this document, Regulation for Chief Financial Officer and Chief authorizes Russell T. Vought, Director of the
Federal Financial Assistance, and authorizes Administrative Officer. Office of Management and Budget to digitally
Russell T. Vought, Director of the Office of The Administrative Counsel of the U.S. sign this document for purposes of
Management and Budget to digitally sign this International Development Finance publication in the Federal Register.
document for purposes of publication in the Corporation, Lisa Wischkaemper, approves Andrew Hughes,
Federal Register. Deputy Secretary.
this document, Regulation for Federal
Derek Passarelli, Financial Assistance, and authorizes Russell The Senior Official Performing the Duties
Office of Management Director. T. Vought, Director of the Office of of the Director of the National Science
The Assistant Secretary for Management of Management and Budget to digitally sign this Foundation, Brian Stone, approves this
the Department of the Treasury, Dr. John W. document for purposes of publication in the document, Regulation for Federal Financial
York, Ph.D., approves this document, Federal Register. Assistance, and authorizes Russell T. Vought,
Regulation for Federal Financial Assistance, Lisa Wischkaemper, Director of the Office of Management and
and authorizes Russell T. Vought, Director of Budget to digitally sign this document for
Administrative Counsel.
the Office of Management and Budget to purposes of publication in the Federal
digitally sign this document for purposes of The Acting Senior Procurement Executive, Register.
publication in the Federal Register. Assistant Administrator for Procurement of Brian Stone,
John W. York, the National Aeronautics and Space
Administration, Marvin L. Horne, approves Senior Official Performing the Duties of the
Assistant Secretary for Management. this document, Regulation for Federal Director.
The Research Policy Director of the Financial Assistance, and authorizes Russell The Acting Archivist of the United States
Department of Defense, Jason Day, approves T. Vought, Director of the Office of of the National Archives and Records
this document, Regulation for Federal Management and Budget to digitally sign this Administration, Edward C. Forst, approves
Financial Assistance, and authorizes Russell document for purposes of publication in the this document, Regulation for Federal
T. Vought, Director of the Office of Federal Register. Financial Assistance, and authorizes Russell
Management and Budget to digitally sign this T. Vought, Director of the Office of
document for purposes of publication in the Marvin L. Horne, Management and Budget to digitally sign this
Federal Register. Assistant Administrator for Procurement. document for purposes of publication in the
Jason Day, The Deputy Director of Management Federal Register.
Research Policy Director. Services of the U.S. Agency for Global Media, Edward C. Forst,
Christopher Luer, approves this document, Acting Archivist of the United States.
The Assistant Secretary for Administration
of the Department of Transportation, Anne Regulation for Federal Financial Assistance, The Administrator of the Small Business
Byrd, approves this document, Regulation for and authorizes Russell T. Vought, Director of Administration, Kelly Loeffler, approves this
Federal Financial Assistance, and authorizes the Office of Management and Budget to document, Regulation for Federal Financial
Russell T. Vought, Director of the Office of digitally sign this document for purposes of Assistance, and authorizes Russell T. Vought,
Management and Budget to digitally sign this publication in the Federal Register. Director of the Office of Management and
khammond on DSK9W7S144PROD with PROPOSALS2
document for purposes of publication in the Christopher Luer, Budget to digitally sign this document for
Federal Register. Deputy Director of Management Services. purposes of publication in the Federal
Anne Sanford Byrd, Register.
The Acting Director of the Office of
Assistant Secretary for Administration. Administration of the Nuclear Regulatory Kelly Loeffler,
The Director for Acquisition Management Commission, Eleni Jernell, approves this Administrator.
of the Department of Commerce, Olivia document, Regulation for Federal Financial Pursuant to authority delegated from the
Bradley, approves this document, Regulation Assistance, and authorizes Russell T. Vought, Acting Attorney General, the Assistant
for Federal Financial Assistance, and Director of the Office of Management and Attorney General of the Office of Legal
authorizes Russell T. Vought, Director of the Budget to digitally sign this document for Policy, Department of Justice, Daniel E.
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32240 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
Burrows, approves this document, Regulation purposes of publication in the Federal document for purposes of publication in the
for Federal Financial Assistance, and Register. Federal Register.
authorizes Russell T. Vought, Director of the Murray Bessette, Alberta E. Mills,
Office of Management and Budget to digitally Assistant Secretary for the Office of Planning, Secretary.
sign this document for purposes of Evaluation, and Policy Development. The Federal Co-Chairman of the Delta
publication in the Federal Register. The General Counsel of the Export-Import Regional Authority, Corey Wiggins, approves
Daniel E. Burrows, Bank of the United States, Tony Onorato, this document, Regulation for Federal
Assistant Attorney General, Office Of Legal approves this document, Regulation for Financial Assistance, and authorizes Russell
Policy. Federal Financial Assistance, and authorizes T. Vought, Director of the Office of
The Assistant Secretary for Administration Russell T. Vought, Director of the Office of Management and Budget to digitally sign this
and Management of the Department of Labor, Management and Budget to digitally sign this document for purposes of publication in the
document for purposes of publication in the Federal Register.
Dean Heyl, approves this document,
Federal Register.
Regulation for Federal Financial Assistance, Corey Wiggins,
and authorizes Russell T. Vought, Director of Tony Onorato,
Federal Co-Chairman.
the Office of Management and Budget to General Counsel.
The Acting Executive Director of the
digitally sign this document for purposes of The General Counsel of the Office of
Appraisal Subcommittee of the Federal
publication in the Federal Register. National Drug Control Policy, Dario
Financial Institutions Examination Council,
Dean Heyl, Camacho, approves this document,
Regulation for Federal Financial Assistance, Frederick Griefer, approves this document,
Assistant Secretary for Administration and Regulation for Federal Financial Assistance,
and authorizes Russell T. Vought, Director of
Management. and authorizes Russell T. Vought, Director of
the Office of Management and Budget to
The Deputy Secretary of the Department of digitally sign this document for purposes of the Office of Management and Budget to
Homeland Security, Troy Edgar, approves publication in the Federal Register. digitally sign this document for purposes of
this document, Regulation for Federal publication in the Federal Register.
Dario Camacho,
Financial Assistance, and authorizes Russell Frederick Griefer,
General Counsel.
T. Vought, Director of the Office of Acting Executive Director.
Management and Budget to digitally sign this The General Counsel of the Peace Corps,
Alexis Fowler, approves this document, The Executive Director of the Marine
document for purposes of publication in the
Regulation for Federal Financial Assistance, Mammal Commission, Peter O. Thomas,
Federal Register.
and authorizes Russell T. Vought, Director of approves this document, Regulation for
Troy Edgar, the Office of Management and Budget to Federal Financial Assistance, and authorizes
Deputy Secretary. digitally sign this document for purposes of Russell T. Vought, Director of the Office of
The Deputy General Counsel and Acting publication in the Federal Register. Management and Budget to digitally sign this
General Counsel of the Institute of Museum Alexis Fowler, document for purposes of publication in the
and Library Services, Victoria H. Kauffman, General Counsel. Federal Register.
approves this document, Regulation for The Executive Director of the Election Peter O. Thomas,
Federal Financial Assistance, and authorizes Assistance Commission, Brianna Schletz, Executive Director.
Russell T. Vought, Director of the Office of approves this document, Regulation for The Acting Vice President and Chief
Management and Budget to digitally sign this Federal Financial Assistance, and authorizes Financial Officer of the Millennium
document for purposes of publication in the Russell T. Vought, Director of the Office of Challenge Corporation, Abdel Maliky,
Federal Register. Management and Budget to digitally sign this approves this document, Regulation for
Victoria H. Kauffman, document for purposes of publication in the Federal Financial Assistance, and authorizes
Deputy General Counsel and Acting General Federal Register. Russell T. Vought, Director of the Office of
Counsel. Brianna Schletz, Management and Budget to digitally sign this
The Chairman of the National Endowment Executive Director. document for purposes of publication in the
for the Arts, Mary Anne Carter, approves this The Executive Director of the Gulf Coast Federal Register.
document, Regulation for Federal Financial Ecosystem Restoration Council, Mary Walker, Abdel Maliky,
Assistance, and authorizes Russell T. Vought, approves this document, Regulation for Acting Vice President and Chief Financial
Director of the Office of Management and Federal Financial Assistance, and authorizes Officer.
Budget to digitally sign this document for Russell T. Vought, Director of the Office of
Management and Budget to digitally sign this By the National Credit Union
purposes of publication in the Federal
document for purposes of publication in the Administration Board, this 13th day of May,
Register.
Federal Register. 2026, the Secretary of the Board of the
Mary Anne Carter, National Credit Union Administration,
Mary Walker,
Chairman. Melane Conyers-Ausbrooks, approves this
Executive Director.
The Acting General Counsel of the Notice of Proposed Rule, Regulation for
National Endowment for the Humanities, The Managing Director of the Federal Federal Financial Assistance, (RIN 3133–
Communications Commission, Daniel Daly, AG07) and authorizes Russell T. Vought,
Lisette Voyatzis, approves this document,
approves this document, Regulation for Director of the Office of Management and
Regulation for Federal Financial Assistance,
Federal Financial Assistance, and authorizes Budget to digitally sign this document for
and authorizes Russell T. Vought, Director of
Russell T. Vought, Director of the Office of
the Office of Management and Budget to purposes of publication in the Federal
Management and Budget to digitally sign this
digitally sign this document for purposes of Register.
document for purposes of publication in the
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publication in the Federal Register. Federal Register. Melane Conyers-Ausbrooks,
Lisette Voyatzis, Daniel Daly, Secretary of the Board.
Acting General Counsel. Managing Director. Russell T. Vought,
The Assistant Secretary of the Department The Secretary of the Consumer Product Director, Office of Management and Budget.
of Education, Murray Bessette, approves this Safety Commission, Alberta E. Mills,
document, Regulation for Federal Financial approves this document, Regulation for For the reasons stated in the
Assistance, and authorizes Russell T. Vought, Federal Financial Assistance, and authorizes preamble, 2 CFR subtitles A and B are
Director of the Office of Management and Russell T. Vought, Director of the Office of proposed to be amended as set forth
Budget to digitally sign this document for Management and Budget to digitally sign this below:
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Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules 32241
1. Revise part 1 to read as follows: Subpart B—Introduction to Subtitle A § 1.221 Alternative implementation of this
subtitle by certain Federal agencies.
PART 1—ABOUT TITLE 2 OF THE § 1.200 Purpose of chapters I and II. The Federal agencies listed in this
CODE OF FEDERAL REGULATIONS Chapters I and II of this subtitle section received approval from OMB to
AND SUBTITLE A provide OMB regulations applicable to implement the OMB regulations in this
Federal agencies that help to ensure subtitle, including part 200, as policy
Subpart A—Introduction to Title 2 of the
CFR consistent and uniform Government- applicable to their Federal awards
wide policies, requirements, and without establishing agency regulations
Sec.
procedures for the management of the in subtitle B of this title as described at
100 Content of this title.
1.105 Organization and subtitle content. agencies’ Federal financial assistance. § 1.220. Like all other Federal agencies,
1.110 Issuing authorities. the listed Federal agencies must
§ 1.205 Applicability to Federal financial implement the requirements in this
Subpart B—Introduction to Subtitle A assistance. subtitle in their announcements of
1.200 Purpose of chapters I and II. The types of instruments that are funding opportunities and the terms and
1.205 Applicability to Federal financial subject to the regulations in this subtitle conditions of their Federal awards. The
assistance. vary from one portion of the regulations listed Federal agencies are:
1.210 Applicability to Federal agencies and (a) Denali Commission;
to another. All portions of the
others. (b) Southwest Border Regional
1.215 Relationship to previous issuances by regulations apply to grants and
OMB. cooperative agreements, and some Commission (SBRC);
1.220 Federal agency implementation of portions also apply to other types of (c) Southeast Crescent Regional
this subtitle. Federal financial assistance. Commission (SCRC);
1.221 Alternative implementation of this (d) Appalachian Regional
subtitle by certain Federal agencies. § 1.210 Applicability to Federal agencies Commission (ARC);
1.230 Maintenance of this subtitle. and others. (e) Northern Border Regional
1.231 Severability. (a) This subtitle contains regulations Commission (NBRC);
that directly apply only to Federal (f) Federal Permitting Improvement
Subpart C—Responsibilities of OMB and
Federal Agencies agencies. Steering Council; and
(g) Export Import Bank of the United
1.300 OMB responsibilities. (b) The regulations in this subtitle States.
1.305 Federal agency responsibilities. may affect other entities through each
Authority: 31 U.S.C. 503; 31 U.S.C. 1111; Federal agency’s implementation of the § 1.230 Maintenance of this subtitle.
31 U.S.C. 6307; 41 U.S.C. 1121; E.O. 11541, regulations, portions of which may OMB issues regulations in this
35 FR 10737, 3 CFR, 1966–1970 Comp., p. apply to: subtitle after publication in the Federal
939; Reorganization Plan No. 2 of 1970. (1) The agency’s awarding or Register. Any portion of the regulations
administering officials; that has a potential impact on the public
Subpart A—Introduction to Title 2 of is published with an opportunity for
(2) Recipients and subrecipients that
the CFR public comment.
receive or apply for the agency’s Federal
§ 1.100 Content of this title. financial assistance or receive § 1.231 Severability.
This title contains: subawards under grants or cooperative
agreements; or The provisions of this subtitle are
(a) Office of Management and Budget separate and severable from one
(OMB) regulations applicable to Federal (3) Any other entities involved in another. If any provision of this subtitle
agencies on Government-wide policies agency transactions subject to the is held invalid or unenforceable as
for the award and administration of regulations in this chapter. applied to a particular person or
Federal financial assistance, including § 1.215 Relationship to previous issuances circumstance, the provision should be
the Uniform Grants Regulation (UGR) at by OMB. construed so as to continue to give the
part 200; and maximum effect permitted by law as
This subtitle superseded previous
(b) Federal agency regulations applied to other persons not similarly
OMB guidance issued under certain
implementing or supplementing the situated or to dissimilar circumstances.
OMB circulars and other guidance
OMB regulations. If any provision is determined to be
documents related to the same subject
wholly invalid and unenforceable, it
§ 1.105 Organization and subtitle content. matter.
should be severed from the remaining
(a) This title is organized into two § 1.220 Federal agency implementation of provisions of this subtitle, which should
subtitles. this subtitle. remain in effect.
(b) The OMB regulations described in A Federal agency that awards Federal
§ 1.100(a) are published in this subtitle. Subpart C—Responsibilities of OMB
financial assistance subject to the OMB
and Federal Agencies
(c) Each Federal agency that awards regulations in this subtitle implements
Federal financial assistance has a or supplements the OMB regulations in § 1.300 OMB responsibilities.
chapter in subtitle B of this title in agency regulations in subtitle B of this OMB is responsible for:
which it issues the regulations title and in guidance documents, policy (a) Issuing and maintaining the
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described in § 1.100(b). Federal agency documents, and procedural issuances, regulations in this subtitle, as described
regulations in subtitle B adopt and such as internal instructions to the in § 1.230;
implement the OMB regulations in this agency’s awarding and administering (b) Interpreting requirements in this
subtitle. officials. An applicant, recipient, or subtitle;
subrecipient would see the effect of that (c) Reviewing Federal agency
§ 1.110 Issuing authorities. implementation in the organization and regulations implementing or
OMB issues this subtitle. Each Federal content of the agency’s announcements supplementing the requirements of this
agency that has a chapter in subtitle B of funding opportunities and in its subtitle, as required by Executive Order
of this title issues that chapter. award terms and conditions. 12866;
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(d) Conducting broad oversight of on or after the effective date of this ■ 10. In § 170.210, revise paragraph (a)
Government-wide compliance with the regulation. A notice of funding to read as follows:
regulations in this subtitle; and opportunity is any electronic issuance
(e) Performing other OMB functions § 170.210 Requirements for notices of
that a Federal agency uses to announce
funding opportunities, regulations, and
specified in this subtitle. a funding opportunity, whether it is application instructions.
called a ‘‘program announcement,’’
§ 1.305 Federal agency responsibilities. (a) A Federal agency that makes
‘‘notice of funding availability,’’ ‘‘broad
The head of each Federal agency that Federal awards subject to the
agency announcement,’’ ‘‘research
awards and administers Federal Transparency Act must include the
announcement,’’ ‘‘solicitation,’’ or any
financial assistance subject to the OMB requirements of paragraph (b) of this
other term.
regulations in this subtitle is responsible section in each notice of funding
* * * * * opportunity, regulation, or other
for: ■ 6. In appendix A, in paragraph I.(c),
(a) Implementing the regulations in issuance containing instructions for
revise the definition of ‘‘System for applicants under which Federal awards
this subtitle;
Award Management (SAM.gov)’’ to read may be made that are subject to
(b) Ensuring that the Federal agency
as follows: Transparency Act reporting
complies with its implementation of the
OMB regulations; Appendix A to Part 25—Award Term requirements. A notice of funding
(c) Coordinating with the Council on opportunity is any electronic issuance
I. * * * that a Federal agency uses to announce
Federal Financial Assistance, the Grants (c) * * *
Quality Service Management Office, and System for Award Management (SAM.gov)
a funding opportunity, whether it is
other governance committees as means the Federal repository into which a called a ‘‘program announcement,’’
appropriate; and recipient must provide the information ‘‘notice of funding availability,’’ ‘‘broad
(d) Performing other functions required for the conduct of business as a agency announcement,’’ ‘‘research
specified in this subtitle. recipient. Additional information about announcement,’’ ‘‘solicitation,’’ or any
registration procedures may be found in other term.
■ 2. Revise the heading of chapter I to
SAM.gov. * * * * *
read as follows:
* * * * * ■ 11. In appendix A to part 170, revise
Chapter I—OFFICE OF MANAGEMENT AND paragraphs I.(a)(2)(i), I.(b)(2)(i),
BUDGET GOVERNMENT-WIDE PART 170—REPORTING SUBAWARD I.(c)(1)(iii), and I.(c)(2) to read as
REGULATION FOR FEDERAL FINANCIAL AND EXECUTIVE COMPENSATION
ASSISTANCE
follows:
INFORMATION
Appendix A to Part 170—Award Term
PART 25—UNIQUE ENTITY IDENTIFIER ■ 7. The authority citation for part 170
AND SYSTEM FOR AWARD I. * * *
continues to read as follows: (a) * * *
MANAGEMENT Authority: 31 U.S.C. 503; 31 U.S.C. 6102; (2) * * *
■ 3. The authority citation for part 25 31 U.S.C. 6307; Pub. L. 109–282; Pub. L. 110– (i) The recipient must report each
continues to read as follows: 252, Pub. L. 113–101, Pub. L. 117–40. subaward described in paragraph (a)(1) of
this award term to the Transparency Act
Authority: 31 U.S.C. 503; 31 U.S.C. 6101 ■ 8. Revise § 170.100 to read as follows:
Subaward Reporting System at SAM.gov.
note; 31 U.S.C. 6102; 31 U.S.C. 6307; 41
§ 170.100 Purpose of this part. * * * * *
U.S.C. 2313; Pub. L. 109–282; Pub. L. 110–
This part provides policies applicable (b) * * *
252; Pub. L. 113–101; Pub. L. 117–40. (2) * * *
to Federal agencies on establishing (i) As part of the recipient’s registration
■ 4. Revise § 25.100 to read as follows:
requirements for recipients of Federal profile at SAM.gov.
§ 25.100 Purpose of this part. awards to report information on
* * * * *
This part provides policies applicable subawards and executive total (c) * * *
to Federal agencies regarding: compensation, as required by the (1) * * *
(a) The unique entity identifier (UEI), Federal Funding Accountability and (iii) The public does not have access to
which is the universal identifier for Transparency Act of 2006 (Pub. L. 109– information about the compensation of the
Federal financial assistance applicants, 282), as amended by the Digital executives through periodic reports filed
Accountability and Transparency Act of under section 13(a) or 15(d) of the Securities
as well as recipients and their direct Exchange Act of 1934 (15 U.S.C. 78m(a),
subrecipients (first-tier subrecipients); 2014 (Pub. L. 113–101) and other Public
Laws, hereinafter referred to as the 78o(d)) or section 6104 of the Internal
and Revenue Code of 1986 after receiving this
(b) The System for Award ‘‘Transparency Act.’’ subaward. (To determine if the public has
Management (SAM.gov), which is the ■ 9. In § 170.200, revise paragraph (a) to access to the compensation information, see
repository for standard information read as follows: the U.S. Security and Exchange Commission
about applicants and recipients. total compensation filings at https://
§ 170.200 Federal agency reporting www.sec.gov/answers/execomp.htm.)
■ 5. In § 25.200, revise paragraph (a) to requirements. (2) Reporting Requirements. Subrecipients
read as follows: (a) Federal agencies must publicly must report to the recipient their executive
§ 25.200 Requirements for notice of report Federal awards that equal or total compensation described in paragraph
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funding opportunities, regulations, and exceed the micro-purchase threshold (c)(1) of this appendix. The recipient is
application instructions. (see 2 CFR 200.1). Federal agencies must required to submit this information to the
Transparency Act Subaward Reporting
(a) A Federal agency that issues publish the required Federal award
System at SAM.gov no later than the end of
Federal financial assistance (see information on USAspending.gov in the month following the month in which the
§ 25.400) must include the requirements accordance with the policies provided subaward was made. (For example, if the
of paragraph (b) of this section in each by OMB and the U.S. Department of the subaward was made on November 7, 2025,
notice of funding opportunity, Treasury’s Government-wide Spending the subaward must be reported by no later
regulation, or other issuance containing Data Model (GSDM). than December 31, 2025).
instructions for applicants that is issued * * * * * * * * * *
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PART 175—AWARD TERM FOR covered by subparts A through I of this (1) Made in accordance with
TRAFFICKING IN PERSONS part must issue regulations consistent § 180.135; and
with those subparts. (2) The OMB Director provides
■ 12. The authority citation for part 175 ■ 19. In § 180.25, revise paragraph (a) concurrence.
continues to read as follows: and paragraph (b) introductory text to ■ 22. Revise § 180.530 to read as
Authority: 22 U.S.C. 7104(g); 22 U.S.C. read as follows: follows:
7104a; 22 U.S.C. 7104b; 22 U.S.C. 7104c; 31
U.S.C. 503; 31 U.S.C. 6307; 31 U.S.C. 1111; § 180.25 What must a Federal agency § 180.530 Where can I find SAM.gov
41 U.S.C. 1121; Reorganization Plan No. 2 of address in its implementation of this part? Exclusions?
1970; E.O. 11541, 35 FR 10737. * * * * * You may access SAM.gov Exclusions
■ 13. In § 175.105, revise paragraph (a) (a) Must establish policies and through the internet, currently at
introductory text to read as follows: procedures for that Federal agency’s SAM.gov.
nonprocurement debarment and
■ 23. Revise § 180.620 to read as
§ 175.105 Statutory requirement. suspension programs and activities
follows:
(a) Federal agencies are required to consistent with this part. When adopted
include in each Federal grant or by a Federal agency, this part has a § 180.620 Do Federal agencies coordinate
cooperative agreement a condition that regulatory effect on that Federal suspension and debarment actions?
authorizes the Federal agency to agency’s programs and activities. Yes. When more than one Federal
terminate the award or take any Federal agencies must not deviate from agency has an interest in a suspension
remedial actions authorized by 22 the requirements of this part on matters or debarment, the agencies may
U.S.C. 7104b(c), without penalty, if a for which discretion is not provided. consider designating one Federal agency
private entity receiving funds under the (b) Must address some matters for as the lead agency for making the
award as a recipient or subrecipient which this part gives each Federal decision. Agencies are encouraged to
engages in any of the activities agency some discretion. Specifically, establish methods and procedures for
described in 22 U.S.C. 7104(g) related to the regulation must: coordinating their suspension and
human trafficking, including: * * * * * debarment actions.
* * * * * ■ 20. Revise § 180.150 to read as ■ 24. In § 180.745, revise paragraph (b)
follows: to read as follows:
PART 176—[Removed]
§ 180.150 Against whom may a Federal § 180.745 How is fact-finding conducted?
■ 14. Remove part 176. agency take an exclusion action?
* * * * *
Given a cause that justifies an
PART 180—OMB GUIDELINES TO (b) A transcribed record of fact-
exclusion under this part, a Federal
AGENCIES ON GOVERNMENT-WIDE finding proceedings must be made,
agency may exclude any person who
DEBARMENT AND SUSPENSION unless you, as a respondent, and the
has been, is, or may reasonably be
(NONPROCUREMENT) Federal agency agree to waive it in
expected to be, a participant or
advance. If you want a copy of the
■ 15. The authority citation for part 180 principal in a covered transaction.
transcribed record, you may purchase it
continues to read as follows: ■ 21. In § 180.215, revise paragraph (h)
and the Federal agency must provide it
to read as follows:
Authority: 31 U.S.C. 503; 31 U.S.C. 6102; to you within five business days.
31 U.S.C. 6307; Pub. L. 103–355; Pub. L. 109– § 180.215 Which nonprocurement ■ 25. In § 180.840, revise paragraph (b)
282; Pub. L. 110–252; Pub. L. 111–84; Pub. transactions are not covered transactions? to read as follows:
L. 113–101Pub. L. 115–232; Pub. L. 117–40;
E.O. 12549; E.O. 12689. * * * * *
§ 180.840 How is fact-finding conducted?
(h) Notwithstanding paragraph (a) of
■ 16. Revise § 180.5 to read as follows: this section, covered transactions must * * * * *
include non-procurement and (b) A transcribed record of fact-
§ 180.5 What does this part do?
procurement transactions involving finding proceedings must be made
This part provides regulatory entities engaged in activity that unless you, as a respondent, and the
guidelines applicable to Federal contributed to or is a significant factor Federal agency agree to waive it in
agencies regarding how to implement in a country’s non-compliance with its advance. If you want a copy of the
the Government-wide debarment and obligations under arms control, transcribed record, you may purchase it
suspension system for nonprocurement nonproliferation or disarmament and the Federal agency must provide it
programs and activities. agreements, or commitments with the to you within five business days.
■ 17. Revise § 180.15 to read as follows:
United States. Federal agencies and ■ 26. Revise § 180.915 to read as
§ 180.15 To whom does this part apply? primary tier non-procurement recipients follows:
This part provides regulatory must not award, renew, or extend a non-
§ 180.915 Civil judgment.
guidelines applicable to Federal procurement transaction or procurement
agencies. Federal agencies’ transaction, regardless of amount or tier, Civil judgment means the disposition
implementation of this part governs the with any entity listed in SAM.gov of a civil action by any court of
rights and responsibilities of other Exclusions on the basis of involvement competent jurisdiction, whether by
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persons affected by the nonprocurement in activities that violate arms control, verdict, decision, settlement,
debarment and suspension system. nonproliferation or disarmament stipulation, or other disposition which
■ 18. Revise § 180.20 to read as follows: agreements, or commitments with the creates a civil liability for the
United States (see section 1290 of the complained of wrongful acts or a final
§ 180.20 What must a Federal agency do to National Defense Authorization Act for determination of liability under the
implement these guidelines? Fiscal Year 2017). The head of a Federal Administrative False Claims Act of 2023
As section 3 of Executive Order 12549 agency may grant an exception to the (31 U.S.C. 3801–3812).
requires, each Federal agency with requirement under this section only if ■ 27. Revise § 180.965 to read as
nonprocurement programs and activities the exception is: follows:
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32244 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
§ 180.965 Legal proceedings. requirements of this part on matters for § 182.630 Debarment.
Legal proceeding means any criminal which discretion is not provided. Debarment means an action taken by
proceeding or any civil judicial (b) Must address some matters for a Federal agency to prohibit a recipient
proceeding, including a proceeding which this part gives the Federal agency from participating in Federal
under the Administrative False Claims discretion. Specifically, the regulation Government procurement contracts and
Act of 2023 (31 U.S.C. 3801–3812), to must: covered nonprocurement transactions.
which the Federal Government or a * * * * * A recipient so prohibited is debarred, in
State or local government or quasi- (c) May also, at the Federal agency’s accordance with the Federal Acquisition
governmental authority is a party. The option, identify any specific types of Regulation for procurement contracts
term also includes appeals from those financial assistance awards, in addition (48 CFR part 9, subpart 9.4) and Federal
proceedings. to grants and cooperative agreements, to agency regulations implementing the
which the Federal agency makes this OMB regulation on nonprocurement
PART 182—GOVERNMENT-WIDE debarment and suspension (2 CFR part
REQUIREMENTS FOR DRUG-FREE part applicable.
■ 33. Revise § 182.30 to read as follows: 180, which implements Executive
WORKPLACE (FINANCIAL Orders 12549 and 12689).
ASSISTANCE) § 182.30 Where does a Federal agency ■ 38. Revise § 182.670 to read as
■ 28. The authority citation for part 182 implement this part? follows:
continues to read as follows: Each Federal agency that awards
grants or cooperative agreements or § 182.670 Suspension.
Authority: 41 U.S.C. 8101–8106; 31 U.S.C.
503; 31 U.S.C. 6307. makes other financial assistance awards Suspension means an action taken by
that are subject to the drug-free a Federal agency that immediately
■ 29. Revise § 182.5 to read as follows:
workplace regulation in this part must prohibits a recipient from participating
§ 182.5 What does this part do? issue a regulation implementing the in Federal Government procurement
This part provides regulations policy within its chapter in subtitle B of contracts and covered nonprocurement
applicable to Federal agencies on the this title. transactions for a temporary period,
portion of the Drug-Free Workplace Act ■ 34. Revise § 182.40 to read as follows: pending completion of an investigation
of 1988 (41 U.S.C. 8101–8106, as and any judicial or administrative
§ 182.40 How is this part maintained? proceedings that may ensue. A recipient
amended) that applies to grants. It also
applies the provisions of the Act to The OMB publishes proposed changes so prohibited is suspended in
cooperative agreements and other to this part in the Federal Register for accordance with the Federal Acquisition
financial assistance awards, as a matter public comment, considers comments Regulation for procurement contracts
of Federal Government policy. with the help of appropriate interagency (48 CFR part 9, subpart 9.4) and Federal
■ 30. Revise § 182.15 to read as follows: working groups, and then issues any agency regulations implementing the
changes to this part in final form. OMB regulation on nonprocurement
§ 182.15 To whom does this part apply? ■ 35. In § 182.300, revise paragraph debarment and suspension (2 CFR part
This part provides regulations (b)(3) to read as follows: 180, which implements Executive
applicable to Federal agencies. Federal Orders 12549 and 12689). Suspension of
agencies’ implementation of this part § 182.300 What must I do to comply with a recipient is a distinct and separate
governs the rights and responsibilities of this part if I am an individual recipient? action from suspension of an award or
other persons affected by the drug-free * * * * * suspension of payments under an
workplace requirements. (b) * * * award.
■ 31. Revise § 182.20 to read as follows: (3) To the Federal agency awarding
official or their designee for each PART 183—NEVER CONTRACT WITH
§ 182.20 What must a Federal agency do to THE ENEMY
implement this part? Federal award that you currently have,
To comply with the requirement in 41 unless the agency designates a central
■ 39. The authority citation for part 183
U.S.C. 8106 for Government-wide point for the receipt of the notices,
continues to read as follows:
regulations, each Federal agency that either in the award document or its
regulation implementing the regulation Authority: Pub. L. 113–291, as amended
awards grants or cooperative agreements by Pub. L. 115–232, Pub. L. 116–92, Pub. L.
or makes other financial assistance in this part. When notice is made to a
116–283, Pub. L. 117–263; 31 U.S.C. 503; 31
awards that are subject to the drug-free central point, it must include the
U.S.C. 6307.
workplace requirements in subparts A identification number(s) of each affected
Federal award. ■ 40. Revise § 183.5 to read as follows:
through F of this part must issue a
regulation consistent with those ■ 36. In § 182.510, revise paragraph (c)
§ 183.5 Purpose of this part.
subparts. to read as follows:
■ 32. In § 182.25, revise paragraphs (a),
This part provides regulations
§ 182.510 What actions will the Federal applicable to Federal agencies on the
(b) introductory text, and (c) to read as Government take against a recipient
follows: implementation of the Never Contract
determined to have violated this part? with the Enemy requirements applicable
§ 182.25 What must a Federal agency * * * * * to certain grants and cooperative
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address in its implementation of this part? (c) Suspension or debarment of the agreements, as specified in subtitle E,
* * * * * recipient under the Federal agency’s title VIII of the National Defense
(a) Must establish drug-free workplace regulation implementing the OMB Authorization Act (NDAA) for Fiscal
policies and procedures for that Federal regulation on nonprocurement Year (FY) 2015 (Pub. L. 113–291), as
agency’s Federal awards consistent with debarment and suspension (2 CFR part amended by sec. 820 of the National
this part. When adopted by a Federal 180) for a period not to exceed five Defense Authorization Act for Fiscal
agency, this part has a regulatory effect years. Year 2023 (Pub. L. 117–263), hereinafter
on that Federal agency’s awards. Federal ■ 37. In § 182.630, revise the section to cited as ‘‘Never Contract with the
agencies must not deviate from the read as follows: Enemy’’.
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Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules 32245
■ 41. In § 183.35, revise the definition of any payment for an ineligible good or § 200.101 Applicability.
‘‘Covered combatant command’’ to read service; any duplicate payment; any * * * * *
as follows: payment for a good or service not (b) * * *
received, except for those payments (3) * * *
§ 183.35 Definitions. where authorized by law; any payment (ii) Section 200.216 (Prohibition of
* * * * * that is not authorized by law; and any certain equipment, services, and
Covered combatant command is payment that does not account for credit systems) applies to loans and grants (see
defined in Pub. L. 113–291. for applicable discounts. See OMB Pub. L. 115–232, Div. A, Title VIII, sec.
* * * * * Circular A–123 Appendix C, 889, as amended); and
Requirements for Payment Integrity * * * * *
PART 200—UNIFORM Improvement, for additional definitions (4) Subpart E (Cost Principles) applies
ADMINISTRATIVE REQUIREMENTS, and guidance on the requirements for to grants and cooperative agreements,
COST PRINCIPLES, AND AUDIT payment integrity. but does not apply to the following:
REQUIREMENTS FOR FEDERAL * * * * * (i) Food commodities provided
AWARDS through grants and cooperative
Notice of funding opportunity (NOFO)
■ 42. The authority citation for part 200 means a formal announcement of the agreements;
continues to read as follows: (ii) Agreements for loans, loan
availability of Federal funding through
guarantees, interest subsidies, and
Authority: 31 U.S.C. 503; 31 U.S.C. 6101– a financial assistance program from a
insurance; and
6106; 31 U.S.C. 6307; 31 U.S.C. 7501–7507. Federal agency. The notice of funding
(iii) Federal awards to hospitals (see
opportunity provides information on the
■ 43. In § 200.1: Appendix IX—Hospital Cost Principles).
award, such as who is eligible to apply, (5) * * *
■ a. Revise the definitions for
the evaluation criteria for selecting a (i) Grants and cooperative agreements;
‘‘Compliance supplement’’ and ‘‘Federal
recipient or subrecipient, the required
award date’’; * * * * *
components of an application, and how
■ b. Remove the definition for ‘‘Fixed (c) * * *
to submit the application. The notice of
amount award’’; (2) Cost-reimbursement contract
funding opportunity is any electronic
■ c. Revise the definitions of ‘‘Improper under the FAR awarded to a non-
issuance that an agency uses to
payment’’, ‘‘Notice of funding Federal entity. When a non-Federal
announce a funding opportunity,
opportunity’’, and ‘‘Personally entity is awarded a cost-reimbursement
whether it is called a ‘‘program
Identifiable Information (PII)’’; contract under the FAR, only subpart D,
announcement,’’ ‘‘notice of funding
■ d. Remove the definition for §§ 200.331 through 200.333, and
availability,’’ ‘‘broad agency
‘‘Protected Personally Identifiable subparts E and F are applicable. See 48
announcement,’’ ‘‘research
Information (Protected PII)’’; and CFR 16.301–2.
announcement,’’ ‘‘solicitation,’’ or some
■ e. Revise the definition of * * * * *
other term.
‘‘Unobligated balance’’. (d) Governing provisions in cases of
The revisions read as follows: * * * * *
conflict—(1) Statutory conflicts. With
Personally Identifiable Information the exception of subpart F, which is
§ 200.1 Definitions.
(PII) means information that can be used required by the Single Audit Act,
* * * * * to distinguish or trace an individual’s Federal statutes govern in any
Compliance supplement means an identity, either alone or when combined circumstances where they conflict with
authoritative source of information for with other personal or identifying the provisions of this part. For
auditors that identifies existing information that is linked or linkable to agreements with Indian Tribes, this
important compliance requirements that a specific individual. includes the provisions of the Indian
the Federal Government expects to be Self-Determination and Education and
* * * * *
considered as part of an audit. Auditors Assistance Act (ISDEAA), as amended
use it to understand the Federal Unobligated balance means the
amount of funds under a Federal award (see 25 U.S.C. 5301–5423).
program’s objectives, procedures, and (2) Regulatory conflicts. In the case of
compliance requirements, as well as that the recipient or subrecipient has
not obligated. For purposes of this a Federal regulation that conflicts with
audit objectives and suggested audit the provisions of this part but that is not
procedures for determining compliance definition, ‘‘obligated’’ means funds that
the recipient or subrecipient has legally required by a Federal statute, once a
with the relevant Federal program. Federal agency has issued regulations
* * * * * committed through actions such as
placing an order, awarding a contract or adopting the OMB regulations in this
Federal award date means the date part, the following provisions of this
when the authorized official of the subaward, or otherwise incurring a
liability for which payment will be due. part will govern in any circumstances
Federal agency: where they conflict with the other
(1) Signed (physically or digitally) the The amount of an unobligated balance
is computed by subtracting the regulatory provision: all sections in
Federal award; or subpart F and § 200.340 in subpart D.
(2) Obligated the Federal award by cumulative amount of the recipient’s or
subrecipient’s unliquidated financial See also § 200.106(a) regarding the
alternative means consistent with the process for issuing codified exceptions
obligations and expenditures under the
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requirements of 31 U.S.C. 1501. under this title. For other non-statutory
Federal award from the cumulative
* * * * * amount of funds the Federal agency or conflicts involving a policy in a Federal
Improper payment means a payment pass-through entity authorized the regulation, once a Federal agency has
that should not have been made or that recipient or subrecipient to obligate. issued regulations adopting the OMB
was made in an incorrect amount under regulations in this part, the Federal
statutory, contractual, administrative, or * * * * * agency should apply the Government-
other legally applicable requirements. ■ 44. In § 200.101, revise paragraphs wide policies in this part to the greatest
The term improper payment includes: (b)(3)(ii), (b)(4), (b)(5)(i), (c)(2), (d), and extent permitted by law. If a Federal
any payment to an ineligible recipient; (f) introductory text to read as follows: agency is aware of regulatory conflicts
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32246 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
that could potentially affect activities different provisions are required by conflict of interest to the Federal agency
under a Federal program or Federal Federal statute or are approved by OMB. or pass-through entity in accordance
award, the agency should clarify which (b) Agency responsibilities. Through with the established Federal agency
provisions govern in funding adoption of this part in codified policies. A recipient or subrecipient
opportunities and Federal award regulations, unless different provisions must also disclose whether any
documents. Unless prohibited by are required by Federal statute or are employees who worked on an
statute, as a default presumption, a approved by OMB, Federal agencies are application for, or proposal in support
Federal agency should generally apply responsible for implementing: of, a resulting Federal award, or are
the government-wide policies in this (1) The language in subparts A anticipated to work on activities under
part if it can do so consistent with law. through F of this part; and the Federal award, were employed by
Federal agencies should work to resolve (2) Other applicable requirements for the awarding Federal agency during the
any such regulatory conflicts consistent Federal awards in parts 25, 170, 175, preceding two years prior to application
with their rulemaking authorities; 180, 182, 183, and 184 of chapter I of submission. This disclosure must be
applicable provisions of this part, such this subtitle. provided to agencies for informational
as §§ 200.102, 200.106, and 200.110; or ■ 47. Revise § 200.108 to read as purposes.
both. follows: ■ 51. Revise § 200.113 to read as
* * * * * follows:
§ 200.108 Inquiries.
(f) Additional program applicability. § 200.113 Mandatory disclosures.
Inquiries from Federal agencies
Except for §§ 200.203 and 200.216, the An applicant, recipient, or
concerning this part may be directed to
regulation in subpart C does not apply subrecipient of a Federal award must
OMB. Inquiries from recipients or
to the following programs: promptly disclose whenever, in
subrecipients should be addressed to
* * * * * the Federal agency, the cognizant connection with the Federal award
■ 45. In § 200.102, revise paragraphs (b) agency for indirect costs, the cognizant (including any activities or subawards
and (c) to read as follows: agency for audit, or the pass-through thereunder), it has credible evidence of
§ 200.102 Exceptions.
entity, as appropriate. the commission of a violation of Federal
■ 48. In § 200.110, revise paragraph (a) criminal law involving fraud, conflict of
* * * * * to read as follows: interest, bribery, or gratuity violations
(b) Statutory and regulatory found in title 18 of the United States
exceptions. Except for subpart F of this § 200.110 Effective date. Code or a violation of the Federal civil
part, and subject to § 200.101(d), a (a) The Government-wide standards False Claims Act (31 U.S.C. 3729–3733).
Federal agency may adjust requirements set forth in this part affecting the The disclosure must be made in writing
applicable to a class of Federal awards, administration of Federal awards by to the Federal agency, the agency’s
recipients, or subrecipients when Federal agencies become effective once Office of Inspector General, and pass-
required by Federal statutes or implemented by Federal agencies or through entity (if applicable). Recipients
regulations. Except for provisions in when any future amendment to this part and subrecipients are also required to
subpart F, when a Federal statute becomes final. Thus, once Federal report matters related to recipient
requires exceptions to requirements of agencies have issued regulations in integrity and performance in accordance
this part for a class of Federal awards, subtitle B of this title adopting the OMB with appendix XII to this part. Failure
recipients, or subrecipients, a Federal regulations in this part, the process for to make required disclosures can result
agency does not need OMB approval to future updates of regulations in subtitle in any of the administrative actions
allow those exceptions. See also B will be complete each time OMB described in § 200.339. (See also 2 CFR
§ 200.106. issues a final rule amending this part. If part 180, 31 U.S.C. 3354, and 41 U.S.C.
(c) Federal agency exceptions. Federal required by Federal statute or otherwise 2313.) Any such disclosures made to the
agencies may allow exceptions to approved by OMB, Federal agencies agency’s office of Inspector General
requirements of this part on a case-by- remain permitted to amend their must be transmitted to the United States
case basis for individual Federal regulations in subtitle B to make agency- Attorney’s Office for the District of
awards, recipients, or subrecipients, specific additions, clarifications, or Columbia within ten days of receipt.
except when the exceptions are exceptions to the Government-wide ■ 52. Revise § 200.201 to read as
prohibited by law or other approval is policies and procedures in this part. See follows:
expressly required by this part. See, for § 200.106(a).
example, § 200.340. Only the cognizant § 200.201 Use of grants, cooperative
* * * * *
agency for indirect costs may authorize agreements, and contracts.
■ 49. Revise § 200.111 to read as
exceptions related to cost allocation follows: (a) Federal awards. The Federal
plans or indirect cost rate proposals. agency must decide on the appropriate
■ 46. Revise § 200.106 to read as § 200.111 English language. type of agreement for a Federal award
follows: All Federal financial assistance (for example, a grant, cooperative
announcements, applications, and agreement, or contract) in accordance
§ 200.106 Agency implementation and Federal award information must be in with this regulation. See the Federal
responsibilities. Grant and Cooperative Agreement Act
the English language and must be in
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(a) Agency implementation of this terms of U.S. dollars. (31 U.S.C. 6301–6309). See § 200.332 for
part. The specific requirements and ■ 50. Revise § 200.112 to read as information applicable to pass-through
responsibilities of Federal agencies, follows: entities.
non-Federal entities, recipients, and (b) Fixed amount awards. Fixed
subrecipients are set forth in this part. § 200.112 Conflict of interest. amount awards are not permitted unless
Federal agencies making Federal awards Federal agencies must establish otherwise authorized by Federal statute.
to non-Federal entities must implement conflict of interest policies for Federal The term fixed amount award means a
the language in subparts A through F of awards. A recipient or subrecipient type of grant or cooperative agreement
this part in codified regulations unless must disclose in writing any potential in which the Federal agency or pass-
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Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules 32247
through entity provides a specific (d) Eligibility of nonprofit (iii) The likelihood that the proposed
amount of funding without regard to organizations. To the extent permitted international element will enhance the
actual costs incurred under the Federal by law, when a Federal agency scientific enterprise of the United
award. See also § 200.333 regarding determines it is necessary to restrict States, including through the
fixed amount subawards, which also are eligibility among different types of development of new knowledge,
not permitted. nonprofit organizations, the notice of methodologies, technologies, or
■ 53. In § 200.202: funding opportunity must specify the collaborative networks that can be
■ a. Revise paragraphs (a) introductory applicable Internal Revenue Code applied domestically.
text, (a)(1), and (b); and designation for eligible nonprofit (iv) The adequacy of the facilities,
■ b. Add paragraphs (c) through (g). organizations (for example, 501(c)(3) equipment, personnel, and
The revisions and additions read as organizations) and expressly state that administrative capacity at the
follows: other types of nonprofit organizations international site, or of any foreign
§ 200.202 Program planning and design. not specifically identified are ineligible entities that would perform work, to
(a) Elements of program design. The (for example, 501(c)(4) organizations). carry out the proposed scope of work
Federal agency must design a Federal When eligibility is restricted among under the Federal award at a level
program and create an Assistance different types of nonprofit comparable to that of a domestic
Listing before announcing the Notice of organizations, the Federal agency is not recipient performing similar activities.
Funding Opportunity. A Federal required to list every type of ineligible (4) Nothing in this paragraph (e)
program must be designed: organization, but should ensure that prohibits the participation of foreign
(1) With clear goals and objectives eligibility information is sufficiently entities as subrecipients or contractors
that: clear for prospective applicants. Federal under a research and development
(i) Aim to achieve meaningful results; agencies should consider exercising award made to an eligible U.S. entity.
(ii) Are consistent with the public such discretion when warranted by (5) For the purposes of this section,
purpose of the program as authorized by statute, program objectives, or risk international elements may include
law; and considerations. performance of activities under the
(iii) Align with administration (e) Eligibility of entities for research Federal award outside of the United
policies and priorities; and development awards. (1) To the States or by a foreign entity.
