Revised OMB guidance reduces burdens on grant recipients and increases transparency with respect to more than $1.2 trillion in annual Federal financial assistance.

Today, the Biden-Harris Administration is announcing substantial updates to the Office of Management and Budget’s Guidance for Federal Financial Assistance, which sets the foundational requirements for agencies in making grants and providing other forms of Federal financial assistance, such as cooperative agreements and loans.

Each year, the Federal government provides more than $1.2 trillion in funding for thousands of programs through grants and other forms of financial assistance. From life-saving health care and after-school programs that keep our children safe, to improved critical infrastructure and research and development that helps our industries remain world leaders in health, science, and technology, the Federal government’s investments directly improve the daily lives of every American.

These updates to what is known as the Uniform Grants Guidance will streamline and clarify requirements for Federal funding. This will mean that recipients can invest in mission outcomes rather than in administrative overhead, while ensuring Federal agencies can effectively safeguard taxpayer resources. These changes will allow agencies and recipients of Federal funds to focus more time and money on delivering meaningful results for the American people.

The updated Uniform Grants Guidance also instructs agencies to make grant announcements as clear and concise as possible. This will make it easier for eligible recipients, including in underserved communities, to access critical funding. In addition, the updated Guidance gives recipients confidence that they can use Federal funds to invest in the continuous improvement of their programs by making clear that funding be used to support quality evaluation, data gathering and analysis, and community engagement. It also instructs agencies to engage affected communities – including nonprofit organizations, labor unions, and Tribal governments –as well as requiring recipients to use responsible contractors. Finally, the guidance materially reduces burden on recipients, as outlined in more detail below.

This is the most substantial revision to the Uniform Grants Guidance since it went into effect ten years ago and reflects significant input from over 50 Federal agencies as well as states, local governments, Tribal organizations, nonprofits, colleges and universities, and companies. In addition, the revision process included the review of more than 3,200 public comments in order to understand pain points and pinpoint inconsistencies in different agencies’ implementation of the previous version of the Guidance.

To accompany the finalized revisions to the Uniform Grants Guidance, OMB is also publishing an implementation memorandum that will direct agencies to put the revisions into effect by October 1, 2024, and provide additional tools to strengthen and streamline the administration of Federal financial assistance.

The finalized Uniform Grants Guidance will:

  • Reduce unnecessary compliance costs. The Guidance will modify numerous requirements to simplify compliance. For example, the updates reduce the number of additional “prior approvals” that recipients must receive from Federal agencies for spending money on specific activities. The Guidance also clarifies ambiguous terms so that recipients can comply with the same requirement in the same way, regardless of funding source. It also increases focus on the importance of data and evaluation in program development and implementation.
  • Remove barriers to entry. High administrative costs mean that some worthy projects never seek or obtain funding to begin with and never get off the ground. Among many changes to help remedy this, the guidance will result in revised Notices of Funding Opportunities (NOFOs) to make it easier for non-experts and smaller organizations to apply for Federal funding. The Guidance includes a complete revision of the NOFO requirements for Federal agencies, and underscores the importance of clearly communicating in plain language (including with a new Executive Summary section) only the essential information that is needed for applicants to understand program objectives and application requirements. Further, these revisions ensure that grant announcements are accessible to a wide group of eligible applicants, including in underserved communities, and offer pre-award technical assistance. 
  • Ensure assistance serves intended communities. Communities most in need of assistance are often least able to navigate the complex processes of applying for grant opportunities. Eliminating the requirement to use English language in notices, applications, and reporting will make grants more accessible to everyone. This is just one example of how the updated guidance will allow for more equitable access across communities.

In addition to setting an implementation deadline of October 1, 2024 for the Uniform Grants Guidance, OMB’s implementation memorandum provides agencies direction on how to strengthen the whole lifecycle of Federal financial assistance. These measures include:

  • Instructing agencies to further simplify their NOFOs. Agencies should increase NOFOs’ accessibility, readability, and clarity of NOFOs while also using the grantmaking process as a tool to identify and address supply chain gaps.
  • Strengthening the Federal Program Inventory (FPI). The FPI is a new comprehensive, searchable tool with critical information about all Federal programs that provide grants, loans, or direct payments to individuals, governments, firms or other organizations. Agencies will be required to improve the official descriptions of their programs, or Assistance Listings, which feed the inventory.
  • Supporting programs for Tribal nations. Consistent with Executive Order 14112, the memorandum relays ways for a agencies to design, revise, and provide waivers to increase the accessibility, equity, flexibility, and utility of Federal funding and support programs for Tribal Nations and Indians.

Americans invest more than a trillion dollars each year in grants and other Federal financial assistance. By revising the Uniform Grants Guidance and issuing the implementation memorandum, the Biden-Harris Administration is empowering Americans to find Federal programs that can help them in a time of need. This will make it easier to apply for Federal funds and track how money is spent. Together, this new Guidance will deliver a stronger and more transparent Federal government.

Please see here to review the revised Uniform Grants Guidance and addendum highlighting certain revisions.

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