Navigating federal grants amid uncertainty

Grant-funded organizations face an increasingly complex landscape influenced by federal funding changes and legal challenges. Given the vast scope of federal funding — over 2,200 federal assistance programs, including grants, loans, and other forms of financial and non-financial support, according to SAM.gov­ — these changes impact a wide range of organizations.

It's crucial for every organization whose funding may be affected to understand the implications of these changes and how to navigate these challenges.

Policy shifts

While this is not an exhaustive list and new developments may arise, here are some key policy changes that may affect grant-funded organizations:

• A requirement that educational institutions eliminate racial preferences in various areas or face the risk of losing federal funding. This requirement also affects private companies that serve as federal contractors or subcontractors, including higher education institutions, research organizations, and not-for-profit service providers.
• Freezes on federal grants and loans that affect Tribal communities’ abilities to provide essential services, raising concerns about the 638 contracts held with the federal government.
• Proposed Medicaid cuts over the next decade could severely impact individuals and families reliant on these services, as well as health care providers.
• The introduction of a 15% standard indirect cost rate for educational and medical institutions may hinder advancements in critical research by limiting operational funding. It could negatively affect the quality and sustainability of research programs vital for innovation and public health.
• Funding disbursements under the Inflation Reduction Act and the Infrastructure Investment and Jobs Act are currently on hold, affecting organizations in the clean energy sector. While some tax credits remain available, the pause on many programs creates uncertainty for future investments.