* * * * * extent permitted by law, Federal awards (f) Multi-year awards. When
(b) Other considerations. Federal for research and development must be consistent with program objectives, and
agencies should develop Federal made to entities that are organized subject to restrictions in law, Federal
programs in consultation with under the laws of the United States, a agencies are encouraged to design
communities benefiting from or State, or Tribal government. Federal Federal programs to allow for multi-year
impacted by the program. In addition, agencies may not issue Federal awards awards with budget periods longer than
Federal agencies should consider for research and development to foreign one year, rather than issuing separate
available data, evidence, and evaluation entities except where expressly notices of funding opportunities on an
results from past programs and make authorized by statute or where a annual basis. Such Federal awards must
every effort to extend eligibility compelling interest exists for the be designed to comply with all
requirements to all potential applicants. agency’s mission, the administration’s applicable funding limitations and must
Federal agencies are encouraged to priorities, and for the United States, as not be administered in a manner that
coordinate with other agencies during determined by the agency’s senior would result in a violation of the
program planning and design, appointee. Antideficiency Act.
particularly when the goals and (2) When designing research and (g) Awards for scientific research.
objectives of a program or project align development programs, and evaluating Federal agencies that issue Federal
with those of other agencies. applications, Federal agencies must financial assistance for scientific
(c) Limitations on authorized use of apply a domestic-first framework, under research must categorize those awards
Federal program funds. Federal agencies which international elements may be as basic research, applied research, and
must develop Federal programs and included only if the Federal agency experimental development consistent
implement activities under those determines that such elements are with the definitions in OMB Circular A–
programs in a manner that ensures justified, consistent with program 11. This categorization must be
compliance with all applicable objectives, and in the national interest communicated to the recipient and
restrictions on the use of Federal funds, of the United States. included in the terms and conditions of
including ensuring that Federal program (3) Federal agencies should consider, the Federal award. See § 200.211(d).
funds are only used for public purposes as applicable, the following factors ■ 54. Revise § 200.204 to read as
of support authorized by law. For when determining whether an follows:
example, Federal agencies must ensure international element is warranted:
that Federal program funds are not used (i) The extent to which the proposed § 200.204 Notices of funding
to promote, subsidize, or support international element is necessary to opportunities.
political activities or initiatives achieve the scientific or technical (a) In general. The Federal agency
unrelated to authorized public objectives of the project and is integral must publicly announce funding
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purposes, such as political advocacy, to the scientific rationale of the opportunities for all discretionary
lobbying, or any attempt to influence program. awards. As appropriate and consistent
legislation, elections, or government (ii) The extent to which the with authorizing law, funding
officials. Federal programs should be international element provides access to opportunities may allow for open
developed to avoid even the appearance unique expertise, facilities, data, study competition, limited competition, or
of supporting such prohibited activities populations, environmental conditions, selection on a non-competitive basis.
to ensure that all activities performed or other resources that are not See the definition of discretionary
under Federal awards are authorized by reasonably available within the United award in § 200.1. In developing notices
law. States. of funding opportunities (NOFOs) for
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32248 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
discretionary awards, Federal agencies applicants that are invited to submit a the head of the Federal agency (or their
must: full proposal based on their SOI. The designee); and
(1) Post the NOFO on Grants.gov. A purpose of an SOI is to reduce burden (9) Agency contact information.
Federal agency head (or designee) may on applicants by avoiding the (e) Availability period. The Federal
approve exceptions to this requirement preparation of lengthy proposals while agency should make all funding
when the agency determines that also assisting Federal agencies in opportunities available for application
publicly announcing an opportunity identifying the most competitive for at least 60 calendar days. However,
would pose a risk to national security or applicants early in the process. the Federal agency may modify the
is in the national interest of the United (d) Summary information in notices of availability period of an opportunity if
States. The Federal agency may either funding opportunities. The Federal needed. For example, extending the
post the entire notice or a link to the agency must display the following period may be necessary to provide
entire notice; information on Grants.gov or other technical assistance to an applicant pool
(2) Require applicants to apply using system authorized by Federal statute or that was not anticipated when the
Grants.gov, unless a program specific approved by the Federal agency head (or announcement was made or has less
exception is expressly authorized by designee), in a location preceding the experience with applying for Federal
Federal statute or approved by the full text of the announcement: financial assistance. The Federal agency
Federal agency head (or designee); (1) Federal Agency Name; may also determine that an availability
(3) Write the NOFO in plain language. period of less than 60 days is sufficient
(2) Funding Opportunity Title;
The Federal agency must make efforts to for a particular funding opportunity.
(3) Announcement Type (whether the
limit the length and complexity of the However, no funding opportunity will
funding opportunity is the initial
NOFO and only include the information be available for less than 30 calendar
announcement or a modification of a
necessary for the effective days unless the Federal agency
previously announced opportunity);
communication of the program determines that exigent circumstances
objectives. The Federal agency must not (4) Funding Opportunity Number
(required, if the Federal agency has justify this and includes this
require the applicant to employ justification in the funding opportunity.
technical or legal consultants to assigned a number to the funding
opportunity announcement); (f) Full text of notices of funding
complete an application in response to opportunities. (1) The Federal agency
the NOFO. A NOFO should be drafted (5) Assistance Listing Number(s);
(6) Funding Details. To the extent must include the information in
to reasonably allow for all applicants to appendix I for every NOFO. (2) Federal
compete and succeed against appropriate, the total amount of funding
that the Federal agency expects to agencies must write NOFOs in plain
institutions that have historically language. To the extent possible Federal
received consecutive awards in prior award, the anticipated number of
awards, and the expected dollar values agencies must streamline opportunities
years; to make them accessible, particularly for
(4) Follow the policy in § 200.111; of individual awards, which may be a
range or average; funding opportunities that are new, or
and intended to reach inexperienced
(5) Make every effort to identify all (7) Key Dates. Key dates include due
dates for submitting applications or applicants. Federal agencies, when
eligible applicants in the notice. feasible, should strive to ensure that
(b) Pre-application technical Executive Order 12372 submissions, as
well as for any letters of intent or SOI NOFOs are accessible to a broad range
assistance. Federal agencies may offer
submissions. For any announcement of applicants, including those that have
pre-application technical assistance or
issued before a program’s application not previously received Federal awards.
provide clarifying information for
materials are available, key dates also OMB will periodically analyze
funding opportunities. However,
include the date on which those recipients of Federal awards. Federal
Federal agencies must ensure these
materials will be released; and any other agencies may be required to submit a
resources are made accessible and
additional information, as deemed report to OMB detailing the specific
widely available to all potential
applicable by the Federal agency. For recipients or types of recipients that
applicants (for example, by posting
opportunities that require the received Federal awards from the
answers to questions and requests on
submission of a SOI, the Federal agency Federal agency over a specific time
Grants.gov).
must provide a date by which it will period.
(c) Statement of Interest (SOI). When
(3) To reduce application burden,
a Federal agency anticipates receiving a inform selected applicants to submit a
Federal agencies should consider
large volume of applications, or where full proposal. For all opportunities, if
whether programmatic or administrative
proposals are expected to be long and possible, the Federal agency should
requirements specific to the agency,
complex, the agency is strongly provide an anticipated award date. If the
program, or funding opportunity must
encouraged to request a Statement of notice of funding opportunity states that
be met at the time of application or as
Interest (SOI) as part of the notice of applications will be evaluated on a
a requirement of receiving a Federal
funding opportunity. A SOI is a short ‘‘rolling’’ basis (that is, at different
award.
pre-application submission, typically no points during a specified period of ■ 55. Revise § 200.205 to read as
more than a few pages, that allows time), the Federal agency should follows:
applicants to summarize their project provide an estimate of the time needed
concept, objectives, and anticipated to process an application and notify the § 200.205 Federal agency merit review of
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approach. Following submission of applicant of the Federal agency’s proposals.
SOIs, the Federal agency must review decision; (a) In general. Unless prohibited by
SOI proposals in accordance with (8) Executive Summary. A brief Federal statute, the Federal agency must
§ 200.205 to determine which applicants description that is written in plain design and execute a merit review
will be invited to submit full proposals. language and summarizes the goals and process of applications for all
When utilizing a SOI process, Federal objectives of the program, the target discretionary awards. See the definition
agencies must not compare any SOI audience, and eligible applicants. The of discretionary award in § 200.1. The
submission against a full proposal, and text of the executive summary must not objective of a merit review process is to
may only review full proposals from exceed 500 words, unless authorized by select recipients most likely to be
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Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules 32249
successful in delivering results based on results, in a manner consistent with the conducting a risk assessment to evaluate
the program objectives as outlined in notice of funding opportunity. the risks posed by applicants before
§ 200.202. A merit review is an objective (5) In performing activities under issuing Federal awards. This assessment
process of evaluating Federal award Federal awards, applicants should helps identify risks that may affect the
applications in accordance with the commit to complying with advancement toward or the achievement
written standards of the Federal agency. administration policies, procedures, and of a project’s goals and objectives. Risk
These standards should identify the guidance respecting Gold Standard assessments assist Federal managers in
number of people the agency requires to Science. determining appropriate resources and
participate in the merit review process. (6) Discretionary awards should time to devote to project oversight and
The merit review process explained in include benchmarks for measuring monitor recipient progress. This
this section, including the pre-issuance success and progress towards relevant assessment should be conducted no
review described in paragraph (b) of this goals and, as relevant for awards earlier than 30 days before the award
section, must be described or pertaining to scientific research, a decision and may incorporate elements
incorporated by reference in the commitment to achieving Gold Standard such as the quality of the application,
applicable NOFO. The pre-issuance Science. See also § 200.202(a). award amount, risk associated with the
review described in paragraph (b) may (7) To the extent institutional program, cybersecurity, and fraud risks.
form the basis of a decision not to select affiliation is considered in making If the Federal agency determines that
an applicant to receive a Federal award. discretionary awards, agencies should the Federal award will be made, specific
See § 200.204 and appendix I to this prioritize an institution’s commitment conditions that address the assessed risk
part. The Federal agency must also to rigorous, reproducible scholarship may be implemented in the Federal
periodically review its merit review over its historical reputation or award. The risk criteria to be evaluated
process. perceived prestige. For science grants, must be described in the announcement
(b) Pre-issuance review. As part of the agencies should prioritize institutions of the funding opportunity described in
merit review process, Federal agencies that have demonstrated success in § 200.204.
must perform pre-issuance reviews to implementing Gold Standard Science. (2) Items for consideration. In
ensure that Federal award proposals (8) See also §§ 200.202(c) and evaluating risks posed by applicants, the
selected for funding are consistent with 200.300. Federal agency should consider the
applicable law, Federal agency (c) Procedure for pre-issuance review. following items:
priorities, and the national interest. In When conducting a pre-issuance review, (i) Financial stability. The applicant’s
doing so, Federal agencies heads must senior appointees (or their designee) record of effectively managing financial
designate one or more senior appointees must not ministerially ratify or routinely risks, assets, and resources;
to conduct a pre-issuance review of all defer to the recommendations of others, (ii) Financial capacity. The
discretionary awards. As part of this but must instead use their independent applicant’s ability to manage and
pre-issuance review for discretionary judgment when evaluating Federal oversee high-dollar awards, especially
awards, senior appointees (or their award proposals. those that are in excess of awards the
designee) must, as relevant and to the (d) Use of peer review. Nothing in this applicant typically implements, as
extent consistent with applicable law, part must be construed to discourage or determined by the Federal agency;
apply the following principles when prevent the use of peer review methods (iii) Management systems and
reviewing Federal award proposals: to evaluate proposals for discretionary standards. Quality of management
(1) Discretionary awards must, where awards or otherwise inform agency systems and ability to meet the
applicable, demonstrably advance the decision making, provided that peer management standards prescribed in
President’s policy priorities. review recommendations remain this part;
(2) Discretionary awards must not be advisory and are not ministerially (iv) History of performance. The
used to fund, promote, encourage, ratified, routinely deferred to, or applicant’s record of managing previous
subsidize, or facilitate: otherwise treated as de facto binding by and current Federal awards, including
(i) Racial preferences or other forms of senior appointees or their designees. compliance with reporting requirements
racial discrimination by the recipient, Further, nothing in this part must be and conformance to the terms and
including activities where race or construed to create any rights to any conditions of Federal awards. If prior
intentional proxies for race will be used particular level of review or performance is considered, it should be
as a selection criterion for employment consideration for any funding applicant evaluated solely on the outcomes of
or program participation; except as consistent with applicable prior work, with both positive and
(ii) Denial by the recipient of the sex law. negative outcomes measured against the
binary in humans or the notion that sex (e) Agency discretion to reissue goals of the funding opportunity and
is a chosen or mutable characteristic; funding opportunities. A Federal agency given equal weight, if applicable;
(iii) Illegal immigration; or is not required to issue a discretionary (v) Audit reports and findings.
(iv) Any other initiatives that award as a result of a NOFO if doing so Reports and findings from audits
compromise public safety or promote would fund low-quality proposals or be performed under subpart F of this part
anti-American values. inconsistent with the principles of this or the reports and findings of any other
(3) All else being equal, preference for part. The agency may, at its discretion, available audits, if applicable;
discretionary awards should be given to repost a funding opportunity. (vi) Ability to effectively implement
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institutions with lower indirect cost ■ 56. In § 200.206, revise paragraphs (b) requirements. The applicant’s ability to
rates. and (d) to read as follows: effectively implement statutory,
(4) Discretionary awards should be regulatory, or other requirements
given to a broad range of recipients. § 200.206 Federal agency review of risk imposed on recipients of Federal
Research grants should be awarded to a posed by applicants. awards;
mix of recipients likely to produce * * * * * (vii) History of questionable practices.
immediately demonstrable results and (b) Risk assessment—(1) In general. Based on publicly available and
recipients with the potential for The Federal agency must establish and verifiable information, the applicant’s
potentially longer-term, breakthrough maintain policies and procedures for record of:
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32250 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
(A) Plagiarism in studies or papers § 200.208 Specific conditions. (5) Requiring the recipient or
published by the applicant or its staff; (a) In general. Federal agencies are subrecipient to obtain technical or
(B) Discredited or non-replicable responsible for ensuring that specific management assistance; or
studies published by the applicant or its Federal award conditions and (6) Establishing additional prior
staff; performance expectations for Federal approvals.
(C) Engaging in activities or initiatives awards are consistent with the program (e) Notification. Prior to imposing
that are inconsistent with Federal civil design (see §§ 200.202 and 200.301). specific conditions, the Federal agency
rights laws, including the equal (b) Adjustment of specific conditions. or pass-through entity must notify the
protection principles of the U.S. (1) To the extent permitted by law, recipient or subrecipient as to:
Constitution and prohibitions against based on consideration of the factors (1) The nature of the specific
unlawful discrimination; or listed in paragraph (c) of this section, condition(s);
the Federal agency may: (2) The reason why the specific
(D) Engaging in activities or initiatives condition(s) is being imposed;
that are inconsistent with religious (i) Add specific conditions when a
Federal award is made; and, (3) The nature of the action needed to
liberty laws. remove the specific condition(s);
(ii) Add or remove specific conditions
(viii) Memberships and affiliations. (4) The time allowed for completing
throughout the period of performance.
Based on publicly available and the actions; and
(2) The addition or removal of specific
verifiable information, the applicant’s (5) The method for requesting the
conditions for existing Federal awards
membership in or affiliation with Federal agency or pass-through entity to
based on consideration of the factors
organizations engaged in activities that reconsider imposing a specific
listed in paragraph (c) of this section
violate Federal law, undermine public condition.
must occur within 15 calendar days
safety or national security, or advocate (f) Program-level specific conditions.
after the Federal agency’s determination
for the overthrow of the United States Notwithstanding any other provision of
to adjust the conditions. Specific
Government; and this section, the Federal agency may
conditions not based on factors in
(ix) Foreign gift and contract paragraph (c) may be added or removed include program-level specific Federal
reporting. As applicable, the applicant’s during the period of performance only award conditions, including any of the
compliance with foreign gift and with the agreement of the recipient. specific conditions described in
contract disclosure requirements under (c) Factors for consideration. The paragraph (d) of this section, in any
section 117 of the Higher Education Act Federal agency or pass-through entity Federal award made under a Federal
of 1965 (Pub. L. 89–329, as amended, may adjust specific conditions in the program that the Federal agency
codified at 20 U.S.C. 1011f). Federal award based on an analysis of determines presents elevated
* * * * * the following factors: programmatic risk related to program
(d) Suspension and debarment (1) Review of OMB-designated administration, program oversight, or
compliance. The Federal agency must repositories of Government-wide data effective monitoring of the use or
comply with the Government-wide (for example, SAM.gov) or review of its expenditure of Federal funds by
suspension and debarment regulation in risk assessment (see § 200.206); recipients or subrecipients. Federal
2 CFR part 180 and individual Federal (2) The recipient’s or subrecipient’s agencies are responsible for ensuring
agency suspension and debarment history of compliance with the terms that program-level specific Federal
requirements in title 2 of the Code of and conditions of Federal awards, award conditions and performance
Federal Regulations. Federal agencies including the Federal award the Federal expectations are consistent with the
must also require recipients to comply agency is adjusting (see also § 200.339); program design (see §§ 200.202 and
with these requirements. These (3) The recipient’s or subrecipient’s 200.301) and applicable law. The
requirements restrict making Federal ability to meet expected performance Federal agency may remove program-
awards, subawards, and contracts with goals as described in § 200.211; or level specific conditions if it determines
certain parties that are debarred, (4) A determination of whether a that the Federal program no longer
suspended, or otherwise excluded from recipient or subrecipient has inadequate presents elevated programmatic risk.
receiving Federal awards or ■ 59. In § 200.211:
financial capability to perform the
■ a. Revise paragraphs (b)(15) and (16)
participating in Federal awards. Federal award.
and (c)(1)(v);
■ 57. In § 200.207, add paragraph (c) to (d) Examples of specific conditions.
■ b. Remove paragraph (c)(3); and
read as follows: Specific conditions may include the ■ c. Redesignate paragraph (c)(4) as
following: paragraph (c)(3).
§ 200.207 Standard application (1) Requiring payments as
requirements. The revisions read as follows:
reimbursements rather than advance
* * * * * payments; § 200.211 Information contained in a
(c) Reducing administrative and (2) Withholding authority to proceed Federal award.
regulatory burden. Federal agencies that to the next phase until receipt of * * * * *
issue Federal financial assistance must evidence of acceptable performance; (b) * * *
periodically review programmatic and (3) Requiring additional or more (15) Identification of whether the
administrative requirements specific to detailed financial reports, which may Award is Research and Development
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the agency, program, or award(s) to include requiring information on (R&D) (see also § 200.202(g)); and
determine whether such requirements payments to subrecipients, contractors (16) Indirect cost rate for the Federal
are unnecessary and not required by this and vendors; award (including if the de minimis rate
part or applicable law. Federal agencies (4) Requiring additional project is charged per § 200.414).
should update OMB annually on any monitoring, which may include (c) * * *
such requirements that have been financial integrity-related site visits (1) * * *
removed. with the goal of improving the financial (v) Termination provisions. Federal
■ 58. Revise § 200.208 to read as integrity of the program or recipient agencies must inform recipients of the
follows: organization; termination provisions in § 200.340.
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Except as provided in § 200.340(b), the § 200.216 Prohibition of certain equipment, services’’ also include systems that use
Federal agency must always include the services, and systems. covered telecommunications equipment
termination provisions set forth in (a) Prohibition of certain or services as a substantial or essential
§ 200.340(a)(1) through (4) in each telecommunications and video component of any system, or as critical
Federal award or expressly incorporate surveillance equipment or services. technology as part of any system.
them by reference. Pursuant to Pursuant to section 889 of Public Law (4) Certification. When the recipient
§ 200.340(a)(5), if applicable, the 115–232, the following prohibition or subrecipient accepts a loan or grant,
Federal agency must also inform applies to certain telecommunications it is certifying that it will comply with
recipients of any additional termination and video surveillance equipment or the prohibition on prohibited
provisions that apply to a Federal services. telecommunications equipment and
award, including any applicable (1) General prohibition. Recipients services in this section. The recipient or
termination provisions in the Federal and subrecipients are prohibited from subrecipient is not required to certify
agency’s regulations. Subject to the obligating or expending loan or grant that funds will not be expended on
limitations in § 200.340(b), such funds to: prohibited telecommunications
(i) Procure or obtain prohibited equipment or services beyond the
additional provisions must not limit the
telecommunications equipment or certification provided upon accepting
right of the Federal agency to terminate
services; the loan or grant and those provided
for any of the reasons in § 200.340(a)(1) (ii) Extend or renew a contract to
through (4). upon submitting payment requests and
procure or obtain prohibited financial reports.
* * * * * telecommunications equipment or (5) Additional information. For
■ 60. In § 200.213, revise paragraph (e) services; or additional information, see section 889
to read as follows: (iii) Enter into a contract (or extend or of Public Law 115–232 and § 200.471.
renew a contract) to procure or obtain
(b) Prohibition of procurement and
§ 200.213 Reporting a determination that prohibited telecommunications
an applicant is not qualified for a Federal
operation of prohibited unmanned
equipment or services.
award. aircraft systems. Pursuant to section
(2) Definition of prohibited
1825 of the American Security Drone
* * * * * telecommunications equipment or
Act of 2023 (Pub. L. 118–31), on or after
services. As described in section 889 of
(e) Federal agencies must not post any December 22, 2025, the following
Public Law 115–232, prohibited
information that will be made publicly prohibition restricts the extent to which
telecommunications equipment or
available in the non-public segment of funds provided through a Federal grant
services (referred to in the statute as
the responsibility and qualification or cooperative agreement, or otherwise
‘‘covered telecommunications
records that is covered by a disclosure made available, may be used by a
equipment or services’’) means any of
exemption under the Freedom of recipient or subrecipient for
the following:
Information Act. If a recipient asserts (i) Telecommunications equipment procurement and operation of Federal
within seven calendar days to a Federal produced by Huawei Technologies Acquisition Security Council (FASC)-
agency that some or all of the publicly Company or ZTE Corporation (or any prohibited unmanned aircraft systems.
available information is covered by a subsidiary or affiliate of such entities); This prohibition applies to all Federal
disclosure exemption under the (ii) For the purpose of public safety, awards, regardless of whether the FASC-
Freedom of Information Act (5 U.S.C. security of Government facilities, prohibited unmanned aircraft system to
552), the Federal agency that posted the physical security surveillance of critical be acquired or operated will process,
information must remove the posting infrastructure, and other national store, or transmit Federal information.
within seven calendar days of receiving security purposes, video surveillance (1) Definitions. The terms ‘‘FASC-
the assertion. Prior to reposting the and telecommunications equipment prohibited unmanned aircraft system’’
releasable information, the Federal produced by Hytera Communications and ‘‘unmanned aircraft system’’ have
agency must resolve the issue in Corporation, Hangzhou Hikvision the definitions provided in 48 CFR
accordance with the agency’s Freedom Digital Technology Company, or Dahua 40.201.
of Information Act procedures. Technology Company (or any subsidiary (2) General prohibition. On or after
■ 61. Revise § 200.215 to read as or affiliate of such entities); December 22, 2025, except as provided
follows: (iii) Telecommunications or video in paragraphs (b)(3) through (6) of this
surveillance services provided by such section, no Federal funds awarded
§ 200.215 Never contract with the enemy. entities or using such equipment; and through a grant or cooperative
(iv) Telecommunications or video agreement, or otherwise made available,
Federal agencies, recipients, and may be used by a recipient or
surveillance equipment or services
subrecipients are subject to the subrecipient:
produced or provided by an entity that
regulation implementing Never Contract (i) To procure a FASC-prohibited
the Secretary of Defense, in consultation
with the Enemy in 2 CFR part 183. The unmanned aircraft system; or
with the Director of the National
regulation in 2 CFR part 183 affects (ii) In connection with the operation
Intelligence or the Director of the
covered contracts, grants, and of such a FASC-prohibited unmanned
Federal Bureau of Investigation,
cooperative agreements that are aircraft system.
reasonably believes to be an entity
expected to exceed $50,000 during the
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owned or controlled by, or otherwise (3) Department of Homeland Security,
period of performance, are performed connected to, the government of a Department of Defense, Department of
outside the United States and its covered foreign country, as defined in State, and the Department of Justice
territories, and are in support of a section 889 of Public Law 115–232. exemptions. (i) The Secretary of
contingency operation in which (3) Inclusion in definition of Homeland Security, the Secretary of
members of the Armed Forces are prohibited telecommunications Defense, the Secretary of State, and the
actively engaged in hostilities. equipment or services. For the purposes Attorney General are exempt from the
■ 62. Revise § 200.216 to read as of this section, ‘‘covered restriction under paragraph (b)(2) of this
follows: telecommunications equipment or section if the procurement or operation
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32252 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
is required in the national interest of the paragraph (b)(2) of this section on a assistance to ensure alignment with this
United States and: case-by-case basis: paragraph (c).
(A) Is for the sole purposes of (i) With the approval of the Director (d) Exception for analysis for internal
research, evaluation, training, testing, or of the Office of Management and use. Nothing in this section prohibits a
analysis for electronic warfare, Budget, after consultation with the recipient or subrecipient from
information warfare operations, Federal Acquisition Security Council; conducting statistical or demographic
cybersecurity, or development of and analysis for internal program evaluation,
unmanned aircraft system or counter- (ii) Upon notification to: research, or other purposes, provided
unmanned aircraft system technology; (A) The Committee on Homeland that Federal award funds are not used
(B) Is for the sole purposes of Security and Governmental Affairs of for conducting such analysis, and the
conducting counterterrorism or the Senate; results of such analysis are not used in
(B) The Committee on Oversight and connection with or applied to activities
counterintelligence activities, protective
Accountability in the House of under the Federal award, such as:
missions, or Federal criminal or
Representatives; and (1) Treating individuals unequally
national security investigations, (C) Other appropriate congressional
including forensic examinations, or for based on federally protected
committees of jurisdiction. characteristics, such as race or sex,
electronic warfare, information warfare ■ 63. Add § 200.218 to read as follows:
operations, cybersecurity, or regardless of individual strengths, effort,
development of an unmanned aircraft § 200.218 Prohibition of using Federal or achievement; or
system or counter-unmanned aircraft awards to promote or support theories of (2) Adjusting activities or
system technology; or disparate-impact liability. performance under the Federal award
(C) Is an unmanned aircraft system (a) General prohibition. To the based on theories, or the assumed risk
that, as procured or as modified after maximum extent permitted by law, of, disparate-impact liability.
procurement but before operational use, Federal agencies must eliminate the use (e) Definition of disparate-impact
can no longer transfer to, or download of disparate-impact liability in all liability. For the purposes of this
data from, a covered foreign entity and contexts relevant to Federal awards. section, disparate-impact liability
otherwise poses no national security Disparate-impact liability imperils the means a theory under which a facially
cybersecurity risks as determined by the effectiveness of civil rights laws by neutral policy or practice (for example,
exempting official. mandating, rather than proscribing, a merit-based employment policy or
(ii) The Secretary of Homeland discrimination. practice) gives rise to an automatic or
Security, the Secretary of Defense, the (b) Federal agency and pass-through near-insurmountable presumption of the
Secretary of State, and the Attorney entity responsibilities. To the maximum existence of unlawful discrimination on
General must notify OMB within five extent permitted by law, to avoid the basis of federally protected
calendar days of issuing an award with violating the Constitution and Federal characteristics (such as race or sex)
exemptions to paragraph (b)(3)(i) of this civil rights laws, the Federal agency or where there are any differences or
section). pass-through entity must: disparities in outcomes (for example,
(1) Ensure that Federal awards are disproportionate effects) among
(4) Department of Transportation
administered in a way that does not different races, sexes, or similar groups.
exemption. The Secretary of
promote or support the use of disparate- Under a theory of disparate-impact
Transportation is exempt from the
impact liability. This includes ensuring, liability, this presumption would apply
restriction under paragraph (b)(2) of this
unless expressly required by law, that even if there is no facially
section if the operation or procurement
Federal awards are not used in support discriminatory policy or practice, there
is deemed to support the safe, secure, or
of disparate-impact studies, disparate- is no discriminatory intent involved,
efficient operation of the National
impact litigation, or other related and equal opportunity is provided.
Airspace System or maintenance of
activities; and that Federal award Discriminatory intent is irrelevant in a
public safety, including activities
activities based on the assumed risk of disparate-impact claim. Disparate-
carried out under the Federal Aviation
disparate-impact liability are not impact liability effectively mandates
Administration’s Alliance for System
allowed; consideration of federally protected
Safety of UAS through Research (2) Not adopt, issue, or enforce terms characteristics, such as race or sex, and
Excellence (ASSURE) Center of and conditions, guidance, or other incentivizes racial balancing, contrary to
Excellence (COE) and any other activity policies and procedures related to principles of equal treatment and merit-
deemed to support the safe, secure, or Federal financial assistance that based opportunity.
efficient operation of the National promote, support, or otherwise include ■ 64. Add § 200.219 to read as follows:
Airspace System or maintenance of the use of disparate-impact liability; and
public safety, as determined by the (3) Review terms and conditions, § 200.219 Prohibition of discriminatory
Secretary or the Secretary’s designee. guidance, and other policies and event services.
(5) National Oceanic and procedures related to Federal financial (a) Public entities. Public entities that
Atmospheric Administration (NOAA) assistance to ensure alignment with this are a recipient or subrecipient of Federal
exemption. The Administrator of the paragraph (b). financial assistance must not
National Oceanic and Atmospheric (c) Recipient and subrecipient discriminate on the basis of the
Administration (NOAA), in consultation responsibilities. To the maximum extent viewpoint, content, or subject matter of
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with the Secretary of Homeland permitted by law, to avoid violating the speech—including on the basis of
Security, is exempt from the restriction Constitution and Federal civil rights political, ideological, or religious
under paragraph (b)(2) of this section if laws, recipients and subrecipients must: affiliation or perspective—in providing
the operation or procurement is (1) Not adopt, issue, or enforce services for events, meetings, or other
necessary for the purpose of meeting disparate-impact liability standards in expressive activities. This paragraph (a)
NOAA’s science or management administering programs or activities includes ensuring that, on the basis of
objectives or operational mission. supported by a Federal award; and the viewpoint, content, or subject matter
(6) Waivers. The head of a Federal (2) Review their policies and of speech, the recipient or subrecipient
agency may waive the prohibition under procedures related to Federal financial does not:
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Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules 32253
(1) Deny, reduce, or otherwise modify (1) Covered foreign country means any laws. This includes racial preferences or
services for events, meetings, or other country designated by statute, Executive other forms of racial discrimination
expressive activities in a manner that is order, or other Federal law as: used by the recipient or subrecipient
inconsistent with the level services or (i) A foreign adversary; that violate any applicable Federal anti-
access ordinarily provided for events, (ii) A country of particular concern; or discrimination laws, including activities
meetings, or expressive activities of a (iii) A country subject to sanctions or where race or intentional proxies for
similar type and size; restrictions relating to national security, race will be used as a selection criterion
(2) Impose additional, inconsistent, or defense, or intelligence activities. for employment or program
unreasonable fees, security costs, (2) Covered foreign entity means: participation. See also § 200.218;
insurance requirements, related charges, (i) An entity owned or controlled by, (2) Gender ideology as defined in
or other administrative burdens; or or acting on behalf of, a covered foreign Executive Order 14168. Gender ideology
(3) Otherwise apply event or facility- country; includes theories or ideologies that deny
use policies in a manner that has the (ii) An entity identified as an ‘‘entity the biological reality of sex or the sex
purpose or effect of suppressing lawful of particular concern’’ on a list binary in humans, or endorse or
expression of speech protected by the maintained by a Federal agency advocate for the notion that sex is a
First Amendment. pursuant to statute (including lists chosen or mutable characteristic; or
maintained under a National Defense (3) The so-called ‘‘transition’’ of a
(b) Non-public entities. To ensure that
Authorization Act or the International child under 19 years of age from one sex
Federal funds are not used in a manner
Emergency Economic Powers Act); or to another, including the chemical and
inconsistent with the First Amendment,
(iii) An entity affiliated with the surgical mutilation of children. The
the requirements of paragraph (a) of this
military, intelligence, or security term ‘‘chemical and surgical mutilation’’
section also apply to non-public entities
services of a covered foreign country. has the meaning provided in Executive
to the extent that the relevant activities
■ 66. Revise § 200.300 to read as Order 14187.
are within the scope of activities funded (c) Non-discrimination against faith-
follows:
by a Federal award. based organizations. Federal agencies
(c) Scope. (1) The prohibition in § 200.300 Statutory and national policy and pass-through entities may not
paragraph (a) of this section applies to requirements.
discriminate against or in favor of an
events sponsored, hosted, or permitted (a) In general. The Federal agency or applicant on the basis of the
by a recipient or subrecipient of Federal pass-through entity must manage and organization’s religious character,
financial assistance on property or administer the Federal award to ensure affiliation, exercise, or lack thereof, nor
facilities it owns, leases, or otherwise that Federal funding is expended and on the basis of conduct that would not
controls. associated programs are implemented in be considered ground to favor or
(2) For purposes of this section, the full accordance with the U.S. disfavor a similarly situated secular
term ‘‘services’’ includes security, Constitution and applicable Federal organization. Faith-based organizations
crowd management, access to facilities, statutes and regulations—including are eligible to apply for Federal
and other logistical or safety support provisions protecting free speech and financial assistance on the same basis as
ordinarily provided by the recipient or religious liberty, and those prohibiting any other eligible organization.
subrecipient for events of a similar type discrimination—and the requirements Applicants that meet all eligibility
and size. of this part. Consistent with Federal requirements may be considered for a
■ 65. Add § 200.220 to read as follows: law, this includes managing and Federal award under a notice of funding
administering the Federal award to opportunity.
§ 200.220 Prohibition of using Federal ensure that no person otherwise eligible ■ 67. In § 200.303, revise paragraphs (a)
funds for covered foreign collaborations.
will be unlawfully excluded from and (e) and add paragraphs (f) and (g)
(a) General prohibition. Except as participation in, unlawfully denied the to read as follows:
provided in paragraph (c) of this benefits of, or otherwise subjected to
section, Federal funds may not be unlawful discrimination in the § 200.303 Internal controls.
obligated or expended by a recipient or administration of Federal programs, * * * * *
subrecipient to support a bilateral or activities, projects, assistance, and (a) Establish, document, and maintain
multilateral collaboration, agreement, services. The Federal agency or pass- effective internal control over the
program, or activity with a covered through entity must communicate to a Federal award that provides reasonable
foreign country or covered foreign recipient or subrecipient all relevant assurance that the recipient or
entity. requirements, including those contained subrecipient is managing the Federal
(b) Scope. The prohibition in in general appropriations provisions, award in compliance with Federal
paragraph (a) of this section applies and incorporate them directly or by statutes, regulations, and the terms and
regardless of whether Federal funds are reference in the terms and conditions of conditions of the Federal award.
used for direct programmatic activities, the Federal award and all subawards. * * * * *
research, technical assistance, travel, or (b) Limitations on authorized use of (e) Take reasonable cybersecurity and
indirect costs allocable to such Federal award funds. In administering other measures to safeguard information
collaborations. Federal awards, to the maximum extent including personally identifiable
(c) Exceptions. A Federal agency may permitted by law, the Federal agency or information (PII), confidential business
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authorize an exception to this section pass-through entity must ensure that information, and other types of
when expressly authorized by Federal Federal awards and subawards are not information subject to protections
statute or the Federal agency head (or used to fund, promote, encourage, against disclosure under applicable law.
designee) determines that the activity subsidize, or facilitate: This also includes information the
does not pose a risk to national security (1) ‘‘Diversity, equity, and inclusion’’ Federal agency or pass-through entity
and is in the national interest of the (DEI) or ‘‘diversity, equity, inclusion, designates as sensitive or other
United States. and accessibility’’ (DEIA) policies, information the recipient or
(d) Definitions. For purposes of this principles, or practices that violate any subrecipient considers sensitive and is
section: applicable Federal anti-discrimination consistent with applicable Federal,
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32254 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
State, local, and tribal laws regarding Pay (DNP) System to verify eligibility (3) Are necessary and reasonable for
privacy and responsibility over and prevent improper payments. achieving the objectives of the Federal
confidentiality. * * * * * award;
(f) Participate in the Department of (c) Payment justifications for (4) Are allowable under subpart E of
Homeland Security’s E-verify program recipients and subrecipients other than this part;
to confirm the employment eligibility of States. (1) In coordination with OMB (5) Are not paid by the Federal
all employees and contractors hired in and the Department of the Treasury, Government under another Federal
or performing work in the United States each Federal agency must use an award, except where the program’s
under a Federal award. information system for payments Federal authorizing statute specifically
capable of recording a brief, written provides that Federal funds made
(1) Recipients and subrecipients must
justification for each payment request. available for the program can be applied
comply with all requirements of the E-
Federal agencies must require payment to cost sharing requirements of other
verify program and applicable Federal
justifications as described in this Federal programs;
law. (6) Are provided for in the approved
(2) If a recipient or subrecipient paragraph (c) as soon as information
budget when required by the Federal
receives a Final Nonconfirmation (FNC) systems with this capability become
agency; and
notice through E-verify, the recipient or available. (7) Conform to other applicable
subrecipient must submit this (2) Payment requests under paragraph provisions of this part.
information to the Federal agency or (d) of this section from a recipient to the (b) Inclusion of unrecovered indirect
pass-through entity. The recipient or Federal agency or a subrecipient to the costs. Unrecovered indirect costs,
subrecipient must also provide the pass-through entity must include a brief, including indirect costs on cost sharing,
Federal agency or pass-through entity written justification regardless of may be included as part of cost sharing
with the FNC case verification number whether the payment is made in with the prior approval of the Federal
and confirm that the recipient or advance or to reimburse the recipient or agency or pass-through entity.
subrecipient has taken appropriate subrecipient. The brief, written Unrecovered indirect costs means the
actions consistent with E-Verify justification must include information difference between the amount charged
program requirements. Failure to on the activities or aspects of the to the Federal award and the amount
provide notice or take appropriate Federal award that correspond to the which could have been charged to the
action may result in the termination of payment request. For example, this may Federal award under the recipient’s or
the Federal award. include project milestones, project subrecipient’s approved indirect cost
(g) In carrying out the internal control activities, administrative activities, or rate.
requirements of this section, a non- other requirements that must be (c) Valuation for contribution of
Federal entity that is a State must, prior completed under the Federal award. services. Values for recipient or
to the disbursement of payments made (d) Payments for recipients and subrecipient contributions of services
using Federal award funds subject to subrecipients other than States. For and property must be established in
this part, review available data sources recipients and subrecipients other than accordance with the cost principles in
with relevant information to verify the States, payment methods must subpart E of this part. When a Federal
eligibility of payees and prevent minimize the time elapsing between the agency or pass-through entity authorizes
improper payments. Such reviews may transfer of funds from the Federal the recipient or subrecipient to donate
be conducted through the Department of agency or the pass-through entity and buildings or land for construction/
the Treasury’s Do Not Pay (DNP) the disbursement of funds by the facilities acquisition projects or long-
system, or through an alternative recipient or subrecipient regardless of term use, the value of the donated
payment screening process that whether the payment is made by property for cost sharing must be the
provides protection against improper electronic funds transfer or by other lesser of paragraph (c)(1) or (2) of this
payments. This requirement is in means. See § 200.302(b)(6). Except as section.
addition to, and does not replace, any noted in this part, the Federal agency (1) The value of the remaining life of
program-specific eligibility verification must require recipients to use only the property recorded in the recipient’s
or payment screening requirements OMB-approved, Government-wide or subrecipient’s accounting records at
applicable to a Federal award. information collections to request the time of donation.
payment. (2) The current fair market value.
■ 68. In § 200.305:
* * * * * However, when there is sufficient
■ a. Redesignate paragraphs (a) and (b)
■ 69. Revise § 200.306 to read as justification, the Federal agency or pass-
as paragraphs (b) and (d), respectively; through may approve using the current
follows:
■ b. Add new paragraph (a) and fair market value of the donated
paragraph (c); and § 200.306 Cost sharing. property, even if it exceeds the value
■ c. Revise newly redesignated (d) (a) Criteria for cost sharing funds. For described in paragraph (c)(1) of this
introductory text. all Federal awards, the Federal agency section at the time of donation.
The additions and revision read as or pass-through entity must accept any (d) Volunteer services by third-parties.
follows: cost sharing funds (including cash and Volunteer services furnished by third-
third-party in-kind contributions, and party professional and technical
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§ 200.305 Federal payment. also including funds committed by the personnel, consultants, and other labor
(a) Treasury Do Not Pay (DNP) System recipient, subrecipient, or third parties) may be counted as cost sharing if the
Review and Verification. Prior to the as part of the recipient’s or service is necessary for the program.
disbursement of any Federal payment subrecipient’s contributions to a Rates for third-party volunteer services
under this part, the Federal agency must program when the funds: must be consistent with those paid for
review available data sources with (1) Are verifiable in the recipient’s or similar work by the recipient or
relevant information on the eligibility of subrecipient’s records; subrecipient. When the required skills
the recipient included in the (2) Are not included as contributions are not found in the recipient’s or
Department of the Treasury’s Do Not for any other Federal award; subrecipient’s workforce, rates must be
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Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules 32255
consistent with those paid for similar (for example, certified real property § 200.307 Program income.
work in the labor market where the appraiser or General Services (a) In general. The recipient or
recipient or subrecipient competes for Administration representative) and subrecipient is encouraged to earn
the services involved. In either case, certified by a responsible official of the income to defray program costs when
fringe benefits that are allowable, recipient or subrecipient as required by appropriate. Program income must be
allocable, and reasonable may be the Uniform Relocation Assistance and used for the original purpose of the
included in the valuation. Real Property Acquisition Policies Act Federal award. Program income earned
(e) Valuation for services of third- of 1970, as amended (42 U.S.C. 4601– during the period of performance may
party employees. When a third-party 4655), except as provided in the only be used for costs incurred during
organization furnishes the services of an implementing regulations at 49 CFR part the period of performance or allowable
employee, these services must be valued 24. closeout costs. See § 200.472(b).
at the employee’s regular rate of pay (2) The value of donated equipment Program income must be expended
plus an amount of fringe benefits that is must not exceed the fair market value at prior to requesting additional Federal
reasonable, necessary, allocable, and the time of donation. funds. Program income exceeding
otherwise allowable, and indirect costs (3) The value of donated space must amounts specified in the Federal award
at either the third-party organization’s not exceed the fair rental value of may be added to or deducted from the
approved federally-negotiated indirect comparable space as established by an total allowable costs in accordance with
cost rate or, a rate in accordance with independent appraisal of comparable the terms and conditions of the Federal
§ 200.414 provided these services space and facilities in a privately-owned
award.
employ the same skill(s) for which the building in the same locality.
employee is normally paid. Where (4) The value of loaned equipment * * * * *
must not exceed its fair rental value. ■ 71. In § 200.308, revise paragraph (e)
donated services are treated as indirect
costs, indirect cost rates will separate (i) Documentation and support for fair to read as follows:
the value of the donated services so that market value. The fair market value of
§ 200.308 Revision of budget and program
reimbursement for the donated services third-party in-kind contributions must plans.
will not be made. be documented and, to the extent
feasible, supported by the same methods * * * * *
(f) Donated property from third
used internally by the recipient or (e) Limitation on other prior approval
parties. Donated property from third
subrecipient. requirements. Unless specified in this
parties may include items such as
(j) Voluntary committed cost sharing part, the Federal agency must not
equipment, office supplies, laboratory
for research grants. Voluntary impose additional prior approval
supplies, or workshop and classroom
committed cost sharing is not expected requirements without OMB approval.
supplies. The assessed value of donated
under Federal research grants. The See also §§ 200.102 and 200.407.
property included as cost sharing must
not exceed the property’s fair market Federal agency may not use voluntary * * * * *
value at the time of the donation. committed cost sharing as a factor ■ 72. In § 200.313, revise paragraph (b)
(g) Valuation of donated equipment, during the merit review of applications to read as follows:
buildings, and land. The method used or proposals for Federal research grants
§ 200.313 Equipment.
for determining the value of donated unless authorized by Federal statutes or
equipment, buildings, and land for agency regulations and specified in the * * * * *
which title passes to the recipient or notice of funding opportunity. Federal (b) In general. A State must use,
subrecipient may differ according to the agencies are also discouraged from manage and dispose of equipment
following: using voluntary committed cost sharing acquired under a Federal award in
(1) If the purpose of the Federal award as a factor during the merit review of accordance with State laws and
is to assist the recipient or subrecipient applications for other Federal financial procedures. Indian Tribes must use,
in acquiring equipment, buildings, or assistance programs. If voluntary manage, and dispose of equipment
land, the aggregate value of the donated committed cost sharing is used for this acquired under a Federal award in
property may be claimed as cost purpose for other programs, the notice accordance with tribal laws and
sharing. of funding opportunity must specify procedures. If such laws and procedures
(2) If the purpose of the Federal award how an applicant’s proposed cost do not exist, Indian Tribes must follow
is to support activities that require the sharing will be considered. See the regulation in this section. Other
use of equipment, buildings, or land, §§ 200.414 and 200.204 and appendix I recipients and subrecipients, including
only depreciation charges for equipment to this part. subrecipients of a State or Indian Tribe,
and buildings may be made. However, (k) Voluntary uncommitted cost must follow paragraphs (c) through (e)
the fair market value of equipment or sharing for institutions of higher of this section.
other capital assets and fair rental education. For institutions of higher * * * * *
charges for land may be allowed if education (IHE), voluntary uncommitted ■ 73. In § 200.318, revise paragraph (l)
provided in the terms and conditions of cost sharing should be treated to read as follows:
the Federal award. See § 200.420. differently from mandatory or voluntary
(h) Accounting policies for donated committed cost sharing. Voluntary § 200.318 General procurement standards.
property. The value of donated property uncommitted cost sharing should not be * * * * *
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must be determined in accordance with included in the organized research base (l) Additional employment practices.
the accounting policies of the recipient for computing the indirect cost rate or (1) The procurement standards in this
or subrecipient with the following reflected in any allocation of indirect subpart do not prohibit recipients or
qualifications: costs. Voluntary uncommitted cost subrecipients from:
(1) The value of donated land and sharing includes faculty-donated (i) Communicating a requirement that
buildings must not exceed its fair additional time above that agreed to as individuals hired or employed under
market value at the time of donation to part of the award. the Federal award must be authorized to
the recipient or subrecipient as ■ 70. In § 200.307, revise paragraph (a) work in the United States under
established by an independent appraiser to read as follows: applicable Federal law; or
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(ii) Using Project Labor Agreements § 200.322 Domestic preferences for ■ b. Add paragraphs (h) and (i).
