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Federal Funding: A Period of Uncertainty and Preparation

Federal grant funding remains available across many agencies and programs, including the National Institutes of Health (NIH), FEMA, the Department of Energy, the Department of Labor, USDA, and the Small Business Administration. However, 2026 has brought a less predictable funding environment for applicants and current recipients.

Organizations can still expect opportunities in health and biomedical research, public safety, workforce development, infrastructure, technology, energy, rural development, and community resilience. At the same time, grant rules, review processes, funding priorities, and administrative requirements are changing.

One important development is the proposed Office of Management and Budget (OMB) update to the government-wide rules for federal financial assistance, often called the Uniform Guidance. These rules affect many federal grant recipients, including nonprofits, colleges and universities, local governments, research institutions, and sub-recipients.

If finalized, the proposed changes could give federal agencies more flexibility in making discretionary awards and in managing awards after they are made. Applicants may see stronger emphasis on whether a project aligns with the agency’s current priorities, statutory purpose, and desired outcomes. Recipients may also face increased attention to documentation, allowable costs, performance measures, procurement, and sub-recipient oversight.

For NIH applicants and recipients, scientific merit will remain essential. However, institutions should also be prepared for changes in funding priorities, application requirements, award terms, reporting expectations, and compliance expectations. The same is true for organizations seeking funding from other federal agencies.

What Grant Recipients Should Do Now

  • Monitor NIH, Grants.gov, and agency funding announcements regularly.
  • Avoid relying on old proposal language, budgets, or compliance procedures without reviewing current requirements.
  • Connect project goals, activities, and outcomes directly to the funding opportunity and the agency’s stated priorities.
  • Strengthen internal systems for budget oversight, documentation, procurement, performance reporting, and sub-recipient monitoring.
  • Prepare for possible delays, revised terms and conditions, or changes in reporting requirements.
  • Track proposed federal policy changes, but do not treat them as final until formally issued.

The challenge is no longer only writing a strong application. It is showing that your organization can deliver clear results, manage federal funds responsibly, and adapt quickly as the funding environment changes.

Mathilda Harris

Over the past 18 years, she has written grants, conducted capital campaigns, developed strategic plans for grant procurement, and assisted individuals and institutions to write winning proposals for various donors.

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