Senate Approves Short-Term Funding Bill with Grant Rule Delay

By Mitch Coppes, Federal Government Affairs Manager, Goodwill Industries International

With a government shutdown and mid-term elections in mind,  the Senate recently approved a continuing resolution (CR) that would keep the federal government funded through December 11, giving Congress additional time to complete work on fiscal year 2027 appropriations. The measure passed by a 90-6 vote before senators departed for the August recess.

Of particular importance to Goodwill and other federal grant recipients, the Senate-passed CR includes a temporary pause on implementation of the Office of Management and Budget’s proposed overhaul of the Uniform Guidance. The Uniform Guidance sets the rules for how federal grants are awarded, administered, monitored, reported, and, in some cases, terminated. Because these requirements shape nearly every aspect of federal grantmaking, the proposed changes have raised significant concerns among nonprofit organizations and government stakeholders warning that the changes could politicize grant decisions and create uncertainty for recipients.

Senator Susan Collins (R-ME), chair of the Appropriations Committee, pointed to the strong concerns raised during the public comment period on the proposed rule. “I am also pleased that this bipartisan agreement prevents the Office of Management and Budget (OMB)’s proposed rule regarding federal financial assistance from taking effect,” Collins said. “I advocated for significant changes to the proposed rule in a July 6 letter to the agency, citing its potential to politicize grants and harm small, rural communities, families, and biomedical research.” The Senate provision does not repeal the proposed rule, but it does delay implementation through early December.

The next step is in the House of Representatives when it returns from its August break. The House previously passed its own CR funding the government through December 4. However, the bill did not include the OMB rule delay or several other provisions added by the Senate. If the House changes the Senate-passed bill, the measure would need to return to the Senate when it reconvenes in mid-September.