(PLAs) or other types of pre-hire procurements. The revisions and additions read as
collective bargaining agreements if the (a) To the greatest extent practicable follows:
use of such agreements will advance the and consistent with law, Federal
interest of the Federal Government agencies must include terms and § 200.329 Monitoring and reporting
associated with the applicable Federal conditions in Federal awards to program performance.
financial assistance program, including maximize the use of goods, products, * * * * *
consideration of practicability and cost and materials produced in the United (b) Reporting program performance.
effectiveness. States. If included in a Federal award, The Federal agency must use OMB-
(2) Federal agencies may allow these requirements must also be approved common information
recipients to use such practices if included in all subawards, contracts, collections (for example, Research
consistent with the U.S. Constitution, and purchase orders under Federal Performance Progress Reports) when
applicable Federal statutes and awards. requesting performance reporting
regulations, the objectives and purposes (b) Federal agencies providing Federal information. The Federal agency or
of the applicable Federal financial financial assistance for infrastructure pass-through entity may not collect
assistance program, and other projects must implement the Buy performance reports more frequently
requirements of this part. Recipients America preferences set forth in 2 CFR than quarterly unless a specific
and subrecipients are also responsible part 184. condition has been implemented in
for ensuring consistency with applicable ■ 77. Revise § 200.323 to read as accordance with § 200.208. To the
law. Employment practices should be follows: extent practicable, the Federal agency or
consistent with the foundational pass-through entity should align the due
§ 200.323 Procurement of recovered
principles of recognizing merit and the materials.
dates of performance reports and
ability of employees to fulfill the financial reports. When reporting
A recipient or subrecipient that is a
requirements of the contract. program performance, the recipient or
■ 74. In § 200.320, revise the
State agency, an agency of a political
subrecipient must relate financial data
introductory text to read as follows: subdivision of a State, or a contractor to
and project or program
such entity, must comply with section
accomplishments to the performance
§ 200.320 Procurement methods. 6002 of the Solid Waste Disposal Act, as
goals and objectives of the Federal
There are three types of procurement amended by the Resource Conservation
award. Consistent with appendix A to 2
methods described in this section: and Recovery Act of 1976 as amended,
CFR part 170, the recipient must
informal procurement methods (for 42 U.S.C. 6962. The requirements of
confirm that it has reported any
micro-purchases and simplified section 6002 include procuring only
subawards issued during the reporting
acquisitions); formal procurement items designated in the guidelines of the
period on SAM.gov. Also, the recipient
methods (through sealed bids or Environmental Protection Agency (EPA)
or subrecipient must provide cost
proposals); and noncompetitive at 40 CFR part 247 that contain the
information to demonstrate cost-
procurement methods. For any of these highest percentage of recovered
effective practices (for example, through
methods, the recipient or subrecipient materials practicable, consistent with
unit cost data) when required by the
must maintain and use documented maintaining a satisfactory level of
terms and conditions of the Federal
procurement procedures, consistent competition, where the purchase price
award. In some instances (for example,
with the standards of this section and of the item exceeds $10,000 or the value
discretionary research awards), this may
§§ 200.317, 200.318, and 200.319. of the quantity acquired during the
be limited to the requirement to submit
Recipients are strongly discouraged preceding fiscal year exceeded $10,000;
technical performance reports.
from issuing cost-reimbursement procuring solid waste management
Reporting requirements must clearly
contracts. When using cost- services in a manner that maximizes
indicate a standard against which the
reimbursement contracts, the recipient energy and resource recovery; and
recipient’s or subrecipient’s
must notify the awarding Federal establishing an affirmative procurement
performance can be measured.
agency of its use of this mechanism and program for procurement of recovered
Reporting requirements should not
maintain a written justification in its materials identified in the EPA
solicit information from the recipient or
records. A Federal agency may, at its guidelines.
subrecipient that is not necessary for the
discretion, require prior approval of ■ 78. In § 200.324, revise paragraph (a)
effective monitoring or evaluation of the
cost-reimbursement contracts in the to read as follows:
Federal award. Federal agencies should
terms and conditions of the Federal § 200.324 Contract cost and price. consult monitoring framework
award, which may include review of the documents such as the agency’s
recipient’s written justification. (a) The recipient or subrecipient must
perform a cost or price analysis for Evaluation Plan to make that
* * * * * every procurement transaction, determination. As noted in OMB
■ 75. Revise § 200.321 to read as Circular A–11, Part 6, Section 280,
including contract modifications, in
follows: measures of customer experience are of
excess of the simplified acquisition
§ 200.321 Contracting with small threshold. The method and degree of co-equal importance as traditional
businesses. analysis conducted depend on the facts measures of financial and operational
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When possible, the recipient or surrounding the particular procurement performance.
subrecipient should ensure that small transaction. However, as a starting * * * * *
businesses, including subcategories of point, the recipient or subrecipient must (e) Scientific research performance
small businesses enumerated in Federal make independent estimates before reports. When submitting a performance
statute, are considered when issuing receiving bids or proposals. report for scientific research, the
contracts under Federal financial * * * * * recipient must identify and include the
assistance awards. ■ 79. In § 200.329: categorization provided in the terms and
■ 76. Revise § 200.322 to read as ■ a. Revise paragraphs (b) and (e) conditions of the award. See
follows: through (g); and § 200.202(g).
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(f) Significant developments. When a a determination is required. See also three years from the date of submission
significant development that could § 200.332(h). of their final financial report. For
impact the Federal award occurs ■ 81. In § 200.332: awards that are renewed quarterly or
between performance reporting due ■ a. Revise paragraphs (g) through (i); annually, the recipient and subrecipient
dates, the recipient or subrecipient must and must retain records for three years from
notify the Federal agency or pass- ■ b. Add paragraphs (j) through (l). the date of submission of their quarterly
through entity. Significant The revisions and additions read as or annual financial report, respectively.
developments include events that follows: Records to be retained include, but are
enable meeting milestones and not limited to, financial records,
objectives sooner or at less cost than § 200.332 Requirements for pass-through
supporting documentation, and
entities.
anticipated or that produce different statistical records. Federal agencies or
beneficial results than originally * * * * * pass-through entities may not impose
planned. Significant developments also (g) Comply with applicable any other record retention requirements
include problems, delays, or adverse requirements in 2 CFR part 170 to report except for the following:
conditions which will impact the subawards on SAM.gov no later than the
* * * * *
recipient’s or subrecipient’s ability to end of the month following the month ■ 84. Revise § 200.336 to read as
meet milestones or the objectives of the in which the subaward was issued. follows:
Federal award. When significant (h) Make subrecipient or contractor
developments occur that negatively determinations under § 200.331 for all § 200.336 Methods for collection,
impact the Federal award, the recipient downstream entities receiving payments transmission, and storage of information.
or subrecipient must include from the pass-through entity, including When practicable, the Federal agency
information on their plan for corrective affiliates, subsidiaries, or other related or pass-through entity and the recipient
action and any assistance needed to organizations. Internal organizational or subrecipient must collect, transmit,
resolve the situation. affiliations do not exempt pass-through and store Federal award information in
(g) Site visits. The Federal agency or entities from subaward or contract open and machine-readable formats. A
pass-through entity may conduct in- classification and related compliance machine-readable format is a format in
person or virtual site visits as and reporting requirements. a standard computer language (not
warranted. (i) Ensure that each subrecipient is in English text) that can be read
(h) Reviewing subrecipient reporting compliance with the terms and automatically by a computer system.
in SAM.gov. The Federal agency is conditions of the subaward and does not Upon request, the Federal agency or
responsible for providing oversight to take actions that could significantly pass-through entity must always
ensure that recipients comply with their damage the reputation of the pass- provide paper versions of Federal award
requirement to report subawards on through entity, the Federal agency information to and from the recipient or
SAM.gov and taking corrective action if making the award, or the Federal subrecipient. The Federal agency or
recipients are not in compliance. See Government. If a pass-through entity pass-through entity must not require
also § 200.332. determines that a subrecipient has taken additional copies of Federal award
(i) Performance report requirement such actions, it must consult with the information submitted in paper
waiver. The Federal agency may waive Federal agency to determine whether versions. The recipient or subrecipient
any performance report that is not the subaward should be terminated is not required to create and retain
necessary to ensure the goals and under § 200.340. If the Federal agency paper copies when original records are
objectives of the Federal award are determines that such significant electronic and cannot be altered. In
being achieved. The Federal agency reputational harm has occurred, it may addition, the recipient or subrecipient
must justify this waiver, maintain the either direct the pass-through entity to may substitute electronic versions of
justification in the Federal agency’s terminate the subaward or terminate the original paper records through
records, and incorporate in the agency’s Federal award to the pass-through duplication or other forms of electronic
risk assessment the decision to waive entity. conversion, provided that the
the requirement. (j) Verify that a subrecipient is procedures are subject to periodic
■ 80. In § 200.331, add paragraph (c) to audited as required by subpart F of this quality control reviews. Quality control
read as follows: part. reviews must ensure that electronic
(k) Consider whether the results of a conversion procedures provide
§ 200.331 Subrecipient and contractor
subrecipient’s audit, site visits, or other safeguards against the alteration of
determinations.
monitoring necessitate adjustments to records and assurance that records
* * * * * the pass-through entity’s records. remain in a format that is readable by
(c) Transfers to related entities. Pass- (l) Consider taking enforcement action a computer system. Recipients and
through entities may not circumvent the against noncompliant subrecipients as subrecipients are strongly encouraged to
requirements of this section by treating described in § 200.339 and in program utilize domestic storage capabilities for
payments of Federal funds to affiliates, regulations. electronic records.
subsidiaries, or other related entities ■ 82. Revise § 200.333 to read as ■ 85. Revise § 200.338 to read as
that are separate legal persons as follows: follows:
internal transfers not requiring a
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determination under this section. Such § 200.333 Fixed amount subawards. § 200.338 Restrictions on public access to
transfers of Federal funds must be Fixed amount subawards are not records.
evaluated under this section and treated permitted. Federal agencies may not place
as either subawards or contracts, as ■ 83. In § 200.334, revise the restrictions on the recipient or
appropriate. For example, if a related introductory text to read as follows: subrecipient that limit public access to
entity receives payment to perform the records of the recipient or
activities under the Federal award, such § 200.334 Record retention requirements. subrecipient pertaining to a Federal
as carrying out a portion of the Federal The recipient and subrecipient must award, except for personally identifiable
award or providing goods and services, retain all Federal award records for information (PII), confidential business
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32258 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
information, or other sensitive private causes of action and civil effective date, and, in the case of partial
information subject to protections remedies based on the failure of a termination, the portion to be
against disclosure under applicable law. recipient or subrecipient to comply with terminated. However, if the Federal
Federal agencies may only place such the U.S. Constitution, Federal statutes, agency or pass-through entity
restrictions when the Federal agency regulations, or the terms and conditions determines that the remaining portion of
can demonstrate that such records will of a Federal award. Consistent with the Federal award will not accomplish
be kept confidential and would have § 200.318(k), this generally would not the purposes for which the Federal
been exempted from disclosure include cases related to the settlement award was made, the Federal agency or
pursuant to the Freedom of Information of contractual or administrative issues pass-through entity may terminate the
Act (FOIA) (5 U.S.C. 552) or controlled arising out of a recipient’s or Federal award in its entirety; or
unclassified information pursuant to subrecipient’s procurement (5) Pursuant to additional terms and
Executive Order 13556 if the records transactions, except as necessary to conditions. The Federal agency or pass-
had belonged to the Federal agency. The comply with law or if the matter is through entity, to the extent permitted
Freedom of Information Act does not primarily a Federal concern. A Federal by law, may terminate a Federal award
apply to records that remain under the agency should only cooperate with a in part or its entirety pursuant to any
recipient’s or subrecipient’s control private cause of action if it determines additional termination provisions
except as required by § 200.315. Unless that such cooperation is in the interest included in the terms and conditions of
required by Federal, State, local, or of the United States. the Federal award.
tribal law, recipients and subrecipients ■ 87. Revise § 200.340 to read as (b) Requirements for termination
are not required to permit public access follows: provisions—(1) General requirements.
to their records. The recipient’s or The Federal agency or pass-through
§ 200.340 Termination and suspension. entity must clearly and unambiguously
subrecipient’s records provided to a
(a) Termination provisions. The specify all termination provisions in the
Federal agency generally will be subject
Federal award may be terminated in terms and conditions of the Federal
to FOIA and applicable exemptions.
■ 86. Revise § 200.339 to read as
part or its entirety as follows: award. To the extent permitted by law,
(1) For noncompliance by the and except as provided in paragraph
follows:
recipient or subrecipient. The Federal (b)(2) of this section, the Federal agency
§ 200.339 Remedies for noncompliance. agency or pass-through entity may and pass-through entity must ensure
(a) Remedies for noncompliance. The terminate a Federal award in part or its that all Federal awards allow
Federal agency or pass-through entity entirety if the recipient or subrecipient termination for the reasons described in
may implement specific conditions if fails to comply with the terms and paragraphs (a)(1) through (4) of this
the recipient or subrecipient fails to conditions of the Federal award, section. For example, the Federal
comply with the U.S. Constitution, including a failure of the recipient to agency or pass-through entity may
Federal statutes, regulations, or terms report subawards on SAM.gov pursuant include a termination provision
and conditions of the Federal award. to the award term required by 2 CFR incorporating this section of the
See § 200.208 for additional information part 170. See also §§ 200.341 and regulation by reference or including all
on specific conditions. When the 200.342; of the reasons for termination in
Federal agency or pass-through entity (2) At the discretion of the Federal paragraphs (a)(1) through (4). In
determines that noncompliance cannot agency or pass-through entity. The accordance with paragraph (a)(5) of this
be remedied by imposing specific Federal agency or pass-through entity, section, to the extent authorized by law,
conditions, the Federal agency or pass- to the extent permitted by law, may the Federal agency or pass-through
through entity may take one or more of terminate a Federal award in part or its entity may also include additional
the following actions: entirety if the Federal agency or pass- termination provisions not specified in
(1) Temporarily withhold payments through entity determines that a this section. See also § 200.211(c)(1)(v).
until the recipient or subrecipient takes termination is in the interest of the (2) Exceptions. Paragraph (a)(2) of this
corrective action. Federal agency or pass-through entity, section does not apply to any Federal
(2) Disallow costs for all or part of the including if a Federal award does not award in which inclusion of such a
activity associated with the effectuate program goals, Federal agency discretionary termination provision
noncompliance of the recipient or priorities, or the national interest as would conflict with a Federal statute.
subrecipient. they exist at the time of the termination. See §§ 200.101(d) and 200.102(b)
(3) Suspend or terminate the Federal See also § 200.341; regarding statutory conflicts and
award in part or in its entirety. (3) By mutual agreement of the exceptions. The discretionary
(4) Initiate suspension or debarment parties. The Federal agency or pass- termination provision is generally
proceedings as authorized in 2 CFR part through entity may terminate a Federal applicable to discretionary awards, but
180 and the Federal agency’s award in part or its entirety with the not to Federal awards made under
regulations, or for pass-through entities, consent of the recipient or subrecipient, programs where legislation establishes
recommend suspension or debarment in which case the two parties must agree an entitlement to the funds on the part
proceedings be initiated by the Federal upon the termination conditions. These of the recipient, such as block grants,
agency. conditions include the effective date of those awarded based on a statutory
(5) Withhold further Federal funds the termination and, in the case of formula, or disaster recovery grants.
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(new awards or continuation funding) partial termination, the portion to be Consistent with Executive Order 14332,
for the project or program. terminated; or paragraph (a)(2) also does not apply to
(6) Pursue other legally available (4) Upon notification by the recipient agreements entered into in furtherance
remedies. or subrecipient. The recipient or of international trade agreements or
(b) Private causes of action. If subrecipient may terminate a Federal those awarded by the Department of
applicable and consistent with law and award in part or its entirety upon Commerce under title XCIX of the
regulation, a Federal agency, may, at its sending the Federal agency or pass- William M. (Mac) Thornberry National
discretion, cooperate with individuals through entity a written notification of Defense Authorization Act for Fiscal
or organizations in their pursuit of the reasons for such termination, the Year 2021 (Pub. L. 116–283), the CHIPS
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Act of 2022 (Pub. L. 117–167), or resolve the issue in accordance with the promptly resume activities under the
division F of the Infrastructure agency’s FOIA procedures. Federal award at the conclusion of the
Investment and Jobs Act (Pub. L. 117– (d) Closeout requirements following suspension period.
58). If questions arise regarding termination. When the Federal award is (4) Inclusion of suspension provision
applicability of paragraph (a)(2) to terminated in part or its entirety, the in Federal award. The Federal agency or
specific Federal programs or types of Federal agency or pass-through entity pass-through entity must clearly and
Federal awards, Federal agencies are and recipient or subrecipient remain unambiguously include the suspension
strongly encouraged to consult with responsible for compliance with the provision described in this section in
OMB. Federal agencies must seek closeout requirements in §§ 200.344 and the terms and conditions of the Federal
approval from OMB prior to allowing 200.345. award. The suspension provision
any class exceptions for paragraph (a)(2) (e) Temporary suspension—(1) In described in this section does not apply
related to a Federal program or type of general. The Federal agency or pass- to any Federal award in which inclusion
Federal award not set forth in this through entity, to the extent permitted of such a suspension provision would
paragraph (b)(2). by law, may at any time issue a written conflict with a Federal statute. See
(c) Reporting requirements related to order temporarily suspending a Federal §§ 200.101(d) and 200.102(b) regarding
terminations for noncompliance. When award in part or its entirety if the statutory conflicts and exceptions. The
the Federal agency terminates the Federal agency or pass-through entity suspension provision is generally
Federal award prior to the end of the determines that a suspension is in the applicable to discretionary awards, but
period of performance due to the interest of the Federal agency or pass- not to Federal awards made under
recipient’s material failure to comply through entity. A suspension order programs where legislation establishes
with the terms and conditions of the under this provision must not exceed a an entitlement to the funds on the part
Federal award, the Federal agency must period of 90 days unless the parties of the recipient, such as block grants,
report the termination in SAM.gov. A mutually agree to an extended period. those awarded based on a statutory
Federal agency must use the Contractor The period of suspension will begin to formula, or disaster recovery grants. If
Performance Assessment Reporting run after a written order of suspension questions arise regarding applicability
System (CPARS) to enter information in is delivered to the recipient or of the suspension provision to specific
SAM.gov. subrecipient. The suspension order Federal programs or types of Federal
(1) The information required under must: awards, Federal agencies are strongly
this paragraph (c) is not to be reported (i) Direct the recipient or subrecipient encouraged to consult with OMB.
in SAM.gov until the recipient has to temporarily stop all or part of the (5) Suspension for non-compliance.
either: activities under the Federal award; The suspension provision in this section
(i) Exhausted its opportunities to (ii) Specify the effective date, scope, does not limit the authority in § 200.339
object or challenge the decision (see and expected duration of the related to a suspension for
§ 200.342); or suspension, which may not exceed a noncompliance. Consistent with law,
(ii) Has not, within 30 calendar days period of 90 days unless extended by the suspension authority in § 200.339
after being notified of the termination, mutual agreement; and may apply more broadly, including
informed the Federal agency that it (iii) Consistent with paragraph (e)(2) under Federal programs in which the
intends to appeal the decision to of this section, direct the recipient or Federal agency or pass-through entity
terminate. subrecipient to take all reasonable steps finds that the suspension provision in
(2) If a Federal agency, after entering to minimize the incurrence of costs this section does not apply. Federal
information about a termination in allocable to activities covered by the agencies must follow procedures
SAM.gov, subsequently: order during the suspension period. described in § 200.342 upon initiating a
(i) Learns that any of that information (2) Activities during suspension
remedy for noncompliance.
is erroneous, the Federal agency must period. During the suspension period, ■ 88. Revise § 200.341 to read as
correct the information in the system the recipient or subrecipient must take follows:
within three business days; and reasonable steps to minimize the
(ii) Obtains an update to that incurrence of costs allocable to activities § 200.341 Notification of termination
information that could be helpful to covered by the order. See § 200.343. The requirement.
other Federal agencies, the Federal Federal agency or pass-through entity (a) In general. The Federal agency or
agency is strongly encouraged to amend may determine to cancel the suspension pass-through entity must provide
the information in the system to order before its expiration if warranted written notice of termination to the
incorporate the update in a timely way. under the circumstances. The Federal recipient or subrecipient. The written
(3) The Federal agency must not post agency may also proceed to terminate notice of termination should include the
any information that will be made the Federal award in whole or in part reasons for termination, the effective
publicly available in the non-public under paragraph (a) of this section. date, and the portion of the Federal
segment of SAM.gov that is covered by (3) Resumption of activities following award to be terminated, if applicable.
a disclosure exemption under the suspension period. If the suspension (b) Notifications of termination for
Freedom of Information Act (FOIA). order is cancelled, or after the period noncompliance. If the Federal award is
When the recipient asserts within seven covered by the order or any extension of terminated for the recipient’s material
calendar days to the Federal agency the order expires, the Federal agency or failure to comply with a Federal award,
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which posted the information that a pass-through entity should consider and for the portion of the Federal award to
disclosure exemption under FOIA seek to resolve any budgetary or be terminated, which may encompass
covers some of the information made schedule impacts resulting from the up to the entirety of the Federal award,
publicly available, the Federal agency order. Consistent with law, and as the notification must instruct the
that posted the information must appropriate and warranted under the recipient or subrecipient to stop work,
remove the posting within seven circumstances, the Federal agency make no additional financial
calendar days of receiving the assertion. should consider making adjustments to obligations, and, to the extent
Before reposting the releasable the project schedule, project budget, or authorized by law, terminate all
information, the Federal agency must both. The recipient or subrecipient must subawards and contracts related to the
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terminated portion of the Federal award. cost principles applicable to termination the Federal agency must provide the
Consistent with § 200.342, the and standard closeout costs. The notice information required by the Federal
notification for a termination for from the Federal agency or pass-through Funding Accountability and
noncompliance must also provide the entity must provide a reasonable time Transparency Act (FFATA) to
recipient with an opportunity to object for submission of the written statement USAspending.gov. In addition, the
and provide information challenging the (such as 30 or 60 days, as appropriate) Federal agency must update or notify
action. The notification must also state and explain that the Federal agency or any other relevant Government-wide
the following: pass-through entity will consider the systems or entities of any indications of
(1) The termination decision will be written statement in reaching a final poor performance as required by 41
reported in SAM.gov; decision regarding allowable costs U.S.C. 2313 and 31 U.S.C. 3354.
(2) The information will be available under §§ 200.343 and 200.344. ■ 89. Revise § 200.342 to read as
in SAM.gov for five years from the date (4) The written statement of follows:
of the termination and then archived; termination costs must be sufficiently
(3) Federal agencies that consider detailed to permit the Federal agency or § 200.342 Opportunities to object,
making a Federal award to the recipient pass-through entity to evaluate the hearings, and appeals.
during the five year period must allowability, allocability, and The Federal agency must maintain
consider this information in judging reasonableness of the claimed costs. The written procedures for processing
whether the recipient is qualified to written statement must represent the objections, hearings, and appeals related
receive the Federal award when the recipient’s or subrecipient’s complete to remedies for noncompliance. Upon
Federal share of the Federal award is presentation of termination-related costs initiating a remedy for noncompliance
expected to exceed the simplified and claims, subject to review and (for example, disallowed costs, a
acquisition threshold over the period of resolution under §§ 200.343 and corrective action plan, or termination
performance; and 200.344. The statement of termination for noncompliance), the Federal agency
(4) The recipient may comment on costs from the recipient or subrecipient must provide the recipient with an
any information in SAM.gov about the must include: opportunity to object and provide
recipient for future consideration by (i) A written statement regarding any information challenging the action. The
Federal agencies. The recipient may termination costs it believes are Federal agency or pass-through entity
submit comments in SAM.gov. relevant, including costs, financial must comply with any requirements for
(5) Federal agencies should consider obligations, expenditures, claims, and hearings, appeals, or other
the recipient’s comments when other commitments the recipient or administrative proceedings to which the
determining whether the recipient is subrecipient made in reasonable recipient or subrecipient is entitled
qualified for a Federal award. expectation of continued funding under under any statute or regulation
(c) Notifications of discretionary the Federal award; the financial or applicable to the action involved. The
termination. In the case of a programmatic impact of terminating Federal agency is not required to allow
discretionary termination under those commitments; and any steps the for objections, hearings, and appeals
§ 200.340(a)(2), the notice must provide: recipient or subrecipient has taken, or related to any reasons for termination
(1) A brief summary of the reason or proposes to take, to avoid, minimize, except termination for noncompliance.
reasons for finding that termination is in mitigate, or otherwise reduce those ■ 90. Revise § 200.343 to read as
the interest of the Federal agency or impacts; follows:
pass-through entity. The reason or (ii) Documentation in support of any
reasons may apply to an individual § 200.343 Effects of suspension and
termination costs the recipient or termination.
award or class of awards. The Federal subrecipient believes are relevant; and
agency or pass-through entity is not (iii) Information regarding whether (a) In general. Costs to the recipient or
required to provide a detailed or commitments are cancelable, the terms subrecipient resulting from financial
exhaustive analysis; for cancelling those commitments, and obligations incurred by the recipient or
(2) For the portion of the Federal any penalties or costs of cancellation. If subrecipient during a suspension or
award to be terminated, which may commitments are not cancellable, the after the termination of a Federal award
encompass up to the entirety of the written statement should explain why are not allowable unless the Federal
Federal award, instructions to the the commitments were not structured to agency or pass-through entity expressly
recipient or subrecipient to stop work, allow cancellation, and whether they authorizes them in the notice of
make no additional financial could have been. suspension or termination or
obligations, and, to the extent (iv) A certification, signed by an subsequently. However, costs during
authorized by law, terminate all authorized official of the recipient or suspension or after termination are
subawards and contracts related to the subrecipient, stating that the written allowable if:
terminated portion of the Federal award; statement of termination costs is true, (1) The costs result from financial
and complete, and accurate to the best of the obligations which were properly
(3) An opportunity for the recipient or official’s knowledge and belief, and that incurred by the recipient or subrecipient
subrecipient to submit a written the costs claimed: before the effective date of suspension
statement of termination costs, which (A) Are based on records maintained or termination, and not in anticipation
shall constitute a complete and accurate in the ordinary course of business; of it; and
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statement of all costs, financial (B) Reflect the recipient’s or (2) The costs would be allowable if
obligations, expenditures, claims, and subrecipient’s good-faith assessment of the Federal award was not suspended or
other commitments the recipient or costs reasonably incurred or committed expired normally at the end of the
subrecipient believes are relevant to the as a result of the Federal award; and period of performance in which the
termination. Under this paragraph (c)(3), (C) Do not include costs that are termination takes effect, provided that
termination costs means those costs that unallowable, speculative, or unrelated the recipient or subrecipient takes all
are reasonably related to winding down to the termination. reasonable steps to cancel, mitigate, or
activities undertaken as a result of the (d) Reporting for all terminations. otherwise reduce such financial
Federal award. See also § 200.472(a) for Upon termination of the Federal award, obligations and provides documentation
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Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules 32261
of those efforts to the Federal agency required by Federal statute or approved § 200.421 Advertising and public relations.
upon request. by the cognizant agency for indirect (a) In general. Except as provided in
(b) Costs resulting from discretionary costs in coordination with OMB in paragraph (b) of this section, advertising
terminations. (1) This section does not extraordinary circumstances. and public relations costs (including
expressly require the Federal agency to ■ 93. Revise § 200.402 to read as those related to magazines, newspapers,
authorize any additional costs to the follows: radio and television, direct mail,
recipient or subrecipient resulting from exhibits, and electronic or computer
financial obligations incurred after the § 200.402 Composition of costs.
transmittals) are unallowable under
termination of a Federal award. The total cost of a Federal award is Federal awards and may not be charged
However, as appropriate and consistent the sum of the allowable direct and directly, indirectly, or through another
with law, upon making a discretionary indirect costs minus any applicable cost allocation methodology.
termination under § 200.340(a)(2), the credits. (b) Exceptions. The only exceptions to
Federal agency may consider allowing ■ 94. In § 200.403, revise paragraph (g) paragraph (a) of this section are for
the Federal share of necessary and to read as follows: advertising and public relation costs
reasonable costs resulting from financial specifically required by Federal statute
§ 200.403 Factors affecting allowability of
obligations incurred by the recipient or or advertising costs which are solely for:
costs.
subrecipient after the termination of a (1) The procurement of goods and
Federal award based on information * * * * * services for the performance of a Federal
provided by the recipient in response to (g) Be adequately documented. See award;
the notice under § 200.341(c). §§ 200.300 through 200.309 and 200.334 (2) The disposal of scrap or surplus
(2) The decision regarding whether to through 200.338. materials acquired in the performance of
allow additional costs under paragraph * * * * * a Federal award except when the
(b)(1) of this section is left to the ■ 95. In § 200.405, revise paragraph (d) recipient or subrecipient is reimbursed
reasonable discretion of the Federal to read as follows: for disposal costs at a predetermined
agency. The Federal agency may weigh amount; or
payment of additional termination costs § 200.405 Allocable costs. (3) Program advertising and outreach
against competing policy concerns such * * * * * (for example, recruiting project
as responsible stewardship of Federal (d) Direct cost allocation principles. If participants) and other specific
funds, program goals, Federal agency a cost benefits two or more projects or purposes necessary to meet the Federal
priorities, or the national interest. activities in proportions that can be award requirements.
■ 91. In § 200.400, revise paragraph (g) determined without undue effort or ■ 98. Revise § 200.429 to read as
to read as follows: cost, the cost must be allocated to the follows:
projects based on the proportional
§ 200.400 Policy guide. benefit. However, when those § 200.429 Commencement and
* * * * * convocation costs.
proportions cannot be determined
(g) The recipient or subrecipient must because of the interrelationship of the Costs incurred for commencements
not earn or keep any profit resulting work involved, then, notwithstanding and convocations are unallowable.
from Federal financial assistance unless paragraph (c) of this section, the costs ■ 99. In § 200.430, revise paragraph (h)
explicitly authorized by the terms and may be allocated or transferred to and paragraph (i) introductory text to
conditions of the Federal award. See benefited projects on any reasonable read as follows:
also § 200.307. documented basis. Where the purchase § 200.430 Compensation—personal
■ 92. In § 200.401: of equipment or other capital asset is services.
■ a. Remove paragraph (a)(3); specifically authorized under a Federal
■ b. Redesignate paragraphs (a)(4) * * * * *
award, the costs are assignable to the (h) Nonprofit organizations. This
through (6) as paragraphs (a)(3) through Federal award regardless of the use that
(5), respectively; and paragraph (h) provides policy applicable
may be made of the equipment or other only to nonprofit organizations. For
■ c. Revise paragraph (c). capital asset involved, when no longer
The revision reads as follows: compensation to members of nonprofit
needed for the purpose for which it was organizations, trustees, directors,
§ 200.401 Application. originally required. See also §§ 200.310 associates, officers, or the immediate
* * * * * through 200.316 and 200.439. families thereof, a determination must
(c) Exemptions. Some nonprofit * * * * * be made that the compensation is
organizations, because of their size and ■ 96. In § 200.407: reasonable for the actual personal
nature of operations, can be considered ■ a. Remove paragraph (d); services rendered rather than a
to be similar to for-profit organizations ■ b. Redesignate paragraphs (e) through distribution of earnings above actual
in terms of the applicability of cost (l) as paragraphs (d) through (k), costs. Compensation may include
principles. These nonprofit respectively; and director’s and executive committee
organizations must operate under ■ c. Insert a new paragraph (l). member’s fees, incentive awards, off-site
Federal cost principles that apply to for- The revision reads as follows: or incentive pay, location allowances,
profit organizations located at 48 CFR hardship pay, and cost-of-living
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31.2. This exemption only applies to § 200.407 Prior written approval (prior differentials.
approval). (i) Institutions of Higher Education
nonprofit organizations that receive 90
percent or more of their Federal funding * * * * * (IHEs). This paragraph (h) provides
in the form of contracts or operate a (l) Section 200.454 Memberships, policy only applicable to IHEs.
Federally Funded Research and subscriptions, and professional activity * * * * *
Development Center (FFRDC). Federal costs; ■ 100. In § 200.432:
agencies and pass-through entities may * * * * * ■ a. Designate the undesignated
not allow any exceptions to this policy ■ 97. Revise § 200.421 to read as paragraph as paragraph (a); and
under § 200.102(c) unless expressly follows: ■ b. Add paragraph (b).
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32262 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
The addition reads as follows: purposes of legislation or executive rulemaking, or administrative actions
direction; for purposes other than carrying out
§ 200.432 Conferences. (3) Costs of the judicial branch of a objectives of the Federal award;
* * * * * government; * * * * *
(b) The costs for attending (4) Costs of prosecutorial activities ■ 105. Revise § 200.454 to read as
conferences are allowable only if unless treated as a direct cost to a follows:
participation in the conference is specific program if authorized by statute
expressly approved by the Federal or regulation. However, this does not § 200.454 Memberships, subscriptions,
agency and included in the terms and preclude the allowability of other legal and professional activity costs.
conditions of the Federal award. See activities of the Attorney General as (a) Costs of the recipient’s or
§ 200.475. described in § 200.435; and subrecipient’s membership in
■ 101. In § 200.438, revise paragraph (b) (5) Costs of other general types of professional, civic, business, and
to read as follows: government services normally provided technical organizations are allowable if
to the general public, such as fire and necessary to fulfill the award
§ 200.438 Entertainment and prizes.
police, unless provided as a direct cost requirements. Such costs must receive
* * * * * under a program statute or regulation. prior written approval of the Federal
(b) Prizes. Costs of prizes or ■ 104. In § 200.450: agency.
challenges are allowable if they have a ■ a. Revise paragraph (a); (b) Costs of the recipient’s or
specific and direct programmatic ■ b. Redesignate paragraphs (c)(1)(iii) subrecipient’s subscriptions to business,
purpose and are included in the Federal and (iv) as paragraphs (c)(1)(vi) and professional, academic, and technical
award. (vii), respectively; and periodicals are unallowable.
■ 102. In § 200.442, revise paragraphs ■ c. Add new paragraphs (c)(1)(iii) and (c) Costs of membership in any
(b) and (c) to read as follows: (iv) and paragraph (c)(1)(v). country club or social or dining club or
The revision and additions read as organization are unallowable.
§ 200.442 Fundraising and investment
follows: (d) Costs of membership in
management costs.
organizations whose primary purpose is
* * * * * § 200.450 Lobbying.
lobbying or issue advocacy are
(b) Costs of investment counsel and (a) Lobbying costs associated with unallowable. See § 200.450.
staff and similar expenses incurred to obtaining Federal assistance awards. ■ 106. In § 200.455, revise paragraph (c)
enhance income from investments are The costs of certain influencing to read as follows:
unallowable except when associated activities associated with obtaining
with investments covering pension, self- grants, cooperative agreements, § 200.455 Organization costs.
insurance, or other funds, which contracts, or loans are unallowable. * * * * *
include Federal participation allowed Lobbying with respect to certain grants, (c) The costs related to data and
by this part. Such costs are only cooperative agreements, contracts, and evaluation are allowable. Data costs
allowable with the prior written loans is governed by: include (but are not limited to) the
approval of the Federal agency. (1) Relevant statutes, including the expenditures needed to gather, acquire,
(c) Costs related to the physical provisions of 31 U.S.C. 1352; store, track, manage, analyze,
custody and control of monies and (2) Regulations, for example ‘‘New disaggregate, secure, share, publish, or
securities are allowable. Such costs are Restrictions on Lobbying,’’ (55 FR 6739, otherwise use data to administer or
only allowable with the prior written February 26, 1990), including the improve the program, such as data
approval of the Federal agency. definitions; and systems, personnel, data dashboards,
* * * * * (3) Other applicable OMB guidance. cybersecurity, and related items. Data
■ 103. Revise § 200.444 to read as * * * * * costs may also include direct or indirect
follows: (c) * * * costs associated with building
(1) * * * integrated data systems—data systems
§ 200.444 General costs of government. (iii) Establishing, administering, that link individual-level data from
(a) For States, local governments, and contributing to, or paying the expenses multiple State and local government
Indian Tribes, the general costs of of a voter registration campaign, voter agencies for purposes of management,
government are unallowable except as registration drive, or any similar research, and evaluation. Data costs
provided in § 200.475. activity, or paying the expenses of related to integrated data systems
(b) General costs of government are another entity engaged in such should align with the finalized Federal
those costs related to the general activities; grants data standards as published on
activities of the executive, legislative, or (iv) Engaging in issue advocacy or Grants.gov. Evaluation costs include
judicial branches of government, public messaging that promotes or (but are not limited to) evidence
including general activities related to opposes a particular social, political, or reviews, evaluation planning and
public safety, public information, public policy position unrelated to the feasibility assessment, conducting
citizenship, enrollment, or taxation that statutory objectives or performance evaluations, sharing evaluation results,
are not related to a specific Federal requirements of the Federal award, and other personnel or materials costs
award. Unallowable costs may include: including messaging designed to related to the effective building and use
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(1) Salaries and expenses of the Office influence public attitudes on matters of evidence and evaluation for program
of the Governor of a State or the chief not necessary to accomplish the purpose design, administration, or improvement.
executive of a local government or the of the Federal award; ■ 107. Revise § 200.461 to read as
chief executive of an Indian Tribe; (v) Attempting to influence the follows:
(2) Salaries and other expenses of a executive branch of any State
State legislature, tribal council, or government on matters unrelated to the § 200.461 Publication and printing costs.
similar local governmental body, such objectives or performance requirements (a) In general. Except as provided in
as a county supervisor, city council, or of the Federal award, including attempts paragraph (b) of this section, publication
school board, whether incurred for to affect State agency policymaking, costs (including page charges, article
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processing charges (APCs), or similar under Federal awards (48 CFR 31.205– reporting package do not include
fees such as open access fees for 46(a)). personally identifiable information (PII)
professional journal publications and * * * * * and other information subject to
other peer-reviewed publications) are ■ 111. Add § 200.477 to read as follows: protections against disclosure under
unallowable under Federal awards. applicable law.
Printing costs (including distribution § 200.477 Abortion.
* * * * *
and general handling) are allowable. Costs associated with elective ■ 114. In § 200.512, revise paragraphs
(b) Exceptions. The only exceptions to abortions are unallowable, except as (a)(2) and (b)(2)(ii) to read as follows:
paragraph (a) of this section are for expressly authorized by Federal law.
publication costs that are specifically ■ 112. In § 200.503, revise paragraph (b) § 200.512 Report submission.
required by Federal statute or approved to read as follows: (a) * * *
in advance by the Federal agency on a (2) The auditee must make copies
§ 200.503 Relation to other audit available for public inspection unless
case-by-case basis. A general requirements.
requirement to make results publicly restricted by Federal statute or
* * * * * regulation. Auditees and auditors must
available must not be construed as (b) Conducting additional audits.
authorizing publication costs. ensure that their respective parts of the
Notwithstanding paragraph (a) of this reporting package do not include
(c) Requirements. (1) Allowable
section, a Federal agency, Inspector personally identifiable information (PII)
publication costs included in the terms
General, or GAO may conduct or and other information subject to
and conditions of a Federal award must
arrange additional audits to carry out its protections against disclosure under
meet the following requirements:
responsibilities only under applicable applicable law.
(i) The publications report work
Federal statutes. The provisions of this (b) * * *
supported by the Federal Government;
part do not authorize any non-Federal (2) * * *
and
entity to constrain, in any manner, such (ii) The reporting package does not
(ii) The charges are levied impartially
Federal agency from carrying out or include personally identifiable
on all items published by the journal,
arranging for such additional audits, information (PII) and other information
whether or not under a Federal award.
(2) The recipient or subrecipient may except that the Federal agency must subject to protections against disclosure
charge the Federal award during plan such audits not to be duplicative under applicable law;
closeout for the costs of publication or of other audits of Federal awards. Prior * * * * *
sharing of research results if the costs to commencing such an audit, the ■ 115. In § 200.513, revise paragraphs
were not incurred during the period of Federal agency or pass-through entity (c)(4) and (c)(6)(vii) to read as follows:
performance of the Federal award. must review the FAC for recent audits
submitted by the non-Federal entity, § 200.513 Responsibilities.
These costs must be charged to the final
and to the extent such audits meet a * * * * *
budget period of the award unless
Federal agency or pass-through entity’s (c) * * *
otherwise specified by the Federal (4) Provide OMB with updates to the
agency. needs, the Federal agency or pass-
through entity must rely upon and use compliance supplement. These updates
■ 108. Revise § 200.467 to read as
such audits. Any additional audits must include working with OMB to ensure
follows: that the compliance supplement focuses
be planned and performed in such a
§ 200.467 Selling and marketing costs. way as to build upon work performed, the auditor on testing the compliance
Costs of selling and marketing any including the audit documentation, requirements most likely to cause
products or services of the recipient or sampling, and testing already performed improper payments, fraud, waste, abuse,
subrecipient are unallowable unless by other auditors. or generate audit findings for which the
they are expressly included in the * * * * * Federal agency will take action in
Federal award and necessary to meet ■ 113. In § 200.507, revise paragraph accordance with § 200.505. Prior to
the requirements of the Federal award. (c)(1) to read as follows: submitting compliance supplement
■ 109. In § 200.472, revise paragraph
drafts to OMB, Federal agencies should
(a)(5) introductory text to read as § 200.507 Program-specific audits. engage with external audit stakeholders,
follows: * * * * * the Federal agency’s Office of Inspector
(c) * * * General, and the National Single Audit
§ 200.472 Termination and standard (1) Submission deadline and public Coordinator (NSAC).
closeout costs. availability. The audit must be * * * * *
(a) * * * completed and submitted in accordance (6) * * *
(5) The following settlement expenses with paragraph (c)(2) or (3) of this (vii) Ensure the Federal agency
are generally allowable: section. Unless a different period is provides OMB with updates to the
* * * * * specified in the program-specific audit compliance supplement consistent with
■ 110. In § 200.475, revise paragraph (d) guide, the audit must be submitted the compliance supplement preparation
to read as follows: within 30 calendar days after the guide.
auditee receives the auditor’s report(s) * * * * *
§ 200.475 Travel costs. or nine months after the end of the audit ■ 116. In § 200.514, revise paragraph
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* * * * * period (whichever is earlier). The (c)(1) to read as follows:
(d) Establishing rates and amounts. In submission is due the next business day
the absence of an established written when the due date falls on a Saturday, § 200.514 Standards and scope of audit.
policy regarding travel costs, the rates Sunday, or Federal holiday. Unless * * * * *
and amounts established under 5 U.S.C. restricted by Federal law or regulation, (c) * * *
5701–11, by the Administrator of the auditee must make copies of the (1) The compliance supplement
General Services, or by the President (or reporting package available for public provides guidance on internal controls
designee) pursuant to any provisions of inspection. Auditees and auditors must over Federal programs.
such subchapter must apply to travel ensure that their respective parts of the * * * * *
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■ 117. In appendix I to part 200: (D) This section must also include what to SUBTITLE B—FEDERAL AGENCY
■ a. Revise paragraphs (a)(3)(i) through do in the event of system problems and a REGULATIONS FOR GRANTS AND
(viii), (b)(1)(i)(H), (b)(3), and (b)(4)(ii)(A) point of contact who will be available if the AGREEMENTS
and (B); applicant experiences technical difficulties.
CHAPTER III—DEPARTMENT OF HEALTH
■ b. Remove paragraph (b)(4)(ii)(D); (iv) Submission Dates and Times. This
AND HUMAN SERVICES
■ c. Redesignate paragraphs (b)(4)(ii)(E) section must include due dates and times for
through (J) as paragraphs (b)(4)(ii)(D) all submissions. This includes the following: PART 300—UNIFORM
through (I), respectively; and (A) Full applications. ADMINISTRATIVE REQUIREMENTS,
■ d. Revise paragraphs (b)(5)(iii) and (B) Any preliminary submissions, such as COST PRINCIPLES, AND AUDIT
(iv), (b)(6)(iii)(A)(2), and (b)(8)(ii)(C). letters of intent, Statements of Interest (SOI), REQUIREMENTS FOR FEDERAL
The revisions read as follows: white papers, or pre-applications.
AWARDS
(C) Any other submissions required before
Appendix I to Part 200—Full Text of
Federal award separate from the full ■ 121. The authority citation for part
Notice of Funding Opportunity
application. 300 continues to read as follows:
(a) * * * (D) If the funding opportunity is a general
(3) * * * announcement that is open for a period of Authority: 5 U.S.C. 301, 2 CFR part 200.
(i) Basic Information. time with no specific due dates for
(ii) Eligibility. ■ 122. Revise § 300.106 to read as
applications, this section should say so. follows:
(iii) Funding Opportunity Description.
(iv) Application Contents and Format. * * * * *
(v) Submission Requirements and (6) * * * § 300.106 Adoption of 2 CFR part 200.
Deadlines. (iii) * * * The Department of Health and Human
(vi) Application Review Information. (A) * * * Services adopts the Office of
(vii) Award Notices. (2) A brief description of the merit review
(viii) Post-Award Requirements and Management and Budget (OMB)
process, including how the Federal agency regulation in 2 CFR part 200, with the
Administration.
uses merit review (including pre-issuance additions included in this part and part
* * * * * review) outcomes in final decision-making.
(b) * * * 376 of this chapter. This part gives
For example, whether they are advisory only. regulatory effect to the OMB regulation
(1) * * *
(i) * * * * * * * * for Federal awards issued by the
(H) Executive Summary. A brief (8) * * * Department of Health and Human
description that is written in plain language (ii) * * * Services. See 2 CFR 200.110(a)
and summarizes the goals and objectives of (C) The means of submission. regarding the process for amending 2
the program, the target audience, and eligible CFR part 200.
recipients. The text of the executive summary * * * * *
must not exceed 500 words, unless ■ 118. In appendix II to part 200, revise § 300.300 [Removed and Reserved]
authorized by the head of the Federal agency
paragraph (C) to read as follows: ■ 123. Remove and reserve § 300.300.
(or designee).
* * * * * Appendix II to Part 200—Contract ■ 124. Revise § 300.414 to read as
(3) Funding Opportunity Description. This Provisions for Non-Federal Entity follows:
section contains the full description of the Contracts Under Federal Awards
funding opportunity. § 300.414 Indirect costs.
(4) * * * * * * * *
(ii) * * *
In addition to 2 CFR 200.414(c), the
(C) Equal Employment Opportunity.
(A) Limitations on page numbers or words. following specific indirect cost
Except as otherwise provided under 41 CFR
(B) Formatting requirements, including provisions apply:
part 60, all contracts that meet the definition
font and font size, margins, page size, and of ‘‘federally assisted construction contract’’ (a) Indirect costs on training grants are
color limitations. limited to a fixed rate of eight percent
in 41 CFR 60–1.3 must include the equal
* * * * * opportunity clause provided under 41 CFR of MTDC exclusive of tuition and
(5) * * * 60–1.4(b). related fees, direct expenditures for
(iii) Submission Instructions. This section equipment, and subawards in excess of
addresses how the applicant will submit the * * * * *
application. It must include the following:
$25,000; and
(A) Actions needed prior to applying: Appendix VIII to Part 200 [Removed (b) Indirect costs on grants awarded to
Instructions on any registrations required to and Reserved] foreign organizations and foreign public
access electronic submission systems or links entities and performed fully outside of
to them. Where possible, provide the ■ 119. Remove and reserve appendix
the territorial limits of the U.S. may be
expected time frames needed to complete the VIII to part 200. paid to support the costs of compliance
registration process.
■ 120. Revise appendix IX to part 200 to with Federal requirements at a fixed rate
(B) The methods for submitting the
application: read as follows: of eight percent of MTDC exclusive of
(1) The Federal agency must inform tuition and related fees, direct
Appendix IX to Part 200—Hospital Cost expenditures for equipment, and
applicants that applications must be
submitted via Grants.gov, unless a program Principles subawards in excess of $25,000.
specific exception is expressly authorized by Until such time as revised guidance is
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Federal statute or approved by the Federal proposed and implemented for hospitals, the PART 376—NONPROCUREMENT
agency head (or designee). DEBARMENT AND SUSPENSION
(2) The Federal agency must provide a link existing principles located at appendix IX to
to the instructions on how to submit an part 300 of this title remain in effect.
■ 125. The authority citation for part
application.
(C) If applicable, this section also must say
376 continues to read as follows:
how applicants must submit pre- Authority: 5 U.S.C. 301; 31 U.S.C. 6101
applications, letters of intent, Statements of (note); E.O. 12689 (3 CFR, 1989 Comp., p.
Interest (SOI), third-party information, or 235); E.O. 12549 (3 CFR, 1986 Comp., p. 189);
other information required before the award. E.O. 11738 (3 CFR, 1973 Comp., p. 799).
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Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules 32265
§ § 376.10 and 376.30 [Redesignated as regulation in subparts A through I of 2 ■ 133. Revise §§ 382.10 through 382.30
§§ 376.5 and 376.10] CFR part 180 (see table 2 to 2 CFR to read as follows:
■ 126. Redesignate §§ 376.10 and 376.30 180.100(b)), apply to you if you are a—
as §§ 376.5 and 376.10, respectively. (a) Participant or principal in a § 382.10 What does this part do?
■ 127. Revise newly redesignated ‘‘covered transaction’’ under subpart B This part requires that the award and
§§ 376.5 and 376.10 to read as follows: of 2 CFR part 180, as supplemented by administration of Department of Health
§ 376.5 What does this part do? this part, and the definition of and Human Services (HHS) grants and
nonprocurement transaction’’ at 2 CFR cooperative agreements comply with
This part adopts the Office of
180.970. Office of Management and Budget
Management and Budget (OMB)
(b) Respondent in HHS suspension or (OMB) regulation implementing the
regulation in subparts A through I of 2
CFR part 180, as supplemented by this debarment action. portion of the Drug-Free Workplace Act
part, as the Department of Health and (c) HHS debarment or suspension of 1988 (41 U.S.C. 8101–8106, as
Human Services (HHS or Department) official. amended, hereinafter referred to as ‘‘the
policies and procedures for (d) HHS grants officer, agreements Act’’) that applies to grants. This part—
nonprocurement debarment and officer, or other HHS official authorized
to enter into any type of (a) Adopts the OMB regulation
suspension. This part gives regulatory (subparts A through F of 2 CFR part 182)
effect to the OMB regulation for Federal nonprocurement transaction that is a
covered transaction. for the HHS grants and cooperative
awards issued by HHS as supplemented agreements; and
by this part. This part satisfies the ■ 130. Revise § 376.220 to read as
requirements in 2 CFR 180.20, section 3 follows: (b) Establishes HHS policies and
of Executive Order 12549, ‘‘Debarment procedures for compliance with the Act
§ 376.220 What contracts and
and Suspension’’, Executive Order subcontracts, in addition to those listed in that are the same as those of other
12689, ‘‘Debarment and Suspension’’, 2 CFR 180.220, are covered transactions? Federal agencies, in conformance with
and 31 U.S.C. 6101 note (section 2455, the requirement in 41 U.S.C. 8106 for
In addition to the contracts covered
Pub. L. 103–355, 108 Stat. 3327). under 2 CFR 180.220(b), this part also Governmentwide implementing
applies to all lower tiers of subcontracts regulations.
§ 376.10 What policies and procedures
must I follow? under covered nonprocurement § 382.20 Does this part apply to me?
The policies and procedures that you transactions, as permitted under the
must follow are the policies and OMB regulation at 2 CFR 180.220(c). This part and, through this part,
procedures specified in each applicable (See optional lower tier coverage in the pertinent portions of the OMB
section of the OMB regulation in diagram in appendix A to 2 CFR part regulation in subparts A through F of 2
subparts A through I of 2 CFR part 180, 180.) CFR part 182 (see 2 CFR 182.115(b))
including the corresponding sections ■ 131. Revise § 376.437 to read as apply to you if you are a—
that HHS published in this part follows: (a) Recipient of an HHS grant or
identified by the same section number. cooperative agreement; or
§ 376.437 What method do I use to
The contracts under a nonprocurement communicate to a participant the (b) HHS awarding official.
transaction, that are covered requirements described in the OMB
transactions, for example, are specified regulation at 2 CFR 180.435? § 382.30 What policies and procedures
by 2 CFR 180.220 as supplemented by To communicate to a participant the must I follow?
§ 376.220. For any section of OMB requirements described in 2 CFR
regulation in subparts A through I of 2 (a) General. You must follow the
180.435, you must include a term or policies and procedures specified in
CFR part 180 that has no corresponding
condition in the transaction that applicable sections of the OMB
section in this part, HHS policies and
requires the participant’s compliance regulation in subparts A through F of 2
procedures are those in the OMB
with subpart C of 2 CFR part 180, as CFR part 182, as implemented by this
regulation at 2 CFR part 180.
supplemented by subpart C of this part, part.
§ 376.20 [Redesignated as § 376.120 and and require the participant to include a
(b) Specific sections of OMB
Transferred to Subpart A] similar term or condition in lower-tier
regulation that this part supplements. In
■ 128. Redesignate § 376.20 as § 376.120 covered transactions.
implementing the OMB regulation in 2
and transfer newly redesignated
PART 382—REQUIREMENTS FOR CFR part 182, this part supplements
§ 376.120 to subpart A.
■ 129. Revise newly redesignated DRUG–FREE WORKPLACE four sections of the OMB regulation, as
§ 376.120 to read as follows: (FINANCIAL ASSISTANCE) shown in the following table. For each
of those sections, you must follow the
§ 376.120 Does this part apply to me? ■ 132. The authority citation for part policies and procedures in the OMB
This part and, through this part, 382 is revised to read as follows: regulation, as supplemented by this
pertinent portions of the OMB Authority: 41 U.S.C. 8101–8106. part.
Section in this
Section of OMB part where What the supplementation clarifies
khammond on DSK9W7S144PROD with PROPOSALS2
regulation supplemented
(1) 2 CFR 182.225(a) ..... § 382.225 .......... Whom in HHS a recipient other than an individual must notify if an employee is convicted for a
violation of a criminal drug statute in the workplace.
(2) 2 CFR 182.300(b) ..... § 382.300 .......... Whom in HHS a recipient who is an individual must notify if he or she is convicted of a criminal
drug offense resulting from a violation occurring during the conduct of any award activity.
(3) 2 CFR 182.500 ......... § 382.500 .......... Who in HHS is authorized to determine that a recipient other than an individual is in violation of
the requirements of 2 CFR part 182, as implemented by this part.
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32266 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
Section in this
Section of OMB part where What the supplementation clarifies
regulation supplemented
(4) 2 CFR 182.505 ......... § 382.505 .......... Who in HHS is authorized to determine that a recipient who is an individual is in violation of the
requirements of 2 CFR part 182, as implemented by this part.
(c) Sections of the OMB regulation CFR 200.110(a) regarding the process for § 417.30 What policies and procedures
that this part does not supplement. For amending 2 CFR part 200. must I follow?
any section of OMB regulation in The USDA policies and procedures
subparts A through F of 2 CFR part 182 PART 417—NONPROCUREMENT that you must follow are the policies
that is not listed in paragraph (b) of this DEBARMENT AND SUSPENSION and procedures specified in this part
section, HHS policies and procedures and each applicable section of the OMB
■ 138. The authority citation for part
are the same as those in the OMB regulation in subparts A through I of 2
417 continues to read as follows:
regulation. CFR part 180, as that section is
■ 134. Revise § 382.400 to read as Authority: 5 U.S.C. 301; 7 U.S.C. 2209j;
Sec. 2455, Pub. L. 103–355, 108 Stat. 3327
supplemented by the section in this part
follows: with the same section number. The
(31 U.S.C. 6101 note); Pub. L. 101–576, 104
§ 382.400 What method do I use as an Stat. 2838; E.O. 12549 (51 FR 6370, 3 CFR, contracts that are covered transactions,
agency awarding official to obtain a 1986 Comp., p. 189); E.O. 12689 (54 FR for example, are specified by 2 CFR
recipient’s agreement to comply with the 34131, 3 CFR, 1989 Comp., p. 235); 2 CFR 180.220 as supplemented by § 417.220.
OMB regulation? part 180; 7 CFR 2.28. For any section of OMB regulation in
To obtain a recipient’s agreement to ■ 139. Revise §§ 417.10 through 471.30
subparts A through I of 2 CFR part 180
comply with applicable requirements in to read as follows: that has no corresponding section in
the OMB regulation at 2 CFR part 182, this part, USDA policies and procedures
you must include the following term or § 417.10 What does this part do? are those in the OMB regulation.
condition in the award: This part adopts the OMB regulation ■ 140. Revise subparts C and D to read
Drug-free workplace. You as the in subparts A through I of 2 CFR part as follows:
recipient must comply with drug-free 180, as supplemented by this part, as
workplace requirements in subpart B (or the USDA policies and procedures for Subpart C—Responsibilities of
subpart C, if the recipient is an nonprocurement debarment and Participants Regarding Transactions
individual) of part 382, which adopts suspension. This part gives regulatory
the Governmentwide implementation (2 § 417.332 What methods must I use to
effect for the USDA to the OMB pass down requirements to participants in
CFR part 182) of sec. 5152–5158 of the regulation, as supplemented by this lower tier covered transactions with whom
Drug-Free Workplace Act of 1988 (Pub. part. For any section of OMB regulation I intend to do business?
L. 100–690, Title V, Subtitle D; 41 in subparts A through I of 2 CFR part
U.S.C. 8101–8106). 180 that has no corresponding section in You as a participant must include a
this part, USDA policies and procedures term or condition in lower tier covered
CHAPTER IV—DEPARTMENT OF transactions requiring lower tier
AGRICULTURE are those in the OMB regulation. This
part satisfies the requirements in section participants to comply with subpart C of
PART 400—UNIFORM 3 of Executive Order 12549, ‘‘Debarment 2 CFR part 180, as supplemented by this
ADMINISTRATIVE REQUIREMENTS, and Suspension’’ (3 CFR, 1986 Comp., subpart.
COST PRINCIPLES, AND AUDIT p. 189), Executive Order 12689, Subpart D—Responsibilities of
REQUIREMENTS FOR FEDERAL ‘‘Debarment and Suspension’’ (3 CFR, Department of Agriculture Officials
AWARDS 1989 Comp., p. 235), and 31 U.S.C. 6101 Regarding Transactions
■ 135. The authority citation for part
note (section 2455, Pub. L. 103–355, 108
400 continues to read as follows: Stat. 3327). § 417.437 What method do I use to
communicate to a participant the
Authority: 5 U.S.C. 301; 2 CFR part 200. § 417.20 Does this part apply to me? requirements described in the OMB
Through this part, pertinent portions regulation at 2 CFR 180.435?
§ § 400.0, 400.1, and 400.2 [Redesignated
as §§ 400.1, 400.106, and 400.112] of the OMB regulation in subparts A To communicate to a participant the
through I of 2 CFR part 180 (see table requirements described in 2 CFR
■ 136. Redesignate §§ 400.0, 400.1, and
2 to 2 CFR 180.100(b)) apply to you if 180.435, you must include a term or
400.2 as §§ 400.1, 400.106, and 400.112,
you are a: condition in the transaction that
respectively.
■ 137. Revise newly redesignated
(a) Participant or principal in a requires the participant’s compliance
§ 400.106 to read as follows: ‘‘covered transaction’’ (see subpart B of with subpart C of 2 CFR part 180, as
2 CFR part 180 and the definition of supplemented by subpart C of this part,
§ 400.106 Agency implementation. ‘‘nonprocurement transaction’’ at 2 CFR and requires the participant to include
This part adopts the OMB regulation 180.970, as supplemented by §§ 417.215 a similar term or condition in lower tier
khammond on DSK9W7S144PROD with PROPOSALS2
in subparts A through F of 2 CFR part and 417.220); covered transactions.
200, as supplemented by this chapter, as (b) Respondent in a USDA debarment
USDA policies and procedures for and suspension action; PART 421—REQUIREMENTS FOR
uniform administrative requirements, (c) USDA debarment or suspension DRUG—FREE WORKPLACE
cost principles, and audit requirements official; or (FINANCIAL ASSISTANCE)
for Federal awards. This part gives (d) USDA grants officer, agreements
regulatory effect to the OMB regulation, officer, or other official authorized to ■ 141. The authority citation for part
as supplemented by this chapter, for enter into any type of nonprocurement 421 is revised to read as follows:
Federal awards issued by USDA. See 2 transaction that is a covered transaction. Authority: 41 U.S.C. 8101–8106.
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■ 142. Revise §§ 421.10 through 421.30 (b) Establishes USDA policies and § 421.30 What policies and procedures
to read as follows: procedures for compliance with the Act must I follow?
that are the same as those of other (a) General. You must follow the
§ 421.10 What does this part do? policies and procedures specified in
Federal agencies, in conformance with
This part requires that the award and the requirement in 41 U.S.C. 8106 for applicable sections of the OMB
administration of U.S. Department of Governmentwide implementing regulation in subparts A through F of 2
Agriculture (USDA) grants and regulations. CFR part 182, as implemented by this
cooperative agreements comply with the part.
Office of Management and Budget § 421.20 Does this part apply to me? (b) Specific sections of OMB
(OMB) regulation implementing the This part and, through this part, regulation that this part supplements. In
portion of the Drug-Free Workplace Act pertinent portions of the OMB implementing the OMB regulation in 2
of 1988 (41 U.S.C. 8101–8106, as regulation in subparts A through F of 2 CFR part 182, this part supplements
amended, hereinafter referred to as ‘‘the CFR part 182 (see 2 CFR 182.115(b)) four sections of the OMB regulation, as
Act’’) that applies to grants. This part— shown in the following table. For each
apply to you if you are a—
(a) Adopts the OMB regulation of those sections, you must follow the
(subparts A through F of 2 CFR part 182) (a) Recipient of a USDA grant or policies and procedures in the OMB
for USDA’s grants and cooperative cooperative agreement; or regulation, as supplemented by this
agreements; and (b) USDA awarding official. part.
Section in this
Section of OMB part where What the supplementation clarifies
regulation supplemented
(1) 2 CFR 182.225(a) ..... § 421.225 .......... Whom in the USDA a recipient other than an individual must notify if an employee is convicted for
a violation of a criminal drug statute in the workplace.
(2) 2 CFR 182.300(b) ..... § 421.300 .......... Whom in the USDA a recipient who is an individual must notify if he or she is convicted of a
criminal drug offense resulting from a violation occurring during the conduct of any award activ-
ity.
(3) 2 CFR 182.500 ......... § 421.500 .......... Who in the USDA is authorized to determine that a recipient other than an individual is in violation
of the requirements of 2 CFR part 182, as implemented by this part.
(4) 2 CFR 182.505 ......... § 421.505 .......... Who in the USDA is authorized to determine that a recipient who is an individual is in violation of
the requirements of 2 CFR part 182, as implemented by this part.
(c) Sections of the OMB regulation CHAPTER VI—DEPARTMENT OF STATE of these subparts would be inconsistent
that this part does not supplement. For with the international obligations of the
any section of OMB regulation in PART 600—THE UNIFORM United States or the statute or
subparts A through F of 2 CFR part 182 ADMINISTRATIVE REQUIREMENTS, regulations of a foreign government. The
COST PRINCIPLES, AND AUDIT Federal Acquisition Regulation (FAR) at
that is not listed in paragraph (b) of this
REQUIREMENTS FOR FEDERAL 48 CFR parts 30 and 31 takes
section, USDA policies and procedures
AWARDS precedence over the cost principles in
are the same as those in the OMB
regulation. ■ 144. The authority citation for part subpart E of 2 CFR part 200 for Federal
600 continues to read as follows: awards to U.S. and foreign for-profit
■ 143. Revise § 421.400 to read as
entities.
follows: Authority: 5 U.S.C. 301; 22 U.S.C 2651a, (b) This part gives regulatory effect to
22 U.S.C. 2151, 22 U.S.C. 2451, 22 U.S.C.
§ 421.400 What method do I use as an
the OMB regulation for Federal awards
1461, 2 CFR part 200.
agency awarding official to obtain a issued by the Department of State. See
■ 145. Revise § 600.101 to read as 2 CFR 200.110(a) regarding the process
recipient’s agreement to comply with the
OMB regulation?
follows: for amending 2 CFR part 200.
■ 146. Add § 600.201 to read as follows:
To obtain a recipient’s agreement to § 600.101 Applicability.
comply with applicable requirements in (a) The Department of State adopts the § 600.201 Use of grants and cooperative
Office of Management and Budget agreements.
the OMB regulation at 2 CFR part 182,
you must include the following term or (OMB) regulation in 2 CFR part 200, as Notwithstanding 2 CFR 200.201(b),
condition in the award: follows: the DOS is permitted to issue fixed
(1) The Uniform Administrative amount awards for Foreign Assistance
Drug-free workplace. You as the Requirements, Cost Principles, and and Public Diplomacy programs
recipient must comply with drug-free Audit Requirements for Federal Awards according to DOS internal policies and
workplace requirements in subpart B (or set forth in 2 CFR part 200 (subparts A procedures that support the effective
subpart C, if the recipient is an through F) shall apply to all non-Federal oversight and financial management of
individual) of 2 CFR part 421, which entities, except as noted in paragraph such awards.
khammond on DSK9W7S144PROD with PROPOSALS2
adopts the Governmentwide (a)(2) of this section.
implementation (2 CFR part 182) of sec. § 600.205 [Redesignated as § 600.206]
(2) Subparts A through E of 2 CFR
5152–5158 of the Drug-Free Workplace part 200 shall apply to all foreign ■ 147. Redesignate § 600.205 as
Act of 1988 (Pub. L. 100–690, Title V, organizations not recognized as Foreign § 600.206.
Subtitle D; 41 U.S.C. 8101–8106). Public Entities and subparts A through
PART 601—NONPROCUREMENT
D of 2 CFR part 200 shall apply to all
DEBARMENT AND SUSPENSION
U.S. and foreign for-profit entities,
except where the Federal awarding ■ 148. The authority citation for part
agency determines that the application 601 continues to read as follows:
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32268 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
Authority: Sec. 2455, Pub. L. 103–355, its agent or representative in any ■ 153. Revise §§ 801.10 through 801.30
108; Stat. 3327 (31 U.S.C. 6101 note); E.O. transaction, if the contract is to be to read as follows:
12549; (3 CFR, 1986 Comp., p. 189); E.O. funded or provided by the DOS under
12689 (3); CFR, 1989 Comp., p. 235). § 801.10 What does this part do?
a covered nonprocurement transaction
■ 149. Revise §§ 601.10 through 601.30 and the amount of the contract is This part adopts the Office of
to read as follows: expected to equal or exceed $25,000. Management and Budget (OMB)
This extends the coverage of the DOS regulation in subparts A through I of 2
§ 601.10 What does this part do? CFR part 180, as supplemented by this
nonprocurement suspension and
This part adopts the Office of debarment requirements to all lower part, as the Department of Veterans
Management and Budget (OMB) tiers of subcontracts under covered Affairs (VA) policies and procedures for
regulation in subparts A through I of 2 nonprocurement transactions, as nonprocurement debarment and
CFR part 180, as supplemented by this permitted under the OMB regulation at suspension. This part gives regulatory
part, as the Department of State (DOS) 2 CFR 180.220(c) (see optional lower effect to the OMB regulation, as
policies and procedures for tier coverage in the figure in appendix supplemented by this part, for the
nonprocurement debarment and A to 2 CFR part 180). Department of Veteran Affairs. This part
suspension. This part gives regulatory satisfies the requirements in section 3 of
effect for DOS to the OMB regulation as Subpart C—Responsibilities of Executive Order 12549, ‘‘Debarment and
supplemented by this part. This part Participants Regarding Transactions Suspension’’ (3 CFR, 1986 Comp., p.
satisfies the requirements in section 3 of 189), Executive Order 12689,
Executive Order 12549, ‘‘Debarment and § 601.332 What methods must I use to ‘‘Debarment and Suspension’’ (3 CFR,
Suspension’’ (3 CFR, 1986 Comp., p. pass requirements down to participants at 1989 Comp., p. 235), and 31 U.S.C. 6101
lower tiers with whom I intend to do note (section 2455, Pub. L. 103–355, 108
189); Executive Order 12689, business?
‘‘Debarment and Suspension’’ (3 CFR, Stat. 3327).
1989 Comp., p. 235); and section 2455 You, as a participant, must include a
term or condition in lower-tier § 801.20 Does this part apply to me?
of the Federal Acquisition Streamlining
transactions requiring lower-tier This part and, through this part,
Act of 1994, Public Law 103–355 (31
participants to comply with subpart C of pertinent portions of the OMB
U.S.C. 6101 note).
2 CFR part 180, as supplemented by this regulation in subparts A through I of 2
§ 601.20 Does this part apply to me? subpart. CFR part 180 (see table 2 to 2 CFR
This part and, through this part, 180.100(b)) apply to you if you are a—
pertinent portions of the OMB Subpart D—Responsibilities of Federal (a) Participant or principal in a
regulation in subparts A through I of 2 Agency Officials Regarding ‘‘covered transaction’’ (see subpart B of
CFR part 180 (see table 2 to 2 CFR Transactions 2 CFR part 180 and the definition of
180.100(b)) apply to you if you are a— ‘‘nonprocurement transaction’’ at 2 CFR
§ 601.437 What method do I use to 180.970, as supplemented by subpart B
(a) Participant or principal in a communicate to a participant the
‘‘covered transaction’’ (see subpart B of of this part);
requirements described in the OMB (b) Respondent in a Department of
2 CFR part 180 and the definition of regulation at 2 CFR 180.435?
Veterans Affairs debarment or
‘‘nonprocurement transaction’’ at 2 CFR
To communicate to a participant the suspension action;
180.970);
requirements described in 2 CFR (c) Department of Veterans Affairs
(b) Respondent in a DOS suspension
180.435, you must include a term or debarment or suspension official; or
or debarment action; (d) Department of Veterans affairs
(c) DOS debarment or suspension condition in the transaction that
requires the participant’s compliance grants officer, agreements officer, or
official; and other official authorized to enter into
(d) DOS grants officer, agreements with subpart C of 2 CFR part 180, as
supplemented by subpart C of this part, any type of nonprocurement transaction
officer, or other official authorized to
and requires the participant to include that is a covered transaction.
enter into any type of nonprocurement
transaction that is a covered transaction. a similar term or condition in lower-tier
§ 801.30 What policies and procedures
covered transactions. must I follow?
§ 601.30 What policies and procedures
must I follow?
CHAPTER VII—AGENCY FOR For any section of OMB regulation in
INTERNATIONAL DEVELOPMENT subparts A through I of 2 CFR part 180
The DOS policies and procedures that [REMOVED] that has no corresponding section in
you must follow are the policies and this part, Department of Veterans Affairs
■ 151. Under the authority of 5 U.S.C.
procedures specified in each applicable policies and procedures are those in the
301; Sec. 621, Public Law 87–195, 75
section of the OMB regulation in OMB regulation. For any such section
Stat 445, (22 U.S.C. 2381) as amended,
subparts A through I of 2 CFR part 180 where there is a corresponding section
E.O. 12163, Sept 29, 1979, 44 FR 56673;
and any supplemental policies and in this part, the Department of Veterans
2 CFR 1979 Comp., p. 435, remove
procedures set forth in this part. Affairs policies and procedures that you
chapter VII.
■ 150. Revise subparts B through D to
must follow are the policies and
read as follows: CHAPTER VIII—DEPARTMENT OF
procedures specified in each applicable
VETERANS AFFAIRS
Subpart B—Covered Transactions section of the OMB regulation in
khammond on DSK9W7S144PROD with PROPOSALS2
PART 801—NONPROCUREMENT subparts A through I of 2 CFR part 180,
§ 601.220 What contracts and DEBARMENT AND SUSPENSION and as supplemented by the section in
subcontracts, in addition to those listed in this part with the same section number.
2 CFR 180.220, are covered transactions? ■ 152. The authority citation for part The contracts that are covered
In addition to the contracts covered 801 continues to read as follows: transactions, for example, are specified
under 2 CFR 180.220(b), this part Authority: Sec. 2455, Pub. L. 103–355, 108 by 2 CFR 180.220 as supplemented by
applies to any contract, regardless of Stat. 3327; E.O. 12549, 3 CFR, 1986 Comp., § 801.220.
tier, that is awarded by a contractor, p. 189; E.O. 12689, 3 CFR, 1989 Comp., p. ■ 154. Revise subparts A through D to
subcontractor, supplier, consultant, or 235; 38 U.S.C. 501(a) and 3703(c). read as follows:
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Subpart A—General Subpart J—Limited Denial of § 901.20 Does this part apply to me?
Participation (Optional Regulations for This part and, through this part,
§ 801.137 Who in the Department of OMB Regulations at 2 CFR Part 180) pertinent portions of the OMB
Veterans Affairs may grant an exception to regulation in subparts A through I of 2
allow an excluded person to participate in PART 802—UNIFORM CFR part 180 (see table 2 to 2 CFR
a covered transaction? ADMINISTRATIVE REQUIREMENTS, 180.100(b)) apply to you if you are a—
Within the Department of Veterans COST PRINCIPLES, AND AUDIT (a) Participant or principal in a
Affairs, the Secretary of Veterans REQUIREMENTS FOR FEDERAL ‘‘covered transaction’’ (see subpart B of
Affairs, the Under Secretary for Health, AWARDS 2 CFR part 180 and the definition of
the Under Secretary for Benefits, the ‘‘nonprocurement transaction’’ at 2 CFR
■ 156. The authority citation for part 180.970);
Under Secretary for Memorial Affairs, or
other Designee of the Secretary each has 802 continues to read as follows: (b) Respondent in a DOE suspension
the authority to grant an exception to Authority: 5 U.S.C. 301; 38 U.S.C. 501, 2 or debarment action;
CFR part 200, and as noted in specific (c) DOE debarment or suspension
allow an excluded person to participate
sections. official; and
in a covered transaction, as provided in (d) DOE grants officer, agreements
the OMB regulation at 2 CFR 180.135. officer, or other official authorized to
■ 157. Revise § 802.101 to read as
follows: enter into any type of nonprocurement
Subpart B—Covered Transactions
transaction that is a covered transaction.
§ 802.101 Applicability.
§ 801.220 What contracts and
§ 901.30 What policies and procedures
subcontracts, in addition to those listed in The Uniform Administrative must I follow?
2 CFR 180.220, are covered transactions? Requirements, Cost Principles, and The DOE policies and procedures that
VA does not extend coverage of Audit Requirements for Federal Awards you must follow are the policies and
nonprocurement suspension and set forth in 2 CFR part 200 shall apply procedures specified in each applicable
debarment requirements beyond first- to the Department of Veterans Affairs. section of the OMB regulation in
tier procurement contracts under a This part gives regulatory effect to the subparts A through I of 2 CFR part 180
covered nonprocurement transaction, OMB regulation for Federal awards and any supplemental policies and
issued by the Department of Veterans procedures set forth in this part.
although the OMB regulation at 2 CFR
Affairs. See 2 CFR 200.110(a) regarding ■ 160. Revise subparts B through D to
180.220(c) allows a Federal agency to do
the process for amending 2 CFR part read as follows:
so (also see optional lower tier coverage
200.
in the figure in appendix A to 2 CFR
part 180). CHAPTER IX—DEPARTMENT OF ENERGY Subpart B—Covered Transactions
§ 901.220 What contracts and
Subpart C—Responsibilities of PART 901—NONPROCUREMENT subcontracts, in addition to those listed in
Participants Regarding Transactions DEBARMENT AND SUSPENSION 2 CFR 180.220, are covered transactions?
Although the OMB regulation at 2
§ 801.332 What methods must I use to ■ 158. The authority citation for part
pass requirements down to participants at
CFR180.220(c) allows a Federal agency
901 continues to read as follows:
lower tiers with whom I intend to do to do so (also see optional lower tier
Authority: Sec. 2455, Pub. L. 103–355, 108 coverage in the figure in appendix A to
business?
Stat. 3327 (31 U.S.C. 6101 note); E.O. 12549 2 CFR part 180), DOE does not extend
You as a participant must include a (3 CFR, 1986 Comp., p. 189); E.O. 12689 (3 coverage of nonprocurement suspension
term or condition in lower-tier CFR, 1989 Comp., p. 235); 42 U.S.C. 7101 et and debarment requirements beyond
transactions requiring lower-tier seq.; 50 U.S.C. 2401 et seq. first-tier procurement contracts under a
participants to comply with subpart C of covered nonprocurement transaction.
■ 159. Revise §§ 901.10 through 901.30
2 CFR part 180, as supplemented by this to read as follows:
subpart. Subpart C—Responsibilities of
§ 901.10 What does this part do? Participants Regarding Transactions
Subpart D—Responsibilities of Federal
Agency Officials Regarding This part adopts the Office of § 901.332 What methods must I use to
Management and Budget (OMB) pass requirements down to participants at
Transactions lower tiers with whom I intend to do
regulation in subparts A through I of 2
CFR part 180, as supplemented by this business?
§ 801.437 What method do I use to
communicate to a participant the part, as the Department of Energy (DOE) You, as a participant, must include a
requirements described in the OMB policies and procedures for term or condition in lower-tier
regulation at 2 CFR 180.435? nonprocurement debarment and transactions requiring lower-tier
suspension. This part gives regulatory participants to comply with subpart C of
To communicate to a participant the 2 CFR part 180, as supplemented by this
requirements described in 2 CFR effect to the OMB regulation for Federal
awards issued by DOE as supplemented subpart.
180.435, you must include a term or
by this part. This part satisfies the
condition in the transaction that Subpart D—Responsibilities of Federal
khammond on DSK9W7S144PROD with PROPOSALS2
requirements in section 3 of Executive
requires the participant’s compliance Agency Officials Regarding
Order 12549, ‘‘Debarment and
with subpart C of 2 CFR part 180 (as Transactions
Suspension’’ (3 CFR, 1986 Comp., p.
supplemented by subpart C of this part) 189); Executive Order 12689, § 901.437 What method do I use to
and requires the participant to include ‘‘Debarment and Suspension’’ (3 CFR, communicate to a participant the
a similar term or condition in lower-tier 1989 Comp., p. 235); and section 2455 requirements described in the OMB
covered transactions. of the Federal Acquisition Streamlining regulation at 2 CFR 180.435?
■ 155. Revise the heading of subpart J to Act of 1994, Public Law 103–355 (31 To communicate to a participant the
read as follows: U.S.C. 6101 note). requirements described in 2 CFR
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32270 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
180.435, you must include a term or agreements comply with Office of CFR part 182 (see 2 CFR 182.115(b))
condition in the transaction that Management and Budget (OMB) apply to you if you are a—
requires the participant’s compliance regulation implementing the portion of (a) Recipient of a DOE grant or
with subpart C of 2 CFR part 180, as the Drug-Free Workplace Act of 1988 cooperative agreement; or
supplemented by subpart C of this part, (41 U.S.C. 701–707, as amended, (b) DOE awarding official.
and requires the participant to include hereinafter referred to as ‘‘the Act’’) that
a similar term or condition in lower-tier applies to grants. This part— § 902.30 What policies and procedures
must I follow?
covered transactions. (a) Gives regulatory effect to the OMB (a) General. You must follow the
regulation (subparts A through F of 2 policies and procedures specified in
PART 902—REQUIREMENTS FOR
CFR part 182) for the DOE’s grants and applicable sections of the OMB
DRUG–FREE WORKPLACE
cooperative agreements; and regulation in subparts A through F of 2
(FINANCIAL ASSISTANCE)
(b) Establishes DOE policies and CFR part 182, as implemented by this
■ 161. The authority citation for part procedures for compliance with the Act part.
902 continues to read as follows: that are the same as those of other (b) Specific sections of OMB
Authority: 41 U.S.C. 701; 42 U.S.C. 7101 Federal agencies, in conformance with regulation that this part supplements. In
et seq.; 50 U.S.C. 2401 et seq. the requirement in 41 U.S.C. 705 for implementing the OMB regulation in 2
■ 162. Revise §§ 902.10 through 902.30 Governmentwide implementing CFR part 182, this part supplements
to read as follows: regulations. four sections of the OMB regulation, as
shown in the following table. For each
§ 902.10 What does this part do? § 902.20 Does this part apply to me?
of those sections, you must follow the
This part requires that the award and This part and, through this part, policies and procedures in the OMB
administration of Department of Energy pertinent portions of the OMB regulation, as supplemented by this
(DOE) grants and cooperative regulation in subparts A through F of 2 part.
Section in this
Section of OMB part where What the supplementation clarifies
regulation supplemented
(1) 2 CFR § 902.225 .......... Whom in the DOE a recipient other than an individual must notify if an employee is convicted for a vio-
182.225(a). lation of a criminal drug statute in the workplace.
(2) 2 CFR § 902.300 .......... Whom in the DOE a recipient who is an individual must notify if he or she is convicted of a criminal
182.300(b). drug offense resulting from a violation occurring during the conduct of any award activity.
(3) 2 CFR 182.500 § 902.500 .......... Who in the DOE is authorized to determine that a recipient other than an individual is in violation of the
requirements of 2 CFR part 182, as implemented by this part.
(4) 2 CFR 182.505 § 902.505 .......... Who in the DOE is authorized to determine that a recipient who is an individual is in violation of the re-
quirements of 2 CFR part 182, as implemented by this part.
(5) 2 CFR 182.605 § 902.605 .......... Definition of ‘‘Award’’.
(6) 2 CFR 182.645 § 902.645 .......... Definition of ‘‘Federal agency or agency’’.
(c) Sections of the OMB regulation L. 100–690, Title V, Subtitle D; 41 Department of Energy. See 2 CFR
that this part does not supplement. For U.S.C. 701–707). 200.110(a) regarding the process for
any section of OMB regulation in amending 2 CFR part 200.
subparts A through F of 2 CFR part 182 PART 910—UNIFORM
■ 167. Revise § 910.350 to read as
that is not listed in paragraph (b) of this ADMINISTRATIVE REQUIREMENTS,
follows:
section, DOE policies and procedures COST PRINCIPLES, AND AUDIT
are the same as those in the OMB REQUIREMENTS FOR FEDERAL § 910.350 Applicability of 2 CFR part 200.
regulation. AWARDS
(a) As stated in § 910.122, unless
■ 163. Revise § 902.400 to read as ■ 164. The authority citation for part otherwise noted in this part, the
follows: 910 continues to read as follows: definition of Non-Federal entity found
Authority: 42 U.S.C. 7101, et seq.; 31 in 2 CFR 200.1 is expanded for DOE to
§ 902.400 What method do I use as an include for-profit organizations in
U.S.C. 6301–6308; 50 U.S.C. 2401 et seq.; 2
agency awarding official to obtain a addition to States, local governments,
CFR part 200.
recipient’s agreement to comply with the Indian tribes, institutions of higher
OMB regulation? §§ 910.120 and 910.122 [Redesignated as education (IHE), and nonprofit
§§ 910.100 and 910.101] organizations.
To obtain a recipient’s agreement to
comply with applicable requirements in ■ 165. Redesignate §§ 910.120 and
(b) A for-profit organization is defined
the OMB regulation at 2 CFR part 182, 910.122 as §§ 910.100 and 910.101.
as one that distributes any profit not
■ 166. Revise newly redesignated
you must include the following term or reinvested into the business as profit or
condition in the award: § 910.101 to read as follows:
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dividends to its employees or
Drug-free workplace. You as the § 910.101 Purpose. shareholders.
recipient must comply with drug-free The Department of Energy adopts the (c) This subpart contains specific
workplace requirements in subpart B (or Office of Management and Budget changes to 2 CFR part 200 that apply
subpart C, if the recipient is an (OMB) regulation in 2 CFR part 200, only to For-Profit Recipients and, unless
individual) of Part 902, which adopts with the additions included in subparts otherwise specified, subrecipients. In
the Governmentwide implementation (2 B through F of this part. This part gives some cases, the coverage in this subpart
CFR part 182) of sec. 5152–5158 of the regulatory effect to the OMB regulation will replace the language in a specific
Drug-Free Workplace Act of 1988 (Pub. for Federal awards issued by the section of 2 CFR part 200.
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Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules 32271
CHAPTER X—DEPARTMENT OF THE agreements to the standard award requirements to be included in any
TREASURY format specified in part 1120 of the DoD award-specific terms and conditions of
Grant and Agreement Regulations DoD Components’ grants and
PART 1000—UNIFORM (DoDGARS) (2 CFR part 1120). The cooperative agreements awarded to for-
ADMINISTRATIVE REQUIREMENTS, standard format provides locations profit entities.
COST PRINCIPLES, AND AUDIT within the award for:
REQUIREMENTS FOR FEDERAL (a) General terms and conditions, § 1104.15 Regulations governing DoD
AWARDS including the administrative and Components’ internal procedures.
■ 168. The authority citation for part national policy requirements discussed On an interim basis pending
1000 continues to read as follows: in § 1104.5(a) and (b), respectively. completion of the update of the
(b) Any award-specific terms and DoDGARs to implement OMB regulation
Authority: 5 U.S.C. 301; 31 U.S.C. 301; 2 conditions discussed in § 1104.10. published in 2 CFR part 200, DoD
CFR part 200.
Components’ internal pre-award, time-
■ 169. Revise § 1000.10 to read as § 1104.5 Regulations governing DoD of-award, and post-award procedures
follows: Components’ general terms and conditions.
will continue to comply with
(a) Administrative requirements. On requirements in parts 21 and 22 of the
§ 1000.10 Applicable regulations. an interim basis pending completion of DoDGARs (32 CFR parts 21 and 22) and
Except for the deviations set forth the update of the DoDGARs to other applicable Defense Grant and
elsewhere in this part, the Department implement OMB regulation published Agreement Regulatory System (DGARS)
of the Treasury adopts the Uniform in 2 CFR part 200, the following policies.
Administrative Requirements, Cost regulatory provisions govern the
Principles, and Audit Requirements for administrative requirements to be § 1104.20 Definitions.
Federal Awards, set forth at 2 CFR part included in general terms and (a) DoD Grant and Agreement
200, for Federal awards issued by the conditions of DoD Components’ new Regulations. The term DoD Grant and
Department. This part gives regulatory grants and cooperative agreements: Agreement Regulations (DoDGARs)
effect to the Office of Management and (1) The provisions of parts 1126 means the regulations in 32 CFR subtitle
Budget (OMB) regulation for Federal through 1138 of the DoDGARs (2 CFR A, chapter I, subchapter C, and this
awards issued by the Department of the parts 1126 through 1138, which chapter.
Treasury. See 2 CFR 200.110(a) comprise subchapter D of this chapter) (b) Other terms. See part 1108 of the
regarding the process for amending 2 govern the administrative requirements DoDGARs (2 CFR part 1108) for
CFR part 200. to be included in the general terms and definitions of other terms used in this
conditions of DoD Components’ new part.
CHAPTER XI—DEPARTMENT OF DEFENSE
grants and cooperative agreements
■ 170. Revise part 1104 to read as awarded to institutions of higher PART 1120—AWARD FORMAT FOR
follows: education, nonprofit organizations, DOD GRANTS AND COOPERATIVE
States, local governments, and Indian AGREEMENTS
PART 1104—IMPLEMENTATION OF
tribes.
GOVERNMENTWIDE REGULATION (2) Part 34 of the DoDGARs (32 CFR ■ 171. The authority citation for part
FOR FEDERAL FINANCIAL part 34) governs the administrative 1120 continues to read as follows:
ASSISTANCE requirements to be included in general Authority: 5 U.S.C. 301 and 10 U.S.C. 113.
Sec. terms and conditions of DoD
■ 172. Revise § 1120.405 to read as
1104.2 Purpose of this part. Components’ grants and cooperative
follows:
1104.3 Award format for DoD Components’ agreements awarded to for-profit
grants and cooperative agreements. entities. § 1120.405 Content of the preamble.
1104.5 Regulations governing DoD (b) National policy requirements. Part
Components’ general terms and The preamble for each set of general
1122 of the DoDGARs (2 CFR part 1122) terms and conditions must include at
conditions.
1104.10 Regulations governing DoD
governs the national policy least the following information
Components’ award-specific terms and requirements to be included in DoD elements, organized in the order shown:
conditions. Components’ new grants and (a) Table of contents. This should
1104.15 Regulations governing DoD cooperative agreements awarded to all show the articles within each other
Components’ internal procedures. types of entities. subdivision of the general terms and
1104.20 Definitions.
§ 1104.10 Regulations governing DoD conditions (Subdivisions B and C for
Authority: 5 U.S.C. 301 and 10 U.S.C. 113. Components’ award-specific terms and administrative and national policy
§ 1104.2 Purpose of this part. conditions. requirements and, if needed,
On an interim basis pending Subdivision D for programmatic
Except as otherwise provided in this
completion of the update of the requirements).
part, the Department of Defense (DoD)
DoDGARs to implement OMB regulation (b) Scope. This element identifies the
adopts the Office of Management and
published in 2 CFR part 200: programs, types of awards, and types of
Budget (OMB) regulation in 2 CFR part
(a) The regulation in 2 CFR part 200 recipient entities that are subject to the
200. Subject to certain exceptions, this
governs administrative requirements to set of general terms and conditions.
part gives regulatory effect to the OMB
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be included in any award-specific terms (c) Effective date. This is the date on
regulation for Federal awards issued by
and conditions used to supplement the which the particular version of the set
DoD. See 2 CFR 200.110(a) regarding the
general terms and conditions of a new of general terms and conditions became
process for amending 2 CFR part 200.
grant or cooperative agreement awarded effective, which enables a recipient to
§ 1104.3 Award format for DoD to an institution of higher education, easily distinguish it from any earlier or
Components’ grants and cooperative nonprofit organization, State, local subsequent versions. The version date of
agreements. government, or Indian tribe. each article within the general terms
DoD Components must conform the (b) Part 34 of the DoDGARs (32 CFR and conditions must be indicated in
format of new grants and cooperative part 34) governs the administrative parentheses following the title of the
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32272 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
article, to help a recipient identify the requirements for general terms and projects under the authority of section
articles that changed from previous conditions of DoD grants and 845 of the National Defense
versions of the general terms and cooperative agreements to institutions of Authorization Act for Fiscal Year 1994
conditions. higher education and other nonprofit (Pub. L. 103–160), as amended. The
(d) English language. The purpose of organizations, States, local governments, Director of Defense Procurement and
this element of the preamble is to and Indian tribes. Acquisition Policy maintains a DoD
implement Office of Management and (2) National policy requirements, to issuance separate from this part that
Budget (OMB) regulation in 2 CFR the extent they apply, for general terms addresses section 845 transactions.
200.111(b) by informing each recipient and conditions of DoD awards to for-
that all Federal financial assistance profit firms, foreign organizations, and § 1125.30 Does this part apply to me?
announcements, applications, and foreign public entities. This part and, through this part,
Federal award information must be in pertinent portions of the OMB
the English language and must be in PART 1125—NONPROCUREMENT regulation in subparts A through I of 2
terms of U.S. dollars. DEBARMENT AND SUSPENSION CFR part 180 (see table 2 to 2 CFR
(e) Plain language. This section of the 180.100(b)) apply to you if you are a—
■ 175. The authority citation for part
preamble is required when the general (a) Participant or principal in a
terms and conditions use personal 1125 continues to read as follows:
‘‘covered transaction’’ (see subpart B of
pronouns, in accordance with Authority: Sec. 2455, Pub. L. 103–355, 108 2 CFR part 180 and the definition of
§ 1120.310. Its purpose is to inform Stat. 3327; E.O. 12549, 3 CFR, 1986 Comp.,
‘‘nonprocurement transaction’’ at 2 CFR
recipients about the meanings of those p. 189; E.O. 12689, 3 CFR, 1989 Comp., p.
235; 5 U.S.C. 301 and 10 U.S.C. 113. 180.970, as supplemented by subpart B
personal pronouns. of this part), other than a section 845
(f) Definitions. Providing the ■ 176. Revise §§ 1125.10 through transaction described in § 1125.20;
definitions of words and phrases that 1125.40 to read as follows: (b) Respondent in a DoD Component’s
are used in the general terms and nonprocurement suspension or
conditions and defined in the DoDGARs § 1125.10 What does this part do?
This part adopts the Office of debarment action;
is more helpful to recipients than
Management and Budget (OMB) (c) DoD Component’s debarment or
referring them to the DoDGARs to find
regulation in subparts A through I of 2 suspension official; or
the definitions.
CFR part 180, as supplemented by this (d) DoD Component’s grants officer,
PART 1122—NATIONAL POLICY part, as the Department of Defense agreements officer, or other official
REQUIREMENTS: GENERAL AWARD (DoD) policies and procedures for authorized to enter into a
TERMS AND CONDITIONS nonprocurement debarment and nonprocurement transaction that is a
suspension. This part implements, for covered transaction.
■ 173. The authority citation for part
1122 continues to read as follows: the Department of Defense, the OMB § 1125.40 What policies and procedures
regulation as supplemented by this part. must I follow?
Authority: 5 U.S.C. 301 and 10 U.S.C. 113. This part satisfies the requirements in
(a) General. You must follow the
■ 174. Revise § 1122.1 to read as section 3 of Executive Order 12549,
policies and procedures specified in
follows: ‘‘Debarment and Suspension’’ (3 CFR,
applicable sections of the OMB
1986 Comp., p. 189), Executive Order
§ 1122.1 Purpose of this part. regulation in subparts A through I of 2
12689, ‘‘Debarment and Suspension’’ (3
(a) This part specifies a standard CFR part 180, as implemented by this
CFR, 1989 Comp., p. 235), and 31 U.S.C.
format and standard wording of general part.
6101 note (section 2455, Pub. L. 103–
terms and conditions for Subdivision B 355, 108 Stat. 3327). (b) Specific sections of OMB
of the general terms and conditions of regulation that this part supplements. In
Department of Defense (DoD) grants and § 1125.20 Does this part implement the implementing the OMB regulation in 2
cooperative agreements, which concerns OMB regulation in 2 CFR part 180 for all CFR part 180, this part supplements
national policy requirements. DoD nonprocurement transactions? eight sections of the OMB regulation, as
(b) This part implements: This part implements the OMB shown in the following table. For each
(1) Office of Management and Budget guidelines in 2 CFR part 180 for most of those sections, you must follow the
(OMB) regulation in 2 CFR 200.210 and DoD nonprocurement transactions. policies and procedures in the OMB
200.300, as those sections of 2 CFR part However, it does not implement the regulation, as supplemented by this
200 relate to national policy guidelines as they apply to prototype part.
Section in this
Section of OMB part where What the supplementation clarifies
regulation supplemented
(1) 2 CFR 180.135 .. § 1125.137 ........ Who in DoD may grant an exception for an excluded person to participate in a covered transaction.
(2) 2 CFR 180.220 .. § 1125.220 ........ Which lower-tier contracts under a nonprocurement transaction are covered transactions.
(3) 2 CFR 180.330 .. § 1125.332 ........ What method a participant must use to communicate requirements to a lower-tier participant.
(4) 2 CFR 180.425 .. § 1125.425 ........ When a DoD awarding official must check to see if a person is excluded or disqualified.
(5) 2 CFR 180.435 .. § 1125.437 ........ What method a DoD official must use to communicate requirements to a participant.
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(6) 2 CFR 180.930 .. § 1125.930 ........ Which DoD officials are debarring officials.
(7) 2 CFR 180.1010 § 1125.1010 ...... Which DoD officials are suspending officials.
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Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules 32273
(c) Sections of the OMB regulation requirements described in the OMB regulation in 2 CFR part 200 as it relates
that this part does not supplement. For regulation at 2 CFR 180.435? to general terms and conditions of
any section of OMB regulation in § 1125.425 When do I check to see if a
grants and cooperative agreements to
subparts A through I of 2 CFR part 180 person is excluded or disqualified? institutions of higher education,
that is not listed in paragraph (b) of this In addition to the four instances nonprofit organizations, States, local
section, DoD policies and procedures identified in the OMB regulation at 2 governments, and Indian tribes.
are the same as those in the OMB CFR 180.425, you as a DoD Component ■ 180. Revise § 1126.3 to read as
regulation. official must check to see if a person is follows:
177. Revise subparts A through D to excluded or disqualified before you § 1126.3 Exceptions from requirements in
read as follows: obligate additional funding (e.g., this subchapter.
through an incremental funding action)
Subpart A—General for a pre-existing grant or cooperative (a) Exceptions that are not permitted.
agreement with an institution of higher A DoD Component may not grant any
§ 1125.137 Who in the Department of
education, as provided in 32 CFR exception to the requirements in this
Defense may grant an exception to let an
excluded person participate in a covered 22.520(e)(5). subchapter if the exception is:
transaction? (1) Prohibited by statute, Executive
§ 1125.437 What method do I use to
Within the Department of Defense, the communicate to a participant the
order, or regulation;
Secretary of Defense, Secretary of a requirements described in the OMB (2) Inconsistent with the OMB
Military Department, Head of a Defense regulation at 2 CFR 180.435? implementation of the Single Audit Act
Agency, Head of the Office of Economic You as a DoD Component official in subpart F of 2 CFR part 200.
Adjustment, and Head of the Special must include a term or condition in (b) Other exceptions. Other
Operations Command have the each covered transaction into which you exceptions are permitted from
authority to grant an exception to let an enter, to communicate to the participant requirements in this subchapter for
excluded person participate in a the requirements to— institutions of higher education,
covered transaction, as provided in the (a) Comply with subpart C of 2 CFR nonprofit organizations, States, local
OMB regulation at 2 CFR 180.135. part 180, as supplemented by subpart C governments, and Indian tribes as
of this part; and follows:
Subpart B—Covered Transactions (b) Include a similar term or condition
in any lower-tier covered transactions (1) Statutory or regulatory exceptions.
§ 1125.220 What contracts and A DoD Component’s general terms and
subcontracts, in addition to those listed in into which the participant enters.
2 CFR 180.220, are covered transactions?
conditions may incorporate a
PART 1126—SUBCHAPTER D requirement that is inconsistent with
Although the OMB regulation at 2 the requirements in this subchapter if
CFR 180.220(c) allows a Federal agency OVERVIEW
that requirement is specifically
to do so (also see optional lower tier ■ 178. The authority citation for part authorized or required by a statute or
coverage in the figure in appendix A to 1126 continues to read as follows: regulation adopted in the Code of
2 CFR part 180), the Department of Federal Regulations after opportunity
Authority: 5 U.S.C. 301 and 10 U.S.C. 113.
Defense does not extend coverage of for public comment.
nonprocurement suspension and ■ 179. Revise § 1126.1 to read as
debarment requirements beyond first- follows: (2) Individual exceptions. The Head of
tier procurement contracts under a the DoD Component or his or her
§ 1126.1 Purposes of this subchapter. designee may approve an individual
covered nonprocurement transaction.
This subchapter: exception affecting only one award in
Subpart C—Responsibilities of (a) Addresses general terms and accordance with procedures stated in 32
Participants Regarding Transactions conditions governing administrative CFR 21.340.
requirements for use by Department of
§ 1125.332 What method must I use to (3) Small awards. A DoD
Defense (DoD) Components when
pass requirements down to participants at Component’s terms and conditions for
awarding cost-type grants and
lower tiers with whom I intend to do small awards may apply less restrictive
cooperative agreements to institutions of
business? requirements than those specified in
higher education, nonprofit
You as a participant in a covered this subchapter (a small award is an
organizations, States, local governments,
transaction must include a term or award for which the total value of
and Indian tribes. It does so by
condition in any lower-tier covered obligated funding through the life of the
providing:
transaction into which you enter, to (1) A standard organization of the award is not expected to exceed the
require the participant of that administrative requirements into simplified acquisition threshold).
transaction to— articles of general terms and conditions, (4) Other class exceptions. The
(a) Comply with subpart C of 2 CFR each of which is in a specific subject Undersecretary of Defense for Research
part 180; and area. and Engineering has designated the
(b) Include a similar term or condition (2) Standard wording for those Deputy Assistant Secretary of Defense
in any covered transaction into which it articles; and for Science and Technology
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enters at the next lower tier. (3) Associated prescriptions for DoD Foundations with the authority to
Component’s use of the standard approve any class exception affecting
Subpart D—Responsibilities of DoD multiple awards other than small
wording to construct their general terms
Officials Regarding Transactions awards, with OMB concurrence if the
and conditions, which allow for adding,
Sec. omitting, or varying in other ways from class exception is for a requirement that
1125.425 When do I check to see if a person the standard wording in certain is inconsistent with OMB regulation in
is excluded or disqualified? situations. 2 CFR part 200. Procedures for DoD
1125.437 What method do I use to (b) Thereby implements Office of Components’ requests for class
communicate to a participant the Management and Budget (OMB) exceptions are stated in 32 CFR 21.340.
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32274 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
CHAPTER XII—DEPARTMENT OF number. The contracts that are covered PART 1201—UNIFORM
TRANSPORTATION transactions, for example, are specified ADMINISTRATIVE REQUIREMENTS,
by 2 CFR 180.220, as supplemented by COST PRINCIPLES, AND AUDIT
PART 1200—NONPROCUREMENT § 1200.220. For any section of OMB REQUIREMENTS FOR FEDERAL
SUSPENSION AND DEBARMENT regulation in subparts A through I of 2 AWARDS
■ 181. The authority citation for part CFR part 180 that has no corresponding
section in this part, Department of ■ 184. The authority citation for part
1200 continues to read as follows:
Transportation policies and procedures 1201 continues to read as follows:
Authority: 49 U.S.C. 322; Sec. 2455,
Public Law 103–355, 108 Stat. 3327 (31 are those in the OMB regulation. Authority: 49 U.S.C. 322(a); 2 CFR
U.S.C. 6101 note); E.O. 12549 (3 CFR, 1986 ■ 183. Revise subparts B through D to 200.106.
Comp., p. 189); E.O. 12689 (3 CFR, 1989 read as follows:
§ 1201.1 [Redesignated as § 1201.5]
Comp., p. 235).
Subpart B—Covered Transactions ■ 185. Redesignate § 1201.1 as § 1201.5.
■ 182. Revise §§ 1200.10 through
■ 186. Revise newly redesignated
1200.30 to read as follows: § 1200.220 What contracts and § 1201.5 to read as follows:
subcontracts, in addition to those listed in
§ 1200.10 What does this part do? 2 CFR 180.220, are covered transactions? § 1201.5 What does this part do?
This part adopts the Office of In addition to the contracts covered
Management and Budget (OMB) Except as otherwise provided in this
under 2 CFR 180.220(b), this part part, the Department of Transportation
regulation in subparts A through I of 2 applies to any contract, regardless of
CFR part 180, as supplemented by this adopts the Office of Management and
tier, that is awarded by a contractor, Budget (OMB) Uniform Administrative
part, as the Department of subcontractor, supplier, consultant, or
Transportation policies and procedures Requirements, Cost Principles, and
its agent or representative in any Audit Requirements for Federal Awards
for nonprocurement suspension and transaction, if the contract is to be
debarment. This part gives regulatory (2 CFR part 200). This part gives
funded or provided by the Department regulatory effect to the OMB regulation
effect for the Department of of Transportation under a covered
Transportation to the OMB regulation for Federal awards issued by the
nonprocurement transaction and the Department of Transportation (DOT).
for Federal awards issued by the amount of the contract is expected to
Department as supplemented by this See 2 CFR 200.110(a) regarding the
equal or exceed $25,000. This extends process for amending 2 CFR part 200.
part. This part satisfies the requirements the coverage of the Department of
in section 3 of Executive Order 12549, This part superseded and repealed the
Transportation nonprocurement requirements of the Department of
‘‘Suspension and Debarment’’ (3 CFR, suspension and debarment requirements
1986 Comp., p. 189), Executive Order Transportation Common Rules (49 CFR
to all lower tiers of subcontracts under parts 18 and 19), except that grants and
12689, ‘‘Suspension and Debarment’’ (3 covered nonprocurement transactions,
CFR, 1989 Comp., p. 235), and 31 U.S.C. cooperative agreements executed prior
as permitted under the OMB regulation to December 26, 2014, continue to be
6101 note (section 2455, Pub. L. 103– at 2 CFR 180.220(c) (see optional lower-
355, 108 Stat. 3327). subject to 49 CFR parts 18 and 19 as in
tier coverage in the figure in appendix effect on the date of such grants or
§ 1200.20 Does this part apply to me? A to 2 CFR part 180). agreements.
This part and, through this part, ■ 187. Revise § 1201.106 to read as
Subpart C—Responsibilities of follows:
pertinent portions of the OMB
Participants Regarding Transactions
regulation in subparts A through I of 2
§ 1201.106 DOT Component
CFR part 180 (see table 2 to 2 CFR § 1200.332 What methods must I use to implementation.
180.100(b)) apply to you if you are a— pass requirements down to participants at
(a) Participant or principal in a lower tiers with whom I intend to do The specific requirements and
‘‘covered transaction’’ (see subpart B of business? responsibilities for grant-making DOT
2 CFR part 180 and the definition of You as a participant must include a Components are set forth in this part.
‘‘nonprocurement transaction’’ at 2 CFR term or condition in lower-tier DOT Components must implement the
180.970); transactions requiring lower-tier language in this part unless different
(b) Respondent in a Department of participants to comply with subpart C of provisions are required by Federal
Transportation suspension or debarment 2 CFR part 180, as supplemented by this statute or are approved by DOT
action; subpart. Headquarters. DOT Components making
(c) Department of Transportation Federal awards to non-Federal entities
debarment or suspension official; or Subpart D—Responsibilities of Federal must implement the language in
(d) Department of Transportation Agency Officials Regarding subparts C through F of 2 CFR part 200
grants officer, agreements officer, or Transactions in codified regulations unless different
other official authorized to enter into provisions are required by Federal
any type of nonprocurement transaction § 1200.437 What method do I use to statute or are approved by DOT
communicate to a participant the Headquarters.
that is a covered transaction.
requirements described in the OMB
§ 1200.30 What policies and procedures regulation at 2 CFR 180.435? CHAPTER XIII—DEPARTMENT OF
COMMERCE
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must I follow? To communicate to a participant the
The Department of Transportation requirements described in 2 CFR ■ 188. Revise part 1326 to read as
policies and procedures that you must 180.435, you must include a term or follows:
follow are the policies and procedures condition in the transaction that
specified in each applicable section of requires the participant’s compliance PART 1326—NONPROCUREMENT
the OMB regulation in subparts A with subpart C of 2 CFR part 180 and DEBARMENT AND SUSPENSION
through I of 2 CFR part 180, as that requires the participant to include a Sec.
section is supplemented by the section similar term or condition in lower-tier 1326.10 What does this part do?
in this part with the same section covered transactions. 1326.20 Does this part apply to me?
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Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules 32275
1326.30 What policies and procedures must ‘‘nonprocurement transaction’’ at 2 CFR (4) Standard Reference Materials.
I follow? 180.970, as supplemented by subpart B (5) Calibration, Measurement, and
Subpart A—General of this part and § 1326.970); Testing.
1326.137 Who in the Department of (b) Respondent in a Department of (6) Critically Evaluated Data
Commerce may grant an exception to let Commerce suspension or debarment (Standard Reference Data).
an excluded person participate in a action; (7) Phoenix Data System.
covered transaction? (c) Department of Commerce (8) The sale or provision of products,
Subpart B—Covered Transactions
debarment or suspension official; or information, and services to the general
(d) Department of Commerce grants public.
1326.216 Which nonprocurement officer, agreements officer, or other (c) For purposes of the Department of
transactions, in addition to those listed
in 2 CFR 180.215, are not covered
official authorized to enter into any type Commerce, any other transaction if the
transactions? of nonprocurement transaction that is a application of an exclusion to the
1326.220 What contracts and subcontracts, covered transaction. transaction is prohibited by law
in addition to those listed in 2 CFR includes:
§ 1326.30 What policies and procedures
180.220, are covered transactions? (1) The Administration of the Anti-
must I follow?
Subpart C—Responsibilities of Participants dumping and Countervailing Duty
The Department of Commerce policies Statutes.
Regarding Transactions
and procedures that you must follow are (2) The export Trading Company Act
1326.332 What methods must I use to pass the policies and procedures specified in
requirements down to participants at Certification of Review Program.
each applicable section of the OMB (3) Trade Adjustment Assistance
lower tiers with whom I intend to do
business?
regulation in subparts A through I of 2 Program Certification.
CFR part 180, as that section is (4) Foreign Trade Zones Act of 1934,
Subpart D—Responsibilities of Federal supplemented by the section in this part
Agency Officials Regarding Transactions as amended.
with the same section number. The (5) Statutory Import Program.
1326.437 What method do I use to contracts that are covered transactions,
communicate to a participant the for example, are specified by 2 CFR § 1326.220 What contracts and
requirements described in the OMB 180.220 as supplemented by § 1326.220. subcontracts, in addition to those listed in
regulation at 2 CFR 180.435? 2 CFR 180.220, are covered transactions?
For any section of OMB regulation in
Subparts E–H [Reserved] subparts A through I of 2 CFR part 180 In addition to the contracts covered
Subpart I—Definitions that has no corresponding section in under 2 CFR 180.220(b), this part
this part, Department of Commerce applies to a subcontract that is awarded
1326.970 Nonprocurement transaction. by a participant in a procurement
policies and procedures are those in the
Subpart J [Reserved] OMB regulation. transaction covered under 2 CFR
180.220(a), if the amount of the
Authority: 5 U.S.C. 301; sec. 2455, Pub. L. Subpart A—General subcontract exceeds or is expected to
103–355, 108 Stat. 3327 (31 U.S.C. 6101
note); E.O. 12549, 51 FR 6370, 3 CFR, 1986
exceed $25,000. This extends the
§ 1326.137 Who in the Department of
Comp., p. 189; E.O. 12689, 54 FR 34131, 3 Commerce may grant an exception to let an coverage of the Department of
CFR, 1989 Comp., p. 235. excluded person participate in a covered Commerce nonprocurement suspension
transaction? and debarment requirements to one
§ 1326.10 What does this part do? additional tier of contracts under
Within the Department of Commerce,
This part adopts the Office of the Secretary of Commerce or designee covered nonprocurement transactions,
Management and Budget (OMB) has the authority to grant an exception as permitted under the OMB regulation
regulation in subparts A through I of 2 to let an excluded person participate in at 2 CFR 180.220(c) (see optional lower
CFR part 180, as supplemented by this a covered transaction, as provided in the tier coverage in the figure in appendix
part, as the Department of Commerce OMB regulation at 2 CFR 180.135. A to 2 CFR part 180).
policies and procedures for
nonprocurement debarment and Subpart B—Covered Transactions Subpart C—Responsibilities of
suspension. This part gives regulatory Participants Regarding Transactions
effect to the OMB regulation for Federal § 1326.216 Which nonprocurement
transactions, in addition to those listed in § 1326.332 What methods must I use to
awards issued by the Department of pass requirements down to participants at
2 CFR 180.215, are not covered
Commerce, as supplemented by this lower tiers with whom I intend to do
transactions?
part. This part satisfies the requirements business?
in section 3 of Executive Order 12549, (a) For purposes of the Department of
Commerce, a transaction that the You as a participant must include a
‘‘Debarment and Suspension’’ (3 CFR, term or condition in lower-tier
1986 Comp., p. 189), Executive Order Department needs to respond to a
national or agency-recognized transactions requiring lower-tier
12689, ‘‘Debarment and Suspension’’ (3 participants to comply with subpart C of
CFR, 1989 Comp., p. 235), and 31 U.S.C. emergency or disaster includes the
Fisherman’s Contingency Fund. 2 CFR part 180, as supplemented by this
6101 note (section 2455, Pub. L. 103– subpart.
355, 108 Stat. 3327). (b) For purposes of the Department of
Commerce, an incidental benefit that
Subpart D—Responsibilities of Federal
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§ 1326.20 Does this part apply to me? results from ordinary governmental
Agency Officials Regarding
This part and, through this part, operations includes:
Transactions
pertinent portions of the OMB (1) Export Promotion, Trade
regulation in subparts A through I of 2 Information and Counseling, and Trade § 1326.437 What method do I use to
CFR part 180 (see table 2 to 2 CFR policy. communicate to a participant the
180.100(b)) apply to you if you are a— (2) Geodetic Surveys and Services requirements described in the OMB
(a) Participant or principal in a (Specialized Services). regulation at 2 CFR 180.435?
‘‘covered transaction’’ (see subpart B of (3) Fishery Products Inspection To communicate to a participant the
2 CFR part 180 and the definition of Certification. requirements described in 2 CFR
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32276 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
180.435, you must include a term or Authority: 5 U.S.C. 301; 38 U.S.C. 501; 2 Commerce’s grants and cooperative
condition in the transaction that CFR part 200. agreements; and
requires the participant’s compliance § 1327.10 Adoption of 2 CFR part 200.
(b) Establishes Department of
with subpart C of 2 CFR part 180, as Commerce policies and procedures for
supplemented by subpart C of this part, The Department of Commerce adopts compliance with the Act that are the
and requires the participant to include the Office of Management and Budget same as those of other Federal agencies,
a similar term or condition in lower-tier (OMB) regulation in 2 CFR part 200. in conformance with the requirement in
covered transactions. This part gives regulatory effect to the 41 U.S.C. 705 for Governmentwide
OMB regulation for Federal awards implementing regulations.
Subparts E–H [Reserved] issued by the Department of Commerce.
See 2 CFR 200.110(a) regarding the 1329.20 Does this part apply to me?
Subpart I—Definitions process for amending 2 CFR part 200. This part and, through this part,
pertinent portions of the OMB
§ 1326.970 Nonprocurement transaction. § 1327.11 [Reserved]
regulation in subparts A through F of 2
For purposes of the Department of CFR part 182 (see 2 CFR 182.115(b))
PART 1329—REQUIREMENTS FOR
Commerce, nonprocurement transaction apply to you if you are a—
DRUG–FREE WORKPLACE
includes the following: (a) Recipient of a Department of
(FINANCIAL ASSISTANCE)
(a) Joint project Agreements under 15 Commerce grant or cooperative
U.S.C. 1525. ■ 190. The authority citation for part agreement; or
(b) Cooperative research and 1329 continues to read as follows: (b) Department of Commerce
development agreements. Authority: 5 U.S.C. 301; 41 U.S.C. 701– awarding official.
(c) Joint statistical agreements. 707. 1329.30 What policies and procedures
(d) Patent licenses under 35 U.S.C.
■ 191. Revise §§ 1329.10 through must I follow?
207.
(e) NTIS joint ventures, 15 U.S.C. 1329.30 to read as follows: (a) General. You must follow the
3704b. policies and procedures specified in
1329.10 What does this part do? applicable sections of the OMB
Subpart J [Reserved] This part requires that the award and regulation in subparts A through F of 2
administration of Department of CFR part 182, as implemented by this
■ 189. Revise part 1327 to read as Commerce grants and cooperative part.
follows: agreements comply with Office of (b) Specific sections of OMB
Management and Budget (OMB) regulation that this part supplements. In
PART 1327—UNIFORM regulation implementing the portion of implementing the OMB regulation in 2
ADMINISTRATIVE REQUIREMENTS, the Drug-Free Workplace Act of 1988 CFR part 182, this part supplements
COST PRINCIPLES, AND AUDIT (41 U.S.C. 701–707, as amended, four sections of the OMB regulation, as
REQUIREMENTS FOR FEDERAL hereinafter referred to as ‘‘the Act’’) that shown in the following table. For each
AWARDS applies to grants. This part— of those sections, you must follow the
Sec. (a) Gives regulatory effect to the OMB policies and procedures in the OMB
1327.10 Adoption of 2 CFR part 200. regulation (subparts A through F of 2 regulation, as supplemented by this
1327.11 [Reserved] CFR part 182) for the Department of part.
Section in this
Section of OMB part where What the supplementation clarifies
regulation supplemented
(1) 2 CFR § 1329.225 ........ Whom in the Department of Commerce a recipient other than an individual must notify if an employee
182.225(a). is convicted for a violation of a criminal drug statute in the workplace.
(2) 2 CFR § 1329.300 ........ Whom in the Department of Commerce a recipient who is an individual must notify if he or she is con-
182.300(b). victed of a criminal drug offense resulting from a violation occurring during the conduct of any award
activity.
(3) 2 CFR 182.500 .. § 1329.500 ........ Who in the Department of Commerce is authorized to determine that a recipient other than an indi-
vidual is in violation of the requirements of 2 CFR part 182, as implemented by this part.
(4) 2 CFR 182.505 .. § 1329.505 ........ Who in the Department of Commerce is authorized to determine that a recipient who is an individual is
in violation of the requirements of 2 CFR part 182, as implemented by this part.
(c) Sections of the OMB regulation 1329.400 What method do I use as an adopts the Governmentwide
that this part does not supplement. For agency awarding official to obtain a implementation (2 CFR part 182) of sec.
any section of OMB regulation in recipient’s agreement to comply with the 5152–5158 of the Drug-Free Workplace
OMB regulation?
subparts A through F of 2 CFR part 182 Act of 1988 (Pub. L. 100–690, Title V,
that is not listed in paragraph (b) of this To obtain a recipient’s agreement to Subtitle D; 41 U.S.C. 701–707).
khammond on DSK9W7S144PROD with PROPOSALS2
section, Department of Commerce comply with applicable requirements in
the OMB regulation at 2 CFR part 182, CHAPTER XIV—DEPARTMENT OF THE
policies and procedures are the same as INTERIOR
those in the OMB regulation. you must include the following term or
condition in the award:
■ 192. Revise § 1329.400 to read as PART 1400—NONPROCUREMENT
Drug-free workplace. You as the
follows: DEBARMENT AND SUSPENSION
recipient must comply with drug-free
workplace requirements in subpart B (or ■ 193. The authority citation for part
subpart C, if the recipient is an
1400 continues to read as follows:
individual) of 2 CFR part 1329, which
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Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules 32277
Authority: Section 2455, Pub. L. 103–355, 1400.137 Who in the Department of the a similar term or condition in lower-tier
108 Stat. 3327 (31 U.S.C. 6101 note); 5 U.S.C. Interior may grant an exception to let an covered transactions.
301; E.O. 12549 (3 CFR, 1986 Comp., p. 189); excluded person participate in a covered
and E.O. 12689 (3 CFR, 1989 Comp., p. 235). transaction? PART 1401—REQUIREMENTS FOR
■ 194. Revise §§ 1400.20 and 1400.30 to Within the Department of the Interior, DRUG–FREE WORKPLACE
read as follows: the Director, Office of Acquisition and (FINANCIAL ASSISTANCE)
Property Management has the authority
1400.20 When does this part apply to me? to grant an exception to let an excluded ■ 199. The authority citation for part
This part and, through this part, person participate in a covered 1401 continues to read as follows:
pertinent portions of the OMB transaction, as provided in the OMB Authority: 5 U.S.C. 301; 31 U.S.C. 6101
regulation in subparts A through I of 2 regulation at 2 CFR 180.135. note, 7501; 41 U.S.C. 252a; 41 U.S.C. 701–
CFR part 180 (see table 2 to 2 CFR ■ 196. Revise § 1400.220 to read as 707.
180.100(b)) apply to you if you are— follows:
(a) Participant or principal in a ■ 200. Revise §§ 1401.100 through
‘‘covered transaction’’ (see subpart B of 1400.220 What contracts and 1401.110 to read as follows:
2 CFR part 180 and the definition of subcontracts, in addition to those listed in
2 CFR 180.220, are covered transactions? 1401.100 What does this part do?
‘‘nonprocurement transaction’’ at 2 CFR
180.970, as supplemented by subpart B Although the OMB regulation at 2 This part requires that the award and
of this part and § 1400.970); CFR 180.220(c) allows a Federal agency administration of the Department of the
(b) Respondent in a Department of the to do so (also see optional lower tier Interior (DOI) grants and cooperative
Interior suspension or debarment action; coverage in the figure in appendix A to agreements comply with Office of
(c) Department of the Interior 2 CFR part 180), the Department of the Management and Budget (OMB)
debarment or suspension official, i.e., Interior does not extend coverage of regulation implementing the portion of
the Director, Office of Acquisition and nonprocurement suspension and the Drug-Free Workplace Act of 1988,
Property Management; or debarment requirements beyond first- 41 U.S.C. 701–707, as amended
(d) Department of the Interior grants tier procurement contracts under a (hereinafter, ‘‘the Act’’) that applies to
officer, agreements officer, or other covered nonprocurement transaction. grants. This part—
official authorized to enter into any type ■ 197. Revise § 1400.332 read as (a) Gives regulatory effect to the OMB
of nonprocurement transaction that is a follows: regulation (subparts A through F of 2
covered transaction. CFR part 182) for DOI’s grants and
1400.332 What methods must I use to
1400.30 What policies and procedures pass requirements down to participants at cooperative agreements; and
must I follow? lower tiers with whom I intend to do (b) Establishes DOI policies and
(a) The Department of the Interior business? procedures for compliance with the Act
policies and procedures that you must You as a participant must include a that are the same as those of other
follow are specified in: term or condition in lower-tier Federal agencies, in conformance with
(1) Each applicable section of the transactions requiring lower-tier the requirement in 41 U.S.C. 705 for
OMB regulation in subparts A through participants to comply with subpart C of Government-wide implementing
I of 2 CFR part 180; and 2 CFR part 180. regulations.
(2) The supplement to each section of ■ 198. Revise § 1400.437 to read as
the OMB regulation that is found in this 1401.105 Does this part apply to me?
follows:
part under the same section number. (a) This part and, through this part,
(The contracts that are covered 1400.437 What method do I use to pertinent portions of the OMB
transactions, for example, are specified communicate to a participant the
regulation in subparts A through F of 2
by 2 CFR 180.220 as supplemented by requirements described in the OMB
regulation at 2 CFR 180.435? CFR part 182 apply if you are—
§ 1400.220.)
To communicate to a participant the (1) A recipient of an assistance award
(b) For any section of OMB regulation
requirements described in 2 CFR from the Department of the Interior; or
in subparts A through I of 2 CFR part
180 that has no corresponding section in 180.435, you must include a term or (2) The Department of the Interior
this part, Department of the Interior condition in the transaction that awarding official.
policies and procedures are those in the requires the participant’s compliance (b) Paragraphs (b)(1) through (3) of
OMB regulation. with subpart C of 2 CFR part 180, as this section show the subparts that
■ 195. Revise § 1400.137 to read as supplemented by subpart C of this part, apply to you (in lieu of 2 CFR
follows: and requires the participant to include 182.115(b)):
If you are . . . See subparts
(1) A recipient who is not an individual ......................................................................................................................... A, C, and F.
(2) A recipient who is an individual ............................................................................................................................... A, D, and F.
(3) A Department of the Interior awarding official ......................................................................................................... A, E, and F.
khammond on DSK9W7S144PROD with PROPOSALS2
1401.110 What policies and procedures CFR part 182, as implemented by this sections of the OMB regulation, as
must I follow? part. shown in the following table. For each
(a) General. You must follow the (b) Specific sections of OMB of those sections, you must follow the
policies and procedures specified in regulation that this part supplements. In policies and procedures set forth in the
applicable sections of the OMB implementing OMB regulation in 2 CFR OMB regulation, as supplemented by
regulation in subparts A through F of 2 part 182, this part supplements four this part.
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32278 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
Section in this
Section of OMB part where What the supplementation clarifies
regulation supplemented
(1) 2 CFR § 1401.335 ........ Whom in the DOI a recipient other than an individual must notify if an employee is convicted for a vio-
182.225(a). lation of a criminal drug statute in the workplace.
(2) 2 CFR § 1401.401 ........ Whom in the DOI a recipient who is an individual must notify if he or she is convicted of a criminal
182.300(b). drug offense resulting from a violation occurring during the conduct of any award activity.
(3) 2 CFR 182.500 .. § 1401.600 ........ Who in the DOI is authorized to determine that a recipient other than an individual is in violation of the
requirements of 2 CFR part 182, as implemented by this part.
(4) 2 CFR 182.505 .. § 1401.605 ........ Who in the DOI is authorized to determine that a recipient who is an individual is in violation of the re-
quirements of 2 CFR part 182, as implemented by this part.
(c) Sections of the OMB regulation part 200 and gives regulatory effect to under Environmental Protection Agency
that this part does not supplement. For the OMB regulation for Federal awards (EPA) assistance agreements include:
any section of OMB regulation in issued by the Department of the Interior. (1) Rebates or other subsidies
subparts A through F of 2 CFR part 182 The regulation applies in full except as provided to program participants for
that is not listed in paragraph (b) of this stated in this part. See 2 CFR 200.110(a) purchases and installations of
section, DOI policies and procedures are regarding the process for amending 2 commercially available, standard (‘‘off
the same as those in the OMB CFR part 200. the shelf’’) pollution control equipment
regulation. (b) This part establishes DOI financial or low emission vehicles under the
■ 201. Revise § 1401.500 to read as assistance regulations that implement or Diesel Emission Reduction Act program
follows: supplement the OMB regulation in 2 or programs authorized by EPA
§ 1401.500 What are my responsibilities as
CFR part 200. It is designed to ensure appropriation acts and permitted by
a DOI awarding official? that financial assistance is administered terms specified in EPA assistance
in full compliance with applicable law, agreements or regulation, when the
To obtain a recipient’s agreement to
regulation, policy, and best practices to program participant rather than the
comply with applicable requirements in
ensure the American people get the recipient owns the equipment.
the OMB regulation at 2 CFR part 182,
most value from the funds DOI awards (2) Subsidies, rebates, and other
you must include the following term or
on financial assistance. For payments provided to program
condition in the award:
Drug-free workplace. You, as the supplemental regulation, DOI has beneficiaries to encourage participation
recipient, must comply with drug-free adopted section numbering that in statutorily authorized programs to
workplace requirements in subpart B (or corresponds to related OMB regulation encourage environmental stewardship
subpart C, if the recipient is an in 2 CFR part 200. and enable the public to participate in
individual) of part 1401, which adopts (c) This part extends 2 CFR part 200, EPA funded research, pollution
the government-wide implementation of subparts A through E, policies and abatement, and other projects or
2 CFR part 182; sections 5152–5158 of procedures to foreign public entities and programs to the extent permitted by
the Drug-Free Workplace Act of 1988, foreign organizations as allowed by 2 statutes and terms specified in EPA
Public Law 100–690, Title V, Subtitle D; CFR 200.101, except as indicated assistance agreements or guidance.
41 U.S.C. 701–707. throughout this part.
■ 206. Revise § 1500.2 to read as
CHAPTER XV—ENVIRONMENTAL follows:
PART 1402—FINANCIAL ASSISTANCE PROTECTION AGENCY
INTERIOR REGULATION, § 1500.2 Adoption of 2 CFR part 200.
SUPPLEMENTING THE UNIFORM PART 1500—UNIFORM
Under the authority listed in the
ADMINISTRATIVE REQUIREMENTS, ADMINISTRATIVE REQUIREMENTS,
authority citation for this part, the
COST PRINCIPLES, AND AUDIT COST PRINCIPLES, AND AUDIT
Environmental Protection Agency
REQUIREMENTS FOR FEDERAL REQUIREMENTS FOR FEDERAL
adopts the Office of Management and
AWARDS AWARDS
Budget (OMB) regulation ‘‘Uniform
■ 202. The authority citation for part ■ 204. The authority citation for part Administrative Requirements, Cost
1402 continues to read as follows: 1500 continues to read as follows: Principles, and Audit Requirements for
Authority: 5 U.S.C. 301 and 2 CFR part Federal Awards to Non-Federal
Authority: 5 U.S.C. 301, 7 U.S.C. 136 et
200. seq., 15 U.S.C. 2601 et seq., 20 U.S.C. 4011 Entities’’ (subparts A through F of 2 CFR
et seq., 33 U.S.C. 1251 et seq., and 1401 et part 200), as supplemented by this part,
■ 203. Revise § 1402.100 to read as
seq., 42 U.S.C. 241, 242b, 243, 246, 300f et as the Environmental Protection Agency
follows:
seq., 1857 et seq., 6901 et seq., 7401 et seq., (EPA) policies and procedures for
§ 1402.100 Purpose. and 9601 et seq.; 2 CFR part 200. financial assistance administration. This
(a) The Uniform Administrative part satisfies the requirements of 2 CFR
■ 205. Revise subpart A to read as
Requirements, Cost Principles, and 200.110(a) and gives regulatory effect to
follows:
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Audit Requirements for Federal Awards the OMB regulation for Federal awards
set forth in 2 CFR part 200 apply to the Subpart A—Acronyms and Definitions issued by EPA, as supplemented by this
Department of the Interior. This part part. EPA also has programmatic
adopts, as the Department of the Interior § 1500.1 Definitions. regulations located in 40 CFR chapter I,
(DOI) policies and procedures, the In addition to the definitions in 2 CFR subchapter B. See 2 CFR 200.110(a)
Office of Management and Budget’s 200.1, the following terms apply to this regarding the process for amending 2
(OMB) Uniform Administrative part: CFR part 200.
Requirements, Cost Principles, and Participant support costs, to provide ■ 207. Revise § 1500.4 to read as
Audit Requirements set forth in 2 CFR that allowable participant support costs follows:
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Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules 32279
§ 1500.4 Exceptions. enter into any type of nonprocurement Subpart C—Responsibilities of
Consistent with 2 CFR 200.102(c): transaction that is a covered transaction. Participants Regarding Transactions
(a) In the EPA, the Director, Office of
§ 1532.30 What policies and procedures § 1532.332 What methods must I use to
the Chief Grants Officer or designee, is
must I follow? pass requirements down to participants at
authorized to grant exceptions on a lower tiers with whom I intend to do
case-by-case basis for recipients. The EPA policies and procedures that business?
(b) The EPA Director or designee is you must follow are the policies and You as a participant must include a
also authorized to approve exceptions, procedures specified in each applicable term or condition in lower-tier
on a class or an individual case basis, section of the OMB regulation in transactions requiring lower-tier
to EPA program specific assistance subparts A through I of 2 CFR part 180, participants to comply with subpart C of
regulations other than those which as that section is supplemented by the 2 CFR part 180, as supplemented by this
implement statutory and Executive section in this part with the same subpart.
order requirements. section number. The contracts that are
covered transactions, for example, are Subpart D—Responsibilities of Federal
Subpart C—[Removed and Reserved] Agency Officials Regarding
specified by 2 CFR 180.220 as
■ 208. Remove and reserve subpart C, supplemented by § 1532.220. For any Transactions
consisting of § 1500.6. section of OMB regulation in subparts A § 1532.437 What method do I use to
through I of 2 CFR part 180 that has no communicate to a participant the
PART 1532—NONPROCUREMENT corresponding section in this part, EPA requirements described in the OMB
DEBARMENT AND SUSPENSION regulation at 2 CFR 180.435?
policies and procedures are those in the
■ 209. The authority citation for part OMB regulation. To communicate to a participant the
1532 continues to read as follows: requirements described in 2 CFR
■ 211. Revise subparts A through D to
180.435, you must include a term or
Authority: 33 U.S.C. 1251 et seq.; 42 read as follows: condition in the transaction that
U.S.C. 7401 et seq.; Sec. 2455, Pub. L. 103–
355, 108 Stat. 3327 (31 U.S.C. 6101 note);
requires the participant’s compliance
Subpart A—General
E.O. 11738 (3 CFR, 1973 Comp., p. 799); E.O. with subpart C of 2 CFR part 180, as
12549 (3 CFR, 1986 Comp., p. 189); E.O. § 1532.137 Who in the EPA may grant an supplemented by subpart C of this part,
12689 (3 CFR, 1989 Comp., p. 235). exception to let an excluded person and requires the participant to include
■ 210. Revise §§ 1532.10 through participate in a covered transaction? a similar term or condition in lower-tier
1532.30 to read as follows: covered transactions.
The EPA debarring official has the ■ 212. Revise § 1532.1125 to read as
§ 1532.10 What does this part do? authority to grant an exception to let an follows:
This part adopts the Office of excluded person participate in a
covered transaction, as provided in the § 1532.1125 How do award officials and
Management and Budget (OMB) others know if I am disqualified?
regulation in subparts A through I of 2 OMB regulation at 2 CFR 180.135. If the
EPA debarring official grants an If you are convicted under the statutes
CFR part 180, as supplemented by this
exception, the exception must be in in §§ 1532.1100 and 1532.1105, the EPA
part, as the Environmental Protection
enters your name and address and that
Agency (EPA) policies and procedures writing and state the reason(s) for
of the violating facility into the System
for nonprocurement debarment and deviating from the Governmentwide
for Award Management (SAM.gov)
suspension. This part gives regulatory policy in Executive Order 12549. Exclusions as soon as possible after the
effect for the EPA to the OMB regulation
EPA learns of your conviction. In
as supplemented by this part. This part Subpart B—Covered Transactions
addition, the EPA enters other
satisfies the requirements in section 3 of
§ 1532.220 What contracts and information describing the nature of
Executive Order 12549, ‘‘Debarment and
subcontracts, in addition to those listed in your disqualification. Federal award
Suspension’’ (3 CFR, 1986 Comp., p.
2 CFR 180.220, are covered transactions? officials and others who administer
189), Executive Order 12689,
Federal programs consult SAM.gov
‘‘Debarment and Suspension’’ (3 CFR, In addition to the contracts covered
Exclusions before entering into or
1989 Comp., p. 235), and 31 U.S.C. 6101 under 2 CFR 180.220(b), this part approving procurement and
note (section 2455, Pub. L. 103–355, 108 applies to any contract, regardless of nonprocurement transactions. Anyone
Stat. 3327). tier, that is awarded by a contractor, may access SAM.gov Exclusions through
§ 1532.20 Does this part apply to me?
subcontractor, supplier, consultant, or the internet, currently at https://
its agent or representative in any www.sam.gov.
This part and, through this part, transaction, if the contract is to be ■ 213. In § 1532.1130, revise paragraph
pertinent portions of the OMB
funded or provided by the EPA under a (a) to read as follows:
regulation in subparts A through I of 2
covered nonprocurement transaction
CFR part 180 (see table 2 to 2 CFR § 1532.1130 How does disqualification
180.100(b)) apply to you if you are a— and the amount of the contract is
under the CAA or CWA differ from a Federal
(a) Participant or principal in a expected to equal or exceed $25,000. discretionary suspension or debarment
‘‘covered transaction’’ (see subpart B of This extends the coverage of the EPA action?
khammond on DSK9W7S144PROD with PROPOSALS2
2 CFR part 180 and the definition of nonprocurement suspension and (a) CAA and CWA disqualifications
‘‘nonprocurement transaction’’ at 2 CFR debarment requirements to all lower are exclusions mandated by statute. In
180.970); tiers of subcontracts under covered contrast, suspensions and debarments
(b) Respondent in an EPA suspension nonprocurement transactions, as imposed under subparts A through I of
or debarment action; permitted under the OMB regulation at 2 CFR part 180 or under 48 CFR part 9,
(c) EPA debarment or suspension 2 CFR 180.220(c) (see optional lower subpart 9.4, are exclusions imposed at
official; or tier coverage in the figure in appendix the discretion of Federal suspending or
(d) EPA grants officer, agreements A to 2 CFR part 180). debarring officials. This means that if
officer, or other official authorized to you are convicted of violating the CAA
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32280 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
or CWA provisions described under § 1532.1500 If I am reinstated, when will (b) Establishes Environmental
§ 1532.1105, ordinarily your name and my name be removed from SAM.gov Protection Agency policies and
that of the violating facility is placed Exclusions? procedures for compliance with the Act
into SAM.gov Exclusions before you If your eligibility for procurement and that are the same as those of other
receive a confirmation notice of the nonprocurement participation is Federal agencies, in conformance with
listing, or have the opportunity to restored under the CAA or CWA, the requirement in 41 U.S.C. 705 for
discuss the disqualification with, or whether by decision, appeal, or by Governmentwide implementing
seek reinstatement from, the EPA. administrative agreement, the EPA will regulations.
remove your name and that of the
* * * * * violating facility from SAM.gov § 1536.20 Does this part apply to me?
■ 214. Revise § 1532.1200 to read as Exclusions, generally within 5 working This part and, through this part,
follows: days of your reinstatement. pertinent portions of the OMB
regulation in subparts A through F of 2
§ 1532.1200 How will I know if I am PART 1536—REQUIREMENTS FOR CFR part 182 (see 2 CFR 182.115(b))
disqualified under the CAA or CWA? DRUG-FREE WORKPLACE apply to you if you are a—
There may be several ways that you (FINANCIAL ASSISTANCE) (a) Recipient of an Environmental
learn about your disqualification. You ■ 216. The authority citation for part
Protection Agency grant or cooperative
are legally on notice by the CAA at 42 1536 continues to read as follows: agreement; or
U.S.C. 4606 and CWA at 33 U.S.C. 1368 (b) Environmental Protection Agency
Authority: 41 U.S.C. 701–707. awarding official.
that a criminal conviction of any offense
■ 217. Revise §§ 1536.10 through
listed under 42 U.S.C. 7413(c) of the § 1536.30 What policies and procedures
CAA or 33 U.S.C. 1319(c) of the CWA 1536.30 to read as follows:
must I follow?
automatically disqualifies you. As a § 1536.10 What does this part do? (a) General. You must follow the
practical matter, you may learn about This part requires that the award and policies and procedures specified in
your disqualification from your defense administration of Environmental applicable sections of the OMB
counsel, a Federal contract or award Protection Agency grants and regulation in subparts A through F of 2
official, or from someone else who sees cooperative agreements comply with CFR part 182, as implemented by this
your name on SAM.gov Exclusions. As Office of Management and Budget part.
a courtesy, the EPA will attempt to (OMB) regulation implementing the (b) Specific sections of OMB
notify you that your name has been portion of the Drug-Free Workplace Act regulation that this part supplements. In
entered into SAM.gov Exclusions. The of 1988 (41 U.S.C. 701–707, as implementing the OMB regulation in 2
EPA will inform you of the procedures amended, hereinafter referred to as ‘‘the CFR part 182, this part supplements
for seeking reinstatement and give you Act’’) that applies to grants. This part— four sections of the OMB regulation, as
the name of a person you can contact to (a) Gives regulatory effect to the OMB shown in the following table. For each
discuss your reinstatement request. regulation (subparts A through F of 2 of those sections, you must follow the
CFR part 182) for the Environmental policies and procedures in the OMB
■ 215. Revise § 1532.1500 to read as
Protection Agency’s grants and regulation, as supplemented by this
follows: cooperative agreements; and part.
Section in this
Section of OMB What the supplementation
part where
regulation clarifies
supplemented
(1) 2 CFR § 1536.225 ........ Whom in the Environmental Protection Agency a recipient other than an individual must notify if an
182.225(a). employee is convicted for a violation of a criminal drug statute in the workplace.
(2) 2 CFR § 1536.300 ........ Whom in the Environmental Protection Agency a recipient who is an individual must notify if he or she
182.300(b). is convicted of a criminal drug offense resulting from a violation occurring during the conduct of any
award activity.
(3) 2 CFR 182.500 .. § 1536.500 ........ Who in the Environmental Protection Agency is authorized to determine that a recipient other than an
individual is in violation of the requirements of 2 CFR part 182, as implemented by this part.
(4) 2 CFR 182.505 .. § 1536.505 ........ Who in the Environmental Protection Agency is authorized to determine that a recipient who is an indi-
vidual is in violation of the requirements of 2 CFR part 182, as implemented by this part.
(c) Sections of the OMB regulation § 1536.400 What method do I use as an Governmentwide implementation (2
that this part does not supplement. For agency awarding official to obtain a CFR part 182) of sec. 5152–5158 of the
any section of OMB regulation in recipient’s agreement to comply with the Drug-Free Workplace Act of 1988 (Pub.
OMB regulation? L. 100–690, Title V, Subtitle D; 41
subparts A through F of 2 CFR part 182
that is not listed in paragraph (b) of this To obtain a recipient’s agreement to U.S.C. 701–707).
section, Environmental Protection comply with applicable requirements in
CHAPTER XVI—US INTERNATIONAL
khammond on DSK9W7S144PROD with PROPOSALS2
Agency policies and procedures are the the OMB regulation at 2 CFR part 182,
DEVELOPMENT FINANCE CORPORATION
same as those in the OMB regulation. you must include the following term or
condition in the award: PART 1600—NONPROCUREMENT
■ 218. Revise § 1536.400 to read as Drug-free workplace. You as the DEBARMENT AND SUSPENSION
follows: recipient must comply with drug-free
workplace requirements in subpart B (or ■ 219. The authority citation for part
subpart C, if the recipient is an 1600 continues to read as follows:
individual) of 2 CFR Subtitle B, Chapter Authority: Sec. 2455, Pub. L. 103–355, 108
XV, Part 1536, which adopts the Stat. 3327 (31 U.S.C. 6101 note); E.O. 12549,
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Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules 32281
51 FR 6370, 3 CFR, 1986 Comp., p. 189; E.O. nonprocurement transaction are covered applicable appendices of 2 CFR part
12689, 54 FR 34131, 3 CFR, 1989 Comp., p. transactions. Although the OMB 200, as supplemented by this part, as
235. regulation at 2 CFR 180.220(c) allows a the NASA policies and procedures for
■ 220. Revise §§ 1600.10 through Federal agency to do so (see also uniform administrative requirements,
1600.30 to read as follows: optional lower tier coverage in the cost principles, and audit requirements
figure in appendix A to 2 CFR part 180), for Federal awards. This part gives
§ 1600.10 What does this part do?
DFC does not extend coverage of regulatory effect to the OMB regulation
This part adopts the Office of nonprocurement suspension and for Federal awards issued by NASA as
Management and Budget (OMB) debarment requirements beyond first- supplemented by this part. See 2 CFR
regulation in subparts A through I of 2 tier procurement under a covered 200.110(a) regarding the process for
CFR part 180, as supplemented by this nonprocurement transaction. Moreover, amending 2 CFR part 200.
part, as the U.S. International for purposes of determining whether a
Development Finance Corporation procurement contract is included as a § 1800.101 Applicability.
(DFC) regulations for non-procurement covered transaction, the threshold in 2 (a) This part establishes policies and
debarment and suspension. This part CFR 180.220(b) is increased from procedures for grants and cooperative
gives regulatory effect for DFC to the $25,000 to the ‘‘simplified acquisition agreements awarded by NASA to non-
OMB regulation as supplemented by threshold’’ as defined in 48 CFR 2.101. Federal entities, for-profit organization,
this part. This part satisfies the ■ 222. Revise § 1600.332 to read as foreign organizations, and foreign public
requirements in section 3 of Executive follows: entities as allowed by 2 CFR 200.101.
Order 12549, ‘‘Debarment and For supplemental regulation, NASA has
Suspension’’ (3 CFR, 1986 Comp., p. § 1600.332 What requirements must I pass adopted section numbers that
189); Executive Order 12689, down to persons at lower tiers with whom correspond to those in the OMB
‘‘Debarment and Suspension’’ (3 CFR, I intend to do business? regulation in 2 CFR part 200.
1989 Comp., p. 235); and section 2455 You, as a participant, must include a (1) Non-Federal entities must follow
of the Federal Acquisition Streamlining term or condition in lower-tier the policies and procedures appearing
Act of 1994, Public Law 103–355 (31 transactions that are covered in subparts A through F and applicable
U.S.C. 6101 note). transactions, requiring lower-tier appendices of 2 CFR part 200 and as
participants to comply with the OMB supplemented by this part.
§ 1600.20 Does this part apply to me? regulation in 2 CFR part 180, subpart C, (2) Foreign organizations and foreign
This part and, through this part, as supplemented by this subpart. public entities must follow the policies
pertinent portions of the OMB and procedures appearing in subparts A
CHAPTER XVIII—NATIONAL
regulation in subparts A through I of 2 AERONAUTICS AND SPACE through E and applicable appendices of
CFR part 180 (see table 2 to 2 CFR ADMINISTRATION 2 CFR part 200 and as supplemented by
180.100(b)) apply to you if you are a— this part.
(a) Participant or principal in a PART 1800—UNIFORM (3) U.S. and foreign for-profit
‘‘covered transaction’’ (see 2 CFR part ADMINISTRATIVE REQUIREMENTS, organizations must follow the policies
180, subpart B, and the definition of COST PRINCIPLES, AND AUDIT and procedures appearing in subparts A
‘‘non-procurement transaction’’ at 2 CFR REQUIREMENTS FOR FEDERAL through D and applicable appendices of
180.970); AWARDS 2 CFR part 200 and as supplemented by
(b) Respondent in a DFC suspension this part. The Federal Acquisition
or debarment action; ■ 223. The authority citation for part
Regulation (FAR) at 48 CFR parts 30 and
(c) DFC suspending or debarring 1800 continues to read as follows:
31, takes precedence over the cost
official; and Authority: 51 U.S.C. 20113 (e), Pub. L. 97– principles in 2 CFR part 200, subpart E,
(d) DFC investment, guarantee, 258, 96 Stat. 1003 (31 U.S.C. 6301 et seq.), for Federal awards to U.S. and foreign
insurance or grant official authorized to and 2 CFR part 200.
for-profit organizations.
enter into any type of non-procurement (b) Throughout this part, the term
transaction that is a covered transaction. Subparts B and C [Redesignated as
Subparts C and D] ‘‘award’’ refers to both ‘‘grant’’ and
§ 1600.30 What regulations must I follow? ‘‘cooperative agreement’’ unless
■ 224. Redesignate subparts B and C as otherwise indicated.
The DFC regulations that you must
follow are the regulations specified in subparts C and D. (c)(1) In general, research with foreign
■ 225. Add a new subpart B to read as organizations and foreign public entities
each applicable section of the OMB
regulation in subparts A through I of 2 follows: will not be conducted through grants or
CFR part 180 as that section is cooperative agreements, but instead will
Subpart B—General Provisions be accomplished on a no-exchange-of-
supplemented by the section in this part
with the same section number or by §§ 1800.2 and 1800.3 [Redesignated as funds basis. In these cases, NASA enters
additional provisions with no §§ 1800.100 and 1800.101 and Transferred into agreements undertaking projects of
corresponding section number. For any to Subpart B] international scientific collaboration.
section of OMB regulation in subparts A ■ 226. Redesignate §§ 1800.2 and 1800.3 NASA’s policy on performing research
through I of 2 CFR part 180 that has no as §§ 1800.100 and 1800.101 and with foreign organizations and foreign
corresponding section in this part, DFC transfer newly redesignated §§ 1800.100 public entities on a no-exchange-of-
khammond on DSK9W7S144PROD with PROPOSALS2
regulations are those in the OMB and 1800.101 to subpart B. funds basis is set forth at NASA FAR
regulation. ■ 227. Revise newly redesignated Supplement (NFS) at 48 CFR 1835.016–
■ 221. Revise § 1600.220 to read as §§ 1800.100 and 1800.101 to read as 70 and 1835.016–72. In rare instances,
follows: follows: NASA may enter into an international
agreement under which funds will be
§ 1600.220 What contracts and § 1800.100 Purpose. transferred to a foreign recipient.
subcontracts are covered transactions? This part adopts the Office of (2) Grants or cooperative agreements
First-tier procurements (i.e., primary Management and Budget (OMB) awarded to foreign organizations and
contracts) under a covered regulation in subparts A through F and foreign public entities are made on an
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32282 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
exceptional basis only. Awards require § 1880.20 Does this part apply to me? Subpart C—Responsibilities of
the prior approval of the Headquarters This part and, through this part, Participants Regarding Transactions
Office of International and Interagency pertinent portions of the OMB
Relations and the Headquarters Office of § 1880.332 What methods must I use to
regulation in subparts A through I of 2 pass requirements down to participants at
the General Counsel. Requests to issue CFR part 180 (see table 2 to 2 CFR lower tiers with whom I intend to do
awards to foreign organizations are to be 180.100(b)) apply to you if you are a— business?
coordinated through the Office of
Procurement, Procurement and Grants (a) Participant or principal in a You as a participant must include a
Policy Division. ‘‘covered transaction’’ (see subpart B of term or condition in lower-tier
2 CFR part 180 and the definition of transactions requiring lower-tier
■ 228. Revise part 1880 to read as
‘‘nonprocurement transaction’’ at 2 CFR participants to comply with subpart C of
follows: 180.970); 2 CFR part 180, as supplemented by this
PART 1880—NONPROCUREMENT (b) Respondent in a NASA suspension subpart.
DEBARMENT AND SUSPENSION or debarment action;
Subpart D—Responsibilities of Federal
Sec. (c) NASA debarment or suspension Agency Officials Regarding
1880.10 What does this part do? official; or Transactions
1880.20 Does this part apply to me? (d) NASA grants officer, agreements
1880.30 What policies and procedures must § 1880.437 What method do I use to
officer, or other official authorized to communicate to a participant the
I follow?
enter into any type of nonprocurement requirements described in the OMB
Subpart A—General transaction that is a covered transaction. regulation at 2 CFR 180.435?
1880.137 Who in NASA may grant an
§ 1880.30 What policies and procedures To communicate to a participant the
exception to let an excluded person
participate in a covered transaction?
must I follow? requirements described in 2 CFR
The NASA policies and procedures 180.435, you must include a term or
Subpart B—Covered Transactions condition in the transaction that
that you must follow are the policies
1880.220 What contracts and subcontracts,
and procedures specified in each requires the participant’s compliance
in addition to those listed in 2 CFR with subpart C of 2 CFR part 180, as
180.220, are covered transactions? applicable section of the OMB
regulation in subparts A through I of 2 supplemented by subpart C of this part,
Subpart C—Responsibilities of Participants CFR part 180, as that section is and requires the participant to include
Regarding Transactions supplemented by the section in this part a similar term or condition in lower-tier
1880.332 What methods must I use to pass with the same section number. The covered transactions.
requirements down to participants at contracts that are covered transactions,
lower tiers with whom I intend to do Subparts E–J [Reserved]
for example, are specified by 2 CFR
business?
180.220 as supplemented by § 1880.220. PART 1882—REQUIREMENTS FOR
Subpart D—Responsibilities of Federal For any section of OMB regulation in DRUG-FREE WORKPLACE
Agency Officials Regarding Transactions subparts A through I of 2 CFR part 180 (FINANCIAL ASSISTANCE)
1880.437 What method do I use to that has no corresponding section in
communicate to a participant the this part, NASA policies and procedures ■ 229. The authority citation for part
requirements described in the OMB are those in the OMB regulation. 1882 continues to read as follows:
regulation at 2 CFR 180.435?
Authority: 41 U.S.C. 701 et seq.; 51 U.S.C.
Subparts E–J [Reserved] Subpart A—General 20113(e).
Authority: Sec. 2455, Pub. L. 103–355, 108 § 1880.137 Who in NASA may grant an ■ 230. Revise § 1882.5 to read as
Stat. 3327 (31 U.S.C. 6101 note); 42 U.S.C. exception to let an excluded person
follows:
2473(c)(1); E.O. 12549, 51 FR 6370, 3 CFR, participate in a covered transaction?
1986 Comp., p. 189; E.O. 12689, 54 FR 34131, The Chief Acquisition Officer has the § 1882.5 What does this part do?
3 CFR, 1989 Comp., p. 235. authority to grant an exception to let an This part adopts the Office of
§ 1880.10 What does this part do? excluded person participate in a Management and Budget (OMB)
covered transaction, as provided in the regulation in subparts A through F of 2
This part adopts the Office of OMB regulation at 2 CFR 180.135. CFR part 182, as supplemented by this
Management and Budget (OMB) part, as the National Aeronautics and
regulation in subparts A through I of 2 Subpart B—Covered Transactions Space Administration (NASA) policies
CFR part 180, as supplemented by this and procedures for implementing the
part, as the National Aeronautics and § 1880.220 What contracts and
subcontracts, in addition to those listed in portion of the Drug-Free Workplace Act
Space Administration (NASA) policies of 1988 (41 U.S.C. 701–707, as
2 CFR 180.220, are covered transactions?
and procedures for nonprocurement amended, hereinafter referred to as ‘‘the
debarment and suspension. This part NASA extends coverage of Act’’) that applies to grants and
gives regulatory effect to the OMB nonprocurement suspension and cooperative agreements. This part gives
regulation for Federal awards issued by debarment requirements beyond first- regulatory effect to the OMB regulation
khammond on DSK9W7S144PROD with PROPOSALS2
NASA, as supplemented by this part. tier procurement contracts under a for Federal awards issued by NASA.
This part satisfies the requirements in covered nonprocurement action, to all Further, it supplements the OMB
section 3 of Executive Order 12549, lower tier subcontracts, at all dollar regulation with NASA-specific
‘‘Debarment and Suspension’’ (3 CFR, values, consistent with OMB regulation regulation.
1986 Comp., p. 189), Executive Order at 2 CFR 180.220(c) and the figure in the
12689, ‘‘Debarment and Suspension’’ (3 appendix at 2 CFR part 180. NASA does CHAPTER XIX—U.S. AGENCY FOR
CFR, 1989 Comp., p. 235), and 31 U.S.C. not permit subcontracting to suspended GLOBAL MEDIA
6101 note (section 2455, Pub. L. 103– or debarred entities at any tier, at any ■ 231. Revise part 1900 to read as
355, 108 Stat. 3327). dollar amount. follows:
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PART 1900—THE UNIFORM Comp., p. 189; E.O. 12689, 54 FR 34131, 3 official designated by the Director shall
ADMINISTRATIVE REQUIREMENTS, CFR, 1989 Comp., p. 235. explain the reason(s) for deviating from
COST PRINCIPLES, AND AUDIT the Governmentwide policy.
Subpart A—General
REQUIREMENTS FOR FEDERAL
AWARDS § 2000.10 What does this part do?
Subpart B—Covered Transactions
Sec. This part promulgates a regulation § 2000.220 What contracts and
1900.1 Adoption of 2 CFR part 200. adopting the Office of Management and subcontracts, in addition to those listed in
1900.2 [Reserved] Budget (OMB) regulation in subparts A 2 CFR 180.220, are covered transactions?
through I of 2 CFR part 180, establishing The NRC nonprocurement suspension
Authority: 5 U.S.C. 301; 2 CFR part 200.
the United States Nuclear Regulatory and debarment requirements apply only
§ 1900.1 Adoption of 2 CFR part 200. Commission (NRC) policies and to first-tier procurement contracts under
The U.S. Agency for Global Media procedures for nonprocurement a covered nonprocurement transaction.
adopts the Office of Management and debarment and suspension. NRC
Budget’s (OMB) regulation in 2 CFR part thereby gives regulatory effect to the Subpart C—Responsibilities of
200. This part gives regulatory effect to OMB regulation. It also supplements the Participants Regarding Transactions
the OMB regulation for Federal awards OMB regulation by identifying NRC § 2000.330 What method must be used to
made by the U.S. Agency for Global implementing officials and identifying pass requirements down to participants at
Media. See 2 CFR 200.110(a) regarding how to pass these requirements through lower tiers?
the process for amending 2 CFR part to other entities. A participant in a covered transaction
200. The U.S. Agency for Global Media must include a term or condition in any
§ 2000.20 Does this part apply to me?
may amend its adoption of 2 CFR part lower-tier covered transaction to require
200 if agency-specific additions, This part and, through this part, the participant of that transaction to—
clarifications, or exceptions to the pertinent portions of the OMB (a) Comply with subpart C of 2 CFR
Government-wide policies and regulation in subparts A through I of 2 part 180; and
procedures are required by Federal CFR part 180 (see table 2 to 2 CFR (b) Include a similar term or condition
statute or are approved by OMB. See 2 180.100(b)) apply to: in any covered transaction into which it
CFR 200.106. Any supplements to the (a) Participant or principal in a enters at the next lower tier.
OMB regulation as needed for the U.S. ‘‘covered transaction’’;
Agency for Global Media, including (b) Respondent in an NRC Subparts D through H [Reserved]
additions or clarifications, are set forth nonprocurement suspension or
in this chapter. debarment action; Subpart I—Definitions
(c) NRC debarment or suspension
§ 1900.2 [Reserved] official; or § 2000.930 Debarring official.
(d) NRC grants officer, agreements The debarring official for the United
CHAPTER XX—UNITED STATES NUCLEAR
officer, or other official authorized to States Nuclear Regulatory Commission
REGULATORY COMMISSION
enter into a covered nonprocurement is the Director, Office of Administration.
■ 232. Revise part 2000 to read as
follows: transaction. § 2000.1010 Suspending official.
§ 2000.30 What policies and procedures The suspending official for the United
PART 2000—NONPROCUREMENT must I follow? States Nuclear Regulatory Commission
DEBARMENT AND SUSPENSION is the Director, Office of Administration.
(a) The NRC policies and procedures
that you must follow are the policies ■ 233. Add part 2001 to read as follows:
Sec.
and procedures specified in each
Subpart A—General PART 2001—UNIFORM
applicable section of the OMB
2000.10 What does this part do? ADMINISTRATIVE REQUIREMENTS,
regulation in subparts A through I of 2
2000.20 Does this part apply to me? COST PRINCIPLES, AND AUDIT
CFR part 180, and those in this part. The
2000.30 What policies and procedures must REQUIREMENTS FOR FEDERAL
I follow? NRC has closely tracked OMB’s
AWARDS
2000.135 Who in the Nuclear Regulatory numbering scheme. For example, the
Commission may grant an exception to contracts under a nonprocurement Sec.
let an excluded person participate in a transaction that are covered transactions 2001.5 Adoption of 2 CFR part 200.
covered transaction? that are in 2 CFR 180.220 are 2001.6 [Reserved]
Subpart B—Covered Transactions supplemented by § 2000.220. Authority: 5 U.S.C. 301; sec. 2455, Pub. L.
(b) For any section of OMB regulation 103–355, 108 Stat. 3327 (31 U.S.C. 6101
2000.220 What contracts and subcontracts,
in addition to those listed in 2 CFR in subparts A through I of 2 CFR part note); E.O. 12549, 51 FR 6370, 3 CFR, 1986
180 that has no corresponding section in Comp., p. 189; E.O. 12689, 54 FR 34131, 3
180.220, are covered transactions?
this part, NRC requirements are those in CFR, 1989 Comp., p. 235.
Subpart C—Responsibilities of Participants the OMB regulation at 2 CFR part 180.
Regarding Transactions § 2001.5 Adoption of 2 CFR part 200.
2000.330 What method must be used to § 2000.135 Who in the Nuclear Regulatory The United States Nuclear Regulatory
pass requirements down to participants Commission may grant an exception to let Commission adopts the Office of
khammond on DSK9W7S144PROD with PROPOSALS2
at lower tiers? an excluded person participate in a covered Management and Budget’s (OMB)
transaction? regulation in 2 CFR part 200. This part
Subparts D through H [Reserved]
The Director, Office of Administration gives regulatory effect to the OMB
Subpart I—Definitions or another official designated by the regulation for Federal awards made by
2000.930 Debarring official. Director, has the authority to grant a the United States Nuclear Regulatory
2000.1010 Suspending official. written exception to let an excluded Commission. See 2 CFR 200.110(a)
Authority: 5 U.S.C. 301; sec. 2455, Pub. L. person participate in a covered regarding the process for amending 2
103–355, 108 Stat. 3327 (31 U.S.C. 6101 transaction, as provided in regulation at CFR part 200. The United States Nuclear
note); E.O. 12549, 51 FR 6370, 3 CFR, 1986 2 CFR 180.135. The Director or other Regulatory Commission may amend its
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32284 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
adoption of 2 CFR part 200 if agency- § 2200.20 Does this part apply to me? under a covered nonprocurement
specific additions, clarifications, or This part and, through this part, transaction.
exceptions to the Government-wide pertinent portions of the OMB
§ 2200.332 What methods must I use to
policies and procedures are required by regulation in subparts A through I of 2 pass requirements down to participants at
Federal statute or are approved by OMB. CFR part 180 (see table 2 to 2 CFR lower tiers with whom I intend to do
See 2 CFR 200.106. Any supplements to 180.100(b)) apply to you if you are a— business?
the OMB regulation as needed for the (a) Participant or principal in a You as a participant must include a
United States Nuclear Regulatory ‘‘covered transaction’’ (see subpart B of term or condition in lower-tier
Commission, including additions or 2 CFR part 180 and the definition of transactions requiring lower-tier
clarifications, are set forth in this ‘‘nonprocurement transaction’’ at 2 CFR participants to comply with subpart C of
chapter. 180.970); 2 CFR part 180.
(b) Respondent in a Corporation for
§ 2001.6 [Reserved] National and Community Service § 2200.437 What method do I use to
CHAPTER XXII—CORPORATION FOR suspension or debarment action; communicate to a participant the
NATIONAL AND COMMUNITY SERVICE (c) Corporation for National and requirements described in the OMB
Community Service debarment or regulation at 2 CFR 180.435?
■ 234. Revise part 2200 to read as
follows: suspension official; or To communicate to a participant the
(d) Corporation for National and requirements described in 2 CFR
PART 2200—NONPROCUREMENT Community Service grants officer, 180.435, you as an agency official must
DEBARMENT AND SUSPENSION agreements officer, or other official include a term or condition in the
authorized to enter into any type of transaction that requires the
Sec. nonprocurement transaction that is a participant’s compliance with subpart C
2200.10 What does this part do? covered transaction. of 2 CFR part 180, and requires the
2200.20 Does this part apply to me?
2200.30 What policies and procedures must
participant to include a similar term or
§ 2200.30 What policies and procedures
I follow? condition in lower-tier covered
must I follow?
2200.137 Who in the Corporation for transactions.
The Corporation for National and
National and Community Service may
Community Service policies and PART 2205—IMPLEMENTATION OF
grant an exception to let an excluded
person participate in a covered procedures that you must follow are the AND EXEMPTIONS TO 2 CFR
transaction? policies and procedures specified in
each applicable section of the OMB ■ 235. The authority citation for part
2200.220 What contracts and subcontracts,
in addition to those listed in 2 CFR regulation in subparts A through I of 2 2205 continues to read as follows:
180.220, are covered transactions? CFR part 180, as that section is Authority: 42 U.S.C. 12571(d),
2200.332 What methods must I use to pass supplemented by the section in this part 12571(e)(2)(B), 12581(l), 12581a(a),
requirements down to participants at with the same section number. The 12616(c)(2), 12651c(c), 12651d(h), 12651g(b),
lower tiers with whom I intend to do contracts that are covered transactions, 12653(a), 12653(h), 12653o(a), and 12657(a);
business? 2 CFR part 200; 45 CFR 2521.95, and
for example, are specified by 2 CFR 2540.110.
2200.437 What method do I use to
communicate to a participant the 180.220 as supplemented by § 2200.220.
For any section of OMB regulation in ■ 236. Revise § 2205.100 to read as
requirements described in the OMB
regulation at 2 CFR 180.435? subparts A through I of 2 CFR part 180 follows:
that has no corresponding section in § 2205.100 Purpose.
Authority: 31 U.S.C. 6101 note; 42 U.S.C.
12651c(c); E.O. 12549, 51 FR 6370, 3 CFR, this part, Corporation for National and The Corporation for National and
1986 Comp., p. 189; E.O. 12689, 54 FR 34131, Community Service policies and Community Service adopts the Office of
3 CFR, 1989 Comp., p. 235. procedures are those in the OMB Management and Budget’s (OMB)
regulation. regulation in 2 CFR part 200, except as
§ 2200.10 What does this part do?
§ 2200.137 Who in the Corporation for specified in this part. This part gives
This part adopts the Office of
National and Community Service may grant regulatory effect to the OMB regulation
Management and Budget (OMB)
an exception to let an excluded person for Federal awards issued by the
regulation in subparts A through I of 2 participate in a covered transaction? Corporation for National and
CFR part 180, as supplemented by this
The Chief Executive Officer (or Community Service and supplements
part, as the Corporation for National and
another official designated by the Chief the regulation for recipients of awards
Community Service policies and
Executive Officer) has the authority to from the Corporation. See 2 CFR
procedures for nonprocurement
grant an exception to let an excluded 200.110(a) regarding the process for
debarment and suspension. This part
person participate in a covered amending 2 CFR part 200.
gives regulatory effect for the
transaction, as provided in the OMB
Corporation for National and § 2205.332 [Redesignated as § 2205.333]
regulation at 2 CFR 180.135.
Community Service to the OMB ■ 237. Redesignate § 2205.332 as
regulation for Federal awards issued by § 2200.220 What contracts and § 2205.333.
the Corporation for National subcontracts, in addition to those listed in
Community Service, as supplemented 2 CFR 180.220, are covered transactions? PART 2245—REQUIREMENTS FOR
khammond on DSK9W7S144PROD with PROPOSALS2
by this part. This part satisfies the Although the OMB regulation at 2 DRUG-FREE WORKPLACE
requirements in section 3 of Executive CFR 180.220(c) allows a Federal agency (FINANCIAL ASSISTANCE)
Order 12549, ‘‘Debarment and to do so (also see optional lower tier
■ 238. The authority citation for part
Suspension’’ (3 CFR, 1986 Comp., p. coverage in the figure in appendix A to
2245 continues to read as follows:
189), Executive Order 12689, 2 CFR part 180), Corporation for
‘‘Debarment and Suspension’’ (3 CFR, National and Community Service does Authority: 41 U.S.C. 701–707; 42 U.S.C.
1989 Comp., p. 235), and 31 U.S.C. 6101 not extend coverage of nonprocurement 12644, 12651c(c).
note (section 2455, Pub. L. 103–355, 108 suspension and debarment requirements ■ 239. Revise §§ 2245.10 through
Stat. 3327). beyond first-tier procurement contracts 2245.30 to read as follows:
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Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules 32285
§ 2245.10 What does this part do? with the Act that are the same as those § 2245.30 What policies and procedures
This part requires that the award and of other Federal agencies, in must I follow?
administration of the Corporation for conformance with the requirement in 41 (a) General. You must follow the
National and Community Service’s U.S.C. 705 for Government-wide policies and procedures specified in
(Corporation) grants and cooperative implementing regulations. applicable sections of the OMB
agreements comply with Office of regulation in subparts A through F of 2
Management and Budget (OMB) § 2245.20 Does this part apply to me? CFR part 182, as implemented by this
regulation implementing the portion of This part and, through this part, part.
the Drug-Free Workplace Act of 1988 pertinent portions of the OMB (b) Specific sections of OMB
(41 U.S.C. 701–707, as amended, regulation in subparts A through F of 2 regulation that this part supplements. In
hereinafter referred to as ‘‘the Act’’) that CFR part 182 (see 2 CFR 182.115(b)) implementing the OMB regulation in 2
applies to grants. This part— CFR part 182, this part supplements
apply to you if you are a—
(a) Gives regulatory effect to the OMB four sections of the OMB regulation, as
regulation (subparts A through F of 2 (a) Recipient of a Corporation grant or shown in the following table. For each
CFR part 182) for the Corporation’s cooperative agreement; or of those sections, you must follow the
grants and cooperative agreements; and (b) A Corporation awarding official. policies and procedures in the OMB
(b) Establishes the Corporation’s regulation, as supplemented by this
policies and procedures for compliance part.
Section in this
Section of OMB part where What the supplementation clarifies
regulation supplemented
(1) 2 CFR 182.225(a) ..... § 2245.225 ........ Whom in the Corporation a recipient other than an individual must notify if an employee is con-
victed for a violation of a criminal drug statute in the workplace.
(2) 2 CFR 182.300(b) ..... § 2245.300 ........ Whom in the Corporation a recipient who is an individual must notify if he or she is convicted of a
criminal drug offense resulting from a violation occurring during the conduct of any award activ-
ity.
(3) 2 CFR 182.500 ......... § 2245.500 ........ Who in the Corporation is authorized to determine that a recipient other than an individual is in
violation of the requirements of 2 CFR part 182, as implemented by this part.
(4) 2 CFR 182.505 ......... § 2245.505 ........ Who in the Corporation is authorized to determine that a recipient who is an individual is in viola-
tion of the requirements of 2 CFR part 182, as implemented by this part.
(c) Sections of the OMB regulation PART 2300—UNIFORM Subpart A—General
that this part does not supplement. For ADMINISTRATIVE REQUIREMENTS, 2336.137 Who in the SSA may grant an
any section of OMB regulation in COST PRINCIPLES, AND AUDIT exception to let an excluded person
subparts A through F of 2 CFR part 182 REQUIREMENTS FOR FEDERAL participate in a covered transaction?
that is not listed in paragraph (b) of this AWARDS Subpart B—Covered Transactions
section, the Corporation’s policies and 2336.220 What contracts and subcontracts,
Sec.
procedures are the same as those in the 2300.10 Applicable regulations. in addition to those listed in 2 CFR
OMB regulation. 2300.11 [Reserved] 180.220, are covered transactions?
■ 240. Revise § 2245.400 to read as Authority: 5 U.S.C. 301; 2 CFR part 200. Subpart C—Responsibilities of Participants
follows: Regarding Transactions
§ 2300.10 Applicable regulations. 2336.332 What methods must I use to pass
§ 2245.400 What method do I use as an requirements down to participants at
agency awarding official to obtain a The Uniform Administrative
lower tiers with whom I intend to do
recipient’s agreement to comply with the Requirements, Cost Principles, and business?
OMB regulation? Audit Requirements for Federal Awards
set forth in 2 CFR part 200 shall apply Subpart D—Responsibilities of Federal
To obtain a recipient’s agreement to to the Social Security Administration. Agency Officials Regarding Transactions
comply with applicable requirements in This part gives regulatory effect to the 2336.437 What method do I use to
the OMB regulation at 2 CFR part 182, Office of Management and Budget communicate to a participant the
you must obtain each recipient’s regulation for Federal awards issued by requirements described in the OMB
agreement, as a condition of the award, the Social Security Administration. See regulation at 2 CFR 180.435?
to comply with the requirements in 2 CFR 200.110(a) regarding the process Subparts E–J [Reserved]
subpart B (or subpart C, if the recipient for amending 2 CFR part 200.
is an individual) of this part, which Authority: 42 U.S.C. 902(a)(5); sec. 2455,
adopts the Government-wide § 2300.11 [Reserved] Pub. L. 103–355, 108 Stat. 3327 (31 U.S.C.
6101 note); E.O. 12549, 51 FR 6370, 3 CFR,
implementation (2 CFR part 182) of sec. ■ 242. Revise part 2336 to read as 1986 Comp., p. 189; E.O. 12689, 54 FR 34131,
5152–5158 of the Drug-Free Workplace
khammond on DSK9W7S144PROD with PROPOSALS2
follows: 3 CFR, 1989 Comp., p. 235.
Act of 1988 (Pub. L. 100–690, Title V,
Subtitle D; 41 U.S.C. 701–707). PART 2336—NONPROCUREMENT § 2336.10 What does this part do?
DEBARMENT AND SUSPENSION This part adopts the Office of
CHAPTER XXIII—SOCIAL SECURITY
ADMINISTRATION Sec. Management and Budget (OMB)
2336.10 What does this part do? regulation in subparts A through I of 2
■ 241. Revise part 2300 to read as CFR part 180, as supplemented by this
2336.20 Does this part apply to me?
follows: 2336.30 What policies and procedures must part, as the Social Security
I follow? Administration (SSA) policies and
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32286 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
procedures for nonprocurement participate in a particular covered Subparts E–J [Reserved]
debarment and suspension. This part transaction. If the Commissioner or the
satisfies the requirements in section 3 of designated agency debarment official PART 2339—REQUIREMENTS FOR
Executive Order 12549, ‘‘Debarment and grants an exception, the exception must DRUG-FREE WORKPLACE
Suspension’’ (3 CFR, 1986 Comp., p. be in writing and state the reason(s) for (FINANCIAL ASSISTANCE)
189), Executive Order 12689, deviating from the OMB regulation at 2
■ 243. The authority citation for part
‘‘Debarment and Suspension’’ (3 CFR, CFR 180.135.
2339 continues to read as follows:
1989 Comp., p. 235), and 31 U.S.C. 6101 (b) An exception granted by one
note (section 2455, Pub. L. 103–355, 108 Authority: 41 U.S.C. 701–707.
agency for an excluded person does not
Stat. 3327). extend to the covered transactions of ■ 244. Revise §§ 2339.10 through
§ 2336.20 Does this part apply to me? another agency. 2339.30 to read as follows:
This part and, through this part, Subpart B—Covered Transactions § 2339.10 What does this part do?
pertinent portions of the OMB This part requires that the award and
regulation in subparts A through I of 2 § 2336.220 What contracts and administration of Social Security
CFR part 180 (see table 2 to 2 CFR subcontracts, in addition to those listed in Administration (SSA) grants and
180.100(b)) apply to you if you are a— 2 CFR 180.220, are covered transactions?
cooperative agreements comply with
(a) Participant or principal in a Although the OMB regulation at 2 Office of Management and Budget
‘‘covered transaction’’ (see subpart B of CFR 180.220(c) allows a Federal agency (OMB) regulation implementing the
2 CFR part 180 and the definition of to do so (also see option lower tier portion of the Drug-Free Workplace Act
‘‘nonprocurement transaction’’ at 2 CFR coverage in the figure in appendix A to of 1988 (41 U.S.C. 701–707, as
180.970); 2 CFR part 180), SSA does not extend amended, hereinafter referred to as ‘‘the
(b) Respondent in an SSA suspension Act’’) that applies to grants. This part—
coverage of nonprocurement suspension
or debarment action; (a) Gives regulatory effect to the OMB
and debarment requirements beyond
(c) SSA debarment or suspension regulation (subparts A through F of 2
first-tier procurement contracts under a
official; or CFR part 182) for SSA’s grants and
(d) SSA grants officer, agreements covered nonprocurement transaction.
cooperative agreements; and
officer, or other official authorized to Subpart C—Responsibilities of (b) Establishes SSA’s policies and
enter into any type of nonprocurement Participants Regarding Transactions procedures for compliance with the Act
transaction that is a covered transaction.
that are the same as those of other
§ 2336.332 What methods must I use to
§ 2336.30 What policies and procedures Federal agencies, in conformance with
pass requirements down to participants at
must I follow? lower tiers with whom I intend to do the requirement in 41 U.S.C. 705 for
The SSA policies and procedures that business? Government-wide implementing
you must follow are the policies and regulations.
procedures specified in each applicable You as a participant must include a
term or condition in lower-tier § 2339.20 Does this part apply to me?
section of the OMB regulation in
subparts A through I of 2 CFR part 180, transactions requiring lower-tier This part and, through this part,
as supplemented by the section in this participants to comply with subpart C of pertinent portions of the OMB
part with the same section number. The 2 CFR part 180, as supplemented by this regulation in subparts A through F of 2
contracts that are covered transactions, subpart. CFR part 182 (see 2 CFR 182.115(b))
for example, are specified by 2 CFR apply to you if you are—
Subpart D—Responsibilities of Federal (a) A recipient of an SSA grant or
180.220, as supplemented by
Agency Officials Regarding cooperative agreement; or
§ 2336.220. For any section of OMB
Transactions (b) An SSA awarding official.
regulation in subparts A through I of 2
CFR part 180 that has no corresponding § 2336.437 What method do I use to § 2339.30 What policies and procedures
section in this part, SSA policies and communicate to a participant the must I follow?
procedures are those in the OMB requirements described in the OMB
(a) General. You must follow the
regulation. regulation at 2 CFR 180.435?
policies and procedures specified in
Subpart A—General To communicate to a participant the applicable sections of the OMB
requirements described in 2 CFR regulation in subparts A through F of 2
§ 2336.137 Who in the SSA may grant an 180.435, you must include a term or CFR part 182, as implemented by this
exception to let an excluded person condition in the transaction that part.
participate in a covered transaction? requires the participant’s compliance (b) Specific sections of OMB
(a) Within the Social Security with subpart C of 2 CFR part 180, as regulation that this part supplements. In
Administration, the Commissioner or supplemented by subpart C of this part, implementing the OMB regulation in 2
the designated agency debarment and requires the participant to include CFR part 182, this part supplements
official may grant an exception a similar term or condition in lower-tier four sections of the OMB regulation, as
permitting an excluded person to covered transactions. shown in the following table.
khammond on DSK9W7S144PROD with PROPOSALS2
Section in this
Section of OMB part where
regulation What the supplementation clarifies
supplemented,
in 2 CFR 2 CFR
(1) 182.225(a) .......... § 2339.225 ........ Who in SSA a recipient other than an individual must notify if an employee is convicted for a violation
of a criminal drug statute in the workplace.
(2) 182.300(b) .......... § 2339.300 ........ Who in SSA a recipient who is an individual must notify if he or she is convicted of a criminal drug of-
fense resulting from a violation occurring during the conduct of any award activity.
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Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules 32287
Section in this
Section of OMB part where
regulation What the supplementation clarifies
supplemented,
in 2 CFR 2 CFR
(3) 182.500 .............. § 2339.500 ........ Who in SSA is authorized to determine that a recipient other than an individual is in violation of the re-
quirements of 2 CFR part 182, as implemented by this part.
(4) 182.505 .............. § 2339.505 ........ Who in SSA is authorized to determine that a recipient who is an individual is in violation of the re-
quirements of 2 CFR part 182, as implemented by this part.
(c) Sections of the OMB regulation § 2400.11 [Reserved] § 2424.220 What contracts and
that this part does not supplement. Our subcontracts, in addition to those listed in
policies and procedures are the same as PART 2424—NONPROCUREMENT 2 CFR 180.220, are covered transactions?
those in the OMB regulation for any DEBARMENT AND SUSPENSION In addition to the contracts covered
section not included in the table in ■ 247. The authority citation for part under 2 CFR 180.220(b), this part
paragraph (b) of this section. 2424 continues to read as follows: applies to any contract, regardless of
■ 245. Revise § 2339.400 to read as tier, that is awarded by a contractor,
Authority: Sec. 2455, Pub. L. 103–355, 108
follows: Stat. 3327; E.O. 12549, 3 CFR, 1986 Comp.,
subcontractor, supplier, consultant, or
p. 189; E.O. 12689, 3 CFR, 1989 Comp., p. its agent or representative in any
§ 2339.400 What method do I use as an 235. transaction, if the contract is to be
agency awarding official to obtain a funded or provided by HUD under a
recipient’s agreement to comply with the ■ 248. Revise § 2424.10 to read as
covered nonprocurement transaction
OMB regulation? follows: and the amount of the contract is
You must include the following term § 2424.10 What does this part do? expected to equal or exceed $25,000.
or condition in the award: In this part, the Department of This extends the coverage of the HUD
Housing and Urban Development (HUD) nonprocurement suspension and
Drug-free workplace. You, as the
implements, as HUD policies, debarment requirements to all lower
recipient, must comply with drug-free
procedures, and requirements for tiers of subcontracts under covered
workplace requirements in subpart B,
nonprocurement debarment and nonprocurement transactions, as
which adopts the Government-wide
suspension, the Office of Management permitted under the OMB regulation at
implementation (2 CFR part 182) of sec.
and Budget (OMB) regulation in 2 CFR 180.220(c) (see optional lower-
5152–5158 of the Drug-Free Workplace
subparts A through I of 2 CFR part 180, tier coverage in the figure in appendix
Act of 1988 (Pub. L. 100–690, Title V,
as supplemented by this part. This A to 2 CFR part 180).
Subtitle D; 41 U.S.C. 701–707).
adoption thereby gives regulatory effect ■ 251. Revise § 2424.332 to read as
CHAPTER XXIV—DEPARTMENT OF follows:
for HUD to the OMB regulation for
HOUSING AND URBAN DEVELOPMENT
Federal awards issued by HUD, as § 2424.332 What methods must I use to
■ 246. Revise part 2400 to read as supplemented by this part. This part pass requirements down to participants at
follows: satisfies the requirements in section 3 of lower tiers with whom I intend to do
Executive Order 12549, ‘‘Debarment and business?
PART 2400—UNIFORM Suspension’’ (3 CFR, 1986 Comp., p.
ADMINISTRATIVE REQUIREMENTS, To communicate the requirements to
189), Executive Order 12689, lower-tier participants, you must
COST PRINCIPLES AND AUDIT ‘‘Debarment and Suspension’’ (3 CFR,
REQUIREMENTS FOR FEDERAL include a term or condition in the
1989 Comp., p. 235), and 31 U.S.C. 6101 transaction requiring compliance with
AWARDS note (section 2455, Pub. L. 103–355, 108 subpart C of 2 CFR part 180, as
Sec. Stat. 3327). supplemented by this subpart.
2400.10 Applicable regulations. ■ 249. Revise § 2424.30 to read as
■ 252. Revise § 2424.437 to read as
2400.11 [Reserved] follows:
follows:
Authority: 42 U.S.C. 3535(d); 2 CFR part § 2424.30 What policies and procedures
200. must I follow? § 2424.437 What method do I use to
communicate to a participant the
§ 2400.10 Applicable regulations.
The HUD policies and procedures that requirements described in the OMB
you must follow are the policies and regulation at 2 CFR 180.435?
Unless excepted under 24 CFR procedures specified in each applicable
To communicate to a participant the
subtitle B, chapters I through IX, the section of the OMB regulation in
requirements described in 2 CFR
Uniform Administrative Requirements, subparts A through I of 2 CFR part 180,
180.435, you must include a term or
Cost Principles, and Audit as that section is supplemented by the
condition in the transaction that
Requirements for Federal Awards, set section in this part with the same
requires the participant to: comply with
forth in 2 CFR part 200, shall apply to section number. The contracts that are
subpart C of 2 CFR part 180, as
Federal awards made by the Department covered transactions, for example, are
supplemented by subpart C of this part,
khammond on DSK9W7S144PROD with PROPOSALS2
of Housing and Urban Development to specified by 2 CFR 180.220, as
and include a similar term or condition
non-Federal entities. This part gives supplemented by § 2424.220. For any
in lower-tier covered transactions.
regulatory effect to the Office of section of OMB regulation in subparts A
Management and Budget (OMB) through I of 2 CFR part 180 that has no PART 2429—REQUIREMENTS FOR
regulation for Federal awards issued by corresponding section in this part, HUD DRUG-FREE WORKPLACE
the Department of Housing and Urban policies and procedures are those in the (FINANCIAL ASSISTANCE)
Development. See 2 CFR 200.110(a) OMB regulation.
regarding the process for amending 2 ■ 250. Revise § 2424.220 to read as ■ 253. The authority citation for part
CFR part 200. follows: 2429 continues to read as follows:
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32288 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
Authority: 41 U.S.C. 701–707; 42 U.S.C. CFR part 182) for HUD grants and § 2429.30 What policies and procedures
3535(d). cooperative agreements; and must I follow?
(b) Establishes HUD policies and (a) General. You must follow the
■ 254. Revise §§ 2429.10 through
procedures for compliance with the Act policies and procedures specified in
2429.30 to read as follows:
that are the same as those of other applicable sections of the OMB
§ 2429.10 What does this part do? Federal agencies, in conformance with regulation in subparts A through F of 2
This part requires that the award and the requirement in 41 U.S.C. 705 for CFR part 182, as implemented by this
administration of Department of Governmentwide implementing part.
Housing and Urban Development (HUD) regulations.
(b) Specific sections of OMB
grants and cooperative agreements § 2429.20 Does this part apply to me? regulation that this part supplements. In
comply with Office of Management and This part, and through this part, implementing the OMB regulation in 2
Budget (OMB) regulation implementing pertinent portions of the OMB CFR part 182, this part supplements
the portion of the Drug-Free Workplace regulation in subparts A through F of 2 four sections of the OMB regulation, as
Act of 1988 (41 U.S.C. 701–707) CFR part 182 (see 2 CFR 182.115(b)) shown in the following table. For each
(referred to as the Act in this part) that apply to you if you are a: of those sections, you must follow the
applies to grants. This part: (a) Recipient of a HUD grant or policies and procedures of the OMB
(a) Gives regulatory effect to the OMB cooperative agreement; or regulation, as supplemented by this
regulation (subparts A through F of 2 (b) HUD awarding official. part.
Section in this
Section of OMB part where What the supplementation clarifies
regulation supplemented
(1) 2 CFR § 2429.225 ........ Whom in HUD must a recipient other than an individual notify if an employee is convicted for a viola-
182.225(a). tion of a criminal drug statute in the workplace?
(2) 2 CFR § 2429.300 ........ Whom in HUD must a recipient who is an individual notify if he or she is convicted of a criminal drug
182.300(b). offense resulting from a violation occurring during the conduct of any award activity?
(3) 2 CFR 182.500 .. § 2429.500 ........ Who in HUD is authorized to determine that a recipient other than an individual is in violation of the
requirements of 2 CFR part 182, as implemented by this part?
(4) 2 CFR 182.505 .. § 2429.505 ........ Who in HUD is authorized to determine that a recipient who is an individual is in violation of the re-
quirements of 2 CFR part 182, as implemented by this part?
(c) Sections of the OMB regulation PART 2500—UNIFORM Report (FFR) and the NSF FastLane
that this part does not supplement. For ADMINISTRATIVE REQUIREMENTS, Cash Request process with a single web-
any section of OMB regulation in COST PRINCIPLES, AND AUDIT based user interface. ACM$ is used to
subparts A through F of 2 CFR part 182 REQUIREMENTS FOR FEDERAL collect award level detail financial
that is not listed in paragraph (b) of this AWARDS information at the time of each payment
section, HUD policies and procedures request submitted by the awardee
are the same as those in the OMB Sec.
2500.10 Adoption of 2 CFR part 200. institution. The Program Income
regulation. Worksheet is used to collect program
2500.11 [Reserved]
■ 255. Revise § 2429.400 to read as income financial information from
Authority: 42 U.S.C. 1861, et seq.; 2 CFR
follows: awardee institutions on an annual basis.
part 200.
§ 2429.400 What method do I use as an
ACM$ and the Program Income
§ 2500.10 Adoption of 2 CFR part 200. Worksheet utilize approved
agency awarding official to obtain a
recipient’s agreement to comply with the (a) Under the authority cited for this Government-wide data elements from
OMB regulation? part, the National Science Foundation the FFR for the collection of financial
To obtain a recipient’s agreement to (NSF) has formally adopted 2 CFR part information as prescribed in 2 CFR
comply with applicable requirements in 200. This part adopts the Office of 200.328. The requirement for Federal
the OMB regulation at 2 CFR part 182, Management and Budget (OMB) agencies to use the FFR data elements
you must include the following term or regulation for Federal awards issued by for cash management and financial
condition in the award: the NSF. See 2 CFR 200.110(a) regarding reporting was publicly announced in
the process for amending 2 CFR part Federal Register on August 13, 2008.
Drug-free workplace. You as the
200.The Foundation’s implementation
recipient must comply with drug-free (2) [Reserved]
document, the NSF Proposal & Award
workplace requirements in subpart B (or
Policies & Procedures Guide, may be § 2500.11 [Reserved]
subpart C, if the recipient is an
found at: www.nsf.gov/publications/
individual) of part 2429, which ■ 257. Revise and republish part 2520 to
pub_summ.jsp?ods_key=papp.
implements the governmentwide read as follows:
implementation (2 CFR part 182) of (b) NSF’s implementation includes
khammond on DSK9W7S144PROD with PROPOSALS2
sections 5152–5158 of the Drug-Free the following deviation from the
PART 2520—NONPROCUREMENT
Workplace Act of 1988 (Pub. L. 100– Uniform Grants Regulation:
DEBARMENT AND SUSPENSION
690, Title V, Subtitle D; 41 U.S.C. 701– (1) Award Cash Management System.
707). NSF is continuing collection of award Sec.
financial information through the 2520.10 What does this part do?
CHAPTER XXV—NATIONAL SCIENCE implementation of the Award Cash 2520.20 Does this part apply to me?
FOUNDATION Management Service (ACM$) and the 2520.30 What policies and procedures must
■ 256. Revise part 2500 to read as Program Income Worksheet. ACM$ I follow?
follows: replaced the NSF Federal Financial
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Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules 32289
Subpart A—General § 2520.30 What policies and procedures with subpart C of 2 CFR part 180, as
2520.137 Who in NSF may grant an must I follow? supplemented by subpart C of this part,
exception to let an excluded person The NSF policies and procedures that and requires the participant to include
participate in a covered transaction? you must follow are the policies and a similar term or condition in lower-tier
Subpart B—Covered Transactions procedures specified in each applicable covered transactions.
section of the OMB regulation in
2520.220 What contracts and subcontracts, Subparts E–I [Reserved]
in addition to those listed in 2 CFR
subparts A through I of 2 CFR part 180,
180.220, are covered transactions? as that section is supplemented by the CHAPTER XXVI—NATIONAL ARCHIVES
section in this part with the same AND RECORDS ADMINISTRATION
Subpart C—Responsibilities of Participants section number. The contracts that are
Regarding Transactions ■ 258. Revise part 2600 to read as
covered transactions, for example, are follows:
2520.332 What methods must I use to pass specified by 2 CFR 180.220 as
requirements down to participants at supplemented by § 2520.220. For any
lower tiers with whom I intend to do
PART 2600—UNIFORM
section of OMB regulation in subparts A ADMINISTRATIVE REQUIREMENTS,
business?
through I of 2 CFR part 180 that has no COST PRINCIPLES, AND AUDIT
Subpart D—Responsibilities of Federal corresponding section in this part, NSF REQUIREMENTS FOR FEDERAL
Agency Officials Regarding Transactions policies and procedures are those in the AWARDS
2520.437 What method do I use to OMB regulation.
communicate to a participant the Sec.
requirements described in the OMB Subpart A—General 2600.100 Adoption of 2 CFR part 200.
regulation at 2 CFR 180.435? 2600.101 Indirect costs exception to 2 CFR
§ 2520.137 Who in NSF may grant an 200.414.
Subparts E–I [Reserved] exception to let an excluded person 2600.102 Additional NARA grant
participate in a covered transaction? administration policies.
Authority: 42 U.S.C. 1870(a); sec. 2455,
Pub. L. 103–355, 108 Stat. 3327 (31 U.S.C. The NSF Director and the Deputy Authority: 5 U.S.C. 301; 44 U.S.C. 2103–
6101 note); E.O. 12549, 51 FR 6370, 3 CFR, Director have the authority to grant an 04; 44 U.S.C. 2501–2506; 2 CFR part 200.
1986 Comp., p. 189; E.O. 12689, 54 FR 34131, exception to let an excluded person
3 CFR, 1989 Comp., p. 235. participate in a covered transaction. § 2600.100 Adoption of 2 CFR part 200.
The National Archives and Records
§ 2520.10 What does this part do? Subpart B—Covered Transactions Administration (NARA), through its
This part adopts the Office of National Historical Publications and
§ 2520.220 What contracts and
Management and Budget (OMB) Records Commission (NHPRC), adopts
subcontracts, in addition to those listed in
regulation in subparts A through I of 2 2 CFR 180.220, are covered transactions? the Office of Management and Budget
CFR part 180, as supplemented by this (OMB) regulation in 2 CFR part 200,
Although the OMB regulation at 2
part, as the National Science with the additions and exceptions
CFR 180.220(c) allows a Federal agency
Foundation (NSF) policies and included in this part. This part gives
to do so (also see optional lower tier
procedures for nonprocurement regulatory effect to the OMB regulation
coverage in the figure in appendix A to
debarment and suspension. This part for Federal awards issued by NARA. See
2 CFR part 180), NSF does not extend
gives regulatory effect for NSF to the 2 CFR 200.110(a) regarding the process
coverage of nonprocurement suspension
OMB regulation as supplemented by for amending 2 CFR part 200.
and debarment requirements beyond
this part. This part satisfies the
first-tier procurement contracts under a § 2600.101 Indirect costs exception to 2
requirements in section 3 of Executive
covered nonprocurement transaction. CFR 200.414.
Order 12549, ‘‘Debarment and
Suspension’’ (3 CFR, 1986 Comp., p. As approved by the Archivist of the
Subpart C—Responsibilities of United States, the National Archives
189), Executive Order 12689, Participants Regarding Transactions
‘‘Debarment and Suspension’’ (3 CFR, does not permit grant recipients to use
1989 Comp., p. 235), and 31 U.S.C. 6101 § 2520.332 What methods must I use to allocated funds from NARA or NHPRC
note (section 2455, Pub. L. 103–355, 108 pass requirements down to participants at for indirect costs. Grant recipients may
Stat. 3327). lower tiers with whom I intend to do use cost sharing to cover indirect costs
business? instead. NARA’s policies on indirect
§ 2520.20 Does this part apply to me? You as a participant must include a costs are located at www.archives.gov/
This part and, through this part, term or condition in lower-tier nhprc, and are included in grant
pertinent portions of the OMB transactions requiring lower-tier opportunity announcements.
regulation in subparts A through I of 2 participants to comply with subpart C of § 2600.102 Additional NARA grant
CFR part 180 (see table 2 to 2 CFR 2 CFR part 180, as supplemented by this administration policies.
180.100(b)) apply to you if you are a— subpart. Grant recipients must also follow
(a) Participant or principal in a NARA grant administration policies and
‘‘covered transaction’’ (see subpart B of Subpart D—Responsibilities of Federal
Agency Officials Regarding procedures set out in 36 CFR parts 1202,
2 CFR part 180 and the definition of 1206, 1208, 1211, and 1212.
‘‘nonprocurement transaction’’ at 2 CFR Transactions
khammond on DSK9W7S144PROD with PROPOSALS2
180.970). CHAPTER XXVII—SMALL BUSINESS
§ 2520.437 What method do I use to ADMINISTRATION
(b) Respondent in an NSF suspension communicate to a participant the
or debarment action. requirements described in the OMB PART 2700—NONPROCUREMENT
(c) NSF debarment or suspension regulation at 2 CFR 180.435?
DEBARMENT AND SUSPENSION
official. To communicate to a participant the
(d) NSF grants officer, agreements requirements described in 2 CFR ■ 259. The authority citation for part
officer, or other official authorized to 180.435, you must include a term or 2700 continues to read as follows:
enter into any type of nonprocurement condition in the transaction that Authority: Sec. 2455, Pub. L. 103–355, 108
transaction that is a covered transaction. requires the participant’s compliance Stat. 3327 (31 U.S.C. 6101 note); E.O. 12549
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32290 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
(3 CFR, 1986 Comp., p. 189); E.O. 12689 (3 Subpart B—Covered Transactions ■ 263. Revise § 2701.1 to read as
CFR, 1989, 1986 Comp., p. 235); 15 U.S.C. follows:
634(b)(6). § 2700.220 What contracts and
subcontracts, in addition to those listed in § 2701.1 Adoption of 2 CFR part 200.
■ 260. Revise §§ 2700.10 through 2 CFR 180.220, are covered transactions?
2700.30 to read as follows: The U.S. Small Business
In addition to the contracts covered Administration (SBA) adopts the Office
§ 2700.10 What does this part do? under 2 CFR 180.22(b), this part applies of Management and Budget (OMB)
This part adopts the Office of to any contract, regardless of tier, that is regulation in 2 CFR part 200, with the
Management and Budget (OMB) awarded by a contractor, subcontractor, additions and exceptions included in
regulation in subparts A through I of 2 supplier, consultant, or its agent or this part. This part gives regulatory
CFR part 180, as supplemented by this representative in any transaction, if the effect to the OMB regulation for Federal
part, as the Small Business contract is to be funded or provided by awards issued by the Small Business
Administration (SBA) policies and the SBA under a covered Administration. See 2 CFR 200.110(a)
procedures for nonprocurement nonprocurement transaction and the regarding the process for amending 2
debarment and suspension. This part amount of the contract is expected to CFR part 200.
gives regulatory effect for SBA to the equal or exceed $25,000. This extends ■ 264. Revise the heading for § 2701.600
OMB regulation as supplemented by the coverage of the SBA to read as follows:
this part. This part satisfies the nonprocurement suspension and
§ 2701.600 Other program-specific
requirements in section 3 of Executive debarment requirements to all lower regulations.
Order 12549, ‘‘Debarment and tiers of subcontracts under covered
Suspension’’ (3 CFR, 1986 Comp., p. nonprocurement transactions, as CHAPTER XXVIII—DEPARTMENT OF
189); Executive Order 12689, permitted under the OMB regulation at JUSTICE
‘‘Debarment and Suspension’’ (3 CFR, 2 CFR 180.200(c) (see optional lower
PART 2800—UNIFORM
1989 Comp., p. 235); and section 2455 tier coverage in the figure in appendix
ADMINISTRATIVE REQUIREMENTS,
of the Federal Acquisition Streamlining A to 2 CFR part 180).
COST PRINCIPLES, AND AUDIT
Act of 1994, Public Law 103–355 (31 REQUIREMENTS FOR FEDERAL
U.S.C. 6101 note). Subpart C—Responsibilities of
Participants Regarding Transactions AWARDS BY THE DEPARTMENT OF
§ 2700.20 Does this part apply to me? JUSTICE
§ 2700.332 What methods must I use to
This part and, through this part, pass requirements down to participants at ■ 265. The authority citation for part
pertinent portions of the OMB lower tiers with whom I intend to do 2800 continues to read as follows:
regulation in subparts A through I of 2 business? Authority: 5 U.S.C. 301; 28 U.S.C. 509; 28
CFR part 180 (see table 2 to 2 CFR U.S.C. 530C(a)(4); 42 U.S.C. 3789; 2 CFR part
180.100(b)) apply to you if you are a— You, as a participant, must include a
200.
(a) Participant or principal in a term or condition in lower-tier
‘‘covered transaction’’ (see subpart B of transactions requiring lower-tier § 2800.101 [Redesignated as § 2800.10]
2 CFR part 180 and the definition of participants to comply with subpart C of ■ 266. Redesignate § 2800.101 as
‘‘nonprocurement transaction’’ at 2 CFR 2 CFR part 180, as supplemented by this § 2800.10.
180.970); part.
■ 267. Revise newly redesignated
(b) Respondent in an SBA suspension Subpart D—Responsibilities of Federal § 2800.10 to read as follows:
or debarment action; Agency Officials Regarding § 2800.10 Adoption of 2 CFR part 200.
(c) SBA debarment or suspension Transactions
official; or The Department of Justice adopts the
(d) SBA grants officer, agreements § 2700.437 What method do I use to Office of Management and Budget
officer, or other official authorized to communicate to a participant the (OMB) regulation in 2 CFR part 200,
requirements described in the OMB except as otherwise may be provided by
enter into any type of nonprocurement regulation at 2 CFR 180.435?
transaction that is a covered transaction. this part. This part gives regulatory
To communicate to a participant the effect to the OMB regulation for Federal
§ 2700.30 What policies and procedures requirements described in 2 CFR awards issued by the Department of
must I follow? Justice. See 2 CFR 200.110(a) regarding
180.435, you must include a term or
The SBA policies and procedures you condition in the transaction that the process for amending 2 CFR part
must follow are the policies and requires the participant’s compliance 200. Except for the Department of
procedures specified in each applicable with subpart C of 2 CFR part 180, as Justice’s adoption of 2 CFR part 200,
section of the OMB regulation in supplemented by subpart C of this part, and unless expressly provided
subparts A through I of 2 CFR part 180, and requires the participant to include otherwise, any reference in this part to
as that section is supplemented by the a similar term or condition in lower-tier any provision of law not in this part
section in this part with the same covered transactions. shall be understood to constitute a
section number. The contracts that are general reference and thus to include
covered transactions, for example, are PART 2701—UNIFORM any subsequent changes to the
khammond on DSK9W7S144PROD with PROPOSALS2
specified by 2 CFR 180.220 as ADMINISTRATIVE REQUIREMENTS, provision.
supplemented by § 2700.220. For any COST PRINCIPLES, AND AUDIT ■ 268. Revise part 2867 to read as
section of OMB regulation in subparts A REQUIREMENTS FOR FEDERAL follows:
through I of 2 CFR part 180 that has no AWARDS
corresponding section in this part, SBA PART 2867—NONPROCUREMENT
policies and procedures are those in the ■ 262. The authority citation for part DEBARMENT AND SUSPENSION
OMB regulation. 2701 continues to read as follows: Sec.
■ 261. Revise subparts B through D to Authority: 15 U.S.C. 634(b)(6), 2 CFR part 2867.10 What does this part do?
read as follows: 200. 2867.20 To whom does this part apply?
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Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules 32291
2867.30 What policies and procedures must (d) Department of Justice grants Subpart D—Responsibilities of Federal
be followed? officer, agreements officer, or other Agency Officials Regarding
Subpart A—General official authorized to enter into any type Transactions
2867.137 Who in the Department of Justice of nonprocurement transaction that is a
covered transaction. § 2867.437 What method must be used to
may grant an exception to let an
excluded person participate in a covered communicate to a participant the
transaction? § 2867.30 What policies and procedures requirements described in the OMB
must be followed? regulation at 2 CFR 180.435?
Subpart B—Covered Transactions
The Department of Justice policies To communicate to a participant the
2867.220 What contracts and subcontracts,
in addition to those listed in 2 CFR and procedures that must be followed requirements described in 2 CFR
180.220, are covered transactions? are the policies and procedures 180.435, the communication must
specified in each applicable section of include a term or condition in the
Subpart C—Responsibilities of Participants
the OMB regulation in subparts A transaction that requires the
Regarding Transactions
through I of 2 CFR part 180, as that participant’s compliance with subpart C
2867.332 What method must a participant of 2 CFR part 180, as supplemented by
use to pass requirements down to section is supplemented by the section
subpart C of this part, and requires the
participants at lower tiers with whom in this part with the same section
the participant intends to do business? participant to include a similar term or
number. The contracts that are covered
condition in lower-tier covered
Subpart D—Responsibilities of Federal transactions, for example, are specified
transactions.
Agency Officials Regarding Transactions by 2 CFR 180.220 as supplemented by
2867.437 What method must be used to § 2867.220. For any section of OMB Subparts E–J [Reserved]
communicate to a participant the regulation in subparts A through I of 2
requirements described in the OMB CFR part 180 that has no corresponding CHAPTER XXIX—DEPARTMENT OF LABOR
regulation at 2 CFR 180.435? section in this part, Department of
Subparts E–J [Reserved] Justice policies and procedures are PART 2900—UNIFORM
those in the OMB regulation. ADMINISTRATIVE REQUIREMENTS,
Authority: 5 U.S.C. 301; 28 U.S.C. 509, COST PRINCIPLES, AND AUDIT
510, 515–519; sec. 2455, Pub. L. 103–355, Subpart A—General REQUIREMENTS FOR FEDERAL
108 Stat. 3327 (31 U.S.C. 6101 note); E.O. AWARDS
12549, 51 FR 6370, 3 CFR, 1986 Comp., p. § 2867.137 Who in the Department of
189; E.O. 12689, 54 FR 34131, 3 CFR, 1989 Justice may grant an exception to let an ■ 269. The authority citation for part
Comp., p. 235. excluded person participate in a covered 2900 continues to read as follows:
§ 2867.10 What does this part do? transaction?
Authority: 5 U.S.C. 301; 2 CFR 200.
This part adopts the Office of Within the Department of Justice, the ■ 270. Revise § 2900.3 to read as
Management and Budget (OMB) Attorney General or designee has the follows:
regulation in subparts A through I of 2 authority to grant an exception to let an
CFR part 180, as supplemented by this excluded person participate in a § 2900.3 Questioned cost.
part, as the Department of Justice covered transaction, as provided in the
policies and procedures for In the Department of Labor, in
OMB regulation at 2 CFR 180.135.
nonprocurement debarment and addition to the regulation contained in
suspension. This part gives regulatory Subpart B—Covered Transactions 2 CFR 200.1, a questioned cost means a
effect for the Department of Justice to cost that is questioned by an auditor,
the OMB regulation for the Department § 2867.220 What contracts and Federal Project Officer, Grant Officer, or
of Justice, as supplemented by this part. subcontracts, in addition to those listed in other authorized Awarding agency
This part satisfies the requirements in 2 CFR 180.220, are covered transactions? representative because of an audit or
section 3 of Executive Order 12549, Although the OMB regulation at 2 monitoring finding:
‘‘Debarment and Suspension’’ (3 CFR, CFR 180.220(c) allows a Federal agency (a) Which resulted from a violation or
1986 Comp., p. 189), Executive Order to do so (also see optional lower tier possible violation of a statute,
12689, ‘‘Debarment and Suspension’’ (3 coverage in the figure in appendix A to regulation, or the terms and conditions
CFR, 1989 Comp., p. 235), and 31 U.S.C. 2 CFR part 180), the Department of of a Federal award, including for funds
6101 note (section 2455, Pub. L. 103– Justice does not extend coverage of used to match Federal funds;
355, 108 Stat. 3327). nonprocurement suspension and (b) Where the costs, at the time of the
§ 2867.20 To whom does this part apply? debarment requirements beyond first- audit, are not supported by adequate
This part and, through this part, tier procurement contracts under a documentation; or
pertinent portions of the OMB covered nonprocurement transaction. (c) Where the costs incurred appear
regulation in subparts A through I of 2 unreasonable and do not reflect the
CFR part 180 (see table 2 to 2 CFR Subpart C—Responsibilities of
actions a prudent person would take in
180.100(b)) apply to any— Participants Regarding Transactions
the circumstances.
(a) Participant or principal in a
khammond on DSK9W7S144PROD with PROPOSALS2
§ 2867.332 What method must a (d) Questioned costs are not an
‘‘covered transaction’’ (sees subpart B of participant use to pass requirements down improper payment until reviewed and
2 CFR part 180 and the definition of to participants at lower tiers with whom the confirmed to be improper as defined in
‘‘nonprocurement transaction’’ at 2 CFR participant intends to do business? Office of Management and Budget
180.970 (as supplemented by subpart B
A participant must include a term or (OMB) Circular A–123, Appendix C (see
of this part));
(b) Respondent in a Department of condition in lower-tier transactions also the definition of improper payment
Justice suspension or debarment action; requiring lower-tier participants to in 2 CFR 200.1).
(c) Department of Justice debarment comply with subpart C of 2 CFR part ■ 271. Revise subparts B and C to read
or suspension official; or 180, as supplemented by this subpart. as follows:
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32292 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
Subpart B—General Provisions § 2900.11 Revision of budget and program and be submitted not less than 30 days
plans including extension of the period of before the requested action is to occur.
§ 2900.4 Adoption of 2 CFR part 200. performance. Unless otherwise noted in the grant
The Department of Labor adopts the In addition to the regulation set forth agreement or cooperative agreement, the
OMB regulation ‘‘Uniform in 2 CFR 200.308(b), for Federal awards Grant Officer is the only official with
Administrative Requirements, Cost from the Department of Labor, the non- the authority to provide prior written
Principles, and Audit Requirements for Federal entity must request prior approval (prior approval). Items
Federal Awards to Non-Federal approval for an extension to the period included in the statement of work or
Entities’’ (subparts A through F of 2 CFR of performance. budget as awarded does not constitute
■ 274. Revise §§ 2900.13 through prior approval.
part 200), as supplemented by this part,
as Department of Labor policies and 2900.15 to read as follows: ■ 276. Revise § 2900.18 to read as
procedures for financial assistance § 2900.13 Intangible property. follows:
administration. This part gives In addition to the regulation set forth § 2900.18 Contingency provisions.
regulatory effect to the OMB regulation in 2 CFR 200.315(d), the Department of In addition to the regulation set forth
for Federal awards issued by the Labor requires intellectual property in 2 CFR 200.433(c), for Federal awards
Department of Labor (DOL). The DOL developed under a discretionary Federal from the Department of Labor, excepted
also has programmatic and award process to be in a format readily citations include 2 CFR 200.334
administrative regulations located in accessible and available for open (retention requirements) and 200.335
titles 20 and 29 of the CFR. See 2 CFR licensing to the public. An open license (requests for records transfers).
200.110(a) regarding the process for allows subsequent users to copy, ■ 277. Revise part 2998 to read as
amending 2 CFR part 200. distribute, transmit and adapt the follows:
copyrighted work and requires such
Subpart C—Pre-Federal Award users to attribute the work in the PART 2998—NONPROCUREMENT
Requirements and Contents of Federal manner specified by the recipient. DEBARMENT AND SUSPENSION
Awards
§ 2900.14 Financial reporting. Sec.
§ 2900.5 Federal awarding agency review 2998.10 What does this part do?
of risk posed by applicants.
In addition to the regulation set forth
in 2 CFR 200.328, for Federal awards 2998.20 Does this part apply to me?
In addition to the regulation set forth from the Department of Labor, the DOL 2998.30 What policies and procedures must
in 2 CFR 200.206(b), in evaluating risks I follow?
awarding agency will prescribe whether
of applicants, DOL also considers audits the report will be on a cash or an Subpart A—General
and monitoring reports containing accrual basis. If the DOL awarding 2998.137 Who in DOL may grant an
findings and issues of noncompliance or agency requires reporting on an accrual exception to let an excluded person
questioned costs, in addition to reports basis and the recipient’s accounting participate in a covered transaction?
and findings from audits performed system is not on the accrual basis, the Subpart B—Covered Transactions
under subpart F of 2 CFR part 200 or the recipient will not be required to convert
reports and findings of any other 2998.220 What contracts and subcontracts,
its accounting system, but must develop
available audits (see 2 CFR 200.206(b)). in addition to those listed in 2 CFR
and report such accrual information 180.220, are covered transactions?
■ 272. Revise §§ 2900.7 and 2900.8 to through best estimates based on an
read as follows: analysis of the documentation on hand. Subpart C—Responsibilities of Participants
Regarding Transactions
§ 2900.7 Federal payment. § 2900.15 Closeout. 2998.332 What requirements must I pass
In addition to the regulation set forth In addition to the regulation set forth down to persons at lower tiers with
in 2 CFR 200.305(b), for Federal awards in 2 CFR 200.344(b), for Federal awards whom I intend to do business?
from the Department of Labor, the non- from the Department of Labor, the non- Subpart D—Responsibilities of Federal
Federal entity should liquidate existing Federal entity must liquidate all Agency Officials Regarding Transactions
advances before it requests additional financial obligations and/or accrued
2998.437 What method do I use to
advances. expenditures incurred under the Federal communicate to a participant the
award. For non-Federal entities requirements described in the OMB
§ 2900.8 Cost sharing or matching. reporting on an accrual basis and regulation at 2 CFR 180.435?
In addition to the regulation set forth operating on an expenditure period,
Subparts E–J [Reserved]
in 2 CFR 200.306(b), for Federal awards unless otherwise noted in the grant
from the Department of Labor, the non- agreement or cooperative agreement, the Authority: 5 U.S.C. 301; sec. 2455, Pub. L.
Federal entity accounts for funds used only liquidation that can occur during 103–355, 108 Stat. 3327 (31 U.S.C. 6101
for cost sharing or match within their closeout is the liquidation of accrued note); E.O. 12549, 51 FR 6370, 3 CFR, 1986
expenditures (NOT financial Comp., p.189; E.O. 12689, 54 FR 34131, 3
accounting systems as the funds are
obligations) for goods and/or services CFR, 1989 Comp., p.235.
expended.
received during the grant period. § 2998.10 What does this part do?
■ 273. Revise §§ 2900.10 and 2900.11 to
■ 275. Revise § 2900.16 to read as
read as follows: follows: This part adopts the Office of
khammond on DSK9W7S144PROD with PROPOSALS2
Management and Budget (OMB)
§ 2900.10 Prior approval requests. § 2900.16 Prior written approval (prior regulation in subparts A through I of 2
In addition to the regulation set forth approval). CFR part 180, as supplemented by this
in 2 CFR 200.308(c), for Federal awards In addition to the regulation set forth part, as the Department of Labor (DOL)
from the Department of Labor, the non- in 2 CFR 200.407, for Federal awards policies and procedures for non-
Federal entity must request prior from the Department of Labor, the non- procurement debarment and
approval actions at least 30 days prior Federal entity must request prior suspension. This part gives regulatory
to the effective date of the requested written approval which should include effect to the OMB regulation for Federal
action (see 2 CFR 200.407). the timeframe or scope of the agreement awards issued by DOL as supplemented
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Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules 32293
by this part. This part satisfies the Subpart B—Covered Transactions Subpart A—General
requirements in section 3 of Executive 3000.137 Who in the Department of
Order 12549, ‘‘Debarment and § 2998.220 What contracts and Homeland Security may grant an
subcontracts, in addition to those listed in exception to let an excluded person
Suspension’’ (3 CFR, 1986 Comp., p.
2 CFR 180.220, are covered transactions? participate in a covered transaction?
189); Executive Order 12689,
‘‘Debarment and Suspension’’ (3 CFR, In addition to the contracts covered
under 2 CFR 180.220(b), this part Subpart B—Covered Transactions
1989 Comp., p. 235); and section 2455 3000.220 What contracts and subcontracts,
of the Federal Acquisition Streamlining applies to any contract, regardless of
tier, that is awarded by a contractor, in addition to those listed in 2 CFR
Act of 1994, 103 (31 U.S.C. 6101 note). 180.220, are covered transactions?
subcontractor, supplier, consultant, or
§ 2998.20 Does this part apply to me? its agent or representative in any Subpart C—Responsibilities of Participants
This part and, through this part, transaction, if the contract is to be Regarding Transactions
pertinent portions of the OMB funded or provided by the Department 3000.332 What methods must I use to pass
regulation in subparts A through I of 2 of Labor under a covered non- requirements down to participants at
CFR part 180 (see table 2 to 2 CFR procurement transaction. This extends lower tiers with whom I intend to do
the coverage of the Department of Labor business?
180.100(b)) apply to you if you are a—
(a) Participant or principal in a non-procurement suspension and Subpart D—Responsibilities of Department
‘‘covered transaction’’ (see subpart B of debarment requirements to all lower of Homeland Security Officials Regarding
2 CFR part 180 and the definition of tiers of subcontracts under covered non- Transactions
‘‘non-procurement transaction’’ at 2 CFR procurement transactions, as permitted 3000.437 What method do I use to
180.970); under the OMB regulation at 2 CFR communicate to a participant the
(b) Respondent in a Department of 180.220(c) (see optional lower tier requirements described in the Office of
Labor suspension or debarment action; coverage in the figure in appendix A to Management and Budget regulation at 2
2 CFR part 180). CFR 180.435?
(c) Department of Labor debarment or
suspension official; or Subparts E–I [Reserved]
Subpart C—Responsibilities of
(d) Department of Labor grants officer, Participants Regarding Transactions Authority: Sec. 2455, Pub. L. 103–355, 108
agreements officer, or other official Stat. 3327 (31 U.S.C. 6101 note); 6 U.S.C. 101
authorized to enter into any type of non- § 2998.332 What requirements must I pass et seq.; E.O. 12549, 51 FR 6370, 3 CFR, 1986
procurement transaction that is a down to persons at lower tiers with whom Comp., p. 189; E.O. 12689, 54 FR 34131, 3
covered transaction. I intend to do business? CFR, 1989 Comp., p. 235.
You, as a participant, must include a
§ 2998.30 What policies and procedures term or condition in lower-tier § 3000.10 What does this part do?
must I follow? transactions requiring lower-tier This part adopts the Office of
(a) The Department of Labor’s policies participants to comply with subpart C of Management and Budget (OMB)
and procedures that you must follow are 2 CFR part 180, as supplemented by this regulation in subparts A through I of 2
specified in: subpart. CFR part 180, as supplemented by this
(1) Each applicable section of the part, as the Department of Homeland
OMB regulation in subparts A through Subpart D—Responsibilities of Federal Security policies and procedures for
I of 2 CFR part 180; and Agency Officials Regarding nonprocurement debarment and
(2) The supplement to each section of Transactions suspension. This part gives regulatory
the OMB regulation that is found in this § 2998.437 What method do I use to effect to the OMB regulation for the
part under the same section number. communicate to a participant the Department of Homeland Security as
(The contracts that are covered requirements described in the OMB supplemented by this part. This part
transactions, for example, are specified regulation at 2 CFR 180.435? satisfies the requirements in section 3 of
by 2 CFR 180.220 as supplemented by To communicate to a participant the Executive Order 12549, ‘‘Debarment and
§ 2998.220.) requirements described in 2 CFR Suspension’’ (3 CFR, 1986 Comp., p.
(b) For any section of OMB regulation 180.435, you must include a term or 189), Executive Order 12689,
in subparts A through I of 2 CFR part condition in the transaction that ‘‘Debarment and Suspension’’ (3 CFR,
180 that has no corresponding section in requires the participant’s compliance 1989 Comp., p. 235), and 31 U.S.C. 6101
this part, the Department of Labor’s with subpart C of 2 CFR part 180, and note (section 2455, Pub. L. 103–355, 108
policies and procedures are those in the supplemented by subpart C of this part, Stat. 3327).
OMB regulation. and requires the participant to include
§ 3000.20 Does this part apply to me?
a similar term or condition in lower-tier
Subpart A—General covered transactions. This part and, through this part,
§ 2998.137 Who in DOL may grant an pertinent portions of the OMB
exception to let an excluded person Subparts E–J [Reserved] regulation in subparts A through I of 2
participate in a covered transaction? CFR part 180 (see table 2 to 2 CFR
CHAPTER XXX—DEPARTMENT OF
Within the Department of Labor, the HOMELAND SECURITY 180.100(b)) apply to you if you are a—
Secretary of Labor or designee has the ■ 278. Revise and republish part 3000 to
(a) Participant or principal in a
khammond on DSK9W7S144PROD with PROPOSALS2
authority to grant an exception to let an read as follows: ‘‘covered transaction’’ (see subpart B of
excluded person participate in a 2 CFR part 180 and the definition of
covered transaction, as provided in the PART 3000—NONPROCUREMENT ‘‘nonprocurement transaction’’ at 2 CFR
OMB regulation at 2 CFR 180.135. If any DEBARMENT AND SUSPENSION 180.970);
designated official grants an exception, (b) Respondent in a Department of
Sec. Homeland Security suspension or
the exception must be in writing and 3000.10 What does this part do?
state the reason(s) for deviating from the 3000.20 Does this part apply to me? debarment action;
Government-wide policy in Executive 3000.30 What policies and procedures must (c) Department of Homeland Security
Order 12549. I follow? debarment or suspension official; or
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32294 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
(d) Department of Homeland Security under a covered nonprocurement § 3001.10 What does this part do?
grants officer, agreements officer, or transaction. This part requires that the award and
other official authorized to enter into administration of Department of
any type of nonprocurement transaction Subpart C—Responsibilities of Homeland Security (DHS) grants and
that is a covered transaction. Participants Regarding Transactions cooperative agreements comply with
§ 3000.30 What policies and procedures § 3000.332 What methods must I use to Office of Management and Budget
must I follow? pass requirements down to participants at (OMB) regulation implementing the
lower tiers with whom I intend to do portion of the Drug-Free Workplace Act
The Department of Homeland business? of 1988 (41 U.S.C. 701–707, as
Security policies and procedures that You as a participant in a covered amended, hereinafter referred to as ‘‘the
you must follow are the policies and transaction must include a term or Act’’) that applies to grants. This part—
procedures specified in each applicable condition in any lower-tier covered (a) Adopts the OMB regulation
section of the OMB regulation in transaction into which you enter, to (subparts A through F of 2 CFR part
subparts A through I of 2 CFR part 180, require the participant of that 182), as supplemented by this part, for
as that section is supplemented by the transaction to— DHS’s grants and cooperative
section in this part with the same (a) Comply with subpart C of 2 CFR agreements; and
section number. The contracts that are part 180; and (b) Establishes DHS policies and
covered transactions, for example, are (b) Include a similar term or condition
procedures, as supplemented by this
specified by 2 CFR 180.220) as in any covered transaction into which it
part, for compliance with the Act that
supplemented by § 3000.220. For any enters at the next lower tier.
are the same as those of other Federal
section of OMB regulation in subparts A agencies, in conformance with the
through I of 2 CFR part 180 that has no Subpart D—Responsibilities of
Department of Homeland Security requirement in 41 U.S.C. 705 for
corresponding section in this part, Government-wide implementing
Department of Homeland Security Officials Regarding Transactions
regulations.
policies and procedures are those in the § 3000.437 What method do I use to
OMB regulation. communicate to a participant the § 3001.20 Does this part apply to me?
requirements described in the Office of This part and, through this part,
Subpart A—General Management and Budget regulation at 2 pertinent portions of the OMB
CFR 180.435?
§ 3000.137 Who in the Department of regulation in subparts A through F of 2
Homeland Security may grant an exception You as a DHS component official CFR part 182 (see 2 CFR 182.115(b))
to let an excluded person participate in a must include a term or condition in apply to you if you are a—
covered transaction? each covered transaction into which you (a) Recipient of a DHS grant or
enter, to communicate to the participant cooperative agreement; or
Within the Department of Homeland the requirements to—
Security (DHS), the Secretary of (a) Comply with subpart C of 2 CFR (b) DHS awarding official.
Homeland Security has delegated the part 180; and § 3001.30 What policies and procedures
authority to grant an exception to let an (b) Include a similar term or condition must I follow?
excluded person participate in a in any lower-tier covered transactions
covered transaction to the Chief (a) General. You must follow the
into which the participant enters.
Financial Officer for each DHS policies and procedures specified in
component as provided in the OMB Subparts E–I [Reserved] applicable sections of the OMB
regulation at 2 CFR 180.135. regulation in subparts A through F of 2
PART 3001—REQUIREMENTS FOR CFR part 182, as implemented by this
Subpart B—Covered Transactions DRUG-FREE WORKPLACE part.
(FINANCIAL ASSISTANCE) (b) Specific sections of OMB
§ 3000.220 What contracts and regulation that this part supplements.
subcontracts, in addition to those listed in ■ 279. The authority citation for part
This part supplements the OMB
2 CFR 180.220, are covered transactions? 3001 is revised to read as follows:
regulation in 2 CFR part 182 as shown
Department of Homeland Security Authority: 5 U.S.C. 301; 41 U.S.C. 701– in the following table. For each of those
extends coverage of nonprocurement 707; 6 U.S.C. 101 et seq.; 2 CFR part 182. sections, you must follow the policies
suspension and debarment requirements ■ 280. Revise §§ 3001.10 through and procedures in the OMB regulation,
beyond first-tier procurement contracts 3001.30 to read as follows: as supplemented by this part.
Section in this
Section of OMB part where What the supplementation clarifies
regulation supplemented
(1) 2 CFR 182.225(a) .................. § 3001.225 ........ Who in DHS a recipient other than an individual must notify if an employee is convicted
for a violation of a criminal drug statute in the workplace.
(2) 2 CFR 182.300(b) .................. § 3001.300 ........ Who in DHS a recipient who is an individual must notify if he or she is convicted of a
criminal drug offense resulting from a violation occurring during the conduct of any
khammond on DSK9W7S144PROD with PROPOSALS2
award activity.
(3) 2 CFR 182.400 ...................... § 3001.400 ........ What method do I use as an agency awarding official to obtain a recipient’s agreement to
comply with the OMB regulation.
(4) 2 CFR 182.500 ...................... § 3001.500 ........ Who in DHS is authorized to determine that a recipient other than an individual is in viola-
tion of the requirements of 2 CFR part 182, as implemented by this part.
(5) 2 CFR 182.505 ...................... § 3001.505 ........ Who in DHS is authorized to determine that a recipient who is an individual is in violation
of the requirements of 2 CFR part 182, as implemented by this part.
(6) 2 CFR 182.510 ...................... § 3001.510 ........ What actions the Federal Government will take against a recipient determined to have vio-
lated 2 CFR part 182, as implemented by this part.
(7) 2 CFR 182.605 ...................... § 3001.605 ........ What types of assistance are included in the definition of ‘‘award.’’
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Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules 32295
Section in this
Section of OMB part where What the supplementation clarifies
regulation supplemented
(8) None ...................................... § 3001.661 ........ What types of assistance are included in the definition of ‘‘reimbursable agreement.’’
(c) Sections of the OMB regulation 3185.10 What does this part do? ‘‘nonprocurement transaction’’ at 2 CFR
that this part does not supplement. For 3185.20 Does this part apply to me? 180.970).
any section of OMB regulation in 3185.30 What policies and procedures must
I follow? (b) Respondent in an IMLS
subparts A through F of 2 CFR part 182 suspension or debarment action.
that is not listed in paragraph (b) of this Subpart A—General
section, DHS policies and procedures 3185.137 Who in the IMLS may grant an (c) IMLS debarment or suspension
are the same as those in the OMB exception to let an excluded person official.
regulation. participate in a covered transaction? (d) IMLS grants officer, agreements
■ 281. Revise § 3001.400 to read as officer, or other official authorized to
Subpart B—Covered Transactions
follows: enter into any type of nonprocurement
3185.220 What contracts and subcontracts,
§ 3001.400 What method do I use as an in addition to those listed in 2 CFR transaction that is a covered transaction.
agency awarding official to obtain a 180.220, are covered transactions?
recipient’s agreement to comply with the § 3185.30 What policies and procedures
Subpart C—Responsibilities of Participants must I follow?
OMB regulation? Regarding Transactions
To obtain a recipient’s agreement to The IMLS policies and procedures
3185.332 What methods must I use to pass
comply with applicable requirements in requirements down to participants at that you must follow are the policies
the OMB regulation at 2 CFR part 182, lower tiers with whom I intend to do and procedures specified in each
you must include the following term or business? applicable section of the OMB
condition in the award: regulation in subparts A through I of 2
Subpart D—Responsibilities of Federal
Drug-free workplace. You as the CFR part 180, as that section is
Agency Officials Regarding Transactions
recipient must comply with drug-free supplemented by the section in this part
workplace requirements in subpart B (or 3185.437 What method do I use to
communicate to a participant the with the same section number. The
subpart C, if the recipient is an
requirements described in the OMB contracts that are covered transactions,
individual) of 2 CFR part 3001, which regulation at 2 CFR 180.435?
adopts the Government-wide for example, are specified by 2 CFR
implementation (2 CFR part 182) of sec. Subparts E–I [Reserved] 180.220 as supplemented by § 3185.220.
5152–5158 of the Drug-Free Workplace For any section of OMB regulation in
Authority: 20 U.S.C. 9103(f); sec. 2455, subparts A through I of 2 CFR part 180
Act of 1988 (Pub. L. 100–690, Title V, Pub. L. 103–355, 108 Stat. 3327 (31 U.S.C.
Subtitle D; 41 U.S.C. 701–707). 6101 note); E.O. 12549, 51 FR 6370, 3 CFR, that has no corresponding section in
1986 Comp., p. 189; E.O. 12689, 54 FR 34131, this part, IMLS policies and procedures
PART 3002—UNIFORM 3 CFR, 1989 Comp., p. 235. are those in the OMB regulation.
ADMINISTRATIVE REQUIREMENTS,
COST PRINCIPLES, AND AUDIT § 3185.10 What does this part do? Subpart A—General
REQUIREMENTS FOR FEDERAL This part adopts the Office of
Management and Budget (OMB) § 3185.137 Who in the IMLS may grant an
AWARDS
regulation in subparts A through I of 2 exception to let an excluded person
■ 282. The authority citation for part CFR part 180, as supplemented by this participate in a covered transaction?
3002 is revised to read as follows: part, as the Institute of Museum and The IMLS Director has the authority
Authority: 31 U.S.C. 503; 6 U.S.C. 101 et Library Services (IMLS) policies and to grant an exception to let an excluded
seq.; 2 CFR part 200. procedures for nonprocurement person participate in a covered
■ 283. Revise § 3002.10 to read as debarment and suspension. This part transaction, as provided in the OMB
follows: gives regulatory effect for IMLS to the regulation at 2 CFR 180.135.
OMB regulation for Federal awards
§ 3002.10 Adoption of 2 CFR part 200. issued by IMLS as supplemented by this Subpart B—Covered Transactions
The Department of Homeland part. This part satisfies the requirements
Security adopts the Office of in section 3 of Executive Order 12549, § 3185.220 What contracts and
Management and Budget (OMB) ‘‘Debarment and Suspension’’ (3 CFR, subcontracts, in addition to those listed in
regulation in 2 CFR part 200. This part 1986 Comp., p. 189), Executive Order 2 CFR 180.220, are covered transactions?
gives regulatory effect to the OMB 12689, ‘‘Debarment and Suspension’’ (3 Although the OMB regulation at 2
regulation for Federal awards issued by CFR, 1989 Comp., p. 235), and 31 U.S.C. CFR 180.220(c) allows a Federal agency
the Department of Homeland Security. 6101 note (section 2455, Pub. L. 103– to do so (also see optional lower-tier
See 2 CFR 200.110(a) regarding the 355, 108 Stat. 3327). coverage in the figure in appendix A to
process for amending 2 CFR part 200.
khammond on DSK9W7S144PROD with PROPOSALS2
§ 3185.20 Does this part apply to me? 2 CFR part 180), IMLS does not extend
CHAPTER XXXI—INSTITUTE OF MUSEUM coverage of nonprocurement suspension
AND LIBRARY SERVICES
This part and, through this part,
pertinent portions of the OMB and debarment requirements beyond
■ 284. Revise part 3185 to read as first-tier procurement contracts under a
regulation in subparts A through I of 2
follows: CFR part 180 (see table 2 to 2 CFR covered nonprocurement transaction.
PART 3185—NONPROCUREMENT 180.100(b)) apply to you if you are a—
DEBARMENT AND SUSPENSION (a) Participant or principal in a
‘‘covered transaction’’ (see subpart B of
Sec. 2 CFR part 180 and the definition of
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32296 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
Subpart C—Responsibilities of Subparts E–I [Reserved] the requirement in 41 U.S.C. 705 for
Participants Regarding Transactions Governmentwide implementing
PART 3186—REQUIREMENTS FOR regulations.
§ 3185.332 What methods must I use to DRUG-FREE WORKPLACE
pass requirements down to participants at (FINANCIAL ASSISTANCE) § 3186.20 Does this part apply to me?
lower tiers with whom I intend to do This part and, through this part,
business? ■ 285. The authority citation for part
pertinent portions of the OMB
3186 continues to read as follows: regulation in subparts A through F of 2
You as a participant must include a
term or condition in lower-tier Authority: 41 U.S.C. 701–707. CFR part 182 (see 2 CFR 182.115(b))
transactions requiring lower-tier ■ 286. Revise §§ 3186.10 through apply to you if you are a—
participants to comply with subpart C of 3186.30 to read as follows: (a) Recipient of an IMLS grant or
2 CFR part 180, as supplemented by this cooperative agreement; or
subpart. § 3186.10 What does this part do? (b) IMLS awarding official.
This part requires that the award and
Subpart D—Responsibilities of Federal administration of Institute of Museum § 3186.30 What policies and procedures
Agency Officials Regarding and Library Services (IMLS) grants and must I follow?
Transactions cooperative agreements comply with (a) General. You must follow the
Office of Management and Budget policies and procedures specified in
§ 3185.437 What method do I use to (OMB) regulation implementing the applicable sections of the OMB
communicate to a participant the regulation in subparts A through F of 2
requirements described in the OMB
portion of the Drug-Free Workplace Act
of 1988 (41 U.S.C. 701–707, as CFR part 182, as implemented by this
regulation at 2 CFR 180.435?
amended, hereinafter referred to as ‘‘the part.
To communicate to a participant the Act’’) that applies to grants. This part— (b) Specific sections of OMB
requirements described in 2 CFR (a) Gives regulatory effect to the OMB regulation that this part supplements. In
180.435, you must include a term or regulation (subparts A through F of 2 implementing the OMB regulation in 2
condition in the transaction that CFR part 182) for Federal awards issued CFR part 182, this part supplements
requires the participant’s compliance by IMLS for the IMLS’s grants and four sections of the OMB regulation, as
with subpart C of 2 CFR part 180, as cooperative agreements; and shown in the following table. For each
supplemented by subpart C of this part, (b) Establishes IMLS policies and of those sections, you must follow the
and requires the participant to include procedures for compliance with the Act policies and procedures in the OMB
a similar term or condition in lower-tier that are the same as those of other regulation, as supplemented by this
covered transactions. Federal agencies, in conformance with part.
Section in this
Section of OMB part where What the supplementation clarifies
regulation supplemented
(1) 2 CFR 182.225(a) .................. § 3186.225 ........ Whom in the IMLS a recipient other than an individual must notify if an employee is con-
victed for a violation of a criminal drug statute in the workplace.
(2) 2 CFR 182.300(b) .................. § 3186.300 ........ Whom in the IMLS a recipient who is an individual must notify if he or she is convicted of
a criminal drug offense resulting from a violation occurring during the conduct of any
award activity.
(3) 2 CFR 182.500 ...................... § 3186.500 ........ Who in the IMLS is authorized to determine that a recipient other than an individual is in
violation of the requirements of 2 CFR part 182, as implemented by this part.
(4) 2 CFR 182.505 ...................... § 3186.505 ........ Who in the IMLS is authorized to determine that a recipient who is an individual is in vio-
lation of the requirements of 2 CFR part 182, as implemented by this part.
(c) Sections of the OMB regulation workplace requirements in Subpart B § 3187.1 Adoption of 2 CFR part 200.
that this part does not supplement. For (or Subpart C, if the recipient is an The Institute of Museum and Library
any section of OMB regulation in individual) of 2 CFR part 3186, which Services (IMLS) adopts the Office of
subparts A through F of 2 CFR part 182 adopts the Governmentwide Management and Budget (OMB)
that is not listed in paragraph (b) of this implementation (2 CFR part 182) of sec. regulation in 2 CFR part 200, with the
section, IMLS policies and procedures 5152–5158 of the Drug-Free Workplace additions that are provided in this part.
are the same as those in the OMB Act of 1988 (Pub. L. 100–690, Title V, This part gives regulatory effect to the
regulation. Subtitle D; 41 U.S.C. 701–707). OMB regulations and supplements the
■ 287. Revise § 3186.400 to read as regulations as needed for IMLS. See 2
follows: PART 3187—UNIFORM CFR 200.110(a) regarding the process for
ADMINISTRATIVE REQUIREMENTS, amending 2 CFR part 200.
§ 3186.400 What method do I use as an COST PRINCIPLES, AND AUDIT
agency awarding official to obtain a CHAPTER XXXII—NATIONAL ENDOWMENT
REQUIREMENTS FOR FEDERAL FOR THE ARTS
khammond on DSK9W7S144PROD with PROPOSALS2
recipient’s agreement to comply with the AWARDS
OMB regulation? ■ 290. Revise part 3254 to read as
To obtain a recipient’s agreement to ■ 288. The authority citation for part
follows:
comply with applicable requirements in 3187 continues to read as follows: PART 3254—NONPROCUREMENT
the OMB regulation at 2 CFR part 182, Authority: 20 U.S.C. 9101–9176, 9103(h); DEBARMENT AND SUSPENSION
you must include the following term or 20 U.S.C. 80r–5; 2 CFR part 200.
condition in the award: Sec.
Drug-free workplace. You as the ■ 289. Revise § 3187.1 to read as 3254.10 What does this part do?
recipient must comply with drug-free follows: 3254.20 Does this part apply to me?
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Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules 32297
3254.30 What policies and procedures must enter into any type of nonprocurement 180.435, you must include a term or
I follow? transaction that is a covered transaction. condition in the transaction that
Subpart A—General requires the participant’s compliance
§ 3254.30 What policies and procedures
3254.137 Who in the NEA may grant an
with subpart C of 2 CFR part 180, as
must I follow?
exception to let an excluded person supplemented by subpart C of this part,
The NEA policies and procedures that and requires the participant to include
participate in a covered transaction? you must follow are the policies and a similar term or condition in lower-tier
Subpart B—Covered Transactions procedures specified in each applicable covered transactions.
3254.220 What contracts and subcontracts, section of the OMB regulation in
in addition to those listed in 2 CFR subparts A through I of 2 CFR part 180, Subparts E–I [Reserved]
180.220, are covered transactions? as that section is supplemented by the
section in this part with the same ■ 291. Revise part 3255 to read as
Subpart C—Responsibilities of Participants
section number. The contracts that are follows:
Regarding Transactions
covered transactions, for example, are
3254.332 What methods must I use to pass specified by 2 CFR 180.220 as PART 3255—UNIFORM
requirements down to participants at ADMINISTRATIVE REQUIREMENTS,
lower tiers with whom I intend to do
supplemented by § 3254.220. For any
section of OMB regulation in subparts A COST PRINCIPLES, AND AUDIT
business?
through I of 2 CFR part 180 that has no REQUIREMENTS FOR FEDERAL
Subpart D—Responsibilities of Federal corresponding section in this part, NEA AWARDS
Agency Officials Regarding Transactions policies and procedures are those in the Sec.
3254.437 What method do I use to OMB regulation. 3255.1 Adoption of 2 CFR part 200.
communicate to a participant the
3255.2 [Reserved]
requirements described in the OMB Subpart A—General
regulation at 2 CFR 180.435? Authority: 5 U.S.C. 301; 20 U.S.C. 954; 2
§ 3254.137 Who in the NEA may grant an CFR part 200.
Subparts E–I [Reserved] exception to let an excluded person
participate in a covered transaction? § 3255.1 Adoption of 2 CFR part 200.
Authority: Sec. 2455, Pub. L. 103–355, 108
Stat. 3327 (31 U.S.C. 6101 note); E.O. 12549, The NEA Chairman has the authority The National Endowment for the Arts
51 FR 6370, 3 CFR, 1986 Comp., p. 189; E.O. to grant an exception to let an excluded (NEA) adopts the Office of Management
12689, 54 FR 34131, 3 CFR, 1989 Comp., p. person participate in a covered and Budget (OMB) regulation in 2 CFR
235. transaction, as provided in the OMB part 200. This part gives regulatory
regulation at 2 CFR 180.135. effect to the OMB regulation for Federal
§ 3254.10 What does this part do?
awards issued by the NEA. See 2 CFR
This part adopts the Office of Subpart B—Covered Transactions 200.110(a) regarding the process for
Management and Budget (OMB) amending 2 CFR part 200.
regulation in subparts A through I of 2 § 3254.220 What contracts and
subcontracts, in addition to those listed in § 3255.2 [Reserved]
CFR part 180, as supplemented by this 2 CFR 180.220, are covered transactions?
part, as the National Endowment for the
Although the OMB regulation at 2 PART 3256—REQUIREMENTS FOR
Arts (NEA) policies and procedures for
CFR 180.220(c) allows a Federal agency DRUG-FREE WORKPLACE
nonprocurement debarment and
to do so (also see options lower tier (FINANCIAL ASSISTANCE)
suspension. This part gives regulatory
coverage in the figure in appendix A to
effect to the OMB regulation for Federal ■ 292. The authority citation for part
2 CFR part 180), NEA does not extend
awards issued by the Department as 3256 is revised to read as follows:
coverage of nonprocurement suspension
supplemented by this part. This part
and debarment requirements beyond Authority: 41 U.S.C. 8101 et seq.
satisfies the requirements in section 3 of first-tier procurement contracts under a
Executive Order 12549, ‘‘Debarment and ■ 293. Revise §§ 3256.100 through
covered nonprocurement transaction.
Suspension’’ (3 CFR, 1986 Comp., p. 3256.110 to read as follows:
189), Executive Order 12689, Subpart C—Responsibilities of § 3256.100 What does this part do?
‘‘Debarment and Suspension’’ (3 CFR, Participants Regarding Transactions
1989 Comp., p. 235), and 31 U.S.C. 6101 This part requires that the award and
note (section 2455, Pub. L. 103–355, 108 § 3254.332 What methods must I use to administration of National Endowment
Stat. 3327). pass requirements down to participants at for the Arts (NEA) grants and
lower tiers with whom I intend to do cooperative agreements comply with
§ 3254.20 Does this part apply to me? business? Office of Management and Budget
This part and, through this part, You as a participant must include a (OMB) regulation implementing the
pertinent portions of the OMB term or condition in lower-tier portion of the Drug-Free Workplace Act
regulation in subparts A through I of 2 transactions requiring lower-tier of 1988 (41 U.S.C. 8101–8106, as
CFR part 180 (see table 2 to 2 CFR participants to comply with subpart C of amended, hereinafter referred to as ‘‘the
180.100(b)) apply to you if you are a— 2 CFR part 180, as supplemented by this Act’’) that applies to grants. This part—
(a) Participant or principal in a subpart. (a) Gives regulatory effect to the OMB
‘‘covered transaction’’ (see subpart B of regulation (subparts A through F of 2
Subpart D—Responsibilities of Federal
khammond on DSK9W7S144PROD with PROPOSALS2
2 CFR part 180 and the definition of CFR part 182) for the NEA’s grants and
‘‘nonprocurement transaction’’ at 2 CFR Agency Officials Regarding cooperative agreements; and
180.970). Transactions (b) Establishes NEA policies and
(b) Respondent in a NEA suspension § 3254.437 What method do I use to procedures for compliance with the Act
or debarment action. communicate to a participant the that are the same as those of other
(c) NEA debarment or suspension requirements described in the OMB Federal agencies, in conformance with
official. regulation at 2 CFR 180.435? the requirement in 41 U.S.C. 8106 for
(d) NEA grants officer, agreements To communicate to a participant the Governmentwide implementing
officer, or other official authorized to requirements described in 2 CFR regulations.
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32298 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
§ 3256.105 Does this part apply to me? § 3256.110 What policies and procedures implementing the regulation in 2 CFR
must I follow? part 182, this part supplements four
This part and, through this part,
pertinent portions of the OMB (a) General. You must follow the sections of the OMB regulation, as
regulation in subparts A through F of 2 policies and procedures specified in the shown in the following table. For each
CFR part 182 (see 2 CFR 182.115(b)) applicable sections of the OMB of those sections, you must follow the
apply to you if you are a— regulation in subparts A through F of 2 policies and procedures in the OMB
CFR part 182, as implemented by this regulation, as supplemented by this
(a) Recipient of an NEA grant or part.
cooperative agreement; or part.
(b) Specific sections of OMB
(b) NEA awarding official. regulation that this part supplements. In
Section in this
Section of OMB regula- part where What the supplementation clarifies
tion supplemented
(1) 2 CFR 182.225(a) ..... § 3256.200 ........ Whom in the NEA a recipient other than an individual must notify if an employee is convicted for
a violation of a criminal drug statute in the workplace.
(2) 2 CFR 182.300(b) ..... § 3256.300 ........ Whom in the NEA a recipient who is an individual must notify if he or she is convicted of a crimi-
nal drug offense resulting from a violation occurring during the conduct of any award activity.
(3) 2 CFR 182.500 ......... § 3256.500 ........ Who in the NEA is authorized to determine that a recipient other than an individual is in violation
of the requirements of 2 CFR part 182, as implemented by this part.
(4) 2 CFR 182.505 ......... § 3256.505 ........ Who in the NEA is authorized to determine that a recipient who is an individual is in violation of
the requirements of 2 CFR part 182, as implemented by this part.
(c) Sections of the OMB regulation Subpart A—General CFR, 1989 Comp., p. 235), and 31 U.S.C.
that this part does not supplement. For 3369.137 Who in the NEH may grant an 6101 note (section 2455, Pub. L. 103–
any section of OMB regulation in exception to let an excluded person 355, 108 Stat. 3327).
subparts A through F of 2 CFR part 182 participate in a covered transaction?
that is not listed in paragraph (b) of this § 3369.20 Does this part apply to me?
Subpart B—Covered Transactions
section, the NEA’s policies and 3369.220 What contracts and subcontracts, This part and, through this part,
procedures are the same as those in the in addition to those listed in 2 CFR pertinent portions of the OMB
OMB regulation. 180.220, are covered transactions? regulation in subparts A through I of 2
■ 294. Revise § 3256.400 to read as Subpart C—Responsibilities of Participants CFR part 180 (see table 2 to 2 CFR
follows: Regarding Transactions 180.100(b)) apply to you if you are a—
3369.332 What methods must I use to pass (a) Participant or principal in a
§ 3256.400 What method do I use as an requirements down to participants at
agency awarding official to obtain a
‘‘covered transaction’’ (see subpart B of
lower tiers with whom I intend to do
recipient’s agreement to comply with the 2 CFR part 180 and the definition of
business?
OMB regulation? ‘‘nonprocurement transaction’’ at 2 CFR
Subpart D—Responsibilities of Federal 180.970).
To obtain a recipient’s agreement to Agency Officials Regarding Transactions
comply with applicable requirements in (b) Respondent in a NEH suspension
3369.437 What method do I use to
the OMB regulation at 2 CFR part 182, communicate to a participant the or debarment action.
you must include the following term or requirements described in the OMB (c) NEH debarment or suspension
condition in the award: regulation at 2 CFR 180.435? official.
Drug-free workplace. You as the Subparts E–I [Reserved] (d) NEH grants officer, agreements
recipient must comply with drug-free Authority: 20 U.S.C. 959(a)(1); Sec. 2455,
officer, or other official authorized to
workplace requirements in subpart B (or Pub. L. 103–355, 108 Stat. 3327 (31 U.S.C. enter into any type of nonprocurement
subpart C, if the recipient is an 6101 note); E.O. 12549, 51 FR 6370, 3 CFR, transaction that is a covered transaction.
individual) of this part, which adopts 1986 Comp., p. 189; E.O. 12689, 54 FR 34131,
the Governmentwide implementation (2 3 CFR, 1989 Comp., p. 235. § 3369.30 What policies and procedures
must I follow?
CFR part 182) of sec. 5152–5158 of the § 3369.10 What does this part do?
Drug-Free Workplace Act of 1988 (Pub. The NEH policies and procedures that
This part adopts the Office of
L. 100–690, Title V, Subtitle D; 41 you must follow are the policies and
Management and Budget (OMB)
U.S.C. 8101–8106). regulation in subparts A through I of 2 procedures specified in each applicable
CHAPTER XXXIII—NATIONAL CFR part 180, as supplemented by this section of the OMB regulation in
ENDOWMENT FOR THE HUMANITIES part, as the National Endowment for the subparts A through I of 2 CFR part 180,
Humanities (NEH) policies and as that section is supplemented by the
■ 295. Revise part 3369 to read as section in this part with the same
procedures for nonprocurement
follows:
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debarment and suspension. This part section number. The contracts that are
gives regulatory effect for Federal covered transactions, for example, are
PART 3369—NONPROCUREMENT specified by 2 CFR 180.220 as
DEBARMENT AND SUSPENSION awards issued by the NEH to the OMB
regulation as supplemented by this part. supplemented by § 3369.220. For any
Sec. This part satisfies the requirements in section of OMB regulation in subparts A
3369.10 What does this part do? section 3 of Executive Order 12549, through I of 2 CFR part 180 that has no
3369.20 Does this part apply to me? ‘‘Debarment and Suspension’’ (3 CFR, corresponding section in this part, NEH
3369.30 What policies and procedures must 1986 Comp., p. 189), Executive Order policies and procedures are those in the
I follow? 12689, ‘‘Debarment and Suspension’’ (3 OMB regulation.
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Subpart A—General Subpart D—Responsibilities of Federal (a) Gives regulatory effect to the OMB
Agency Officials Regarding regulation (subparts A through F of 2
§ 3369.137 Who in the NEH may grant an Transactions CFR part 182) for the NEH’s grants and
exception to let an excluded person cooperative agreements; and
participate in a covered transaction? § 3369.437 What method do I use to
communicate to a participant the (b) Establishes NEH policies and
The NEH Chairman has the authority requirements described in the OMB procedures for compliance with the Act
to grant an exception to let an excluded regulation at 2 CFR 180.435? that are the same as those of other
person participate in a covered To communicate to a participant the Federal agencies, in conformance with
transaction, as provided in the OMB requirements described in 2 CFR the requirement in 41 U.S.C. 705 for
regulation at 2 CFR 180.135. 180.435, you must include a term or Governmentwide implementing
condition in the transaction that regulations.
Subpart B—Covered Transactions requires the participant’s compliance § 3373.20 Does this part apply to me?
with subpart C of 2 CFR part 180, as
§ 3369.220 What contracts and This part and, through this part,
supplemented by subpart C of this part,
subcontracts, in addition to those listed in pertinent portions of the OMB
2 CFR 180.220, are covered transactions? and requires the participant to include
a similar term or condition in lower-tier regulation in subparts A through F of 2
Although the OMB regulation at 2 covered transactions. CFR part 182 (see 2 CFR 182.115(b))
CFR 180.220(c) allows a Federal agency apply to you if you are a—
to do so (also see optional lower tier Subparts E–I [Reserved] (a) Recipient of a NEH grant or
coverage in the figure in appendix A to cooperative agreement; or
PART 3373—REQUIREMENTS FOR
2 CFR part 180), NEH does not extend DRUG-FREE WORKPLACE (b) NEH awarding official.
coverage of nonprocurement suspension (FINANCIAL ASSISTANCE)
and debarment requirements beyond § 3373.30 What policies and procedures
■ 296. The authority citation for part
must I follow?
first-tier procurement contracts under a
covered nonprocurement transaction. 3373 continues to read as follows: (a) General. You must follow the
Authority: 41 U.S.C. 701–707. policies and procedures specified in
Subpart C—Responsibilities of applicable sections of the OMB
■ 297. Revise §§ 3373.10 through
Participants Regarding Transactions regulation in subparts A through F of 2
3373.30 to read as follows: CFR part 182, as implemented by this
§ 3369.332 What methods must I use to § 3373.10 What does this part do? part.
pass requirements down to participants at
This part requires that the award and (b) Specific sections of OMB
lower tiers with whom I intend to do
business? administration of National Endowment regulation that this part supplements. In
for the Humanities (NEH) grants and implementing the OMB regulation in 2
You as a participant must include a cooperative agreements comply with CFR part 182, this part supplements
term or condition in lower-tier Office of Management and Budget four sections of the OMB regulation, as
transactions requiring lower-tier (OMB) regulation implementing the shown in the following table. For each
participants to comply with subpart C of portion of the Drug-Free Workplace Act of those sections, you must follow the
2 CFR part 180, as supplemented by this of 1988 (41 U.S.C. 701–707, as policies and procedures in the OMB
subpart. amended, hereinafter referred to as ‘‘the regulation, as supplemented by this
Act’’) that applies to grants. This part— part.
Section in this
Section of OMB part where What the supplementation clarifies
regulation supplemented
(1) 2 CFR 182.225(a) ..... § 3373.225 ........ Whom in the NEH a recipient other than an individual must notify if an employee is convicted for
a violation of a criminal drug statute in the workplace.
(2) 2 CFR 182.300(b) ..... § 3373.300 ........ Whom in the NEH a recipient who is an individual must notify if he or she is convicted of a crimi-
nal drug offense resulting from a violation occurring during the conduct of any award activity.
(3) 2 CFR 182.500 ......... § 3373.500 ........ Who in the NEH is authorized to determine that a recipient other than an individual is in violation
of the requirements of 2 CFR part 182, as implemented by this part.
(4) 2 CFR 182.505 ......... § 3373.505 ........ Who in the NEH is authorized to determine that a recipient who is an individual is in violation of
the requirements of 2 CFR part 182, as implemented by this part.
(c) Sections of the OMB regulation § 3373.400 What method do I use as an adopts the Governmentwide
that this part does not supplement. For agency awarding official to obtain a implementation (2 CFR part 182) of sec.
any section of OMB regulation in recipient’s agreement to comply with the 5152–5158 of the Drug-Free Workplace
OMB regulation?
subparts A through F of 2 CFR part 182 Act of 1988 (Pub. L. 100–690, Title V,
that is not listed in paragraph (b) of this To obtain a recipient’s agreement to Subtitle D; 41 U.S.C. 701–707).
khammond on DSK9W7S144PROD with PROPOSALS2
section, NEH policies and procedures comply with applicable requirements in
the OMB regulation at 2 CFR part 182, ■ 299. Revise part 3374 to read as
are the same as those in the OMB follows:
you must include the following term or
regulation.
condition in the award:
■ 298. Revise § 3373.400 to read as Drug-free workplace. You as the
follows: recipient must comply with drug-free
workplace requirements in subpart B (or
subpart C, if the recipient is an
individual) of 2 CFR part 3373, which
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32300 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
PART 3374—UNIFORM Authority: E.O. 12549 (3 CFR 1986 Comp., (b) The authority for all the provisions
ADMINISTRATIVE REQUIREMENTS, p. 189); E.O. 12689 (3 CFR 1989 Comp., p. in part 180 of this title as adopted in this
COST PRINCIPLES, AND AUDIT 235); sec. 2455, Pub. L. 103–355, 108 Stat. part are listed in the authority for this
3327 (31 U.S.C. 6101 note); 20 U.S.C. 1082, part.
REQUIREMENTS FOR FEDERAL 1094, 1221e–3, and 3474, unless otherwise
AWARDS ■ 305. Revise subpart B to read as
noted.
follows:
Sec. ■ 304. Revise § 3485.12 to read as
3374.1 Adoption of 2 CFR part 200. follows: Subpart B—Covered Transactions
3374.2 [Reserved]
§ 3485.12 What does this part do? § 3485.220 Are any procurement contracts
Authority: 5 U.S.C. 301, 20 U.S.C. 956, 2
CFR part 200. (a)(1) The Department of Education included as covered transactions?
(the ‘‘Department’’ or ‘‘ED’’) adopts (a) Covered transactions under this
§ 3374.1 Adoption of 2 CFR part 200. subparts A through I of the Office of part—
The National Endowment for the Management and Budget (OMB) (1) Do not include any procurement
Humanities (NEH) adopts the Office of regulation in 2 CFR part 180. This part contracts awarded directly by a Federal
Management and Budget (OMB) gives regulatory effect to the OMB agency; but
regulation in 2 CFR part 200. This part regulation for Federal awards issued by (2) Do include some procurement
gives regulatory effect to the OMB the Department of Education and contracts awarded by non-Federal
regulation for Federal awards issued by supplements the regulation as needed participants in nonprocurement covered
NEH. See 2 CFR 200.110(a) regarding for the Department. This part satisfies transactions.
the process for amending 2 CFR part the requirements in section 3 of (b) Specifically, a contract for goods
200. Executive Order 12549, ‘‘Debarment and or services is a covered transaction if
Suspension’’ (3 CFR, part 1986 Comp., any of the following applies:
§ 3374.2 [Reserved]
p. 189), Executive Order 12689, (1) The contract is awarded by a
CHAPTER XXXIV—DEPARTMENT OF ‘‘Debarment and Suspension’’ (3 CFR, participant in a nonprocurement
EDUCATION part 1989 Comp., p. 235), and 31 U.S.C. transaction that is covered under
6101 note (section 2455, Pub. L. 103– § 180.210 of this title, and the amount
PART 3474—UNIFORM 355, 108 Stat. 3327). of the contract is expected to equal or
ADMINISTRATIVE REQUIREMENTS, (2) This part contains only those exceed $25,000.
COST PRINCIPLES, AND AUDIT sections that include supplements to the (2) The contract requires the consent
REQUIREMENTS FOR FEDERAL regulation in part 180 of this title and of an official of a Federal agency. In that
AWARDS new sections needed to implement the case, the contract, regardless of the
■ 300. The authority citation for part OMB regulation for the Department’s amount, always is a covered transaction,
3474 continues to read as follows: programs. In those sections of the OMB and it does not matter who awarded it.
regulation that are supplemented, the For example, it could be a subcontract
Authority: 20 U.S.C. 1221e–3, 3474; 42
section in this part includes both the awarded by a contractor at a tier below
U.S.C. 2000bb et seq.; E.O. 13279, 67 FR
77141, 3 CFR, 2002 Comp., p. 258; E.O. text of the OMB regulation that is not a nonprocurement transaction, as shown
13559, 75 FR 71319, 3 CFR, 2010 Comp., p. affected by the change and any in appendix A to this part.
273; E.O. 13831, 83 FR 20715, 3 CFR, 2018 additional paragraphs that need to be (3) The contract is for federally-
Comp., p. 806; and 2 CFR part 200, unless added to the OMB regulation. For required audit services.
otherwise noted. example, § 180.220 of this title contains (4) The contract is to perform services
only paragraphs (a) and (b). The text of as a third party servicer in connection
§ 3474.1 [Redesignated as § 3474.3]
§ 3485.220, which supplements with a title IV, HEA program.
■ 301. Redesignate § 3474.1 as § 3474.3. § 180.220, includes both the text of (c) In addition to the contracts
■ 302. Revise newly redesignated paragraph (a) and (b) of § 180.220 and covered under § 180.220(b) of this title,
§ 3474.3 to read as follows: the text of added paragraph (c). this part applies to any contract,
§ 3474.3 Adoption of 2 CFR part 200.
(3) In those sections in part 180 of this regardless of tier, that is awarded by a
title that do not have paragraph contractor, subcontractor, supplier,
The Department of Education adopts designations and that the Department consultant, or its agent or representative
the Office of Management and Budget supplements, the section in this part in any transaction, if the contract is to
(OMB) regulation in 2 CFR part 200, implementing the OMB regulation be funded or provided by ED under a
except for 2 CFR 200.102(a) and designates the undesignated paragraph covered nonprocurement transaction
200.208. This part gives regulatory effect from part 180 as paragraph (a) and the and the amount of the contract is
to the OMB regulation for Federal first supplemental paragraph as expected to equal or exceed $25,000.
awards issued by the Department of paragraph (b). For example, § 180.330 of This extends the coverage of the ED
Education. See 2 CFR 200.110(a) this title includes an undesignated lead nonprocurement suspension and
regarding the process for amending 2 in paragraph and paragraphs (a) and (b). debarment requirements to all lower
CFR part 200. In § 3485.330, the undesignated tiers of subcontracts under covered
PART 3485—NONPROCUREMENT paragraph in § 180.330 is designated nonprocurement transactions, as
paragraph (a) and paragraphs (a) and (b) permitted under the OMB regulation at
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DEBARMENT AND SUSPENSION
are designated paragraphs (1) and (2). § 180.220(c) of this title (see optional
■ 303. The authority citation for part The added paragraphs are designated lower tier coverage in the figure in
3485 continues to read as follows: paragraphs (b) and (c). appendix A to this part).
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Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules 32301
CHAPTER XXXV—EXPORT-IMPORT BANK For any section of OMB regulation in § 3603.11 [Reserved]
OF THE UNITED STATES subparts A through I of 2 CFR part 180 CHAPTER XXXVII—PEACE CORPS
that has no corresponding section in ■ 311. Revise part 3700 to read as
PART 3513—NONPROCUREMENT this part, Ex-Im Bank policies and
DEBARMENT AND SUSPENSION follows:
procedures are those in the OMB
■ 306. The authority citation for part regulation. PART 3700—NONPROCUREMENT
3513 continues to read as follows: ■ 308. Revise § 3513.220 to read as DEBARMENT AND SUSPENSION
Authority: Sec. 2455, Pub. L. 103–355, 108 follows:
Sec.
Stat. 3327; E.O. 12549, 3 CFR, 1986 Comp.,
§ 3513.220 What contracts and 3700.10 What does this part do?
p. 189; E.O. 12689, 3 CFR, 1989 Comp., p.
subcontracts, in addition to those listed in 3700.20 Does this part apply to me?
235.
2 CFR 180.220, are covered transactions? 3700.30 What policies and procedures must
■ 307. Revise §§ 3513.10 through I follow?
3513.30 to read as follows: Although the OMB regulation at 2 3700.137 Who in the Peace Corps may grant
CFR 180.220(c) allows a Federal agency an exception to let an excluded person
§ 3513.10 What does this part do? to do so (also see optional lower tier participate in a covered transaction?
This part adopts the Office of coverage in the figure in appendix A to 3700.220 What contracts and subcontracts,
Management and Budget (OMB) 2 CFR part 180), Ex-Im Bank does not in addition to those listed in 2 CFR
regulation in subparts A through I of 2 extend coverage of nonprocurement 180.220, are covered transactions?
suspension and debarment requirements 3700.332 What methods must I use to pass
CFR part 180, as supplemented by this
requirements down to participants at
part, as the Export Import Bank of the beyond first-tier procurement under a lower tiers with whom I intend to do
United States (Ex-Im Bank) policies and covered nonprocurement transaction. business?
procedures for nonprocurement ■ 309. Revise § 3513.437 to read as 3700.437 What method do I use to
debarment and suspension. This part follows: communicate to a participant the
gives regulatory effect to the OMB requirements described in the OMB
regulation as supplemented by this part. § 3513.437 What method do I use to regulation at 2 CFR 180.435?
This part satisfies the requirements in communicate to a participant the
Authority: 22 U.S.C. 2503(b); sec. 2455,
section 3 of Executive Order 12549, requirements described in the OMB
Pub. L. 103–355, 108 Stat. 3327 (31 U.S.C.
regulation at 2 CFR 180.435?
‘‘Debarment and Suspension’’ (3 CFR, 6101 note); E.O. 12549, 51 FR 6370, 3 CFR,
1986 Comp., p. 189), Executive Order To communicate to a participant the 1986 Comp., p. 189; E.O. 12689, 54 FR 34131,
12689, ‘‘Debarment and Suspension’’ (3 requirements described in 2 CFR 3 CFR, 1989 Comp., p. 235.
CFR, 1989 Comp., p. 235), and 31 U.S.C. 180.435, you must include a term or § 3700.10 What does this part do?
6101 note (section 2455, Pub. L. 103– condition in the transaction that
This part adopts the Office of
355, 108 Stat. 3327). requires the participant’s compliance
Management and Budget (OMB)
with subpart C of 2 CFR part 180, as
§ 3513.20 Does this part apply to me? regulation in subparts A through I of 2
supplemented by subpart C of this part,
This part and, through this part, CFR part 180, as supplemented by this
and requires the participant to include
pertinent portions of the OMB part, as the Peace Corps policies and
a similar term or condition in lower-tier
regulation in subparts A through I of 2 procedures for nonprocurement
covered transactions.
CFR part 180 (see table 2 to 2 CFR debarment and suspension. This part
180.100(b)) apply to you if you are a— CHAPTER XXXVI—OFFICE OF NATIONAL gives regulatory effect for the Peace
(a) Participant or principal in a DRUG CONTROL POLICY, EXECUTIVE Corps to the OMB regulation as
OFFICE OF THE PRESIDENT supplemented by this part. This part
‘‘covered transaction’’ (see subpart B of
2 CFR part 180 and the definition of ■ 310. Revise part 3603 to read as satisfies the requirements in section 3 of
‘‘nonprocurement transaction’’ at 2 CFR follows: Executive Order 12549, ‘‘Debarment and
180.970, as supplemented by subpart B Suspension’’ (3 CFR, 1986 Comp., p.
of this part). PART 3603—UNIFORM 189), Executive Order 12689,
(b) Respondent in an Ex-Im Bank ADMINISTRATIVE REQUIREMENTS, ‘‘Debarment and Suspension’’ (3 CFR,
suspension or debarment action. COST PRINCIPLES, AND AUDIT 1989 Comp., p. 235), and 31 U.S.C. 6101
(c) Ex-Im Bank debarment or REQUIREMENTS FOR FEDERAL note (section 2455, Pub. L. 103–355, 108
suspension official. AWARDS Stat. 3327).
(d) Ex-Im Bank grants officer,
agreements officer, or other official Sec. § 3700.20 Does this part apply to me?
3603.10 Adoption of 2 CFR part 200. This part and, through this part,
authorized to enter into any type of
3603.11 [Reserved] pertinent portions of the OMB
nonprocurement transaction that is a
covered transaction. Authority: 21 U.S.C. 1706; 21 U.S.C. 1521– regulation in subparts A through I of 2
1548, 1701, 1703(d), 1703(f), and 2001–2003; CFR part (see table 2 to 2 CFR
§ 3513.30 What policies and procedures 2 CFR part 200. 180.100(b)) apply to you if you are a—
must I follow? (a) Participant or principal in a
§ 3603.10 Adoption of 2 CFR part 200.
Ex-Im Bank policies and procedures ‘‘covered transaction’’ (see subpart B of
that you must follow are the policies The Executive Office of the President, 2 CFR part 180 and the definition of
khammond on DSK9W7S144PROD with PROPOSALS2
and procedures specified in each Office of National Drug Control Policy ‘‘nonprocurement transaction’’ at 2 CFR
applicable section of the OMB (ONDCP) adopts the Office of 180.970);
regulation in subparts A through I of 2 Management and Budget (OMB) (b) Respondent in a Peace Corps
CFR part 180, as that section is regulation in 2 CFR part 200. This part suspension or debarment action;
supplemented by the section in this part gives regulatory effect to the OMB (c) Peace Corps debarment or
with the same section number. The regulation for Federal awards issued by suspension official; or
contracts that are covered transactions, the ONDCP. See 2 CFR 200.110(a) (d) Peace Corps grants officer,
for example, are specified by 2 CFR regarding the process for amending 2 agreements officer, or other official
180.220 as supplemented by § 3513.220. CFR part 200. authorized to enter into any type of
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32302 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
nonprocurement transaction that is a ■ 312. Add part 3701 to read as follows: requirements described in the OMB
covered transaction. regulation at 2 CFR 180.435?
PART 3701—UNIFORM Subparts E–H [Reserved]
§ 3700.30 What policies and procedures ADMINISTRATIVE REQUIREMENTS,
must I follow? COST PRINCIPLES, AND AUDIT Subpart I—Definitions
The Peace Corps policies and REQUIREMENTS FOR FEDERAL 5800.930 Debarring official.
procedures that you must follow are the AWARDS 5800.970 Nonprocurement transaction.
policies and procedures specified in 5800.1010 Suspending official.
each applicable section of the OMB Sec.
3701.10 Adoption of 2 CFR part 200. Subpart J [Reserved]
regulation in subparts A through I of 2
CFR part 180, as that section is 3701.11 [Reserved]
Authority: Sec. 2455, Pub. L. 103–355, 108
supplemented by the section in this part Authority: 22 U.S.C. 2503(b); sec. 2455, Stat. 3327 (31 U.S.C. 6101 note); E.O. 12549,
with the same section number. The Pub. L. 103–355, 108 Stat. 3327 (31 U.S.C. 51 FR 6370, 3 CFR, 1986 Comp., p. 189; E.O.
contracts that are covered transactions, 6101 note); E.O. 12549, 51 FR 6370, 3 CFR, 12689, 54 FR 34131, 3 CFR, 1989 Comp., p.
for example, are specified by 2 CFR 1986 Comp., p. 189; E.O. 12689, 54 FR 34131, 235.
3 CFR, 1989 Comp., p. 235.
180.220 as supplemented by § 5800.10 What does this part do?
§ 3700.220). For any section of OMB § 3701.10 Adoption of 2 CFR part 200. This part adopts the Office of
regulation in subparts A through I of 2 The Peace Corps adopts the Office of Management and Budget (OMB)
CFR part 180 that has no corresponding Management and Budget’s (OMB) regulation in subparts A through I of 2
section in this part, Peace Corps policies regulation in 2 CFR part 200. This part CFR part 180, as supplemented by this
and procedures are those in the OMB gives regulatory effect to the OMB part, as the U.S. Election Assistance
regulation. regulation for Federal awards made by Commission (‘‘the Commission’’ or
§ 3700.137 Who in the Peace Corps may the Peace Corps. See 2 CFR 200.110(a) ‘‘EAC’’) policies and procedures for
grant an exception to let an excluded regarding the process for amending 2 nonprocurement debarment and
person participate in a covered CFR part 200. Peace Corps may amend suspension. This part gives regulatory
transaction? its adoption of 2 CFR part 200 if agency- effect for the Commission to the OMB
The Director of the Peace Corps has specific additions, clarifications, or regulation as supplemented by this part.
the authority to grant an exception to let exceptions to the Government-wide This part satisfies the requirements in
an excluded person participate in a policies and procedures are required by section 3 of Executive Order 12549,
covered transaction, as provided in the Federal statute or are approved by OMB. ‘‘Debarment and Suspension’’, and 31
OMB regulation at 2 CFR 180.135. See 2 CFR 200.106. Any supplements to U.S.C. 6101 note.
the OMB regulation as needed for the
§ 3700.220 What contracts and Peace Corps, including additions or § 5800.20 Does this part apply to me?
subcontracts, in addition to those listed in clarifications, are set forth in this This part and, through this part,
2 CFR 180.220, are covered transactions?
chapter. pertinent portions of the OMB
Although the OMB regulation at 2 regulation in subparts A through I of 2
CFR 180.220(c) allows a Federal agency § 3701.11 [Reserved] CFR part (see table 2 to 2 CFR
to do so (also see optional lower tier CHAPTER LVIII—ELECTION ASSISTANCE 180.100(b)) apply to you if you are a—
coverage in the figure in appendix A to COMMISSION (a) Participant or principal in a
2 CFR part 180), Peace Corps does not ■ 313. Revise part 5800 to read as ‘‘covered transaction’’ (see subpart B of
extend coverage of nonprocurement follows: 2 CFR part 180 and the definition of
suspension and debarment requirements ‘‘nonprocurement transaction’’ at 2 CFR
beyond first-tier procurement contracts PART 5800—NONPROCUREMENT 180.970);
under a covered nonprocurement DEBARMENT AND SUSPENSION (b) Respondent in a Commission
transaction. suspension or debarment action;
Sec. (c) Commission debarment or
§ 3700.332 What methods must I use to 5800.10 What does this part do?
pass requirements down to participants at 5800.20 Does this part apply to me?
suspension official; or
lower tiers with whom I intend to do 5800.30 What policies and procedures must (d) Commission grants officer,
business? I follow? agreements officer, or other official
You as a participant must include a authorized to enter into any type of
Subpart A—General nonprocurement transaction that is a
term or condition in lower-tier
transactions requiring lower-tier 5800.137 Who at the Commission may grant covered transaction.
an exception to let an excluded person
participants to comply with subpart C of participate in a covered transaction? § 5800.30 What policies and procedures
2 CFR part 180. must I follow?
Subpart B—Covered Transactions
§ 3700.437 What method do I use to The Commission policies and
5800.220 What contracts and subcontracts, procedures that you must follow are the
communicate to a participant the
in addition to those listed in 2 CFR
requirements described in the OMB
180.220, are covered transactions?
policies and procedures specified in
regulation at 2 CFR 180.435? each applicable section of the OMB
To communicate to a participant the Subpart C—Responsibilities of Participants regulation in subparts A through I of 2
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requirements described in 2 CFR Regarding Transactions CFR part 180, as that section is
180.435, you as an agency official must 5800.332 What methods must I use to pass supplemented by the section in this part
include a term or condition in the requirements down to participants at with the same section number. The
transaction that requires the lower tiers with whom I intend to do contracts that are covered transactions,
participant’s compliance with subpart C business? for example, are specified by 2 CFR
of 2 CFR part 180, and requires the Subpart D—Responsibilities of Federal 180.220 as supplemented by § 5800.220.
participant to include a similar term or Agency Officials Regarding Transactions For any section of OMB regulation in
condition in lower-tier covered 5800.437 What method do I use to subparts A through I of 2 CFR part 180
transactions. communicate to a participant the that has no corresponding section in
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Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules 32303
this part, Commission policies and Subparts E–H [Reserved] PART 5900—UNIFORM
procedures are those in the OMB ADMINISTRATIVE REQUIREMENTS,
regulation. Subpart I—Definitions COST PRINCIPLES, AND AUDIT
§ 5800.930 Debarring official.
REQUIREMENTS FOR FEDERAL
Subpart A—General
AWARDS
For the Commission, the debarring
§ 5800.137 Who at the Commission may official for all nonprocurement
grant an exception to let an excluded Sec.
person participate in a covered
transactions is the Commission’s 5900.10 Adoption of 2 CFR part 200.
transaction? Contracting Officer. In the case of a 5900.11 [Reserved]
vacancy in the position of the
The Commission’s Contracting Officer Authority: 5 U.S.C. 301; 33 U.S.C.
Contracting Officer, the alternate
has the authority to grant an exception 1321(t)(2); 2 CFR part 200.
debarring official is the Chief Financial
to let an excluded person participate in Officer. § 5900.10 Adoption of 2 CFR part 200.
a covered transaction, as provided in the
OMB regulation at 2 CFR 180.135. § 5800.970 Nonprocurement transaction. The Gulf Coast Ecosystem Restoration
While the Commission treats all Council adopts the Office of
Subpart B—Covered Transactions payments made to States under 42 Management and Budget (OMB)
U.S.C. 15301, 15302 and 15401 as regulation in 2 CFR part 200. This part
§ 5800.220 What contracts and
grants, this part does not apply to grants gives regulatory effect to the OMB
subcontracts, in addition to those listed in
2 CFR 180.220, are covered transactions? made to States and political regulation for Federal awards issued by
subdivisions therein. the Gulf Coast Ecosystem Restoration
Pursuant to 2 CFR 180.220(c), the
Commission extends coverage of § 5800.1010 Suspending official. Council. See 2 CFR 200.110(a) regarding
nonprocurement suspension and For the Commission, the debarring the process for amending 2 CFR part
debarment requirements beyond first- official for all nonprocurement 200.
tier procurement contracts to include transactions is the Commission’s
§ 5900.11 [Reserved]
any subcontract. Contracting Officer. In the case of a
vacancy in the position of the CHAPTER LX—FEDERAL
Subpart C—Responsibilities of Contracting Officer, the alternate COMMUNICATIONS COMMISSION
Participants Regarding Transactions debarring official is the Chief Financial ■ 317. Revise part 6000 to read as
Officer.
§ 5800.332 What methods must I use to follows
pass requirements down to participants at Subpart J [Reserved]
lower tiers with whom I intend to do PART 6000—UNIFORM
business? PART 5801—UNIFORM ADMINISTRATIVE REQUIREMENTS,
If a lower-tier transaction is covered ADMINISTRATIVE REQUIREMENTS, COST PRINCIPLES, AND AUDIT
pursuant to § 5800.220, you as a COST PRINCIPLES, AND AUDIT REQUIREMENTS FOR FEDERAL
participant must include a term or REQUIREMENTS FOR FEDERAL AWARDS
condition in lower-tier transactions AWARDS
Sec.
requiring lower-tier participants to ■ 314. The authority citation for part 6000.1 Adoption of 2 CFR part 200.
comply with subpart C of 2 CFR part 5801 continues to read as follows: 6000.2 [Reserved]
180.
Authority: 2 CFR part 200. Authority: 47 U.S.C. 154(i), 1752(b)(10)(C);
Subpart D—Responsibilities of Federal ■ 315. Revise § 5801.10 to read as 2 CFR part 200.
Agency Officials Regarding follows:
Transactions § 6000.1 Adoption of 2 CFR part 200.
§ 5801.10 Adoption of 2 CFR part 200.
§ 5800.437 What method do I use to The U.S. Election Assistance Except as otherwise may be provided
communicate to a participant the Commission adopts the Office of by this part, the Federal
requirements described in the OMB Management and Budget (OMB) Communications Commission adopts
regulation at 2 CFR 180.435? regulation in 2 CFR part 200. This part the Uniform Administrative
To communicate to a participant the gives regulatory effect to the OMB Requirements, Cost Principles, and
requirements described in 2 CFR regulation for Federal awards issued by Audit Requirements for Federal Awards
180.435, you as an agency official must the U.S. Election Assistance set forth at 2 CFR part 200. This part
include a term or condition in the Commission. See 2 CFR 200.110(a) gives regulatory effect to the OMB
transaction that requires the regarding the process for amending 2 regulation for Federal awards issued by
participant’s compliance with subpart C CFR part 200. the Federal Communications
of 2 CFR part 180, and requires the CHAPTER LIX—GULF COAST ECOSYSTEM Commission. See 2 CFR 200.110(a)
participant to include a similar term or RESTORATION COUNCIL regarding the process for amending 2
condition in lower-tier covered ■ 316. Revise part 5900 to read as CFR part 200.
transactions. follows
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32304 Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules
§ 6000.2 [Reserved] CHAPTER LXII—DELTA REGIONAL CHAPTER LXIII—APPRAISAL
AUTHORITY SUBCOMMITTEE OF THE FEDERAL
■ 318. Add chapter LXI (consisting of
FINANCIAL INSTITUTIONS EXAMINATION
parts 6100 through 6199) to subtitle B to PART 6200—UNIFORM COUNCIL
read as follows: ADMINISTRATIVE REQUIREMENTS,
CHAPTER LXI—CONSUMER PRODUCT COST PRINCIPLES, AND AUDIT PART 6300—THE UNIFORM
SAFETY COMMISSION REQUIREMENTS FOR FEDERAL ADMINISTRATIVE REQUIREMENTS,
AWARDS COST PRINCIPLES, AND AUDIT
PART 6100—THE UNIFORM REQUIREMENTS FOR FEDERAL
ADMINISTRATIVE REQUIREMENTS, PARTS 6201–6299 [RESERVED] AWARDS
COST PRINCIPLES, AND AUDIT
REQUIREMENTS FOR FEDERAL PART 6200—UNIFORM PARTS 6301–6399 [RESERVED]
AWARDS ADMINISTRATIVE REQUIREMENTS,
COST PRINCIPLES, AND AUDIT PART 6300—THE UNIFORM
PARTS 6101–6199 [RESERVED] REQUIREMENTS FOR FEDERAL ADMINISTRATIVE REQUIREMENTS,
AWARDS COST PRINCIPLES, AND AUDIT
PART 6100—THE UNIFORM REQUIREMENTS FOR FEDERAL
ADMINISTRATIVE REQUIREMENTS, Sec. AWARDS
COST PRINCIPLES, AND AUDIT 6200.10 Adoption of 2 CFR part 200.
6200.11 [Reserved] Sec.
REQUIREMENTS FOR FEDERAL
6300.10 Adoption of 2 CFR part 200.
AWARDS Authority: 7 U.S.C. 2009aa–1 et seq.; Pub.
6300.11 [Reserved]
L. 106–554, 114 Stat. 2763.
Sec. Authority: 12 U.S.C. 3335, 12 U.S.C.
6100.10 Adoption of 2 CFR part 200. § 6200.10 Adoption of 2 CFR part 200. 3338(b)(4) and (5), 2 CFR part 200.
6100.11 [Reserved]
(a) The Delta Regional Authority § 6300.10 Adoption of 2 CFR part 200.
Authority: 15 U.S.C. 2054(c), 2090(a), and adopts the Office of Management and
8004(b)(2). Budget’s (OMB) regulation in 2 CFR part The Appraisal Subcommittee of the
200. This part gives regulatory effect to Federal Financial Institutions
§ 6100.10 Adoption of 2 CFR part 200.
the OMB regulation for Federal awards Examination Council (the Appraisal
The Consumer Product Safety made by the Delta Regional Authority. Subcommittee) adopts the Office of
Commission adopts the Office of Management and Budget’s (OMB)
(b) See 2 CFR 200.110(a) regarding the
Management and Budget’s (OMB) regulation in 2 CFR part 200. This part
process for amending 2 CFR part 200.
regulation in 2 CFR part 200. This part gives regulatory effect to the OMB
The Delta Regional Authority may
gives regulatory effect to the OMB regulation for Federal awards made by
amend its adoption of 2 CFR part 200
regulation for Federal awards made by the Appraisal Subcommittee. See 2 CFR
if agency-specific additions,
the Consumer Product Safety 200.110(a) regarding the process for
clarifications, or exceptions to the
Commission. See 2 CFR 200.110(a) amending 2 CFR part 200. The
Government-wide policies and
regarding the process for amending 2 Appraisal Subcommittee may amend its
procedures are required by Federal
CFR part 200. The Consumer Product adoption of 2 CFR part 200 if agency-
statute or are approved by OMB. See 2
Safety Commission may amend its specific additions, clarifications, or
CFR 200.106. Any supplements to the
adoption of 2 CFR part 200 if agency- exceptions to the Government-wide
OMB regulation as needed for the Delta
specific additions, clarifications, or policies and procedures are required by
Regional Authority, including additions
exceptions to the Government-wide Federal statute or are approved by OMB.
or clarifications, are set forth in this
policies and procedures are required by See 2 CFR 200.106. Any supplements to
chapter.
Federal statute or are approved by OMB. the OMB regulation as needed for the
See 2 CFR 200.106. Any supplements to § 6200.11 [Reserved] Appraisal Subcommittee, including
the OMB regulation as needed for the additions or clarifications, are set forth
Consumer Product Safety Commission, PARTS 6201–6299 [RESERVED] in this chapter.
including additions or clarifications, are
■ 320. Add chapter LXIII (consisting of § 6300.11 [Reserved]
set forth in this chapter.
parts 6300 through 6399) to subtitle B to
§ 6100.11 [Reserved] read as follows: PARTS 6301–6399 [RESERVED]
PARTS 6101–6199 [RESERVED] ■ 321. Add chapter LXIV (consisting of
parts 6400 through 6499) to subtitle B to
■ 319. Add chapter LXII (consisting of read as follows:
parts 6200 through 6299) to subtitle B to CHAPTER LXIV—MARINE MAMMAL
read as follows: COMMISSION
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PART 6400—UNIFORM
ADMINISTRATIVE REQUIREMENTS,
COST PRINCIPLES, AND AUDIT
REQUIREMENTS FOR FEDERAL
AWARDS
PARTS 6401–6499 [RESERVED]
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Federal Register / Vol. 91, No. 103 / Friday, May 29, 2026 / Proposed Rules 32305
PART 6400—UNIFORM of its authorizing statute, as amended. set forth at 2 CFR part 200. This part
ADMINISTRATIVE REQUIREMENTS, This part gives regulatory effect to the gives regulatory effect to the OMB
COST PRINCIPLES, AND AUDIT OMB regulation for Federal awards regulation for Federal awards
REQUIREMENTS FOR FEDERAL made by the Millennium Challenge administered by the NCUA. See 2 CFR
AWARDS Corporation, excepting those awards to 200.110(a) regarding the process for
or in support of candidate and eligible amending 2 CFR part 200. The NCUA
Sec. countries as determined by MCC under may amend its adoption of 2 CFR part
6400.10 Adoption of 2 CFR part 200.
the authority of its authorizing statute, 200 if agency-specific additions,
6400.11 [Reserved]
as amended. See 2 CFR 200.110(a) clarifications, or exceptions to the
Authority: 16 U.S.C. 1401 et seq.; 2 CFR regarding the process for amending 2 Government-wide policies and
part 200. procedures are required by Federal
CFR part 200. The Millennium
§ 6400.10 Adoption of 2 CFR part 200. Challenge Corporation may amend its statute or are approved by OMB. See 2
The Marine Mammal Commission adoption of 2 CFR part 200 if agency- CFR 200.106. Any supplements to the
adopts the Office of Management and specific additions, clarifications, OMB regulation as needed for the
Budget’s (OMB) regulation in 2 CFR part exceptions to the Government-wide NCUA, including additions or
200. This part gives regulatory effect to policies and procedures are required by clarifications, are set forth in this
the OMB regulation for Federal awards Federal statute or are approved by OMB. chapter.
made by the Marine Mammal See 2 CFR 200.106. Any supplements to § 6600.15 Other statutory and regulatory
Commission. See 2 CFR 200.110(a) the OMB regulation as needed for the requirements.
regarding the process for amending 2 Millennium Challenge Corporation, Pursuant to 12 U.S.C. 1772c–1,
CFR part 200. The Marine Mammal including additions or clarifications, are program-specific regulations governing
Commission may amend its adoption of set forth in this chapter. Publicly the Community Development Revolving
2 CFR part 200 if agency-specific available policies, processes, and rule Loan Fund for Credit Unions (CDRLF)
additions, clarifications, or exceptions for administrative requirements, cost may be found in 12 CFR part 705. These
to the Government-wide policies and principles, and audit requirements for program-specific regulations
procedures are required by Federal awards to or in support of candidate and supplement 2 CFR part 200. NCUA
statute or are approved by OMB. See 2 eligible countries can be found at policies concerning CDRLF awards,
CFR 200.106. Any supplements to the https://www.mcc.gov/resources. including notices, award terms and
OMB regulation as needed for the conditions, and regulations, are
§ 6500.11 [Reserved]
Marine Mammal Commission, including available on-line at www.ncua.gov. See
additions or clarifications, will be set PARTS 6501–6599 [Reserved] 2 CFR 200.101(d).
forth in this chapter.
■ 323. Add chapter LXVI (consisting of § 6600.102 Exceptions.
§ 6400.11 [Reserved] parts 6600 through 6699) to subtitle B to (a) Statutory or regulatory exceptions.
PARTS 6401–6499 [Reserved] read as follows: The NCUA may adjust requirements to
CHAPTER LXVI—NATIONAL CREDIT UNION a class of Federal awards if that
■ 322. Add chapter LXV (consisting of ADMINISTRATION requirement is specifically authorized or
parts 6500 through 6599) to subtitle B to required by a Federal statute or
read as follows: PART 6600—UNIFORM regulation adopted in the Code of
CHAPTER LXV—MILLENNIUM CHALLENGE ADMINISTRATIVE REQUIREMENTS, Federal Regulations after opportunity
CORPORATION COST PRINCIPLES, AND AUDIT for public comment, except for the
REQUIREMENTS FOR FEDERAL requirements in 2 CFR part 200, subpart
PART 6500—UNIFORM AWARDS F. Consistent with 2 CFR 200.101(d) and
ADMINISTRATIVE REQUIREMENTS, 200.102, such adjustments may be set
COST PRINCIPLES, AND AUDIT PARTS 6601–6699 [Reserved] forth in funding opportunities and
REQUIREMENTS FOR FEDERAL NCUA award documents.
AWARDS PART 6600—UNIFORM (b) Urgent awards. Except for those
ADMINISTRATIVE REQUIREMENTS, requirements imposed by statute or 2
PARTS 6501–6599 [Reserved] COST PRINCIPLES, AND AUDIT CFR part 200, subpart F, the NCUA may
REQUIREMENTS FOR FEDERAL adjust requirements when making
PART 6500—UNIFORM AWARDS Federal awards on an urgent or
ADMINISTRATIVE REQUIREMENTS, emergency basis under 12 CFR 705.8.
COST PRINCIPLES, AND AUDIT Sec. (c) Federal payment. Notwithstanding
REQUIREMENTS FOR FEDERAL 6600.10 Adoption of 2 CFR part 200. 2 CFR 200.305(d), the Federal Credit
AWARDS 6600.15 Other statutory and regulatory Union Act and the NCUA regulations at
requirements.
12 CFR 705.7(g) govern the
Sec. 6600.102 Exceptions.
disbursement and deposit of CDRLF
6500.10 Adoption of 2 CFR part 200. Authority: 12 U.S.C. 1756, 1757, 1766,
6500.11 [Reserved]
awards.
1772c–1, 1782, 1784, 1785, 1786, 2 CFR part (d) Appeals. Notwithstanding 2 CFR
Authority: 22 U.S.C. 84. 200. 200.342, the Federal Credit Union Act
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§ 6500.10 Adoption of 2 CFR part 200. § 6600.10 Adoption of 2 CFR part 200. and the NCUA regulations at 12 CFR
705.10 govern appeals for non-
The Millennium Challenge Except as otherwise may be provided
qualification and appeals of technical
Corporation (MCC) adopts the Office of by this chapter, the National Credit
assistance grant reimbursement denials.
Management and Budget’s (OMB) Union Administration (NCUA) adopts
regulation in 2 CFR part 200, except for the Office of Management and Budget’s PARTS 6601–6699 [Reserved]
issuance of funding to or in support of (OMB) Uniform Administrative
candidate and eligible countries as Requirements, Cost Principles, and [FR Doc. 2026–10817 Filed 5–28–26; 12:00 pm]
determined by MCC under the authority Audit Requirements for Federal Awards BILLING CODE 3110–01–P
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